Hard to find a more thorough smackdown of Greed, and how it is responsible for all our current woes, than right here:
‘Greed is the Beginning of Everything’ from Der Spiegel.
Trouble is, it’s all wrong. The article is too long to quote in full, so Smiling Dave will just quote snippets and critique. To get the full relish and juice of my wonderful rebuttal, I humbly suggest you read the Spiegel article first, or maybe side by side.
[Originally, I wrote is as a reply to someone on redditt, so the style is that of addressing him, as opposed to you, dear reader. But I’m sure that will not be a problem.]
Without further ado, Smiling Dave’s comments on the article:
The beginning is just hot air and moralizing. The first half-way serious sentence is, “One can expand the supply of goods and the purchasing power needed to acquire them. That’s the hedonistic program, which we have chosen since the days of the Greeks and Romans, but which threatens to fall apart in the debt crisis. The monetization of our society has strengthened the illusion that all the things we desire are within our reach.”
He’s saying the debt crisis is making the ancient system of increasing the supply of goods and of purchasing power fall apart. Rubbish. The debt crisis is the direct result of NOT increasing the supply of goods. If the modern Greeks, for example, had produced more goods, they would not be in debt in the first place.
Not sure what he means by the monetization of our society. I doubt he means the ever increasing printing of digital money , but if he does mean that, he would be right. It does give some people illusory wealth.
Next he goes on to how wonderfully better off we all will be if only we had a lot less of everything. Not sure how he knows everyone feels the same way.
Then Speigel makes the ridiculous comment that, “SPIEGEL: The debts of Western countries haven’t grown in the last 30 or 40 years as a result of need, but of abundance.”
We had so much stuff we couldn’t afford to pay for it all, and had to go into debt to have it? This contradicts that portion of Say’s Law that all economists agree to.
“Man has a need for fairness and, therefore, for a fair distribution of wealth.”
Dangerous words. Luckily, he preceded this by saying that most people can be trusted give charity without coercion [though he did not relaize that is what he was saying] when he declared that, “Only a truly egomaniacal person can live happily in a society in which he is the only rich one.”
“He [=Adam Smith] clearly distanced himself from his contemporary Bernard Mandeville and his theory that private vices generate public advantages, and that the general welfare stems from the self-interest of the individual.” I call BS. Prove this absurd statement.
Then Spiegel has his only intellignet thought of the night, though he doesn’t realize it, when he says, “If the invisible hand of the market alone were capable of transforming self-interest into the common good, we wouldn’t need government regulation at all.” You got it. That’s so right. The premise is true, as is the conclusion.
“The interdependence between capital and the state became obvious during the crisis. The financial system would have collapsed without government help…” False. Some banks would have gone bankrupt, yes, as they deserved to and had to. They were kept alive at the expense of everyone else [=the taxpayer] impoverishing the country and keeping incompetents at the helm of our financial institutions.
This whole piece is just propaganda. The point is that we need the govt to save us from our greed, and that less of everything is good for your soul, so get ready for it.
“Regulation may be a loaded concept, so let’s talk about coordination instead. ” This is meant to be serious economics? Calling something by its real name is unpleasant, so let’s call it something else.
Suddenly, the article takes a decided turn for the better. I am stunned. Look at these sound Austrian statements:
“Instead of maximizing the gross domestic product, the goal should be to minimize debt.” YES!
“In a free-market democracy, politicians should be deprived of the right and the authority to incur debt, just as they have already lost the right to print money.” YES! [though of course, only a handful of politicians have lost the right to print money, with many retaining that “right”].
Then he goes on to some more nonsense, winding up with a few real idiocies:
“An economic policy that only pursues growth will always lead to debt.”
Actually, the economic policy that pursues growth is one of hands off and let the free market be free. It is false that it will always lead into debt. They are unrelated. Debt is when the govt or when individuals borrows money. What has this to do with economic growth?
Of course, profitable businesses also borrow money, but always with the assumption on their part and the banks’ part that the business will be able to repay the debt, since the money will be used to increase profits. But this is not a bad thing.
More moralizing to finish the article off.
Bottom line: He clearly has no understanding of basic economics.