Farmers Market

Einblick

Farfalline

Bilmek

Lewis & Quark


     What is your favorite thing you ever bought? Toys? Clothes? Books? How did you get the money to pay for it? This last question falls so naturally in with the rest, but upon examination, it doesn't quite fit. Why do we need money to get what we want? Why is it so important?
     Bu more importantly, what is economics? Definitions of terms are the most significant things in any study. Economics is simply, the fair exchange of money, worth something for goods or services, for the mutual benefit of both parties involved. The buyer, or employer, depending on whether goods or services are being bought, offers the seller or employee something that the seller or employee desires for his ends. Typically, this takes the form of money.
     Your mind flashes to green bills and silver coins, but this wasn't and isn't always the case. The obvious question: money is printed paper and bits of metal, but it can't do anything for you in a lot of senses. Inedible. Small. Money is only as valuable as society says it is. Any money can only buy me material goods because the collective has willed it.
     But as a study, economics is observations about the impact incentives and resources will have on human behavior and allocation of scarce resources. Economics exists because of a basic human component: desire.
Economics exists because of a basic human component: desire. 
     You all want something. Generally, peace, life, and specifically things that appeal to you personally. Your parents were the same. And so were their parents. Therefore, we should expect to see a history of economics. And we do. People have been buying and trading forever. But Scottish philosopher Adam Smith is typically considered the father of modern economics. From his theory of "the invisible hand" and the free market concept came capitalism.
     For Smith, as consumers pay money to companies for their needs, those companies use that money to assist others by continuing to offer their services by your contributed money, and paying it to their employees who use that money to help themselves and their families and other economic institutions, etc. A culture of competition is created when a marketplace of producers and consumers sets out to better each individual's own situation. And this competition creates lower prices and a variety of goods and services. That's the "invisible hand." And capitalism. Smith's magnum opus, The Wealth of Nations, is one of the first works to advocate for free-market capitalism, the idea that opts for privately owned businesses and where profit is the explicit incentive.
     Besides this, capitalism is the most effective and moral economics system, evidenced by the thriving middle classes of economies like Canada, Hong Kong, and Australia. Following Smith's ideals, other notable economists include David Ricardio, who demonstrated free trade's mutual competitive advantages. Thomas Malthus did yeoman's (pronounced yoh-man's) work on population's impact on economics, but also connected economic realities to their inducement to moral and industrious behavior. John Stuart Mill aligned with Smith on free markets properly allotting resources, but contested the idea that market could properly distribute income and profits. These economists all fell under the orthodox "classical" school of economists, denoting traditional practices and a particular point of view.
      Descending from them, the most notorious economist of them all was Karl Marx. Marx saw the failures of Smith's "invisible hand" and decided that the only way to fix them was to place the means of society into collective ownership. Communism, Marx's intellectual child, just as much political philosophy as economic system, brought forth tyranny, murder, and widespread failure to all who attempted it. It would be a gross oversimplification to say that the ultimate division in economic theory and practice lies in the antagonism between the followers of Smith--the capitalists--and the followers of Marx, the communists. For all the complexities of modern economic schools of thought, and the key thinkers, the essential disagreement lies in the moral and practical consequences of private property and profit motive. Money is viewed in two ways--what it can get, private property, and getting it, profit motive.
     Private property is acceptable based on the simple proposition, "Thou shalt not steal." The prohibition of theft presupposes the institution of private property. And as John Locke, and later Murray Rothbard, argued, to have private property is to be awarded the fruit of one's own labors. Common ownership of resources does not produce any incentive to work. The pilgrims of Plymouth attempted communism, and reverted to a capitalist system because they observed this principle in action--and how it failed.
     Practically, capitalism is a fine thing, and morally, as the incentive causes the benefit of the whole. But we should not be lulled into thinking that the poor will be cared for by the "invisible hand," nor does capitalism stop corruption from spreading.
"For the poor you have with you always, but Me you do not have always.” (John 12:8)
     Marx saw this, and created a solution that became a problem--witness communism. Power reveals, and absolute power reveals absolutely. Money is the closest one can get to a physical manifestation of power. Whole countries are destroyed for trade routes, productive land or oil rich territory. Politicians abandon justice and honesty for it. And this can all be found in capitalist America, haven of freedom and uprightness.
     Power is not bad, just to be used responsibly. And the more power, the more dangerous. And the more dangerous, the more tempting to ill-use. Money is a physical thing as well. Easily measured. More money, more power, more temptation, more ill-use. Aristotle says in his Politics that to be rich is harmful to society, instead opting for a one of the middle class--where freedom is preserved, money is not worshiped, and the people respect their rulers.
     That is more than likely your path. You've already spent money. You very soon will need to be involved in the making or distributing of goods and services. You might even have to provide for your own children. We rarely think of the sacrifices our parents make in our names. People rise on the economic ladder because of you. People with families and ensured commitments are given raises. Augustus Caesar, to encourage marriage, gave tax breaks to men with families.
     You're also expensive, not just tax relieving. The average family will spend $233,610 to raise a child.
The average family will spend $233,610 to raise a child. 
     It might be helpful to be rich while raising you, spending money on mortgages, food, cars, etc. That's simple. But listen to the characteristics of the rich, according to Aristotle.
"Insolent and arrogant...wealth affects their understanding...luxurious and ostentatious...vulgar.... In a word, the type of character produced by wealth is that of a prosperous fool."  (Rhetoric, Book II.16)
Wealth, excessive wealth, is inadvisable, even hurtful. So be happy with your money. Be generous. Be successful. But money will never satisfy you. Ecclesiastes 5:10 says
"He who loves silver will not be satisfied with silver; nor he who loves abundance, with increase. This also is vanity." 
Ultimately, it will pass away. And while we defend capitalism and our private property, we guard something greater, something that will never pass away--freedoms of humans made in the image of God.
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