Outside morning sunlight runs its fingers through a city. From the bedroom window of your apartment, you can hear cars chatter on the streets below past people carrying briefcases into the arms of giant steel and glass buildings. Some have cups of coffee rested in their hands after waiting in line at the corner Starbucks, the sound of machines rattling and hissing as people flash the screens of smartphones to pay.
As is becoming of capitalism everything moves quick and rather efficiently, but between the cracks wonder seeps in making room for new ideas and fresh creation.
Although some do not associate capitalism with the efficient societal movements of a neighborhood, town or city, but instead view it as represented by hushed back room conversations between business elites and public officials, corporate greed and wall street corruption.
All scenes that surely exist for we do not live in a utopia. Yet, it should be contrasted that self-interest doesn’t have to be whispered or dirty. Capitalism, a system of cooperative production and free exchange with minimal government interference, is at its heart human self-interest being recognized and channeled into compassion and concern for the other.
The pivotal Scottish philosopher and economist Adam Smith referred to this phenomenon as the “invisible hand,” that guides the private efforts of individuals to serving overall public interest.
Every businessperson has an appetite, a hunger for something of material or abstract value, and when that appetite is coupled with a good ethical foundation and moral code everyone stands to be served.
As Smith puts it, “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.”
This is a setup that allows for material wealth such as i-phones, automobiles and novelties like coffee to proliferate in the hands of people at all levels of income, thus benefitting society as a whole and not just the rich or on some small scale.
Healthy competition in a free market drives the prices of products down as entrepreneurs, who due to the nature of their objective must respond to the desires and needs of costumers, adjust their prices to reflect external reactions.
An example of this would be a comparison to 1984 when people lined up to buy the first cellphone dubbed “the brick.” At what would now be considered overpriced for an inefficient product weighing two pounds and offering a mere half-hour of call time for every recharge, this item sold for a whopping $3,995 thousand!
Now customers can go into an Apple store and buy the latest i-phone 6 for between five and seven hundred dollars. Older models are bought and sold at even cheaper prices.
With every upgrade the worth of previous innovations are lowered. In other words the new is always replacing the old and in a fast developing society, this economic process coined as “creative destruction” by 20th-century economist Joseph Schumpeter happens constantly.
No business would be able to get away with selling a flip phone at as high of a price as the latest smartphone.
Inadvertently when entrepreneurs look out for themselves by satisfying public interests with their products, they are participating in a form of altruism.
On the flip side, a business that deceives and takes advantage of customers is greedy and will likely lose profit or go out of business.
The genius of capitalism is that it establishes benevolence and altruism as chosen values. An individual in a capitalist society can be hospitable, self-sacrificing and generous, or they can be self-interested and out for their own profit. Either way, the system of capitalism and society as a whole can benefit from their labors because both individuals have to please the consumer who in turn votes with their wallet.
