Bob George
Proud Member
This is your typical pencil. Seems like a very simplistic item. Yet there is no one single person in the world who can make this pencil. No one. Now, that may seem like a remarkable statement, but let's look into this for a moment.
The wood to make the pencil came from a tree which had to be cut down. To cut down the tree one needs a saw. To make the saw you need steel. To make the steel it took iron.
The black thing down the centre of the pencil, we call it lead but it's really made from compressed graphite. The graphite probably came from mines in South America or some such place.
The pink/red tip, the eraser, is made of rubber. I'm not sure if it's synthetic or natural rubber, or a combination of both. But the rubber probably came from Malaya, where the rubber tree isn't even native. The rubber tree is actually native to South America and was imported to Malaya by some businessmen trying to make some money with the help of the British government.
Then there's the brass piece around the top of the pencil and the bottom of the eraser, the yellow paint, the lettering. The materials to do this could have come from anywhere.
The point is, it took a lot of people to make this one pencil. From miners in South America, to factory workers, to the people who helped ship the materials from country to country. Potentially thousands of people cooperated together to make this pencil. People who don't speak the same language, who practice different religions, who are of different ethnicities. And why? Was it an order passed down from some sort of Authoritative body, enforced by some Commissar? No. It was the product of different individuals engaging in voluntary exchange to satisfy their self interest. Or as it is often called, the free market system.
When you go down to the store and purchase a pencil you aren't thinking about you are in effect helping thousands of workers to get paid for the labour and services. You are simply satisfying your self interest. You need or want a pencil, you pay a price that you agree upon (because all exchanges are voluntary in a free market system, no one forces you to pay a price you don't think is fair). Self-interest and greed is seen as a bad thing. And it can be. But in a free market, capitalist system, to satisfy your self-interest or greed, you need to help others.
Even the big fat cat in his multi-million dollar home wanting to satisfy his greed by adding another hundred thousand dollar car to his garage has to inadvertently help others to satisfy that greed. He has to buy that car from a car dealer. That car dealer has to hire a salesman to sell the car. They also have to buy the car from the manufacturer. The manufacturer has to make the car using materials imported from all over the world. Potentially thousands of workers are involved in manufacturing of the materials that make the car and the car itself. The car was probably advertised, so an advertising agency would have been hired. That ad then goes on TV and in print which helps pay for the wages of everyone employed at the television, newspaper and magazine companies. And I'm just getting started. The amount of people that one greedy transaction could have helped is incomprehensible.
Why am I telling you all this? There is a worrying lack of confidence and faith in the free market system at the moment. There is also a troubling move towards stifling this free market with heavy taxes and regulations all in the solving problems that could better be solved by the private sector anyway. Every dollar you forcefully take from the private sector (taxation) is a dollar the private sector can no longer spend. And as demonstrated with the pencil story, a dollar can go a very long way in helping a lot of people through a simple act of voluntary exchange between individuals serving their self interest.
What's all this taxation, regulation and government action trying to achieve anyway? Equality? Cooperation? Wealth redistribution? All these things are better solved by free individuals engages in voluntary exchanges with other individuals. All government action has even done to reduce inequality is make everybody equally poor and miserable. Historical record shows that the only time any society with high levels of poverty and huge inequality between the ruling class and the working class has been when these societies have adopted free-market principles, liberalisation. And as I've already demonstrated, the free market is the most successful tool for getting many, many people to cooperate together. People of different races, creeds, languages etc. As for wealth redistribution, I think I've already demonstrated how 20c spent on a pencil is rationed out by the invisible hand of the free market to everyone who participated in producing it and selling it. The free market just does it better. We as individuals do a better job trying to satisfy our self interest than we as a collective can do trying to satisfy what we think is in the common interest.
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