Wealth Creation A Foundational Thing

Written By: Wendell Krossa

A Foundational Thing (or Its Not the Root of Evil)
A foundational impetus for human progress has been discovered from our experience over the past two centuries. This foundational factor in progress is wealth creation, and we now have overwhelming evidence of what it produces in human societies (wealth creation encompasses general economic development and growth with its central elements of industrialization and technological progress).

1.  One of the most important products of wealth creation or growing prosperity is the sharp decrease in conflict or warfare.  Stephen LeBlanc in ‘Constant Battles’ offers a broad overview of the dynamics operating here.

2.  Wealth creation also leads to improved environmental situations.  This is most notable in the developed world.  For extensive detail see Bjorn Lomberg’s ‘The Skeptical Environmentalist’. This result entirely nullifies the environmentalist claim that economic development is destroying the environment.

3. Wealth creation has produced democracy in general with its highly valued freedoms and rights. William Bernstein traces the history of this trend in his book The Birth Of Plenty.

4. Wealth creation has also produced the greatest accomplishment ever made by humanity- improved health and longer life spans. See again Lomberg’s ‘The Skeptical Environmentalist’ along with Julian Simon’s ‘The Ultimate Resource’.  There are other significant products of wealth creation.

In summary, wealth creation is foundational to all that we value most in life. It is foundational to the survival and progress of human civilization and yet it is under relentless attack from the environmentalist movement with its pessimistic views of limited resources and its obsession to prevent economic growth (for a crisp treatment of the Sustainable Development ideology see ‘A Poverty of Reason’ by Wilfred Beckerman).

Wealth creation has emerged as a significant and broadly experienced social force only in the last two centuries with the development of an economic system based on individual human freedom and initiative. This system tapped into the universal human desire for something better which is expressed in the drive to improve one’s personal situation. This drive had long been suppressed by power-holding elites who denied most citizens of states any opportunity to improve themselves or to retain the full results of their personal labor.

With the emergence of genuine service states in the early 1800s, people developed the social institutions necessary to protect and encourage the individual freedom to seek something better; private property rights, capital markets; scientific rationality and communication/transportation infrastructure. These service states also developed mechanisms that made them fully accountable to citizens as the true source of authority (government of, by and for the people). This was a tectonic shift from former state models where citizens were subservient to state elites. The Socialist models never understood the importance of individual freedom and have continued to advocate oppressive models oriented to ‘holism’ where citizens are subservient to the greater good of the state and its programs (hence the centralized control and domination of citizens in the socialist experiments).  Socialist systems with their orientation to excessive state control and regulation, along with their anti-private property and anti-free trade stances, sever the natural human impulse to improve life and to find reward in doing so.

With its orientation to human freedom, the free enterprise model has developed a healthy suspicion of ‘government’ and strives to maintain a minimal state that constantly guards against the tendency to intrude upon and control the lives of its citizens.  In this model the ideal is minimal regulation, preferably limited to standards, accountability, provision of fair opportunity for all, and protection of individual freedom.  Rejecting the tyranny of holism (living for some greater good- (see ‘In a Dark Wood’ by Alston Chase); the free enterprise system understands that encouraging every person to improve their own situation is the best way to lift entire societies. This approach has succeeded in advancing human societies beyond anyone’s wildest imagination.

The success of the free enterprise model lies in its ability to liberate the human spirit which naturally possesses the impulse to create, to solve problems, to invent, to innovate, to explore, and to improve life.  Individuals given the freedom to fully express themselves will find ways to improve life (new goods and services), and this benefits everyone in the end.