Hat tip to Cynthia Catsman
Many times, I’ll be surprised with the direction of discussion that will follow one of my blog posts. Often times, one of the more minor points will become the main topic of conversation, or a new point will develop entirely, one that I had not thought about. Hence today’s post, which is now a third generation of that sort of thing stemming from two posts ago. I’ll give you the history, and the chance to catch up if you are at all interested. First, I wrote this, about the Obama Boom. It contained a link to here, which dealt with the rampant inflation experienced in Zimbabwe and drew parallels to President Obama’s current rhetoric and policy initiatives. In response to that essay, someone made an observation about jobs and hiring that involved a clear denunciation of jobs offered by McDonald’s specifically, as not being worthy of any who wished to actually work rather than exist on the public dole. That concept angered me, as it has for many years, so I wrote this essay as a response.
One of the comments that came out during the subsequent discussion for that essay was the call for covering the flip side of the free market coin. Specifically, how should we go about the business of making the world more fair, especially in regards to companies, “downsizing,” long term employees or practicing the already illegal technique of saving money by firing older employees and replacing them with cheaper younger employees? So, here we are, with my response to a legitimate concern. I am almost positive that my answer to those concerns will not be well received by the person raising them, but then, them’s the breaks.
As a small child growing up in West Virginia, I would often implore my parents to allow allow me to violate one of the boundaries set by attentive parents upon their children through use of the phrase, “it’s not fair.” The response from my parents has turned out to be the single truest thing that anybody has ever said to me. The response was so true and insightful as a matter of fact, I believe it should be etched in the stone archway to every elementary, middle, and high school across the country. It should be engraved on every building in every college campus within these United States. It should be taught in every economics class right along with the law of supply and demand. Are you ready? Here it is:
Life is not fair.
As Americans, we have all grown up with a sense of fair play being ingrained in our psyches, as our laws and founding principles are designed to treat all people equally within the law, and to eliminate special treatment depending upon social strata within our society. That equality of opportunity is however vastly different than equality of guaranteed outcomes. Equal treatment under the law is vastly different than what the concept of fair has been interpreted to mean by many people. What’s even beyond that however is the fact that any time the government, or any government for that matter has gone about the business of attempting to mandate fairness through legislation, the result is invariably a situation that is considerably worse, and many times worse for group being, “protected.”
Is it fair that some employers might discriminate based on factors that might seem shallow to the rest of a society that feels itself more enlightened? Probably not, but let’s look at the real results of our attempts to deal with that perceived inequity. We’ll use as a reference, our old friend Dr. Milton Friedman.
That’s an important note to make, and the lesson can be applied across so many different variations of this practice of legislating fairness.
The ultimate accomplishment of these fairness laws is to reduce to zero the economic cost of capricious behavior.
If for example, an employer wishes to fire more experienced help in order to replace them with younger labor, he faces an economic penalty if the older more experienced workers find employment with his competition, open their own businesses engaged in the same activity, utilize their talents elsewhere to improve the products and services in a way that the less experienced help might not know how to do, or use their connections to flat out steal business away from the original employer. Legislating fairness will only have the effect of eliminating those costs.
Usually, although not with our most recent recession, which has lasted a full four years, entrepreneurial start ups experience their greatest activity when unemployment spikes. The reason for this is that many people who lose their jobs who are more advanced in years often find it difficult to reenter the workforce. Coincidentally, this is also the same group to have a little capital tucked away, and also has the greatest level of experience and know how. Unfortunately, during the age of Obama, the number of these start up businesses has fallen to an all time low. We can thank the over zealous culture of regulation for that, but this is another topic entirely. The point is, that while it may not be fair to see more experienced people lose their jobs due to short sighted and shallow reasons, the answers lie in creating an environment that gives them the greatest chances for future success, and not in trying to legislate fairness into the equation.
No economic system is perfect. Capitalism should not be measured against Utopia, but against the other economic systems that exist.
Inequities can be pointed out in any economic system. Nothing is perfect, and further, perfection is not meant for this world. The lens of history is crystal clear on this point. The lot of the ordinary person has never been as bright as it has been in those nations that have allowed the maximum amount of personal liberty and freedom, both economically and socially. The lot of the ordinary person has never been so bleak as it has been in those nations that have imposed the greatest amounts of centralized control both economically and socially. The defending cry of centralized planners is always that they are defending the weak and down trodden. Yet, throughout history, time and again, their planning invariably results in greater amounts of hardship for the very masses they claim to care so much about. Is it rotten when bad things happen to good people? Of course it is, but the answer is to allow people the opportunity to rise above those hardships and to advance themselves to their desired social strata.
Harlan Sanders was 65 years old when he founded Kentucky Fried Chicken. He started the business almost immediately after his fourth bankruptcy, which he suffered after his employer forced him to leave the company because he was too old. One of the first people he hired in his new company was a man named Dave Thomas, fresh off of being fired from his job at a J.C. Penney’s Department Store. He later went on to found a small hamburger chain called Wendy’s. I am not saying that it does not suck to be fired, just that here in America, this is one of the places and systems that gives one the best chance to regroup and flourish after such an event.