Before I go too far the other way, let me start by saying that concepts such as property rights, mutual coincidence of wants, and free market trading have been extremely positive means of advancing humanity. Free markets and the profit motive have been responsible for raising countless people from poverty to affluence, and given rise to more technical advancement and increased living standards in the last 150 years than we have seen in the rest of history. With that glowing review in mind, let’s take a look at some consequences when the pendulum swings too far.
The free market has shown in practice to be, in my opinion, a superior model for an economy. But in the rush of the western world toward these ideals, the free market is also now a part of our culture and values. We see it in the actions of others, we excuse it in our own, but for those of us living steeped in western culture, it’s so ingrained that we don’t feel it. What happens when we use market forces, measured in dollars, as the primary factor (or in many cases the only factor) in making decisions? Are there really factors of greater value? Are we fated to make the best economic decision regardless of other considerations? Here are a few concrete ways to unpack this, and I’ll try to offend everyone equally:
- The corporation that outsources jobs abroad: What else could they do? It saved a lot of money and prevented a price increase that consumers would not tolerate. Foreign workers will accept lower wages and worse conditions for the same work.
- The employee that leaves for a better paying job, even though they like their current job: Sure, their quality of life may suffer through a longer commute, less time with their family, a more stringent management structure. But what could they do? It pays more. Nobody at the old company even questions the decision.
- The labor group that demands increasingly higher wages for the same work: It doesn’t matter that their work won’t create additional value for the company, their basic interest is to get the most from the employer possible. Why wouldn’t they?
- The consumer who complains about low wages, overseas manufacturing, and corporate greed, but still shops at the big box store to get a marginally lower price: Of course they do, because when it comes down to it, their check has to stretch farther and they can’t afford those kinds of principles.
I’ll assume that you identify with at least one of the four above. Take a look at how a Market Economy has bled into cultural values. Now bring it into relief against the alternatives: A company with a core value of ensuring a good standard of living for its employees as a higher priority than shareholder return; employees who reward the regard of their employer with loyalty, and who consider the health of the company when they consider the value of their own work; consumers who vote with their dollars and pay a little more because they believe in the person from whom they buy. Why don’t we see this more? In a classic tragedy of the commons, it is now common sense that anyone not using Market Culture values will lose out, that their business will fail, and that their employees and/or consumers will slide backwards.
But this mindset is changing. Social enterprise is making its way down to smaller companies. Cultures are changing a little at a time, but for the free market (again, something I consider to be a good thing in its right place) to be pushed out of the driver’s seat in our values, we will have to see more.
Hopefully, you can see that I’m not advocating for the abandonment of free market principles. The person that creates a product or service that ultimately advances humanity deserves to get pretty filthy rich in my book. What I’m advocating for is equilibrium. Let’s not get so hung up on short-term financial gain that we’ve set no other metrics for success, happiness, or abundance. Consider that when J.D. Rockafeller (the most wealthy man in the world at the time) was asked how much was enough, his reply was “Just a little bit more.” This alone should highlight that financial gain, in a vacuum, is a poor metric since it’s a moving target.
Consider your job. Your company. Your employees. Your shopping habits. Do they reflect your ideal world view? How can you make adjustments to get closer to that ideal? Start small. Make little changes. Let’s all set out to make enough money, but to also make something that’s better than just a paycheck. Decide how much is enough, and what outcome is truly important. You’re a lot more likely to hit that target anyway.