Some people say that the search for profit is abusive, heartless, evil, and so on. I’m not particularly in love with profit for its own sake (and I certainly don’t think it justifies abuse), but a reflexive condemnation of profit is deeply ignorant.
The truth is, profit killed the ancient abomination of human slavery. To eliminate the ability of people to profit would draw slavery back into the world. And we obviously don’t want that.
Here’s why:Slavery Was an Economic System
What is not understood is that slavery was the foundation of economics in the old world – such as in Greece and Rome.
Slavery was almost entirely about surplus. (Surrounded by creative justifications, of course.) It was a type of enforced thrift.
An undeveloped man, left to himself, will spend almost all of what he earns. If he does earn some surplus, he’ll likely spend it on luxuries, frivolities, or worse. Until he develops a strong character, little of his surplus will remain for other uses.
A slave, on the other hand, never holds his earnings in his hands and therefore cannot spend them. All surplus is transferred to his or her owner. It was precisely this kind of surplus that made Rome rich.
But then Christian Europe came about. Prior to that, I cannot point to a single ancient culture that forbade the practice; it was seen as normal. So, for Europe to expel the slavery it inherited from Rome was a monumental change.
Europeans replaced slavery – slowly and because of their Christian principles, not because of a conscious plan – by doing these things:
- Developing personal thrift. This required a strong focus on building up virtues like temperance (self-control) and patience.
- Replacing the enforced surplus of slavery with profit. That is, by mixing creativity in with their commerce: innovating, inventing, and adapting to get more surplus out of commerce.
Under a new system that was eventually tagged capitalism, thrift and creativity generated surplus, and no human beings had to be enslaved.A World Without Profit
On the other hand, we have recent examples of what happens when a culture forbids profit: the “socialist paradises” of Stalin’s USSR, Mao’s China, and the enslaved states of Eastern Europe. (Among others.)
These examples are bleak indeed, featuring the enslavement of everyone to a ruling party.
Profit provides an incentive to work, and when it is gone, not only does work suffer, but those who want to get ahead have no honest way to do it. And that drives them either to despair or to crime.
If you eliminate profit – innovative, rewarding commerce – you get slavery. The form of that slavery may vary from one case to another, but it will be slavery of some type.
This result is the same, by the way, whether the elimination of profit occurs via communism (make a profit, we shoot you) or fascism (all profit-making is taken over by friends of the state).
The core issue is surplus:
- If surplus can be gathered by average people via honest means, slavery can be eliminated.
- If average people are not allowed to create and hold their own surplus (surplus being skimmed off to the state and/or state partners), slavery of one sort or another will be the result.
Profit is simply a tool – a way of generating surplus without the enforced thrift of slavery.
You cannot get rid of both slavery and profit. You can eliminate whichever one you wish, but you’ll be stuck with the other.Profit Rests on Virtues