Greed

Some may wonder what would happen if Able turns out to be a really greedy guy, who would use his new wealth just to get richer and richer.

Is this really a danger? If the only way to make his savings grow (without working himself) is to make it available to other members of the community, why would he hoard it?

Otherwise his wealth will stay the same or get smaller as he personally consumes it! The best thing about private capitalism is that it forces those who may only be motivated by personal gain to raise the living standards of others.

— Peter Schiff; How an Economy Grows and Why It Crashes

In an era when our media and even our education system exact emotions, while ignoring facts and logic, perhaps we should not be surprised that so many people explain economics by "greed."

Today there are adults - including educated adults - who explain multimillion-dollar corporate executives' salaries as being due to "greed."

Think about it: I could become so greedy that I wanted a fortune twice the size of Bill Gates' - but this greed would not increase my income by one cent.

If you want to explain why some people have astronomical incomes, it cannot be simply because of their own desires - whether "greedy" or not - but because of what other people are willing to pay them.

The real question, then, is: Why do other people choose to pay corporate executives so much?

— Thomas Sowell; Dismantling America

Many observers who say that they cannot understand how anyone can be worth $100 million a year do not realize that it is not necessary that they understand it, since it is not their money.

All of us have thousands of things happening around us that we do not understand. We use computers all the time but most of us could not build a computer if our life depended on it -- and those few individuals who could probably couldn't grow orchids or train horses.

In short, we all have grossly inadequate knowledge in other people's specialties.

The idea that everything must "justify itself before the bar of reason" goes back at least as far as the 18th century. But that just makes it a candidate for the longest-running fallacy in the world.

Given the high degree of specialization in a modern economy, demanding that everything "justify itself before the bar of reason" means demanding that people who know what they are doing must be subject to the veto of people who don't have a clue about the decisions that they are second-guessing.

It means demanding that ignorance override knowledge.

The ignorant are not just some separate group of people. As Will Rogers said, everybody is ignorant, but just about different things.

Should computer experts tell brain surgeons how to do their job? Or horse trainers tell either of them what to do?

— Thomas Sowell; Dismantling America

Among corporate CEOs, those who cash in stock options that they have accumulated over the years get a big spike in income the year that they cash them in. This lets critics quote inflated incomes of the top-paid CEOs for that year. Some of these incomes are almost as large as those of big-time entertainers — who are never accused of "greed," by the way.

— Thomas Sowell; Dismantling America

It is not even that the average corporate CEO makes as much money as any number of professional athletes and entertainers. The average pay of a CEO of a corporation big enough to be included in the Standard & Poor's index is less than one-third of what Alex Rodriguez makes, about one-tenth of what Tiger Woods makes and less than one-thirtieth of what Oprah Winfrey makes.

But when has anyone ever accused athletes or entertainers of "greed"?

— Thomas Sowell; Dismantling America