Even Occupy Wall Street cannot fight the inherent need in individuals to prosper from their work, as evidenced by a scattering of news reports and videos. Capitalism, the very system that the protestors are railing outwardly against
is the system th
at they appear to yearn for within the OWS organization. Socialism, the system they are trying to promote, is creating dissension within their ranks. Altruism do-goodism and wealth redistribution only go so far when individuals run out of goods, services and the will to produce. Consider some recent developments:
- Occupy Tuscon is being choked by food permit rules that keep ordinary entrepreneurs from selling food for profit out of their homes.
- Occupy Wall Street kitchen staff are tired of working 18-hour days providing food for “freeloaders.”
- Occupy Wall Street drummers are threatening to splinter off over financial conflicts with the General Assembly. After giving up the majority of their collected donations to the Finance Committee, their request for $8,000 in new drumming equipment was rejected.
- Peter Schiff, CEO of Euro Pacific Capital, asked the protestors what his “fair share” of taxes should be. They could not come up with an answer.
What lessons can be learned from the Occupy protests? First, the grievances over government’s involvement in subsidizing the private sector through corporate bailouts are valid. If mismanaged firms are propped up and rewarded for bad behavior, they will continue down the same failed path. Whether the protests will change anything of significance in this area remains to be seen.
However, the lessons that are not printed on the signs or shouted through the megaphones are far more important:
1) Socialism is a failed economic policy. Individuals who work for the good of society but not for themselves will eventually encounter the free-rider problem and produce less or stop producing at all.
2) Altruism in and of itself does not meet people’s needs. In order for people to truly have their needs met, they must have the freedom to produce, sell and purchase without fear of confiscation. Developing countries grow not because a non-governmental organization goes in and distributes food, but because they have economic freedoms and secure property rights that enable them to develop and market their talents.
3) Proponents of wealth distribution love the idea — that is, until their own wealth is distributed without their consent. Just ask the Occupy protestors who have collected money for the Finance Committee that they never see again. Ask those who have had valuable goods stolen during the protests.
4) The idea of a “fair share” of taxes is intangible. Even when CEO Peter Schiff asked demonstrators what percent of his income he should pay in taxes, nobody provided him a clear, concrete answer. While many favor a progressive income tax system, attempting to define a “fair share” is wildly subjective and can hardly be quantified.
5) Government regulations, not the top one percent, keep ordinary people down. The top 1 percent got there in spite of the urdles they faced through burdensome regulations and a complicated tax system (although perhaps a few of them were lucky enough to receive tax-payer funded subsidies).
Sadly, not everybody has the patience, fortitude and wherewithal to deal with the bureaucracy, so many who would like to create a niche for themselves in the world of entrepreneurship will give up trying.