Beware Of Corporate Do-Gooders
The following quote is from page 95 of Benjamin A. Rogge’s February 27, 1976, op-ed in the Indianapolis News titled “The Bicentennial of Economic Liberty,” as this essay is reprinted in A Maverick’s Defense of Freedom, the 2010 collection of Rogge’s essays that is edited by Dwight Lee:
I would add that I trust the businessman only when he’s out to make money – because then he’s going to want to do things my way. When he’s out to do me good, he is going to do it his way.[Exclusive] ExodusPoint Is In The Green YTD Led By Rates And EM/ Macro Strategies
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The context of this quotation makes clear that when Rogge writes “when he’s out to make money,” he means when the businessperson is seeking profits by competing in the private market for consumers’ patronage (rather than when the businessperson is seeking rents by pleading for, and getting, special privileges from the state).
The beautiful truth of Rogge’s statement is vital. Business people earn profits in the private market only by pleasing others – consumers as well as workers and other input suppliers – as these others judge matters. In contrast, someone seeking to do good for another person too often is guided chiefly by his or her own notion of what is best for the other person and, thus, discounts – or utterly ignores – the wishes and assessments of the other person.
As Bob Murphy put it, in a private market, the higher a businesses’s profit, the more good that business is doing for humanity.
Donald Boudreaux is a senior fellow with the F.A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics at the Mercatus Center at George Mason University, a Mercatus Center Board Member, a professor of economics and former economics-department chair at George Mason University, and a former FEE president.