Using coercion instead of respecting choice; mistaking charity for gratitude.

When you are working in the free market where people choose to purchase your goods and services from you, you can know that you are providing a desired thing and that you are making the other person's life better. They are giving up something of value to them (money) in order to have something you have produced which is of even greater value to them. We don't think of it in this way - we are just doing business. But the free market with associated price signals is a fantastic and incomprehensibly complex mechanism which both optimizes well-being as well as optimizes efficiency.

How cool is that?

Yet we take it for granted and it is always under sustained assault by people who are very comfortable assuming that they know better than others and that that there is some cosmic reason justifying that they should be allowed to coerce people into making different choices. These are the Social Justice Jacobins. Their arrogance and corresponding errors are astounding but they, like the poor, are always with us.

Then you have the privileged do-gooders. Also people who assume they know better than everyone else. They do not have the power of coercion but they do have the power of their own money (or that of others, too frequently unassuming tax-payers) which they spend to encourage people to make different decisions than they otherwise would.

These pathological altruists feel they are doing good but almost always make things work. They do not know enough about the complex system with which they are interfering. If they are able to sway with money some poor individuals, it almost ends up that the poor suffer and the privileged altruist escapes harm or censure.

I have always tended to think of them as well-intended bad eggs. Individuals who are tending their own sense of status or psychological well-being at the expense of their victims.

Alex Tabarrok has an interesting review of a book by the same name as the title of his Post, Thanks a Thousand. This passage is a great reminder of the moral foundations of an open market. Emphasis added.

Jacobs sometimes forgets, however, that the value of gratitude is more in the giving than in the receiving. He thus confuses gratitude with charity. But gratitude is neither payment nor alms. It’s nice to be recognized and thanked but thanks don’t make the world go round.

I ask Andy whether it feels good that the coffee in his warehouse brings joy to millions of people. Andy looks at me, his eyebrows knit. It’s as if I just asked him if he enjoys being a Buddhist monk who mediates ten hours a day.

“Well let me ask you this,” I say, “What are you thankful for?”

“My paycheck,” he says, laughing.

I like Andy. Andy understands that working solely for the sake of others can be demeaning and degrading. Andy is working for himself and his loved ones and more power to him. Beyond a few special relationships, to make doing for others one’s primary motive is undignified and subservient. Humans are not worker ants eager to die for love of their Queen. Each person’s life is their own.

Of course, it is an age-old wisdom we can recognize from a quarter of a millennium ago when Adam Smith said.

But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and shew them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity, but to their self-love, and never talk to them of our own necessities, but of their advantages. Nobody but a beggar chooses to depend chiefly upon the benevolence of his fellow-citizens.

When you are in the free market working and respecting the rights of your free fellow citizens and you are successful selling your goods or services, you know you are making the world better. It is when people confuse coercion for choice and charity for gratitude that things start to go astray.