Thomas Sowell

Those who rail against profits and "greed" seldom stop to think through what they are saying, much less go check the facts. Most of the great American fortunes-- Rockefeller, Ford, Carnegie, etc. -- came from finding more efficient ways to produce a product or service at a lower cost, so that it could be sold at a lower price and attract more customers. If making a fortune represents greed, then greed is what drives prices down.

None of this matters to people who have been conditioned to respond to the word profit automatically, as Pavlov's dog was conditioned to respond to certain sounds.

"Never speak to me of profit," India's legendary leader Pandit Nehru once said to that country's leading industrialist. "It's a dirty word." Policies based on that attitude cost millions of Indians a better life for decades, by stifling India's businesses.

Indian businesses flourished around the world -- except in India. Only after India's severe restrictions on business were lifted in the past dozen years has its economic growth taken off, creating rising incomes, employment and tax revenues. This poverty-stricken country could have had all those things 40 years earlier, except for a prejudice against a word.

Unthinking prejudices and suspicions about profits is often matched by unthinking gullibility about "non-profit" organizations. No matter what money may be called, both individuals and organizations must have it in order to survive.

Businesses get their money from those who buy their goods and services. Non-profit organizations are crucially dependent on money from other people -- either voluntary donations, tax money from the government, or money extracted from businesses through lawsuits.

Where there is a product or service of widely recognized value, such as education or medical care, schools and hospitals can attract donations on that basis. But there are other non-profit organizations which can survive only by inspiring fears and anger that bring in donations.

For these kinds of non-profit organizations, the sky is always falling or we are threatened with seeing the last few patches of unspoiled land paved over for shopping malls, virtually everything is "unsafe," we are running out of natural resources, and air and water are becoming dangerously polluted.

Thomas Sowell

Thomas Sowell is a senior fellow at the Hoover Institute and author of The Housing Boom and Bust.

Creators Syndicate