Equally unequal (Feb Posting)

Notable Austrian economist Ludwig von Mises writes in Economic Policy, “And people are different, they are unequal. They always will be.” Mises continues, “There are some people who are more gifted in one subject and less in another.”

It’s reasonable to believe that Mises would have had his throat jumped down by social psychologists because of this particular position. Today, we are told by professionals and academics that creating a separation between those who excel and those who can’t only hurt our society in the long run. The mantra “everybody is equal” and “everybody is special” has been promoted since I’ve been alive; perhaps it’s been promoted even longer.

Look, I’m not a gifted student. I’m not a gifted athlete. Hell, my wife tells me that I’m not a gifted lover, but I’m okay with these truths. I would rather know the truth or hear the truth than believe a lie that “we are all equal.”

I’m glad we’re not all equal. I’m glad we, as a society, have different gifts, talents, and abilities. I wouldn’t want to watch the Super Bowl with two teams with rosters full of people like me. That would be incredibly boring! I’m glad there are people smarter than me that conduct incredible research, write fascinating books, and create things for me to buy, wear, and drive.

According to Mises, it’s the people who don’t follow the status quo that perpetuate the success that is Capitalism. Mises writes, “If a man has an idea, he will try to find a few people who are clever enough to realize the value of his idea.” Many people have ideas. Some ideas will never materialize into products or goods. Other ideas become products or goods but really should have stayed in the idea phase of creativity (anybody remember the Vibrating Ab belt?)

The entrepreneur, because of his or gifts, talents, and abilities, makes use of the Capitalist economy for his or her benefit. He or she may see an avenue in which a current product or process can be perfected. Or he or she may invent a product, sell it, and reap a handsome profit. And all the while the entrepreneur may or may not pay others for their expertise and knowledge and insight.

Either way, society is better off because the entrepreneur did something other than follow the status quo. Society is better off because the entrepreneur took risk, assessed the future, analyzed the past, and made decisions. The entrepreneur is the driving force of change in the dynamic economic system. And, as was discussed in class, the role of the entrepreneur is constantly overlooked by neo-classical economists.

People are different and people are unequal in talents, abilities, and skills. The entrepreneur recognizes this and utilizes this truth to his or her advantage. The entrepreneur may have a vision, but he or she certainly surrounds themselves with qualified staff to execute that vision. In this case we how differing talents, abilities, and skills are orchestrated and implemented to build a business, sell a product, or provide a service.

People are different and people are unequal…it’s truth.