Never Forget That We Aim to Create Wealth Because It Leads to a Better World
We do not create wealth because we love money. We create wealth in order to create a better life for ourselves and future generations. That is what the Trump Administration seems to fail to grasp.
RealClearMarkets editor John Tamny has explained that the purpose of wealth creation is the “getting.” Our goal is to obtain something. But what we are trying to obtain is not a collection of gadgets; rather, it is happiness, stability, health and security. Technologies like smart phones, laptops and the Internet just helps us attain that goal - as do MRIs, scans, lithotripters and medications.
The true purpose of wealth creation seems to be what President Trump - and his anointed Mideast peace adviser and son-in-law - fails to grasp. Trump was at it again on the weekend. When Meet the Press host Chuck Todd asked Trump why the United States is selling arms to Saudi Arabia, despite the fact that Saudis brutally murdered an employee of an American organization (not to mention the long, deep trail of blood they leave) his answer was classic Trump: He asked Todd if he knows how much money the Saudis spend for U.S arms and other goods. As though that is all that matters.
While no one wants to run afoul of Godwin’s Law (the first side in a debate to mention Hitler loses), it is worth asking: Would one also respond to questions about trading with Germany in the 1930s simply by referring to its economic weight? Indeed, some U.S companies did believe they couldn’t ignore Germany’s economic muscle, and traded with the Nazis - to their everlasting shame.
Unfortunately, this mercantile attitude is not an aberration for Trump. He has consistently pursued the same one-dimensional faith in money. It underlies his tweet on Monday morning arguing that the United States doesn’t need oil, so the Chinese and Japanese should bear the physical and financial cost of keeping the Persian Gulf flowing. If all you care about is the short-term pursuit of money, why should the world’s greatest power bother to pursue global stability? Not to mention why would we not want China, or even Japan, to be that powerful. (The obstinate belief that oil prices in the United States are somehow divorced from the security of the Persian Gulf is a consequence of economic illiteracy.)
This obsession with money also colours Trump’s attitude about trade - sell more, buy less, even though the goal of exporting is purely to be able to import.
Many talk of people who are good at business as having a ‘Midas touch.’ But let’s not forget that parable ended with a deeply unhappy King Midas losing his daughter by turning her into gold. Is that really a model one wants to emulate?
The Midas complex is of course not restricted to Trump. Jared Kushner seems to share it. His Mideast peace proposal is based on the notion that everyone is driven by money, as an end in itself. Under the Kushner plan, wealthy countries would pour $50 billion into a new Palestine - as though money drives out all other problems. But the $50 billion nest egg is really just an updated version of the $30 billion President Clinton offered almost 20 years ago - pegged to inflation. The Palestinians turned that down; this time, they have made it clear they will not even attend the planned conference - and Israel might also skip it.
As the saying goes, man does not live by bread alone - nor do nations. Many of us would regard ourselves as
Homoeconomus. We believe in the importance of constantly improving mankind’s ability to create wealth. But we don’t seek to create wealth for its own sake; we seek to create wealth because it leads to a better world.