In this article, Mary Jane, who has an academic background in Philosophy, shares her thoughts on the consequences of a free market economy. She believes that when the industry starts creating more problems to people, so that they can sell more of the solution, that’s a failed system.
A Successful Enterprise
A successful enterprise is the one that has been able to identify a problem people have and has built a system to be able to provide a solution to that problem. People can’t find good bread in the town of Kingston? Let’s open a high-quality bakery in Kingston and solve their problem finding good bread. People have savings but they are afraid of getting robbed? Let’s open a bank and give them the opportunity to put their money in a safe place. People burn their hand when holding a coffee cup? Let’s give them a paper ring to put around the cup so they don’t burn their hand. Find a problem people have, make up a way to sell them a solution, and you’ll have a successful enterprise.
The Consequences of Industrialization
When industrialization came, it allowed enterprises to make more of the same thing at less cost. I don’t need anymore to hire a bunch of people who cut paper strips and glue them together in a paper ring for coffee cups, now I can buy machinery that do the same job in less time and at a lower cost. If I’m industrialized – if I have the necessary industrial machinery – I can scale my enterprise and make it progressively bigger.
The Problem with Exhausting the Fuel
All nice and linear so far, but here comes the issue. What happens when an enterprise becomes so big, that it manages to solve the problem of all people? I’m talking about that problem that people had, that the enterprise was born to solve. That problem is the fuel of the business. If the business starts going so fast, that it exhausts the fuel it needs to be running, before that fuel naturally becomes available again, what happens? Will the enterprise close, because it finally solved the whole problem? Will it slow down its business, waiting for more people to have a problem to solve? Have you ever seen a company intentionally slowing down their business? I haven’t.
Creating More Problems
I think the enterprise will be left with only one way out: creating more of the problem. They will create more problems for the people, so they’ll have the need for a solution, and at that point the enterprise is going to be there, as always, ready to solve their problem. Ready to acquire more customers and therefore more business opportunity.
An Example from the United States
This is exactly what I observe in the United States now that I live here. For the record, I come from Italy, also a capitalist country with a free market economy, at least in theory. But in Italy we look up at the United States as a country with a true capitalistic, free market economy and that’s something that I also observe, living here, that American economy applies way more the principles of libertarianism and free market. Pharmaceutical and medical companies, for example, which are both private sectors in the American economy, show to have all the interest in creating more problems for people, so they can sell more of the solution.
In conclusion, Mary Jane believes that when the industry starts creating more problems to people, so that they can sell more of the solution, that’s a failed system. She believes that a successful enterprise is the one that has been able to identify a problem people have and has built a system to be able to provide a solution to that problem.