PrintJanuary 21, 2007
Biting the hand
Graham Cunningham's fascinating essay observes that left-wing anti-bourgeois invective originates in the academy. I have often wondered about this and suggest that part of this anti-commerce culture derives from the tradition in British Universities in which Oxbridge Dons were aristocratic gentlemen scholars, the second sons of families whose wealth derived from great landed estates, and who viewed "tradesmen" as beneath contempt (not least because they associated with Jews).
Furthermore, to leftists, "corporate profit" is a dirty word implying funds doubtlessly stolen from exploited peasants on third-world plantations - for where else could this extra money derive in the left's zero-sum view of economics? Could this profit-stigma be a remnant of medieval anti-usury laws? Clearly, academics have little understanding of modern industry, international trade, and wealth formation. This ignorance then permeates our culture.
Furthermore, to leftists, "corporate profit" is a dirty word implying funds doubtlessly stolen from exploited peasants on third-world plantations - for where else could this extra money derive in the left's zero-sum view of economics? Could this profit-stigma be a remnant of medieval anti-usury laws? Clearly, academics have little understanding of modern industry, international trade, and wealth formation. This ignorance then permeates our culture.
Mr. Cunningham highlights the vast increase in wealth created by modern electronics, wealth so ubiquitous and ever increasing (even in the third world) that most of us just assume now that we will always benefit from ever smaller cell phones, ever faster computers and networks, and ever more sophisticated video games. How is this wealth created?
Gordon Moore noted in 1965 that the density of transistors on integrated circuits doubles every two years reducing their cost by half. Mr. Moore is among those surprised at the accuracy over forty years of his eponymous "Law" - the results of which played a major role in the West's Cold War victory. But what kind of Law is it? A Law of Physics? A Force of Nature? No, it is an economic law - a visible manifestation of Adam Smith's "Hidden Hand". Moore's Law results every year like clockwork from intense, uncoordinated, costly, risky, ruthless yet lawful international commercial competition among companies such as Intel, Texas Instruments, AMD, IBM, Motorola, Sony, Hitachi, Matsushita, etc, etc. and a myriad of specialist supplier companies, including behemoths such as Applied Materials.
Many companies have been put out of business by their stronger competitors as is supposed to happen in capitalism (of course, their laid-off expert employees are welcomed at other companies). There is no government coordination or direction by central committee. Market participants are free to innovate as they choose, motivated by self-interest. Although there is cooperation on basic R&D and industry standards, corporate trade secrets and intellectual property are guarded carefully and exploited ruthlessly in attempts to bash the competition. As a result, silicon is by far the most thoroughly studied substance in the universe. Millions of PhD hours are directed every year toward its research and development.
Many companies have been put out of business by their stronger competitors as is supposed to happen in capitalism (of course, their laid-off expert employees are welcomed at other companies). There is no government coordination or direction by central committee. Market participants are free to innovate as they choose, motivated by self-interest. Although there is cooperation on basic R&D and industry standards, corporate trade secrets and intellectual property are guarded carefully and exploited ruthlessly in attempts to bash the competition. As a result, silicon is by far the most thoroughly studied substance in the universe. Millions of PhD hours are directed every year toward its research and development.
This incredible specialization and division of labor creates tremendous wealth as anticipated by Adam Smith. This wealth provides a snug, comfortable, economic environment for self-hating liberals. Third world peasants play absolutely no role except as willing customers of inexpensive electronics made affordable as a consequence of Moore's Law and the West's vigorous market economies. Sadly, most academics would rather study Marx.
Sincerely,
Jerry Schmitt
