In a world full of both great material wealth and social inequality, we are always torn between the pursuit of self-interest and common interests. The idea of self-interest is always interpreted as selfish and anti-social. Self-interest is often synonymous with greed, which is a trait that can easily be found in some people who already acquired more wealth and power than the rest of society combined. This debate about self-interest is not new; throughout history, there are always arguments about how all the remarkable achievements of human civilization are results of self-interest while the opponents of this view argued about the devastating consequences like economic crises and inequality. We do not need to have to be so polarized into thinking that only one philosophy, either self-interest or common interest, can be applied in our life, there are countless examples on how both can coexist harmonically. In this essay, we will see how the pursuit of self-interest has done significantly more than directly aiming for the common interest.
The self-interest philosophy has never been that selfish. It stems back in 1776 where Adam Smith first analyzed about self-interest for the purpose of explaining how the market works. In his book, The Wealth of Nations, he argued that “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our necessities but of their advantages.” (“The wealth of nations”, p.30). It is not always from a direct action of common interest, but through acting self-love that we can fulfil others need. This seemingly counterintuitive approach to achieve common goods is actually one of the most natural occurrences we can found in almost all society throughout history. The reason we are able to fly from Hong Kong to San Francisco in less than 20 hours is that the airlines want some part of our wealth for their own benefits. We even still get to choose which price fits the most for us or which airline has the most comfortable seat inside their plane. The idea strengthens as Smith also states in the same book, “Every individual… neither intends to promote the public interest, nor knows how much he is promoting it… he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.” (“The wealth of nations”, p.593). Our living standards are better than kings of the past because inventors turn dreams into reality, and companies make that reality affordable so we can trade with them according to our own self-love.
Some companies want to make as much money as possible, while some others want to hopefully achieve a monopoly. The reason we are able to have our own computer is that some company made it smaller, cheaper, and easier to use than the first models of computer. They excel so far in what they are doing that they are in a path of turning into a monopoly. Companies that managed to achieve monopolies did not use some kind of illegal forces to capture the majority of the market and establish dominance. It is through creating products that nobody else has created but are needed by everyone. We see this in big firms like Google or Amazon, where their services are far superior compared to their competitors that they are able to establish a monopoly. It is not from the benevolence of these companies that we expect our reliable search results and great service, but to their self-love, and never talk to them of our necessities but of their advantages (“The wealth of nations”, p.30). Now, both Google and Amazon are valued over $1 Trillion, making them one of the most valuable technology companies of all time (Wakabayashi, 2020).
The pursuit of personal riches is not without a flaw, and it has created widespread inequality across all country. With all the riches accumulated by some people, we still see poverty everywhere. Low-income neighbourhoods are everywhere around luxury towers, and wealthy families are living an extremely lavish live while the poor are struggling to live even though cheap commodities are everywhere. In 2017, the top 1% of the richest people in the world owned more than 50% of the world’s wealth (Frank, 2017). The next year, 2018, the 26 richest people on earth had the same net worth as the poorest half of the world’s population. Given these great inequality problems, promoting self-interest does not seem to be the best solution for the well-being of the people.
The great wealth and income inequality are not something that only happened in recent years, the German philosopher and economist Karl Heinrich Marx had seen it since the early 19th century. One of his arguments is seen in Economic and Philosophic Manuscripts, where he argued: “The worker does not necessarily gain when the capitalist gains, but he necessarily loses with him”. (“The wealth of nations”, p.593). This can explain why the rich are in the position of power to gain as much wealth as they can possibly generate in a short amount of time. While the owners of the company are able to increase the company’s value and multiply their own wealth, the workers will still be living with the same condition. The workers are often not in a position of power to ask for a raise, because the owners will easily find other people that are able to replace them. Everyone in the company will struggle if the company fails, but not at the same degree. The owners may lose money, but workers are losing their job. As Marx stated, “In general, we should note that where worker and capitalist both suffer, the worker suffers in his very existence while the capitalist suffers in the profit on his dead mammon” (“Economic and philosophic manuscripts of 1844”, p.218). The rich do not lose as much as the poor when the economy fails. This phenomenon might be the most frequent thing to happen in times of crisis, but certainly not the most supportive of the ideals of equality in society.
The idea of Marx is widely applied in socialism, which and idea pursues the abandonment of commoditization of labour and the inequality that is created. Socialist’s market generally discourages private ownership, and by that, it means that innovations and producing capacities are stunted because the state controls the production. Goods and services are produced according to the state, thus eliminating the demand-based market. As we can see, this idea opposes the philosophy of self-interest. This common good ideal exists to pursue the well-being of all people, as opposed to the self-interest that seems to only benefit the richest. This idea seems good until The Soviet Union disintegrates, while most capitalistic countries continue to generate more wealth.
In the modern world, it is critical to balance between keeping people from poverty and letting the market work itself out to distribute and create wealth. It is the idea of liberty and equality that we look to balance out. Jean Jacques Rousseau had this figured out in his Social Contract & Discourses (1913), he stated that “If we ask in what precisely consists the greatest good of all, which should be the end of every system of legislation, we shall find it reduce itself to two main objects, liberty and equality—liberty, because all particular dependence means so much force taken from the body of the State, and equality, because liberty cannot exist without it.” (“Social Contract & Discourses”, p.189). The major reason of the advancement of modern civilization is because the state can guarantee liberty to all people. If the state control too much aspect of the economy, then the productive force will be stunted and the rich will be incentivized to leave the country and move to somewhere else that can ensure liberty so they can generate more wealth. If the state gives up too much power to the market, then we will see more exploitation that will lead to inequality. As stated by Rousseau, the state needs to ensure equality because liberty cannot exist without it. The society that successfully managed to balance equality and liberty will be prosperous and dignified.
In conclusion, the pursuit of self-interest has made a great amount of contribution. Its existence had proven to generate riches throughout history and set a higher living standard than the generations before. The idea of self-interest cannot be applied solely in a state because it can create inequality and exploitation. It is state’s duty to balance between liberty and equality, so the civilization may continue to generate riches without the need of any inhumane exploitation.
- Smith, A., & Cannan, E. (2003). The wealth of nations. New York, N.Y: Bantam Classic.
- Wakabayashi, D. (2020, Jan 16) Google reaches $1 trillion in value, even as it faces new tests. New York Times. Retrieved from: https://www.nytimes.com/2020/01/16/technology/google-trillion-dollar-market-cap.html
- Frank, R. (2017, Nov 14) Richest 1% now owns half the world’s wealth. CNBC. Retrieved from: https://www.cnbc.com/2017/11/14/richest-1-percent-now-own-half-the-worlds-wealth.html (accessed May 13, 2020).
- Marx, KH. (1987). Economic and philosophic manuscripts of 1844. Buffalo, N.Y: Prometheus Books.
- Rousseau, J. J. (2002). The social contract and the first and second discourses. London: Yale University Press.