I am a devout fan of capitalism. It is the best system ever devised for making self-interest serve the wider interest. This system is responsible for many of the great advances that have improved the lives of billions—from airplanes to air-conditioning to computers.
Many of you know Jay Richards from his regular lecturing at Acton University. He has a newly co-authored piece in The Daily Caller, “Enterprise is the most ‘effective altruism.’” There’s more to be said on the complex issue of helping the poor than can be put in a single op-ed, of course, but there’s some great food for thought here, particularly for those who view business and markets as necessarily part of the problem. Jay and Anne Bradley use the example of Microsoft to explain the confusion:
The Gates Foundation has saved an estimated 5 million lives thus far. But we rarely hear of the countless lives saved or improved by the profit-seeking activities of Microsoft…. One effect is the Foundation itself. To be able to start such a large aid organization, Bill Gates first had to be a successful entrepreneur. As a philanthropist, Gates is not “giving back” to the world, as if he had taken from it in the first place. His philanthropic giving is possible only because he first “gave” as an entrepreneur.
… Microsoft succeeded only because they provided value for hundreds of millions of people. Gates had to meet the needs of his customers … And to stay ahead, he had to invest wisely rather than consume or give away all the profits.
He acknowledged that “[c]apitalism has worked phenomenally” and one need only look at North Korea vs. South Korea to see evidence of that. He also noted, “Capitalism has shortfalls. It doesn’t necessarily take care of the poor, and it underfunds innovation.”
Gates made several remarks to the British audience about the American tax system:
Just raising taxes on the rich won’t solve the crisis, but it seems reasonable to people – and there’s plenty of room to do that without creating disincentives or distortions.”
The news that the mega-rich Republican candidate, Mitt Romney, pays 15 per cent tax “wasn’t shocking at all. That’s the US system. If people want capital gains taxed more like the highest rate on income, that’s a good discussion. Maybe that’s the way to help close the deficit.”
What Gates failed to note is that the American government’s deficit problem is largely due to government over-spending, not under-taxing its citizens.
He announced at the time the article appeared that the Bill and Melinda Gates Foundation was making a $750 million donation to fight AIDS, malaria and TB in Africa, and was also focusing on helping subsistence farmers on that continent. (In July of this year, Melinda Gates announced a “family planning summit”, hoping to raise $4 billion to give more women access to artificial birth control, largely focusing on Africa and Asia.)
Interestingly, Gates said he didn’t expect the Foundation to continue very long after he and his wife were dead.
“Our foundation won’t last long beyond Melinda’s and my lifetime. The resources will last about 20 years after whichever is the last of us to go. There is no family business, and my kids will make their own careers.”
While Gates doesn’t downplay his role in technological innovation, he says the personal passion he once spent on entrepreneurship is now focused on ending disease and starvation for the world’s poor. The Telegraph article also focuses on some fascinating aspects of Gates’ relationship with long-time business rival Steve Jobs, especially in the months leading up to Jobs’ death.
I was reading about Bill Gates’ speech to the Northern Virginia Technology Council last week, which received a lot of media coverage (PDF transcript here).
In the speech about software innovation, Gates “speculated that some of the most important advances will come in the ways people interact with computers: speech-recognition technology, tablets that will recognize handwriting and touch-screen surfaces that will integrate a wide variety of information.”
“I don’t see anything that will stop the rapid advance,” Gates said. I appreciate the insight that a corporate mogul and business insider like Gates provides.
The predictions did make me think about this observation from Alasdair MacIntyre, however, which serves to temper some of the more audacious claims often made about technological progress.
Any invention, any discovery, which consists essentially in the elaboration of a radically new concept cannot be predicted, for a necessary part of the prediction is the present elaboration of the very concept whose discovery or invention was to take place only in the future. The notion of the prediction of radical conceptual innovation is itself conceptually incoherent.
To his credit, much of what Gates is describing doesn’t meet these criteria. They are not “radically new” concepts, but the integrative alteration of already existing concepts (some might argue that this has essentially been the modus operandi for Microsoft’s success: not innovation per se, but rather innovative popularization of integration).
That said, we need to be cautious about the precision of our claims about future innovation. Statistically we can predict that radical innovations are quite likely to happen, but by definition we can’t know what they will be.