Wednesday, October 06, 2010


A Lesson on Free-Competition from

Free-competition means freedom from physical force to produce for ones own profit.

What is free-competition?

Free competition is the freedom to produce, and the freedom to trade what one has produced, for ones own self-interest, i.e., in the pursuit of ones own happiness.

What is the foundation of free-competition?

Politically, free-competition is a consequence of the political right to life, liberty, property and the pursuit of happiness applied to the economic sphere of production and trade.

Morally, competition among producers is founded not on service to consumers -- which is a result; but, upon the pursuit of rational self-interest, i.e. the profit motive. Economically, its result is a free-market, i.e. free trade.

Observe that free-market competition presupposes a social system based on
individual rights -- and cannot exist without the protection of rights by government, e.g. what good is the right to produce (right to liberty) if one does not have the right to keep what one has created (right to property), the right to advertise what one has produced (right to free speech), the right to trade ones goods one ones own terms (right to property) and the right to benefit from what one has produced (right to the pursuit of happiness)?

Free-competition without
individual rights is a contradiction in terms, it is an oxymoron. Of course, if one is a communist, fascist or socialist (all are different forms of a single evil principle: collectivism) and does not believe in individual rights then competition has an entirely different meaning.

What is the difference between competition under capitalism and competition under all other kinds of societies (collectivist societies)?

All social systems have competition, the only difference is that in capitalism, all such competition for economic power results in the creation of wealth, whereas in collectivist societies such competition for political power results in the destruction of wealth.

Under capitalism, competition is an economic process where men do not compete to put down others, but to raise their self up by creating values which are potentially unlimited, and raising their competitors up in the process.

Under all collectivist systems competition is a political process where men compete not to create values, but to lobby or kill for positions of political power which they can use to legally extort the wealth of their fellow men.

Here's yet another great Orrin article explaining these principles in terms we can all relate to:

Competition, Excuses, and Free Trade
Competition ensures that winners won’t buy their own excuses.

Competition, a concept much loved by anyone attending a professional sporting event, seeks to have the best contend against the best for the enjoyment of all.  Top level competition reminds me of my youth, when NBA legends Larry Bird and Earvin “Magic” Johnson, both intense competitors and quintessential winners, were first entering the professional ranks.  The battles between the Lakers and Celtics became legendary as each team made constant adjustments to improve against the other.  The NBA turned into a fan favorite, selling out once empty stadiums, in a large part to the competitive greatness displayed by Bird and Magic.  Sadly, competitive greatness, this key ingredient to keeping a country productive, is being lost in the business world as entrepreneurs, fed on a diet of government subsidies and tariffs, become more like bureaucrats than business owners.  Can you imagine the outrage if, after a Lakers loss to the Celtics, the Laker team, rather than confront their lack of execution leading to the loss, instead chose to run to the California congress, seeking a tariff restriction against Celtic basketball the next time they entered California?  I can see the arguments now in congress, the Laker team provides jobs for Americans, it has been an icon in the NBA for years, we cannot allow Laker basketball to fail; therefore, we must support a tariff restriction against the uncompetitive practices of the Celtics, those egregious winners.  Ok, one might be thinking the author is getting carried away as there are no tariffs between states.  This is correct, certainly one of the best decisions our Founding Fathers made was to eliminate all tariffs set up to protect the states against competition from other states.  The Lakers are forbidden by law to seek protection against the Celtics and must learn to adjust to the competitive pressures applied by the Celtics, if they wish to compete and win. The Founding Fathers, although they understood the importance of each state having to compete on its own merits without tariffs, interestingly allowed tariffs on an international scale between countries, claiming the need to protect new American industries.  They agreed with competition within the country, improving the output, quality and price, but wavered in principle when discussing competition amongst countries.

Let’s revisit our NBA analogy with a twist,...   FULL ARTICLE HERE.