Intention is not Result

It has been argued that the market is imperfect. The market may create wealth and interference in the market may hinder wealth, but if wealth is not well distributed, if some individuals fall through the cracks, then we must find another solution to help those individuals. If the intention of market is to help the many but not all and some fall through the cracks, then the answer would be to use another tool, one that has the intention to help those few.

Or anyway, if intentions were results this might be the case. But they aren’t.

Socialists claim that some economists have a “naïve idealization of the market.” Somehow we think that the market can solve everything, but it is wishful thinking. To think that government should keep its hands out of the market is then naïve. But it doesn’t require a naïve image of a perfect market to recognize that government could potentially make things worse by interfering; nor does it require an idealized view of the for-profit companies performing functions that are best performed by charity and family to see that government should not perform those functions either.

One need not think that marketplace fairies will take the place of for-profit businessmen and magically turn greedy, profit-driven firms into benevolent, efficient charitable friendly neighbors with pixie dust, bringing wealth beyond our wildest dreams to the poor; one only need see that government isn’t made up of fairies either. It is no less naïve or idealistic to think that government can perform these functions, becoming suddenly non-political, non bureaucratic, no longer driven by power, corruption and greed, and magically turned with pixie dust into friendly neighborly charities.

So, the intention of individual firms are that they profit – yet, with this intention they are able to create jobs and wealth, new technology, innovations and all kind of other positive externalities. The intention of government is to protect the people, perhaps to provide them with things; the result has been mixed – in some countries it has become very corrupt, it has not fulfilled its intended duties at all. In many cases when government creates programs to help the poor, the result is that more people fall below the income cutoff level and then the program must expand to help them, the cycle continues and it becomes unclear whether any poor have been helped, or whether we are just subsidizing the poor – and hence creating many more.

So, if we want to help the few that slip through the cracks in the market system, we have several choices: for-profit firms, non-profit charities or government. Each has intentions and each have produced results. Rather than assuming that one or another will do a better job simply because of its intentions or its size, why not attempt to look at the outcomes that each have been able to produce.