How Do We Defeat Racism and Discrimination Once and For All?

....Why, Capitalism, Of Course!

We haven’t heard a lot lately about discrimination in the job market. Perhaps the economic crisis has pushed it into the background. “Progressives” may be too busy promoting their economic gibberish (Keynesianism) to fall back on this tried and true “divide and conquer” issue. However, as surely as night follows day, there will come a time when our friends in Congress will again need a different reason to try to tell people how to conduct their business, and nothing garners more support than railing against discrimination. When that shoe finally drops, I have a suggestion. Let’s not go back down the road of affirmative action, quotas, or any other idiotic idea that our retro-liberal Congress is likely to resurrect. There is only one remedy for discrimination in the workplace: free market capitalism.

I can speak from personal experience that this is true. I have interviewed thousands of people for jobs over the course of my life. The candidates were black, white, Hispanic, male, female, young, and old. How did I decide who to hire? I chose the same way every time. I picked the candidate that I believed would make me the most money. When I chose a black candidate or a woman, I did not do so because I wanted to promote diversity or equality. I did not do it out of altruism or for women’s rights. When I made those decisions, I had one thing and one thing only on my mind – profit.

Sometimes, I chose a white male over a black female and didn’t give it a moment’s thought. Sometimes, exactly the opposite was true. Nonetheless, in each case I chose based purely on my own self-interest (or that of my employers). I did not hire people to help them and they did not come to work for me to further some missionary cause (or even because of my sparkling personality, believe it or not). They came to work for me because the opportunity I offered them would benefit them personally more than any other available to them at the time.

The people that have worked for me in the past and who work for me now are my equals. They have skills and services to sell and I am their customer. We deal with one another in the same way that people deal with one another when buying or selling a house. I am looking to get the highest quality work that I can for the best price. They demand the highest price that they can get for their services. They choose to sell those services to me because I am willing to meet their price. If they call me “Mr.” or “Sir,” it is not out of subservience any more than the owner of an exclusive restaurant is subservient when he calls you “Sir” or “Madam” while you are paying him $150 per plate. When someone buys your product, you show gratitude for the high compliment they have paid you. They have chosen what you have to offer over all other alternatives.

Were I to make hiring decisions based upon anything other than the profit motive –based upon racial discrimination for example - the market would punish me. It would reward my competitor with a more talented employee and an advantage in the market. If I were to do this habitually, my competitors would soon have more talented employees throughout their organizations and I would be forced out of business. Anyone who has run a business knows that one cannot afford to discriminate based upon anything but profit. The market forces me to ignore race, creed, or sex for my economic survival. Only politicians remind me that I should consider demographics.

The plain fact that no politician in history has ever understood is that the market requires no altruism for everyone to benefit. Competition for employees creates higher wages and better benefits. If competition for jobs drives wages down, then the cost of production drops with wages and real wages rise despite the nominal decrease. There is no need to “balance” profit and social justice. The profit motive creates social justice. People exchanging their goods or services with one another by mutual, voluntary consent is social justice. It is only coercion that is unjust.

When people are left to themselves to deal with one another by mutual, voluntary consent, the profit motive will trump racism and discrimination every time. Show me a firm that passes on superior talent because of race or sex and I will show you a firm that is not going to be around for very long. Show me an entire industry that has put the best talent on the sidelines due to race, sex, or age, and I will be open for business in that industry the very next day. Within six months, I will be that industry’s next billionaire. The company with the most talented employees wins - every time.

This relationship between employer and employee – between buyer and seller of services – is one based upon all parties acting in their own self interest. My employees do not need my help or my altruism – they need my business, just as I need the business of my customers. They strive to perform at the absolute highest level that they can so that they can demand even more money from me for those services. I happily pay it when their improved performance increases my sales or my profits. I offer less when I can get the same performance at a lower price.

The beneficiaries of all of this are our customers. I am constantly trying to lower my costs and raise the quality of my products. I do this to gain market share and increase profits. My employees continually improve their service to our customers so that they can make more money for themselves. Higher performance from my employees is what raises the quality of my products.

Neither I nor my employees bother to stop and take note of the color of anyone’s skin or whether they are a man or a woman. We cannot afford to and, quite frankly, we just don’t have the time. This is the way the real world works. Just ask anyone who has to make a living in it. Only politicians and the people they are able to confuse see it any differently.

So, the next time your politicians bring up discrimination in the workplace, try to explain all of this to them. Tell them to put away their pamphlets and spend some time with you - working for a living. Six months spent actually earning a living rather than living off taxes collected at gunpoint would make capitalists of them all. You may say I’m a dreamer, but just imagine the freedom and prosperity that would result.

Check out Tom Mullen’s new book, A Return to Common Sense: Reawakening Liberty in the Inhabitants of America. Right Here!

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