Quotation of the Day…

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… is from page 289 of Israel Kirzner’s 2004 paper titled “Economic Science and the Morality of Capitalism” (available here), as this paper is reprinted in the 2019 collection of some of Kirzner’s papers (edited by Peter J. Boettke and Frédéric Sautet), Reflections on Ethics, Freedom, Welfare Economics, Policy, and the Legacy of Austrian Economics:

The truth is that profit-maximising business firms, charging the highest possible prices, and paying the lowest possible wages, would emerge in the purely saintly society in exactly the same way as in ours. The profits won in business activity would, in the saintly world, no doubt be dedicated to lofty, saintly, philanthropic purposes, instead of being devoted to grossly selfish, materialistic enjoyments on the part of the successful entrepreneurs. But that is all. In conducting his business, an entrepreneur who has no interests other than to eliminate the ravages to humanity of dread diseases would act strictly on profit-maximising principles. By hypothesis his highest (in fact his only true) goal is to combat disease. All else (including enhancing the well-being of his workers, or of his business customers, not to speak of his own material well-being) must and will be subordinated to the overall objective of winning the greatest volume of profit in order to fight disease.

DBx: Critics of capitalism – those on the right, such as Oren Cass, and those on the left, such as Elizabeth Warren – consistently fail to understand the meaning of the profit motive, the function of profits, and the distinction between ends (often called “consumption”) and means (often called “production”).