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Can Wealth Make Us Happy? Sort of

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Tags Media and CultureCapital and Interest TheoryPhilosophy and Methodology

Let's say that we could generate a graph with happiness in rows and wealth in columns. The curve slops perfectly upward. The more wealth you have, the happier you are; the less wealth, the less happy. The same goes for countries: poor countries are packed with people who are down in the dumps, whereas rich countries are overflowing with joyful souls.

It sounds ridiculous, doesn't it? If someone made an argument for free markets along these lines, it would be a perfect strawman to topple. And yet, this is precisely the straw man that many anti-capitalists thrill to thrash again and again. Of course we can't plot happiness this way. Human beings are not mechanistic creatures, and most everyone knows that the idea of happiness is bound up with much more than material possession (even if we also understand that we would all rather be rich than poor).

Somehow, however, our friend Rod Dreher is again at pains to point out that happiness does not equal wealth and he again flirts with the idea that perhaps government ought to get involved in curbing market excesses in order to drum up more happiness for everyone.

"Some happiness economists say that backing laws that give workers more time with their families would be helpful. Others say that raising taxes on the rich to discourage spending that drives the hedonic treadmill is called for. Because the disruptions of dynamic capitalism can fray the bonds of families and communities, restrictions on commerce could be justified for the sake of general well-being." But then he hastens to add, sensibly, that "involving the government in schemes to engineer happiness through legislation deserves skepticism, to say the least."

His article quotes Mises in praise of the industrial revolution, and that's good a thing because it suggests that he is broadening his reading beyond communitarian academics and the gaggle of green fools that he quotes in his book. And yet he still seems to miss the central point. The case for capitalism is not about whether the means to bliss is material possession. It is about whether people are made more or less better off (in every sense) but being left free to act and exchange as verses the only alternative: using the police state to prohibit peaceful action and mutually beneficial exchange.

And by the way, there is far too much trashing of prosperity going on these days. A century ago, at least the capitalists and socialists agreed that prosperity is better than poverty. Now we have a generation of activists hellbent on bringing down prosperity goof our own good. Remarkable.

At the end of Rod's article, there is a country list from a study that claims to plot happiness. It turns out that study actually received a great deal of attention last year. It turns out that the researchers—and I know nothing of their methods—do in fact generate a map that roughly correlates wealth and happiness, if we remember that issues of health, e.g., are mainly a reflection of wealth. I don't Rod would be entirely pleased if he looked more closely at this study.

Jeffrey Tucker is Editorial Director of the American Institute for Economic Research. He is author of It's a Jetsons World: Private Miracles and Public Crimes and Bourbon for Breakfast: Living Outside the Statist Quo. Send him mail.

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