Those Evil Capitalists

That evil capitalist company Apple has really gone and done it this time:

Apple Inc and its key supplier Foxconn Technology Group will share the initial costs of improving labor conditions at the Chinese factories that assemble iPhones and iPads, Foxconn’s top executive said on Thursday.

Foxconn chief Terry Gou did not give a figure for the costs, but the group has been spending heavily to fight a perception its vast plants in China are sweatshops with poor conditions for its million-strong labor force. It regards the criticism as unfair.

“We’ve discovered that this (improving factory conditions) is not a cost. It is a competitive strength,” Gou told reporters on Thursday after the ground-breaking ceremony for a new China headquarters in Shanghai.

“I believe Apple sees this as a competitive strength along with us, and so we will split the initial costs.”

Apple is going to foot a portion of the costs required to improve the working conditions at Foxconn. While I point to this as a demonstration of capitalism others are quick to point out that Apple is only doing this out of self-interest. These people claim the only reason Apple is working to improve the conditions at Foxconn is to improve their image in the eyes of the world. And you know what? Those people are right.

One of the primary differences between capitalism and socialism is that capitalism relies on individuals’ self-interest while socialism relies on individuals’ altruism. In general humans are like any other animal, we’re interested in what’s best for us. What advocates of socialism miss is the fact that self-interest, in a society, usually means mutual benefit. Apple is the perfect case. Their customers have been noting their unhappiness with the conditions at Foxconn so Apple has moved to improve its image by improving the working conditions at Foxconn. Unhappy customers often aren’t repeat customers and when you’re a business you want as many repeat customers as you can get.

Ludwig von Mises defined the action axiom as, “purposeful behavior. Or we may say: Action is will put into operation and transformed into an agency, is aiming at ends and goals, is the ego’s meaningful response to stimuli and to the conditions of its environment, is a person’s conscious adjustment to the state of the universe that determines his life. Such paraphrases may clarify the definition given and prevent possible misinterpretations. But the definition itself is adequate and does not need complement of commentary.” Humans act to alleviate discomfort. When you’re hungry you eat, when you’re thirsty you drink, when you need to tell the time you buy a wristwatch, when your neighbor’s plight causes you unease you help them, etc. In the case of a business man action often comes from making his customers happier. His customers’ needs is the motivating factor in providing goods and services because it is through the providing of those goods and services that the business man is able to enrich himself.

Don’t think of an act performed out of self-interested as bad because all acts are ultimately performed out of self-interest. Self-interest can be a bad thing when one chooses force to attain their goals but when one chooses the easier way, the way of trade, self-interest becomes a beautiful thing that improves the lives of all involved.