A good friend of mine encouraged me to read this note published by James Jay Carafano, Vice President of The Heritage Foundation.
Despite being as compelling as it is well intentioned, the article misses to mention one of the main arguments for free markets: what once Friedrich Hayek described as “the competition as a discovery process.”
Indeed, the concept is insinuated in Carafano’s piece of writing: “He decided to make a splash in the sports car market by jumping into the race car racket. Initially, he planned to do it by buying the world’s premier race car manufacturer, Ferrari. But that plan fell flat. So Ford moved to Plan B: to field his own, all-American team.”
Businessmen, like any other kind of people, are rational: initially, they try to maximize their profits by avoiding competition. They are not heroes and nobody can ask them to be so. People, businessmen included, respond to incentives.
When there is not any other choice than competition, then innovation, ingenuity, and creativity arise. Not because of a change in the mind of certain businessmen, but for new innovative entrepreneurs outperform the non competitive ones.
The free market capitalist system James Jay Carafano praises is mostly an institutional arrangement named -once again- by Hayek as “competitive order.” Nevertheless, the most interesting question for our times is not about the virtues of the said free market capitalist system -which seem to be out of discussion- but whether competition under the rule of law deserves to have a Kantian “Cosmopolitan Purpose.”