Money Without Boundaries

Chapter 6The Role Model

“Almost certainly, however, the first essential component of social justice is adequate food for all mankind.”

– Norman Borlaug

I was going to school at Washington University in St. Louis in the 1990s, just after the collapse of the Soviet Union, and I had a friend who was from Russia. One night over beers, we got to talking about what it was like there during this historic event, and it was fascinating. Sure, people were excited about all the new possibilities and freedoms that would come with the USSR's fall, but they also had all sorts of doubts about how capitalism could possibly work. The whole concept was in fact literally terrifying to many Russians.

My friend could not understand, at the time, how money-seeking companies could be trusted to run grocery stores, which supplied the population's most basic of all needs. “What happens if they just say, ‘We're not going to carry milk and eggs.' What if milk goes to $20 a gallon because all the stores have colluded, so they have fewer products for higher prices?” He got really worked up about this, and I was moved.

We then discussed what we had learned in economics classes, that controlling prices, as the Communists did in the USSR, is actually what amplifies them and causes products to be of lower quality.¹ It's probably not intuitive to a lot of people, not just those who have lived in Communist regimes, but capitalism provides more choices at less cost.

Like a good Iowan, I explained to him that ...