Opportunity Cost

If I had the opportunity to teach the citizens of Western Democracies just one (non-theological) concept, I would choose to teach about “opportunity cost.”  Opportunity cost is an economic term that says when you buy one thing, you lose the ability or opportunity to use that money to buy another. Of course, it has other applications as well. Take time for example. If you do activity “x” you give up the opportunity to do “y.” 

What I love about this idea is the simple way that it reinforces the truth that choices have consequences. Citizens of the West never seem to be able to understand it though. Their incessant optimism and ability to self-actualize has made us drunk with the idea that if I have enough will-power and determination, “I can do it all” or that “anything is possible.”  Unfortunately, that sort of childish optimism is pure nonsense. But we continue to see it all the time.

 

Consider politicians. They are the favorite whipping boys of enlightened people. How often do you hear it said, “I just wish politicians would stop lying.”  At the risk of quoting a famous Hollywood movie, let me say the reason why politicians lie is because if they don’t, you won’t vote for them. Don’t believe me? Consider a politician who says we need to either raise taxes and/or cut spending (meaning the social welfare programs that people have grown accustomed to). How often does this truthful politician get elected? How often do you see that candidate slammed with the predictable firestorm of criticism? Yes, western citizens want it all. No taxes and lots of government handouts and no national debt. Contradictory? Sure. Impossible? Absolutely. But we don’t care.

 

But “opportunity cost” has much to teach us about the way governments use money too. Take Pakistan for instance. This impoverished country which couldn’t even muster the necessary resources to help its people during a massive earth quake two years ago, was somehow able to find the money to fund its nuclear program. Odd isn’t it? People living in huts and squalor but that all doesn’t matter, they have nukes. You may think it is a cheap shot to pick on Pakistan, a nation which feels threatened by its larger neighbor India. Perhaps, but the point remains the same. Pakistan, like other countries, made decisions that impacted other decisions.  All of us have most term papers done by have a glimpse at this site.

 

The question I would like to leave with you today is, when do private decisions absolve others from responsibility for the consequences of those decisions?  If you are poor, yet still find the money for non-essentials like cigarettes, booze, lottery tickets, etc., how guilty should the rich feel for not giving you money? Do foolish decisions on our part require moral obligations on others to help us?

 

© 2007 Stephen Vantassel

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