Profit Is the Purpose of Term Paper

Excerpt from Term Paper :

He believed that people cannot be trusted to act in their own best interest, and are better governed by a state that usurps the profit motive thought process from the people. He understood the evils of the profit motivator in business, and sought to artificially remove it from the equation. However, he too understood that it is natural to seek profit as the motivation for business, as he acknowledged that the government must actually take steps to cleanse business of the profit motive.

At first glance, the profit motive seems inseparable from business. However, examining Mill and especially Marx, we understand that it is indeed possible to antiseptically remove profit as a motivator and purpose of business, but the question remains, what to replace it with?

Communism was not the answer. It removed profit as a motive, but was not able to substitute any other purpose to business, so business in ex-Communist states such as the Soviet Union failed miserably.

China and North Korea find themselves making concession after concession to keep their socialist business leanings, but even China, for instance, oversaw the recent merger between the IBM PC branch and one of its computer companies. Profit here was definitely the motivation. Perhaps removing the profit motive from business may work in the short-term on a domestic level, but with our highly layered international economy, it is downright impossible to remove profit as a purpose altogether.

The trick, therefore, is to use profit and allow profit to motivate individuals and companies to perform, but put limits on it, via social nets and ethical limitations. Social nets involve welfare programs, and the recent Sarbanes-Oxley flurry shows that even in a capitalistic society, there is and must be room for ethics to invade, destroy the profit margin some, but increase economic growth in the short-term.

That, indeed, is the crux. In the long-term, capitalism will right itself and steady its own ship, as market forces will prevail. In the short-term, however, so many billions will suffer if capitalism is allowed to run rampant. That is why we allow profit as the purpose for business, but check it constantly.

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