In last night’s season finale of HBO’s The Newsroom, economic wonder girl Sloan Sabbith tells her ego-centric boss Will McAvoy, “The greater fool is someone with the perfect blend of self-delusion and ego to think that he can succeed where others have failed. This whole country was made by greater fools.”
The greater fool theory is the belief that one can turn a profit by speculating on future prices rather than creating actual value. It relies on the assumption that someone else will be left holding the bag when the bubble bursts. Speculation is a great way to make a lot of money (and so is a Ponzi scheme), but it’s certainly not the way America was made.
What Newsroom creator Aaron Sorkin fails to understand is that America is a country that builds things, not a country that feeds off the foolishness of others. Sorkin — like President Obama — sees the economy (wrongly) as a game of winners and losers. As President Reagan would put it, he “can’t see a fat man standing beside a thin one without coming to the conclusion the fat man got that way by taking advantage of the thin one.” It’s a misunderstanding of the very nature of free-market capitalism that Sorkin shares with many on the left.
Free-market capitalism is the only economic system ever devised that gives all individuals the opportunity to be economic winners. Americans need not rely — and traditionally have not relied — on the foolishness or coercion of others to attain their own success. Instead, we build our own success by producing things of value.
But that’s fundamentally different than how things work in collectivist economic systems, where society inevitably turns to a greater fool — an economic loser — selected by government coercion to equalize outcomes for all. In these societies, the fat men really do get that way by taking advantage of others.
That’s not what America is about. We don’t manipulate the system to get ahead. We don’t find honor or respect in speculation; we find it in hard work and personal achievement. And that, Will McAvoy, is why America is the greatest country in the world.
Jordan Haverly is a political communications consultant and former staffer to Rep. John Shimkus (R-Ill.). He is a 2009 graduate of American University’s School of Public Affairs.