Gary North's Version of the Goose That Laid the Golden Eggs

Gary North

Jan. 20, 2011

For 1500 years, Western children have been told a version of this story.

A cottager and his wife had a goose that laid a golden egg every day. They supposed that the goose must contain a great lump of gold in its inside, and in order to get the gold they killed it. Having done so, they found to their surprise that the goose differed in no respect from their other hens. The foolish pair, thus hoping to become rich all at once, deprived themselves of the gain of which they were assured day by day.

The focus of the story is "let good enough alone." Or, "be content with a daily miracle." Or, "rent-seeking is good enough." Or, "don't tax capital; tax income."

As an entrepreneur, I don't like the story. One stream of income is not good enough for me.

A cottager and his wife had a goose that laid a golden egg every day. They supposed that the goose must be a genetic freak. Maybe its offspring could do the same. So, after a week of egg collecting, they let the goose sit on an egg to see if the egg would hatch. Sure enough, it did. The gosling grew, and later started laying a golden egg every day. So, they let that goose hatch an egg. The next goose laid only silver eggs. But that was still pretty good. They moved to the Bahamas, gave up their citizenship, built the gaggle, and sold the whole thing to Berkshire Hathaway 15 years later, which then franchised the operation.

The goal should not be to keep the eggs coming, day by day. It should also not be to get all the gold at once. The goal should be the multiplication of egg-producing geese. When an entrepreneur discovers a way to satisfy customers, his goal is to get more customers. If he can do this, he can sell the operation to buyers of established income streams. He can take the money and either retire or find a duck that lays golden eggs.