Were the Pyramids a Smart Investment?

Yes, the Egyptians could have used the resources to build steam engines or a moon rocket or any number of things. They didn't, however, and the results still helped stabilize the Egyptian culture for millenia. It worked, and the fact that the Egyptians were probably quite happy to help their god-king in the afterlife by building funerary complexes like pyramids is only a bonus. That simple act of being a net positive, historically, is what matters. - Avenio

Here's my response...

The simple act of not having to eat your children, historically, is what matters...

This eyewitness account comes from Abdel-Latif Al-Baghdadi, a physician/scholar from Baghdad who was in Egypt from 1194 to AD 1200. He reported that people emigrated in crowds and that those who remained habitually ate human flesh; parents even ate their own children. Graves were ransacked for food, assassinations and robbery reigned unchecked and noblewomen implored to be bought as slaves. Al-Baghdadi's account is almost an exact copy of that recorded by Ankhtifi, more than 3000 years earlier. - Fekri Hassan, The Fall of the Egyptian Old Kingdom

Yes, the Egyptians could have used the resources to build steam engines or a moon rocket or any number of things. - Avenio

Any given Egyptian could have used his resources to produce any number of things. He could have produced something and taken it to the market. Would other people have bought whatever it was that he produced? Perhaps? If yes...then he could have hired other Egyptians to help him produce his useful product. If no...then he could have worked for other Egyptians to help them produce their useful products.

A famine in Egypt obviously meant that there was a shortage of food in Egypt. But does that mean that they had a shortage of goods that they could have traded with other countries for food? In the case of ancient Egypt...yeah. They spent their nation's limited resources building the pyramids which had absolutely no trade value. They couldn't eat the pyramids and they couldn't trade the pyramids for food.

Here's an insight into the mentality of a conceited ruler...

Apart from their other characteristics, the outstanding thing about China's 600 million people is that they are "poor and blank". This may seem a bad thing, but in reality it is a good thing. Poverty gives rise to the desire for changes the desire for action and the desire for revolution. On a blank sheet of paper free from any mark, the freshest and most beautiful characters can be written; the freshest and most beautiful pictures can be painted. - Mao Zedong

During the Great Leap Forward...Mao used China's limited resources to try and help China catch up with the rest of the world. Rather than acknowledge and protect the unique information that was already written in each person's mind...he overwrote their information with his own information. The result was an artificial famine which led to the deaths of 20-40 million people.

Carefully and thoroughly read over this passage by Adam Smith...

The man of system, on the contrary, is apt to be very wise in his own conceit; and is often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it. He goes on to establish it completely and in all its parts, without any regard either to the great interests, or to the strong prejudices which may oppose it. He seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board. He does not consider that the pieces upon the chess-board have no other principle of motion besides that which the hand impresses upon them; but that, in the great chess-board of human society, every single piece has a principle of motion of its own, altogether different from that which the legislature might chuse to impress upon it. If those two principles coincide and act in the same direction, the game of human society will go on easily and harmoniously, and is very likely to be happy and successful. If they are opposite or different, the game will go on miserably, and the society must be at all times in the highest degree of disorder. - Adam Smith, Theory of Moral Sentiments (1759)

Do you see how this ties into Mao's belief that each of the 600 million Chinese person was a blank page? Mao completely failed to understand the fundamentally important concept that each person has their own principle of motion. Good thing for China though that somebody did understand this fundamentally important concept...the pragmatic consequentialist Deng Xiaoping. The result? Millions and millions of Chinese people were lifted out of poverty.

We've completely fetishized the idea of freedom but few people truly understand its inherent value. Freedom means that nobody prevents you from using your limited resources. If you choose to use your limited resources to produce something that I value...then I will choose to give you some of my own limited resources. The market process is constantly redistributing resources to the people who use society's limited resources for society's maximum benefit.

So what would have happened If Egyptian taxpayers could have chosen which government organizations they gave their taxes to? They would have given their taxes to whichever government organization was producing the maximum benefit for society. Would the Egyptian taxpayers have agreed? When does everybody always agree on everything?

But do we really want all the taxpayers to agree on how our society's limited resources should be used? Do we really want to put all our eggs in one basket? Or do we want to hedge our bets?

We're all unique individuals with our own perspectives. Freedom allows us to use different approaches to tackle different problems. One of Deng Xiaoping's famous sayings was "cross the river by groping for stepping stones." If we want to cross rivers...if we want to successfully overcome obstacles...then we shouldn't limit the expression of our individuality.

 ... an increase in the power of the State ... does the greatest harm to mankind by destroying individuality which lies at the heart of all progress... – Gandhi

Our individuality is the source of innovation, ingenuity and resourcefulness. Markets work because we all have the freedom to give our own limited resources to the people who are using society's limited resources for our benefit.

The capitalist society is a democracy in which every penny represents a ballot paper. - Mises 

We all want more for less which is why the market process leads to an abundance of what we, as a society, value.