Capitalism’s Morality

In an article titled “The difference between private and public morality” Robert Reich states the “economy is built on a foundation of shared morality.”  So where is shared morality addressed among the precepts of our economic system? Though Reich notes, Adam Smith considered himself a moral philosopher—writing Theory of Moral Sentiments—I must add he also fashioned himself as a political economic philosopher by writing The Wealth of Nations.  The latter not the former book is the basis of our economic system.  And more to the point, the themes in these two works are far from being mutually supportive—they are as if penned by two separate individuals with different concerns—the former concerns ‘we’ and the later concerns ‘me’.


It’s About Me

As Adam Smith stated in The Wealth of Nations, every man . . . is much more deeply interested in whatever immediately concerns himself than in what concerns any other.”  Upon acknowledging this fact, if Smith proceeded to fashion constraints to this in his system of political economy then there likely would be a foundation of shared or public morality.  However Smith proceeded to construct his system making use of this self-interest premise.  Accordingly, his system of economics sets for each of us the aim of material self interest maximization.  Recall the familiar assertion by Smith “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.  We address ourselves not to their humanity but to their self-love and never talk to them of our own necessities but of their advantages.”  When it is all about ‘me’ getting ‘mine’ there is no shared morality.  It is an egoistic system resting solely on self-interest.


Clearly the notion of self-preservation translates into selfishness, wherein there is no concern for any or all other selves. Each individual in society is to enhance his/her condition materially, thus maximizing his/her own pleasure.  The only thing we share is a concern for our individual freedom to act as unencumbered independent beings.


Though there is shared concern for individual freedom, this concern is quite individualistic—what is shared is a concern for ‘me’.  Since each ‘me’ is different we are not really concerned about the same thing.  So you are on your own, and you best watch out for #1.


It was good ole Adam himself who advocated for individual business to produce and amass wealth at will without hindrance from government or concern for inevitable limits of natural resources—remember he was seeking an alternative to colonialism and the mercantile system practiced in the 18th century.


The idea that the conduct of business in society is no concern of government is an reductionist idea that emerged from 17th century Newtonian mechanics way before quantum mechanics in the 20th century revealed our deep interconnectedness.  In spite of this, we still hold on to the false belief that we each are independent—individualism not interconnectedness remains operative—and so we feel we must act solely out of selfish concern.  So we can see the origins of the lack of concern for the environment and for society by the business-minded among us.  Perhaps it is time people updated their beliefs and understanding of the nature of reality!


It’s About We

Since morality (and its partner ethics) have to do with an expanded concern for the other and all others, an economic system not having concern for anyone other than ‘me’ has no inherent moral requirements.  Moreover such a system has little relevance in a deeply interconnected world.  Tacitly perhaps we believe the invisible hand—which is a kind of imaginary friend—will somehow ensure our self-serving actions will add up to a positive for society as a whole.  Who ‘me’ worry about what the impact of my actions on others might be!  That’s what the invisible hands are for!  I guess the imaginary helping hands were all tied up during the years leading up to 2008!


Being independent means one doesn’t affect the other; that is everyone benefits from his/her own actions and no one suffers from the actions of others.  If we were in deed independent beings—as our economic system has us believe—the effects of our actions would be purely and simply summative—just actions, no interactions.  In this case acting without the possibility of impacting others would result in greater wealth in sum total.


Unfortunately this is not what happens: It’s a nice neat theory but nasty and messy when put into practice because it is a flawed theory—one that clearly requires the influence of imaginary helping hands.


Morality Is About Broadening Our Concern

Robert Reich concludes his argument for the need for public morality “It’s time once again to save capitalism from its own excesses — and to base a new era of reform on public morality and common sense.”  On the first point, given that capitalism is absent of morality by design is it really capitalism that must be saved?  This is like advocating for maintaining the incidence of criminal activity because it keeps the police and the courts busy and industrious.


However we do need a new era of reform on morality.  To this end we should cease complaining about the lack of morality and ethics while at the same time holding in reverence and thus defending one of the chief causes, capitalism. Since we are inextricably interdependent and deeply connected—not independent—we mustn’t continue following a system that is flawed in its basic premise.


It is time to save our selves from committing suicide by our adherence to an egoistic economic system.  It is time to envision an entirely different way of conducting business.


As for the second point, common sense, it is just as imaginary as the invisible hands. If it was common then we wouldn’t complain so much about its general absence: Really no one seems to have it except the one complaining about the other’s lack of it.  Perhaps common sense is not so common after all!

2 thoughts on “Capitalism’s Morality

  1. Pingback: It’s Rather Revolting « For Progress, Not Growth

  2. Pingback: Black Holes « For Progress, Not Growth

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