JIS XVI 2004
CAN THE MARKET BE MORAL?
JIS XVI 2004: 1-19
VIRTUE AND MARKETS
Institute for Interdisciplinary Research
This essay proposes an interdisciplinary framework for teaching markets and morals by exploring the linkages between political economy, civil society, and culture. Free markets in capitalist mixed economies shape, and are shaped by, political institutions of representative democracy, the vibrancy of civil society, and the values, norms, and beliefs embedded in culture. The major challenge for liberal society and free markets is to reconcile individual and group interests with the common good. The cultural contradictions of capitalism reflect the inadequacy of commercial virtues to sustain a liberal society. External constraints of law and institutional checks and balances in all spheres need to be conjoined with internalized moral constraints of a well-ordered individual conscience. This, in turn, requires a normative order which transcends radically the selfishness of individual and group interests, thus preserving liberty and democracy while enhancing economic efficiency and the social beneficence of free markets. The essay thus confirms Alexis de Tocqueville’s notion of the interdependence of liberty, morality, and faith.
JIS XVI 2004: 21-40
MORAL REFLECTION AND MARKETS
The idea that the pursuit of self-interest in economic life would lead to social harmony had a positive effect on production, but it led many to assume that virtue and moral reflection were no longer essential in socializing human passions. As specialization and trade extended markets, workers followed the jobs, leaving their social and moral moorings behind. The fragmenting of social capital made it difficult to foster social trust and cooperation. Neoclassical market theory does not interface well with other disciplines given its scientific approach of rational choice analysis. Non-egoistic motivations like values and beliefs are usually excluded from economic thinking, so moral reflection is relegated to economic applications only. These factors reduce the impact of moral reflection in economic life. Yet self-regard, market flexibility, and a scientific approach to markets all have positive qualities for integrating economic and moral life.
JIS XVI 2004: 41-64
ADAM SMITH’S FAUSTIAN BARGAIN:
FREEDOM FOR MORALITY
Douglas K. Adie
Adam Smith created a social model which subordinated faith to reason and reason to the instincts which, when released, drive the “system of natural liberty,” facilitating peace, prosperity, and especially freedom. Smith’s Faustian Bargain, which underlies the model, is to trade beneficence for self-preservation plus freedom. Without restraint, the social instincts would endanger private property and social stability. Smith recommends limited but effective government and a plethora of social devices, including a reconstituted, impotent collection of churches, to bolster morality and prevent instability. Transplanted to America, Smith’s system and Biblical Christianity restrained immorality and allowed free enterprise to flourish yielding unprecedented freedom and prosperity. The decline of faith in the Biblical God and moral absolutes at the end of the nineteenth century upset the delicate balance between freedom and morality resulting in social problems not susceptible to voluntary solutions. Government intervention slowed economic growth and restricted individual freedom. Will a twenty-first century Biblical revival restore morality and permit once again the flourishing of individual liberty, or will government intervention continue to erode freedom?
JIS XVI 2004: 65-79
FREE MARKET CAPITALIST
Harold B. Jones, Jr.
This essay argues that Kant’s philosophy provides a justification for free markets. The myths about Kant are that he was a recluse, knew nothing about business, and that his epistemology divorced reason from reality, while his primary interest was metaphysics. Yet Kant’s categorical imperative demands obedience even in the face of uncertainty about the external world. Adam Smith described this principle as the inward testimony of an impartial observer. Smith and Kant put individual decisions at the center of morality, but agreed that people have a tendency to make morally inferior choices. Those who propose to regulate the economy are as troubled by this tendency as those they regulate. The self-sacrifice prescription is economically, psychologically, and morally unstable. In recommending market competition, Smith was unconsciously applying a Kantian formula. Market decisions are individual decisions. Individuals prefer to do business with those they trust: this is an incentive to honesty. A morality that depends upon incentives is imperfect but superior to a morality imposed by force.
JIS XVI 2004: 80-96
CAN INDIVIDUAL MORALITY AND
COMMERCIAL LIFE BE RECONCILED?
Adrian Walsh & Tony Lynch
University of New England, Australia
Socialists and defenders of laissez-faire share the view that in the market agents pursue their self-interest, not the good of others. On this basis, socialists reject the market as an arena of immorality, while laissez-faire theorists attempt to defuse the charge by relying on the providential consequences of the “invisible hand.” However, both stances presuppose a view of morality that too sharply separates self-interest and altruism. Some try to separate the economic and morality into discrete spheres. In contrast, a compatibilist account shows the ways a concern for personal profit and a concern for others can come together. Such a motivationalist approach allows one to re-conceive the “invisible hand.” It is no longer a serendipitous justification of the merely self-interested, but an invitation to think of the various mixtures of altruism and self-interest required to produce those results that may commend the market.
JIS XVI 2004: 97-110
PERSPECTIVES ON WORK
IN AMERICAN CULTURE
This essay compares five different conceptions of the nature of work: capitalist, Christian, Buddhist, republican, and environmentalist. The capitalist perspective on the nature of work profoundly affects our common conceptions about the nature of work as well as our experiences with work. Nevertheless, there are also non-economic conceptions of the nature of work that are effective, influential, and contribute to a moral marketplace. The four non-economic traditions suggest ideals of what work ought to be, and ways through which one may transform the experience of work while living in a democratic capitalist culture. Further, the fact that the four different non-economic traditions can agree in characterizing work as a calling gives credence to the notion that an interdisciplinary and interfaith conception about the ideals of work can be attained.
JIS XVI 2004: 111-132
POLISH PERSPECTIVES ON THE MORALITY
OF CAPITAL ACCUMULATION
Maria Nawojczyk & Shane Walton
Nicholas Copernicus University, Poland
This essay examines market morality from a sociological perspective. Focusing upon a case study of Poland, it highlights the effects historical socio-political forces have upon popular attitudes toward unequal accumulation. Poland’s unique mythology of wealth is rooted in both peasant and literary subcultures, and the communist experience. Public opinion surveys demonstrate that negative attitudes toward wealth accumulation were pervasive in Poland during the early 1990s. Actual capital accumulation suggests that, in the early years of the post-communist transition, Polish reality largely substantiated Polish mythology. Political connections were often used to enter the Polish business elite, and shady practices employed to maintain such positions. The essay explores this correlation, highlighting social mythology’s joint dependence on cultural residue and reality, as well as the effects of social, political, and economic forces upon societal attitudes toward morality in the marketplace.
JIS XVI 2004: 133-156
FRIEDRICH HAYEK AND REINHOLD NIEBUHR
ON THE MORAL PERSISTENCE OF
Attempts by Christian social theorists to harmonize Austrian liberalism and Christian tradition ignore serious contradictions in their respective moral systems. Friedrich Hayek’s conception of the “spontaneous order” portends potentially harmful consequences for corporate religion by elevating the subjective individual as the singular source of value in human culture. Thus, Hayek’s ideas on cultural evolution may provide insight into the perceived loss of moral voice among American religious institutions. Reinhold Niebuhr’s economic realism is more conducive to exploring the moral persistence of liberal society recognizing the need for balance between subjective and collective expressions of the good. Key concepts in Niebuhr’s economic thought are a unique value theory, a holistic conception of the individual and society, an understanding of the moral ambiguities associated with technological innovation, and recognition that balances of power are necessary to preserve social organicism and the Christian conception of personality.
JIS XVI 2004: 157-172
PROPERTY, COMMERCE, AND
LIVING GOD’S WILL
Garrick R. Small
University of Technology, Australia
Market capitalism requires absolute private property, and both institutions appeared at about the same time in history. The morality of the market rests on the morality of property, which may be argued both from Scripture and secular perspectives. Both approaches yield a theory of property that supports private ownership conditional on obligations to the community. Apparent contradictions in Scripture regarding property are resolved by this approach. Property ownership confers economic power on its holder. Modernity assumes that this power must be controlled by external forces–either by the market, or the state–but both limit freedom. True moral action must be free. The moral opportunity of the market is to avoid using economic power to exploit others, especially the weak and needy. Christian thought supplies the outline principles for moral guidance for ethical market action that revolve about self-restraint.
JIS XVI 2004: 173-184
ECONOMIC AND POLITICAL MARKETS:
MERITS, LIMITATIONS, AND THE ROLE
OF BIBLICAL MORALITY
Indiana University-New Albany
Discussions about economics and politics often generate more heat than light. What do the dictates of Scripture and insights from the field of political economy bring to the table? Of greatest importance, in a world of sinful people, economic markets have the ability to constrain immoral behavior by connecting moral behavior with financial and social reward. Yet, freedom still allows the possibility of unjust actions in economic markets. Thus, some potential role for government obtains. From there, the tension is between the utopian desire for government to constrain justly and the practical realities of government in a fallen world. At the end of the day, the Christian cannot be fully content with either economic or political markets. They are left with the clear Biblical call to act with righteousness and justice in their own spheres of influence and the possibility of defending the rights of others through politics in the limited occasions when government policy is an ethical, appropriate, and practical means to godly ends.