Moralizing markets

There is a struggle some have about the wealth created by modern capitalist markets. Kevin Brown hits this in his column Capitalism and the Common Good — How to gear the free market so that people floursh.

As people of faith, we need not deify or demonize the market. Instead, I propose we focus on ensuring that the market’s consequences create the least possible damage and the greatest common good for our neighbors near and far. The market may be one gift from God, but he’s given us a greater gift in the church. Together, we can watch out for the most vulnerable members of society lest they slip through the cracks of our global marketplace.

The biggest problem is that he confuses causation with correlation and neglects the inherent moral issue centered on the temptation of man. From “The Coltan Conundrum” to child labor laws, he confuses the sources of evil. He shows an awareness of this:

Stanford ethicist Debra Satz says that in Adam Smith’s classical economic vision, markets flourish when they are grounded in property rights, with appropriate government regulation and social conventions. In other words, well-functioning markets do not so much produce these attributes; they need to be grounded in them. Thus Christians can be actively involved in shaping the regulatory environment and the moral and ethical social conventions that allow for healthier markets.

The ideology is the false assumption that corrupts thoughts and lends bias. It is one that delves into motivations rather than actual behavior.

The market is regularly tempted to think of humans less as persons and more as “factors of production.”

The economist occasionally surfaces in this mudstorm:

UK political philosopher Jonathan Wolff says that for an economic system to survive, it need not be optimal, just superior, to other systems. It doesn’t have to be perfect. It just has to be the best available option in an imperfect world. As an economist and a Christian, this strikes me as a helpful vantage point in moving the market debate forward.

At the practical level, most critics of the market system advocate some form of a planned economy, … this only introduces new problems. In planned economies, we do not see the same level of innovation or effectiveness … Planned economies also hinder the supply and demand forces that ultimately provide consumers with the best prices. … We must also note that a paternalistic environment usually discourages human creativity, initiative, and industry. And these are all ways in which we bear the image of God. There is a spiritual cost to a planned economy.

While Brown wails on at length about “collateral damage” he seems to forget how the market brings this into personal consumer decisions (along with context and other issues). In marketing, this aspect of the transactions is known as the brand. People will pay a lot to get what they want from a vendor who has an image they endorse. You can see this in the assault on WalMart (and others) regarding merchandise made in China, for instance. The key here is that a market system is not simple. It is composed of many transactions and each one has many factors that involve personal choices. As the first quote above signifies, the issue with markets, the angst and moralizing, isn’t really about the market system but rather about individuals and the choices they each make every day and for every purchase.

That is the fundamental problem. Instead of looking at ourselves, we are looking for a scapegoat. Ragging on that scapegoat isn’t going to solve anything as long as each of us as individual humans do not take possession of our faults and failures

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