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Does the free market erode moral character?
I am honored to share a symposium with Garry Kasparov, among other notables, including Robert Reich, Jagdish Bhagwati, Bernard Henri-Levy, Michael Novak, and others. My answer to the question is "No, on balance" and here is my opening bit:
In matters of morality, the free market functions like an amplifier. By placing more wealth and resources at our disposal, it tends to boost and accentuate whatever character tendencies we already possess. The net result is usually favorable. Most people want a good life for themselves and for their families and friends, and such desires form a part of positive moral character. Markets make it possible for vast numbers of people, at every level of society, to strive for and achieve these common human ends.
There is much more at the links.
Posted by Tyler Cowen on October 6, 2008 at 10:32 AM in Philosophy | Permalink
Comments
Deirdre McCloskey's book "Bourgeois Virtues" should not go unmentioned in this conversation; why has it been?
Posted by: indiana jim at Oct 6, 2008 11:13:54 AM
What economic system, precisely, improves moral character?
Posted by: Robbie314 at Oct 6, 2008 11:21:33 AM
here is my opening bid
the more open the market , the more the common people will be used by the kapalistic pigs of modern society.
kasparov levy novak Hmmm , oink oink.
Posted by: Hemaworstje at Oct 6, 2008 11:23:33 AM
Excellent insight on your part. This is an interesting and not-unimportant subject. Indeed, it is a very timely subject that will soon likely be considered at least somewhat widely. In the case of an Obama victory, this subject will definitely be considered widely as he undoubtedly would launch a head-on assault on free markets - at the very least rhetorically, but seemingly very likely also in practice.
Posted by: Sean at Oct 6, 2008 11:29:42 AM
Working for the government erodes moral character. The free market erodes moral character. Maybe life erodes moral character?
Posted by: libfree at Oct 6, 2008 11:31:20 AM
Can you explain to me how Rick Santorum gets invited to a debate about Free Markets and moral character? At what point during his many years of spewing his hateful rhetoric did someone think that he might have a qualified opinion on Free Markets?
Posted by: Noah at Oct 6, 2008 11:31:43 AM
There is a huge amount of evidence that protection of property rights, and the natural free exchange that comes about in their presence, has been a huge boon to the moral character. Voluntary exchange replaces theft. Cooperation replaces violence. Peace can even replace war as international trade replaces plunder and invasion.
McCloskey is great on this, but many others discuss this too, from Adam Smith to Brink Lindsey.
Posted by: liberty at Oct 6, 2008 11:32:17 AM
They got all these well-known intellectual and they ask such an ambiguous question! I am not sure what question would I ask ...
Tyler, if you could have chosen the question, what would you have asked to the same group of people?
Posted by: londenio at Oct 6, 2008 11:46:00 AM
The Spanish Scholastics had answered this question long ago with their ethical answer to which is better for society, public or private property. Those who get ahead with public property are those that lie, cheat, and steal while as those that gain the most from private property are those that work as hard as they can or who create new ways to improve how much they produce. One is morally just, whilst the others is immoral.
Also, Tullock had pointed out that there is no system that can exclude the immoral man as anyone who is intelligent enough to realize what he must do to advance will do whatever it takes. Therefore if it be best for the immoral individual to perform an act that benefits himself but not the company, he will perform it; while as the moral individual would not. Even in a moral situation where the industry promotes the most moral, the immoral would mend his ways to appear to be the most moral in order to achieve his goal.
Posted by: Ian Dunois at Oct 6, 2008 11:52:14 AM
"What economic system, precisely, improves moral character?"
Spartan communism, obvisouly.
Posted by: djg at Oct 6, 2008 12:32:16 PM
Not the free market itself.
But if you can influence the flow of large sums of money that aren't yours, *that* erodes moral character. There's likely to be a way you can influence that flow which will benefit yourself or your friends.
In that context I want to again link to this:
http://yglesias.thinkprogress.org/archives/2008/10/after_legislating.php#comment-688446
------
rmwarnick Says:
President Bush, in a matter of two weeks, went from (1) “There’s not a problem, the fundamentals of the economy are strong,” to (2) “Great Depression Two is only days away unless Congress gives me unprecedented amounts of money and unprecedented power NOW,” to (3) “Nothing’s going to happen for at least a month because we need to analyze and deliberate.”
He’s still got it. Never mind the fact Bush is the worst and least popular President ever. He can get away with anything, anything at all.
-----
Being President of the USA is a moral hazard.
Posted by: J Thomas at Oct 6, 2008 12:38:27 PM
Although Cowen and Bogle are sound and insightful, I think Gray was the most far-sighted. Markets should turn competitive pressure on individuals into competitive pressure on groups (and thus harness evolutionary dynamics to the benefit of all society). But the increasing divisions of labor between managers and owners has at present eroded this salutary quality of markets. Internet technology nonetheless stands at the door and knocks. Will we figure out how to keep each other accountable at a global scale? Some of us simply don't look back.
Posted by: Michael F. Martin at Oct 6, 2008 12:54:41 PM
This is a ridiculous question.
Free markets are effective at creating wealth. Wealth is has no moral attributes, it is a tool. This is
just about where most leftist idiots get lost, since they see know flaws or weaknesses in individual
humans. As a result of that failure, they either see some amorphous collective indifference (inadequate
"leadership", or some morally neutral inanimate object (guns, derivatives) as the source of moral
failing.
Why aren't we asking if the collectivist models erode moral character, given the fact that literally
hundreds of millions have died under its jackboots and in its gulags? We don't even have to go into
the left's ready willingness to vacate property rights and engage in theft to further its egalitarian
aims.
Posted by: Superheater at Oct 6, 2008 1:05:22 PM
"Most people want a good life for themselves and for their families and friends,"
I see you are alive and well, O Polemarchus.
Posted by: xanthippe at Oct 6, 2008 1:10:56 PM
Yea sure, because we all know that there was no corruption in communism, socialism, or mercantilism.
Posted by: torris at Oct 6, 2008 1:29:29 PM
Of course free markets tend to corrupt. The temptation is always there to retreat behind cavet emptor when someone offers a good price for your pig in a poke. However, as a general proposition, the more unfree the market becomes, the greater is the tendency to corrupt.
A thousand years or so before the Spanish Scholastics came to their view, similar points about ethical effects were made in the Chinese debate about the relative virtues of government and private ownwership of means of production.
Overall, free markets are ethically awful; until you look at the alternatives. A bit like democracy as a system of government.
Posted by: Diversity at Oct 6, 2008 1:40:29 PM
Or do bad moral characters erode capitalism?
All I know is there are a lot of people I smile at at Wal-Mart that I wouldn't trust with my neighbor's dog.
Posted by: Andrew at Oct 6, 2008 2:47:04 PM
My answer would be how could anyone know? Asking if the free market erodes moral character would be like asking if living on Mars erodes moral character. The attempt to verify a hypothetical seems a bit strange to me.
I guess the better question would be does the relatively free ability to make exchanges with others erode moral character?
Posted by: john pertz at Oct 6, 2008 3:26:36 PM
How about "Does belief in a utopian free market delude otherwise-sane people into ignoring the obvious?"
or
"Exactly how quickly are free-marketeers apt to shout out the knee-jerk, straw man response 'But it's better than anything else!!!!' when asked if free markets erode moral character?"
Posted by: meter at Oct 6, 2008 3:45:57 PM
The responses here are interesting. Many people seem to be saying "yes, but less than the alternatives". If thats the case, then where does this "moral character" originate from? Our families? Families can teach terribly immoral things to their children.
I'm with Mises on this one. Moral character, whether genetic or memetic in origin, must have some real advantage in order to exist. We cooperate because its mutually beneficial, and voluntary cooperation is also known as a free market.
Coerced cooperation, or an "unfree market" wouldn't be evidence of any sort of moral character at all, IMO.
Posted by: Grant at Oct 6, 2008 4:03:27 PM
While friendship bonds have been part of the philosophy of moral character at least as far back as the Confucians and Athenians, I think the more relevant moral issues is how you treat non-friends. How does the free market affect one's dealings with people unlikely to engage with one in direct exchanges?
Posted by: Trevor Stone at Oct 6, 2008 4:05:13 PM
A truly free market that rewards virtues and punishes the lack of them breeds moral character.
Even in a corrupted economy like that of the United States, there are still plenty of people in business that are highly moral. Being dishonest doesn't pay and associating with dishonest people doesn't pay.
Of course, with our leaders on the take and financing people who haven't acted responsibly, those who do productive honest work will pay the price when this whole mess craters the global economy and forces the US to default on its obligations.
Posted by: Alan Brown at Oct 6, 2008 7:07:03 PM
As the saying goes, absolute power corrupts absolutely. As power, i.e. legislative authority and wealth, is consolidated into the hands of the few those few are less restrained by others and thus are more empowered to impose their will, good or bad, indiscriminately.
"Constant experience shows us that every man invested with power is apt to abuse it, and to carry his authority as far as it will go... To prevent this abuse, it is necessary from the very nature of things that power should be a check to power." - Montesquieu
Posted by: Gadfly at Oct 6, 2008 7:29:16 PM
I'm not sure power corrupts.
Power over the possessions of others clearly does and the US government is proof of that.
But power over one's own life and one's honest work has never corrupted anybody.
When consequences follow actions, actions tend to be better. When those taking risks and incurring costs suffer the possible losses, they make more moral decisions.
Posted by: Alan Brown at Oct 6, 2008 7:53:52 PM
You can't tell the complete truth in any endeavor and be successful. Try telling your boss that he's an idiot or your wife that she looks like crap in the morning.
Posted by: amiller1994@hotmail.com at Oct 6, 2008 8:05:41 PM
