Is Capitalism Moral?

Is Capitalism Moral?

Here's a thoughtful challenge to capitalism that came up on Facebook last year on this day, which I don't think I've answered yet. It was posed by Eric DeJardin in response to my description of slavery as an inherently "corrupt-making" institution. Doesn't capitalism also corrupt the capitalist?

"Would you say that the imperative of viewing labor power as a commodity doesn't carry with it the danger of viewing people as commodities? If so, the latter is surely potentially soul-corrupting, especially if it tends to lead us to view them as mere commodities (in which case it very plausibly runs afoul of Kant's humanity formula of the CI)."

If Kant has something interesting to say about capitalism, I'll let the Eric DeJardin bring him in. Here are my thoughts:

1. Our relations with others can be divided, as Martin Buber did, into "I-It" and "I-Thou" perspectives. (But this will be my analysis, not his.)

2. "I-Thou" means (as I take it) that we enter into full personal relations with one whom we recognize and treat as a dignified and intrinsically valuable being.

3. "I-It" is more functional, treating the "other" essentially as a means to some goal.

4. For practical purposes, I-It relations are the norm. We may smile at the woman who takes our money at Burger King and wish her a good day, but we're mainly wondering why burgers have gotten so expensive, or whether we should order a side salad. She is mainly an instrument for a transaction, and you are mainly a customer through whom her paycheck will come, while she wonders whether she can afford a trip to Mexico this spring.

5. All big corporations, clans, or kingdoms see millions of such pragmatic transactions a day, in which one primarily views the "other" as a means to an end, or a roadblock (say, a slow driver in the left-hand lane) preventing you from reaching your goal.

6. Christians are called to recognize the "Thou-ness" of those with whom they interact, as we see from Jesus, both in his stories (Good Samaritan, etc), and in how he treated those he met. While the disciples often saw people as categories (harlot, Pharisee, old woman, etc), Jesus looked people in the eye.

7. Yet we cannot raise our hats, like Crocodile Dundee, to everyone in Manhattan. "Who touched me?" The disciples wondered why Jesus asked, because the crowd was pressing on all sides. Humans are also bodies which obey the laws of physics, such that one may need to get into a boat to separate oneself from their "it-ness" even to speak more clearly to their "thou-ness." If you pray for everyone who does 50 in a 60 or tailgates you when you're doing ten over the speed limit, you may be on the slow road to sainthood. Or you may crash, and arrive there more quickly.

8. Capitalists face these same trade-offs. We are called, by Christ, to treat both employees and customers as "thous," as persons made in the image of God, not as mere machines or money-sources. Yet if an employee fails to work productively, or a customer fails to pay, the "its" one produces will fail, which will harm other "thous" -- self, family, stock-owners, employees, devoted customers. This is a genuine dilemma for a believing businessman, exemplified by Jean Valjean in Les Miserables, who is trying to run businesses and help people, but then an employee falls through the cracks and is forced (out of his sight or knowledge, he's a busy man) into prostitution.

9. Trying to find the proper balance is inherently tricky. But so are moral choices in general -- an art, not a science, and an art that none of us practices perfectly.

10. Given that there is always a "quanta" of power in every society (Burke), those with great power will always find this balancing act more difficult, because their actions will impact more people, whose rights and needs will conflict.

11. Freedom is an absolute good. Adam and Eve in the Garden were given a choice. Jesus preached without compulsion or manipulation.

12. Free enterprise is therefore good in and of itself, though like the Garden, may act as a stage on which good or evil acts are taken.

13. The New Testament does warn: "If a man will not work, he should not eat." I think this implies that firing a lazy or dishonest employee is acceptable, as is giving lower wages to a less efficient employee -- though with an eye to mercy, and hoping that the "Thou" will repent or learn his job better. (Possibly by providing him with more schooling.)

14. There are incentives built into capitalism which can go either way. One may see it as effective to squeeze every last drop of blood out of one's employee, then drop him. Or one may recognize it as in one's "enlightened self-interest" to make her happy and healthy so she'll work harder and more honestly.

15. When one sees a capitalist treating employees as "thous," then, one may cynically, and perhaps correctly, suppose that he is merely acting in "enlightened self-interest," and despite the dogs-at-work policy, or the long holidays, he still sees employees essentially as "its."

16. Conversely, a genuinely compassionate manager may be forced by the demands of production and the many "thous" whom she cares for (children, aged parents, stock-holders, customers), to be very strict towards employees, to give less than they feel they need (one lump of coal, Bob Cratchit!), even to fire them in economic downturns.

17. In both cases, one should be careful in judging motives. God knows the heart.

18. In two parables, Jesus compared God to an employer who paid different wages to his managers, or paid laborers the same, even though some worked much longer hours than others. We are or should be equal before the law, but equality of outcome lies in tension with freedom and justice, since we are not equal in skill, honesty, luck, or value in I-it transactions, nor do we share equal needs or relationships with other workers or the boss.

19. The employers in both those stories seem to have been close enough to the action to know what was going on. In a large company, still more in government, it is often hard to figure that out.

20. Government rightly establishes rules to constrain those with power from abusing them. A just government (Madison recognized) must also recognize and make allowance for its own tendency to abuse power -- thus, "checks and balances."

21. Limited government is moral not only because it prevents the concentration of power, and therefore allows more freedom. But also, in countries where civilized norms of interaction are accepted, it is usually better to let people close to the situation figure the situation out and seek a just resolution. Outside intervention is sometimes necessary when local power has become corrupt, however, as in the South after the Civil War, or in lawsuits.

22. Freedom is not only an absolute good, it is also a relative good, because all else being equal, free competition encourages the production of more good things. By hypothesis, a Darwinian struggle tends to maximize the amount of life on a coral reef, or in a jungle. A struggle between companies likewise encourages a lively, rich, productive ecosystem of productive concerns.

23. But in a market in which competition is key, it is tempting to see competitors, or even employees and customers, as mere "its," bodies to drive off the road so one can get ahead.

24. At the same time, as Joseph Henrich shows in The WEIRDest People in the World, free markets have proven, even in remote regions of Africa, to encourage people to trust one another more. A strong correlation has been demonstrated between the presence of markets and how willing people are to trust strangers.

25. Competition occurs in non-capitalist societies as well. People will compete for food, sex, housing, fame, power, and living space regardless of whether cash is on the table. In New York City, for instance, there is it seems fierce competition for fixed-rent properties, which are a kind of wealth, hoarded by those rich enough in some sense to acquire them. In a communist Gulag, where money does not exist, competition is at its most ruthless, "Who-to-Whom," as Solzhenitsyn related.

26. Socialist countries may take cash off the table, or spread it around, but tend to concentrate power far more than countries with a free market. That is an empirical fact, demonstrated (I think) by history: no genuinely socialist society that I know of, has been very free, and most have been dictatorships, often governed by cruel tyrants.

27. Concentration of power is a necessary consequence of even democratic socialism. By taking money or stock away from "billionaires," (they used to say "millionaires," but those are now too common in capitalist countries to make a politically-auspicious target), the state necessarily concentrates power in its hands.

28. Even if the leader is elected by the people (democratic socialism), that concentration of wealth and power will draw unscrupulous people. "Power corrupts." It also attracts corrupt people, who become more corrupt by wielding it.

29. So while we always have a choice between seeing those around us as "thous" or "its," and both perspectives are to some degree valid at times, at least four systems emerge which create different practical incentives:

a. Capitalism without democracy. Here power is distributed economically, but concentrated politically.

b. Capitalism with democracy. Here power is distributed both economically and politically. However, growing wealth increases the relative political power of the wealthy. (Which can be offset by regulations, trust-busting presidents, and competition between capitalists.)

c. Socialism with democracy. Here power is distributed politically, but concentrated economically.

d. Socialism without democracy. Power is concentrated in both realms, and bad things tend to happen.

30. Yet all these systems also vary depending on culture, which ultimately derives from belief.

31. Both empirically, and theoretically, I think "b" is most moral, because it distributes power on two axis, and because market relations encourage people to trust one another more. We give strangers money every day, even let them into our homes (as I did an electrician yesterday), without compunction.

32. So no, capitalism does not make people corrupt, not more than other systems, though the rich of all kinds are tempted in special ways. It is as Jesus said of foods, money enters the pocket and is eliminated, but corruption creeps out of the heart.

33. Nor does capitalism save our souls, or make us genuinely moral beings. We can game any system. We can pretend to treat people as "thous," like the Pharisees, to seek the praise of men, while really only thinking of the bottom line.

33. Ironically, this past week, conservatives (including me) attacked a rich, white, male, 1% singer, and the rich, 1% capitalist TV and football executives who hired him. And then the Left rushed to defend that man. Some justified this by noting that he speaks Spanish, or because (I saw one say) to protect "brown" people from racist conservatives.

So now even "Christian" progressives are now celebrating a rich, white male 1%-er who sings in pornographic language about his many sexual conquests -- justifying it because he sings in Spanish, the language of some of the world's greatest imperialists.

An amazing inversion. And my criticism of that rich man is just what socialists say of capitalists in general -- that he treats "thous" (women) as "its," and encourages others, male and female, to do the same.

So clearly, capitalism does not ensure even minimal virtue, or protect society from the reward of its own twisted values. But while as a conservative, I have no problem with banning smut from public airwaves, or fining those who violate basic standards, I don't think the ultimate solution to America's moral problems can come from the top down. A society that winks at such exploitation, has become corrupt, and will corrupt all institutions, regardless of the structure of society.

In short, beginning with Adam and Eve, then Cain and Abel, freedom is a necessary, but insufficient, quality to allow us to recognize the Imago Deo in those around us, and respond to them as "thous," not mere tools for exploitation.