Following is an article that pretty well captures my thinking about
economics
the past few weeks. De Dora's essay refers to an article by Massimo
Pigliucci.
That essay is included verbatim, below, word-for-word. This is because
it makes it easy for readers to find it and read it without
hop-skip-and-jump
links and the need to reformat if you actually want to save or re-use
something. Here it is, ready to go.
This is part of my war against reflexive use of links and about formatting
generally
-a subject that seems to sail over the heads of tech whizzes obsessed with
the functions of computers and not ease-of-use.
But everybody does it that way? Maybe they do, but it has been my
experience that what "everybody does" is usually wrong, at least to
consider the kinds of issues now under review.
De Dora's article has been edited to cut out such things as his aside
about writer's block, etc, which isn't really germane to the topic.
A larger point is that it has stuck me that just about ANY discussion of
economics needs to also be a discussion of morality. Not in some clumsy
ham-fisted way, preaching church doctrine, but on behavioral merits.
Just what does this policy (your pick, infrastructure like the Dakota
access pipeline or anything else, or protectionism, or free trade)
actually do to human behavior or the health of American communities?
Economists call such considerations "externals." It is handy to know about
this word usage, but what is really external about it? It goes directly to
the nature of the kind of society we want to live in and to the
quality of life we want for ourselves.
This is parallel to another insight that recently flew into my head
from work on the issue of the effects of Popular Culture.
What is religion? Here is what most (overwhelmingly most) religious people
simply do not "get." For them there is true religion, their own, which
they
may not call "religion" at all but something like "faith" or "spiritual
path"
or the like. Some other religions may be sort of junior partners,
the way that Judaism is regarded by most Christians, but outside
of that, most "other" religions are side shows of no real interest.
This is even largely true among Evangelicals in Hawaii, where
you would think it would make really good sense for them
to look into Buddhism, since Buddhists are 1/4th of the population.
While there actually is some heightened interest in Buddhism among
Hawaiian Evangelicals it is only marginally greater than on the mainland.
There is no sense that there are such things as religious phenomena
that cut across just about all faiths and that it is legitimate to see
something of Christian morality in other religions, for instance,
or something of psychology familiar to Buddhists existing
in some schools of Hinduism, for example.
That is, with the glaring exception of Islam and some off-the-charts cults
(Scientology, Satanism, etc), nearly all religions have common foundations
-not in everything, obviously, but in a lot of basics. You know, how do
people treat each other? What should marriage consist of? What behaviors
simply do not fly if we want a functional community?
The point of all this is that if we want a moral society we would be
well advised to look into the moral effects of religious faith regardless
of which specific religion we are most familiar with. If religion
is subtracted, if the secular / libertarian / economistic war against
religion continues what would the consequences be?
And what substitutes for religion would arise? What new "religions"
that don't look like religions but have religious functions?
Economics and morality are similar. Just what are we getting morally
when we adopt one economic policy and not another? What is important
to remember is that "morality" has a much broader definition then
conventional church-designated morality
Social issues are "nothing but" wedge issues and are not really important?
That is just as much a load of crap as economic determinism, indeed,
it is a re-statement of economic determinism. Which even the Left
does not really believe because, you see, calling something a
wedge issue trivializes it so that the favorite social issues of
the Left can prevail.
We need to wake up to the effects -nearly all of them negative-
of libertarian thinking and values on our lives.
Billy
====================================
Economics should not be divorced from morality
By: Michael De Dora
2011
---------------------------------
Last week, our friend Massimo Pigliucci _published an essay_
(http://rationallyspeaking.blogspot.com/2011/07/why-i-dont-like-larry-summers.html)
here
in which he argued for
an idea I have long thought to be true: that economic considerations
cannot be divorced from moral ones. Here is the appropriate passage from
Massimo’s article:
“I simply do not buy the fundamentalist (yes, I’m using the term on
purpose) libertarian idea that economics is all there is or that should
count in pretty much all human transactions and
social problems. The hallmark of a just society is
precisely that it does consider issues of intrinsic rights — not just
to life and property, as the libertarians would have it —
but also to health, education, housing and jobs. Thewhole point of
living in a structured society, as opposed to Hobbes’ war of all against
all, is so that our lives are not going to be ‘solitary, poor, nasty, brutish
and short.’ Which means that what [Larry] Summers dismisses as ‘social
concerns’ really ought to be central to the way we structure our societies.
Economic systems ought to be the servants of human
flourishing, not itsmasters.”
The idea I would like to propose in this brief essay is this: economics
cannot be divorced from morality because one’s values determine which
economic structure he or she prefers. There are no such things as purely
economic
ends divorced from all other ends because economic decisions are made based
on moral values. They also have a moral impact on other people
Morality is the sphere of one’s foundational beliefs and attitudes about
right and wrong. Economics is the matter of how to set up and manage the
financial situation of a given society or community. I think it is clear that
morality, by its very definition, will play a major role in shaping the
economic structure of a given society. Morality simply shapes how we approach
most things in life, including economics. I also submit that economics is
inextricably tied to the welfare of the citizens for which it functions.
But people in several political camps, namely libertarianism and
neoliberalism, disagree that economics is so closely linked with morality.
They
believe economics is a discussion about business and bottom-lines, not ethics.
This divide is also present in political news coverage. Take _this quote_
(http://dispatchpolitics.com/live/content/insight/stories/2011/05/08/can-faith
-have-a-prayer-in-politics.html?sid=101) from Mark Caleb Smith, director
of the Center for Political Studies at Cedarville University: “Economic
issues always dwarf social issues. … [The 2012 election] is shaping up to be
an
economically driven election with a possibility of foreign affairs
entering the discussion as well.” This is precisely how most news outlets and
polling organizations frame pre-election public sentiments.
How many times have you heard that “people are voting on the economy, not
social issues, this election cycle"?
Yet, while economic issues are in some way different than social ones — in
the same way that, say, economics and philosophy are two different fields —
they are also undoubtedly intertwined at many levels. At the
interpersonal level, business transactions hinge on a basic sense of
morality.
When you purchase something, you trust that your source of information
(sales person, gas attendant, waiter/waitress, Amazon.com review) is being
honest about the quality of the goods offered. You also expect a certain
degree of performance from the product you are buying
Morality is also present in larger economic debates. Consider the question
“how can we create jobs?” At face value, there might be little in this
question that concerns morality. It is simply about increasing the number of
jobs available to human beings. But what if I answered that the way
to create jobs is to eliminate the minimum wage? Or to loosen
restrictions on workday hours and factory conditions? Or to lower the tax
burden
on corporations and the wealthy? Or to repeal last year’s health
insurance reform package? These questions all contain a
moral aspect as well.
Would it be right to allow companies to pay their employees however
little they can get away with? Would it be right to rescind worker
safety
laws? Would it be right to increase the tax burdens on the middle and
lower classes and allow further disparity? Would it be right to
repeal legislation that increases the availability
of health care?
No matter where you stand on these issues, you cannot deny there is a
moral component to all of them.
Someone might desire to settle the debate by asking, “what is best for the
economy?" But my point is that, at bottom, the question of “what is best
for the economy” is really a question of “what should we want the economy
to do or accomplish?” And that is a question not of pure mathematical
reasoning, but of ethical contemplation.
In closing, allow me to spell out how I think the relationship between
morality and economics might work. The first step is to figure out our
necessary assumptions. For instance, what is the nature of human behavior and
desires? How do humans act and interact? The second step is to think about our
shared moral goals. I think the _U.N. Declaration of Human Rights_
(http://www.un.org/en/documents/udhr/) is a good starting place for that. The
last
step is then to assess which economic ideas and systems to employ so that
our assumptions can be taken into account and that our goals can be
realized. Economics is not just about studying and applying knowledge of
trends,
numbers, math, and business practices. It is also about taking into account
the reality of human behavior and our moral concerns before making economic
decisions — and then considering the moral consequences of those decisions
=======================================
July 12, 2011
Massimo Pigliucci's Blog
_Why I don't like Larry Summers_
(https://www.goodreads.com/author_blog_posts/1369149-why-i-don-t-like-larry-summers)
by Massimo Pigliucci
(http://3.bp.blogspot.com/-K9EkHXI2H10/ThoSNc9ro4I/AAAAAAAAD3Q/4dILpUXl8UY/s1600/Summers.jpg)
I have to admit to a profound dislike for former Harvard President and
former Obama (and Clinton) advisor Larry Summers. Besides the fact that, at
least going by a number of reports of people who have known him, he can only
be characterized as a dick, he represents precisely what is wrong with a
particularly popular mode of thinking in this country and, increasingly, in
the rest of the world.
Lawrence was famously forced to resign as president of Harvard in 2006
because of a no-confidence vote by the faculty (wait, academics still have any
say in how universities are run? Who knew?) because of a variety of
reasons, including his conflict with academic star Cornel West, financial
conflict of interests regarding his dealings with economist Andrei Shleifer,
and
particularly his remarks to the effect that perhaps the scarcity of women in
science and engineering is the result of innate intellectual differences.
Now I have acquired yet another reason to dislike Summers, while reading
Debra Satz's _Why Some Things Should not Be for Sale _
(http://www.amazon.com/Why-Some-Things-Should-Sale/dp/0195311590/ref=sr_1_1?s=books&ie=UTF8&qid=13
10320351&sr=1-1) : The Moral Limits of Markets, which I highly recommend
to my libertarian friends, as much as I realize of course that it will be
entirely wasted on them. The book is a historical and philosophical analysis
of ideas about markets, and makes a very compelling case for why thinking
that "the markets will take care of it" where "it" is pretty much anything
of interest to human beings is downright idiotic (as well as profoundly
unethical).But I'm not concerned here with Satz's book per se, as much as with
the instance in which she discusses for her purposes, a memo written by
Summers when he was chief economist of the World Bank ...
The memo was intended for internal WB use only, but it caused a public
uproar when the, surely not left-wing, magazine The Economist leaked it to
the public. Here is an extract from the memo (emphasis mine): "Just between
you and me, shouldn't the World Bank be encouraging more migration of the
dirty industries to the less developed countries? I can think of three
reasons: 1. The measurement of the costs of health-impairing pollution depends
on
the foregone earnings from increased morbidity and mortality. From this
point of view a given amount of health-impairing pollution should be done in
the country with the lowest cost, which will be the country with the lowest
wages. I think the economic logic behind dumping a load of toxic waste in
the lowest wage country is impeccable and we should face up to that. 2. The
costs of pollution are likely to be non-linear as the initial increments
of pollution probably have very low cost ... Only the lamentable facts that
so much pollution is generated by non-tradable industries (transport,
electrical generation) and that the unit transport costs of solid waste are so
high prevent world-welfare enhancing trade in air pollution and waste. 3.
The demand for a clean environment for aesthetic and health reasons is likely
to have very high income elasticity ... Clearly trade in goods that embody
aesthetic pollution concerns could be welfare enhancing.
The problem with the arguments against all of these proposals for more
pollution in least developed countries (intrinsic rights to certain goods,
social concerns, lack of adequate markets, etc.)could be turned around and
used more or less effectively against every Bank proposal for
liberalization. "Now, pause for a minute, go back to the top of the memo, and
read it
again. I suggest that if you find nothing disturbing about it, your empathic
circuitry needs a major overhaul or at the very least a serious tuneup.
But it's interesting to consider why. As both The Economist (who called the
memo "crass") and Satz herself note, the economic logic of the memo is
indeed impeccable.
If one's only considerations are economic in nature, it does make perfect
sense for less developed countries to accept (for a — probably low —
price) the waste generated by richer countries, for which in turn it makes
perfect sense to pay a price to literally get rid of their shit. And yet, as I
mentioned, the leaking of the memo was accompanied by an outcry similar to
the one generated by the equally infamous "_Ford Pinto memo_
(http://www.dummies.com/how-to/content/true-conspiracy-the-ford-pinto-memorandum.html)
"
back in 1968. Why? Here I actually have a take that is somewhat different
from, though complementary to, that of Satz.
For her, there are three ethical objections that can be raised to the
memo: first, she maintains that there is unequal vulnerability of the parties
involved in the bargain. That is, the poor countries are in a position of
marked disadvantage and are easy for the rich ones to exploit. Second, the
less developed countries likely suffer from what she calls weak agency,
since they tend to be run by corrupt governments whose actions are not in the
interest of the population at large (whether the latter isn't also true of
American plutocracy is, of course, a matter worth pondering). Third, the
bargain is likely to result in an unacceptable degree of harm to a number of
individuals (living in the poor countries) who are not going to
simultaneously enjoy any of the profits generated from the "exchange.
"I think all these reasons surely hold, but I would go further and talk of
precisely the sorts of things Summers himself mentions in the memo,
particularly intrinsic rights to certain goods and social concerns. I simply do
not buy the fundamentalist (yes, I'm using the term on purpose) libertarian
idea that economics is all there is or that should count in pretty much
all human transactions and social problems. The hallmark of a just society is
precisely that it does consider issues of intrinsic rights — not just to
life and property, as the libertarians would have it — but also to health,
education, housing and jobs.
The whole point of living in a structured society, as opposed to Hobbes'
war of all against all, is so that our lives are not going to be "solitary,
poor, nasty, brutish and short." Which means that what Summers dismisses
as "social concerns" really ought to be central to the way we structure our
societies.
Economic systems ought to be the servants of human flourishing, not its
masters.
The only serious question here is what was someone like Summers doing in
both the Clinton and Obama administrations? The answer is that this (and
plenty of other inconvenient or disturbing facts, depending on your political
persuasion) clearly shows that both Clinton and Obama were moderate
centrists, certainly not the "socialists" and "radicals" that
Republican-generated
nonsense would have them be.
By the way, did you notice Summers' point that if one objected to his memo
on ethical grounds one may just as well object to pretty much every policy
suggested by the World Bank? Ponder the consequences, then start asking
for the closing or radical restructuring of the World Bank.[image error]
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