The Morality of Economics

...concur with much of this, but perhaps the author should further examine Millennium Ecosystem Assessments before labelling concerns re: resources to support human population as an ideology!

Excerpt from article by Richard Cook on Bill Totten's weblog, 25 November 2009

'...For the past quarter century, economic life, under the rubric of globalization, has increasingly been based on such overt or covert precepts as, "survival of the fittest", "privatization", "might makes right", "money talks", "whoever has the gold rules", and "let the buyer beware".

All are basically reflections of the profit motive versus any ideal of charity, compassion, or service. Indeed, mention of such lofty motivations is even likely to evoke sneers among self-anointed "realists". But the fact is that laws and practices have been increasingly marked by greed for gain by some at the expense of everyone else, which is an indicator of a society-wide relapse into barbarism.

These trends have been abetted by the contention that economics is a science, somehow similar to physics, which describes the behavior of "forces" that are essentially amoral. The primary such force, perhaps, is the postulated existence of an impersonal "market", the functioning of which, even when appearing ruthless, supposedly results in the common good. A recent example may be found in a statement by Secretary of the Treasury Henry M Paulson to Fortune magazine predicting a global economic downturn. Paulson said, "It's just that we're not going to defy economic gravity". By placing his forecast on a par with the most relentless of all physical laws, Paulson lends an aura of inevitability to events which, if they occur, could be devastating to billions of people.

By implication, Paulson also denies the possibility of any political choice about the likely event, even though it would be at least partially a result of the housing bubble, the biggest such financial travesty in history, which the Federal Reserve, along with the last several presidential administrations, have contributed to creating in the absence of any genuine economic driver for the US economy.But such "forces" as policy-makers buy into are usually manmade. Further, more than people realize, the way a nation's economy functions is a reflection of its moral choices and values. The "market" behaves as it is designed to behave and distributes its benefits accordingly. The upside of this observation is that an economic system can be altered to reflect a higher moral vision...

Tribal and agrarian societies, including much of the United States through at least the end of the nineteenth century, were based on technologies that allowed people to survive at a subsistence level with minimal interference by outside experts or authorities.

The same was true of the agricultural and peasant classes of Europe until recent times. Even during the so-called "Dark Ages", the masses of people were able to subsist off the land even as the warrior castes slaughtered each other.

All this changed through the mechanization of work brought about by the industrial revolution. Now more could be produced by fewer workers. The first of many epoch-making innovations was the application of steam power to the operation of machines. Observers believed naively that mankind had now evolved to such a degree that the curse of labor had been lifted and that the human race would now be free from merely having to earn a living and could devote itself to higher pursuits.

But it turned out that the benefits of industrialization flowed mainly to those who controlled the processes of production. Those who did the work, or those whose work was no longer needed, were left out. The system which imposed this paradigm was capitalism. It was opposed by a variety of ideologies, including various types of socialism and trade unionism, which argued that the gains in productivity really should be viewed as the property of the community, not just a handful of those with economic and political power. In recent years, capitalism has conquered most of the world, even in countries that still may consider themselves socialist, such as China.

The brand of capitalism that has become the most powerful is finance capitalism, based ultimately on the lending of money at interest. Backing up this system is the greatest arsenal of weapons of mass destruction ever seen.

There was a time when such lending, particularly at excessive rates of interest, was condemned as usury, but no more. Now it is even a matter of official policy that the central banks of the world may raise interest rates as high as they wish if they are able to make the claim that they are fighting inflation or making borrowers more responsible. The name for this policy is "monetarism". But this justification of lending practices that many ethical authorities in history have regarded as criminal is an excuse, not a reason.

As a result of capitalism, much of the world's population has increasingly been left out of the prosperity and material security that industrialization once seemed to promise. Around the world, the benefits clearly have accrued mainly to the upper income echelons, while the majority of people are left to struggle. The results increasingly are un- or under-employment, poverty, lack of adequate nutrition or health care, or even, in many countries, starvation.

Within the United States alone, thirty-five million people are malnourished and almost a million are homeless, including some war veterans. No one could possibly argue that all of these people are personally at fault and that none are suffering because of the type of economy we have chosen to embrace. Yet for many, poverty and homelessness are a death sentence, whether through ill health, exposure, or violence, because in economics, due process and equal protection of the laws no longer seem to apply. Faced with such situations, another ideology has sprung up based on the idea that there are not enough resources on the earth to support the human population, so that many must simply die - with the exception, of course, of oneself, one's friends and family, one's co-religionists, or one's countrymen. Overly-pessimistic alarms about such phenomena as global warming also become part of the litany of doomsayers.

...Each individual should be granted, as a basic human right, a sufficient amount of money to survive at a subsistence level. Such an income should be made as a recurring cash payment by every government, or on a worldwide basis by the United Nations. Richer nations should provide poorer ones the means to do this if necessary. There is no reason except human ignorance why poverty worldwide could not be eliminated now through a basic income guarantee...

Credit should be viewed as both a public utility and a human right and should be made available at minimal cost - no more than one percent interest payable to whatever public agency is charged with administering the program. Banks have the privilege of creating credit "out of nothing". Governments, which grant banks this privilege, should have it also and could and should exercise it to the benefit of their populations...

...We must realize that as long as a single person on earth is unfairly denied sustenance, we remain barbarians. Everywhere in the world people are waking up to the fact that the work of applying enlightened concepts of morality to economics is the key task which mankind faces in the twenty-first century. Unfortunately, as of this writing, there are signs that those in power are making plans for another wave of warfare and violence to hold the day of reckoning at bay. But they cannot do so forever.'