Virtue and Capital

The primary virtue of capitalism is the way it holds you accountable for your actions. Do something stupid or bad, and people stop buying from you. Do something remarkable and good, and people buy more from you. That’s the idea anyway.

The problem with headlong deregulation of the industry over the past twenty years, combined with the moral hazard of “too big to fail” is that we have boosted rewards while removing accountability. We are, then, in danger of stripping capitalism of whatever moral legitimacy it may have attained since Teddy Roosevelt began building barriers to rampant exploitation.

Take away the accountability, and you remove the virtue. Experience has shown that self-regulation is inadequate.

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4 thoughts on “Virtue and Capital

  1. Couldn’t agree more. Though I never thought about capitalism as a particularly moral system, the current lack of accountability is just outrageous.
    By the way, I also live in Beijing. Currently enjoying the New Year festivities with all the firecrackers and all the floor-shaking…

    • Re: fireworks: fun, isn’t it? Rather like living in a battle zone.

      To my point, capitalism comes in many forms, but the argument that it is self-regulating is so much nonsense. When it is under-regulated, accountability dies. When it is over-regulated, opportunity dies.

      Our quest is to find the correct mid-point between the two extremes, and a coherent moral code has to guide us in our search for that mid-point, methinks.

      Best,

      David

  2. Self-regulation is bad?

    Ok, well then why don’t I regulate your behavior, just because it’s impossible that you could regulate your own.

    Hmm I wonder what makes me qualified to regulate your behavior if none of us are supposedly able to self-regulate.

    I guess it must be the same thing that qualifies the state to regulate everyone’s behavior but their own.

    But wait, isn’t government made of people – just like us? So aren’t they just as inadequate?

    Your view of humanity is that we’re all evil, or idiots, or both. That’s why you think people need to be regulated.

    Mine is that we’re all intelligent and moral. That’s why I think people need and deserve freedom.

    I like mine better.

    • Tiffany, you misread what I posted. I did not say self-regulation is bad. What I said is that it is inadequate. If self-regulation worked by itself, we would have no need need checks and balances in our governmental system, for speed limits, indeed for laws at all. You and I actually share a core point of view: too much regulation is a bad thing, and the government is not qualified to regulate to the degree that it wishes to do so. But I do not submit to the implicit argument that the choice is either facism or some form of enlightened anarchy.

      As to my view of humanity, allow me to clarify. I believe we are composed of an inclination toward good and an inclination toward evil, and that most if not all of us spend our lives trying to find a balance between the two. I believe that shared codes of behavior, whether in the form of laws, religious precepts, or a code of biocentric ethics like that espoused by Peter Singer are essential guides in that effort.

      I think we both agree that people deserve freedom, but I have discovered that people define freedom differently. How would you define it?

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