In a recent
NY Times Opinion piece, William Deresiewicz argued that capitalism closely parallels attributes of psychopaths. I found the following paragraph to be provocative:
There are ethical corporations, yes, and ethical businesspeople, but ethics in capitalism is purely optional, purely extrinsic. To expect morality in the market is to commit a category error. Capitalist values are antithetical to Christian ones. (How the loudest Christians in our public life can also be the most bellicose proponents of an unbridled free market is a matter for their own consciences.) Capitalist values are also antithetical to democratic ones. Like Christian ethics, the principles of republican government require us to consider the interests of others. Capitalism, which entails the single-minded pursuit of profit, would have us believe that it’s every man for himself.
Deresiewicz uses strong language and, I think, overstates his case. He also adopts a narrow, American-centric perspective that is ignorant of other forms of capitalism and corporate governance models around the world.
Let me be clear that I am not a proponent of an unbridled free market. I consider that regulation is often necessary and beneficial. I also do not dispute that there is a crisis of ethics in big business (and probably in small business, too, but the latter is far less reported than the former). Just this morning, I wondered to myself how much big business really does control government. I suspect that if we knew the truth, we would be sick to our stomachs.
But the problem is not capitalism, per se. The problem is us: humans tend to be proud, greedy, vain, and self-centred. (Don't look away. You know it is true. We are what we are.) When you combine human nature with a socio-economic system that centres on private property rights and the individual accumulation of wealth, you can bring out the worst in some people.
People are not fooled into the single-minded pursuit of profit by capitalism, nor are they forced to pursue profit single-mindedly by capitalism. People make choices within the system of capitalism. To blame capitalism for the psychopathic behaviour we see on Wall Street and Bay Street ignores human agency and, thus, human responsibility.
Deresiewicz paints capitalism with a broad brush, and this is a fundamental mistake and bad scholarship. The reality is that there are a variety of approaches to understanding capitalism that are shaped by different influences (e.g., academic discipline, history, culture, geography, etc.). It is a mistake to assume that everyone around the world shares the same ideas about capitalism, its morality (or lack thereof), its key values and characteristics, and the rationales for its existence.
For example, German and Chinese models of corporate governance differ in materials ways from the North American model. In North America, a corporation's Board of Directors has an obligation to pursue "the best interests of the corporation", which generally is interpreted as "maximizing shareholder value". Deresiewicz might interpret this imperative as "profit at all costs". I'm not sure that he would be correct in this interpretation. But quite aside from the interpretation of what it means to "maximize shareholder value", the fact is that not all models of corporate governance are premised on the maxim of "maximize shareholder value". In Germany, by contrast, a corporation's Board must take into account a wider range of interests, including the interests of employees. Indeed, labour is entitled to be represented on a corporation's Board of Directors.
Deresiewicz also overstates his case concerning the relationship between capitalism and Christianity. It is actually difficult to ascertain whether capitalist values are antithetical to Christian values because capitalism and Christianity are, at their respective cores, concerned with different matters. Capitalism is a socio-economic and political system concerned with how wealth is created and distributed in society. Christianity is about the relationship between each individual and the Triune God. Capitalism is about the present; Christianity is about the present and the eternal.
To be sure, Christianity has important repercussions for our political, social, and economic spheres of life. But the Bible is not about how to create and distribute wealth in society. It is about how to live in relationship with the Holy Triune God. This God is a just God who cares very deeply about the poor in society. God chastises pride, greed and self-centredness, as well as deceit, cheating, and injustice. But when God does so in the Bible, the chastisement is directed at individuals, not systems of governance. I return to my earlier point: capitalism is not the problem; people are.
It is somewhat ironic that Deresiewicz argues that capitalist values are antithetical to democratic values since most capitalist countries are also democratic ones. I am not suggesting here that there is a causal or necessary relationship between capitalism and democracy. Nevertheless, there seems to be an intellectual link between the concept of private ownership and individual rights to property and the individual rights exalted in liberal democratic societies. Is it any surprise that the communist regimes of the past century have also been the most repressive?
Deresiewicz suggests that capitalism is predicated on bad behaviour. This may be true (although I have reservations about such a bold and broad claim). But are the ills associated with capitalism a result of capitalism or bad behaviour? Blaming capitalism for the rampant corruption and other social ills we see in the business world is like saying "the devil made me do it". Deresiewicz's arguments find a handy scapegoat in capitalism at the expense of human agency.
Ultimately, my biggest squabble with Deresiewicz is his disregard of human agency and responsibility. We cannot blame a system for accounting fraud, tax evasion, toxic dumping, product safety violations, bid rigging, overbilling, perjury, and other forms of unethical behaviour. While it is true that systems create incentives, people are the movers. We make choices -- and our choices result in the litany of social ills that Deresiewicz attributes to capitalism.
It is precisely because we humans have a propensity to make poor choices that I support limits on "free market, laissez-faire"-type capitalism. I am only all too aware (from knowing myself) of the selfish, proud, and greedy motivations that animate individuals. We need regulation to put a human face on capitalism and to ensure that its excesses do not spill into injustices. I would venture to say that we need better regulations and tighter controls at present to stem the tide of unethical, corrupt and destructive practices we see in the business world. But better regulation and tighter controls are not enough.
We need better personal accountability and responsibility. We need a serious re-evaluation of the values that are reflected in our culture. We need to reflect on our role in facilitating the tide of unethical, corrupt and destructive practices we see in the business world. We need to stop blaming capitalism, corporations, and Enron, and start to own the problem.
As wise men and women have been saying for centuries, "know thyself". Or, as Pogo more recently be put it, "I have seen the enemy and he is us".
