Abrahamic Responses to the Economy

Michael Moore’s new film Capitalism: A love story (see www.michaelmoore.com) takes a critical look at capitalism and in it he interviews a number of priests and asks them whether they think capitalism is compatible with Christianity. It might come as a surprise that most said they thought it was not! There is a great deal of discussion about the situation that the world economy now faces. Ethics is now viewed by many as a crucial element to business. Within the Abrahamic traditions a number of senior religious leaders have addressed the moral question of the market. Two responses show the value of a distinctively religious perspective, one from the Chief Rabbi Jonathan Sacks and the second from the Archbishop of Canterbury Rowan Williams.

Chief Rabbi Jonathan Sacks

Writing in The Times in March this year in a piece entitled “Morals: the one thing markets do not make” (available at www.chiefrabbi.org/ReadArtical.aspx?id=1482) Rabbi Sacks cautions against the pursuit of scapegoats but questions whether we might think more deeply about our values. Sacks recounts a conversation with a retired leading industrialist who had been astonished when his successor took a salary of ten times as much as he had taken. Then his successor systematically destroyed the company. Another man he spoke to had commented that in the past the first thing he had to do when making a deal with someone was establish the character of the person. But now it is all about the lawyers. What seems to be disappearing is values, a cluster of principles which we might find coming from religion, morality, conscience, tradition or a code which put limits on what should be done. He writes “without that internalised code of honour and trust, no institution can be sustained for long”. Behavioural economist Herbert Gintis referred to this in a recent paper:

“Current models of economic relationships teach students that managerial and employee contracts cannot be based to any significant degree on trust or trustworthiness. This view, in turn, sets in motion a self-reinforcing cycle in which students come to see opportunistic behaviour, including lying and cheating, as unavoidable and hence as morally acceptable.

Neoclassical economics… encourages an ethic of greedy materialism in which managers are expected to care only about personal financial reward, and in which such human character virtues as honesty and decency are deployed only contingently in the interests of personal material reward.”
(http://papers.ssrn.com/sol3/papers.cfm?abstract_id=929173)

Sacks sees the modern era as one which has lost the belief that you need some sort of moral sense. We have lost the distinction between the value of things and the price of things. A house has a price, but a home has a much greater value providing shelter, a haven and personal space. House prices soared – their attraction as investments grew and people saw an opportunity to make money without any regard for what would inevitably happen. In a recent radio interview a mortgage broker admitted that he and his fellows would lie to people to make sure he got them to sign for the mortgage and what is more that is what many of his fellows were doing. He knew he was not telling the truth. He knew that they would not be able to make the repayments. Sacks argues that markets need morals, as they do not guarantee equity, responsibility, integrity or honesty.

“When it comes to flagrant self-interest, they combine the maximum temptation with the maximum opportunity. Markets need morals, and morals are not made by markets.”

Sacks argues economics need ethics but those ethics or morals come from all sorts of influences: schools, media, custom, tradition, religious leaders, moral role models and people. But if religion loses its voice, then the media, which worships success, will replace those morals with its own. Sacks has made an interesting link here between the pursuit of money and success. In modern times success is the desired goal, at least in the ideas of the media. Yet this is encouraged elsewhere. In schools, a focus on performance, and success on an individual or school level will not provide the moral character Sacks alludes to. There is not space for integrity on school reports, no place for honesty in Government league tables. Yet these things matter.

Archbishop Rowan Williams

Writing also in March 2009 (see full text here: www.archbishopofcanterbury.org/2323) Williams develops similar themes. He focuses on patience and trust as virtues needed for the economy. In the modern world there is an emphasis in the markets on quick performance. The idea that an enterprise might take time to come to fruition seems to have disappeared. This in turn affects trust. Trust in relationships takes time to grow. It is earned gradually, rather than automatically. It includes human judgment in terms of one’s own character and that of others. It is found in a shared culture of understanding.

While some see greed as the cause of the problems, Williams argues that it goes deeper. Like Sacks he thinks it is easy to blame the current situation on an accumulation of greed. In fact the situation came about because of a crisis of moral ecology – of unregulated capitalism which led to a spiralling crisis of moral indifference, institutional crisis and market failure, each feeding the other. Yet there seemed to be no recognition that there was a vulnerability. Williams argues that it is essential to realise that there is a vulnerability, a weakness in the situation – a powerlessness. Hence the test of a civilization: judged by how it treats the weak members of its society – children, elderly, sick or disabled. He writes: “To be an ethical agent is thus to be aware of your own frailty.” And there is a specifically Christian ethics that comes from this “the duty of care for the neighbour as oneself is bound with an injunction to forgive as one hopes to be forgiven”. Early forms of capitalism seem to have been much more aware of this. They sought to limit liability and share profit. They sought to provide security in the risky endeavour. It acknowledged a lack of control. But modern financial products have become the favoured basis for the economy and when the market is not regulated effectively no one is watching for the scarcity of credit. The absence of regulation might seem attractive to governments wanting to encourage expanding spending power of their electorates. The legitimacy of a government becomes its ability to let you spend more. It encourages us to think that we are individual agents and that the most important thing is greater and greater choice possibilities. But there is a tension between an unhealthily controlled economy and a poorly regulated economy. If that tension is forgotten then confusion and fantasy is the result. Consider the endless adverts which say you can have whatever you want – you can afford things you do not have the capital to buy. The cascading offers of credit cards and interest free purchases had to increase exponentially to almost frenzied levels to keep the stack of cards going. Massively inflated credit meets crisis when it is called in. Williams says that economic understanding is difficult but that we are all economists now (or need to be) and he suggests a numbers of steps including these three:

1. We must move away from models of economics based on generating money, away from the idea of risk-less profit and the place of trust must be restored.
2. Economic calculations must include environmental costs.
3. We must rethink the role of government in market monitoring and regulation at an international level

As a priority he remembers the most vulnerable. Ethics, he suggests, is about negotiating conditions where the most vulnerable are not abandoned. A religious perspective has a distinctive offering. When viewing the financial crisis we can ask, “‘what for’? what is growth for? for what or whom is wealth important?” The world is not fully understood by human beings but there is a greater reality which does understand, one that religious traditions call God. It is to this world that human beings belong. God made the world and called it good, but it is broken now and human beings must lament that brokenness. In addition Williams proposes three ways forward, informed by this tradition, and he presents them as virtues:
1. Trustworthiness: That faith depends on a god who keeps promises and can be trusted. So to live in harmony with god means being promise-keepers in all aspects of life, including finance.
2. Realism or humility: The view of faith is one in which human beings are aware they are a part of creation with great power but not wholly in control.
3. Resistance to policies which benefit some at the expense of others: Living as part of creation brings a sense of the common destiny and common predicament of humanity. The ideal human community is one in which the welfare and giftedness of each and the welfare of all are inseparable.

Both Archbishop Rowan Williams and Chief Rabbi Jonathan Sacks identify virtues in the Christian and Jewish traditions which offer a stronger basis for a sounder and more ethical economy. Whether these virtues will be encouraged by government, business or even education remains to be seen.

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