Posts tagged economy

Six reasons to use reusable grocery bags

From the Huffington Post:

  1. Plastic bags take anywhere from 15 to 1,000 years to decompose.
  2. Only 1 percent of plastic bags are recycled in the United States. The rest end up in landfills, the ocean, or some other place in the environment. There’s actually a giant garbage heap made mostly of plastic floating in the ocean that’s twice the size of the United States.
  3. It’s estimated that 1 million birds and thousands of turtles and other sea animals die each year after ingesting discarded plastic bags.
  4. More than 10 percent of washed-up debris polluting the U.S. coastline is made up of plastic bags.
  5. It takes 12 million barrels of oil to produce the estimated 100 billion plastic bags Americans use each year.
  6. The petroleum used to produce 14 plastic bags can drive a car one mile.

These reasons are precisely why I started to use reusable bags several years ago. In fact, I now feel morally guilty when using plastic bags. I consider our treatment of Earth a moral issue, and I know plastic bags wreak environmental havoc.

Do you use reusable bags? And, if not, why?

Moral economy quiz

The Center for American Progress has posted what I think is an interesting and challenging quiz in which you have to match famous political, business, and religious leaders to quotes on the ethics of capitalism:

Debate over what constitutes a moral economy is back. The Ryan Budget rolled out last month drew outrage and criticism from prominent faith leaders including Bishop Gene Robinson, Father Thomas Kelly, and Rabbi Jack Moline. Also last month, Goldman Sachs Executive Director Greg Smith announced his resignation from the firm with a public letter in The New York Times.

Smith isn’t the first businessman to assert that morality has an important role to play in the capitalist system, and Robinson, Kelly, and Moline are not the first religious leaders to demand an economy that works for the most vulnerable members of society. Historical figures on both sides of the political aisle, and in both the private and public sector, have advocated for responsible capitalism.

Give the quiz a try here.

You can read my previous postings on this subject here, here, and here.

Morality on Wall Street?

Keeping on the topic of morality and economics, you might have heard that earlier this week a former Goldman Sachs executive, Greg Smith, detailed in the New York Times outlined why he was leaving the company:

To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money. Goldman Sachs is one of the world’s largest and most important investment banks and it is too integral to global finance to continue to act this way. The firm has veered so far from the place I joined right out of college that I can no longer in good conscience say that I identify with what it stands for.

When the history books are written about Goldman Sachs, they may reflect that the current chief executive officer, Lloyd C. Blankfein, and the president, Gary D. Cohn, lost hold of the firm’s culture on their watch. I truly believe that this decline in the firm’s moral fiber represents the single most serious threat to its long-run survival.

The widespread response to Smith’s article has the Times focusing its newest edition of “Room for Debate” on the question:

"Does morality have a place on Wall Street?"

Check out the eight responses by clicking here.

What isn’t for sale?

You might recall that a couple weeks ago I posted about the forthcoming book from Harvard University political philosopher Michael Sandel, titled What Money Can’t Buy: the Moral Limits of Markets. I am particularly excited for What Money Can’t Buy because Sandel has authored several of my favorite books, such as Public Philosophy: Essays on Morality in Politics and Justice: What’s the Right Thing to Do?

It turns out Sandel is now giving people a brief preview of the book, which is out April 24, on The Atlantic. Check it out:

While it is certainly true that greed played a role in the financial crisis, something bigger was and is at stake. The most fateful change that unfolded during the past three decades was not an increase in greed. It was the reach of markets, and of market values, into spheres of life traditionally governed by nonmarket norms. To contend with this condition, we need to do more than inveigh against greed; we need to have a public debate about where markets belong—and where they don’t…The difference is this: A market economy is a tool—a valuable and effective tool—for organizing productive activity. A market society is a way of life in which market values seep into every aspect of human endeavor. It’s a place where social relations are made over in the image of the market. The great missing debate in contemporary politics is about the role and reach of markets. Do we want a market economy, or a market society?

You can pre-order What Money Can’t Buy here.

Michael Sandel’s forthcoming book

Harvard University political philosopher Michael Sandel has authored several of my favorite books, including Public Philosophy: Essays on Morality in Politics, and most recently, Justice: What’s the Right Thing to Do?

Sandel is now back with a new book, titled What Money Can’t Buy: the Moral Limits of Markets. From Amazon:

Should we pay children to read books or to get good grades? Should we put a price on human life to decide how much pollution to allow? Is it ethical to pay people to test risky new drugs or to donate their organs? What about hiring mercenaries to fight our wars, outsourcing inmates to forprofit prisons, auctioning admission to elite universities, or selling citizenship to immigrants willing to pay?

In What Money Can’t Buy, Michael J. Sandel takes up one of the biggest ethical questions of our time: Isn’t there something wrong with a world in which everything is for sale? If so, how can we prevent market values from reaching into spheres of life where they don’t belong? What are the moral limits of markets?

In recent decades, market values have crowded out nonmarket norms in almost every aspect of life—medicine, education, government, law, art, sports, even family life and personal relations. Without quite realizing it, Sandel argues, we have drifted from having a market economy to being a market society.

In Justice, an international bestseller, Sandel showed himself to be a master at illuminating, with clarity and verve, the hard moral questions we confront in our everyday lives. Now, in What Money Can’t Buy, he provokes a debate that’s been missing in our market-driven age: What is the proper role of markets in a democratic society, and how can we protect the moral and civic goods that markets do not honor and money cannot buy?

The book is due out April 24, 2012. You can pre-order it here. Trust me: the book should be an outstanding read.

Enjoy your weekend.

Morally indefensible budget cuts

As I’ve written before, you don’t often hear liberals base their economic arguments on moral concepts. For instance, consider the recent battle between Republicans and Democrats over taxes and the federal deficit. President Barack Obama has proposed normalizing taxes on the wealthy. Republicans have charged that Obama is promoting “class warfare.” Obama’s answer: my proposals are "just math."

Turns out I’m not alone in thinking this sort of response is a major problem. Here’s Robert Reich writing in the Christian Science Monitor:

We’re in the worst economy since the Great Depression — with lower-income families and kids are bearing the worst of it — and what are Republicans doing? Cutting programs Americans desperately need to get through it. …

[Obama’s deficit reduction plan is] more than math. It’s a matter of morality.

Republicans have posed the deepest moral question of any society: whether we’re all in it together. Their answer is we’re not.

President Obama should proclaim, loudly and clearly, we are.

You can read the rest here.

The misguided debate on regulations

As you probably already know, American politicians are in the midst of an intense debate on how to create domestic jobs. One argument repeatedly made by Republicans is to cut workplace and environmental regulations, which they charge are job killers.

Factually, the Republicans’ claim does not seem to hold up.

However, imagine for a moment that the Republicans’ claim is true. The most obvious question would be, “Is cutting regulations the only, or even the best, way to create jobs?” Yet I think there is a more important question that Democrats continue to not ask:

"Would it be ethical to cut regulations that protect worker safety and the environment to create jobs?"

I think you know how I would answer this: absolutely not.

Don’t worry: God’s got the economy

From the Washington Post:

About one in five Americans combine a view of God as actively engaged in daily workings of the world with an economic conservative view that opposes government regulation and champions the free market as a matter of faith.

“They say the invisible hand of the free market is really God at work,” said sociologist Paul Froese, co-author of the Baylor Religion Survey, released Sept. 20 by Baylor University in Waco, Texas.

“They think the economy works because God wants it to work. It’s a new religious economic idealism,” with politicians “invoking God while chanting ‘less government.’”

If you believe in an omniscient and omnipotent God, it makes sense to also think God would take care of things like the economy. Of course, questions concerning the existence of God, and his potential political views, are different matters.

Fortunately, there is some good news for liberal-minded people:

At the opposite pole, another one in five Americans don’t see God stepping in to their daily lives and favor reducing wealth and inequality through taxation.

“So they’re less likely to see God controlling the economy. Liberal economic perspectives are synonymous with the belief that there is no one ‘ultimate truth,’” Froese said.

The battle for the other 60 percent does not one bode well for liberals, who are tasked with articulating a complex view of worldly affairs to Americans human beings who are not often ready to accept that truth is a complicated issue.

The immoral treatment of the poor

The New York Times yesterday published a fantastic editorial ripping Republicans who say they want to fix America’s debt problem by, of all things, increasing taxes on the poor (while, of course, keeping tax breaks for corporations and the rich). Leading Republicans often complain that nearly half of Americans do not pay income taxes, and demand everyone “have some skin in the game.” The Times editorial corrects this thinking factually, economically, and morally:

This is factually wrong, economically wrong and morally wrong. First, the facts: a vast majority of Americans have skin in the tax game. Even if they earn too little to qualify for the income tax, they pay payroll taxes (which Republicans want to raise), gasoline excise taxes and state and local taxes. Only 14 percent of households pay neither income nor payroll taxes, according to the Tax Policy Center at the Brookings Institution. The poorest fifth paid an average of 16.3 percent of income in taxes in 2010.

Economically, reducing the earned income tax credit and the child tax credit — which would be required if everyone paid income taxes — makes no sense at a time of high unemployment. The credits, which only go to working people, have always been a strong incentive to work, as even some conservative economists say, and have increased the labor force while reducing the welfare rolls.

The moral argument would have been obvious before this polarized year. Nearly 90 percent of the families that paid no income tax make less than $40,000, most much less. The real problem is that so many Americans are struggling on such a small income, not whether they pay taxes. The two tax credits lifted 7.2 million people out of poverty in 2009, including four million children. At a time when high-income households are paying their lowest share of federal taxes in decades, when corporations frequently avoid paying any tax, it is clear who should bear a larger burden and who should not.

Economics should not be divorced from morality

By Michael De Dora

Last week, my friend Massimo Pigliucci published an essay  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. 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 [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 its masters.”

As it turns out, I have been thinking about the relationship between morality and economics for a couple of months now. However, my thoughts have remained scattered in a Word document sitting in a folder on my laptop with several other essay ideas that are incomplete. Unfortunately, I have been suffering from an extended case of writer’s block coupled with real-world demands (you know, my full-time work advocating for reason and science at the Center for Inquiry). So, I should thank Massimo for piquing my interest in writing again.

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. 

At this point, I should define my terms. 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 informs how one approaches many issues, including economics. I also think it is clear that economics is inextricably tied to welfare of the citizens for whom it functions.

But many people disagree, holding that economics and social issues (moral issues) are two different arenas. For example, take this quote 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 agencies 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?

Fortunately, we have a recent example of the public valuing morality over a purely economical calculation: the recent budget debates. Over the past couple of weeks, federal Democratic and Republican leaders have been working to finish a budget deal before the August 2 deadline that would cause the US government to default on its financial obligations. If the deadline is not met, there will be an immediate loss in federal funding for social programs like Social Security, Medicare, and Medicaid. Even if a deal is made in time, those programs could still see budget cuts or qualification changes. Meanwhile, at the state level, New Jersey Gov. Chris Christie’s budget cuts to public education were so drastic that they were ruled unconstitutional. The public has been outraged at every aspect of these potential and actual cuts and changes. The argument: such cuts are immoral given that these are necessary programs that benefit children and the worst off — especially when there are other options, like taxes on corporations and the ultra-rich, or cutting, for example, the defense budget. 

No matter where you stand on these issues, you cannot deny there is a moral component to all of them. Take the issue of taxing the wealthy. Many urge for higher taxes on the rich because they think it is immoral for a small band of people to horde most of the nation’s wealth while the majority suffers. Others argue that the rich should not be deprived of the money they’ve earned (though it should be noted much of this money is inherited or made at the expense of the lower classes through practices put in place by the rich class). 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 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.