As part of an invited lecture series, I led several seminars on the topic The Best Arguments against Free-market Capitalism. The format is Socratic and the participants are professors at my host, Francisco Marroquín University.
In this second seminar, we take up the arguments that:
a) We live in a world of scarce resources, and
b) Humans are too immoral for freedom (at 23 minutes).
Forthcoming: Three more arguments against free-market capitalism.
Related:
This seminar at UFM’s site.
I. Entrepreneurial Ethics.
II. Philosophy and the Evolution of the Mixed Economy.
III. Socratic seminars on the Best Arguments against Free-Market Capitalism:
1. “Capitalism is dog-eat-dog.”
2. “We live in a world of scarce resources.”
3. “Humans are too depraved for freedom” (at 23 minutes).
4. “Humans are too incompetent for freedom.”
5. “Wealth is a social creation” (at 11 minutes).
6. “Value is not of this world” (at 32 minutes).
IV. Interview: Business Ethics and Corporate Social Responsibility.
I actually buy the “scarce resources” argument and I’m disappointed that it’s not more well accepted by the business community. No resource is infinite, yet, we often tend to treat them as if they were. The business community seems to constantly fight against the whole notion of scarcity, which is especially odd since every price model, elasticity of demand model, and production model there is has scarcity as a foundation. To me, we should not deny the scarcity of resources. What we SHOULD do is to realize that no economic system aside from pure laissez faire capitalism has the capacity to self-regulate the use of resources or to provide the tools to quantify resource scarcity so that it can be managed. Government regulation ruins the self-regulatory mechanism in two ways. (1) It artificially modifies the measurement tools inherently contained in a laissez faire capitalist system. (2) It promotes “crony capitalism” by permitting industries to lobby for regulations that benefit them personally but unbalance the system.
It is point #2 that affects the ethical / moral argument. When a tool exists that permits a man to alter the system of labor and capital allocation, in his favor, irrespective of the impact on the competitive environment, ecological environment, and social structure, the guys who will most quickly take advantage of that tool are the guys with the weakest ethical foundation. The “tool” is regulation. When we regulate markets, we INCREASE the amount of unethical behavior by providing more ways to act unethically.
The ability for businessmen to negotiate with government over regulations is one of the primary tools of unethical business behavior. So regulation makes business less ethical rather than more ethical. THAT is the reason that, despite the vast political chasm between Tea Partiers and Occupiers, both agree that we need to rid ourselves of “Crony Capitalism”. It is THAT which is supported by excessive politically negotiable regulation and THAT which makes self regulation of scare resources impossible.