The economics of good and evil

This brief post by Sophistpundit brings to mind the curious fact that morality and economics are fraternal twins, engendered in the same womb:  that place where trade-offs get worked out.  Adam Smith, who first articulated free-market capitalism in Wealth of Nations and invented moral psychology with The Theory of Moral Sentiments, has a claim to be the daddy of both endeavors, at least in their modern form.

Trade-offs in economics deal with resources.  Human needs are infinite, but the resources to satisfy them are finite.  Which needs should get the necessary resources?  Who decides?  And on what principle is the decision made?

History provides a limited range of answers to such questions.  Medieval society, for example, favored the needs of one class over those of all others.  Not surprisingly, medieval economies were tightly controlled by those in power, who dispensed resources according to a paternalistic principle of fairness.  Those in charge knew best.

Liberal democracy rises and falls by the principle that nobody understands the needs of an individual better than the individual himself.  Accordingly, the education of the individual becomes crucially important, as does the (more or less) untrammeled  exchange of resources between individuals – each making educated trade-offs on his own behalf.

All economic models are variations on these two principles:  top-down, or bottom-up.

Morality deals with the management of personal sacrifice.  Personal desires – what William James called our “claims on the world” – are infinite.  Yet even for the most powerful and arbitrary dictator, the possibility of cashing in on those desires is narrowly bounded in time and space.  We mostly don’t get what we want.  Morality consists of a set of instructions on how to manage the pain of our ever-frustrated cravings.

The passage of a human life is the sequential favoring of one desire at the expense of many others.  Morality oversees a great slaughter of hopes and wishes:  the tragic aspect of social existence.

A foundational domain of moral decision calls for trade-offs between the present and the future.  I may desire an education (to increase my ability to satisfy future desires) and a life of partying (to indulge present desires).  To achieve the former I must sacrifice the latter:  that is, I must assume control over the powerful impulses stimulated by my immediate surroundings.

“Decreasing impulsivity” was a motto at my children’s elementary school.  Aesop’s fable of the grasshopper and the ant dealt with the same theme.  Yet this is no childish matter; it’s the solid ground on which all moral behaviors are built.  Murderous criminals labeled “psychopaths,” writes Marc Hauser, are identified in part by their total inability to resist destructive impulses.

The most common – and troublesome – domain of moral decision pits one’s desires against those of other people.  Family and friends are included among the latter, but also strangers who happen to be members of one’s moral community.  The questions which agitate this domain often sound like a dreary family fight:  Why should I care about you?  Why should I give up my dream for yours?  How come your beliefs override mine?  What stops me from doing what I want, so long as I don’t get caught?

The answers to such questions are given, not reasoned.  Every community culls its moral traditions from the three-way collision of its history, environment, and predilections.  The process is evolutionary:  unsuccessful traditions wither away, and are heard no more.  Moral trade-offs between the individual and the rest of the community, therefore, are never a question of which morality best suits one’s tastes but of how one can best adjust to the morality one has inherited.

The almost certain alternative is moral failure.  Let the contemptible life of Norman Mailer stand for the consequences of self-invented moralities – or, on a more catastrophic scale, the killing fields of the Khmer Rouge in Cambodia.

Moral adulthood entails understanding the trade-offs at the heart of every tradition, the losses incurred by even the greatest good.  I may abolish all pollution tomorrow, but at the cost of pauperizing much of the human race.  I may mandate free health care for everyone, but at the cost of reduced investment in new medicines, and thus of future lives.  To appeal to absolutes is simply to ignore the tragic side of the equation.

Absolutists used to be churchmen, grand inquisitors.  Today they are rationalists armed with formulas and prescriptions.  They tend to be very brainy people, but moral juveniles, trampling blindly on the trade-offs worked out, in pain and conflict, by the community, while seeking to impose clever solutions to what – they believe – are merely intellectual problems.

The rationalists denies the need for trade-offs.  He rejects the tragic view of human life which makes morality necessary – and thus, fundamentally, he rejects morality itself.  Social life, to him, is a series of problems asking for solutions.  Trade-offs and tragedies exist because stupid people have imposed wrong-headed solutions to problems such as job creation, environmental pollution, crime, sexual relations, and reproduction.

So we come a full circle, back to our two economic models:  top-down, and bottom-up.  While there’s no such thing as a moral “model,” a similar divide appears among individual outlooks.  Some – and I include myself in the number – believe that morality is evolved, and thus both given by the community and shared equally by all adults.

Others maintain that if there is such a thing as morality, it must be reasoned, formulaic, and imposed from above – a gift from those who are brainier and know best to those of us who have clung, rather pathetically, to the tatters of our traditions and superstitions.

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