Are our morals compatible with the economy?

Written by Max Edin

The current financial crisis has highlighted an interesting disparity between our morals and the necessity of continuous economic growth. In a world where resources are finite, continued economic growth can only be a possibility if we choose to ignore our morals.

In the last ten years our society has started imposing ever stronger morals onto itself. Organic foods, environmental friendliness and CSR-policies have become buzzwords and few companies can thrive in todays world without abiding to these societal pressures. We are, however, living in an illusion where we think we live by this moral code, yet it is not actually applied. Many companies knowingly outsource to countries where questionable business practices are the norm in order to chase an ever-elusive economic growth; yet they still present themselves as having an ethical code of conduct. How should we view the sustainability policies of such companies? If they truly stood by them, why would they knowingly take actions that go against these policies?

We appear to have reached some kind of a pivotal point with the current financial crisis where our morals have clashed directly with the reality in which we live. The bailouts that have happened in recent years have been presented as going towards failed state economies (in the case of Europe). But by bailing out the failed state economies of Europe we have indirectly bailed out the banks of Europe. By using taxpayer money, which historically is meant to be used by the state for its citizens, to uphold this fantasy of continuos growth they have essentially failed the main reason for the existence of states. By bailing out the banks and financial institutions the risk of economic collapse has been outsourced from those wanting to take it (Corporations) to those who are naturally risk averse (Nation states; citizens). It is no longer a risk that the banks will default, now we’re facing the problem of entire nations defaulting. These decisions were made under the pretext of our morals, by bailing out the banks we were told that we could keep our well-being and continue on enjoying our current lifestyle; albeit by sacrificing some short-term well-being. What has ended up happening, though, is many people have been forced to sacrificed both their short-term and long-term well-being so that corporations can keep their profits and growth. This is quite evident from the dramatic increase in unemployment and the fact that many corporations are still healthily profitable.

We have successfully upheld the faltering illusion of compatibility between continued economic growth and our own morals by covering the realized losses of this incompatible equation with both future debt taken on by tax-payers and by the immediate mass unemployment of workers.

The real solution to our problem could perhaps be found by looking at our current predicament from a different perspective. Rather than the polarized choice of choosing to either bail out the failed economies or face total economic collapse we should rephrase to question to one of choosing between either profit or morals.

By freely admitting that our morals are not compatible with continued growth we open up far more choices of possible resolution. We could, for example, accept that profit is not the highest achievable goal and adopt stricter legislation that improves well-being at the cost of growth. Such as import duties on products made in countries with poor environmental legislation or questionable business practices.

Or we could face the realization that our lifestyle is incompatible with our morals and requires someone to suffer. We could then de-regulate the markets and remove barriers to profit and growth such as fair work legislation and protectionist import duties.

Two facts are clear, one; the current solutions to this crisis does not fix the underlying problem, and two; in order to find some-kind of a balanced solution we need to answer the following question, is it morally defensible to strive for profit at the expense of well-being? If the answer to this question is no, then isn’t there a need to change how our society is organized?

Source: Medium