Economics and ethics are intertwined: Professor Jay

TEHRAN, March 13 (MNA) - Professor Martin Jay says, “From the very beginning of human culture, it is likely that economic activities and ethical concerns were inextricably intertwined.” Jay, a professor of history at the University of California, made the remarks in an interview with the Mehr News Agency. Following is the text of the interview: Q: What are the roots of ethics in economics? A: From the very beginning of human culture, it is likely that economic activities and ethical concerns were inextricably intertwined. How to allocate fairly the tasks that allow humans to survive in a world of scarce resources, how to divide the results of their labor, how to care for the weaker members of the community unable to work for themselves (the young, the old, and the infirm)—all of these involved posing questions that we would now call ethical. Even when societies distinguished between sacred and the profane realms, the values of the former could influence the activities of the latter, as shown, for example, by the religious prohibition on usury for much of the Christian Middle Ages. When modern economic theory emerged in l8th-century Europe, as Emma Rothschild argued in her celebrated study of “Economic Sentiments: Adam Smith, Condorcet and the Enlightenment”, a radical differentiation of moral sentiment from economic behavior had not yet developed. It was only in the following century, during the heyday of classical liberalism, that the economy seemed to become an autonomous realm of its own with little regard for traditional ethical constraints on expanding productivity and maximizing profits. With the spread of the capitalist mode of production, it seemed possible to identify economic laws, such as supply and demand, as if they were isolated from any moral context. Still, even then vigorous resistance to the exploitative effects of market relations and differentials in wealth on the part of its victims was often expressed in ethical terms. And of course the struggle against the even more blatant exploitation of slave labor, which, alas, is still a reality in our own day, has always been carried out largely in humanitarian terms. It should also be noted that exponents of various economic systems—liberal, corporatist or socialist—will often defend them as inherently more ethical than other systems. Liberalism mobilizes the rhetoric of individual self-reliance, corporatism, that of community solidarity, and socialism, that of equality and economic justice. Although the others often denounce such rhetoric as an ideological mask for actual exploitation, the fact that it is employed at all shows that economics and ethics remain very hard to separate. Q: Recently, some scholars like Prof. Amartya Sen and Prof. Hilary Putnam insist on ethics in economics. Does this emphasis mean the failure of free market economy that is based on liberalism? A: Even during the ascendency of classical liberalism, there were ethical challenges to unchecked laissez-faire economics launched by cultural critics like Thomas Carlyle or John Ruskin. The former railed against the growing power of the “cash nexus” as the replacement for real community and the latter complained that "our true monarch is not Victoria but Victor Mammon.” There were both left and right-wing critiques of the hegemony of the market, the exploitation of wage labor, and the destruction of traditional values of social solidarity. Defenders of unregulated capitalism have responded by saying that individual freedom and entrepreneurial creativity were stifled by subordinating the logic of economic profit-maximization to traditional constraints, and therefore the liberation of the modern self was contingent on the growth of the “free market.” They worry that attempts to rein it in by the state lead to coercive controls from above that threaten to undermine other freedoms as well. Thus both the critique of the market economy and its defense have been couched in ethical terms, as well as drawing on claims about the comparative creation of wealth and the justice of its distribution produced by different systems. In other words, it is a mistake to make a simplistic contrast between ethics on the one hand and market economics on the other. The real challenge is to clarify the ethical implications of each system, weigh the merits of one against another, and come to some balance that will allow the best ethical outcomes of each to be realized. Perhaps this goal is utopian and there are inevitable ethical conflicts that make it impossible to find the right balance, and we must choose what our priorities are—say, justice over liberty, or abundance over equality—but in any case, we need to be sensitive to the costs of whatever path we choose. Martin Jay is the Sidney Hellman Ehrman Professor of History at the University of California, Berkeley. He is a renowned intellectual historian and his research interests have been groundbreaking in connecting history with other academic and intellectual activities, such as the Critical Theory of the Frankfurt School, other figures and methods in continental social theory, cultural criticism, and historiography among many others. (By Javad Heirannia)