On the market economy as the dominant force of ethics
by Iain M Banks
"Let me state here a personal conviction that appears, right now, to be profoundly unfashionable; which is that a planned economy can be more productive - and more morally desirable - than one left to market forces.
"The market is a good example of evolution in action; the try-everything-and-see-what- -works approach. This might provide a perfectly morally satisfactory resource-management system so long as there was absolutely no question of any sentient creature ever being treated purely as one of those resources. The market, for all its (profoundly inelegant) complexities, remains a crude and essentially blind system, and is - without the sort of drastic amendments liable to cripple the economic efficacy which is its greatest claimed asset - intrinsically incapable of distinguishing between simple non-use of matter resulting from processal superfluity and the acute, prolonged and wide-spread suffering of conscious beings.
"It is, arguably, in the elevation of this profoundly mechanistic (and in that sense perversely innocent) system to a position above all other moral, philosophical and political values and considerations that humankind displays most convincingly both its present intellectual [immaturity and] - through grossly pursued selfishness rather than the applied hatred of others - a kind of synthetic evil. "
Brilliant. This in a nutshell wraps up two concerns I've had forever. That we cannot fully rely on an ethical system which uses game theoretic precepts. And that there is an unhuman lack of values lurking underneath which shows itself as often represented by public goods problems. In all formal systems designed as games, there are both paradoxes and loopholes. And when such are used not as models but also as value systems, these paradoxes and loopholes become the unfair, unjust, mostly undesired not so special cases.
Do we in fact need to let go of game theoretic human -ocracies, and look instead to other methods? What are those, if not game theoretic? I don't know. Yet.
7 Comments on "On the market economy as the dominant force of ethics":
Great post, Carolyn! Although frankly, I would have thought that this was more obvious than perhaps it is. A basic precept of Game Theory is for each entity to attempt to maximize their gain. While this might fit a laissez-faire capitalist market system, it is hardly a good starting point for ethical value systems that can be applied to a collection of entities known as a society.
Unless the society is the 'entity', game theoretic based models can never result in the greater good that I presume would be a characteristic of a 'moral' value system.
I like Game Theory and have often been intrigued by its ability to highlight the problems with our value systems, often by pointing out that the roots of those undesirable outcomes are firmly planted in the axiom of maximizing individual gains.
Where it really gets interesting is where you focus on the loopholes ana paradoxes in the game theory to see how the entities will react. The post on cooperation is a prime example: skewing the rules to create a paradox such that the entity out to maximize their gain through 'rational' decisions, actually comes out behind. (The Ultimamtum Game is an even better example.)
I might even go so far as to suggest that the major difference between cooperators and defectors is that the cooperators consider the collective group as the entity, and thus maximize their gain from a different perspective.
Returning to Mr. Banks' quote, I think he is suggesting that market forces have a tendency to take this one step further - that it is not simply one entity maximizing against another entity, but in fact the thinking is that there is only one entity, and everything else is a potential resource (including the other players, if you will).
Given humanities mix of cooperators and defectors (and all the gradations in between), the implication might be that there are gradations of what are seen as other sentient beings (to be valued as fellow entities) and those which are simply regarded as resources (or not regarded at all, which ends up being the same thing). This lack of regard (or awareness) is why he considers it simple selfishness rather than applied hatred. But the outcome is the same - a kind of synthetic evil. You're right - brilliant.
One last point. His comment about the market's try-everything-and-see-what-works approach strikes me as a problem right there. If we are to have ethical value systems, based on some higher morality, then surely there are things that we should not try, simply because our value system instinctively tells us that they are not right. Perhaps we are ignoring an evolution that has already taken place.
Well, it's not really "try everything"; it's "try everything that's legal". We pass laws to prevent things we don't want. Of course we can't always foresee the consequences some activity might have. But when the alternative is that "anything that is not explicitly permitted is forbidden", the result is the sclerosis that all command economies have.
I think it's also important to consider that when a market economy interacts with a command economy, the command economy disappears - at least it would seem that way given what's been happening over the last few decades around the world. Even Albania, the purest communist state and highly isolated, ended up going to a market economy. It's all very well to talk about the ethics of economies, but I would put this twist on an old saying: "ethics are written by the winners".
I am not familiar with I. Banks work, I thoroughly agree with his comments on Markets though.
Capitalism is about profit and the efficient use of resources in production.
His comments do not take into account, the concept of democracy. Democracy, in an indirect way, forced the establishment of human rights.
The cause and effect goes something like this:
If every indiviudal has a right to vote than democracy is essentially saying that everyone has a say in how everyone should be governed. Once you have established that everyone has a say on how they are to be govern, than democracy is required to define an individual.
To ensure that everyone individual has the free will to decide how the government is run, you need to define a set of laws that protect the voice of the individual which leads to the basic fundamental human rights.
Human rights is basically the application of humanism in society.
Incidentally, has anyone taken a course in university on game theory. Can anyone recommend a good book on game theory?
YP -
You wrote about individuals as acquiring human rights in a democracy because they have the right to vote.
Hmmm..
There are many individuals - in every democracy to date - who do not have the right to vote. Here are examples from various democratic nations:
- children
- foreigners who live in the nation
- prisoners
- non-human lifeforms (am I pushing it here?)
So in what sense do individuals in these categories lack human rights? At a minimum they lack having full say in how they are treated.
Interesting post and discussion. I'm taking a class in ethics and public policy, and we've reviewed the basics of deontology and consequentialism (OK, OK, Kant and Mills - like I know what the heck I'm talking about!), and will be applying those to public policy issues.
But the prof. started the class asking if ethics should even have a role in making public policy - should, say, economics be the only guide...
I'm not sure we've fully explored this question yet, but will start getting into the meat of the question in tomorrow's class.
Some backlinks:
What is Game Theory?
Readings About Game Theory and Game Theory Book Reviews
Books and Textbooks for the Graduate Student
And the famous ones: The Evolution of Cooperation and The Complexity of Cooperation, both by Robert Axelrod, the father of game theory.
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