Economics with an ethical dimension

With the onset of the Christmas period it is worth considering bu­siness and economic issues from an ethical perspective. I have often written about the need to subordinate the individual benefit to the common good and the need to understand that any decision related to economics or business has an ethical dimension.

What worries me in this regard is not immorality in economic decision-making but amorality, as the latter leaves a vacuum which can be very harmful to society.

And the claim that ethics do not have a place in economic, financial and business matters leads to this vacuum.

One element of this discussion is “an economy that excludes”.

There are still too many persons who believe that in an economic environment let the fittest thrive and survive. Such persons believe that excluding persons from the operation of the economy (such as the unemployed) does not amount to any wrongdoing.

What such persons are not appreciating is that wrongdoing does not happen only by committing a wrongful act but also by omitting to commit the rightful act. What we fail to do is just as harmful as what we actually do.

Over the years we have in fact built an economic model that excludes people in more ways than one. For example, people starve to death while food is thrown away to maintain commodity prices at a high level. The news of persons losing their jobs is given far less importance than the news of a drop in the value of a currency or in the value of stocks and shares.

By accepting that in an economy one must let the fittest thrive and survive, one is actually accepting the principle that the powerful feed on the powerless, which surely cannot be considered as being ethically acceptable.

New products that offer greater comfort and improve the quality of life are in themselves positive things. But the fact that those who are better off are excited by such new products and have no difficulty in purchasing them, while the have-nots are excluded from this exchange of goods, means that we are effectively excluding a significant segment of society from the operation of the economy.

We often speak of the stronger economic operators exploiting the weaker ones, which is certainly wrong. But what is happening nowadays is not exploitation but exclusion, which is an act of omission rather than an act of commission and as such seems less wrong.

We can use the example of the unemployed. We have stringent laws that safeguard the rights of employed persons, but we seem to have no laws that safeguard the rights of the unemployed.

It is as if they were excluded from the labour market, to the extent that many long-term unemployed become tempted not to continue searching for a job.

Such exclusion is bound to lead to a breakdown of the social fabric. These points were in fact analysed in the exhortation Evangelii Gaudium issued by Pope Francis recently.

One might rush to conclude that a market economy is inherently evil. In effect this is not so. The encyclical Centesimus Annus by Pope John Paul II made the point that a democratic state characterised by the rule of law and endowed with a market economy deserves praise.

This has been well described in a book called Papal Economics, written by Maciej Zieba.

However the market economy and the democratic environ-ment in which it operates must be subordinate to the culture of the common good and human dignity.

Otherwise man be­comes a tool rather than the protagonist in the operation of the economy.

To my mind the Christmas period is a good time to remind ourselves of these issues, which are fundamental when debating economic, business and financial matters. They may sound uncomfortable for some because we are required to look at such matters from a different perspective, especially if one is not part of the excluded group.

Maybe we do not recognise that such exclusion leads to a state of totalitarianism, be it of a political system or an economic system. And such a state of affairs is ethically wrong.

Lawrence Zammit

Latest News