2 Answers

How are you, Dougal? My my, this was a goody from back then, here we go............

https://www.opendemocracy.net/ourkingdom/kerry-anne-mendoza/is-there-such-thing-as-ethical-capitalism

What is Ethical?

First, we must decide how we approach this question: from a binary or a spectrum view of ethics. In binary views of ethics, to use a metaphor, you are either pregnant or not.  You can’t be half pregnant.  Therefore, the question has a yes or no answer.  However, using a spectrum view, there is a sliding scale ranging from the most heinous unethical extreme at one end, to the apex of moral good standing at the other.  In short, binary ethics asks ‘if’ something is ethical, spectrum ethics ‘how’ ethical it is. 

It is interesting that this question – 'is there such a thing as ethical capitalism?' – is asked in binary terms, yet often answered in spectrum.  Notice the question is not ‘what is the most ethical economic system?’ or ‘which economic model promotes the most ethical economy?’

Furthermore, the very question itself acts as a ring fence around the resulting debate, concentrating the imagination within the boundaries of just this one system – capitalism. The reason it is answered in spectrum might well be that the unethical behaviour associated with capitalism is so overwhelming and unignorable, that even the most ardent defence relies on relativity arguments – ‘given human nature’, ‘compared with communism’, ‘would you rather live here or North Korea?’.

Therefore I consider the question itself to be unethical.  It is either insincere or ignorant.  Insincere, in that it has been posed in response to plans for ‘ethical’ capitalism by Nick Clegg, David Cameron and Ed Miliband, with knotted brows and solemn voices, as if it were consistent with the conversation happening outside of the rarefied air of Whitehall.  It is not.  The conversation outside is around what an ethical society would look like, and what structures, economic included, would need to exist to support that.

If, however, the question is not insincere then it must be asked in ignorance of the myriad alternative economic models available and the broader social, economic, ecological and political questions being asked by individuals and movements, such as Occupy, UK Uncut and Climate Camp.

However, if people have themselves in knots over ethics, this is small beer compared to the state of our understanding of capitalism.

What is Capitalism?

Our understanding of capitalism is incredibly limited.  Despite this being the prevailing world economic system, it is not taught until University in the United Kingdom.  This means the vast majority of the population have never even had a structured, informed conversation around the mechanics and iterations of capitalism, let alone whether it is ethical or not.  People, on the whole, don’t know what it is, what it does, what it means, where it came from or what it replaced.

As a snapshot, capitalism is a socio-economic ideology, a theory and the current global economic paradigm.  It originated in the West, gained a foothold in the 1700s and 1800s and ultimately replaced feudalism. It has gone through various incarnations, or developments, from Mercantilism, Industrialism, Keynesianism, and the latest, Neo-Liberalism.  It exists in established democracies and totalitarian dictatorships. 

Yet I have had conversations on the topic of a world without capitalism with intelligent people who, without irony, have stated that capitalism has always existed and will always exist because people will always want to exchange things with each other. To be clear, you can have an economy without it being capitalist.  You can have trade of ideas, labour, skills and products without capitalism. Capitalism is not synonymous with any of these things. 

I mention this not to belittle, but to demonstrate how successfully and misleadingly capitalism has been branded as natural, inevitable, permanent and, arguably the most intriguing, ‘post-ideological’.  It is none of these things. But consider for a moment: if most people believe it is, then does it matter whether it is ethical at all?  If something is natural, inevitable, permanent and not based in ideology, isn’t even entering a conversation about the ethics of it somewhat irrelevant outside of the curiosities of academia? 

This is precisely how this conversation becomes pointless, for most, fast.  This is where the conversation slides into a rational black hole, we hang our heads and bemoan the cursed world and go back to watching the telly. This is how quickly and easily a question seemingly challenging of capitalism, leads inexorably to a conclusion in favour of the defence of the status quo.  The question itself acts as a kind of cerebral sat-nav guiding anyone who answers it without first analysing it, straight to the pre-set destination: turn right at the false dilemma, left at the pop psychology and come to a stop at the dead end.

This is why I have taken the time to set the question in some context before even attempting to address the material content of it.

A Matter of Context and Perspective

These matters of context and perspective are sadly missed in the current and painstakingly narrow debate conducted at sound bite level across the rolling news channels today. A large part of the thinking taking place at venues such as The Bank of Ideas, a building repossessed by Occupy London for the purpose of a Free University Campaign, is around placing questions of ethical economics in context and shifting perspectives from ‘western’ based to a more holistic view.

Be it economic stability, education, health, famine, poverty, security, the global commons, climate change, civil liberties, human rights, technological and scientific progress – any mode of economy needs to be consistent with social goals related to these elements.  Why?  Because if it is inconsistent, then you place individuals and organisations in a position of conflicting social and economic priorities.  Either they honour the social goals, the economic goals, or they search for some compromise – and there is often not a compromise to be found as the goals are diametrically opposed. 

For example, technological and scientific progress rely on the broadest population of educated, innovative, critical thinkers with access to means of contributing ideas, skills and capabilities to achieve breakthrough results.  Yet in order to safeguard the profit from any venture, it makes economic sense to have the smallest group of people involved as possible, operate secretively, and use patents and licenses to prevent others from ‘stealing your idea’ and making the profit from it that you yourself seek.  In order to progress more quickly, one would need to over-ride or compromise this economic imperative.