THE MARKET AS INSTITUTIONALIZATION OF IRRESPONSIBILITY (Part 1)

“Wealth is the great source of moral improvement”, said Nassau

Senior, the first professor of political economy in the history of Oxford,
in its inaugural class. Surprising or not, the vision of Senior continues
in the current thinking. Typical is the moral justification of capitalism
offered by an editorialist for The Economist in February 1994 stating
that “capitalism is a kind of freedom. You give them to persons certain
rights (like the right to property and the right to sell their own work)
and then you leave them on their own, and you have capitalism.
Capitalism is a good thing, especially because freedom is a good
thing”. (1)

So categorical statements lead us to ask: is it true that the alone free

market leads us to moral improvement? That is, when we are free, are
we also responsible?

To answer these questions it is first necessary understand how it works the market dynamic. The market system
is presented primarily as one in which buyers and sellers come together in order to buy and/or sell goods and
services. Each one is responsible only for himself and exerts his personal interest buying or selling. Each
individual acts rationally (in economic theory, selfishly) making decisions at the margin, that is, without
considering the full consequences of their actions, but only if the buy or sell one more unit will bring him an
additional benefit.

The buyer is basically a “bargains hunter”. He doesn’t worry about the origin of the goods or the circumstances
under which they were made because the only thing that interests him is making the best investment of his
money according to his tastes and preferences. In this sense it would be “irrational” that he pay an extra price
just because the seller is poor, that he rejects an extraordinary discount just because he suspects that a product is
too cheap because those who make them work in subhuman conditions or that he buy domestic goods when
imported are cheaper for the sole purpose of not worsening the Balance of Payments of his country.

In turn, the seller is a “hunter of buyers”. He does not worry about the quality or suitability of his product more
than in so far as that it may affect his future sales, undermine his competitiveness or cause him to be punished
by law. He has to make them believe to potential buyers that they need his product even if this be not so because
the only thing he cares about is to get the maximum profit from his sale.

This is the reason why it has become so important advertising, being that what was previously known as
“exaggerated advertising” is now the very subject of advertising. On account of the Internet, television and other
means of communication billions of children, youth and adults are daily witnesses to the excessive enthusiasm
with which selected men and women promote perfumes, clothes, phones, cars, etc. But, this kind of behavior:
transmits a moral message? Does it show individuals who, acting like “real” people, who talk with conviction of
things that they really believe?

St. Thomas Aquinas, the great doctor of the Catholic Church, had dealt with this problem by asking whether it is
permissible to sell an object by an amount that exceeds its value. This question takes us by surprise. What does
mean “sell a product by an amount that exceeds its value”? Is not worth what the buyer pays for it? Is not that
the “just Price”? For St. Thomas Aquinas is not. He cites the Gospel of Matthew: “All things whatsoever ye
would that other do to you, do ye even so to them” (2). Now, nobody wants to sell him something for an amount
that exceeds its value, therefore whoever do the same with another person is committing sin.
The affirmation leaves us confused. Why? Because one of the functions of the market is to allow us to forget the
moral teachings that guide us in our relationships outside the market. In large part the markets are efficient
because they remove from our mind all those considerations problematic.

References:

1. Quoted by: Bas de Gaay Fortman and Berma Klein Goldewijk, God and things, Sal Terrae Press, 1999, pp. 33-34.
2. Matthew 7:12