In a piece from the Prospect, MacIntyre weighs in on our current troubles and suggests that the issue goes right to the heart of the financial system we have constructed and upon which we depend.

There are skills, he argues, like being a good burglar, that are inimical to the virtues. Those engaged in finance—particularly money trading—are, in MacIntyre’s view, like good burglars. Teaching ethics to traders is as pointless as reading Aristotle to your dog. The better the trader, the more morally despicable.

MacIntyre’s work in virtue theory provides a vantage point for his analysis:

MacIntyre appeals to the classical golden mean: “The courageous human being,” he cites Aristotle as saying, “strikes a mean between rashness and cowardice… and if things go wrong she or he will be among those who lose out.” But skilful money-men, MacIntyre argues, want to transfer as much risk as possible to others without informing them of its nature. This leads to a failure to “distinguish adequately between rashness, cowardice and courage.” Successful money-men do not—and cannot—take into account the human victims of the collateral damage resulting from market crises. Hence the financial sector is in essence an environment of “bad character” despite the fact that it appears to many a benevolent engine of growth.

MacIntyre argues that debt has been used to resolve a fundamental problem of capitalism:

MacIntyre maintains, however, that the system must be understood in terms of its vices—in particular debt. The owners and managers of capital always want to keep wages and other costs as low as possible. “But, insofar as they succeed, they create a recurrent problem for themselves. For workers are also consumers and capitalism requires consumers with the purchasing power to buy its products. So there is tension between the need to keep wages low and the need to keep consumption high.” Capitalism has solved this dilemma, MacIntyre says, by bringing future consumption into the present by dramatic extensions of credit.

Such a solution is, of course, not sustainable for any real length of time. If MacIntyre is correct, then any long term fix will require a fundamental re-thinking of our financial practices. A tall order and one that may never happen unless (or until) those new dark ages MacIntyre famously warns about descend and force a new way of reckoning.

H/T Steven Rybicki

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Mark T. Mitchell
Mark T. Mitchell teaches political theory at Patrick Henry College in Purcellville, VA. He is the author Michael Polanyi: The Art of Knowing and The Politics of Gratitude: Scale, Place, and Community in a Global Age (Potomac Books, 2012). He is co-editor of another book titled, The Humane Vision of Wendell Berry. Currently he is writing a book on private property. In 2008-9, while on sabbatical at Princeton University, he and Jeremy Beer hatched a plan to start a website dedicated to political decentralism, economic localism, and cultural regionalism. A group of like-minded people quickly formed around these ideas, and in March 2009, FPR was launched. Although he was raised in Montana and still occasionally longs for the west, he lives in Virginia with his wife, three sons and one daughter where they are in the process of turning a few acres into a small farm. See books written by Mark Mitchell.

3 COMMENTS

  1. MacIntyre is absolutely correct we have moved into the era of financial capitalism. 40% of US GDP now comes from the financial industry.The greatest game is how to suck blood from the middle class by increasing their debt burden and for as many years into the future as possible. Financial vampire capitalism has produced the servile market state. Today the Irish government agreed to plunge the Irish people into years of debt servitude in order to prop up bankrupt Irish banks who got into trouble trying to impose this debt servitude by way of inflated property loans. The only way to begin ending this debt cannibalism by the blood sucking ruling elite is to remove their power to both create money and allocate :-

    http://www.positivemoney.org.uk/wp-content/uploads/2010/11/NEF-Southampton-Positive-Money-ICB-Submission.pdf?utm_source=Bank+of+England+Act&utm_campaign=8daeea3bd2-PM_Student_Conference_Nov_2010_10_12_2010&utm_medium=email

  2. This has been making the rounds, “Any sufficiently advanced financial instrument is indistinguishable from fraud.” I like it.

    This diagnosis makes sense in retrospect, but I’m not sure what it tells us going forward. Right now we are in an interdependent system where very many people are using financial obligations to expect behaviors from others. Even the rich are enslaved. Though they could extricate themselves with fewer consequences than the middle class as a whole, their wealth largely depends on the ownership of the promises of other people. If those people cannot or will not fulfill those promises, many apparently wealthy people will be shown as destitute.

    We are in a pickle, are we not? We all need each other to “keep playing along” lest all expectation fall in on itself. My job is dependent on my employer’s expectation of future consumption. If they believed that such consumption was to significantly fall in the future, my present position is at risk.

    I don’t see how there is any proper fix for this. Nothing but a slow, uncomfortable burn for many years with momentary relief from technological advancements in productivity. Eventually we will hit our new Malthusian set point.

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