Oh don´t be so bloody stupid

In a speech at St Paul\’s Cathedral, the Prime Minister drew on religious doctrine in a highly-personal address which warned that "markets need morals".

No they damn well don´t. Markets are amoral, that´s their very joy.

It might be true that the people interacting through the mechanism of a market need morals: but then there´s nothing very special or exclusive about markets in that respect either.

Think what a market with morals would be like. Is adultery immoral? Some certainly think so. So should we thus bar adulterers from shopping for their food?

See? It´s ludicrous.


7 thoughts on “Oh don´t be so bloody stupid”

  1. Tim, I agree and understand with your point, only that I would add that markets do require morals in the minimal sense that they work best when people are honest and can be trusted. Trust is the key. And honouring promises is at the guts of what makes a market work.

    Just sayin’

  2. In line with what Johnathan says, markets work on trust, which politicians apparently don’t need.

  3. Although (I realize this isn’t quite the same thing)… Rothbard believed that you couldn’t advocate laissez-faire capitalism from a values-free perspective, whereas Mises believed that you could.

    More practically, starting from a property-rights perspective, you presumably feel that it is important for market-participants to honour the “Thou Shalt Not Steel” commandment? How inefficient would markets be (i.e. what would be the transaction costs) if people only honoured this because of rigorous enforcement rather than because of an acceptance that it is the right thing to do?

    And remember the stuff in Frank’s Passions Within Reason about the importance of trust, the purpose of blushing, the prisoner’s dilemma, etc. Arguably, markets were better able to bake a bigger cake rather than just slice up the cake when a gentleman’s word really was his bond.

    Markets exist within an institutional framework (e.g. protection of property). The most effective institutional framework will be one that best encourages the cooperative action of exchange. Exchange will be best encouraged if people have confidence that the transaction will be mutually beneficial (e.g. they won’t be ripped off). Laissez-faire capitalists believe that a minimal set of rules is the most effective and efficient framework, whereas interventionists believe that more complex and proscriptive rules can improve the outcomes. But only an anarchist believes in an absence of rules.

    Not that I imagine this is what Gordon meant. But I would question his comments in terms of the role of morality, rather than denying absolutely its relevance.

    He seems, for instance, to be condemning risk-taking as immoral. Risk-taking is not only moral, but essential. Without risk-taking, we would have no economic, scientific and cultural progress. Risk-takers should be respected and admired, SO LONG AS they do it at their own risk, rather than with a “trader’s put”. But as Gordon has such a cozy relationship with the City institutions, he’d rather muddy the water by mixing up bankers with entrepreneurs and condemning the lot, than admit that the people who he thought were a special case were just that, but in the opposite way to the way he thought (i.e. to be treated with special care, not special latitude).

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