ChristianWeek

In what follows I shall argue that capitalism does foster the decline of virtue, mainly because of its faulty understanding of human nature and its limited vision of the good. However, I shall distinguish between capi-talism as an ideology of the market, and the market economy as a system for organizing our economic behaviour.

As described by Anthony Waterman in the first column of this series, the market economy is a way of organiz-ing the production and distribution of goods and services which is more efficient and more effective than any of the alternatives: producing everything ourselves, having the government or some other authority tell us what to produce and what we will receive for doing so, or taking what we want by violent force. Compared with these alternative systems, the market is not only more efficient, but also more likely to foster virtue. In this I agree with what I judge to be the main thrust of Anthony Waterman's argument.

However, whether any system, no matter how good it is, actually does foster virtue or not is dependent on the moral and ethical values that inhabit it or that govern the society using it. The economy is not and cannot be a value-free or morally neutral domain. In our case, western societies are dominated by the moral vision of capitalism.

Capitalism is not merely a description of an economic arrangement based on markets. Rather, it is a moral vision based explicitly on utilitarian philosophy, materialism and individualism. The mainstream economic theory at the heart of capitalism (sometimes referred to as "neoclassical economics") models the human person as a rational individual who constantly chooses between alternatives in order to maximise his or her own individual utility or happiness. The goal of capitalism is to provide freedom for individuals to do this across as wide a range of choices as possible. Do we really believe that encouraging and permitting individuals to pursue whatever they desire is the same thing as what any religion or philosophy might identify as virtuous?

This capitalist moral vision then legitimates a particular version of the market economy. Mainstream economists argue that more effective individual choice and more competitive markets will produce greater economic efficiency and faster economic growth. Since greater production is bound up with greater happiness for more and more people, any barrier to the expansion of choice must be removed. This is why economists often argue for the de-regulation of labour markets (to make it easy for firms to hire and fire people) and of capital markets (to make it easy for money to be divested and reinvested from place to place), as well as for "free trade" in goods and services.

In contrast with capitalism, the Bible supports individual freedom but does not idolize it. Rather, it teaches us that all people (not just Christians) are not autonomous individuals as much as they are persons made for social interaction and relationship with others.

In contrast to capitalism's tendency to constantly increase the scope of the market by "deregulating" any barriers to its expansion, Leviticus 25 for instance, puts explicit limits on the scope of the market in order to safeguard other goals. Community, care for the land and social inclusion are to be valued along with individual freedom. The Jubilee laws plus the bans on interest, permanent debt and slavery in these and related passages act to restrict the free movement of capital and the commoditization of land and labour. Such restrictions work to limit the socio-economic exclusion of those who might otherwise find themselves "capital-poor," and they do this without the need for government intervention or welfare handouts.

The same approach limits the need (not the potential) for labour mobility. High labour mobility in western societies, driven primarily by economic factors, is a major cause of family dislocation, the loss of community and the loss of connection with place. These in turn contribute to increased damage to creation. It is noteworthy that Adam Smith and the early classical economists also assumed a very minimal level of labour and capital mobility (their concept of free trade was free trade in goods and services, not free movements of capital).

Counting the net result

Capitalism fosters the decline of virtue because it elevates individual freedom above all other moral goals. Today, we consider it normal to choose a job, find a place to live, buy goods and services and invest our savings all with little if any regard to the impact these actions will have on our neighbours. Although none of us directly intends it, the net result of these actions tends to increase economic and social inequality and directly undermine even the possibility of genuine community-a loss which we then lament and which gives rise to all kinds of secondary effects and government policies for social welfare, environmental protection and "urban renewal."

The utilitarianism, materialism and individualism that animate capitalism to favour greater labour and capital mobility also urge the extension of markets into areas of life beyond those that obviously involve business and wealth creation. These have come to include education, health care, the legal system and even marriage, the church and the political system. We are under constant pressure to treat learning, care-giving, justice, sexuality and family life, church services and voting behaviour as consumer transactions. Such an attitude demeans and subverts the essence of these activities which by their nature should not be reduced to a matter of individual consumer choice.

Our political rhetoric usually portrays the choice facing our societies as one between increasing individual choice (and unavoidable inequality) on the one hand, or increasing governmental power to achieve greater equality (at the expense of freedom) on the other. Rather, the choice we have is to decide what areas of life the market should cover and what moral vision will inform that decision.

Capitalism is already a version of this choice-it embeds the view that the market should extend to every area of life and that the only moral vision that matters is maximization of the freedom of the individual to do whatever he or she wants. The more we pursue this direction, the more we will experience the negative con-sequences in terms of increased consumerism throughout all areas of life, rising social inequality and environmental degradation, and the more we will then "need" larger government to sort out these problems.

If we want smaller and more decentralized government-which I believe is what the Bible advocates because of its realism about the corruption of power-then we must limit the scope of the market in our societies and give room for goals other than individual choice so that virtue can genuinely be fostered.

Paul Williams is an Oxford-educated economist, director of DTZ plc-a multinational real estate consulting and investment banking group-and professor at Regent College in Vancouver. His research interests include globalization, capitalism and sustainable development, the role of religion in social and economic development and workplace spirituality.