Beyond anything experienced in nearly a century, the COVID-19 pandemic has affected thousands of lives, created big shifts in stock markets and has raised an overall uncertainty about what the future looks like and the cost of recovery that will come with it. With the majority of countries plunged into a crisis described as the worst reduction of global growth since the Great Depression, it is worth asking: How much government intervention is required in a capitalist economy system? What becomes of market forces when everyone is scrambling for goods? Are there ethical problems that arise directly from inherent problems in capitalism?
According to Dr. John Thrasher, assistant professor of philosophy and researcher in the Smith Institute for Political Economy and Philosophy “the response to the pandemic may yet have moved many governments somewhat closer to socialism than they were before.” Under lock-down, the authors assert, governments have embraced the strategy of paying people as compensation for their financial pandemic-induced losses.
“People often associate socialism with redistribution and/or the state paying for certain services. But this is misleadingly narrow. While socialist societies aim to move wealth around, a fair bit of this occurs in capitalist societies when governments pay for public goods, infrastructure, and the like. A distinctive feature of socialism is really that the government sets production targets for the economy and directs activities accordingly. This has historically caused great problems (like famines), and it would likely not help with the pandemic,” said Dr. Thrasher.
Thrasher’s call to recognize the reality of the ethical challenges of capitalism and how they can be confronted is captured in his new book, “The Ethics of Capitalism,” co-authored with Dan Halliday, senior lecturer in philosophy at the University of Melbourne. The book seeks to rethink the defense of capitalism as a moral improvement and argues that no society is a pure embodiment of capitalism as elements of feudalism and even socialism can be found within.
“One of the things we emphasize in the book is that there is a lot of diversity between capitalist societies, largely arising from the different histories of those countries. Capitalism in the USA is very different from capitalism in Germany, Sweden, or Australia even though we argue that all of these countries are recognizably capitalist. The point is that a concern for justice should play a role in how we judge and shape our institutions, even within a capitalist society,” said Thrasher.
“Sometimes the ethical problems we find in our capitalist societies are the result of vestiges of hierarchy and feudalism and sometimes they are problems that arise directly from inherent problems in capitalism,” said Thrasher. “It’s no use blaming capitalism for the remnants of feudal landholding or inherited privilege. Which doesn’t mean that there isn’t a problem, only that clearly identifying and then thinking through a solution will go beyond criticizing capitalism, which may preserve injustices that it did not cause and that are not directly related to it.”
Much of the debate on capitalism and ethics has been occupied with either contemporary research or old primary texts. The historical and political background, however, has not often been made a major aspect of consideration and discussion. With this influence, they employ an interdisciplinary approach in contending with good reason, popular concepts of capitalism and the need to fully understand how economic principles are fundamental in addressing issues of political philosophy.