Is the market moral or capitalist?

Jerry Z. Muller, Professor of history, Catholic University of America, Washington, DC, Project Syndicate

Clemenceau once said that war is too important to be left to the generals. By the same token, morality is too important to be left to philosophers, especially where the morality of markets is concerned. Those who see themselves as the protectors of morality are more likely to be antipathetic to markets, whereas those who favor them typically talk about production, distribution, and material wealth -- anything but morality.

The market's positive moral features, however, are many. Consider one identified by Adam Smith, namely the link between individual autonomy and self-support through legally free labor. "It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest," Smith wrote. "Nobody but a beggar chooses to depend chiefly upon the benevolence of his fellow citizens."

This passage is a famous statement of the utility of self- interest. But notice its assertion that dependence on others is morally degrading. Thomas Carlyle, and later Marx and Engels, would decry this appeal to self-interest and the related rise of the "cash nexus" as either a dangerous assault on tradition or a source of human self-alienation.

At the least, there is the danger that the cash nexus can encourage a mindless commitment to work, and the belief that one's worth comes only from paid labor, leading to fear of dependence on others, or to shunning vital but unpaid activity.

But the flip side of the cash nexus is the freedom and self- determination that comes from overturning customary social relations such as slavery and serfdom, which totally subordinated the individual to the will of a master. Nor does the cash nexus subordinate the individual to the will of the state.

This independence was at the core of Hegel's insistence that supporting oneself by earning a living is one of the key ways that we gain a sense of ourselves as individuals.

Moreover, market relations stimulate honesty as a virtue. Merchants who seek to build their business on a strong base of regular customers are unlikely to engage in fraud. Companies that want to attract and retain investors strive for financial transparency.

Perhaps most importantly, market relations contribute to international peace by creating ever-wider forms of association. As Smith emphasized, when commerce links us to foreign peoples, we come to regard them not as barbarians but as potential suppliers and customers. In other words, capitalism creates a rational awareness of their needs and interests.

Similarly, markets are a powerful solvent of religious and communal antagonism, by creating incentives to cooperate with those whose identity and ultimate commitments differ from our own. Having just passed through the bloodiest century in human history, increasing the zone of indifference to the ultimate goals of others -- as long as they are not directed against us -- should be mankind's top priority.

But self-interested indifference does not mean a lack of mutual concern. Self-interest is linked to mutual concern every time a sales clerk asks, "Can I help you?" That phrase is often derided as phony and manipulative -- except by those who have lived in societies where sales clerks ignore customers.

The sales clerk's commercially motivated solicitude does lack true charity and altruism. But, seen historically, the market's ability to create a self-interested regard for others is surely preferable to the alternatives.

Of course, self-interested solicitude can lead to inauthenticity, to a sense of always selling oneself -- or rather, a sense of having to become someone who can be sold. This is a consistent theme of modern social criticism, from Rousseau through Death of a Salesman and beyond. The constant creation of new needs -- when not bounded by a sense of how novelty fits into our lives -- may put us on a treadmill of joyless consumption.

But capitalism also creates newer and more complex forms of individuality than before. In previous societies, one's status as a peasant, artisan, or merchant often defined one totally. Being a member of a guild, for example, encompassed a complete set of social roles -- economic, legal, political, and even religious. Modern market society, by contrast, is based upon looser, more temporary associations, founded to pursue specific economic, cultural, or political interests.

Such associations demand only a small part of the individual's resources, sometimes only a token monetary contribution. As a result, the modern individual can belong to a greater range of groups, but groups that are less all encompassing. Modern associations allow for participation without absorption. I am a husband and father, a Buddhist, a jazz aficionado, a molecular biologist, a marksman, and a reader of modernist fiction. What is historically new -- emerging just in the last few hundred years -- is the possibility of being all of these things at once.

This choice of possibilities is due in no small part to the market, and the peril we face is that so much choice can create a protean self, lacking binding commitments to anyone or anything, a self for whom the bottom line of every social contract is the escape clause.

But awareness of this danger should not lead us to lose sight of a fundamental fact: Many of the moral advantages and conceptions of selfhood that those in capitalist societies take for granted are due in no small part to capitalism itself.