This oft-asked question will be asked even oftener when Pope Francis visits the U.S. next week.
It’s one thing to conclude that markets are immoral after learning how markets work and what life would be like in their absence. Such a conclusion is intellectually defensible because it would reflect an informed – if, in my view, bizarre – value judgment.
But the conclusion that markets are immoral typically reflects – as it surely does in the case of Pope Francis – utter ignorance of the logic and history of markets (and of the logic and history of governments).
Markets are deeply moral, for they, compared to all feasible alternatives,
It’s one thing to conclude that markets are immoral after learning how markets work and what life would be like in their absence. Such a conclusion is intellectually defensible because it would reflect an informed – if, in my view, bizarre – value judgment.
But the conclusion that markets are immoral typically reflects – as it surely does in the case of Pope Francis – utter ignorance of the logic and history of markets (and of the logic and history of governments).
Markets are deeply moral, for they, compared to all feasible alternatives,
- are driven by voluntary choices rather than by diktats;
- concentrate the costs and the benefits of each choice as closely as possible on the individual who makes that choice;
- allow for great diversity of choices and life-styles;
- create mass flourishing; they raise the living standards of the poor far more than they raise the living standards of the rich;
- transform the manifestations of economic hardship from literal starvation to much-less severe financial distress; (losing a job or a home, however agonizing, is far better than losing your and your children’s lives);
- ‘churn’ over time the rich and poor; dynastic wealth, while not unknown in markets, is less common than unthinking and historically uninformed people suppose, and such wealth is always exposed to the forces of creative destruction;
- bring together literally hundreds of millions of strangers from around the globe and from many different cultures and religious faiths into a peaceful and cooperative productive effort.