Results tagged “morality” from Eccentric Eclectica

My recent trawls around the internet have brought up some interesting finds that seem to cross ideological lines. A week ago David Brooks fired off a column linking the recent recession to a decline in America’s financial values. Brooks decries the growth of debt and consumption as a falling away from our previous virtues of hard work and thrift. I put on my very skeptical hat whenever I hear someone talking about decline from a previous golden age, but I think that Brooks may have something.

Our current cultural politics are organized by the obsolete culture war, which has put secular liberals on one side and religious conservatives on the other. But the slide in economic morality afflicted Red and Blue America equally.

If there is to be a movement to restore economic values, it will have to cut across the current taxonomies. Its goal will be to make the U.S. again a producer economy, not a consumer economy. It will champion a return to financial self-restraint, large and small.

It will have to take on what you might call the lobbyist ethos — the righteous conviction held by everybody from AARP to the agribusinesses that their groups are entitled to every possible appropriation, regardless of the larger public cost. It will have to take on the self-indulgent popular demand for low taxes and high spending.

A crusade for economic self-restraint would have to rearrange the current alliances and embrace policies like energy taxes and spending cuts that are now deemed politically impossible. But this sort of moral revival is what the country actually needs.

At the same time I’ve been following some of the depressing links David Pollard has been posting on environmental decline. Pollard and the people he links to approach the problem from a liberal perspective that is different from Brooks. Sharon Astyck starts off with a piece calling for us to dream up a new life for the future.

And other analyses are equally problematic.  It does not take a rocket scientist to figure out that radical lifestyle changes are coming, whether we like them or not - whether they come from adapting to a deeply damaged climate or from addressing the crisis, whether they come from adapting to depletion or from enduring it, our lifestyle will not be the same for very long.   And the danger of telling people that they can have all the things they want - a future for their children and an affluent present now - is that when they realize (and they are realizing right now) that this is not true, that there’s not enough money, or time or alternative energy to provide it, people will be very, very angry indeed.  It is not pleasant to tell people hard truths.  It is less pleasant to deal with people facing hard truths who believe they have been lied to.  I believe we are seeing the early stages of the political unrest that will accompany this sense of being lied to, of having lost more than is being accounted for on both the left or the right, and I also believe quite strongly that unless a true and comprehensible story is offered, false ones will be taken up, and used as bludgeons….

It is a counter-intuitive, and thus difficult thought,  that after a certain critical mass of affluence, better comes from less, not more.  A better future for our children comes not from greater affluence, but less, and the preservation of resources for the future.  A better life for us in the present involves fewer hours of work, and thus, more freedom - and fewer possessions and less affluence.

Astyck and Brooks are saying the same thing: we need to curb our baser impulses and live a thriftier life. One of them sees the problem as impending environmental doom the other as an economic and moral dissolution. Both of them reach the same conclusion that we need to rein in the profligate way of life we’ve become accustomed to during the past 40 years, especially in America. If there is any common ground between conservatives and liberals I think it will be built on this ground.

Back in March there was a brief media flurry over a libertarian rant by Rick Santelli. I was struck at the time by the persistently moral language used by the right to describe economics and capitalism. Making money has become a moral obligation for the right and a reflection of the moral worth of a person. If you’re poor then you are a moral failure, if you are rich then you are an angel.

The language of morality pervades the discussion of economics and may be a cause of so much of the regular debate about economic policies that occurs. Economic decisions, for all the pontificating about rational man, are always moral decisions as much as they are rational decisions.

I recently heard an acquaintance talking about the difficulty of knowing whether the recent economic stimulus is working. Not even the putative experts can agree about whether it is working. A scientific controversy, like global warming or dark matter, is much easier to adjudicate because the moral dimension is reduced or non-existent.

At the New Republic Jonathan Chait reviewed two books on Ayn Rand and found her writings to be a major source for the moralistic tone of right-wing capitalists.

In these disparate comments we can see the outlines of a coherent view of society. It expresses its opposition to redistribution not in practical terms—that taking from the rich harms the economy—but in moral absolutes, that taking from the rich is wrong. It likewise glorifies selfishness as a virtue. It denies any basis, other than raw force, for using government to reduce economic inequality. It holds people completely responsible for their own success or failure, and thus concludes that when government helps the disadvantaged, it consequently punishes virtue and rewards sloth. And it indulges the hopeful prospect that the rich will revolt against their ill treatment by going on strike, simultaneously punishing the inferiors who have exploited them while teaching them the folly of their ways.

There is another way to describe this conservative idea. It is the ideology of Ayn Rand. Some, though not all, of the conservatives protesting against redistribution and conferring the highest moral prestige upon material success explicitly identify themselves as acolytes of Rand. (As Santelli later explained, “I know this may not sound very humanitarian, but at the end of the day I’m an Ayn Rand-er.”) Rand is everywhere in this right-wing mood. Her novels are enjoying a huge boost in sales. Popular conservative talk show hosts such as Rush Limbaugh and Glenn Beck have touted her vision as a prophetic analysis of the present crisis…..

Rand’s most enduring accomplishment was to infuse laissez-faire economics with the sort of moralistic passion that had once been found only on the left. Prior to Rand’s time, two theories undergirded economic conservatism. The first was Social Darwinism, the notion that the advancement of the human race, like other natural species, relied on the propagation of successful traits from one generation to the next, and that the free market served as the equivalent of natural selection, in which government interference would retard progress. The second was neoclassical economics, which, in its most simplistic form, described the marketplace as a perfectly self-correcting
instrument. These two theories had in common a practical quality. They described a laissez-faire system that worked to the benefit of all, and warned that intervention would bring harmful consequences. But Rand, by contrast, argued for laissez-faire capitalism as an ethical system. She did believe that the rich pulled forward society for the benefit of one and all, but beyond that, she portrayed the act of taxing the rich to aid the poor as a moral offense.

Countless conservatives and libertarians have adopted this premise as an ideological foundation for the promotion of their own interests. They may believe the consequentialist arguments against redistribution—that Bill Clinton’s move to render the tax code slightly more progressive would induce economic calamity, or that George W. Bush’s making the tax code somewhat less progressive would usher in a boom; but the utter failure of those predictions to come to pass provoked no re-thinking whatever on the economic right. For it harbored a deeper belief in the immorality of redistribution, a righteous sense that the federal tax code and budget represent a form of organized looting aimed at society’s most virtuous—and this sense, which remains unshakeable, was owed in good measure to Ayn Rand.

I started a series on language and money last spring which I should return to. Once you start listening you realize that all of our talk about money is filled with moral judgments. My first post of the series talked about the difference between borrowing and leveraging, two terms for the same action but one used by the poor and the other by the rich. Some other terms that need pondering: angel investor, consume/invest, save/debt. Accounting also has a rich vocabulary for examination: asset, liability, appreciation, depreciation, balance sheet, double-entry, etc.

Listen to the way rich people and poor people describe the same thing and you will start to understand some of the divides in this country. The financial apocalypse has brought different ways of speaking to the forefront of our media and our attention.

There are many examples of linguistic difference between rich and poor. For example consider the way we use the words “leverage” and “borrow.” Let’s go the dictionary first to read the definitions.

Borrow: to take or obtain with the promise to return the same or an equivalent: Our neighbor borrowed my lawn mower.

Leverage: the use of a small initial investment, credit, or borrowed funds to gain a very high return in relation to one’s investment, to control a much larger investment, or to reduce one’s own liability for any loss.

To find out how the word is used I looked up both using ProQuest Newstand. I limited the results to the Star Tribune newspaper over the last 30 days.

I got 9 results for leverage. Here are two examples related to money.

1. “In an interview Monday, Cooper said the demands of TARP began to conflict with the government’s own policies. For instance, the federal government was pressuring banks to use the funds as leverage to make more loans and to buy other banks. But such moves would reduce a bank’s tangible common equity, which has become a major focus of bank regulators and is considered a key measure of bank health.” — Star Tribune March 3, p. D1
2. “Investment banks “raced like lemmings over the cliff by abandoning the usual principles of sound risk management both by increasing their leverage dramatically after 2004 and abandoning diversification in pursuit of obsessive focus on high-profit securitizations.” — Star Tribune, March 17 p. D1

Notice the actors in these reports are banks, not people. Banks leverage, people don’t.

Next I looked up borrow in the same paper and same time frame. Again there were 9 results. Here are three money related examples.

1. “We help (customers) get on a plan for their financial success in order to buy (insurance and investments) through Thrivent in the future,” she said. Harvey’s top idea for employed folks without emergency savings: Open up a line of credit just in case. “It’s always easier to borrow money when you don’t need it. When you’re unemployed, there’s not a loan out there for you,” she said. — Star Tribune, March 15, pD3
2. Toby Madden, a regional economist with the Federal Reserve Bank in Minneapolis, said the seeds of the rising default rate were sown earlier in the decade when credit eased so people could borrow more. — Star Tribune, March 8, p D1
3. Last week, Gov. Tim Pawlenty tossed another $27 million on the table in his bid to boost K-12 spending about 2 percent in 2010-11, even in the face of a steep, recession-driven revenue slide. He’s willing to gamble with the state’s credit rating and borrow against future state revenues to do it. He said he’s also willing to up his K-12 ante another 2.8 percent in 2012-13, while freezing every other item in the state budget at his recommended 2010 level. — Star Tribune, Mach 22, p OP-1

Individuals and governments borrow, not banks.

Leverage connotes power and movement. The dictionary defines leverage as “power or ability to act or to influence people, events, decisions, etc.” before it mentions money. Borrowing is a sign of weakness, a lack that needs to be filled, which creates an obligation to repay. Borrowers repay their loans. What do leveragers do?

People and governments borrow, which puts all of us at risk. Think about the national debt discussion. I haven’t heard anyone tell us that we need to leverage our wonder-working American economy in order to save our asses from disaster. Instead the fiscal scolds tell us not to “borrow from our kids.” Strange that these people didn’t seem to have any complaints about leveraging the financial power of Wall Street.

Wall Street gets the linguistic benefit while people and government get the linguistic punishment. Haven’t we heard this tune before?