Harvard professor Michael Sandel examines ‘moral limits of markets’ in new book
Michael Sandel, the superstar Harvard moral philosopher, wants people to spend more time queuing. Well, he wants people not to spend money to avoid queuing, which amounts to the same thing. Except sometimes the money option is ethical. When a bus arrives at the stop, it should be first come, first served; but he agrees I should not be under an obligation to sell my house to the first buyer who arrives at the doorstep.
“There’s no reason to assume that any single principle – queuing or paying – should determine the allocation of goods,” he writes. In which case, practical moral philosophy needs to indicate which principle applies in which circumstances. Professor Sandel does not give an answer, although he is very clear that the market principle applies in far too many cases, and many readers will agree wholeheartedly.
Perhaps we can figure it out from his examples. He objects to some people being able to buy the right to board airlines faster than others; or to pay for better service from a call centre; to paying someone else to stand in a queue on your behalf; to reselling concert tickets at a higher price. He thinks children should not be paid for attaining good grades at school.
This entertaining and provocative book is full of examples of vulgar commercialisation, including US towns that have sold advertising space on police patrol cars, the Washington lobbyists who pay homeless people to queue to see a congressman, the sale of a forehead as advertising space, and the purchase of naming rights to New York subway stations by (among others) Barclays Bank. A lot of us will agree that there is far too much of this in modern life.
However, there are examples in this book of the expansion of markets in ways that many people, especially economists, would mostly regard as beneficial, but the author argues are degrading. Life insurance is one. Sandel describes it as a “wager on death”. He shares, it seems, the opposition of religious authorities to life insurance before it became increasingly widespread from the mid-19th century.
There are certainly some commercial excesses in the life insurance market. These include so-called “dead peasants insurance”, whereby corporations take out policies on the life of their employees, originally without their consent; and the investment index of “viatical” insurance policies, whereby the investor buys at a discount the insurance policies of people who are dying and trades them. Yet to put normal life insurance policies in the same category, even though they may create a theoretical incentive to murder, seems extreme.
Sandel is particularly opposed to the idea, attributed to economics, that all human relations are market relations. His opposition to market relations stems not from an argument about fairness (that rich people can afford more), or about blackmail (poor people are effectively forced to make unpalatable choices because they need the money). Instead, his argument is that introducing market choices into domains where civic values ought to prevail has a degrading and corrosive effect.
The fact that a market might lead to outcomes that improve welfare is irrelevant to the over-riding importance of civic virtue, he argues. Thus a global scheme for a market in carbon dioxide is morally unacceptable, even if it reduces the level of emissions, because it does damage “to two norms: it entrenches an instrumental attitude toward nature; and it undermines the spirit of shared sacrifice that may be necessary to create a global environmental ethic.”
I would rather see an effective scheme to reduce greenhouse gas emissions, but then I’m an economist. Economics is firmly grounded in utilitarian ethics, which can conflict with Sandel’smoral principle of virtue for its own sake. So at some point he and an economist are bound to part ways in making ethical judgments.
However, he thinks economists are more ideological than is the case (for the most part). For example, the book cites a well-known example of the use of a financial incentive proving counter-productive: a nursery that introduced a fine for parents who picked up their child late found that it increased lateness. Similarly, offering pupils payments to improve their grades does not always have the desired result.
A jobbing economist is not philosophically challenged by evidence that a financial incentive does not work, however. She will try to redesign the scheme with incentives that do work. The field of economics known as market design offers examples of market incentives whose outcomes are both effective and (I think) moral. A kidney-matching market created by economists in New England in 2004 has dramatically increased the number of kidney transplants, a result that surely outweighs any counter-argument against the commodification of body parts.
Economics does not deny the existence of limits to markets, or what are known as “repugnant” markets. On the contrary, market design tries to identify which reasons can account for the, often instinctive, moral repugnance in a specific case, and work around it. The good professor’s insistence on a domain of civic values is certainly one principle for ruling out or limiting markets, and this explains why justice is supposed to be beyond purchase, and votes too, and why states insist on providing education for their citizens.
However, the generally accepted boundaries on markets vary, and the tide can flow both ways. There used to be a large market in humans, now banned in international law. The US prohibited the alcohol market in the 1920s. Short-selling of shares has sometimes been banned, sometimes not.
What Money Can’t Buy will tap into a widespread unease about having to limit government and accept a larger private domain in this age of austerity; and about crass commercialisation when unemployment and inequality are too high. But it does not offer a clear guide to which markets are repugnant, and why.
We might agree that the new markets in financial indices of agricultural commodity prices, created by Goldman Sachs and others, are intolerable. For me, the reason is the utilitarian one that they are making very poor people go hungry.
But is it really morally repugnant for educational buildings to be named after rich donors? Sandel objects to a school naming its donated gym after ShopRite. Yet he, the Anne T and Robert M Bass Professor of Government, researches in Harvard’s Harry Elkins Widener Memorial Library, named by a grieving but rich mother after a young Harvard student who died on the Titanic. Is the passage of time enough to disinfect the transaction?
He ends the book with a question: “Are there certain moral and civic goods that markets do not honour and money cannot buy?” This is rhetorical. Of course the answer is, yes. But how do we know what they are?
We are reluctant to allow moral and spiritual concerns into public debate, says Michael Sandel. Instead, we’ve come to rely on the market to assign value.
More than ever, we live in a society that sells and puts a price on just about anything.
Couples can hire an Indian surrogate mother for $6,250. Or they can invest that money in the American insurance industry, where betting on the death of strangers is a $30-billion business. Investors receive higher returns the sooner the stranger dies — a morbid spin on the adage that time is money.
Hunters can head to South Africa to kill an endangered black rhino provided they’re willing to pay $150,000 for the privilege. Or they can stay in Canada to kill a walrus for less than $10,000. Add a caribou, musk ox and polar bear and you’ll hit what hunting groups call the “Arctic grand slam.”
If it’s citizenship you’re after, $500,000 buys the right to immigrate to the United States. Many countries have similar policies, including Canada, though the price is higher here.
Even in prison, money matters. In some cities, prisoners can upgrade their cells with a nightly fee.
Teaching political philosophy at Harvard University, Sandel has practiced for years the art of merging the philosophical and the topical. His course on justice, for instance, is wildly popular. More than 15,000 students have taken it — and more than 1,100 students have registered in a single semester, making it the largest-ever class in Harvard history.
Repackaged into a 12-episode TV program produced by WGBH-TV, it’s “the first Harvard course to be made freely available online and on public television,” reads the program’s website.
The series has generated millions of views on YouTube, and the lectures have been aired, translated and rebroadcast internationally. In part, that’s due to Sandel’s knack for using simple and seemingly trivial examples to reveal complex, even profound implications.
He’s been doing this outside the classroom as well. In one of his two TED Talks, he invokes Aristotle while grilling audience members about the nature of golf. Is walking across the course part of the game? Is golf still golf if players use carts to get around the course? Sandel explains that concerns about fairness and justice underlie these questions.
He recently finished an international tour that took him to Japan and Korea, countries that trace their philosophical roots to China, not the United States. Yet Sandel is a phenomenon in the region.
He threw the opening pitch at Jamsil Baseball Stadium in Seoul. A few days prior, 15,000 attended a lecture he gave in an outdoor amphitheatre at Yonsei University. American political philosophers rarely attract this much fanfare at home, much less internationally.
At least one Japanese university has created a course to emulate his approach. Korean Supreme Court justice Jeon Soo-Ahn named Sandel a Western theorist worth reading, noting his emphasis on the importance of community. Perhaps that emphasis, at odds with liberal individualism, explains why China Newsweek put him on the cover, naming him the “most influential foreign figure” of last year.
“In almost every democratic society I’m familiar with,” he said, “there is a mounting frustration with politics as it is today. There’s a growing sense that established political parties are not really addressing the fundamental questions that people care about.”
Indeed, Prime Minister Stephen Harper’s critics and supporters alike credit much of his success to keeping divisive moral and spiritual questions out of the public sphere. When abortion became an issue, for example, Harper quickly discouraged the discussion. A national conversation about abortion is off the table “as long as I am prime minister,” he said.
Sandel says that we are increasingly reluctant to talk about what kind of society we want. We are reluctant to allow moral and spiritual concerns into public debate. Instead, we’ve come to rely on the market to assign value.
“Part of the appeal of markets,” he writes in the book, “is that they don’t pass judgment on the preferences they satisfy. They don’t ask whether some ways of valuing goods are higher or worthier than others.”
The market is only interested in efficiently matching buyers and sellers. It is not interested in what is being distributed, or whether it is fair — let alone whether some things should be distributed at all.
Should pro-life groups be allowed to pay pregnant, abortion-seeking women to keep their children? Should those groups be allowed to pay habitually pregnant women — many addicted to drugs — to submit to sterilization? Such questions, admittedly, are less familiar in Canada than America, where both practices have arisen.
But these are precisely the questions Sandel believes we should be asking ourselves. How do we make these decisions? How should we think through them? Should certain things just not be up for sale, even if there are people who might freely consent to the exchange?
He does not oppose inequality everywhere, but believes that too much of it is dangerous. “Democracy does not require perfect equality,” he writes, “but it does require that citizens share in a common life. What matters is that people of different backgrounds and social positions encounter one another, and bump up against one another, in the course of everyday life. For this is how we learn to negotiate and abide our differences, and how we come to care for the common good.”
However, inequality isn’t Sandel’s only concern. He opposes marketization, he says, because it degrades and corrupts social values. “Certain goods have value in ways that go beyond the utility they give individual buyers and sellers,” he writes. “How a good is allocated may be part of what makes it the kind of good it is.”
An example he provides is standing in line. There is, he says, a certain ethic of the queue. In grocery stores, for example, people can’t pay to jump ahead. The ethic is: first come, first served.
Likewise, immigration policy. Sandel writes in his book about Peter Schuck, a law professor at Yale Law School, and his proposal to create a market for refugees. The plan would entrust an international body to assign and allocate refugee quotas to member countries. Countries that don’t want to admit refugees could sell their responsibility to others more willing to take them.
In the long run this might efficiently match refugees with host countries. “Anything that would allow more refugees into prosperous Western countries would be a good idea,” says Catherine Dauvergne, Canada Research Chair in migration law at the University of British Columbia.
But the proposal grates against the sensibilities of some. “There is something distasteful about a market in refugees,” Sandel writes, “even if it leads to more refugees finding asylum.”
“A market in refugees changes our view of who refugees are and how they should be treated. It encourages the participants — the buyers, the sellers, and also those whose asylum is being haggled over — to think of refugees as burdens to be unloaded or as revenue sources, rather than as human beings in peril.”
“The thesis that Sandel is presenting is one that is really controversial and is not obviously correct,” says Joseph Heath, a University of Toronto philosophy professor.
“The idea that you can get a whole theory of the welfare state out of this idea that it’s just morally unacceptable for markets to do certain kinds of things — I just think the argument’s totally wrong.”
Author of The Efficient Society and co-author of The Rebel Sell, Heath embraces markets when they’re useful. About critics of the expansion of the market, he says, “what they typically do is they point to obvious examples where we think it’s really problematic for there to be a market for something, so we think that buying and selling sex is bad and so prostitution is illegal; and we think that buying and selling transplant organs is bad and so markets for organs are illegal in North America.
“But then what they do is they move very quickly from that and say ‘well, health care and education and pensions, they’re all exactly the same thing.’ But there’s actually a huge jump from kidneys and sex to health and education.”
To this, Sandel might note that lines are not easily drawn. And wherever you stand on the issue, Sandel believes we should aspire to at least engage one another in a deep discussion about what can be bought and sold, rather than off-loading that responsibility to the market. Our hesitation to undertake the great task of creating a robust democracy will not persist without consequences.
“If you try to empty the public discourse of substantive moral and spiritual questions, what you get, on the one hand, is a managerial, technocratic politics, which is all too familiar in recent decades,” he says. “But that is never satisfying or inspiring, and so there will be a tendency to fill the moral void, and it is often filled with the most narrow and intolerant of voices.”
“Fundamentalists rush in,” he warns, “where liberals fear to tread.” And so we need a deeper discussion about what matters most to us, about what kind of society we want. “Do we want,” Sandel asks, “a society where everything is up for sale? Or are there certain moral and civic goods that markets do not honour and money cannot buy?”
Fundamentalism is the demand for a strict adherence to specific theological doctrines usually understood as a reaction against Modernist theology, primarily to promote continuity and accuracy. The term “fundamentalism” was originally coined by its supporters to describe a specific package of theological beliefs that developed into a movement within the Protestant community of the United States in the early part of the 20th century, and that had its roots in the Fundamentalist–Modernist Controversy of that time. The term usually has a religious connotation indicating unwavering attachment to a set of irreducible beliefs. “Fundamentalism” is sometimes used as a pejorative term, particularly when combined with other epithets (as in the phrase “right-wing fundamentalists”).
Modern American liberalism combines social liberalism with support for social justice and a mixed economy. American liberal causes include voting rights for African Americans, abortion rights for women, gay rights and government programs such as education and health care. It has its roots in Theodore Roosevelt’s New Nationalism, Woodrow Wilson’s New Freedom, Franklin D. Roosevelt’s New Deal, Harry S. Truman’s Fair Deal, John F. Kennedy’s New Frontier, and Lyndon B. Johnson’s Great Society. Conservatives oppose liberals on most issues; the relationship between liberal and progressive is debated
Keynesian economic theory has played a central role in the economic philosophy of modern American liberals. The argument has been that national prosperity requires government management of the macroeconomy, to keep unemployment low, inflation in check, and growth high.
John F. Kennedy defined a liberal as follows:
…someone who looks ahead and not behind, someone who welcomes new ideas without rigid reactions, someone who cares about the welfare of the people — their health, their housing, their schools, their jobs, their civil rights, and their civil liberties — someone who believes we can break through the stalemate and suspicions that grip us in our policies abroad, if that is what they mean by a ‘Liberal’, then I’m proud to say I’m a ‘Liberal’.
Modern American liberals value institutions that defend against economic inequality. In The Conscience of a Liberal (2007), by Paul Krugman, p. 267, he states: “I believe in a relatively equal society, supported by institutions that limit extremes of wealth and poverty. I believe in democracy, civil liberties, and the rule of law. That makes me a liberal, and I’m proud of it.” Liberals often point to the widespread prosperity enjoyed under a mixed economy in the years since World War II. They believe liberty exists when access to necessities like health care and economic opportunity are available to all, and they champion the protection of the environment. Modern American liberalism is typically associated with the Democratic Party, as modern American conservatism is typically associated with the Republican Party.
How voters identify themselves has been fairly stable over the last two decades. As of August 2011, 19% of American voters identify themselves as liberals, 38% as moderates and 41% as conservatives. In 1992, 18% identified as liberal, 40% as moderate and 35% as conservative. Turnout, however, fluctuates. Liberals comprised 20% of the voters in 2006, 22% in 2008, 20% in 2010, and 25% in 2012, which was the highest rate in decades.