Andersen: Luxury crises and moral dilemmas
Wrestling with moral conflicts in America is a luxury crisis. Applying ethics to disposable time and discretionary income is a quandary of privilege that most of the world doesn’t have.
For the typical American consumer, there’s no denying complicity with the materialistic American world view and all that comes with it. Social norms are too pervasive to evade, and most of us buy into them with a shrug. In the age of Donald Trump, moral quandaries have become a gnawing preoccupation.
Unless you live a truly sustainable life by living off the grid with clean, renewable energy and a greenhouse, it is impossible to avoid the taint of industrialization that is wreaking ecological havoc on the biosphere.
Some appease a nagging conscience by refusing to invest savings through typical investment strategies because those investments represent a form of economic collusion with Wall Street. Investments are a first-world luxury that should prod the collective conscience.
I posed this notion to a respected and successful investor friend in Aspen who cautioned that I was on slippery ground. He said most “investments” are not in any real way aiding or abetting the corporations that one might put on the socially irresponsible list. He used Exxon as an example.
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“Exxon receives zero proceeds from a current purchaser of its shares. Exxon operates off of its flow of profits and maybe some debt financing, but not net share sales. The only real financiers of Exxon today are banks and bond buyers, not stock day traders or long-term stockholders.”
So, if you own Exxon shares, you may not be directly responsible for Exxon’s gargantuan carbon footprint, but may still feel guilt by association.
Another problem with attaching morality to investments, this investor said, is definitional: “Almost all large corporations are doing something somewhere that can be argued by rational people as socially irresponsible.”
He listed alcohol, tobacco, sugar, most saturated fats, weapons of any kind, cars, trucks and planes. In short, he said, “anything that needs energy to make or transport all goods and most services that involve economic activity across distance” have downsides.
But, he cautioned, “Most bads are not unqualified bads. Most economic bads come with social goods attached.” Lifting the world out of poverty and ignorance is one such good.
This is where moral relativism thwarts rigid posturing by adding baffling layers of nuanced judgments about production and consumption, all weighed through an infinite range of individual value systems and competing virtues.
“If a moral thinker can admit fallibility,” my investor friend philosophized, “it is not easy to be dogmatic, except as to the few ‘thou shalt not kill’-type concepts generally regarded as universal.”
It is rare that a financial professional would become so philosophical, but this is Aspen, where this investor and I recently shared the seminar table at the Aspen Institute and bantered over the philosophy of moral virtue.
“I am a fan of Kant’s categorical imperative,” he said, “which I interpret as such: An act is immoral if everyone on the planet did it and the outcome would be demonstrably harmful to society.”
Applying this view to climate change, one might conclude that the aggregate of human economic enterprise is causing human suffering through climate instability. As such, the outcome of most economic activity is immoral.
“But look at the other side,” he said. “If everyone on the planet refrained from doing any economic activity across distances, what would the outcomes be? Not good — undeniably bad — for all but a handful of the world’s citizens currently endowed with some land for a garden and, more important, isolated from the chaos and violence the rest of us would be facing. So we are in a real world of trade-offs.”
Those trade-offs are not typically factored into asset/liability equations, except by a rare breed of philosophical investors. If we had more such thinkers wielding economic clout, moral inquiry might become a requisite of business schools.
That would muddy the waters for MBA aspirants who put economics and finance above moral quandaries. Such quandaries are ignored in deference to utility and expedience as the iron glacier of capitalism grinds away inexorably at the commons.
Paul Andersen’s column appears on Mondays. He may be reached at firstname.lastname@example.org.
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