Re: A neo-liberal nihilism?

Thomas Ash
22 June 2009

An OurKingdom conversation. [History: Thomas Ash > David Marquand > Thomas Ash > George Gabriel > Thomas Ash > George Gabriel > this post > George Gabriel]

George Gabriel is targetting "neo-liberalism as an individual code of ethics"; effectively, one of egoism. I doubt that any of neo-liberalism's defenders have ever understood it as such; most commonly, they advocate a set of policies on the grounds that they will promote some value, be it individual freedom or an increase in welfare supposedly brought about by more efficient markets. True, as George points out, they have often modelled individual economic choices as self-interested in the course of arguing that their policies will best promote these values. But for this purpose it functions only as a simplifying assumption, which needs only predict a subset of our choices (not extending to many moral ones, such as whether to offer bus seats to frail old gents, which have little impact on the efficiency of markets) with a rough degree of accuracy. The neo-liberals are commited to its doing so does not mean that they are commited to its capturing all the motives behind human behaviour, let alone to adopting self-interest as their only motive.

If neo-liberals are not commited to an egoistic code of ethics, what about bankers? The bulk of George's commentary concerns them, after all, and they are  a quite distinct group, not all possessing neo-liberal opinions about public policy (or any opinions about public policy at all). In the comment thread on his initial post, George claims that their actions show that they live by this code in practice, if not necessarily in theory. I would be surprised if most bankers' lives did contain some altruistic acts which belied this claim, but perhaps George was concerned only with their work lives. However, I struggle to see what they do in this that reflects a concern with self-interest to the exclusion of any other value. George talks of those who "short sell a productive company into oblivion, reap obscene payments for failure, and gamble the money of others". It is only possible to do the first in a highly unusual situation in which a company's survival depends on its stock price - generally a sign that it is not a succesful, productive company. The second does no harm to anyone else, and hence it shows a concern with select-interest, but not to the exclusion of any other value. And it was ultimately the bank bosses' decisions while led to investors' money being put at such risk - some of them (like Jimmy Cayne of Bear Sterns) supposedly did not understand this, and the decision was evidently against their self-interest.

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