Many of you will have seen earlier this year the publication of the book “What Money Can’t Buy: The Moral Limits of Markets” by Michael Sandel of Harvard University (http://www.amazon.com/What-Money-Cant-Buy-Markets/dp/0374203032). Sandel teaches a hugely popular course at Harvard titled ‘Justice,’ a semester-long series of classes from which are posted online (http://www.justiceharvard.org/). Over the summer, I saw an interview of Sandel on the PBS Newshour by its economics correspondent, Paul Solman:
The interview was good, as is the book, but one quote by Sandel stood out:
“Over the last three decades, we've actually drifted, without quite realizing it, from having a market economy to becoming a market society.”
Sandel went on to explain what he meant by the distinction:
“A market economy is a tool, a valuable and effective tool, for organizing productive activity. But a market society is a place where almost everything is up for sale. It's a way of life where market values seep into almost every sphere of life, and sometimes crowd out or corrode important values, non-market values.”
This insight resonated and stayed with me for a while. I saw a couple of interviews Sandel gave to promote his book and, in both of them, he struggled to define the line of what is morally acceptable and what is unacceptable. The approach of the interviewers always seemed to be: “Is this OK?” “Well, what about this?” “And, what about this?” etc., etc. To his credit, Sandel stated that he is not trying to define the line of acceptability in determining morally appropriate behavior, but making the broader point that:
“… the question that worries me is, when almost everything in our public life, not just access to the fast lane, is sold off to the highest bidder, something is lost. Money comes to matter more and more in our society. And against the background of rising inequality, that takes a toll on the commonality of our civic life. … My concern is with the accumulated effect. Are we cheapening important social goods and civic goods that are worth caring about?”
The article in the first url below quotes Sandel making the same point more directly:
“‘When we decide,’ he goes on, ‘that certain goods may be bought and sold, we decide, at least implicitly, that it is appropriate to treat them as commodities.’”
Ultimately, however, a weakness in Sandel’s argument is that it is relative rather than absolute. He is not arguing from a point of principle (i.e., an action is absolutely right or wrong), more that too much of an action is harmful, but some of it is OK. Although expedient, this weakens what he is saying somewhat. Adopting this approach makes drawing the line between right and wrong, between acceptable and unacceptable behavior, extremely difficult to do (as demonstrated in the interviews he gave). Worse, it becomes a subjective exercise, which allows each of us to rationalize what we deem to be OK. Again, while I understand why he adopted this less stringent standard, the result is unhelpful in the broader sense because behavior becomes determined by the individual, rather than some aggregated sense of what is socially most beneficial.
One other criticism I have relates directly to the book’s title. It is not really the moral limits of markets that Sandel is concerned with, but the application of a dollar-value to goods and services that were previously valued in different ways. For example, in Chapter 1, Sandel makes a big deal about how we can now increasingly pay to cut the queue (think paying extra to go through airport security faster, or ticket scalpers that re-sell highly sought after tickets well above face value). Sandel critiques economists’ justifications for such actions on the basis that it is not only willingness to pay that demonstrates demand for a product, but also ability to pay (poorer people are less able to do so than richer people). Queues, Sandel contests, are more democratic and, therefore, more morally justifiable. What Sandel does not appreciate, however, is that queuing for something is also a market—a market valued in time, rather than money. While the poor student can argue that s/he cannot afford to buy tickets for a popular concert or sporting event, the wealthy CEO can argue with equal justification that s/he cannot afford the time to queue for the same ticket. Queuing or paying both serve the same function—to ration a scarce product using a scarce resource (for the student, money is scarce, but for the CEO, time is scarce). As such, it is not the moral limits of markets that Sandel should be targeting, but the moral limits of money. While both markets (money and time) have their moral limits, an increasing focus on one type of market over another (i.e., money over time) favors one group of society (the money rich) over another (the money poor), but Sandel’s queues similarly favor a different group (the time rich over the time poor).
The second part of the Solman interview can be seen at:
The article by Thomas Friedman in the second url below adds further commentary on Sandel’s book:
“Throughout our society, we are losing the places and institutions that used to bring people together from different walks of life. Sandel calls this the “skyboxification of American life,” and it is troubling. Unless the rich and poor encounter one another in everyday life, it is hard to think of ourselves as engaged in a common project. At a time when to fix our society we need to do big, hard things together, the marketization of public life becomes one more thing pulling us apart.”
Take care
David
In Economists We Trust
By Jonathan V. Last
April 21-22, 2012
The Wall Street Journal
C7
This Column is Not Sponsored by Anyone
By Thomas Friedman
May 13, 2012
The New York Times
SR13
