By Theo Herold
The emergence of Protestantism gave rise to a gradual change in society, one that would later come to leave its mark on contemporary political theory and ideology: capitalism. As with any Christian derivative, the three Protestant branches valued the all-too classic concept of a devoted, hard-working Christian living by the word of God. With time, “devoted” and “hard-working” became the fundamental conception of what made a person morally good in the eyes of the church. The early stages of capitalism were born out of Christian values: the more money you had, the more devoted you were to the Protestant church and Christianity. The ideology of capitalism as it is today went through changes over the years, but its roots can be traced to Protestantism. In turn, this ideology reshaped society through and through.
Fast-forward to the 21st century. The political left favors a planned economy, the right promotes free-market capitalism. To what extent depends on the parties and countries in question, but generally speaking this is the case. It is also the case that capitalism and liberalism usually get pointed to when it comes to inequality. Inequality is a broad term, but in this article I define inequality as unequal pay between the genders for the same amount of work, exploitation of workforce and unequal distribution of wealth. Claiming that we live in an equal society is foolish, as countless statistics show us that men have higher median income, dominate boards and parliaments around the world, are more likely to get hired… I could go on. One must not forget that inequality is not limited to gender. We can see it in race, age, culture and religion as well. However, I am inclined to believe free market capitalism has become the scapegoat for all this, for the wrong reasons. Our society is built around the fundamental principle of accumulating capital by trading, buying and selling on some form of market. Said market can be planned, free from state intervention, and everything in between. Simply put, whether we live in a liberal or socialist society, whether we have a planned economy or a free market, society is built on principle of two or more actors entering into an exchange of goods and services.
Capitalism as an ideology and way of life replaced the popular 1500-1700s mercantile theories, and thus changed how trade worked between nations, enterprises and individuals. Mercantilism with its focus on capital accumulation and a strong centralized state gradually faded out and was replaced with capitalism, which focused on private property rights and the free market. Somewhere along the line, people seemed to forget what the state heavy mercantilism lead to, e.g. imperialism, and instead prescribed a label of “exploitation” and “inequality” specifically to capitalism. Are these qualities inherent to capitalism, or are these labels unjustified? This is where the problem lies, and my theory is that it’s a question of morals – I call it Moral Capitalism.
My argument is that regardless of what market we have, it ultimately comes down to morals. Governmentally owned corporations have been found to use child labour, have boards predominantly occupied by men, contribute to the wage gap between the genders, et cetera. One does not have to look further than Scandinavia to find concrete evidence of this. Stora Enso, one of the world’s largest companies within the forest industry, is majority owned by the Finnish state. In 2012, Stora Enso received a report on middlemen in Pakistan using child labour, but chose not to disclose any information regarding the report. Poor morals led them to turn the other way. This is but one of countless governmentally owned companies with similar track records. Nevermind the fact that textbook communism has never worked, and only led to starving masses and an empowered elite. In this light, planned economy and state regulation has not achieved the equality it has aimed for. As such, is it really fair to say that a planned economy or an interventionist state is more ethical as opposed to a free market? Inequality exists in both systems, hence we cannot solely blame free-market capitalism. Regardless of political preference, when it comes to how markets work, your actions on the market depend on your morals, not how free the market is.
The left-wing criticism for capitalism, liberalism and the free market is based on the claim that that the free market promotes exploitation of other people. Leftists argue that governmental regulation paves way for an equal market, with less exploitation and fairer opportunities. But is this really the case? Planned economies fail just as much at promoting the equality leftists so eagerly pursue, and therefore we have to negate market type as the be-all and end-all for creating an equal society. Instead, the issue seems to be that people are unable to realize their full potential because a force is prohibiting them from doing so. This hidden force can exploit people, and will do so, without proper handling. A socialist would put faith in the state to handle the force by regulation, and a liberal would put faith in the invisible hand to handle it. But as we have seen, it will not matter what kind of market you live in — if you lack a moral compass, you will strengthen this negative force.
Theo Herold is the Program Secretary of UF Uppsala and a political science student with a passion for diplomacy and politics. He’s a book nut and hockey geek, and doesn’t shy away from a heated political debate. Besides dreaming of experiencing different cultures and leaving a mark within the subject of political science, he strives to work within the EU with diplomatic assignments.
The Uppsala Association of International Affairs is politically independent. Views expressed in articles published by us reflect the opinions of their writers and should not be interpreted as the views of the Association of International Affairs or Uttryck’s editorial board.