An Unusual Animal: A Coherent Economic Ethics

This is an unusual number of OIKONOMIA, about an unusual book. In future, we plan to have other "special issues" on other books or subjects, but it is fitting that our first is on a book with the kind of long term significance that Etica Economica will have. Reading it, one realises that there really do still exist people who have a encyclopaedic knowledge, as the subtitle indicates, even if Arthur Utz, at over 90 years of age, has had longer to acquire such expertise than most of the rest of us. My main question at the end of having carefully read the book was: how can I make sure it gets translated into English?

This is not to say that everything about the book would be acceptable even to economists and ethicists sympathetic to the Thomistic orientation of the book. As the comments in this number of OIKONOMIA show, there are disagreements over particular positions taken by the author, or over things that could have been said and were not, and so on. No-one, however, disputes the validity of the general philosophical system and method used by the author, which he regards as building on the basic approach (atteggiamento fondamentale) of St Thomas, modified at subsequent stages of analysis given the great differences between our modern day context and that of St Thomas. It is significant that Utz demonstrates a clear understanding of other possible ethical systems for approaching economic questions, but states explicitly that no system that he has studied measures up to that of St Thomas’ in its adequacy "for finding the logical way from universally valid norms to the solution of concrete practical problems" (p.9). Utz’ method, therefore, is not new as a whole, though there are clearly some innovations that he introduces, even with respect to some of his great contemporaries such as Johannes Messner (See p. 35, for instance). The importance of his book lies rather in the pains he goes to in applying this method consistently and precisely at every stage of the analysis. Few modern treatments of economic ethics could claim this combination of both breadth and coherence.

The structure of the book is also interesting. Chapter 7 of the book represents its core. The chapters before build up to it, and those after develop its implications. In the first three chapters, the author presents the diversity of ways of looking at the economy, and how his own approach is situated with regard to these others. He demonstrates that a "rational" economic ethics must be oriented towards the realisation of goals or ends (or goods), just as economics itself is; otherwise, the disciplines of ethics and economics cannot interact with each other on a rational level. Then follow three chapters that deal with human needs (which give rise to the economy), factors of production, and private property; the implication here is that these are the central elements on which his ethical economic system is based. After the core (and longest) chapter on economic systems, where towards the end Utz provides an overview of a Thomistic economic system, the relationship on which economics is based (that between supply and demand) is considered, along with an interesting discussion of the "ethics of demand" and the "ethics of supply". Other important elements of the system are discussed in more detail in chapters on money and credit, prices and just prices, income and profit. As someone who is more of a specialist in business than in economics, I find it rather daring of the author that the chapter on profit is the last one, and that in a book of 300 odd pages, it merits no more than 6! Yet this is all part of the coherence of Utz’ system; questions of profit are secondary to the systemic issues, at least from the perspective of economics. The one chapter that seems to be in an arguably mistaken place is that on demand and supply, which would seem to be better placed before the central chapter on economic systems. Yet, since most of the chapter is about the ethics of demand and supply, perhaps the problem is more with the title of the chapter than with its position.

The comments on Etica Economica in this issue of OIKONOMIA are by a (Keynesian) economist, two Dominican ethicists (like Utz himself) and a Salesian ethicist, and finally a short but impassioned comment from a politician. These comments are not meant to be exhaustive, but to represent a "snapshot" of views from different disciplines, by those with an interest in both ethics and economics.

It is interesting that it is the economist, Marzano, who expresses the warmest appreciation for Utz, which is all the more striking since he takes a very different line with regard to the thought of Keynes. Bertuzzi uses his comment to make a useful summary of the early chapters of Utz’ book, as well as to underline the necessity of this kind of ethical analysis in the Christian tradition. More than once he criticises those Christians who suggest that in an ethical evaluation of the economy, "nothing more than the gospel is needed" (the equivalent phrase in Italian – basta il vangelo – carries much more force than my rather polite English rendition). Hop and Carlotti both pick up themes connected with money; Hop begins by discussing interest, but quickly moves on to profit (without distinguishing between them), while Carlotti deals with speculation. One wonders what Utz would make of Lessius’ ethical evaluation of the three merchants, X, Y and Z. Still, Carlotti’s main point is that the ethical problems raised by speculation are not new to the Christian tradition; despite innovations in the financial instruments available to speculators, the Christian social tradition already has much experience to draw on with which to deal with them.

Utz recognises the "right to work" discussed with such force by Pallanti as rather the "right to a policy of full employment" (see pp. 98, 114, 223; Pallanti quotes from p. 114, but does not quote this part of the page). In this, Utz wants to ensure that the "right to work" is not seen in the same way as, say, the "right to religious freedom", that is, as a personal freedom to determine the particular kind of job that suits one’s particular individual’s qualities and to expect this job to be provided. Rather, such a right needs to be seen in the context of employment policy, in the sense that each person has the right to participate in the economic process and from this to obtain his or her living. Work in this sense forms part of the final definition of the economic order to which Utz arrives in chapter 7 after considering all the other possible important definitions. Such an economic order, he says, consists of "a competitive economy, founded on the universal individual right to private property, both for productive purposes and for consumption, with the widest possible distribution of productive property, stable prices and full employment" (p. 233). As regards globalisation, Utz would agree that it is mistaken from an ethical point of view for economies to open up too quickly to international competition (p.215). At the same time, he argues that in the context of global competition, where some countries are willing to allow exploitation of their workers, a country that wants to adopt an ethically acceptable economic order has no alternative but to follow traditional Christian counsel: live more austerely, work harder and for a more competitive wage and save more, so that despite these pressures, all may find employment and be able to provide for themselves, even if in a simpler, less affluent way (p.234). In order for this to be realistic proposal, however, he realises that workers must have more of a stake in the "productive property" of their economy, something that is sadly lacking in most capitalistic economies. In a book coming out in Autumn 2000 which I have co-authored with a US theologian, Managing As If Faith Matters, we include a chapter on how ownership of productive property can be more widely distributed in practice.

As a part of his coherent approach to economic ethics, Utz rightly maintains that to produce a professional or business ethics one would need to be a real polymath, capable not only of the breadth of learning he has, but also with wide professional experience. This leaves little hope for a project that is so needed today, given the great interest in "business ethics", despite the vast amount of rubbish that is written and sold under this title. Surely, another possibility would be to use the approach of interdisciplinary research groups, with their members working together within a common (Thomistic) philosophical framework, each bringing their own expertise to the exercise? The Faculty of Social Science could be a place where such research could take place, and this journal could be an organ for the publication of its results. If Utz’ book can be a stimulus to us to take up more fully the challenge of this kind of research, then this first "special issue" of OIKONOMIA will have been special in more ways than one.