An Economics of Ethics



Yes, the title sounds really bullshitty, but it certainly is an eye-catcher, isn’t it? If you listened to last week’s belated post, you may recall me talking about my journey to anarchism. When I was rounding the bend on my final approach to liberty, I was repulsed by certain environments I encountered and was kinda’ forced to enter the philosophy of anarchism through the back door. The rabid paulbots were throwing temper tantrums over the media ignoring the existence of their messiah. The Libertarians were too busy voting, raising money, pretending to be freedom-minded while also pretending to be politicians and endorsing ridiculous concepts like abortion and gay marriage. The objectivists were being generally surly, demeaning, and staunchly atheist. The AnComs were too busy burning down private property to be bothered by the fact that the government was out to get us all. Most distressing, though, were the AnCaps.

“Wait, ain’t you an AnCap?” Not quite. If you recall my post about the MadPhilosopher logo, I consider myself to be just a straight-up anarchist. Since before I had started this blog, I have been economically literate enough to know that capitalism is, for all intents and purposes, a necessary and inevitable feature of pre-and-post-state societies, but that doesn’t necessarily make me an AnCap. Part of the reason I don’t consider myself to be so is because of the experiences I had with them on my way to liberty.

My first exposure to anarcho-capitalism was under the more innocuous name of “Austrian Economics” when I was reading Rothbard and Spooner. I read these guys towards the end of my communist days, when I was trying to figure out why previous attempts at the communist experiment didn’t work out. I was hoping to find a handful of controls that those dirty capitalists had come up with to ensure that products were manufactured within expected tolerances. For example, if I go to Home Depot, a great number of things are standardized. You’ve got X, Y, and Z diameters of pipes and fittings, and there seems to be the perfect supply available to meet demand; rarely would something run out, but there were only ever a couple dozen items on the shelves… and in communist experiments, people would cut corners to meet the letter of the regulations while putting in the minimum quantity of resources. “Make a million nails,” results in thumbtack-sized nails. “Make this weight in nails,” results in railroad spikes. And when it gets to the point of “Make a million nails that are exactly this size, shape, and out of this material… and if you don’t, it’s off to the gulag with you,” results in everyone saying “fuck it, I quit” and the USSR collapses overnight.

Clearly, I didn’t get the answer I wanted. “Stop making regulations, and let people do what they will… don’t worry, it’ll all work out just fine,” isn’t exactly what a communist wants to hear. I learned a lot, though; it definitely had a pronounced effect on my migration from communism to the Tea Party and then to liberty. I returned to doing research in the Austrian School when I was getting into objectivism, later on, and that’s when I discovered the AnCaps. There was a specific distinction in the rhetoric of the Austrians like Rothbard as compared to the AnCaps I met: awareness of the is/ought divide.

The AnCaps I met, either through their ignorance or a misunderstanding on my part, seemed to equivocate that which is economically advisable as identical to that which is ethically desirable. This was disappointing to me; AnCaps were clearly the inheritors of the Austrian School, but they lacked the moral awareness of their predecessors. My motivation for communism and the subsequent ideological migration was primarily a moral one, as fits in the rhetoric of Aristotle, Aquinas, Marx, and Trotsky, and to hear “That which is profitable is that which is moral,” rubbed me every wrong way. I am totally open to this interpretation being mostly due to misunderstandings on my part, though.

The communist projects, ostensibly, are an attempt at adapting economics to ethics. Ironically, the Tea Party, in their own fucked-up way, are engaged in a similar project: attempting to adapt politics (the widespread application of violence) to ethics. Even Rand and the objectivists are engaged in that project: adapting public consciousness to ethics. So, to see AnCaps seeming to do the reverse, adapting ethics to economics, was so contrary to my methods of reason that I didn’t know how to process it. Now that I’ve mentally acquired my liberty legs, I see anarchism as an attempt to adapt oneself to objective moral facts… something that Christians ought to be more sympathetic to.

In hindsight, I think that I misunderstood mostly due to the paradigm I was operating in, adapting various things to ethics. I think that one thing that didn’t help, though, was the lack of philosophical knowledge on the part of the AnCaps in question. I think I’m gonna try to fix that here. That which is profitable is not necessarily moral. It could be profitable to rob a liquor store, but it’s a violation of one’s right to be free from theft and is therefore immoral. On a long enough timeline, I argue, that which is moral is most profitable. For example, not robbing a liquor store will most likely play out better for one in the long run. Even virtuous things, such as sustainable living or industry, when done responsibly and rationally, are likely to play out well in the long run; investments in oceanic desalinization would have suddenly become incredibly profitable in California in recent years and the same can be said for growing homegrown organic hipster-feed.

What do I mean by this is/ought, ethical/economic divide? As I said, when talking about Paradigmatic Awareness and Moral Ambiguity, one’s actions ought to be informed and rational. Statements of “should” or “ought”, when concerning a person’s actions, are without exception either ethical or moral statements. (Taxonomic note: I consider moral statements to be statements as relate to objective moral facts and ethical statements to be “if->then” statements predicated on value judgments, but that’s a different blog post that hasn’t been written yet.) Moral statements are relatively easy: something is either moral or immoral, depending on it’s status as relates to deontological principles… you know, murder coercion and theft are immoral. Ethical statements are a little more involved, and tend to be at the heart of a lot of angry internet arguments: “If you care about poor people, you’ve gotta vote for this rich guy,” or whatever.

In order to make an accurate ethical statement, one must understand the intricacies of the “if” and have a solid grasp of the way the world works in order to produce the appropriate “then”. This is where economics comes into play. It goes well beyond “if you want to pay rent, you probably shouldn’t buy this meth,” and even beyond, “if you care about poor people, you should probably lift employment regulations so that they can get a job.” For example, an understanding of basic principles of economics can inform decisions that have nothing to do with money itself. This is because economics is about management of scarce resources, not just money. For example, if I have a limited amount of time and I’m trying to maximize my gains in family relationships, self-education, and general pleasure, then I should probably try to generate an overlap in applications: do something educational with the family that isn’t boring as hell. Knowing when to cut one’s losses is another useful piece of information: cost-benefit analysis, risk assessment, utility assessments, etc. are, too.

In other words, it’s not a statement of morality to say eliminating perverse incentives can incentivize productive behavior; however, it is an ethical statement to say “if you want to encourage productive behaviors in moocher and looter classes, then you should try to eliminate perverse incentives.” I’m not talking matters of political policy, mind you. After all, managing the widespread application of violence is immoral and if one wants to make the world a better place, then they should opt-out of political engagement.


Remember: anarchy is a philosophy of personal responsibility. How can one hold themselves to a moral or ethical standard if they don’t know how to accomplish their goals or even set those goals? If one wishes to travel to a third world country and improve the quality of life of the people there (preaching religious views included, but optional), they ought to understand what behaviors are being incentivized by showing up and just giving things away or doing the work oneself. Without educating and assisting in the development of infrastructure, gifts and labor are more harmful than helpful. Before trying to do good, one must know how.

TL;DR: Economics and ethics are two different fields of study. However, ethics devoid a solid understanding of how the world works is useless at best and misanthropic at worst. As much as statists will try to deny it, economics is an excellent instrument for understanding human action. Basic scientific literacy, including physics, chemistry, economics, etc. is necessary for the development of a solid ethical grounding. This distinction and requirement is important to acknowledge explicitly when discussing economics and/or ethics with non-anarchists, lest outsiders misunderstand.


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