Is Capitalism Structurally Amoral?

Would I say that Capitalism is structurally amoral? I do not know. It depends on what is meant by Capitalism. I treat voluntary exchange relations as good from the point of view of the individuals in the exchange. For them the trade was good. For them an obstacle to that exchange would be bad. This treatment is amoral in that it does not interrogate as to the nature of the good or service exchanged. I buy an apple for less than my full willingness to pay, I am happy. The grocer sells for more than her reservation price, she is pleased. A random stranger propositions me with some money to perform personal favors for them. So long as we are both made better off in our own estimation the transaction is treated by good as each of us, and the economist does not impose a normative judgment on those actions. A price floor on apples that requires all apples to be sold for $2.50 a lb, including the falsely named Red Delicious, could result in fewer consummated voluntary exchanges. Some sellers willing to part with their mushy mealy poms for $1.00 will be prohibited from doing so, and the buyers willing to buy those faulty fruits if priced low enough will not be able to buy. From their point of view the price control is a bad thing. A prohibition on paid personal favors will result in unconsummated opportunities for mutual gain. To those individuals the prohibition is bad. Mutually beneficial exchanges require at least two foundational institutions: private property and contract enforcement. A freely fluctuating price system and the opportunity for profits and losses to accrue to individuals who participate in markets contribute to the frequency of exchanges. I like to see exchanges happen, and the more the better. To the extent that an apology for Capitalism is limited to the above, I can claim that there is no imposed virtue or vice. If the claim that “Well, the people engaged seem to like it” is treated as moral judgment, then I stand guilty as charged. So, the question falls back to the morality of making moral judgements about others and for others. If it is immoral to allow voluntary consummation of actions exogenously judged immoral, then Capitalism does allow immorality and is thus itself immoral. I would wonder from whence the intuition and authority to judge actions as moral or immoral arises if not from the voluntary decisions of individuals. The caveat at this point would be the problem of market failure or externality. Most voluntary exchanges have implications for individuals not directly a party to the exchange. Some are benefited, some are harmed. Market failures provide justification for collective action. Many market failures are resolved through private collective procedures and governance mechanisms voluntarily subscribed to. We might be able to avoid overuse of common pool resources through private governance of those resources. Imposed governance systems, those that go beyond voluntarily agreed to action, face lower costs to making errors and so are more likely to create rules or regulations that cause more harm than good. Markets fail. Government also fails. Markets face more robust feedback mechanisms. Markets, whenever possible, are identified as producing better results than government corrections to markets, from the perspective of those affected by markets and regulations. The gorilla in the room is environmental policy, especially catastrophic disasters that might only be prevented by limits on voluntary exchanges that no one would voluntarily adopt unless everyone else also agreed. There is a collective action problem. We might all agree to the imposition of a governance structure that monitors and regulates our actions so as to reduce the likelihood of catastrophe. The agreement to such a constitutional structure is within the realm of acceptable options for most apologists for Capitalism, reflecting an affinity for Rawlsian analysis. The challenge is that once a constitution has been struck, it almost immediately becomes unstable, and constraining the actions of governing agents takes resources away from other voluntary exchanges. Still, the point of view can remain positive rather than normative so long as the mechanism for judging a structure is to look at the benefits and costs to the people affected as they would measure them.