Monday, 23 July 2012

What money can’t buy - Sandel, 2012

„Today the logic of buying and selling no longer applies to material goods alone, but increasingly governs the whole of life.“ (Sandel, 2012, p.6). „When we decide that certain goods may be bought and sold, we decide, at least implicitly, that it is appropriate to treat them as commodities, as instruments of profit and use.“ (Sandel, 2012, p.9).

Thus „markets have become detached from morals and that we need somehow to reconnect them.“ (Sandel, 2012, p.6) and he concludes that „we drifted form having a market economy to being a market economy.“ (Sandel, 2012, p.10).

The corruption argument is the more interesting one: It basically says that „some of the good things in life are corrupted or degraded if turned into commodities. (...) health, education, family life, nature, art, civic duties and so on.“ (Sandel, 2012, p.10).  “Turning access to Congress into a product for sale demeans and degrades it. From an economic point of view, allowing free access to congressional hearings „underprices“ the good, giving rise to queues.“ (Sandel, 2012, p.34). Yet, selling the access „treats Congress as if it were a business rather than an institution of representative government.“ (Sandel, 2012, p.34). „It degrades Congress by treating it as a source of private gain rather than an instrument oft he public good.“ (Sandel, 2012, p.35). Similarly, „a hired friend is not the same as a real one. You could hire people to do some oft he things that friends typically do.“ (Sandel, 2012, p.93).„Somehow the money that buys the friendship dissolves it, or turns it into something else.“ (Sandel, 2012, p.94).

He uses various examples to show this: from the possibility to pay one’s way to the top of the queue these days, to the use of incentives to elicit the desired behaviour (instead of intrinsic motivations), to the betting on life (from life insurances to viaticals), to the commercialisation of sportstars’ autographs. And he summarizes: Most of this market thinking is argued for by utilitarian arguments: “market exchanges benefit buyers and sellers alike, thereby improving our collective well-being.“ (Sandel, 2012, p.29).

But, Sandel elaborates on two core arguments against market reasoning: fairness and corruption: The fairness argument says, that  „market exchanges are not always as voluntary as market enthusiasts suggest.“ (Sandel, 2012, p.111). It is always based on economic necessity and poverty.
Moreover applying market principles and financial incentives crowds out more intrinsic motives: when the Swiss government planned a nuclear waste site most villages weren’t too happy about it. They final focused onone particular village: „Although the facility was widely viewed as an undesirable addition to the neighbourhood, a slim majority (51 percent)  of residents said they would accept it. Apparently their sense of civic duty outweighed their concern about the risks. Then the economists added a sweetener: suppose the parliament proposed building the nuclear waste facility with an annual monetary payment. Then would you favor it? The result: support went down, not up. Adding the financial inducement cut the rate of acceptance in half, from 51 to 25 percent.“ (Sandel, 2012, p.115).„the offer of cash to residents oft he village felt like a bribe, an effort to buy their vote.“ (Sandel, 2012, p.115). „The offer of a private payoff transformed a civic question into a pecuniary one.“ (Sandel, 2012, p.116).

Sandel concludes: „Some things are so fundamental to the orderly operation of society (...) so intrinsic to its dignity, that they have traditionally been entrusted only to people hired and equipped by all of us, in the interest of the common good.“ (Sandel, 2012, p.194).„The great missing debate in contemporary politics is about the role and reach of markets. Do we want a market economy or a market society?“ (Sandel, 2012, p.11). „we hesitate to bring our morals and spiritual convictions into the public square. But shrinking from these questions does not leave them undecided. It simply means that markets will decide them for us.“ (Sandel, 2012, p.202).