Tracing consequences both seen and unseen.
Wirkman VirkkalaBetter Than the Golden Rule?
Posted at 1:37 pm on April 22, 2010, by Wirkman Virkkala

Attempts to summarize all morality into a simple principle are ancient. Long before Kant’s categorical imperative we were blessed with the Silver and Golden Rules. Indeed, there is a sort of progress in the development of these rules:

Silver: Do not do unto others that which you do not want done to yourself.

Golden: Do unto others that which you want done unto you.

Cat. Imp.: Act only in such a manner that you can at the same time will that your act should become a universal law.

But the progress may be illusory. The Silver standard may be best. The negative formulation does not entail perversities that can develop from very particular values. Under the Golden Rule,  my preferences could be so “out there” as to cause disharmony, not increase it. For example, I might prefer to greet strangers with impromptu opera arias. After all, I would prefer it if everyone sung to me. So, taking my strange preference for improvised singing, I inflict upon society a mad barrage of baritone assaults.

Kant’s categorical imperative is, if not more dangerous, at least far murkier. It requires that we figure out which features of an act should be universalizable. Further, as one philosopher noted with some perspicacity, universalizability is easily trivializable.

But, courtesy of John Stossel, I am now thinking of the “wisdom” of Michael Medved:

“You can only make a profit in this country by giving people a product or a service that they want,” [Medved] says. “It’s the golden rule in action.”

Is it, though? Is trade really an instantiation of the Golden Rule?

When I offer a good on the market, am I “doing unto others that which I want done unto me”?

Rarely. Or: Not quite.

As in Kant’s Categorical Imperative, it depends on which features you identify as pertinent and which features you ignore as not.

Say I offer a book on the market, from my large personal library. Am I giving unto others that which I want myself? No. I don’t want the book.

Or, I could redefine the situation (and boy, do philosophers and normal rationalizers know how to redefine situations!) to say that I am offering something on the market that someone else wants, and that’s what I want from them: Something I want more than they want.

This is an added complexity. It recognizes value diversity and value subjectivity — something the ancient maxims do not do (though, of course, the commentaries on them often do, of necessity).

Further, to call it the Golden Rule is to take from that rule its element of charity. And charity does seem to have been Jesus’ intention, at least if dozens of preachers I’ve heard expound on the subject can be believed. Trade, on the other hand, withholds desired items until terms for exchange can be met. It’s not about charity. Not at all. Any act of trade increases the advantages of both traders. And both sets are generally out for themselves, thinking of the other only instrumentally, so to achieve greater returns for each’s own interests.

Market activity implies another rule, a rather different formulation: Offer unto others that which you suspect they want; accept from others only what you want more than what you give.

As a positive imperative, this turns out to be far more effective than the Golden Rule. It does so because it demands reciprocal advantages. In the words of Destutt De Tracy,

exchange is an admirable transaction, in which the two contracting parties always both gain

What the Golden Rule aims for, but — because it mentions no element of contract and terms, and is usually promoted in the context of unilateral charity — fails to deliver, exchanges actually accomplish. The rule that exchanges follow is about reciprocity — which the Golden Rule touches on only by imagining it: The reciprocity is all one-sided, in the imagination and motivation of the actor. In exchanges, the reciprocity is an explicit condition of the transaction.

Further, while the Golden Rule apparently demands that one act to others unilaterally to their betterment by your standards, thus implying a huge element of altruism, trades (exchanges of goods and services) appeal to a stronger motivating force (one’s own perceived interests, whatever they may be) and builds the altruism (the mutual advantage) into the very structure of the transaction.

Traditional moralists and critics of capitalism often decry the horror of people aiming to satisfy their separate, horrid egos, but err in two ways, when criticizing trade:

1. Though both parties to any transaction are seeking their own interest, that interest can incorporate (and often does, perhaps usually does) many elements of altruism. For instance, I may be trading to get the best deal on a First Aid kit for my family or church or fraternal organization. My very aim is to serve others. And that First Aid kit may end up serving strangers or visitors. But in seeking out the best price or the highest-quality merchandise, I am likely to be quite diligent in serving my interest, no matter how broadly my interest may be. This is why Wicksteed coined the term “non-tuism.” It’s not egoism that is served by markets, but all sorts of interests. But each transaction itself, by serving the separate interests of those involved, seems egoistic.

2. Though one typically considers a transaction in terms of its advantage to oneself, the good one offers in exchange for what one really prefers is done so in hope that it pleases the opposite party more than what they would trade to you. Though one can certainly imagine this prospect in as cold a calculation as any, often this goes about in the standard human way, through empathy. And even altruism — direct concern for another — plays a part. After all, we offer things that others want.

3. Then there is the element of the very opposite of “moral hazard.” Call it moral assurance, or moral support. By acting to help another on condition that they help you, you further instill in that other the status of independent, autonomous being. Though the goods you exchange are unequal in value — reciprocally unequal, so to speak (in that I prefer what I get to what I give, and you prefer what you get to what you give me) — a sort of equality between the actors is assumed. Each can walk away before the transaction is made. Or each can gain (if each has not engaged in fraud, and each has calculated the returns from the transaction correctly). Such transactions do not impart a sense of communal solidarity. But they do impart a sense of respect. It may be a grudging respect. But each act implies that each participant to a trade is master of their own values, own decisions. Thus each transaction is a form of moral support to moral autonomy. And this is no small cultural contribution.

The Golden Rule is addressed to unilateral action. Further, it prescribes motive. As such, it limits the purview of the analysis of action. By concentrating on it — as many moralistic folk do — one loses track of the actual chains of causation in the social world. Emphasizing the Golden Rule unfits a person from understanding modern society and its ubiquitous element of trade.

It is no wonder, then, that many moralistic critics of capitalism err in economics — seeing only a fraction of the fractal universe engendered by voluntary trades — for they have been trained not only to not see the full reciprocity in exchanges, but they also have been trained to treat others as less than themselves.

That is, the Golden Rule, by focusing on unilateral action and altruistic motive, itself sets up a moral hazard. It encourages those who attempt to follow the rule to view others as beneficiaries of their acts of kindness, not as independent beings to be consulted before acting. And moralists become arrogant, pharisaical pests rather than helpful guides to action. In politics they add to the rot that the Leviathan state so easily sets into society.

This moral hazard element of a key maxim in traditional morality is, in part, a result of its misuse.

But it is a characteristic misuse. Quite understandable.

I remain convinced that the Silver Rule is superior. (There has been a lot of debate about this.) The rule’s “negative element” of discouraging bad acts undergirds the possibility of reciprocal action through trade . . . and other forms of co-operation. It provides the foundation for Destutt de Tracy’s “admirable transaction.” The Golden Rule, on the other hand, encourages the very kind of over-reaching, over-weening moralism that can corrupt a large society, preventing its full flowering in the vast diversity of mutual reciprocity of trade.

Cross-posted at The Libertarian Standard.

Filed under: Economic Theory
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  1. […] preventing its full flowering in the vast diversity of mutual reciprocity of trade. Cross-posted at The Lesson Applied. SHARETHIS.addEntry({ title: "Better Than the Golden Rule?", url: […]

    Pingback by Better Than the Golden Rule? | The Libertarian Standard — 2010-04-22 @ 1:45 pm

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Henry Hazlitt"[T]he whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence. The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups."
Henry Hazlitt, Economics in One Lesson






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