Ponzi, Madoff, and Sustainability

Tom Friedman wrote today about the ethical void that popped out of the revelations of Bernard Madoff’s colossal Ponzi scheme.

The Madoff affair is the cherry on top of a national breakdown in financial propriety, regulations and common sense. Which is why we don’t just need a financial bailout; we need an ethical bailout. We need to re-establish the core balance between our markets, ethics and regulations. I don’t want to kill the animal spirits that necessarily drive capitalism — but I don’t want to be eaten by them either.

Ethics, expressed as responsible behavior towards other human beings and the natural world, is key to a flourishing world, or better the lack of a strong ethical core to basic cultural activities is a root cause of the unsustainable state of today. The restoration of responsible care for ourselves, other humans and the non-human world is central to my book’s way towards sustainability. I argue further that the disappearance of a strong ethical core is directly related to modern cultural central values.

The hegemonic power of money as the means to acquire things one needs and then some, accompanied by the diminution of the importance of relationships, is a cultural fact. As Erich Fromm says, we have exchanged “being” for a “having” mode of existence. Life becomes mechanical and empty of the caring on which all ethics rests. If we do not care about something, there is no need to act in any special toward it.

Capitalism, especially when shaped by neo-classical economic policies that demand ever more growth and fuel the sacred place of money and other socially created forms of wealth, creates a very powerful cultural driver toward the having mode. Other people as individuals and critical parts of institutions become seen more and more as mere means to the acquisition process, and not as other human beings. Like the cars we drive, we think about them as machines. As long as they start when I turn on the key or pay back a return on my money, that’s all I ask. The high technology, lacking transparency, of current financial management only confounds the situation further. Trust is irrelevant or perhaps even impossible. What does it mean to trust my car?

I do not believe that we can restore the balance between “our markets, ethics and regulations” that Friedman mentions without asking more fundamental questions about why the ethical dimension has taken such a battering. I am not even certain that such a balance is possible when the “animal spirits” that Friedman conjures up come from the having rather than the being mode of human existence.