Economics with a Moral Compass

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Antara MurshedAntara Murshed is a senior environmental science major.
Response to Andrew Menzer

Last week, an editorial was published discussing the eventual erasure of the middle class and the prioritization of empiricism over morality as a solution to the income inequality problem. The problem of economic inequality is one that absolutely needs to be addressed. However, properly addressing this issue is a very complex process and requires much further analysis beyond defining what wealth is and asserting that the value of a human being is solely based on what they have to offer to the free market. In America, there are always going to be certain prevailing economic issues. Popular recurring topics regarding economics that always elicit discussion during election season include immigration, job creation, taxation, poverty, and pervasive income inequality.

In last week’s editorial, the author argues that only a very small percentage of the population actually has the ability or the resources to create services or goods and it is up to that select, small group of people to create meet consumer demand to create economic prosperity for all. This description is reminiscent of the theory of trickle down economics. In theory, assigning the responsibility of the entire United States economy to a rather small and very affluent part of our population may sound like a plausible way to run things. The assumption that investing more capital among the wealthy and the elite will result in more jobs for those with lower income and benefits for society as a whole is a well intentioned assumption. However, there is a considerable amount of evidence that this economic approach does not effectively address the issue of income inequality. The International Monetary Fund, a finance organization which surveilles global economies, published a report in June of this year which states that “increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth—that is, when the rich get richer, benefits do not trickle down.” Therefore, designating investments among a small, wealthy percent of the population is not an effective way to amend income inequality. This approach seems to fight income inequality, by creating more income inequality, which does not seem entirely productive if our goals are the same.

 

When one makes the argument that only the wealthiest one percent of the population is able to perform in professions that are considered valuable to the economy and that the remaining 99 percent of people inherently lack the ability to perform in those professions, then there is an assumption that needs to be addressed. Classifying people in this manner implies that people do not have value outside of what they can offer to the free market. The author from last week suggested that journalists and bloggers who turn dialogue towards the poor and find blame in corporate America should be ignored. The author goes on to explain that they should be ignored because the work of the journalists and bloggers are not valued enough by the free market, and if they were valued more they would not have so much issue with corporations, which are valued by the free market. The author asserts that morality should be set aside for empiricism, in the sphere of economics.

 

Empiricism is a very important aspect of acquiring knowledge from experimental science, but to use empiricism as a replacement for morality does not seem like an equivalent replacement. Why is empirical evidence considered mutually exclusive of a moral derived analysis on the same issue?  It is possible to be scientific about an issue and still maintain a human perspective on a topic. Economic issues like income inequality, widely affect all members of our nation’s population. Because economic issues affect everyone, they cannot solely be solved by societally isolated, incredibly wealthy people who only think about how the free market will respond to socio-economic issues that affect the livelihoods of millions of people. That is simply not realistic. Economics is the science concerned with the production, consumption, and transfer of wealth. This means that there are real people who are involved with the processes of producing, consuming, and transferring wealth. And all of these people have different ideas about what is considered to be right and wrong about economic processes, from moral and empirical standpoints. Saying that morality does not belong in a science that was created solely from the interactions of wealth between human beings is a very wrong oversimplification of the issue.

Pull Quote/// im not sure you’ll need it

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