Is socialism morally justified

Ethical Justification of Modern Capitalism - A Contradiction?

Table of Contents

1 Introduction ..

2. Definitions and demarcations
2.1. Ethical justification
2.2. Modern capitalism

3. Axioms and Paradigms
3.1. The meaning of axioms and paradigms
3.2. Axioms and Philosophical Supports of Capitalism
3.2.1. Teleology
3.2.2. Utilitarianism
3.2.3. The empiricism
3.2.4. The individualism
3.2.5. The contract theory
3.3. My own axioms

4. The historical development of capitalism
4.1. Classic capitalism
4.2. Depression and Unions
4.3. Keynesianism
4.4. Monetarism
4.5. globalization
4.6. Two alternatives to neo-liberal capitalism
4.6.1. Socialism
4.6.2. The social market economy

5. The social significance of capitalism

6. The individual in capitalism

7. Ethical criticism of capitalism within its paradigm
7.1. Moral laws of nature
7.2. Mechanistic functioning
7.3. The importance of man
7.4. Control by people
7.5. Infiltration into society and science

8. Ethical criticism of capitalism outside its paradigm
8.1. The true nature of man
8.2. The human being as a social being
8.3. Utility functions
8.4. Prosperity criteria
8.5. The prisoner's dilemma
8.6. Distributive justice
8.7. Product diversity and waste of resources

9. Ethical justification of modern capitalism
9.1. Subsystem of society
9.2. Freedom system
9.3. Ethics in Capitalism
9.4. The influence of the state
9.5. Capitalism and morality

10. Conclusion

bibliography

Abstract

The main purposes of an economic system are the efficient use of the resources that are available to a society, as well as the fair distribution of the generated social product, whereby the distribution can be left to the internal mechanism or consciously controlled by external intervention. However, these two main goals can only be implemented in harmony with the overarching goals of a society, since the economic sphere of life only covers part of the social spectrum. There have always been tendencies to ideologize economic models and to extend the methods used to other areas of society. Capitalism is no exception. Proponents of the market economy often extend their principles to non-economic areas of society and assign them general validity under natural law. Capitalism is mainly justified with the arguments of natural law, conceptual simplicity and reality. It is argued that its mechanisms correspond to those of nature and that humans should therefore only intervene to a limited extent, even if they have distinct possibilities to do so. Despite this view, enormous demands are made on capitalism, because it is ideologically very close to the modern, individualistic idea of ​​freedom. One sees a close connection between capitalist development and the development of modern, liberal social systems. Both concepts are based on the common axiom of the individual freedom of every human being. Beyond individualism, the market economy represents an image of man that does not correspond to the widespread notion of a good, moral person. Nevertheless, this picture is generally accepted in the economic context. Capitalist philosophy contains further contradictions and logical ambiguities. Nevertheless, capitalism has proven itself in reality, and it has shown that it is compatible with the principle of individual freedom and has actually served it to the greatest possible extent. Nevertheless, a continuous questioning and further development of capitalist ideas must be maintained, since the weaknesses of the market economy cannot be overlooked and there are certainly opportunities for improvement. In addition, society is developing continuously, and accordingly its needs and beliefs change over time. Nevertheless, it will probably not be possible to develop an economic model that is endorsed by all people, since the represented human image and the resulting understanding of justice are of great importance for the evaluation of the system, and there will always be different views.

1 Introduction

At the beginning of the 21st century, the global triumph of the capitalist economic model can no longer be denied. Feasible alternatives to capitalism are rarely seriously considered politically in the western world. The collapse of the Warsaw Pact and the underlying socialist ideology has placed the market economy in a lonely, unrivaled position. The economies of the former socialist countries have since adopted market economy principles to varying degrees and the previously numerous critical voices opposing capitalism are usually hardly represented in the legislative and executive bodies of politics. Is this development to be welcomed or is it rather to be feared that the decreasing questioning of the market economy will also find less and less attention in the future? Will there be a long-term readiness to deal with alternative ways of meeting the material needs of societies or will this task be left to the already numerous militant, globally organized fringe groups and economic philosophy? That would be regrettable, since this development would lead to an increasingly arrogant self-understanding of capitalist ideas, all the more because the weaknesses of capitalism are obvious. Distributional injustices, market failures, externalities, are just a few examples of economic challenges that the market mechanism alone cannot solve satisfactorily. These facts are usually admitted by advocates of the market economy, but are at the same time accepted on the grounds that capitalism is the most realistic economic model for human conditions. Furthermore, it enabled and promoted an unprecedented development of the sciences as well as a continuously increasing material prosperity. The first reason shows the importance of the human image on which this criticism is based. A conscious and clear basic conviction about human characteristics is essential for such considerations and discussions. The second argument cannot be denied as a fact, but is it satisfactory? Could wealth and science have developed in such a positive way without capitalism? And can this very unevenly distributed wealth in the world suffice as a justification? Isn't that a very one-sided assessment of social development? Isn't there also the danger here that we, who live in a capitalist system and may have been shaped by it, apply the criteria for evaluation that are emphasized by the market economy and are thus in a hermeneutical circle? Despite the success of capitalism, there is currently no consensus about its superiority over other economic models. Apart from the few non-capitalist countries (Cuba, North Korea, ...), there are parliamentary minorities in numerous capitalist democracies who continue to passionately point out the deficits of the market economy. Even in the academic and philosophical world there is by no means a consensus on the superiority of capitalism. The recent demonstrations against the unrestrained geographical and social expansion of the market economy and the resulting globalization on important and exposed international occasions (Seattle, Davos, ...) also indicate increasing dissatisfaction among at least individual, but internationally organized, groups down. They lament the enormous differences in prosperity around the world, the increasing alienation of people from one another and the neglect of non-human existence as well as the obvious inability of politics to include future generations in the economic calculation. Proponents of capitalism continue to argue with the historically parallel development of individual freedom and economic liberalism. The consistent implementation of market economy principles is not compatible with a dictatorial policy in the long term. Incidentally, capitalism's realistic image of man guarantees an economic model that is not perfect, but nevertheless human-friendly and can be implemented in reality, which is significantly better than an idealistic, non-implementable concept. It is nevertheless interesting to observe that the term "capitalist" has an apparently pejorative connotation and that some market-minded people would not call themselves capitalists. One can dare to claim that the capitalist ideology advances with less success than the corresponding economic model. One possible explanation for this is that the underlying image of man and the inevitably resulting understanding of human interactions in the eyes of many people corresponds to the existing conditions, but does not correspond to the image of a good person prevailing in most cultures and religions. This would mean that in the eyes of these people there is a discrepancy between what is and what is desired (ought). This consideration can justify a normative restriction of individual human freedom in economic life, against which liberalists speak out. If we humans do not meet our own standards of humanity, shouldn't we look for a way to live up to this idea, even if this involves a degree of restriction of freedom? The laissez-faire principle can only work if people, despite their fallacies, are capable of consciously not acting egotistically in certain situations. Otherwise this principle would undermine itself, since the individual idea of ​​freedom on which it is based could not be sustained in the long term. Unbridled, reckless, non-respecting behavior produces bondage and removes the freedom that originally made this behavior possible.

2. Definitions and demarcations

Concepts developed by humans have no objective meaning, they are understood against the background of the experiences and ideas of each individual. In order to reduce the possibility of misunderstandings, it is therefore useful to explain the terms used in the task, as I understand them, in a hermeneutic sense. This gives the reader the opportunity to understand the thought processes based on these terms more precisely.

2.1. Ethical justification

Ethics is the science of morality. It examines which conditions have to be fulfilled in order for an action to be described as good. Action can only receive this unconditional evaluation if it is conducive to the achievement of a greatest good for humanity. The individual freedom of the human being is often regarded as this highest good that needs no justification. However, this freedom inevitably implies that each person can decide autonomously whether they want to agree to this view. If one subscribes to this line of argument, it must be accepted that all actions that promote this freedom are good per se. I share this widespread view. However, this is only partially because it does not seem to me to be extensive enough. It does not include future generations, nor does it take into account the rights of non-human living beings, fellow creatures who, in my opinion, also have rights worthy of protection. Since the animal and plant worlds cannot represent their interests themselves, man has to include them in his ethical considerations. Some philosophers go a step further by giving rights to non-living creation[1]. This philosophy, on the other hand, is difficult to understand for my understanding, since the combination of non-organic existence and law cannot be derived. I will therefore examine capitalism from the perspective of whether it does justice to the free rights of living and future living beings. A decisive criterion for ethical studies of the market economy is the differentiation between teleological and deontological positions. The capitalist system, even if it partially negates the need for ethics, favors the teleological school of thought. Action that fulfills its predetermined purpose is more valuable than one that fails to achieve its goal. On the contrary, the deontological view places the emphasis on the standard on which action is based, which is more important than the result ultimately achieved.

2.2. Modern capitalism

Capitalism is an economic model, a form of economic organization based on exchange between free, self-interested individuals. Although there are different forms of the market economy, this economic system, according to Koslowski, has three essential characteristics that distinguish it from other economic systems: private control over the means of production; Market and price mechanism as a means of coordination; Profit and benefit maximization as an essential motivation of the economy.[2] Nell-Breuning, on the other hand, defines capitalism from the perspective of ownership of the factors of production and writes: “That is why I have called the economy“ capitalist ”in which capital and labor depend on each other in such a way that they are two different groups of people whose one (only) capital and the other (only) labor, whereby the economic process as a whole is organized and directed by those who employ the capital. "[3] In the following, the term “market economy” is used as a synonym for capitalism. The main reason for this is that capitalism is actually to be seen as an economic model and not as a social system, even if it has a strong influence on the non-economic way of life of the society practicing it. There are different ways to define the term “modern capitalism”. This can be understood, for example, as Keynesianism, which was widespread after the Second World War. This is a form of market economy that has recognized the weaknesses of self-regulation theory and advocates an active, counter-cyclical economic policy. Monetarism, made famous in the 1970s by Milton Friedman, can also serve as another possible synonym for “modern capitalism”. Monetarism advocates a return to the state's abstention from active economic policy. The main task of governments is seen to be ensuring an economically fertile environment so that entrepreneurs are able to plan effectively and non-productive market frictions are minimized. One of the most important prerequisites for this is a low and steady inflation rate. Active government intervention in the private sector is detrimental to monetarists, as this may make it more difficult to obtain capital for business investments. Furthermore, monetarists, especially Milton Friedman, take a concrete position on the need for moral action on the part of private companies. Moral action that is not legally required (a tautological expression from a Kantian perspective) is in the truest sense immoral, since it puts the moral company in a competitive position vis-à-vis its competitors and thus endangers the capital invested by shareholders. Stockholders buy shares in companies that they believe will be successful in the marketplace. Moral action on the part of companies is not required by law, leads to an increase in costs and is thus fraud against the shareholder. Another possible definition for “modern capitalism” can be the globalization, which has been advancing strongly since the 1990s, with its side effects. Numerous financially strong, multinational companies have been represented around the world since the successive opening of many markets in recent years. This development has given rise to numerous new ethical problems. For example, exporting profits from third world countries poses a challenge. The increasing deterioration in terms of trade for third world countries has also led to strong international frictions. Since “modern capitalism” can be defined in the most varied of ways, I will deal with the three mentioned developments in the following explanations.

3. Axioms and Paradigms

3.1. The meaning of axioms and paradigms

Axioms are basic certainties with which all further beliefs of a person must be compatible in order to build up logical thought structures that are developed into paradigms. Beliefs that cannot be further reduced, often shape the personality of a person because they strongly influence his general worldview and his specific views on certain topics. Amitai Etzioni described paradigms as follows:

“The prevailing paradigms don't just define what is believed to be true. The criteria by which such claims are evaluated are also strictly subjective or part of one's own paradigm. The way of thinking of the Marxists, psychologists and neoclassical economists only appear logical to us if we acquire their basic assumptions and their evaluation systems. "[4]

Since axioms and paradigms are highly internalized, they are seldom questioned by the wearer and, when attacked by another person, are often defended with passion. They can come about in a number of ways. Often they arise gradually through upbringing, life experience, culture, education, ... and are internalized in an unconscious way. Sometimes you are consciously accepted through introspection. René Descartes is a well-known example of a philosopher who, in adulthood, consciously abandoned all inherited beliefs in order to arrive at unshakable certainties through intense contemplation and reflection. His only resulting axiom was the absolute certainty that his mind existed, and consequently he was. Hence his famous phrase "I think therefore I am."[5] Descartes then based all his thinking on this single, original axiom. Another very common source of axioms is religion. In discussions and treatises, especially those of the philosophical kind that deal with profound and fundamental thoughts, it makes sense to enlighten the audience or readership from the outset about your own axioms. This has the advantage that the arguments can be better understood from the perspective of the presenter. In addition, disputes are often conducted on a higher level, although the differences can be traced back to different axioms. Reaching a consensus is therefore very unlikely, as this would require a change in the axioms of one of the interlocutors. A match can be complete or partial: On the one hand, the axioms of the interlocutor can be shared and the logic of the chain of arguments can be understood. This creates a perfect match between interlocutors. Even if the axioms (premises) are not agreed, it is still possible to recognize a logical argument. This leaves a partial match. A discussion of the Christian religion between a Christian and an atheist can serve as an example. Even if the atheist may not agree with the Christian's axioms, he can still put himself in the position of his thinking if it is logically based on these premises. Another possibility of partial agreement is based on common axioms, with a subsequent difference in the logic of the thought framework built on these premises. Philosophy offers numerous examples of rationalist schools of thought, which are based on originally common views, in order to then argue differently logically. A clear distinction between the different types of agreement is very important in order to be able to recognize possible differences within a discussion more easily and to be able to start the argument in the right place.

3.2. Axioms and Philosophical Supports of Capitalism

The axioms of capitalism can partly be traced back to its intellectual prehistory, since it was developed over time according to numerous philosophical concepts. The founders of the market economy were influenced by these concepts and built their own theories on them.

3.2.1. Teleology

This philosophical doctrine is an important foundation for capitalism. It says that all events, including human actions, are directed towards a certain positive goal (telos). This theory assigns a meaning to all events, it is irrelevant whether this meaning is known or not. Teleology is very important for the ethical justification of actions and systems of rules, since the intended goal can be subjected to an ethical review and the affected action can be evaluated from an ethical point of view. Since, according to capitalist theory, man always acts in his own interest, he is inevitably aware of the goals of his actions in this sense. Teleology has had a profound influence on the development of Western societies, and it is conceivable that it has further increased man's natural tendency to find an explanation for all natural conditions.

3.2.2. Utilitarianism

This philosophical view also had a decisive influence on capitalist development. This is about bringing about happiness for mankind as a moral evaluation criterion for actions. The clearly formulated goal of utilitarianism is "the greatest possible happiness for the greatest possible number of people". Building on this position, Adam Smith developed the concept of the "invisible hand". Self-interested actors compete against each other in the market without the interference of state authorities, which inevitably leads to an optimal allocation of resources, and the prosperity and happiness of society are maximized. The implementation of the utilitarian maxim has always turned out to be problematic, since the effects and results of individual actions can rarely be fully anticipated. Furthermore, the question of justice has always raised great problems in utilitarianism. Can great suffering for a single individual be justified by the benefit of a multitude of people? How are the claims of nature to be considered in this philosophy? In order to simplify the application of utilitarianism, rule utilitarianism was proposed, which deals with the development of general rules of action that maximize happiness, rather than subjecting each individual action to a utilitarian review. Utilitarianism has strongly shaped contemporary thinking, and today political, legal, and economic decisions are often made according to utilitarian standards.

3.2.3. The empiricism

Empiricism says that all knowledge is derived from sensory perception. In contrast to rationalism, which gives reason and a priori knowledge a higher weighting than sensory experience, empiricism only assigns a synthesizing function to reason. Capitalism is built on an empirical view; it allows comparatively few a priori norms. Proponents of the market economy point to the actually observed behavior of Homo Oeconomicus and reject social systems that claim to bring about behavioral changes in people. The knowledge gained in reality is used as a yardstick, and the typifying statement that people act with self-interest is derived from the observational experience. As a justification for the market economy, the empirical arguments of reality, the creation of material wealth and the continued existence of capitalism for two and a half centuries are often used.

3.2.4. The individualism

Individualism has decisively shaped capitalism and the Western understanding of freedom by making people the starting point of the hierarchy of values, emphasizing their individual freedom. All individualistic thinking and acting is based on human freedom, because it is the last good of free societies that no longer requires justification. Subsystems of such societies, such as capitalism, require morality, since the individual is left with great scope for decision-making in many situations. This fact is often denied in capitalist theory. In the event of a conflict of interest, individualistic morality gives people the opportunity to consider the freedom of their fellow human beings and fellow creatures within their various options and to decide accordingly. This gives the citizen more responsibility for his or her actions. Very individualistically minded societies such as in the Anglo-Saxon countries illustrate this focus on individual responsibility by letting social influences apply less to criminal offenses or poor living conditions than is the case, for example, in Western Europe, where individualism is less pronounced.

3.2.5. The contract theory

This theory of justice, coined by Thomas Hobbes, states that people within a community, because of mutual interactions, enter into implicit contracts with their fellow men that are of benefit to the general public. In his remarks he goes back to an original, lawless state of nature in which every person is in full possession of his natural freedoms. This original state does not offer the individual any security, since he has to constantly fear the prevailing arbitrariness. Contract theory advocates the thesis that people are ready to accept restrictions in their freedom if, in principle, everyone is granted an equal right to fundamental freedoms and, if they are among the least favored in the system sought, they obtain the greatest possible advantage. Thomas Hobbes writes about this: "[...] because it is a true union in one person and is based on the contract of everyone with everyone, as if everyone said to everyone:" I hand over my right to rule myself , this person or this society on the condition that you also cede your rights over yourself to him or her "In this way, all individuals become one person and are called a state or community."[6] The contract theory is a derivative of utilitarianism and has shaped capitalist thinking, because the market economy allows people in principle full contractual capacity and the system is based on the observance of concluded contracts. In a concluded private contract, the citizen voluntarily enters into a current or future restriction of freedom, as he expects an economic advantage from it.

3.3. My own axioms

It seems to me necessary, before my actual project to ethically justify capitalism, to present my axioms. This knowledge will make it easier for the reader to access my framework of thoughts and show the level of a possible dissent. My main axiom, as indicated earlier, is the belief that the human mind is free per se. He cannot be hindered in his thought activity by any conscious external force. He makes his own rules and follows them at will. This freedom enables people to realize themselves spiritually independently and according to their own ideas. However, in order to be able to fully implement his freedom and not to endanger this basic principle, the citizen must inevitably affirm the same freedom of other people. A view that affirms one's own freedom and denies theirs to fellow human beings is neither logical nor sustainable in the long term. According to Baruch de Spinoza, this basic attitude is an important characteristic of a reasonable person: “It follows from this that people who allow themselves to be governed by reason, that is, people who seek their benefit under the guidance of reason, do not ask for anything for themselves that they do not also desire for other people, and that they are therefore just, loyal and honorable. "[7] The mind is sustained by its instinct for self-preservation, but is dependent on the human body. The existence of the individual mind can only be sustained by preserving the organism belonging to it. If a body dies, the function of the corresponding spirit ceases with it. The body, on the other hand, has specific needs that have to be satisfied in order to be able to live. There are two interfaces to fellow human beings: On the one hand, some needs and wishes can only be implemented in harmony with other people, on the other hand, some of these needs and wishes have to fall back on limited resources, which are in principle available to all people and other living beings. This reliance on other people requires continuous interaction and negotiation between them in order to reach consensus. This is a prerequisite so that the principle of freedom is not called into question. Since no defense of their interests can be expected from the non-human living beings, the human being, as the most spiritually developed living being, has to take these needs into account. This fact demands that the free spirit, in order to affirm its freedom, must equally affirm the freedom of its fellow creatures in order not to be contradicting itself. The implementation of this maxim is made difficult by the fact that Homo sapiens are in fact mainly, if not exclusively, guided by their self-interest. Most decision-making situations show that people keep putting their own benefit in the foreground. Market economists use this quality to explain and justify a variety of capitalist laws and principles. For some extremely minded capitalists, this quality is the only truly predictable human quality that affects all action. Sometimes these explanations take tautological forms. Actions that appear selfless at first sight are explained with the satisfaction of a deeper need. Altruism is negated. For example, those who donate a sum of money to a charitable organization feel a certain satisfaction that can be interpreted as a reward. If this positive feeling were not to be expected, this person would not donate. For representatives of other images of man, this results in a very one-sided picture of humanity. I share this view. Selfishness is likely to explain a wide variety of human behaviors, but does not cover all of them. Occasionally people also have the need to do “good” without expecting any material or spiritual benefit. Such actions are good per se, the result obtained is secondary. Love, compassion, empathy, etc. ... cannot be explained in a satisfactory way with self-interest, so social concepts that only rely on this characteristic are not comprehensive enough. Furthermore, ethical concepts that focus on the freedom and needs of the present living creation are not comprehensive enough because they do not take into account the rights of future generations.

4. The historical development of capitalism

There were always normative expectations of the state to behave in a certain way, be it just to stay out of the market as far as possible in order to be able to guarantee the best possible trading conditions. Others expect governments to pursue active economic policies because they want to see that the market economy cannot achieve optimal results in all situations. The period when the state intervened least in the market mechanism was the period from the end of the 18th to the second half of the 19th century. That was the time of mercantilism, when governments focused on achieving a positive trade balance in order to strengthen their own country. Although there were already prominent critics of the unbridled market economy at the time, the state largely stayed out of private-sector affairs. The further the industrial revolution advanced, the more the devastating effects of unbridled capitalism became apparent.

4.1. Classic capitalism

Classical capitalism is usually associated with the teaching of Adam Smith ’. Before Adam Smith, utilitarian philosophers in particular had paved the way of thinking for the market economy. Characteristic of capitalism are, on the one hand, the extreme increases in productivity through the division of labor and the resulting economies of scale as well as the short-term self-regulating properties of the market left to its own devices. Adam Smith theorized that although the individual is focused only on his own interests, the interaction of a multitude of these self-interests produces results that correspond to the social interest. This result is achieved above all through efficient production and a corresponding budget of the scarce resources as well as an optimal distribution of the production result according to the principle of economic contribution and willingness to pay. Interference by the state was thus viewed as harmful, as the optimum could no longer be achieved. The result that was consciously brought about must therefore inevitably be suboptimal. This phenomenon of uncontrolled congruence between individual and social interests is interesting because it takes on the status of a mechanistic law of nature. A conscious human intervention in this process is not considered necessary.However, Adam Smith has already admitted areas in which market efficiency fails: in the case of public goods and externalities, for example, intervention outside the market is necessary. For this reason, some degree of state influence was seen as inevitable despite everything. After Smith, David Ricardo is seen as another great classic proponent of capitalism. He advocated the elimination of trade restrictions between nations so that every country can exploit and expand its competitive advantages, and, just as every market participant benefits from free action on the national market, every nation also benefits from free action on the international market Level. This theory has regained importance especially in the last two decades with regard to globalization and regional domestic markets.

4.2. Depression and Unions

The devastating social effects of early capitalism were already evident at the beginning of the 19th century. The living and working conditions of the working class families were inhumane. Very long working days, child labor and low wages were the order of the day and a large part of the population barely got above the subsistence level. In addition, factory workers were exposed to severe economic cycles and could often be dismissed at will because they had no protection against dismissal. Entrepreneurs took advantage of their barely restricted options, entirely in accordance with the principle of self-interest. Because of these extreme developments, trade unions were allowed to provide a power counterpart to industry's monopoly on supply in the labor market. The unions fought for substantial concessions for their members. Already at that time it was recognized that capitalism could not be completely left to its own devices. Above all, it became clear that the situation achieved was difficult to reconcile with the ideals of utilitarianism, since prosperity was distributed among an absolute minority and the vast majority lived in poor conditions. The first great disillusion of the capitalist-minded philosophers related to the unsatisfactory distribution of wealth.

4.3. Keynesianism

The second great disillusion came at the beginning of the 20th century, when the theory of the continuous tendency towards market equilibrium did not come true. The major economies were exposed to considerable cycles and showed little stability. The great depression of the 1920s and the resulting long-term unemployment and poverty showed that the propagated inherent stability of the capitalist economy did not correspond to reality. John Maynard Keynes developed a theory according to which capitalism develops in cycles, since suppliers and buyers assume different facts and do not plan in the same time periods. The effects of the saving behavior of the population in economically strong times were also examined. Keynesian-influenced capitalism says that the state must not only act as an overseer in the economy, but also as an active stabilizer. Above all, it does this by reducing the effects of economic cycles. If, for example, private demand is too weak in a recession, the state steps in as an alternative consumer by pursuing an active debt policy. Thus, the level of demand is falling to a lesser extent. If private demand rises again, the state withdraws and uses the resulting increased tax revenue to balance the budget deficit and reduce the national debt. Keynesians are so-called demand economists, as they believe that demand is a major driver of the economy, in contrast to monetarists (supply economists), who focus on the supply side and tend to favor tax cuts in recessions to stimulate the economy through entrepreneurial investment. Keynesians hoped that the active economic policies of the governments would smooth out the cycles. Keynesianism was particularly popular after World War II and into the 1970s when a previously unknown phenomenon appeared. Economic stagnation and inflation appeared at the same time. This was difficult to explain for Keynesians, as both phenomena could not actually occur at the same time. Economic stagnation was traditionally associated with price stability or even deflation, because at these times the demand for goods and the labor market was weaker, so there was less pressure on prices and wages. The 1970s brought forth a very individualistic theory that rivaled Keynesianism.

4.4. Monetarism

Monetarism is based on the classic capitalist view that government action on the private goods market has, in principle, harmful effects. This view was explained in monetarist terms, in the sense that the state, through its investments in the private sector, has a negative influence on the availability of capital (crowding-out effect). This has increasing effects on the interest rate level and suppresses private investment initiatives, since fewer projects can be realized economically according to the discounting principle. After adjusting for some time, investors would factor in estimated inflation, which in turn drives inflation further. Instead of influencing the economy through active, controlling economic policy, the state should see its main task in curbing the inflationary tendencies of money and only allowing slow and, above all, continuous price increases. This enables investors to plan effectively and reduces their risk. One recognizes here an ideological return in the direction of the laissez-faire principle and to the mechanistic natural laws of the market. The numerous individual actions of the entrepreneurs work with and against each other on the market in order to achieve a socially optimal economic result. The role of governments is again reduced to ensuring optimal trading conditions. The best-known advocate of monetarism, Milton Friedman, believes that the main task of the state in the economic field is the creation of laws that facilitate the movement of goods and services. These laws alone are binding on the entrepreneur. The entrepreneur should follow these laws and focus on increasing the wealth of shareholders (shareholder value). Moral behavior on the part of the company management is economically undesirable because it puts this company in an unfavorable position compared to less morally committed competitors and thus endangers the survival of the company. This is a fraud against the shareholder, as his mission to the management is clearly to achieve the highest possible return on investment. Furthermore, the unemployment resulting from a possible bankruptcy is immoral if the bankruptcy was brought about by inappropriate, moral actions on the part of the company management. Nevertheless, despite all the laissez-faire statements, a duty of the state is again recognizable in monetarism, namely to keep the monetary value stable. Here it becomes clear again that the economy cannot do without normative specifications, whatever shape they take.

4.5. globalization

What began slowly with the expansion of multinational companies after the Second World War continued into the 80s and especially into the 90s of the 20th century. US American, European and Japanese companies in particular recognized flattening sales increases and saturation phenomena in their home markets and began to expand abroad. An expansion into the economically also highly developed world hardly results in ethical problems, since the host countries are legally able to represent their interests and to negotiate as equal partners with the companies. You are not dependent on the investment activities of multinational corporations. In addition, the phenomenon of profit exports is not a major problem. Far more difficulties arise when these companies establish themselves in second and third world countries whose gross national product is in some cases lower than the group turnover. On the one hand, these corporations create much-needed jobs and can thus obtain considerable concessions from these countries, on the other hand, profits are often not re-invested in the same country itself but transferred to the home country. Intra-group transactions are designed in such a way that profits are relatively low in high-tax countries and arise in low-tax countries. This harms third world countries proportionally more than highly developed nations. In addition, it is often criticized that only less demanding activities are relocated to third world countries, expert work remains in the home country, so these third world countries hardly developed any further in the area of ​​human capital (know-how). Defenders of this state of affairs point out that this situation still supports the third world countries on their way to economic development, since unemployment is reduced and the gross national product is increased. This means that more can be invested in infrastructure and training from the country side. Opponents respond that the gap between rich and poor countries is widening, partly because of such developments.

4.6. Two alternatives to neo-liberal capitalism

Since its inception, capitalism has had to accept critical dissenting voices. Particular emphasis is placed on the one-sidedness of capitalist theory, which transfers the axiom of individual self-interest and the economic principles based on it to various areas of society. For example, capitalist-minded social scientists have tried to explain the institution of marriage and childbearing with economic arguments. Alternative economic models have in common that comparatively more normative elements will flow into economic life than under capitalism, so that a smaller proportion is left to the supposedly mechanistic effects.

4.6.1. Socialism

Socialism has different priorities than capitalism. The individualism, which is important in capitalism, and the numerous economic opportunities for individual realization are largely sacrificed in favor of a strongly controlled economic policy oriented towards the needs of society as a whole. The possibility of private property, especially of the factors of production, is drastically reduced. An important distinguishing feature from the market economy is the understanding of justice. In the distribution of wealth, far more value is placed on the needs of each individual than in capitalism, where the individual contribution to the national product is in the foreground. Hence the socialist goal of eliminating classes within society, since the corresponding positions within society are usually inherited and the class differences tend to solidify over time. Marxist-minded socialists reject a cross-societal and cross-generational morality, rather they take the view that the current social conditions have a decisive influence on morality. This is how Marx's colleague Friedrich Engels wrote:

"We claim (against) that all previous moral theory is the product, in the last instance, of the economic social situation at any given time." [...] "So we can only draw the conclusion that people, consciously or unconsciously, reflect their moral views in the last instance draw from the practical conditions in which their class situation is based. "[8]

An important difference to market economy-oriented philosophers is the conviction that the current conditions can in no way justify the existing social system, since they influence the criteria of the evaluation. Socialists also do not believe in the efficient mechanism of the market and consider it more sensible to plan production centrally. For this, a restriction of the human development possibilities is accepted. Humane egoism is not denied, but it is believed that if left unchecked, it will lead to the economic and social oppression of the masses. This is why socialist ideology claims to re-educate people, a task that the state takes on. In contrast to capitalism, which takes human characteristics as a starting point in order to adapt the system to these conditions, socialism tries to shape people in such a way that they correspond to the normative image of man.

4.6.2. The social market economy

This model, which is mainly used in Northern and Western Europe, tries to counteract the effects of unrestrained capitalism while preserving the freedom of the individual. Although the social market economy takes different forms in the different countries in which it is practiced, there are some common features. The German post-war model is traditionally understood as a social market economy, but the Scandinavian model of the 1970s can also be described as such. Nevertheless, the social market economy is more of a modification of capitalism than an independent economic system. Compared to liberal capitalism, the state has a greater control function. With social consensus, the right of employees to have a say in companies, a progressive tax system and subsequent broad dispersion of tax revenues on the part of the state, etc. ... the aim is to achieve a fair distribution of prosperity through both the contribution to the national product and the individual need of the individual in distribution is taken into account.

5. The social significance of capitalism

Capitalism is not a social system but an economic model, this fact is often overlooked. Accordingly, according to Koslowski, its main purpose is to ensure an economically efficient and fair production and distribution of goods and services: “The economy is the doctrine of the efficient pursuit of given purposes. It is a doctrine of the right means and therefore cannot give conclusive information on the question of what we should want, what reasonable ends are. The concept of economic efficiency as a maxim for action cannot relieve the individual of the choice between purposes and values. In order to decide what we actually want, we need rules of value implementation. "[9] The market economy is often viewed as a model of society. Their laws and solutions to problems are transferred to numerous other areas of life (science, culture, ...) and the market is made the measure of all things. As an economic concept, capitalism has so far been unsurpassed as it has proven that it has produced the most efficient, productive, creative and progressive outcomes of any system practiced to date. If the resources available in the world are viewed as scarce goods, wasting them can be viewed as immoral, as this makes life more difficult for future generations. Nevertheless, capitalism also shows a tendency to waste, especially of so-called public goods, since they have little or no market value for the individual. The strong marketing measures are also criticized because they do not produce any material benefit. Other economic models have not been able to solve the waste problem either, although experience has shown that they are higher in socialism than in the market economy. In the course of its history so far, capitalism has shown that its functioning corresponds very closely to the natural human characteristics. Although scientific progress over the past two centuries cannot be attributed to the existence of the market economy alone, it has made a major contribution to it. There was certainly a reciprocal influence of business and science, because the pressure to increase prosperity and profit maximization has promoted the inventive activities of researchers financially and ideally, especially in the field of applied research. New inventions, on the other hand, have repeatedly created economic opportunities for the private sector. Even if capitalism is a pure economic model, there are indications that its application has an influence on the inner workings of a society. For decades in advanced capitalist countries, especially in big cities, one can observe a stronger individualization of society. Social ties such as neighborhood, extended family circle, etc. ..., which were very important in pre-capitalist times, have lost their importance. The previously indicated expansion of economic principles to include non-economic areas of life is also becoming increasingly clear. Political decisions of relevance to society are often made according to economic criteria. However, this does not necessarily mean that these principles are by nature actually applicable to these areas. It is quite possible that the ongoing implementation of the market economy influenced society and political events in such a way that this expansion was made possible and later even promoted.The main question is as Etzioni poses it: “The people of Western societies strive for consumption and prosperity; but is this the case because they are inherently possessive or because they have been shaped by the values ​​of mature capitalism? "[10] In other words, is man by nature a Homo Oeconomicus or has he been made into one, or are both recorded?

6. The individual in capitalism

In capitalism, the individual is the measure of all things, so the market economy is in close harmony with today's Western democratic understanding of freedom. At the same time, people are seen as self-interested individuals. He would like to shape his life according to his own ideas and needs freedom of planning and action for this, which is why his opportunities for development are the focus. Nevertheless, in capitalist theory, the human being is viewed as an atomistic unit of demand, which only becomes economically significant when there is a critical mass of like-minded demanders. Individual wishes and needs are not marketable if they are not supported by a strong ability and willingness to pay and are therefore not taken into account. The fact that the principles of the market economy are based on individualism, but the rules of the system are geared towards the masses, represents an inherent contradiction. Only the masses, expressed in monetary units, can make a difference economically. Passion and commitment hardly count if the requirement of the minimum quantity is not met.

7. Ethical criticism of capitalism within its paradigm

Even if the supportive beliefs of liberal capitalism are accepted, this economic system offers several points of attack, since some justifying arguments and conclusions are contradicting itself.

7.1. Moral laws of nature

One of these contradictions relates to the natural law behavior of the market. People act teleologically, i.e. goal-oriented, in economic activity, but the economy as a whole is self-regulating and does not require any external intervention. Teleological management of the economy is superfluous and even harmful, since it prevents the optimal allocation of the resources available to man. Legislators should create the social framework so that the positive effects of the market economy can unfold. This means that the company management does not need to act beyond compliance with the law. When economic agents act in their own interest according to their nature, a morally good result is inevitable, since it has mechanistically achieved a fair distribution of resources and income. The logic of this argument is not obvious. Koslowski writes: "To believe that an economically efficient system already makes a good or moral society and that the economy is the whole of society is an economist fallacy."[11] The actions of self-motivated individuals, if they are aimed at maximizing their own benefit, cannot be good in a moral sense, they are extra-moral. This does not mean that they are necessarily morally bad, but morality in the event of a conflict of interest implies a degree of self-restraint in order to preserve the freedom of the present and future fellow creatures concerned. It is precisely this attitude that capitalism does not support, since the expected positive results are jeopardized under these circumstances. The result achieved, the mechanistically achieved distribution of wealth, cannot be regarded as morally good, as it was caused by numerous extra-moral actions and was therefore not intentionally brought about. Morality always presupposes a will.

7.2. Mechanistic functioning

The mechanistic functioning of the market, as it has already been described, is also questionable: economists have no test laboratory at their disposal in which they can empirically test their theories, analogous to their colleagues in other disciplines. The principle of the ceteris paribus clause is hardly applicable in economics, since the laboratory is, so to speak, in real life and is subject to continuous change. Accordingly, theses can hardly be fully scientifically verified or falsified unless so many auxiliary hypotheses are added that the entire underlying model becomes unrealistic. Etzioni explains this problem as follows: "Neoclassical economists often start with very few assumptions, but add numerous ad-hoc assumptions in the course of their attempts to reconcile their claims and the data."[12] Some economic constructions that are used over and over again do not appear in reality, but are used to illustrate how the market economy works. For example, the model of perfect competition has never appeared, so its real effects cannot be fully proven. Sometimes real conditions are deliberately left out in model constructions in order to clarify economic theories. This changes reality and the truth of the hypotheses involved can only be guessed at.

7.3. The importance of man

Another contradiction has already been indicated and concerns the position of the individual in the market economy. The single individual is at the beginning of all capitalist considerations, yet the functioning of the system is designed for the masses. Individual interests collide in the market, from which demand and supply forces are formed, which work with and against each other. Only marketable needs prevail without external intervention. Individual, marginal interests are not taken into account because they are lost in this model. Only wealthy individuals can assert their individual interests. As a result, culture and society run the risk of being unified. A phenomenon that can already be observed in western societies. Across countries, consumption and leisure behavior are becoming more and more similar. Young people in Europe hardly differ from their peers in Japan and North America. Koslowski describes this development as follows:

“Industrial mass production and mass purchasing power create an egalitarian tendency in capitalism, which is often overlooked with all attention to the inequalities of income distribution, a tendency towards the equalization of lifestyles despite all the inequality of wealth distribution. It means that the implementation of an individual consumption style is becoming more and more difficult compared to “average consumption”. This is in contrast to the fact that one of the important and correct arguments for capitalism is the fact that it enables individual lifestyles and ways of life to an extent that no other economic system allows. "[13]

The marketable gastronomy, clothing and entertainment concepts have prevailed. The individual loses its individuality, the conflicting interests in the market inevitably decrease. This development results in a market that functions more and more efficiently, and friction losses will decrease. This allows the assumption that man is shaped by the capitalist form of economic activity, a thought that is not permissible in theory, since given needs are assumed. If this interaction between people and the market actually exists and if diversity is a criterion for cultural wealth, one can speak of an impoverishment of culture. If cultural pluralism is a good that the world should strive for, this development requires concerted intervention by the state authorities at the national level and by the international community at the international level. Certain intellectual and material products as well as human interests, which cannot assert themselves on the market, have to be protected by the states.

7.4. Control by people

The classical capitalist theory recognizes the necessity, even if the state should intervene as little as possible in economic events, that the legitimate functioning of the economy must nevertheless be guaranteed and controlled? This task is assigned to the state legislative authority (legislature) and other bodies (judiciary, executive, cartel offices, ...). The premise that people are selfish and self-interested is a fundamental prerequisite for the market economy to function. Nevertheless, the question remains, by whom these control tasks should be carried out, if not by self-interested people. This problem becomes clear when governments make media-effective economic policy decisions before elections or when, as is common in the USA, they allow themselves to be influenced by strong interest groups (lobbyists). Capitalism does not give a satisfactory answer to how this problem can be solved. Although there is a system of separation of powers and permanent reciprocal control between state authorities, with the citizen taking on the ultimate control function with his right to vote, the factual result is not satisfactory due to numerous possible manipulations.

7.5. Infiltration into society and science

Capitalism accommodates the selfish nature of humans, and it remains questionable to what extent there is an interaction between humans and the system and how strong it is. It is entirely conceivable that the practice of the market economy has an impact on people's psyche. If you promote his self-interested behavior, there is a spiral, since the increasing economic thinking itself causes a further consolidation of the market economy. The key question is what proportion of Homo Oeconomicus is natural and what proportion has been reinforced by capitalism. It can be seen that society and science are strongly influenced by cost-benefit thinking. The pressure of market opportunities, for example, promotes applied research and makes it very difficult to maintain ethical barriers. The current discussion about human cloning makes it clear what tremendous pressure there is on scientists to keep developing in their fields of research. Even non-economic areas such as education, culture, etc. ... are increasingly subject to the laws of the market. This development puts social plurality at risk, as economic arguments come to the fore, other aspects lose their importance.

8. Ethical criticism of capitalism outside its paradigm If the basic assumptions of capitalist theory are rejected, further possible points of criticism arise.

8.1. The true nature of man

People keep showing that their actions are not driven by selfishness alone. There are a multitude of human actions that, at first glance, cannot be explained with self-interest. Love, compassion, neighborly help, etc. ... are behaviors that can certainly be traced back to other motives. It is quite conceivable that people feel the need to do good for their own sake. Some die-hard proponents of capitalism try to reduce all motives to the common denominator of selfishness. However, this intellectual balancing act is unconvincing and tautological. However, there is no need to take an extreme position on this question. It can be argued that the majority of human behaviors have a selfish purpose, but that motive does not explain all actions. If man also has a need to do good, it means that he has a moral inclination. This gives a more holistic picture of man that must be integrated into capitalist theory. A theory that sees egoism as the sole motive for human behavior does not do justice to the complex nature of man.

8.2. The human being as a social being

The theory of the market economy does not take sufficient account of the fact that man is a social being. Based on the previous chapter, capitalism takes the view that this is only true as long as the social environment serves the self-interest of the individual. This is a tautological explanation, because if people value functioning social relationships, they are inevitably prepared to invest in them without making direct cost-benefit considerations. This need for social interaction cannot be expressed in terms of market demand and supply functions. Numerous scientific studies have shown that humans are not viable without social ties, so they have no choice in this regard.

8.3. Utility functions

The utilitarianism underlying capitalism assumes that the norm of action of maximizing happiness is applicable to the greatest possible number of people. This implies that the result can be measured. Apart from the fact that this project is very difficult to put into practice, it is overlooked that feelings of happiness are relative over time and intersubjectively. Etzioni describes this phenomenon as follows:

“Within each country, however, the higher the relative income, the happier the individuals who are relatively better off. These phenomena can be explained by the fact that reference groups are mostly limited to the nations and do not have an effect beyond national borders. Easterlin's results are further supported by Duncan (1975): In Detroit, no particular increase in happiness was found in a group of test persons whose real income rose by 42 between 1955 and 1971, because the income of the reference group had increased exactly as that of the reference group Test subjects. "[14]

A difficulty arises here that makes capitalism and utilitarianism incompatible, since people communicate the expected marginal happiness gain (benefit) of a good with willingness to pay in economic activity. However, it must be taken into account that a warm meal is likely to bring more happiness to a very poor person than an additional luxury car to a millionaires. Nevertheless, the millionaire will be able to fulfill his wish and influence luxury car production. The penniless person, on the other hand, will not be able to do this, because although he has the potential to pay for the food, he cannot support this financially. In this respect, his need fizzles out on the market. From a utilitarian point of view, the result of this fact does not maximize happiness; according to capitalist criteria, it is optimal. The distribution of wealth is problematic for both capitalism and utilitarianism. Added to this is the utilitarian difficulty of acting according to the maxim of maximizing happiness for the highest possible number of people. Although the distinction made by John Rawls between rule utilitarianism and action utilitarianism has simplified this project, the concrete procedure remains indefinable.[15]

8.4. Prosperity criteria

The prosperity of a society cannot be assessed solely on the basis of material criteria. Capitalists determine social progress according to the development of national income, a very one-sided assessment. While this quantity is an indicator, it is not enough to measure a nation's real wealth. Intangible factors play an important role. Quality of life cannot only be measured in terms of wealth. The state of the environment, crime rate, freedom of expression, quality of education, etc. ... are criteria that influence the perceived prosperity of a society, although they are not included in the calculation of the gross national product. Even if in the last few years there has been a slow move towards a more holistic assessment and the integration of further criteria, there is still a tendency to limit oneself to monetary factors. If one assumes that states are artificial structures that were developed by people for people, national prosperity would have to be derived from the summation of individual opinions on actually perceived prosperity. This is a utilitarian position. Apart from the impossibility of this endeavor, people would incorporate a variety of criteria into such an assessment.

8.5. The prisoner's dilemma

The prisoner's dilemma is a major problem for capitalist theory. The classic doctrine says that the meeting of individual interests in the market leads to a result that corresponds to the overall interests of society. However, the oft-cited example of the prisoner's dilemma clearly shows that this is often not the case. Following the capitalist idea, people do not always tend to cooperate with others. Whether or not he only cooperates when he clearly recognizes his self-interest in the cooperation is secondary in this context. In some situations, cooperation between participants is clearly the most beneficial behavior for the general public. However, cooperation is not a one-off, short-term process; it requires a certain level of trust that is built up both culturally within society and between individual individuals.If capitalism only encourages opposing behavior, the opportunities for cooperation are permanently undermined. Thus, the market economy would in turn shape people in their behavior, something that is negated in capitalist theory. Capitalism with its constant pressure to maximize profit promotes short-term thinking and places less emphasis on trusting and long-term cooperation, since the results of the cooperation are often not recognizable in the long term and thus do not flow into economic calculations. The permanent pressure of the capital market and the current concentration the entrepreneur on shareholder value encourages positive results in the short term. There is again a focus on monetary results. A holistic entrepreneurial perspective, which ultimately brings the decision criterion down to a pure financial denominator by discounting future income, but still allows further qualitative and quantitative factors, has not come true.

8.6. Distributive justice

Unrestrained capitalism promotes the widening of the prosperity gap. The rich social classes increase their wealth disproportionately, whereas the less rich classes only become wealthier more slowly or even become poorer at times. A capitalist justification is that the poor are materially better off in the long term than before. Nevertheless, once the subsistence level has been exceeded, wealth and poverty are relative terms. Those who have enough to survive define their prosperity in comparison to the richer classes. Can these differences be justified? The contribution of the individual to the national product as a distribution criterion is an individualistic way of looking at things and is not sufficient. Need must also be taken into account, as the material starting position of people is not the same due to the institution of inheritance. Arthur Rich describes this problem as follows:

“A previous connection [...] already showed that in the case of the distribution problem, if it is to be approached in a humane manner, both the aspect of performance and needs justice must be taken into account. Disregard, even neglect of one of these points of view, inevitably leads to injustices. The market economy with its primacy of the individual performance principle corresponds at best to performance justice, but not to that of needs-based justice. "[16]

Anyone who takes the view that everyone is entitled to what they have achieved must admit that the inherited wealth and the social class born into them have nothing to do with their own achievements.

8.7. Product diversity and waste of resources

The right to exist for products is decided in a mechanistic way on the market. Only a fraction of all products and services developed prove to be marketable and go into production. The majority of products do not reach the final stage of the development cycle. Nevertheless, a large number of offers from various producers appear on the market, some of which hardly differ from one another. In order to be able to establish themselves on the market, these products and services must be marketed with advertising. It is estimated that around 30% of sales prices are currently consumed by marketing costs. Both the numerous, discontinued product developments and the subsequent marketing efforts for manufactured goods do not increase prosperity and can be viewed as a waste of resources, because they are based on the uncoordinated planning of individual companies. As stated earlier, waste is immoral because it has a negative impact on the lives of future generations.

9. Ethical justification of modern capitalism

Some possible criticisms of the capitalist system have been dealt with in the foregoing. It is possible to philosophically imagine an economic system that has fewer weaknesses, but practicability in the real world is essential, as this model can otherwise only serve as an example and role model. An economic model is developed by people for people, so realism remains important. Incidentally, an optimal system recognized by all people is also denied to philosophy, since some evaluation criteria are based on values. Values ​​are based on core beliefs and it is very difficult to convince other people at this level. Therefore, there will always be differences of opinion between people in this regard, even if large majorities can form for individual values. How can the market economy be ethically justified? By pointing out the supportive effect it has on people's understanding of the rule of law in modern democracy. It should not be overlooked that the countries that have continuously applied market economy principles in the private sector over the past two centuries have mostly seen positive developments in the area of ​​individual freedom in their societies in parallel. Humans have benefited from this with their basic right.

9.1. Subsystem of society

Capitalism is part of a holistic social system in which it covers the organization of economic aspects. It is for this reason that it must be remembered that the market economy is a subordinate system that must be in line with the superordinate model. It serves as a means to the higher end of supporting a social system that serves to preserve basic human freedoms. The Catholic Church shares this view in its recently reformulated Catechism: “The development of economic life and the increase in production must serve the needs of the people. Economic life is not only there to multiply the goods of production and to increase profit or power; it should primarily be in the service of the people. "[17] Capitalism cannot be value-free as it is supposed to support the positive values ​​of the system. It is not an end in itself, but a model that humanity uses to achieve higher goals. In this holistic social system as well as in its subsystems, commands and prohibitions for action are pronounced, depending on whether or not they serve to achieve the higher goal. These do's and don'ts are called laws. In accordance with the liberal idea of ​​this legal system, more prohibitions than requirements are pronounced. What is not forbidden is usually implicitly allowed. However, the laws cannot cover the full spectrum of human interactions. That would contradict the idea of ​​freedom, since too many laws restrict freedom in turn. That is why an accompanying ethical reflection and social morality are necessary, because society cannot function solely on the basis of the laws. The task of capitalism is to ensure the most efficient possible use of scarce natural resources within the social system. A task that he does well given the real conditions. If the argument is accepted that modern democracies are moral systems and that capitalism supports these systems, capitalism is inevitably moral.

9.2. Freedom system

Capitalism is an economic model based on the individual. It gives people the freedom to behave and realize their own ideas from an economic point of view. This freedom is granted to man as a basic right, a right that he neither has to earn nor work for, but has automatically. In this respect, all people are actually the same. By nature they have the same degree of freedom of action. From this perspective, the individualistic tendency of capitalism is particularly clear, since it leaves people to decide how they develop within their freedom. This freedom also gives them the opportunity to decide for themselves what is worthwhile self-realization for them. In capitalism there is no state authority that dictates to your citizens what kind of activity they should learn and exercise in the service of the general public. It is assumed that the market itself regulates the attractiveness and availability of jobs via the relative wage structure. This open, freedom-minded attitude towards people requires a social system as a basis, the implementation of which preserves and protects the freedoms of all people so that it can nourish and develop itself. In this context, however, it is important to note that the granting of basic economic rights must apply to all people of age living in society so that a correlation in the development of economic freedom and social freedom can be derived. Because discrimination against certain groups of people (gender discrimination, racial discrimination) also make capitalist systems conceivable in unfree societies. This common principle of natural freedoms in a market economy and in democracy makes both moral systems.

9.3. Ethics in Capitalism

The argument that ethics are superfluous for economic decisions in capitalism because moral behavior increases costs and is fraud against the owner (shareholder) is understandable. However, moral behavior is necessary in all situations in which the interests of fellow creatures are affected. According to Koslowski, business ethics that influence common morals are indispensable in capitalism: "Business ethics are necessary in a market economy because a market-based system leaves a lot of room for freedom of decision and thus ethical responsibility."[18] Incidentally, the intention to behave morally in the economy is an extra-economic decision, since the overriding social system makes this decision necessary. The argument also applies to the problem of re-distribution of the generated national product. This decision must also be considered non-economic, since the distribution must be compatible with the basic values ​​of society. The interfaces of the line of argument are as follows: The starting point of the considerations is the axiom of the inviolable individual freedom of man. On this basis, a holistic social system is developed that includes the maintenance of these individual freedoms as a central maxim. In this system, certain actions are required and forbidden (by law), depending on whether they serve to achieve the overall goal. Since this standardization cannot cover all possible human actions and because a large number of actions can only be assessed as moral or immoral from the context, ethical reflection and a moral social awareness are indispensable.[19] The overall system is made up of various sub-systems, each of which covers a specific area of ​​society: the economy includes business, science, research and teaching, etc. ... All sub-systems must be in harmony with the overall system. Modern capitalism in its many different forms fulfills this claim. He supports modern democracy and the underlying understanding of freedom.

9.4. The influence of the state

An economy on its own is not going in any clear direction, it is developing in an irrational way before it. Again and again it bends to the spontaneous wishes and needs of society or individual influential citizens; a long-term perspective is not possible. There is no connection to the higher goals of the overall system, as this is not explicitly promoted. A conscious control of the economic process is necessary, and capitalism as an economic model is optimal within such an organization, since it leaves a lot of freedom and needs relatively little regulation for its functioning. Little regulation means a lot of room for maneuver and more freedom. Under the same conditions, between two subsystems that achieve a comparable result, the one that requires fewer regulations is preferable, since it is more in keeping with the human idea of ​​freedom. If one agrees with this assessment, capitalism can be described as good for people because it enables them to really be human and to act at their own discretion within the scope of their capabilities. Since there has so far not been any implementation of economic models in reality that are fairer to human characteristics and leave so much freedom to the individual, capitalism must be viewed as the most morally practiced system up to now.

9.5. Capitalism and morality

How do people deal with their moral freedom? Capitalism gives it a great deal of leeway and thus many opportunities to act morally. Moral action presupposes voluntary action. However, reality shows that humans make little use of their moral freedom. On the contrary, one can even see that the increasing release of social and religious constraints, which are also noticeable in economic activity, reduce people's willingness to voluntarily restrict their freedom on behalf of their fellow creatures. It would be problematic to recognize that although capitalism grants the citizen greater moral freedom to make decisions, it shapes them in such a way that they are increasingly less willing to do so. There are signs of such a development. One possible explanation is that the market economy encourages behavior that views fellow human beings as a means to achieve one's own goals instead of always seeing them as end ends in the Kantian sense. Adam Smith saw this as a rational behavior, the following quote makes this clear: “On the other hand, man is almost always dependent on help, although he can hardly expect that he will receive it solely through the benevolence of his fellow human beings. He will probably achieve his goal much sooner if he knows how to use their self-love in his favor by showing them that it is in their own interest to do for him what he wants them to do. "[20]. Such behavior contradicts Kant's moral understanding: “Now I say: man and every reasonable being in general exists as an end in himself, not just as a means to any use for this or that will, but must in all his own itself as well as actions directed towards other rational beings can be regarded as an end at all times. "[21]. Michael Prowse sees here a contradiction inherent in capitalism: “Capitalism gives us the means to treat others well [...] But market interactions are not like this. In the market we are given incentives to maximize our personal utility or well-being. And this leads us to treat others as objects to be manipulated to further our ends. "[22] This realization is a problem that is difficult to solve, because on the one hand there is a claim to leave human beings their inviolable natural freedoms, on the other hand they must also perceive and cultivate these freedoms in a moral way, because otherwise the foundation is removed from the system and collapses . However, this is not a purely economic question, it goes on. It affects the entire social system. Capitalism is only a subsystem of the whole social system and corresponds in its features to democracy. Man has to find his way around this free social structure. A free thinking system that has opposite effects poses a problem. Obviously, in the twentieth century, once significant social ties have weakened as people have become more hedonistic and self-centered. It is very certain that these effects are at least partly due to the market economy. There seems to be a mutual interaction between the human being and the system. Initially one starts from certain human characteristics which the capitalist system accommodates. At the same time, this system promotes the presupposed properties and confirms itself. Thus, a way out of this circle is hardly possible, unless one allows interventions on the part of the higher social system. Under the premise of feasibility, it is difficult to imagine an economic concept that does human justice as much as capitalism does. However, the limits of an economic system must be recognized. This has often been overlooked in the past. Especially since the rivalry between capitalism and socialism there has been a tendency to ideologize and to expand economic thinking to all areas of life. An economic system should primarily guarantee an efficient use of resources. The connection to the superordinate social system appears in the redistribution of wealth. A normative regulation is then simply necessary. The classic, capitalist idea that the market regulates this itself is not realistic. The transfer of natural laws to human systems is not tenable.Since man acts consciously and the actions of a large number of people influence one another, a minimum of coordination is necessary. The classic doctrine of capitalism bypasses the question by treating problems like public goods, externalities, etc ... as exceptions. The reality shows that active interference by the state authorities is necessary. Nevertheless, there is a permanent danger that the coordination and control functions will be taken over by people who put personal values ​​and goals in the foreground.

10. Conclusion