In medieval times it seems capitalism flourished on the principle of fair dealing, hard bargaining and allowing the "market" to determine the value of any goods or services. Naked greed was not something the merchant classes encouraged or accepted. Medieval traders built trading empires, extended credit and charged interest on it, but frowned on blatantly selfish economic behaviour. Anyone who was blatantly greedy and deliberately drove prices up to increase profits soon found himself shunned and despised by his fellow businessmen.
The interesting thing is that these men were also intensely conscious of community needs, and there are many examples of foundations they established for the benefit of the communities they lived and worked amongst. The City of London still funds most of its activities from money invested in Foundations and Trusts established for the benefit of the populace by men like Sir Richard Whittington (yes, Dick Whittington was a real person). Put simply, blatant greed was simply unacceptable among the Mercant classes of this period, so why has it changed?
It does seem to have crept in with the Reformation. Over the last 500 years there has been a gradual drift toward amassing and holding as much wealth as possible. Gradually the ethos of 'taking care of the poor of the parish' has been pushed away from the individual and onto 'the parish' at first and now 'the state.' That sense of being part of the community and sharing one's good fortune with a community, has apparently gone. Now the faceless 'state' must provide, the merchant's only concern is how to make sure he contributes as little as possible toward it.
Adam Smith certainly did not advocate unbridled greed. His treatise on wealth and wealth creation highlights the fact that wealth and prosperity need to be shared fairly, not simply accumulated for the benefit of a few. A fair price should be coupled with a fair wage for a fair days work. That last bit does, of course, impose the need for the 'worker' to deliver what they have contracted to do - a fair days work. And they do have a right to expect a fair wage for it, but you soon realise that a worker who failed to deliver in medieval times soon found himself out of work, house and community. Just as greed was frowned on, so to was idleness and shoddy work.
The Medieval Guilds acted to regulate many of these matters, and, according to one blog I read regularly on medieval matters, sometimes even condoned the murder of excessively greedy individuals whose actions threatened the welfare of the wider community. The full article I read on this can be found at Medievalists.net under the title Greed wasn't good in the Middle Ages.
Perhaps a return to some of the ethics they practiced would do much to cure some of the ills that beset our economics today. However, I suspect that we workers need to get our focus adjusted as well. It is our demands for a greater share of the "merchant's rewards" that propels prices ever upward.
The medievals see to have things right.
ReplyDeleteI wonder if one of the reasons we see less help from the well heeled for the community today is because with federal government taking more taxes away and spending them on not entirely effective but overbureaucratized attempts at the same thing, people have begun to believe, "it's the government's job".
"The words you should fear most are 'I'm from the government, and I'm here to help'."
-- Ronald Reagan
I know that many employers have actually been "run out" of the United States, outsourcing the manufacturing of goods and many services because the unions have all but made themselves partners in these firms by constantly demanding more and more in terms of wages, allocation of on-the-job responsibilities for their members and of course their many benefits, yet at the same time they protect the lazy and the incompetent, preventing them from being dismissed and maintaining the same wages for them that are paid to the best and the brightest.
Just live in New York and observe the day to day activities of infrastructural union workers, the ones who service public rest rooms (loos), are charged with keeping escalators working and so forth.
It's a never ending quagmire...
All the criticism of 'Capitalists,' while to some extent justified, masks the other end of the coin - the Unions that have driven many companies to the wall with their demands. I confess I'm ambivalent about the activities of Unions. They do some good work, but they encourage an attitude of 'entitlement' and drive unrealistic demands to the point where - as you say - jobs end up being moved out of communities and countries. One example has to be the Fire Brigades Union in the UK which demanded (and then got everyone out on strike for) a starting wage level increase equivalent to a 30% payrise. What was never considered or at least never admitted, was that raising the basic pay of a firefighter to £30k pa would push every Grade up by a like percentage. No employer could fund or justify a rise like that - least of all one funded by the taxpayer!
DeleteThe result of the strike was cuts in staffing, changes to recruiting and the legislation and the service lost out - primarily it lost the respect of the populace. I think Unions have a place, but I am seriously uneasy at Union Leaders earning as much or more than senior managers in International companies. Some earn as much as some of the "bankers" they fulminate against.
I think Ronald Reagan was a very astute man!