October 18 in the frame of the Day of Spiritual Accord, at 14:00 (GMT + 6), Nur-Sultan (Kazakhstan) will host an International conference themed: "Strengthening interfaith and interethnic harmony as an answer to modern world challenges ".
Ernst Klatte, Germany PtC-Germany: head of Dept. Economy and ETHICS Economy – Power and Ethics, Humanism and Conscience (nationalization of financing and banking system) The Power of Economics and Ethics How can regulative ethical codes be used as an economic moral compass? 1. How economics came to dominate our culture The reign of economic thinking over the cultures of the World has, today, become a tyranny; and the greedy king at its head has been welcomed all over the planet regardless of natural and cultural frontiers. Yet the culture of the “financial industry” he propagates is no longer of service to society, but only to a small number of ruthlessly selfish investors who privatise profits whilst leaving society to pick up the losses. This means that it is high time to ask questions about the border between corporate responsibility and the role of the state under the conditions of rapid globalisation. All over the world, solidarity is in danger of breaking down: solidarity between generations, between classes, between genders and between citizens and immigrants.
Our societal systems encourage selfishness, double standards, false moral and opportunism; politicians spend their time looking for the right words to disguise the wrong decisions.
Not a day goes by without discussions of white-collar crime, corruption and corporate governance, but weeks and months and years drift away without concrete action. Despite the pace of change in society speeding up, despite the diversification of social situations and despite the impression an increasing number of citizens have of their societies as dangerous places, the State is, across the World, withdrawing from its responsibilities.
Neither do citizens expect much from science nowadays: rather than progress and humanisation, they see research into genetic modification and reproductive medicine as new dangers for human life itself, as well as the threat of a new strain of coldness and callous economic reasoning that ignores the human factor. Rather than seeing globalisation as a gain, most citizens see it as a danger that is creeping into every part of their existence. These ways of thinking are changing people and their environments in equal measure; and this change must be turned back from a negative into a positive one. For this to happen, we will need to grow beyond doing things merely because they are feasible - and start doing things because we should do them; scientific and economic progress need not be stopped, but it needs to be re-orientated along ethical lines. Ethics must become the new centre of our world and of our collective consciousness; only then will people act ethically without being forced to do so.
If we look back over the millennia past, there is plenty of evidence of economic systems and cultural environments that were focused on the people involved, which served them and society as a whole. For this reason, it is legitimate to expect a globalized economy to serve the world. The core of the problem is that political and religious leaders in the past saw themselves as responsible to the cosmos or to a higher authority and acted accordingly, aiming to apply the cosmic order as they understood it to the highest possible good of the subjects entrusted to them. Today, however, the highest instance is no longer the cosmos, but the financial system.
Today’s pseudo-cultural patterns of behaviour are such: taking the earth to its limits in terms of its ability to provide our sustenance and process our waste, destroying the physical and material basis on which societies are built. Furthermore, these patterns are clearly destroying the biological foundations of humanity, since peoples who adopt them sooner or later begin to shrink in terms of population numbers. In this cultural climate of extreme individualism, there can be no basis for society, only a rapid descent, away from solidarity and empathy into a vortex that sucks in and destroys all positive energy. One consequence of the decline in solidarity is mistrust and alienation, because when societies are confronted with long-term imbalances within the various fields of culture (which is defined as the sum of everything produced and influenced by humans), they reach a crisis and try desperately to define themselves by drawing borders. This leads to certain areas of human culture – in this case economics and the international finance industry – prevailing and determining all other forms of culture. This must be stopped; a fundamental discussion of its contents and of the intellectual and cultural limits of what we want (or need!) to understand by the very word culture is required.
2. Economics, ecology, culture and politics – complexity of contexts and conclusions
Further to this pressing issue, we are at the breaking point of a fundamental change to where the global economy works. Technology nowadays is faster than man, and this can lead to political, social and perhaps even psychological disturbances.
The French philosopher Paul Virilio sees this apocalyptic scenario as a “global accident”. By this, he is referring to the danger of a virtual catastrophe that could lead to a kind of worldwide short-circuiting of knowledge and conscience. This is an age in which whole continents can be wiped off the map at the touch of a button and computer viruses can cross the globe in a matter of hours; the rapid spread of the financial crisis and the economic consequences are an example of interwoven nature of our societies.
In biology and in natural sciences, we know that complex systems are characterised by a highly intensive network of co-dependencies between the various parts of the whole, meaning that no system can be understood by just examining one single component. Organic systems are not deterministic, cannot be pre-programmed, and causality is only applicable in a small measure. This means that there is no way of predicting the behaviour of complex systems over a long period of time and they can only be influenced by external laws to a limited extent. When we consider that human society is without doubt one of the most complex systems in existence, this makes this aspect of biological methodology eminently applicable to humanity as a whole. This means that we urgently need a complexity theory for human society, especially when we consider that it is the complex dynamic of actions and developments in modern society that is making classical concepts of political, technical and moral control redundant.
Society today is, more than ever, characterised by a high level of complexity in terms of how people interact; this is in the main a result of specialisation in the labour force. The web of interdependence, made up of countless threads from individual to individual, has lead to personal relationships being increasingly replaced with anonymous contact. Humans are now at the mercy of a functional context that can no longer be viewed as a whole by any single person. The autonomy of various areas of knowledge and their de-coupling from a holistic order (i.e. an system of ethics) may have enabled huge strides in technological and material terms, but has removed the dynamic balance of human society. The clearest example of this is human-induced climate change.
3. The necessity of laws backed up by punitive measures as an ethical system
In view of the complexity of today’s interactional structures, the traditional pre-eminence of moral and ethical paradigms as an overriding element of societal decision-making systems no longer exercises a sufficient effect. Furthermore, within the limited area of its effectuality, a “good” intention can no longer come anywhere near guaranteeing a “good” outcome. This means that an understanding of ethics solely as a system of virtues has been discredited: ethics must now be seen partly as a system of rules which takes account of complex structures and therefore of the need for the individual to act ethically. Traditional, informal methods of enforcing ethical rules require face-to-face contact, and this form of extrinsic motivation is now redundant; ethical actions in today’s climate require intrinsic motivation on the part of the individual – i.e. self-interest must lead to the application of ethical principles. This is a radical change.
We can now see the importance of a legal framework with the power to punish as a way of extrinsically enforcing ethics as a prerequisite for reaching goals that are of importance to society as a whole: and although this is to be seen as a counterpart to non-legally adjustable intrinsic motivation, it is nevertheless a bitter pill to swallow, inasmuch as new laws and regulations are fundamentally equal to a last desperate attempt to correct the behaviour of individuals, and the systems that favour their unethical actions; for legislation may attempt to create an atmosphere of trust, but it is clear that it can be no genuine replacement for personal relationships. Despite this, laws are intended to support and reinforce ethical decisions, and this is why Peter Ulrich speaks of “institutional corsets”; after all, without this aim, it would be impossible to justify new legislation. Furthermore, what laws can do is to make clear moral targets, to be held high as blueprints for an ethical society, whether this is realistic or not. An example of this is the crime of breach of trust, intended as a way of punishing greed; there is a reason that this is one of the most common incidences of white collar crime – i.e. it needs to be legislated against.
4. Economic ethics must work as applied ethics – changing of thought and behaviour
Economic and commercial ethics begin with the refusal to exploit every single opportunity to increase income and profits without due consideration to consequences for the environment and humanity. This in turn requires a valorisation of ethical behaviour as such, regardless of the legal framework and what it may or may not allow, since this external system does not and can never replace the inner voice of conscience and responsibility. This is not a question of power and advantages, but rather of legitimacy and responsibility in the context of individual action; in this respect, it is a question of putting ethical considerations before strategies for success.
One aspect of this is the way in which we consider economic processes and patterns of thought. The role of ethics in economy and in the world of finance when there is a direct conflict between self-interest (i.e. profits) and the legitimate interests of others (ethics, morals) is as controversial now as ever: the way in which society views such moral dilemmas is as “trade-offs” between profits and ethics; and yet precisely this controversy shows how our ways of thinking are limited. For in thinking exclusively about conflicting interests, we are making conflict inevitable. What is really required is a completely new way of thinking, a change towards a consensual pattern, away from trade-offs with winners and losers - towards a win-win system of positive mutual compromise.
Economic ethics is by no means an individual system; it is an institutionalised one with the aim of forcing the system of economic interaction into a system of ethics. Due to the fact, however, that there are different concepts of reason, there are, consequently different concepts of economic ethics. The current debate about economic ethics, for example, is characterised by a tension between three fundamental positions which, despite general agreement about the cause of the economic crisis, use different reasoning to attempt to solve it: there is the dogmatic-modern system, the reflective-modern system and the reflective-modern system.
The dogmatic-modern system takes economic ethics as king and widens its rule of cost-benefit analysis to all realms of societal and moral action: it represents a full convergence between market rationality and ethical-moral considerations. The aim is to develop pure “economic rationality” as a universal remedy. The idea is that far-seeing economic intelligence will, due to its innate superiority in terms of logic and calculation, eventually function as a motivational basis for moral principles inasmuch as acting in accordance with moral principles will be seen to be economically beneficial to all parties involved.
This concept of ethics and economics has, of course, the truly alarming consequence that our traditional vocabulary of morality – including terms such as responsibility and obligation – disappear to make way for a language of rationally-considered benefits; this system subjugates true moral motivation for the dictates of economic rationality and this would, as far as I can see, mean renouncing the cherished ethical and cultural convictions on which society has been built to date.
The other two systems of economic ethics are different in as much as they aim to bring “economics to reason”, rather than transform reason through economics. In this respect, both systems aim to contextualise markets in an ethical environment and to subjugate economic concerns to another system of rationality. There is, for example, the ethics of cultural modernisation, placing its trust in the power of the open society and its discourse; or there is another approach aiming to embed economics into a holistic system of spiritual and cosmic considerations and thus return the markets to their human roots.
I personally am more open to this latter way of thinking because the underlying idea of a systematic, philosophical economic ethical system is to move economics into an environment defined by morals, human rights and a network of institutions founded on the ideals of the constitutional welfare state. After all, we are talking about homogenising our cultural and intellectual ethics on the basis of a single unified understanding of the world and a vision for the direction in which we wish to take it. Unfortunately, however, society today is not a society whose unity is based on common goals and values; there is no longer an overriding good, a Platonic or Aristotelian concept of ethics that could draw all people / individuals and functions of society together into a comprehensive unit. A German professor of Philosophy and Ethics, says: “There is no way of defining societal aims, no teleological way of giving the economy, politics and society as a whole a meaning common to all.” This has to be changed in the future, though! The entire world must work together on this subject to bring a change about! Also this Forum will serve this target. The work we have to do, however, to bring about change, starts in our families, in our local communities, in schools – and it ends in universities and in our professional lives.
At the present time, our children are being taught in school to “function” in society, to follow the goal of “rationality” in a world influenced by technological and scientific concerns – i.e. geared towards the labour market. This leads inevitably to egocentric patterns of behaviour, and for this to change, curricula must be re-written to encompass social and intellectual contents and to cater to the intrinsic human desire to strive for enlightenment without a particular system nor specific goals (entelechy). At universities, we will have to set up a chair for management which is interdisciplinary and, at the same time able to bring different disciplines together. The aim of these professorial positions would be to educate managers over and beyond pure economic logic, and this in turn requires managers to be active examples in roles, to embody and live a new culture of ethical leadership and respect for non-profit considerations. Courses should offer subjects such as philosophy, ethics, culture, languages, international law and social sciences. Furthermore, a neutral form of economics should be taught, one that goes beyond the stock market and the flow of capital.
Even after these steps have been taken, however, ethical behaviour will not take place in the economy without the strong hand of the law as an “institutional corset”. Ideally, this would involve developing national legislation to be ratified by international participation. In addition to this, contracts should be prepared by international institutions and breaches of them made punishable.
Moreover, an “ethical, intercultural humanism” must be put in place as primacy of a consensual system of corporate governance and compliance based on global ethics; this system would have the power to solve global problems by enabling decisions which can be implemented and guaranteed. In terms of civil society and from an educational point of view this intercultural philosophy will foster the development of a global consciousness unfolding the force to urge politics and businesses to work towards a solution for the benefit of the world’s problems.