Moral Capitalism.
Moral Capitalism is not about Greed nor
it is about hunger for power and money that help the rich and hurt the poor.
In Free Market is not only economically superior but also morally superior in organizing economy behavior. Why? Voluntary action between individual and no coercion.
Moral Capitalism establish Free market where
The ambition and Voluntary Effort of its citizens, not the government drive the economy.
The book exposes several core fallacies holding up modern financial free-market orthodoxy and which contributed to the recurrent failures of banking and finance to sustain healthy economic growth for all. The book argues that: 1) It is wrong to oppose public, goods to private goods, with public goods consigned to governments for distribution and private goods left to allegedly only self-serving free markets. Some notional public goods – education, social services, transportation, etc. – can be effectively sourced and delivered by markets. And, to the contrary, some private goods affect the public interest and so draw upon themselves aspects of public goods. There is a continuum of goods and services ranging from pure public goods to pure private goods, with intermediate goods of a mixed character. Quasi-public goods and quasi-private goods can be provided by private enterprise through open market transactions. These are shared value goods and services. Financial intermediation is such a mixed public and private good. 2) Corporate social responsibility performs a mediation function between private goods and services provided by the firm and public goods demanded by society. 3) A limited theory of valuation – which ignores intangible assets and liabilities – caused the asset bubble and resulting collapse of leverage in the fall of 2008. A better theory of valuation is proposed to add public good dimensions to the calculation of private asset values. 4) The existence of an agency problem in finance and corporate governance is challenged. Current agency theory presumes that markets are incapable of providing public goods. The assumed agency problem supports companies ignoring stakeholders, externalities and fiduciary duties of responsibility. 5) Anxiety and money exacerbate the selfishness which brings the agency problem to the fore, but they can be offset by enhancing the strength of the moral sense, which is part of each person’s social-psychology. The severity of the agency problem is rejected by value-based cultures – Catholic social teachings, Buddhism, Chinese ethics, Taoism, Aristotle and Qur’an. In addition, I/Thou relationships and friendships sustain values to overcome the agency problem. 6) Financial institutions need to be incentivized to provide public goods in addition to private goods. 7) “Wall Street” may be more about rent-extraction than investing in real growth. In much of finance, contract rights – shares, bonds, loan participations, derivatives, etc. – are only “rented” for a short time in order to flip them for a higher price. Why, then, should traders be given all the respect due to owners who invest for the long-term? 8) The US Dodd-Frank reforms did not challenge the inherent dysfunction in financial trading, but only sought to distance public coffers from responsibility for making good on private losses. 9) It is self-restraint – the moral sense as provided to each of us by Natural Law – which can align private goods with public good and so lead us to a moral capitalism.
The world is drifting without a clear plan for its economic development. Communism is dead, but in the wake of Enron and similar scandals, many see capitalism as amoral and too easily abused. A blueprint for progress is needed and Moral Capitalism provides one.
Moral Capitalism is based on principles developed by the Caux Round Table, an extraordinary international network of top business executives who believe that business can--and must--weigh both profit and principle. Caux Round Table's global chair, Stephen Young, argues that the ethical standards inherent in capitalism have been compromised by cultural values inimical to capitalism's essentially egalitarian, rational spirit, and distorted by the short-sighted dog-eat-dog doctrines of social Darwinism into what he calls brute capitalism. He demonstrates how the Caux Round Table's Seven General Principles for Business can serve as a blueprint for a new moral capitalism, and explores in detail how, if guided by these principles, capitalism is really the only system with the potential to reduce global poverty and tyranny and address the needs and aspirations of individuals, societies, and nations.
Shibusawa Eiichi (1840–1931) was a Japanese banker and industrialist who spearheaded the modernization of Japanese industry and finance during the Meji Restoration. He founded the first modern bank in Japan and his reforms introduced double entry accounting and joint-stock corporations to the Japanese economy. Today, he is known as the “father of Japanese capitalism.”
Ethical Capitalism is a volume of essays that tackles the thought, work, and legacy of Shibusawa Eiichi and offers international comparisons with the Japanese experience. Eiichi advocated for gapponshugi, a principle that emphasized developing the right business, with the right people, in service to the public good. The contributors build a historical perspective on morality and ethics in the business world that, unlike corporate social responsibility, concentrates on the morality inside firms, industries, and private-public partnerships. Ethical Capitalism is not only a timely work; it is a necessary work, in a rapidly globalizing world where deregulation and lack of oversight risk repeating the financial, environmental, and social catastrophes of the past.
As Southeast Asia experiences unprecedented economic modernization, religious and moral practices are being challenged as never before. From Thai casinos to Singaporean megachurches, from the practitioners of Islamic Finance in Jakarta to Pentecostal Christians in rural Cambodia, this volume discusses the moral complexities that arise when religious and economic developments converge. In the past few decades, Southeast Asia has seen growing religious pluralism and antagonisms as well as the penetration of a market economy and economic liberalism. Providing a multidisciplinary, cross-regional snapshot of a region in the midst of profound change, this text is a key read for scholars of religion, economists, non-governmental organization workers, and think-tankers across the region.
