The connection between traditional values and economics

Morality doesn’t only inform legislation; legislation informs morality. Political scientist Will Morrisey notes that men write constitutions and make laws that in turn help shape “citizens’ opinions and patterns of behavior.” Morrisey wrote the introduction to the The Moral Foundations of the American Republic,” a book that contains several essays and arguments about what that foundation looks like.

In the book, Martin Diamond has an essay titled, “Ethics and Politics: The American Way.” He writes that the American Founders seemed to have “taken for granted” that the higher human virtues would flourish. While they presumed man’s nature was weak, it nonetheless would have a “natural inclination to certain virtues.”

They didn’t rely upon those natural inclinations, however, but built into the governmental system checks and balances and a division of power. Even so, we quoted George Washington and John Adams who said that a moral people would still be required to keep the process working.

Diamond writes that the founders’ assumption was that sufficient virtues “would continue to develop from religion, education, family upbringing, and simply out of the natural yearnings of human nature.” They presupposed “certain enduring qualities” in “the American character.” They then set up a system designed so order could arise despite “human interests and passions.”

They laid a foundation which could withstand imperfect people – but not too imperfect. There still was the need for the nurturing of character. The preservation of the foundation – as well as “the nurturing of the appropriate ethical excellences” – are, in the words of Diamond, the “compound political task of enlightened American statesmen and citizens.”

For the founding fathers, our governmental structure and the good character of the people go hand in hand. Similarly, there is a connection between the social and economic issues.

Those who wish the Republican Party would stick to economics miss many obvious things – including what should be obvious: the laws of economics are based upon human nature. While there is disagreement about the degree to which human nature is fixed or malleable, no one to my knowledge presumes there is some separate economic dynamic apart from whatever human nature is. You can’t count on bad people to do the right thing.

When fraud, greed, bad judgment, and corruption dominate in the economic arena, the fault lies with humans, not with some esoteric notion out of an economics textbook. A lot of people today need to learn what our founding fathers knew a couple of centuries ago: what informs and guides human behavior is crucial if you want to enjoy the best economic system human possible.

In yesterday’s Wall Street Journal, Harvey Golub, a former chairman and CEO of American Express, writing about the current financial mess noted that consumers and governments must stop incurring so much debt and other obligations. Governments, in particular, he said, have many “obligations that cannot be met under any set of reasonable circumstances,” because –

– “we continue to incur debt for politically palatable ideas, like rebate checks, which have very little stimulative power but increase the depth of the hole we’re in.

To solve this problem for ourselves and future generations, we must get back to our historic reliance on personal responsibility and market forces, and get government out of economic management. It doesn’t do a good job, as the current economic mess amply proves.”

I don’t know about you, but to me that sure looks like the practical application of morality.

Columnist Dennis Byrne recently wrote this:

“In just eight months, we have made a fundamental change in our financial system and our form of government, without much debate or with, I dare say, no foresight. I’m glad I don’t have to make these kinds of decisions, but I can’t help think that we have lost something in our national character…”

He’s right to make the connection. Behavior determines not just whether a civilization is civil and just, but also whether it is prosperous.