CHAPTER VIII

 

IS AN ETHICS OF

ECONOMIC ACTIVITY POSSIBLE?

 

ZHANG RULUN

 

 

Is an ethics for economic activity possible? To answer this question we must first ask: What does "an ethics for economic activity" mean? In general, the term "ethics" is used in three different but related ways, signifying: (1) a general pattern or "way of life", (2) a set of rules of conduct or "moral code", and (3) inquiry about ways of life and rules of conduct. In the first sense we speak of Confucian or Christian ethics; in the second sense, we speak of professional ethics and of ethical behavior. In the third sense, ethics is a branch of philosophy that is frequently given the special name of metaethics. Obviously, the present discussion primarily has something to do with ethics in the second sense, that is, an ethics that is a set of rules and criteria by which a certain group or community regulates its conduct and determines what is legitimate and what is not for realizing its ends. Business is such an ethics, for business is certainly a kind of economic activity. For this reason, our question "Is an ethics for economic activity possible?" might be superfluous.

However, if we inquire further into the essence of ethics and of economic activity we may come to another conclusion. We assume that ethics consists of a set of rules of conduct or a "moral code". Moral rules are precepts that ought to be followed, whether or not this actually is done. Moral rules, in this sense, are very different from rules which define customs and practices: one can find empirically what rules people advocate or observe, but, as Hume and G.E. Moore insisted, one cannot determine by such empirical study whether these rules really ought to be followed -- that is, whether they are moral rules. Moral rules differ also from rules constitutive of either formal systems or institutions in dealing typically with what must or cannot be done rather than specifying what may be done. The Ten Commandments, for instance, include only prohibitions and obligations, not permissions; so does Kant’s categorical imperative. For philosophers like Kant who stress deontology in ethical theory, moral rules must be obeyed without considerations based on concern for one’s own well-being or that of others.

From the point of view of utilitarianism, however, it seems important to distinguish further between "summary rules", which provide a simple rule of thumb for maximizing utility in most cases, and "practice rules", which are rules one must (logically) follow in order to participate in some ethically valuable practice. If, for example, the precept not to tell lies is a summary rule, a utili-tarian may justifiably decide to lie in a given case after considering the effects of a lie in that one case alone; but if the precept is a prac-tice rule, it may be claimed that a utilitarian must also take into account the beneficial consequences of any practice which depends on and is partly constituted by the rule. Designed to meet traditional criticisms of utilitarianism by severely restricting direct utilitarian consideration of the individual case, rule-utilitarianism considers that many moral rules are practice rules. But since modern times it appears that the connection between abiding by the moral rules and achieving goals is a merely contingent one.1 It is true that in some cases it is not most beneficial to obey the rule; if we are concerned only with beneficence, in these cases we ought not obey the rule. But the rule should be obeyed, otherwise it would not be a rule. The act utilitarian knows that he would go mad if he deliberated on every trivial issue, and that if he did not go mad he would at least slow up his responses so much that he would miss many opportunities for probably doing good.

Furthermore, any ethics would involve such questions: What do we or should we mean by "good" and "bad"? What are the right standards for judging things to be good or bad? How do judgments of good and bad (value judgments) differ from and depend upon judgements of value-neutral facts? An ethics for economic activity, if it is possible, cannot avoid these questions. Of course, we may divide our subject matter into the search for the meaning and standards of good in general, and of well-being, right conduct, moral character, and justice in economic activity in particular. But these are not watertight compartments. Finally, they are subject to reunification in accord with a given ethos and based on our moral beliefs and ultimate moral principles. Here, it is practical ra-tionality that guides and determines our choice and actions. In this sense, in the last analysis, ethics is a matter of practical rationality.

On the contrary, the principles of economic activity are of technical means-ends or instrumental rationality: economic acti-vity is purposive rational action. Max Weber characterizes the history of the modern West as "rationalization". By "rationalization" he understands progress in putting into force a means-ends rationality in all sectors of the socio-cultural system, especially in the sphere of economics and bureaucratic administration, under the constant influence of progress in science and technology. At the same time, parallel with rationalization, there is a process of dis-illusionment or, as Max Weber likes to say, "disenchantment" (Entzauberung). By this Weber understands, among other things, the dissolution of a commonly accepted religious or philosophical value. According to Weber, technical means-ends rationality is value-free. For this rationality, what counts is success or, more exactly, achieving goals. What is of concern is only to find appropriate means and strategies to attain one’s object. To this end it can take anything, including ethics, as means. For example, in China, inspired by Weber’s Protestant Sects and Spirit of Capi-talism, many scholars are attempting to find the use of Con-fucianism for modernization and some are trying to establish an ethics for market economics. In antiquity, ethics had guided people’s action, whereas now ethics only justifies action. Ethics also becomes an instrument to help us attain our ends or deal with our predicaments. As a result, on the one hand we have more and more instrumental ethics; on the other hand we land more and more deeply in a crisis of morality. "The desire for an ethics presses ever more ardently for fulfillment as the obvious no less than the hidden perplexity of man soars to immeasurable heights. The greatest care must be fostered upon the ethical bond at a time when technological man, delivered over to mass society, can be kept reliably on call only by means correspond technology."2 If technical or instru-mental rationality replaces or assimilates practical rationality, can we have any ethics in its original sense?

 

ARISTOTLE

 

To answer this question, let us return to Aristotle, whose concern is precisely what role reason plays in all ethical behavior. Aristotle divides human activities into three types: theoria, praxis and poiesis. Only praxis and poiesis and their difference are re-levant to our present discussion. According to Aristotle, there is an interesting and significant kinship between praxis and life; as he says in the Politics, "Life is praxis, not poiesis."3 If we assume that life may be described as some kind of activity, it clearly is not an activity which reaches its completion by stopping and leaving behind something different from itself: to live is like playing a flute, not like building a house. Praxis is an action which, instead of having an end, is an end, and which, in this sense, is not a means to the end.

Praxis, Aristotle says, is activity which includes the end. Because of this inclusion of the end within action, praxis is a process which has no defined limit by which it ceases at some time, and by which an opposition occurs between a past and present. Seeing, for example, is properly a praxis and likewise thinking. At each period we always think and have thought. In contradistinction to this, learning, for example, is not properly a praxis, but an activity which is a means to an end outside it: we cannot at the same time, for example, learn and have learned, whereas now we both are living and have lived, our life is a past and present praxis.4

Insofar as praxis as such is the end chosen rationally by people, praxis refers to rational and purposeful human conduct. Of course, "making" as well as mere thinking is rational and pur-poseful human conduct as well. In fact, Aristotle sometimes seems to use praxis in so wide a sense that one gets the impression that it is supposed to cover "making " as well. Still, in its most technical sense the expression praxis covers only those human actions and activities which Aristotle discusses in his ethical and political writings: moral action and political activity. We may simply say that praxis is Aristotle’s term for man’s free activity in the realm of ethical and political life.

Aristotle opposes praxis and poiesis several times.5 He himself illustrates the difference between these two kinds of acti-vity by saying that while poiesis aims at an end different from the very act itself, the end of praxis is nothing else but the act of praxis itself performed well. We may add that while poiesis itself seems to be a value-free activity, praxis is, in fact, an activity of our moral and political life. According to this distinction, economic activity belongs certainly to poiesis.

Corresponding to the distinction between praxis and poiesis, there are two modes of intelligence: phronesis and techne. The former is the ethical know-how, and the latter is the technical one. Gadamer summarizes their significant differences in Aristotle’s ethics:

 

(1) A technique is learned and can be forgotten; we can "lose" a skill. But ethical "reason" can neither be learned nor forgotten. Nor is it like the professional knowledge that one can choose; one cannot put it down, like a profession, in order to take up another one. By contrast, the subject of ethical reason or phronesis always finds himself in an "acting situation" and is always obliged to use ethical knowledge and apply it according to the exigence of his concrete situation. For this very reason, it is problematic to speak of "application", since we can only apply what we already possess. Ethical knowledge is not our property in the same way that we have something at our disposal and choose to utilize it or not.

(2) There is a different conceptual relation between the end and the means in ethical knowledge, on the one hand, and in tech-nical knowledge, on the other hand. The end of ethical knowledge is not a "particular thing", rather it determines the complete ethical rectitude of a lifetime. Moreover, and more importantly, technical activity does not demand that the means which allow it to arrive at an end be weighed anew on each occasion and personally by the subject who is their practitioner: "He is already an expert; he already knows how to go about it." And since a similar possibility is excluded in advance from ethical knowledge, it follows that we must characterize the ethical domain as one where technical know-how gives way to deliberation and reflection.

But it is better to show its positive side: in all situations ethical consciousness -- without prior access to the knowledge of all the facts -- is personally responsible for its own decision. Ethical consciousness does not keep counsel with anyone but itself. Thus the whole problem is summarized in the fact that in moral actions there is no prior knowledge of the right means which realize the end. This is because, above all else, the ends themselves are at stake and are not perfectly fixed beforehand. This also explains why in his discussion of phronesis, Aristotle constantly oscillates between defining it as knowledge of the ends and knowledge of means. When it is a question of ethical ends. We can never speak only of the "opportunity" of means; the ethical rectitude of means is an essential component of the ethical validity of ends. To reflect on the means in moral decisions is eo ipso an ethical undertaking.

(3) Ethical knowledge is knowledge-for-the sake-of-oneself. Ethical reflection actually implies an absolutely remarkable re-lation to oneself.6 Techne is concerned with an end which, unlike the end of phronesis, lies beyond itself. Instead, the end of phronesis is to a large extent internal to phronesis. Indeed "making aims at an end distinct from the act of making, whereas in doing the end cannot be other than the act itself; doing well is in itself the end."7 Here phronesis is self-referential.

For this reason, Aristotle makes clear that praxis rules poiesis. Aristotle says: "Thought itself moves nothing; but only thought that is for the sake of something and practical. This indeed rules productive thought also, since he who makes something always has some further end in view; that which is produced is not an end in itself, it is only for something and someone. Whereas that which is done is an end in itself, since doing well is the end, and it is at this that desire aims."8 In other words, the self-referential character of praxis is the rationality for its ruling position with regard to poiesis. This aiming has its own disclosure, a revealing function which is higher than the revealing function of poiesis. In both activities a way of thinking is involved, i.e., an attainment of truth, but the function of practical intelligence is higher than the function of the poietic one, for the former alone is the "attainment of truth corresponding to right desire."9 Phronesis is that practical intelligence properly adjusted to praxis, i.e., practical rationality. And techne is obviously technical mean-ends rationality properly adjusted to poiesis. The implication follows that practical ra-tionality (phronesis) should also rule technical rationality (techne).

Aristotle searches for the common features of all things said to be good. In contrast with Plato who holds that there is a Form of Good in which all good things "participate", Aristotle concludes that there are many different senses of "good", each of which must be pursued by a specific practical art or science, such as economics, military strategy, medicine or shipbuilding. But the ends of these particular disciplines can be arranged in an order of importance, so that the supreme good can be identified with the good of the most general practical science to which the others are subordinate. On an individual level, this all-inclusive science is ethics; on the social level, it is politics.

Aristotle identifies the supreme good with "happiness", which he defines as the exercise of natural human faculties in accordance with virtue. The good of man is defined as the activity of the soul in accordance with virtue, or if there are a number of human excellences or virtues, in accordance with the best and most perfect of them. "What is more, it is this activity throughout a whole life. One swallow does not make a summer, nor one fine day. So one good day or short period does not make a man blessed and happy."10 Therefore, "happy" is a predicate to be used of a whole life. It is lives that we are judging when we call someone happy or unhappy, not particular states or actions. We can see, says Aris-totle, the connection between happiness thus understood and all those things which are popularly thought to constitute happiness: virtue, though not man’s final end, is an essential part of the form of life; pleasure is taken by a good person in virtuous activity, and hence pleasure rightly comes in; a modicum of external goods is needed for characteristic human well-being and well-doing; and so on.11

Hence, we can say, that for Aristotle, a specific ethics of economic activity is not necessary. Since all other particular goods (ends) are subordinated to the final end of life -- the supreme good -- all concrete and particular activities of people are in the last analysis means to the final end of life. Their significance lies in that they can constitute and promote happiness; they serve for attaining the final end of life. What is good in a specific activity, e.g., in economic activity, is a matter of techne answered by a specific science such as economics. Speaking of ethics, general ethics is enough. Doubtless it can answer with regard to economic activity what is good for the final end of our life. In other words, we can distinguish two kinds of goodness in the ethical sense. The former is a matter of economics, and the latter of ethics. For this reason, we do not need a specific ethics for economic activity.

 

CONFUCIUS

 

Confucianism would agree with Aristotle, though based upon its own position. For Confucius, jen is an all-encompassing ethical ideal. Above all, however, the most striking novel aspect of jen is that it does not refer to moral power which is latently present in people. It is an existential goal which one must attempt to achieve for oneself through one’s own self-cultivation. All the "worldly goods" are totally subordinate to the higher goal of jen. But this does not mean that people can do anything to achieve this goal. To act according to the civilized practices of the normative tradition, that is li, is a necessary component of jen. For Confucius, there had emerged within the history of the civilized world a universal and tested body of what might be called in Hegelian terms an "objective ethical order" embodied in the rites, practices, and basic in-stitutions of the tao of the three dynasties, which in its broad outlines already had been realized in human experience and had been lost. That is to say, for Confucius, there was a ready-made system or ethical code; in other words, Confucius already knows what tao is. But this does not mean that there is no moral choice left for people. On the contrary, the choice remains between following the Way and straying from it. In contrast to a vast host of Western moralists, Confucius does not believe that he is creating a new way. Like all traditional moralists he is preoccupied constantly with the choice between following or straying from the Way. Here, the knowledge of li plays a key role. The virtues may exist apart from li, but unless they are governed and contained by the sacred forms of li, they will go astray. "Respect without li becomes tiresome; caution without li becomes timidity; courage without li becomes rudeness."12 The li enlightens people about how and on what occasion these virtues are to be applied; it provides the containing pattern. Without the structuring and educative effects of li, jen as the highest ideal of personal excellence cannot be attained. Li can be internalized only through learning, which implies that only the learned can themselves achieve the highest realization of jen. A man of jen knows what he ought to do in any concrete and complex situation; in other words, he knows how to follow the way in any case.

Mencius believes that humans are born with an innate propensity to achieve the full life. This unreflective spontaneous propensity reveals itself first in the form of certain natural moral sentiments embedded in the human heart, which he calls the four beginnings and which already contain the propensity for the highest moral attainment embodied in the "four virtues". If un-impeded, the evolution of these capacities toward actualization will be realized. There are, however, powerful forces both within and outside the individual which obstruct this evolution. Hence, in most people, for the large part of their lives this original impulse to the good is effectively buried under the accumulated weight of a benumbing callous and evil practice. According to Mencius, there is scarcely difference between human beings and beasts. The only distinction lies in the fact that the human being has moral con-sciousness, which Mencius calls "heart". But in most people, the heart is lost and one has to search for this lost heart, i.e., to cultivate and strengthen one’s moral consciousness. This is the task of an entire lifetime. Sages always keep their hearts, therefore, in them; their heart is unmoved, but common people have to find their lost hearts through learning. Once one finds his lost heart and makes it the unmoved heart in principle she/he can make right choices and decisions and do the right thing in all concrete situations, although at the same time moral decisions still require reflection and deliberate thought. Mencius praises Confucius several times for knowing how to do what is right all the time, whether as a ware-houseman, as a low official, or as one in charge of a herd. In Con-fucianism, the uniqueness of Tao means that ethics is unitary. For this reason, a specific ethics for any specific human activity, including economic activity, is not only unnecessary, but also impossible.

As a result of the rationalization of modern society, however, instrumental rationality, or calculative rationality as Heidegger calls it, has penetrated and dominated all aspects of our life. Benefit, effect and utility become the highest criteria, for eva-luating, whereas both for Plato and Aristotle and for Confucius and Mencius the ultimate principles were non-utilitarian. Today, there is ever more pragmatic prudence, but less and less practical wisdom. Correspondingly we have more and more ethics, including many specific ethics. On the one hand, people need ethics to justify their actions; on the other hand, ethics has to demonstrate its utility for specific human activities, i.e., to show that it can be a means of helping people attain their ends.

But the question remains: Is a specific ethics, e.g., an ethics for economic activity, possible? My answer is: both yes and no; possible and impossible. It would be possible if we accept Weber’s insight: Human progress in the sense of "rationalization" has its complement in giving up the idea of a rational assessment of ulti-mate values or norms in favor of taking recourse in ultimate pre-rational decisions of conscience in the face of a pluralism, or, as Weber says, a "polytheism" of ultimate norms or values.13 In fact, however, ultimate human norms or maxims for acting and eva-luating cannot be based on pre-rational decisions, or "acts of faith", with no rational claim to intersubjective validity. For at this point, no coercive motive remains for grounding one’s life decisions on personal maxims. In the example of an economic ethics there would be no coercive motive for grounding one’s economic acti-vity on striving to keep one’s agreements with other people even in cases where one’s personal interests suggest breaking such an agreement, since no sanctions are to be feared. If so, there would be no ethics. To avoid this, the only alternative is that the dominant principles of technical means-ends rationality be also the principles grounding our moral rules and norms. Such being the case, ethics can be only a technical means to our pragmatic ends. Corres-ponding to all specific pragmatic activities, we should have a specific ethics to justify and regulate them in order to attain their ends. In the last analysis all norms and maxims would be pragmatic and utilitarian. Obviously, the logic of such ethics is no longer that of practical rationality, but of technical rationality. Such ethics can only tell people what they should do for their specific ends, but not what they should do for their whole life. Therefore, though today we have many such ethics, we face an unprecedented moral crisis.

This would be impossible if we could distinguish activity whose end is within itself from activity whose end is outside itself, i.e., praxis from poiesis, or action from working, in Hannah Arendt’s language. According to her analysis, the process of working or producing is definite in character. It has a definite beginning: the blueprint of the product, and a definite end: the completion of the product. It requires definite means and definite abilities.

In contradistinction to this univocity of working, action is thoroughly ambiguous. It falls into a pre-existing network of re-lations and verbal communications with an indefinite and di-versified interplay of perspectives. By virtue of this interplay, which ever renews itself, the agent is a patient as well as a doer and the impact of action is almost limitless and unpredictable. In contrast, predictability rules the activity of working. Moreover, action, whose condition is the plurality of individual lives, is irreversible, whereas in the working process in case of failure one can start all over again. Lastly, in working the agent is not an individual qua individual, but a representative of a species or of general abilities. In other words, working is an anonymous activity. Praxis, in contrast, is individual; at the root, as Aristotle once said, it is the very life of the individual, but related or inserted in a plurality.

For this reason, we need ethics so that we can define the ends of our lives and make moral choices and decisions for our lives in accordance with practical rationality. We can think not only about the good for ourselves; but also the good for all humans on our planet. Obviously, all these are relevant to the meaning and value of our life; they are truly moral and ethical. In contrast, in all work or value-free activities, including economic activity, there are no existential choices. They only obey the logic of technical means-ends rationality. These ends have nothing to do with the meaning and value of the agent’s life. In general, they do not concern what consequences they produce for humanity, for all plants and animals on the planet, or for the earth itself. They would not recognize the logic of practical rationality. They do not need an ethics to define their ends, because their ends are definite and unchangeable. Without ethics they can still work. Because of the essential diffe-rence of these two kinds of activity, an ethics for economic activity guided by practical rationality is impossible.

But this is not the ultimate conclusion. Probably we can still say that it would be possible if someday our practical rationality could revive so much that it could not only give account of the end itself but also of why we have to prefer something to something else. Then it could really rule technical rationality, and economic activity would be subordinate to the good of humans and of the earth. At that time, we could have an ethics for economic activity, but it would not merely justify our economic behavior or help us to better attain economic ends, but would guide our economic activity and make it a means to the final end of our life. It would not be a specific ethics or discipline in the technical sense, but a part of the ethics as our way of life.

 

NOTES

 

1. Cf. Alasdair MacIntyre, A Short History of Ethics (Lon-don: Routledge and Kegan Paul, 1984), p. 267.

2. Martin Heidegger, "Letter on Humanism", in: Basic Writing, ed. by David F. Krell (New York: HarperSan Francisco, 1977), pp. 231-32.

3. Aristotle, Politics, I, 2, 1254, a 7ff.

4. Aristotle, Metaphysics, IX, 8-10, 1069 b 3 sq.

5. Aristotle, Nicomachean Ethics, VI, 4, 1140 a 2ff; 5, 1142 b 3ff; Magna Moralia, I, 34, 1197 a 3ff; II, 12, 1211 b 27ff; Politics, I, 2, 1254 a 6.

6. Hans-Georg Gadamer, "The Problem of Historical Consciousness", in: Interpretive Social Science: A Reader, ed. by Paul Rabinow and William M. Sullivan (Berkeley, University of California Press, 1979), pp. 140-144.

7. Aristotle, Nicomachean Ethics, VI, 1140 a 1-6.

8. Ibid., VI, 1139 a 35; 1139 b 4.

9. Ibid., 1139 a 30-32.

10. Ibid., I, 1098 a 18.

11. Alasdair MacIntyre, A Short History of Ethics, p. 63.

12. Arthur Waley, The Analects of Confucius (New York: Rand House, Vintage Books, 1938), bk. 8, chap. 2, p. 132.

13. Cf. Max Weber, "Politik als Beruf", Vortrag 1919; repr. in: Gesammelte politische Schriften, 2nd ed., pp. 493-548.

 

 

 

they engage in further studies to give play to their potentialities or to develop their interests, so that they will be more competitive when they take up a career after their children have grown up. Such exploration is praiseworthy under the conditions of a modernized economy; it advances the civilization of the whole society.

Third, the high educational level of society, the high degree of democracy and the modernization and socialization of house work due to the modernization of the economy will enable women to elevate their quality as human beings, to demonstrate their personality, to strengthen their competitive power in social life, and to realize a sound personality. There will be a day when we need no longer emphasize that the male and the female differ and recognize that there is something common to both sexes. Then the peculiar and varied beauty of the character and personality of the female will demonstrate itself naturally in the world.

Of course, molding the female personality depends not merely on the progress of economy and is not merely a matter for women alone. It depends on the consistent efforts of the whole society; this requires theoretical work by scholars to find the incompatibilities and in time eliminate them.