I began by noting that "Capitalism is too important and complex a subject to be left to economists." But I could equally have said that "morality is too important and complex a subject to be left to philosophers." In our society, defenses of the market come primarily from those concerned with economic and material well-being. Those who see themselves as the protectors of morality are more likely to be antipathetic to the market. I want to focus on the positive moral effects of the market that tend to get overlooked in narrowly economistic discussions about production and distribution. So the "good arguments" in my title refer to plausible but often overlooked insights into the beneficial moral effects of the market. Many of these benefits also have potential costs -- which I want to note without elaborating, since they tend to receive the most attention from moralists.

One perennial pitfall in thinking about the moral effects of capitalism is issue of comparison. When philosophers ask about the morality of capitalism, they too rarely ask "compared to what"? Of course capitalism is morally inferior to many a philosophical utopia. And our comparative evaluation of capitalism is further skewed by the fact that when we compare capitalism to past regimes, it is often implicitly from the perspectives of those who profited most and suffered least in past systems -- from the perspectives of lords rather than serfs, of masters rather than slaves, aristocrats rather than commoners.


With that caveat in mind, let me turn to the first argument about the positive moral effects of the market, namely the link between individual autonomy and self-support through legally free labor. Adam Smith famously wrote that:


It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages. Nobody but a beggar chooses to depend chiefly upon the benevolence of his fellow-citizens.


This passage is most famous as a statement of the potential utility of self-interest. But notice its assertion that dependence upon the benevolence of others is morally degrading and hence something we should try to avoid if possible. Thomas Carlyle, and later Marx and Engels would decry this system of mutual appeals to self-interest as "the cash nexus." But the flip side of the cash nexus is first of all the freedom and self-determination that comes from having cash, and second the fact that relations based on cash do not involve the total subordination of one individual to the will of another -- the characteristic forms of human relations under slavery or serfdom. Nor does it involve the subordination of the individual to the will of the state and its officials, characteristic of socialism. That is why Hegel insisted that supporting oneself by earning a living is one of the most important ways in which men get a sense of themselves as individuals. What he called "the ethic of bourgeois society," includes a commitment to "the activity of supporting oneself through reason and industriousness."


All of this has dark sides, potential and real. It may lead us to a mindless commitment to work at the expense of other goods. It may lead to the belief that personal value comes only from paid labor, leading to a fear of dependence on others, or leading us to underinvest our time in vital but unpaid activity.


The second argument asserts that the moral quality of self-support arises in good part from the fact that it so often extends beyond the individual, to his or her family and descendants. This argument reminds us not to confuse self-interest with selfishness, for the "interests" we pursue in the marketplace often involve more than just ourselves. As Burke part it "The power of perpetuating our property in our families is one of the most valuable and interesting circumstances belonging to it, and that which tends the most to the perpetuation of society itself. It makes our weakness subservient to our virtue; it grafts benevolence even upon avarice."


Or as Hegel explained, it is in the family that the self-interested actors of the market become members of a collectivity to which they are emotionally attached. It is this collective interest that gives property and self-interest a very different meaning. It is the desire to form a family that often makes it necessary to acquire a continuous stream of income in the first place, and property is an integral part of family life. "The external and public reality of the family is its wealth," Hegel writes, "its family fortune, which forms the basis for the survival of its members." One way in which the love and deep obligation that characterize the family are expressed is by earning a living in the marketplace. In the search for familial wealth, Hegel says, self-interest and selfishness are transformed into concern for something shared.


The potential dark side here is that a commitment to the support of one's family can overshadow our concern with the well-being of those beyond our family. It can serve as a motive for civic neglect, or even fraud.


The third argument is that the market leads to a self-interested concern for others, to what one might call non-altruistic reciprocity. This takes several forms. First, as Adam Smith pointed out, regular market relations are conducive to the development of honesty. This insight has been rediscovered by contemporary game-theorists. For re-iterated multi-lateral exchange creates incentives to develop the trust of other players by scrupulous action. That is why merchants out to make a single sale to a customer are more likely to engage in fraud, while those who seek return business have reason to be honest. It is why successful companies have generous return policies and offer money-back guarantees. It is why companies that want to attract and retain investors strive for financial transparency. (Whereas executives out to make a single "killing" have no such incentive.)


Another way in which the market conduces to the development of a concern for others was explored by Hegel. Because we are dependent on others to meet our needs, and because we can only earn money by supplying their wants, we are forced to orient ourselves to other people, and take an interest in what they think and want. The link of self-interest to mutual concern is expressed in the sales clerk's "Can I help you?" That phrase is often scorned -- except by those who have lived in societies where sales clerks, for lack of institutional incentives, habitually ignore potential customers. Seen from the heights of moral rigorism, such commercially motivated solicitude is evidence of the lack of true charity and altruism. Seen historically and comparatively, the market's ability to create a self-interested regard for others is preferable to the alternatives: to gaining from others by brutal means; or to the indifference which most often characterize the relations of imperfect men and women toward one another.

George Simmel carried this argument an interesting step further, in his discussion of competition and its effects on entrepreneurs. Competition, he pointed out, is not only a relationship between those who compete, it is a struggle for the affection -- or money -- of a third party. To compete successfully, Simmel noted, the competitors must discover the wishes of that third party. Often, competition "achieves what usually only love can do: the divination of the innermost wishes of the other, even before he himself becomes aware of them." And he was right: how many of us divined twenty years ago that you would need computer on your desks? How many of us divined ten years ago that you could hardly live without a high-speed internet connection? This competition for customers and consumers had a highly democratic aspect as well. "Modern competition," Simmel observed, "is often described as the fight of all against all, but at the same time it is the fight of all for all." Competition, he wrote forms "a web of a thousand social threads: through concentrating the consciousness on the will and feeling and thinking of fellowmen, through the adaptation of producers to consumers, through the discovery of ever more refined possibilities of gaining their favor and patronage."

Each of these moral benefits has its potential dark side: self-interested solicitude can lead to complete inauthenticity, a sense of always selling oneself. That is why it has been so consistent a theme of social criticism from Rousseau through "Death of a Salesman" and beyond. The creation of ever new needs -- when not bounded by a sense of priorities and of how new commodities fit into our life-plan -- may put us on a treadmill of joyless consumption.

The fourth argument is that capitalism creates ever wider forms of association. From Smith through Friedrich Hayek it has been pointed out that commerce links us to foreign peoples, who we come to regard not as barbarians but as potential suppliers and potential customers. Capitalism creates an awareness of their needs and wants, and to the extent that we view them as customers for our products and as producers of the goods we hope to consume, we become linked to them. One effect, as Marx put it, is that "National one-sidedness and narrow-mindedness become increasingly impossible, and from the numerous national and local literatures, there arises a world literature." And one might add, a world music, a more cosmopolitan cuisine, and an exchange of ideas such that there are more and more Buddhists in the United States and more and more classical musicians coming from South Korea.

A related argument holds that capitalism leads to a diminution of religious and communal antagonism. Indeed one of great arguments in favor of capitalism is that it diffuses cultural and religious sources of conflict. It does so by creating incentives to cooperate with those of differing ultimate commitments, leading to a greater zone of indifference to the ultimate goals of others. We find this argument in Voltaire's description of the London stock exchange in his Philosophical Letters:

Come into the London Exchange, a place more respectable than many a court. You will see assembled representatives of every nation for the benefit of mankind. Here the Jew, the Mohametan and the Christian deal with one another as if they were of the same religion, and reserve the name "infidel" for those who go bankrupt.


It is their shared focus on a common means -- money -- that diffuses their religious antagonism. Money, Simmel claimed, is the ultimate means. And minds ever more oriented to the weighing of means, Simmel tells us, become more tolerant, more conciliatory, because, focused on means, they are less concerned about to the ultimate ends of others. Spending less time thinking about ultimate salvation or perfection and more on obtaining means, they become more indifferent to the divergent ways in which others seek perfection or salvation.


Of course this creation of wider forms of association is itself a source of moral complaint by those who champion cultural and religious particularism, who rightly view trans-cultural contact as a threat to their inherited identity, at least in its traditional form.


The last argument worth considering is that capitalism creates new and more complex forms of individuality. Simmel suggested that the limited-liability corporation was a model for many characteristic forms of association in an advanced capitalist society. Individuals cooperate with a limited portion of their lives for common but limited purposes. In previous societies, one's status as a peasant, artisan or merchant often defined one totally. Being a member of a guild, for example, encompassed a complete set of social roles -- economic, legal, political, and even religious. Modern market society, by contrast, is based upon looser, more temporary associations, founded to pursue specific economic, cultural, or political interests. Such associations demand only a small part of the individual, sometimes only a monetary contribution in the form of dues. As a result, the modern individual can belong to a greater range of groups, but groups which are looser and less all-encompassing. In contrast to earlier forms of association, modern associations allow for participation without absorption. They make it possible for the individual to develop a variety of interests and to become involved in a wider range of activities than would otherwise be possible, yet to do so without surrendering the totality of his time, income, or identity to any particular association, from the family to the state.


Under such circumstances, individual identity arises from the set of one's interests and associations, a set different, in theory at least, for each individual and valued precisely because it is voluntarily chosen. I am a husband and father, a Buddhist, a jazz aficionado, a molecular biologist, a marksman, and a reader of modernist fiction. What is remarkable, and historically new, is the possibility of being all of these things at the same time. Being any one of them does not entail the others, and so my identity, my sense of myself as an individual is constituted in large part by the choices I have made and the intersection of interests that come together in me. And that choice of possibilities is made possible in no small part by the market. It is the division of labor which makes it possible for me to specialize in molecular biology: and to be productive enough to make enough money so that I can buy much of what I want, instead of having to make it for myself.


The dark side of this argument is the danger of the development of a protean self, without a set of binding commitments to any one or any thing; where the bottom line of every social contract is the escape clause.


There are, no doubt, plenty of good economic arguments about how (under the right conditions and in the long run) capitalism has made nations better off materially. And there are plenty of good arguments about the moral hazards of a market society. But there are also good arguments about its moral advantages, and these should not get overlooked in discussions about globalization. Many of the moral advantages and conceptions of selfhood that those in capitalist societies take for granted are due in no small part to capitalism itself.