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Jean Bethke Elshtain


Everything for Sale

In an entirely free market, nothing is sacred.

A headline on the front page of the New York Times for March l9, 1997, one clearly designed to tug at our sentiments, proclaimed: "4,000 Hearts Full of Hope Line Up for 700 Jobs." And the article was effective. We learn of Gayle Blanding, who put on her best dress and kept repeating over and over: "I have great confidence. I have great skills." But the "38-year-old unemployed woman still trembled as she rode the A train from Harlem to midtown Manhattan yesterday" despite the fact that her l9-year-old daughter kept whispering into her ear: "You're going to get that job."

Lasidy Honoret had taken an unpaid day off from his $5-an-hour cook's job in order to apply for a position as a staff member at the Roosevelt Hotel in midtown Manhattan, reopening soon after renovations. An 18-year-old kid? No, Mr. Honoret is 33, from the Dominican Republic, and a lawyer in his old life. He has worked in factories and supermarkets since he hit New York. He had had a dream of going to Harvard and of sending money back to his 7l-year-old mother. But now he's mashing potatoes at a Boston Market and wondering why he left home. Well, you get the picture. Seven hundred jobs. An explosion of applications. The hotel expected l,000 folks to show up. Four thousand did. The police had to erect barricades to help shuffle the surge of hopeful and desperate humanity along in an orderly way.

For most of us, this is an unhappy story. Seven hundred people will get decent jobs, at least by comparison to what they are now doing and earning. That leaves 3,300 hopefuls shorn of hope. It's the way the market works, we will be told. It's the way the market must work. But for us noneconomic types, something is amiss. We think there should be more and better jobs. We think that a trained lawyer should probably be doing something other than doling out mashed potatoes at a chicken chain. But then we remember other stories. This is America. You've got to start someplace.

A few of us recall tales told by our immigrant grandparents. My grandfather, who was bitter about this to his dying day, described his first Christmas Eve in America. A hired farm hand, he was forced to shovel frozen cow manure out of a barn on a bitter Colorado night, the icy blast off the dry plains chilling his bones and his spirit. He never got over it. It wasn't the hard, even brutal, and, to his grandchildren, demeaning work that got to him—that was to be his lot for years. By then, he had already learned that. The new country, this America, didn't have streets paved with gold. His bewildered, poor family had been greeted by no welcoming committee. Those in Nebraska, then Colorado, who worked the immigrants but also derided them (at least some did), mocked his awkward attempts to speak the English language. But it wasn't that which still rankled decades later. It was that he had to work Christmas Eve. Was nothing holy?

The answer, I suppose, is that nothing is holy in a world of perfect markets. Everything is up for sale. But markets never work perfectly. So some things are off limits. Or, at least, they used to be. No more, argues Robert Kuttner. He is joined by Margaret Radin, a law professor responding to the triumph of the "law and economics" school in her own profession. Kuttner, the economist, offers the clearer exposition of the move to redescribe nearly everything in our lives (families, churches, the law, bodies, and body parts) in econometric terms. But both Kuttner and Radin are arguing with or against the Chicago School, associated with Milton Friedman, now with Gary Becker and other important (and Nobel Prize-winning) economists as well as with such formidable exponents of law and economics as Richard Posner and Richard Epstein, also of the University of Chicago. So this is a Chicago thing, and my own position at that extraordinary institution only deepens the Chicago connection, here in a spirit of debate.

Echoing Sean Connery from The Untouchables, what does it mean to "do things the Chicago way"? It may mean finding a recent New Yorker cartoon not only funny but true. Two dogs are sitting at a bar. One dog, leg crossed, drink in hand, opines to the other dog: "It isn't enough that dogs win. Cats must lose." Somebody's got to lose if life is a zero-sum game: every gain is also a loss. All of life is viewed through the prism of maximizing utilities. Everybody is looking out for his or her marginal advantage. If we all do this, outcomes will be "optimized" and everybody will benefit, at least somewhat. You may be a loser but if enough people are winning, the "outcome"—a rather mysterious aggregate—shows a plus on the ledger, and things are better even though you might not be better off.

Everything for Sale:
The Virtues and Limits of Markets
by Robert Kuttner
Alfred A. Knopf
410 pp.; $27.50, hardcover

Kuttner, whose book is elegantly written, summarizes twentieth-century economic theory and history with great aplomb. He unpacks the libertarian strain now prevalent, even triumphant, in many quarters. Libertarianism at the moment means take off the controls; loose the fetters; give the economy (and the individual) the freest possible rein. Kuttner, who believes everything works best, including the economy, if markets are not unleashed but are balanced in a complex world that includes a decent state and a vibrant civil society, nevertheless offers up a paean to the accomplishments of the market that rivals anything to be found in the Communist Manifesto, that canonical celebration of what markets and the bourgeoisie have accomplished.

Before Marx takes to smashing things to bits, he marvels at the extraordinary energy and vibrancy of capitalism. Transformed social relations born. Worlds explored. All that was once solid melting into air as markets both dissolve and create. Kuttner emphasizes the broad choices markets provide, the innovation markets require, the wonderful way markets bring together investors and entrepreneurs and consumers in cooperative ventures that decentralize decision making. He does not pine for command economies. They failed, and they are doomed to failure.

In fact, in writing his book, Kuttner emerged with "increased respect for the power of markets and the complexity of the story—yet with renewed conviction that the good society requires a mixed economy." The market's virtues help to account for why communism failed so miserably. In addition to trampling civil liberties and laughing cynically at political democracy, communism destroyed the price system. Inefficiencies piled up in a grotesque manner. Shoddy goods couldn't reach desperate consumers. Shortages mounted. Pollution soared. The thing finally collapsed of its own weight.

But an entirely free market is no day at the beach either. How so? Well, for one thing, if marketization isn't modulated and ameliorated, it swamps other goods, including the polity itself. Concentrating on the microeconomic realm, where contemporary economists believe the market succeeds most if not all of the time, Kuttner piles up one irritant in the image after another. He sees himself as the defender of a sensible middle ground, beginning with the insistence that, pace econometric libertarians and utility maximizers, "many forms of human motivation cannot be reduced to the market model of man." So the job of the responsible critic is not to condemn the market wholesale—that is not only irresponsible, it is stupid and self-defeating because the market does so much so well—but, instead, to ask where the market model serves as a "reasonable approximation of human motivation" and where it does not—where, in fact, it is deeply misleading.

We Americans with our great economic engine recognized this a long time ago. Our market has never been entirely unregulated. In times of crisis—Kuttner reminds us of World War II—we grossly violate the norms of "allocative efficiency" by setting wage and price controls, rationing, offering monopolistic military contracts, and all the rest. More routinely, we work to guarantee the hygiene of products; to promulgate consistent unit pricing; to ensure nutritional labeling on foods. We do this, in part, because we know that consumers can never possess the "perfect information" dear to free-market modelers. Kuttner rightly points out that this is almost "never literally true." Consumers, much of the time, may be maximizing their (perceived) well-being when they purchase goods and services, but they can't go just anywhere to get the best deal, and their choices are influenced, pressured, encouraged, and, in some instances, even coerced by forces outside themselves.

This is a hard truth for the ideologists of utility maximization to acknowledge. For them, the consumer's taste is a preference that, well, reflects the consumer's taste and does so in the absence of "significant externalities," a way of talking about social costs such as pollution or threats to public health.

This cues us in to when markets fail. Health care, for example, "violates all the premises of an efficient free market—perfect competititon, perfect information, mobility of actors." In fact, under the current regime of managed care, Americans are getting a lot more management and considerably less care, or so it seems to be shaping up. So Kuttner aims for what he calls a "Second Best" option. Sure, let the market run when it works out for the best, when the "voluntary cooperation of individuals" and a reasonably free and fair situation pertains. But be prepared to regulate reasonably when markets don't work like that. It simply isn't the case that regulation always makes things worse, as the market model insists. The history of banking regulation, for example, tells a different story. Our alternatives, then, are not centralized control or a pure or purer market. There is no one size fits all. Human societies "plainly need norms of behavior other than the short-term, instrumental, and purely egoistic norms of the market."

There are all sorts of anomalies the theory cannot handle, Kuttner claims. It cannot explain why folks engage in acts of moral supererogation, and when it tries, things get ridiculous fast. Moreover, the market relies on nonmarket values and virtues. A decent free market cannot thrive in the absence of trust and promise keeping and other verities that the market depends upon but cannot sustain alone. Markets require lots of help from nonmarket institutions and relations. If we fail to recognize this, we wind up in absurdity or worse.

Kuttner cites a shocking paper that tried to "dispatch the issue of slavery by branding it economically inefficient"—the gravest indictment the market model can bring. It works like this: slavery was inefficient not only for the slaves but also for observers of slavery who suffered from "uncompensated third party effects"—that means they felt bad knowing that fellow human beings were enslaved. So this latter "externality" is counted as a cost, and slavery is indicted—with a poof ball rather than a moral mallet. Clearly, a resounding critique of slavery demands going outside econometric terms narrowly defined.

But this contemporary free-market celebrants are loath to do. So, for example, if you want to talk about public goods and political life in market terms, you embrace something called "public choice theory." That means you keep behaving the way you behave in the market as everyone always maximizes his or her own well-being. Thus, elected officials have one goal only: getting re-elected. Every group gets involved in politics only to win benefits for itself at the expense of other groups. There's just enough truth in this that we find ourselves nodding our heads and saying something like: "Yeah, there's way too much of that. But, surely, there are more capacious, fairer dreams of politics."

The market drives out nonmarket institutions. Even our great civic holidays get reduced to a political recreation.

Dreams, aye, there's the rub. Some years back at a university where I taught previously, an eager young job candidate came through. He was a political scientist deeply immersed in the public-choice model. Everything was a preference. Everything was about winning at someone else's expense. There was simply no other way to talk about politics. Mantra-like, this went on for an hour. When he had finished, I asked: "Curious thing. When Martin Luther King delivered his great speech, he cried: 'I have a dream,' not 'I have a preference.' How do you understand this? Is there a difference?" Bombshell. Dead silence. Much sputtering and stumbling. Later, I was told by a colleague that I had been rude. Rude? I had kept a civil tongue in my head throughout! Since when is it rude to challenge a theory that has become self-enclosed, self-replicating, totalizing?

The smart public-choice theorists understand this, I think, but there are lots of not-so-smart ones running around promoting a closed way of thinking in the name of maximizing all our utilities, day and night, and like Energizer Bunnies we keep on going … and going … and going. And this is all done in a way that will "adjust preferences" at the margins—here lots of virtuouso mathematics may be brought to bear—but the axioms of the theory itself are never open to dispute, as Amartya Sen's classic essay, "Rational Fools," noted by Kuttner, argues. The bottom line is that the language of "justice, virtue, charity, ethics, public-mindedness" falls by the wayside in favor of relentless commodification. The sweep and scope of commodification—what's up for sale?—helps to divide older (more Burkean) from econometric conservatives, and it also divides most of us from those same conservatives.

Why? Because we actually do believe in the possibility of commonalities and solidarity. This means, in practice, that we hold that self-interest must, as Kuttner notes, citing with approval Catholic social thought, be tempered by more communal concerns. But this recognition is under tremendous pressure to succumb to a surround that puts us—all of us—smack dab inside a whirligig of relentlessly generated "wants" that translate rapidly into "needs." So all of us get caught in a vicious circle. We pursue more material satisfaction because we need (read: want) more. But the more we want, the more we "maximize preferences" and the more we have to work or pay others to do work for us. We have less time for children; less time for spouses; less time for friends; less time for sociability in all its many varieties. And, as I indicated, this can get truly weird when even religion becomes a system for expected utilities postmortem.

The upshot: the market (thus understood) drives out extra or nonmarket institutions. Kuttner reminds us that even our great civic holidays get reduced to apolitical recreation. (Consider, for example, the evolution of President's Day: the fusing of Lincoln's and Washington's birthdays and the ignoring of both for the sake of commerce.) Society pays a price as reciprocal norms vanish. Perhaps one reason trust is so low among us at the moment is that commitment is so casually breached. When everything is up for sale, "the person who volunteers time, who helps a stranger, who agrees to work for a modest wage out of commitment to the public good, who desists from littering even when no one is looking, who forgoes an opportunity to free ride, begins to feel like a sucker." Just a damn fool. Yet the signs of hope linger. Even game-theory experiments, launched in the expectation that each individual would "free-ride" and "hope that somebody else will worry about the general welfare," show that most folks "will contribute a share of windfall winnings to the public good," quite in opposition to the expectations of the theory.

It seems, in fact, that the market is often the free-rider, dependent in ways its celebrants cannot acknowledge on extra-market values. But those values, as I have already argued and as Kuttner insists, are fragile and ceding territory every single day. And the big engine that never rests is harder and harder to restrain and to limit in any way. Mind you, Kuttner offers a resounding critique of overregulation and points out the curious paradox that left-wing critics of "regulatory capture" (the regulators wind up regulated and in bed with those they are supposed to oversee, so nothing really gets done, or the wrong things get done) traffic with many conservative critics who disdain the very idea of regulation but who view it with equal cynicism.

"Byzantine complexity" (Kuttner's description of the Clinton Health Care Plan that went down in flames) is not the way to go. Instead, we need modest, fair, and efficient regulation of the sort that we already have in many areas and that has been shown to work well. Most of the dynamic industries of this American century, from electric power to telecommunications to aviation, emerged as they did in a regulated environment. Procompetitive regulation, Kuttner calls it. And it is a far cry from older notions of the Total Well Regulated and Managed System. We are clearly well done with that.

So, Kuttner concludes, we require a more social economics, one less dependent on higher math and more dependent on decent values. If we do not generate a sufficient number of roughly fair outcomes over time, no social solidarities get built. Political support for policies and programs that turn on a tacit social contract dwindle, and the pressure to divert resources to individualist, privatized alternatives grows. We wind up with an often nasty form of rationing, not under the auspices of government but under the sponsorship of the market.

For example, a system that "spends millions keeping alive twenty-week premature babies, and subsidizing in vitro fertilizations, but has forty million people without basic health coverage, is also rationing." And rationing pretty inefficiently as many of those without coverage seek the most expensive form of care—the nearest ER—when they get sick.

There is plenty to worry about, baleful stuff that seems to warrant the label "the dismal science" for economics, or at least the triumphant form of economics Kuttner criticizes. Here is one example involving how to cost-out the value of a human life. You need two scales, one called DFE (Discounted Future Earnings) and another labeled wtp (Willingness to Pay). The former "values a person's life by projecting the value of lifetime earnings lost because of premature death or disabling injury, and then discounts into present dollars to adjust for future inflation." The second metaphor literalizes those surveys in which people conjure abstractly with what they think life and health are worth. Put these together and you have a value you can assign to a life.

Problematic? You bet. It might mean, for example, that a handicapped person whose dfe is next to nil is costing society, and his or her death would yield a "net benefit." Now, nearly all of us would resist this conclusion. But on what grounds? For grounds you have to go outside market values. But, if you are a utility-maximizer in the guise of an ideologue (or the other way round), you are not by definition permitted to do this. We are, at such a moment, inevitably drawn back to moral precepts and ways of being in the world that cannot be captured in the language and the dynamic preference aggregations of market theory.

Increasingly, then, we are using the market in illegitimate ways. Any serious tour through markets "takes us back to politics," Kuttner insists, and when we do this we recognize that the Holy Grail of a "perfect market" is a delusion. There is simply no escape from politics.

At this point, it would have been a real boon had Kuttner kicked in a few of the inescapable political terms—justice, fairness, order, authority, liberty, and power—but he does not, so his view of politics is somewhat sanitized. We hear about trust and civility and long-term commitment, to which Kuttner adds "the art of consensual deliberation." Why consensual? Why not the art of democratic argument that, from time to time, yields political agreements and provisional commonalities that we can all more or less live with even as we go on to fight another day?

Some of those who are heroes to Kuttner, like Woodrow Wilson, were in fact often ferociously nasty when it came to what were called "hyphenated Americans" or, in the delicate Wilsonian formulation, characters poised with daggers in hand ready "to plunge" into the heart of the Republic. Where Wilson saw a nation "hamstrung by narrow and seesawing partisan alignments" and "substantial corruption," others saw real politics and the growth in political clout of immigrant groups who had endured hardscrabble lives in order to carve out some political terrain for themselves. Progressivism, in one of its guises, was as much about breaking the back of immigrant political power in the cities as it was about anything.

Kuttner is big on deliberation "leading to social learning, institutional refinement, and an evolving conception of the common good." This isn't a sufficiently contrarian, messy reading of democratic political life to describe fully and fairly our political history. But Kuttner's insistence that we need political democracy—that citizens must have political institutions and markets within which they can hone political skills, and that we, as a society, falter when this doesn't happen—is welcome. If we don't do this, we will wind up with a situation in which the biggest winners can buy their way out of the pathologies the system generates and the rest are left to pick up the pieces.

If we hope to avoid this worst-case scenario outcome, some domains must lie "beyond the reach of politics," for they "belong to the province of rights, which by definition cannot be alienated or sold." For Kuttner, these include the sanctity of one's person—human beings "may not be sold, no matter how great their desperation"—a prohibition on quashing free speech and on the buying and selling of office and votes. Strikingly, however, despite his passing references to Catholic social thought, Kuttner omits any reference to churches. Yet the available data show that persons of religious commitment are less likely to free ride—that means they are more likely to be good stewards and neighbors—and, as well, that skills learned as members of congregations are "transferable" to other arenas, including politics and civic life generally.

If our economist gets an "A," how well does the law professor fare? Somewhat less well, I'd say, and the reason lies in the fact that, by contrast to Kuttner, Radin is far less prepared to take on the strongest articulators of the view that little, if anything, is off limits to markets. Much of the time she seems to be tied up in conceptual knots as she works both to affirm and contest the arguments and claims of the commodifiers.

Radin begins energetically: it simply isn't the case that everything has a price. She would resist "excessive commodification" via a "pragmatic philosophical and legal approach to thinking about some of our contested commodities—those that are related to persons and the nature of human life." Commodification is one kind of "social construction." But there are others. With Karl Marx at one end of the scale ("universal noncommodification") and Gary Becker and Richard Posner on the other ("universal commodification"), Radin sets sail. She wants a middle way, but she doesn't want it to look like "traditional liberalism." Why? Because traditional liberals (she singles out Michael Walzer as an example) claim that some spheres of life should be construed as entirely noncommodifiable. For Radin, this is problematic. It leads to "separate spheres," a cardinal sin in feminist analysis, and invites a view that permits those who endorse it to prettify situations in which a bit of commodification may not be a bad thing.

Radin resists the commutable and universally commensurable world of the commodifiers because it cannot capture and may well "debase the way humans value things important to human personhood." In her schema, it is always humans placing all the value. Nothing is valued intrinsically apart from humans giving it a value. So we are in an exclusively anthropocentric universe. In such a universe, those who would hold some things outside the market (market inalienability) are making a claim that such things (like babies) should never be "treated as a commodity." But that isn't Radin's world.

Yes, she frets as we all must about selling "infants and sperm, eggs, embryos, blood, organs, sexuality, pain, labor." Should all or none of this "come under a market regime"? It can't be all or none, she argues. So it is some of the organs for sale some of the time. Radin wants restraint on such selling, but not via the "traditional liberal view" that she taxes with preventing us from "seeing fragments of a nonmarket social order embedded or latent in the market society."

Contested Commodities:
The Trouble with Trade In Sex, Children, Body Parts, and Other Things
by Margaret Jane Radin
Harvard University Press
279 pp.; $35

This doesn't hold water as an articulation of the "traditional liberal view," but never mind. Let's get to a really juicy issue, like selling kidneys or bodies. Taking exception to Walzer's (and Kuttner's) absolute ban on "desperate exchange" (selling a kidney because one is poor) because such a ban may well be contrary to "respect for persons," under certain circumstances, Radin finds herself deeply troubled nonetheless.

Let's say that a sale of a kidney takes place under desperate circumstances. Don't we "add insult to injury" if we prohibit such sales entirely? Might we not then cause the starvation of a mother and her children, folks who might not have starved if the Bangladeshi Mom had been able to sell her kidney? Surely, this is a strange way to argue. If we say: Selling organs is a terrible but permissible form of commodification under situations of desperation and we should, therefore, legalize such transactions—then we disarm ourselves. It will be ever more difficult down the road to take a strong stand against the selling of kidneys.

Surely the best way to make the moral point is to say that it is wrong—dreadful—for kidneys in Bangladesh to go to wealthy payees in the West. We will never legalize this sort of thing. This doesn't mean we will punish the desperate seller; it does mean we would, if we could, punish the mercenaries trading in organs for a profit. If we say we cannot say any such thing because we are adding "insult to injury" for desperate people, and because we, being decent folks, are also worried about "maldistribution of wealth" and not just about commidification, we tacitly promote the view that, worried about maldistribution as we are and not knowing what else to do about it, we proclaim, in effect: Let them sell kidneys!

This isn't an outcome Radin wants. It isn't one she endorses. But it is one that arises when the regime of "incomplete commidification" is built on a slippery slope, and grotesque activities slowly but surely get normalized. In Radin's world, we can't worry about one thing unless we worry about everything. So if we worry about kidney sellers (who are "disproportionately poor people of color"), we must also worry about "wrongful racial subordination" and, if we do that, we cannot forbid kidney selling. That seems to be the upshot.

Every controversial matter Radin takes up gets parsed in this way. Obviously a decent and humane person, Radin cannot quite bring herself to condemn the practices she finds inherently troubling. Take baby-selling.

Suppose you have a poor woman who wishes to sell a "baby on the black market" even as she may "wish to sell sexual services, perhaps to provide adequately for other children or family members." What's wrong with this picture or with these activities? Selling sexual services can be justified (commodified) incompletely, for Radin. But on the baby front, there's a problem because the babies aren't choosing for themselves. Baby-selling seems like slavery to us. But if this is true, and if the heart of the matter is that babies can't choose, then how do we justify adoption? Here babies are given away—released for adoption—even though they haven't chosen. So if we forbid baby-selling, maybe we should forbid adoption, too. If parents are "morally entitled to give up a child," and if we are opposed to slavery because that is trading in human flesh, why shouldn't we forbid all exchanges, whether commodified or not?

Having knotted herself in this way, Radin hints that there may be one reason we can eke out for why adoption is preferable to selling, and that is because adoption remains lodged in a "nonmarket version of human beings"—a version of who we are that "will become impossible" if market discourse triumphs utterly. This is a pretty snarled way to suggest one thinks baby-selling may not be such a hot idea.

One final vexation, this in the matter of buying and selling "reproductive capacity" in prostitution, surrogacy contracts, and the like. Radin counterposes Catherine MacKinnon's "painful" view that there is no clear dividing line between hetrosexual intercourse "that is genuinely desired by women and the sort that is unwelcome." There is no such line in MacKinnon-Land, because women are running around with their consciousness all twisted and distorted by male dominance. As a result, female desires are an enemy camp poised within, lurking to do women harm in the name of what they may think, falsely, that they actually desire. As I indicated, Radin describes this view as "painful" and "threatening." That it may just be wrong; that one may not find it not at all "threatening" but spurious doesn't seem to be an option.

Radin contrasts the MacKinnon view of women's abject state with a second position, one in which all of a woman's—any woman's—"subjective experience" should be treated with "acceptance and respect." Radin finds this "less threatening" but problematic because we cannot move to a "social conception of sexuality that is less male-dominated if we do not regard with critical suspicion some of the male-dominated experiences in which we now take pleasure." An example of what experiences Radin has in mind would have been helpful here; moreover, the relativist posture that anything goes if a woman says it's cool is so palpably ludicrous one wonders why it is accorded any credibility. There are female monsters aplenty who take pleasure in cruel and horrible things, and there are strenuous grounds—much sturdier than Radin adumbrates—to criticize, to shun, and to oppose what it is they do.

Radin winds down with a defense of Deweyan Democracy by contrast to public-choice theory. If we but apply Dewey's method of experimental intelligence, without dogma and sans a priori generalizations, we will "design institutions" that help us to "avoid corruption," and to change human nature as the "culture changes" in something akin to a "dynamic systems model" feedback loop. For Radin, when all is said and done, we are our preferences. She, too, accepts the dominant term of the position she sets out to criticize. But these preferences bring law into being, and law gets squeezed out by the utility maximizers who define the "feedback loop" between preferences and law "out of existence"; hence, theirs is a "retarded science at best."

This is a pretty anemic defense of democracy, Deweyan or any other. Whatever happened to "we hold these truths" or "with charity for all" or, yes, "I have a dream"? Are these no more than faint echoes as the curtain comes down on the twentieth century?

Jean Bethke Elshtain is Laura Spelman Rockefeller Professor of Social and Political Ethics at the University of Chicago.

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