St. Maximos' Hut

Ethics and Markets
There is an excellent column in the 8/24 Financial Times by Frederik Segerfeldt on privatization and water markets. (The full text is available only to subscribers, unfortunately.) Segerfeldt is the author of a recent book on privatization and water, Water for Sale: How Businesses and the Market Can Resolve the World's Water Crisis (Cato Institute). (I have some other comments on this column over at The Commons.)

Of interest here in The Hut are two points Segerfeldt makes:

1) "The main argument of the anti-privatization movement is that privatization increases prices, making water unaffordable for millions of people. In some cases, it is true that prices have gone up after privatization; in others not. But the price of water for those already connected to a mains network should not be the immediate concern. Instead, we should focus on those who lack access to mains water, usually the poorest in poor countries. It is primarily those people who die, suffer from disease and are trapped in poverty."

This seems like a very strong case that a Christian concern for the poor mandate support for privatization - the immediate, direct beneficiaries of privatization are the "poorest in poor countries." There are certainly other ethical obligations imposed on Christians (to donate to charities that help the poor, to participate in such charitable works, etc.), but here we have a direct, simple measure that will improve the lives of the very poorest. Yet we don't often hear (in the mainstream media) about the ethical imperative to promote such policies even as we get bombarded with Live8 style pitches for government policies (debt relief) that primarily benefit governments (and some not very nice ones at that) rather than people.

2) Segerfeldt writes "There is another, less serious argument put forward by the anti-privatization movement. Since water is considered a human right and since we die if we do not drink, its distribution must be handled democratically; that is, remain in the hands of government and not be handed over to private, profit-seeking interests. Here we must allow for a degree of pragmatism. Access to food is also a human right. People also die if they do not eat. And in countries where food is produced and distributed 'democratically', there tends to be neither food nor democracy. No one can seriously argue that all food should be produced and distributed by governments."

When I read this passage, I was reminded of a radio show I heard many years ago, while driving across West Texas. One minister recounted how another minister had told him how God had answered his prayers and healed a headache the second minister had before a major sermon. The first minister commented on how arrogant the second minister was, to demand a miracle to cure his headache when God had already provided aspirin. Surely it is arrogant for us to pray for miracles to relieve drought and poverty when God has already handed us the means to do so - markets. Again, however, we rarely hear moral criticism of those who refuse the miracle of the market and insist that God (or someone) perform the far greater miracle of making economic planning work.

We should hear more of such moral criticism.

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  1. Ethics and Markets
Posted by Andy Morriss on Saturday August 27, 2005 at 9:24am