O.J. Simpson and Virtue in the Marketplace (Part 1 of 2)

Yesterday we learned that Rupert Murdoch's media empire has scrapped the O.J. Simpson TV program and upcoming book. The outcry was so strong that several Fox affiliates refused to air the program. No broadcast, no advertisers. No advertisers, no money. Fox made a business decision. There are some very powerful lessons here.

First, the free-market system allows businesses to compete to be the best at giving customers what they want. That arrangement tends to provide customers with what they want at the best quality for the best price. Yes, there are anomalies, externalities, and imperfections that must be dealt with, but painting with a broad brush, economic history has shown this to be true.

Second, virtue, or the lack thereof, shapes the wants and demands of people in the marketplace. This O.J. episode was about a business offering a product that was out of sync with the demands of the marketplace. In fact, it ran the risk of driving off customers buying "other products" the business supplies. This exercise of virtuous consumer behavior signaled to the supplier that they had made a bad choice. Morally destructive behavior was blocked.

Third, we hope businesses will exercise virtue in their decisions about what goods and services they bring to the market. They don't always. We don't live in a utopia. Some businesses simply make the occasional poor judgment call, while others are driven by greed. A good case can be made that Fox's business decision was based on pure greed. The beauty is that the greedy people at Fox, if they want to make money, are being compelled to behave more virtuously and offer products that align with the consumers' virtue. In this case, the market worked.

Fourth, all this should highlight the importance of the consumers' virtue! The free-market system is the most efficient and effective system for integrating and amplifying its participants' economic virtue and vice. To the degree you try to control vice from outside the market, you also shut down the amplification of virtue. Let me be clear. There is a need for controls from outside the market to restrain some activities. The point is to realize that the cost of reduced virtue amplification accompanies the benefit of any controlled vice. I am exercising virtue and reinforcing virtuous thinking for any action I choose not to engage in or avoid based on moral conviction. I am merely avoiding penalties for any action I choose to engage in or avoid because of legal constraints.

Many people routinely conflate materialistic individualism (a set of virtues/vices) with free market capitalism (an economic system.) Try envisioning the operating system on your computer as the economic system and the virtues/vices as the instructions you give to the computer. Now imagine you use your computer to calculate how you can swindle your employer out of tons of money, steal copyrighted material from publishers and download all sorts of pornography. The computer will do a very efficient job of facilitating your instructions. But then you declare that your operating system is corrupt because it generated dishonesty, theft, and sexual exploitation. You call for a new, more just operating system that generates more just outcomes. Meanwhile, all the good your computer does when appropriate virtues are fed into it is minimized and discounted. We end up sacrificing an effective and useful operating system because we won't take responsibility for our actions.

The problem is not the operating system. It is the operators. They lack the virtue to give the appropriate instructions to the economic system and then turn around and blame the economic system for the outcome. So who is responsible for this lack of virtue in our Judeo-Christian society? Is it not the Church? Yet the Church seems to be divided into two camps. One camp endorses and champions free market capitalism while thoroughly engulfed in the individualistic materialism of the age. Another camp is disgusted with individualistic materialism but blames the economic system for creating it. One leads toward economic injustice, and the other toward economic ruin through inefficient economics. So what is the answer?

I think the Apostle Paul knew the answer and demonstrated it by applying Jesus' teaching in his day.

More tomorrow.