Tuesday, October 15, 2013

Greed is Good

In the movie Wall Street, Gordon Gekko claims, “Greed is good. Greed works.  Greed clarifies…and captures the essence of the evolutionary spirit.”   Bernie Madoff, a real life greedster, once justified his behavior as simply leveraging client greed, as everyone on Wall Street did.  Economist Milton Friedman forcefully asserted that all societies are driven by greed and “that the world runs on individuals pursuing their separate interests,” essentially saying capitalism’s success depends on greed.

T
hese men describe a world in which greed is paramount, valued, and productive, a human nature imperative in which all that counts is the self.  They also portray life’s economic activities as a zero-sum game: “You win, I lose” or more preferably “I win, you lose.” Neo-Social Darwinists, they assert that greed is the backbone of survival of the fittest.  

In the eyes of most humankind, however, greed is far from good.  For many it is one of the seven deadly sins.  And while it is part of human nature, greed is only one of human nature's many facets.  Most of us have seen poignant instances of greed’s direct biological opposite, altruism, when a member of a group sacrifices his/her life for another group member. 
 
As for all three financial titans, they should have taken a biology class to learn that greed tends to be antithetical to evolutionary success.  Darwin’s theory of natural selection describes a gradual biological process in which a system of diverse life forms is mutually shaped, or evolves, over time through progressive adaptation to the demands of the constantly changing environment.  Evolution is a function of interacting adjustment in which all parts support each other for survival.  Metaphorically speaking, individuals who thrust their necks outside the system are likely to lose their heads. 

It seems that these men have projected their own narrow self-interest onto other individuals, and even whole societies, mesmerized (like Narcissus) by their own mirror reflection.  Their narrow beliefs have been reinforced by surrounding themselves with like-minded masters of the universe who also pursue selfish goals.  And, most likely, their skills are somewhat limited, better suited to selfish manipulation than to achieving productive outcomes.

It can be admirable to grow significant personal wealth, the goal of many capitalists. But if our society sanctions obtaining wealth through greedy behavior and values, then democracy and the promise of capitalism are at risk.  This is not a theoretical argument.  Today, after the debacle caused by greed in the financial markets, 1% of the U.S. population owns more wealth than the bottom 90% (or 99%), many of whom are middle-class, long-term jobless, and homeless.  Small businesses are strangling while big banks report record profits.  Government policy making is dominated by Wall Street cronies who can’t see beyond their conventional wisdom.

Can you have equal rights without free and fair elections that haven’t been bought?  Can you have capitalism in a monopolistic financial marketplace that limits access by entrepreneurs to start-up and growth funding?  No and no!  Highly concentrated wealth held by self-interested people hurts the U.S. economy and its social fabric. Indeed, the dictates of systems theory suggest that greed isn’t even good for the greedy in the long run!  

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