Thursday, March 01, 2012

The Golden Calf Explains How Economism Lead to the Divine Right of CEOs

Our fellow blogger (on Hooked: Ethics, Medicine and Pharma), family physician and bioethicist Dr Howard Brody, has written a book on economic ideology that helps explain some of the issues we frequently discuss.

Dr Brody's book, The Golden Calf, is about how the social science of economics has been taken over by an ideology he and others call "economism." 


Economism consists of these major ideas:
  • "'The economy' is a separate and distinct sphere of society."  This means that economic planning can be independent of consideration of the rest of society.
  • "Even if only a part of society, the economy is the primary part."  Thus economic planning, thinking, policies etc take precedence over other planning, thinking, policies, etc.
  • "People are, at core, economic beings.  The laws of the marketplace describe virtually asll of their behavior and the reasons for it.  People are beings of economic exchange, driven first to make money and then to spend on the goods obtainable in the marketplace."  So all other human thought, values, emotions, etc are less important.  The answer to the question, "what does love have to do with it?" is nothing.  Neither does honesty, morality, or ethics have to do with it.
  • "Economic calculation is the best way to understand, value, and manage human life.  It is appropriate that every aspect of our lives be thought of and analyzed in terms of economic calculations."  This essentially asserts that economists, economic thinking, and the marketplace should rule the world. 
  • "The economy, above all else, must be managed solely with an eye towards its own technical requirements - that is, what economists study.  There ought to be no interference from politicians, or policymakers, or moralists, or anyone else."  Thus, not only should greed be considered good, but greed ought to be enacted into law. 
Economism's Prescription for Health Care

Stated so baldly, economism may seem absurd.  However, it is easy to see its influence.  For example, Dr Brody explained how economism would state:
what sort of health system the U.S. ought to have. It would be one that is governed by the laws of the market, and that treats all aspects of health care as consumer goods. How much any person 'needs' health care would be determined by one thing only - what that person is willing to pay on the open market. Anything else would be denounced as illegitimate interference with the market by politicians, policymakers, and other do-gooders.

This, of course, corresponds very well with a lot that is said about health care by its current leaders. How often have we heard about the health care market, and how the only way to improve health care is market-based reforms? (Look here).  How often have we heard leaders of hospitals refer to their "industry?" How often have we heard of patients as consumers, and doctors as providers? The list can go on.

The problems are that economism does not provide good tools for prediction or management of the economy. Worse,
If we want to live in a society that reflects basic human values, including acceptable moral rules, economism is a very poor guide. Yet economism is blind to its own deficiencies. it claims to be able to tell us the definitive answer to any problem in any aspect of human life, and accuse us of being irrational if we disagree with its proposals. If a powerful elite takes over control of a society, wedded to economism as their belief system, then the results for that society could be disastrous.
The origins of economism provide an explanation for a phenomenon we have often seen in health care, the lack of accountability of health care leaders, which we sometimes have described as CEO exceptionalism. We have noted how health care leaders almost never seem to need to take responsibility for their organizations' misbehavior and its outcomes, (look here) and in fact can command ever increasing compensation, no matter how badly they or their organizations do.

The Religious Origins of Economism
To understand this explanation, first note that Dr Brody suggested that economism is not a science. It did not arise out of an effort to use logic and reason to explain evidence. Instead, it seems to have come from two strains of religious thought that got translated into economic terms.  Dr Brody suggest that while it may make sense to think of economism as an ideology, it functions more like a religion, so that viewing economics ruled by economism as a social science would be a very big mistake.

The first strain was the Protestant evangelism found in England in the 18th century. Evangelicals of that time
regarded poverty as part of a divine program. Evangelicals interpreted the mental anguish of poverty and debt, and the physical agony of hunger or cold, as natural spurs to prick the conscience of sinners. They believed that the suffering of the poor would provoke remorse, reflection, and ultimately the conversion that would change their fate [in the afterlife]. In other words, poor people were poor for a reason, and helping them out of poverty would endanger their mortal souls.
Thus, people who fail in the marketplace of life are sinners. Markets should not be regulated to prevent such failure, because doing so would prevent their still possible salvation.

On the other hand, the Puritanism of the 17th and 18th centuries, and its 19th century evolution in the US
was creeping up on the idea, not only that material wealth and worldly success was a good thing in the eyes of God, but that seeing oneself become successful and wealthy was the strongest possible sign of God's grace and one's status among the Elect.

Things then got more extreme.
The moderate idea that those who enjoy material wealth in the earthly life may have been especially favored by God seems gradually to have morphed into the extreme idea that God wishes us to bestow on the super-rich our adulation and unquestioning allegiance.

For example, Reverend Russell Cornwell's lecture called 'Acres of Diamonds' proved so popular after he first wrote it in 1870 that he was called upon to give it six thousand times over the next quarter century. He preached: 'I say you ought to get rich, and it is your duty to get rich.'

We have been conditioned to believe that wealth is an infallible sign of God's favor.

Here is the religion behind CEO exceptionalism, lack of CEO accountability, outrageous CEO compensation, the imperial CEO. CEOs can become extremely wealthy, and "wealth is an infallible sign of God's favor," generating the notion of the divine right of CEOs.


No wonder that we have yet to see any logic or evidence to support CEO exceptionalism. Instead, we have seen logical fallacies used to support lack of CEO accountability and immense CEO compensation. The wealth of our leaders cannot be addressed with logic and evidence if it is a sign of God's favor.

Thus, anyone whose religious beliefs are perfectly compatible with 18th century English evangelism and 17th through 19th century British and American Puritanism and its aftermath might be happy with the divine right of CEOs, and with economism in general.

However, Dr Brody makes the powerful point that economism functions like a religion, and at best is an ideology, not scientific paradigm. Anyone who is uncomfortable with the religious beliefs that underlie it ought to be very uncomfortable with its precepts, as should anyone who believes that economics or health care should be based on evidence and logic.

Specifically, in health care and in the larger economy, anyone who does not believe that rich CEOs are especially favored by God should question why they should be so rich, and why they should be so unaccountable.

Dr Brody has written a powerful and important book which goes a long way to explain the irrationality that has infected health care. People of all, or of no religious beliefs should pay attention.


Afraid said...

"Thus, anyone whose religious beliefs are perfectly compatible with 18th century English evangelism and 17th through 19th century British and American Puritanism and its aftermath might be happy with the divine right of CEOs, and with economism in general. "

Roy, I think you have gone much too far here. I dont know if you are a religious man or even if you profess a certain religious faith, however I think you have smeared all of those who might call themselves christian. At least I feel that way after reading your otherwise well thought out post.

Do you really think the religious are OK with the way healthcare or any other part of america is run by the 1%?

Roy M. Poses MD said...


Please read that sentence again.

I am no expert on the overall religious beliefs of the population, but I would bet that very few people have beliefs that are perfectly compatible with those teachings from the 17th through the 19th century.

My point was more that if most people looked for the underpinning of the current cult of the divine rights of CEOs, they would find neither logic and evidence, nor religious beliefs with which they are comfortable. Thus, they ought not to be comfortable with the divine right of CEOs.

I submit that the vast majority of people who uphold any of the major religions would not be comfortable with these underpinnings.

Howard Brody said...

Since Roy was so kind as to provide a superb summary of my book, let me add to the response to Afraid, which jumped onto the one area where Roy misspoke slightly in conveying the book's message. The book tries to make clear that today, no one in all likelihood holds religious beliefs that match 18th c American puritanism or 19th c British evangelicalism. But religious beliefs sometimes worm their way into the popular consciousness and culture independent of the religious systems that gave rise to them--as Max Weber put it, our everyday common sense contains the "ghosts of dead religions." I would hope as Afraid says that thoughtful Christians would be the first to condemn today's economism, which is at heart a crassly materialistic creed. Sadly some Christians today seem less than thoughtful and have been sold a version of economism piggy-backed upon social conservatism.

Afraid said...

"Sadly some Christians today seem less than thoughtful and have been sold a version of economism piggy-backed upon social conservatism." --

Howard, it may be unintentional, but there you go again. How about the statement "Sadly some Jews today seem less than thoughtful .... upon social liberalism." Now I would absolutely never say that, and I don't believe it, but can't you see how hurtful that is?

I do not see this as exclusively christian. Lots of people, many jewish and certainly rich arabs, buy into economism. I think the chinese have a government that institutionalizes economism, and they do it with social value excuses too. Social liberals and conservatives both suffer from it as well.

I think you need to be very careful here, and believe me, I'm not criticising you, but I am telling you how I feel when singled out as being part of a religion or belief set (conservative) that, by extension of economism, values money over people.

I could point out that a large percentage of bankers, doctors and healthcare CEOs are jewish or hindu, certainly overrepresented as it compares with % in the general population. I could construct a similarly flawed arguement that their cultural history is responsible.

I rather expressedly reject that notion and I see greed and lapses in ethics as beyond creed, or perhaps its own creed, evil. It is the personal responsibility for those who hurt people to stop the acts. Christian jew, muslim, hindu, black, women, chinese, or aliens from outer space .... whomever.

Howard Brody said...

Afraid, by now you'd think I'd have the smarts to ignore any further messages and keep my mouth shut as whatever I say seems to make it worse, but I'll try again nonetheless. This falls under the category of "read the book and see for yourself." I truly believe that if you were to read the book you'd see that there's nothing anti-Christian in it. One point that I try to make in the book is that I understand basic Christian teaching to be very sympathetic to the plight of the poor, and I have spoken with Christian clergy and they confirm that's a basic message of the New Testament. However, today there are political forces in the U.S. that seem completely opposed to any social programs that might help the poor, and in general believe that the poor should be punished because they brought it all on themselves. That to me seems an un-Christian message. But SOME (by no means all) Christians seem to have allied themselves firmly with those political forces. I could believe one of two things about that particular group of Christians--either that they have been misled by a powerful ideology (economism), or else that they are mean-spirited, and I prefer to believe the former. As you say, there are also Jews, Hindus, etc who believe in that misguided (to me) economism ideology and for them I have the same sense that they have probably been misled. But it seems more striking in the case of Christians simply because I believe (perhaps erroneously) that the New Testament message about one's duty to help the poor is so clear. I hope this helps explain what I am trying to say, and again, if this seems that I am dealing in stereotypes or tarring whole religions with the same brush, then I have conveyed my meaning again very poorly. Thanks for listening, Howard

Afraid said...

Thanks for explaining Howard, I do appreciate it, and no I don't think you are purposfully tarring people. Unconsciously perhaps.

After all there are great traditions in other religions to help the poor that are contravened by the actions of some who espouse those same beliefs. So to say that there is any more or less contradiction in christianity again, is, I think, skewed.

In the bigger scheme of things, I do see that your point is in support (or against) a certain political positioning.

What I am saying is that even though I am a fiscal conservative who believes that there is some truth in an entitlement tends to attract more people who want it, I still support 99.99% of what is written on HCR.

Overall them, I am asking not to demonize even people who believe in conservative positions since we all have a problem with a greedy CEO.

Joining together rather than separating will help; I don't see either political party as serious about solving the problems we discuss here. We are much stronger together than apart.