Economic Rationality?

So-called economic rationality is a species of mere calculation, not any form of substantive Reason. Reason not only is concerned with meanings, but always potentially puts presumed meanings into question.

The basic principles of economic rationality are that all money is created equal, and that everything has its price. Money putatively becomes a universal calculator, potentially supplying algorithms for all practical questions. From the point of view of Reason, this may result in sheer insanity. Practically, it causes suffering, and potentially the destruction of life on our planet. (See also Freedom from False Freedom.)

Aristotle clearly considered a preoccupation with money and profit over substantive values to be unseemly and incompatible with virtue.

The problem with capitalism is precisely that in the aggregate, corporations and their agents follow economic rationality to the exclusion of other values. It is made worse by the fact that corporations have the legal rights of persons, without most of the corresponding responsibilities. U.S. law actually enshrines the idea that the first responsibility of corporate officers is financial, so that the law actually promotes disregard for negative human and environmental impacts. Economic determinism can certainly be pushed too far, but there is a big boulder of truth in it.

Social ills are in the main the result of the unfolding logic of situations, not the moral badness of people. The blind pursuit of economic rationality requires no conspiracy. Globally, we are faced with an illegitimate and dangerous but pervasive substitution of economic “rationality” for substantive rationality. (See also Rationality; Democracy and Social Justice.)