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March 2023
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On Morality, Economics and the Law
Filed under: Politics and Economics
Posted by: site admin @ 7:21 am

“Morality, it could be argued, represents the way that people would like the world to work - whereas economics represents how it actually does work”1

It could also be argued that “Law” is our attempt to make the two coincide.

The law is an incentive system we create to encourage certain behaviors and discourage others. In particular, the law is an “unnatural” system, in that it is created specifically to counter some tendency in human behavior. We don’t have laws telling us to engage in sex - we don’t need them. Humans, left to their own devices, will tend to engage in sexual activity. We do, however, have many laws telling us under what circumstances to NOT have sex (In public, with a sibling, with a child, etc.) because some percentage of the population will otherwise engage in these behaviors.

Further, we don’t just create law for no reason. Because law is unnatural, it carries a cost to enforce. It either requires internal discipline/ effort when individuals choose to voluntarily comply OR it imposes a cost on society when some part of society uses external pressure to make recalcitrant individuals comply. The reasons behind our choice of what laws to create boil down to our moral philosophy (and a certain amount of pragmatism about enforcement mechanisms and costs).

By creating law, we are saying something about our society and it’s common values. We’re saying that at some point it time, we held a set of values that we deemed important enough to put some work into. As opposed to the “philosophies” that can be debated ad infinitum around a dinner table, we have said by the creation of a law that we hold something so precious as to be willing to pay a price for it - both in the time to fight for the public statement of that belief and the ongoing cost of engendering conformance to that belief by the rest of society.

We should be careful, therefore, as to what we make law - because of what it says about us.

1. “Freakonomics : A Rogue Economist Explores the Hidden Side of Everything”, Levitt, Steven D. and Dubner, Stephen J, 2005, HarperCollins, New York., p.13.

One Response to “On Morality, Economics and the Law”

  1. Brad Causey Says:
    Your thoughts are quite correct and accurate. I would like to add a few observations. Morality is obviously a personal choice. One persons morality is different from another. Looking at the historical evolution of laws, a pattern can be seen. There was a time, where law was simply what one could get away with. (Some corporate chieftains apparently still think this is valid) As society became more complex, written laws appeared for the first time. The Hammerabi code, for instance. Written in stone, and posted in a public place. The easiest example from bibical history is the ten commandments. The ten commandments are very simple and essentially morality based. All basic laws are based upon morality. Laws against murder, robbery, theft, respect of authority, etc. are all based on a basic moral standard. In recent years our lawmaking has changed from basic assumptions and civil behavior— to detail for no real purpose other than to say we are doing something. The easiest way to tell whether the law is valid is to look at the exemptions. Congress frequently exempts itself, or specific special interests from laws it passes. Easy examples being the minimum wage, corporate accounting and gun control. A second bad section of law are those designed to benefit one element of society (or specific individuals) at the expense of another. Tax law since the advent of the income tax, is one bad thing on top of another. The tax code now exceeds 60,000 pages. It long ago became a way to control behavior instead of simply raising revenue. (This is also the main reason why the founding fathers specially excluded it in the original document) One could write many books on bad laws of the 20th century alone. Most of this busy body behavior started after the civil war. Although abolishing slavery was a good thing, the total destruction of states rights was not worth the cost. Since that time the Federal Government has taken it upon themselves to regulate virtually anything without thought as to jurisdiction, the constitution or common sense. As a result we have ceased to be a free society. Our laws today have more in common with Nazi Germany and the Soviet Union than they do with the intention of the Founding Fathers. There is much more to say, but that is all I have time for this morning.

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