Podcast Summary

LSE: Public Lectures and Events

Episode: "Capitalism: Can It Ever Be Moral?"

Date: October 4, 2010

Host: LSE Film and Audio Team

Main Theme and Purpose

This episode, the inaugural lecture of the Ralph Miliband series at LSE, tackles the provocative question: Can capitalism ever be moral? The discussion is sparked by the recent publication of Crisis and Recovery: Ethics, Economics and Justice, edited by Larry Elliott and Rowan Williams. Against the backdrop of the global financial crisis, a panel of economists, politicians, and philosophers debates whether capitalism can, or should, be reformed to better adhere to ethical standards. The event features:

• Larry Elliott: Economics Editor of The Guardian
• Jon Cruddas (introduced as "John Crullis" in the transcript): Labour MP and political philosopher
• Professor Chandran Kukathas: Professor of Political Theory at LSE

After brief opening remarks positioning the debate following the global financial crisis, each speaker presents their view, followed by incisive cross-discussion and audience Q&A.

Key Discussion Points and Insights

1. Background and Framing (00:00–04:51)

• The Ralph Miliband series aims to embody Ralph's spirit of "critical, open dialogue."
• The evening focuses on whether capitalism can/should be molded to fit defensible moral standards, and unpacks "agency" (how individuals should behave) vs "structure" (the ethics of the system as a whole).

2. Larry Elliott: The Case for Reform, Crisis, and Ethics (04:51–27:24)

• Context of the Book (05:30): Conceived amidst the 2009 financial crisis, gathering diverse voices—bankers, philosophers, clergy—across the spectrum.
• Critique of Market Fundamentalism (07:10–10:00):
  • Market fundamentalism has dominated economics—and dissent was marginalized.
  • Historic crises (Mexico, Asia, Russia, Argentina) signaled "something fundamental had gone wrong," eventually striking the core.
  • Quote: "If you look at what happened…crises were happening with too much regularity…The real economy seemed to be working in a completely different way from the global economy." (09:55)
• Morals and Restraint:
  • Capitalism "worked best when regulated, when there were some moral constraints put on it." (13:20)
  • The golden age: 1950–early 1970s—"growth rates were higher...and the spoils of growth were shared more evenly."
• Broader Concepts of Progress:
  • Material progress alone is insufficient—must also address resource depletion, inequality, and lack of cultural resonance.
  • Quote: "Can you really have proper progress when the spoils are so unevenly shared?...In a democracy you have to inject some form of equity or it won't survive for long." (15:35)
• Global Dysfunction and Political Failure:
  • The crisis is not just financial but moral and environmental. Persistent global imbalances remain unresolved.
  • Quote: "If we can't even deal with problems that seem relatively simple, how are we going to deal with these much more intractable problems, such as...climate change?" (18:45)
• Historical Parallels and Reform:
  • Elliott likens globalization today to the medieval church: a rigid orthodoxy, rampant corruption, cries out for 'Reformation.'
  • Post-crisis, hopes for social democratic revival have faded. Instead, there's a resurgence of conservative policy, "blunting appetite for reform."
  • Prediction: The world may face a "long period of adjustment"—"The Great Reckoning." (26:55)

3. Jon Cruddas: Social Democracy, Virtue, and New Directions (27:24–39:37)

• Crisis of Social Democracy:
  • The economic crisis became a political crisis for the Left.
  • New Labour’s journey: from communitarian ideals to "a dystopian notion of winner takes all." (33:40)
• Essence of Morality in Religion and Community:
  • Cites the "Golden Rule": "Do not do unto others as you would not have them do unto you. That is the Torah. The rest is commentary." (28:30)
  • Argues for a social democracy grounded in obligation, duty, and solidarity—countering the atomistic, self-interested individual lasting from neoclassical economics (31:30).
• Reclaiming Virtue Politics:
  • The Left (and society at large) must move beyond "acquisition" and toward virtue—a politics of hope, not despair (38:10).
  • Warns of the risks of populist, reactionary movements in times of social rupture.

4. Chandran Kukathas: The Limits of Reform, Capitalism’s Nature (39:37–53:02)

• Skepticism towards the Panel’s Critique:
  • Finds the critique of capitalism "too much of a caricature" and not fully appreciative of diversity within capitalism.
  • Provocative Analogy: The question "Can capitalism ever be moral?" is akin to "Have you stopped beating your wife?"—presupposes guilt (40:10).
• What is Capitalism? (41:30)
  • Defined by trade, universal possibility to participate in trade, technology (physical and organizational), and production without predetermined ends.
  • Observes capitalism is both brutal (changes destroy ways of life) and indifferent to culture, yet adaptable.
  • Quote: "Capitalism feels no regret or remorse. It's like the Terminator. It's pitiless." (44:56)
• On Morality and Reform:
  • Capitalism’s reciprocity can be called moral, but constant attempts to 'change the rules' for self-interest ensure immorality, too.
  • Serious reform is unlikely: "Capitalism by its very nature creates people who want to reform it only in their own interest." (50:30)
  • Cites Juvenal: "Who will guard the guardians?"—or, here, "Who will reform the reformers?"

5. Panel Responses and Exchanges (53:02–60:27)

• Jon Cruddas emphasizes pragmatic reforms for equality and democracy, not the abolition of capitalism (53:32).
• Larry Elliott clarifies:
  • There are "many varieties of capitalism" (e.g., Swedish, Chinese, Italian), but the critique is of the Anglo-Saxon model which created a "monoculture" and "ate its own babies." (55:42)
  • The theoretical model (efficient markets, deregulation) failed in crisis—exposing the limits of faith in pure markets (56:13).
• Chandran Kukathas highlights that if the critique targets only one model, it risks being a critique not of capitalism but of the state's role, and the state-market interactions need careful disentangling (58:26).
• On agency and structure: Debate about whether the crisis reflects failure of individuals, markets, or both.

Audience Q&A and Key Moments

Notable Themes and Questions

• Morality & the Social vs. Capitalism: Is capitalism blamed for all 'bad,' while the 'social' is idealized? (61:24)
• Competitive Nature: Is competition in capitalism just human nature? What is true morality? (62:17)
• Unearned Income & Monopoly Power: Should unearned income (rents, banking profits) be considered immoral and abolished? (62:48–63:52)
• Planetary Boundaries: Must our economics heed Earth's limits and "laws of nature"? (63:56)
• Religion vs. Secular Morality: Must morality in capitalism be rooted in religion? (64:51)
• Scandinavian Capitalism: Is the Scandinavian model ‘more moral’ than Anglo-Saxon capitalism? (73:00)
• Central Banks & State’s Role: Did state-run central banks, through low rates, cause the crisis? (74:06)
• Economics Education: Should economics training include more moral philosophy? (74:43)
• Regulation: With more regulation than ever, can lack of regulation truly be blamed? Or is it the wrong kind? (75:30–77:05)
• Multipolar World and Morality: How do shifting global power and differing value systems complicate the search for 'morality' in capitalism? (78:09)

Notable Quotes

• Kukathas (on capitalism’s morality):
  "If one thinks of capitalism as a system built on exchange, norms of reciprocity, then capitalism is by its nature moral... But if we recognize that capitalism will always provoke people to try to change the rules of the game to suit themselves... capitalism will always bring with it immorality." (48:25)
• Cruddas (on virtue politics and hope):
  "Raymond Williams once said, 'to be truly radical is to make hope possible rather than despair convincing.' And that dystopian model... is at an end and has to be reforged into something social democratic." (38:10)
• Elliott (on regulation and global power):
  "London was actively marketed as a light touch, low regulatory offshore centre... Do we need to protect ourselves from capitalism? Yes, we do." (79:23, 82:46)
• Cruddas (on economics as a discipline):
  "...the isolation of economics from its philosophical roots means we reach this logical conclusion—a crisis of overregulation—because of the purity, the abstraction involved..." (82:46)
• Kukathas (on variety and limitations of models):
  "Not all systems work in the same places... You can't transplant Singaporean capitalism into Finland... Both seem to work pretty well." (85:33)

Timestamps for Important Segments

• Opening Remarks / Framing – 00:00–04:51
• Larry Elliott’s Presentation – 04:51–27:24
• Jon Cruddas' Response / Social Democratic Critique – 27:24–39:37
• Chandran Kukathas' Critique & Perspective – 39:37–53:02
• Panel Response & Debate – 53:02–60:27
• Audience Q&A – 61:24–88:49
• Notable Audience Issues:
  • Morality and the social vs. capitalism (61:24)
  • Unearned incomes/monopoly power (62:48)
  • Planetary boundaries & environmental limits (63:56)
  • Scandinavian vs. Anglo-Saxon models (73:00)
  • Economics education reform (74:43)
  • Regulation: kind vs. quantity (75:30)
  • Multipolarity and relativism in morality (78:09)

Memorable Moments

• Parallel to the medieval church: Elliott’s allegory between today’s financial orthodoxy and the Catholic church on the eve of Reformation was a highlight—injecting wit and historical depth (20:41).
• Virtue and Solidarity: Cruddas’ invocation of the Golden Rule and a shift from "winner-takes-all" to a politics of duty prompted both philosophical and practical reflections (28:30–36:00).
• Kukathas' Capitalism Analogy: Comparing capitalism to the "Terminator" for its pitilessness (44:56)—a moment of both humor and gravity.
• The role of economics education: Calls for moral philosophy to be normalized in economics curricula resonated with both panel and audience (74:59–75:17).

Conclusion and Tone

The debate was rich, spirited, and reflective. All speakers agreed that capitalism is complex, multifaceted, and deeply entangled with broader social, political, and ethical forces. There was general consensus that the Anglo-Saxon model that dominated the late 20th century had become unstable and perhaps too influential. Elliott and Cruddas argued for practical reforms and a reinvigoration of social democracy, while Kukathas cautioned against oversimplification, emphasizing capitalism's inherent variety and the limits of intentional moral engineering.

In sum:

• Can capitalism be moral? Opinions diverged: some see the need (and possibility) of moral reform, others see capitalism's tension with morality as intrinsic, permanent, and unavoidable.
• Must it be moral? The speakers agreed only that society and politics must grapple with these questions—earnestly, honestly, and without easy answers.

The event ended with a call for continued debate, humility, and, above all, the need for both critique and practical engagement.