In preparation for Classical & Marxian Political Economy and for her visit this Spring, I've been re-reading Deirdre McCloskey's The Bourgeois Virtues: Ethics for an Age of Commerce. In this, the first of a planned five-volume magnum opus, McCloskey argues for the instrumental value of bourgeois capitalism not merely as a vehicle for the production of goods and services but as a vehicle for human flourishing more broadly defined. I read a draft of it in preparation for her visit to Wash U the week before my dissertation proposal, and now after 2.5 years as a faculty member, I’m appreciating it in a whole new light. McCloskey writes with penetrating insight, unmatched verve, and a master’s command of price theory. A few choice passages from pp. 1-55 are below the fold.

On the moralizing and ennobling effects of capitalism:

“[Members of the clerisy] quite understandably want to honor their poor ancestors in the Italy of old or their poor cousins in India now, and feel impelled to claim with anguish as they sip their caramel macchiato grande that their prosperity comes at a terrible ethical cost.” p. 23

“Here are you and I, learnedly discussing the merits and demerits of capitalism.” p. 25

“I say that idealizations or satires aside, a soul choosing from behind a prenatal veil would opt for bourgeois life now over Tahitian agriculture in 1896. Their mothers and fathers surely would, for their children. Billions have voted this way with their feet.” p. 25

On Classical Liberalism and “Selfishness” (channeling her inner Ayn Rand):

“The tempting shortcut of taxing the rich has not worked, for two reasons. First, I repeat, taxation is taking, and as the philosopher Edward Feser puts it, ‘Respecting another’s self-ownership…[reflects] one’s recognition that another person does not exist for you…The socialist or liberal egalitarian…rather than the Nozickian libertarian…is…more plausibly accused of “selfishness.”’ No left egalitarian has explained how such takings square with Kant’s second formulation of the categorical imperative: ‘So act as to use humanity, both in your own person and in the person of every other, always at the same time as an end, never simply as a means.’ Taxing Peter to pay Paul is using Peter for Paul. it is corrupting. Modern governments have been encouraged to think that any abuse of Peter is just fine, that Peter is a slave available for any duty that the ruler has in mind. A little like nonmodern governments.” p. 44

Finally, a Jeremiad on Statism, Intervention, and its Consequences:

“In the nineteenth and twentieth centuries ordinary Europeans were hurt, not helped, by their colonial empires. Economic growth in Russia was slowed, not accelerated, by Soviet central planning. American Progressive regulation and its European anticipations protected monopolies of transportation like railways and protected monopolies of retailing like High Street shops and protected monopolies of professional services like medicine, not the consumers. ‘Protective’ legislation in the United States and ‘family-wage’ legislation in Europe subordinated women. State-armed psychiatrists in America jailed homosexuals, and in Russia jailed democrats. Some of the New Deal prevented rather than aided America’s recovery from the Great Depression.

“Unions raised wages for plumbers and autoworkers but reduced wages for the nonunionized. minimum wages protected union jobs but made the poor unemployable. Building codes sometimes kept buildings from falling or burning down but always gave steady work to well-connected carpenters and electricians. Zoning and planning permission has protected rich landlords rather than helping the poor. Rent control makes the poor and the mentally ill unhousable, because no one will build inexpensive housing when it is forced by law to be expensive. The sane and the already-rich get the rent-controlled apartments and the fancy townhouses in once-poor neighborhoods.

“Regulation of electricity hurt householders by raising electricity costs, as did the ban on nuclear power. The Securities Exchange Commission did not help small investors. Federal deposit insurance made banks careless with depositors’ money. The conservation movement in the Western United States enriched ranchers who used federal lands for grazing and enriched lumber companies who used federal lands for clear-cutting. American and other attempts at prohibiting trade in recreational drugs resulted in higher drug consumption and the destruction of inner cities. Governments have outlawed needle exchanges and condom advertising, and denied the existence of AIDS.” p. 51

Woe to thee, O Israel, indeed. Here's a Cato Policy Report summary of the argument. And an EconTalk Podcast.

Cross-Posted at The Beacon.