Comment 94666

By j.servus (registered) | Posted November 11, 2013 at 23:32:54

Thanks for the excellent article. You are eloquent about the most important point: no price can be assigned to a clean conscience, fidelity to intelligence, to reason, to responsibility.

Your article also brings to light the underlying reason why it was a tragic mistake for the US Supreme Court to rule that corporations are 'persons' for the purpose of campaign contributions. Real persons have many different concerns and interests; corporations only have one: creating value for shareholders. (At least, this is the way business is currently taught.)

Without wishing to detract at all from the importance of the issues you raise, I would suggest a nuance at one point. I don't think 'arbitrary' is the right word for the values assigned by markets, inasmuch as 'arbitrary' connotes 'irrational', as in just picking a number at random. Prices do reflect some (inadequate) rational valuation. However, as you point out, the prices assigned do not reflect all the real costs, because (among other reasons) they do not (adequately) take into consideration externalities. Prices count costs, but not all the real costs. A regulatory framework like, for instance, a carbon trading scheme, is an attempt to assign a price to negative externalities that otherwise are not adequately accounted for simply by correlating supply and demand. In other words, this kind of regulation assigns an economic cost for what has a real cost. It is not clear to me how else these costs could be properly accounted for, since an individual vendor or consumer is not in a good position to understand, evaluate, and responsibly assign a dollar value to something like "air quality for everyone," in relation to some prospective purchase. (Of course there are always some who will by "carbon offsets," but the exceptions prove the rule: the externalities aren't accounted for in the price, and we know it.)

All of that said, I would not want to be misunderstood. My first point is that prices are a rational valuation system. My second point is (as you eloquently explain) that there are real costs that are not adequately accounted for in that system. My third and most important point is also your main point, as I take it: There are values to which no economic cost can possibly be assigned, and among them are the most important values in the world. As I tell my children, how much money is a clean conscience worth?

Comment edited by j.servus on 2013-11-11 23:38:58

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