The Ethics of Capitalism
Presenters: Steve Asheroff and Charlie Sinatra Moderator: Dr. John Miller
Steve Asheroff grew up on Long Island, and graduated from Boston University. He went on to graduate school at the Fox School of Business and Wharton School of Finance. Steve worked in commercial banking at Provident National Bank, Philadelphia, PA., United Virginia Bank in Richmond, and, finally, at National Westminster Bank USA in New York City. He was responsible for all asset based lending, including real estate finance, and was one of a group of five brought in by NatWest to sell their American operation to Fleet, and then ultimately to B of A. He retired to HHI in 1996.
Charlie Sinatra was born and raised in southwestern New York State. He received his undergraduate degree at Norwich Military College, then received his MD from Georgetown Medical School. He served for two years as a US Army medical doctor, then spent the next thirty five years doing General Practice in Jamestown, NY. Charlie retired to HHI seventeen years ago.
Capitalism is defined as an economic and political system in which a country's trade and industry are controlled by private owners for profit, rather than by the state.
Charlie began the discussion and stated the following:
1. It would be a fool’s errand to argue that Capitalism is all bad. The millions upon millions and most likely billions, of men, women, children and pets that have benefitted from the fruits of Capitalism is an undeniable truth. But since it is not based on a fact, there must be another side of the debate that I would like to discuss.
2. Since its inception five hundred years ago Capitalism has had its supporters as well as its detractors. It is only appropriate, considering the national debate on inequality now on the world stage, that this subject has been selected by the HHI Ethics Board.
Steve commented in the following manner:
1. Economic systems, whether Capitalistic or other, are neither ethical nor unethical. Individuals who practice within a particular framework determine whether their brand of the system will be ethical. Certainly the owner of a factory that knowingly contains unsafe conditions causing injury and/or death is not acting in an ethical manner. This is actually not the system, but rather the individual.
2. Many "Capitalists" are entirely too short-sighted. Capitalism thrives on a vibrant, growing consumer/middle class. Holding workers down through minimal wages, borderline working conditions, etc., does not promote the end result that true Capitalists want, i.e. an increase in demand for their goods and services.
Audience Participation (**):
** How does Capitalism influence inequality?
Steve noted that we all have unequal genes. Some are smarter than others, even on a level playing field.
** We need to correct the “Gatsby Curve”. We are ranked 8th amongst the major nations in social mobility. CEOs salaries are gross. (ratio of 1/20 to workers was once acceptable. Now the ratio i at 1/500).
Steve commented that “is it ethical to hold some deserving person back and give the opportunity to others who have less merit?”
** Capitalism is a force—Is it Amoral? Is government need as a glance. Is either inherently good?
Steve remarked, that it depends on the people involved.
Charlie said it is not the individual player, but rather the corporations, who now want to be treated as people. They want it both ways. Immorality reminds him of Greed.
Steve agrees on the corporate contribution to politics, but adds that we all have stocks in some form, and await company earnings. Apple takes no shortcuts in quality and society benefits.
** Capitalism has been around for 150 years and we have made great progress. Reading Marx’s Das Kapital is frightening.
Steve agreed that we must have change. Nothing is static. Henry Ford understood the need for customers and helped to ignite a vibrant middle class.
** Morris was similar to Ford in England.
** Capitalism leads to pollution. More rules need to be imposed to control such.
Steve added that China was not initially capitalistic and recognized the need for certain regulations.
** Why do we need socialism?
Charlie added that we all use socialism. Check your wallets for Social Security, Medicare and other assists. Consider communism and capitalism in China. It seems to be melding somewhat. Look at other major countries.
** Most of us here started with more opportunity. We all need some social benefits to equalize.. Our government needs more funds to continue these programs. We must search and employ an efficient transfer of resources from many to few.
Steve mentioned that we shouldn’t allow this, however, to damage society as a whole. It behooves our society to help the brightest to progress as far as they are able. He added that for the government to be the one to do this is unethical and not for the greater good of a society.
The discussion had to be curtailed at 4:40 PM by John Miller, because of running overtime.
Thanks to Charlie and Steve for their research, outstanding presentations, and comments on this major issue. Thanks also to John Miller for moderating this vibrant discussion and thanks to our audience for their active participation.
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