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Advocating moral relativism
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But this is precisely what is needed when capital, land, labor, or entrepreneurial risks and costs are increasing. How can we advocate regulations or controls which, although intended to help consumers, actually hurt them? Obviously, one cannot have a free lunch. Richard L. Pfister's view ("Housing: No Crisis") attempts to explain the housing situation more precisely. Using census data, he analyzes a number of issues and concludes that the housing situation must not be in such a deplorable condition overall since (1) construction has supplied housing to meet growing demands at market prices, (2) overcrowding has lessened as a result, (3) the quality of homes has improved, (4) since demand for new homes at higher prices remains strong, families appear to be willing to spend more for housing as a percentage of income than they have in the past, and (5) this demand remains strong despite regional differences in expectations, land use controls, and desirabilities of location. Pfister also conceptualizes the "housing problem" as an income distribution problem rather than as a case for subsidizing housing consumption. This is not a moot point. If poor income distribution is viewed as a social problem, let us move toward a more equitable distribution. Pfister writes, "We would more effectively alleviate this problem if we subsidized rents or rental housing rather than subsidize home ownership or owner occupied housing." Furthermore, Pfister suggests that most of the current subsidies accrue to middle and upper income groups from the tax benefits associated with home ownership. Therefore, people who need assistance receive little help, and those who would pay most under a redistribution scheme are currently receiving most of the benefit. The suggestion here is not that income distribution should take place. That is a question of social equity, at least to some of us. But if society deems it as just, this method seems to be preferred to the current arrangement advocated by the Marshails of this country. Housing is indeed a complex and important consideration in modern life. Inadequate housing is a nightmare for the consumer. Programs which attempt to alleviate housing problems must be evaluated according to their costs and benefits to society at large. The extent to which we fail to consider economic costs using efficient allocative principles (that is, microeconomic theory) is the extent to which we need economic analysis. Although all of us are concerned about "housing in the United States," thank heaven for housing economists.
ADVOCATING MORAL RELATIVISM To the Editor: William J. Byron, S.J., proposes in his article "The Meaning of Ethics in Business" [December 1977] that common sense, reason, and religion form the basis for the conviction that certain corporate actions are to be judged unethical. I suggest that they " m a y " form that basis. Scratch an American business person in operation, and I suspect you will find an act-utilitarian or moral relativist. Take the now-familiar cases of facilitating payments made to foreign government officials by over 200 U.S. corporations. If the reasons for these payments were examined, it is likely that the corporate officials who approved them judged that the long-term good consequences of such payments (financial salvation of the corporation, perhaps, with all that entails--preservation of thousands of jobs, income to stockholders, impact on the national economy) outweighed the bad consequences (cost of the payment to the corporation, a possible fine, bad publicity, the personal corruption of the bribed official). If the reckoning of those officials was correct, they could appeal to a moral theory that supports their actions as morally right--namely, actutilitarianism. It could even be argued in Byron's terms that such payments satisfy common sense and are reasonable. (Any adherent of act-utilitarianism will hold that it is a reasonable moral theory.) Facilitating payments could also be justified on the grounds of moral relativism: Was the payment regarded as immoral by the ordinary citizens of the country where it was made? If not, the payment could not be regarded as immoral. As eminent a business person as W. Michael Blumenthal, Secretary of the Treasury and former chief executive officer of the Bendix Corporation, seems to advocate moral relativism when he argues that business morality has not deteriorated; society has changed (New York Times, Op-Ed Page, January 9, 1977). The point of all this is not to provide a moral justification for bribery. It is, simply, to challenge the idea that Byron's proposed three sources for a basis of moral conviction will be evident to most business people. I suspect that a large-scale ethical conversion will have to take place first.
G. J. Williams 113 Evergreen Avenue New Providence, N.]. 07974
BUSINESS HORIZONS
But this is precisely what is needed when capital, land, labor, or entrepreneurial risks and costs are increasing. How can we advocate regulations or controls which, although intended to help consumers, actually hurt them? Obviously, one cannot have a free lunch. Richard L. Pfister's view ("Housing: No Crisis") attempts to explain the housing situation more precisely. Using census data, he analyzes a number of issues and concludes that the housing situation must not be in such a deplorable condition overall since (1) construction has supplied housing to meet growing demands at market prices, (2) overcrowding has lessened as a result, (3) the quality of homes has improved, (4) since demand for new homes at higher prices remains strong, families appear to be willing to spend more for housing as a percentage of income than they have in the past, and (5) this demand remains strong despite regional differences in expectations, land use controls, and desirabilities of location. Pfister also conceptualizes the "housing problem" as an income distribution problem rather than as a case for subsidizing housing consumption. This is not a moot point. If poor income distribution is viewed as a social problem, let us move toward a more equitable distribution. Pfister writes, "We would more effectively alleviate this problem if we subsidized rents or rental housing rather than subsidize home ownership or owner occupied housing." Furthermore, Pfister suggests that most of the current subsidies accrue to middle and upper income groups from the tax benefits associated with home ownership. Therefore, people who need assistance receive little help, and those who would pay most under a redistribution scheme are currently receiving most of the benefit. The suggestion here is not that income distribution should take place. That is a question of social equity, at least to some of us. But if society deems it as just, this method seems to be preferred to the current arrangement advocated by the Marshails of this country. Housing is indeed a complex and important consideration in modern life. Inadequate housing is a nightmare for the consumer. Programs which attempt to alleviate housing problems must be evaluated according to their costs and benefits to society at large. The extent to which we fail to consider economic costs using efficient allocative principles (that is, microeconomic theory) is the extent to which we need economic analysis. Although all of us are concerned about "housing in the United States," thank heaven for housing economists.
ADVOCATING MORAL RELATIVISM To the Editor: William J. Byron, S.J., proposes in his article "The Meaning of Ethics in Business" [December 1977] that common sense, reason, and religion form the basis for the conviction that certain corporate actions are to be judged unethical. I suggest that they " m a y " form that basis. Scratch an American business person in operation, and I suspect you will find an act-utilitarian or moral relativist. Take the now-familiar cases of facilitating payments made to foreign government officials by over 200 U.S. corporations. If the reasons for these payments were examined, it is likely that the corporate officials who approved them judged that the long-term good consequences of such payments (financial salvation of the corporation, perhaps, with all that entails--preservation of thousands of jobs, income to stockholders, impact on the national economy) outweighed the bad consequences (cost of the payment to the corporation, a possible fine, bad publicity, the personal corruption of the bribed official). If the reckoning of those officials was correct, they could appeal to a moral theory that supports their actions as morally right--namely, actutilitarianism. It could even be argued in Byron's terms that such payments satisfy common sense and are reasonable. (Any adherent of act-utilitarianism will hold that it is a reasonable moral theory.) Facilitating payments could also be justified on the grounds of moral relativism: Was the payment regarded as immoral by the ordinary citizens of the country where it was made? If not, the payment could not be regarded as immoral. As eminent a business person as W. Michael Blumenthal, Secretary of the Treasury and former chief executive officer of the Bendix Corporation, seems to advocate moral relativism when he argues that business morality has not deteriorated; society has changed (New York Times, Op-Ed Page, January 9, 1977). The point of all this is not to provide a moral justification for bribery. It is, simply, to challenge the idea that Byron's proposed three sources for a basis of moral conviction will be evident to most business people. I suspect that a large-scale ethical conversion will have to take place first.
G. J. Williams 113 Evergreen Avenue New Providence, N.]. 07974
BUSINESS HORIZONS