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Nothing is more moral than the market Under every alternative economic system there is an element of compulsion.

Under every alternative economic system there is an element of compulsion. The market is not an anthropomorphic entity that exists separately from the actors within it

That’s all well and good, my Leftie friends often tell me, but what about morality? Let’s accept, they say, that markets are efficient, that they raise living standards, that they encourage people to invent and exchange things. Let’s even allow, for the sake of argument, that they alleviate poverty. Surely – this line is always delivered with a hint of smugness – surely there is more to life than economics. What about friends and family and acts of kindness? What about visiting the sick or caring for the environment? What about being a good parent, husband or friend?

Well, at the risk of stating the obvious, no one is against any of those things. Trust me on this, socialist readers. I know some of you see conservatism as a kind of mental deficiency, an inability to appreciate the important things in life. But I spend much of my time hanging around with Right-wingers and they’re as keen as the next chap on behaving decently. If anything, they’re less likely than most people to elevate motive over behaviour: you’ll rarely meet a free-marketeer who thinks that you prove your humanity by demanding higher taxes rather than, say, working for a charity.

A lot of people misunderstand what the market is. They think of it as an anthropomorphic entity that exists separately from the actors within it. How often do we hear talk about “letting the market rip”, or “the morality of the market”, as though it were some numinous force outside society? In fact, the market is a set of rules: a matrix within which people can behave generously or selfishly, honestly or shabbily.

In several critical regards, though, capitalism is superior to rival models. Its transactions, because non-coercive, are intrinsically moral. Think of the last time you bought something – the last time, say, that you took a taxi. The chances are that the driver took you promptly and efficiently to the place you wanted, and that you paid him what he thought you would. Each of you, in other words, precisely satisfied the other’s expectations. Can the same always be said of your relations with your friends, or even your spouse?

In every alternative economic system there is an element of compulsion. You prosper, not by offering a service freely to people who want it, but by sucking up to those in power: commissars or kings or ayatollahs or whoever. Quite apart from their authoritarianism, such systems are inefficient. When prosperity depends on sycophancy, you get less prosperity.

Nothing has done more to raise living standards that capitalism. A benefits claimant in Britain today has a higher standard of living than an average wage-earner between the wars. Extreme global poverty – defined as living on less than a dollar a day at 1990 prices – has fallen by more than two thirds over the past 25 years, and the drop has been steepest in countries that have opened up to global markets, above all in Africa.

More wealth means more time for friends and family and acts of kindness. It means more opportunities to visit the sick (though the population will be healthier) and more opportunities to clean up the environment (though the environment will be cleaner). A country in the early stages of industrialisation can’t afford the level of ecological protection that a wealthy one can. You breathe cleaner air and drink cleaner water in New York than in Hanoi. And, best of all, not having to work seven days a week simply to feed your family, you have time to appreciate the good things in life with them. GDP growth is not a distraction from the good things in life; it is their guarantor.

At the same time, wealth is an enabler of – not a rival to – generous behaviour. It doesn’t, of itself, make people behave better; but it does result in more charitable foundations, a larger civic society.

Of course, if your chief concern is with intention rather than effect, none of this will matter to you. You might grudgingly admit that mobile telephones have done more to lift Africans out of poverty than decades of overseas aid. But you will still resent the fact that the phone operators are motivated by profit. You won’t be able to shake off the sense that the their “greed” somehow taints the whole endeavour.

Well, you’re wrong. Wrong, at any rate, from the point of view of Africans. If you’re the wealthy citizen of a wealthy country, you can afford to be patronising. You can spout all sorts of nonsense about how globalisation is uprooting traditional communities and sucking people from settled rural lifestyles into shantytowns and yada yada. After all, as Anthony Trollope put it, “poverty, to be picturesque, should be rural”.

You won’t really admit to yourself that the people concerned are free agents. You won’t care that they are leaving villages where there is no electricity, no running water, no medical care and no work. The fact that they move to what you call a slum will offend your aesthetic sense. The fact that they accept low wages from a Western company will outrage your moral sense. You therefore can’t bring yourself to allow that they are rational adults.

When people talk of a “decent society”, they don’t mean a society filled by decent individuals, but a society where duty has been collectivised, virtue nationalised. As the expectation of state action grows, it squeezes out personal responsibility.

I’ll always remember how MEPs reacted to the Indian Ocean tsunami a decade ago. Speaker after speaker rose to propose gazillions in aid. But when one old boy, a sweet-natured Italian Catholic, rose to suggest that we make a personal gesture by donating a single day’s attendance allowance, the warmth drained from the room. Those who had been promising vast sums on behalf of their constituents glowered sullenly at the poor fellow. His proposal was icily dismissed and the meeting moved on.

It can’t be repeated too often: when you give to good causes, you are making a moral choice. When the government takes an equivalent sum from you in taxation and spends it on your behalf, you are not. In fact, if you’re looking for a moral maxim, it’s hard to improve on John Wesley’s: “Gain all you can, save all you can, give all you can”.

Daniel Hannan is a Conservative Member of the European Parliament and blogs at www.hannan.co.uk.

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