As we have often noted, economic decisions reflect moral choices. As the world economy slowly recovers from near-catastrophe, another potential disaster looms in the horizon: that of the United States government defaulting on its debt. While families understand that they cannot live beyond their means, governments worldwide seem oblivious to this fact; after all, they can just print money as needed.
Decisions that would lead to personal bankruptcy if made by an individual are often applauded when made by impersonal governments. It is this depersonalized attitude that allows people to justify cheating the system by evading taxes. These same people would never dream of shoplifting. The fact that the former is far worse—repentance may not be possible for those who steal from the public purse—does not enter the equation. The lack of direct personal contact dulls our moral senses.
It is this same depersonalization that is the root cause of many corporate immoral activities perpetrated both by and against the corporate entity. While this may explain the behaviour, it does not justify it, especially when we are talking about those who lead our nations. The notion that the way to solve potential default is to raise the debt ceiling would be laughable if it were not so serious.
Jewish law long ago proscribed living beyond one’s means and much rabbinic legislation was enacted to curb excessive spending. This is especially true in the area of fulfilling our religious obligations, where one may be easily carried away in a misplaced desire to better serve G-d.
The idea of saddling our children with the effect of our massive spending appetites is reflective of our societies’ desire for instant gratification in all its forms. Restraint, patience and modesty are foreign concepts for much of the world, where instant gratification rules. The Talmud heaps great praise on those who plant today knowing the fruit will only be available for future generations. Instead we eat today though the cupboard is bare, picking the fruit before it even ripens.
When our leaders do recognize the need for great restraint, even austerity, they almost always lack the political will to carry out what is needed. The notion of “involvement in communal manners faithfully”—i.e., being willing to risk losing the next election—is one few entertain.
It is this focus on today which explains how the fortunes of companies can rise and fall based on earnings over a three-month period. Companies that have been making millions and billions year after year can see billions wiped off their market value because earnings over a three-month period were one penny short of “expectations”. The horrendous business decisions made by executives concerned more about quarterly profits rather than the long-term health of the company are both sad and, truth be told, very often immoral.
The recent troubles at Research in Motion are, to a large degree, related to it being one or two—or even, heaven help them, three—quarters late in releasing their latest products. It may well be that the delay in launch could be catastrophic for this twenty billion dollar company. Such a fate says much about our society’s inability to think long term.