ETHICS EXAM 2

How does Friedman provide a realistic defense of capitalism?

How does Friedman provide a realistic defense of capitalism?

He defends capitalism by showing how free markets turn self-interest ("greed") into benefits for society through free choices, not force. (its the best we got).

How does Friedman provide a moral defense of capitalism?

emphasizing individual freedom and voluntary exchange. He argues that capitalism respects personal choice, allowing people to pursue their own goals without coercion

How does Friedman respond to the claim that capitalism doesn’t reward virtue?

capitalism doesn’t reward virtue by arguing that capitalism rewards efficiency, not virtue. He explains that in a free market, individuals are rewarded for providing goods and services that others want, regardless of their personal virtues.

What are the 5 features that constitute capitalism?

1. Strong legal protections for private property
2. Widespread dispersion of private property across
the population
3. Extensive international trade
4. Consumer sovereignty
5. Diversity of employment contracts

How is capitalism distinct from feudalism and socialism (the alternatives to capitalism)?

Capitalism is based on free markets and individual choice, while feudalism relies on a rigid class system and socialism emphasizes state control and equality.

How is capitalism similar from feudalism and socialism

All three systems involve economic organization, though capitalism promotes personal freedom and private property, unlike feudalism and socialism.

• Allow for private ownership, status equality, and centralize planning

What is the challenge for those who are against capitalism?

Critics must explain how to achieve economic fairness without limiting freedom and choice.

• Show that these bad things like inequality are because of capitalism, but some say inequality always existed!

what is the challenge for defenders of capitalism
today?

Defenders must address issues like inequality and environmental harm while maintaining capitalism's benefits of freedom and efficiency.

• Capitalism is freedom, choice, and mobility and how it makes the world a better place

What is universal opulence? And how does global capitalism lead to it?

Universal Opulence is the widespread access to wealth and improved living standards.

how does global capitalism lead to universal opulence

by promoting economic growth, reducing poverty, and increasing life expectancy, allowing more people to focus on happiness and personal choice instead of mere survival.

What does the global wealth pyramid reveal?

52.5% of individuals make under 10,000USD while those who make 1 mill or more make up 55.4 million (1.1%) of individuals.

• extreme poverty is eradicated, but half of the world lives in a new poverty.

summarize Sandel’s argument!

we need to rethink how we treat each other as citizens, especially in times of crisis. He argues that meritocracy (rewarding only the talented) creates divisions and hurts social unity. He believes we should value and fairly pay essential workers and change the economy to ensure everyone is treated fairly and works together.

How, specifically, is meritocracy morally corrosive?

Meritocracy is morally harmful because it makes people believe their success is solely due to their own efforts, leading them to ignore the help they received from others. This can cause them to look down on those who struggle and weaken the sense of community.

what is the problem with "credentialism”?

Credentialism values degrees and formal qualifications over actual skills and abilities, which can exclude talented people who may not have formal education.

Based on Sandel’s argument, how should capitalism (and “meritocracy”) change?

focus more on recognizing the value of all types of work, not just high-paying or credentialed jobs. We need to reward essential workers fairly, reduce inequality, and create a more inclusive economy that values contributions to the common good rather than just individual success.

What is fast fashion? How does it relate to globalization? And what do the issues reveal about global capitalism?

Fast fashion produces cheap, trendy clothes quickly, relying on global supply chains. It exposes issues in global capitalism, like labor exploitation, environmental harm, and unsustainable consumption, driven by profit over ethical concerns.

What is the iron law of responsibility?

businesses must use their power responsibly and if not used, they will loose that power.

What is corporate social responsibility?

CSR is when businesses consider social, environmental, and economic factors in their actions

What is the triple bottom line?

• People: Fair treatment of workers and community involvement

• Planet: Protecting the environment

• Profit: Earning money while balancing the other two.

Friedman’s View:

the primary social responsibility of business is to maximize profits for shareholders within the bounds of the law. He believes businesses should not engage in social or environmental causes, as it diverts focus from profit-making (CEO is an Agent that works on behalf of the principles of a company, maximzing returns not social goods)

Why is Friedmans view good? Collective ends cant be found without collective means…

The basic idea for classical economics is that each person pursuing what they wants gives society what it wants. Collective means securing collective ends, market deciding what it wants and receiving it in the end.

• Socialist decides interest for sum works in the whole, but that’s not how it works because everyone is self interested. The free market is power to the people

Mackey’s View:

businesses have a broad social responsibility beyond profit, including addressing social and environmental issues. He argues that businesses should create value for all stakeholders.

Its about stakeholders over shareholders! To take care of all constituents (stakeholders) the company is responsible for… consumers, employees, suppliers, the environment, etc.

Are they ultimately saying the same thing? If not, what differentiates their positions?

Friedman focuses on profits as the sole responsibility, while Mackey promotes balancing profit with addressing societal needs, emphasizing the importance of creating value for various stakeholders.

What does Friedman mean when he says that collective ends cannot be attained without collective means? And how
does this conclusion relate to his argument?

Friedman’s statement means that social goals (like solving poverty) require government intervention (collective means), not businesses. Businesses cannot take on societal roles because they are meant to focus on profit-making.

What is sustainability?

meeting present needs without compromising the ability of future generations to meet their own needs, balancing economic, social, and environmental factors.

Corporate Sustainability

companies integrating environmental, social, and economic concerns into their operations to ensure long-term success and reduce negative impacts on the planet and society.

what do Patagonia and Dr. Bronner’s show us about corporate social responsibility and corporate sustainability?

Both companies show commitment to sustainability by prioritizing ethical sourcing, reducing environmental impact, and supporting social causes. They emphasize the importance of aligning business success with positive environmental and social contributions.

What are some of the takeaways from the yellow-blue game we played in class?

The game demonstrates how individuals acting in their own self-interest can lead to worse outcomes for everyone, highlighting the importance of cooperation and collective action.

What is the prisoner’s dilemma? What is the dominant strategy? Why? And why is the dominant strategy flawed?

A situation where two parties must choose between cooperating or betraying each other. The dominant strategy is to betray, as it offers a better individual outcome, but this leads to a worse overall outcome. The flaw is that it undermines trust and cooperation.

What is the tragedy of the commons? What causes it?

When individuals overuse a shared resource for personal gain, leading to its depletion. It's caused by a lack of regulation or incentives to cooperate, and convenience. (people do not want to incur a cost for the saek of the whole)

How is the tragedy of the commons related to the prisoner’s dilemma?

both involve individuals acting in self-interest, harming the collective good. (cooperate for mutual benefit or betray for self interest, you can maximize individual outcome no matter what through betrayal… but its worst through the whole)

What are the three types of solutions to the tragedy?

• Regulation: Implement rules to control resource use.

• Voluntary Cooperation/ Self-Governance: Encourage collaboration through shared values and divide common resources.

• Creating markets (privatization): Divide resources and each individual takes on the cost of what they are putting out (responsible use)

Why is climate change an intractable or “wicked” problem?

it’s complex, involves many stakeholders, and has long-term consequences that are difficult to address with short-term solutions.

• No large scale regulating body (U.N. is an example why it doesnt work because they cant enforce it).

• Difficult responsible division

• Cooperation with differing cultures and values

• Wicked: consequences are catastrophic not finding a solution

What is the way out if we can’t solve the tragedy from within the system that creates the tragedy?

To solve the tragedy, systemic changes are needed, like global cooperation or changing underlying incentives and structures that perpetuate the problem

To create a new system:

New Systems: Tribal Economy and Degrowth

“Creative destruction” is a key feature of capitalism (perhaps what it does best)...what is it?

it’s the process by which old industries, technologies, or business models are replaced by new ones, driving innovation and economic growth.

Why does capitalism
encourage creative destruction?

capitalism thrives on competition and profit, which push businesses to innovate, improve efficiency, and replace outdated methods or products with better ones.

how might creative destruction relate to corporate social responsibility and corporate sustainability?

Creative destruction can sometimes harm society or the environment (e.g., job losses, pollution), but it also provides opportunities for companies to develop sustainable practices or products.

• Inefficient and unsustainable ways of doing things might be replaced with new ways of doing things. It might be the new norm to constantly destruct itself.

Why, according to Zink and Geyer, is there no such thing as a green product?

all products have environmental impacts at every stage (e.g., production, use, disposal). Even products labeled as "green" still involve resource extraction, energy use, and waste.

What do the authors think is a better solution? And why? (zink and geyer)

They suggest focusing on a circular economy—where products are designed for reuse, repair, and recycling, minimizing waste and resource consumption.

What is Zink’s argument?

the current economic system, driven by endless growth, leads to labor exploitation and environmental degradation. He calls for a new economic system that prioritizes sustainability, equity, and well-being over growth.

what does his proposed solution (to the twin crises and the master equation) look like?

a shift to an economy based on steady-state principles, where resource use is limited to sustainable levels, and labor is restructured to ensure fair wages and working conditions.

• Solution: Replace growth economy with tribal economy. Put a new system in. Tribal to him is democratic and organizing society that facilitates making a living.

• These 2 issues come from the same problem, so the solution should apply to both.

• Master equation: I (impact) = PAT (People x Affluence x Technology ) reduce a little of one.

• Whats wrong with green products and markets: consumption could be a solution to environmental problems (consumption is the problem) - Cant eat your way to less!

• Efficiency of green tech: it cant outpace our consumption (ISHMAEL)

• Affluence issue: We are happier when we buy less stuff. Less consumption is a realistic solution but not within growth economy.

What is the main cause for us exceeding planetary boundaries?

the endless pursuit of economic growth, which leads to overconsumption of resources and environmental degradation.

What is growth? And how is it distinct from GDP?

Growth is the increase in economic output, typically measured by GDP. Growth is often equated with GDP, but GDP doesn't account for ecological costs or well-being—it only measures economic activity

• Difference: Growth describes energy demand. Degrowth is scary because they think its an argument that GDP doesnt matte, but its not. Its arguing for energy demand to go down and be more efficent and sustainable.

• Key: Not synonymous, so not afraid of energy consumption going down even though it can lead to decreased rates of GDP

What is degrowth?

Degrowth is a movement for reducing production and consumption to sustainable levels. It focuses on well-being and ecological health rather than economic expansion

Why, according to Hickel, is degrowth controversial? And how is it distinct from recession

Degrowth challenges the dominant economic narrative that values constant expansion. Unlike recession (a temporary economic slowdown), degrowth is a planned and intentional reduction of unnecessary production and consumption.

How does degrowth recommend tackling the challenge of the global south

Degrowth recommends prioritizing global equity, sharing resources more fairly, and supporting the Global South in developing sustainable ways of living without replicating the harmful practices of the Global North.

• Solution: Not the global south that needs to degrowth but the global north. If the world is a company, take care of those youre exploiting because the company hinges on what they need to do. (think of dr bronners)

What does the Potawatomi creation story reveal about our role as human beings?

humans are caretakers of the Earth, responsible for maintaining balance and harmony with nature, not rulers over it.

What is the great delusion? And the challenge of our time

humans are separate from nature and that nature exists solely for human use. The challenge is reversing this mindset and reconnecting with the Earth as a partner.

How, for Kimmerer, does indigenous wisdom correct this?

teaching respect, reciprocity, and gratitude for the Earth, emphasizing our interdependence with nature.

What should the role of gratitude be in our relationship to the earth? And why?

Gratitude is central to our relationship with the Earth because it fosters respect, responsibility, and a sense of obligation to protect and care for the environment.

What does gratitude lead to? And why?

Gratitude leads to a deeper connection with nature, a sense of stewardship, and actions that protect the Earth for future generations.

What, according to Kimmerer, does the earth ask of us?

reciprocity—giving back in balance to what we take, treating the Earth with care and respect, and ensuring its health and sustainability for future generations.

What is the main takeaway from the Dr. Bronner’s blog post?

Businesses can thrive while prioritizing ethical practices, environmental sustainability, and social justice, proving that profitability and responsibility can coexist.

why does individual action matter in the face of systemic issues?

• Individual actions can create collective change by influencing cultural norms and demand.

• They signal values to policymakers and corporations, driving systemic reform.

• Small actions inspire others, leading to larger movements for change.