Self-Interest and Cooperation

This is adapted from a letter to the author of an article in a college newspaper.

In your article you make a good case that cooperation should be at least as respected and respectable a motivation as advantage.  However, I think you go too far when you say:

Economics, as a discipline, assumes the worst in each of us. It assumes we are motivated by self-interest. It puts a price tag on our ambitions. It auctions off what makes us human.

Don’t demonize self-interest, or assume it is “the worst” in us.  Not to get all Ayn Rand on you, but self-interest as a motivation has a long and honorable lineage and serves a useful purpose.  Self-interest is what brought us up from the ocean and down from the trees.  Self-interest has historically been the engine of exploration and discovery in every field, and to this day motivates almost every technological advance.  It’s why Eli Whitney invented the cotton gin!  Even the impulse toward cooperation is based on self-interest, because we feel if we cooperate we will be better off.

It is certainly true that self-interest, left uncontrolled, leads to harsh conditions in society.  But the remedy for this is to use government to impose humane conditions rather than to try to undermine the motivation.  Self-interest leads manufacturers to make useful (or at least desirable) things and thereby create employment and wealth.  It also leads them to try to maximize their advantage by employing child labor in 16-hour shifts.  Let’s keep the factory but humanize the working conditions (and appropriate a good chunk, but not all, of the wealth), and while we’re at it bring in a nice juicy labor union (which operates of course on the workers’ self-interest – labor solidarity is a calculation of self-interest).  Capital will comply because it has become in their self-interest to do so.  If you remove self-interest as a motivation for human activity (which you couldn’t do, but suppose you could) why would anyone invent or manufacture anything? 

I can’t agree with you here either:

Economics has come to dominate the intellectual underpinnings of our society. We have internalized its assumptions as our own, and it has become a self-fulfilling discipline. Why can’t we all just get along? I submit that it is because economists tell us we can’t. Economists tell us we live in a world premised on scarcity and opportunism, and so we behave as if they were right.

Economics is a descriptive discipline, attempting to mirror and explain existing conditions.  We don’t fail to get along because economists tell us we can’t; economists tell us we don’t because … well … we don’t.  We compete instead.  A cooperative approach will succeed only if people are persuaded it will advance their self-interest more than competition will do.  And often it will – there’s that labor union again – although even there the interests of labor are naturally opposed to the interests of capital.  Also, if you merge labor and capital into a cooperative enterprise, even this enterprise must compete against the rest of the world for market share.  The only way around this is to impose a socialist monopoly by force, a practice that has never had good results for anyone and which I am sure you would not favor.

No, the secret is to mitigate the effects of unbounded self-interest by bounding it, and to encourage cooperation by appealing to the self-interest of the cooperators.

Alas, there really is no free lunch.  A lunch freely given is still paid for.  Despite what you say in your article, a score is kept at the potluck where everyone brings something – indeed, the word goes out in advance: bring something.  This is functionally indistinguishable from a tax, except the penalty for avoidance is social rather than penal.  But the potluck is not free.  Neither is the soup kitchen, as you undoubtedly know from raising money to support one. 

You write: “Economics treats cooperation as freakish, setting expectations only of ruthlessness and greed, to the detriment of us all.”  But I think you are setting up a straw man here.  Economics, as a descriptive discipline, recognizes cooperation when it sees it happen, for example in a family, or in a truly cooperative enterprise.  But if it is rare on the macro level, perhaps that’s because it is not our natural impulse at that level.  People bank at the credit union mainly so they will have access to credit themselves, not to give opportunity to others.  And even the credit union charges interest.

So don’t blame the messenger, or put Descartes before the whores.  Economists are just reporting what they see, not telling us how to act.  If the more rapacious of the plutocrats want to elevate self-interest to a principle of government (to the detriment of the actual self-interest of the masses), and squeeze parks and libraries to pay for tax cuts for themselves, the solution is to elect a progressive government that will tax them fairly and protect us from their rapacity.