It is a fact of history that the market system has uplifted millions of people from poverty and is capable of uplifting many more if it is allowed to function properly. Societies with just pride in their freedom, inclusive of economic freedom, and graced with a concern for the freedom of others, need all the self-confidence that will give them further momentum.

It is the creative, bold and even courageous character of those who ventured into uncharted waters that created wealth and uplifted living standards. In Malta, we need more of them.

Somehow, there is a tendency to respect explorers but to begrudge the men who invented and marketed the first printing presses and electrical systems, and mass produced motor cars and computers.

All of these deserve better from academic chroniclers of western civilisations, whose ignorance comes not from reading too much Adam Smith, but from failing to read him at all.

Commitment

A market system with a social conscience implies commitment to moral standards. If private morals are thrown overboard, the state increasingly finds reason to step in and take over. Moral perceptions are a powerful force among men and, if we were to allow the myth to stand that the social market system is inherently immoral, we shall, sooner or later, lose our freedom.

True enough, the market system may be flawed if it were unregulated and allowed to flout the so-called rules of the game. Businessmen are mortals. They are not saints, but neither are they all devils. Like the rest of us, they require the restraint of law and ethics. So long as the businessman plays by the rules, he is expected to perform to his optimum capacity. This is what serves the greatest social and economic good. In this context, self interest is not the same as selfishness. It is, on the contrary, a positive factor.

Clear vision

This needs stressing. It is necessary to develop a clear vision of how the market system actually functions.

Man being fallible, there will always remain, as there are today, moral shortcomings of intentions and performance worthy of critical scrutiny. But the concept that entrepreneurship is inherently selfish leaves out a vast topography where most behavior by decent and well-intentioned persons take place.

A social market system needs the state to ensure that society acquits itself of its obligations to assist citizens on their lawful business, and others in need or in distress, out of the wealth that is created – and this by a system of fair distribution.

The state is needed to ensure that the rules of the market game are observed on a level playing field and to provide regulators that will operate the machinery of compliance with competition and fair trade.

Upholders of ethical and moral rules, who rightly demand that neither the state nor the market should dominate society, and that both of these should be tools in society’s hands, would do well to highlight the merits of legislation like the Competition Act or the Consumer Protection Act. They would do well to plead for a Whistle Blowers Act and for strict and unremitting enforcement of market discipline.

Anti-market demonology

It is strange but true that the anti-market demonology is sometimes fuelled by clerics and social scientists who bring up for discussion the moral basis of the market. In its more energetic appearance, the assault upon the market system adopts the logic of Karl Marx. Thus one hears statements like: “The spirit of the market is based on the philosophy that seeks to enrich the rich”, “Under the market system, when A wins, B loses” and “One class produces the surplus, and the other appropriates it”.

The true nature of the market is to satisfy needs. Any economic system, must produce more than it invests, if it not to stagnate. But it must invest before it produces, And it must save before it invests.

Investment, on the other hand, must yield capital accumulation. Profit is, therefore, a condition of development. Without it, there are losses or stagnation. It behoves us to think about the creative causes of wealth and to aspire to encourage moral market forces capable of blowing fair, strong winds into our economic sails.

Sad commentary

It is a sad commentary on the sociology of knowledge in the Maltese church that so few theologians or religious leaders seem to understand economics, industry, manufacturing, trade and finance. They seem trapped in old-fashioned modes of thought. If they intervene at all, they demand jobs for the unemployed without comprehending how jobs are created. They demand the distribution of wealth without insight into how the store of wealth may be expanded. They demand ends without critical knowledge about means. They could not be credible leaders without having mastered the techniques of human progress.

It is high time that we move ahead.

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