Thinking about Ethics while reading The Big Short
When people think about ethics they commonly do so by using familiar rules and principles like ‘lying is wrong’ or ‘stealing is wrong’. For many people in many circumstances this is perfectly reasonable.
Philosophers who investigate ethics often claim that relying on such everyday rules cannot be a completely adequate way to think about these matters. For one thing, some of the specific rules accepted by one person or group are not accepted by other persons or groups. There is disagreement over whether the rule stating that homosexuality is wrong, for example, is true. Furthermore, some rules that are widely accepted are unclear about certain issues. Does the rule that states that lying is wrong prohibit withholding information from another person, or does it only prohibit uttering false statements? A third problem is that the familiar common sense rules can conflict. If I am sheltering someone who will be sent to a concentration camp, and thus following a rule that requires me to help others, I may need to lie to the security forces who have come looking for her, thereby breaking the rule about lying. The rules about helping others and not lying conflict here. And, finally, philosophers have often argued that a complete understanding of ethics requires some account of why these rules are true. Even if it is true that lying is wrong, it seems that the deepest thinking about ethics should tell us why that statement is true.
At least three types of ‘ethical theory’ are meant to address the difficulties just mentioned in everyday ethical thinking. They typically offer us certain abstract principles that are meant to explain the source or basis of many of the everyday rules. These principles will often help to address the other difficulties: for example, an abstract principle may be able to explain what the right thing to do is when two rules conflict. These ethical theories are often developed by philosophers, but sometimes by theologians. Some thinkers try to combine the theories.
Religious Ethics. Various religious traditions attempt to provide us with abstract ethical principles. Some Christians believe that all of ethics is based on the principle of loving others as one loves one’s self; some Jews also accept this idea. Another religious basis for ethics is the idea of always doing what God commands. Some Christians, Jews and Moslems accept this idea. This sort of approach obviously needs to be supplemented with an account of what God’s commands actually are. Other religious ideas in ethics include the idea of conforming to the purposes that God builds into the natural world, and the idea of living in a way that will ensure that one is reincarnated into a higher form of life.
Utilitarianism. One of the most important philosophical approaches to ethics is utilitarianism. This theory was developed by British thinkers in the 18th century and is still influential. The fundamental principle of ethics according to this theory is that the right act for someone to perform is the one that produces the most happiness for all the people that she can affect by her activity. (This is sometimes called The Principle of Utility or the Greatest Happiness Principle.) Utilitarians believe that, generally speaking, acts like refraining from killing and telling the truth produce more happiness for all the people affected by them than killing or lying would. This is meant to explain why killing and lying are wrong. It can also explain why utilitarians are prepared to say that everyday ethical thinking is often perfectly reasonable. However, many utilitarians believe that lying and killing can sometimes be right—a position that is not accepted by all people who use everyday rules in their ethical thinking. If a utilitarian believed that a certain lie is not wrong, she would need to show that telling that lie produced more happiness for everyone affected by it than would not lying.
Deontology. This is one term used to refer to the ethical theory originally developed by Immanuel Kant (1724-1804). It is a very important part of contemporary philosophy. Kant is famous, in part, for making two proposals about how to understand the fundamental principle of ethics. One proposal is, roughly, that an action is wrong if no one could succeed in acting that way when everyone tried to act that way. (A question that we often use in ethical discussion—“what if everyone did that?”—seems to be related to this proposal.) Kant gave a famous example to illustrate his thinking. He imagined that someone was willing to tell a lie in order to secure a loan. He noted that it might be possible for this person to succeed in securing the loan if she were adept at lying. But, he said, if every person tried to tell a lie when she wanted a loan no one would succeed in securing it. That is because lenders would know that this strategy was being used, so they would refuse to offer credit. Kant also is famous for another proposal he gave for understanding the fundamental principle of ethics. This principle states that we must never treat human beings merely as means, but must always treat them as “ends in themselves”. Part of what he seemed to mean by this statement is that it is wrong for someone to treat other human beings simply as a way for the agent to achieve her own goals. In order to behave ethically, Kant thought, she must treat other persons as beings who have their own goals. To treat other people as beings who have their own goals is, in his terminology, to treat them as an “ends in themselves”.
~Steve Sverdlik, Ph.D., is an associate professor and acting department chair in the Philosophy Department at SMU.
Click here to learn more about Sverdlik.
If Little Else, Banker’s Trial May Show Wall St. Foolishness
By STEVEN M. DAVIDOFF of The New York Times
A midlevel former banker at Citigroup, Brian Stoker, is in court this week in connection with his role in creating exotic mortgage securities. While the civil trial is being hyped as a great exposé of Wall Street’s role in the financial crisis, it may be something more banal, merely showing how clueless financiers can be. Read the full story from the New York Times here >>
Professor of Philosophy Steve Sverdlik recommended this article because, in his own words, "As this story makes clear, there have been very few criminal prosecutions of people involved in creating the risky securities that are central to the events in The Big Short. Notice too, that the prosecution under discussion is taking place in mid-2012, some five years after the collapse of the mortgage security market began. Also, the defendant in this prosecution is described as being midlevel. It is interesting to think about why this prosecution has taken this long, and why no officials higher in the corporation are being charged with crimes."