Some fans of economic freedom have been worried in recent years that anti-capitalism is rife on U.S. college and university campuses, from Competitive Enterprise Institute founder Fred L. Smith, Jr. and Rainer Zitelmann writing in Forbes to people who have come to the conclusion that the anti-capitalists have even made it to Harvard Business School. This pessimism about markets on campus made me especially excited when I recently heard about an interesting development in higher education. Troy University in Alabama has launched a new program at its business school that looks promising. The university’s Manuel H. Johnson Center for Political Economy has a new Free Enterprise Scholars program. That’s being overseen by Allen Mendenhall, who is Associate Dean at Troy’s Sorrell College of Business.
As part of the program, the Free Enterprise Scholars will participate in the Johnson Center’s fall and spring reading groups, attend monthly events, and write op-eds about free enterprise. Scholars will take a course called Moral Foundations of Capitalism, attend academic conferences, and take field trips. I think the op-ed writing is especially interesting, since it signals an effort to take the ideas they’re learning into the world of public debate and politics rather than just applying them to an academic understanding of the topics in question.
Mendenhall said about the program:
The moral value of free enterprise means that business leaders do not have to apologize for profits earned honorably or purchase absolution through wokeness. Future business leaders and entrepreneurs should know this and be able to be articulate spokespersons for the moral value of business, properly conducted.
That idea is important. For many people in America, making a profit means that you have taken something from society that you then have an obligation to give back via charitable contributions or some other corporate do-gooding. But in a market economy, profits flow to those who satisfy the wants and need of consumers. Voluntary transactions are a positive-sum experience that leaves both sides better off. Profits aren’t a moral debt that need to be re-paid – they’re proof that you’ve served your customers and have already provided a benefit.
So, while we may have any number of charitable causes that we as individuals choose to support, the business world doesn’t have some kind of joint and several moral liability it needs to pay off just for existing. The “social” benefit of capitalism is the products and services it supplies. Its moral status already has a positive value – even without signing up for any ideas with names like corporate social responsibility, socially responsible investing, or environmental, social and governance theory.
If you’re interested in learning more about how business can be a moral enterprise without giving up its profit motive, I recommend the work of Prof. James Otteson of Notre Dame University. He’s the John T. Ryan Jr. Professor of Business Ethics there, and he’s written several books relevant to the issue. In particular, I would highlight his 2019 book from Oxford University Press, “Honorable Business: A Framework for Business in a Just and Humane Society,” and his 2021 book from Cambridge University Press, “Seven Deadly Economic Sins: Obstacles to Prosperity and Happiness Every Citizen Should Know.” We also covered this topic on Episode 15 of the Free the Economy podcast. Listen here, starting at 8:22.