Both Forbes and His Critic Have It Wrong

Today an opinion piece by Thomas Sanders showed up on the Randex feed, and it caught my eye. It attempted to prove how wrongheaded Steve Forbes' earlier opinion piece had been in its characterizations of business and philanthropy, and his support of capitalism. [note: the linked website of the Arizona Daily Star may require free registration]

First, let's start with Sanders' reactions. He wrote:

In Forbes' mind, there is skulking about the land a long-standing, widely accepted cliché that business is bad because it is practiced by greedy, selfish people, and that charity, by contrast, is done by selfless people and is therefore good. He provides as evidence his interpretation of the words "giving back," "which are often employed in describing someone's philanthropic activity.

" 'Giving back' implies you took something that wasn't yours," Forbes says. "You succeed in business; you make up for it by giving your ill-gotten gains away."

I have to say, I love this characterization of the common phrase "giving back", and I think I'm going to use it from now on. OK, back to Sanders:

Where Forbes goes astray — far astray — is in his gross misrepresentation of what "giving back" actually means. Dictionaries define "philanthropy" as the effort or desire to increase the well-being of humankind through monetary contributions or other charitable aid. Within the context of true philanthropy, implicit in "giving back" is the concept of showing appreciation of and gratitude toward the society that made possible the amassing of wealth by returning some of that wealth to the society's worthy causes, thus benefiting — and improving — that society. [bold added]

Here is clearly where Sanders goes completely off the deep end. Society made possible the success of Henry Ford? Of Bill Gates? It is such an absurd statement that it's hard to believe an adult human actually holds that opinion. The only way in which society may be credited is that it stayed the hell out of the way and let these entrepreneurial geniuses get on with productive action. And I don't actually believe they should be credited at all, because simply refraining from limiting business is not an achievement.

Although he doesn't explicitly state it in his piece, his ideal is obviously altruism. He may not begrudge businessmen their success necessarily, but he certainly values their charity more.

It is indeed true that, because ours is a free society, no successful businessperson is obligated to be charitable. Fortunately, a great number of such prosperous individuals across America have not subscribed to Forbes' upside-down view of philanthropy and their benevolence has made our country a far better place.

Enough of Sanders. What did Steve Forbes actually say to get Sanders' dander up? He started off well, with the above mention of the term "giving back" and the implication that business success means ill-gotten gains. Here is the full quote from his piece:

On the other hand, charity is good, which it is. But think of it: How often do we hear the phrase "giving back," not "giving," but "giving back?"

"Giving back" implies you took something that wasn't yours.

You succeed; you've got to give back because you took something that did not belong to you. You succeed in business; you make up for it by giving your ill-gotten gains away.

Good enough so far. But here is where he proves himself a fatally flawed defender of capitalism:

Business and philanthropy are not polar opposites. They are, in fact, two sides of the same coin. The moral basis of commerce is meeting the needs of other people. You don't succeed unless you provide a product that others voluntarily want in a free market.

Productivity comes everywhere and this is the glory of free people, free markets. Our founders understood this. It's not selfishness because you don't succeed unless you meet the needs and wants of other people. A free system will allow you to develop your lawful talents to the fullest extent possible.[bold added]

After this, the rest of the article dances around this theme, but the overall meaning is clear. Forbes is defending capitalism and the individual rights of businessmen to (most of) the fruits of their labor because the ultimate ends of productive action are beneficial to others.

This view is so frustratingly disappointing because Forbes is seen as a champion of capitalism, and he gets so tantalizingly close to getting things right, sometimes. He uses many of the right words, so if you didn't read him closely you might come away thinking he really was defending individual rights and capitalism. Sadly, he is not, and he just makes everything worse by granting the altruist's premise that the moral justification of action is its benefit for others.

Strangely, Sanders picks up on this point and calls Forbes out on it, just for a moment.

But, what Forbes is actually saying is that, because it is moral at its heart and provides things that people want, successful business is the virtual equivalent of philanthropy — that the two are on the same side of the coin.

Of course that piercing and very accurate criticism of Forbes doesn't go anywhere. In the very next sentence, Sanders shows his true stripes:

He is also saying that the morality inherent in successful business and attendant, substantial profit makes "giving back" unnecessary, and that, by extension, it's perfectly fine to hoard money.

And here we are, back to the condemnation of those who wish selfishly to earn money through productive action. Unless of course they give a large amount of it away. As Sanders says to close, "That's what real philanthropy is all about." Remember, he also said that real philanthropy is "... the concept of showing appreciation of and gratitude toward the society that made possible the amassing of wealth by returning some of that wealth to the society's worthy causes...".

Forbes says, in essence, "Just creating a successful business is philanthropic enough!", and Sanders says in return, "No it isn't. You need to give more away." Forbes said business and philanthropy are two sides of the same coin, both focused on the needs of others. Sanders criticized his view, stating that Forbes' was implying they represented the same side of the coin, and instead advocating for more "true philanthropy" to balance out the implied evils of the business side.

Neither is right. Both are altruists, and it is their slightly differing approaches to the same basic ethics that represents the two sides of the coin. The same rotten, worthless, corrupt coin.


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Update: Edits to closing paragraphs - 03/20/08