Ethics and economics may not be natural allies, but they have potential for a mutually complementary relationship. This is something the policymakers will have to harness if the economy is not to be emptied out of moral compunctions.
Individual profit motive, personal wealth creation and self-aggrandizement are primal instincts in human behavior. But such instinctive personal drives cannot be allowed to supersede the state's obligations to pursue and facilitate realization of collective goals for the greater good of the nation. These have to do with national wealth creation, resource exploitation for an exponential growth, egalitarian distribution of wealth, improvement in quality of life, welfare and secure future for all citizens.
At the 20th biennial conference of the Bangladesh Economic Association themed on "Economics and Ethics" last week-end Professor Rahman Sobhan pinpointed ethical failures in a number of sectors. These ranged from capital market, banking sector and commodity market through the apparels, public service, access to healthcare and quality education.
He noted, 'there is also ethical failure in the country's democratic system and the democracy needs to be democratised', Professor Sobhan pointed out, "If the current politics of money were previously in practice, Bangabandhu and Tajuddin would have failed to join politics, came as they did, from 'modest families'.
The capital market is now run through speculations and it is like a 'casino' where gambling is a common affair, regretted the renowned economist. He minced no words to say, 'the RMG entrepreneurs are enjoying the first- world facilities here, while the people, who are helping them to build their assets, are living in third-world country.'
He appears to have hit the nail on its head when sequencing political patronage, connections, entry into the banking profession and the favour being 'leveraged to accumulate personal wealth.'
Then he went on to 'the other ethical crisis': the default culture. Adding in despair, 'most borrowers know that they do not need to repay their loans on time as they will be bailed out by way of rescheduling; so now you have a built-in process of default and rescheduling.'
The worst feature of this is that 'it has destroyed the competitive nature of the financial sector. Its credibility, too has suffered a setback.
The Octogenarian economist having a long association with the country's political and economic developments, admits, "I am not quite sure how we are going to find a way out of this."
His emphasis on 're-computing GDP' is, however, indicative of a pathway to new value assessment. He recommended addition of household labour by women and subtracting the cost of environmental damage.
He also called for inclusion of capital flight 'in the balance of payments accounting'.
Thus recomputed, we will then get an accurate measure of 'what is happening to the economy, who is contributing what to the economy'. "And then you will get an ethical appreciation of the real state of the economy", the professor emphasized.
Dr.Mohammed Farasuddin,an eminent economist while presiding over a plenary session on the first day (Thursday) of the BEA biennial conference on Ethics and Economics made a very valid recommendation. He suggested including behavioral science in the economics curriculum to uphold morality in society. Pragmatically, he added though that a universal concept of morality had to be agreed to by all concerned before any all-encompassing solution can be found to ethical questions. We have a very strong grounding in ethos that contributed signally to the success of our Liberation War.
But good ideas have a gestation period; so the sooner we begin implementing them the quicker they'll yield results. Alongside curriculum enrichment with ethical inputs to produce patriotic professionals in every field we have to craft a national code of ethics in the light of experience to root out the deep-seated ills of the system.
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