Commerce
By Michael Phillips
Copyright 2004
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Table of Contents
Introduction
Nearly all of us live in the world of commerce. The surface wave of commerce began several thousand years ago. It grew rapidly a hundred years ago; now our lives are engulfed in the tsunami of commerce.
Today, the words commerce and modern world describe nearly the same thing. Neither can exist without the other. The tsunami of commerce created our modern world.
The term commerce, as used in this book, means more than the word business. Commerce is broader because it includes barter. Barter is commerce, but not business. Businesses can succeed or fail. Commerce and only be suppressed.
Over the past century, communist governments disbanded businesses and tried to eliminate commerce, but communism never succeeded in burying it. When I visited Moscow in 1981, commerce was alive and well in nearly every alley, offering souvenirs, currency and sex. Business can be destroyed but commerce can’t.
Commerce is a unique system that contrasts with: the military, the arts, government, the intellectual world and religion. Each of these provinces - government, intellect and religion ‑ have a different mind-set than the mind-set of commerce. Soldiers, participants in the military, have a different worldview than participants in commerce. Commercial people and the commercial mind are distinct.
Chapter 1 Commerce is indifferent to morality
Many people consider commerce a part of our current moral system. They believe that good people are rewarded with money and success. Such a moral view leads to confusion in understanding what commerce really is.
Commerce is indifferent to our current moral order. Commerce enthusiastically delivers immoral products: drugs, contraband, slaves and so on. Commerce readily provides illegal goods to any buyer and can reward immoral people with great wealth.
We need mental tools to understand and appreciate the moral indifference of commerce. In this chapter, we compare commerce to other morally indifferent systems such as technology and science.
Chapter 2 New commercial values
Commerce thrives when specific social values are present: diversity, openness, meritocracy, markets, technological affinity and decentralization. The presence of these values promotes commerce, and their absence retards it.
Chapter 3 Commercial Minds
Living in a commercial world promotes a commercial mind in each of us. Among the many attributes of the commercial mind are: the monetizing of nearly everything, the unlimited potential for avarice, cynicism, blasé attitudes, the rise of irony in our perception, the adoption of a managerial perspective, the elevation of whim and selfish absorption to major living values, and the emergence of global commercial behaviors.
Our commercial mind also values and expects a world of constant surprise and becomes inured to wonder.
Chapter 4 Commerce and the State
The vigor of commerce, in any country, depends on the government. Commerce needs a government that is neither too weak to protect private contracts, including citizens’ property rights, nor so strong that it squashes those contracts whenever it wants to. The government we have in the United States does well with commerce; the government of Cuba does poorly.
It would be helpful to know how a government can promote commerce by fine-tuning laws, taxes and government agencies to create exactly the right mix of not too weak and not too strong.
Unfortunately, right now, in the beginning of the twenty first century, we aren’t close to knowing the right mix of government policy that will promote commerce.
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Introduction
I opened an old leather-bound register in the archives of my employer, the Bank of California. An entry in March 1906 showed that my grandfather had taken out a commercial loan for $5,000. The rest of the line was blank. Grandpa Henry never repaid that loan.
Commerce
Nearly all of us live in the world of commerce. The surface wave of commerce began several thousand years ago. It grew rapidly a hundred years ago; now our lives are engulfed in the tsunami of commerce.
Today, the words commerce and modern world describe nearly the same thing. Neither can exist without the other. The tsunami of commerce created our modern world.
The term commerce, as used in this book, means more than the word business. Commerce is broader because it includes barter. Barter is commerce, but not business. Businesses can succeed or fail. Commerce and only be suppressed.
Over the past century, communist governments disbanded businesses and tried to eliminate commerce, but communism never succeeded in burying it. When I visited Moscow in 1981, commerce was alive and well in nearly every alley, offering souvenirs, currency and sex. Business can be destroyed but commerce can’t.
Commerce is a unique system that contrasts with: the military, the arts, government, the intellectual world and religion. Each of these provinces - government, intellect and religion ‑ have a different mind-set than the mind-set of commerce. Soldiers, participants in the military, have a different worldview than participants in commerce. Commercial people and the commercial mind are distinct.
Business is a part of commerce and nearly all major institutions. Each major institution, such as the military and the arts, has within it a form of business, such as the purchasing of military supplies and the selling of tickets to theatrical performances.
To understand and appreciate the modern world[1], it helps to recognize the indifference of commerce to traditional morality. For me, the first step in understanding the modern commercial world was my acceptance of this state of indifference.
Accepting the indifferent nature of commerce reduced my confusion about the role of commerce in our existing moral and cultural orders.
Technology and science are good models for understanding and appreciating the value of the morally indifferent systems that exist around us. These include technology and science.
With an understanding of the morally indifferent nature of commerce we can move on to the second chapter in this book, appreciating the positive values inherent in the emerging commercial world.
The third chapter of this book examines the interaction between our individual minds and the commercial world we inhabit.
The final chapter of this book examines how commerce thrives or falters within the larger world of politics and government.
Morally Indifferent Technology and Science
Technology seems to fight a never-ending battle with other human institutions because of its indifference to existing morals. In 800 B.C.E., Indian surgeons restored amputated ears and noses and removed tattoos from their patients. The surgeons, pioneers to whom we are now deeply grateful, were condemned for interfering with the judicial processes and offending the morality of their time. The courts had amputated the ears and noses and branded the victims with tattoos as punishment.
In the past several decades, medical practitioners have gotten better at preventing human conception and terminating pregnancy. Many people today are offended by the use of technologies that allow contraception and induce abortions. Indifferent technology has a never-ending fight on its hands. When technology brought the next development in birth control to market, the “morning after” pill, RU482, the whole moral battle was reengaged.
Science, too, often gets into trouble because of its indifference to morality. When Copernicus determined that the earth orbited around the sun and was not the center of the universe, religious opposition was vehement, and sometimes lethal. For more than a century, the Roman Catholic Church, the Inquisition and many Protestant denominations rejected Copernicanism and punished, even with death, Copernican advocates.
The same strong reaction against science was evident centuries later with the scientific advances in geology and evolutionary biology. Science proclaimed a long history for the earth, billions of years, not the instant creation told of in Genesis, and announced evidence that life on the earth connected single cells to plants, trees, insects, pigs, monkeys and humans. The prevailing moral order fought back, and some parts of it still are.
Social Values
Commerce thrives when the right social values are present in a society but it struggles when those values aren’t present. The difference between right and wrong social values is the difference between a lush valley and a sparse desert. The values that nourish commerce are fruitful: diversity, openness, meritocracy, markets, technological bias and decentralization. The presence of these social values promotes commerce while their absence restrains it. These social values are discussed in detail in Chapter 2. In general, many people consider these commercial values positive values.
We have a long history of ignoring the positive contribution that commerce makes to our society and its values. Many of these social values were in place before the explosion of commerce; commerce has rewarded those societies that have these values.
Commercial Mind
Living in a commercial world promotes a commercial mind in each of us regardless of the extent of our commercial-market immersion.
Among the many qualities of the commercial mind to be aware of are the fungibility of nearly everything, the unlimited potential for avarice, the triumph of cynicism, blasé attitudes, the rise of irony, the adoption of a managerial perspective in daily life, the elevation of whim to a major factor in human behavior and the emergence of global commercial behaviors.
Some qualities of the commercial mind are negative, some we take for granted, some are neutral and a few may be positive. The commercial mind and its impact on our society are considered in Chapter 3.
The State and Commerce
We have many nation states on this twenty-four-thousand-mile round planet and we can compare them with each other to see where commerce flourishes and where it struggles. This surfeit of nation states allows us to answer the questions “What state policies promote commerce, and what state policies stifle commerce?”
Nation states where commerce thrives, such as Singapore, immediately come to mind. Nation states where commerce once thrived but has been almost extinguished also exist. In Cuba, for example, commerce is struggling to reassert itself.
Our pool of Nation states provides a laboratory that tells us which state policies promote and which retard it.
Examining a large array of nation states, we find strong arguments that commerce thrives in societies that have diverse populations, that value openness and honesty in communication and that place a premium on meritocratic workplaces.
We also find that commerce can thrive when the state is neither too weak to enforce private contracts, including property rights, nor so strong that the state can abrogate these rights. Commerce can’t do well when el presidente can imperiously confiscate a successful business and hand it over to his brother as a gift.
Recommending the ideal balance between the extremes of a weak state role in commerce and too great a state role is not what this book is about. This book aims to understand the reality of commerce. We know that finding the right mix of state control and commerce is possible, over time, when interested people perform the right scientific experiments and study the right data.
Understanding the relationship between the state, its people, and commerce is not simple. We Americans take a great deal of a successful governmental and commercial system for granted.
· We can take anyone to court to settle our personal differences.
· We serve on juries that adjudicate contractual disputes for billion-dollar corporations.
· We would never let the sheriff’s brother take over our home for his family without compensation.
· A package sent through the postal service that has been opened and pilfered is unacceptable.
· We are outraged when we think a neighbor got a zoning permit in return for a bribe, and we consider it a social goal to eliminate this type of behavior.
We Americans perennially debate tax policy on city, state and national levels. We debate whether taxes should be progressive or regressive or neutral. We have a never-ending debate on the types of taxes we prefer: sales tax, income tax, excise tax and so on. We debate government deficits, tariff barriers, free trade, public education, drug use in the workplace and much more. We fight our battles about commerce and the role of the state at a high level of intensity and vigor. We don’t have clear solutions.
Making sense of these state-commerce interactions requires research, experimentation and extensive study. This process is just beginning.
In the past two hundred years, we have gone from a world of modest commerce with only a few prosperous participants living in a few cities to billions of commercial participants in hundreds of thriving urban areas, with trillions of dollars in income and luxurious lives that were formerly unimaginable.
We have gone from traditional homes shared with farm animals, from lifetime travel usually limited to a small radius, and from living with high infant and maternal mortality to a very different world. Two hundred years of commerce has overwhelmed us with a large population that is literate, healthy, that lives a long time and that travels over vast expanses rapidly
Our history of commerce has created a large population that enjoys a wide range of emotional comforts and physical luxuries.
It is reasonable to expect a change in the worldview and personal perspective of the people who have undergone these changes. Some transformations were expected and many more have arrived unanticipated.
One change of perspective has not occurred in the period since the tsunami of commerce has inundated us. That change in perspective is the modest goal of this book: to encourage a deeper appreciation of commerce.
Chapter 1
A loan ledger in the Bank of California archives shows that a loan to my grandfather was made in March 1906. Grandpa Henry Phillips was a dentist practicing in Union Square in San Francisco. In April 1906, downtown San Francisco was destroyed by earthquake and fire. My grandfather closed his practice and left the country with my grandmother. The loan was never repaid.
Indifferent to Old Morality
Many people believe that good people are rewarded with money and success. Such a moral view leads to confusion in understanding what commerce really is.
Commerce is indifferent to traditional morals. It enthusiastically provides immoral products such as drugs, contraband and slaves. Commerce readily delivers illegal goods to any buyer and can reward morally corrupt people with great wealth.
We need mental tools to understand and appreciate the indifference of commerce. In this chapter, we compare commerce to other morally neutral systems such as technology and science.
As we will discuss in Chapter 2, commerce does have positive social values, however. Oddly enough, it is the moral indifference of commerce that underlies its genuinely positive values.
One clear way to understand this dynamic is to examine other morally indifferent institutions that have created out modern society.
Technology
Beer, wine and whisky are the products of early technology. These alcoholic beverages have been the targets of moral outrage in many societies over the centuries.
The same technology of controlled fermentation creates bread and yogurt, which don’t evoke the same moral outrage.
In its broadest definition, technology is all human-made and human-organized arrangements of the physical world intended for human use. A chair is an example of technology - from the most rudimentary log used for sitting next to a campfire to the more complex example of an ejection seat in a jet fighter. Knives and forks, drinking glasses, reading glasses, clothing and shampoo are the products of technology. Each is a human artifact created for human use.
We humans have a long history of technology; from making a smooth footpath hundreds of thousands of years ago so our tribe could walk faster and carry large loads, to the undersea fiber optic transmission cables of today, which carry international communication.
Technology for human use doesn't necessarily mean for each humans benefit. Technology can be used for both good and evil. A knife can cut a loaf of bread to share with friends or to cut a fellow human's throat in anger or warfare.
Because technology can be used for both good and evil it is neither moral nor immoral - it is indifferent to morality. The thousands of people who developed knives over thousands of years were driven by countless motivations. The creators of knives were driven by an even greater variety of motivations in selling the knives. The entire venture of the creation of the knife belongs to the morally indifferent history of technology.
War, murder and a wide range of human inhumanity to other humans are closely connected with technology, from the most rudimentary chipped arrowhead on a spear to a laser-guided missile launched with an eight-hundred-pound bomb tip.
Selecting a single technology of war and identifying it as evil, doesn’t work. Defining the laser-guided missile as evil does not properly place the missile in the framework of technology. We would be ignoring the phone call to the missile-launch commander, which uses phone technology, the missile launcher made of steel and derived from advanced-material technology, and we would be ignoring the fact that the designers of the bomb did their design work in buildings that were the product of technology. Since technology is pervasive, it is not possible to separate out the particular part of technology that is used for good or evil. Technology is pervasively used for both.
Technological objects and processes are used in everyday life, and everyday life is filled with moral and immoral actions. An ice cube can be added to a glass of water to give to a sick and thirsty ninety-year-old neighbor. The same ice cube could be used by an indiscreet uncle to serve a ten-year-old nephew a glass of whiskey.
Technology is also indifferent to morals because the humans who make technology don’t have a universal moral system. Moral and immoral refer to social and cultural standards that are not universal. Consider the wide range of technologies that are designed to induce human fetal miscarriage. Some readers would consider these technologies immoral; others would consider them moral, maybe even virtuous.
A great deal of technology is designed for purposes that some people consider moral and others consider immoral. The list of examples is long and includes chemical poisons used in warfare, weapons designed to maim soldiers, plant poisons sprayed on marijuana plants to make marijuana smokers ill and the classic electric chair for state executions.
Each of these examples has supporters who consider the particular technology moral and others who consider them immoral. Weapons of war are considered moral when used for defense, national liberation and "just" wars in Roman Catholic theology. Poisons sprayed on marijuana plants are considered moral by opponents of that drug and immoral by users of marijuana. Opponents of the death penalty can consider electric chair technology immoral while death penalty supporters treat it as an instrument of morality.
A technology can change from being popularly considered moral to immoral and back to moral. Thalidomide was used as a drug for reducing nausea in pregnant women in the mid 1950's -- a morally positive use of the drug. Thalidomide became immoral to administer when if was found to produce limbless children. Thalidomide became a morally acceptable drug a decade later when it was found effective in treating leprosy. It is best to treat the pharmaceutical technology that developed Thalidomide as indifferent to morality.
Increasingly, technologies have become extensions of our body and mind; they enlarge our systems of expression and perception. Over centuries, we have gained the ability to move faster, to communicate over larger distances, to perceive smaller objects and to move heavier loads as well as to work with delicate microscopic objects. These technological extensions of ourselves can be used for moral or immoral functions. Think of a telephone or an automobile. Because each seems to be an extension of ourself it is easy to use a phone for insulting someone or helping a friend and to use a car to take a pregnant woman to the hospital for a delivery or get rid of an unwanted cat out in the country. But the car and the phone are not really extensions of ourselves: They are morally indifferent separate objects.
The automobile works because it is morally indifferent. Imagine that you were an anti-Semite or an anti-white Black who would avoid taking a walk with a dozen Jews or half a dozen whites because it would violate your moral code. You wouldn't likely go for a casual stroll in a Jewish or white neighborhood.
But if you want to drive an automobile, you have to be willing to drive with an unknown number of Jews and whites driving behind you, in front of you and next to you. The moral indifference of the automotive traffic system is what permits it to operate. The same is true for driving through neighborhoods. In most cases, the technology of traffic does not tell drivers what neighborhood their car is morally designed to drive around in.
The same moral indifference of technology is true for the telephone. The telephone does not listen to your voice and say, "I don't make phone calls for gay men, African-Americans, Floridians, people with New England accents, people under twelve or people who weigh more than one hundred kilos." The telephone is morally indifferent. Thank goodness. That is why the telephone system works.
While you may not be in any of the hypothetical groups listed above, you might have friends, relatives or clients in these groups and have a need to reach them by telephone. A telephone system that would not connect to people based on any belief system (moral or immoral) would not be a useful telephone system. We need a morally indifferent telephone system.
One of the interesting arguments in the history of technology is that some moral systems retard technology. This argument is made by David S. Landes in his landmark book Revolution in Time: Clocks and the Making of the Modern World (Harvard University Press, 1983). Landes reviewed the rapid development of clocks and watches in Europe in the 1500 to 1700's. He studies the absence of clock development in China during the same period at a point when China had many advanced forms of technology from gun power to moveable-type, to printing presses and paper. Landes concluded that comparing Confucian morality versus European commercial moral indifference yielded the best explanation for the significant difference in the developments in clock technology.
In China, the time for a meeting was set precisely, but the social hierarchy within the Confucian system determined the nature of the encounter. The lower-status person always came early. If the meeting was set for 11 a.m, the person with lower status used shadows in the street like a sundial (Chinese streets were usually laid out north-south and east-west) to come early, well before 11, and the other person came as close to 11 as suited his or her status. We still have the phrase "fashionably late" referring to social-status time considerations.
Landes points out that Europe was developing a non hierarchical commercial system, where many people had to meet regularly for business and trade without knowing who had higher social status. European businesspeople used clocks so that both parties could arrive at the same time. This arrangement produced a demand for more accurate clocks, more public clocks and, ultimately, for watches. Middle-class merchants were the first people in Europe to have clocks inside their homes.
The technology for clocks and watches was better suited to a morally indifferent system where social class was unknown. The morality of class hierarchy was an obstruction to technology; the moral indifference of technology, which permitted it to operate as if it were in a society of social equals, was conducive to technological development.
Science
The first example of the moral indifference of science that comes to most people’s is Galileo Galilei. Excommunicated from the Roman Catholic Church in the early 1600s, Galileo refused to renounce the Copernican theory that the earth rotates around the sun. The Catholic Church viewed the Copernican heliocentric view as immoral and a threat to the teachings of the Church. The Inquisition targeted followers of Copernicus.
Isaac Newton, often considered the first great physicist, went out of his way to argue that his scientific work on light, calculus and motion was consistent with existing religious morality, so that religious authorities would not punish him.
The evolutionary issues raised by the scientific theories of Charles Darwin were considered a direct threat to much of established religion and morality when first published in the mid-1800s. Many of the scientific arguments raised in Darwin's day continue to threaten religious moralists in America today. Science has been in conflict with religious norms for several centuries and has been attacked as a threat to the moral order as a result.
Science is often used to prove the validity of some moral point or to disprove it. Since science is empirical, a scientific proof one day can disappear the next and leave the moral arguments subverted. This has been the case for many health claims and many medical discoveries that had moral or immoral values attached to them.
For many years, popular writers argued that a wide range of species of birds were monogamous. The scientific evidence of this was offered as proof of the moral value of monogamy. DNA research has since found that the birds, so often glamorized in the past, were actually cheating on their mates.
As centuries pass and more people learn to live with science, the morally indifferent nature of science becomes a more comfortable reality. Science is an empirical approach to the world, a world that exists independent of human conceptions. As a consequence, when science is interacting with a real world, it cannot be expected to support preexisting human moral systems. Science works when it is morally indifferent.
Moral Indifference is Acceptable
Technology and science are accepted parts of our society. The detailed processes of technology and science and the specific steps in the processes are what we accept. Examples of our acceptance are the following:
- We can read a science journal as if we were the wealthiest or the brightest of people.
- We can setup a nuclear magnetic resonance machine in the same way as anyone else, regardless of our sexual preferences, our religious beliefs or our country of origin. Being a technologist or doing science involves independent steps and detailed processes that ignore our personal moral status.
- We can stand before a piece of technology, say a measurement device, that takes voice commands, with the same acceptance (the measurement device accepts us), whether we are strong or weak, whether we are educated or not and regardless of our ethnicity.
The neutral mechanisms of technology and science are indifferent to morality.
Commerce is Indifferent to Traditional Morality
Like technology and science, commerce displays an indifference to traditional morality. There is no way a commercial transaction will occur or not occur because of the moral values of the individual carrying out the transaction. If a drug-dealing, obese, seven-foot giant with splotchy skin and wearing a fur coat on a hot day tries to buy a microwave oven in a store that sells microwave ovens, the transaction is just as likely to occur as if the person were a mild mannered sixty-year-old matron. If the giant has a problem buying the microwave at one particular store, he or she will find someone somewhere else who will sell it.
The buyer can be moral or immoral, and the seller can be moral or immoral but the commercial transaction will occur because commerce is indifferent to morality.
Commerce has no effective mechanism to judge buyers, morally or otherwise. There are neutral non judgmental sellers, invariably, to be found somewhere in the commercial world.
Commerce rewards people for their success in commerce. Commerce rewards people for reasons that have nothing to do morality. Cruel people can gain great wealth and kind people can be poor.
Example of Commercial Indifference to Morality
Pacific Bell faced local competition a few years after the giant Bell Telephone monopoly (American Telephone and Telegraph Company) was broken up. New competitors began entering the West Coast telephone market.
Pacific Bell decided to energize their telephone salespeople in order to protect their home market, and in particular to protect Pacific Bell’s existing residential telephone customers. A simple sales incentive program was introduced that rewarded successful telephone sales people with new cars, fancy TV’s and vacation trips to Hawaii. The sales promotion program was effective, and the salespeople became very aggressive.
I became involved in this because I am an expert witness in legal matters relating to business practices. I was hired after an organization of California farm workers noticed that many of their migratory members, who didn’t speak English, had phone bills with minimum monthly charges of $35 when the phone bills should have shown a monthly $10 charge.
The farm workers’ organization phoned other minority organizations and found the same telephone-bill problem in the Chinese-American community, the Vietnamese community and several other minority communities that had large populations that didn’t speak English.
The minority organizations realized what was happening and went to a public interest law firm2 who hired me.
I learned that aggressive telephone salespeople were phoning existing residential telephone customers to sell upgrades to their phone service. When the salesperson found that the owner of the phone, on the other end of the line, didn’t speak English, the salesperson would illegally install the maximum number of telephone services on the line. As a consequence, a seventy-year-old Vietnamese widow, who could barely operate the phone in the first place, would find that she had call forwarding, caller ID, three-way calling and several more specialized services on her phone when her bill arrived.
The salespeople were correct in assuming that non-English speakers would have trouble realizing that their phone bills were excessive.
This fraud was not itself the result of moral indifference by Pacific Bell. Pacific Bell could have accepted complaints about their aggressive sales staff and changed their sales practices.
That is not what Pacific Bell did. The company denied there was a problem -- claiming the problem only existed in a few thousand cases.
The denial by Pacific Bell forced the public-interest law firm and its minority clients to do a survey to measure the extent of the problem. The number of non-English-speaking people who had been involuntarily signed up for $35 monthly phone bills when they should have had $10 bills turned out to be more than 700,000 families.
Over the many months it took to detect this fraud and the several years before it was finally heard by a judge, Pacific Bell collected tens of millions of dollars in extra fees.
Pacific Bell vigorously fought the case against them, lost, and reluctantly repaid some of the victims of the telephone fraud.
Pacific Bell and its parent company had a long history of good corporate behavior, derived from the moral authority of their founding leader, Theodore Vail. Long after Vail was gone, the company became like most other companies: indifferent to conventional public morality.
Summary
Technology and science succeed in the modern world because of their indifference to morality. Most people are comfortable with this indifference.
Commerce, which sells missiles to terrorists to fire at civilian airliners, drugs to drug addicts, irrelevant phone services to aged immigrant widows and sells slaves to whomever wants them, is indifferent to morality. We are not comfortable with this commercial moral indifference.
Commerce is indifferent to morality. The reality of this five-word statement reflects the way the world works. Our reaction to this five-word statement has much to do with the way each of us perceives the world. Those who believe that commerce is either moral or immoral, or that it should be moral, will nearly always be disappointed if they try to judge the world on that basis.
Chapter 2
My grandfather, Henry Phillips, was unable to continue his dental practice after the earthquake of ’06 destroyed downtown San Francisco and his office building burned to the ground. Dr. Phillips was a graduate of the Dental School of the University of California at Berkeley. An American dentist was in such great demand and so highly valued in the world that he was able to immediately move to Berlin to become the dentist to the Kaiser. He moved to Berlin and built a practice there.
New Commercial Values
Commerce thrives when specific social values are present: diversity, openness, meritocracy, markets, a technological affinity and decentralization. The presence of these values promotes commerce; their absence retards commerce.
Moral Indifference Can Be a Positive Value
If I walk into a drugstore to buy a pack of condoms I don't have to answer any questions from the salesperson; I don't have to explain my sexual plans.
The freedom to buy condoms without question was not the case when I was growing up. A few decades ago, condoms were kept behind the counter in drugstores. Buyers had to ask for them and at all times be prepared to answer intrusive questions about their sex lives. Young people were often refused the sale or lectured on the purchase. That was morality intruding on commerce, when I was growing up.
Sunday business was closed in nearly all of America due to Blue Laws up until the late 1960s. At the same time, public morality was openly hostile to the country’s gay population.
The tyranny of a pietistic rural majority governing urban lives over the past century was humiliating and in many ways disgraceful. Today, morally indifferent commerce has triumphed. Condoms are sold legally in the open and San Francisco’s Castro District (pictured on the cover), among other neighborhoods in the United States, caters to gay men. Commerce triumphed to sell condoms to whoever wanted them. Commerce triumphed to sell hardware, clothing and alcohol to gay men. Retail stores are now open even at night and on Sundays in the United States. These are all the triumphs of commerce over traditional morality.
The forces of morality have also been visible in the form of government enforcement of restrictions on commerce, such as the Federal encouragement of the monopoly of druggists on dispensing drugs and their practice of secrecy. But commerce continually struggles in its efforts to be unrestrained by traditional morality.
In most of America today, stores are allowed to open on Sundays and stay open twenty-four hours. Commerce never stopped violating the established Sunday sabbath; traders never respected the demand to stop business on the sabbath and the demand to stop carrying on business late at night. Commerce has won much of the public battle about retail store hours, but it will be a while before Americans can buy alcohol legally in bars at times that suit customers’ desires. Bars that allow smoking have been suppressed and are now a relic of the past in much of America. Commerce can be counted on to move smoking bars underground for a time and one day, to bring them back to the legal commercial realm.
The evidence for the moral indifference of commerce is even more convincing when we look at our history. The vigor of indifferent commerce is most evident when we look at the way illegal products and services entered our society from the outlaw sector to become mainstream commercial successes.
Docks and dockworkers have been the vehicle for forbidden commercial products to enter commerce for centuries. Tobacco came to us from the illegal smuggling of dockworkers in the 1600s. The same is true for coffee, which was smuggled by dockworkers into the urban surroundings of a variety of ports, throughout Europe. Tobacco and coffee were both illegal imports in most of Europe for more than a century in the 1600s and 1700s. When tobacco and coffee became legal, they often became government monopolies, and tobacco is still a government monopoly in some countries.
Erotic, pornographic and antireligious books have been sold clandestinely by underground commerce for centuries. Now, centuries later, we know that most important private European libraries had good collections of clandestine. The illegal underground was extensive even in the most repressive countries.
In the early 1700s, most countries imprisoned publishers and sellers of Baruch Spinoza’s philosophical works. Spinoza’s works were, nevertheless, recently found in numerous eighteenth century libraries in Europe. The same is true of Mark Twain’s widely circulated nineteenth century scatological tome.1
The triumph of commerce in connecting underground suppliers with willing buyers of alcohol has been a reality for several centuries. Most recently, 'rum runners' brought Americans their beloved illegal alcohol during the 1920s Prohibition Era. Commerce continues to bring us other illegal drugs: marijuana, cocaine, heroin, amphetamines, ecstasy and so on. No amount of government enforcement seems to stop commerce from delivering to people whatever they are willing to pay for.
Government pressure on large corporations has failed to deter commerce. In the mid 1960s, all the Arab oil states threatened to stop oil sales to any oil company or nation that sold oil to Israel. Royal Dutch Shell secretly sold oil to Israel. The actions of Shell were moral or immoral, depending on your side in international politics.
Today, commerce continues to thrive on moral indifference. Videotapes and portable video cameras became a global market thanks to the driving force of pornography. In most parts of the world, pornography has been considered immoral and has been illegal. Governments were fairly successful in suppressing pornography in the form of books and films. The 1980s saw the introduction of the new medium of home video recorders, whose images didn’t need to be developed in photo laboratories, and home video players. Home video existed completely outside the day-to-day retail world and created an instant medium for pornography that was outside the reach of government. This technology created an entirely new industry. Sales of pornographic videos rose in the United States from tens of millions of dollars to several billions in a ten-year period.2
The triumph of morally indifferent commerce is also evident in the history of the RCA video disc.
RCA introduced the video disc in the early 1970s. The video disc was a rapid failure because it lacked the two elements that made the videotape format successful five years later: The video disc could not be used to make amateur home pornography, and the only video discs available were those sold at retail and produced by RCA. RCA had a strict anti-porn standard for their video disc marketing. There was no medium for porn, no way for an underground to get started, and no basis for an above-ground commercial product to succeed.
The RCA video disc failed, and shortly afterwards the videotape succeeded thanks to the rapid appreciation of the market for pornography (outside the censorship of the government).
The continuing triumph of morally indifferent commerce through underground channels was also evident again for the Internet in its early days. The first Internet search engines found that the number-one or number-two word in searches during the explosive Internet growth years was sex. Searching for and finding sex sites was a significant factor in attracting early users to the Internet. For many of the early years, sex and pornography were the largest revenue producers for Internet businesses.
In the long, long historic ledger book of commerce, one entry stands out: interest on money. Shylocks, money lender, and a multitude of other terms of opprobrium have been applied to the morally indifferent actors in the theater of commerce. The history of the hostility and forceful suppression of interest on money is also the story of the triumph of the morally indifferent nature of commerce.
From the eleventh century until the eighteenth century, loans were also made to those who needed them despite official antagonism. Loans were usually made to the kings and aristocratic elites who most vigorously suppressed money lending. Much of the historic hostility to money lending remains in the world today, not just in Islam but wherever the interest rate is high because the risk is high. Americans still use the term “junk bonds” for high-risk bonds. Yet commerce still makes junk bonds available. “Loan sharks” make high-interest personal loans. Despite the opprobrium of the word sharks, high-interest, high-risk personal loans continue to be offered by commerce.
Morally indifferent commerce never gives up its function of satisfying customers; governments and moralists ultimately do give up.
Diversity over Homogeneity and Ethnic Cleansing
For the past four centuries, many Euro-Anglo cultures have been certain of the “natural” superiority of people with pink skin, light hair and light-colored eye pigmentation. This was not a moral ideology, just a regular everyday ideological certainty.
Commerce has had little or no truck with this view. Many parts of the “darker world” have successfully sold goods and services to the international commercial markets, and many “dark” ethnic groups have been successful in the world of commerce. The notable successes were the extensive commercial markets created by the overseas Chinese, the African coastal tribes (Fulani, Senegalese and Woloff) and the “dark Mediterranean” people, the Lebanese and the Indian Gujurati.
Later, the people formerly labeled “copycats” and “slave laborers,”3 the Japanese, created the world's second-largest economy.
Factories and industries of many types have moved to Mexico, Southeast Asia, and outback India to employ the formerly certified “lazy natives.”
Diversity is the word that describes the mingling of people with differing human physical, cultural and mental characteristics. Fortunately for everyone, morally indifferent commerce has no inherent bias against groups of people because of their cultures, their presumed moral inferiority, or their superficial anatomical characteristics.
Diversity is a positive virtue in the commercial world. Nearly all commerce began and thrived in urban areas such as the Phoenician capital of Tyre in 600 B.C.E., later in Alexandria, and then in Carthage, followed by Baghdad and Venice. All these cities were cosmopolitan centers where commerce flourished in a diverse population. Baghdad was such a thriving and diverse center in 600 C.E. that it had hundreds of Chinese doctors in residence.
Commerce has always thrived on diversity. The traditional urban diversity of religions, languages and ethnicities brought a wide range of skills, knowledge and information to a central urban site, which fertilized exchange. Diversity generated vital partnerships. Partnerships were formed based on unique sets of knowledge and skills of different partners. Traders needed the skills of craftspeople and both traders and craftspeople needed the skills of shippers.
Commerce thrived in diversity, and diversity required tolerance, so commerce became a vehicle for tolerance. The urban commercial centers of Tyre, Alexandria, Carthage, Baghdad and Venice were widely known as centers of tolerance. They had to be because commerce brought diverse people together. Adam Smith, the first and greatest theorist of commerce, in his 1756 book The Wealth of Nations, commented on the contrast between religions, which were intolerant and provoked most of the wars in Smith’s day, and commerce, which thrived on tolerance.
In trying to see the connections between commerce, diversity and tolerance, imagine you are a Jew or Muslim businesswoman from Alexandria in 750 C.E.; then imagine the difference for you doing business in the countryside of northwest Italy, a religiously and ethnically homogeneous region. You would have been safe in Alexandria, versus being in impossibly dangerous conditions in socially homogeneous northwest Italy.
Openness Versus Secrecy
Commerce has a strong bias toward openness. Commerce entices secrets away from official secret keepers. If commerce were a metaphoric container, it would be too porous to keep secrets.
Think about the secrecy problem in a commercial society. Imagine what it would be like if you were running a secret organization and had to cope with international spies. Most secret agencies are government run because a government agency has the authority to legally punish employees for not keeping secrets. The threats of a military tribunal, capital punishment and long prison terms are necessary to protect secrets, and governments are best at carrying out these threats.
If you run a spy organization, your enemies will using sex, blackmail and money to try to persuade your employees to counterspy. People can almost always be bought off. The enticements of commerce are great enemies of secrecy. Very few people want to defect to a foreign country, especially a non commercial country like the Soviet Union or Cuba. The same people will spy on their own country if they are offered enough money.
The direct enticements of money to buy secrets are usually the way that commerce displays its bias toward openness. Spies customarily buy secrets from each other
