While looking for a new source for material to review, I visited an old web haunt where I use to post comments until I was blocked. Later on, that blog site eliminated the ability to comment on their articles. This has been a common occurrence in religiously conservative Christian websites. Some of these sites include Denny Burke's blog and The Gospel Coalition website. The article being reviewed today was posted the Acton blog.
The article being reviewed was written by Joseph Sundee (click here for info) and is about what is called a win-win denial because of the belief that business transactions rely on a zero-sum game (click here for the article). We should note here that the Acton Institute, which hosts the Acton blog articles, more-less promotes free-market economic views. At the same time, the people at the Acton Institute claim that such an economic view is supported by Christianity.
In this article, Sundee wants to challenge our natural tendency to think of businesses transactions as engaging in zero-sum games where one group's gain is another group's loss. Sundee cites a study from the American Psychological Association (APA) and talks about the belief that the most successful for-profit ventures are 'less socially responsible.' Sundee claims that the opposite is true without any showing any documentation.
The study that Sundee uses asks whether both buyers and sellers were better off after voluntary exchanges. The tendency was to think that sellers benefited more than buyers. The belief tendency was attributed to limiting the position of a party solely to the monetary value rather than including the value of the goods or services purchased.
The name given to the view that can only see zero-sum games in business exchanges was called 'win-win denial' by the authors of the study Sundee cites. The study came from the American Psychological Association (APA). Sundee's point is that this win-win denial unfortunately interferes with social trust in our businesses and such. That this win-win denial must be countered to expand our trust in our economic institutions.
In the end, Sundee calls the belief in the zero-sum game a fallacy and I think he does that without realizing one of the definitions of that word. A fallacy isn't necessarily advancing something that is false. A fallacy can be the misleading marketing of the logic involved to prove a claim. Here, a claim that rests on a fallacy could be true, but one cannot logically conclude that the claim is true because of the logical problems that exist in the argument. If Sundee is not employing that definition of the word 'fallacy,' then he is claiming that there are no zero-sum game instances in our economic system.
What we should note is the kind of black-white thinking involved in Sundee's framing of the issue of the zero-sum game. For example, the number of participants included in determining whether a business exchange was a win-win or a zero-sum game are reduced to two: the buyer and the seller. Later, Sundee mentions other two-party relationships such as employee-employer. In the buyer-seller interaction, participants and other stakeholders who are excluded when determining whether an interaction is a win-win include the workers who produced the goods, the communities they live in, and/or the environment. And what else is excluded is the notion that we are working with the finite resources of all of the parties involved. After all, when finite resources are involved, one person's gain can become another person's loss.
And so the value of any business transaction is not necessarily good or bad for each person involved, but it is mixed. Yes, a buyer will most likely benefit from the goods or services that they purchase, but their purchase could reduce their ability to voluntarily purchase something else in present or future desired exchanges. In addition, the deal used to make and exchange beneficial to both the buyer and seller may come at the expense of either the workers who produced what is purchased, the environment, or other stakeholders. This ignoring of the effects that a purchase can have on those other stakeholders and the economic system itself can be called ignoring externalities.
When one considers that our current form of capitalism, neoliberalism, which is today's implementation of a free market economy, has for decades produced growing disparities in wealth and income between races and between economic classes, has contributed to a growing political disparity between the economic classes (click here), and has had greater negative impacts on the environment, one does not need economic studies to show that we have both win-win scenarios and zero-sum games coexisting in our economy.
If all Sundee was saying is that we cannot assume that any given transaction is a zero-sum game, then I can agree with him. We should not assume that any purchase is a zero-sum game, otherwise we could stare good opportunities in the face without benefiting from them. But if he is saying that there are no zero-sum games at all either in any individual business purchase or business venture or in our economic system, I'm afraid that there are plainly observable facts on the ground contradict that notion. And because not all opportunities are either win-win scenarios or zero-sum games, we have to look at each purchase or business transaction on a case by case basis. The same could be said of our economic system. We can't assume that our current economic system, neoliberal capitalism, is a a win-win for us as a nation or for the parts of the world that employ it.
Furthermore, if we reduce the results to just win or loss, we will be oversimplifying what is going on in any purchase or transaction. Many of the results we see from business being conducted in our nation's economy either on the individual level or local, regional, and national levels have mixed results. And whether there is a net gain from how business is conducted can only be clearly seen later on. Thus looking at each business transaction as either a win or a loss does not encourage or enable us to thoroughly examine the final results of doing business.
So yes, we should not assume that all business transactions are zero-sum games. But neither can we assume that those business transactions provide win-win scenarios either. Business and economics are far more complicated than what Sundee seems to given them credit for.
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