Capitalism and Tolerance

Back in 2000, when I started my first real job, I noticed when signing up for benefits that my employer offered benefits for same-sex domestic partners equivalent to those offered to spouses. At the time the significance escaped me, but in retrospect I see this as a testament to the power of the profit motive to foster tolerance. At a time when voters in the most left-leaning states in the country were unwilling to vote in favor of legal recognition of same-sex marriages, a major corporation did so because that's what it had to do to attract talented gay engineers. In this, as in most everything, it was money-grubbing capitalists, not voters, who were on the cutting edge of tolerance.

On a similar note, about twenty years ago, I remember hearing my grandmother describing her response to a customer who'd badmouthed a lesbian couple who frequented the bar my parents and grandparents co-owned: "Their money's as good as yours." A cliché, yes, but an uplifting one. It reminds us that the merchant pays a price for intolerance.

It's easy to indulge one's petty prejudices in the voting booth, where the price for doing so is negligible. But every time a merchant turns away a customer, every time an employer turns away a candidate or loses him to a more tolerant competitor, he's reminded of what his bigotry is costing him.

If I were a member of an unpopular minority*, I'd want as many decisions about my civil rights in the hands of money-grubbing capitalists as possible. There is no political equivalent of "their money's as good as yours," and some things are just too important to be left up to the political process.

*Actually, as an atheist, I guess I am.

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Turn-about leads to equally fair play?

I remember hearing my grandmother describing her response to a customer who'd badmouthed a lesbian couple who frequented the bar my parents and grandparents co-owned: "Their money's as good as yours."

And if it had been the bad-mouthing patron who was the frequent customer rather than the lesbian couple, what result would capitalism have rendered?

Do the experiment

And if it had been the bad-mouthing patron who was the frequent customer rather than the lesbian couple, what result would capitalism have rendered?

Why don't you try the experiment. What business do you frequent? Go into that business and start badmouthing some random customer. See whether the proprietor makes a remark implying that you should shut up.

I think the complainer was a

I think the complainer was a regular customer. It wasn't a choice between kicking one or the other out (I'm pretty sure he had been complaining about the lesbians when they weren't there, not openly confronting them).

Of course, it's easy to cook up some scenario in which it pays for businessmen to discriminate due to pressure from their other customers. If half of your customers are threatening to boycott if you don't kick out 10% of your customers or fire 10% of your staff, then yeah, you have an incentive to discriminate.

But if a minority's that unpopular, think how seriously screwed they are when it comes to the decisions that are made in the voting booth. The profit motive isn't some kind of magical fairy dust that makes everyone love everyone else. But it does push people in the general direction of tolerance. Sometimes a minority is so unpopular that it's bound to be shunned no matter what, but as a rule, profit-seeking firms are significantly more tolerant than the median voter.

On "tolerance"

[I]t's easy to cook up some scenario in which it pays for businessmen to discriminate due to pressure from their other customers. If half of your customers are threatening to boycott if you don't kick out 10% of your customers or fire 10% of your staff, then yeah, you have an incentive to discriminate.

But if a minority's that unpopular, think how seriously screwed they are when it comes to the decisions that are made in the voting booth. The profit motive isn't some kind of magical fairy dust that makes everyone love everyone else. But it does push people in the general direction of tolerance. Sometimes a minority is so unpopular that it's bound to be shunned no matter what, but as a rule, profit-seeking firms are significantly more tolerant than the median voter.

A fair point. Indeed, a crucial point to the whole underpinnings of libertarianism: What concepts of autonomy should we defend via state coercion? The oppression of private discrimination goes hand-in-hand with the autonomy of private actors to discriminate; a law designed to restrict private discrimination is typically a law that impinges on the autonomy of discriminators.

Yes, profit-maximizers tend to be “tolerant” – that is, they decline to reinforce group norms when it is in their own self-interest to do otherwise. The store owners who declines to maintain group norms regarding racism and instead agrees to serve blacks (provided that doing so won’t cost him more sales from whites) is tolerant of blacks; why provoke needless conflict with the black customer who is standing in front of you?

The teacher who declines to maintain group norms of excellence and instead gives As to all students is tolerant of poor performance; why provoke needless conflict with the student who is standing in front of you?

The manager who is lax with his subordinates even at the expense of shareholder interests is tolerant of mediocrity; why provoke needless conflict with the employee standing in front of you?

The cop who takes a bribe to let a criminal go is tolerant of crime; why provoke needless conflict with the criminal standing in front of you?

The firm that dumps pollution into a stream rather than take expensive measures to manage it is tolerant of pollution; why provoke needless conflict with shareholders?

I understand ethics/morals/principles to refer to propositions that people uphold for the good of society even when it might be better for the individual to not uphold them, at least in the short run. “Profit-maximizers,” as discussed above, maximize profit by refraining from squandering resources on ethics/morals/principles. Now, to the extent that you don’t like another person’s ethics/morals/principles, that’s all for the good. But there’s a pretty obvious flip side to that coin.

In contrast, some people uphold tolerance not as a tool for profit-maximization, but as a goal in itself. Lyndon Johnson pushed through the Civil Rights Act of 1964 even though it was widely acknowledged to be electoral suicide both for the Democratic Party and for Johnson personally. Whatever you may think about that legislation, it was clearly not motivated by the kinds of short-term profit-maximization discussed above.

The perils of shorthand

The teacher who declines to maintain group norms of excellence and instead gives As to all students is tolerant of poor performance; why provoke needless conflict with the student who is standing in front of you?

No, that's not tolerance - in the sense meant. "Tolerance" in context is shorthand for something which would take longer to describe.

Similarly, "discrimination" in the negative social sense is shorthand for something which would take longer to describe.

A capitalist order encourages people to serve the customer. A teacher in a private school who tolerates poor performance will be fired quickly, lest she take the school down with her.

Is shorthand really the issue here?

The teacher who declines to maintain group norms of excellence and instead gives As to all students is tolerant of poor performance; why provoke needless conflict with the student who is standing in front of you?

No, that's not tolerance - in the sense meant. "Tolerance" in context is shorthand for something which would take longer to describe.

Similarly, "discrimination" in the negative social sense is shorthand for something which would take longer to describe.

A capitalist order encourages people to serve the customer. A teacher in a private school who tolerates poor performance will be fired quickly, lest she take the school down with her.

Right. Cuz at good private colleges we find no evidence of grade inflation. I’m afraid I’m gonna need to see those longer descriptions.

Yes, a teacher that tolerates poor performance might well be fired for imposing long-term costs on society for her short-term private gain – that is, assuming management could identify the problem and find other teachers who would not be subject to the same temptations to cheat. Similarly, a store owner that declined to uphold a society’s norms of racism for his private financial gain would be driven out of business – that is, assuming members of society could identify the non-conformity and retaliate effectively.

In other words, if people who care about a norm are effective at enforcing that norm, then teachers and store owners would learn that flouting that norm is not a means to maximize profit, and we’d expect stronger adherence to that norm – whether it be a norm for rigorous grading or racism.

Too good to pass up....

One last example: Rick in Casablanca. At the beginning of the movie he’s appears to be a tolerant profit-maximizer. “I stick my neck out for nobody.” Indeed, he’s a noteworthy American precisely because he’s so tolerant in an era in which Americans had adopted a pronounced intolerance for Nazis. By the end of the film Rick also adopts this intolerance, and acts on it even at great cost to himself.

Good? Bad? Depends on your perspective.

Stop me before I post again!

Or consider the Ultimatum Game. I tell you that I’ve offered some stranger $100 with the only condition that he decide how much of that money to share with you, and that you’ll have the opportunity to accept the division (and take the share offered) or veto it (and both sides get nothing). The stranger offers to share $10 with you. What do you do?

Evidence demonstrates that people overwhelmingly reject offers of less than 45%. And one understanding of this outcome is that people value a norm of equity and reciprocity. In other words, the $10 is not free money. In order to take that $10 people realize that they’d need to reward someone who acted in a manner contrary to their values. People value a norm of equity and reciprocity so highly that they're willing to incur a cost in order to punish violators.

In contrast, I’d expect a “tolerant profit-maximizer” – someone who was not willing to incur a cost to vindicate the goals of the larger group – would take the $10.

given i dont own a business

given i dont own a business, i generally only care if someone is getting hurt, as the elders of my youth would say, they can go to hell their own way... basically, if no crime is being committed, no one is being hurt or coerced, i could care less what people do to themselves voluntarily (even if the problem is that they may be too stupid to know better - which i am applying to things like heroin, not who you have sex with in your bedroom)