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Democracy, Charity, and the Market
Published on Friday, April 2, 2004 by the Boston Globe
Democracy, Charity, and the Market
by George H. Rosen
 

LATELY NEARLY all my family's free time -- if "free time" is not an oxymoron -- has been swallowed up by fund-raising. The cause is a high-school trip overseas, planned for and anticipated nearly a year in advance. On the scale of good works, it ranks not as high, perhaps, as finding a cure for cancer or feeding the drought-stricken, but it is important to a group of hard-working teenagers who in preparation for the trip have been studying and preparing for this trip for a good part of their lives.

And raising money for it. The kids and their parents have been at it since September with the whole gamut of traditional ploys: raffles, dances, odd jobs, and bake sales. But the real focus of our effort, the pinnacle of the fund-raising process, is a charity auction.

It's a device dear to schools, hospitals, and museums -- and a proven moneymaker -- but it is also something of a good-hearted flimflam.

A local business contributes an item, let's say a clock radio, that sells for $70; it costs the retailer $50. Then, in an ideal fund-raising world, a lucky bidder pays $100 for it. There have thus been two direct contributions. The business owner has chipped in $50, the radio's wholesale cost, and the bidder has donated $30, the difference between what he bid and what he could have bought the radio for at the store. (The kids and parents, working to organize and manage the event, have made an indirect contribution through their unpaid labor.)

In a sense, the whole process is an exercise in enlightened irrationality. Everyone involved -- the donors, bidders, kids, and parents -- is linked in a conspiracy of generosity. Donors can feel more comfortable giving merchandise than if they were giving hard cash; bidders will pay more than they need to out of kindness and the sheer competitive fun of an auction night; kids and parents feel less embarrassed knocking on doors to rack up nifty donated items than they would if they were simply asking for money. And the school raises funds for a worthwhile cause.

Take away that charitable conspiracy, though -- that fuzzy-minded generosity -- and you don't have a charity auction, you just have eBay. It's a garden-variety free market: The sellers want to -- indeed, must -- produce or obtain their goods for as little as possible. The buyers, for their own economic well-being, seek to pay as little as they can get away with.

In a real-world free market, charity just makes you less competitive. Without the charity auction's irrational spirit of generosity, there is no margin for school trips, feeding the hungry, or curing cancer.

Not only does a free market lack any necessary connection with the goals of human charity; it masks the immediate, direct connection with our fellow men and women that might nourish generosity. The market is an efficient engine that spins while those who have real needs but no money to enter the marketplace stand outside and watch. To paraphrase St. Paul's words, without charity, the free marketplace, if not a tinkling cymbal, is merely a clanging cash register.

Which is why it seems passing strange that our free-market triumphalists, such as Dick Cheney, Paul Wolfowitz, and Tom DeLay, are so eager to pass along to the rest of the world the panacea of the marketplace, to spread "democracy and free markets" to every corner of the globe, even at the point of a bayonet. Their assumed vital connection between free markets and democracy is itself quite peculiar.

The essence of political democracy is the equality of humanity: one person, one vote. But the essence of the marketplace is the unequal power of money. In the market, the woman with one dollar has one vote, the billionaire has a billion votes, and the man outside the market, with no money in his pocket, has no vote at all.

It might well be argued that democracy has often, and not always successfully, arisen as a response to the abuse and human despair generated by so-called free markets. But whether or not a market economy is a cause of human suffering, it is a blunt fact that there has never been a market economy in the history of the world that did not blithely let people starve to death.

For societies like those in much of the world, racked with inequalities of wealth and tormented by hunger and ignorance and disease, the idea that a free marketplace, a more effective mechanism for clearing prices, will somehow by itself -- without charity, without real human love -- combat suffering is at once dangerous and foolish. The world is not a charity auction. A free market has no strategy for the absence of generosity and no answer for the lack of love.

George H. Rosen is a freelance writer.

Copyright 2004 Globe Newspaper Company.

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