The Common Good

Commenting on the many economic and social problems that American society now confronts, Newsweek columnist Robert J. Samuelson recently wrote: “We face a choice between a society where people accept modest sacrifices for a common good or a more contentious society where groups selfishly protect their own benefits.”

His is a widely held thesis. We live in a society that holds to be self-evident a palette of Manichean moral issues. Some will argue that this is a result of public education meeting social media, we do not know. Arguably, Michael Sandel is one of the most influential contemporary moral philosophers. Alas, as is often the case, many people who have not read his work are likely to misquote him. In his most popular book, Justice: What is the Right Thing to Do?, he sets forth that moral and religious principles are not just private matters, public policy should be informed by ethics as well. He is persuasive, lucid —he successfully summarizes Kant’s tortuous moral philosophy in about 40 pages that anybody may understand— and his lectures are delightful and available on YouTube included in the price of your Internet service.

Professor Sandel does not accept labels, but he is generally categorized as a communitarian even though he disavows John Rawls’s thesis. Rawls, the fountainhead of communitarianism, assumes the existence of a “veil of ignorance” which Sandel argues commits his thesis to a view of humanity as “unencumbered selves”. Sandel, rightly in our view, argues that we are encumbered to an extent that makes such a concept impossible. Therefore, the common good, as Rawls later came to argue, is not a metaphysical, but a political construct; implicitly, there is no common good but for that which emanates from political compromise. Thus is righteousness removed from public discourse, or rather, should be.

Just a few days ago, students seating for the Maths section of the university entrance exams in Madrid protested loudly at the extreme difficulty of the test. A cursory review of the questions does not reveal a particularly high degree of difficulty. All the questions covered material and problems that students who chose the Sciences track earlier in high school should have been able to solve from months of rote repetition. They were the kind of question that “would be on the test”. Surprisingly, not a single media mentioned the possibility that the class of 2021 might be ill prepared for these tests because of political decisions from the first half of 2020 that have dramatically transformed student evaluations since schools closed for months in March 2020. Whereas traditionally students were required to have a passing grade for each subject in order to go on to the next grade, a new law left this decision as well as the requirements to graduate in the hands of the school’s faculty. This change effectively lowered the bar and hundreds of thousands of students have received a degree but not the education to do well in further academic pursuits.

As many educators feared, remote education has not worked well for many students. This is a great example of most politicians’ utter ignorance regarding the living conditions of large swathes of their constituencies. Even though official statistics show that 99% of Spanish households with dependent children have Internet access, many of these households do not have a PC for each student in the household. More importantly, when neither mom nor dad have university degrees, or in many case even high school diplomas, their children are at an even greater disadvantage relative to other kids whose parents have university degrees., especially if educated remotely. Politicians also assume that teachers do not have children of their own who may also need the home computer for their own instruction. Hence, many teachers may not be able to teach all hours. If you live under the impression that school districts provided the IT infrastructure for their teachers, you should know that not even many Wall Street and City banks provided such tools to their employees. Many articles suggested early on that school closures would have dire costs for the lifelong earnings of those affected and we are beginning to see evidence of this problem.

The lockdown decision, which included closing schools but not public transportation, many factories, construction sites or tobacconists, was justified because it was in the best interest of the common good. The stated goal in most countries was to keep the public health system from collapsing. Indeed, high hospitalization rates were the most distinctive feature of the first wave of COVID-19 in the spring of 2020. Yet, we have seen higher infection rates in the second, third, or fourth waves in Spain, and hospitals have stayed very far from collapse. COVID-19 patients occupy a low single digit percentage of ICU beds currently in most regions while Madrid tops the charts at 20%. It has been a long time since anybody has mentioned respirators in the local media. Obviously, the case rate data for the first wave undercounted actual cases because of the lack of testing equipment. In any case, the fatality rates in succeeding waves have declined in spite of far more loose restrictions on mobility and social contact generally.

Government policy during the pandemic is a very good example of why the common good is a political construct. In fact, one may argue that the common good which, intrinsically a teleological argument, is divorced from the scientific process. Rather, it is a popularity contest. Following nearly three decades of waning influence of the public sector since the Thatcher/Reagan revolutions, the great financial crisis became the opportunity for a significant power grab by the public sector and elected officials. While most people enjoyed the public humiliation of bankers who made almost as much money for themselves as they then went on to lose for their banks and taxpayers, they were probably not aware that they were encouraging a trend. Politicians have since been unrelenting in their assault on private enterprise and our civil rights as individuals. Only yesterday, a court in Madrid indicted a few police officers that only a few weeks ago had been applauded by the Interior Minister of Spain for breaking and entering into a private home without a court order. Some worry, rightly, that the anthropogenic climate change hypothesis, currently a dogma of lay faith, will be the excuse to curtail further individual rights such as free movement, deciding the size of one’s home, or even our food choices.

The French Government has introduced a ban on short haul domestic flights because their CO2 footprint is much larger than that of trains. The legislators may not have taken into account that by eliminating these feeder flights into large airports they are further isolating people and businesses in smaller communities from the world at large. This policy further enlarges the divide between the haves and the have-nots in France, which a Government white paper concluded was determined by the chasm of incomes and education between residents of large metropolitan areas and those of ex-urban or rural areas. The neo-Enlightenment form of Government practiced by Macron was already literally under attack by the dispossessed hillbillies turned Gilets Jaunes who revolted against an increase in the taxes on diesel fuel. That tax increase was also well intended and informed by the environmental concerns of the urban professional classes and the increasingly large industry that depends on the environmentally friendly policies.

However, perhaps the Government of Spain is the furthest removed from the new realities of the post-pandemic world. In the election of November 2019, Mr Sanchez obtained the worst showing by a socialist candidate in nearly one hundred years. Luckily, the previously ascending Podemos also had a very disappointing electoral result. Instead of surpassing the socialists, Podemos lost a good number of MPs. They say politics makes for strange bedfellows; this was not the case in the aftermath of that ominous election. The Popular Front had already governed Spain in the 1930s. Sanchez immediately pivoted to form a social-communist government dependent on the votes of Catalan pro-independence parties and Basque pro-independence and phyllo-terrorist parties, notwithstanding Sanchez’s electoral promise that he would never govern with either party’s support. Since then, the common good in Spain has been redefined and includes many of the political priorities of these fringe political groups, none more devastating to most Spanish families that the weakening of the property rights real estate owners through a combination of rent controls, encouraging squatters to take possession of “empty” dwellings, or limiting the enforceability of evictions. As we have discussed often before, many of these positions are for domestic consumption when in reality Spain’s charges at the Eurogroup are setting a neo-liberal agenda in the background.

Yet, PM Sanchez has managed to stage a Jamboree in Barcelona under the auspices of the 38th Annual Meeting of Economists in which frenzied business people have exalted him. Sanchez dominates the stage in front of a business community enthralled by the myriad opportunities for graft that may arise from the €180 billion in EU funds that some believe Sanchez will bestow on sycophantic followers at his pleasure. This manna from Brussels buys the silence of the mighty over the very controversial presidential pardon that Sanchez will grant a few Catalan politicians who are serving prison sentences on convictions for secession. Sanchez has decided their questionable release, for these prisoners have shown no remorse nor atoned for their felonies. On the contrary, they promise to try again as soon as possible. Yet, Sanchez needs the Catalan pro-independence party to keep his government afloat and no price is too high to pay. A man who is on record saying that he would make pardons illegal is today a big fan.

Yet, the business audience in attendance is enthralled. For these people, it is irrelevant that Spanish taxpayers are largely funding the €180 billion EU Next Generation funds. The maths are fairly straightforward, Spain guarantees its share of the soon to be issued new EU debt, this is approximately €72 billion out of €800 billion. Another €70 billion of EU funds come in the form of soft loans. Soft they may be, but nonetheless they are loans that will have to be repaid. (To think about this problem it helps to think about how much money would you borrow at 0% for 30 years). In addition, Spain will lose €3 billion per year because of new Common Agricultural Policy funds. When all is said and done, the net grants from the EU do not amount to a pile of beans for taxpayers. However, this is not important, what is important is that many in the audience believe that Sanchez holds the keys to a second period of EU funded bonanza. They are wrong and most will be disappointed when they learn that their business plan will be reviewed by grey eurocrats who may decide it does not conform to the views of the auditors in Brussels.

The picture of the week though is the top executives of three of the largest companies in the Ibex seated on the dais of this gathering discussing how the economic recovery would be even faster than predictions have it. These gurus expect GDP to grow 8.8% in 2022. This rate sounds impressive but is not much relief compared to 2020’s 10.8% decline. Spain’s GDP will not reach the 2019 nominal figure until 2023. This gathering of sycophantic courtiers marks a low point in the declining fortunes of Spain as a developed economy, it may mark the end of the post Franco era when Spaniards aspired to take their rightful place among the developed economies of the West. None of the heavy weights on the dais is the founders of the company she represents; none of them has much skin in the game either. Further, their business models are outdated and unprepared for the software centric technology revolution underway that the pandemic has only accelerated. Software centric companies, also known as fintech, are threatening banking. Telecom operators have a very low return on capital business. Apparel retailers need to address the online channel threat as well as more environmentally aware young customers, who may not patronize disposable clothes manufacturers for long.

Yet, in spite of the opinion of a vast majority of Spaniards who are dead set against the pardons or the negotiation of further devolution of powers to Catalonia, the best interest of taxpayers, and the government’s weak mandate (Sanchez and Podemos keep getting whipped in regional elections), this government will continue to define what constitutes the common good for Spaniards with the support of a business community which has seldom been more dependent on handouts for their survival. There will soon be more implorations to sacrifice individual rights at the altar of the common good. Let us hope that this time around there will more debate and less meek conformity. Remember that the common good is not a moral principle, rather it is a political compromise and you, as a citizen, should have a role in defining it.