Truth and Moral Capitalism

I just read a clever little human-interest story which brought me up short.

The story was about Peter Barton Hutt, of whom I had never heard.  He apparently introduced to the American consumer systemic learning of the “truth” about what they bought to eat – the mandated nutrition labels that sellers of food products must put on their packaging to inform customers of what is in the food they are buying.

Five decades ago, Hutt wrote the rules on disclosure of ingredients for the U.S. Food and Drug Administration.  Disclosures of ingredients have since appeared on billions and billions of packages in legible typeface.

But consider: how can a moral capitalism ever work if there is no truth?

Running capitalism on “your” truth or “my” truth just won’t cut it.  Such a system of illusions and delusions, of random guestimates, will never gain traction among human persons.  Who will trust whom about what something is or is not?

If there is not truth, how can any good, service or company be given a sound and sensible valuation?  Governments impose a requirement for telling the truth on those who issue securities.  Donald Trump is in big legal trouble for allegedly not telling the truth about the value of his ownership interests.  The courts impose liability on those who lie, cheat, deceive and misinform and so harm others.

Markets need flows of trusting buyers to survive from moment to moment.  Unquestioned reliance on the probity and honesty of sellers makes markets possible.  Caveat emptor – “buyer beware” – is an age-old caution putting a drag on market dynamics.  Not every seller tells all the truth all the time.

Alan Greenspan’s quip about the dangers of “irrational exuberance” – a form of truthlessness – has caused many a market bubble to form and then pop, leaving buyers sorry and angry over their unexpected losses.

If truth drives markets to produce the “wealth of nations,” as Adam Smith observed, who then can we find to always be truthful and keep our markets working for the best?

Remembering John Brandl: A Moral Politician

A friend of mine, the late John Brandl, a former Minnesota legislator and dean of the Humphrey School of Public Affairs, demonstrated in his life and his career in politics how to incorporate moral ideals with self-interest and differences in religion to create a common good for citizens.

John demonstrated, with tact and grace and through personal perseverance, that we can collaborate in good faith with others who are not our intellectual or cultural clones to instantiate in our lives a common good.

We have included in a special issue of Pegasus some essays written in honor of John’s example.

I am reminded, when thinking about John and others like him who I have met around our world, that it is individuals who create moral outcomes.  Such happenings are not of natural design.  Nor do they come about by accident or from thoughtless, uncaring, selfishness.  They demand human agency and invention.

Principles – for moral capitalism, moral government and moral society – can easily and elegantly be proposed, but only individuals can bring them as a living presence into the reality that philosopher Jurgen Habermas called “facticity.”

Therefore, I hope I am not being overly provincial in bringing to your attention the example of an American politician from one of our 50 states.

An Historic Contribution to Interfaith Understanding within the Family of Abrahamic Religions

Last Thursday, at the Pontifical Institute for the Study of Arabic and Islam in Rome, our fellows, Professor Ibrahim Zein and Dean Recep Senturk, both of the College of Islamic Studies, Hamad Bin Khalifa University, gave presentations at the Georgetown Lecture on Contemporary Islam 2024.

John Borelli, special assistant for Catholic identity and dialogue to the president of Georgetown University, moderated the program.

Professor Ibrahim Zein and Ahmed El-Wakil have authored a book, The Covenants of the Prophet Muhammad, on the historical giving by the Prophet Muhammad of covenants to respect and protect Christians and Muslims.

For his part in the Georgetown lecture, Professor Zein affirmed, after close study of multiple existing recensions of covenants given personally by the Prophet, that these documents are not forgeries.  His conclusion is that we have accurate texts of covenants given by the Prophet Muhammad from which we can learn more about his religious principles, his values and his engagement with non-Muslims “under the wing of mercy,” as he said in several of his covenants.

In this connection, it is most important to note that the Qur’an opens with acknowledgement of Allah’s mercy and compassion:

In the name of God, the Most Compassionate, Most Merciful: Praise be to God, Lord of the worlds, the Most Compassionate, Most Merciful.

Dean Recep then spoke to the contemporary application of the values enshrined in Prophet Muhammad’s covenants with Christians and Jews (and also with Zoroastrians).  Dean Recep places the Prophet’s use of covenant within the moral recognition of a universal humanity arising from God’s creation of Adam and all those who descended from him.  In Arabic, this universalism of the inherent possibility of preciousness to be associated with all human persons is called Adamiyyah. (Please refer to Dean Recep’s article, “Islamic Law and the Children of Adam”.)

The common conclusion of the two presentations is that at the time of the Prophet, Islam was a more welcoming and tolerant religion than is conventionally accepted these days by many, including many Muslims.

At the conclusion of the Q&A segment of the lecture, our chairman emeritus, Lord Daniel Brennan, stated his view that the lecture had been “historic” in opening new vistas for mutual respect and inter-religious collaboration and mutuality among the faithful followers of the three Abrahamic religions.

To decide for yourself how significant it is for us today to learn about the covenants of the Prophet Muhammad and their affirmation of tolerance in religion, please do read the book by Professor Ibrahim Zein and Ahmed El-Wakil linked above.

I would also like to thank Silvano Cardinal Tomasi for his leadership and guidance these past 5 years, as the Caux Round Table has provided its good offices as best as possible to gather scholarly opinion about the provenance, historicity and textual authenticity of the Prophet’s covenants.

I write this on the day of Pentecost, a moment of remembrance for Christians of the coming of the Holy Spirit into our world.  May that touch of higher justice inspire all of us to think again of just who is our neighbor and what is due to them from us.

Caux Round Table Proposal for Reconciliation Among Those Faithful to the Abrahamic Religions

I write to you from Rome where yesterday, our chairman emeritus and myself, with our Caux Round Table fellows, Silvano Cardinal Tomasi, John Dalla Costa, Dean Recep Senturk and Professor Ibrahim Zein, made public a press release and statement on the use of covenants for reconciliation among the faithful within the family of the Abrahamic religions.

Yesterday was most significant for releasing a statement on seeking peace in the Holy Land.  It was the anniversary of the 1948 Nakba, a devastating experience for many Palestinians, leading to decades of alienation and conflict between Palestinians and the Jews of Israel.

The world has watched, over many decades, failure after failure to heal the wounds of fear and conflict in the Holy Land and bring about a just and lasting reconciliation among parties in conflict.

Perhaps, therefore, a new approach is needed.  Neither war, nor sovereign claims to territory, nor conferences and diplomatic interventions, have been successful.

Finding a basis for mutual respect and appreciation of the other is needed, as Pope Francis proposed in his last encyclical, Fratelli Tutti.  In this context, the precedent of the Prophet Muhammad giving covenants for himself and his followers to keep until the end of time to respect and protect Christians and Jews becomes of great significance.

Orn Bodvarsson Appointed Fellow

It is my honor to report that Orn Bodvarsson has been appointed a fellow of the Caux Round Table.

Professor Bodvarsson has an enviable record of accomplishment in teaching and thinking about capitalism, business, finance and public governance.  He has been graciously supportive of our work in past years and I look forward to his greater involvement in our delivering thought leadership and a foundational vision of justice.

Orn has a Ph.D. in economics from Simon Fraser University, Vancouver, Canada, with research in labor economics, applied microeconomics, economics of information and financial economics. He received his B.S. in economics, with honors, from Oregon State University in 1979 and his M.S. in agricultural and resource economics, also from Oregon State University, in 1982.

Orn is currently the dean of the Atkinson Graduate School of Management and professor of economics at Willamette University in Salem, Oregon.

Previously, he was dean of the Gore School of Business and professor of economics at Westminster University in Salt Lake City, Utah, dean of the College of Social Sciences and Interdisciplinary Studies and professor of economics at California State University, Sacramento and founding dean of the School of Public Affairs and professor of economics at St. Cloud State University in St. Cloud, Minnesota.

Orn has published The Economics of Immigration: Theory and Policy, 2nd edition (with Hendrik F. Van den Berg), Heidelberg, Germany: Springer-Verlag (2013) and numerous articles for peer reviewed journals.

He will bring to our discussions a wise humanity, an open mind and thoughtful attention to detail.

I am delighted to have his guidance and counsel readily available.

Caux Round Table Book Club for 2024: Books and Dates

I have been discussing with our staff and some fellows and interested participants the value to our network of starting a book discussion club in 2024.

Since the formidable works of Adam Smith and Karl Marx, our understanding of capitalism and its alternatives – and of economics, sociology, psychology, politics – has been formed by books.  Those who don’t (can’t) read are at a great loss for not having many contextualizing frames of meaning and narratives with which to think about and rationally act in our world.  They know little about how we got here, what is shaping our lives and where we might go.

Every week or so, it seems to me, there appears one or more new books with relevant contributions to our assessments of the past, present and future.  Too many for me to keep track of.

As we learn from books, we also learn from each other.

We will meet once a quarter by Zoom to discuss a book which has been selected for us to read.

Somewhat haphazardly, we propose these four recently published books:

Power and Progress: Our Thousand-Year Struggle OverTechnology and Prosperityby Daron Acemoglu and Simon Johnson
Why Empires Fall: Rome, America and the Future of the Westby Peter Heather and John Rapley
The Civic Bargain: How Democracy Survivesby Brook Manville and Josiah Ober
Mandeville’s Fable: Pride, Hypocrisy and Sociabilityby Robin Douglass

The times and dates of the discussions are:

-9:00 am (CST) Thursday, February 15 – Power and Progress
-9:00 am (CDT) Wednesday, May 15 – Why Empires Fall
9:00 am (CDT) Thursday, August 15 – The Civic Bargain
9:00 am (CST) Friday, November 15 – Mandeville’s Fable

We will send a notice of meeting and reminders before each date so that you may register to participate.

If the discussions prove fruitful, we can consider adding books and discussion sessions.

I hope this initiative meets with your approval and that you might want to participate.

Please let me know any thoughts you might have on making this initiative as rewarding as possible for participants.

Cultivating a Better Understanding of AI: Video

Back on April 2, our fellow, Michael Wright, CEO of Intercepting Horizons, provided us with a general overview of AI, which you can view here.

Michael is a values-driven leader and innovator who is passionate about leveraging technological convergences to shape future business landscapes.

He is the author of two books, The Exponential Era and The New Business Normal, both on management and technology.

Many thanks to Loren Swanson, one of our regular participants, for recording it.

American Education In-person Round Table – Thursday, May 23

Our colleague, Michael Hartoonian, keeps us thinking about how a society can meet expectations of promoting moral capitalism and benefiting from moral government if citizens are not well educated.

America is in crisis – mostly due to elite failure in government and culture.  Our slogan, to borrow from students in our elite educational institutions, might be: “From the Atlantic to the Pacific – America is unhappy.”  The crisis has enveloped all our institutions of education, from pre-K to post graduate.  Failure of educational institutions has aggravated our dis-ease.

One set of data on this is the following chart:

Michael has recently drafted a statement on public education.  I have sent it to the presidents of colleges and universities in Minnesota with a request that they work with us on a Minnesota statement of ethical principles for higher education.  I attach a copy for your review.

Please join at noon on Thursday, May 23 at Landmark Center for an in-person round table over lunch to discuss what needs to be done to address what is both a consequence and a cause of our national anxiety and consequent low expectations of ourselves and our leaders.

Registration and lunch will begin at 11:30 am.

Cost to attend is $20.

Lunch will be provided by Afro Deli.

To register, please email

April Pegasus Now Available!

Here’s the April issue of Pegasus.

In this edition, we include three articles.

The first, by yours truly, is about equity.  What is it?  What’s its history?  Do people who speak of it actually know what they’re talking about?

Secondly, we include a piece by Michael Hartoonian on the causes, propositions and policy recommendations for atrophying societies.

Lastly, we have a guest article by a colleague at the Sasin School of Management on boosting Western capitalism with Eastern wisdom.

As usual, I would be most interested in your thoughts and feedback.

It’s the Values, Stupid!

Bad actors make a mess of capitalism.  Deepfake creators are taking advantage of AI capabilities available in the market to scam companies.

In particular, AI programs can now imitate actual voice patterns of individuals to create phony, over the phone instructions to companies to do something for a supposed customer.

Banks and financial service companies are among the first to be targeted.  Companies providing voice activated access to personal accounts could expose depositors to theft.

OpenAI has showcased technology that can re-create a human voice from a 15-second audio clip.  But, thoughtfully, OpenAI said it would not put the technology on the market until it has more information on potential misuse.

Bad actors could also use AI to generate fake driver’s licenses to set up online accounts.

Could it be that we really do need “morals” in capitalism to protect the common good, that self-interested, short-term money profiteering is an unreliable road leading to increasing the wealth of nations?