The Reckoning · Season 1

The Reckoning: Lesson Six

In this lesson, you’ll learn:

  • The cause and effect of vice or virtue in the free market
  • The definition of leadership in business
  • Why the State grows when ethics are not maintained in business

Read the Transcript

Hello and welcome to The Reckoning, a series uncovering the ultimate battle for freedom between socialism and virtue in business.  This is Session VI of VIII.  If you are joining us for the first time, I encourage you to watch the other sessions to gain the background and foundation to better understand how we arrived here and how your heroic role as a business leader will be the difference in this battle.


In our last session, we explored the Church’s teaching on why the absence of our Catholic and Christian faith in business spawned socialist ideologies, a lagging indicator of injustice, and the solution offered by the Church: the infusion of social justice and the sentiment of Christian love into the socio-economic order.  We finished the session with a discussion of the cardinal and theological virtues and how critical they are in the practice of Christian business leaders to “will the good of the other” (how St. Thomas Aquinas defined love) in business.


In Session V, we quoted Catholic author Michael Novak from his book, Business as a Calling, where he identified business as the largest institution in civil society, and attributed societal morality, good or bad, to the moral character of business leaders.  I reiterate this now, because when business leaders don’t concern themselves with the protection of human dignity, the pursuit of the common, practicing the virtue of justice in and through business, we invite government intervention.  Remember, ensuring these things happen IS the role of the State, but the Church instructs its people that the primary responsibility for these rests NOT in the State!  They are yours and mine as business leaders to own.


Let’s model this thinking out to get a better understanding of the causes and effects here.  In the US, we are fortunate to be able to do business is what is a significantly free market, where the rule of law and rights to ownership of private property are so native that we rarely even think about them.  In a free market, we can create goods and services that create value for society and for customers.  If we do this well, we generate significant wealth and benefits within our business for ourselves and for the others who participate in our business, including customers, suppliers, our employees, and our communities.


We quickly arrive at the critical decision, though, what do we do with this wealth?  As a business leader, do we choose to practice virtue (remember our discussion of prudence, justice, temperance, and courage in the last session, perfected by faith, hope, and love), or do we opt for vice, in the absence of virtue.  Let’s begin with what happens when the latter, vice, is chosen.


When we as business leaders chose vice over virtue, we choose not to pursue a true good, we are unjust, we are materialistic, and we fear where courage is needed.  We lack in our service to the dignity of those within the orbit of our business, especially our employees, the common good of all is left wanting, and our resources and communities are plundered, not blessed.  While sounding a bit extreme, some order of magnitude of each of these exists when virtue is not practiced in business. This is the CAUSE.


What’s the effect?  The constituents of the business turn toward the State or government and the government intervenes.


Though the Church teaches that any government intervention should only be as long as is required to remedy the circumstance, our experiences and observations tell us that it is very rare, that once the government intervenes, they leave or stop a program.  As an indirect employer with no source of revenue other than taxation of its citizens and businesses, they tax those generating value and businesses and people invest less, share less, create less value, and generate less wealth to be distributed, and so on.  This is the EFFECT caused by the choice to opt for the absence of virtue or vice. Because this government substitution is attempting to solve problems of injustice, people begin to turn their heads where they have the hope of an answer.


Let’s model out the choice where business leaders, heroes in this battle, choose virtue over vice.  Something amazing happens!  The same stream of free market opportunities, value creation, and wealth generation happens.  Only this time, the business leader is both conscious of and concerned with the true good; that of justice, of temperance and the required courage to persist.  He or she seeks to dignify those within the orbit of their business, seeks the good of all and the health of their community, and distributes wealth justly among the business’ stakeholders, including the shareholders.  This is also a CAUSE.


What’s the effect here?  To clearly understand the effect, we must first understand a bit about leadership at its core.  At its core, leadership is the art of optimizing cooperation.  This definition has Biblical roots in the Old Testament book of Ecclesiastes.  Ecclesiastes 4:9 says this, “Two are better than one because they have a good return for their work.”  Some translations say, “good reward for their toil.”  Isn’t this what business wealth generation looks like . . . a good return?  Notice the cause and effect here.  A “good return” happens where two work together or cooperate in the work at hand.  This is the essence of effective leadership.


We need only to look at our own experiences and preferences to assess the validity of this assertion.  If we liken “working together” with the word “cooperation,” are we more likely to “cooperate” if our leader chooses vice or virtue in this model?  I know I’d follow one who was wise, just, temperate, and courageous over one who was foolish, unjust, materialistic, and fearful.  I trust most of you would, too.  And when we follow and commit more fully and willingly to the work at hand, we create competitive advantage for the business, which creates more value, which generates more wealth, which demands more virtue.  This is the EFFECT caused by the choice to practice virtue over vice.


Do you see the simplicity on the other side of complexity here, for which Oliver Wendell Holmes suggests he would give his life?!  At its core, leadership is simple; the art of optimizing cooperation.  Overcoming the entrenched dominant ideology, placing oneself in service of others for the purpose of achieving something bigger than any one person, and making amends to those who may have been exposed to and subjected to a contrary practice . . . well, herein lies the complexity.  The choice is yours.  Choosing virtue and leading your business heroically is simply a choice.


I want to close this session with the summation of the governing dynamic here that speaks to the ultimate battle for our freedoms in America.  Given the model just detailed, the governing dynamic is this:  the level of government intervention is inversely proportional to level of virtue practiced in business.  Practice virtue in business; reduce government intervention.  Socialism is what pervasive and overt government intervention looks like.


Our free market in the US is protected and advanced when business leaders choose to practice and perfect virtue in and through our businesses.  Government is left to do only what it can do and socialism is left as it should be; a failed false ideology; a carcass left on the battlefield for freedom.


The idea of practicing virtue in business also has significant implications on how business leaders think about charity and philanthropy.  This is the topic of our next session.  Join us next time as begin the home stretch and wind-up of this series, The Reckoning: The ultimate battle for freedom between socialism and virtue in business.  See you next time.