OC ACXLW 87: Moral Contradictions & Rethinking Shareholder Value
Saturday, February 22, 2025 | 2:00 – 5:00 PM
Location: 1970 Port Laurent Place, Newport Beach, CA 92660
Host: Michael Michalchik (michaelmichalchik@gmail.com | (949) 375-2045)

Topic 1: Scott Alexander’s “Everyone’s A Based Post-Christian Vitalist Until The Grooming Gangs Show Up”

Reading Link:
Everyone’s A Based Post-Christian Vitalist Until The Grooming Gangs Show Up

Summary Highlights

• Core Argument: Alexander critiques those who claim a tough, tribe-only moral code—yet paradoxically display deep compassion for faraway strangers once a scandal (e.g., Pakistani grooming gangs in the UK) resonates with their political interests.
• Hidden Universal Morality: Though some posture as “Nietzschean supermen,” condemning distant charitable impulses as “slave morality,” they swiftly adopt moral outrage for neglected foreign victims.
• Implication: This suggests everyone harbors broader empathy than they admit. People’s moral philosophies often adjust to whichever scenario triggers identity-based or emotional resonance.

Potential Discussion Questions

1. Selective Compassion: Why do individuals claiming to reject universal empathy become passionately concerned about a crisis in a foreign land?
2. Identity Politics: How does ideological framing flip “I don’t care about others” to “we must intervene” once it aligns with group loyalties?
3. Reconciling Contradictions: Alexander outlines possible ways to handle moral inconsistencies. Are any feasible without fully abandoning empathy or adopting total cynicism?

Topic 2: Lynn Stout’s Critique of Our Economic Paradigm

Reading Link:
Professor Lynn Stout’s critique of our economic paradigm
(Four short essays)

1) How the Dominant Business Paradigm Turns Nice People into Psychopaths

• Premise: “Shareholder-value dogma” encourages investors/managers to ignore ethics—leading even inherently moral folks to act purely for short-term profit.
• Prosocial Reality: Empirical data (like social dilemmas) show humans frequently cooperate. But the market’s “maximize stock price” ethos can suppress such instincts.

Questions

• In what ways do you see “lowest-denominator profit” overshadowing normal moral inclinations in corporate/financial contexts?
• Does socially responsible investing fail mainly due to structural collective-action problems?

2) Why Wall Street Isn’t Useful for the Real Economy

• Key Critique: While bankers tout “liquidity” and “price discovery,” the vast majority of trading is in the secondary market, not fueling real capital formation.
• Over-trading: High trade turnover mostly benefits finance insiders, offering minimal real growth or resource reallocation.

Questions

• Could scaled-back trading or a transaction tax balance legitimate liquidity with avoiding zero-sum speculation?
• Are there intangible benefits to the massive churn of stocks beyond profit for traders?

3) How Economists Turned Us Blind to Our Own Goodness

• Central Idea: Policy/business experts fixate on incentives-based systems, ignoring people’s natural conscience and altruism.
• Implication: Emphasizing extrinsic rewards can “crowd out” trust and prosocial norms—just as tying executive pay exclusively to share price can lead to fraud or abuse.

Questions

• How might laws or corporate governance structures harness conscience (moral suasion, social norms) without building in naive altruism?
• Does focusing on “employee empowerment” or “commitment to community” measurably improve behavior?

4) The Dumbest Business Idea Ever: The Myth of Maximizing Shareholder Value

• Legal Myth: Directors aren’t actually bound by law to maximize share price, and attempts to do so haven’t proven better for shareholders long-term.
• Satisficing: Stout suggests corporations hold multiple goals—like stakeholder loyalty, R&D, social impact—rather than “optimize” one metric.

Questions

• If managers are legally free to consider multiple objectives, what cultural or institutional factors still push them to single-mindedly chase share price?
• How could “satisficing” be measured to ensure accountability?

We Hope You Join Us!

Expect a lively, multidimensional discussion—ranging from moral illusions in politically charged contexts to illusions of “shareholder primacy” in economic thought. Whether you come for philosophical debate or pragmatic business critique, your perspective is welcome. See you on February 22!

For more info or questions:
Please contact Michael Michalchik (see details above).

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