Edward Quince's Wisdom Bites: Friedman Conversations Pt. 3

Conversation 3: Corporate Social Responsibility, Virtue, and Totalitarianism

Topic: The moral and practical consequences of incorporating social goals into business strategy.

Friedman Doctrine (Milton Friedman):
When businessmen speak of “social responsibility,” they drift into politics. This is a misuse of power that undermines both capitalism and democracy. The corporate executive’s job is not to legislate morality but to maximize profit within the bounds of law and custom. Every dollar diverted to a social cause is a tax imposed without consent—an erosion of the shareholder’s right to allocate his own capital. The firm’s clarity and integrity come from subtraction, not addition: do one thing well—create value.

Centesimus Annus (Pope John Paul II):
The greater danger is not that executives assume too much responsibility, but that they assume too little. When societies reject objective moral truth, democracy itself decays into a totalitarianism with better branding. A business that denies virtue in its operations does not liberate man; it dehumanizes him. Justice and solidarity must inform every economic structure, for freedom without truth soon becomes a mask for domination.

Rerum Novarum (Pope Leo XIII):
The market cannot be its own moral compass. When commerce forgets the dignity of the person, it cultivates the soil for resentment and disorder. Peace cannot be purchased through profit alone. A just society depends on moral formation—on the cultivation of virtue and the renewal of institutions rooted in truth, charity, and the common good.

Calculus of Value (CV):
From the perspective of enterprise, the tension between short-term price and long-term value mirrors the struggle between expediency and virtue. The temptation to chase the “new new thing” (today, perhaps AI) leads many to confuse movement with progress. Sustainable value demands intellectual humility: the willingness to test one’s own assumptions, to recognize that knowing only your side of the case means you understand very little. Resilience, like morality, is built over time—through restraint, discipline, and self-awareness.

Reflection:
If Friedman defends clarity through efficiency and Leo and John Paul argue for virtue as the soul of freedom, then the calculus between them is this: markets may organize exchange, but only morals organize meaning. Profit tells us how well we are doing; virtue tells us what for. A free society forgets that distinction at its peril.