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  1. A creditor incurs loss till and not before the time when they are paid.
  2. The creditor requires a pay of interest, an amount extra to what is owed by the debtor.
  3. The interest payment may be seen as a bribe forstalling other potentially profitable investments the creditor could have used it in and.

If net balance is the moral standard, it is okay to make immediate sacrifices for and in the expectation of future payback? Such as in the loan service, where a debtor agrees to suffer a net loss "sacrifice" for a temporary gain "loan" and the creditor agrees to suffer a temporary loss "investment" for a net gain "profit". But if net balance is the real moral standard, then would it be judged moral for a loan service to apply interest rates on its loans? Is this theft by the creditor on the debtors wealth?

Trust is essential in an investment/loan situation. More generally, given net balance as the standard of relationships; this would be the basis for comradeship/partnership; an expected benefit from mutual sacrifice.

So, welfare is legitimate when net result is even or positive to stakeholders, welfare sponsors and recipients. The form of payback the sponsors receive can be: economic, labour, monetary etc. To accomplish this welfare receipents would need preparation for the part in their payback.

Where a democratic majority agrees to this policy. All that is necessary is to demonstrate how in the policy will the gains be made. And it is the interest of the population to have more contribution to the economy, so it is in the rational self-interest to help beggars into jobs and security. Rational self-interest becomes an accountancy task when justifying sacrifice.

If loans and "accepting loss for future gains" is not moral, then banking is immoral. So unless I have made an error, either welfare is moral or banking is immoral; which is it "accept loss for future gain" or not in which no banking?

Also, is gambling immoral if you lose? The judgment on gambling has parallels in the stock market.

asked Dec 20 '11 at 20:07

Adeikov's gravatar image


edited Dec 23 '11 at 04:10

Greg%20Perkins's gravatar image

Greg Perkins ♦♦

The reward for one's action need not be immediate. Even altruists will say that it's not altruism if there is expectation of payback of any kind, either immediately or in the future. So, if it isn't altruism, what is it? How about "trade" and/or "investment"?

(Dec 20 '11 at 20:46) Ideas for Life ♦ Ideas%20for%20Life's gravatar image

So, nothing matters but the promise and fulfilment of future gains, sacrifice in mean time is acceptable?

(Dec 20 '11 at 20:57) Adeikov Adeikov's gravatar image

If the answer to that question is YES, then what becomes so wrong with the Marxist promise and future fulfilment of class equality and presumably a good standard of living for everyone? If sacrifice now is acceptable for the fulfillment of a dream, then can objectivism really be incompatible with Marxism? That laissez-faire capitalism be the platform for an emulation of communism? What I mean is capitalism is the medium in which communism can be born? A mother to child relationship?

(Dec 21 '11 at 08:43) Adeikov Adeikov's gravatar image

There seems to be a typo in the question: "Is it moral to give loans to people as a temporary sacrifice, and is it moral to oblige a take of interest as sacrifice on the debtor?"

Specifically, the second half: "to oblige a take of interest" ? I don't understand.

(Dec 21 '11 at 22:19) John Paquette ♦ John%20Paquette's gravatar image

To make it a duty or obligation to pay interest

To oblige a person to pay interest on the loan in conjunction with the capital amount.

If the creditor is paid back the capital amount, s/he has incurred no loss, have they? It does not cost to hand money over and receive pay later? So to make it necessary to pay interest is to ask a sacrifice of the debtor more than the net of the transaction.

(Dec 21 '11 at 22:35) Adeikov Adeikov's gravatar image

I have tried to make the question clearer. I might edit the details to match the new rhetoric.

(Dec 21 '11 at 22:57) Adeikov Adeikov's gravatar image

No, it is to ask them to pay for the use of the money for a period of time. An important concept here is the time value of money. The point, in brief, is that the creditor could have used the money she lent to the borrower to invest and make more money. Suppose she could have made $X. By lending the money, she lost that opportunity. To make it worth her while to lend the money, she needs to charge at least $X in interest.

(Dec 21 '11 at 23:03) ericmaughan43 ♦ ericmaughan43's gravatar image

Conversely, the borrower gains more value from the use of the money than the face value of the loan, because she can invest it and make a profit. Thus, paying $X in interest is not a sacrifice--she gained more value than she paid out. (unless she made less in profit than the interest payment, in which case it is a sacrifice; however, even then the lender did not demand a sacrifice--she demanded payment for a valuable service--the fact that the person ended up squandering the value does not mean the lender forced her to sacrifice).

(Dec 21 '11 at 23:07) ericmaughan43 ♦ ericmaughan43's gravatar image

So, there is a risk of either a moral or immoral outcome for both parties depending on their wisdom in the mean time between lending and payment.

(Dec 21 '11 at 23:17) Adeikov Adeikov's gravatar image

Yes. If one lends or borrows irrationally, then you run a much greater risk of ending up sacrificing. If you lend or borrow rationally, then you run a much smaller risk of ending up sacrificing, but you cannot control all things. This is not unique to lending/borrowing though. For example, a person can go to school to get a degree in anticipation of a productive and happy career. He invests serious time and money. It may turn out, however, that the career he chose is not good for him, and the value he obtains is less than that he invested. Has he sacrificed? Yes.

(Dec 21 '11 at 23:35) ericmaughan43 ♦ ericmaughan43's gravatar image

One of the goals of ethics, life-promoting ethics anyway, is to help us learn how to avoid such sacrifices. If we are rational, have integrity, are independent, honest, etc., then we are much less likely to make inadvertent sacrifices. Furthermore, we develop the skills and character to help us correct mistakes that we make so that we make even fewer.

(Dec 21 '11 at 23:38) ericmaughan43 ♦ ericmaughan43's gravatar image

But the next step in your reasoning ("then banking is immoral") is incorrect. The fact that a person could take an immoral action in an interaction does not make an entire institution immoral. If the only possible outcomes were immoral, then maybe we could talk about banking as such being immoral. However, that is not the case.

(Dec 21 '11 at 23:43) ericmaughan43 ♦ ericmaughan43's gravatar image

So, synonyms for parts of Objectivism:

Competition Championship

Does Rand realise the inherent capacity for losers in any competition, so to engage in a competition creates sacrifice and everyone that participates has a role in that, the champions take from the vanquished?

Is WIN–LOSE an acceptable outcome if someone always takes a sacrifice in that competition?

(Dec 21 '11 at 23:48) Adeikov Adeikov's gravatar image

Freedom and Value-Creation would be better words.

Rand does not see rational beings as being locked in a zero-sum competition. Rand see's individuals creating values in the world, first and foremost, and then trading those values with other value-creators in exchanges that are mutually beneficial. If the exchange were not mutually beneficial, then the people would not engage in it. Your line of questioning focuses in on the fact that people can sometimes be wrong in their estimation that a transaction is in fact beneficial to them. However, that is not the norm.

(Dec 21 '11 at 23:51) ericmaughan43 ♦ ericmaughan43's gravatar image

The lender benefits from the interest, the borrower from the investment of the loaned money. WIN-WIN. All benefit from the freedom to enter such transactions, even counting the small chance that they may sometimes fail.

The lender does not compete with the borrower. The lender benefits from having customers, the borrower from having a funding source. It is not in either one's interest to see the other fail. Only irrational men believe the destruction of others is in their "interest," and they are wrong.

(Dec 22 '11 at 00:21) ericmaughan43 ♦ ericmaughan43's gravatar image
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Objectivism challenges the conventional view of what is or is not a sacrifice. (The most consistent altruists, especially Kant, also challenge whether some of the conventional usages of "sacrifice" truly constitute sacrifices.) For the Objectivist view, one can find more than three full pages of helpful excerpts under the topic of "Sacrifice" in The Ayn Rand Lexicon. There is also a moderately lengthy discussion of it in Galt's Speech in Atlas Shrugged. Approximately half of the Lexicon material on "Sacrifice" consists of a single, lengthy excerpt from Galt's Speech.

answered Dec 20 '11 at 21:21

Ideas%20for%20Life's gravatar image

Ideas for Life ♦

You are confusing sacrifice with investment.

Objectivism advocates the pursuit of self-interest, rationally identified, over the long term. Not consuming something right now is perfectly compatible with this -- indeed, often enables it. It is never ok to sacrifice, i.e. to surrender a greater value in favor of a lesser value or a non-value. But that isn't what investment is. Nor is it "Altruism in the expectation of returned altruism." I don't make myself worse off to benefit someone else in the hopes they will make themselves worse off for my benefit later. Proper social relationships are not mutually parasitic, they're mutually beneficial. I trade values with others to make myself better off, and they accept the trade because it makes them better off.

You can't slide from investment to welfare either. Voluntary charity can be moral. A "democratic majority" disposing of my wealth and effort because it thinks it knows what to do with the products of my thought better than I do is just a violation of my rights.

Gambling is entertainment. As long as you can afford the losses you incur and they are, in your hierarchy of values, worth the enjoyment you gain from the process, I don't see it as much different from paying for dinner and a movie. As for the alleged parallel to the stock market let me quote Midas Mulligan, the banker from Atlas Shrugged: "The reason you will never be rich is because you think that what I do is gambling."

answered Dec 21 '11 at 14:06

Kyle%20Haight's gravatar image

Kyle Haight ♦

Civilisation is a project humans invest in to reap benefits, one of those is security & protection from the uncertainties of the wild and the hostility of rival tribesmen that participates in that culture of people. And like a house of cards, it requires mutual support, those that reap but do not give weaken civilisation. Your profit is relative with the security of civilisation.

Welfare is an investment in people that would otherwise deteriorate, random acts of charity is not enough, someone has to care enough about them to coach them into financial independence.

Civilisation is a machine.

(Dec 21 '11 at 15:50) Adeikov Adeikov's gravatar image

As for welfare, the analysis has to begin and end with the recognition that it is forced, that it depends upon the violation of individual rights. Nevermind the economic outcome, you will not achieve moral ends by immoral means.

(Dec 21 '11 at 16:13) FCH FCH's gravatar image

The only morality is that of the organism. Without organism there is no such thing as life. Organism is the will that wills survival, it is not any ego that wills it, the ego only asks, and the organism fulfils it. The ego is the fruit of the organism, a gift.

So, may we call civilisation an organism too? If the parts, you and I and all, are not supportive of the organism, if parts begin to fail and the better parts fail to fix it, then the whole organism will suffer, and we are all corrupted in our moralities to let it suffer.

Can you refute that? That organism is the highest value.

(Dec 21 '11 at 18:07) Adeikov Adeikov's gravatar image

Um, what..? I'm sorry, but now we're talking two completely different languages. You really should take the recommendations you're getting and read Rand herself (or Leonard Peikoff's "Objectivism: The Philosophy of Ayn Rand" - I haven't read it yet, but I gather it's a really good single presentation of Objectivism). Understand that I'm not saying go read scripture, then thou shall believe, but only that you should read up on the Objectivist position on morality etc. so that we can have a meaningful discussion of them (and so that you can meaningfully critique them)

(Dec 21 '11 at 18:26) FCH FCH's gravatar image

For what it's worth, though, it seems you've arrived in a certain sense at a very basic point: individualism vs. collectivism. To take "civilization" as an organism and furthermore to derive moral principles from that is collectivist, and wrong. Only individuals exist, "civilization", or "society" are abstractions that don't have a mind of their own.

Also, morality doesn't come from an "organism", it comes from man, i.e. a rational being, i.e. a being (an animal) that is capable of rational thought. If you're interested in this, look up "The Objectivist Ethics", it's available at aynrand.org.

(Dec 21 '11 at 18:33) FCH FCH's gravatar image

I am sorry if I came too strong there, I am attached to neither individualism or collectivism, more that when a possible counter point forms in my mind I usually play my piece. I still have not justified individualism in my own mind yet in light of counter points. Thank you for the recommendation.

(Dec 21 '11 at 19:49) Adeikov Adeikov's gravatar image

At least you accept that you have your own mind. :)

That's a good start.

(Dec 21 '11 at 21:11) anthony anthony's gravatar image
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You are still using "sacrifice" incorrectly, despite the other answers' and comments' attempts to explain to you the definition. You are using "sacrifice" to mean any time a value is relinquished, regardless of the expected or actual return. This is simply wrong.

The key distinction between welfare and other transactions (banking, etc.) is that welfare payments are taken from payers by force, while business transactions are entered into freely. The initiation of force violates the rights of those forced to pay. The victims of extortion for welfare are never better off, even if they get paid back more money later. The loss of one's freedom cannot be so easily compensated. Once the principle "the government can violate rights as long as it is acting, in its infinite wisdom, in the interest of the victims" is accepted, people are doomed to lose all their freedom, because anything the government does it will justify as being in the people's interest.

Let me reiterate: Objectivism rejects the notion that a majority can do whatever it wants as long as its actions are "beneficial." It also rejects the notion that such actions actually are beneficial. The current results of a century-and-a-half of governments acting "in the public interest" should be proof enough for you that what they call the public interest is not in the interest of the public.

Furthermore, values are objective, but not intrinsic. For something to be an objective value to someone (1) they must recognize it as a value, and (2) it must actually enhance their life. Not only is compensation for forced welfare payments not life enhancing (as discussed above), but it also is not chosen by the victim, and thus is not a value to him.

If, on the other hand, you mean charity rather than welfare (I sense some things might be getting lost in translation), that is a different story. Charity is voluntary, and can result in a WIN-WIN transaction. However, one would have to evaluate such transactions on a case-by-case basis to see make sure it really was not a sacrifice.

Here it is straight from Rand herself:

The objective theory of values is the only moral theory incompatible with rule by force. Capitalism is the only system based implicitly on an objective theory of values—and the historic tragedy is that this has never been made explicit.

If one knows that the good is objective—i.e., determined by the nature of reality, but to be discovered by man’s mind—one knows that an attempt to achieve the good by physical force is a monstrous contradiction which negates morality at its root by destroying man’s capacity to recognize the good, i.e., his capacity to value. Force invalidates and paralyzes a man’s judgment, demanding that he act against it, thus rendering him morally impotent. A value which one is forced to accept at the price of surrendering one’s mind, is not a value to anyone; the forcibly mindless can neither judge nor choose nor value. An attempt to achieve the good by force is like an attempt to provide a man with a picture gallery at the price of cutting out his eyes. Values cannot exist (cannot be valued) outside the full context of a man’s life, needs, goals, and knowledge.

What Is Capitalism?, Capitalism: The Unknown Ideal, p. 23

answered Dec 22 '11 at 10:28

ericmaughan43's gravatar image

ericmaughan43 ♦

edited Dec 22 '11 at 12:23

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Asked: Dec 20 '11 at 20:07

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Last updated: Dec 23 '11 at 04:10