JOHN STUART MILL: MORALITY OF MARKETS AND THE PURSUIT OF HAPPINESS

Born in 1806, John Stuart Mill was a utilitarian philosopher and economist. He believed that economics should have the purpose of providing utilitarianism, or providing the greatest good for the greatest number. Mill, inspired by pre-existing economic ideas, such as Smith’s Invisible Hand Theory, focused more on the ethical and moral aspects of economics.

Mill’s theory was rooted in utilitarianism–which we discussed in an earlier blog–classical economics, and the Enlightenment. Classical economics is built on the theory that production and exchange are necessities but also should have a focus on social reform and ethicalities. The Enlightenment movement was popular during the 18th century and focused on individual freedom and natural rights.

Speaking of natural rights, let’s discuss the core ideas of Mill’s philosophy. The first was individual liberty, undoubtedly inspired by the Enlightenment, which argued that people should be free to pursue whatever interests they want to in an economic society in order to maximize their own happiness. The second is that utilitarianism is the key moral standard and every economic system should provide utility; in other words, utilitarianism is against systems that prioritize elitist minorities. Finally, Mill supported the idea of free market systems and believed that resources should be redistributed in order to prevent structural inequality, as he believed that that would corrupt social harmony; this theory is known as progressive distribution.

Let’s look into a few modern examples of Mill’s economic ideas. One example is welfare capitalism; this is a system where a government provides education, healthcare, and social safety with their funds. This provides an authoritative example of using economic resources for the utility of society. Another example is progressive taxation, which is where the tax of a person depends on their income. This reduces the disproportionate taxation system in the United States right now that taxes the poor unfairly more than the elite, rich individuals. By using a progressive tax, we would be able to provide utilitarianism by taxing the elite minority more and taxing the impoverished less, allowing the most people to survive.

Some contrasting philosophies include Marx’s economic theories. While both philosophers advocated against inequality and recognized it as a key issue, Marx wanted to abolish capitalism altogether, while Mill simply wanted to make reforms. Mill’s theory also contradicts slightly with Adam Smith’s; Smith focused on the individual interests of a person leading to greater good, while Mill argues that people should be fueled by wanting the greater good for everyone itself.

However, there are many questions that arise with Mill’s theory. How far can society intervene without suppressing freedom? Can happiness be measured? How could this harm capitalism?