The system of global capitalism deteriorates the cultivation of virtue, driving social inequality.

When people fail to extend the virtuous quality of family relations to social relations outside the family in capitalist societies, the reverse dynamics take over, so that even family relations become infected with the obsession with material gains, as is evident in litigation among family members fighting over inheritances, and other similar cases. Relentless competition is not limited to the accumulation of capital but pervades the whole society—we see this even in competition for grades and limited university spaces in disciplines that are popular usually because they are “marketable.” Instead of personal cultivation, we find education turned into a means of making money. 34 Even the much admired emphasis in East Asian societies on education that is attributed to Confucian influence becomes perverted: parents concerned over their children’s economic future put so much pressure on them to do well in the increasingly competitive economic environment that this undermines the family relationship and fails to cultivate a Confucian ethical character in their children.35 Cultivating virtuous Confucian relationships has never been easy, but there are forces in global capitalism that make it even more difficult, if not impossible. The most important human relationships in traditional societies are face-to-face relationships of embodied interactions, but globalization connects people located in various parts of the world who often never meet in person, and decisions and actions in one part of the world affect many in faraway places. The valued qualities of various human relationships in the Confucian understanding are cultivated through everyday interaction at close quarters through ritual practice; such cultivation is not possible in the type of remote interactions that characterize many relationships in global capitalism. A Confucian sage-king’s virtue can embrace the whole world, at least in theory, but it is rooted in the humaneness (ren 仁) of person-to-person interaction, “establishing others in seeking to establish oneself, promoting others in seeking to promote oneself” (Analects 6.30). And humaneness begins with filial and fraternal responsibility in the family (1.2). It is much more difficult to disregard the effect of one’s actions on those whom one encounters every day than on those who live half the world away; their humanity and the reality of harm to them and their suffering impinges less on one’s consciousness with increased physical distance. Even though new technologies give access to information about what is happening in other parts of the world, not everyone has equal access. For those with access, selectivity is necessary, and too many choose to ignore unpleasant information. Unlike immediate experience, overexposure through the media can also breed indifference to people’s sufferings. Global capitalism allows investors to become wealthy without ever having to give a thought to whether the same economic processes keep millions working for low wages in conditions injurious to their health, destroy local communities by putting people out of work when factories are moved overseas, or contribute to the degradation of the environment. Those at the front lines of exploitative and other unethical practices—factory supervisors, middle management, or sales staff, for example—if they have any doubts about the ethics of the businesses they work for, salve their conscience by pushing the responsibility on to the decision makers higher up the chain. When questioned about their failure to protect their people (whether as workers or consumers) and the environment, governments cite the need to provide a “business friendly” regulatory environment in the competition for transnational capital to promote economic growth. Global capitalism attests to the adage “If one’s aim is wealth, one cannot be humane” (Mencius 3A3). According to the neoliberal ideology, market freedoms are natural and desirable and conducive to economic growth, while government intervention should be limited to maintaining macrostability to facilitate the workings of the free market. Critics such as Polanyi and Gray point out that the free market is in fact an artificial creation of state power and is maintained by a collusion of economic and political interests.36 Neoliberal ideology has been challenged, and many East Asian societies have followed different development paths, with the government often playing a much more interventionist role than prescribed by neoliberals. This has been interpreted as a Confucian legacy since the Confucian idea of a good government is one that takes care of the people’s livelihood, which in today’s world means reducing poverty by increasing GDP through various policies and state actions. The Confucian requirement that governments give priority to the worst off in society may also have resulted in policies that help reduce inequalities and ensure a more egalitarian distribution of economic growth, at least in the initial years of development. However, after a period of falling inequality, East Asian economies also began to display the pattern of increasing inequalities that dominates capitalist economies. Excessive inequalities are socially divisive and destabilizing. The worst excesses of capitalism in the nineteenth and early twentieth centuries were curbed by the state stepping in to regulate the market and redistribute wealth and income, as well as to relieve poverty and promote social welfare through public spending.