In this essay we will discuss what Kant’s and a utilitarian’s view on insider trading would be. As we have discussed in previous essays, Kant believed that moral rules could be known through reason and not just by observation (Shaw and Barry 69).
For me this is the basis of all decisions that we make and why I would support Kant’s point of view on insider trading. Utilitarianism concentrates on producing the greatest amount of happiness and using it as a standard to determine if an action is right or wrong (Shaw and Barry 62).
Utilitarianism requires too much concentration on individual aspects of what the greatest happiness is and basing moral standards around them. Kant believed that good will was the only thing truly good that could be used to determine a person’s morality. This good will would make people act out of a sense of duty and not for example, out of self-interest or emotion. Kant used a categorical imperative to determine an actions moral worth. This imperative states that we should always act to will the maxim, or subjective principle, of that action into a universal law (Shaw and Barry 70).
I believe Kant would say that insider trading was immoral because inside traders typically act out of self-interest. To prove it a maxim for inside traders could read as follows: “I know insider trading is illegal but I will still do it in order to minimize or maximize my personal interests. ” This proves that an inside trader knows that this act is immoral, but will still indulge in it in order to preserve self-interest. From an organizational standpoint, Kant believed we should follow the rules laid out for us regardless of the outcome and that we should act on principles when making moral decisions.
The Essay on Insider Trading Stewart Martha Information
Insider Trading Martha Stewart, the countries top icon for homemaking has been in the eye of the public since June 2002, but not for her craftiness or culinary abilities. Stewart instead has the spotlight on her for crimes of insider trading. A tip from her former broker Peter E. Bacanovic, persuaded her into selling her IMClone stock after sharing information about a close friend of Stewart's ...
Insider trading is damaging to the majority of stock holders who do not have ties to the “inside circle” of the organization. While the insiders save themselves from disaster the rest of the investors lose heavily. This is also an example of using people as means to an end, which is forbidden by Kant, because the families and livelihoods of investors have been put at risk in order for a chosen few to save themselves from disaster. I believe this to be inhumane to deny an individual the right to self preservation which essentially what is happening when insiders’ trade before the information is made public.
Utilitarianism states that we must evaluate how our actions will affect everyone involved in certain situations. If the results of our actions net more good or happiness than bad for all of us, compared to any other action, then this is the correct action to take (Shaw and Barry 62).
A utilitarian could deem insider trading either moral or immoral depending on the net of good or bad from the action and the relationship the stock holder has to the organization, such as someone with a fiduciary relationship to the organization as opposed to a rival looking to take over.
For example, if the insider information was good news for the company, it would cause a rise in stock prices and all investors could benefit from it. If the information was to be shared with all the stockholders and everyone could make a profit, it could be deemed a positive that maximized everyone’s happiness. If the information was not shared and only a handful of investors were able to take advantage it would be immoral because it didn’t produce happiness for all.
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"You cannot teach a man anything; you can only help him find it within himself." -Galileo Can a United States president, a Greek philosopher, an influential astronomer, and world-class author disagree on a single, seemingly simple topic? One that is ever present in the everyday life of all throughout the world? How can names like Aristotle, Emerson, Galileo, and Garfield disagree on such a topic ...
Another example would be if an insider came to possess information that would potentially put the company out of business, would it be immoral for this insider to pass it along to a rival? This could potentially save jobs that would create more happiness for all. The problem with utilitarianism in this aspect is that it leaves room for immoral actions to be considered moral based on a result and not on the character of the action itself.
At least from Kant’s point of view we know that insider trading is wrong because of the guidelines involved in business that tell us this is wrong and therefore we know better than to indulge in self interest. Utilitarianism seems to blur that line by deciding if an action is good or bad based on what any individual or group of individuals feel is best for them. The greater good for that group could produce the most happiness for them making their actions moral. This is why I agree with Kant over utilitarianism.
