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December 15th, 2010

To Act in My Own Interest, Or Not?
How Humans Deal With Conflicts of Interest (Part 1)

For several years now, I've been troubled by how humans define the concept of "conflict of interest." My concern has grown as I've realized the importance humans seem to place on avoiding "it", or, at times, even the "appearance of it." The more thought I've given to the topic, the more confused I've become. My confusion stems from the observation that whether or not someone has a conflict of interest seems to depend on who is asking the question, what the context is, and whether or not the answer is in that person's own interest or not.  

Even more confusing is the paradox whereby humans believe that allowing a conflict of interest can be wrong in case A but right in case B. Again, the paradox may only be resolved if one assumes that the perspective of the believer is what determines the judgment of right or wrong.

Let me be a little more specific.

In most situations where humans raise the spectre that someone may have a "conflict of interest," the implicit notion is that having such a conflict is bad and should be avoided. Examples here are cases where a judge may issue a ruling that is in his own interest but not necessarily that of the conflicting parties. Or where a public official makes spending decisions that stand to benefit himself—or his friends, family, supporters, etc.—but not necessarily those who are supposed to benefit from the spending.

Most people I've talked to seem to think that this notion is obvious—that weighing such conflicts of interest in one's favor is wrong and should be avoided. As will become plain later in this essay, I certainly do not disagree with this notion.

On the other hand, either consciously or unconsciously, most humans in modern, West-European-modeled societies entertain notions of conflict of interest that, to my Martian mind, seem antithetical to the the one they espouse publicly. In this less-than-conscious notion, acting in one's own interest is something that society, instead of outlawing, should actually encourage, since acting in one's own interest is a natural human tendency that can't be legislated away. Not only that, but acting in one's own interest is viewed as ultimately the same as acting in everyone's interest.

This essay is the first of a series that will explore some specific cases where Western societies legislate to prevent "conflict of interest," and perhaps more interestingly, where they do not. The cases will be examined in the light of the way self-interest is perceived by individual humans, as well as by humans grouped into various, possibly overlapping, personal and business relationships.

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