If you suffer from the misconception that most of the world is still too poor to buy anything at all, you risk missing out on the biggest economic opportunity in world history while you use your marketing spend to push special "yoga" pads to wealthy hipsters.
- Hans Rosling, Factfulness
We're Failing Capitalism: Part 5 of 5Despite very real and appreciated successes, the way we do capitalism is failing us. The most devastating failures are the growing momentum of climate change, other environmental concerns, and wealth inequality. Either these challenges will destroy capitalism entirely in the end, or we need to modify our approach to capitalism to solve them.
The five parts to the series are:
- The source of the world's problems?
- Some of capitalism's successes
- The winning formula
- We're failing capitalism
- The way things are. Or not.
While capitalism has provided many benefits to the average person over the last 500 years, it is ostensibly failing many of us in obvious ways; with escalating climate forces and other environmental degradation, it will increasingly fail more of us. I used to think that capitalism itself is to blame, but capitalism isn't a living thing, and it only operates according to the conditions that humans specify.
I've felt a bit overwhelmed by the task of distilling all relevant information on this topic to a single blog post offering some realistic solutions. So I've decided to stick with a couple that I really like and find myself sharing most often with people in conversations. I hope you find the following ideas helpful and practical.
Impose costs on negative externalities
The market dynamics in capitalism do not provide any mechanisms in themselves to prevent this behaviour; it requires some forms of non-market intervention either by state or by organized social forces.
- Masoud Movahed, writing for the World Economics Forum
Currently, governments pay for capitalism's environmental effects. If governments tax carbon and other pollutants, the costs are put into the market that caused the debt in the first place. "I actually think a carbon tax together with rebates is, in some sense, the most conservative way to deal with climate change" (Greg Mankiw, chair of the Council of Economic Advisers under President G.W. Bush).
This thinking can be applied to all our major issues. Antibiotic resistance, for example, can be handled in the form of taxes on the meat/agricultural industry so that the market itself adjusts in light of this externality. "Although the majority of antibiotic use occurs in agricultural settings, relatively little attention has been paid to how antibiotic use in farm animals contributes to the overall problem of antibiotic resistance" (source).
Educate ourselves and each other
The learned ignore the evidence of their senses to preserve the coherence of the ideas of their imagination.
- Adam Smith
It's especially old considering the drastic changes in the world in the last 30 years. As we saw in the second post of this series, Some of Capitalism's Successes, poverty, education, hunger, life expectancy and other areas have seen breakthrough transformations in the last few decades. However, if we're not educating ourselves and others about the current state of the world, we're not going to make informed choices.
Until we are educated on today's "what's so" and making educated decisions on how best to move forward, we're just living out high school teachers' views of the world from half a century ago or more.
Or not
How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it, except the pleasure of seeing it.
- Adam Smith, The Theory of Moral Sentiments
I had a picture of the Hubble Ultra-Deep Field image in my old classroom, and I now have it at my desk. I find it calming to zoom out from my personal life sometimes, and this image helps me do that.
I don't need reason and logic to know that I love my kids, but reason often helps me shake off frustration and anger faster than they'd leave on their own. I don't need reason and logic to feel compassion and empathy for other people and other life, but reason helps shift my perspective to remember to be open to it. Likewise, viewing the Hubble Ultra-Deep Field image has a feeling to it as well as a reasoning to it, to me.
We're headed towards some changes - technological, social, and environmental. Nearly everyone I talk to about climate change and other environmental challenges, let alone the topics of psychological and social impacts of our modern living, pretty much agree that we're screwed and there's nothing we can do about it. That perspective is quite reasonable, and it's quite convenient.
It's easier to not try. It's easier to not get invested. It's easier to get wrapped up in everything else we deal with in our day-to-day lives than to consider the future. Saying there's nothing that can be done is certainly easier than struggling to find something that can be done. I agree!
But all it takes is to say, "Or not." We're screwed...Or not. There's little hope...Or not. There's no way we can turn things around...Or not. Or not opens a door a little bit. We might not know how to get there yet, and we might not know what role we can play, but maybe there is another way.
(A close friend of my wife and me likes to say "Who says?" in response to limitations. Who says you can't have dessert before dinner? Who says we can't transform society so that everybody wins?)
Rethinking how we do capitalism and how we engage with our capitalist system is worthy of the grander vision - one where people and non-human life are respected, valued, free, and fulfilled. I much prefer the vision of a world that works for all life than the resigned perspective that this is just the way things are and the way they'll be.
The view that this is just the way things are and the way they'll be affects how we do capitalism, and either capitalism will die or we'll learn to use it to manifest a world that works. Our impact on the world will be remade either way - life's wonders are worth it.
