An exchange on Global Capitalism: Reflections on a Brave New World
I very much appreciate Robinson’s evolutionary, “epochal shift” perspective, and the call to move beyond capitalism.
The article gives a very comprehensive description and analysis of what is happening in the global economy—the faster movement of money, concentration of wealth and power, political capture, increasing austerity and privatization, decreasing availability of secure work opportunities, automation, and scapegoating of minorities.
I wish I could argue with the grim picture it paints, but, unfortunately, I get the same picture from my analysis. Instead, I feel like I can best contribute to this discussion by digging more deeply into why all of this is happening. If we want to get to the roots of the problem, we must question the way our economy is organized and why.
Over the past five years, I have been exploring these questions in-depth with my Post Growth Institute colleague, Donnie Maclurcan. We have found a very helpful way of demystifying capitalism. The capitalist economy is a system in which businesses operate in order to deliver profits to private owners. In other words, it is an economy made up of for-profit businesses. And it is based on a set of very outdated assumptions about human nature, motivation, and behavior.
In light of this definition, is the concentration of wealth and power we are witnessing now a result of a new global capitalism, or is it just where capitalism would inevitably end up because of its guiding logic?
It is important to see that capitalism is based on for-profit legal structures because it helps us realize that for-profit businesses are supposed to be greedy. They are set up to maximize returns on investment. That is how the profit motive works. It is not an exception, but rather a rule that they seek “immediate profits over the general and long-term interests of the system,” as Robinson puts it. According to the logic of the for-profit system (capitalism), business owners and managers are supposed to “freely search for the cheapest labor, lowest taxes, and laxest regulatory environments.”
Having spent the past five years investigating the transformative potential of not-for-profit (NFP) business frameworks*, I’ve come to see “large corporations,” “deregulation,” “the market,” “capital,” “capitalists,” and “global economy” almost as red herrings. They distract us from examining the fundamental logic of for-profit models: private ownership of businesses coupled with the profit motive. Scale, competition, and regulation would not be nearly as important if ownership and motivation in the market were geared towards community benefit rather than individual accumulation.
A transition requires the transformation of basic assumptions, beliefs, and norms that guide economic activity. If we accept the story that human nature is mostly greedy and selfish, that evolution is based only on ruthless competition, that success is material accumulation, and that development is high income per capita and growing GDP, then we are actually participating in and reinforcing the existence of a transnational capitalist class. According to this story, they are simply being rational and doing exactly what they should to be doing. They epitomize for-profit success and prosperity.
Buckminster Fuller said, “To change something, build a new model that makes the old model obsolete.” Does the transformation for which we are working have to be framed as a struggle or a battle? I feel that it can be a much more creative, engaging process of bringing a new civilization into being (part of which involves struggle, but that need not be the focus). That’s where I see NFP businesses and entrepreneurs playing a very important role.** They are paving a path for a whole new system, based on totally different assumptions about how humans can and should act and what business can and should be.
We must go beyond thinking about redistribution and regulating greedy markets, to creating markets and business that have distribution built into the very way they function. Must markets and businesses be oriented towards accumulation of wealth? Must workers always have to struggle against owners? No. Businesses can be oriented towards social and environmental health, without private owners—they can be not-for-profit. There are many thousands—perhaps many millions—of people working in businesses that earn their own revenue but are legally required to put all profit into community benefit. Our hunch is that they are paving the way beyond the profit motive, beyond the market-state dichotomy, and beyond capitalism.
* NFP businesses should not be confused with traditional nonprofits, charities, and NGOs, which largely rely on philanthropy and grants from the for-profit economy. We’re looking at NFPs that generate most or all of their revenue through the sale of goods and services.
** For more information about the Not-for-Profit World model we’ve developed, see our latest article: www.ephemerajournal.org/contribution/not-profit-world-beyond-capitalism-and-economic-growth.
Jennifer Hinton is a co-director of the Post Growth Institute, a global network of researchers and activists seeking pathways beyond the growth-based economic system; a Marie Curie PhD fellow at the Stockholm Resilience Centre; and a co-author of the forthcoming book How on Earth: Flourishing in a Not-for-Profit World.
As a forum for collectively understanding and shaping the global future, GTI welcomes diverse ideas. Thus, the opinions expressed in our publications do not necessarily reflect the views of GTI or the Tellus Institute.
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