Aug 4, 2017

Capitalism's Excesses Belong in the Dustbin of History. What's Next Is up to Us

It’s time to dethrone capitalism’s single-minded directive and replace it with a more balanced logic, laying the foundations for a better, more equitable world
By Martin Kirk / theguardian.com
Capitalism's Excesses Belong in the Dustbin of History. What's Next Is up to Us

Back in February, a college sophomore called Trevor Hill stood up during a televised town hall meeting in New York and put a simple question to the House minority leader, Nancy Pelosi. 

Citing a study by Harvard University that showed that 51% of Americans between the ages of 18 and 29 no longer support capitalism, Hill asked if the Democratic party would contemplate moving farther left and offering something distinctly different to dominant rightwing economics? Pelosi, visibly taken aback, said: “I thank you for your question,” she said, “but I’m sorry to say we’re capitalists, and that’s just the way it is.”

The footage went viral on both sides of the Atlantic. It was powerful because of the clear contrast: Trevor Hill is no hardened leftwinger. He’s just your average millennial – bright, well-informed, curious about the world and eager to imagine a better one. By contrast, Pelosi, a figurehead of establishment politics, seemed unable to even engage with the notion that capitalism itself might be the problem.

Nancy Pelosi CNN Town Hall

It’s not only young voters who feel this way. A YouGov poll in 2015 found that 64% of Britons believe that capitalism is unfair, that it makes inequality worse. Even in the US it’s as high as 55%, while in Germany a solid 77% are sceptical of capitalism. Meanwhile, a full three-quarters of people in major capitalist economies believe that big businesses are basically corrupt.

Why do people feel this way? Probably not because they want to travel back in time and live in the USSR. For millennials especially, the binaries of capitalism v socialism, or capitalism v communism, are hollow and old-fashioned. Far more likely is that people are realizing – either consciously or at some gut level – that there’s something fundamentally flawed about a system that has as its single goal turning natural and human resources into capital, and doing so more and more each year, regardless of the costs to human well-being and to the environment.

Because that is what capitalism is all about; that’s the sum total of the plan. We can see it embodied in the imperative to increase GDP, everywhere, at an exponential rate, even though we know that GDP, on its own, does not reduce poverty or make people happier and healthier. Global GDP has grown 630% since 1980, and in that same time inequalitypoverty and hunger have also risen.

The single-minded focus on the growth of the capital supply is why, for example, corporations have a fiduciary duty to grow their stock value before all other concerns. This prevents even well-meaning chief executives from voluntarily doing anything good, such as increasing wages or reducing pollution, when doing so might compromise the bottom line – A\as the American Airlines CEO, Doug Parker, found earlier this year when he tried to raise workers’ salaries and was immediately slapped down by Wall Street. Even in a highly profitable industry – which the airlines are, despite many warnings – it is seen as unacceptable to spread the wealth. Profits are seen as the natural property of the investor class. This is why JP Morgan criticized the pay rise as a “wealth transfer of nearly $1bn” to workers.

It certainly doesn’t have to be this way, and we don’t need to look backwards to socialism, or any other historical system, as an prebaked alternative. Instead, we need to evolve. The human capacity for innovation and fresh thinking is boundless; why would anyone want to denigrate that capacity by believing that capitalism is the final system we can come up with?

Martin Luther King spoke of a “higher synthesis”, that takes the best of historical systems, draws on this boundless capacity, and creates something new. There is no shortage of ideas. We can start by changing how we understand and measure progress. As Bobby Kennedy said, GDP “measures everything, in short, except that which makes life worthwhile”. We can change that. We can adopt regenerative agricultural solutions to help us to live in balance with the environment on which we all depend for our survival. We can introduce potentially transformative measures like a crypto-currency-based universal basic income that could fundamentally improve the money system.

Measures like these and many others could dethrone capitalism’s single-minded prime directive and replace it with a more balanced logic. If done systematically enough, they could consign one-dimensional capitalism to the dustbin of history.

We need our political and business leaders to go from clinging on to the myth that growth will solve all our problems, to joining the conversations that social movements, progressive forces, and young people like Trevor Hill are having about how we can lay the foundations for a better, safer, more equitable post-capitalist world.

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Economics
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