Winston Churchill once described democracy as “the worst from of government, except for all the others”. Many would describe capitalism in a similar manner.
At its heart, capitalism functions by allowing trade and industry to be controlled by individuals, rather than the state. This system recognises that the state might not actually represent its people well as a collective, and allows for an accumulation of personal wealth.
That is to say: in a capitalistic society you don’t have to be born rich; you can become it. To hear you’re living in such a society is exciting for an investor – again, this is a role one can only adopt under capitalism.
Capitalism, an economic system that was once synonymous with exciting phrases like “personal enterprise,” “free market,” and “booming industry,” has become the new “bourgeoisie” – in the Marxist sense.
Wealth, sadly, cannot exist without poverty; otherwise it would be meaningless.
This is the biggest criticism of our current economy: that it encourages a gap between the rich and the poor and thereby actually, actively creating poverty.
It wasn’t always like this.
The Glory Days of Money
The growth of globalisation hand-in-hand with capitalism means that the best of our monetary system has never been felt by the whole world at once – first it was the US, and then in the 70s and 80s it hit the UK and the Commonwealth at large.
The prize-winning economist Milton Friedman – who rose to prominence during the 1980s and remained a hugely influential force until his death in 2006 – was a libertarian and massive proponent of capitalism. He pointed to Hong Kong in the 1990s as the free market at its best.
What made capitalism great, and inspired people like Friedman, was that it – in theory – allowed everyone the opportunity to pursue wealth. Every individual could become rich without an inheritance, and every nation could support its people without producing everything at home.
Of course, Friedman was and is still criticised by several illuminated peers – but the dangerous, modern flaws in our economic system have only been picked up since Friedman’s heyday of the 1970s. Before that first big recession in the 80s, there was no doubt in anyone’s mind that the pursuit of health, wealth, and happiness was an inalienable right.
What Can We Learn From The Free Market?
Unlike many capitalists, we don’t believe that the goal of every individual and every corporation is to maximise profit. We believe you should be able to accumulate personal wealth without feeling guilt that you are creating a corresponding poverty.
By applying ethical investment indices and compulsory corporate social responsibility to our current economic system we can create a new one; one that’s truly by the people, for the people.
One of the founding tenets of capitalism is that the majority of services are owned privately, not publically. The main criticism of this system is: although the wealthy make very pretty trains, they’re also too expensive for the poor to ride. This stops the poor from travelling to work, and therefore accumulating wealth with which to ride the train.
If the means to help the poor accumulate wealth is in the hands of investors, then there is something that can be done without an any kind of apocalyptic, post-capitalistic scenario: ethical investment.
Ethical investment in the right places puts pressure on corporations to be socially responsible; to ensure the health and happiness of the workers, environments, and communities they affect.
Can We Make Capitalism Great Again?
There is an argument that such a thing as “peak capitalism” exists, in the same sense as “peak oil”; we have taken the most from it that we can and everything is unsustainable and downhill from this point on.
Even if true, this doesn’t mean we have to cast aside any economic knowledge gained from our flirtation with excess: we have learned that money – or capital – is, in all its forms and values, a tool of persuasion and a means of growth. What we do with it now – our investments – will shape whichever post-capitalistic world arises.
Before we ever get to that point, though, it’s possible to reach this compromise, whereby companies don’t have to sacrifice profits to save those dependent on them.
Ethical investment: because no economic system is perfect without incorporating a social one.