The Need To Re-Think Capitalism

Hedge fund manager and philanthropist Paul Tudor Jones II challenges American businesses to incorporate “justness” and ethics into their corporate model. A self-described lover of capitalism, he believes that the economic system has lost its way and is becoming corrupted by greed and a lack of social responsibility — hardly a novel observation, but definitely an interesting one to hear from a wealthy beneficiary of said system.

His ten minute TED Talk below is highly informative and dense with charts and data showing just how much the nation’s business elites have become out of touch and self-serving.

Jones II’s message appeals to both self-interest and compassion: his contention is not only that it is more ethical to utilize vast profits to do more social good — through corporate charity, better wages, etc. — but that making capitalism fairer and more beneficial to society is the only way to prevent less desirable (to capitalists) alternative means to that end — namely higher taxes, revolution, and war (implicitly socialism or some other Leftist movement would be a threat, but it would allegedly operate through any or all of those).

It would indeed be in the best interests of business elites to share at least a fraction of their ample capital to the many workers who helped make it possible. Setting aside ethics — the lack of which seems all-too acceptable in U.S. business culture — it is both intuitive and empirically affirmed that better-paid employees are more productive, display higher morale and thus lower turnover, and have more disposable income with which to acquire the goods and services these companies provide.

And again, if companies and business owners have the wealth, why not devote a higher percentage of it to do some good in the world? If libertarians and conservatives want a world where government isn’t forcing companies to pay higher wages, pay more taxes, and implement tax-funded welfare policies, why do they not make it incumbent upon private sector actors — especially the most powerful and well-resourced — to prove to the state that they can behavior ethically and beneficially without public and political pressure? If it is up to us and not the government to make a better world, why not start with those that have the most sway on the matter: employers, investors, and small percentage of Americans who disproportionately influence our economic lives?

Going back to Jones II’s point, I can definitely sympathize with the idea that capitalists need to work towards a more ethical, fair, and socially responsible economic system. However, I remain skeptical that this can ever be done on a widespread level. While we can point to a good number of examples of generous companies and business owners, by and large these remain the exception rather than the rule (as the video’s charts make distressingly clear). Throughout history, the bulk of any society’s rich and powerful remained venal, greedy, and exploitative at their leisure if or until forced their hands were forced by any or all of the threats Jones II highlighted.

The tragically prevailing historical fact up until this point is that people in high places, on the whole, do not care about the rest of society. There will always be a few exceptions, always a few attempts on the part of some elites to cajole their fellows to behave better. But for various reasons — ranging from self-selection process (only the most ruthless reach the top) to biology (an abundance of wealth has been found to cloud moral judgement — appeals to better nature just never catches on.

I am not saying that all capitalists are inherently evil or that reform efforts likes Jones II’s are lost causes; I think it is extremely valuable to apply public and political pressure on the rich and power to get their act together. But the system as a whole just doesn’t seem amenable to any meaningful, long-term change from within. The culturally ingrained focus on accumulating vast amounts of profit for its own sake — more money than anyone could possibly do anything with — while so much of society’s needs go unmet for alleged lack of resources, just doesn’t seem like it can be squared with altruism, or indeed reason (I see little rationality, to say nothing of morality, in hoarding so much wealth in the face of vast poverty and immiseration).

Given all that, can capitalism truly be reassessed and reformed? Is it in the nature of the system or its most willing participants and beneficiaries to by and large change for the better? Many commenters on the video have noted that inherent contradiction between the business values of wealth at all cost and diverting even some of that wealth to morally just yet unprofitable ventures. Can capitalism and its subsequent business culture be separated from this central focus on competition, wealth accumulation, and other values at odds with altruism, generosity, and social concerns? Perhaps some would even take issue with this characterization of capitalism. Please feel free to weigh in.

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