Building the sustainable economy of tomorrow is going to require a little ingenuity, and a lot of ideological TNT
If I were to hand you a suitcase full of glittering gambling chips and give you a seat at the grand game of economic destiny, here are some bets you probably would not make. That the quantity of nature’s plenitude is going to magically multiply, the constraints on nature’s bounty vanish and, hence, its price dwindle; that the power of the people formerly known as consumers is, in a hyperconnected world, likely to shrink; that the information you once called “top secret” will continue to be, especially from those you’d least like to see it; that as societies with already threadbare pockets grow more aware of the hidden costs of and subsidies to an industrial-age economic engine (quick: how much does a fast-food burger really cost?), they’ll merely yawn, shrug and continue to opt not to begin righting the balance. And, finally, you probably would not wager that, in the face of what you might call existential threats to business as you and I know it, tomorrow belongs to those whose mightiest ability is merely to continue to practise, live and breathe the rusting precepts of an aging paradigm. No, the wise among you would bet that tomorrow belongs to those who have the hunger, insight, and perhaps even the wisdom to master the art of transcending their own limitations and begin surmounting the novel, perhaps lethal challenges of the world we live in.
Hence, while yesteryear you might have heard talk of rebooting or even rethinking capitalism, it might be just a touch harder to do so today. And in case you’ve been living on Mars recently, today’s suggestions that capitalism is at the juncture of historic transformation aren’t just coming from long-time critics and adversaries, but from practitioners and luminaries. In the McKinsey Quarterly, Paul Polman, Unilever’s CEO, has discussed what he calls “long-term capitalism.” No less an eminence than Michael Porter, the dean of corporate strategy at Harvard, has pronounced the need to “reinvent capitalism.”
So can the practice of capitalism—the art of being a capitalist—transform as radically over the next few decades as it did during Adam Smith’s era? I believe it can, and I believe more vitally that all of us will change it. I believe not just that we’re already standing atop the cliff, but that some of us are already taking a quantum leap to the other side. What, then, lies across the gap—the gap where the challenges above, like monsters of yore, twist and hiss?
Before we get there, consider, first, what lies on this side. Alfred Chandler, in his masterwork, The Visible Hand, painted a detailed portrait of what he termed “managerial capitalism”—a global economy powered by behemoth, globe-straddling bureaucracies we today call multinational corporations. From Milton Friedman to Niall Ferguson, a generation of scholars has detailed—and explored—the rise of “financial capitalism”: a global economy pulsating with a dense web of markets and networks, where traders and bankers are the technicians of the engine. In its heyday, given the explosive rise of prosperity globally, I’d bet we all know that managerial/financial capitalism was a great leap beyond the purely industrial capitalism that preceded it. Yet, I’d bet we also know: that the engine’s running out of steam, we’ve entered an Age of Dilemma, and the dismal choices of the dilemma can be summarized, regardless of title, location or ethical predilection, as follows: more profit means more harm to the planet, the people that live on it, their neighbours, not to mention maybe even your society, your grandkids, and many of the things that matter most to anyone who’s got a soul slightly more developed than either Hannibal Lecter or a zombie overlord.