Capitalism’s New Political Role

Capitalism must show the way to a new political order.

Articles contemplating capitalism’s future abound. The role of capital in wealth creation has been critical and successful. Not everyone is wealthy but vast numbers of people in the world have been lifted above the poverty line in the last few years. The middle class – those able to afford more than survival spending – is now massively bigger than it was.The process has increased the gap between the rich and the very poor with the distressing impression that capitalism has somehow failed. It hasn’t – it has just failed some people, albeit still a significant number.

The process of creating a bigger middle class, while largely economic, has been partly political. Voters have, as always, voted for politicians who they think will make them richer. When only a few are rich the process is exclusive, keeping the poor, poor. When a large enough number become middle class the process changes in favour of supporting that group. In the process it increases the size of the middle class, bringing more out of poverty.

The politics of selfishness will always make people aim to be better off. It is natural that it should. Once the group of better-off people gets big enough the same tendency will extend to more people, though perhaps not to everyone and perhaps not as quickly as the previous step. Wealth creation and wealth distribution is moving in the right direction notwithstanding the excesses of the super rich and the crass wages of the few who head up the biggest companies. Not all is right in the world of capitalism but more is right than is being acknowledged by voters.

In the process, capitalism has become more powerful. The days of great power in the hands of a few industrialists are over, replaced by power in the hands of the big corporations, especially the biggest six – Microsoft, Google, Amazon, Apple, Facebook, Berkshire Hathaway. Demonstrably these giants have political clout far greater than most, if not all, political parties. But there are many other corporations beyond this group that wield considerable power, and do so with less noise and drum-banging. Together these big industrial companies have much more say about society’s future, the planet’s survival and the uses to which Artificial Intelligence will be put.

They may not be politically sensitive but the corporations concerned know their clout and are well aware of the declining power, and, I think, shrinking intellect of most politicians. If you want a demonstration of my point spend another five minutes looking at the British House of Commons, or imagine a comic as President of a sensitive near-Russia State. Not all politicians are daft but the number who can be considered strategic leaders is declining fast. A tendency to elect buffoon politicians speeds up the process of self-destruction.

The vacuum so created will be filled by capitalism. Already companies are realizing that the concept of Corporate Social Responsibility (CSR) is vastly different from the enthusiastic but amateur early attempts at it. Spreading a few well-meaning dollars in the hope that the attendant Public Relations will somehow justify the cost is not what capitalism’s power is about. Already major capitalists are taking steps, individually and collectively, to determine the survival of the planet, to control the abuse of the new media and to moderate the spread of indecency in order to maintain humanity’s greatest gift, humanity itself.

Economic issues remain important but Social issues now dominate the political scene and they are force majeure being determined swiftly by corporations rather than lugubriously by parliaments. Will these giants of influence work for humanity’s benefit or simply to perpetuate their own power and wealth? To imagine that they have some moral agenda is naive. Any morals they display are forced upon them by events and the threat of being legally broken up, a process more difficult than it sounds. The big card is their need to keep a consumer base that will choose their products. While considerable tracking and analysis gives them the power to influence, the consumer is being educated at the same time, even if not at the same pace.

We have the forces of education, public pressure and legislation available to enforce better management by Capitalism. Used properly, they will be enough.

Pressure we (ought to) exert on our politicians should now be directed to our Capitalist Leaders.

They are the people who can rescue the world.