Capitalism is often espoused as an economic system that liberated people from Serfdom. Linear models of history tend to place it after Feudalism as the most free of social models. Fukuyama even went so far as to say it marked the end of history.
And yet when we compare 2011 with 1848, which looks more revolutionary? Neither resulted in the overthrowing of existing theories. Both spread ideas far and wide. And 2011 was a lot bigger! So if we assume that 2011 and Occupy was largely about Capitalism then it seems that many are far from happy with the amount of freedom that they have.
Your immediate thought may be that people are unhappy because of the Great Recession. At this moment there are more 16-25 year olds in the world who aren’t in education or work than there are citizens of the United States. These people clearly have reason to think that the system let them down. But what about those protestors with a job? What about those who wanted to protest but feared that they could be fired for doing so, or that they were working so much that they didn’t have time to protest? Movements as big as Occupy don’t result solely from recessions, no matter how big they are.
This now brings me to my main point. I saw a Dilbert cartoon some months ago, and it stuck in my head. Dilbert kept looking at various animals kept in captivity, each time deriding them for their stupidity in allowing themselves to be virtually enslaved. And then in the last strip he went to sit in an office booth and tapped away on a keyboard; a slave, or so we are to think, of a faceless corporation.
Capitalism says that it permits labour freedom of movement, so they can work where they want. But critics say that Feudalism at least protected one from being fired and/or unemployed. And of course you are only free to choose where you have a choice. Where’s your freedom to quit if you know that there aren’t any other jobs out there? After all how many people have you met who work in their dream career? How many people have you met who work for who they want to work for? In a Capitalist system you generally need capital in order to be your own boss.
So what is it that we have right now? Freedom of labour movement? Freedom to choose which company you enslave yourself to? Or worse still rigid slavery to an entire system that we cannot escape, and serves only the 1%? Are you truly free? Or will our grandchildren look back on these times with pity?
We have 3d printers, cars that park themselves, iPhones and apps, and advances in robotics. At 7 billion there are more of us to create and innovate than ever before. And yet this week the Economist’s main article is highlighting the number of scientists who think that we’re not only in an economic recession but also a recession of innovation, invention and creativity.
Given that one of the premises of a book that I’m currently writing is in fact the opposite (that we’re living in a creative revolution) I immediately sought to challenge their article. But what do you think?
I recently took part in an innovation rally. It was said there that a) few financial firms manage to get intro Forbes list of innovative firms, and b) that it was an achievement that 50% of this firm’s (statestreet) employees think innovation is essential. However this means 50% don’t think this, and is this not in fact the reason financial firms struggle to be innovative?
What’s the single most valuable resource on the planet? Human capital. The firms that find ways to tap into the cognitive and creative surplus of their employees over the coming decades will be the most successful ones. Because these firms will be making the most efficient use of that valuable resource, empowering people throughout the organization and presenting as many people as possible with genuine opportunities to innovate.
Do you agree with this analysis? And if so how can today’s firms more effectively and efficiently innovate?
You may have heard of the Clash of Civilisations between the West and the East. But what might have slipped you by is that there is far more evidence for a clash between people and business – a global clash, but one that will happen within rather than between countries. In recent years global growth has far outstripped GDP growth. Multinational corporations are gaining more and more power by the year. In fact it’s one of my many ideas for a novel; to implicitly parallel the growth of businesses and power of CEOs with the growth of Roman Legions and power of Generals like Caesar. You can probably guess where the novel would go if I ever get round to writing it. But where will reality go?
We don’t talk about a clash not because it’s not there, but because people are taking this lying down. In the latest budget the UK Coalition announced that it was slashing taxes for businesses, and saving money by taking away benefits for the poor. This is in the people’s interests it is claimed, as businesses bring jobs. But hold on, since the 1970s businesses have shifted from a ‘Retain and Reinvest’ model of corporate governance towards a ‘Downsize and Distribute’ one, which has meant much higher unemployment, declining real incomes, and a growing rich-poor divide. Only Germany that I can think of, insists on its businesses valuing employee wellbeing as well as profits
People are frustrated and feel under-valued all the way around the world. We can see this simply in the fact that the protestor was named 2011’s Times person of the year. And Occupy, the biggest protest movement worldwide, is not really protesting against governments so much as it is against businesses. Governments say they can’t do anything about it. But I say we must. It is not people we need to fight against. It is systems. And today we have made some pretty big systems, which actually fight against the wellbeing of the people!
What are your thoughts?
The global recession has resulted in numerous strikes around the world. On June 30th there will be public sector strikes in the UK, and up to a million people are thought to join in. Yet there are strong voices and arguments both for and against the strikes. And that argument should most certainly be had. So what do you think? Are strikes justifiable in the midst of these cuts?
Our global economy is still recovering from the collapse of the US housing market and the ensuing credit crunch. And in the past 2 years prices of many essentials such as food, energy and basic commodities have doubled. Is this due to fundamentals? Or is this the latest sign of more ‘bubble trouble’?
Economic growth is a new concept, existing on a global level only since the Industrial Revolution. So what makes us think we can keep driving ever onward and upward if so little of history suggests we can?
Indeed much of our growth has been based on our imagination and creativity. But is man able to create anything entirely new? Try it now and you’ll find that what you think of in fact adapts something else that already exists. The greatest example in human history is the wheel. But that too we could have derived from a stone or a piece of fruit rolling down a hill, or perhaps more likely a log.
In addition, countries like China are able to grow fast because they are playing ‘Catch-up economics’. This occurs where new ideas, capital and technologies are being adapted/taken from abroad. Yet if the paragraph above is true then aren’t we all just playing ‘catch-up’ with nature? If we can’t ever think of anything new then we can only ever advance as far as nature allows us too. Right? Or wrong?
>”The biggest single challenge facing the Earth…is not global warming. That is a secondary challenge. The primary challenge facing our species is the reproduction of our species itself.”
Boris Johnson, The Telegraph
These are the forecasts for population growth up until 2050. The world’s population growth rate peaked in the early 1970s. The global population doubled from 3 billion in the 1960s to 6 billion in mid-1999, and continues to rise — but at a slower rate. The question is where on that chart above should we draw a line, saying ‘population must not exceed!’?
>Pre-recession China was an export dependent country, which was growing so fast that it was at risk of overheating. It was considered to be dependent on the US buying all the Chinese goods too. Since then the US has suffered its worst recession since the Great Depression, and aggregate demand has slumped. So why and how is China booming again?
There are 3 possibilities:
- The US private level of debt is still rising, along with consumption
- Not true. The US entered recession with household levels of debt at 130% and have now lowered them to below 100%. Unless the rich is making up for the rest of society’s shortfall in consumption then it seems obvious that falling income and falling debt means China is not increasing sales in the US.
- China is selling to other countries instead.
- Chinese companies are certainly trying o open up new markets in other countries, but can they do it within a few months? The richest peoples in the world are now in recession, so it’s unlikely that anyone was able to fork out for the big deals.
- China managed to switch from an export led country to an import based one in the space of a year.
- There are examples of firms that have been trying to do this e.g. Chinese automakers. But this kind of change in an economy takes generations, not months. So China has not become an import based country.
- China used its stimulus to buy and stockpile Chinese goods in the hope that the recession would be temporary, and will not be able to maintain these efforts for long.
If this isn’t scary enough (please do suggest other possibilities) there is also a real estate bubble in China, which China is struggling to suppress.
And that’s without getting into the policy debate in the West. Though I will ask you this: are there any more products/assets to bubble? First there was the dot.com boom; then the real estate and mortgage boom. Is there anything left to bubble? Will the next things to bubble and burst be commodities, and metals like gold?
What do you think?