21. Is it too late to save capitalism?

Source: the7circles.uk/

Scholars all around the world believe that capitalism will meet its inevitable death in the near future. Jeremy Rifkin, a political advisor, and author predicted, “We are seeing the final trump of capitalism, followed by its exit off the world stage”. A report published by the UN secretary-general says, “Capitalism as we know it, is over”. We are transitioning to a different global economy, whereby the conventional capitalist principles cannot be explained or predicted. 

John Bellamy Foster in “Capitalism has failed- what next’ says that the “world is mired in economic stagnation and extreme inequality in human history”. This is the reason why we have extreme unemployment and poverty. Politically, this has resulted in the near-collapse of democracy and the resultant rise of fascism too. Economists believe capitalism will soon be replaced by an emerging new economic model, which will be based on disruptive technology, perhaps super internet and super communications. This new economic system will also take into account the challenges of climate change and resource scarcity, and the resultant dangers facing the human race. 

In such a situation, what is the role of top multinationals?

Paul Polman, the former CEO of Unilever, one of the largest multinational says, “Our System (Capitalism) is great, but it is not designed to function long term. Capitalism has been the worst form of an economic system- except for all the others that have been invited”. The billionaire founder of the world’s largest hedge fund, Ray Dalio, delivered a similar message, “I’m a capitalist and even I think capitalism is broken’. Howard Schultz, the former chief of Starbucks has also talked about the growing crisis of capitalism. 

The statements by these Global CEO can be considered as radical if we consider their position. This points to several trends. First, the management of big corporates has already recognized the negative influence of populism on multinational organizations. For the first time in years, capitalism’s future is a topic of debate among big corporate institutions. Especially, in the United States of America, the view is that capitalism that had made the country the economic powerhouse of the world is the very reason why the country is in chaos today. This is irrespective of the fact that Donald Trump, the current President of the US is working for the cause of the economic elites. The opposition has managed to create an environment by rallying against ‘the handful of billionaires’. The masses believe in breaking up big multinationals and imposing wealth tax too. 

The 2008 Financial Crisis has already revealed the inherent defects of capitalism as an economic system. Harvard Business School writes, there exists a ‘plaintive wail’ amongst the business community to fix capitalism before it’s too late. Hence it is time that business leaders question the current situation of capitalism. It is time to reimagine capitalism. These top capitalists can change the system by solving the big social and economic problems that have divided society today. Companies can also change their image by working for climate change initiatives, especially those who are directly implicated by the phenomena. It is time for CEOs of big companies to start talking the language of care and concern, to better the human race. If possible, the top CEOs can lead the way to structure a new form of capitalism too. 

All these steps can ensure that challenges that could arise as a result of the demise of capitalism and the disappearance of major corporations, the market system, capitalist institutions could be prevented.