WHAT COMES AFTER THE END OF CAPITALISM? (Sunday Sermon)

From Richard Metzger at DangerousMinds:

Noam Chomsky has long advocated simply reading the Wall Street Journal if you wanted to understand the mindset of the ruling class. No special detective work is necessary to divine the attitudes and intentions of the rich and powerful. In the pages of their house organ you could find what you were looking for, often with unvarnished bluntness.

It’s good advice, but today, the WSJ isn’t the only place to look for hints of ruling class attitudes. In a column published today at Huffington Post, Dr. Klaus Schwab, the founder and executive chairman of the World Economic Forum poses a salient question: If this is the end of Capitalism, then what’s next?

One of the criticisms of capitalism centers on the widening gap between winners and losers due to the so-called turbocapitalism that is a result of global competition. In this context, the so-called Nordic model demonstrates that a high degree of labor market flexibility and social welfare systems do not have to be mutually exclusive—indeed, they can actually be combined to very good effect. This type of economic policy also enables countries to invest in innovation, childcare, education and training. The Scandinavian countries, which underwent a similar banking crisis in the 1990s to that which we are now experiencing in other Western economies, have shown that by reforming regulation and social welfare systems, flexible labor and capital markets really are compatible with social responsibility. So it is no coincidence that these countries are now among the most competitive economies in the world. [Emphasis added]

Other aspects of the criticism of capitalism that are worthy of serious consideration are excessive bonuses, the burgeoning market in alternative financial instruments and the imbalance that has emerged between finance and the real economy. However, we do see some progress in these areas thanks to mounting pressure from the general public, governments and also the market.

So even though capitalism was not laid to rest in Davos, it is fair to say that capital is losing its status as the most important factor of production in our economic system. As I outlined in my opening address in Davos, capital is being superseded by creativity and the ability to innovate—and therefore by human talents—as the most important factors of production. If talent is becoming the decisive competitive factor, we can be confident in stating that capitalism is being replaced by “talentism.” Just as capital replaced manual trades during the process of industrialization, capital is now giving way to human talent. I am convinced that this process of transformation will also lead to new approaches within the field of economics. It is indisputable that an ideology founded on personal freedom and social responsibility gives both individuals and the economy the greatest possible scope to develop.

If this is the sort of intellectual currency that was circulating around Davos this year, I think this is a pretty strong indication that the Occupy backlash is having a big effect. You’d hope that by now the elites must know that the natives are restless!

Obviously a worldwide group-mind consensus is demanding, if not exactly the end of Capitalism, certainly a major rethink/reformation of the way it is practiced in the 21st century. The world is a different place than it was before the Industrial Revolution, it’s high time we updated the operating system to reflect those changes.

It’s just getting to be so fucking stupid, isn’t it?

Michael E. Porter, a Harvard University professor cited by Schwab in his essay, explains why business leaders must focus on “shared value creation.”