“Our destructiveness has not been, and is not, inevitable. People who use that excuse are morally incompetent, they are cowardly and they are lazy. Humans don’t have to live by destroying the sources of their life. People can change; they can learn to do better. All of us, regardless of [political] party, can be moved by love of our land and to rise above the greed and contempt of our land’s exploiters” Wendell Berry.
After I returned from my sabbatical in 2010 I was called in by my university provost and asked to plan and implement a new degree in sustainability. When planning new courses, I knew that one had to be “Sustainability and Economics.” I planned it using professor colleagues, one with progressive thinking from the business school, and two from economics (one of whom later volunteered to co-teach the class with me). When I offered the class, many business students would enroll in it as an elective since the business school would not recognize it as a basic course for their students. A common comment I got from many of these business students was, “why aren’t my business professors teaching me these alternate options of business and economics? …we aren’t being properly prepared for the market challenges or sustainability thinking of the 21st century.”
In order to change the system, we need a reality check on how this system we have all accepted as ‘normal’ is failing all of us. At the root of everything that is happening in the world today can be traced back to our current economic market driven system and how the global markets are set up and designed to distribute resources we all need, and then all want (luxuries and comforts beyond our basic needs). Current markets are about buying and selling and ownership. Our current market economy is about commodifying everything with individual ownership as a primary consequence. This has led to the mindset of hyper-consumerism and the perceived freedom of “Í wanna do, what I wanna do, when I wanna do it” mentality. I say perceived freedom because a further consequence of this is being trapped in a debt-based system.
When you are in debt, you are not free. Your whole world revolves around making enough money to allow you to keep your ‘stuff’ – your property! Hence money becomes the metric by which success is measured. This thinking promotes greed, antipathy, hoarding, and general indifference to social justice. Fear of losing that precious money dominates ones thinking. You can never have enough money because there might always be a market failure that diminishes your money or even bankrupts you into poverty. Being thrust into poverty in our global market economy means to struggle alone – another consequence of how this debt-based individuation is set up to control you by promoting separateness.
I’ll call it the modern American dream, even though it has infiltrated and corrupted global thinking. This dream stipulates that anyone can be a big financial success if they work hard enough. As such, being your own boss as a small business owner is a primary step in the ladder of success of this dream. If only it was that simple. My Wendell Berry quote from my last post emphasizes the problem of this hard-work belief nicely, “If hard work made you rich, every farmer would be a billionaire. But they are not because the system does not reward labor, it rewards leverage. Modern Capitalism is about exploitation, not effort.”
(In economics, capital refers to the assets that are used to produce goods and services, which can include physical tools, equipment, and facilities. It is essential for increasing productivity and generating income, as it allows businesses to create [monetary] wealth. Capital can take various forms, such as currency, machinery, and even human resources.)
The ability to run your own business requires capital. The ability to keep it going requires capital, usually in the form of profits. Whatever product or resource you are providing requires customers. To reach those customers requires capital for advertising. Unless you have a uniquely individual product, you are in a struggle from competition that can undercut your profits. Larger businesses than yours can afford to undercut your profits even if your product or service is superior. Unless you use only your own efforts and/or those of family as partners willing to share the risk you will need employees. That requires higher profits and more capital. Customers are fickle and unpredictable as is the demand for what you provide. Regardless of your personal ethics, you are required to compete in a cutthroat system – market-oriented economics – that lacks empathy and even encourages antipathy.
“The Walmart Effect is a term used to refer to the exploitive economic impact felt by local businesses when a large company (like Walmart) opens a location in the area. The Walmart Effect usually manifests itself by forcing smaller retail firms out of business and reducing wages for competitors’ employees. Many local businesses oppose the introduction of Walmart stores into their territories for these reasons. Much of the Walmart Effect can be attributed to Walmart’s immense buying power. The Walmart Effect can also affect suppliers, who must drive their production costs down in order to afford to sell to Walmart” Investopedia.
(Modern capitalist society is a term used to describe a type of capitalist society in which a capitalist class of “new elites” and “old elites” concerned with maximizing their wealth secures a political system that serves and protects their interests, leading to the development of a wage-earning class). It’s a ruthless business world. How ruthless you might ask? According to start-up failure statistics (see link) a summary of the negative outcomes are:
- The failure rate for new startups is currently 90%.
- 10% of new businesses don’t survive the first year.
- First-time startup founders have a success rate of 18%.
- The average cost of launching a startup is $3,000.
- Investors predict similar failure rates for AI startups
- Payroll is one of the highest costs a business incurs.
- 34% of small businesses that fail lack the proper product-market fit.
- 22% of startups that fail don’t have a sound marketing strategy.
- The average venture capital firm receives more than 1,000 proposals per year.
There are exceptions, but they are disruptors that change the rules of this ruthless game and use a different model of capitalism. Two such models I covered in an early post (see link) are B-Corporations, and the Place-Based-Network-Model that describes how businesses can move to become transformative socially responsible businesses.
While corporate social responsibility is a great step in the right direction, it is still a tweak of the existing system that thrives on a misguided Darwinian interpretation of ‘survival of the fittest’ mentality in which competition at the expense of others is encouraged. That term – competition – is so engrained within us as an absolute that we never consider whether it is understood in a way that explains how we naturally are meant to live. Competition when it is used to build group cohesion from a collaborative perspective – such as in team building exercises – is good. There are no winners or losers, just interactions that help to improve ourselves. However, when used as a winner-takes-all competition where the losers are socially traumatized, is really destructive to social cohesion. It is no better than disaster capitalism (see my post about this) where no-crisis goes wasted by the hierarchical powers to curb our freedoms further. Negatively competitive and exploitive businesses use this as a way to create cycles of crisis, exploitation, and privatization.
Governments and corporations love privatization. They claim that it increases efficiency and removes inefficient bureaucracy. But like negative competition all it does is give unscrupulous businesses another monopolizing way to create even more profits for themselves (and their corrupt political allies). To break out of these negative economic cycles controlling us, we have to return balance, fairness, and collaboration to our economic systems. we have to return to the idea of the public commons and localized economies.
To Be Continued …………….
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