On April 26, 2016 an article titled “A Majority of Millennials Now Reject Capitalism, Poll Shows” appeared in the Washington Post. The article cited a Harvard University survey which polled young adults between the ages of 18 and 29 – the Millennials. The survey found that 51 percent do not support capitalism while only 42 percent supported it. This suggests that today’s youngest voters are more focused on the flaws of the world’s most dominant economic model and of free markets in general. A subsequent survey comprising people of all ages found that older Americans are also skeptical of the benefits of capitalism. The only age group with a majority supporting capitalism were those 50 years old or older. Clearly, something is afoot.
A second data set worth noting is focused on global demographic trends and comes primarily from a lengthy U.S Census Bureau report titled “An Aging World: 2015.” Here are just three of the findings that I think are most relevant:
- The world will by the end of this decade have more people over the age of 65 than it has children under the age of 5. This is unprecedented in human history!
- By 2050, for every 100 working-age (20-64) people, there will be almost 80 children and retirees who will require support. The problem with this is most of the children are going to be in Africa and the arc around the Indian Ocean while most of the retirees will live in the developed world and China.
- China will be the first nation to grow old before it grows rich, a phenomenon that has serious destabilizing implications.
The economic implications of these data are significant and sobering. Economics is the study of scarcity and how it is managed. Since humans first appeared on the scene we’ve managed scarcity by having more children and putting them to work. That is ending. Current world wide fertility trends suggest that most of the world will soon be reproducing at below replacement rates. With shrinking numbers of consumers (the elderly don’t buy and the young are fewer and fewer) and a static amount of goods and services available due to accelerating depletion of finite resources for production the “natural” economic response will be falling prices – deflation. For a global economic model – capitalism – based on and driven by ever increasing consumption and in which success is measured by profit and shareholder return this is a looming catastrophe of epic proportions.
Capitalism as it is currently practiced has to change. Curious about what was behind his initial polling results John Della Volpe, the polling director for the Harvard study cited above subsequently interviewed additional young people to learn more about their antipathy toward capitalism. The findings he said indicated that “They’re not rejecting the concept (of capitalism). The way in which capitalism is practiced today in the minds of young people – that’s what they’re rejecting.”
In my new book Compassionate Capitalism: A Journey to the Soul of Business I and my co-author David Meltzer outline a cogent plan for a different way to practice capitalism. And we do so without throwing the baby out with the bath water. The book chronicles the undeniable benefits of capitalism in a very compelling manner. We also mince no words in detailing where it has gone catastrophically wrong.
What’s exciting to me is the call to action embedded in the book. The linking of an alternative economic model – Compassionate Capitalism – to a life force that pervades the universe takes us back to the original intent behind Adam Smith’s Invisible Hand. It’s a call to action that speaks to the best of who we are as a species – it speaks to the soul that Aristotelian philosophy considered to be the animating or vital force inherent in all living things. It’s a call to action that, if heeded, may just be the antidote to a cancerous malaise that threatens not only our world but us as a species.
The book is due out in late June…be one of the first to get a copy!