How the Philosophy of the Past Can Help Us Imagine the Economy of the Future

finding the economy of the future 1 5
 It’s more necessary than ever before to re-examine the fundamentals of our economic order. (Shutterstock)

The economy keeps making headlines for all the wrong reasons — stories about rising prices, supply shortages and a looming recession have been frequently making the front page these days.

The current economic crisis is deepening the long-standing issue of social inequality, widening the gap between the rich and poor — a problem that was already accelerated by the Great Recession of 2008 and the economic shock brought on by the COVID-19 pandemic.

The richest country in the world, the U.S., is among the most drastic examples of this trend. Today, American CEOs earn 940 per cent more than their counterparts did in 1978. A typical worker, on the other hand, only goes home with 12 per cent more money than workers from 1978 did.

As a report by the Economic Policy Institute demonstrates, rising CEO pay does not reflect a change in the value of skills — it represents a shift in power. Over decades, American politics has undermined the bargaining power of workers by discouraging and obstructing self-organizing efforts, such as unionization.ealth of a minority at the expense of the majority means power is concentrated in the hands of a few people, mostly men. It’s not surprising that figures such as Donald Trump, Mark Zuckerberg and Elon Musk have a disproportional impact on our communities — sometimes with devastating consequences that threaten our democratic institutions.

Economics with a human face

It’s more necessary than ever before to re-examine the fundamentals of our economic order. The search for alternative economic models, however, is made difficult by conventional thinking patterns.

Many believe we are facing a stark choice between a capitalist market economy on the one hand and a socialist-planned economy on the other.

Although we live in a world that defines economic models in absolutist terms, it doesn’t have to be this way. We argue that the psychological and social perspectives on economy that were developed by 19th-century philosophers such as Georg Wilhelm Friedrich Hegel, John Stuart Mill and Georg Simmel can help us re-imagine economics with a human face.

These thinkers were convinced that a good economic order had to incorporate elements of classic capitalism (such as a free market in goods and services) with elements of classic socialism (such as collective ownership of the means of production). This is what we call economic pluralism.

Hegel and the problem of affluence

Hegel is a good example of an economic pluralist thinker. In his 1820 Philosophy of Right, he presented an extensive reflection on the modern economy. He discussed the market and its operating principles, social inequality and even the formation of desires through advertisements and consumer culture.

Among the many topics he examined was the problem of affluence. Hegel was not just worried about the poverty created by the modern market economy, but also about the concentration of extreme wealth in few hands.


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Writing hundreds of years before modern multi-billionaires arrived on the scene, Hegel already argued that “both of these sides, poverty and affluence, represent the scourge (Verderben) of Civil Society.”

Hegel’s analysis is even more prescient: He believed affluence created the counter-intuitive tendency among the affluent to feel victimized and disenfranchized by society. As a result, the affluent perceived all social demands, like taxes, as unjustified incursions into their personal freedom.

Hegel thought this sense of victimization could lead to an unexpected bond between those at the very top of the economic pyramid and those at the bottom — a bond that overcame differences in lifestyle and mutual antipathy to form an alliance that attacks civil society from both sides. The phenomenon of Trump’s MAGA alliance is an interesting modern example of this.

Re-imagining the economy

Unlike some later socialists, Hegel did not think problems of affluence were best rectified by introducing a planned economy that enforces wealth equality. Instead, his approach was pluralistic.

He made a case for a free market exchange paired with co-operative modes of production, which are — in some respects — similar to modern-day worker co-operatives.

If most economic production in society was organized co-operatively, Hegel believed, wealthier subjects would be embedded in economic decision-making with others, replacing the detrimental “bond of victimization” between the rich and poor with a collective identity based on shared economic agency.

When reimagining our current economic order, we can take a page out of Hegel’s handbook by focusing on worker co-operatives: economic ventures that are co-owned by workers that make productive decisions together, often — albeit not always — in a democratic manner.

Under what conditions are such co-operative modes of production successful? How can the state incentivize these forms of production within the existing market economy? And are these worker co-operatives really a way to achieve economic justice? These are the questions that, inspired by the past, might help us imagine a new, pluralist, more equal and human-centric economic future.The Conversation

About The Authors

Johannes Steizinger, Associate Professor of Philosophy, McMaster University; Helen McCabe, Assistant Professor in Political Theory, University of Nottingham, and Thimo Heisenberg, Assistant Professor of Philosophy, Bryn Mawr College

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Recommended books:

Capital in the Twenty-First Century
by Thomas Piketty. (Translated by Arthur Goldhammer)

Capital in the Twenty-First Century Hardcover by Thomas Piketty.In Capital in the Twenty-First Century, Thomas Piketty analyzes a unique collection of data from twenty countries, ranging as far back as the eighteenth century, to uncover key economic and social patterns. But economic trends are not acts of God. Political action has curbed dangerous inequalities in the past, says Thomas Piketty, and may do so again. A work of extraordinary ambition, originality, and rigor, Capital in the Twenty-First Century reorients our understanding of economic history and confronts us with sobering lessons for today. His findings will transform debate and set the agenda for the next generation of thought about wealth and inequality.

Click here for more info and/or to order this book on Amazon.


Nature's Fortune: How Business and Society Thrive by Investing in Nature
by Mark R. Tercek and Jonathan S. Adams.

Nature's Fortune: How Business and Society Thrive by Investing in Nature by Mark R. Tercek and Jonathan S. Adams.What is nature worth? The answer to this question—which traditionally has been framed in environmental terms—is revolutionizing the way we do business. In Nature’s Fortune, Mark Tercek, CEO of The Nature Conservancy and former investment banker, and science writer Jonathan Adams argue that nature is not only the foundation of human well-being, but also the smartest commercial investment any business or government can make. The forests, floodplains, and oyster reefs often seen simply as raw materials or as obstacles to be cleared in the name of progress are, in fact as important to our future prosperity as technology or law or business innovation. Nature’s Fortune offers an essential guide to the world’s economic—and environmental—well-being.

Click here for more info and/or to order this book on Amazon.


Beyond Outrage: What has gone wrong with our economy and our democracy, and how to fix it -- by Robert B. Reich

Beyond OutrageIn this timely book, Robert B. Reich argues that nothing good happens in Washington unless citizens are energized and organized to make sure Washington acts in the public good. The first step is to see the big picture. Beyond Outrage connects the dots, showing why the increasing share of income and wealth going to the top has hobbled jobs and growth for everyone else, undermining our democracy; caused Americans to become increasingly cynical about public life; and turned many Americans against one another. He also explains why the proposals of the “regressive right” are dead wrong and provides a clear roadmap of what must be done instead. Here’s a plan for action for everyone who cares about the future of America.

Click here for more info or to order this book on Amazon.


This Changes Everything: Occupy Wall Street and the 99% Movement
by Sarah van Gelder and staff of YES! Magazine.

This Changes Everything: Occupy Wall Street and the 99% Movement by Sarah van Gelder and staff of YES! Magazine.This Changes Everything shows how the Occupy movement is shifting the way people view themselves and the world, the kind of society they believe is possible, and their own involvement in creating a society that works for the 99% rather than just the 1%. Attempts to pigeonhole this decentralized, fast-evolving movement have led to confusion and misperception. In this volume, the editors of YES! Magazine bring together voices from inside and outside the protests to convey the issues, possibilities, and personalities associated with the Occupy Wall Street movement. This book features contributions from Naomi Klein, David Korten, Rebecca Solnit, Ralph Nader, and others, as well as Occupy activists who were there from the beginning.

Click here for more info and/or to order this book on Amazon.




 

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