The EFMD business magazine

The EFMD business magazine

Re-organising the political economy

Re-organising the political economy
Capitalism has not failed, nor is it in retreat. It is just an idea. But, argues Malcolm McIntosh, it is an idea, which in its current form, is in real need of being re-thought.

In 2012, the UN High-Level Report Resilient People, Resilient Planet called for a new international political economy that would include objectives such as sustainable development and welfare issues:

“For too long, economists, social scientists and social activists and environmental scientists have talked past each other – almost speaking different languages, or at least different dialects. The time has come to unify the disciplines, to develop a common language for sustainable development that transcends the warring camps; in other words, to bring the sustainable development paradigm into mainstream economics… That is why the Panel argues that the international community needs what some have called ‘a new political economy’ for sustainable development.” One of the greatest challenges we face in an interdependent, neurally networked 21st century was summed up by a prescient Aristotle several thousand years ago, before we were technically wired:

“In a democracy if you have a small number of rich people, and a large number of poor people, the poor people will try to seize the rich people’s assets. The answer is either reducing democracy or reducing poverty”.

Democracy in Aristotle’s time was not unlike the world today. Only some could vote, only some people had power and the bias was very much in favour of rich men. Today there are those who would reduce or diminish democracy for their own ends and today what we mean by democracy is up for discussion in a world where mass connectivity and participation are matched by total surveillance, instant gratification and systems instability.

Capitalism, like justice, education and freedom, is an idea that cannot and will not go away. It was a term unheard of until the publication of Karl Marx’s Das Kapital in 1867 and was never used by the man often cited as “the modern founder of capitalism”, Adam Smith.

As Marx and Smith were both moral philosophers as much as economists, capitalism is a term associated with the study of political economics rather than what is sometimes referred to as the “science” of economics.

How many times have I been at academic symposia, street demonstrations and in classrooms and been told that “capitalism is in crisis” or that “capitalism is incompatible with equality”? And obversely, there is often a reactionary attack against this “attack on capitalism”.

Re-organising the political economy

See more articles from Vol.09 Issue 02 – ’15.

He has worked at the universities of Warwick and Coventry, and been a Visiting Professor at the universities of Bath, Bristol, Stellenbosch, Waikato and Sydney. He is the author or co-author of numerous books and articles and has been a special adviser to the UN Global Compact and is founding editor of the Journal of Corporate Citizenship.

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