Almost ten years ago, journalist and author Naomi Klein asked me whether capitalism can be sustainable. I responded by citing a mountain of data arguing that indeed it could be. I now realize, she was being rhetorical and I was being obtuse.
What follows are the confessions of a reluctant capitalist and the journey that turned me into an advocate of radical change.
As a young man, I acknowledged capitalism’s many deeply entrenched problems. I realized it is premised on the persistent destructive legacy of colonialism. I also understood that capitalism is the driving force behind environmental degradation. However, I believed the structural weaknesses of our economic system could be mended. I thought market efficiencies could be gerrymandered to help us reduce pollutants and slow biodiversity loss. I believed that with the right regulations and the right inputs, capitalism could be leveraged to help restore the natural world rather than destroy it. I thought that with the right combination of carrots and sticks, we could incentivize change and disincentivize destruction.
I made this point for years by highlighting the economic gains associated with a green economy as well as the benefits, and opportunities associated with climate action. I would extoll the virtues of the jobs being provided by the green economy. I applauded banks that distanced themselves from fossil fuels. I even bought into the promise that SDG-focused private equity firms could help finance an environmental and social revolution.
I had hoped that we would adopt an inclusive, socially responsible economic and political philosophy known as conscious capitalism. More than anything, I hoped that the overwhelming logic and the economic incentives associated with sustainability, would revolutionize business and change our economic priorities. I hoped that capitalism would be transformed by sustainability and that businesses would not be able to avoid the gravitational pull of the “sustainability megatrend“. I hoped that this would be the leading edge of a shift in our collective consciousness that would help us to be more just and equitable.
I thought that the costs of inaction would force us out of our complacency. I believed we would integrate the impact on nature into the price of goods and services. I hoped that we would stop seeing these costs as externalities and common sense would put an end to short-term thinking.
I supported my case by highlighting how climate change and biodiversity loss were central themes at the World Economic Forum (WEF) in Davos. I followed hundreds of sustainability-focused events and I listened to countless impassioned speeches and lofty prognostications, I supported responsible business organizations like Ceres, CDP, RE100, Global100, global RepTrak 100 and We Mean Business. I was particularly interested in B-Corps and their efforts to reform capitalism.
I would highlight “green companies” and I would celebrate companies that support clean energy. I was involved with SRI and impact investing and I tracked the performance of companies on sustainability-focused exchanges like the FTSE 100 and the Dow Jones. I would celebrate the efforts of sustainability pioneers and companies like Interface, HSBC, Unilever, Mars, and Ikea.
While I repeatedly highlighted the actions of truly great companies like Patagonia, I realized that this is not reflective of where most businesses are at. For every company that is genuinely working towards sustainability, there are literally thousands of companies whose sole aim is to increase profits.
For far too many companies, sustainability claims are little more than greenwashing (eg Volkswagen). There are also many companies whose conduct can only be described as the embodiment of evil. The fossil fuel industry is the cause of climate change and the reason we have not acted to address it. Big oils deceit and corruption is a matter of public record. Exxon Mobil and the whole fossil fuel industry are rotten to the core. They are the leading source of both pollution and environmental destruction while at the same time, they are actively involved in campaigns of disinformation to mislead the public.
Capitalism cannot secure the required changes
While I wanted to laud “waves of corporate goodness,” I was confronted with networks of deception that have had disastrous effects. Disinformation from fossil fuel companies and conservative politicians has undermined the facts about climate change and delayed action. For this reason, I argued that disinformation is the most pressing global sustainability issue and I explored the ways it corrupts politics and politicians. I have also developed governance arrangements to combat disinformation.
However, my research led me to the understanding that the subversion of facts, science, and reality is not some twisted perversion of capitalism, it is a natural outgrowth of a system that is focused on competition, profits, and growth. Disinformation is good for corporate earnings and shareholder returns. Deceit and pseudo-science that cast aspersions on the facts is rewarded by capitalism.
Even though I continued to refute the economic arguments used to torpedo climate action and presented research that conclusively supported the economics of climate action, I began to understand that the problems are deeper than I realized. I wrote about the need to end fossil fuel use and transition to renewable energy and nuclear power. I also did extensive research and reporting on carbon removal technologies, but facts don’t seem to sway people and politicians.
I have railed against lending institutions that finance fossil fuels and organizations like ALEC that kill climate action and advance corporate interests. I supported efforts to replace GDP and I exposed the perils and the illusion of growth. My views began to shift when my efforts to understand the psychotic preoccupation with growth led me to the conclusion that it is deeply rooted in capitalism.
I analyzed the relationship between different economic systems and the SDGs and I explored how 10 different types of economies contribute to or detract from the SDGs. This research combined with a literature review of ecological economics made it impossible for me to believe that capitalism could ever do what I was hoping it would.
Capitalism is fundamentally flawed
My lived experience and extensive research both inside and outside of academic settings have forced me to realize that we cannot goad capitalism into combating climate change and stemming biodiversity loss, I have come to a point where I can no longer ignore the incontrovertible evidence indicating that we are not doing what we must. Nor can I find a reason to continue to hope that we could ever do so within the existing system.
The evidence strongly supports the conclusion the capitalist system is not capable of steering us away from the precipice. It is the reason we are where we are today and if we let it, capitalism will push us over the cliff.
I now realize that corruption, corporate malfeasance, disinformation, and all the organizations and institutions that defend the interests of polluters, are logical outgrowths and inevitable by-products of a broken system.
Our entire economy is premised on increasing both profits and growth, which is at odds with efforts to respect planetary boundaries. This is evidenced by the fact that under the current system, CEOs have a fiduciary duty to deliver profits and companies dismiss environmental and social concerns as externalities. It is hard to escape the realization that the core tenets of capitalism are fundamentally at odds with social and environmental well-being.
Capitalism’s broken assumptions and broken thinking
I have come to realize that the change we need is unachievable within the current system. We cannot tweak capitalism to make it work, we need a new system. Mainstream economics makes it hard for us to even imagine a better system because we have inadvertently inculcated capitalist assumptions into our worldview. We cannot properly fathom the issues because we are looking at them through the lens of broken capitalist assumptions. These assumptions frame the way we understand the issues and inform the kinds of solutions we consider. Sustainability, the green economy, eco-friendly commerce, and all derive from the broken assumptions of capitalism.
We cannot fix the problem with the mindset that created the problem in the first place. To address the crises we face, we have to divest ourselves of these broken assumptions. It is magical thinking to suggest otherwise.
I fell prey to this magical thinking. When I started the Green Market Oracle in 2007, I was responding to the need for change but I was unknowingly responding to the threats of climate change and biodiversity loss using the broken assumptions of a broken system. I believed that by factoring in environmental and social considerations, the free market could turn away from unfettered growth as a matter of self-interest. I subscribed to well-intentioned but naive oxymorons like social capitalism.
From within the capitalist worldview, it all made sense, it was not until I was able to extricate myself from this overarching narrative that I could see that it is unworkable. Capitalism is antithetical to compassion, indeed to basic respect for living things. It is an amoral, soulless machine that is intractably geared toward profits and growth. Capitalism encourages short-term thinking, law-breaking, and corruption. It ignores the fundamental truth that we are part of the web of life and it cuts us off from the natural world, the substrate of our being and literal sustainer of all life.
We have made progress on many fronts, but we can no longer afford to slow-walk solutions, if we don’t significantly increase our efforts in the coming years we risk triggering tipping points from which we won’t be able to recover. I do not see how markets, no matter how green, can possibly alter our trajectory within the window of time we have remaining.
Need for change
My views were profoundly affected by the outbreak of COVID-19. I watched as the pandemic laid bare the fault lines of a broken civilization. Like so many, I despaired and prognosticated about an economic collapse and the end of civilization.
Despite these disheartening realizations, I still stubbornly cling to hope. This is in response to those who incorrectly state that it is too late for action. Hope also motivates those of us who are working to break free of capitalism’s death grip and imagine a new future. We will never do what we must if we do not have hope that we can succeed. I continue to believe we have reason to be optimistic and that we may finally do what needs to be done, However, after 30 years of trying, I no longer believe that our current economic system can get us where we need to go.
While I have been moving in this direction for many years I did not come to these realizations sooner because I was looking at the issues from within the capitalist mindset. This all-encompassing narrative organizes our understanding of the world. In this way, capitalism exerts tremendous control over us because we are steeped in its broken logic.
This is far more subtle than controls exerted by secret police in authoritarian regimes. Capitalism is a belief system that is pounded into our brains from birth. It frames our thoughts and determines how we think. Most of us don’t realize just how insidious it is, or just how deeply it has burrowed into our individual and collective consciousnesses.
What makes capitalism’s control so insidious is that we are stuck within a self-reinforcing bubble that makes it very hard to envision solutions outside of this bubble. And this is precisely what we need to do to alter our perilous trajectory. We will not be able to effectively address the crises we face until we expose the assumptions of a broken and deeply flawed system.
Truth be told, we need more than a new economic system, we need a paradigm shift. We need to change the way we view ourselves and the natural world. This implies radical change, on multiple interconnected levels.
The capitalist economic system has failed to address ever more pressing existential threats to life on this planet because it can’t. The combination of climate change and biodiversity loss is rapidly pushing us toward our collective ruin. It is folly to look to capitalism for our salvation when it is the harbinger of our doom. Capitalism can’t fix the problem because it is the problem.
Changing minds won’t be easy as we have all been brainwashed by this broken narrative. While capitalism causes pervasive harm, it is very good for those at the apex of wealth, power, and privilege. They can be expected to use their positions to defend their interests and perpetuate lies.
In the coming months, articles in Change Oracle will explore the fundamental unworkability of capitalism as well as analyze the viability of alternative approaches.