Far from Correcting the Distortions of Unbridled Capitalism, the Political Process Makes Them Worse

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So says Sam Brittan in today’s FT, reviewing Robert Reich’s Supercapitalism: the Battle for Democracy in an Age of Big Business. You’ll remember Reich as Bill Clinton’s secretary for labor.

In a nutshell, Reich argues that the golden age of capitalism — the rebuilding of the post-war years up to the 1970s — delivered enough prosperity to win the allegiance of most ordinary folk. That got replaced by ‘supercapitalism’ which has delivered our present mess.

For Brittan the novelty in Reich’s book lies in his rejection of a central role for corporate social responsibility. Instead, Reich gets into the intellectual bed of Milton Friedman — who famously argued that it’s the job of businessmen to make lots of dosh, and that’s their sole responsibility. For Reich we need to strengthen states to ensure that dosh-making is compatible with society’s goals — as set out by democracy.

Brittan likes this (unexpected) approach. But he’s less optimistic about democracy pushing business in the right direction. US energy policy is Brittan’s example (presumably excessive subsidies for biofuels driving up world food prices). And Brittan cautions that this might also let business off its (moral) hook:

“… there is a danger that the Friedman-Reich position could inadvertently give sustenance to the “I was only doing my job” defence for evil actions”.

We continue to think this one over while awaiting our copy of Reich’s book. In the meantime, you can read his excellent blog here.

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