BUSINESS AS UNUSUAL

IS CAPITALISM CHANGING WITH THE TIMES?

- A Selway Ryan

Recently—in the dad-joke equivalent of Rilke’s Letters to a Young Poet—a Wall Street Journal columnist addressed the existential concerns of a “smart 22-year-old” who had come to him for investment advice. From his perspective, not having savings was like not wearing a seatbelt. He recommended opening a retirement account. She didn’t see the wisdom in this, given that, by the time she reached retirement age, the planet would be “a rotating cinder.”

The columnist suggested that a more measured attitude toward the future might be found in the works of Laurence Siegel, an author who’s written sunny accounts of the achievements and possibilities of capitalism. Siegel pointed out that, for most of world history, “almost everyone was poor beyond imagining,” and that this only changed as a result of the fiery new economic order that has flourished over the past 250 years. Today, half the world’s population is middle class or wealthier. This makes us substantially—and continuously—better off than we ever were.

As to the question of whether businesses are geared to prioritise the short term over the long, making money today at the expense of tomorrow, he allowed that many companies have behaved this way—but not so much anymore. Today, by and large, they are much better managed and take a longer-term view than they used to. “Believe me,” he said, “you don’t want to go back to the way they were run in, say, the 1970s.” What, then, has happened in the last 50 years that didn’t happen in the 200 years before?