Long before Covid-19 hit, faith in capitalism was faltering. The global recession of 2008 highlighted the growing gulf between the haves and the have-nots in developed economies. Soon after, the rise of China’s state-managed economy challenged the hegemony of unconstrained free markets.
In the United States, the surging pandemic has sent inequality into overdrive. American billionaires have grown 20 percent richer, as unemployment has soared to record levels. It remains to be seen just how much of this cognitive dissonance the system can sustain before spinning into total chaos.
How did we get here? My new book, On Capitalism and Inequality: Progress and Poverty Revisited, traces our troubled moment to a series of actions and decisions spanning nearly 50 years.
The history is too involved to summarize here – I provide a condensed description in this INSEAD Knowledge podcast devoted to my book. Suffice it to say that starting in the 1970s, the more benign aspects of capitalism – honest competition, a free market held accountable to human needs, a bracing element of entrepreneurial risk – retreated as Wall Street speculation came to the fore, heavily weighted in favour of those who already had a firmly planted stake in the system.
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