Yesterday a conference on Inclusive Capitalism was held at the Mansion House in London with eminent speakers such as Bill Clinton, Governor of the Bank of England Mark Carney, Managing Director of the International Monetary Fund Christine Lagarde and the Prince of Wales debating how capitalism needs to be re-imagined for a changing world. One of the questions being addressed was which type of capitalism works best to build economic and social value?
Now, I am not an economist, and I get a bit weary of listening to economic language that seems to assume that economic questions have purely economic answers. So, I am encouraged that at the heart of yesterday’s international conference lay a fundamental question that puts economics in its rightful place: who and what is the economic system there for? In other words, you can’t look at economics without querying social value and human interest.
This is obvious, really, isn’t it? A strong economy cannot be an end in itself, but, rather, must be a means to an end. But, what that end should be – and how it should be achieved – is a matter of considerable and often aggressive debate. Yet, it asks of us what we think society is about, and uncomfortably focuses our attention on our anthropology: that is, who we think people are and why they matter. ‘Inclusive Capitalism’ sounds good, but is it possible to have an economic system that doesn’t exclude?
One of the phrases quoted a good deal in relation to this conference – including on this programme yesterday – was Jesus’s remark in what we often call ‘The Sermon on the Mount’: “You cannot serve both God and Mammon.” But, it seems to me that Jesus is polarising to make a point. In fact, he precedes this statement with: “No one can serve two masters. Either you will hate the one and love the other, or you will be devoted to the one and despise the other.”
This is a very powerful way of putting the question raised earlier: who is money for? If you love people – and not just in a generic way, but in the detail of the real people who come uninvited across your path (think Good Samaritan, for example) – then money is a means of enabling people to thrive … or, maybe in the short term, just survive. But, what if you assume that money and wealth exist for their own sake – and for the sole good of the person who accumulates both? It is not hard to see what sort of an economist Jesus might have been…
Undoubtedly, the system we have grown in the last century has brought massive benefits. But, we are now responsible for how we hand this on to our grandchildren. So, we are still left with the question that the conference began with yesterday: does the economy serve people or do people serve the economy? The answer will tell us what sort of people we have chosen to be.
You highlight a very important question. Thank you for bringing it to the attention of such a wide audience. Over the last couple of decades, the financial services industry has done much to divorce money from life. For many, money has ceased to be a means to an end and become an end in its own right, one reason why the sequence of financial crises since 2000 have brought real pain and suffering to ordinary people.
Your description of money as a means to enable people to survive and thrive leads, I suspect, to the conclusion that true wealth comes from investment in ourselves rather than investment in a portfolio of property and shares. We may need money to thrive; we also need skills, personal awareness, vision, goals, etc, all things that come from spending time and money on ourselves (and that is not meant in a selfish way). The financial services industry should be advising and encouraging individuals to set aside a proportion of their money for personal development as well as conventional savings and investment.
I am a little saddened that these debates always seem to take place that the macro level rather than at the household level. Financial literacy at household level is as important as the 3Rs and is given little support from institutions at the moment. What training there is tends to be based around financial products and regulations rather than financial planning, values and tenets.
Unfortunately, we will continue to serve the economy until we become deeply proficient in dealing with our personal finances in a holistic way that includes understanding the meaning of money and its role in our lives, the emotions surrounding money and, of course, the technical side of household money management. It is all very well the Clintons, Carneys and Legardes of this world discussing inclusive capitalism at the Mansion House. We need to bring the debate and wisdom into the kitchen.