Dear Reader,
During last week’s Davos Agenda summit, Japanese Prime Minister Kishida Fumio called for “a new form of capitalism.”
He believes that “leaving everything to the market and competition” is the wrong way to go. Instead, the government should work with businesses to share “the full picture of social and economic transformation.” Heh.
When I was at Cato they used to call this the “third way,” as if you can have your socialist cake and eat it, too. No matter the nomenclature, it means taking money from one set and giving it to another.
If we’re going to play that game, why not make it voluntary? Ugh.
Once again the words of Jim Rickards come to mind: the Great Reset “comes off like a conspiracy theory” — except everyone involved is quite upfront about their schemes and desires.
It also brings to mind another phrase we’ve been hearing lately: stakeholder capitalism. A quick Google search says it calls upon “business leaders to define their mission as creating long-term value not only for shareholders but also for customers, suppliers, employees, communities and others.”
Ahem.
The late, great Dr. Kurt Richebacher saw “great fallacy and folly in America’s shareholder-value model.” That is, he thought executives spent too much time trying to boost their share prices in the short-term instead of investing in growth for the future.
So the idea behind stakeholder capitalism is off to a good start, then. The next few stakeholders mentioned are pretty common sense. If a business isn’t benefiting customers, they buy somewhere else. Failure to provide value to employees leads them to find new jobs. And if suppliers aren’t happy with their contracts, they can look for new clients.
Frankly, then, any executive who isn’t thinking of these things doesn’t deserve to be in charge.
But then we get to the belief that companies should provide long-term value to their “communities,” which ties into how the proposed new capitalism should drive social change. And as Kashida comes right out and says, the government should step in to make sure those changes occur.
If we’re conscious about it, when we cede commerce to the government, we’re on the road to serfdom.
Once again we’re left wondering who gets to decide which businesses are “doing enough” to enact social change… and what happens if they don’t get in line with the program.
Actually, we don’t have to wonder… as the H8ful Eight’s intrusive mandates for private companies and individual citizens have shown.
“They’re opposed to the idea that individuals get to determine what’s valuable to themselves,” Dan Denning tells me in this week’s Session. “The Davos crowd don’t like the outcomes of the world based on voluntary exchange.”
He cites a book called Mission Economy by Mariana Mazzucato. She argues that we need to “choose different values and then allocate capital, time, money and resources to solve those problems and produce those values.”
In other words, if the powers that be “don’t like the choices that you make because they think the outcomes are negative, then they think that choice should be taken away from you.”
Think of the ranchers who are living their lives near Dan in Laramie, Wyoming… and the world planners in Glasgow who are concerned about cow farts.
There’s a danger in turning over “decisions about money and life and work to people who don’t understand you, who aren’t part of your community,” Dan says.
You’ll get to hear more when we release our full interview on Saturday.
Follow your bliss,
Addison Wiggin
Founder, The Financial Reserve
