Why we need to rethink capitalism

Day 257 / 365

In this Ted talk, Paul Tudor Jones talks about why capitalism might be failing us right now by increasing the wealth divide. He also talks about his organization “Just Capital”, a non-profit that is working towards fixing this.

Capitalism and Income Inequality

Most of the companies and corporations today are judged by their profit margins. And over the past few decades, the profit as a percentage of revenue for companies has increased to an all-time high. This would suggest that we are making progress. More profits would be good news for the shareholders, but what about the common workers?

If you look at the gap between the CEO income vs. that of the average worker, you will see that it has increased over the same time period. Also if you look at the contributions to charity by these corporations, they have gone down as well.

This income inequality is not a good thing, and it has been shown to be correlated to social and health problems in a country.

How do we end Income Inequality?

Paul believes that in the time to come, this gap between the richest and the poorest will go away, as it has done several times in the past. Generally, it happens in one of these three ways

• War
• Higher Taxes
• Revolution

None of these ways are desirable. But Paul suggests that there is another way to go about this.

“Just” Capital

Paul felt the need to judge a corporation not by its profits, but by some index that measured how “Just” and socially responsible it is. In order to figure out how we define this index, he created a non-profit called “Just Capital”. This organization will survey the American public to find out how they would want the corporations to be judged. After this, all the corporations will be ranked on a scale of 1 to 1000 based on this index.

The idea is that people and resources will start to gravitate towards “Just” corporations, and the goals of the corporations will be shifted to being not just profit-oriented, but being human as well.

This post is part of my 365 Day Project for 2019. Read about it here

Yesterday’s blog — Illusory Truth Effect