fair trade capitalism

In the modern dominant world-system, success can be measured by one bottom line; economic profit. In the current paradigm, costs, risks, and losses are socialized and naturalized while profits are privatized to the furthest extents possible. Legal cartels masquerade under “free trade agreements,” driving disadvantaged workers and producers away from market participation. Furthermore, ecosystem services largely help to buffer the material and energy costs borne through the ideals of maximizing economic growth to no end.

This system is not true capitalism nor is it true socialism. Yet, there are characteristics of both. I do not believe either philosophy is what we seek, in their truest forms. Contrarily, they appear to be extremes on an economic theory spectrum; a dichotomy. This can easily be seen by the vehement hate spewing from both sides of the political aisle. There is strong opposition to extremes. That’s how balance works.

I believe both of these (pure) ideologies are flawed in that they make assumptions of economic theory in a vacuum. They ignore the facts that economies exist within social structures (hence the repulsion to both sides of their hyperbole), themselves within environmental structures. Economies exist in the real world, where shit happens. It does. And when shit happens, woe goes the economy. Look no further than our current situation(s).

Whatever the cause (pandemic, environmental disaster, climate change, good ol’ scarcity, etc…), economic theory cannot make entities resilient. It can inform banks, but that’s not quite cutting it for us everyday people, is it? Something else must be done, or at least, accounted for…

Being that capitalism is the platform on which all sovereign nations and states trade, it isn’t going anywhere anytime soon. Besides that, it has given rise to the opportunity to accelerate our advancements at a faster pace than historians ever thought possible.

The elephant in the room though, would be the inequality experienced by the world over. I don’t have to spend any time telling you how rough somebody has it, because chances are you have it rough too.

Now, I’m not advocating for our country to abandon capitalism and turn the keys over to the government. That’s the last thing any world citizen wants, let alone (informed) Americans.

But, I do NOT want us to be afraid of taking control of things we democratically agree should be placed in better hands. I do NOT want capitalism to destroy social health in the name of economic profit. I do NOT want socialism to remove all economic motivation in the name of social security. What I DO want, is a world-system that respects the true value and roles of our environmental and social structures in order to support economic health and longevity.

I DO believe some things are best left in the hands of markets. (Profit)
I DO believe some things are best left in the hands of society. (People)
I DO believe some things are best left in the hands of nature. (Planet)

I was taught how to rethink economies capitalistic and socialistic alike, with an environmentally responsible twist. Some say I was brainwashed by the radical left, but I would argue that even the simplest of shapes has three sides. Either way, it goes a little something like this:

1.) Materiality: Determine and quantify the value of all inputs and outputs of an entity. This was the hardest thing to do when I started school. Nowadays, we have Life Cycle Analysis toolkits and Greenhouse Gas Inventory tracking software suites that have done most of the complex leg work.

2.) Categorize information into statistically relevant datasets. Again, this has become much less frustrating over the years with the use of LCA and GHG programs.

3.) Balance the Triple Bottom Line. Ideally, you want to balance each bottom line separately. In many industries (energy, transportation, agriculture) this will be impossible, but being able to balance the sheet as a whole is what truly counts as Sustainable.

Targeted economic taxes and subsidies can help offset small business impacts by privatizing big business’ fair share of costs that have been socialized to this point. In other words, the big bois pay for the little guys to enter the markets by balancing their social and environmental costs with economic contributions. Not only does this create competition and drive innovation, these taxes can be used to mitigate carbon emissions or be invested into renewable technologies and infrastructure, returning some benefits to society as a whole. In turn, this drives markets for sustainable technologies while reducing pressures on ecosystem services.

Triple bottom line accounting on this level can transparently explain the risks, costs, and benefits created by an entity, effectively insulating it from economic, social, and environmental events that could threaten it’s existence. In fact, by conforming to a framework of Sustainability accounting, a business actually helps reduce the risk created by all of these outside pressures. It becomes so entrenched and deeply valuable to the systems it participates in that it can truly be referred to as Sustainable. Too big to fail becomes a thing of the past when we can create and preserve value amongst all three bottom lines.

Is it a scheme that will create billionaires and large, multi-national conglomerates? Probably not, but that’s a good thing. In order to encourage spending by everyday consumers, our financial institutions increase money supply (normally through fractional reserve lending and mortgage rates, among other financial levers). This results in increased economic activity, but also establishes the basis of an inflationary currency. When we understand that the dollar loses value over time, we realize that money not spent is money burned. Those who hoard money not only create inequality, they destroy it’s value in relation to the rest of society when they don’t invest it.

Consumers and employees are getting wiser. They are beginning to pay much more attention to what businesses do as a whole rather than only to the products and services they provide. And they are beginning to spend their money and look for work appropriately. Green business will soon be usual business. Top talent wants top dollar commitment to our future. The first companies to embrace these values and prove their worth not just economically, but socially and environmentally as well, will be the first to realize true and holistic wealth.

Capitalism is here to stay. But, are we?