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System change - Selective Capitalism?

James Lee

New Member
I'm a new member here and would like to share a possible theory. I believe our current state of capitalism is unsustainable in the way we consume resources. But at the same time, I do not believe socialism is the way to go. What I believe in is selective capitalism, or capitalism in the right industries. Before the purists tie me to a stake, do hear me out.

To solve climate change, we need first understand the root cause of the problem. Whilst I am tempted to just state ‘humans’ as the answer, it really isn’t. The root cause is consumerism. In simple terms, we are a species who consumes goods and products like no other species on Earth. Some of us change a new Iphone every year, some of us own a hundred pairs of shoes, some of us buy things to store at home unused till the next garage sale. That is consumerism — the wanton buying and accumulation of items which we may not need.

To reduce consumerism, one needs an economic solution. For too long, our economic model has fueled consumerism and that does not make logical sense. To illustrate, a latest model of the Iphone XS easily costs a cool grand (US$1,099). Your next meal at Subway probably costs less than 1% of that. Yet, in times of catastrophe or disaster, the prices of the two are reversed. We know this because of demand and supply.

Consider a pricing model that re-imagines this demand and supply, and to peg this pricing model to Maslow’s Hierarchy. Basically, I slapped on a price versus Tier graph onto Maslow’s famous pyramid.




What you have here now it the price of the Tier 1 needs — food, water, shelter (essentially survival items) being priced the highest on the price axis (y-axis). As the Tier increases, the prices decreases. In short, food prices will be highest priced, whilst education, cars, phones etc fall into lower priced categories and that is the crux of this pricing model.

When food prices are at a level sufficiently high, it forces a change in our spending habits. Suddenly, changing a new model of Iphone every year does not seem that necessary anymore. Saw a new barbecue grill at Walmart? Nah, the current one is still usable. How about buying that new vase that is on sale? Nope.
You get the point. Food and sustenance becomes the number one priority. When that happens, there are many trickle down effects. First, you consume less, and reduce, reuse and recycle more. That is already helping climate change. When demand for consumer goods reduce, these industries scale down, reducing consumption of fossil fuels used to power manufacturing industries. Carbon emissions drop as a result. The restructuring of the economy and the high food prices draws investors who want to cash in on the agri industry. The agriculture and food production industry booms. Based on a study by Food and Agriculture Organisation’s (FAO) in 2015, one in three working adults work in agriculture and these are typically from the poorest nations on Earth. As a result of the investment flows into the agriculture and food production industry, there will be trickle down effects in terms of increased wages for farmers, and a redistribution of wealth to the poorest. The reduces income inequality. (A good example is the oil industry, where although the corporations benefited tremendously, the workers in the oil & gas industry also benefited in terms of wages. #foodisthenewoil)

The investment into the agriculture industry drives R&D, which will hopefully solve the food problem for an estimated 10 billion people by 2050. It will also hopefully solve the issue where the FAO estimates 815 million people still suffer from chronic hunger. To put that into context, that is 10% of the Earth’s population. It is also hoped that the R & D can create more sustainable forms of agriculture, food production, storage and distribution

When agriculture and food production is one of the key industries, it cannot be allowed to fail, or be devastated by 1.5 degree increase in global temperatures, or rising sea levels, or erratic weather. Awareness of climate change will spread and there will be more efforts to tackle climate change.
All in all, tackling the root cause solves a whole range of problems which our current economic model has created. The solution, hence, is an economic one. This is my theory of selective capitalism, in the industries that matter.

This essay is extracted from parts of my book, ‘Humanity beyond the 21st century’. Raising food prices is only one part of the solution, but it is the most important part. To really address the problem, the exact pricing model for each item has to be defined. I have omitted that here as it is too lengthy a discussion.
 

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