S7 E11: Better Capitalism?

Published in 1776, 'The Wealth of Nations' is Adam Smith's magnum opus that laid the groundwork for modern economics. The book critiques mercantilist economic theories and introduces the concept of the 'invisible hand,' which describes how individual self-interest leads to societal benefit. It emphasizes the division of labor, the accumulation of capital, and the importance of free markets. Smith argues that a nation's wealth is not measured by its gold and silver reserves but by the stream of goods and services it produces. The book also outlines the core functions of government, such as maintaining defense, enforcing civil law, and promoting education, while advocating for limited government intervention in market activities.

Wealth Supremacy by Marjorie Kelly examines how the bias towards wealth in capitalism leads to economic injustice and environmental crises. The book debunks seven myths underlying wealth supremacy and proposes a shift towards a democratic economy with public ownership and worker-owned businesses. Kelly argues for a non-extractive capitalism that prioritizes the public interest over profit maximization.

The book, commissioned by the Club of Rome, uses the World3 computer model to simulate the consequences of interactions between human systems and the Earth. It examines five basic factors: population increase, agricultural production, nonrenewable resource depletion, industrial output, and pollution generation. The authors conclude that if current growth trends continue, the Earth's resources will be depleted, leading to a sudden and uncontrollable decline in population and industrial capacity. However, the book also offers a message of hope, suggesting that forward-looking policy could prevent such outcomes if humanity acts promptly to reduce inefficiency and waste.