NationStates Jolt Archive

http://www.economist.com/surveys/displaystory.cfm?story_id=5517656
The birth of philanthrocapitalism

“RELATIVE to the corporate environment, we are in the 1870s. But philanthropy will increasingly come to resemble the capitalist economy,” predicts Uday Khemka, a young Indian philanthropist and a director of the SUN Group investment company owned by his family. Like many of the new generation of philanthropists, he has big but well-defined ambitions. “I want to help develop the infrastructure of philanthropy,” he says.

The need for philanthropy to become more like the for-profit capital markets is a common theme among the new philanthropists, especially those who have made their fortune in finance. As they see it, three things are needed for such a philanthropic marketplace to work.

First, there must be something for philanthropists to “invest” in—something that, ideally, will be created by “social entrepreneurs”, just as in the for-profit world entrepreneurs create companies that end up traded on the stockmarket.

Second, the market requires an infrastructure, the philanthropic equivalent of stockmarkets, investment banks, research houses, management consultants and so on. This is what Mr Khemka wants to concentrate on.

Third, philanthropists themselves need to behave more like investors. That means allocating their money to make the greatest possible difference to society's problems: in other words, to maximise their “social return”. Some might operate as relatively hands-off, diversified “social investors” and some as hands-on, engaged “venture philanthropists”, the counterparts of mainstream venture capitalists.

All this may sound fine in theory. However, the history of philanthropy suggests that there are many potential pitfalls.

-continues-

Well, the word is certainly long and complicated enough to inspire awe in unwitting readers, so the first step towards a functioning political ideology has been made. ;)

What do you think? Will "Philanthrocapitalism" be the next step as government-based charity and redistribution is made obsolete and counterproductive by globalisation and free trade?

The Nobel Peace Prize this year went to the founder of the Grameen Bank (http://en.wikipedia.org/wiki/Grameen_Bank) - a development lender. No government involved, just one guy with a bit of money and an idea.

With the media making the problems of the world more and more obvious (even as the traditional forms become gobbled up by rich people with political agendas, alternative news sources are replacing them), and public opinion becoming a real and recognised source of competitive advantage...plus the general feeling these days that the world can do better - do you think that these social venture capitalists will change the world for the better on a grand scale?

I think it would be swell.

I think it would be swell.

You forgot "Gee Whillikers" :D

I'm glad you posted this article, as it introduced me to the Grameen Bank, which is actually a very cool idea!

Good work, NL!

...Grameen Bank...
Although I may have been a bit inaccurate when I said "no government involved" - the Bangladeshi government has a small stake in it now.

But the guy who started it wasn't a government official, and it wasn't a government policy.

+1 for the blessings of free markets, peaceful cooperation and mutually beneficial exchange! :D

Well, the word is certainly long and complicated enough to inspire awe in unwitting readers, so the first step towards a functioning political ideology has been made. ;)



That is the best single sentence I have read all week. I will be plagued by it's truthyness for a very long time. I congratulate you sir and am envious that I did not say it first.

I am very happy to see that there is an awareness that not enough effort has gone into checking and being able to check the results of philanthropic endeavors. I think that this aspect of it standing alone might make a huge difference in not only effectiveness of existing assets but also in the willingness of people and organisations to donate further assets for philanthropic reasons. Sanity meets charity on equal terms.

Philanthrocapitalism? What the hell kind of word is that? You might as well call it Soviet Canuckistan for all the sense it makes. Philanthropy and capitalism really don't mix all that well. That's why various forms of welfare exist in the first place. I honestly don't see how they CAN ever work together in the sense we're talking about here.

Gave up half way through the second paragraph.

Philanthropy and capitalism really don't mix all that well.
Why? Did you read the article? Which part did you disagree with?

<snip>

My former company TATA is one such company. It is the biggest conglomerate of India, I think, because of the split in the Reliance industries.

http://news.monstersandcritics.com/business/article_1212892.php/Background_Indian_multinational_Tata_group_continues_to_expand
New Delhi - Tata Steel, the company set to take over the Anglo-Dutch steel maker Corus, is just one of the many businesses of the Tata group, one of the India's largest business conglomerates.

Comprising 96 companies in seven business sectors, the group has a market capitalization of 49.1 billion US dollars.

The stable includes India's top outsourcing firm Tata Consultancy Services, India's largest privately-owned steelmaker Tata Steel and Tata Motors, which has sold 500,000 of its Indica sedan cars to date and exports the vehicles to Europe, South Africa and Russia.

The group's interests also include luxury hotels, telecom, jewellery and tea.

Tata Group's revenues touched 21.9 billion dollars, about 2.8 per cent of India's gross domestic product (GDP) in 2005-2006. The group has a combined shareholder base of 2 million.

Spearheading the rapid growth which timed with opening up of India's economic policies, is 68-year-old group chairman Ratan Tata, who took over from his cousin JRD Tata in 1991.

The group's revenues have increased by about seven times since Ratan Tata took over and is expected to touch 24 billion dollars in the next financial year, according to business analysts.

While Ratan Tata may be a family name, the group's businesses that together employ more than 200,000 people have been run by professional managers for several decades now.

That, say industry analysts, is a strength of the Tata group making it different from other Indian family-held businesses.

What also sets aside the Tata group from many other Indian business houses is its strong adherence to business ethics and a commitment to corporate social responsibility.

About 66 per cent of the profits of its investment arm Tata Sons goes to charity every year.

And among its recent global business destinations are Bangladesh and Africa, where the company is setting businesses in what analysts term a profit-linked model of development.

In Bangladesh the group recently finalized a 3 billion-dollar deal to set up power, coal and steel plants. It has a coffee plant in Uganda, a bus manufacturing unit in Senegal and a phosphate unit in Morocco.

Its steel plant in Jamshedpur was built from scratch in the jungle by the company's founder Jamshetji Tata, grandfather of Ratan Tata, in 1912 when India was a British colony. The aim then was to develop a strong Indian manufacturing company.

The plant is now at the centre of a sprawling township where workers get free healthcare and education for their children.

The ethical values of the company are evident in that Tata Steel has not had a workers' strike for 75 years - despite the fact that the workforce was cut down from 78,000 in 1991 when Ratan Tata took over to the current 45,000.

By cutting its workforce, Tata Steel retained its competitive edge as the largest privately-owned steelmaker in India but kept true to its promise of paying all laid off workers their full salary till retirement.

Analysts feel this record will stand in good stead for Tata Steel in its Corus takeover attempt.

The company is India's foremost multinational corporation with operations in more than 54 countries.

The takeover of Corus group is the latest in a series of recent takeovers by the group in its effort to go global.

The more important among its acquisitions is that of the Britain- based tea company Tetley in 2000, the Daewoo Commercial Vehicle company of Korea in 2004, and Singapore's NatSteel also in 2004.

http://www.telegraphindia.com/1060815/asp/frontpage/story_6613239.asp
Tata Steel family to adopt land orphans
- Rehabilitation with human touch for those displaced by greenfield projects


http://www.msnbc.msn.com/id/8359069/site/newsweek/
July 4 issue - A new kind of multinational corporation is emerging out of India, the hot newcomer in the global economy. It is the Tata Group, a family conglomerate that has gone professional without losing a distinct set of old-school values. Forged from both India's struggle for independence from Britain and the influence of early-20th-century Fabian socialists, Tata is a ferocious competitor with a very liberal touch. Consider: one of the largest of its 32 businesses, Tata Steel, has cut almost half its work force in the last 15 years to become the lowest-cost competitor in this brutal industry—yet has kept its promise to pay all laid-off workers full salary until retirement.
Story continues below ↓ advertisement

In some ways, Tata could exist only in India, where wages of $1.20 an hour make cradle-to-grave corporate welfare far more affordable than it would be even in China. But Tata is unique even inside India, where its rigid ethical standards are so well known that corrupt officials typically don't even bother asking Tata executives for bribes. The company has walked away from Indian industries, like Bollywood films, known for shady cash transactions. Though India is a hotbed of labor strife, Tata Steel has gone 75 years without a strike. Tata's car plant at Pune has gone 16 years, and local union rep Sujit Patil says his people work with management daily, a state of labor relations "very different" from that at other Indian companies.

Today India's best-known global competitors are young companies like Infosys, which provide outsourcing services to global companies and govern themselves by unabashedly Western business standards. In contrast, Tata is 131 years old and remains true to its 19th-century mission—developing India as an industrial power. Yet it also includes in its stable India's leading outsourcer: Tata Consultancy Services, which is bigger than Infosys. As a whole, the Tata Group is India's largest company by market cap, with $17.6 billion in revenues and $1.9 billion in profits in the 12 months through March, roughly three times its results a decade ago. The conglomerate expects revenues to skyrocket to

—$24 billion this year, driven by cars, steel and IT consulting.

The story of Tata is thus a window into the rise of India. While the country's vibrancy is attributed to free-market reforms that began in the early '90s, Tata executives emphasize that even now, they grow despite obstacles thrown up by red tape and special interests. Unlike the boom in China, which has been orchestrated by the government, India's rise is primarily the story of an enterprising private sector. Often seen in the United States as an outsourcing economy that threatens to siphon off service jobs, India also has a wider potential that is mirrored in the range of Tata's ambitions—from luxury hotels and jewelry to a planned $2,000 car. The company's expansion is a symptom of how India's boom is lifting demand across the domestic economy.

In recent years, as Tata began listing shares in some of its affiliates on Wall Street, Americans often compared the company to the model conglomerate they know best: General Electric. But CEO Ratan Tata, 67 , is no Jack Welch. "Certainly not," he says. Tata executives, many armed with Western M.B.A.s, have all read about Welch, and dismiss many of his American tactics—from mass layoffs to hostile takeovers—as violations of the Tata way. Ratan Tata says his company is not driven to grow "over everybody's dead bodies." This is a company where 66 percent of the profits of its highly successful investment arm, Tata Sons, go to charity. At Tata "corporate social responsibility" is not just a hot buzzword, as it is in the West, with no real money behind it.

That's all very laudable, to be sure, but can Tata remain true to its liberal roots as it goes global? While the conglomerate has put shares of some of its companies up for sale in the West, Ratan Tata makes it clear he is in no rush to submit its real power center, Tata Sons, to the short-term profit motives of Wall Street. Since 2000, Tata has acquired Tetley Tea of Britain, Daewoo Motor of South Korea and NatSteel of Singapore. Yet it's also moved into markets where Western multinationals dare not tread, including Bangladesh and Africa, where Tata has assumed the role of a for-profit development agency. However far those markets, they are near in spirit to the century-old social experiment of Jamshedpur, the company's original steel town.
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Philanthropy and capitalism really don't mix all that well. That's why various forms of welfare exist in the first place. I honestly don't see how they CAN ever work together in the sense we're talking about here.

I worked for 4 years at TATA. I have taken part in both their philanthropical and capitalist endeavours. Seeing their success and growth and the respect they have in the society, I guess they can and they do mix well, if managed properly. The company enjoys immense goodwill with Indians. People almost have a patriotic swell when mentioning the name TATA, a far cry from the anti-corporate feeling in many countries.

Philanthrocapitalism? What the hell kind of word is that? You might as well call it Soviet Canuckistan for all the sense it makes. Philanthropy and capitalism really don't mix all that well. That's why various forms of welfare exist in the first place. I honestly don't see how they CAN ever work together in the sense we're talking about here.
IOW: you don't know what you're talking about. You really shouldn't have posted, given that you just told everyone that you're either so anti-capitalist or so deeply deluded that you're willing to blind yourself to reality in order to save your worldview. Happens a lot among fundamentalists of any sort.

At any rate, philanthropy and capitalism mesh perfectly well. Unless, of course, you believe the myth that capitalists just want to kill everyone with horrible products, starve the workers with "slave wages", and generally "horde" all the money they have in a mattress.

Jesus christ, this is yet another piece in the puzzle of Anarcho-Capitalism. If this socio-economic construct takes off, Government welfare will be outclasses by private philanthrocapitalism. Soon everyone will just realise private enterprise can and does do everything the government does, better cheaper, and more efficiently. Except private enterprise doesn't tell you who you can marry. It's getting closer people *Raises arms* DO YOU DIG IT? DO YOU DIG IIIIT?

And the fact that if more and more of the world becomes developed, that means there will be more and more demand for the products provided by multinational firms.

If I were Bill Gates, I'd campaign for education and utilities proliferation in the developing world. That way, demand for computers will rise.

And the fact that if more and more of the world becomes developed, that means there will be more and more demand for the products provided by multinational firms.

If I were Bill Gates, I'd campaign for education and utilities proliferation in the developing world. That way, demand for computers will rise.
It is true. Some of the larger multinationals really do have significant macroeconomic interests.

And the fact that if more and more of the world becomes developed, that means there will be more and more demand for the products provided by multinational firms.

That's true. Also, more education means more workers and facilities for research and development, which means more products, more technology, and most importantly a higher standard of living. Another important fact is that a more developed economy tends to be more stable, and it's a lot easier to address socioeconomic problems if you have the resources and governmental framework to achieve it. A more stable economy means a more stable government, which means real gains for the people of the country.

So, by all means corporations should invest in infrastructure and education in developing nations. Also, better infrastructure means a better supply chain, which means more profits and increased competitiveness with other firms...to say nothing of the added economic growth that will drive demand for products.

The criticisms of foundations in the article seem to be well thought out and correct. However, I don't believe that in order for that type of organization to succeed it must be started by capitalists. For instance, UPMC (University of Pittsburgh Medical Center) is a nonprofit organization that is growing, but isn't privately owned. (They own and run most of our local hospitals.)
Furthermore, while I can see this type of system growing, I don't believe that it will grow to the point to where it would make government charity obsolete. Starbucks advertises that it has 'fair trade' coffee, but I doubt that a significant percentage of its profits comes from that type of coffee.

IOW: you don't know what you're talking about. You really shouldn't have posted, given that you just told everyone that you're either so anti-capitalist or so deeply deluded that you're willing to blind yourself to reality in order to save your worldview. Happens a lot among fundamentalists of any sort.

At any rate, philanthropy and capitalism mesh perfectly well. Unless, of course, you believe the myth that capitalists just want to kill everyone with horrible products, starve the workers with "slave wages", and generally "horde" all the money they have in a mattress.
...hahahahaha. This amuses me. Me, anti-capitalist? Take a look at my nation. That reflects all of my views on everything right now. (As well as it can, anyway.)

I'm just not entirely certain that the fundements of philanthropy and capitalism can work hand in hand, since at first appearance the two systems seem to work against each other. I'm hardly saying that people can't be philanthropic and capitalistic. I'm just saying the basic SYSTEMS don't appear to work together all that well.

...hahahahaha. This amuses me. Me, anti-capitalist? Take a look at my nation. That reflects all of my views on everything right now. (As well as it can, anyway.)
What you have there and what you said above do not mesh. Ergo, you do not know what you're talking about.


I'm just not entirely certain that the fundements of philanthropy and capitalism can work hand in hand, since at first appearance the two systems seem to work against each other.
Not in the least. It only would seem that they are if you buy into the myth that capitalism is "cut-throat, dog-eat-dog".

Too often capitalism is interpreted as "dog-eat-dog" economy. Nothing is farther from the truth. The main problem is the pervasive viewpoint of the economy as a zero-sum game. People think that when one side of an exchange improves, then for some reason or another, the other side must lose.

Philanthropy can exist principally in a capitalistic free market (rights to free property disposal), and practically wherethe market both provides economic incentive and allows someone to follow personal reasons to engage in charitable exchange.

My former company TATA is one such company. It is the...

I apologize in advance.



So,.. are those bodacious TATA's..!?

The criticisms of foundations in the article seem to be well thought out and correct. However, I don't believe that in order for that type of organization to succeed it must be started by capitalists. For instance, UPMC (University of Pittsburgh Medical Center) is a nonprofit organization that is growing, but isn't privately owned. (They own and run most of our local hospitals.)
Furthermore, while I can see this type of system growing, I don't believe that it will grow to the point to where it would make government charity obsolete. Starbucks advertises that it has 'fair trade' coffee, but I doubt that a significant percentage of its profits comes from that type of coffee.

Aye, but in this case firms stand to earn big if they can play a vital role in helping a nation to develop a stable government, an effective education system, and working infrastructure. Even more than that, firms will have the resources to back these kinds of drives, and the sort of influence with various governments to get this stuff done.

Aye, but in this case firms stand to earn big if they can play a vital role in helping a nation to develop a stable government, an effective education system, and working infrastructure. Even more than that, firms will have the resources to back these kinds of drives, and the sort of influence with various governments to get this stuff done.True, but they would also earn big by offering bribes to the officials to become the nation's official [Commodity x] dealer. A firm with several products would especially be able to do this.

True, but they would also earn big by offering bribes to the officials to become the nation's official [Commodity x] dealer. A firm with several products would especially be able to do this.

They'd get something, but nowhere near as much as if they had a large, fairly well off, developed consumer base willing to purchase their products, because, let's face it, what good is a PC going to do for someone who is illiterate and has no electricity?

They'd get something, but nowhere near as much as if they had a large, fairly well off, developed consumer base willing to purchase their products, because, let's face it, what good is a PC going to do for someone who is illiterate and has no electricity?Mandatory purchasing laws, perhaps?

Additionally, I'm not certain that it's a good idea to make a country beholden to a business, no matter how well intentioned the business. I do realize that this is my bias showing.

Mandatory purchasing laws, perhaps?
Which would be totally worthless if the entire populace was composed of subsistence farmers who had no money at all. Mandatory purchasing laws in, say, Zimbabwe, would be totally ineffective.

Additionally, I'm not certain that it's a good idea to make a country beholden to a business, no matter how well intentioned the business. I do realize that this is my bias showing.

Well, if temporary dependence on a business is the price of development, I'd be totally willing to live with that.

I'm just not entirely certain that the fundements of philanthropy and capitalism can work hand in hand, since at first appearance the two systems seem to work against each other. I'm hardly saying that people can't be philanthropic and capitalistic. I'm just saying the basic SYSTEMS don't appear to work together all that well.
Philanthropy is not a system. It is a tendency to give to the less well-off. Capitalism neither hinders it nor promotes it.

Soon everyone will just realise private enterprise can and does do everything the government does, better cheaper, and more efficiently.
Except (again) that anyone who has worked in or dealt with the corporate bureaucracy knows that it is every bit as inefficient, dehumanizing and crappy as the government bureaucracy. Corporations are just better externalizers.

But the guy who started it wasn't a government official, and it wasn't a government policy.

And it went against the prevailing wisdom that mega-projects were the solution to the developing world's woes.

Except (again) that anyone who has worked in or dealt with the corporate bureaucracy knows that it is every bit as inefficient, dehumanizing and crappy as the government bureaucracy. Corporations are just better externalizers.
Yeah except for that whole freemarket of competition thingy. I am not talking about how terribly depressing it is to be a corporate middleman in comparison to being a public servant. I'm not even talking about the merits of corporate bureaucracy over government bureaucracy. I am talking about the difference between a government which maintains a forced and unnatural monopoly on whatever services it provides in contrast to the ever competeing freemarket one finds in the private sector. I talking about the difference between earning a buck, and taxing it.

Yeah except for that whole freemarket of competition thingy. I am not talking about how terribly depressing it is to be a corporate middleman in comparison to being a public servant. I'm not even talking about the merits of corporate bureaucracy over government bureaucracy. I am talking about the difference between a government which maintains a forced and unnatural monopoly on whatever services it provides in contrast to the ever competeing freemarket one finds in the private sector. I talking about the difference between earning a buck, and taxing it.
Some people are just biased against free market undertakings because they are, well, free market undertakings.

Some people are just biased against free market undertakings because they are, well, free market undertakings. I'm not biased against free-market undertakings because they are free-market undertakings. I just don't think they are inherently good because they are free market undertakings. Or more accurately, because the free market does not exist (and is incapable of existing as anything other than a theoretical construct) I do not consider a corporate undertaking to have inherently more value than a governmental one. I guage an institutions value by whether they provide more social gains than social costs. Since many corporations are only able to turn a profit because they externalize their cost onto society rather than bearing it themselves, I consider them to have negative value. That does not mean that I am biased against corporations, because there are plenty of corporations who provide positive value. It just means I am biased against those corporations that don't.

Yeah except for that whole freemarket of competition thingy.

And in a world of perfect competition, perfect information, and all of the other unrealistic assumptions that free market theory makes, it might be realistic to expect that competition would inherently make the "private sector" more competitive. But in the real world, with all of its externalities, power imbalances, market imperfections, etc, there is no reason to necessarily expect that it will be the case.

I am talking about the difference between a government which maintains a forced and unnatural monopoly on whatever services it provides in contrast to the ever competeing freemarket one finds in the private sector.

Some monopolies are unnatural. And many industries are largely monopolistic or oligopolistic. The free market (as we know it) is not inherently competitive.


I talking about the difference between earning a buck, and taxing it.
Sometimes, the difference is illusory. There would be little difference between paying the government for a service we require and paying a monopolistic corporation for one. Either way, we are out a buck, and have little choice in the matter.

Again, it comes back to what kind of social value we get for that dollar (see above post).

I'm not biased against free-market undertakings because they are free-market undertakings. I just don't think they are inherently good because they are free market undertakings. Or more accurately, because the free market does not exist (and is incapable of existing as anything other than a theoretical construct) I do not consider a corporate undertaking to have inherently more value than a governmental one. I guage an institutions value by whether they provide more social gains than social costs. Since many corporations are only able to turn a profit because they externalize their cost onto society rather than bearing it themselves, I consider them to have negative value.
The reason for a lot of corporate bureaucracy is in fact (often unnecessary) government regulation - even the corporate charter is a government creation.

I am not going to get into word games over what a free-market is or isn't, or whether or not it exists -- I take it to mean a competitive market; if government or large corporations reduce its competitiveness, measures must be taken to reform the former or to coerce the latter.

As for corporations being better externalizers, this is to an extent true -- however, this is in part largely due to the costs being created not being accounted for; for instance, without ownership rights of air within a community, it is more difficult to mount a successful lawsuit against a polluting agency.

One of the reasons that I support the free market is that it is the best means for supplying resources to the poor through philanthropy and taxation.

It feels good to give, and most people like to feel good.

One of the reasons that I support the free market is that it is the best means for supplying resources to the poor through philanthropy and taxation.

It feels good to give, and most people like to feel good.
How is the second related? :confused: And what is with all this optimism?

How is the second related? :confused:
Well, the poor aren’t gong to get everything you need voluntarily.
[quote]And what is with all this optimism?
No one ever got anywhere by being a pessimist. Anywhere worth going to anyway.

Well, the poor aren’t gong to get everything you need voluntarily.
Well, yes, but I was just curious as to why you stuck this together with the free market.

No one ever got anywhere by being a pessimist. Anywhere worth going to anyway.
Meh, I still hold a negative view of most people -- but it doesn't stop me from progressing. ^^ Look what this... *hiss* optimism is doing to you! Destroying your spelling. :(

The reason for a lot of corporate bureaucracy is in fact (often unnecessary) government regulation - even the corporate charter is a government creation.

Yet some (although by no means all) of that regulation is probably necessary in order to achieve objectives that we collectively value more than economic efficiency.


I am not going to get into word games over what a free-market is or isn't, or whether or not it exists -- I take it to mean a competitive market; if government or large corporations reduce its competitiveness, measures must be taken to reform the former or to coerce the latter.

Agreed. But who can coerce the latter if not the government?


As for corporations being better externalizers, this is to an extent true -- however, this is in part largely due to the costs being created not being accounted for; for instance, without ownership rights of air within a community, it is more difficult to mount a successful lawsuit against a polluting agency.

Agreed. But you don't need to create ownership rights over air in order to internalize the costs of air pollution. You simply need an emissions trading system. But that still generally requires government intervention to implement, even if it eventually leaves the heavy lifting to the market.

Yet some (although by no means all) of that regulation is probably necessary in order to achieve objectives that we collectively value more than economic efficiency.
"Collective valued objectives" are too broadly definable. Measures that seek to keep the market competitive, to hinder corporations from deliberately misinforming or harming consumers, to maintain decent working conditions for employees etc. are all fine by me -- ie measures specifically aimed at preventing abuse of the individual and at keeping the market free, whether or not they are of collective value.

Agreed. But who can coerce the latter if not the government?
I'm not engaging in a diatribe against all government - just unnecessary government.

Agreed. But you don't need to create ownership rights over air in order to internalize the costs of air pollution. You simply need an emissions trading system. But that still generally requires government intervention to implement, even if it eventually leaves the heavy lifting to the market.
I'd prefer a mixture of both, as far as possible. Whichever is more efficient.

So I'm a complete and total moron.

I didn't fully understand what the article was getting at first, you see. Then I saw the new poster we put up at work. "Everytime you use your Mastercard, a donation is made to the Foundation for Adoption." At first, it made me mad, since it looked like exploitation. Then I realized: it's philanthrocapitalism. I now understand completely. Philanthropy and capitalism go together like two peas in a pod, so to speak.

So I'm a complete and total moron.

I didn't fully understand what the article was getting at first, you see. Then I saw the new poster we put up at work. "Everytime you use your Mastercard, a donation is made to the Foundation for Adoption." At first, it made me mad, since it looked like exploitation. Then I realized: it's philanthrocapitalism. I now understand completely. Philanthropy and capitalism go together like two peas in a pod, so to speak.
I think you mistook philanthrocapitalism for a system of its own - it's not; it's simply the incidence of philanthropy within the free market system, I suppose.

I think you mistook philanthrocapitalism for a system of its own - it's not; it's simply the incidence of philanthropy within the free market system, I suppose.

Aye, that's what I did. Though it did lead to BAWAAKnights accusing me of being a commie, which I thought was hilarious.

Aye, that's what I did. Though it did lead to BAWAAKnights accusing me of being a commie, which I thought was hilarious.
Well this is NSG after all - if there is one good assumption to make, it's that. ;) It's changing though... I've noticed a lot of libertarian posters are now on.

Well this is NSG after all - if there is one good assumption to make, it's that. ;) It's changing though... I've noticed a lot of libertarian posters are now on.

To be honest, I was a commie for a short while, before I got my senses back. Happened during that time I had to share a laundry room for a bedroom with my little brother for a year.

To be honest, I was a commie for a short while, before I got my senses back. Happened during that time I had to share a laundry room for a bedroom with my little brother for a year.
Me, I was born soulless. <.<

"Collective valued objectives" are too broadly definable.

Well, in theory democracy is supposed to enable us to determine what our collective goals are, and when some higher objective should trump economic efficiency (which is, after all, only a means to an end). In reality, it probably is only a very rough proxy at best.


Measures that seek to keep the market competitive, to hinder corporations from deliberately misinforming or harming consumers, to maintain decent working conditions for employees etc. are all fine by me -- ie measures specifically aimed at preventing abuse of the individual and at keeping the market free, whether or not they are of collective value.


OK. But reasonable people might disagree on what such measures are needed, and whether government measures taken with these aims actually achieve their aims, or whether they will simply result in unintended effects that outweigh the potential benefits. For example, there is plenty of debate around whether things like Minimum Wage or Health and Safety Regulations actually help those they are meant to help.


I'd prefer a mixture of both, as far as possible. Whichever is more efficient.
Sure. But sometimes fairness or other arguments might trump efficiency. For example, people might reasonably object to the privatization of air on moral grounds or grounds of distributional fairness. If emissions trading can achieve the same goal without the same drawbacks, then we might consider it to be superior, regardless of whether it is more efficient.

Well, in theory democracy is supposed to enable us to determine what our collective goals are, and when some higher objective should trump economic efficiency (which is, after all, only a means to an end). In reality, it probably is only a very rough proxy at best.
Democracy isn't the best way of safeguarding certain aims, such as those that I outlined, given that any real form of it is in effect majority rule. A community firmly convinced of the necessity for a free market and negative rights (e.g. of workers - individuals in general- not to be abused) should carve these principles in stone. Those who dislike it may leave, freely.

OK. But reasonable people might disagree on what such measures are needed, and whether government measures taken with these aims actually achieve their aims, or whether they will simply result in unintended effects that outweigh the potential benefits. For example, there is plenty of debate around whether things like Minimum Wage or Health and Safety Regulations actually help those they are meant to help.

Naturally. All I've done is outlined the aims - I haven't specified the means in this case. :) The Minimum Wage is a good example of a questionable measure. This is where the democratic process kicks in.

Aye, that's what I did. Though it did lead to BAWAAKnights accusing me of being a commie, which I thought was hilarious.
And your denial of it was hilarious. Looks like we're even.

I worked for 4 years at TATA. I have taken part in both their philanthropical and capitalist endeavours. Seeing their success and growth and the respect they have in the society, I guess they can and they do mix well, if managed properly. The company enjoys immense goodwill with Indians. People almost have a patriotic swell when mentioning the name TATA, a far cry from the anti-corporate feeling in many countries.
Probably because TATA takes much more of a social responsibility than other companies.

And your denial of it was hilarious. Looks like we're even.
No, his denial of it was logical, unlike your wild allegations. Is it hard to understand that not everyone who is not in favour of pure unbridled capitalism is a communist?

Well, the word is certainly long and complicated enough to inspire awe in unwitting readers, so the first step towards a functioning political ideology has been made. ;)
Nope. Most kids could pronounce "philanthrocapitalism" right after a few tries. You need something which is not spelt even remotely phonetically. "Bourgeois" for instance. It takes years of practice to spell it right (for instance, I had to use Google, and I'm still not sure it's right) and pronouncing it instantly categorizes you into a "book Marxist" or a "Party Marxist" or a "Fellow traveller/CIA plant."
Philanthrocapitalist. Too easy. I didn't even have to look, let alone cut n paste.

What do you think? Will "Philanthrocapitalism" be the next step as government-based charity and redistribution is made obsolete and counterproductive by globalisation and free trade?
I cannot agree nor disagree with such an omnibus of opinion.

The Nobel Peace Prize this year went to the founder of the Grameen Bank (http://en.wikipedia.org/wiki/Grameen_Bank) - a development lender. No government involved, just one guy with a bit of money and an idea.
Well deserved. The idea that billions of dollars from the stock markets of the world would be as wisely lent out, or that the debtors would honour their debts to Union Carbide or Microsoft as honestly as they do to Grameen Bank is bollocks.

With the media making the problems of the world more and more obvious (even as the traditional forms become gobbled up by rich people with political agendas, alternative news sources are replacing them), and public opinion becoming a real and recognised source of competitive advantage...plus the general feeling these days that the world can do better - do you think that these social venture capitalists will change the world for the better on a grand scale?

Yes!
I welcome every public donation, every gesture of philanthropy by the very rich.
Even if it's just money for publicity, if it's branded sponsorship, that's a step up from buying advertising time. Someone outside of the marketing channel between manufacturer and consumer benefits, and the corporation which donates some of their earnings to alieviating poverty or fair trade practices is acknowledging something other than sheer greed in the consumer, even if their own intentions are purely capitalistic.
The message sent by Bill Gates and Warren Buffet and Bono and the rest are even more effective. The image of great wealth as complete freedom, where you could do whatever you want and the rest of the world just has to watch, was a terrible thing to aspire to. It's an ethos of ruthlessness, where whatever you did to get to 'the top' wouldn't matter, when you got there. You'd have "fuck you money" ... enough money that you could say "fuck you" to anyone.
The very rich are still human, they have as much capacity for compassion as anyone else. The expectation that they (individuals and corporations) should spend a few percent of their earnings philantropically (as many people of moderate and even humble means do) would indeed rival the efforts of government bodies.
But no, government-funded charity isn't going to be obsoleted any time soon. Do corporations fund schools for the public good? (They may contribute, yes) Do they pay to imprison felons, for the public good? No. Do they contribute to national defence for the public good? Hell no, they make a buck off the budget.
Corporate charity will always be a "top-down" form of charity: funding the most visible, the most easily fixed problems. If it's starving children, they'll do great, but if it's something more long-term, or more morally equivocable, like keeping mentally disabled people out of jail or educating women in the third world, they just won't. Charity work is done on the ground by people who focus on the outcomes, not the perception, and commercializing that would be a travesty of charity. There'd be great perceptions of equality and justice, but crap outcomes.

Anyone who read all of that, thanks and sorry. I just had to say it.

No, his denial of it was logical, unlike your wild allegations.
And which allegations were those?


Is it hard to understand that not everyone who is not in favour of pure unbridled capitalism is a communist?
Please quote me where I said that he was a communist. Hint: you won't be able to, since I never said it.

And which allegations were those?



Please quote me where I said that he was a communist. Hint: you won't be able to, since I never said it.

IOW: you don't know what you're talking about. You really shouldn't have posted, given that you just told everyone that you're either so anti-capitalist or so deeply deluded that you're willing to blind yourself to reality in order to save your worldview. Happens a lot among fundamentalists of any sort.

At any rate, philanthropy and capitalism mesh perfectly well. Unless, of course, you believe the myth that capitalists just want to kill everyone with horrible products, starve the workers with "slave wages", and generally "horde" all the money they have in a mattress.

No, you didn't say it in so many words. But you did imply it through use of phrases like "so anti-capitalist" calling me a fundamentalist, using it in the sense of a synonym to extremist, and stating that I believe the dog-eat-dog myth of capitalism. You called me a communist, whether you used the word itself or not.

IOW: you don't know what you're talking about. You really shouldn't have posted, given that you just told everyone that you're either so anti-capitalist or so deeply deluded that you're willing to blind yourself to reality in order to save your worldview. Happens a lot among fundamentalists of any sort.

At any rate, philanthropy and capitalism mesh perfectly well. Unless, of course, you believe the myth that capitalists just want to kill everyone with horrible products, starve the workers with "slave wages", and generally "horde" all the money they have in a mattress.
No, you didn't say it in so many words. But you did imply it through use of phrases like "so anti-capitalist"
EITHER so anti-capitalist OR....

You really should read.

So no, I didn't call you a communist, not even in so many words.

EITHER so anti-capitalist OR....

You really should read.

So no, I didn't call you a communist, not even in so many words.

You know, if it weren't for the fact that he's BAAWAKnights, I'd start pointing out the flaws in his argument, like how the or part was calling me deeply deluded and blind to reality, and how he should listen to his own advice. But he won't listen. So instead, I'll just shut up and stop driving this thread off-topic.

You know, if it weren't for the fact that he's BAAWAKnights, I'd start pointing out the flaws in his argument,
Except, of course, that there aren't any.


So instead, I'll just shut up and stop driving this thread off-topic.
That's about the first intelligent thing you've said.

Except, of course, that there aren't any.

That's about the first intelligent thing you've said.
Why do you debate so aggressively?

Why do you debate so aggressively?
Why not?

Democracy isn't the best way of safeguarding certain aims, such as those that I outlined, given that any real form of it is in effect majority rule. A community firmly convinced of the necessity for a free market and negative rights (e.g. of workers - individuals in general- not to be abused) should carve these principles in stone. Those who dislike it may leave, freely.

If your concern is the protection of individual rights, then surely a liberal democracy allows for that by constitutionalizing or otherwise enshrining the rights that you mentioned. And other than where those rights are engaged, decisions should be by majority rule. This of course requires people to make political trade-offs (i.e. sacrificing what they want on certain issues or giving others what they want on certain issues) in order to achieve some of what they want. Almost a marketplace of votes if you will.

If your concern is the protection of individual rights, then surely a liberal democracy allows for that by constitutionalizing or otherwise enshrining the rights that you mentioned. And other than where those rights are engaged, decisions should be by majority rule. This of course requires people to make political trade-offs (i.e. sacrificing what they want on certain issues or giving others what they want on certain issues) in order to achieve some of what they want. Almost a marketplace of votes if you will.
I am hoping that one day individuals will be able to freely secede and form their own communities so as to create a greater diversity of possible habitats. For instance, a minarchist community would make promoting a (genuinely, as I specified) free-market its sine qua none; those who don't like it could venture elsewhere and set up something more to their liking. I dislike compromise, and I think this would break the monotony of our overbearingly dull world.

I am hoping that one day individuals will be able to freely secede and form their own communities so as to create a greater diversity of possible habitats. For instance, a minarchist community would make promoting a (genuinely, as I specified) free-market its sine qua none; those who don't like it could venture elsewhere and set up something more to their liking. I dislike compromise, and I think this would break the monotony of our overbearingly dull world.

Interesting ... when do you forsee this becoming a reality? How do you avoid a free-rider problem in relation to addressing certain global issues? (e.g. how do you ensure that all communities pull their weight on issues like climate change, or rather prevent them from imposing the burden of their activities on others)?

Interesting ... when do you forsee this becoming a reality?
When people are willing to make it one. That is when. Here is an example of such individuals: http://www.strike-the-root.com/62/olesen/olesen1.html

How do you avoid a free-rider problem in relation to addressing certain global issues? (e.g. how do you ensure that all communities pull their weight on issues like climate change, or rather prevent them from imposing the burden of their activities on others)?
As we do now. No country or community should be violently coerced into something against its will -- sanctions and other global market mechanisms on the other hand, could prove most convincing in an economically interdependent world. Some have envisioned confederalism as the ideal solution, but I think it will only end up leading to more centralization.

As long as powerful Nation-States exist, the free-rider problem will intensify, not weaken.

No country or community should be violently coerced into something against its will --
Sure they should ... when they are breaking the law or other agreed upon social norms, or harming others through their behaviour.

Sure they should ... when they are breaking the law or other agreed upon social norms, or harming others through their behaviour.
Yes, this implies they are the aggressor though and that the other party is taking defensive measures. What I mean is it is otherwise unacceptable to simply invade other nations simply because we have a dislike for what they do -- it's tantamount to what Bush is doing now.

Why not?
Because every argument you're in seems to break down into personal attacks pretty fast, and that is obviously not conducive to reasonable discussion.

Because every argument you're in seems to break down into personal attacks pretty fast,
No, it doesn't.

I'll tell you what isn't conducive to reasonable discussion: people who have done no research or so little that it's indistinguishable from no research who then believe they are experts at a topic because of their feelings or what they were taught from a high school text. That's just a recipe for disaster.

Which would be totally worthless if the entire populace was composed of subsistence farmers who had no money at all. Mandatory purchasing laws in, say, Zimbabwe, would be totally ineffective.Eh...I suppose it would depend on how dictatorial the government is.

Well, if temporary dependence on a business is the price of development, I'd be totally willing to live with that.How can we be certain the dependence is merely temporary?