From the Gilded Age of Capitalism to a Golden One – Part 1 of 3

Up until Covid struck, popular culture felt like a gigantic immersion into the land of the fabulous.

By Rob Schuham, Co-Founder of Undercurrent

Up until Covid struck, popular culture felt like a gigantic immersion into the land of the fabulous. The fashion and entertainment industries were on a hot streak, celebrities luxuriated in exotic destinations, music and art festivals thrived, real estate was booming, corporations enjoyed outsized market valuations, and restaurants, bars and cultural attractions overflowed. Startups were rocking, and even failure was considered a badge of courage as you could easily get funding to try all over again. Unemployment was at record lows. It was a “workers market.”

Or was it? Were people’s real lives the same as their digital personas? Was the bubbly economy felt everywhere? Was any of this a true reflection of culture across America and the world? Was this going to continue forever? Were things lurking beneath the gilded surface that were too dark to see? Or simply too uncomfortable to confront on an individual level? Where was Main Street in this picture? Where were the disenfranchised? Or the workers whose average compensation is 278 times less than the average CEO?

Too late, we now all have a sense that something failed us. We can blame the nature of the pandemic. We can blame the continuing ineptness of leadership at the federal and national levels in the U.S. and around the world. But that culpability is ultimately on all of us too. It’s not just a partisan issue (although some of it certainly is). We all contributed to the systemic failure that created the conditions for pandemics in the first place. We all bought into the stories and mythologies of capitalism as we knowingly or unknowingly purchased products that were made by (or services provided by) corporately-irresponsible organizations. Every to-go cup of coffee you sipped on, every plastic bottle of water you drank, every new countertop appliance you bought off Amazon and every new smartphone made of mined minerals. And you may even own stock in some of them.

When I say “we,” I’m not pointing a finger at you. I’m pointing a finger at all of us. You may be in the small minority of people that not only revolted against the “system” (I’ll get into that later), but practiced social responsibility at a deep level. You may drive around in an electric car or hybrid, eat organic food grown locally, drink local micro-brewed beer, and have a small carbon footprint in general. If you do, great! But you would be in a privileged position vs. the rest of the country, and the world. Chances are, if you have a 401K and aren’t divested of fossil fuel corporations, toxic chemical companies and processed food giants, or you travel by air frequently, attend large high-carbon-footprint events, and are just living the best life you can, you are indeed a part of the problem. We all are! You’re not a villain, rather you’re a “bit actor” in a much larger game that tilted the board of humanity into a false sense of security because we’re all drinking from the same gilded capitalism goblet.

Many of us have been thinking about and talking about the need for a more socially responsible version of capitalism for years now. We cross our fingers with every new administration, every recent election cycle, every TED conference, World Economic Forum and UN General Assembly, every time we break a new temperature record. We talk about it all the damn time. So maybe the question of the moment is what’s different now?

The answer is that we are actually in a very different moment. In fact it’s one of the most radical and altering moments in over a century; an unprecedented confluence of crises; health, medical and financial. Together these three are hyper-acute, resulting in record unemployment, record gyrations in the equities markets, but most importantly, pain, suffering and death (some of which was clearly avoidable). This is magnified by a glaring lack of coordination, intelligence and political will at the federal government level to manage all of these interconnecting vectors, thus worsening and prolonging the problems.

But what dimensionalizes this even further is that other existential threats have not disappeared by any means. The climate crisis is still here (albeit we’ve had a quarantine-correlated 25%+ reduction in CO2 and methane emissions from January to March). Asymmetrical nuclear threats, the weaponizing of AI and/or nanotechnology, the crisis of runaway technology, the chemicals all around us and in us, and of course threats of other pandemics, both zoonotic as well as bioengineered, are all still very possible. And there are the unknown unknowns; cyber and/or terror attacks while we’re distracted and weakened, natural disasters and others only captured in the most dire risk assessment models that could result in a flock of black swans.

Let’s focus on two systemic failures that collided to ignite and create the crisis we’re currently in, climate and health. John Fullerton, Founder of The Capital Institute, shines a light on “the relentless pursuit of shareholder value in the name of capital efficiency” that’s extended man’s footprint into forests, savannas, ice shelves and a multitude of delicate ecosystems all over the world. As a result, zoonotic transfers of diseases from animals to humans will continue to occur and spread as a result. And we live in an era where someone can go from the deepest jungles to a pub in London in 24 hours. Or in this case, a business meeting in a city in Asia that has a wet-market to a crowded restaurant In Milan in roughly the same amount of time.

So now we have a direct correlation. But this has also created an unforeseen real-life proxy. These two fragile “system actors” are also colliding in other ways. To paraphrase a recent McKinsey article, “Addressing Climate Change in a Post-pandemic World,” climate risks and pandemics are similar in that they both represent physical shocks, which then translate into an array of socioeconomic impacts. By contrast, financial shocks alone are largely driven by human sentiment, and are only remedied through restoration of confidence. Physical shock can only be remedied by addressing the underlying causes. Our recent collective experience has been far more shaped by financial shocks than physical ones. But the pandemic offers us a taste of what a full-full-fledged climate crisis could entail in terms of simultaneous exogenous shocks to supply and demand, disruption of supply chains and global transmission and amplification mechanisms.

This is all scary. But this is also a pivotal moment in human history that could result in a significant transformation, the likes of which we’ve never seen. A collective recognition that we need to change things post haste. For an inflection point to vector in a net positive way we need to undergo a deep examination and re-imagining of large swaths of our governance, social and healthcare systems. We also need to closely look at the fragile economic systems we exist in and re-think the tenants and levers of capitalism which not only have culpability in the stunning collapse of so many economies of “stable” developed nations, but as explained earlier, are having a direct impact on the causal roots of the very health crisis we are facing in the moment.

This all translates to a critical need for re-designing and re-engineering our larger systems so as to massively decrease fragility. We need to usher in a new era of human and planetary resilience. An era of regeneration, circularity, connection, collaboration, healing and overall wellbeing for life.

This is far from a novel idea. At Undercurrent, we are part of a chorus of growing calls for companies to leverage this time as a phase-shift for capitalism. In this novel moment the forces that pull the levers of governance and democracy are confronting the exact same thing: A common enemy that unites all of us.

So the next question is the “how?” Here’s where it starts getting good. We are already doing it.

Never before have we seen a global consortium of corporations radically collaborating with each other as they are now. In this case, it’s to solve a problem of the commons. Companies have stepped up in incredible ways. Whether it’s manufacturers shifting production lines to produce much needed frontline medical equipment, or the bio-tech world coordinating and rapidly prototyping health solutions, companies are opening up IP and data sharing in an unprecedented fashion.

Companies are learning new skill-sets in collaboration (vs. competition). Leadership and workforces are feeling a generational call to be a part of a collective set of solutions, to save lives and to reduce human suffering. They are also fighting for their own sovereign economic survival at the same time. Truly unprecedented.

So what does a path from the gilded version of capitalism we just left behind to a golden one look like? How do we take these new skill-sets and ways of working and turn them into muscle memory? Is there a chance we can even habituate them? Can we aim the collective towards solving other existential threats, or find opportunities inside the problems that translate to mutual prosperity? Let’s look at a potential path, including “watch-outs,” that moves us to a world we all want to see. From this introduction, we’ll explore the following over the next two weeks:

Phase 1: Wartime Efforts
Phase 2: Existential Collaboration
Phase 3: Circularity and Regeneration
Phase 4: Governance and Policy