By Robert B. Reich
Author Robert Reich, a professor of public policy at the University of California, Berkeley, is both a scholar and policy practitioner. As U.S. labor secretary under President Clinton, he participated in policy making during the globalization and investment growth trends of the 1990s. Supercapitalism is Reich’s assessment of how the world has become supercharged in all aspects of business, government, and society.
Reich’s central argument is that free market capitalism in the United States is booming, while democracy has weakened-primarily due to the negative convergence of these two philosophies. U.S. capitalism deals with corporations, which are a collection of laws, contracts, and resources charged with supplying customers and investors great deals. Democracy is designed to organize the manner in which society achieves the goals of independent citizens. Reich observes that of the top 100 economic entities in the world, more than half are corporations. His book sheds light on both the positive and negative consequences of this apparent imbalance between the capitalistic firm and the democratic society.
Supercapitalism refers to the timeframe extending from the 1970s to the present, a period in which large firms have become much more competitive, global, and innovative. Reich asserts that everyone-from the schoolteacher who has retirement plans tied to mutual funds, to the CEO whose job is directly aligned with shareholder satisfaction, to a member of the global labor pool-is of two minds on this growth of capitalism. While our wallets might appreciate Wal-Mart, for example, for its low prices, our consciences question the fact that in two weeks, its CEO earns what most of its employees earn in a lifetime.
Students and practitioners of business are challenged now more than ever to be accountable for their decisions as they manage risk in this new century. No longer is the CEO a corporate statesman; rather, he or she is a manager of extensive risk for competitive worldwide resource allocation. Supercapitalism is important reading for managers because it provides them with a necessary understanding of capitalism’s impact in the last hundred years.
Reich’s lessons illustrate the complexity of the current “super-capitalistic” marketplace against a background of “super-political” polarization. He believes that participants in this economy will enjoy greater returns when capitalism and democracy find their natural equilibrium, that is, when the influence of one upon the other brings not only more prosperity, but more freedom for all concerned.