Climate and Capitalism
Is a desire to always have “more” a fundamental feature of human nature? In Mindful Economics, Joel Magnuson explains how consumerism was deliberately created to meet capitalism’s need for constant growth.
From Chapter 9 of Mindful Economics: How the U.S. Economy Works, Why It Matters, and How It Could Be Different, by Joel Magnuson. published by Seven Stories Press, New York. Copyright © 2007, 2008 by Joel Magnuson.
The Growth Imperative: Prosperity or Poverty
Generating a measurable rate of return for investors is the core element of any capitalist economy. Investors derive their income from percentage returns on stocks, bonds, or other business investments. If investors do not get these expected returns, they will sell their investments and seek returns elsewhere. By disinvesting, or cashing out, investors can drive down the book value of a company, which can ultimately cause the business to fail. To prevent this outcome, the prime directive of a capitalist business is to sustain robust returns and growth of financial wealth for their investors. This is the paramount goal of capitalist enterprise.
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