Confronting Capitalism: A book review by Bob Morris

Posted on: April 3rd, 2015 by bobmorris

Confronting CapitalismConfronting Capitalism: Real Solutions for a Troubled Economic System
Philip Kotler
AMACOM (2015)

“If you think education is expensive, try ignorance.”
Derek Bok

In my opinion, Phil Kotler is the world’s preeminent authority on how to create or increase demand for whatever is offered for sale or trade. In a word, marketing. Therefore, it comes as no surprise that his latest book offers “real solutions for a troubled economic system” in a global marketplace. Economics (for better or worse) provide the infrastructure for commerce. Having earned a Ph.D. degree in economics (1956) from the Massachusetts Institute of Technology (M.I.T.), Kotler is a results-driven empiricist who applies his pragmatic skills to a range of immensely complicated problems that include poverty, income inequality, workers under severe pressure, job creation despite growing automation, ignoring or underestimating social costs,” environmental exploitation, the dangers of narrow self-interest, the debt burden at the federal/’state/county/local levels, and politics’ subversion of economics. These are indeed very serious issues and Kotler minces no words when sharing his thoughts and feelings about how to establish and then nourish/sustain high-performance capitalism.

For example, in the first chapter, he identifies what he characterizes as “the fourteen shortcomings of capitalism.” One of his primary objectives in the book is to0 examine each of them as well as the underlying fo0rces and causes – and propose possible, plausible solutions. “This book discusses how capitalism plays out in the United States as in many other countries of the world. As more countries move to a higher level of economic development, their problems will resemble more closely the problems, and the solutions, that play out in the United States.”

These are among the dozens of passages of greatest interest and value to me, also listed to suggest the scope of Kotler’s coverage:

o What Is Capitalism? (Pages 7-10)
o The Fourteen Shortcomings of Capitalism (12-15)
o The Causes of Poverty (19-23)
o Solutions to Poverty, and, Approaches to Helping the Poor (23-25 and 27)
o Thomas Piketty Arrives On the Scene (31-32)
o Dangers of the Inequality (39-42)
o Policies for Reducing the Great Differences In Incomes (42-55)
o Alternative Proposals to Help Workers Get a Living Wage, and, The Issue of Worker Dissatisfaction on the Job (72-77)
o The Impact of Technology, Fewer Jobs for More People, and, Who Will Be Affected Most? (80-86)
o Companies Avoiding Social Costs (96-99)
o The Rise of the Environmental Movement, and Companies Adopting an Ecological Consciousness (107-110)
o The Problem of the Business Cycle (116-119)
o The Sources of Turbulence (122-134)
o The Case for Individualism and Self-Reliance (136-139)
o The U.S. Great Recession: 2008-2011 (150-152)
o Solutions: Measures to Regulate the Financial System (161-165)
o Lobbying (168-176)
o Maintaining and Improving Infrastructure (184-186)
o How to Change the Culture of Consumerism (204-206)
o Two Major unresolved Issues: Jobs and Corporate Support for Sustainability (206-209)
o The Role of Materialism in Relation to Happiness and Achieving Happiness Without Materialism (217-222)

As Kotler carefully explains throughout his lively and eloquent narrative, “The fourteen shortcomings are not independent of each other. They are highly interrelated. The problem of poverty is part of the problem of income inequality, which itself is leads to low demand, which leads to too much unemployment, which leads to a clash between austerity and stimulus as two potential remedies, which is handicapped by political lobbying that gets legislators to vote for the causes that will keep them in power and therefore not vote for financial regulation and more environmental; protection, and so on.

“All this means that in working on any one problem, such as higher minim um wages, so many other issues come into play, such as some businesses possibly closing down, thus creating fewer jobs and more unemployment and incentivizing companies to import more goods from abroad, which leads to even less employment at home, and so on.”

I agree with this overview. At the same time, I think it is more possible than ever before to diminish the nature and extent of some problems in one area such as unemployment that will, in turn, diminish the nature and extent of problems in other areas such as income inequality. Moreover, I think that communication, cooperation, and (most important of all) collaboration between and among federal, state, county, and local governments can increase and improve — during the problem-solving process — if more efficient use is made of various electronic technologies.

Philip Kotler will not — because no single person can — solve all the problems in our troubled economic system but he does provide in his latest book an agenda, a mindset, a rationale, and a game plan that can have significant impact if (HUGE “if”) enough people become engaged in achieving goals that will accelerate personal growth and professional development throughout and beyond the United States. In this context, I am again reminded of an observation by Margaret Mead: “Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.”

* * *

Those who share my high regard for this book are urged to check out three others: John Bogle’s The Clash of the Cultures: Investment vs. Speculation, Roger Martin’s Fixing the Game: Bubbles, Crashes, and What Capitalism Can Learn from the NFL, and Robert Frank’s The Darwin Economy: Liberty, Competition, and the Common Good.

Philip Kotler is the S. C. Johnson Distinguished Professor of International Marketing at the Kellogg School of Management. He has been honored as one of the world’s leading marketing thinkers. He received his M.A. degree in economics (1953) from the University of Chicago and his Ph.D. degree in economics (1956) from the Massachusetts Institute of Technology (M.I.T.), and has received honorary degrees from twenty-one foreign universities. He is the author of over 57 books and over one hundred and fifty articles. He has been a consultant to IBM, General Electric, Sony, AT&T, Bank of America, Merck, Motorola, Ford, and others. The Financial Times included him in its list of the top 10 business thinkers. They cited his Marketing Management book as one of the 50 best business books of all times. More is available on www.pkotler.org

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