In light of the eurozone crisis which has taken the international stage, Noreena talks about her ideology.
“Eco: Prof. Hertz, you recently came to Reggio Emilia to promote the idea of Co-op Capitalism, an expansion of the American slogan "Yes We Can". Did this idea that you had in 2009 come about because of the need for a new economic model, or as a consequence of societies becoming more global because of the internet, social media and digital communications?
NH: The financial crisis was a clear manifestation of the flaws in old style Capitalism - what I have called Gucci Capitalism - an ideology that lionesed the market, demonised the state and had little interest or concern about society. Under Gucci Capitalism - Greed was good, man selfish, and Bernie Madoff was the hero.
It became clear to me that we needed a new political ideology to steer us - one whicn valued society, acknowledged that the roles of market and government often nowadays overlapped, understood, recognised and supported the collaborative ethic, and saw the value in networks and relationships.
“Eco: What are the strengths and weaknesses of our "co-operative" model? How can we make it more palatable to those of all political alignments, since (at least in Italy) the word has strong leftist connotations?
NH: Strong points are how well the model is doing - companies that have existed for generations; corporations that are weathering the recession much better than others; a region that is one of the most succesful in Europe.Weak points: When co-operation becomes consensus there can be a loss of innovation and also of governance - the challenge for co-operatives is how to nurture and promote dissent within the collaborative model.
Co-op Capitalism is not about left or right. Valuing relationships and society is not an issue of left or right. We see examples of the Co-op Ethic - such as collaboration in Reggio Emilia but also in Silicon Valley. Some of the greatest business successes in recent years, whether Wikipedia or LinkedIn, share a lot with the Co-op Values and mindset .
“Eco: What little things could the public and those who are not inside the economic system do to promote this model? Does the push have to come from high (governments) or low (the people)?
NH: This is a project that is both top down and bottom up. Governments have a role to play in rethinking what they value and what they measure. Should we determine economic success purely on the basis of GDP for example? What tax structures can best foster collaborative long term thinking? But citizens have a role to play too. In rethinking what matters to them. In forging relationships and networks and tending to them. In strengthening their communities - virtual and physical. In thinking about the consequences of their actions not only as they effect them and their closest family, but how they impact those in their community and the wider society more generally.
“Eco: In terms of capitalism, who,in your opinion, has the power now? Is it still the big multinational companies? Or are other entities are becoming more powerful (I refer to media or single person with a wide net of powerful contacts, as we can see in the italian news...)?
NH: The financial crisis made manifest just how powerful big companies - in that case banks were - and how ordinary people were powerless in the face of them. But other sectors are powerful too and running equally amok. In Italy you have serious issues of media concentration and ownership that to an outsider look to fundamentally threaten democracy. But in the UK too we have our own problems relating to media power - the Murdoch saga that has unfolded this week in the UK with evidence coming out of illegal phone hacking into phones of ordinary and vulnerable people has laid bare the dangers of media operations running amok - and the dangers of not ensuring strong regulation of our media.
But even at these times we do see cases of people wielding power. In the Murdoch/UK case, Tesco, the UK's biggest retailer announced that it was not going to withdraw advertising from the Murdoch Newspaper News of the World in the light of the revelations, the British public took to the internet and tweeted their disgust in huge numbers. This twitter revolution had an impact, Tesco reversed it's decision and within hours the News of the World had closed down. So even in a world of unequal power - people can do something and can, together, have a signficant impact
“Eco: You were very critical of multinational companies. But things have changed since 2003 and every company now tries to be (or communicate the image of being) very ethical...or do they?
NH: There are a number of big mulitnational companies now that are taking issues of sustainabilty and social responsibility really seriously now. Unilever recently made signficant pledges with regards addressing global hunger. Pepsico is investing serious funds into developing foods with special nutritional value to deal with vitamin deficiencis in developing countries. GE is investing huge resources into Research into energy efficiency issues. There is a group of business leaders - I call them "legacy leaders" - who are making meaningful strides forward nowadays. Whilst this is a relatively new phenomenon the scale of their commitment is signficant and exciting. And it's not that they are only driven by ethics. They have identified clear business reasons for taking these steps. These are win wins - wins for sociey and wins for business.
“Eco: Is there something you would save from the Thatcher or Reagan eras?
NH: The innovation that comes about from being able to create but also destroy ideas.”
Copyright Speakers Corner 2016