What is human-centered capitalism?

I’ve been trying to write this article for several weeks, but I’ve been travelling, busy doing other things, and to be honest, procrastinating, and now that Andrew Yang, the Silicon Valley entrepreneur that was running for the democratic party primaries until some days ago, has left the race, it is a good moment to talk about this. It was one of the main topics on his policy programme, not as relevant as his Freedom Dividend which is basically a UBI (universal basic income) of 1000 dollars every month to every American, but a very interesting one and from a realistic and honest point of view.

The idea was introduced in his book “The War On Normal People” in 2018 where he explores the idea of universal basic income and other ideas concerning the future like the automatization of jobs and the idea this article is about. As an entrepreneur and son of immigrants, he has seen the positive aspects of capitalism, but at the same time, he has seen how this system does not always work towards the well-being of humanity and focuses on monetary gain. Capitalism has won the war of ideas by generating immense growth and wealth all over the world, especially for the last 50 years, humanity has never been this well-fed, literate, healthy, war-free or almost any other positive metric, but this does not mean that there is no room for improvement, obviously, there is.

The main core ideas of this so-called Human Capitalism would be:

1. Humanity is more important than money.

2. The unit of an economy is each person, not each dollar.

3. Markets exist to serve our common goals and values.

One thing I really appreciate from his point of view is that he recognises that we are not living in a purely capitalist society, this is just a form of institutional capitalism and corporatism. He is obviously no fan of big government because he knows that larger the organization is, the more inefficient and ridiculous it often gets. But in his opinion, it is the best tool to implement the needed changes to our economic system. Our emphasis on growing the GDP is not working for most people and does not always mean that everybody’s lives improve, so this should not be the main metric we use to judge a country for. This is something I realised last semester in my course Measuring and Managing Performance, where the first lecture was about how crucial is what we measure in order to achieve the objective. As I was told in class and Yang says “what gets measured gets managed for”.

Some of the metrics he believes are relevant to keep track of and pay attention to, and I really like to would be:

• Average physical fitness and mental health

• Quality of infrastructure

• Marriage rates and success

• Deaths of despair; substance abuse

• Global temperature variance and sea levels

• Re-acclimation of incarcerated individuals and rates of criminality

• Dynamism and mobility

• Social and economic equity

• Civic engagement

• Cybersecurity

• Responsiveness and evolution of government

Another way of achieving this that does not necessarily involve the government would be through education, not just in schools, but a change in society’s values. As Adam Smith said in The Wealth of The Nations in 1776, there is an invisible hand who guides the market, but this invisible hand is us, each one of us. The market provides what society demands, and we should create the incentives for the market to focus on what really makes our lives better, and not on fast fashion, fast food, or other products that society consumes that in my opinion are not positive in the long term. 

Sometimes people confuse capitalism with consumerism, but the main idea of capitalism is to save money and invest it to increase productivity and therefore create (potentially) more value for everybody. All this in a free market framework in which competition would push people and companies to create as much as they can and as efficiently as they can of what people demands, which sadly is not necessarily valuable for them because humans are not perfect and want products that does not add net positive value, but this a topic for the next article. So if we change our habits and shopping towards a more meaningful life, and inform the market of what we value, and what we really want, we may achieve betterment in our society.