The Spirit of Capitalism
- Karen Kuykendall
- Jul 25
- 7 min read
Updated: Jul 25
This post is the second in a five-part series on the real purpose and spirit of capitalism. You can begin the series here.
Last week, we took a brief look at the purpose of capitalism. While traditionally the intent was to "emerge from the drudgery of subsistence living," the ethical - or virtuous - side of capitalism's purpose goes far beyond that goal and seeks overall human flourishing, which is "wellbeing in all of its forms - economically, socially, spiritually, physically, and politically."
How do we attain this ideal for everyone from the wealthiest entrepreneur to the average hourly wage worker? As with anything else, it starts with attitude; in this case, the sincere desire for everyone's economic well being. Seeking this goal with the right spirit makes all the difference in whether or not virtuous capitalism can hold up over the long run, both in our businesses and in our personal lives.
As noted in last week's post, this endeavor needs everyone's participation to work. Though the attitude is the same (i.e. the desire for economic well being) no matter what part you play, the practical applications will vary, so let's see how this spirit would play out in the various roles below.
The Business Owner/Corporation
"Culture eats strategy for breakfast." - Peter Drucker
One of the easiest ways to assess the spirit of a particular business is to take a look at its culture. In a post from 2023, we contrasted two workplaces from Charles Dickens' A Christmas Carol - Scrooge's office and Fezziwig's warehouse:
The door of Scrooge’s counting-house was open that he might keep his eye upon his clerk, who in a dismal little cell beyond, a sort of tank, was copying letters. Scrooge had a very small fire, but the clerk's fire was so very much smaller that it looked like one coal. But he couldn’t replenish it, for Scrooge kept the coal-box in his own room; and so surely as the clerk came in with the shovel, the master predicted that it would be necessary for them to part. Wherefore the clerk put on his white comforter, and tried to warm himself at the candle; in which effort, not being a man of a strong imagination, he failed.
Compare this miserable environment with that of Scrooge's first employer, Mr. Fezziwig:
"Hilli-ho!" cried old Fezziwig, skipping down from the high desk with wonderful agility. "Clear away, my lads, and let's have lots of room here! Hilli-ho, Dick! Cheer-up, Ebenezer!" Clear away! ... It was done in a minute. Every movable was packed off, as if it were dismissed from public life forevermore; the floor was swept and watered, the lamps were trimmed, fuel was heaped upon the fire; and the warehouse was as snug, and warm, and dry, and bright a ballroom as you would desire to see on a winter's night...When the clock struck eleven, the domestic ball broke up. Mr. and Mrs. Fezziwig took their stations, one on either side of the door, and shaking hands with every person individually, as he or she went out, wished him or her a Merry Christmas!
The business owner or corporation has many opportunities to convey the spirit of virtuous capitalism. First and foremost, employees are to be treated well, including being paid a fair wage. "The worker is worthy of his wages" (I Timothy 5:18). Being generous with employees is not only the right thing to do, it creates loyalty and fosters a positive atmosphere, which in turn is good for business. The right attitude is also open to feedback and innovation, which not only makes employees feel valued but also contributes to making a company more competitive and profitable.
The second application of the right spirit is to be mindful of how a product is produced and what effect it has, especially if you are a larger corporation with many moving parts. It involves considering the sourcing of materials, the treatment of all workers along the supply chain, and the overall impact of the product on the environment and people's wellbeing. Examples of companies who have followed this model and been overwhelmingly successful are Patagonia, Mars, Inc., Notre Dame Federal Credit Union, and businesses that are part of the B Team and B4IG.
A third application is producing a product that is of true value to its users. Instead of developing an item or service with a planned obsolescence model, quality and good service are the primary goals of something produced in the right spirit. With the expansion of national and global markets, the right strategy not only wins more customers in the long run, it also builds brand loyalty and is a win-win for everyone.
A fourth way is to keep the long game in mind. While quarterly profits may be the primary focus of many businesses, those with the right spirit are unruffled by normal fluctuations because they know that they are pursuing a model that works. The goal is to optimize, not maximize, profit, and that is a long-term pursuit. Toyota is a great example of a corporation that has, over the years, kept its eye on the right target.
The Employee
We often talk about the employer's role in better capitalism, but the employee has an important part to play as well. Colossians 3:23 says "Whatever you do, work at it with all your heart, as working for the Lord, not for human masters." By going to work faithfully with the commitment to do their best, employees contribute to and continue the cycle of wellbeing. Without this kind of effort on their end, all the well-intentioned efforts of an employer would eventually come to nothing.
Employees with the right spirit will also go beyond what is required, looking for ways to make the business better and more profitable. When an employer is open to this kind of input and the employee gives it, true innovation occurs and real progress is made.
The Consumer/Citizen
The final role we'll look at is that of the consumer/citizen, which of course, is everyone. Whether as an individual or a business, there are several things that the true spirit of capitalism requires us to be aware of and pursue in the right way:
Ethical Buying
While buying ethically sourced items can be a real challenge, the responsibility falls on both businesses and individuals to be mindful of this issue. If a company or person becomes aware of a problem with a particular product, the spirit of virtuous capitalism does not allow it to be brushed aside. Instead, it requires consequential action, whether that means finding another source or confronting the problem directly.
Charitable Giving
Generosity is the heart of virtuous capitalism. We are to share our good fortune with those who are less fortunate, and in a way that makes a real difference in their lives. Charitable giving comes in many forms. We often think of charity solely as monetary donations, but investments of time are equally valuable. Whether the contribution comes through giving to a non-profit, building homes with Habitat for Humanity, serving food at a local rescue mission, or assisting an elderly next door neighbor, we are all commissioned with investing in our community in some way.
Voting
As we think about what kind of initiatives and laws promote the spirit of virtuous capitalism, we can and must apply its principles to the ballot box. Whom and what we vote for should reflect a desire to promote wellbeing throughout our community, our state, our country, and the world. To do so means to be well read on the issues and exercise the right to vote whenever it is offered. Not only does this model support our democracy, it ensures the best chance for real and positive change.
Finally, I'd like to reference the book Economic Justice For All: A Pastoral Letter on Catholic Social Teaching and the U.S. Economy. Published in 1986 by the National Conference of Catholic Bishops, it offers and examines basic moral principles that frame what the economy must serve and the standards it must meet. The introduction to the book states its purpose:
We are believers called to follow Our Lord Jesus Christ and proclaim his Gospel
in the midst of a complex and powerful economy. This reality poses both
opportunities and responsibilities for Catholics in the United States. Our faith calls
us to measure this economy, not only by what it produces, but also by how it
touches human life and whether it protects or undermines the dignity of the human
person. Economic decisions have human consequences and moral content; they
help or hurt people, strengthen or weaken family life, and advance or diminish the
quality of justice in our land.
Regardless of our faith traditions, I think we can agree that this statement expresses the true spirit of virtuous capitalism - looking out for each other as we work toward a flourishing economy and a good life for everyone. In what ways can you live out this spirit in your personal life and in your workplace during the coming weeks?
Our vision is to benefit society by transforming capitalism's current core ethic of 'maximize shareholder value' to the better core ethic of 'optimize mutual value.' We achieve our vision by impacting learning, opinion, beliefs, and policy. Institute for Better Capitalism, Inc.
⭐⭐⭐⭐⭐ Our Amazon number 1 new release: Unleash more with Better Capitalism: Jesus, Adam Smith, Ayn Rand, & MLK Jr. on Moving from Plantation to Partnership Economics.
"This book merits close, sustained attention as a compelling move beyond both careless thinking and easy ideology."—Walter Brueggemann, Columbia Theological Seminary
"Better Capitalism is a sincere search for a better world."—Cato Institute
Comments