The U.S. economy is increasingly run by a “visible hand” instead of Adam Smith’s “invisible hand.” Large sectors of the economy are guided by a few powerful companies. The question is whether the visible hand runs these sectors with Smith’s “enlightened self-interest” or with just “self-interest”, according to Philip Kotler in his book Confronting Capitalism: Real Solutions for a Troubled Economic System.
The book enumerates fourteen different problems which the author sees with capitalism, ranging from increasing income inequality and persistent poverty to the dangers of narrow self-interest and the ways in which politics subverts economics. The identification of the fourteen issues is largely uncontroversial, although some might categorise them differently or combine some together. It is the author’s prescriptions for change which are likely to be wildly controversial.
It seems ironic that capitalism, as a system apparently built essentially by neglect as each person pursues his or her own interests in a rational manner, should be the subject of passionately held beliefs raising it almost to the level of a religion. I suspect that, by proposing a number of solutions which interfere with the sacred tenets of the free market, the author will be calling down on his head the wrath of the devotees of laissez-faire.
Readers who have little or no knowledge of economics and how capitalism works will find this book helpful if they keep in mind that many of the author’s simple-sounding solutions are highly controversial and unlikely to be adopted by any government which relies on support from wealthy citizens.