Confronting Capitalism: Real Solutions for a Troubled Economic System

by Philip Kotler

Overview

With one side of the political aisle proposing increasingly more socialistic and anti-capitalistic ideas, the other side has been quick to defend our country’s great economic model, with good reason. Capitalism—spanning a spectrum from laissez faire to authoritarian—shapes the market economies of all the wealthiest and fastest-growing nations. But does that mean it is perfect as is, and that we would not all benefit from an honest evaluation and reconstruction of the free market system that has shaped our country’s way of economic growth? The truth is, trouble is cracking capitalism’s shiny veneer. In the US, Europe, and Japan, economic growth has slowed down. Wealth is concentrated in the hands of a few; natural resources are exploited for short-term profit; and good jobs are hard to find. In Confronting Capitalism, business expert Philip Kotler explains 14 major problems undermining capitalism, including:• Persistent and increasing poverty• Automation’s effects on job creation• High debt burdens• Steep environmental costs• Boom-bust economic cycles• And moreBut this landmark book does not stop with merely revealing the problems. It also delivers a heartening message: We can turn things around! Movements toward shared prosperity and a higher purpose are reinvigorating companies large and small, while proposals abound on government policies that offer protections without stagnation. Kotler identifies the best ideas, linking private and public initiatives into a force for positive change, and offers suggestions for returning to a healthier, more sustainable capitalism that works for all.

Product Details

ISBN-13:	9780814436455
Publisher:	AMACOM
Publication date:	04/15/2015
Pages:	256
Product dimensions:	6.20(w) x 9.10(h) x 1.10(d)
Age Range:	18 Years

About the Author

Philip Kotler is the S.C. Johnson Son Distinguished Professor of International Marketing at the Kellogg School of Management at Northwestern University. Widely acknowledged as the world's foremost expert on strategic marketing, Professor Kotler is also a classically trained economist. He earned his Master's in Economics at the University of Chicago under the famed Nobel laureate Milton Friedman, who represented free-market thinking. He went on to pursue his Ph.D. at MIT under Paul Samuelson and Robert Solow, two Nobel Prize-winning economists who represented Keynesian thinking. "Many economists are not aware that the field of marketing originated as an economics discipline," Kotler observes. In his latest book, CONFRONTING CAPITALISM: Real Solutions for a Troubled Economic System (AMACOM; April 2015), he draws on his outstanding background in economics, as well as his esteemed knowledge of marketing, to offer unique insights into the inner workings of capitalism. "Capitalism, management, and marketing must be joined in a comprehensive framework to understand marketplace developments and impacts," Kotler contends. "I hope this book achieves that goal." Throughout his career, Dr. Kotler has received numerous honors and awards. He claims 22 Honorary Degrees, including five from Schools of Economics: Athens School of Economics (1995), Cracow School of Economics (1998), Budapest School of Economic Science (2001), Academy of Economic Studies in Bucharest (2005), and Plekhanov Russian Academy of Economics in Moscow (2014). In a Financial Times survey of leading global executives, Philip Kotler ranked fourth among the most Influential Business Writers/Management Gurus, following Peter Drucker, Bill Gates, and Jack Welch. He was also ranked the sixth most influential business thinker, following Gary Hamel, Thomas L. Friedman, Bill Gates, Malcolm Gladwell, and Howard Gardner, by the Wall Street Journal. Voted the first Leader in Marketing Thought by the American Marketing Association and named The Founder of Modern Marketing Management in the Handbook of Management Thinking, he has been recognized with a Distinguished Marketing Educator Award from the American Marketing Association and a Distinguished Educator Award from The Academy of Marketing Science. On his 75th birthday, Professor Kotler was honored with a commemorative postage stamp from Indonesia. Philip Kotler has consulted for IBM, General Electric, ATT, Honeywell, Bank of America, Merck, and other organizations on marketing strategy, planning, and organization. He has advised governments on how to develop and position the skills and resources of their companies for global competition. He has published more than 150 articles in leading journals, including the Harvard Business Review, Sloan Management Review, Journal of Marketing, Management Science, and the Journal of Business Strategy. He has also authored over 50 books on all aspects of marketing, including Marketing Management, the most widely used marketing textbook in graduate business schools worldwide, now in its 15th edition. Professor Kotler did postdoctoral work in mathematics at Harvard University and in behavioral science at the University of Chicago.

Read an Excerpt

Introduction:Creating High-Performance Capitalism

There are scores of books on capitalism, most of them defending it, several criticizing it, and many just trying to explain it. Why would anyone want to write another book on capitalism? a have five reasons for doing so.

First, I want to understand it myself. My family, friends, and acquaintances around the world live in a market economy run on a system called capitalism. They tell me they want to understand capitalism better.

Second, I believe capitalism is better than any other system. But I also believe that it has fourteen major shortcomings. I wanted to examine these shortcomings and their ramifications.

Third, I want to examine and propose solutions to each of the fourteen shortcomings that would help make capitalism perform better and benefit more people.

Fourth, many readers want a shorter book on capitalism to get their thinking started. Thomas Piketty’s book, Capital in the Twenty-First Century (Belknap Press, 2014), has sold over 200,000 copies, but most book buyers did not read the 500 or so pages beyond the first couple of chapters. In this busy age, we need more concise accounts of social and economic systems that deeply affect our lives. Piketty focused only on income inequality, which is only one of fourteen shortcomings of capitalism that need to be examined.

Fifth, I believe that my background provides an opportunity to develop some special insights into the workings of capitalism. I am a classically trained economist who studied under three great and opposite-thinking Nobel Prize–winning economists, namely, Professor Milton Friedman of the University of Chicago, who represented free market thinking, and Professors Paul Samuelson and Robert Solow of MIT, who represented Keynesian thinking. My goal was to apply macro- and microeconomic theory to understand company decision making aimed at winning market share in highly competitive markets. I feel that economists have neglected the role and power of marketing to shape and influence markets. Marketing is one of the bedrock concepts in a capitalist society. As a behaviorally oriented market economist, I focus my attention on the functioning of the five major players in a market economy: business enterprises, nonprofit organizations, financiers, households, and government. Capitalism, management, and marketing must be joined into a comprehensive framework to understand marketplace developments and impacts. I hope this book achieves that goal.

Table of Contents

CONTENTS

Introduction: Creating High-Performance Capitalism 1

Chapter 1: The Persistence of Poverty 17

Chapter 2: Income Inequality on the Rise 29

Chapter 3: Workers under Siege 63

Chapter 4: Job Creation in the Face of Growing Automation 79

Chapter 5: Companies not Covering Their “Social Costs” 95

Chapter 6: Environment Exploitation 105

Chapter 7: Business Cycles and Economic Instability 115

Chapter 8: The Dangers of Narrow Self-Interest 135

Chapter 9: The Debt Burden and Financial Regulation 147

Chapter 10: How Politics Subverts Economics 167

Chapter 11: Capitalism’s Short-Term Orientation 181

Chapter 12: Questionable Marketing Outputs 189

Chapter 13: Setting the Right GDP Growth Rate 199

Chapter 14: Creating Happiness as Well as Goods 211

Epilogue 225

Notes 227

index

Editorial Reviews

If you want to understand what's really wrong with our present system of Capitalism running amok, you'll have to read Kotler's book.” —Huntington News

“[Kotler] does for the pitfalls of capitalism what Thomas L. Friedman did in explaining globalization in The World Is Flat. This deserves a wide readership.” —Library Journal

“…the author’s prescriptions for change which are likely to be wildly controversial.” —Leading Business Books

“Critics of capitalism are not in short supply.. But when the critic is Philip Kotler, capitalism needs to sit up and take notice." —Financial Times

“…written for anyone interested in a common sense understanding of today's economic malaise; how we got here, where we're going, and how we can turn this around…” —Another Opinion

“…excellent book because it sends this very clear message to workers, bankers, industrialists, CEOs, politicians and presidents.” —BlogCritics

“…[Kotler’s] writing on behalf of all business; large corporations as well as one-person firms, mom-and-pop shops, small businesses and everyone in between.” —Small Business Trends

“Brings a fresh perspective on what capitalism is and how different variations of it are in existence in the world today…tackles multiple issues with conciseness” –-Book Barrage

“Every so often a respected economist writes a book that’s not just highly readable but that contains analyses and viable solutions to vexing economic and societal problems.” —Changing Winds

"...this well-written, heartfelt argument deserves to be read because it will make you think..." —Strategy+Business

"… timely book that provides a great overview of the issues facing capitalism. For anyone looking to get up to speed with these issues…” —Stock Ideas

“…timely and excellent study of business forces. Rather than a rejection of capitalism, this book focuses on how to return capitalism to a more sustainable model.” —San Francisco Book Review

From the Publisher

★ 04/15/2015
Though known for his writings on marketing, Kotler (marketing, Northwestern Univ.) is a trained economist. His intent here is to examine the flaws in modern capitalism for a wide audience. He identifies 14 interrelated shortcomings, such as the persistence of poverty, its short-term orientation, and the exploitation of the environment. The author devotes a chapter to each, outlining criticisms and defenses, and offering possible solutions. For the problem of rising income inequality, he cites the criticisms of economist Thomas Piketty in his best-selling Capital in the Twenty-First Century as well as billionaire Warren Buffett's objections to having a lower tax rate than his secretary. Kotler then looks at ameliorating inequality by increasing the minimum wage, capping top executive pay, improving transfer payment programs, and closing tax loopholes that primarily benefit the wealthy. VERDICT Kotler's discussion of the issues is both clear and concise; he succeeds in distilling complex ideas and contrasting opinions into a balanced analysis that all readers can understand. He does for the pitfalls of capitalism what Thomas L. Friedman did in explaining globalization in The World Is Flat. This deserves a wide readership.—Lawrence Maxted, Gannon Univ. Lib., Erie, PA

Library Journal

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