What is the Great Reset? According to the World Economic Forum, its chief sponsor, “There is an urgent need for global stakeholders to cooperate in simultaneously managing the direct consequences of the COVID-19 crisis. To improve the state of the world, the World Economic Forum is starting The Great Reset initiative.”
Klaus Schwab, the founder and executive chairman of the World Economic Forum, penned an article for the special edition of TIME that will focus exclusively on the Great Reset, titled “A Better Economy Is Possible. But We Need to Reimagine Capitalism to Do It.” This is the crux of the Great Reset.
Schwab argues that capitalism, as currently practiced, must be reimagined. Interestingly, the notion of “reimagining” is a buzz word on the Left. Many have called for the reimagining of policing (among several other social institutions), including Barack Obama.
But, Schwab is calling for the reimagining of capitalism, the very system that has lifted billions from abject poverty. According to Schwab, “[T]here are reasons to believe that a better economic system is possible—and that it could be just around the corner.”
According to Schwab, a Great Reset is necessary because, “For the past 30 to 50 years, the neoliberalist ideology has increasingly prevailed in large parts of the world. This approach centers on the notion that the market knows best, that the ‘business of business is business,’ and that government should refrain from setting clear rules for the functioning of markets. Those dogmatic beliefs have proved wrong. But fortunately, we are not destined to follow them.”
Schwab’s solution is the Great Reset, which would include the introduction of stakeholder capitalism.
As he writes in TIME, “In September, my belief that a more virtuous capitalist system is possible was reaffirmed by an initiative of the forum’s International Business Council led by Brian Moynihan of Bank of America. They released the Stakeholder Capitalism Metrics.”
Some of these metrics would include, “What is the gender pay gap in company X? How many people of diverse backgrounds were hired and promoted? What progress has the company made toward reducing its greenhouse-gas emissions? How much did the company pay in taxes globally and per jurisdiction? And what did the company do to hire and train employees?”
Schwab claims momentum for stakeholder capitalism has been building since 2016, the year Donald Trump was elected president. Coincidence? Unlikely. Trump is an avowed supporter of America first, and is fairly cynical when it comes to globalism.
As Schwab says, “The initial idea that companies should try and optimize for more than just short-term profits came around 2016 from a handful of business leaders who wanted the private sector to play a role in achieving the U.N. Sustainable Development Goals … In the following years, pressure from social- and climate-justice movements such as Fridays for Future (inspired by Greta Thunberg), #MeToo and Black Lives Matter added to the sense of urgency.”
Like many who are calling for radical transformation, Schwab is piggy-backing off of the discontent that has rattled the world in recent years, but has been magnified since the pandemic began.
Schwab concludes his article by reiterating the need for stakeholder capitalism. “Of course, we remain far from our goal of achieving a better global economic system for all. The Stakeholder Capitalism Metrics are just one of many initiatives that are needed to get to such an outcome—and time is quickly running out. … It is up to us to replicate and follow such an approach. When that happens, those who follow the path of stakeholder capitalism will soon find that it leads to a more inclusive and sustainable economy for all.”
Schwab, the WEF, and several multinational corporations, are all-in on stakeholder capitalism. The next big question is will America, where capitalism has reigned supreme for more than two centuries, be on-board too? We might find out very soon, possibly soon after November 3.
Chris Talgo ([email protected]) is an editor at The Heartland Institute.