The financial industry has created havoc in the world’s financial system. By encouraging people to buy things they could not afford, leveraging their own companies beyond all reason, and creating financial instruments they sold to others and then bet against, brokers and bankers have created a worldwide financial catastrophe.
They have forced the world’s governments to spend the largest sums in history to bail them out to stop a complete collapse of the economy. It has crushed the average person’s savings and, because of plummeting property values, has left millions of people with debt they cannot repay. This has eliminated the purchase of goods, services and payment of taxes forcing businesses and governments to lay off millions of people.
This is however only the immediate tragedy. By squandering the world’s money as they enriched themselves, they have forced us to divert our attention from the world’s most urgent and costly problems. As we struggle to put people back to work and pay off massive debt the financial industry is forcing us to pay the largest “opportunity cost” in history.
An opportunity cost is simply the cost or value of the best alternative choice that is not chosen or is foregone. In our case the larger opportunity cost we will be paying arises from our inability to focus our attention and resources to aggressively combat climate change and the ozone holes. Due to an unanswered climate change, a new North Pole ozone hole, and at least a decade of U.S. government inaction, the financial industry’s avarice will cause human suffering and dislocation beyond anything we have seen in history.
But why has this happened? Is it the result of bad people or is it because of avarice and greed in the business world? Obviously the overwhelming majority of people in business are just everyday working people trying to do the best they can for everyone. Unfortunately there is a small group of bad actors who typify a flaw in how we do business. In their view it is expected that the strong and knowledgeable take advantage of the weak and uninformed. They have taken the phrase “survival of the fittest” and used it in a misunderstood application of science.
British economist, Herbert Spencer, first used the phrase “survival of the fittest” to characterize Darwin’s process of natural selection. Unfortunately when some business people try to interpret and apply the thought in their daily lives it leads them to misconstrue the lesson of evolutionary progress. The phrase calls to mind imagery of one animal besting another. The concept gets generalized to rationalize setting aside normal personal moral standards when viewing business as dog-eat-dog. Their conclusion is that anything goes in business which becomes the basis for their primitive behavior of the past. As “primatives” they cloak themselves in misunderstood science and act as if there is a jungle around them. They have obviously missed the point.
Evolution provides a forward looking definition of “the fittest”. The image of the most aggressive animal in the jungle is backward looking. Evolution defines the fittest human being as the one who can demonstrate success and survival most importantly in the future. The fittest today are those who exhibit an ability to work with and lead others. They achieve the greatest level of consciousness and prescience by establishing future directions and taking actions that produce the greatest good for the greatest number. This is the standard to which we should hold all leaders of businesses.
Until we do, the greed of business must be counterbalanced by the peoples’ government that insures a set of rules and regulations which protect all of us but most importantly the weak and uninformed. They must not be allowed to fall prey to unethical and unprincipled business practices because at the end of the day they have the least ability to afford the loss.
Finally, we do not have a choice about making the necessary and sweeping changes required by climate change and replenishing the planet’s ozone. Because money is not readily available this will be a painful investment. Nevertheless we must make progress and the sooner the better. The longer we wait, the more expensive solutions will be and the longer the cures will take. While we know the solutions will not be as good as we hope, we can hope they will not be as bad as we fear.
Background: In Beyond Animal, Ego and Time, in Chapter 16 – Transcending Egocentricity, pages 186-187, there is discussion of the phrase “survival of the fittest” and its misinterpretation in business. This is followed by a list of people who served as contemporary examples of the “fittest” of their time.