Democracies around the world are confronting growing mistrust and alienation among citizens, often thought to be caused by rising economic inequality and stagnant wages. On March 23, 2021, the Center for Governance and Markets welcomed Daniel Bromley, Anderson-Bascom Professor at the University of Wisconsin–Madison, for a conversation about his recent book, Possessive Individualism: A Crisis of Capitalism (Oxford University Press, 2019), as part of the Coexistence in Pluralistic Society seminar. Possessive individualism, Bromley argues, is dually shaped by untethered individually driven consumption and managerial capitalism which produces men and women who do not believe they owe anything to their communities or societies. This leads to rising societal alienation and mistrust in institutions, which Bromley believes will grow exponentially if not adequately addressed. Central to this vision is a reimagining of the firm as a public trust in which we are as concerned about workers as we are with CEOs who, in the US, make nearly 300 times the pay of the average worker.
Mark Pennington, Professor of Political Economy at King’s College London, served as the featured discussant, offering a principled and thought-provoking reply to Bromley’s argument. Professor Pennington agreed that inequality and alienation are problematic and should be addressed. However, Pennington argues that these phenomena are not directly linked to possessive individualism and that they should be weighed against the significant positive impacts of capitalism. He points to the global reduction in poverty around the world and the overall increases in human well-being across diverse communities. Given this progress, Pennington asks if we should be concerned with slightly rising income inequality in the UK or the US if, on average, individuals are much better off today than at any other point in history?
Together, these contrasting perspectives offer much food for thought as to the origins of the current discontent with capitalism and what ought to be done about it, as well as insights into the future of democracy and capitalism.
Daniel Bromley is emeritus Professor of applied economics at the University of Wisconsin-Madison and for decades served as the editor of Land Economics. His research contributes to institutional economics, natural resource management, environmental economics, and democratic theory. He has written over 15 books, including Sufficient Reason: Volitional Pragmatism and the Meaning of Economic Institutions (Princeton University Press, 2009).
Mark Pennington is Professor of political economy and public policy at King’s College London, where he directs the Centre for the Study of Governance and Society at King’s College London and recently served as head of the Department of Political Economy. Along with numerous books and articles on classical liberalism, environmental policy and planning, and political economy, Pennington is the author of Robust Political Economy: Classical Liberalism and the Future of Public Policy (Edward Elgar Publishing, 2011) which provides a comprehensive defense of classical liberalism.