I have been reading Sapiens by Yuval Noah Harari lately.
It is a very interesting take on the History of Humankind from as early as we have records until the book was written in 2015.
I can't say that I agree with every aspect of Harari's Beliefs, and his Bias is very apparent in the way he writes, but that Bias does Provide some Fascinating Perspectives on History.
Overall, it has been an enjoyable read that is making me consider many aspects of History in new ways.
At the moment, I am in the middle of the section on Capitalism and what allowed it to rise to Prominence around the Globe.
As I've been reading through it, I have been thinking about the Challenges we are seeing in the world today and I noticed something.
There are some Lessons that allowed Capitalism to Rise which seem to be Lost on today's Capitalists.
If Capitalists Today do not "Re-Learn" these Lessons, I Fear it will have Catastrophic Consequences.
What are those Lessons?
Well, the first comes to us from Adam Smith's "Wealth of Nations".
This book is considered one of the most Important books on Economics of all time.
Harari specifically says that one of Smith's Arguments states, "...that an increase in the profits of private entrepreneurs is the basis for the increase in collective wealth and prosperity."
In some ways, we have seen this play out in the US for many years.
There is a Reason that the US became known as "The Land of Opportunity."
If this works out accordingly, then it makes sense to work with Entrepreneurs to make their Visions of the Future into Reality.
It becomes a Virtuous Cycle where the Entrepreneur's Vision Becomes Reality, Collectively Wealth and Prosperity Increase for those Involved with the Vision, and Once the Vision is Complete we as a Society Move to the Next Vision.
In Theory, Everyone Wins.
But what happens when, In Reality, Fewer and Fewer People Prosper?
What happens when In Reality, the Entrepreneur's Vision becomes Complete, but Wealth and Prosperity Decrease?
What happens when those Involved in the Vision begin to Lose Wealth and Prosperity?
What happens when Entrepreneurs, and we could include C-Suite Executives in today's world, make Promises that Wealth and Prosperity will Spread, but "They" are the "Only" Ones who See It at the End of the Day?
Those who "Lose" begin to Lose Trust in the Entrepreneurs and the C-Suite Executives.
Now Losing Trust creates "Plenty" of Problems for Businesses that have been seen as of late.
Quiet Quitting, Mass Walkouts, Strikes, Insubordination, Lack of Innovation, Decreasing Productivity, and more.
However, it Creates a Significantly Larger Problem when it comes to Capitalism Specifically.
Harari makes this point very clear in his explanation of how the Dutch rose to power over Spain.
See, one of the Trademarks of Dutch Success in their Expansion across the Globe was that they were Insistent on paying their Loans on Time.
On the other hand, The Spanish King was not so Insistent.
What did this do?
For the Dutch, they began to Prosper, and those who Invested with the Dutch also Prospered.
This created Trust in the Dutch.
So Much Trust that Investors continued to Invest More and More into Dutch Projects as they could Trust that their Investments would create More Prosperity.
The Spanish King on the other hand continued to Dwindle their Reserves Quickly, requiring More and More Funds, without any Returns to Investors.
Fewer and Fewer People Trusted the Spanish King, and without Trust, Investors No Longer Invested in the King.
As the Dutch Created more Prosperity, the Spanish King lost Everything.
When people Lose Trust in Entrepreneurs and C-Suite Executives, they go in the same way - They Lose Everything.
However, there is something far worse than this, which is what I fear.
What Happens When People Lose Trust in the Entire System of Capitalism?
As Harari points out, Capitalism works "Only" because there Is Trust for a Better, More Prosperous Future.
"Much trust in the future" leads to "Much credit" which leads to "Fast growth" which leads back to "Much trust in the future".
Without Trust in the Future, there is No Credit.
Without Credit, there is No Growth.
Without Growth, in a System that "Requires" Growth to Pay Back Loans, it Creates a Bubble.
When the Bubble expands too much, It Bursts.
Without Trust, this is the Future for Today's Capitalists.
At Today's Size, a complete lack of Trust in the Future, which we are Hearing More and More Frequently from More Generations, will become a Catastrophic Burst.
People talk about the possibility of an AI Bubble Burst, and the Horrors that would Create.
But what happens if there is a Catastrophic Complete System Bubble Burst?
Now, the Lessons herein point Modern Capitalists to something they Must Understand, something that I learned from Native American Teachings and which I repeat because it is True.
All Flourishing is Mutual.
In the System of Capitalism, this is Especially True.
If You "Succeed", but that Prosperity is not Shared with your Employees, your Suppliers, your Customers, or the World at Large, you will lose Trust.
Without Trust, You Will Fail to Flourish.
It is only a Matter of Time before that Lack of Trust creates Failure.
With Multiple, Simultaneously Failures, it could create a System Collapse.
To avoid a Catastrophic Result, we must Redesign our Businesses so that True Flourishing Occurs.