Bill Gate’s Creative Capitalism

This blogger stumbled upon back issue of TIME Magazine last week at a pavement in marine drive (Ernakulam). The cover story was about Bill Gates and “new creative capitalism”, the deal was good for me since it cost 10 Rupees. This blogger has not much understanding on Capitalism except few books/articles here and there like any other common people anywhere in the world. It is an interesting article by Gates although he says “it isn’t some big new economic theory. And isn’t a knock on capitalism itself”. He is smart man (a genius of computers….he started playing with computers and doing complicated things at an age when most us were into marbels or climbing trees, well atleast me!!. Clearly he is a brilliant man. Arguably the most well known businessperson in the world). As Michael Kinsley writes in an essay in the same magazine “it is perfect moment for the biggest corporate titan of all time to turn his attention to problems that software can’t solve”.

Gates starts with the statement that “mainly corporations that have the skills to make technological innovation work for poor”. I really couldn’t understand that one I thought technological innovation works because it is technological innovation, innovation is about applicability. Even the example of Kenya wherein innovative uses of cell phone helped low income people to save money is more due to technology and less due to corporate. These kinds of innovations keep happening at the grassroot level, recall an excellent example wherein villagers in Punjab used washing machine to make lassi (the popular word in north India is jugaad). The difference now is that technology has become bit too specialized for day to day innovations by common people. The reason why it is important for big Corporate to tap these markets since small players are not in a position to break even, “business find opportunities that have been missed”. Business here obviously has to be big corporate, small players are not in a position to pick up that $10. That is creative capitalism alright (he quotes CK Prahalad’s ‘The fortune at the bottom of the Pyramid’. It is a brilliant stuff). And rightly so Mr Gates suggest that “government can help create such opportunities where they presently don’t”. Government as facilitator of economic growth is important for development of society.

Bill Gate’s perspective is from the point of view of Corporate he writes “they can benefit from public recognition and enhanced reputation” by associating with cause. He adds “that might be the tipping point that leads people to pick one product over another”. Now this is where we consumers have to be cautious. I buy the product because I have the need, and so I expect the product to fulfill those needs. If the bottom line of corporate is profit my bottom-line as a consumer is quality- value for money. I am absolutely not interested in anything more than that. These extraneous factors shouldn’t influence my decision making. These “enhanced reputation” has nothing to do with the product. This might work in America where they consume/stock more than what they need and so have probably some kind of guilty conscious. It works with people who are blatantly consumerist.

Bill Gates correctly says “governments in developing countries have a lot to do to foster capitalism themselves. They must pass laws and make regulations that let markets flourish, bringing the benefits of economic growth to more people”. Although his perspective is again from the Corporate point of few this blogger would like to see it from consumer perspective and so very strongly feels stringent steps should be taken towards consumer protection. There should be strict laws for protecting natural resources and environment sustainability. Following these laws is Corporate Social Responsibility, it is important that CSR is not voluntary or part of charity (It may work in developed countries). Further the products coming in the market should have all the contents, ingredients, specification mentioned properly. This blogger is not into brands but quality. Brand building is an image exercise which may have nothing to do with the product (what has Pepsi to do with youth!!). This blogger wants the government to provide quality stamps/marks, which is what I believe rather than brand building by money bags. In capitalism government is not only a facilitator to Corporate but safeguard to people. In societies with acute disparities the later fact is often forgotten.

Most importantly the Indian context of giving money for charity falls in the religious-cultural context. If not this then it is a personal-voluntary act not done for gain but for self contentment. Bringing it under the context of consumerism is a dangerous move however well intentioned. The foundation of this society is on prudent use of means and respecting the surrounding. If most people around the world were indulgent like Americans this earth would be dead by now. It wouldn’t be wrong to say that the world is carrying the burden of American dream.

This blogger though strongly supports the second part of Gate’s article wherein he extends concept of creative capitalism to government giving incentives for innovativeness in drugs and vaccines to reach the poorest. There are thousands of higher end hospitals in this country wherein millions die of lack of basic treatments and medicines being costly.

Bill Gates is a genuine man with good intentions but the problems is that societies are not same everywhere. It is hard-earned money for most people in here and gimmick doesn’t and shouldn’t work. As a consumer I am more concerned about value for money. Period. The business of business is business, they provide goods and services. They generate jobs and provide social security and mobility for millions that is a stupendous achievement of capitalism. The government will have to make laws and not abdicate its responsibility as is demanded by market fundamentalists.

Post script: So why is that Corporate are being bailed out by US government in the latest crisis?. What kind of Capitalism is that?!!!. Clearly debt money was offloaded to keep the balance sheet straight. Is this mismanagement responsibility of taxpayers?.