22 September 2015

Capitalism can sell almost anything to anyone – but is useless at selling itself


The Republicans are anxious as the Pope arrives in America today. They fear that his speech to Congress on Thursday will provide ammunition for their political opponents. After many years of seeing the Pope as a key ally – against communism in the Cold War and on abortion and homosexuality in the culture wars – they worry that the 266th Pope is, well, a bit of a Lefty.

They have good reason to be concerned. Pope Francis has attacked consumerism. He has accused capitalism of increasing inequality and of sowing the seeds for greater global conflict. He supported Barack Obama’s restoration of ties with Cuba (but didn’t meet dissidents while there this week). And, among other political sins, he has advanced Naomi Klein-ist views on fossil fuels that would condemn hundreds of millions of the poorest people of the world to darkness and coldness.

The always diplomatic Donald Trump has decided the best response to all of this is threats. Asked what he would say to the Pope if he got the opportunity, Trump replied: “I’d say ISIS wants to get you” and ISIS “wants to take over the Vatican.” Such a charmer. Other conservative commentators have been more thoughtful. George Will, for example, has written (brilliantly) about “Pope Francis’ fact-free flamboyance” and has demolished some of the Pope’s least accurate assertions about the free market.

There is no evidence that the Pope’s controversial views on capitalism are doing him any harm with the free enterprise-loving American public. A YouGov USA survey found that 51% think the Pope is moving the Catholic Church in the right direction and only 13% worry he is heading in the wrong direction. Perhaps – and Mr Trump should note this – a man who seeks to unite and heal rather than divide and demonise  is what Americans are really yearning for from their public leaders.

But back to the Pope and his views on capitalism. On almost every topic he is wrong about the free market. Rather than increasing inequality throughout the world we are living at a time of ever greater equality. Rather than hunger rising, an average of 120,000 people have been lifted out of absolute poverty each and every day for twenty-five years. Far from being an enemy of social justice the medical advances, energy supplies, food production techniques and trade relations that are associated with global commerce have all been for public benefit. The spread of free markets – even more than the spread of democracy – has increased peace between nations. The Pope is able to get away with his nonsense because citizens of nearly every advanced nation in the world are also just ignorant of this progress. Even worse: majorities think hunger and poverty are rising. Blinded by the real difficulties that many developed nations have faced since the 2007 crash (and because of the impact of longer-term technological change) people have started to think the worst of capitalism.

So here’s my question: how can a belief system that spends $600bn advertising its products be so awful at selling itself?

During this year the global advertising industry will spend an estimated $600 billion advertising the products of the free enterprise system to consumers. That’s about $90 per person in the key markets of the world. The $500 billion will include $189 billion in America, $73 billion in China, $40 billion in Japan, $28 billion in Germany and $25 billion in Britain.  The biggest single advertising sector is personal care with Procter & Gamble Co., Unilever and L’Oréal the biggest three individual corporate spenders. It is amazing that capitalists as individuals are so attuned to the need to sell their individual products but so neglectful of the need to sell the system as a whole. It seems they can sell almost anything to anyone – including products we don’t really need – but can’t sell capitalism as a system. Next time the great and the good gather at the World Economic Forum in Davos they should consider how they might organise themselves a little better. They could begin by throwing a million or two in Max Roser’s direction. His World In Data project documents the historic progress that characterises our times.

Capitalism doesn’t just have a marketing problem – it has more fundamental challenges too – but ignorance of its great achievements leaves it very vulnerable to ill-informed pontiffs – and to more dangerous enemies on the political left. Free marketeers need to get more organised. A lot more.

Tim Montgomerie is a columnist for the The Times, a Senior Fellow at Legatum Institute and co-founder of the new website The Good Right.