Besides the many short term predictions about the economy, we have a few evolutionary ideas about the future of the capitalist system. Marx predicted the fall capitalism due to class struggle ending in the dictatorship of the proletariat. Events in Europe did not follow this path. Schumpeter predicted a turn to socialism after the Second World War mainly due to conspicuous consumption and monopolies. Again developments went differently with Hayek as the chief Theoretician of the market economy. When China in the 1980s dismantled the planned economy, capitalism became the global economic system.

Hayek’s negative evolution hypothesis for a planned economy from 1935 was vindicated empirically in the dissolution of the USSR around 1991. This long time span gave Hayek the opportunity to declare the welfare state an evolutionary misfit—an error by Hayek (1944).

Theoretically, Hayek had support for his favour for neoliberalism in the theory of welfare economics, proving that a market economy was capable of overall economic efficiency. What Hayek missed to talk about was the key assumptions of public goods and decent income distribution.

There will be market failure, if undersupply of public goods, like protection of the environment policies against global warming. Similarly, a highly inegalitarian distribution of income and wealth reduces market viability.

The era of neoliberalism—1980 to 2007—has seen the coming of lethal climate change and a sharp increase in economic inequalities. Calls for economic reforms of capitalism are raised by e.g. Stiglitz and Krugman. The need for state intervention has dramatically increased by the pandemic 2019-1920.

Interestingly, Piketty has launched a hypothesis about capitalism that is at odds with welfare economics theory: The market economy operates with a bias for the capitalists, often pocketing more of national income than labour. The remedy is taxation and public sector spending, not the elimination of capitalists.

Piketty’s r > g appears to confuse two things:

• Capital share of yearly national income;
• Total value of all private

Basic to a market economy is Say’s Law. Poverty can only be reduced by sustained growth of economic output, as in China.

Empire

Politically, the candidate for evolutionary framework is the regime. They have varied since the Sumerians. Is there an evolutionary pattern? Examining many of the empires in known history, Toynbee came up with an evolutionary model for rise and fall of despotic regimes. The process was driven by minority elites having some advantages later to be dissipated. Perhaps this generalization is too vague for making any definite conclusions about the longevity of for instance communist China.

Selfishness

Socio-biology has become popular among scientists. Either they argue as Dawkins that selfish genes account for animal behaviour. Or they claim like Wilson that:

Human nature = genetics and culture. To scholars in the humanities and the social sciences, both strands invite false reductionism. But perhaps humans are also driven by genetic selfishness through the evolution.

Egoism is no doubt a powerful motive in human behaviour. Hobbes and Spinoza were right. But egoism is restrained by rules and reasons. Intention enters human activity, which is left out by socio-biology. It is relatively autonomous of the genome. In a world of egoists, rules are not self-enforced

Thus we come to the enforcer, i.e., politics. Human action = intention, rules, and enforcer. This is more than the Wilson equation.

Enforcement of Rules

With almost universal selfishness, the structure of Enforcement decides in effect the polity. The enforcer is what economists call an agent running an agency for the principal, i.e., the population. However he/she wants remuneration. Given opportunism with guile, the enforcer may declare him/herself Caesar with hereditary claims, often backed by religious illusions. As in Russia today, the enforcer may enforce general rules of justice, but also clamp down on challengers to himself.

Only rule of law restrains the enforcer. However, only a minority of world countries respect the rule of law. Russia has never experienced this system of restrictions on power (WJP, 2020).

Kant (2006) predicted that humanitarianism would lead all countries to endorse rule of law domestically. Between nations he dreamt of a world federation based upon rules of peace. What naivety! Kant accepted constitutional monarchy, which regime proved highly detrimental for Germany1914.

Intention makes it possible for humans to abstain from egoistic impulses and develop reasonable strategies. For most situations game theory can identify the rational strategy. Thus, for instance all two person games have at least one Nash equilibrium. A Nash equilibrium can be Pareto optimal, but need not be so. One must not confuse Pareto optimal outcomes with altruism. Egoism becomes dangerous when combined with violence.

War

Human known history is very much warfare. Violent selfishness has characterized the interaction between societies in human history. If the selfish genes account for animal developments, increasing survival fitness, then human evolution is also tied to selection by means of confrontation and conflict. The development of war technology has impacted strongly on societies and state. Still today, arms race is gigantic in size. It is no accident that a future war between the super powers will result in the ultimate destruction of life on Earth.

In early times, the role of the enforcer was often decisive for war. Thus, a dynasty or empire engaged in aggression for a variety of reasons. Later states took over, driven by state reasons, i.e., collective selfishness—see the evolution analysis in Diamond, 2005.

The universal egoism hypothesis would also explain the often occurring temptation to resort to cruelty. The 20th century was the bloodiest ever, says N. Ferguson.

Conclusion

Since the advent of the industrial-urban society, human selfishness collides with ecological viability. Despite COVID, the Keeling Curve mounts: Egoism will prevail, as the super polluters—China, USA, India, Russia, Indonesia, Australia, South Africa, and Brazil renege.

References

Dawkins, R. (2020). The selfish gene. Audible.

Diamond, J. (2005). Guns, germs and steel. New York: Noŕton. Ferguson, N. (2006). The war of the world. London: Penguin.

Hayek, F. (Ed.). (1935). Collectìvìst economic planning. London: Routledge. Hayek, F. (1944). The road to serfdom. London: Routledge.

Hayek, F. (1988). The fatal conceit. Chicago: University of Chicago Press. Huntington, S. (1996). The clash of civilisations. New York: Simon and Schuster. Kant, I. (2006). Paix Perpetulle et Textes. Paris: Flammarion.

Krugman, P. (2020). Arguing with zombies. New York: Norton.

Marx, K., & Engels, F. (2018). The communist manifesto. London: Vintage. Piketty, T. (2017). Capital in the 21st century. Cambridge: Harvard U.P.

Millstein, Ŕ. L. (2017). Evolution, in Stanford Encyclopedia of Philosophy.

Schumpeter, A. (1942). Capitalism, socialism and democracy. New York: Harper.

Smith, M. (1982). Evolution and the theory of games. Cambridge: CUP.

Stiglitz, J. (2019). People, power and profits. New York: Norton.

Tocqueville, A. (2003). Democracy in America. London: Penguin. Toynbee, A. (1934-1962). A study of history. Oxford: OUP. Wilson, E. (2020). Consilience. Audible.

World Justice Project. (2020). Worldjusticeproject.org