Author: CRT Admin

A trendy movement in institutional investing is ESG investing to promote better outcomes in the environment, society and governance.

In the U.S., market opportunities have provided investors with profitable financial plays in the ownership of family homes to rent them out. Squeezing families into rentals over owning their own homes has deleterious effects on “society” and constitutional “governance.”

You can find a consideration of these dynamics of a “brute” capitalism here.

What is social justice? Is it a moral capitalism? What ethics should constrain the power of rulers? What is the fitting status for individuals in society – pawn or king? In chess, pawns are often sacrificed to protect higher status players.

In the U.S. today, we have opened a very acrimonious debate over the meaning of social justice, asking what is right and proper. The issues are complicated; the way forward not obvious; the various narratives internally confused. The particular setting for our contentions is a heritage of slavery, civil war to end slavery, prejudice on the part of a majority against one particular discrete and insular minority, a civil rights movement and success in life outcomes for some with that minority status, but setbacks and disadvantages experienced by others with that same status.

“What is to be done?” we ask, borrowing a challenge to the status quo asked by famous proponents of social change in Russia.

A new term has been put front and center in our debate – “equity.” But what does “equity” mean? Fairness? But that is only the surface of the conundrum. How much of what will make for fair outcomes? Fairness to whom? Who will benefit? Who should pay for those benefits? Does fairness in life require personal diligence and commitment to excellence?

As former President Jimmy Carter said: “Well, as you know, there are many things in life that are not fair, that wealthy people can afford and poor people can’t. But I don’t believe that the federal government should take action to try make these opportunities exactly equal, particularly when there is a moral factor involved.”

The Caux Round Table Principles for Government look to individuals as the unit by which to measure the actuality of justice.

But that is not how many American advocates now use the term “equity.”

Getting social justice right is a challenge for all cultures and societies. Invidious distinctions and different lived experiences among groups and individuals are as old as the tribal origins of our species. How should wealth, power and privilege be distributed? By fiat, through competition or with a little help from our friends?

I have reflected from the perspective of individualism, drawing on Aristotle, Chinese ethics and the practice of equity over the centuries in the courts of England in the comment which you can read here.

Your comments regarding “equity” would be most appreciated.

Our colleague, Herman Wijffels in The Netherlands, just sent me some of his thoughts on how high entropy correlates with many of the distempers and institutional dysfunctions we see around us.

If the analysis has explanatory power, which I suggest it does, then our task is to reduce entropy in culture, society, economics and politics.

Herman is a retired Dutch politician of the Christian Democratic Appeal party and businessman. He served as Chairman of Rabobank, Chairman of the Social and Economic Council and as Dutch Representative/Executive Director at the World Bank Group.

Here is Herman’s email to me:

Dear Steve,

Thank you for sharing this thoughtful paper on entropy with me. I enjoyed very much reading it and agree with your findings. To be honest, my interest in entropy was not so much focused on the personal level, but especially looking at it at different levels of the collective. So, your considerations are a real addition to my understanding of the phenomena.

Let me share some of my thoughts at different levels:

-Energy is one of the most important gifts of Creation/God/Source/Big Bang. Energy is the main input for evolution, for translating potential into reality. By using energy, some of it gets lost, so in the logic of evolution, it has to be used as productively as possible, in a dynamic equilibrium between stability and chaos. As a reference, I would think here of the cosmic path, the harmony of the spheres of the Doa and also of the golden ratio. At this point in time, at the planetary level, we are in a situation of disequilibrium, between mankind and the planet and between people, ecologically and socially. A lot of energy is not used productively, creating chaos, entropy.

-This global situation is reflected at the level of the nation state. Democracies suffer increasingly from polarisation. Parties develop a truth of their own, turn inside and are less inclined to an open dialogue, thus creating entropy and chaos at that level. Energy is wasted in a power struggle, instead of used to further the common good.

-Looking at our economic system, capitalism, the ongoing focus on financial goals, on wealth accumulation, is depleting and destroying natural capital and undermining social capital. Too much focus of energy on internal goals of businesses and too little on external, societal goals is misusing it. Stock buybacks are a case in point.

-Many organizations, as well in the public as in the private sector, are suffering these days from an overload of bureaucracy. Too much energy is needed internally to keep things going at the expense of external orientation and effectiveness.

-All of this is typical for the choices that have been made in the industrial age, ultimately leading to a culture in which egocentrism is a central feature at every level, also at the level of the individual. Unbalanced use of energy and entropy are a logical consequence of this culture at every level, from the planetary all the way down to the personal level.

-Looking at it from this perspective, we are in need of a transition to a new culture, a next civilization, in which common interest and maintaining the ecological and institutional commons do play a more central role. More energy will have to go into sustaining the condition in which life on this planet can flourish.

Here’s the May edition of Pegasus.

In this issue, we include a presentation by our fellow, John Dalla Costa, on the teachings of Pope Francis, which connect those teachings to a multicultural, humanistic framework not limited to confessional adherents of the Roman Catholic magisterium.

I would be most interested in your thoughts and feedback.