Winners Take All: The Elite Charade of Changing the World

by Anand Giridharadas

  For example, one’s of B Lab’s great victories had been the creation of a parallel corporate law, first enacted in Maryland and then adopted in other states, that allowed companies to embed a social mission into their work without fear of legal trouble such as shareholder complaints. It was important to give good companies this protection. Kassoy, though, still wondered about “the larger systemic question here about whether an opt-in system in the end can ever overcome the power of the incumbent interests.” Was it more important to make it easier for Etsy to do good, or rather to make it harder for ExxonMobil to do harm? Was it possible to do both?

  Kassoy felt drawn toward the systems work, even though he had devoted the last decade to the other approach. “I’m not sure everybody would say this, but I believe that there’s a huge role for government regulation of business,” he said. “We’re not going to change everybody. We’re not changing human greed. Businesses act badly.” There were, in particular, “extractive industries where just the existence of the industry” means harm and social costs being dumped on humanity. “We’re not getting rid of all of those things,” he said.

  The United States had millions of corporations and, after a decade of B Lab’s evangelizing, just hundreds of B Corps. Kassoy saw now, more clearly than he did at the company’s founding, that solving problems like inequality, greed, and pollution would require more than making good easier. He was not the only MarketWorlder coming around to the thought that their ways of operating might be inadequate to the actual work of changing the world, or even just one’s own country. These MarketWorlders, though, often lacked an understanding of how actual change did work, or they felt, sometimes dubiously, that pursuing the other kind of change called upon skills they lacked. If government was the place you went to change systems, what could they as individuals do? They could petition the government. They could join movements fighting to change law and policy. But Kassoy, like many in MarketWorld, was daunted by this approach. He had the feeling that many in MarketWorld do that their grounding in the norms of business made them ill-equipped for the realm of politics, where win-lose was normal and where fights often had to be picked instead of mutually agreeable deals being struck. Conflict can scare the business type. “I am not a very effective activist,” Kassoy said, “and I know a lot of people who are, of whom I’m very supportive, but I’ve never been very good at it. I can’t tell you if that’s lack of courage, lack of an understanding of how to—like, I think being a really good activist requires some amount of manipulation, and I’m not that good at that.” It was peculiar, this idea of activism as manipulation; it sounded more like an excuse for not working on systems than a reason.

  Sometimes Kassoy felt confident in his proposition that it was enough to show what a better capitalism looked like, and to leave the system-changing and harm-thwarting to others. System change, he said, was “not my highest and best use”—the corporate language unwittingly underscoring the point. It was not part of his skill set. In his mind, there was a way to justify his work-within-the-system approach by comparing it to the work of Dr. Martin Luther King Jr. “Martin needed Malcolm,” he said. “I don’t think that what we’re doing can change capitalism by itself. But I do believe that what this does is it creates a model.” On other days, Kassoy wasn’t so sure about this logic. He kept coming back to regulation. “I’m a big-government kind of a person,” he said. “I believe that there’s a very strong role for the state. And I don’t know how to make that happen.”

  Kassoy’s ambivalence is what Jacob Hacker, the Yale political scientist, seems to have in mind when he speaks of political liberals who are philosophically committed to government, to the public solution of public problems, but who have absorbed, like secondhand smoke, the right’s contempt for public action. While people on the right believe actively in the superiority of market solutions, liberals like Kassoy do so passively—passively in that they do not reject a public solution in theory, but pursue a private one in practice. “I have a constant debate with my father,” Kassoy said, “who thinks the single most evil human being in the history of the planet was Ronald Reagan, because he single-handedly convinced us as a society the government’s bad.” He added, “If you think about Bill Clinton’s success in the ’90s, his Third Way was all about basically adopting a lot of that language. And so no one’s really told us government is a good thing for a very long time.” Saying this seemed to make Kassoy reflect on whether he had unwittingly become the latest link in this chain of liberals consolidating the war on government by proffering private solutions to public problems. “Now I’m not going to get a good night’s sleep as I think about this,” he said.

  Whatever Kassoy’s private doubts, B Corps were championed all over MarketWorld. The Aspen Institute had named not only Kassoy but all three cofounders of B Lab as Henry Crown Fellows. The Ford Foundation had given B Lab a grant. The founders were regularly praised by recognized “thought leaders” and often heard themselves called the same; two of the three of them had given a TED talk. B Corps certified by Kassoy’s team were among the most admired companies at Summit at Sea. Their system for rating companies had been discussed at Davos. The Beeck Center for Social Impact & Innovation at Georgetown promoted B Lab’s fellowship to train people on using “business as a force for good.” A leading B Corp called Laureate Education had attracted George Soros and KKR as investors, and named Bill Clinton its “honorary chancellor”—a job that paid nearly $18 million over five years, according to the Washington Post. “You ought to look at these B Corporations,” Clinton has said, and he elevated B Lab by featuring them one year on the main stage of CGI.

  Kassoy wondered how much he and B Lab would have to change to pursue reform of the system itself—to get into that terrain of making bad harder. For starters, B Lab had a strict ethic of positivity. “We stand for something, not against anything” was one of its mantras. But real change can require being against things, and he knew that. Real change often demands sacrifice, and these days, Kassoy said, “Not that many people are really putting themselves at risk.” Real change may compel trade-offs and the necessity of choosing your priorities. “I don’t believe that everybody just trying to be more responsible leads to higher returns,” he said. “There are trade-offs,” he added, but “no one wants to tell that story.”

  He sometimes looked at the little MarketWorld initiatives all around him that pursued change and avoided real change at the same time, and he wondered if it wasn’t just a way of throwing scraps to keep the peace. When private equity firms quoted William Blake and spoke of changing the world, how genuine was it, and how much was it a bid, as Kassoy put it, “to make people feel like they’ve been heard and not have bloody revolution”?

  Kassoy still believed deeply in what he and B Lab were doing. But he asked himself questions like, “At what point is it the right moment to say, ‘Great, this is how all business must act’?” He said, “As big as what I think we’re doing is, that would be taking a fundamental shot into the heart of capitalism.” Some bright, burning force within Kassoy seemed to want to take that shot, to challenge the people he once worked with in finance, to change business for all so that everyone played by the same rules, to go after the worst first rather than make it easier for the already good to be good—to change the system, with the consent of its citizens, not just work around its decay. And yet that force could feel itself to be up against a hugely powerful and pervasive web of myths—MarketWorld. If the force throbbing within Kassoy, if change itself—genuine, from-the-root change—was to have a shot, many people would need to be freed of these myths and remember what change actually is.

  * * *

  —

  On the night when Kassoy sat wondering about his way of changing the world, his alma mater, Stanford, was hosting an event across the city that might have cost him even more sleep had he attended it. It was a panel discussion about a collection of essays titled Philanthropy
in Democratic Societies, featuring two of its editors and two others representing the giving world. The host for the event was David Siegel, a philanthropist who had reportedly made $500 million in a single year, and who had opened the offices of his hedge fund, Two Sigma, to host the event, despite the book’s rather critical take on philanthropists.

  The people who came, some to hear big philanthropy get its comeuppance, first gathered in the hedge fund’s airy kitchen, nibbling on miniature tacos the girth of a finger and sipping wine. Then the program began, and before long Chiara Cordelli, an Italian political philosopher at the University of Chicago who had coedited the collection and contributed an essay, found herself sitting two panel seats over from a philanthropist who embodied everything she challenged in her scholarly writings. He was Sanford Weill, a former chairman and chief executive of Citigroup and now an active donor whose name adorned a wide array of causes. Weill was the anti-Kassoy: a product of the system who had few doubts about it, who believed as fiercely as a person could believe in the importance of elite private saviors like him.

  Weill hadn’t been big on government doing things when he was building Citigroup and wanted to be free of regulation, and now he wasn’t big on government doing things when it came to solving public problems. He thought, then and now, that problems were best left to people like Sanford Weill. That evening, Weill repeatedly said rich people like him had to step in and solve public problems because government was too broke, too incapable, wasn’t up to the task. He said this even though he personally was one of the reasons the government from time to time lacked for resources. Weill had, after all, been named by Time one of “25 People to Blame for the Financial Crisis,” because of his relentless push for a vision of banks as “all things to all customers,” and his “persistent lobbying,” ultimately successful, for the repeal of Glass-Steagall, a law dating back to the Great Depression that restricted investors’ risk-taking. He had advocated for too-big-to-fail banks, and he had gotten his way, which had helped to bring about the largest financial crisis in decades, which had caused the government to spend tens of billions of dollars bailing Citi out. And now Sanford Weill bemoaned that the government had no money, and thus he had to chip in and help out. By the third or fourth time Weill said this, Cordelli had grown irritated enough to shoot back a reply: “The government is us.”

  Weill was unmoved by this and seemed immovable. Yet Cordelli’s vision of what is really going on when elites try to change the world may be the bracing tonic that Kassoy—and other MarketWorlders harboring doubts—need to see their situations more clearly and perhaps alter their ways. More important, it may give the rest of us a sense of permission to seek a better world with or without their help.

  The morning after the panel, Cordelli sat in a quiet, high-ceilinged room in the SoHo Grand Hotel, on a high-backed sofa in front of an unmanned DJ booth. She nursed coffee in a paper cup and, speaking in careful, methodical sentences, sought to unravel some of MarketWorld’s self-justifications.

  Take, for instance, the view that MarketWorld has a duty, and right, to address public problems—and, indeed, to take a lead in developing private solutions to them. This, for Cordelli, was like putting the accused in charge of the court system. The question that elites refuse to ask, she said, is: “Why are there in the world so many people that you need to help in the first place? You should ask yourself: Have your actions contributed at all to that? Have you caused, through your actions, any harm? And, if yes, the fact that now you are helping some people, however effectively, doesn’t seem to be enough to compensate.”

  Cordelli was speaking of both the active committers of harm and the passive permitters of it. The committers are what she calls “the easy cases.” She said, “If you have campaigned against inheritance tax, if you have directly tried to avoid paying taxes, if you supported and directly, voluntarily benefited from a system where there were low labor regulations and increased precarity,” then, she argues, “you have directly contributed to a structure that foreseeably and avoidably harmed people.” That is “direct complicity.”

  As for the people who don’t help run Goldman Sachs or Purdue Pharma, who live decent lives and attempt to make the world slightly better through the market, Cordelli called them the harder cases. An economist might say the marginal contribution to the world made by someone like Kassoy was positive. Cordelli rejected this analysis. She saw in each of these types of efforts not a single moral act but two. Alongside the act of helping was a parallel act of acceptance.

  These MarketWorlders, with their myriad private initiatives, were doing more than merely adding good to the world. They had benefited in the past, and often continued to benefit, from a system—a set of institutions and laws and norms—that dependably blocked many people from living full lives, and that had in the United States in recent decades increased rather than shrunk the ranks of those who had been shut out. These elites were, she said, like the owner of a painting who later finds out it had been stolen. Even if the theft was before the purchase, Cordelli said, “still, it seems that, if you know the person the painting has been stolen from, you have an obligation to return it to them. Maybe even to apologize, acknowledging that you have an object that is not your own, acknowledging that you have something that has been the fruit of that injustice.”

  As in Kassoy’s case, the choice to solve a problem in one way is a choice not to solve it in another way. Had Kassoy pursued his thought of making it harder for companies to do bad things, involving himself with politics and the law and the system itself, success might have meant the loss of opportunity for the Kassoys of the future, and could even have come at a cost to his own earnings from his old life. That was no easy decision to make.

  But that is a choice, Cordelli tells us. To do a modest bit of good while doing nothing about the larger system is to keep the painting. You are chewing on the fruit of an injustice. You may be working on a prison education program, but you are choosing not to prioritize the pursuit of wage and labor laws that would make people’s lives more stable and perhaps keep some of them out of jail. You may be sponsoring a loan forgiveness initiative for law school students, but you are choosing not to prioritize seeking a tax code that would take more from you and cut their debts. Your management consulting firm may be writing reports about unlocking trillions of dollars’ worth of women’s potential, but it is choosing not to advise its clients to stop lobbying against the social programs that have been shown in other societies to help women achieve the equality fantasized about in consultants’ reports.

  Economistic reasoning dominates our age, and we may be tempted to focus on the first half of each of the above sentences—a marginal contribution you can see and touch—and to ignore the second half, involving a vaguer thing called complicity. But Cordelli was challenging elites to view what they allow to be done in their name, what they refuse to resist, as being as much of a moral action as the initiatives they actively promote.

  Her argument is not that every bad thing that happens in the world is your fault if you fail to stop it. Her claim, rather, is that citizens of a democracy are collectively responsible for what their society foreseeably and persistently allows; that they have a special duty toward those it systematically fails; and that this burden falls most heavily on those most amply rewarded by the same, ultimately arbitrary set of arrangements. “If you are an elite who has campaigned for or supported the right policies, or let’s suppose that you are not causally complicit in any direct sense,” she said, “still, it seems to me that you might owe a responsibility or duty to return to others what they have been unfairly deprived of by your common institutions.”

  The winners bear responsibility for the state of those institutions, and for the effects they have on others’ lives, for two reasons, Cordelli said: “because you’re worth nothing without society, and also because we would all be dominated by others without political institutions that protect our right
s.”

  To take each of those in turn: She says you are worth nothing without society because there can be no hedge fund managers, nor violinists, nor technology entrepreneurs, in the absence of a civilizational infrastructure that we take for granted. “Your life, your talents, what you do could not be possible if they weren’t for common institutions,” Cordelli says. If the streets weren’t safe or the stock markets weren’t regulated, it would be harder to make use of one’s talents. If banks weren’t forced to offer a guarantee of guarding your money, making money would be pointless. Even if your children attended private school, public schools very likely trained some of their teachers, and publicly financed roads connected that island of a school to the grid of the society. Then there is the fact that absent a political system of shared institutions, anyone could dominate anyone. Every person with anything precious to protect would be at constant risk of plunder by everybody else. To live in a society without laws and shared institutions that applied equally to all would be, Cordelli says, to live “dependent on the arbitrary will of another. It would be like a form of servitude.”

  Think of the person who seeks to “change the world” by doing what can be done within a bad system, but who is relatively silent about that system. Think of the person who runs an impact investing fund aimed at helping the poor, but is unwilling to make the connection, in his own head or out loud, between poverty and the business practices of the financiers on his advisory board. Think of a hundred variations of this example. Such a person, for Cordelli, is putting himself in the difficult moral position of the kindhearted slave master.