Joe Kennedy preaches ‘moral capitalism’ at Harvard Law
Joe Kennedy started his push for “moral capitalism” by urging local business leaders to help address the country’s worsening income inequality.
Now, the congressman is spelling out his ideas for how the federal government should tackle the problem.
The Massachusetts Democrat spoke to a packed room at Harvard Law School on Monday, making his plea for a government unafraid to set new rules for a fair and just economy. Strong regulations, he argues, shouldn’t be viewed as an obstacle to growth but as a necessary condition for a functioning capitalist system to survive. From his point of view, government has been complicit in the erosion of workers’ rights.
His list is wide-ranging, with several controversial and costly elements. Update antitrust laws to rein in corporate power. Prevent hourly workers from getting hung up by noncompetes. Install a fairer system of taxation, one that demands more from top earners. A higher minimum wage. Paid family leave. More child-care subsidies.
Massachusetts already has adopted a few of these reforms. But Kennedy wants them embraced on the federal level. He is naturally emboldened by the power shift in the House that has put Democrats in charge. (But he’ll still need to work across party lines, of course, to get major bills through the GOP-controlled Senate.)
The event at Harvard represented a natural sequel to his Nov. 26 speech to the New England Council, when he first introduced his vision for “moral capitalism” and made a case that maximizing shareholder value shouldn’t be the only way to judge business success.
American capitalism has done more good for more people than any other economic system, he told the Harvard crowd, but that system is badly broken.
Kennedy also promoted the emerging “Green New Deal” effort, a climate-change initiative championed by Senator Ed Markey and Representative Alexandria Ocasio-Cortez. To Kennedy, proenvironment and probusiness agendas don’t have to be in conflict. For example, he wants state and federal agencies to take a more proactive role in preparing potential workers in the South Coast area to join the coming offshore wind industry.
Kennedy has clearly touched a nerve. Organizers had to move the Harvard event to a much larger room, due to crushing demand from students and the public, and a big waiting list remained. Sharon Block, a former Obama administration official who now runs Harvard Law’s Labor and Worklife Program, points to one reason the message resonates: The vast majority of people in the United States still feel like they’re struggling just to keep up with their bills, even after a nearly decadelong economic recovery.
Some business leaders have already started on a parallel path, promoting various tenets of conscious capitalism. Former Panera chief Ron Shaich, for example, is warning everyone who would listen about the pitfalls of Wall Street’s short-term thinking, the rise of activist investors, and the societal consequences. (Shaich also launched Act III Holdings, an investment firm that places “evergreen capital” in the restaurant industry, to put his money where his mouth is, so to speak.)
By speaking in his true-blue home state, Kennedy is essentially preaching to the choir. To pull off the reforms he seeks, he’ll probably need to convince voters in more conservative places, and the politicians who represent them. But he knows income inequality hits all points of the political spectrum.
A soaring stock market shouldn’t be considered the best measure of economic success, he argues, particularly not when so many people feel like they’ve been left behind.