CEO of Whole Foods Defends Capitalism, Talks Socialism

back to the subject of capitalism, capitalism and Marxism and socialism. Right now we're in a wave of this, right? It's become more popular now, I would say over the last, particularly during the Trump administrations, the concept of socialism at least has become more publicly discussed than any time that I can remember in my life. Why do you think that is? I think it's because the generation that's coming up is, I mean, you have to understand the academic community is, I always say the intellectuals have always been the enemy of business, certainly the enemy of capitalism. But why is that? I think because in a market society, which has been rare in history, we haven't mostly had market societies, but they're not very important in a market society. The intellectuals aren't very important? Generally not as important, no. Aren't they the ones that inspire the minds of the people that create and maybe innovate in the industry? They don't have the same social status that the entrepreneurs have. Elon Musk or Steve Jobs or Jeff Bezos. So you think it's an ego issue, the social status issue? Think about it this way. You're going to school, okay? People that end up teaching in the universities were always the smartest kids in the school generally, and they do well in school. I mean, smart in terms of doing well in school. And they go on to college and then they go and get a PhD and then they, that's all they've known is school. That's been their universe, right? And they excelled at it. And they were smarter than the other kids in school. And now these other kids, they go to college and they get a degree in business and they're in a fraternity and they make a lot of friends in relationships and they make more money than the intellectuals do. That seems like that's completely unfair. It's an unjust world that the less smart people are making more money than the smart people do and they have more status in the society. And I think that's under, underlying it is a resentment or an envy of a society that doesn't judge them to be as important as they judge themselves. That's interesting, but I think it's a very flawed perspective. And first of all, the term smart is a weird term. I said smart in terms of school. I didn't say in terms of street smarts or ability to do things, to connect with people. There's emotional intelligence. I'm merely saying they're good at taking tests, writing papers, abstracting thoughts, essentially. Yeah, but this is what I'm saying. Just the term smart, it's almost like, the problem is it's like a blanket term, right? It's like drugs. It applies to a bunch of different things that don't necessarily seem to be related. But the people that are interested in that, pursue that. The fact that they can't understand that there's an intell... Elon Musk is a great example. If you don't think Elon Musk is intelligent, you're either deni... You're not very intelligent yourself. You don't think Elon Musk is intelligent. You're delusional or you're a liar or you're in denial. It's one of those things. Something wrong with the way you think. He's clearly intelligent, but there's people that call him a fool. The guy's running four different businesses simultaneously. They're all successful and he's innovating when it comes to space travel in a way that you would assume that someone have to dedicate most of their life just singularly to that task to be able to figure out past NASA how to shoot a rocket up into space and have it land and then reuse it. No one's been able to do that besides him or up until he did it. I think Jeff Bezos' company is doing the same thing. Yeah, the Blue Origin. Yeah. They're obviously two of the great entrepreneurs of this particular era. But I don't think Jeff Bezos is actually engineering these things. But if you think about it, the intellectuals have always disliked business. They've always discriminated against the merchant classes, the Jews in the West, Chinese in the East. There's really been no historical period where intellectuals praised business. Maybe a little bit around the time of Adam Smith up until probably Ricardo and Malthus wrote in the early 19th century. For the most part, business people have been seeing they're disruptive. They change things. They upset the status quo. They innovate. Well, a lot of people don't like innovations. It's threatening. It changes social status. It changes wealth relationships. It's almost like capitalism is like a genie that got out of the bottle. And they're trying very hard to stuff the genie back in the bottle as much as they can. I think if you think about it that way, you'll understand we're never going to win the intellectuals over. I speak in universities all the time. And the students, I'm an entrepreneur. I self-identify that way. Students love when I talk about conscious capitalism. I say, you can do good and you can do well. There's no contradiction here. You're the good guys here. You're not the bad guys. Do you debate people about this? I do. I've debated a number of socialists. And what is their primary argument? Their primary argument is that business is greedy and selfish. It's about motivations, that business people have the wrong motivations. In a lot of ways, conscious capitalism is an answer to that. It's a complete answer to that because in the book and in Conscious Leadership as well, we're basically arguing that business isn't primarily about maximizing profits. Business is primarily about creating value for other people. And through creating value for other people, you do make a profit. But it's the value creation that comes first. The profits come second in exchange. And it's almost if you are creating value, then you are profitable. And then you can reinvest those profits and you have this upwards spiral. So business has this potential for higher purpose. It's not primarily about greed. Greed is found in human nature, Joe. It's not just found in business people. There are plenty of greedy governmental officials, plenty of greedy politicians, greedy lawyers. Greed is endemic to the human nature. Business people either have no more or no less than it. It's just part of who we are. Has anyone ever laid it out in a way that's very compelling? Like when you have these debates with socialists and someone, has anyone ever laid it out in a way where they have a point where you see their point? The best way to do a debate is to completely understand the other side's position. Understand it as good or better than they understand it. And so I've read widely in socialistic literature. I think I do understand it. It's a type of utopianism. It's an attempt to change human nature. If we would all love each other and if we'd all share equally, then the world would be a better place. And hey, guess what? It probably would be if we were naturally that way, but we're not naturally that way. We look first generally for ourselves and our own families and then our growing circle of relationships that we develop. We want, it's not natural to, it's natural to want your own children to have advantages. That's just human nature to want your children to flourish because you raise them, you love them. And somehow or another to say that's unfair is cutting against human nature. People are always going to look for advantages or privileges, so to speak, for their children. People don't like when people have advantages and have victories because then someone has to lose. When someone loses, they equate that someone losing with a bad feeling, with that person being victimized. So here's a big idea we talk about in Conscious Leadership. We have a chapter called Find Win-Win-Win Solutions. The metaphors that we use to think about society tend to be very binary, good versus evil, light versus darkness, win versus lose. And so they tend to think of business as a win-lose game. Somebody wins and somebody else is losing. But the beauty of capitalism is it's a win-win-win game. It's an infinite game. It's a game because the customers are winning or they wouldn't trade. The employees are winning. How are the customers winning? They're getting products and services and there's competition to make those services and products better. The employees are winning because they have jobs and opportunities to grow, benefits are paid and they do that voluntarily. They're not forced to work for any particular company. They do it because they think it's in their best interest. Win for the employees. The suppliers who are trading with the business, they're winning as well or they wouldn't make the exchanges. Investors are winning or they wouldn't make the investments. And the larger society is winning because business is the engine that creates all the money that goes into nonprofits and governments. Without business, there is no government and there is no nonprofit sector because those are ultimately supplied through what business creates. So business is a win-win-win game. All of these stakeholders are winning and that's why capitalism lifts society up. Socialism is an attempt to reverse that back to a win-lose game and that's why it always fails. And that's why capitalism wins. How is it an attempt to bring it back to a win-lose game and what were? The ones that are winning, so to speak, the business people are clamped down so they're not allowed to win. It's like we're going to take your success and we're going to redistribute it. So that, as again, you said earlier on, incentives matter. But we're going to take away the incentives for business to really flourish and succeed. They should do it from altruistic reasons. And we may do some things for altruistic reasons but you cannot build a society around it. When you're talking about win-win-win, this is a very, in many ways, it's, I see what you're saying, but there are things that are negative that are associated with profit and innovation and particularly expanding industry, right? Particularly environmental impacts. Like when you say win-win-win, there's very rarely, especially when you're dealing with creating and designing and building things, you've got a negative impact in some way, fundamentally. Two points. First of all, historically, socialism has been far worse polluter than capitalist countries. How so? Well, if you just look at the environmental destruction that the Soviet Union left behind it, it was a complete disaster. Right, but this is socialism done wrong, John. We're going to do it right here. Who has done it right, Joe? No one's done it right. No one. But the Soviet Union is a bad example because Stalin was... Yeah, but all of Eastern Europe. There's no incentive to protect the common good in socialism, and they don't. When the government has a monopoly of all decision and power making, they don't tend to look out for the environment. That's one of the myths. You also take away agency from people, and you take away their desire to improve and do better. And without incentive, people just don't perform the same way. But the beautiful thing about business, let's concede a partial truth to what you said, there will be unintended negative consequences, as you say, environmentally. Well, that's why you have to regulate business to a certain extent. That's why you have to make people responsible for their environmental pollutants. Because business innovates and has an incentive to innovate, business can innovate and create solutions to those environmental problems. Okay, let me stop you there for a second. When you say make people responsible for their environmental pollutants, then we're going to have to deal with another aspect of capitalism. And that's the effect the special interest groups and lobbyists have on politicians. Because they create laws that shield these big businesses from consequences from these negative actions. So by saying that they have to clean up their problem, the only way that's ever going to happen is if they're not protected. If they don't use that influence and money, totally agree. So this is where I think a lot of people have a valid argument against capitalism. Capitalism has kind of fucked over our system of government, in a way, because money has gotten so deeply involved with super PACs and lobbyists. And there's so much money involved that it changes the way we govern things. Is that a flaw of capitalism or is that a flaw of government? I think it's a flaw of government, but that government has been influenced by capitalism, by capitalism's desire for universal growth, for constant growth. The sad truth is that humanity is not perfectable. We can never create the perfect system. And the attempt to create the perfect system, the perfect thing to me, the good. Capitalism is not perfect. It is not because human choices and what people want varies. Capitalism will sell cigarettes to people because that's what people want. It gives them pleasure, but it's bad for their health. But they're giving people what they want. It's the same thing in any type of externality. That's not deliberately done to harm the society. It's sort of a byproduct. Right, but this is why win-win-win doesn't really work. It's not really win-win-win. It's win-win most of the time, but with some negative consequences that are better than the alternative. Right? But what you strive for is to take those externalities or those negative consequences and try to, through good government, to minimize them or lessen them. I'll give you an example. So you used to live in LA. Well, when I went to LA back in the early 80s, it was like going to New Delhi today. I couldn't see. My lungs hurt less than 24 hours. Right. But with the regulations, the error in LA is a fraction as polluted as it was 40 years ago. We have been able to clean it up. That is an example of how you can take the worst impacts of industrialization and ameliorate them or lessen them. Episodes of the Joe Rogan Experience are now free on Spotify. That's right. They're free from September 1st to December 1st. They're going to be available everywhere. But after December 1st, they will only be available on Spotify, but they will be free. That includes the video. The video will also be there. It will also be free. That's all we're asking. Just go download Spotify. Much love. Bye bye. Mwah! 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