The New York Times offers an example of a Japanese island that has developed a communitarian form of capitalism. Residents share government jobs, watch free cable television, enjoy immaculate parks and public toilets, and limit displays of wealth to prevent jealousy from undermining community solidarity.
Under Hime’s system, village employees earn about a third less pay than public servants elsewhere in Japan, though they work the same hours. This has allowed the village to create more jobs: it now directly or indirectly employs a fifth of all working islanders. Most of the rest are engaged in fishing, also government-subsidized. In fact, village officials say, there are few fully private-sector jobs on the island.
This is an interesting case study, because it shows how a community can engineer capitalism to their own liking. Creating such communitarian economic institutions probably requires a certain amount of social closure, so being an island may help. (Just to be clear: Hime Island’s economy is certainly capitalist; individuals living there have considerable freedom to deploy their human and financial capital as they please, and the entrepreneurially-minded open restaurants or small hotels for tourists.) The whole world cannot be Hime Island any more than Hime Island can be Silicon Valley, but the example suggests that communities may have more control over their destinies than neoclassical economics would predict. My friend David Grewal explains why such freedom requires collective action in his book Network Power.
The financial crisis provides an opportunity to revisit the assumptions of capitalism and recognize many possible varieties of capitalism, many of which have yet to emerge.