The Denny Center for Democratic Capitalism at Georgetown Law exists to reconcile the benefits of free market capitalism with the values and expectations of a democratic society.
Over the last 200 years, global gross domestic product (“GDP”) has grown from $1.2 trillion to $108.1 trillion; and in the United States, GDP per capita increased from approximately $2,000 to $53,000 — a 26-fold increase. Over the same timeframe, global life expectancy increased from 29 to 72 years, and the percentage of children who survive beyond the age of five increased from near 50% to over 95%.
Finally, the percentage of the world’s population living in extreme poverty stood at 84% in 1820 while just 10% are estimated to live in extreme poverty today. The facts leave little doubt that the forces that free market capitalism unleashed, which were also supported by increasingly democratic societies and the institutions therein, have raised the global standard of living and improved the health and living conditions of the average global citizen by leaps and bounds.
However, big problems remain unsolved, and capitalism as a system is under increasing scrutiny. Since 1965, the ratio of CEO pay to that of the average worker has grown from 20:1 to 312:1 — should the forces that sustain free market capitalism be expected to offer a more equitable offering of wealth creation opportunities?
Corporations have produced unparalleled innovations and enormous efficiency gains, but for the most part, have left governments to worry about the stewardship of natural resources — should businesses be responsible for addressing the common good while also generating sufficient returns for shareholders?
Critics also point to a short-term profit focus and corporate scandals as evidence that free market capitalism sacrifices morals for profits — do businesses, and the markets in which they operate, really lack a moral code?
The Denny Center is committed to identifying and tracking the vital statistics that measure the balance of capitalism’s benefits with society’s values and expectations, and to calling out the tensions and disconnects even when answers are not easy or obvious. One of the center’s core convictions is that businesses create more long-term value for owners when they serve all stakeholders well.
Tensions and trade-offs are ever-present, but boards and executives all too often use an “either/or” approach to decisions when using a “both/and” mindset (i.e., to do well and to do good) is available.
To this end, the Denny Center’s work falls into three main areas:
- Conducting and publishing research including the center’s signature annual report card to analyze the current health of democratic capitalism;
- Convening leading voices from business, government and society (both public and private sectors) to discuss existing tensions and recommend new paths forward;
- Creating student experiences to enrich their education, engage them in the center’s work, and prepare them for lifelong contributions.
Georgetown Law provides the ideal home for the Denny Center given its esteemed faculty, strategic location, vast resource base, and outstanding student body.
The center draws from faculty expertise across the Law Center and the broader Georgetown University family, leverages the resources offered by the Law Center’s research capabilities, compares notes with external DC-based institutions, seeks student input and leadership on select initiatives, and hosts leaders and influencers that regularly visit Washington D.C.