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I am not an economist and certainly not a philosopher.  I am an entrepreneur. Since 1981 I have founded or co-founded several companies in the computer industry. Between startups I have brought foreign companies to the US or American companies to foreign markets.  I am currently involved in several startups hoping to get one funded.  

One thing that all my activities had and have in common is that my primary motivation has been to bring to the market a product or service that benefits the customers or solves a problem. Certainly I always expect to be able to make a living, but getting rich has never been my main motivation.

Everything I have done has been possible within a capitalistic system.  I would have not been able to accomplish anything within a system that did not reward innovation and risk taking.  

Capitalism isn't working photo capitalism-is-not-workingOWS_zps2825a0c2.jpg

On the other hand, however much I support the idea of entrepreneurship within capitalism, I have come to believe that the dominant capitalism system we now live within is not the capitalist system that we need.  The current system seems nefarious.  Greedy and sociopathic Wall Street capitalism will destroy America and the world if it continues to gain power.  Occupy Wall Street got me thinking and I thank the movement for that.

So what alternatives do we have?

I propose that we need to reform our capitalistic system towards something that can be called; "Progressive Capitalism".

More below the orange croissant.

Capitalism and democracy can work together but democracy has to prevail. Our current trend towards oligarchy must stop.  Greedy Wall Street capitalism, empowered by Citizens United, will destroy democracy as we knew it.  Our ranking in The Economist Democracy Index will continue to decrease. Our political system is diseased.

Communism and fascism are the hellish extremes of socialism and capitalism.

As a pragmatist I believe that socialism and capitalism both offer benefits.  Some things work better under a democratic government administration and some work better under private enterprise.  Prisons and the military should not be in private hands and yet both seem to be going in this direction.  The computer industry can benefit from government actions but it should remain in private hands. The pace of innovation inherent cannot be managed under government administration.  The food supply chain works better under a capitalistic system controlled by a democratic government and not under uncontrolled capitalism.  If you have any doubts watch Food Inc. on Netflix as I did recently.  The best possible healthcare system, as demonstrated by those countries that have a single payer, is a combination of a government run insurance and and privately held provider system.  The entertainment industry should not be owned by the government.  Education, as healthcare, is a basic human right and the government must insure that all have access.  The construction industry should be in private hands, but the transportation system should be guided or implemented by the government.  We can discuss whether there should be private highways or airports but trains, car manufacturers and airlines seem to work better in private hands most of the time. It's clear now that the repeal of the government control of banking under Glass-Steagall brought the Ponzi scheme that caused the 2008 debacle.  So, many aspects of the private financial industry must be controlled by the government.  Let's call it a mixed economy. Again, as a pragmatist I believe that what works works and I am open minded.

The current dysfunctional capitalism got started with the Reagan administration that IMO brought to power those who support the ideology of Ayn Rand assisted by the advent of the Chicago School, Austrian economics and similar schools of thought. I confess that 20 years ago I became mesmerized by this ideology that I now find as dystopian and dangerous as Marxism.

So, what else is there other than the current capitalist system?

In my research around "progressive" capitalism I have come across some interesting new ideas and frameworks that can function together.

Social Capitalism

In early 2009, Australian Prime Minister Kevin Rudd called for a new economic approach that he termed "social capitalism" which includes "a system of open markets, unambiguously regulated by an activist state, and one in which the state intervenes to reduce the greater inequalities that competitive markets will inevitably generate."[3]
The scholarly roots of social capitalism seem to be in Kees van Kersbergen's landmark study of European economies, entitled Social Capitalism: A Study of Christian Democracy and the Welfare State.[4] Van Kersbergen identifies social capitalism as the "common kernel" of the European welfare state and situates social capitalism as a "middle way" between socialist collectivism and neo-liberal individualism.[5]
There is a movement behind Social Capitalism.

Triple bottom line

The concept of TBL demands that a company's responsibility lies with stakeholders rather than shareholders. In this case, "stakeholders" refers to anyone who is influenced, either directly or indirectly, by the actions of the firm. According to the stakeholder theory, the business entity should be used as a vehicle for coordinating stakeholder interests, instead of maximizing shareholder (owner) profit.
A partial manifestation of this "triple bottom line" can be found in eco-capitalism;
Eco-capitalism is the view that capital exists in nature as "natural capital" (ecosystems that have ecological yield) on which all wealth depends, and therefore, market-based government policy instruments (such as cap and trade systems) should be used to resolve environmental problems.
These last two schools of thought seem to reinforce my decision to form a "benefit corporation" for one of my current startups (one of the first 1000 in California);
Benefit Corporations are a new class of corporation that 1) creates a material positive impact on society and the environment; 2) expands fiduciary duty to require consideration of non-financial interests when making decisions; and 3) reports on its overall social and environmental performance using recognized third party standards.
Practice what you preach. So shareholders will not be able to sue the Board of Directors for not putting the profit motive at the top. This new startup will also require the formation of what may be the first ever "information cooperative". (More about this in a future diary and please correct me if I am wrong and another such cooperative already exists.)

A right wing friend of mine alerted me to "conscious capitalism";

Some may think this is some “new age” look at business. It is not. Here is an interesting fact from the book. Many will know of Adam Smith’s Wealth of Nations, but how many know of his earlier book? My guess would be not many of us. His earlier book was entitled The Theory of Moral Sentiments. “In his earlier book, he outlined an ethics based on our ability to empathize with others and to care about their opinions.” (page 16)

By combining Adam Smith’s two works we gain a complementary relationship between ethics and economics. Simply stated, it isn’t all about self-interest. Mutual interest provides a check-and-balance to our economic approach.

My right wing friend also alerted me to the latest development in crowdsourcing;

SEC votes to “unleash wisdom of crowds,” approves crowdfunding rule

Commissioners at the Securities and Exchange Commission voted unanimously Wednesday to go forward with a proposal that will let small businesses raise money on the internet from mom-and-pop investors without having to go through cumbersome SEC procedures to register securities.

In an open meeting webcast on Wednesday morning, the five Commissioners each described the proposal (embedded below) and then voted to approve it, which will launch a public comment period that will lead to the final rule going into effect.

Wall Street must be fretting this SEC decision.

A neighbor and friend who recently passed away taught me about Basic Income Guarantee;

In 1969, a Presidential Commission recommended, 22-0, that the United States adopt a guaranteed annual income, with no mandatory work requirements, for all citizens in need. The report was buried and forgotten, even though the National Council of Churches, by a vote of 107-1, agreed. So did the Kerner Commission, the California Democratic Council, the Republican Ripon Society, and the 1972 Democratic Party platform.

Fast forward 50 years and the concept of a guaranteed income -- or Basic Income Guarantee -- is not discussed much anymore. But it remains, as the late economist Milton Friedman always maintained, the most practical and sensible way to end poverty in America and provide economic security to all Americans.

IMO this idea should be tried in Detroit. BIG has support on the right and the left and there is a movement behind it too. (RIP Allan)

I don't have all the answers and the reason I wrote this diary is to get ideas and information from my fellow Kossacks. But based on all of the above I am convinced that we can implement a more progressive form of capitalism.  The name "progressive capitalism" came to mind. When I Googled it I found at least two others who used it before;

David Sainsbury in his book Progressive Capitalism published only on Kindle;

'David Sainsbury's thoughtful manifesto for a Progressive capitalism draws on his experience in both business and government to offer an alternative political economy to that of the dominant, and dominating, neo-liberalism of recent decades.' Joseph Stiglitz, Nobel Prize-winning economist 'Essential reading for anyone who wants to understand the new model of capitalism evolving from the global financial crisis. An inspiration for politicians and business leaders who need to reinvent the mixed economy for the twenty-first century.'
I guess I need to get a Kindle.

And in DailyKos itself, Player published a diary last year warning about the need for progressive capitalism.

The domains ProgressiveCapitalism .com .net .org are taken but not used.  I'm already trying to acquire one (worst case a similar one).  

I believe it may be useful to start a group in DailKos so here is the link;

The logo we can change.  Any suggestions?

Originally posted to Shockwave on Mon Dec 23, 2013 at 10:40 AM PST.

Also republished by Progressive Capitalism.


Do you support the idea of Progressive Capitalism?

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Comment Preferences

  •  there can be progressive capitalists, but a (1+ / 0-)
    Recommended by:

    progressive capitalism distinct from an actual mixed socialist economy (what you've referenced as "social capitalism")  is an oxymoron in the last instance like "compassionate conservatism", because as we've seen with the DLC / Third Way, at some moment it's still about exploitation and surplus value, as the 1990s deregulatory mania showed us, and much to our detriment in 2007-8

    Warning - some snark may be above‽ (-9.50; -7.03)‽ eState4Column5©2013 "I’m not the strapping young Muslim socialist that I used to be" - Barack Obama 04/27/2013

    by annieli on Mon Dec 23, 2013 at 10:51:58 AM PST

    •  The current capitalist system is... (4+ / 0-)

      ...about exploitation.  Progressive capitalism should be a win-win-win proposition.  The owners, workers and society must benefit.  No more short term profits exploiting workers and damaging the economy, increasing inequality and destroying the environment.

      But rules and mechanisms have to be put in place for it to work.  And people and elected officials must understand the difference.

      Daily Kos an oasis of truth. Truth that leads to action.

      by Shockwave on Mon Dec 23, 2013 at 11:14:21 AM PST

      [ Parent ]

      •  rebranding is fine except (4+ / 0-)
        Recommended by:
        Shockwave, mike101, Odysseus, bluehammer

        for every win-win-win (note that this is not geometric) there will be classes of folks who must lose perhaps beyond national borders and there must be in such an evolutionary system compensatory or even steady-state mechanisms to ensure social welfare. As John Roemer has shown exploitation is a essential feature of capitalism and inheres even under socialism

        Warning - some snark may be above‽ (-9.50; -7.03)‽ eState4Column5©2013 "I’m not the strapping young Muslim socialist that I used to be" - Barack Obama 04/27/2013

        by annieli on Mon Dec 23, 2013 at 11:21:42 AM PST

        [ Parent ]

        •  Agreed (3+ / 0-)
          Recommended by:
          annieli, mike101, Darth Stateworker

          The environmental and social footprints of a private enterprise have to be assessed and managed through rules and regulations brought by a democratic elected government where money is not the leading political force.

          Democrats like Elizabeth Warren get it and give me hope.

          Daily Kos an oasis of truth. Truth that leads to action.

          by Shockwave on Mon Dec 23, 2013 at 11:30:09 AM PST

          [ Parent ]

          •  an amusing flick: "Xmas Without China" (1+ / 0-)
            Recommended by:
            Watch a Chinese immigrant challenge a family to survive Dec 25th with no Chinese products.


            Warning - some snark may be above‽ (-9.50; -7.03)‽ eState4Column5©2013 "I’m not the strapping young Muslim socialist that I used to be" - Barack Obama 04/27/2013

            by annieli on Mon Dec 23, 2013 at 11:32:45 AM PST

            [ Parent ]

            •  China is conquering America ... (0+ / 0-)

              one cheap, lead contaminated toy at a time. The ironic part is that America, its government, its financial institutions, its businesses, and its citizens, are willing partners in bringing about their own defeat without a single shot being fired.
              China is a clever country. It is using American greed as a weapon of war.

              Caution: The reality in the mirror may be closer than it appears.

              by glb3 on Mon Dec 23, 2013 at 07:20:06 PM PST

              [ Parent ]

  •  That was a very worthy effort. Thanks. My take (2+ / 0-)
    Recommended by:
    Shockwave, bluehammer

    is that the Corporate State already fail and that we need to come up with a new ethos and a new paradigm for democracy.

  •  Sorry... (1+ / 0-)
    Recommended by:

    Capitalism can never be "progressive". It's on its way to destroying most of civilization by fossil fuels and the an endless conga line of other hideous reasons. It irks me to no end to see "Innovation Districts" popping up all around the Cambridge / Boston area that only serve a very elite members of society. Meanwhile the rest of us get priced out by Yuppie Hives; and ruin any sense of community. I'm afraid your just fooling yourself...

  •  It is not only your opinion (1+ / 0-)
    Recommended by:

    that Alan Greenspan was a leading acolyte of Ayn Rand, nor that Reagan brought in Arthur Laffer's Voodoo Economics, nor that Reagan appointed Clarence Thomas to the Equal Employment Opportunity Commission specifically to gut enforcement, nor that Lee Atwater extended the racist Southern Strategy to the North for Reagan, and so on down the line.

    But we have to recognize Clinton's part in deregulation, and in not only allowing but cheerleading for the bubble that produced the 2000 crash. And Obama's part in not prosecuting anyone responsible for the housing bubble and the 2008 crash.

    Which leads us to the topic of money in politics. Citizens United means that we cannot limit political spending by outside groups. Under the Brandeis notion that

    The remedy for bad speech is more speech, not enforced silence.
    the only remedy I can see is full public funding of elections at levels that politicians cannot effectively outspend. That means full protection for Democrats running for state office from the likes of Art Pope and various Tea Party organizations. It does not mean, as I see it, immunizing Hillary Clinton against Shelden Adelson. But we can discuss it.

    Now that means finishing off the filibuster and undoing the gerrymanders, and ultimately waiting for the opportunity to replace one of our Supreme Court Conservatives.

    At that point, we can take up the Congressional Progressive Caucus platform, including Elizabeth Warren's ideas.

    It is universally agreed outside the Asylu—the precincts of the Market Fundamentalists that pure Capitalism is an effective system of production but not of distribution, while pure Socialism can only distribute poverty, not wealth. Adam Smith started the theory of Progressive Capitalism by defining wealth in Wealth of Nations not as money, but as the capacity to produce what is needed and get it to those who need it. (Pay no attention to the lying liars who claim him as an Apostle of unfettered Laissez-Faire. He was scathing on the rich in all ages, and on big business.)

    It is not that much of a mystery what the US needs to do. We need to rein in Wall Street, punish malefactors, and realign its incentives. We need to rebuild and modernize our infrastructure, particularly in education, renewable energy, transportation, and communications. We need to take direct measures against poverty with increases in the minimum wage and the number of decent jobs available. We need to end the War on Drugs. We need a new Voting Rights Act. And so on.

    I am working on an Unbalanced Budget Amendment to the US Constitution to require spending increases and tax cuts for the poor and middle class during recessions and cuts to subsidies and other giveaways together with savings and tax increases on the rich during boom times, preferably to the point of bursting any bubbles before they get out of hand. This is to give the rich an incentive not to run up the "business cycle" on us, that is, not to start the next asset bubble. The trick is to define formulas that Congress cannot mess up. So, for example, taxes have to be high enough to save what must be spent in the next recession, during an interval equal to that between the last two recessions.

    Also, if we end poverty with a living minimum wage, union rights, and improved education, among other things, we get to phase out all of the aid programs for the no-longer poor. We keep disability and all of that, of course.

    All of which, again, requires completing the job of nuking the filibuster; dismantling the gerrymanders; and getting a sane majority on the Supreme Court.

    Ceterem censeo, gerrymandra delenda est

    by Mokurai on Mon Dec 23, 2013 at 01:33:20 PM PST

  •  FYI- Kindle reading app available. (0+ / 0-)

    One can be found here.

    -- We are just regular people informed on issues

    by mike101 on Mon Dec 23, 2013 at 01:43:10 PM PST

  •  You might find this interesting: (1+ / 0-)
    Recommended by:

    there was an article a couple of years ago talking about the relationship between entrepreneurship and self-identity, and the authors came to the conclusion that there are three general categories of entrepreneurs - "Darwinians", "Communitarians", and "Missionaries" - each with their own set of goals and functions.  It's interesting stuff, not the least because the latter two categories are relevant to what you're discussing here.

    You can read the whole thing here (pdf), although it's a bit technical in the early going.

    Saint, n. A dead sinner revised and edited. - Ambrose Bierce

    by pico on Mon Dec 23, 2013 at 04:10:37 PM PST

  •  I had to go with maybe, I think you've asked the (0+ / 0-)

    wrong question. Anyone with two brain cells to rub together can see, whether or not they will admit it, that without restraint capitalism quickly devolves into monopolies run by cartels.

    I think the more relevant question is what is the purpose of capitalism? Adam Smith was pretty clear, IMO, but five minutes after his theory hit the street everything about it was ignored except the parts that expanded and accelerated the exploitation of the producers.

    The system of capitalism can work very well within a socialistic government, provided that the primary purpose and motivation of that government is the advancement of its people with an open marketplace to facilitate access to goods and services. IOW business works best when it works to provide goods and/or service at a profit, as opposed to seeking profit by providing goods and services.

    We used to know of and understand this social contract.

    "Those who can make you believe absurdities can make you commit atrocities." - Voltaire

    by Greyhound on Mon Dec 23, 2013 at 04:24:06 PM PST

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