CHAPTER 10

The Way to a World of Peace and Plenty  

A program whose basic thesis is, not that the system of free enterprise for profit has failed in this generation, but that it has not yet been tried.                                                                                                                            Franklin D. Roosevelt, 1932[1] 

The way to a world of peace and plenty is democratic capitalism, the free enterprise system that can eliminate material scarcity, elevate spirits, unify people, and stop the violence.  Seventy years after President Roosevelt’s lament, the way was still blocked by concentrated wealth and by violence in the relations among people and nations.

Late in the twentieth century, the demise of Communism and the demonstrable superiority of economic freedom gave the world an unprecedented opportunity to move along the way towards a world of economic common purpose. This opportunity was lost, however, because the U.S. government was promoting ultra-capitalism instead of the economic system that maximizes and distributes wealth broadly.

From the beginning of the American republic, finance capitalists successfully lobbied special privileges and impeded economic and social progress through the concentration of wealth. During the last quarter of the twentieth century, however, this nexus of Wall Street and Washington combined government mistakes, financial deregulation, and suspension of market disciplines to escalate this traditional impediment into a dominant force. Ultra-capitalism—defined as a combination of mercantilism that treats workers as a cost commodity, together with finance capitalism that is dominant over, rather than subordinate to, the commercial process—has slowed the world’s economy and provoked social tensions that range from populist protest to terrible violence.

Reformers with the democratic power to remove the impediments to economic and social progress have lost the way for over two centuries because they failed to understand fiscal, monetary, and regulatory policies well enough to counter the sophistication and lobby power of finance capitalists. At the end of the twentieth century, the size, speed, and complexity of the world’s capital markets allowed ultra-capitalists to increase their domination and further confuse the reformers.

American citizens must come to understand the benefits of democratic capitalism in contrast to the corruptions of ultra-capitalism, and then refine capitalism and restructure government accordingly.  With a democratic capitalist agenda, America will again be positioned to lead the world in the direction that improves all lives. The democratic capitalist way to a world of peace and plenty has been defined in this book and is summarized in this chapter.  

My Experience  

My experience at running companies (see chapter 2) gave me confidence that I understood the circumstances required to release the enormous latent power of people to produce and innovate.  For many years, my job was to identify the full potential of companies, provide the circumstances conducive to realizing that potential, and neutralize the impediments.  From experience, I learned that full potential is reached through individual development in a harmonious whole because total performance is the sum of individual performance enhanced by the cooperative environment.  The governance template required to make this theory work includes the following four elements: integrity, a prerequisite to cooperation and trust; maximum freedom that motivates each individual to be involved and to contribute; minimum structure that provides the disciplines for freedom to function well; and competence accurately to relate task to resources and to execute effectively.

According to my understanding of these basics, I put this formula into practice.  I had learned early from team sports that each is responsible for individual conditioning and skill development but also for contributing to that rewarding sense of team spirit. Later I recognized that this principle is consistent with the human duality of individual ambition and the instinct for social cooperation in which each lends his or her strengths to compensate for the weaknesses of others, and each borrows strengths wherein he or she may be weak.  In this lending and borrowing process, I observed that each person both learns and teaches, and thus the whole becomes greater than the sum of its parts.  Why, I wondered, was this way of individual development in a harmonious whole not also applicable to families, to education, to companies, to governments, and to the world as the universal way for each and all to reach their full potential?

This paradigm of democratic, progressive human behavior provided me with the ideal; my job was then to find the means to reach the ideal.  I did not realize at the time that I was engaged in an interactive process of truth-seeking that would confirm the ideal by identifying, examining, and testing the means.

From experience, I learned that when individual ambition is properly coupled with social cooperation, the improvement of group performance is not slight but huge. Motivation and a positive attitude are the first priorities because people must want to be involved, to contribute, and to be trained.  Motivated people with a positive attitude and a sense of common purpose make implementation easier, whereas people with a negative attitude make execution difficult.

If motivation and a positive attitude are the first priorities to individual development in a harmonious whole, where do they come from, how are they put in place?  Further examination showed me that individual motivation and a positive attitude depend on individuals with a sense of freedom, dignity, self-respect, common purpose, and a fair share of the rewards.  How can these circumstances be provided?  Excellent education and training require a financial commitment and doing the job well; the sense of freedom, dignity, self-respect, fairness, and common purpose, however, are more complicated because they depend on the quality of  leadership and the culture of the organization.  Democratic capitalism offers the decentralized structure, but the requisite culture still depends on the right selection and training of leaders at all levels.

The final component to be integrated with high-quality leadership in the democratic capitalist culture is the sharing of financial rewards that have been generated by the improved performance.  This opportunity for individuals to make their contributions and reap their rewards was the mission of the profit-sharing and ownership plan that I designed and put into place while CEO of ADT, Inc. The contest to name the plan was won by a lady who said that her understanding of the proposed plan was that “the more people care, the more they will have to share”; hence, Care and Share. The lady was correct:  Whenever capitalism is properly democratized, individuals participate freely and think of themselves as owners, thus improving individual and group performance.  In this environment, peer pressure and leadership replace top-down, command-and-control management; the fun and satisfaction that arise from involvement and cooperation displace fear and mistrust.

Among hundreds of branches, I found a shortcut to identify those ADT locations held back by the wrong culture and weak management.  Because Care and Share was voluntary and required a financial sacrifice to participate, a low level of subscription in a particular branch was an early and accurate indicator of trouble.  In effect, non-participation was a vote of no confidence in local management by the associates in that branch, which demonstrates that business, like politics, is local.

Ever since Karl Marx (1818-1883), “worker ownership” has had a threatening sound. Those with wealth thought it meant: “We have it, and the masses are trying to take it away.” The worker ownership that I propose throughout this book is different from the Marxist revolutionary approach that spawned the fears of the wealthy. In democratic capitalism, no one takes anything away from anyone else; rather, the workers buy ownership with their own money, and they share in additional ownership accruing from the improved performance that they have helped to build.  How can workers with tight budgets buy ownership?  It is surprising how fast workers can build ownership from a modest weekly deduction from their pay, especially when the company adds more stock based on improved performance. From the beginning, workers feel and act like owners as long as the structure is decentralized and the culture is one of trust and cooperation.  During ten years of Care and Share, the associates at ADT purchased and earned ownership of 13% of the company through their payroll deductions and the profit-sharing plan. Their ownership percentage would have continued to climb, had ADT remained an independent company.

My experience included an education in the corruptions of capitalism, for I was running ADT during the time when ultra-capitalism was growing to dominate the economy. I observed that Wall Street during the 1970s was making a profound change from providing long-term advisory services to transactional, basing the price of their services on a percentage of the deals they negotiated. Inevitably the number of deals exploded and rained money on all involved. This change on Wall Street initiated the compensation feeding frenzy that eventually infected the whole system.

During this time, the rush of hundreds of billions of dollars from ERISA pension funding (see chapter 7) gave the stock market new power to reward or punish CEOs, based on small changes in the quarterly earnings of their companies. Many CEOs learned how to parlay stock options into fortunes, many others were reluctantly forced to abandon long-range plans (see chapter 8).  I was dismayed that the corporate mission to serve the broad constituency of stakeholders was ridiculed by many, including the financial press and Business Schools. The new mantra had become “shareholder value,” a focus that ignored the growing excesses that, in time, destroyed shareholder value. The “American Model” that was flaunted to the world as the new, improved economic paradigm included the philosophy that “greed is good.” This emergent ultra-capitalism was a contradiction of democratic capitalism, the management philosophy that I had learned and practiced from the time I was a young plant manager until I retired as a 62-year-old CEO.

In retrospect, I judge my management performance in terms of financial measurements to have been successful.  ADT had a total market value of $97 million at the beginning of my term; by the end of my term, shareholders had received about $1 billion in dividends and cash for their stock.  I judge the company’s overall performance, however, to have been well below its potential. The reason for this, besides my own limitations, is that changing any corporate culture is a long process. Most of the managers were educated in an environment that gave tacit approval of the command-and-control style and no attention to democratic capitalism as a coherent system.  Leaders have to be retrained away from the top-down management style, and away from the mercantilist philosophy that profits go up as wages and benefits go down, instead of profits going up as people are motivated to contribute.  I found that managers are quick to agree philosophically with democratic capitalism, but, under stress, some will revert to the traditional style.  Changing the organizational culture is a delicate process because months of slow progress can be wiped out quickly by the actions of a single supervisor who demeans people.

Many who have never had the experience of changing an environment to release the latent power of people, might think that the steps necessary are too obvious for comment, and the benefits exaggerated. More cynical observers would describe them as warm and fuzzy concepts with no place in the macho world of Social Darwinism, creative destruction, and downsizing.  Only from experience, it seems, can one appreciate the magnitude of the human power that is released under the right circumstances.  Rather than being anachronisms, these concepts have new currency in the Information Age because the release of the cognitive power upon which Information Age industries depend requires a democratic capitalist culture.

On retirement, I had a compelling curiosity to find out whether this system confirmed by my own experience and that of many others might well be the way to a world of peace and plenty.  I wanted to find out whether wise people throughout history had arrived at a similar conclusion, but if they had, why the world was still full of misery and violence.  

My Studies  

            I began my studies by reading through the 11 volumes of the Story of Civilization by Will and Ariel Durant. [2]  I found their prodigious work invaluable because it provided a context of people, places, and times useful in truth-searching.  The rest of my research was a matter of reading from my personal library and listening to educational cassettes and CDs.  I regularly read over a dozen professional periodicals and a half-dozen newspapers from the far left of the political spectrum to the far right.  Reading opinions from the far right and far left is an education in itself. Truth is not necessarily to be found by adding them together and dividing by two, but that is a good start.

Why is the world so full of misery and violence when an economic system is available that can eliminate both?  If humans seek to be free of want, fear, and oppression, why do they not adopt the system that has demonstrated its capacity to satisfy these needs? Why do humans not use their unique rational abilities to understand this opportunity for freedoms, and then use their democratic power to put it in place?  These hard questions led to the philosophers’ query of whether history has a direction.

Pondering these questions led me to this overview of history: Ever since humans moved from being hunter-gatherers to being farmers and city-builders, we have demonstrated that trust and cooperation improve performance and generate the good feelings that foster social cohesion. Division of labor in a cooperative, trusting way, and present effort for future benefits, became civilized habits.  Humans also found, however, that beyond the circle of rational social behavior, the violent have ever been ready to take away what human reason had produced.

Within the circle of trust and cooperation, people have knowledge of their neighbors and their circumstances; beyond the circle, relationships are dominated by a lack of knowledge that produces fear, suspicion, and frequently violence.  Outside the circle of common purpose, people grab at and hold all they can get, and they build up political structures and armies to protect the wealth they have amassed and to gain more.  From ancient empires, to the rise of the warrior state in the 16^th century, to the world of weapons of mass destruction in which we live today, violence on a more massive scale, with more technologically sophisticated fire power, has continued to limit the growth of the circle of trust and cooperation among people trying to be free of want, fear, and oppression.

In the outside circle, the predatory bands were comfortable with the use of force, intimidation, and violence.  They would regularly demonstrate quicker success, whether military or commercial, merely by taking what they wanted rather than by producing it.  For this reason, defectors from the circle of trust and cooperation would occasionally join the predators in pursuit of short-term results. This defection continues because the distinction between visible short-term gain and longer-term expectation of gain requires a high-quality reasoning process as well as patience and discipline.

At the beginning of the 21^st century, the revolutionary technology of the Information Age has moved us one giant step farther.  Now, either the circle of economic common purpose can expand to encompass the whole world or the predators can use our new powers to commit unprecedented folly and violence.  At this same time, various types of political societies—mature economies, emerging economies, democratic governments, and authoritarian regimes—have all demonstrated their ability to take advantage of the superior capacity of economic freedom to improve lives.  Reason might well expect, then, that the circle of trust and cooperation would become worldwide, and that the competing circles of folly and violence would recede.  It has not worked that way as yet, however; so my studies led me to dig deeper into history.  

Society Advances; Predators Attack  

Hammurabi (2123-2081 B.C.) was at first a successful warrior who brought order out of the incessant local warfare in lower Mesopotamia . He then drew up 285 laws and inscribed them in a public place for observance by all. When order had replaced violence, and society was based on justice under law, Hammurabi then addressed the general welfare by investing in the human and physical infrastructure.  He dug canals, stored grain against famines, lent money at no interest to stimulate commerce, and prevented exploitation of the weak by the strong. Broad wealth distribution and better education improved the standard of living and stimulated momentum in all branches of knowledge, including astronomy, medicine, mathematics, physics, and philosophy.

This advanced society, in what is now mainly Iraq , lasted only a short time. Eight years after Hammurabi’s death, Babylon was invaded and pillaged by the Kassites, a tribe of mountaineers from the northeast border. These predators, probably European immigrants, conquered and ruled in ethnic and political chaos for centuries.  Society had advanced quickly, but it was brought back to barbarism even more quickly.[3] 

About four thousand years later, the world’s largest Muslim nation, Indonesia , was attacked and left in economic and social chaos by foreign invaders. This time the weapons were hot money and currency speculation, the invaders were ideologues of the “liberalization of capital markets,” but the destructive effect was the same.

In another part of the world fifteen hundred years after Hammurabi’s civilization was destroyed, Confucius (552-479 B.C.), a Chinese humanist, manager, thinker, and teacher, spent his life analyzing the same question I was addressing: Why do so many live a life of misery and violence?  I found Confucius’s philosophy for the better organization of secular life to be consistent with the template of democratic capitalism. He included individual development in a harmonious whole, broad educational opportunities, moral discipline in the individual and within the family, civic order in the state, equal opportunity, meritocracy in the selection of leaders, broad wealth distribution, and an end to violence.

More than a century after Confucius, Aristotle (384-322 B.C.), the Greek philosopher of common sense, applied a scientific truth-seeking process to social organization. “Logic” was his term for this systemic method of seeking truth, and he used it to understand the nature of things, which he called “physics,” and to understand the principles of social association, which he called “ethics.” Aristotle likened the pursuit of individual virtue to learning how to play the flute because in both cases it takes practice, practice, practice.

The primary human elements that Aristotle emphasized are courage, temperance, justice, and wisdom. In each case, Aristotle urged the use of wisdom, close to the contemporary expression “street smarts,” as the key to moderating the extremes and finding the workable “Golden Mean.” Aristotle saw that all living things have certain common traits: nutrition, reproduction, and locomotion plus a distinguishing feature of each living being that he called its “essence.”  Aristotle believed that a living thing functions naturally because it arises from its essence—or, as the pop song goes, “Fish gotta swim, birds gotta fly.” The Aristotelian extension of that species essence is that “humans gotta reason.”  The record of human performance demonstrates that we humans need more practice in using our essential reason.

The Crusades opened the door to the Christian discovery of the Muslim culture, so that a larger collection of Aristotle’s writings became available in Europe .  Thomas Aquinas (1225-1274) undertook the daunting task of assimilating knowledge from Jewish, Greek, Muslim, and Christian philosophers whose literary works included science, medicine, humanities, philosophy, and religion. These were men of amazing intellectual range and practical accomplishment such as the Muslims, Avicenna (980-1037) and Averroës (1126-1198); and the Jewish philosopher, Maimonides (1135-1204).  Avicenna (Abu ali al-Hussein ibn Sina), for example, wrote over 100 books, including medical texts that were used in Europe for the next 500 years.

For thousands of years, leaders and philosophers like Hammurabi, Confucius, Aristotle, Avicenna, Averroës, and Maimonides showed the way, but their social progress was reversed by predators who stole riches, and lands, and enslaved people.  Despite these setbacks, from the human urge toward freedom came new philosophers who rediscovered the way and new leaders who rebuilt the circle of reason, trust, and cooperation. By the end of the 18^th century, the acceleration of rational and technological progress was freeing the Western mind and facilitating improved industrial technology and more economic freedom, and this in turn was freeing more people from concern only with primitive needs. Was it possible that better educated, healthier people would use growing democratic power to widen the circle of reason and control the predators?  

The 18^th-Century Enlightenment: Freeing the Mind  

The Enlightenment thinkers of Europe , the British Isles , and America were optimists who believed that history must have a rational direction, a direction that ought to move towards the human achievement of our full potential.  The Enlightenment corollary to this rational hypothesis was that the means to attain the ideal could be found through a high-quality truth-seeking process. 

Freedom to think, write, and act was a new and fragile thing:  Galileo (1564-1642) had ended his days under house arrest; Descartes (1596-1626) was too fearful to allow publication of his best work until after his death; Bruno (1548-1600) paid the ultimate price for his insistence that the Copernican rearrangement of sun and earth was fact and not hypothesis. Even a century later, Montesquieu (1689-1755) Charles-Louis de Secondat, Baron de Montesquieu wrote cautiously of the French power structure only by putting his words of criticism in the mouths of Persian visitors.  Francois Marie Arouet (1694-1778) came to be known as “Voltaire” during his first stay in the Bastille in 1718, when he was imprisoned for saying and writing what he thought. The struggle to free the mind in the search for truth had been a long and bloody battle over many centuries against the church-and-state power structure backed by legalized violence. In this environment, the truth-searching process and the quality of knowledge still improved, but slowly.

The Enlightenment drew on centuries of experience from many cultures all over the world. Their examination, however, was not random but of that human rationality so prized by Aristotle, now exerting its influence in a dynamic, collaborative, and cumulative truth-searching process described in the work of Francis Bacon (1561-1626), and coupled with the scientific methods of Isaac Newton (1642-1727).  Adam Smith (1723-1790) interpreted the Enlightenment in terms of economics and presented his concept of a free market system that could eliminate material scarcity.  Immanuel Kant (1724-1804) pointed the way forward for nations to substitute law for violence.  The Marquis de Condorcet (1743-1794) summarized the direction for future human history based on the Enlightenment ideal and means (see chapter 3).

The Enlightenment also responded to John Locke’s  (1632-1704) challenge to find the best organization for human affairs:  “God who hath given the world to men in common, hath also given them reason to make use of it to the best advantage of life and convenience.”[4] Physician and philosopher, Locke was also a political thinker who specified that law should “have one rule for rich and poor, for the favorite at court, and the countryman at plough.”[5] 

  Locke returned to England after the Glorious Revolution of 1688, encouraged by the promise of new Constitutional freedoms, and continued his democratic advice by qualifying private property with sharing and limits: “What portion man carved to himself was easily seen, and it was useless, as well as dishonest, to carve himself too much, or to take more than he needed.”[6] The father of inalienable rights for all, government by the consent of the governed, and the application of reason in the search for the better life, Locke did not leave out of his list of priorities either the broad distribution of wealth or a warning against speculators who were clipping coins and debasing the currency (see chapter 7).

Thomas Hobbes (1588-1679) had suffered through the chaos of civil wars and the Cromwellian regime. Hobbes concluded, contrary to Locke’s later optimism, that humans are inherently murderous animals, and that only an all-powerful state, a Leviathan, could keep them in control.[7] Like Niccolò di Bernado Machiavelli (1469-1527) before him, Hobbes’s bleak view of people allowed little expectation that the world might become a better place.  Machiavelli, writing to impress the powerful Medici family in Florence , had proposed that “whoever organizes a state and establishes its laws must assume that all men are wicked and will act wickedly whenever they have the chance to do so.”[8]  Machiavelli, Hobbes, and others who believed evil to be inherent in human beings, offered a rationale for suppressing individual freedoms.  Unfortunately, the Machiavellis and Hobbeses, men of little accomplishment in their own time, have been elevated in the eyes of posterity to undeserved celebratory status by those in power seeking philosophical support for exploitation of the many by the few and the continued use of violence as a means to this goal.

Voltaire was one of the first in the West to study Confucius, and he developed great respect for the advanced Chinese culture. From his stay in England , Voltaire brought back an appreciation of English constitutional freedoms, Newton ’s scientific method in the examination of order in the universe, and Locke’s challenge to apply reason to the organization of human affairs.  As Locke had done before him, Voltaire advocated tolerance as the rational minimum on which basis social progress could be made.

The Enlightenment job of absorbing the wisdom of many cultures and ages was an impressive accomplishment, distilled from the thought of Arab, Jewish, Greek, and Chinese philosophers, as well as of European and American Christians, humanists, atheists, and deists.  The Enlightenment philosophers had come to the same conclusion that I had found in the factory. Performance can be maximized when one builds up from worth and great potential of each individual functioning in harmony with the group. Individual ambition is natural to humans, but concepts of the harmonious whole seem common in the thoughts of secular humanists such as Confucius’s “Reciprocity,” Kant’s “Categorical Imperative,” or what religion calls the “Golden Rule.”

By the end of the 18^th century, the struggle was continuing, but humans were winning their freedoms, and the way to a world of peace and plenty was well defined.  

The 18^th Century Enlightenment: Freeing Society from Material Scarcity  

The technology of the Industrial Revolution had raised the wealth-producing capacity of the economic system such that a properly organized society could produce more than enough for everyone.  Adam Smith in The Wealth of Nations [9] described an economic system that could free humans of material scarcity. Smith also wisely articulated the circumstances required and the impediments to be avoided. For the first time in human history, a system was available that could eliminate material scarcity, unify people in economic common purpose, and purge the violence that had been associated with the battle over scarce resources. The economic system that Smith envisioned was based on the theory that a free-market economy would self-correct and reach equilibrium with minimum governmental involvement. Smith published his seminal work in 1776, the same year that Thomas Jefferson (1751-1826) and others in America wrote their Declaration of Independence, presenting a political philosophy and structure that complemented Smith’s vision of economic freedom.

The American Founders expressed their idealism in the phrase “life, liberty, and the pursuit of happiness” for all. Jefferson, who had spent years in France , was acquainted with Smith and the Marquis de Condorcet, and he knew that these men of the Enlightenment were counting on the new American republic to lead the world to reach the ideal.  Condorcet expressed this view of America :  

One nation alone escapes the two-fold influence of tyranny and superstition. From that happy land where freedom had only recently kindled the torch of genius, the mind of man released from the leading strings of its infancy, advances with firm steps toward the truth.[10]   

The Enlightenment thinkers had undertaken their extraordinary examination in a Europe that had been dominated by violence and was heading for even more violence. They could see, nonetheless, that the American democratic experiment could demonstrate to the world that the ideal was attainable and that economic freedom was the means. The United States had then, as it still does now, a special opportunity with its people, resources, freedoms, and until recently, geographical isolation. With that opportunity came a continuing responsibility to confirm the ideal and refine the means for all of society.

Near the end of the eighteenth century, Condorcet summarized the work of the Enlightenment (see chapter 3) and penned a liberal manifesto that challenged society to free the mind, body, and spirit. Condorcet’s manifesto of liberalism advanced what Confucius had taught, and it included the new principles of Smith and Jefferson.  Condorcet’s manifesto remains as fresh in the 21^st century as it was revolutionary in the 18^th:   

Free trade, freedom of speech, freedom of press, the end of censorship, the end of slavery, the enfranchisement of women, universal free education, equality before the law, the separation of state and church, religious toleration, the adoption of a written constitution to insure the recognition of those rights, the establishment of a representative or parliamentary form of national government, and local self-government to encourage the independence and the participation of the peasants in government.[11]  

Condorcet was a remarkable man in his range of knowledge and his experience in science and government. I marveled more, however, at his optimism for a better life for future generations which he expressed while he was in hiding and then in prison waiting to die during the Reign of Terror.

The theoretical conclusions of the Enlightenment about the human response to better circumstances received practical confirmation early in the nineteenth century through the management of a spinning mill in Scotland by Robert Owen (1771-1858). Owen invested in the quality of life of his workers and their families, and his results experimentally verified that the form of capitalism that elevates people is more profitable than mercantilist capitalism that suppresses workers’ wages, benefits, and spirits to maximize owners’ profits. Owen felt that he had confirmed the system that was the way to a world of peace and plenty, so he took his discovery to the Church of England, to Parliament, and to European and American leaders assembled for a conference following the Napoleonic Wars. Few leaders listened and learned; consequently, the direction of history continued to be a struggle between the rational and the predatory.

The work of the Enlightenment answered the philosophical question about human violence and misery with a potentially positive reply:  Nothing reasonable accounts for human want, fear, or oppression; human reason argues for a natural human right to plenty, and for a right to many kinds of freedom, including freedom from fear and freedom from oppression.  The American experience inspired much of the world, but the coupling of democracy and capitalism proved too difficult for many nations, such as those in South America , to accomplish in face of the opposition from their traditional establishments. The freeing of the mind before and during the 18^th century had led to the economic-political system that freed some from the lack of necessities but left many still living unnecessarily in want, and most living in fear and oppression. 

The question for me then changed: Why has society not followed the Enlightenment way to peace and plenty during the two centuries following? The short answer is that too few people received the quality of knowledge from their education to be applied with growing democratic power to break the cycle of violence and exploitation. The long answer took me back to the study of the 19^th century.  

The 19^th Century: Freeing the Spirit!  

German Idealist G. W. F. Hegel (1770-1831) saw history’s direction as one of struggle and contradiction. Progress is energized by the human urge towards freedom, and reason is employed to reach this end, but reason can be  contradicted and progress opposed by countervailing predatory forces; consequently, human history is a three-steps-forward-and-two-steps-backward process.  

History was stumbling along this confused direction in the middle of the 19^th century when another German Idealist, Karl Marx, focused on Smith’s economic system with a capacity to eliminate material scarcity. Marx identified the reason that Smith’s system was functioning at only a fraction of potential: concentrated wealth. Marx then identified the solution: Change the mode of production, that is, the relationship between capital and labor in order to release the enormous productivity from involved workers. Genius lay in Marx’s tying progress in the human condition to the mode of production and the associated wealth-producing capabilities. Marx therefore proposed that history’s direction had been, and would be, based not on changes in culture or political structure but, rather, in movement towards a superior economic system.

Marx’s historical retrospection began with the limited wealth production that existed at the time of Aristotle when the mode of production was slavery.  Wealth had grown in limited ways, Marx realized, because the mode of production had changed slowly over many centuries from slavery to serfdom to the wage-slaves of his time.  Marx predicted that the productive evolutionary history of the human species was positioned for a great leap forward through individual development within a harmonious whole, though he worded it differently: “The free development of each is the condition for the free development of all.”[12] Marx’s equivalent to “the harmonious whole” was the “elimination of alienation.”  Marx was convinced that his evolutionary theory of workers who thought as owners, instead of as wage-slaves, would result in greater productivity and innovation and would supercede all prior theories about how to improve the human condition.  Marx’s way included “plenty” from the greater wealth production, and “peace” because the spreading wealth would unite people in economic common purpose and eventually reduce the power of the warrior state and eliminate violence.

Marx’s Idealism was similar to John Stuart Mill’s (1806-1873), for each foresaw an explosion of additional wealth coming through freeing the spirits of the workers.  Mill connected the dots among profits, spirits, and a moral environment in this way:  

It is scarcely possible to rate too highly this material benefit, which yet is nothing compared to the moral revolution in society that would accompany it; a new sense of security and independence in the laboring class; and the conversion of each human beings’ daily occupation into a school of the social sympathies and the practical intelligence.[13]  

Mill endorsed the benefits of worker ownership (see chapter 5), proposing that profits, quality of life, and a moral environment can be synergistically combined (see chapter 3). In the middle of the 19^th century, Mill’s proposal was radical because the economic system had not been reformed to provide neutral money, control of the speculators, broad distribution of wealth, and emancipation of the wage-slaves, all of which Smith had specified as prerequisites for the success of free markets.  In the early-21^st century, Mill’s proposal still seems radical because ultra-capitalism concentrates wealth in record amounts, and ultra-capitalists would continue to treat workers as wage-slaves.

Marx’s discovery coupled with Smith’s system refined by Mill’s insights might well have ended the conflict over resources because there was potentially more than enough for everybody. The end of exploitation and violence, however, required acknowledgement by those with power and authority of this better and broader way to wealth.  With the backing of government, religion, and learning, society could have followed the Enlightenment roadmap towards a new understanding of history’s rational direction. Smith provided the vehicle, Marx and Mill showed how to increase the power and speed. It did not happen that way, however.  

The 20th Century: The Lost Way  

At the end of the nineteenth century, optimism prevailed for further social progress during the twentieth century. America had demonstrated the benefits of economic freedom, and the Europeans had managed to limit the number of wars and even make wars more civilized by limiting the number of civilians included in the carnage. The twentieth century, however, instead of building on this positive momentum, became the most violent century in human history.  In economic maneuvers equivalent to this political and military devastation, finance capitalists managed to concentrate more wealth than ever before, while collectivists did not use growing democratic power to reform capitalism but rather used it to concentrate political power. Instead of a world uniting in economic common purpose, the nations reverted to barbarism and atrocity, including two world wars, ethnic cleansing of many peoples, the holocaust, the fire-bombing of cities, and the atomic bombs over Hiroshima and Nagasaki .

This human failure to move toward a world of peace and plenty during the twentieth century discouraged philosophers and forced many to conclude that humans were incapable of using reason to improve lives and eliminate the violence. Along with the millions of people killed by governments during the century, the ideal of a world free from want, fear, and oppression was itself a causality. In this vacuum of idealism, the world became dominated by those whose mission was to amass greater wealth, and by those comfortable with the use of violence for religious, ethnic, and nationalistic purposes.

Among the casualties in the death of idealism, for example, were two celebrity philosophers:  Isaiah Berlin (1904-1998) and John Rawls (1921-2002).  Both reacted to the century of record violence by declaring idealism an illusion and the Enlightenment search for truth useless.  Berlin used the failure of the “single solutions” of Hitler, Stalin, and Pol Pot as evidence that no solutions of any complexity are available. Rawls, who had contributed much to the examination of a just society, gave up on the effort to apply reason to find a better organization of human affairs:  

Whether there is or ever was such an Enlightenment project (finding a philosophical secular doctrine, one founded on reason and yet comprehensive), we need not consider it, for in any case, political liberalism, as I think of it, and justice and fairness as a form thereof, has no such ambitions.[14]  

Who killed idealism? Why did the great promise for society during the twentieth century turn so violent and bloody? Were Berlin and Rawls correct in abandoning idealism and the Enlightenment challenge?  Let us rather, I suggest, lay the blame where it belongs:  Reformers failed to realize the ideals of the Enlightenment because they failed to synthesize the means presented by Smith, Marx, and Mill, and consequently failed to modify the political structures in support of the superior economic system. Capricious leaders were still allowed to fumble their way into WWI followed by more failure of leadership that made WWII inevitable.  Subsequently, other untrained leaders continued to make mistakes in power politics resulting in violence. The process was imperfect, the quality of knowledge poor, and the tragic mistakes inevitable from this failure.

The circle of people united in trust and working in cooperation continued to build wealth and good feelings, demonstrated in the improvement in the lives of hundreds of millions in America and other countries that moved away from tyranny towards economic freedom.  Economic and social progress was constrained, however, as it always had been, by those motivated by greed and comfortable with exploitation and the use of violence.   

The 21^st Century: Another Chance to Find the Way  

Another new and promising opportunity for society seemed to arise in the 1990s when all could see that collectivism with its central planning and state control had failed to deliver on its social contract.  With the fall of the Berlin Wall and the collapse of the international Communist movement, the contrast between collectivism and economic freedom demonstrated again that freedom, not collectivism, is the way to improve the peoples’ lives. Besides this empirical evidence of what works and what does not work, other developments also put in a new light the understanding of Marx’s proposed changes in the relationship of capital and labor. The Information Age added enormous productivity to the economic system that could be attained only in the democratic capitalistic culture that eliminates the alienation between labor and capital. Equally dramatic, workers in the United States became a major source of new investment capital.  Class struggle between capital and labor must be at an end when the wage earners and the capitalists are one!

Reflecting these profound developments, new idealists were again proclaiming a world of economic common purpose that would lead to a world of peace and plenty for all. Francis Fukuyama, for example, gained recognition by affirming that the world was moving in the direction of liberal democracy and free markets, for, he reasoned, with the demise of Communism and the failure of collectivism, no other ideologies remained to compete.[15]  Fukuyama ’s End of History thesis was contrasted, however, with Samuel Huntington’s Clash of Civilizations, a proposal that a half-dozen major cultures would not converge but would remain fracture lines for global conflict.[16]  After the events of 9-11, Fukuyma’s critics reported that “history has returned from vacation.”[17]   Fukuyama defended his thesis, placing 9-11 in the context of fanatics in a shrinking world who had reacted to the inevitability of their young people’s demand for the freedoms and comforts that they could now view on television and visit on the internet. Fukuyama expressed it this way:  

The struggle we face is not the clash of several distinct and equal cultures like the great powers of nineteenth-century Europe . The clash consists of a series of rearguard actions from societies whose traditional existence is indeed threatened by modernization. The strength of the backlash reflects the severity of this threat.[18]  

Fukuyama and Huntington thus brought the historic dichotomy up-to-date:  Will society adopt the rational economic system that can eliminate material scarcity, elevate spirits, and unite people in economic common purpose, or will society continue to struggle in the grip of destructive emotion and violence? Fukuyama ’s argument had economic and social logic on its side; Huntington ’s had the human history of folly and violence.

Despite favorable circumstances at the turn of the millennium, the idealists were dashed again! The impediment of concentrated wealth had grown because ultra-capitalism dominated the world’s economy. The reformers still did not know how to synthesize Smith, Marx, and Mill in order to learn how to democratize capitalism. A large part of investment capital, most of it the workers’ money, went into speculation rather than being directed towards the job-growth economy. Corporate surplus was not being distributed in dividends to the wage earners but was being diverted to Wall Street priorities. The bubble economy of the 1990s rewarded the few in the up direction and hurt the many in the down, as it had done before in similar economic swings many times since the beginning of the American republic.

The same corruptions of ultra-capitalism that were damaging the domestic American economy were doing even worse damage on the international scene to emerging economies. Few recognized the connection between the reversal of strong economic growth in Indonesia and the attacks of terrorists on 9-11.  The connection was indirect, but after U.S.-led ultra-capitalism had destroyed the Indonesian economy (see chapter 7), social tensions and violence in this largest of Muslim nations displaced the sense of economic common purpose associated with a rising standard of living.  Terrorists then found a fertile environment for the recruiting and training of more terrorists.

Optimism at the end of the nineteenth century was destroyed by WWI. Optimism at the end of the twentieth century was destroyed even more quickly on a single day, September 11, 2001 .  Before this atrocity, America was regarded by many as an arrogant unilateralist with a cop-of-the-world attitude. After the tragedy, some American officials ignored the history of all empires, apparently convinced that the U.S. could run the world. Others recognized that terrorism is guerrilla warfare and particularly requires multilateral U.N. action, and, further, that the only thing that can break the cycle of reciprocal atrocities is a rising standard of living worldwide.  

The Crossroads in Human History  

By the middle of the 19^th century, the way to a world of peace and plenty had been made clear in theory, was available in principle, and was being validated in practice. Why, then was society still debating the attainability of the ideal at the beginning of a new millennium?  Why, then, had the impediments to that superior form of commerce that is the basis for social progress not been removed?  Why, then, were the folly and violence escalating?  I have written my answer to these questions in this book, now I summarize in these few lines:  

·        Before the Industrial Revolution:  Concentrated wealth among the elite, and violence among nations and people, dominated society because resources were in fact limited.  The miserable majority found idealism primarily in the spiritual realm.

·        Late-18^th century: The Enlightenment in Europe , the British Isles , and America proposed the secular ideal, the means to attain it, and the process to identify both.

·        Mid-19^th century: Marx and Mill confirmed that Adam Smith was correct: Material scarcity could be eliminated.  They proposed ways to increase wealth further and spread it broadly to eliminate the impediment of concentrated wealth.

·        20^th century: Reformers chose collectivism instead of the free-market principles of Smith and the worker-ownership proposed by Marx and Mill.  This choice caused the bloodiest century in human history.

·        Beginning of the 21^st century: A world of peace and plenty through economic freedom and economic common purpose has its best opportunity to succeed for these reasons: The Information Age requires the democratic capitalist culture; the Information Age has added multiples of productivity; the Information Age is itself a unifying influence; wage earners in America have become a major source of new capital; and the evidence of the benefits of economic freedom have been demonstrated not only in democratic but also authoritarian countries.

·        Beginning of the 21^st century: America should be leading the world to peace and plenty through economic freedom but is, instead, supporting ultra-capitalism that has slowed the world’s economy and reversed economic momentum in many countries. The world’s wealthiest nation is supporting a system that further concentrates wealth; the world’s most militarily powerful nation is being trapped in reciprocal atrocities by a relatively few fanatics.  

This crossroads in human history sets before us the choice whether to follow the way to peace and plenty or to take the well-troden way to more terrible folly and violence. At this intersection, I want to erect some guideposts, and so I propose the following hypotheses. They are arranged according to a sequential logic:  The validation of one hypothesis is necessary before moving on to the next. Assuming that the validation has successfully proceeded from #1 through #7, then hypotheses #8 and #9 suggest movement to required action. 

I find myself again in agreement with Karl Marx that only after the world is improving lives through a superior economic system will it be possible to stop the violence. Thus the ultimate success of the United Nations in substituting law for violence among nations, proposed in hypothesis #10, is predicated on the visible success of economic freedom worldwide, success that I believe will be attainable if we act according to these hypotheses.

I propose that Enlightenment II, an undertaking by teams of multi-disciplinary, multi-cultural truth-searchers in the universities, examine these hypotheses and develop a curriculum for the education of citizens and the training of leaders (see below, hypothesis #8). Institutional investors and other groups could from their own examination and by cooperation with the universities more quickly derive an action agenda to refine capitalism and restructure government (see below, hypothesis #9).  A hopeful solution in these troubled times is emergence of leaders with the intellect of Jefferson, the relentless determination of Washington, and the capacity of  Franklin to get things done, people of statecraft who will draw on the will, wisdom, and votes of the majority to reform America and lead the world to peace and plenty. I invite examination, challenge, debate, rejection, refinement, or validation of these hypotheses.  

Hypothesis #1—The Ideal: A world of plenty is attainable on the basis of a superior economic system supported by the culture and the political structure.  

            Economic freedom has demonstrated the capacity to eliminate material scarcity, elevate spirits, and unite people. The satisfaction of the basic needs for food, clothing, and shelter through economic freedom is naturally coupled with improvement in health and education; this, in turn, stimulates hope for further improvement in future generations. Changes in the culture and political structure, unless directed to improve the economic system, do not improve the lives of people and frequently make them worse.

            A world dominated by violence among nations and concentrated wealth does not improve lives; instead, it leaves a large part of the world living in misery, not free of want; a good part of the world living under tyranny, not free of oppression; and most of the people of the world fearful for the future.  During the twentieth century, 160 million people were killed by governments, and wealth was concentrated in record amounts.  This empirical evidence demonstrates that the direction of the world is under the control of those whose mission is to build and use nationalistic power, no matter how many innocent people are killed, and to concentrate wealth, no matter how badly they damage the world’s economy.  The most fundamental of all principles in human affairs, the worth of each individual, was obscenely violated throughout the century by the killing of so many innocent people. The obscenity was so pervasive and repetitive that many citizens were conditioned to accept it as the norm as they watched its repetition early in the 21^st century.

In prioritizing the support of the economic system by the culture and political structure, we begin with affirmation of the most basic tenet that all people can reach their potential only after satisfaction of their needs for adequate food, shelter, clothing, health, and education, and that only the economic system can satisfy these needs.  A superior economic system provides jobs, income, products, and services to fulfill these needs of society, and it also generates the tax revenues through which we can assist those not included in the benefits of the economic system.  The economic system, further, underwrites good education and health that elevate peoples’ spirits and foster an expanding sense of shared community.  On the first premise, that a superior economic system ought to be sustained by the culture and the political structures, the ideal of individual development for all in a harmonious whole is attainable.

As obvious as this may seem, the world has been managed another way because leaders have repetitively given priority not to the economic system but to the culture and political structure.  If the terms of this hypothesis are both obvious and ignored, then we must acknowledge the economic and social tragedies caused by failing to act according to them, and we must acknowledge that similar or worse tragedies are liable if we do not validate hypothesis #1 and act accordingly. For example, Woodrow Wilson tried to substitute fuzzy idealism for economic principles at the post-WWI conference with tragic consequences for the direction of history during the rest of the 20^th century. Wilson ’s biographer wrote the following:   

Wilson had little time to ponder deeply on the economic causes of war, from the beginning of the peace process he had relegated economic matters to subordinate places. Wilson ’s first love was politics, not economics.[19]  

The most powerful man at the post-WWI peace talks ignored the principles and implications of hypothesis #1 that social progress depends on movement to a superior economic system.  Others at the peace talks were appalled at Wilson ’s ignorance. John Maynard Keynes (1883-1946) left the British team to go home and write a book on the subject.[20]  

I propose that Marx’s priority for the superior economic solution can be applied in retrospect as the way to have avoided violent events in history.  At the time of the American Revolution, as another example, British Parliamentarian Edmund Burke warned King George III that British economic interests were being sacrificed in the effort to maintain political control of the Colonies.  George III did not listen.

The American Civil War killed 620,000 young Americans and added enormous economic cost to the national tragedy.  Most Americans, including many Southerners, had realized that slavery was an ideological contradiction to everything that America stood for, but slavery was also an economic problem that in the course of a generation could have had an economic solution. 

The Russian Bolsheviks stole the 1917 Revolution and made radical changes in the political structure that deflected attention from Marx’s intended rearrangement in the relationship between labor and capital. This priority for changes in the political structure, instead of economic reform, led to decades of violence and misery!

The Social Democrats in Germany in the 1920s were poorly trained in economics and could not overcome the problems left over from the faulty peace talks of 1919, Wilson ’s legacy. The resulting desperate economic circumstances in Germany destroyed social cohesion and set the stage for Hitler and his reign of evil.

The argument that the bloody 20^th century was the result of avoidable errors can be demonstrated both by analyzing the failures and by evidence of other leaders who gave the necessary priority to economic freedom. After WWII, the United States used its power and money to repair the ravages of war and set the world on the way to economic growth and better lives for many. The Marshall Plan was one of America ’s proudest moments because President Harry Truman and General George Marshall understood history and economics well enough to make the right moves. Any criticism that it was self-serving, and in time helped the U.S. economy, misses the point, for mutually beneficial results are the essence of economic common purpose.

The United States provided the money and encouragement, but free market-experts such as Ludwig Erhard, German Finance Minister and later Chancellor, made it work with an amazing 8% sustained national growth rate. The economic recovery in both Germany and Japan demonstrates what can be accomplished when the national mission is improving the lives of the people through economic freedom, not through war and geopolitics.

Each of these cases, I argue, supports hypothesis #1: When the priority is movement to the superior economic system, not changes in the culture or political structure, then the lives of the people can be improved. The ideal of plenty through economic freedom, as proposed by the Enlightenment, has never been reached because neither have conducive circumstances been put in place nor have the impediments been removed.  At the head of this chapter, I cite FDR’s observation:  The problem is not that free enterprise has failed; the problem is that free enterprise has never yet been tried on a sustained basis.

Validation of hypothesis #1 will serve as the first building block for the improved organization in human affairs. The examination can then proceed to a definition of the superior economic system, hypothesis #2.   

Hypothesis #2—The Means: The superior economic system is democratic capitalism based on economic freedom, private property, competition, neutral money, and protection from speculators. Democratic capitalism maximizes wealth because workers are motivated to produce and innovate in a trusting, cooperative environment in which they share in the surplus of improved performance.  Worldwide economic growth becomes stronger because of the workers’ motivation, and steadier as a result of the broader distribution of wealth.  

By the later part of the nineteenth century, economic freedom had been experimentally verified through improvement in the lives of millions of people, particularly in America . The great wealth that was produced by this system was then distributed to those whose purchases kept the economy growing and spreading through free trade.  This was the free market system summarized by Adam Smith in these words:  

Little else is required to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice; all the rest being brought about by the natural course of things.[21]  

The dynamic that Adam Smith proposed is an economic perpetual-motion machine. Leave it free and it will steadily reduce costs, add volume, and spread wealth around the world through free trade (see chapter 6). Economic freedom will not only eliminate material scarcity, the source of the traditional struggle, but also it will foster the harmony and trust that has been thwarted throughout human history.

Adam Smith was not an apologist for greed, as he has been frequently translated to be; he was, rather, a champion of the workers.  He was an enemy of mercantilism and the concentration of wealth, and he qualified the success of his system in terms of the availability of non-volatile, patient money, and the control of speculators. Smith warned that the “prodigals and projectors,” as he called them, would deflect money from the job-growth economy and waste it on speculation.  In Smith’s vision, strong and steady economic growth would spread wealth broadly if the wild and destructive swings in the economy were purged by directing currency and credit to the job-growth economy.      

Karl Marx and John Stuart Mill were inspired by Adam Smith’s description of a system that could actually eliminate material scarcity.  The message that Marx and Mill got from Smith was of economic freedom that combines the productivity and innovation of involved workers, the technology of the Industrial Revolution, the motivation of private property, the monitoring influence of competition, and a government that secures ample, low-cost, non-volatile, patient money.  Mill integrated all of these vital components, but Marx failed to assimilate the importance of private property and competition.

Mill studied socialism carefully and concluded that the Socialists had taken a wrong turn when they took competition and private property out of the economic equation.  Subsequent history proved Mill correct, for central planning not only is inefficient but also it destroys motivation at all levels.  The prospect of honest competition is the fuel that energizes Smith’s economic perpetual-motion machine, for competitors constantly raised the levels of productivity and excellence in product design, reduced the cost to produce, and improve their marketing skills. 

This economic system that offers to improve the quality of life in a moral environment can be rationalized in several ways. Mechanical engineers could explain the superiority of democratic capitalism on the principle of friction and force: More friction results in less force; less friction results in more force. The parallel in human relations is this: More alienation results in poorer performance; less alienation results in better performance.

         Social scientists could explain the superiority of democratic capitalism because it appeals to both sides of the human duality: individual ambition and the instinct for social cooperation. Democratic capitalism rejects the motivation of “greed is good” morality and the theory of Social Darwinism as one-dimensional and overly individualistic.  The self-centered approach ignores, and in fact contradicts, the more powerful benefits resulting from combining individual ambitions with cooperative efforts.

Statisticians could verify the superiority of democratic capitalism by referring to the large database of democratic capitalist companies that have demonstrated superior long-term performance in competition with those who treat workers as a cost commodity (see chapter 4).  This comparative record would be even more impressive if Business Schools presented democratic capitalism for student examination, thereby adding substantially to the pool of young managers inspired by the philosophy and trained in the protocols.  Instead, democratic capitalism has had to be reinvented through trial and error by successive generations of democratic managers.

Democratic capitalism is superior to other economic systems because it is freedom based and enhances the natural characteristics of humans. The human urge is to bond together in order to be free of want, fear, and oppression.  Nevertheless, humans throughout history have been forced to settle only for freedom from want in a commercial world that was run on the basis of fear and oppression.  Democratic capitalism, by contrast, is based on the natural human state in that it allows everyone to be free of want, but it accomplishes this in a working culture that frees people from both fear and oppression. 

The superiority of democratic capitalism can be tested and verified in many ways, but how universal can it become?  Is it a “Western” phenomenon only?  What political structures are required for its success?  In hypothesis #3, I propose that it can be a universal system.  

Hypothesis #3—The Universal Economic Solution:  Democratic capitalism can be universal because it has demonstrated the capacity to raise the standard of living and improve the quality of lives under both democratic and authoritarian governments.  

Economic freedom works best within a democratic structure because freedoms are complementary:  Economic freedom contributes to and enhances political and social freedoms; social and political freedoms contribute to and enhance economic freedom. Economic freedom has been demonstrated to work, nonetheless, under authoritarian governments so long as the government’s true mission is the welfare of the people. Economic freedom cannot work in a totalitarian structure, but in our increasingly interdependent world, people recognize the failure of totalitarian governments to improve lives; therefore, younger generations in most societies are applying long-term political pressure to move their governance towards economic freedom.

Both Adam Smith and the Marquis de Condorcet recognized that the new American republic would have the best chance for economic freedom to work because democracy and capitalism are inherently synergistic. Despite the impediments of concentrated wealth and collectivism, economic freedom in America did improve the lives of many millions, thus confirming Smith’s theory and Condorcet’s optimism.

In the late-twentieth century, Lee Kuan Yew demonstrated in Singapore that economic freedom can also improve lives under an authoritarian government.  Singapore ’s transition from being a third-world to a first-world economy was used as the title of Lee’s book.[22] Even more impressive was the improvement in the standard of living and quality of life in authoritarian Indonesia , the world’s largest Muslim country, with a total population of over 220 million people (see chapter 7). 

Authoritarian China is a work-in-progress, but it has already improved the lives of more people through the introduction of economic freedom than any other country in history has done. All of these efforts under authoritarian governments have included serious imperfections, as also do efforts at economic freedom in democratic cultures, but if the criterion of success is the improvement in the quality of millions of lives, then they succeeded. 

Many believe that economic freedom should be paralleled by political liberties, such as the freedoms of the press, assembly, religion, civil rights, due process, and democratic elections. This perception that economic freedom and democratic rights go hand-in-hand is correct in the long term.  Short-term, however, economic freedom is so powerful that it can work under conditions of limited political freedom; indeed, it becomes a compelling force towards greater political freedoms.  This assumption is based on the belief that once the freedom genie is out of the bottle, once people are more economically comfortable and better educated, then political freedoms will follow. Some political activists give priority to political freedoms over economic freedom, but it has been demonstrated that this sequence does not work well.  Many American politicians seek political gain by criticizing other country’s human-rights violations, but they fail to place the complex management of change from tyranny to economic freedom in the context of a long process that must begin with economic improvement. 

Jean-François Revel, a former editor of L’Express and winner of many European honors, proposed that “economic freedom sooner or later leads to political liberty.” Revel then made this distinction:  

What is needed is less state and more government. The democratic renewal stems from nothing so much as the practical necessity of diminishing statist omnipotence and impunity while enhancing governmental competence and responsibility—for humanity cannot persist in self-destruction.[23]  

This sensitive relationship between liberty and democracy, including the dangers in rushing to democratic elections before economic momentum has been gained, has been well examined by reporter Fareed

Zakaria in The Future of Freedom.[24] Zakaria points out that a rush toward democracy can be counterproductive unless a structure of law is in place.

The proposal that economic freedom will eventually lead to political freedoms is particularly convincing in the Information Age because the profile of the educated, independent-thinking employee is the same as the profile of the citizen who