Book Cover

Capitalism,  The Way to a World of Peace and Plenty
by Ray Carey

Hard/Softcover/Kindle - 5 May, 2004, Available on

Ray Carey presents the theory and practice of democratic capitalism by coupling his experience with a synthesis of the thought of Adam Smith, Karl Marx, and John Stuart Mill.  The empirical evidence is clear: democratic capitalistic companies produce superior results, and nations that support economic freedom and keep money neutral improve the lives of their people.

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Course 1:12

Educators: Real Reform Depends on You!

During the past quarter-century, making money on money became the American priority. Finance capitalism dominated the job-growth economy as their profits skyrocketed from 4% to 40% of total corporate profits. According to Kevin Phillips in Boiling Point (Random House, 1993), financialization of the economy has historically put other nations into terminal decline.  Can America avoid this fate?

Citizens could use their pension shareholdings to reform corporations, and their votes to shift government support from bad to good capitalism, from finance capitalism to democratic capitalism. Unless educators present students with knowledge about these alternatives, however, democratic capitalism will still lack visibility and the American economy will continue to be dominated by finance capitalism.

“Good capitalism” is contrary to the academic contempt for commerce that goes back to Plato who wrote in The Laws that “trade should be made over to a class of people whose corruption will not harm the state.”  Ever since, this mind set has discouraged  recognition of democratic capitalism.

Karl Marx, however, challenged the world with his evolving mode of production based mainly on the fundamentals of democratic capitalism. An understanding of Marx’s visions could provide educators and students with the knowledge needed for reform.

John Stuart Mill integrated these visions with competition and private property. Mill also recognized the synergy between material production and the moral environment in which the great increase in wealth from worker ownership “is nothing compared to the moral revolution in society that would accompany it; a new sense of security and independence in the laboring class.” (Principles of Political Economy, 1848)

Marx was wrong in his prediction that downward pressure on wages would provoke a proletarian revolution. During the following century, the number of hours worked went down and wages went up. Capitalism, however, still functioned at a fraction of its potential because most capitalists were top-down autocrats whose employees worked in a culture of fear and intimidation. Wealth, however, came to be distributed more broadly based on business judgments, not economic theory. In 1915, Henry Ford realized that his workers could not buy the model T’s they built unless he raised their wages to $5 a day.

During this time, thousands of companies discovered the benefits of a democratized work culture and the sharing of profits. A few far-sighted politicians, such as Senator Russell Long in the 1970s, urged passage of supportive tax laws.

Marx’s theories have been confirmed many times in practice, but unfortunately, the intellectual community has yet to discover democratic capitalism, and real reform will not happen until they do. The economic disaster of 2008-2010 was unnecessary and tragic; it will be even more tragic if the superior economic system does not now gain visibility, and the government and corporate sector do not support it with these reforms:

When Business students are presented with democratic capitalism, they will be excited by the opportunity both to do good and to do well. A new generation of managers will end the compensation feeding frenzy because they will understand the destructive effect of excessive compensation on team spirit.

The moral dimension within democratic capitalism, identified by Mill, will combine with the economic logic that improves lives in all cultures. Democratic capitalism will become the universal economic system finally reaching its potential to eliminate material scarcity, unite people in economic common purpose, and stop the violence.

Ray CareyRay Carey

Ray Carey learned through managing companies for 33 years how to change the work culture to provide employees with their best opportunities to develop and contribute. This experience began as a 28 year old plant manager and later president of an electric motor company, and concluded with eighteen years as president , chairman, and CEO of ADT, Inc.

See Carey's autobiography of his work career in chapter two of his first book,

Democratic Capitalism, The Way to a World of Peace and Plenty.

For more information about Ray Carey and his advocacy of democratic capitalism, visit the pages of this website.

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Owen decentralized to the work station and let the workers run their jobs. This was the key to motivate the workers to produce and innovate more. It required a management that understood the philosophy and were trained and motivated in it themselves. The Mercantile philosophy, however, was still one of maximizing profits by suppressing wages and benefits. In contrast, Owen's capitalism added worker income that was spent to the benefit of economic growth called the "multiplier effect".

Owen understood that the "intellectual" community demeaned his proposals. Early in the 19th century Owen had demonstrated the capitalism in which capital and labor were synergistic.Owen also identified the intellectual negative attitude towards capitalism that continues to the present.

This is still the challenge to the intellectual community to study the alternatives in capitalism in order to promote the one that maximizes the amount of wealth and distributes it broadly.

Owen joined the Manchester Literary and Philosophical Society. Its members were the elite of the town whose manners had been acquired in respected schools. In their company Owen never forgot his origins: 

I was yet but an ill-educated awkward youth, strongly sensitive to my defects of education, speaking ungrammatically, a kind of Welsh-English …I felt the possession of ideas superior to my power of expressing them, and this always embarrassed me with strangers, and especially when in the company of those who had been systemically...

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