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 5:7

Hypothesis #7—The Process: The ideal of a world of peace and plenty achieved through the means of democratic capitalism has not been reached because of failure in the truth-seeking process.  

The inability of reformers to connect social progress with the superior economic system led me to an analysis of truth-seeking.  If the economic system that could eliminate material scarcity, elevate spirits, and unify people had been so well defined by Smith, Jefferson, Condorcet, and others, and if the key impediment of concentrated wealth had further been identified and resolved in theory by Marx and Mill, why does the bottom one-third of the people of the world still live in misery. Why is so much of the world still so violent?  Why have so many brilliant philosophers abandoned idealism when the opportunities seem so great?  I have concluded that the reason is an egregious, persistent failure in the truth-seeking process.  This failure itself seemed inexplicable because the process had been tested by the Enlightenment and has been available for use for 200 years.  The culture, particularly the universities, I concluded either have not done their job or did it poorly.

Thousands of idealists for thousands of years have grappled with the question of how to seek knowledge to improve the human condition.  In my studies, I found that coupling the philosophy and protocols of Aristotle and Francis Bacon provides the best process for that mission. Aristotle used his training as a biologist to determine the growth potential of all living things, and then he addressed the conducive circumstances required and the impediments to be removed. This seems to me to be a straightforward way to find what the fullest growth potential of the human species might be. Aristotle’s process seems familiar because it is how most managers seek excellence:  “What’s the best we can do if we do everything right?  Which tools do we need to do it?  What obstructions do we need to get out of the way?”

Most of the Enlightenment thinkers were inspired by the work of Francis Bacon who was Lord Chancellor of England before being driven out of office by his political enemies. He then dedicated his life to examining the correct process to ascertain truth.  One of the stars of the French Enlightenment, Jean Le Rone d’Alembert (1717-1783), praised Bacon in these words:  “At the head of these illustrious personages should be placed the immortal Chancellor of England, Francis Bacon, whose works, so justly esteemed, deserve our study even more than our praise.”

Bacon was convinced that the curriculum in the universities neither equipped students for leadership in business or government nor did it teach them to think clearly.  Bacon attacked the resulting superficiality in the thought process:  
The primary notions of things, which the mind readily and passively imbibes, stores up and accumulates, are false, confused, and over-hastily abstracted from the facts. Whence it follows that the entire fabric of human reason, which we employ in the inquisition of nature, is badly put together and built up like some magnificent structure without any foundation.
Bacon had to attack the Aristotelian curriculum of his time as it was being interpreted by 17th century Scholastics, and he did this in part by calling for a return to a more authentically Aristotelian investigation of things in the search for their essences, study of their growth potential, discovery of the favorable circumstances required, and identification of impediments to be removed.
Bacon espoused learning from experience, testing the resulting generalizations, and then moving onto higher levels of generalization in a process that is dynamic, collaborative, and cumulative:  

Drawing upon Aristotelian examination and Baconian process, the 18th-century Enlightenment made available to successive generations as their legacy an attainable ideal, a workable means, and the process to identify both. 

In the latter part of the 19th century, despite availability and clarity, the culture and the political community failed to follow the path because they failed to follow the process.  Instead of reforming the economic system as the way forward, ideologues and politicos took a wrong turn: Contradicting hypothesis #1, they tried to reform society by changing the political structure. This process failure resulted in the misdirection of reform energies into political structure rather than into greater wealth creation and broader wealth distribution.  The terrible result of this process failure was a twentieth century in which millions of innocents were killed and hundreds of millions lived in misery.  By the end of that century, the leaders of culture and the elected politicians, instead of viewing the damage and correcting the errors, were continuing to make the same mistakes with the same threatening economic and social consequences.

Mistakes by American leaders during the 20th century violated Bacon’s process because the truth-seeking was inadequately dynamic, collaborative, and cumulative. Among the examples of these process errors that contributed to the folly and violence, one may include President Wilson’s fuzzy idealism and disinterest in economics that contributed to the flawed peace talks in 1919, and the failure to get American participation in the League of Nations; President Hoover’s three egregious errors that exported the stock market correction into the Great Depression (see chapter 7); and the misreading of the nationalistic motives of Ho Chi Minh and Vietnamese leaders that caused the war in that country. In the last quarter of the 20th century, successive Presidents made mistakes in economic principles that caused excessive volatility and liquidity; these, combined with deregulation and the suspension of market disciplines, launched ultra-capitalism on an unsuspecting world. Both the ideologues of the “liberalization of capital markets” and the proponents of a worldwide manifest destiny for America in which we unilaterally determine which governments should survive, violate Bacon’s process in every respect. They are not sufficiently reiterative; they fail badly on the diversity of disciplines and cultures and they are not cumulative in their assimilation of historical evidence.

The process failure in all of these examples manifested the usual errors of imperial-minded formalists applying old answers to old questions, for the process has been secretive and static instead of dynamic and reiterative.  The process has been authoritarian and punitive rather than collegial and collaborative, for it lacked representation by various disciplines and the multiple perspectives of different cultures.  The process perpetuated ideological concerns even after the evidence of error became obvious. Finally, no unifying intelligence collected and codified their knowledge which would have added  validated building blocks to the edifice for the organization of human affairs.

At the turn of the millennium, the world was making the same mistakes it had made a century before.  Not only were our leaders failing to seize the opportunity to unite in economic common purpose but also they were going backwards economically and backwards to new forms of violence. The sad record of the 20th century validates hypothesis #7, that global social progress has been retarded by persistent and egregious mistakes that should have been avoided by the correct truth-seeking process. The common denominators in all of these errors were ignorance and arrogance in the otherwise bright minds of sincere people who nevertheless lacked understanding of economics, the management of change, and the structure needed before freedoms can become functional.  Among the first agents of change to employ the correct truth-seeking process in order to reconfirm the ideal and specify the means ought to be the universities; this is hypothesis #8.

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.

Most Recent Post

Democratic Capitalism: The Way to a World of Peace and Plenty

Updated on Jan 11, 2017

For some time there has been a general feeling that there is something wrong with the American economy. There is: the domination by finance capitalism slows growth and keeps millions from good jobs.

The solution: Democratic Capitalism, was described in my book but it was rejected by publishers and received no reviews. I published and distributed it at my expense but in time the following leaders of industry and education confirmed the solution. 

Click here for the full post