If you want a robust, politically stable capitalist system, make sure you have a lot of capitalists. Thatâs not as easy as it sounds, according to economic thinker Jeff Gates, because capitalism is extraordinarily good at creating more capital (the rich get richer) but lousy at creating capitalists. It does a great job ferreting out financial returns but an abysmal one creating customers with a stake in the system, able to buy the goods produced. With capitalism now the worldâs model and a growing disparity between the worldâs rich and poor, Gates fears capitalismâs disconnect is its Achilles tendon.

      Profound economic inequity is a global challenge, according to Gates, who has worked as a financial advisor to governments, corporations and unions in 26 countries. He sees financial colonies replacing political ones, worldwide, starting at home. Assets held by Americaâs richest 1% dwarf those held by the bottom 90%; 37 Mexican families own 40% of Mexico, 13 families control Venezuela, 6 in El Salvador, 300 in Pakistan. And in Russia, following American advice, six clans are consolidating enormous economic and political power. Meanwhile, three billion people now live on less than $2 a day and at the rate weâre going, that number will almost double in 30 years. Jeff Gates puts faces to these numbers and asks, ãWhere is our humanity?ä

      Why not let the ownership mechanisms that works so well for rich people work for the growing numbers of have-nots? Give ordinary people a stake in capitalism. Create ownership solutions. Insist regular people share in both private propertyâs financial risks and financial gains. Find ways to turn company workers into company owners. Create mechanisms by which employees can take stock in companies, not cash out of them -- companies actually perform better and bottom line performance is enhanced when workers are connected to their companies through ownership.

      Itâs time we acknowledge there is no ãinvisible handä of the market, only financial forces over which people have the right to exercise influence. It wonât be easy. Capital markets roll over policy makers every day, so itâs going to take collaboration between the private and the public sector to strengthen capitalism by creating capitalists.

      Gates insists we have to get into the heart of our system -- a financing system -- and engineer capitalism for inclusion. Start by asking what we want from our economy - a job ethic or an ownership ethic? Then raise our hands, tell our politicians, our fellow workers and the people we work for and with, ãIt doesnât work for me to be left out here with only my labor to generate income.ÊIf weâre going to have a robust capitalist system, weâre going to have to find a way to make me a capitalist. And quit pretending I can buy my way into the system simply from the earnings of my labor. Thatâs never worked.ä

      The beauty of our political economy, Gates reminds us, is that it does respond. But it wonât respond if we donât ask. The worldâs political stability hangs in the balance.

Conversation 1

Economist Jeff Gates describes the enormity of the economic changes precipitated by the fall of the Soviet bloc to Paula Gordon and Bill Russell. Gates explains how, Russia -- acting on the advise of the United States -- may well recreate an ownership pattern similar to what they had during the Czarsâ times. He reminds us that putting political and economic power in the same hands results in The Gulag. He sees very concentrated ownership as the overall geopolitical pattern, with dramatic, destabilizing consequences.

Conversation 2

Gates shows how ownership solutions can help achieve sustainable economic systems. He suggest how Adam Smith would use todayâs new science of complexity, then considers the economic effects of not having enough people included in the concept of property rights. He urges real conservatives to be worried by todayâs system which leaves so many people out. He relates property and power, noting that the assets held by the top 1% of Americans dwarfs those held by the bottom 90%. He describes troubling marketing trends based on Tiffany/K-Mart marketing strategies. Capitalism, Gates maintains, does a great job of financing capital but is terrible at creating capitalists. He describes ownership solutions with which to create a truly vibrant capitalism.

Conversation 3

Gates describes the global paradox of defaulting to purely financial forces, offering examples of how the capitalist economies of Germany, Korea and Japan might right the balance. He finds it odd that the United States -- the worldâs mentor capitalist economy -- has failed to address who should own the property we are urging people around the world to honor. He uses 200 yearsâ experience to demonstrate that people are unable to buy their way into capitalism. He urges ãup-close capitalism,ä which includes sharing risk as well as rewards. He describes the impact changing our focus from jobs to ownership would have, demonstrating how including people in an economy empowers them.

Conversation 4

We no longer have political colonies, Gates observes, we now have world-wide financial colonies, which has devastating consequences. He suggests ways out of that bind. ÊHe describes the worldwide Achilles heel of market capitalism and posits solutions based on ownership. Based on his experience as Counsel to the US Senate Finance Committee from 1980 to 1987, Gates describes the effects of supply-side economics, where both mainstream political parties failed to ask who was going to be supplied, then sent the bill to the American taxpayer. He offers a powerful analogy to describe the result.

Conversation 5

Gates urges people to ask what they want from their economy, then describes how productive assets can work for ordinary people the way they have for the rich. Where the cash flows, ownership grows, Gates believes, and gives examples. He shows why policy alone is not sufficient to make the changes needed to assure a sustainable economy. He declares policy alone insufficient to make the changes needed to assure a sustainable economy, calling for a collaboration between the public and private sector . He describes Employee Stock Ownership Plans - ESOPs - as one alternative and offers examples of what works and what doesnât.

Conversation 6

Gates says connectedness is his central theme, believing a personâs job is not a strong enough connection to a capitalist economy. He urges people to find ways to upgrade their labor as its value continues to depreciate. He also urges people to push for a more fundamental reengineering of the financing system so that people have a stake in it, ways to generate income from something other than just their labor. He explains why we need to start yesterday, citing current projections that by the year 2005, 60% of Americaâs purchasing power will be in the hands of our millionaires.

Acknowledgements