Back in October, Mitch Kapor did an audio interview with William Greider about his book, "The Soul of Capitalism: Opening Paths to a Moral Economy" (discussion forum here). It's taken a while to get the book from the library, make my way through it, and post this review.

Greider is in search of a way to reinvent capitalism so that it accomplishes social purposes as well. Here are some quotes that stuck out to me:

p. 84

1. the natural rights of people are inescapably violated by the enduring master-servant relationship
2. universal ownership (...) is not only more just, but is necessary to prevent an eventual economic and political crisis for the present system
3. businesses perform better when employees share a stake in the ownership

Having owned my own business for a while, I'd have to agree with these points.

p. 159

usufruct - "take what you need, leave the rest for others"

This speaks to me about the notions of a commons, one of my favorite topics, and related to innovation, which appears below

p. 205

The corporation's legally privileged structure and unbounded scale generate a different kind of corruption -- the irresponsibility of concentrated, self-aggrandizing power. The commanding heights of corporate control belong to management insiders, and the large-bloc share owners who together are able to impose a narrow-gauged understanding of economic purpose on their own organizations and on the larger society. Given this closely held power, a successful company may remain oblivious to social injuries or the country's neglected priorities, but may also be blind to the corporation's essential purpose: creating real wealth for the future, the material gains that sustain a civilized society.

Greider re-images the corporation as a positive social force.

p. 228

The corporation may be thought of as a kind of protected cloister for sustained economic development, the place people gather to collaborate in complex, long-running processes of innovation and production

I like the focus on innovation.

p. 232

The essence of the successful corporation, as O'Sullivan explains in a telling phrase, is its function as a "learning collectivity". Only through continuous, collective learning among participants and managers is the company able to innovate, to discover new insights about itself and its objectives. And only innovation gives it the ability to survive and flourish; that is, to produce genuinely new value that can compete with others trying to do the same. Innovation, in these terms, simply consists of discovering new methods or products that deliver greater quality or cost savings or advanced capabilities over what existed before.

Innovation requires learning. I like it.

p. 233

This quality -- the capacity for innovation -- ought to be the first, most important social test of corporate governance. Regardless of how the firm is organized, does its organizational control system inspire innovation or suppress it? Do the "strategists" commit capital to innovative priorities because they are steadily informed by the "learners" scattered throughout the company?

p. 235

In sum, if O'Sullivan's "learning collectivity" becomes the standard by which corporations are judged, then the system for corporate governance has to be refocused on a different set of values, with more intrusive questions, but also more human-scale content.

p. 239

(Charles) Perrow's "Organizing America : Wealth, Power, and the Origins of Corporate Capitalism" (Charles Perrow) larger point is that the corporation is a social organization itself.

The "learning collectivity" is further threatened by the question of scale. ... When a corporation becomes a conglomerate of many unrelated businesses, the collective learning process becomes so tenuous it often disappears.

In other words, bigger is not always better.

p. 242

For the long term, imagine that antitrust law is transformed into a broader, more effective legal doctrine called "social trust". This new approach would start by reestablishing the original presumption that very large business organizations are inherently suspect - not good for us - because their concentrated power undermines democratic society as well as the learning-and-innovating capacities of the economy.

p. 243

But one of the most troubling failures of the existing corporate governance system is that a "white hat" company can morph into a "black hat" without disturbing its bylaws or legal obligations.

This definitely troubles me.

p. 258

I identify six essential social purposes that, contrary to conventional dogma of American capitalism, are not inherently incompatible with successful enterprise and, in fact, should reinforce a profitable, innovative corporation. These qualities have largely been excluded from the standard corporation by design or popular default to the existing power alignments. Think of these as six key steps towards establishing self-enforcement within a responsible business organization.

1. The Corporation must produce real new wealth, profit in the narrow meaning but also genuine value added to the material basis for sustaining a civilized society

2. The active objective of the corporation is to achieve harmony with nature, instead of borrowing assets from the future, with the understanding that disturbing nature is inescapable, but destroying it is neither required nor free

3. The system of internal governance reflects a democratic understanding that one way or another all of the company's insiders "own" it and together accept the risks and responsibilities for its behavior, and that the governance mechanisms ensure participatory decision making and the equitable adjudication of inevitable differences.

4. The corporation, in addition to its standard obligations to investors or creditors, undertakes concrete covenants with the communities that also support it in different ways (perhaps even granting forfeitable performance bonds that will serve as formal instruments of mutual obligation and trust)

5. The company's mission includes promoting unbounded horizons for every individual within it, whatever their personal potential and ambitions might be.

6. The corporation commits to defending the bedrock institutions of the society, from the viability of family life to the integrity of representative democracy

These purposes aren't perfect, but they seem a lot better than most of what is out there today.