In Search of Social Capitalism 

Social capital is a form of economic and cultural capital in which social networks are central, transactions are marked by reciprocity, trust, and cooperation, and market agents produce goods and services not mainly for themselves, but for a common good. –  Wikipedia

Since the dawn of modernity, economic debate has centered on who owns the means of production. Capitalists argued private greed led to greater innovation and efficiency, while Socialists claimed state ownership was necessary to ensure the resulting gains were distributed equitably.

We believe in both ends, but disagree with both means. We propose reviving the term “Social Capitalism” to describe a system where private capital is voluntarily employed to benefit society, for which producers are entitled to receive a market-determined profit.The role of government is then primarily to ensure a level playing field, and hold actors accountable for their promises.

In a sense, Social Capitalism is a return to the moral philosophy of Adam Smith, Saint-Simon, and others who helped give birth to capitalism. It recognizes that human beings are both self-interested AND interested in the welfare of their fellow human beings. And that it requires careful systems design, hard work, and personal virtue – not merely an invisible hand – to keep the two in a healthy balance.

The term Social Capitalism also alludes to the fact that we are entering an era where social capital is becoming the most important resource. It can be thought of as a third economic stage, succeeding finance capitalism, which in turn succeeded what we could call “physical capitalism.” In pre-modernity, wealth was measured in physical terms: e.g., land and gold. Under finance capitalism, those still have enormous value, but are denominated in financial terms. Similarly, in developed countries wealth is largely valued for the social status, influence, and self-expression it enables, not just economic security (cf. conspicuous consumption).

Finally, we also believe that social capital is the best lens for analyzing the challenges of race, income inequality, and societal dysfunction. Communities with high social capital dramatically outperform those with less, even if they have similar financial circumstances. Social capital is thus both a leading indicator as well as the ultimate measure of the health of a community. Which implies we should shift our policies to create rather than supplant social capital, starting with prioritizing productive households and regional cooperation.

In the most polarizing election since the 1960s (if not the 1860s), there is a surprising consensus on both the Right and Left that our existing social contract is falling apart. We believe Social Capitalism may be exactly the medicine our body politic needs.

If you are intrigued enough to learn more, we invite you to join us for a conference call on Tuesday, November 15th at 9am PST. We are inviting thinkers and writers from across the political spectrum to see if we can forge a consensus around a new framing of societal and economic issues.

If you are interested, call or text us at +1 (408) 623-3809 or email centroids@RadicalCentrism.org. We hope you can join us!

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