The Gilded Age defies nostalgia. From roughly 1870 into the early 20th century, America spawned ostentatious opulence, income inequality, class immobility, grinding poverty, and the corporate monopolization of legal, economic, and political power.

By 1890, the top 1 percent of the U.S. population owned 51 percent of all wealth. The top 10 percent owned 86 percent. The lower 44 percent owned just 1.2 percent of total wealth. Burgeoning bribery and corruption intensified partisanship and polarization. Societal comity sickened.

This pathology spawned the progressive era symbolized by Theodore Roosevelt; two decades of reforms which helped relieve poverty; improved health, education, and working conditions; constrained corporate power; dismantled monopolies; and established the income tax. Yet it also protected capitalism from a more extreme reaction—because it persuaded ordinary Americans that democracy still worked.

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Today, it takes little imagination to see a new Gilded Age emerging. In 2018, Pulitzer Prize-winning business writer Steven Pearlstein wrote Can American Capitalism Survive, accompanied by a telling subtitle: “Why Greed Is Not Good, Opportunity Is Not Equal, And Fairness Won’t Make Us Poor.”

Now comes no less a capitalist than Michael Bloomberg. Addressing the new graduates of Harvard Business School, Bloomberg makes a visionary case for reforming capitalism:

Today, Americans are questioning whether those in the private sector—and in Washington—can provide the moral leadership our country needs, both economically and politically. They see the rewards of the economy increasingly concentrated at the top. They see wealthy parents scamming the college admissions process. They see families unable to afford healthcare and housing in the world’s richest country. They see decades of discrimination based on race and ethnicity trapping another generation into poverty. And they wonder: Is our economic system breaking down?

This distemper was not inevitable. The quarter-century after World War II featured an implicit corporate compact with society: fair wages, a secure retirement, proportionate executive compensation, vigorous unions, and curbs on the size and power of big business. Rising opportunity and diminishing income inequality followed.

Four decades ago, this balance began shifting. Faced with increasing global competition and a flattening stock market, CEOs began practicing a “shareholder capitalism” which prioritized investor returns. This often required using government to help achieve a radical transformation in how capitalism worked. This gave rise to a new corporate agenda rooted in spurring deregulation, reducing taxes, fighting unionization, slashing benefits, vitiating antitrust enforcement, pursuing corporate consolidation, transferring the workforce overseas or into nonunion jobs, and incentivizing CEOs for maximizing shareholder value—if necessary, by suppressing wages or firing workers.

The stock market rose; CEOs and Wall Street dealmakers became celebrities; corporations amassed economic and political power; American capitalism dominated the world economy. As distilled by Pearlstein, this sea change reflected three basic principles:

That government regulation and taxation prevented corporate America from competing;

That the sole purpose of public corporations was to optimize returns to investors;

That moral or societal concerns about income inequality, worker insecurity, and the maldistribution of wealth were antithetical to economic growth.

Writes Pearlstein: “[A]lmost everything people now find distasteful about [our economic system] can be traced to these three flawed ideas.” A crucial additive was the comforting mythology of supply-side economics: the promise that cutting taxes would pay for itself by spurring economic growth.

This neo-Randian theology transmuted our view of capitalism and free markets—eventually warping our social fabric, Pearlstein contends, while enshrining “a morally corrupting and self–defeating economic dogma which threatens the future of American capitalism.”

These dislocations were accelerated by macro-economic changes which gutted industrial and clerical work, rewarded automation, confined growth to technologically-skilled workers, and introduced the “gig economy.” Employment grew quickest in low-wage jobs. Mass employers such as Walmart paid non–supervisory workers a fraction of what General Motors had paid 50 years earlier—because they could.

Inevitably, corporate size became an economic and political problem. As private power swelled, so did economic concentration—in finance, the media, airlines, telecommunications, information platforms, and so on. Concurrently, corporations became “people” with the right to spend unlimited money to influence public policy – and therefore to insulate themselves from the consequences of democracy by aggressive lobbying and massive political spending. For many observers, this ratified the dictum of Louis Brandeis: “We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.”

Pearlstein spells out why. Nearly $7 billion went into influencing the results of the 2016 federal elections. The 100 largest donors in America contributed more than the 2 million smallest donors; a small network of billionaires organized by the Koch brothers can spend $900 million on a single election cycle. Corporations and industry associations expend another $3 billion a year on lobbying.

Corporate and financial institutions have installed a phalanx of politicians who do their bidding. Many Republicans in Congress are committed to protecting corporate interests and forwarding their agenda; increasingly, many Democratic candidates elevate liberalism on social issues over concern with concentrated power in corporate America, Wall Street and Silicon Valley.

This corporate and shareholder dominance, Pearlstein argues, feeds a general lowering of moral and ethical norms. Businesses too often show little concern for broader societal problems, such as climate change, healthcare, immigration, infrastructure, and education. This deterioration was exemplified by the financial crisis of 2008, when greed metastasized into a real estate bubble driven by financial manipulation and predatory lending.

In short, Pearlstein argues, capitalism as currently practiced erodes the basic trust and cohesion a healthy commonweal requires. Without that, civil society becomes uncivil; our politics “polarized, partisan and paranoid.”

This results in the dysfunctional governance exemplified first by the Tea party and later by the election of Donald Trump.

As corporate interests have gained more power and influence, they have presided over the diminution of the antitrust laws which once prevented private enterprises from becoming so large that they slip beyond control. In addition to stifling competition, limiting innovation, retarding new businesses, and concentrating corporate power over important marketplaces, large corporations began dictating the terms of existence for ordinary people—which often included further depressing wages and benefits.

Particularly notable are the big technology companies which have consolidated economic power instead of dispersing it. Take Facebook, that monopoly of the mind which enabled Russia to spread disinformation and exploit our social divisions; swallowed competitors and suppressed competition; leveraged its political power to forestall effective investigation and regulation; and traded our personal data in exchange for revenue or user data from others – privacy be damned.

In turn, small businesses are dramatically shrinking in numbers and market share. Moreover, starting a business has become much harder. Since 1980, the Atlantic reports, the number of new firms launched annually has declined by nearly two-thirds.

Another reason that the fruits of economic growth have become so narrowly shared is the political subjugation of labor. The New Deal sought to balance the power of workers and their employers. But over the last four decades the share of private sector workers who belong to unions has fallen to a level lower than it was before America legalized the right to organize and strike in 1935.

Forty years ago, 22 percent of the labor force was represented by private sector unions. Today, it’s 7 percent, and the overall number of unionized workers—private and public—have declined from 1-in-5 to 1-in-10.

A major cause is the proliferation of state right-to-work laws, which eviscerate worker bargaining power. No doubt some increases in wages and benefits, particularly in the public sector, had become unsustainable. But private sector unions spread prosperity without affecting public budgets. And the collective curative—destroying unionization—has fed underpayment and exploitation.

As Thomas Edsall notes, many conservatives believe unions hamper corporate America in global competition, while liberals often place the concerns of the educated urban professional class over those of blue-collar workers. This mutually reinforcing admixture of antagonism and indifference, Pearlstein argues, helps fuel a decline in worker morale and productivity as, rather than sharing profits, workers fear losing their jobs.

At the same time, white-collar criminals and predatory financial institutions have received de facto immunity from the law. Most conspicuous was the bacchanalia of wrongdoing by banks allowed to become “too big to fail,” which rewarded years of deregulation by producing the Great Recession—which, in turn, entitled banks to a government bailout at public expense. That may have been merely a down payment—already, lobbyists are chipping away at laws passed to prevent another such disaster.

But shareholder capitalism has its own internal pathology. The emphasis on shareholder value drives corporate buybacks intended to decrease the supply of publicly available shares, driving up price. This corporate obsession with satiating shareholders breeds a myopic focus on short-term quarterly results, stinting research and development, incentivizing splashy acquisitions, and reducing employees to disposable items of expense while inviting CEOs to gorge themselves on stock options.

Inevitably, shareholder capitalism drives one of our most corrosive economic ills—income inequality. Between 1953 and 1965, the inflation-adjusted income of the median family rose by 54 percent; between 2001 and 2016 it rose but 4 percent. In contrast, the last five decades the top 1 percent of Americans have nearly doubled their share of national income.

America’s top 10 percent now average more than nine times as much income as the bottom 90 percent; the top 1 percent average 39 times as much; the top 0.1 percent a stunning 188 times. The favorable tax rates for investment income further exacerbates the gap: 20 percent for long-term capital gains, as opposed to 37 percent for ordinary income in the upper brackets. As Pearlstein notes, this concentration of income equals that of the Roaring ’20s—the precursor to the Great Depression.

The result widens America’s yawning wealth gap. The richest 1 percent of Americans now hold more wealth than the bottom 95 percent; the net worth of the top 10 percent represents 70 percent of overall household wealth. The bottom 50 percent have virtually no net worth—the number actually approaches zero—and their share of our percentage of total wealth diminished by three-quarters in the last 30 years.

Thus the aggregate GDP no longer measures our overall economic well-being. America, Pearlstein writes, has wrought a “new Gilded Age where the benefits of economic growth are being distributed more unequally than any time since before the economic reforms of the Progressive Era and the New Deal.” Yet again, this is enhanced by ongoing changes in our tax code: cuts in the upper income tax rate, a lower capital gains rate, and slashes in the estate tax—all resulting from the outsized political influence of corporations and the affluent.

The ethos of shareholder capitalism drives a concomitant disparity in executive compensation. In 2017 Wall Street banks gave $31.4 billion in bonuses to their roughly 177,000 New York-based employees, more than two-and-a-half times the combined earnings of the 894,000 Americans who work full-time at the federal minimum wage. And this was on top of executive salaries averaging $422,500 a year.

The average CEO of the 350 largest public companies earns $15 million a year—271 times that of the average worker in those companies. That pay gap is nearly 9 times larger than it was in 1980. In short, Pearlstein notes, there is an arms race to overpay corporate executives in amounts far exceeding the growth in their firms’ sales, profits, or share prices.

Defenders argue that this reflects CEOs’ contributions to our economy. But that seems like a dubious claim. More likely, corporate structures have evolved to give CEOs the ability to shape their own governance boards and thus name their own salaries. These numbers are not, in any meaningful way, driven by the market. And they are surely not a reward for enhancing worker security or shouldering our common concerns.

At some point, this tectonic shift of income from labor to capital swallows its supposed benefits, creating much the same disincentives as classic Marxism. Nor, viewed rationally, does the last marginal dollar of income motivate true geniuses—a Bill Gates or Steve Jobs—to show up for work.

Here we return to Bloomberg’s commencement address:

If and when you wind up in an executive position, don’t make one of the fundamental mistakes I see businesses and boards make all the time: under-valuing your labor force—and overcompensating CEOs. Management often treats workers like widgets—which they are not. And boards treat CEOs like irreplaceable geniuses, which they rarely are. At Bloomberg, we pay employees very well, we invest in their training and education, and we offer industry-leading benefits. In return: Our employees pay us back ten-fold with their dedication and loyalty. And there is no better way to strengthen capitalism than to give people a greater stake in its success.

The tax cuts of 2017 further turbocharged economic inequities through an act of fiscal profligacy which ballooned our deficit for the benefit of corporations and the wealthy—justified, yet again, by resuscitating the discredited notion that under-taxing “wealth creators” stimulated the economy while paying for itself.

The bill distributed more than 80 percent of its individual benefits to the top 1 percent of households; the bulk of the $150 billion rebated to corporations in 2018 funded shareholder dividends and stock buy-backs—which amounted to little more than a gift to the 10 percent of Americans who own 84 percent of all stocks. This lopsided largesse was possible only through creating a $1.5 trillion deficit over the next 10 years, generating a brief economic sugar high, which is already dissipating.

Cumulatively, this 40-year stretch has over-corrected for the economic problems of the 1970s and helped stifle social mobility and create an increasingly impermeable class system. Increasingly, as Matthew Stewart documented in the Atlantic, the accident of birth plays an outsized role in determining economic success.

Because whatever our gifts, we do not rise solely our own merits. The top 10 percent are dealt very different hands than the bottom 90 percent: access to family wealth; quality daycare; early childhood education; healthcare; good schools and neighborhoods; college and graduate school; and, above all, social capital—the inherited ability to successfully navigate society by knowing who to call, where to go, and how to leverage your status to get ahead. These are the doctors, lawyers, executives, and dispensers of financial services who have a median net worth of $2.4 million – unimaginable for those below.

Thus the top 10 percent is becoming its own species. Privileged zip codes mean shorter commutes, higher life expectancy, stronger social networks, lower crime rates, and better public schools, while political influence enables residents to thwart housing programs which might provide upward mobility for others.

In this happy bubble, these contemporary patricians intermarry and are much more likely to form lasting families. Their ability to privilege their children is accelerating: lessons; camps; tutors; books; private schools. When it comes time for college, they often benefit from legacy admissions – a persistent form of elite affirmative action. While only 2 percent of American students graduate from nonsectarian private high schools, they comprise 26 percent of students at Harvard and 20 percent at Princeton. In a 2017 study, 38 top-tier colleges had more students from the top 1 percent than from the bottom 60 percent. In turn, access to elite education produces dramatically higher lifetime earnings.

Meanwhile, the middle class struggles and the poor suffer. Less-educated whites increasingly suffer death by class. Poor people die from suicide, substance abuse, or neglected health. Satisfaction with life is rising among the affluent, declining among those below. One obvious cause is the pervasive awareness of falling behind.

Given all this, more Americans feel more intensely that “capitalism” and “democracy,” as currently practiced, are inimical to their interests.

The cosmic failure of shareholder capitalism is that it eviscerates the belief that each generation will rise based on the workings of a market economy. The accompanying polarization and loss of communal sentiment further blights our future, increasing feelings of political irrelevance and civic indifference. And this cycle of alienation and pessimism is mutually reinforcing, separating younger generations from those who went before them.

The proponents of shareholder capitalism insist that these malignancies are the inescapable byproduct of a free market economy, which is the best way to grow the macro economy.But they are not the residue of some free market magic. They stem from deliberate policy choices lawmakers have made in the past, and which could be changed in the future.

These choices promoted one version of the “free market” by using government to serve certain corporate objectives, while eroding other communal—and sometimes corporate—concerns. There is so much rent-seeking at play that very few markets can properly be seen as “free” – the constellation of incentives we have now is really just one version of capitalism. There is no reason that we could not reorder incentives to create a version which better suits the current realities.

There has long been a pernicious myth that private markets, left unchecked, would eventually solve all problems. But this was always too simplistic a view.

A free market for widgets will, all things being equal, eventually deliver a pareto optimum for the production and sale of widgets. But not everything in the world is a widget. Markets cannot by themselves provide optimization for insurance, or common property, or primary education, or healthcare, or safety, or large-scale research and development that is in the public interest .Even for widgets, nothing is forever- sooner or later, monopolies and externalities distort markets.

The “free market” isn’t an end state. it’s a balancing act. And throughout American history we have constantly balanced and re-balanced. There is no reason we can’t make sound economic decisions, and revive our national spirit, by re-introducing shared values and aspirations to our practice of capitalism.

How do we define this ethos? Here’s Bloomberg again:

In Econ 101, you were probably taught that markets are based on supply and demand. But for capitalism to really function, people need to have faith that they will be entering into generally fair exchanges—that one side won’t cheat the other. Of course, not every person can be trusted to act with integrity, so we do have laws and regulations that are intended to guarantee it. These legal controls don’t always work, and periodically we do need to update them. For example, a century ago, Teddy Roosevelt took on the largest corporations that were destroying competition. Twenty-five years later, Franklin D Roosevelt’s New Deal provided relief from a Great Depression that some thought would lead to the downfall of capitalism. For their leadership, TR and FDR were reviled by many in the business world—and considered traitors to their class. But their actions preserved the integrity of markets—by restoring people’s faith in them. Now, I’m as much of a capitalist as you will ever find. But anyone who believes that unfettered capitalism works hasn’t read history. Today, we hear echoes of the challenges the Roosevelts faced. Industry consolidation has reached record levels and is suppressing competition and choice. More and more Americans—especially your generation—are questioning whether capitalism is capable of creating a just society. Their faith in America—and all that we represent—is being shaken. If we do not act to restore it, the turmoil in our politics today will be only a prelude of what’s to come, and that could shake the very foundations of our society. We cannot allow these issues to fester. We must address them now. We must find new ways to build a capitalist society that is more dynamic and more secure—more affluent and more equal—to restore faith in the promise of America and the future of the American dream.

This is not some alien collectivist transplant—Bloomberg’s vision of capitalism is rooted in American history. In honor of Theodore Roosevelt, we can call it by a phrase invoked by Joseph Stiglitz: Progressive capitalism.

The goal of progressive capitalism is restoring societal balance by recognizing that private enterprise is the core of a broadly successful economy, but that the ideology of supposedly-unfettered markets underpinning shareholder capitalism—abetted, in reality, by subjective public policy choices—is inefficient, destabilizing, and far from inevitable.

The credo of progressive capitalism rests on a few simple precepts:

That oppressive corporate power can be just as suffocating as oppressive government;

That properly understood, government should be a check on private excess, not its co-conspirator;

That, as Pearlstein notes, there is no single formula for distributing the fruits of prosperity, no abstract mechanism that compels it;

That secure and fairly-paid workers are not capitalism’s antagonists, but its customers;

That therefore, as Pearlstein concludes, “there is no ‘big trade-off’ between fairness and growth, between equality and efficiency. We don’t have to tolerate levels of inequality that offend our moral instincts for our economy to remain prosperous and competitive. If we want to have a bigger pie, it won’t hurt to divide the slices more evenly. In fact it is likely to make the supply even bigger.”

This philosophy acknowledges government’s role in protecting the environment; investing in infrastructure, technology, research and education; ensuring competition; preventing corporations from exploiting workers, and guarding against the undue influence of powerful institutions and individuals who believe that their sole societal mission is to liberate themselves from all legal constraints and moral considerations.

This isn’t sloppy social sentiment. Concern for the broader society provides a safe space for capitalism to thrive. Altruism and enlightened self-interest are allies, not enemies. A corporation can serve multiple purposes: rewarding investors; providing secure employment and retirement; developing new products; and paying taxes to the government which makes relatively frictionless commerce possible.

There are limits to what government alone can—or should—try to accomplish. But one must appreciate that the advocates of shareholder capitalism have appropriated government in a way that distorts society by further embedding inequality. The purpose of progressive capitalism should not be to foster endless dependence on an overweening government, but to enrich America by helping expand individual opportunity.

As George Will acknowledges in his latest book,

Everyone knows that all striving occurs in a social context and all attainments are, to some extent, enabled and conditioned by contexts that are shaped by government. . . . What is unfortunate is when the transmission of cognitive aptitudes and skills become so much a matter of the transmission of family advantages the child’s prospects can be largely predicted by information about his or her parents.

Precisely. We should be clear-eyed about the fact that there are disadvantages of both nature and nurture which can never be remediated. Yet progressive capitalism does not aspire to erase such disadvantages—how could it?—but to mitigate them where they have been artificially amplified.

The answer is not socialism, even in some aspirant form. Such a revolution would universalize the sclerosis of monolithic power—stultifying creativity, institutionalizing human error, and perpetuating the brain–dead insularity of a centralized economy. Rather, we must reanimate the hope and opportunity without which “freedom” and “democracy” become insipid slogans—the weapon of demagogues and the fertilizer of mass cynicism.

One principal avenue is programs which broaden opportunity by raising and spending money. In Pearlstein’s view, there is no way to advance social equity without providing more equality of income—a significant way of moving people closer to the same starting line. Here are some societal goals congruent with progressive capitalism:

Prioritizing K-12 education. Educating and training people for the new economy. Assuring college and student debt relief. Providing comprehensive care for children, support for working families, and access to universal healthcare.

Instituting a more progressive tax system. Constructing a social stronger safety net for Americans of all ages. Diminishing workplace discrimination.

Combating racial and economic segregation in housing while helping make more housing more affordable.. Rebuilding our infrastructure nationwide. Bringing economic development to stagnant regions and communities whose residents, quite often, cannot easily relocate.

Some measures will require public-private partnerships; others direct government expenditures. All necessitate nuanced and creative thought free from political litmus tests, pat formulae, or ideological rigidity.

Here are key examples:

Healthcare. Too many Americans are crushed by pre-existing conditions, catastrophic injury or sickness, and health problems exacerbated by their inability to afford preventive care.

Support for a single-payer system is becoming a virtual litmus test on the left. But enthusiasm diminishes once voters know the details. Polling shows that of the roughly 181 million Americans with employer-based health insurance, most like their coverage. While the estimated $33 trillion price tag for single-payer (over 10 years) might be offset by savings to individuals, those savings will not be equally distributed. Further, proponents lack details about how to pay for rising costs.

These concerns defeated single-payer proposals in Vermont, Colorado, and California. By contrast, there is broad sentiment for opening a public option which would enable Americans to access Medicare, while allowing others to maintain their private healthcare. One could look to Germany, which has a successful and affordable universal healthcare system which incorporates strictly-regulated insurance companies.

Finally, we can lower the cost of prescription drugs by negotiating prices under Medicare, importing cheaper drugs from Canada, or allowing the government to manufacture generic drugs when the marketplace fails.

The point is this: flexibility matters. Proponents should not squander opportunity through internecine warfare.

Childcare. The average cost of childcare can range from 9 percent to 36 percent of family income. It’s often low-quality and depends on ill-paid workers. It eats up second incomes, discourages couples from having children, and can drive families closer to poverty. This is a serious issue for millions of Americans.

Elizabeth Warren’s plan for universal childcare is interesting and ambitious. But it does not address families who want to keep one parent home (perhaps to care for an infant or very young children). If anything, it incentivized both parents to work regardless of what parenting model they prefer, and cuts against her view that two-income family structures can operate as a trap for the middle-class.)

The alternative is specific and targeted provisions to help relieve families. One option is expanding the Child Tax Credit. Another is expanding the Earned Income Tax Credit, which would help all families, including those with stay-at-home parents. Finally there is universal paid leave, which would relieve young couples from choosing between paychecks and parenthood.

Again, the paramount need is for a practical and achievable program which benefits families and society writ large.

Education. Another societal weakness is a lack of access to education at every level which limits the potential of young people to raise their sights and strengthen our society. Progressive capitalism should recast education as an investment in building a ladder of opportunity for all.

Start with universal pre-k education for every child, strengthening our public elementary and secondary education, and providing vocational training for young people who want to enter the new economy without attending college.

Still, a recent congressional report estimates the two of every three jobs are filled by people with at least some college education. Yet only 9 percent of people in the lowest income quartile graduate from college by age 24, as opposed to 77 percent in the top quartile.

One needn’t embrace a “free college for all” program which asks taxpayers to educate the wealthy. A good start would be providing two years of free community college, and making four year colleges and graduate school affordable by expanding Pell Grants, reducing student loan rates, and providing student debt relief – the better to make tuition, room and board manageable and greatly expand America’s talent pool.

Infrastructure. The need is immediate. In 2017, the American Society of Civil Engineers gave our airports, bridges, dams, water systems, grids, ports, railways, roads, and public transit a collective D+. The society estimated that $4.6 trillion in spending was needed to reverse this state of affairs and that within 10 years, failing infrastructure would cost our economy almost 2.5 million jobs and $4 trillion.would cost our economy almost $4 trillion and 2.5 million jobs.

McKinsey estimates that every well–spent infrastructure dollar would raise GDP by $0.20. But systemic, political, and fiscal stagnation have bred paralysis. One reason is an overemphasis on public-private partnerships, which would only fund projects which generate revenues to repay private investors. What’s required is that to which Trump pays lip service: public expenditures sufficient to overhaul infrastructure and strengthen our marketplace.

Climate change. The scientific consensus is clear: within the lifetimes of most people on earth, will see more intense droughts, food and water shortages, increasing risks to human health, climate related poverty, conflicts over water, rising seas, and a quickening progression in global temperatures. By 2050, much of our world could be dangerously inhospitable – even uninhabitable – for coming generations.

America should enact a carbon tax—the centerpiece of most serious proposals to combat climate change—while channeling its benefits to affected workers. Other measures could be packaged with an infrastructure and jobs program: retrofitting buildings, retooling public transportation, and building a green energy system.

The government should fund research into clean energy solutions, impose federal standards on appliances to reduce energy waste, and prod automakers to produce to more fuel–efficient vehicles while transitioning toward electric cars. Finally, a comprehensive program should consider using carefully-monitored nuclear energy to accelerate the transition from fossil fuels

Tax reform. We should adjust our tax laws to close the deficit, fund environmental protection and programs which bring more Americans into our economic mainstream, and undo the rate reductions which have fueled inequality.

Two broadly popular ideas are Warren’s “wealth tax” on fortunes over $50 million, and Alexandria Ocasio-Cortez’ proposal for a marginal income tax rate of 70 percent on incomes above $10 million—replicating the marginal rates of the broadly prosperous Eisenhower years. But these raise questions of political practicability and, regarding the wealth tax, collectability.

Less dramatic but efficacious are raising marginal income tax rates to those of the Clinton era; increasing the corporate tax rate; raising the estate tax; taxing capital gains as ordinary income; repealing Trump’s tax cuts; eliminating the carried-interest loophole; and closing individual and corporate tax shelters. Unless we want to perpetuate deficits and social volatility alike, we must reform our tax code.

But progressive capitalism also requires pre-tax reforms. As Pearlstein notes, there are political and economic limits to how much income can be redistributed by taxing and spending. Stressing pre-distribution—altering economic incentives and how incomes are set before taxes—is essential to progressive capitalism.

This means protecting workers against low wages, curbs on collective bargaining, cuts in worker compensation, and mandatory arbitration and non-compete clauses in employment contracts, while making it easier for unions to organize and exercise the right to strike.

It means protecting the public from consumer fraud and financial predation—including the vigorous prosecution of white-collar crime.

It also means incentivizing corporations to balance the interests of shareholders with those of consumers, customers, employees, and their community. To this end, Warren proposes that large corporations obtain a charter of corporate citizenship which codifies these obligations; that employees select 40 percent of board members; that 75 percent of shareholders and directors approve corporate political activities; and that executives hold shares they receive as compensation for at least five years.

Further, she would encourage environmental accountability by mandating corporations to disclose her greenhouse gas emissions; their ownership of fossil fuel related assets; and their strategy for ameliorating the physical and economic risks posed by climate change. All of which costs taxpayers nothing.

Critically, progressive capitalism means deploying antitrust law to loosen the stranglehold of large corporations on our economy; scrutinize mergers and acquisitions; and, in cases such as Amazon and Facebook, break up unconstrained corporate behemoths. For free markets to work they must, in fact, be free.

Antitrust expert Tim Wu calculates that since 1997 U.S. public markets have lost more than half of their publicly traded firms. As Jonathan Tepper writes, “capitalism without competition is not capitalism.”

This, too, reflects our history. Richard Hofstadter once wrote of the antitrust movement of the Progressive Era: “Nothing less was at stake than . . . the very question of who is to control the country.” Similarly, the trustbusters of the New Deal recognized that monopolies and cartels had helped bring the authoritarian regimes of Germany and Japan to power.

Our current interpretation of antitrust laws—focused solely on the power to raise prices—is too narrow. This reading ignores that a truly free market is competitive, encourages innovation, and resists the agglomeration of economic dominance—that which allows companies to buy or kill off competitors, swallow emerging firms whose technologies could threaten their position, lower prices to drive startups from the marketplace, and use “vertical” mergers to acquire customers or suppliers, placing their competitors at a grave disadvantage.

Collectively, Amazon, Facebook, Google, Apple, and Microsoft have purchased 436 companies and startups in the past decade, with no meaningful regulatory challenge. Progressive capitalism would curb these practices.

This undue corporate influence mandates the last, indispensable element of progressive capitalism: preventing special interests from corrupting our democracy.

Democracy is about more than holding elections. It requires that no one accumulates the power to substantially influence those elections—whether through a campaign finance system which is an elegant form of bribery; lobbying leveraged by promises of financial support; inducing appointed officials to serve private interests; or exploiting those who commingle governance with personal gain.

The FEC can be strengthened and individual super PACs shut down. Legislators can prohibit U.S.-based corporations owned by foreign nationals from making campaign contributions or expenditures. And then there is sunlight: Our election laws should require comprehensive disclosure of all campaign funding and its sources, as well as create a public campaign-finance matching system for candidates who raise money from small donors.

Finally, we should cut the corrupt nexus between corporate lobbyists and public officials, including barring specified officials from owning individual stocks or later pursuing lobbying careers; requiring the president and vice president to place assets which raise potential conflicts of interest in a blind trust; compelling them to release their tax returns; preventing direct political donations from lobbyists to legislators; forcing lobbyists to disclose the interests they represent and their meetings with public officials; and creating an independent agency to investigate ethics violations.

In sum, progressive capitalism recognizes that economic and political health are inextricably intertwined. Our contemporary problem is not capitalism per se, but the size and reach of massive private institutions.

Allowing them to accrue unchecked dominance ultimately narrows opportunity, constrains competition, retards economic vigor, and undermines representative governance. True democracy, the past tells us, can only flourish when power and prosperity are more equitably distributed.

To some, this may sound radical. So did the New Deal. That wasn’t; this isn’t. Rather, progressive capitalism seeks to preserve our political and economic system against extremism, instability, stagnation, alienation, and strife.

The poisoned fruits of fusing corporate and political power include those which darkened so much of the 20th century—oligarchy, fascism, authoritarianism, and blood-and-soil nationalism. And it risks squandering the immense good that capitalism can provide when it is functioning at its best by spawning mass disenchantment. Already millennials express an increasing openness to socialism—which should be a sobering verdict on capitalism as they’ve experienced it.

We stand at a societal crossroads. Adjures Michael Bloomberg:

Elect people who understand that it’s their obligation to make capitalism work for everyone, and not be so naïve to think other systems will be better. That means picking up where Teddy and Franklin Roosevelt left off and modernizing capitalism for our time. America must always be a place where it’s possible to get rich through perspiration and inspiration. But it must never be a place where the middle class steadily loses ground—and where many of those at the bottom feel trapped. Unfortunately, that is the path we are on now. And the further down that path we go, the more likely that the most extreme voices on both the left and right will attract large followings, win power, and do real harm to our country.

That’s the fate progressive capitalism would spare us. If history teaches us anything, it’s this: In the end, no society does better—politically, economically, or spiritually—when most of its people do worse.