There are three words that define the new architecture of capitalism: monfortable, decempliant and povertimmune. Developed countries can become decempliant. Developing countries can become monfortable. Decempliant developed countries and monfortable developing countries can then have a povertimmune relationship that becomes the antidote against poverty in a new capitalist paradigm.
What does it mean to become decempliant and monfortable? Developed countries can become decem-compliant or decempliant. Firms and wealthy individuals in developed countries can also become decempliant. Decempliant describes the ability to become decem-compliant. Decem compliance is fulfilled if the decem policies are fulfilled. In order to fulfill its respective decem policy a country should raise ten percent of its GDP in debt and contribute to the poor's endowment that I call the Decemfund. A company should contribute to the Decemfund as well with a contribution equivalent to ten percent of its after-tax corporate earnings, a contribution that I call the decem tax. Finally an individual should invest ten percent of his or her wealth in excess of $10 million in the Decemfund.
A developing country will be monfortable if it agrees to receive the provision of global public goods through a new institution that I call The New Institution. The New Institution delivers healthcare, education, water and sanitation through an expanded microfinance network, getting rid of the middle man (the local administrations) and taking advantage of economies of scale. The developing countries that accept to become recipients of the delivery of such global public goods agree to participate in an ex-ante conditionality scheme.
The new relationship between decempliant countries and monfortable countries enables the construction of a new geographic space that is povertimmune. The povertimmune environment hedges developing countries against the threat of the pirates of heartless capitalism and the pitfalls of the six components of the Axis of feeble. Developing countries can start to sustain economic growth and prosperity away from the externalities that many experts have associated to the origination and perpetuation of poverty.
Decempliant and monfortable countries are signatory of new rules in the areas of agriculture and climate change, trade and labor rights, brain drain, financial architecture, extractive and mining industries, and small arms trade. The new rules guarantee that the monfortable developing countries are povertimmune and can grow away from the areas that originate and perpetuate the poverty trap.
Only decempliant countries will take advantage of a new economic space that offers a healthy and educated worforce able to reach a middle income status on the mid run. Decempliant companies will be able to operate in monfortable countries if they decide to enter during the window of opportunity that opens up in 2010 and closes in 2015. In the forty year span that begins in 2010 and ends in 2050, decempliant companies will operate according to a social business corporate model until the monfortable countries reach two benchmarks: a per-capita income of $5,000 and a Gini under 0.45. From that point onwards and until 2050 decempliant companies will be able to operate with a profit-maximizing corporate model to extract a profit out of those that once were extreme poor.
In the New Architecture of capitalism incentives of developed and developing countries are aligned, and corporations that invest on the long run will become the victors of a new, redefined loving capitalism. This is the New Architecture where short-term investors are discriminated from long-term investors. This is the New Architecture that penalizes the pirates of heartless capitalism.
Find more about Jaime Pozuelo-Monfort at http://Monfort.ORG