I'm currently wading through George Gilder's new book, "Knowledge and Power."

Why? It's got some good thinking on the new economy that's emerging.
- In it, he makes the case that wealth is a function of how much innovation (knowledge production) occurs in an economic system.
- Further, he makes the claim (as I do) that the system that produces the most novelty (fortuitous mistakes) is the one that wins over the long term.
- The spontaneous emergence of this innovation engine is the reason we live better today than we did 500 years ago.
However, George makes an eggregious mistake. Simply, George claims that this "innovation engine" and "Capitalism" are the same thing.
It's not.
Capitalism is simply an organizational framework that uses market mechanisms for information discovery and (scarce) resource allocation. Bureaucracy is another orgnizational framework does the same thing, but in a different way.
We've been using capitalist markets and bureaucratic hierarchy for thousands of years. Long before this innovation engine ignited and launched us into the modern world. That implies this engine is new. Something that is of a different form/character than the markets/heirarchy we currently use to move the engine forward.
We've needed both in the past. For example, we've used markets for allocating resources to innovators (entrepreneurs) and hiearchy for inching science ahead.
However, this is where I go off the reservation a bit.
I think it's possible to do better than what we've done in the past. To innovate MUCH faster (hundreds of times faster) than we've done to date. To do that, we need to think in terms of new organizational frameworks. Beyond markets and bureaucracy.
Remember, the innovation system that's moving us forward merely used markets and bureaucracy because they were the most advanced organization forms we had available at the time. They aren't anymore. The global network we currently live in, enables us to create new methods of interaction that have the potential to make markets/bureaucracy look clumsy and slow witted in comparison.