The problem with that hope is that it ignores how innovation happens. There is no reclusive mad scientist working in some dank basement on the next-best-great-thing. That's childish.
Innovation happens through collaboration. You take someone else's work and you build upon it. Bit by bit, people build the next-best-thing.That's a very interesting point(s). Again, arguing from a devil's advocate POV. People who are generally against software patents commonly make the claim that it stifles the innovation of the single person, sitting in the their dank basement working on the next-best-great-thing (see other comments in this topic for examples, including a rather brilliant quote by Carmack).
In terms of collaboration, sure, patentable ideas/software often exist due to collaborative team efforts, just like patentable physical widgets like industrial egg fryers. But that team is generally paid for by one company and the patent is then assigned to that company.
There really appears to be a few major issues that I see with the present system:
1) Patents are transferable
2) Patents aren't researched enough against prior art before reward
3) Patent length is too long
4) Fighting bad patents is expensive and overly hard, even when armed with tons of prior art
5) Patents don't necessarily need an extant physical or implemented example to be granted.
6) Patents can be granted without the intention of implementation.
I think for real patent reform to work, these 6 points need to be addressed to keep the concept of patents (risk in exchange for exclusivity) a workable model:
1) Patents shouldn't be transferable -- this eliminates patent trolls
2) The Patent Office needs to be properly funded and given enough time to properly research patents before grant.
3) Patents (like copyright) needs to be shorter and dependent on the effort required to create the patent in the first place. For example, software patents should probably only survive 12-18 months. That gives the owner a risk/exclusivity that's long enough and if the idea proves valuable, opens it up for others to use (and improve the economy as a whole) within a reasonable time. In other words, this recognizes that risk doesn't just end at the grant of a patent. Actually doing something with the patent is important.
4) Appealing bad patents should be relatively simple and swift.
5) You should actually be able to demonstrate something that's patented.
6) If you don't use the patent in a business use-case, you lose it. A bit like Trademark.
Just some random ideas.