Capitalism is not Corporatism

IREF ^ | Ram Mudambi, Samuele Murtinu

[CondoleezzaProtege]

What are these ills that are laid at the door of capitalism? Just a short list includes: business monopolies that jack up prices and prey on captive consumers; laws favoring vested industry interests passed through lobbying, often in backroom insider deals; barriers to entry to squelch small competitors; fatcat executives without accountability to shareholders and multi-million-dollar payouts; systemic crises created by financial or corporate scandals; and the list goes on…

But none of these ills is an attribute of capitalism – in fact, in a truly capitalistic system every one of these ills would disappear. These ills are the outcome of what Eisenhower long ago called “the military-industrial complex”.

And there is a name for this system – corporatism.

Corporatism is capitalism’s evil twin – identical in its external form, but the polar opposite in its internal beliefs and underlying principles.

There is one fundamental principle that illustrates this black-and-white distinction. The core tenet of capitalism is “free markets and free entry”. This has been true at least since Adam Smith’s famous first exposition of the “invisible hand” in The Wealth of Nations way back in 1776.

Corporatism, on the other hand, draws its inspiration from the Keynesian welfare systems, Fordist industrial organization, and the intricate networks of organized interest representation and industrial relations systems, with large firms having quasi-public status and being key actors in macro policy decisions.

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TOPICS: Business/Economy; Reference
KEYWORDS: adamsmith; capitalism; communistprotege; corporatism; corruption; economics; eisenhower; keynes; keynesian; randspam; takeoutthetrash; tds

[CondoleezzaProtege]

What we have right now in American is corporatism. The uniparty in Washington oversees it. Trump failed in his mandate to address it. And the midterms were a multipartisan backlash.

[dfwgator]

Corporatism

Profits are privatized
Losses are socialized

[dfwgator]

Abdul El-Sayed, the Michigan Democratic Senate nominee, has cited Adam Smith to explain his economic worldview and defend his identity as a capitalist rather than a socialist.

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This guy is slick, and underestimate him at your peril.

[equaviator]

Corporatism involves corporate culture and how much of it is popular, I have no idea.

Right around 2012, 2013, I came to the realization that I still like the work I do in my chosen profession but that I had grown to dislike the business. Gee, I wonder why!

[No name given]

Sad but true.

[Engraved-on-His-hands]

“Woe to those who lie upon beds of ivory,
and stretch themselves upon their couches,
and eat lambs from the flock,
and calves from the midst of the stall;
who sing idle songs to the sound of the harp,
and like David invent for themselves instruments of music;
who drink wine in bowls,
and anoint themselves with the finest oils,
but are not grieved over the ruin of Joseph!
Therefore they shall now be the first of those to go into
exile, and the revelry of those who stretch themselves shall pass away.”
(Amos 6:4-7)

[Bratch]

Trump The Republican Congress failed in his their mandate to address it. And the midterms were a multi-partisan backlash.

Fixed.

[Dr. Sivana]

I prefer not to employ the term “capitalism”, as it emphasizes the central role of capital.

To me, the essential feature of the character of our financial system is “Free Enterprise”.

Adam Smith certainly did not and would not use or identify with the term “capitalism”.

[CondoleezzaProtege]

I think Ron Paul types suggest the same. Regardless, until the GOP expresses the same instinctual aversion to those who ooze corruption and pay to play scheming like the Ken Paxtons and Mike Rogers of the world…If those are the candidates the GOP continues to put forth, electoral defeat will continue to be the rule.

[dfwgator]

And now you have Democrats, like El-Sayed, claiming they are fans of Adam Smith.