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Ron Paul makes a very valid point about differentiating between capitalism, and what is described here, which he calls corporatism (somewhat at odds with the de
by mseebach 16y ago
Ron Paul makes a very valid point about differentiating between capitalism, and what is described here, which he calls corporatism (somewhat at odds with the definition for this term offered in Wikipedia).
- steveklabnik 16y agoThe real question is, does capitalism just inevitably end up in coporatism?
- mseebach 16y agoIf that is indeed the question, it should be if capitalism and democracy doesn't naturally end up in corporatism. There's an unfair amount of blame on the corporate end of this conflict, when the fact is that nothing of this could happen without willing politicians.
- m0th87 16y agoAntitrust law provides some interesting insight into the question IMO. It was established because laissez faire economics failed to prevent monopolies. Instead, a carefully crafted regulation supported capitalism. I think true capitalism can't arise in a vacuum; it needs a regulatory support structure for enforcement.
- mseebach 16y agoIt's well agreed that at least property rights and strong rule of law are prerequisites for capitalism. Most anarcho-capitalist discussions I've heard seems to evolve around how exactly those two properties would come to exist in a state-less society.
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- xenophanes 16y agoYes but that rule of law wouldn't have any anti-trust laws in it, right? So I'm not sure how this is an answer to the claim that capitalism creates monopolies so anti-trust laws are needed. As an anarcho-capitalist, I think we need to convince people that capitalism doesn't cause problematic monopolies, Governments cause those.
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- kiba 16y agoAnd I heard economists saying anti-trust laws are a joke that usually hurt smaller business over large. Who watch the watcher? How those watcher of watchers determine if the watcher in question is doing its job?
- CPops 16y ago"Antitrust law provides some interesting insight into the question IMO. It was established because laissez faire economics failed to prevent monopolies." This is obviously false, both from a logical and historical view. A monopoly cannot exist in a free market as no company, no matter how successful, can actually restrict entry into any given market without the government banning entry into that market. This is accomplished though various legal means including licenses, trade barriers, so-called "intellectual property" protections, and other tactics. Without the barriers for entry into any market provided by government, establishment of a monopoly on any desired service would be impossible. Now, you might cite some historical examples like Standard Oil and the like as examples of why monopoly protections are needed, but this standard example only illustrates my case. The price of a gallon of oil, for example, was around 30 cents in 1870 and fell to around 6 cents at the time of the anti-trust trial. And their market share was continuously dropping despite their supposed monopoly.
- OpieCunningham 16y agoNot sure why you were down voted on that. You're correct in my view that laissez faire economics doesn't promote monopolies. There are other reasons laissez faire economics is a poor economic model, such as safety.
- m_myers 16y agoI would argue that safety regulations are not at odds with the laissez-faire model. Laissez-faire is not the same as anarchy; injuring another person -- including through faulty products or workplace hazards -- should still be punishable.
- fexl 16y agoAlso, on the subject of safety in the free market, think Underwriters Laboratory and Consumer Reports. People don't want coffee makers that burst into flames or cars that roll over.
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- xenophanes 16y agoYou're rewriting history. Take the railroads. Railroads that were working with the government made transcontinental tracks first. The first private one came after. Laissez faire economics didn't get there first and create a bunch of monopolies, they came by and large from corrupt politicians being bribed to pass laws to support them. (Politicians were really corrupt back then. For example they would commonly threaten to pass nasty laws to mess up railroads just to get bribed to stop. It's amazing how bad it was, and how far we've come that today's politicians aren't so corrupt like that (partly the change is due to technology making it harder to hide what you do)).
- frossie 16y agoI think true capitalism can't arise in a vacuum; it needs a regulatory support structure for enforcement. cf. The Value of Nothing by Raj Patel in which he makes the point that we all agree as a society how trade is conducted, and we can agree to do it one way or another way. For example we now agree humans can't be sold and that land can, but at other times the reverse was the case. Trade does not happen in a social vacuum.
- te_platt 16y agoNo, human nature inevitably leads to corporatism. Let me give my definition of capitalism and corporatism to start my argument. Capitalism: People are free to buy and sell their own property as they see fit. This necessarily implies people have enforced property rights. In other words people with economic freedom are practicing capitalism. Corporatism: Groups of people organize (into corporations) in order to advance their interests (usually to make a profit). One way to advance their interests is to push for laws and regulations that favor themselves at the expense of others. So in the United States we have a constitution designed to protect freedom from people who are trying to favor their own interests. Now we're all involved in both sides to some degree or another. I want freedom to do whatever I want. I also want restrictions on your freedom to do whatever you want to do to me. Where do we end up? Well we never end up anywhere, we just keep changing what the limits of our freedoms are. Human nature being what it is, given the opportunity we push for personal benefits at the expense of others freedoms - Corporatism.
- joubert 16y agoI could find neither his name, nor an explanation of the distinction that you mention he makes, in this article. What is his argument?
- steveklabnik 16y agoIt's not in the article. See http://en.wikipedia.org/wiki/Corporatism#U.S._corporatism http://en.wikipedia.org/wiki/Corporatism#U.S._corporatism , which others would call http://en.wikipedia.org/wiki/Corporate_capitalism http://en.wikipedia.org/wiki/Corporate_capitalism , which others would call http://en.wikipedia.org/wiki/Corporatism#Fascist_corporatism http://en.wikipedia.org/wiki/Corporatism#Fascist_corporatism
- joubert 16y agoI know what the difference is between Corporatism and Capitalism, but I would be intrigued to see Ron Paul's explanation of the distinction and relationship, and, in particular, how his specific policies would prevent corporatism.
- steveklabnik 16y agoAh, okay. I haven't heard anything too specific other than him saying "Corporate Capitalism sucks, and we shouldn't do it." I just tried poking around on The Google, and http://www.ronpaul.com/tag/corporatism/ http://www.ronpaul.com/tag/corporatism/ is apparently 500ing right now.
- mseebach 16y agoSocialism is a system where the government directly owns and manages businesses. Corporatism is a system where businesses are nominally in private hands, but are in fact controlled by the government. In a corporatist state, government officials often act in collusion with their favored business interests to design polices that give those interests a monopoly position, to the detriment of both competitors and consumers. Source: http://www.campaignforliberty.com/article.php?view=806 http://www.campaignforliberty.com/article.php?view=806
- metageek 16y agoI'm not sure you can make that distinction. Capitalism is using capital to get economic power. The kind of practices described here are exactly that.
- fexl 16y agoNo, the article describes the practice of acquiring political power, not economic power.
- yequalsx 16y agoWell, the distinction is essentially meaningless in a 'free market' society. There are some politicians who are in it to help others but many succumb to the economic motivations present in our current political system. Powerful lawmakers can parley their political power into economic gain and given the number of rich people in Congress and the amount of lobbying money spent it appears the reverse is true as well.
- jimmyk 16y agoIn a free market society, there would be no such thing as a powerful lawmaker. By saying that many politicians are incapable of resisting corruption, you are making an argument for severely limiting the power of the government.
- yequalsx 16y agoNo, I am making no such argument. What needs to change, in my opinion, is our culture. Many politicians in our current political system with our current culture are incapable of resisting corruption. Severely limiting the power of government would just let corporations run roughshod over us even more than they do now.
- jimmyk 16y ago>Severely limiting the power of government would just let corporations run roughshod over us even more than they do now. I disagree, and offer this article as a source of several examples. The corporations currently have far more influence over the actions of the government than the general public, which means that corporations are able to exercise a lot of effective power over the general public. By removing some government power, you lessen the effective power of corporations. If the government is stripped of its power to do things like shutting down small coffin makers or imposing high tariffs on specific markets, corporations lose their ability to influence the government into doing those things. I defy you to show me any examples other than Microsoft of a corporation gaining so much economic power that, without employing the government, it was able to exercise more power than the government currently enables it to.