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I’ve seen another user on HN who grew up in the USSR call it “soviet capitalism”. A friend of mine also recognized it in this 2015 article (see footnote 1): ht

I’ve seen another user on HN who grew up in the USSR call it “soviet capitalism”. A friend of mine also recognized it in this 2015 article (see footnote 1): https://reasonandliberty.com/articles/obamacare https://reasonandliberty.com/articles/obamacare

wpietri 7y ago
That's a good description. I'll also talk about "corporate feudalism", where you have the Duke of Engineering fighting with the Duke of Product, and the King/CEO must mediate the conflicts. The peasants, of course, are basically property of their various nobles. But I really like "soviet capitalism", as it points at a key contradiction. Somehow, fans of capitalism, which maximizes surplus value by freeing individuals to make economically rational choices, rarely seem to notice that large corporations never make use of the mechanisms of capitalism, instead relying on central planning. And like the soviet era, corporate central planners often do things that are economically irrational, but useful to their careers and their quality of life.
- wbl 7y ago
  Theory of the Firm is a huge topic in microeconomics.
- chapium 7y ago
  At the end of the day, everything is a tree.
  - wpietri 7y ago
    Nah. Humans, who evolved in dominance hierarchies, are very inclined to see everything as a tree.
- dasil003 7y ago
  I don't understand the contradiction you're getting at. The way capitalism works is that individuals are free to pursue their own interests. The way a corporation works is that they pay you a salary in order to pursue their interests. There's plenty of delegation happening in corporations, but ultimately there has to be some accountability controls since you are acting as an agent. What mechanism do you propose for leveraging individual incentives while still recognizing ownership of the corporation?
  - wpietri 7y ago
    You really can't see the contradiction? I'll try again: Many fans of capitalism believe it superior to communism because free markets and high individual initiative produce better outcomes than central planning. However, they also believe in the awesomeness of corporations, which are generally run with central planning and no individual initiative. Is that clearer?
    - dennis_jeeves 7y ago
      >Many fans of capitalism believe it superior to communism because free markets and high individual initiative produce better outcomes than central planning. You are incorrect, when you start getting into nuances. When you have the govt doing central planning, there is no way to get rid of them when they under perform. When people voluntarily form central planning organizational structures, they are eliminated by the free market if they under perform. The difference between communism/capitalism is fundamentally of philosophy not of structure. In the former it's coerced co-operation (which almost always results in central planning) and the in the latter it is voluntary co-operation( there will be many organizational structures and some may have a central planning) How old are you? (no I didn't make a mistake when I asked you that question)
      - Talanes 7y ago
        >When you have the govt doing central planning, there is no way to get rid of them when they under perform. All Democratic governments include a way to do exactly that - by definition. There's room for debate over how effective it actually is at removing underperformers compared to the free market, but saying it has no way to get rid of them is just untrue.
        antepodius 7y ago
        Is there? How often does the american federal government shrink? How would it shrink, if it turned out that it was too big? In a democratic government, you're not electing the central planners. In the american government, you're not electing any of the millions of three-letter agencies that rule your life. You hire a president, and he may or may not do something, who knows. At least a market has some contact with a ground truth of bankruptcy. If there were several competing EPA's competing for money on the basis of their efficacy, that might be interesting.
mattrp 7y ago
That’s a great term for it. It’s maddening to see it in the enterprise and just downright depressing when it creeps into a startup - like why do you think you’re here? To give enterprise vendors half your ebitda?

wpietri 7y ago

That's a good description. I'll also talk about "corporate feudalism", where you have the Duke of Engineering fighting with the Duke of Product, and the King/CEO must mediate the conflicts. The peasants, of course, are basically property of their various nobles. But I really like "soviet capitalism", as it points at a key contradiction. Somehow, fans of capitalism, which maximizes surplus value by freeing individuals to make economically rational choices, rarely seem to notice that large corporations never make use of the mechanisms of capitalism, instead relying on central planning. And like the soviet era, corporate central planners often do things that are economically irrational, but useful to their careers and their quality of life.

wbl 7y ago
Theory of the Firm is a huge topic in microeconomics.
chapium 7y ago
At the end of the day, everything is a tree.
- wpietri 7y ago
  Nah. Humans, who evolved in dominance hierarchies, are very inclined to see everything as a tree.
dasil003 7y ago
I don't understand the contradiction you're getting at. The way capitalism works is that individuals are free to pursue their own interests. The way a corporation works is that they pay you a salary in order to pursue their interests. There's plenty of delegation happening in corporations, but ultimately there has to be some accountability controls since you are acting as an agent. What mechanism do you propose for leveraging individual incentives while still recognizing ownership of the corporation?
- wpietri 7y ago
  You really can't see the contradiction? I'll try again: Many fans of capitalism believe it superior to communism because free markets and high individual initiative produce better outcomes than central planning. However, they also believe in the awesomeness of corporations, which are generally run with central planning and no individual initiative. Is that clearer?
  - dennis_jeeves 7y ago
    >Many fans of capitalism believe it superior to communism because free markets and high individual initiative produce better outcomes than central planning. You are incorrect, when you start getting into nuances. When you have the govt doing central planning, there is no way to get rid of them when they under perform. When people voluntarily form central planning organizational structures, they are eliminated by the free market if they under perform. The difference between communism/capitalism is fundamentally of philosophy not of structure. In the former it's coerced co-operation (which almost always results in central planning) and the in the latter it is voluntary co-operation( there will be many organizational structures and some may have a central planning) How old are you? (no I didn't make a mistake when I asked you that question)
    - Talanes 7y ago
      >When you have the govt doing central planning, there is no way to get rid of them when they under perform. All Democratic governments include a way to do exactly that - by definition. There's room for debate over how effective it actually is at removing underperformers compared to the free market, but saying it has no way to get rid of them is just untrue.
      - antepodius 7y ago
        Is there? How often does the american federal government shrink? How would it shrink, if it turned out that it was too big? In a democratic government, you're not electing the central planners. In the american government, you're not electing any of the millions of three-letter agencies that rule your life. You hire a president, and he may or may not do something, who knows. At least a market has some contact with a ground truth of bankruptcy. If there were several competing EPA's competing for money on the basis of their efficacy, that might be interesting.

mattrp 7y ago

That’s a great term for it. It’s maddening to see it in the enterprise and just downright depressing when it creeps into a startup - like why do you think you’re here? To give enterprise vendors half your ebitda?