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Blame Cronyism, Not Capitalism

• deleted 5y ago
  [deleted]
• Miner49er 5y ago
  Cronyism is the logical conclusion of capitalism.
  • exo762 5y ago
    Market forces are objective, real, external. They eliminate weak competitors, and cronyism weakens companies. So if capitalism is defined by existence of the market forces... than you are wrong. If you define capitalism as market + capital and the your claim is that market in combination of other (than private property) ways of allocating capital would work better... I still disagree.
  • PaulHoule 5y ago
    Capitalism is not "markets", people have had markets at least as long as we've had agriculture. Capitalism is markets in pieces of paper such as government bonds, tulip futures, corporate stock, etc. Capitalism is a great platform for cronyism because it accumulates huge amounts of wealth in one place. Without capitalism the wages of corruption would be much less.
    • CryptoPunk 5y ago
      Yes, people have had capitalism since Homo Sapiens emerged. It just became more sophisticated, enabling higher levels of productivity. Institutions like contract law and constitutionally limited government helped the reign in corruption to some extent. If corruption is to mean deceit, abuse and exploitation, corruption has existed since as long as humans have existed. That is why homicide rates in prehistory were 30%.
    • glogla 5y ago
      One colleague once told me capitalism is the natural state of world and that her dog was capitalist, because it picked up a stick and refused to let it go - and that is why socialism and communism (same thing for her) will never work. When people consider your ideology "natural state of the world", you know your propaganda succeeded.
    • nybble41 5y ago
      > Capitalism is markets in pieces of paper such as government bonds, tulip futures, corporate stock, etc. Capitalism is private ownership of (and thus control, and benefit from) the means of production. Of these things you've listed, only corporate stock is—at some remove—a means of production. The stockholder owns part of the corporation which in turn owns capital goods. Anyone can save and invest and become an owner of capital. The only thing leading to concentration of wealth (under any economic system, really, not just capitalism) is that most people don't care to sacrifice present consumption for a larger future gain. Fortunately there are some who do.
  • bvaldivielso 5y ago
    Could you elaborate how? Is this specific to capitalism? or is cronyism the logical conclusion of any societal system that lasts for a while? For example, and just to choose an example that is obviously not capitalist, would you say cronyism wouldn't happen in a communist society? As far as I understand, it very much happened in the URSS. I'm not bashing on communism, just trying to understand your statement.
    • Miner49er 5y ago
      Capitalism rewards owning capital heavily, so it naturally trends towards wealth concentrating. The argument against this is to regulate it, but overtime, you'll always end up trending towards capital becoming more powerful then the regulators. You'll always have Capital just buying the regulators, basically. You can have "resets" (like the Great Depression and WWII) that maybe fix this a little bit temporarily, but it'll end up going back to cronyism again as power (i.e. Capital) starts concentrating again. Cronyism can exist in an economic system where there are positions of power. However, if you were to limit position of power, I believe you could make an economic system more resilient to cronyism. Obviously systems like the USSR had positions of extreme power so it was very prone to cronyism.
      • jimbokun 5y ago
        How do you create a society that limits positions of power? The US Constitution tries to do that by pitting different groups in power against each other, diffusing their power and forcing them to cooperate to achieve anything. And then adding a Bill of Rights specifically limiting the power government has over the individual. Do you have a better idea?
        • Miner49er 5y ago
          The US system isn't too bad, the main problem with it is capitalism. Under capitalism, you can't have a true democracy. The rich can always influence the public (Manufacturing Consent) or outright buy representatives. You have to keep wealth more distributed to avoid this, which means we need a system that doesn't so heavily reward and enable accumulation of wealth. I like many of the ideas of Mutualism [0]. Primarily the emphasis on credit unions, the limits on private property, and worker democracy. [0] https://en.wikipedia.org/wiki/Mutualism_(economic_theory) https://en.wikipedia.org/wiki/Mutualism_(economic_theory)
  • rubyist5eva 5y ago
    > Cronyism can plague any economic system, Klein explained, across the spectrum of free-market economies to governmentally controlled environments. Try reading the article?
    • Miner49er 5y ago
      Yeah, I agree, but I think there probably exists economic systems that are far more resilient to cronyism then capitalism. Whereas I think capitalism will always result in cronyism.
      • jimbokun 5y ago
        What are those systems? And where is the real world evidence they are more resilient to cronyism?
      • rubyist5eva 5y ago
        Such as?
        • Miner49er 5y ago
          Really anything that tries to democratize or distribute the control of Capital better. I wrote in another comment that I like parts of Mutualism [0]. I think the emphasis on credit unions, the limits to private property, and the emphasis on workplace democracy would help limit wealth from becoming too concentrated while still enabling economic development, arguably even enabling it better then Capitalism. [0] https://en.wikipedia.org/wiki/Mutualism_(economic_theory) https://en.wikipedia.org/wiki/Mutualism_(economic_theory)
  • refurb 5y ago
    As someone who lived in a communist system…no, cronyism is how you survive in a communist system. Otherwise you starve.
    • thrwn_frthr_awy 5y ago
      So you lived in a communist system with cronyism. That doesn’t invalidate OP statement. Cronyism is going to negatively affect all governments.
      • refurb 5y ago
        OP said capitalism.
  • lanevorockz 5y ago
    Cronyism is essential part of Big Government, something that is not necessary for Capitalism but completely necessary for Socialism.
    • pmyteh 5y ago
      The entire basis of modern public administration (and one of the reasons it can be more bureaucratic than market mechanisms for delivering services) is that it attempts to rigorously exclude cronyism. The reason for civil service tenure, for example, was to stop politicians selling public service jobs to the highest bidder, or handing them over as a quid-pro-quo for favourable decisions. As seen in the late 19th and early 20th Century 'Progressive' movement in the US, for example, the idea was for a government of the highest possible rectitude. Now, that obviously doesn't happen in all areas all of the time. And we have moved away from that kind of rules-structured ideal over the last forty years or so in pursuit of greater efficiency (which has re-introduced cronyism in the UK to a greater degree, for example - see the present government) but it's grossly over-simplified to say that cronyism is an 'essential' part of big government, when its original foundations were intended to produce a (big) government of laws and not men.
      • HPsquared 5y ago
        The existence of all these protections against cronyism in the public sector is evidence that it is an inherent problem. If it wasn't, there would be no need for all the protections. Edit: the problem is kind of moral hazard. Much like a chemical plant or nuclear reactor needs a range of protection systems to prevent the dangerous chemicals from going out of control, public administration needs a range of systems to prevent corruption getting too out of hand.
        • pmyteh 5y ago
          Yes indeed (and, even more so, the culture of non-corruption which reformers tried to put in place at the same time). But, like in the chemical plant, it is possible to run a government with minimal levels of corruption and many (better-governed) countries do it. It's not just a public admin problem, either - corruption and self-dealing are potentially endemic in the private sector, too. The concern has traditionally been higher for the public sector, both because of the potential for abuse of state power and because it is/was seen to be corrosive to public trust and self-government. A private company is more likely to trade off the cost of controls versus the dollar value of the future loss (or the controller is the one running the firm strictly for their own benefit, in which case they're likely to get away with it without intervention by the legal system). And the largest companies have had actual public power greater than the smallest countries for centuries by this point, so the two concerns are not completely disjoint.
  • pibechorro 5y ago
    And every other system with regularors..
  • deelowe 5y ago
    And every other form of government. What's the point?
• ajuc 5y ago
  That's like saying blame authoritarianism not communism. Communism led to authoritarianism in every country where it was tried. Blaming one means blaming the other indirectly. Same here.
  • flavius29663 5y ago
    The difference is this: in communism you always end up with authoritarianism, while in capitalism it happens less and less frequently. For this reason you can associate communism with authoritarianism. The corruption is NOT typical to capitalism, both capitalism and communism have plenty of corruption. As a citizen of a former communist state, I can say that communism has even more corruption in general. I think this is because capitalism doesn't deny that there is corruption and human beings at their innermost are not fair and just, so the capitalist institutions are designed to work around that. Communism on the other hand, assumes there is "a new man", which is fair, works as hard as they can and takes only what they need. But this is false, and never happens, so you need the state to enforce it, but then the people will still be humans and do what humans do: trade goods, services and influence, but under the table.
    • ajuc 5y ago
      What actually happens - you get communism and capitalism and both are equally evil when applied 100%. But you can get make them less concentrated, add less or more regulation and get to some sane compromies. You end up with some kind of social welfare state with mostly free market economy. At that point it doesn't matter where you started off, it's just branding.
      • flavius29663 5y ago
        > equally evil That is a very hard to defend statement...mass deportations, famine, misery and all the other staples of communism are not nearly as bad in capitalism. And if capitalist countries do this to each other, it's not capitalism per se to blame, it's other aspects of politics (imperialism, colonialism, Neo-colonialism etc.) that can be separated from capitalism. Whereas communism on its own cannot separate from its worse tenets. Being that they're not equally evil, IMO the middle ground is better to be closer to capitalism rather than in the middle. I personally believe in UBI, but I consider myself a liberal right winger. I believe UBI is good because it makes the bureaucracy and the government mostly obsolete except for the places it really matters: infrastructure, military, education etc. The UBI will be more transparent and automatic, people will know they live off other people's money, not "the government". And the government cannot keep robbing Paul to pay Peter with each and every bill. This should over time reduce the amount we spend on social programs, which is in line with what I believe as a liberal that wants less taxes.
• deleted 5y ago
  [deleted]
• amtamt 5y ago
  Why not blame human nature's shortcomings, instead of any *ism... Capitalism, Communism, Socialism and what not.
  • ansc 5y ago
    It's not very constructive, is it? "It's human nature to be exploited" Then again, not a lot seem to happen when pointing at short-comings or issues of prioritizing profit and growth above all else in society either.
    • jimbokun 5y ago
      This view point was the basis of the US Constitution. Do not trust any central power. Pit them against each other to limit what they can do. Enumerate the rights of the people that government can not infringe. The whole thing is based on the assumption that human nature tends to lead to exploitation of others, and build in safeguards against it.
    • jklinger410 5y ago
      It is very constructive because it points to the actual root of the problem so we can begin to solve it. Laws and regulation that prevent cronyism are the solution.
      • lbriner 5y ago
        Except humans, business and politics are far too complex to encapsulate in laws, at least in their current format. Look at a "simple" case in the news today. Several men who were abused in the 1970s have lost their case against Manchester City Football club who they say were responsible for the "scout" who abused them. If it was really simple, there would be no case. However, the Judge rules that at the time of the abuse, the man (who is currently in prison) was not officially a member of Man City staff so they are not liable vicariously for his actions. I think something that is lacking in the UK at least, is more like a Charter for Society. What is it that we accept and don't accept. It would be much easier in Court if a ruling is made not just on the letter of a law that might not have thought of the specific scenario, not on common law of something that was close enough to this case but on whether it violates the charter. Don't know, just a thought.
• episode0x01 5y ago
  Not a shocker that corruption ruins things. I guess then the question is how you can design a broadly distributed system that removes the incentives for corruption and minimizes its impact. My guess is that such a system won't be found in capitalism
  • CryptoPunk 5y ago
    It will be found in open source networks, and possibly will come into being through government funding.
  • mcv 5y ago
    Capitalism quite clearly requires strong regulation. At least, any sort of positive capitalism that doesn't immediately succumb to monopolies, cartels and corruption. The problem is that the loudest voices arguing for capitalism, also tend to argue against regulation, accountability, and that sort of thing.
    • thewarrior 5y ago
      Who regulates the regulator ? If it is the government then it goes back to the people being aware of their interests and not allowing themselves to be manipulated. Which is never going to be the case.
      • blululu 5y ago
        The answer to this question has always been ideology. Establishing a deep an sincere belief in the purpose of an undertaking on the part of its functionaries is the most durable way to run a community of any sort. Successful anarchist programs require some degree of ideological commitment to a greater cause. Switzerland is probably the most decentralized society on earth and you will notice the incredibly tight sense of right/wrong throughout Swiss society.
        • thewarrior 5y ago
          The people at the top are deeply cynical of ideology. They fill the ranks of middle management with true believers and play their own games.
• mchanson 5y ago
  Why not blame both?
  • oxymoran 5y ago
    That’s the point of the article…
  • pibechorro 5y ago
    did you read it?
  • marginalia_nu 5y ago
    It's a category error to blame ideas for anything. Ideas don't have agency, thus they cannot have guilt. Giving human attributes like intent and blame to ideas is reviving the old gods and giving them new names. Ideas don't have people, people have ideas. Every human action is carried out by a person. No action has ever been carried out by an idea.
• ericls 5y ago
  Capitalism describes Capitalism doesn't prescribe We should praise Capitalism for describing humanity better than other *ism
  • manuelabeledo 5y ago
    > We should praise Capitalism for describing humanity better than other *ism There are plenty of examples of non capitalist societies thorough history. What does "capitalism" describe about humanity, exactly?
  • lanevorockz 5y ago
    Capitalism is the ultimate democracy, everyone votes with their labour and their purchases. The more regulation, the less power the individual has. Of course, some regulation is necessary to avoid abuses. Discussions should be on the level of what rules allow society to reach a better result, not just try to artificially fix problems because it leads to even bigger problems.
    • manuelabeledo 5y ago
      > Capitalism is the ultimate democracy, everyone votes with their labour and their purchases. So only those who can perform jobs and buy things are able to vote? That sounds dystopian to me.
    • shove 5y ago
      Are you trolling? a) One dollar one vote? That's "ultimate democracy"? Really? b) how much labour would you say the average ceo does compared to the average low level worker? The ceo works 200-500 times as hard? Really?
    • bccdee 5y ago
      Everyone votes with their purchases, except the people with the most money get the most votes, and if you don't participate in the "elections" you starve? Sounds very democratic. Regulations typically limit the power of the most powerful in society, whose power in turn restricts the rest of us. Thus, regulation frequently increases the freedom of most citizens. Consider a business owner who treats his workers poorly. The workers could find new employers, but odds are they'd be treated just as poorly there, because these labour conditions are not atypical. Then a bill is passed which forces employers to improve labour conditions. Less power for elites means workers' freedom from having power exerted upon them increases.
• frgtpsswrdlame 5y ago
  Capitalism is not something that exists outside of government, governments create capitalism through property (and other) laws. And since capitalism forces firms to focus only on profit, it similarly forces them to attempt to corrupt government to increase their profits. The problem of cronyism exists inside of capitalism, not outside of it and not separable from it.
  • lanevorockz 5y ago
    Of course Capitalism exists outside of the government. Look at the extremes: Capitalism : Mercantile Exchange were value is created by the providers and users. Socialism : Central Government sets values and controls every single aspect of your life.
    • frgtpsswrdlame 5y ago
      Capitalism is based on rules of property and ownership, basically that I can own something, that you can't take it away from me through violence and that I can hire people to improve that something and they won't have an ownership stake on it (unless I want them to.) Those rules come from government. If you think about a society with no centralized rules on property and ownership, it wouldn't be very capitalistic, it would be much more like an anarchic steal-what-you-can system.
      • nybble41 5y ago
        Those rules regarding property and ownership predate government. The government likes to pretend that only it can enforce those rules, when in fact it is the entity most responsible for violating them. You can't seriously claim to enforce property rights when you yourself are seizing a sizable chunk of everyone's income for your own use. Also, there is no reason at all that the rules need to be "centralized" or promulgated and enforced by some special class of rulers. Property and ownership and the justice of proportional punishment for violating them are all logical consequences of self-ownership and reciprocation. People are perfectly capable of arranging to enforce their own rights without depending on an overgrown, overpriced, centralized protection racket.
• mcv 5y ago
  > "And maybe in places like India or China, and other parts of the developing world, they would say, ‘capitalist industries are causing environmental harm and inadequate healthcare" I don't think that's limited to "places like India or China".
• lanevorockz 5y ago
  Cronyism is indeed the disease and there is a solution on automation and transparency. Big Government is not the solutions and it will only make all the problems worse. I really don't understand why so many smart people think that solution for the whole world is to sit down and vote money into existence. I will never work because it just can't work, everyone is different and has different priorities. A better world can only be built from the bottom up, just look at craft beer and how independent people were able to retake one of the most monopolistic industries in the world.
  • syki 5y ago
    Have you considered the possibility that those “so many smart people” understand these things better than you? Have you considered the possibility that the craft beer industry can’t work or isn’t feasible to occur in other sectors?
  • MSFT_Edging 5y ago
    How exactly would automation assist in making an economic system more democratic and beneficial to the general population? Greater automation would simply push people further away from any wealth generated, creating more powerful cronies, and continuing the trend of low paid, low quality, serf like jobs in the service industry.
    • lanevorockz 5y ago
      That is a problem that needs cracking but you are starting to see the solution emerging on the crypto and DeFi work.
      • cowpig 5y ago
        What solution? The DeFi space is a lot worse than the traditional economy by just about any measure right now: inequality, theft, fraud, instability, market manipulation, etc are all way worse.
• usrbinbash 5y ago
  [flagged]
  • mbostleman 5y ago
    What you're describing here is not capitalism but rather a single unwanted scenario that can come from it, specifically when there are too few producers in a category or, in your example, when there is only one.
    • pygy_ 5y ago
      Market consolidation seems to be the mechanical conclusion of the current rules of the capitalist system, thanks to compounding effects.
    • bavell 5y ago
      Yes, it also ignores that price is only one of many factors in the market - doesn't matter to some consumers how cheap your widget is if my widget has new tech/features not found in your widget and consumers need those features. So company A in the example could drop prices and still not be able to compete with the superior product from company B. Happens all the time in the real world.
  • asow92 5y ago
    And what is your solution? You can say something is flawed, but compared to what, and how would you improve it?
    • depaya 5y ago
      It's ok to express frustration with something without having a solution to it.
      • asow92 5y ago
        How about you? What's your solution?
      • 5y ago
• wjmao88 5y ago
  I mean sure, you could blame cronyism for any ideology or systems because these ideologies were always presented, as the name implies, in an ideal situation. What is always important is the ability of that system to be fault tolerant in a not so ideal world, which is where capitalism fails and that is squarely on capitalism itself.
• throwawaymanbot 5y ago
  [dead]
• an_alien_heat 5y ago
  “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” -- Adam Smith
• swader999 5y ago
  Capitalism without fair competition is not capitalism. There needs to be rules and regulation to have a level field. Huge barriers to entry, monopoly, oligarchy and so on all pervert capitalism. Currently, it's far far away from a good place.
  • Devasta 5y ago
    How is capitalism without competition not capitalism? The capitalist is served very well by it, earning huge piles of money.
    • swader999 5y ago
      Competition is a key tenant of capitalism. It doesn't optimize and serve society without it. It holds individual's and corporation's self interest to maximize profit in check.
      • Devasta 5y ago
        Capitalism serves capitalists, any serving of society is a side effect of same and is certainly not intentional.
• shove 5y ago
  Two things can be bad.
  • lbriner 5y ago
    And I would expect many of capitalism's detractors would say that capitalism encourages cronyism. Personally, I think all governments of all persuasions have proved their ability to line their own pockets, sometimes subtly and sometimes with bare-faced shame. Many people think the go-to is more laws to try and dictate what is and isn't acceptable but that also doesn't seem to work, just creates more jobs and more money for the lawyers. I think the old adage, "don't curse the darkness, light a candle" is the best back-stop. If anyone knows a better way, do it and show how it is better, then others will copy it.
    • 6510 5y ago
      You have to set the punishment high enough to prevent repetition of the offense. The death penalty seems suitable as great harm is done to a huge number of people. One bad move and democracies kill and maim millions.
• jacknews 5y ago
  "...that some government interventions to address the apparent shortcomings of capitalism invite cronyism" LOL, so yet again, govermint is the problem! It should be increasingly clear by now that capitalism itself is the problem. It naturally leads to the rich getting richer, and despoils everything in the name of profit, unless it is reigned in by government, taming it for the benefit of society, not just profit and growth. Cronyism is a symptom of too much private power.
  • umvi 5y ago
    Pretty much every form of government/economy has cronyism problems. Crony capitalism, crony socialism, crony communism, crony dictatorships, etc. all exist. It's human nature to want to help your friends before helping strangers, but that attitude leads to corruption when people in positions of power practice it repeatedly.
  • fennecfoxen 5y ago
    Don't worry! Cronyism can be a symptom of too much public power, too! Did you think that Chinese firms thrive on merit, or access to cheaper-than-free capital supplied by political connections?
    • jacknews 5y ago
      Yes, when I wrote 'private power', I really meant 'personal power'. Some of the worst cronyism is in so-called communist countries.
  • mostertoaster 5y ago
    Capitalism will lead to wealth inequality even apart from cronyism. Yet in general it makes a populace who tries it, more fat, and grants a life of more pleasure, than any of its counterparts. This itself might be bad for a nation though. First you get a bunch of people in government who think they should get a percentage of that wealth made by the merchants (just like the feudal lords of old) Second, the nation becomes so wealthy it has to just keep consuming more and more, and at some point people start having to come up with insane ideas, and gladiator sports, and just become a bunch of addicts because life has no purpose and is too easy. I think I’m personally ready for some socialist/communist policies so people in my country can experience some actual suffering, and maybe even go hungry, and then at least they will stop talking about the pointless crap they always go on about it.
• aww_dang 5y ago
  The author makes an important distinction between state enabled cronyism and market activities. Comments here seem to be missing the point. Regulation is the pretense which enables cronyism. I enjoyed his appearance on the "Economics for entrepreneurs" podcast.
  • vannevar 5y ago
    >Regulation is the pretense which enables cronyism. Sort of, if you narrowly define cronyism as government favoritism. But it would be more accurate to say that capitalism itself encourages cronyism---in the absence of regulation, there is no need to rope in government officials and so the cronyism stays in the private sector. But it is no less cronyism. The article misses the real problem, which is that the over-concentration of capital that develops naturally in unregulated capitalism starves the general population of economic opportunities that they would otherwise have if the capital were more decentralized. It's also corrosive to democracy, which depends on the assumption that people are more or less equally empowered politically, at least within a few orders of magnitude.
    • aww_dang 5y ago
      >the over-concentration of capital that develops naturally in unregulated capitalism... In such an unregulated capitalism system the producer would only obtain wealth by freely trading. It is the state intervention which creates the conditions for the centralization of wealth. We're living in a time where interest rates (set by appointed technocrats) don't keep pace with the rate of inflation. Inflation as it is originally defined means literally to inflate the money supply. Again, the money supply is determined by unelected appointees. These same experts form a "plunge protection team" determined to protect financial markets, at the expense of all other participants in the economy. So yeah, we're seeing a large amount of wealth inequality currently. We could turn to the historical cases as well. Railroad monopolies and government bailouts of these essential industries owned and controlled by blue blood families. What I have a hard time turning to and finding empirical evidence for, would be this mythical unregulated capitialist economy which produced so much of the the inequality critics of laissez-faire capitalism ceaselessly cite.
• mrkentutbabi 5y ago
  Is wealth inequality necessarily bad? Genuine question here.
  • lexapro 5y ago
    It's good for some, bad for a lot.
  • hrhrhrhrhr 5y ago
  • francisofascii 5y ago
    Like many things in life, wealth inequality is good in moderation. Excessive wealth inequality is very bad, especially if it is due to unfair/rigged situations.
  • lbriner 5y ago
    I assume you are implying that wealth inequality is a motivator that makes people work harder and aim higher. As with everything else in the universe, it works for some, it doesn't work for others and there are plenty who have almost literally no opportunities for whatever reason. In western nations we think that most people have basically the same opportunities but if you are from a low-income family, you are likely to have more issues with your family, potentially more emotional and financial dependents. If you have been knocked back too many times, you can lose confidence and not have anyone to encourage you. I guess in moderation, wage differences can motivate but at the point someone drops too low, they easily get caught in a cycle and then it becomes societies problem.
  • goodlinks 5y ago
    if there was a lottery defined 99% of your life outcomes at birth would that be a bad thing? if it was possible for an accumulation of wealth within one group to essentially divide humanity in different groups that could never be changed despite skill level compitance or morals of the individuals in each group would that be bad? so someone whose great great granddaddy did something now has power for no reason. and their line of decendands wont be able to spend money as fast as they accumulate it - without even understanding how or why. wealth accumulation and private serveices (like education and healthcare) kind of make this an inevitability imho. AFAIK its not one person being paid more than another thats the issue.. its those that are paid because they were born with money and add nothing to society that i think bothers people. EDIT: a good book -The Ragged Trousered Philanthropists- for considering capitlism and the accumulation of wealth (also shock how relevant it is still 120 years later): https://freeclassicebooks.com/Robert%20Tressell/The%20Ragged%20Trousered%20Philanthropists.pdf https://freeclassicebooks.com/Robert%20Tressell/The%20Ragged...
• boringg 5y ago
  Corruption (Cronyism) is the route of issues in ALL economic systems (much worse in other systems such as autocracies, socialism, authoritarian socialism, etc). So let's not throw the baby out with the bathwater (see US scientific accomplishments in the last decade). What needs to happen in the US to help right the ship is that the legal system needs to be tightened up and money needs to be significantly taken out of politics, the K street rotating door between government needs to be severed, and public wages (i.e. being a judge or public attorney) need to be competitive to private wages to ensure we have talent working to uphold the lack of corruption. This wave of pro socialism is (a) greatly misunderstood by the majority of the people peddling it and (b) is a vote against the current situation without understanding what the situation they are about to jump into looks like (always thinking their are greener pastures).
  • serverholic 5y ago
    I definitely think there is a lot of "grass is greener" thinking going on right now. Especially amongst those on the far-left who are pushing communist/socialist ideas on twitter. I had a discussion on reddit recently with a communist and the gist of their argument was basically: 1. I'm having a tough time in life because I have skills that aren't very profitable under capitalism. 2. Under communism the idea is 'from each according to their ability and to each according to their need'. 3. This removes the profit motive so my skills will be valued more under communism. The problem is that these people aren't thinking about 3rd, 4th, 5th, etc order effects of their ideas. For example, profit isn't necessarily a bad thing. Profit encourages people build more things and efficiently use resources. You can't expect the same level of prosperity without a profit motive.
    • boringg 5y ago
      Agree. A lot of it is knee jerk reactions to the current situation. Its not to dissimilar from people voting out the current government because they are unhappy with their situation but without vetting the alternative (see brexit). Anyways its a dangerous situation as there is foment-able rage on the left (and many cases it is warranted).
• netcan 5y ago
  OK so... the "no true scotsman" game between warring ideologies is what it is. Marx more or less invents "capitalism" in his critique of it. Pro capitalists then came in with their own definitions of capitalism. Later anti-communists insist(ed) that socialism=stalin, and capitalism means liberalism. Whatever. Capitalism means different things. I'm not going to unknot that mess. But... I will say that etymologically (ie in the early rhetoric), the word "capitalism" meant "regime where capitalists rule." Monarchy = monarchs rule; democracy means the people rule, etc. IE, the old banana republics would have represented near perfect capitalism. In any case, I don't see why "Academy of Management Perspectives" decided to bring big-c "Capitalism" into it. What part of capitalism are they examining/exonerating? Defining capitalism simply as "private ownership & the existence of markets" is silly. This exists in many times and places that you couldn't credibly call capitalism. Considering the context (Macedonia?) I think what is meant by "capitalism" is economic policies & changes of the last 30 years. Washington Consensus monetary policies, international/american compatible corporate/contracts law and such.
  • pram 5y ago
    I've also long been perturbed by the definition of capitalism largely focusing on markets, private property, and even entrepreneurship. Since those are like, as old as human civilization probably.
    • vannevar 5y ago
      Why does the idea that capitalism has co-existed with civilization perturb you? Not criticizing, just honestly curious.
      • deleted 5y ago
        [deleted]
      • pram 5y ago
        Not what I said at all lol
        • 5y ago
• vlunkr 5y ago
  For the political experts out there, what would happen if we stopped allowing lobbying? That seems to me like the most obvious source of corruption. Edit: ok, I should have worded better. What if we stopped allowing corporate lobbying through donations to elected officials? I understand there would be loopholes to close, but isn't this the obvious source of government corruption?
  • nopenopenopeno 5y ago
    Not a very useful thought experiment once you accept that you’d have to out-lobby the lobbyists to get it done.
  • aww_dang 5y ago
    The incentive for lobbying would remain and turn more deeply to black markets. To end lobbying you'd need to remove the incentive for lobbyists to seduce lawmakers. Instead, remove the power of lawmakers or reduce/decentralize the power as much as pragmatically possible.
    • justinmchase 5y ago
      In Plato's ideal republic the lawmakers, or protectors, were instead removed from society living in a parallel society dedicated to service. Therefore they would be incorruptable, or difficult to corrupt.
      • zipswitch 5y ago
        Which leads to Nassim Taleb's "no skin in the game" problem.
        • 6510 5y ago
          Or in the case of robot overlords no skin at all.
  • hypersoar 5y ago
    The broad concept of "lobbying" is really just people bringing their concerns to elected representatives. I don't really see how you would ban it entirely.
• petermcneeley 5y ago
  Whats the cause of amazon workers reportedly having to pee in bottles? Is that the government? Capitalism is just evolution without physical war. It has the same beauty and horror as a lion eating a gazelle alive.
  • refurb 5y ago
    What is the cause of the worker who needs to pay the boss a $1,000 bribe to get a lucrative job in a communist system? Is that the government?
  • Broken_Hippo 5y ago
    Whats the cause of amazon workers reportedly having to pee in bottles? Is that the government? Yes, as a matter of fact, it is! Or rather, lack of effective government. An effective government would not only have laws to protect the workers, but also have a regulatory zeal to enforce such laws in ways they bite the employer, who obviously isn't treating its workers well enough.
• rado 5y ago
  Blame Expectations, Not Reality
• Devasta 5y ago
  Complaining about crony capitalism, yet using a computer, driving on roads, buying stuff from stores, all things provided by crony capitalists. Go live in a cave if you have a problem with it.
• asow92 5y ago
  It seems like cronyism can manifest in any system just as well as capitalism. Collectivist-isms are just as susceptible, and are perhaps more susceptible given their inherent dependence on the state's management of capital and resources. What do you think?
• MichaelGlass 5y ago
  "Government casuses cronyism -- especially anti-cronyism laws". What should the role of government be? I guess the authors would say: Governments should be replaced with financial modeling. I'm not convinced. There's something fundamentally undemocratic (and perhaps, sadly, realistic) about this take. Will advocating for broad de-regulation and business rule actually reduce cronism? Will it / can it reduce negative externalities? I just think ... we've tried that. It's been the experiment of the last 40 years. What's next?
  • simonh 5y ago
    I think the best approach is a balance of powers between multiple branches of government, as we have in many liberal democracies. Executive, legislative and judicial. It's a long way from perfect, but it's actually worked pretty well for hundreds of years. Combined with a robust system of individual freedoms of speech, association, ownership and labour rights. What that all adds up to is capitalism plus regulation by a representative government. The main alternatives that have been tried concentrate power in the hands of a single group, or ultimately a single person. In fact arguably giving power to a single group implicitly gives it to the leader of that group. This has always been a disaster, and always will be a disaster as long as we are recognisably human, with all the associated flaws. Corruption and abuses are the result of human failings. We're always going to have to continuously strive against them.
  • peteey 5y ago
    The past 40 has seen an increase in housing regulation. NIMBYs create restrictive zoning rules. Developers can only build after attending dozens of meetings. City council must grant an exception to the NIMBY laws. Only wealthy developers can afford the process. Various council and board member get kick backs for the exemptions. Housing is an important example because its the most expensive thing most people purchase. Grift is enabled by individuals electing representatives who oppose construction, not capitalism.
• chaboud 5y ago
  One certainly can’t just put a bow on blaming cronyism and assume that capitalism without cronyism would just work (which is what the title implies…. And the article hedges but still kind of implies). Capitalism eventually leads to some pretty unbalanced outcomes as the distribution of profit to the factors of production shift, and it’s not clear that those imbalances would stabilize/correct without extreme intervention (e.g., illegal acts, revolution). We’re seeing a shift to greater distribution for labor, but that’s after a very long period of favoring capital that doesn’t seem so much to be breaking down as giving way just a tiny bit (like a pressure release valve). In a fully automated farming, manufacturing, and delivery future, it’s hard to see how capitalism alone would allow for the maintenance of a functioning society. Such conditions would heavily favor engineering/design, raw resources, and (most of all) capital over physical labor. And, of course, any practical regulation will be imperfect and will lead to functional cronyism as a result of imperfect people working to craft evolving and imperfect laws…
• vannevar 5y ago
  Why is cronyism bad? Because it distributes opportunity based on relationships rather than merit. Why is unregulated capitalism bad? Because it distributes opportunity based on capital rather than merit. But cronyism by definition operates at a human scale---a person can only have so many friends, after all---while the scale of capital is unlimited. in principle, one person can deprive millions of people of opportunities that might otherwise be available to them. So unregulated capitalism is a much, much bigger problem than cronyism.
  • hrhrhrhrhr 5y ago
  • jimbokun 5y ago
    > But cronyism by definition operates at a human scale---a person can only have so many friends, after all If your friends are Senators, Representatives, and the President, you can also deprive unlimited millions of people from opportunities.
    • vannevar 5y ago
      This is a great point. But your friends are unlikely to be Senators, Representatives, or the President unless you also have substantial capital.
  • simonh 5y ago
    OK, but getting rid of capitalism doesn't get rid of capital. No economic system has ever done that, and so you still have the problem that whoever controls capital has the power that comes with it. So who gets to control the capital, and what system of laws and regulations do we enforce that both protect and circumscribe how that capital is managed and used? This is the problem Marxists have struggled with, and never managed to convincingly answer.
    • vannevar 5y ago
      I think capitalism is great, it has a lot of benefits. But it can't just be left open-loop. You're right that the concentration cannot be avoided, but it can be mitigated so that it does not become catastrophic, which I would argue is the point we are nearing. Wealth and income disparities have not always been as acute as they are today.
• echopurity 5y ago
  [dead]
• recursivedoubts 5y ago
  Chesterton said that “too much capitalism does not mean too many capitalists, but too few capitalists” I think this concept applies to cronyism as well: we will always have cronyism and corruption and no system we can dream up will eliminate it. Therefore we should distribute the cronyism as much as is practical to minimize and localize the damage it can do. Bad behavior is less likely when you live within driving distance of the person you are inflicting it on. In practice this means many more small, relatively independent political units. An idea for which there is nearly zero support amongst the current elites who are nearly unanimous in wanting more centralization, which makes sense when considering their interests. I do hear occasionally about a national divorce, which would be a good start.
• drewcoo 5y ago
  Insight: There is a single source of all harmful side-effects. Insight: It's not capitalism. It's something else. Perhaps the actual problem for the author is education because any moderate amount of reading comprehension coupled with a little skepticism should keep "insights" like this from spreading.
• nirui 5y ago
  > capitalism increases inequality, it favors the wealthy at the expense of the poor Does pure capitalism without cronyism give everybody an equal chance though? What if cronyism is the very product of current capitalism? Finger swap is useless. To actually fix a problem, we need to find the root cause and fix the entire tree of problems one by one.
• trembonator 5y ago