Wednesday, March 24, 2010

Obamacare Is Corporatist, Not Socialist

Reader Walt takes us from my comment that "this is a disaster, except that it is not so much a socialist disaster as it is a corporatist one," noting that "former Nat'l Review writer David Frum and former Clinton admininistration economist Brad Delong both have pieces this week pointing out that this bill is filled with mainly old GOP "free market" counter proposals to Hillary Care from the early nineties" and posting a link to an informative 2002 article by Robert Locke — What is American Corporatism? An excerpt:
    Unlike socialism, corporatism understands that direct government ownership of the means of production does not work, except in the limiting case of infrastructure.1 ...Corporatism blends socialism and capitalism not by giving each control of different parts of the economy, but by combining socialism's promise of a government-guaranteed flow of material goods with capitalism's private ownership and management.

    What makes corporatism so politically irresistible is that it is attractive not just to the mass electorate, but to the economic elite as well. Big business, whatever its casuists at the Wall Street Journal editorial page may pretend, likes big government, except when big government gets greedy and tries to renegotiate the division of spoils. Although big business was an historic adversary of the introduction of the corporatist state, it eventually found common ground with it.

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Blogger Mark in Spokane said...

One reason for the friendliness of big business to big government deals with barriers to entry for business competitors. The regulatory schemes enacted by the government don't both big business much -- thanks to small armies of lawyers and economies of scale, big business almost always can navigate around the government's plans. In many instances, thanks to notice and comment rule-making at the agency level, business even has a hand in the crafting of the regulations that are supposedly limiting their activities.

What the regulations do accomplish is to hamper entry into the marketplace of start-ups and small businesses who do not have the legions of lawyers and economies of scale or the influence in the hallways of power. The regulations effective prevent those businesses from being able to compete, thus furthering the security of big business.

A textbook example of this phenomenon is Microsoft in the 1990's...

1:08 PM  
Anonymous Steven P. Cornett said...

RE: Mark,

The prototypical examples of this are also the founding act for the FDA, which benefited the big meat processors that the Progressives condemned over the small butchers that often did their jobs correctly.

The worst example, and one with many parallels to the passage of the Package of Abominations (aka Obamacare) is the Federal Reserve Act. The committee from which that came was founded to reform banking and break up the "money trust" which was seen as having a role in the 1907 crash. Instead, the Fed Act was written at a meeting on Jekyll Island by the group of nine heads and major men of the New York Banks, who prior to this were enemies (in the Rockefeller and J.P. Morgan camps).

The bill, reshuffled several times and with provisions added to sweeten the deal for populists, passed in 1913, and as a result the US dollar today is worth approximately one Nickel in 1913 coinage.
The Fed, which was sold as a way to stabilize the economy, caused several major real estate and commodity price bubbles, at least seven major recessions and the Great Depression, and at the end of every one the smaller banks got destroyed and the New York cartel's share of the wealth grew.

7:52 PM  

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