More and more young people are moving away from capitalism. Capitalism is less popular now than it was 10 years ago. Back then, 68% of young people thought capitalism was good.
Today, that percentage dropped by nearly 20%. This is likely linked to the economic downturn of America and the failure to fully recover. Additionally, the inability of capitalism to provide unquantifiable goods.
As a result, many favor corporatism over capitalism. Corporatism vs capitalism is the debate facing many across the globe, not just in America. However, some proponents of capitalism rebuke corporatism as a “luxury belief”.
What are these ideologies? Let’s find out more!
What Is Capitalism?
There are many forms of capitalism in the world today. Most people believe the United States is the best example of pure capitalism. This is not true, though.
The United States practices a hybrid form of capitalism. The economic philosopher Adam Smith boils capitalism to its purest form. A self-balancing system of economics without government intervention.
But, when many speak of capitalism today they do not mean this purest ideology. Rather, they speak of a system of limited government intervention. Under this idealist system, the individual is paramount as the driving force of economics.
Stripped of the idealist definitions, capitalism seeks to maximize production. It seeks to maximize production with minimal waste and high-profit yields.
What Is Corporatism?
In U.S. politics you often hear the phrase “corporatism” tossed about as the pollution of capitalism. But, some experts defend this position as an improvement on capitalism. We will explore this in the next section.
Defining corporatism is a little more complicated than capitalism. It is such a loaded term. But, boiled down to the bare bones, corporatism is the regulated free market.
By definition, this seems contrary to the key element of free-market capitalism. But, as philosopher Michael Sandel points out, some goods aren’t quantifiable with money.
Corporatism seeks to regulate the behavior of corporations through laws and statutes. But, corporatism has a sketchy past and problematic applications.
Corporatism was formed by Mussolini back during the second world war. Many fearful of this system see a fascist system of economics.
Corporatism vs Capitalism: Comparisons and Issues
The main critique of capitalism is its inability to quantify all manner of goods. For example, the invisible hand of the market fails to account for clean water. It fails to quantify the value of alleviating poverty and funding education.
At its core, capitalism believes the economic system should propel all goods. But, critics state it is incapable of doing so.
Corporatism is seen as the solution to these issues. The idea is rather simplistic at its root. By removing the economic incentive it will incentivize “good behavior” over “bad behavior”.
Unfortunately, this system carries with it its dangers. One of which is the diminishing middle class and the increasing corporate sway over politics. Large corporations have more economic power. When the government creates new laws and regulations they can afford it.
They either pay the fines imposed for failing to adhere or make the adjustments. But, small businesses do not have this economic flexibility and often suffer as a result.
The issue remains then to bridge this gap. By imposing regulations, the government is ultimately creating unfair competition. But, they cannot simply permit businesses to run amok over their workers and the environment.
Corporatism vs Capitalism: a Balanced Approach
This article did not intend to posit corporatism vs capitalism as a fighting match. Nor did it wish to push for one ideology over another.
What it seeks to convey is an honest depiction of both and how they impact the “little guy”. Too often the average person is preached to by the powerful members of society.
The goal of this article is to empower the reader with honest information. Our blog is dedicated to conveying information accurately and entertainingly! Check out more of our content for informative pieces.