# Start Here > Guest Forum >  "We have Corporatism, not capitalism."

## Harmonica

I'm confused as too why Ron Paul and Libertarians say there is a system of corporatism, not capitalism.

"Capitalism is an economic system based on private ownership of the  means of production and the creation of goods and services for profit."

This  is quite clearly what we have in the majority of the Western world. You  can argue that the current system is closer to corporatism, but you'd  be missing the point entirely - corporatism values the rights of the  collective over the rights of the individual. In corporatism,  individuals exist only insofar as they exist as members of a group.

At  least in America, corporations are treated as extensions of the  individual. In fact, they are given all the same rights as individuals,  not a set of individual "corporation rights".

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## Lucille

Is it quite clearly what we have?  

http://blog.independent.org/2012/10/...atory-fascism/




> For thirty years or so, I have used the term participatory fascism, which I borrowed from my old friend and former Ph.D. student Charlotte Twight. This is a descriptively precise term in that it recognizes the fascistic organization of resource ownership and control in our system, despite the preservation of nominal private ownership, and the variety of ways in which the state employs political ceremonies, proceedings, and engagementsmost important, votingin which the general public participates. Such participation engenders the sense that somehow the people control the government. Even though this sense of control is for the most part an illusion, rather than a perception well founded in reality, it is important because it causes people to accept government regulations, taxes, and other insults against which they might rebel if they believed that such impositions had simply been forced on them by dictators or other leaders wholly beyond their influence.
> 
> For the rulers, participatory fascism is the perfect solution toward which they have been groping for generations, and virtually all of the worlds politico-economic orders are now gravitating toward this system. Outright socialism is a recipe for widespread poverty and for the ultimate dissolution of the economy and the disavowal of its political leadership. Socialism is the wave of the past; everywhere it has been tried seriously, it has failed miserably. Participatory fascism, in contrast, has two decisive advantages over socialism.


"The test of fascism is not one's rage against the Italian and German war lords. The test is  how many of the essential principles of fascism do you accept and to what extent are you prepared to apply those fascist ideas to American social and economic life? When you can put your finger on the men or the groups that urge for America the debt-supported state, the autarkical corporative state, the state bent on the socialization of investment and the bureaucratic government of industry and society, the establishment of the institution of militarism as the great glamorous public-works project of the nation and the institution of imperialism under which it proposes to regulate and rule the world and, along with this, proposes to alter the forms of our government to approach as closely as possible the unrestrained, absolute government  then you will know you have located the authentic fascist.

"But let us not deceive ourselves into thinking that we are dealing by this means with the problem of fascism. Fascism will come at the hands of perfectly authentic Americans, as violently against Hitler and Mussolini as the next one, but who are convinced that the present economic system is washed up and that the present political system in America has outlived its usefulness and who wish to commit this country to the rule of the bureaucratic state; interfering in the affairs of the states and cities; taking part in the management of industry and finance and agriculture; assuming the role of great national banker and investor, borrowing millions every year and spending them on all sorts of projects through which such a government can paralyze opposition and command public support; marshaling great armies and navies at crushing costs to support the industry of war and preparation for war which will become our greatest industry; and adding to all this the most romantic adventures in global planning, regeneration, and domination all to be done under the authority of a powerfully centralized government in which the executive will hold in effect all the powers with Congress reduced to the role of a debating society. There is your fascist. And the sooner America realizes this dreadful fact the sooner it will arm itself to make an end of American fascism masquerading under the guise of the champion of democracy."
-- John T. Flynn, As We Go Marching, 1944

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## TheNewYorker

But corporations are owned by people, so therefore shouldn't corporations be considered people?

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## Cabal

It seems you're leaving out the relevant context.

When people like Ron Paul, or libertarians discuss capitalism, they're generally referring specifically to the idea of laissez-faire or free market capitalism. What we have today does not meet the standards of this particular brand of capitalism, or so they would argue.

When they mention corporatism, the particular brand of corporatism being referenced is of the fascist persuasion.

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## otherone

> I'm confused as too why Ron Paul and Libertarians say there is a system of corporatism, not capitalism.


This will clarify things for you.
http://www.ronpaul.com/2010-04-25/ob...a-corporatist/

Understand that "corporatism" implies a governmental system rather than an economic one.
Corporatism strangles capitalism.

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## Ronin Truth

*"Capitalism should not be condemned, since we haven't had capitalism." -- Ron Paul*

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## The Gold Standard

> "Capitalism is an economic system based on private ownership of the  means of production and the creation of goods and services for profit."
> 
> This  is quite clearly what we have in the majority of the Western world.


No, it isn't. If they can tax it, the people don't own it. And if the people don't own it, it isn't capitalism.

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## Rad

Corporatism! http://www.sjsu.edu/faculty/watkins/corporatism.htm

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## Harmonica

> It seems you're leaving out the relevant context.
> 
> When people like Ron Paul, or libertarians discuss capitalism, they're generally referring specifically to the idea of laissez-faire or free market capitalism. What we have today does not meet the standards of this particular brand of capitalism, or so they would argue.
> 
> When they mention corporatism, the particular brand of corporatism being referenced is of the fascist persuasion.


This argument seems a wee bit No True Scotsman, if I'm honest.

Laissez-faire  capitalism is pretty idealistic by any standard. It's basically  assuming that in a free market, nobody will even have the idea of  establishing a monopoly. Furthermore, I fail to see how corporatism and  such oligarchy-esque systems aren't just different forms of capitalism.  Sure, the individual is no longer the most powerful and basic entity and  the definition of "private" ownership has changed, but it's just  capitalism under a different name.

Regardless, it seems that this  argument could go on forever for a simple reason - it comes down to  which form of capitalism we think is best, and therefore which one we  will say is the "true" form of capitalism. But we'd be missing the  point.

"Capitalism is an economic system based on private  ownership of the means of production and the creation of goods and  services for profit."
"Corporatism, also known as corporativism, is  the sociopolitical organization of a society by major interest groups,  or corporate groups, such as agricultural, business, ethnic, labour,  military, patronage, or scientific affiliations, on the basis of common  interests."

These are not incompatible ideas. Corporatism is  simply capitalism with a different definition of "private ownership".  However, if we DID live in a system like corporatism, then society would  be a whole lot more collective rather than individual. There's evidence  out the wazoo that in the Western world individuality is held above all  else, so this sort of disproves that whole notion.

Not even  going to bother responding to that whole "American fascism" opinion  piece *Lucille* quoted, since it isn't your own argument and doesn't even  really relate to my point anyway.

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## Isaac Bickerstaff

Here is a couple of economic/political philosophy flash cards:

Capitalism - Your own risk, your own reward

Corporatism(fascism) - Socialized risk, privatized profit

Which is closer to what we have?

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## otherone

> Laissez-faire  capitalism is pretty idealistic by any standard. It's basically  assuming that in a free market, nobody will even have the idea of  establishing a monopoly.


Huh?

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## The Gold Standard

> Laissez-faire capitalism is pretty idealistic by any standard. It's basically assuming that in a free market, nobody will even have the idea of establishing a monopoly.


No, it isn't assuming anything like that. Do you know anything about these ideas you are disparaging? In a free market, I'm sure lots of companies would try to become monopolies. The difference is they wouldn't be able to set a monopoly price on their product or service, because without barriers to entry, a monopoly price leaves room for others to enter the market at a lower price and make a profit. So, either the monopoly gets undercut by new competition, or the monopoly doesn't raise their prices, at which point who gives a $#@! if they are a monopoly or not? In the United States, even before the fascist/socialist hybrid it became in the 20th century, government created privileges and barriers to entry are what have allowed monopolies in the past, and are the cause of them to this day.

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## Lucille

> Not even  going to bother responding to that whole "American fascism" opinion  piece *Lucille* quoted, since it isn't your own argument and* doesn't even  really relate to my point anyway*.







> What of any consequence remains beyond the states reach in the United States today? Not wages, working conditions, or labor-management relations; not health care; not money, banking, or financial services; not personal privacy; not transportation or communication; not education or scientific research; not farming or food supply; not nutrition or food quality; not marriage or divorce; not child care; not provision for retirement; not recreation; not insurance of any kind; not smoking or drinking; not gambling; not political campaign funding or publicity; not real estate development, house construction, or housing finance; not international travel, trade, or finance; not a thousand other areas and aspects of social life.
> [...]
> The areas of life that remain outside the governments participation, taxation, subsidization, regulation, surveillance, and other intrusion or control have become so few and so trivial that they scarcely merit mention. We verge ever closer upon the condition in which everything that is not prohibited is required. Yet, the average American will declare loudly that he is a free man and that his country is the freest in the world. Thus, in a country where more and more is for the state, where virtually nothing is outside the State, and where, aside from pointless complaints, nothing against the State is permitted, Americans have become ideal fascist citizens. Like the average German during the years that Hitler ruled Germany, most Americans today, inhabiting one of the most pervasively controlled countries in the history of the world, think they are free.

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## Cabal

> This argument seems a wee bit No True Scotsman, if I'm honest.


What? It's not an argument. It's an explanation of context and specificity. There is not only one brand, if you will, of capitalism. There are several. Just as there are several brands of corporatism. That's not a matter of "No True Scotsman," that's a matter of accuracy.




> Laissez-faire  capitalism is pretty idealistic by any standard. It's basically  assuming that in a free market, nobody will even have the idea of  establishing a monopoly.


It makes no such assumption.




> Furthermore, I fail to see how corporatism and  such oligarchy-esque systems aren't just different forms of capitalism.  Sure, the individual is no longer the most powerful and basic entity and  the definition of "private" ownership has changed, but it's just  capitalism under a different name.


If you cannot see the difference between State force and voluntary exchange... that doesn't bode well for you.

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## Mikefive

The difference between Capitalism and Corporatism has nothing to do with who OWNs businesses and everything to do with who CONTROLs them.  The healthcare industry might be the best example.  The consumer can't buy insurance outside of their state.  Why not?  Because the gov't doesn't allow it.  You MUST get your blood pressure checked when you go to the doctor.  Why?  Because gov't says so, which also means that you can't go to a more affordable doctor who doesn't do that.  Go to any hospital and see for yourself all of the inane rules put in place by... you guessed it... the government.

As a hospital example, I'm an insulin dependent diabetic and went to the hospital with chest pain (that I think ended up being heartburn).  Anyhow, I explained my insulin regimen when I was admitted.  But then long story short... When it was time to eat, they ignored what I told them, because a doctor who never knew me before that day had ordered something different.  I argued with the nurse... So what's going to happen is that my blood sugar is going to go as high as the sky.  Do you disagree?  "No."  And this doctor had known me for minutes when he made this order, but I've been treating my diabetes for 20+ years.  Do you think he knows more about what insulin I need than I do?  "No, sir."  Then give me the correct dose of what I need.  "I can't because I have to do what the doctor says, no exceptions."  So says the gov't.  There's a long story there, but you get the point.

Why is healthcare so ridiculously expensive?  In large part because gov't has volumes upon volumes of rules that are imposed.  And of course, that gov't control applies to most industries in this country.  THAT is Corporatism in action.

In a Capitalist world, hospitals and doctors offices would do what serves the customer's interest.  And they could make common sense adjustments that meet the needs of the patient.  And while it's true that this kind of flexibility could lead to mistakes, the onus would be on the provider to be smart enough to avoid them, instead of throwing their hands up and doing something they know is wrong because they risk regulatory consequences otherwise.

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## The Gold Standard

> The difference between Capitalism and Corporatism has nothing to do with who OWNs businesses and everything to do with who CONTROLs them.


It has everything to do with who owns them. A property owner is the supreme authority regarding the use of that property, business, hospital, whatever. If the government is the supreme authority, they are acting as the owner, even if they don't legitimately own it.

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## Spikender

We have monopolies under our current Fascist system. As mentioned before, monopolies would have a harder time existing in a true free market since there are no Government regulations limiting who can enter a particular market. We have monopolies, several of them, under our current Government, such as the media, agricultural, telecommunication, automotive, and other monopolies. The hopes of ever having real competition enter these domains without Government aid from our tax dollars is impossible with the high costs and regulations that each of these markets have. The Internet makes it a bit easier to compete in the media space, but you'll have to let me know when you can print wheat.

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## Mikefive

> It has everything to do with who owns them. A property owner is the supreme authority regarding the use of that property, business, hospital, whatever. If the government is the supreme authority, they are acting as the owner, even if they don't legitimately own it.


That's fair.  But you're going to have a hard time convincing someone going down that road, unless they're really open minded.  Point taken.

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## Mikefive

> We have monopolies under our current Fascist system. As mentioned before, monopolies would have a harder time existing in a true free market since there are no Government regulations limiting who can enter a particular market. We have monopolies, several of them, under our current Government, such as the media, agricultural, telecommunication, automotive, and other monopolies. The hopes of ever having real competition enter these domains without Government aid from our tax dollars is impossible with the high costs and regulations that each of these markets have. The Internet makes it a bit easier to compete in the media space, but you'll have to let me know when you can print wheat.


It's arguable that there are no monopolies in a free market.  Or at least not for long.  Now gov't OTOH is the purest form of monopoly.

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## osan

> I'm confused as too why Ron Paul and Libertarians say there is a system of corporatism, not capitalism.
> 
> "Capitalism is an economic system based on private ownership of the  means of production and the creation of goods and services for profit."
> 
> This  is quite clearly what we have in the majority of the Western world. You  can argue that the current system is closer to corporatism, but you'd  be missing the point entirely - corporatism values the rights of the  collective over the rights of the individual. In corporatism,  individuals exist only insofar as they exist as members of a group.
> 
> At  least in America, corporations are treated as extensions of the  individual. In fact, they are given all the same rights as individuals,  not a set of individual "corporation rights".



I would begin by registering my objection to your use of the term "corporatism".  To me it is a redundant word, given we already have "fascism".  I am not sure why people use it.  To my eyes they are interchangeable, which raises the question of why "corporatism" exists in the first place.  I think we should use "fascism".  It has an established history, meaning, and to my ears more closely reflects the hard edges of the reality it describes.  "Corporatism" sounds so wishy-washy; innocuous even.

So hows about we start off by using the more appropriate term and work from there?

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## Mikefive

> I would begin by registering my objection to your use of the term "corporatism".  To me it is a redundant word, given we already have "fascism".  I am not sure why people use it.  To my eyes they are interchangeable, which raises the question of why "corporatism" exists in the first place.  I think we should use "fascism".  It has an established history, meaning, and to my ears more closely reflects the hard edges of the reality it describes.  "Corporatism" sounds so wishy-washy; innocuous even.
> 
> So hows about we start off by using the more appropriate term and work from there?


I agree 100% with paragraph 1.

However, if your goal is to change hearts and minds, saying "I don't like your word, YOU should change to my word" while factually correct, starts the discussion off with a confrontational tone that will turn people off instead of opening doors to persuasion.  It's a word.  That's all it is.  As with GoldStan who corrected me about property ownership, it's always better to start where THEY are and nudge them in your direction and try to make a little progress with them than to lecture them in more advanced ways and lose them.

Just my O.

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## osan

> I agree 100% with paragraph 1.
> 
> However, if your goal is to change hearts and minds, saying "I don't like your word, YOU should change to my word" while factually correct, starts the discussion off with a confrontational tone that will turn people off instead of opening doors to persuasion.  It's a word.  That's all it is.  As with GoldStan who corrected me about property ownership, it's always better to start where THEY are and nudge them in your direction and try to make a little progress with them than to lecture them in more advanced ways and lose them.
> 
> Just my O.


I take your points well, but when the error is as basic as this, I am not sure what else there is to do but to point it out.  Words are almost never "just" words.  Words are important and one of the tricks some people use to alter an argument is to change their tack by employing a different term.  "Fascism" has a well-earned ferocity about it.  "Corporatism" is like a pussy-word.  It just seems so mushy and poofy and its use seems to soften the reality the things being discussed, softening it into a seemingly far less dire truth. You almost want to put your tongue on it and do obscene things.  

Use of "fascism" leaves little room for doubt in terms of the hazards and horrors of that which is being discussed.

In this case, a rose by any other name is a betrayal to the purpose at hand.

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## Ronin Truth

AKA Fascism

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## Mikefive

> I take your points well, but when the error is as basic as this, I am not sure what else there is to do but to point it out.  Words are almost never "just" words.  Words are important and one of the tricks some people use to alter an argument is to change their tack by employing a different term.  "Fascism" has a well-earned ferocity about it.  "Corporatism" is like a pussy-word.  It just seems so mushy and poofy and its use seems to soften the reality the things being discussed, softening it into a seemingly far less dire truth. You almost want to put your tongue on it and do obscene things.  
> 
> Use of "fascism" leaves little room for doubt in terms of the hazards and horrors of that which is being discussed.
> 
> In this case, a rose by any other name is a betrayal to the purpose at hand.


Eight years ago, I didn't even know what the word fascism meant.  But it sounds "communist" scary.  Had you brought your argument to me back then, I would've probably ignored you after that.

However, that being said, I know nothing about your delivery or how you communicate.  So if your method works, that's great!  In fact, going straight to the truth is more expedient than my method.  

But in my way of communicating--or perhaps with my audience--I turn people off by going directly to the truth.  So I've taken up a gentler approach.  Maybe that's wrong, but that's what seems to work the best for me.

But I'd rather do it your way for sure!

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## Dr.3D

I read this thread and it makes me wonder how it feels to have been played by a Harmonica.

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## osan

> Eight years ago, I didn't even know what the word fascism meant.  But it sounds "communist" scary.  Had you brought your argument to me back then, I would've probably ignored you after that.
> 
> However, that being said, I know nothing about your delivery or how you communicate.  So if your method works, that's great!  In fact, going straight to the truth is more expedient than my method.  
> 
> But in my way of communicating--or perhaps with my audience--I turn people off by going directly to the truth.  So I've taken up a gentler approach.  Maybe that's wrong, but that's what seems to work the best for me.
> 
> But I'd rather do it your way for sure!


I would not call your way "wrong".  A method's utility turns on the result is produces.  If you're getting the result you want, far be it for me to tell you to do otherwise.  I was speaking in a general voice, and not so much to you personally.

The question of direct v. indirect modes of addressing people and issues is in some ways interesting.  I am a strong advocate of directness.  I grew up in the martial tradition of Bujutsu, the art of the bushi (samurai).  While I hold the philosophies engendered therein, one of the elements to which I call "bull$#@!" is the pathological aversion that the Japanese have for direct communication.  If it works for them, then have at it, but I am not of that mind with most things.  One of the things to which I strongly object, however, is the habit of some Americans (usu. of a "liberal" personality) to revere this indirect mode, whereas on the other hand those same people are fond of deeming Americans as rude, uncultured, boorish, unsophisticated, and so forth.  But I digress.

Anyhow, clear and direct communication is demonstrated in my experience to be almost universally superior to the muted indirection that is so popular in some cultures.  The claim that "[we] just don't understand" is bull$#@!.  It is a beautiful mode, but in many circumstances it fails miserably in its ability to affect clear, correct, complete, and concise communications.  Note how communications in medicine, aerospace, and military operations opts for direct modes, wholly shunning the touchy-feely.  There is good reason for this.  As for me, I like getting to the bottom of an issue, saving the oblique approaches for situations such as when attempting to get laid. 

Use that which works best for you.

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## jmdrake

Let me break it down for you.  In a true free market "hands off" system, you don't have the government picking winners and losers.  You don't have corrupt banks getting bailed out.  You don't have domestic toy companies being destroyed by regulation designed to favor lead paint importer Mattel.  You don't have medicinal marijuana banned while killer drugs and drugs that make people killers are approved by the FDA.

Or let me ask you a question.  Do you considers communist China to be capitalist?  Because there is private ownership in communist China.




> This argument seems a wee bit No True Scotsman, if I'm honest.
> 
> Laissez-faire  capitalism is pretty idealistic by any standard. It's basically  assuming that in a free market, nobody will even have the idea of  establishing a monopoly. Furthermore, I fail to see how corporatism and  such oligarchy-esque systems aren't just different forms of capitalism.  Sure, the individual is no longer the most powerful and basic entity and  the definition of "private" ownership has changed, but it's just  capitalism under a different name.
> 
> Regardless, it seems that this  argument could go on forever for a simple reason - it comes down to  which form of capitalism we think is best, and therefore which one we  will say is the "true" form of capitalism. But we'd be missing the  point.
> 
> "Capitalism is an economic system based on private  ownership of the means of production and the creation of goods and  services for profit."
> "Corporatism, also known as corporativism, is  the sociopolitical organization of a society by major interest groups,  or corporate groups, such as agricultural, business, ethnic, labour,  military, patronage, or scientific affiliations, on the basis of common  interests."
> 
> ...

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## Mikefive

> Laissez-faire  capitalism is pretty idealistic by any standard. It's basically  assuming that in a free market, nobody will even have the idea of  establishing a monopoly.


This statement is pretty ridiculous to me, since in real terms, the only TRUE monopolies are given that power by government.  See the IRS, the NSA, the BMV, etc.  

Maybe I don't understand your definition of monopoly.  Arguably, Cam Newton has a monopoly on Cam Newton's athletic skill.  But there are many different football player alternatives, so that doesn't qualify in my book.  Also arguably, Pepsi Cola has a monopoly on Pepsi products (because the gov't provides them patent protection).  But there are all kinds of other drink products and even cola products if you want to get more specific.  So that doesn't qualify to me.

Sure, you can argue that the inventor of ball point pens had a monopoly and charged a premium for them right out of the gate.  But a few months later, others were making similar enough products (that weren't so similar to violate their patent protection) which quickly lowered prices.  No problem there.

So your fear is that some giant oil company (as an example) will buy up all the competitors and raise prices?  However, high prices and profits ATTRACT other business men who can (fairly easily, really) create a similar business that can make a nice profit by charging better prices, which will pull customers from the Megalopoly Oil Co.  Look!  No more monopoly and prices return to normal.

Yes, large corporations can use economies of scale to lower their costs.  But at the same time, massive companies also become more bureaucratic and struggle to change as the market changes.  Smaller companies are the opposite.  Each has advantages and disadvantages, so there's reasons and room for both in the market place.

Monopolies can exist in the free market.  But not for long, because the market adapts.  So I don't really view them as a problem.  Now gov't on the other hand... There's where the purest monopolies exist.

I recognize that I'm reading a lot into two sentences.  So can you expound a little?

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## FreeMarkets

Corporatism is just another form of socialism. While a majority of the populace in a purely democratic socialist system can suppress (i.e., steal from, coerce etc.) the remainder, in a purely corporatist system, this power lies in the hands of a few large corporations.

Capitalism is completely opposed to corporatism, democratic socialism or any other type of socialism. Capitalism stresses free markets and voluntaryism, and thus is opposed to an all-powerful state that can impose regulations or taxes. It does not matter whether such an all-powerful state is ruled by the majority or mostly influenced by the interests of a few major corporations.

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## Ronin Truth

*corporatism vs capitalism

*About 102,000 results (0.43 seconds) 

https://www.google.com/?gws_rd=ssl#q...+vs+capitalism

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## NorthCarolinaLiberty

> I'm confused as too why Ron Paul and Libertarians say there is a system of corporatism, not capitalism.


You're not confused at all.  You're just being disingenuous.

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## Natural Citizen

> So hows about we start off by using the more appropriate term and work from there?



Ben Swann mentioned the phenomenon in a relevant way that isn't often aknowledged, Ithought. 

Understanding Fascism - Collectivism vs. Individual Rights...





That said, mercantilism is what is parading under the illusion of capitalism at the moment.

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## Jerry C

Because there a significant difference between a system where business succeed or fail based on their own merits and how well they serve and please their customers and a system where businesses succeed based on how many lobbyists they send to Washington. One system is based on the free exchange of goods and services and the other is based on bribery, fraud and coercion.

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## oyarde

Capitalism is practiced on my place .

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## Danke

> Capitalism is practiced on my place .


We know.

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## AZJoe



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## nulledplug

> Here is a couple of economic/political philosophy flash cards:
> 
> Capitalism - Your own risk, your own reward
> 
> Corporatism(fascism) - Socialized risk, privatized profit
> 
> Which is closer to what we have?


yes

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