What Corporatism Actually Is

"The fundamental idea both of guild socialism and of corporativism is that every branch of business forms a monopolistic body, the guild or corporazione. This entity enjoys full autonomy; it is free to settle all its internal affairs without interference of external factors and of people who are not themselves members of the guild. The mutual relations between the various guilds are settled by direct bargaining from guild to guild or by the decisions of a general assembly of the delegates of all guilds. In the regular course of affairs the government does not interfere at all. Only in exceptional cases, when an agreement between the various guilds cannot be attained, is the state called in.

"[The guild socialists ... aimed at self-government of each branch of industry; they wanted, as the Webbs put it, “the right of self-determination for each vocation.”  ...[T]he guild alone should have jurisdiction over its internal affairs and the government should restrict its interference to those things which the guilds themselves cannot settle.

"However, within a system of social cooperation under the division of labor [i.e., the market economy] there are no such things as matters of concern only to those engaged in a special plant, enterprise, or branch of industry and of no concern to outsiders. There are no internal affairs of any guild or corporazione the arrangement of which does not affect the whole nation. A branch of business does not serve only those who are occupied in it; it serves everybody. If within any branch of business there is inefficiency, a squandering of scarce factors of production, or a reluctance to adopt the most appropriate methods of production, everybody’s material interests are hurt.... In the market economy the entrepreneur in making ... decisions is unconditionally subject to the law of the market. He is responsible to the consumers. If he were to defy the orders of the consumers, he would suffer losses and would very soon forfeit his entrepreneurial position. But the monopolistic guild does not need to fear competition. It enjoys the inalienable right of exclusively covering its field of production. It is, if left alone and autonomous, not the servant of the consumers, but their master. It is free to resort to practices which favor its members at the expense of the rest of the people."

—Ludwig von Mises, Human Action

TGIF: Trump, Carrier, and the Corporate State

Should free-market advocates applaud the deal Donald Trump brokered to keep some Carrier jobs from being transferred to Mexico? I believe the right answer is no.

Read the rest at The Libertarian Institute.

TGIF (The Goal Is Freedom) appears on Fridays. Sheldon Richman, author of America's Counter-Revolution: The Constitution Revisited, keeps the blog Free Association and is executive editor of The Libertarian Institute. He is also a senior fellow and chair of the trustees of the Center for a Stateless Society and a contributing editor at Antiwar.com. Become a Free Association patron today!

TGIF: Libertarians Must Get History Right

Understanding history as best we can is important for obvious reasons. It’s particularly important for libertarians who want to persuade people to the freedom philosophy. In making their case for individual freedom, mutual aid, social cooperation, foreign nonintervention, and peace, libertarians commonly place great weight on historical examples most often drawn from the early United States. So if they misstate history or draw obviously wrong conclusions, they will discredit their case. Much depends therefore on getting history right.

TGIF: The Pope Dabbles in Economics

The pope’s concern with the poor and excluded is well-placed. We should not tolerate their condition or its causes. But what the poor and excluded need are freedom and freed markets — really free markets, not “the prevailing economic system” — so they may be liberated from the oppression that holds them back.

Read it here.

Op-ed: Bangladeshi Workers Need Freed Markets

"Pro-sweatshop" is not a libertarian position. See why here.

TGIF: Where Free-Market Economists Go Wrong

The freedom philosophy is a radical idea that looks ahead, rather than to some mythical golden era or Panglossian present. Every time we pass up an opportunity to make this point, we alienate potential allies….

Read TGIF here.

Op-Ed: JPMorgan Lesson: End Government Bank Guarantees

It’s widely believed that JPMorgan Chase’s recent $2 billion–plus loss proves we need the comprehensive banking regulation called for by the 2010 Dodd-Frank law.

That belief is wrong.

Read the rest of the op-ed here.

TGIF: Forgotten Critic of Corporatism

Frank acknowledgments about the Gilded Age from an unexpected source. Read it here.

Op-ed: An Echo, Not a Choice

My take on Mitt Romney and the upcoming election.

With Mitt Romney’s sweep of Tuesday’s primaries, he will almost certainly be President Barack Obama’s Republican opponent in November. Romney has vowed to make the economy the chief issue against Obama, and he is sure to portray the president as an enemy of free enterprise in order to draw a contrast with himself. How fit is Romney’s claim to be a champion of economic freedom?

TGIF: Can Mutually Beneficial Exchanges Be Exploitative?

The great thing about competitive markets is not that marginal utility sets prices, but that rivalry among sellers drives prices below the level that approximates many people’s marginal utility. This produces a consumer surplus. (How far below is governed by producers’ subjective opportunity costs, including workers’ preference for leisure.) We all have bought things at a price below that which we were prepared to pay. . . . In a manner of speaking, competition socializes consumer surplus.

 On the other hand, in the absence of competition a coercive monopolist is able to charge more than in a freed market, capturing some of the surplus that would have gone to consumers. That’s a form of exploitation via government privilege.

Read the rest of TGIF here.

Recent Scribblings

TGIF: Stigmatizing Resistance to Authority
Op-ed: Barack Obama: Corporatist

Are They Laughing at Us?

"Although Mr. Obama has made a point of not accepting contributions from registered lobbyists, a review of campaign donations and White House visitor logs shows that special interests have had little trouble making themselves heard. Many of the president’s biggest donors, while not lobbyists, took lobbyists with them to the White House, while others performed essentially the same function on their visits." --New York Times

Latest Writings

TGIF: “Capitalism, Corporatism, and the Freed Market”

FFF op-ed: “Are Obama and Netanyahu Trying to Push Iran toward a Nuke?”

TGIF: Putting Bureaucracy First: Rachel Maddow’s Progressivism

Today’s TGIF examines the political thought of the likes of Rachel Maddow:

Progressives today say people should come before profits. Now in a privilege-ridden corporate state, that’s a worthy goal, though Progressives have no clue how to achieve it. How nice it would be if they were equally committed to putting people before bureaucracy. Here they fall down rather badly because their signature ideas would subordinate regular people to the dictates of the power structure.

Read it here. Reason.com is now posting TGIF. You can see the latest here.
Some other recent writings:
TGIF: “Back to Basics” – No volition, no discourse. No discourse, no denying volition. Ergo volition.
Op-ed: “What Immigration Problem?”

TGIF: End the IMF

The IMF has fostered long-term dependency, perpetual indebtedness, moral hazard, and politicization, while discrediting market reform and forestalling revolutionary liberal change.

Read the rest of TGIF: End the IMF here.