Alina Stefanescu Coryell has a killer post that summarizes the unholy relationship between corporations and governments around the world. Looking at the work of one Ian Bremmer, Stefanescu Coryell tackles a global phenomenon that is starting to make Marxist metanarratives look vaguely true (thesis-antithesis-synthesis, at least).
People who say that either full-on capitalism or full-on statism is utopian should read this and decide whether the world needs a little more utopianism. What's in between ain't healthy at all. Welcome to state capitalism. A sliver:
One of the critical-- and critique-worthy-- features of state capitalism is this close relationship between the government of a country and its putative entrepreneurs. This client-patron relationship threatens to unravel the performance of global markets. Since commercial decisions are often left to political bureaucrats who lack experience in managing commercial operations, their decisions frequently make markets less competitive and productive. There is no way for markets to fix these irregularities when distorted by the power of political patronage and the competitive advantage offered by state subsidies. Motivations underlying investment decisions become political rather than economic. As a result, state capitalism adds costs and inefficiencies to production by injecting politics and corruption into market operations. The client-patron relationship encourages businesses to put greater stock in maintaining current regimes and backing an expanded, often dangerous perception of "national interest" and foreign policy goals.
Under state capitalism, economic entrepreneurship is replaced by political entrepreneurship. Unfortunately, one need only take a walk over to Congress to observe the tawdry power of political entrepreneurs in even the American system.
We aren't just talking about Venezuela or China. GM?, GE?, nationalized banks?, government healthcare?, etc., etc. The dynamic America, one in which free entrepreneurs created new systems of value as fast as it could destroy and replace old power-centers, is moving rapidly towards sclerotic corporatism. Whether we're talking about the rightwing military-industrial complex, or the green-and-agribusiness-union-bailout-bank-takeover mob on the left, we are moving into an incentive system as perverse as it is byzantine. Brave. New. World.