Beware of the dark side of capitaism: Corporatism

Stories like this one underscore why privatization is not the cure-all its proponents claim.

I'll be the first to admit that capitalism is a great system. When it's doing what it does best, it's incomparable.

But, as with all isms it carries the seeds of its own failures within its strengths.

Private companies that seek government contracts resort to scratching the back of public officials, and if they're lucky, they may get a president who supports their efforts with no bid contracts.

The upshot is this: When private companies gain government favor without the necessary competition of the marketplace, then we get a system not unlike that of the Third Reich---corporatism. A corporatist state is one where corporate interests become one and the same with the state and mutual backscratching for business is the norm rather than the exception. Here's a lengthy definition of corporatism.

Privatization of government functions is, to be punny, tricky business. Some government functions should never be privatized because they involve such heavy policy matters that direct government oversight is necessary to insure that the sovereign (read: the people) has a say.

Capitalism is great, but when business seeks favor through patronage rather than through competition, then we're not dealing with capitalism anymore---it becomes corporativism. That's nothing more than a polite way to say fascism.