How Did American Capitalism Mutate Into American Corporatism? ⋆ Brownstone Institute

🌈 Abstract

The article discusses the evolution of the relationship between the government and the private technology sector, particularly how the government has become a major customer of tech companies and how this has led to the rise of "corporatism" - a blurring of the lines between the public and private sectors.

🙋 Q&A

[01] The 1990s and the Perception of Government Technology

1. What was the common perception of government technology in the 1990s and early 2000s?

• The government was seen as technologically backwards, still using outdated systems like IBM mainframes and large floppy disks, while the private sector was rapidly advancing with new technologies like the web, apps, search tools, and social media.
• There was a sense of techno-optimism that the private sector would outpace and make the government obsolete.

2. How has this perception changed over time?

• The opposite has happened - the government has become a major customer of the services provided by large tech companies, with Amazon, Microsoft, Google, and others earning billions in government contracts.
• The government is now a key driver of the tech industry, particularly in areas like cloud computing and AI.

[02] The Blurring of Public and Private Sectors

1. How has the relationship between the government and the private tech sector evolved?

• The private tech sector that was once seen as libertarian and independent from the government has become deeply intertwined with it.
• Tech companies now have a large presence in the Washington D.C. area, with major campuses and offices, and they collect billions in government revenue.
• The government has become a major customer, if not the main customer, of the services provided by large tech and social media companies.

2. What are the implications of this blurring of the public and private sectors?

• It has led to the rise of "corporatism" - a system where private property ownership and cartelized industry primarily serve the interests of the state, rather than the general public.
• The old distinctions between the public and private sectors have become so blurred that it is difficult to tell the "good guys" from the "bad guys" in the current landscape.

[03] The Broader Implications of Corporatism

1. How does corporatism extend beyond the tech sector?

• Similar dynamics can be seen in the pharmaceutical industry, where there is no real distinction between the interests of the FDA/CDC and large pharmaceutical companies.
• The agricultural sector is also dominated by cartels that have driven out family farms, with government subsidies and policies determining what is produced.

2. What are the broader implications of this corporatist system?

• It has led to a decline in economic prosperity for the many and riches for the few, as the focus has shifted from serving the general public to serving the powerful masters in the government.
• It has also enabled increased surveillance and control over individuals, as the corporatist complex has intruded into every aspect of our lives, from our food and medicine to our media and information flows.

[04] Challenges in Addressing Corporatism

1. What are the challenges in addressing the issue of corporatism?

• The problem is intellectually and philosophically complex, as it transcends the traditional debates between capitalism and socialism.
• It is also politically and juridically challenging to deal with, as the corporatist complex has become deeply entrenched and has the power to purge serious dissent at all levels of society.

2. How did this situation come about?

• The article suggests that it started with seemingly innocuous government contracts, such as public schools buying computers from Microsoft in the 1990s, which gradually led to the creation of the vast corporatist machinery that now dominates our lives.