Forum Post: We do not live in a capitalist country and you need to know what this system really is

'Corporate Socialism'

By Ralph Nader

Thursday, July 18, 2002; Page A29

The relentless expansion of corporate control over our political economy has proven nearly immune to daily reporting by the mainstream media. Corporate crime, fraud and abuse have become like the weather; everyone is talking about the storm but no one seems able to do anything about it. This is largely because expected accountability mechanisms -- including boards of directors, outside accounting and law firms, bankers and brokers, state and federal regulatory agencies and legislatures -- are inert or complicit.

When, year after year, the established corporate watchdogs receive their profits or compensation directly or indirectly from the companies they are supposed to be watching, independent judgment fails, corruption increases and conflicts of interest grow among major CEOs and their cliques. Over time, these institutions, unwilling to reform themselves, strive to transfer the costs of their misdeeds and recklessness onto the larger citizenry. In so doing, big business is in the process of destroying the very capitalism that has provided it with a formidable ideological cover.

Consider the following assumptions of a capitalistic system:

1) Owners are supposed to control what they own. For a century, big business has split ownership (shareholders) from control, which is in the hands of the officers of the corporation and its rubber-stamp board of directors. Investors have been disenfranchised and told to sell their shares if they don't like the way management is running their business. Nowadays, with crooked accounting, inflated profits and self-dealing, it has proven difficult for even large investors to know the truth about their officious managers.

2) Under capitalism, businesses are supposed to sink or swim, which is still very true for small business. But larger industries and companies often have become "too big to fail" and demand that Uncle Sam serve as their all-purpose protector, providing a variety of public guarantees and emergency bailouts. Yes, some wildly looted companies that are expendable, such as Enron, cannot avail themselves of governmental salvation and do go bankrupt or are bought. By and large, however, in industry after industry where two or three companies dominate or presage a domino effect, Washington becomes their backstop.

Cont.,

http://www.essential.org/features/corporatesocialism.html