During the current election cycle, perennial Republican
hopeful Ron Paul has garnered significant attention presenting himself as an
alternative to the political establishment. Depending on their level of
fanaticism, diehard Paul supporters will tell you that he is an opponent of the
“new world order,” state-ism or corporatism. One phrase associated with his
reactionary libertarian ideology has gained particular traction: “crony
capitalism.”
The implication of this outlook is that capitalism in its
“natural” state is the solution to society’s problems but has been corrupted by
greedy individuals deviating from the ideals of the free market. Instead of
fighting for a new system, the libertarians argue, we should eliminate all
government handouts and monopolistic entities that infringe on the purity of
economic competition. This line of reasoning ignores the fundamental tendencies
of capitalism as well as the nature of the state, serving only to derail the
growing people’s movement against the 1% and their system of exploitation and
oppression.
Monopoly is inevitable under capitalism
One of the basic laws of the capitalist system is the
tendency to form monopolies, which arises from what Marxists call the
concentration and centralization of capital—an inevitable result of capitalist
competition. This process is greatly sped up during crises of overproduction,
when companies enjoying the greatest economies of scale and lowest labor costs
survive while less profitable companies frequently go bankrupt.
In order to preserve the stability of the capitalist system,
the capitalist state has increasingly had to step in to limit this process,
especially when the companies going under are judged “too big to fail.”
However, this leads to even greater capital consolidation.
For example, in the middle of the 2008 financial collapse,
Bank of America acquired Countrywide Financial and Merrill Lynch, which would
have otherwise gone bankrupt, for $2.5 billion and $50 billion, respectively.
If we somehow returned to the era of small-scale competition as Ron Paul
advocates, the process of capital consolidation would simply restart and lead
us back into the exact same situation.
Libertarians are astounded that wealthy bankers and CEOs
constantly exert influence on and trade favors with elected officials. This
practice, they argue, should be made illegal to take the “crony” out of crony
capitalism. The underlying assumption is that the state is an independent
entity, standing above the contradictions of the society it governs. In fact,
the state is a tool for the rule of one class over another.
Economic inequality means political inequality
Whenever society’s wealth is concentrated in the hands of a
tiny minority, an inherent feature of capitalist society, the 1% will naturally
use that wealth to direct the political process. For members of the capitalist
class, the costs associated with the maintenance of their state—including
lobbying and campaign contributions—are worthwhile investments in the stability
of their system.
Look forward, not backward
Ron Paul and other libertarians survive on nostalgia for a
golden age of capitalism they insist existed sometime in the past. Instead of
trying to turn back the wheels of time, we need to adopt a forward-looking
perspective and fight for a society free of crises and cut-throat competition
leading to more monopoly, more imperialist wars, more inequality and all the
other evils of this rotten system. We need to fight for a society based on the
power of working people and the abolition of all forms of exploitation.
