Capitalism vs. Corporatism

Sheldon Richman over at the Freeman online wrote a great essay asking the simple question, is American "capitalism" really so much better than European "socialism"? He summarizes his view of American economics in this way:

What counts is what the system really is. And it’s nothing like an open, competitive market void of government privilege. It’s a corporatist system in which the liberty and property of regular people are subordinated in myriad ways to the interests of a mainly business-oriented ruling elite. (Do we need further evidence than the “socialist” Barack Obama’s coziness with Wall Street — rhetoric notwithstanding — and his generous gift to the health insurance industry?) Yes, we have some degree of freedom, but it is freedom circumscribed by a system of rules and regulations aimed at producing certain broad economic outcomes for the well-connected. At the federal, state, and local level, money has always talked. Intervention is of course defended on moral grounds (say, protection of consumers and workers), but behind the scenes lurks an economic interest. “Baptists and bootleggers” are ubiquitous.

This is what I appreciate about the libertarian, or classical liberal, perspective. The fundamental difference between "conservative" and "liberal" in this country seems to have to do with where the power structure should be located. The libertarian has the courage to ask, why should the power structure have a central location at all?

This is also why Republicans always sound so hypocritical. They talk about economic liberty, but what it really comes down to is more power for corporations, which is not better than more power for the government (in fact, sometimes it is equivalent). What we need is a true capitalist party, rather than a corporatist party.