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Comment by bvaldivielso | Hacker News Reader

Could you elaborate how? Is this specific to capitalism? or is cronyism the logical conclusion of any societal system that lasts for a while? For example, and just to choose an example that is obviously not capitalist, would you say cronyism wouldn't happen in a communist society? As far as I understand, it very much happened in the URSS. I'm not bashing on communism, just trying to understand your statement.

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Capitalism rewards owning capital heavily, so it naturally trends towards wealth concentrating. The argument against this is to regulate it, but overtime, you'll always end up trending towards capital becoming more powerful then the regulators. You'll always have Capital just buying the regulators, basically. You can have "resets" (like the Great Depression and WWII) that maybe fix this a little bit temporarily, but it'll end up going back to cronyism again as power (i.e. Capital) starts concentrating again.

Cronyism can exist in an economic system where there are positions of power. However, if you were to limit position of power, I believe you could make an economic system more resilient to cronyism. Obviously systems like the USSR had positions of extreme power so it was very prone to cronyism.

How do you create a society that limits positions of power?

The US Constitution tries to do that by pitting different groups in power against each other, diffusing their power and forcing them to cooperate to achieve anything. And then adding a Bill of Rights specifically limiting the power government has over the individual.

Do you have a better idea?

The US system isn't too bad, the main problem with it is capitalism. Under capitalism, you can't have a true democracy. The rich can always influence the public (Manufacturing Consent) or outright buy representatives. You have to keep wealth more distributed to avoid this, which means we need a system that doesn't so heavily reward and enable accumulation of wealth. I like many of the ideas of Mutualism [0]. Primarily the emphasis on credit unions, the limits on private property, and worker democracy.

[0] https://en.wikipedia.org/wiki/Mutualism_(economic_theory)

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