Overcoming the Corporatist Economy, Restoring the Market Economy

Is it really acceptable for our economic system to undermine the environmental sustainability of the planet? The same economic system that time and again falls victim to financial collapse and causes ever-increasing inequality?



It is very clear that something is seriously wrong – demonstrated not only by the climate, finance, and inequality crises of recent years, but also by the presence of new economic structures in which the rules are dictated by power and money.



Clearly, this economic order can no longer be identified as a market economy, the central drivers of which are our needs and preferences. Instead, I call this new economic order the ‘corporatist economy’. A small number of large multinational corporations are gaining more and more control over society. Instead of competing for the favour of consumers, corporate oligopolism dramatically reduces competition. Rather than being guided by consumer demand, big business manages and manipulates our tastes and preferences. In consequence, competition over goods and services for the benefit of consumers has become less important than financial power and market control.



With a few huge corporations controlling production, the variety of products available is severely restricted. Small businesses and local initiatives find themselves pushed up against the wall. Furthermore, these large multinationals’ purely profit-focused approach seriously hampers the sustainable and equitable development of our societies.



So what are our options? There is very little that we can do as individuals to fight this trend. While buying local does of course help, this is clearly not enough to fend off the big companies. Often, their market power has already led to dramatic market consolidation, thus severely limiting our options as consumers. We often find ourselves with no choice but to buy from these companies.



Instead, we have to face up to big business on equal terms. The state alone has the ability to restore the market economy. Of course, companies shy away from competition and prefer policies that do not tear them out of their comfort zones. But if we want to counter the negative effects of the corporatist economy experienced over recent years, we desperately need state regulation in order to turn back the clock to real competition – competition that in the end benefits us, the consumer.



Faced with global corporations, individual states are often too small to really make a difference. The global web of connections (both finance and production) creates systems and symbioses which can no longer be tackled at a national level alone. Moreover, with the advent of the European internal market, individual member states are no longer in any position to engage with major companies on an equal footing.  This is why going it alone may not be enough – and why we need a strong EU. As long as legal frameworks are established at a national level while transnational companies operate across national borders, our interests as citizens will be ignored. If we want to defend our sovereignty as consumers and citizens, we need to make sure that big business faces competition. Genuine sovereignty as regards economic policy can only be achieved if we push through legislation to counter the ‘corporatist economy’. We need to work together on legal frameworks that are capable of effectively setting a limit on the grip of global corporations.



This is also important from an environmental point of view: when all that matters is shareholder profits, environmental issues become less relevant. Any attempt to establish environmental guidelines for the economy will fail in the face of large-scale lobbying. Small regional enterprises and fair trade will be marginalised. Innovative environmental solutions have little chance of getting off the ground as long as markets are controlled by a handful of buyers in large commodities markets and all-powerful global trading centres. The only way to achieve a sustainable society that serves the wellbeing of all is through a return to a market economy. Similar to the ‘progressive movement’ in the USA at the turn of the last century, we need to close ranks against an economic system that serves the few to the detriment of the many.