Corporatism

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“”What I have described [in prior five chapters of the book] is a civilization - our civilization - locked in the grip of an ideology - corporatism. An ideology that denies and undermines the legitimacy of the individual as the citizen in a democracy. The particular imbalance of this ideology leads to a worship of self-interest and a denial of the public good. The quality that corporatism claims as its own is rationality. The practical effects on the individual are passivity and conformism in the areas that matter and non-conformism in the areas that don't.

—John Ralston Saul, The Unconscious Civilization [1]

Corporatism is a political, economic and social view that emphasizes the individual's belonging to socially, economically, professionally, ethnically, nationally or in some other way defined social group - a "corporation" - in which common interests should form the basis for decisions on various issues (akin to collective bargaining). This ideology functions similarly to structural functionalism in sociology, where norms, customs, and institutions are considered to have specific functions that make society, the larger whole, function in a certain way. That is, corporatism views the society being the human body, which has these various social groups/corporations to act as its organs. Or to put in another way, Corporatism is about the "power of advocacy groups".[2][3][4]:73[5][6]

Although corporatism comes in many flavors, historically corporatist rule has been primarily advocated by fascist movements, as well as by a number of conservative thinkers. This is due to their ideological opposition to both individualism and egalitarianism \- which they primarily associate with liberalism and socialism \- instead emphasizing difference, symbiosis, and consensus through mutual dependence.[7][4]:73[8] It also has, in a more pronounced economic sense, common expressions with reformist socialism.[9][10]

## Contents

* 1 History
* 1.1 Before Middle Ages
* 1.2 Middle Ages, the decline during industrial revolution and niche revival
* 1.3 20th Century to Present
* 2 Misconceptions about Corporatism
* 3 Types of corporatism
* 3.1 Fascist corporatism
* 3.2 Social corporatism
* 4 Issues
* 4.1 Economic issues
* 4.2 Haggler governance and inequality
* 4.3 Other problems
* 5 Instances
* 6 Notes
* 7 References

## History[edit]

### Before Middle Ages[edit]

The concept of corporatism had already been explored since the times of classical antiquity. In fact, “Karl Popper’s favoritest Greek” - Plato \- had outlined and advocated for what is now known as communitarian corporatism. Likewise, Aristotle too - in his work “Politics” - had been observed to have proposed a corporatist system, in which society is divided into natural classes and functional purposes.[11][12]:91

Subsequently, the Greek ideas of corporatism eventually bled over to Ancient Rome, where the decision makers and other sorts of thinkers began to formulate their own takes on corporatism. Notably, introducing the idea of political representation and dividing “functions” into divisional institutions called “collegia.”

Although the Western Roman Empire would ultimately fall, the religious movements in Europe would assimilate corporatist concepts from the Greco-Roman regions. In the early Middle Ages, corporatist systems were mostly contained within the religious orders and proponents of the Christian Brotherhood.

### Middle Ages, the decline during industrial revolution and niche revival[edit]

The more modern doctrine of corporatism has its roots in the trade guilds of the Middle Ages (i.e. "Corporation" by feudal European definition), where people of the same profession grouped themselves together, negotiated strict rules that would apply to all corporate members, and then sought recognition as a legitimate trade organisation by the crown. These guilds tended to be very conservative, favoring traditionalism and economical stability over technological and economic development -- latter which they saw as threat to their way of life. The guilds had a hierarchical structure, but the members often had organic ties to each other, working closely together. They regulated prices and production to suit the needs of society, being largely independent from the crown, even to the degree of protecting their corporate members from the crown. These guilds were gradually abolished before the advent of capitalism and economic liberalism, with their oblivion further accelerated by technological advancement, free trade and competition. [3][4]:73, 128-129

The idea of corporatism resurfaced gradually in far-right circles when syndicates became legalised in most western countries at the end of the 19th century. The idea is that worker syndicates and employer syndicates belonging to the same profession are grouped together into a trade corporation/organisation. Pope Leo XIII's 1891 encyclical titled "Rerum Novarum" is considered to have established the platform for corporatism in its opposition to both laissez-faire capitalism and socialism, with it's instructions to counter those two ideas by finding the "third way".[13][14] German Romantic philosophers in the 19th century - such as Max Scheler \- considered corporatism to be a good way to remedy the "social rootlessness" that was caused by industrialization and class conflicts.[15]

### 20th Century to Present[edit]

“”Now listen to the first three aims of the corporatist movement in Germany, Italy and France during the 1920s. These were developed by the people who went on to become part of the Fascist experience: (1) shift power directly to economic and social interest groups; (2) push entrepreneurial initiative in areas normally reserved for public bodies; (3) obliterate the boundaries between public and private interest -- that is, challenge the idea of the public interest. This sounds like the official program of most contemporary Western governments.

—John Ralston Saul, The Unconscious Civilization [16]

The spin towards a more fascistic direction to crystalize prior to World War I, through the contributions of Italian nationalist ideologues, such as Enrico Corradini, Alfredo Rocco, and Luigi Federzoni. They believed that the creation of organizations would lead Italy out of the long period of economic instability and wars, which would strengthen the country's expansionist pressure against external enemies. Another source of ideas was revolutionary syndicalism, coming from pre-war fascists such as Edmondo Rossoni. By their logic, World War I proved that the war effort was supported by the cooperation of business, the army and the government - with syndical trade being tightly controlled - and therefore nationalism can be characterized as a form of enterprise.[7] Fascism would eventually emerge through combination of Corporatism and Syndicalism, bringing back the mentality of the guilds into the 20th century.[4]:73,128-129

It was applied in modern times in most fascist states, but far from being independent or serving as counter-weight to the state, these trade organisations became largely directed by the state. Corporatists often argue that there was much more security and stability in these trade guilds before the advent of economic liberalism, which led to the creation of the proletariat during the 19th century.

## Misconceptions about Corporatism[edit]

First of all, Corporatism ≠ Corporatocracy; latter being correct term for "rule by business corporations and/or corporate interests". Corporatism is derived Latin corpus, corporis ('body'), while Corporatocracy is combination of "corporate" and Greek kratía (lit. "domination by"). Regardless, corporatism is frequently - and possibly deliberately - misidentified as "rule by companies" to 'prove' that all modern governments are fascist, ergo Bush did 9/11 or whatever other nonsense they're peddling.

## Types of corporatism[edit]

### Fascist corporatism[edit]

Corporatism is often associated with Italian fascism. In that meaning, Corporatism is the union of representatives of labor/trade unions, the government, and companies with the goal of creating a unified industrial policy which works towards the best interests of labor, management, and the government (in theory, the government represents society as a whole). In practice, the exact opposite occurred, with the government strong-arming labor into doing whatever the companies want, closing down independent unions and replacing them with state-run ones that were toothless.[7]

### Social corporatism[edit]

"Social corporatism" has sometimes been used to describe social democratic economic models, where both private property and labour interests are protected. While this has been used by some libertarians and communists, including Stalin, as "proof" that liberals are actually "deep cover fascists" (the communists under their theory of "social fascism"), it doesn't explain why Angela Merkel hasn't worn a toothbrush moustache, suspended the Bundestag, and bombed Greece yet. One famous example is Peronism, which has divided Argentinian politics ever since World War II ended.

## Issues[edit]

### Economic issues[edit]

From a economic POV, Corporatism's major flaw is that it stifles innovation, is less productive and otherwise lacking in flexibility compared to free-market capitalism.[4]:73 While corporatist arrangements can protect established industries from competition through favorable regulations, this has the effect that small startups may find it harder to compete on an uneven playing field. This thus discourages innovation and will entrench monopolies or oligopolies \-- which have their own sets of issues.[17][18]

Also, when faced to global businesses/multinational capitalism, it's hard to keep up an corporatist economic model. Multinational corporations generally originate from capitalist countries and thus often operate and grow outside the bounds of national corporatist agreements. This can cause problems, as if any of these entities want to establish their business in a corporatist country, they might ultimately find ways to avoid regulations or weaken local laws.[19][20] Examples of this happening include Sweden and Germany, which tried to retain corporatist elements, only face pressure from EU regulations, global competition, and automation. Many states in Latin America also had adopted corporatist policies mid-20th century, but neoliberal reforms and IMF pressures in the 1980s–1990s eroded them.[21][22][23]

### Haggler governance and inequality[edit]

In his book, "Corporatism and the Myth of Consensus", Roger Bobacka argues that one of the major faults of Corporatism is that in essence, its decision-making is not about "whoever makes the best reasoned argument", but to "whoever has the most persuasive argument." Meaning that in a corporatist system, whoever is the best haggler is most likely to control policy, regardless if they have any understanding or expertise in the matter they talk about, and that this individual has the power to bypass the parameter of consensus that is supposed to define corporatism.[24][note 1]

In addition, this conduct undermines democratic accountability. Corporatism often lets groups that aren't elected by voters have an official say in how policies are made, and as such, can weaken the power of regular people and the officials who are elected by them. This results in policies being made behind closed doors with little public oversight, with the interest groups (lobbyists and/or trade associations) working to shape laws in ways that help their members, often at the expense of the general public. Indeed, such close ties between state officials and powerful corporate actors can lead to nepotism, favoritism, and corruption. Therefore government contracts and policies may be awarded based on connections, not merit or public interest.

Thus in practice, corporatist systems tend to favor large, well-organized groups - especially big business - resulting in over-representation of elite interests. And as small businesses, marginalized communities and/or informal workers, who lack this sort of capacity for presentation, leads to unfairness in the economy and politics, which makes inequality worse.

### Other problems[edit]

In a corporatist system, the need for consensus can also lead to bureaucratic gridlocks, because they need agreement from many different groups with conflicting interests. This then makes it difficult to act fast during emergencies or update old policies. Also there is a risk that the compromise might result in policies are usually weak and don’t address the main problems effectively.

Corporatism - particularly the authoritarian/state-controlled variants - can also weaken labor and civic autonomy, with labor unions and civic organizations being either co-opted or controlled by the state. This undermines their independence and limits their ability to advocate for workers or the public.

## Instances[edit]

* "National Corporatism", Italy, 1922-1945, Benito Mussolini[4]:73
* "Country, Religion, Monarchy", Spain, 1923-1930, Miguel Primo de Rivera
* "National Socialism", Germany, 1933-1945, Adolf Hitler
* "National Syndicalism", Spain, 1936-1973, Francisco Franco
* "New State", Portugal, 1932-1968, Antonio Salazar
* "New State", Brazil, 1933-1945, Getulio Vargas
* "New Deal", United States, 1933-1945, Franklin Roosevelt[4]:73
* "Third Hellenic Civilization", Greece, 1936-1941, Ioannis Metaxas
* "Justicialist Party", Argentina, 1943-1955, Juan Perón[25]

## Notes[edit]

1. ↑ In a way, this partly explains how a corporatist platform can eventually start to change towards a authoritarian state, that is controlled by "charismatic strongman" dictator akin to Hitler, Mussolini or even Donald Trump.

## References[edit]

1. ↑ Saul, John Ralston (2012) [1995]. The Unconscious Civilization. Free Press. p. 186\. ISBN 9781439118603. Retrieved March 23, 2025.
2. ↑ Encyclopedia Britannica - corporatism ideology
3. ↑ 3.0 3.1 Wiarda, H. J. (2016). Corporatism and Comparative Politics: The Other Great "Ism". Taylor & Francis. ISBN 9781315481036
4. ↑ 4.0 4.1 4.2 4.3 4.4 4.5 4.6 Sheldon, Garrett Ward (2001). Encyclopedia of Political Thought. Facts On File, Incorporated. ISBN 9781438129242.
5. ↑ Kjaer, P. F. (2010). Between Governing and Governance: On the Emergence, Function and Form of Europe's Post-National Constellation. Bloomsbury Publishing. ISBN 9781847315694
6. ↑ Encyclopedia of Democratic Thought. (2003). Taylor & Francis. ISBN 9781136908569. Page 114
7. ↑ 7.0 7.1 7.2 Blamires, Cyprian P. (2006). World Fascism: A Historical Encyclopedia (2 Volumes). ABC-CLIO Inc. p. 150-151. ISBN 1-57607-940-6.
8. ↑ Micocci, A. (2012). Moderation and Revolution. Lexington Books. ISBN 9780739167182 Page 194
9. ↑ Corporatism and Fascism: The Corporatist Wave in Europe. (2017). Taylor & Francis. ISBN 9781315388892. Page 113
10. ↑ Del Roio, M. (2015). The Prisms of Gramsci: The Political Formula of the United Front. Brill. ISBN 9789004304185. Page 180
11. ↑ Adler, Franklin Hugh (2002). Italian Industrialists from Liberalism to Fascism: The Political Development of the Industrial Bourgeoisie, 1906-34. Cambridge University Press. p. 349\. ISBN 9780521522779. Retrieved March 22, 2025.
12. ↑ Pike, F. B., Stritch, T. (1974). The New Corporatism: Social-political Structures in the Iberian World. University of Notre Dame Press.
13. ↑ Corporatism and Fascism: The Corporatist Wave in Europe. (2017). Part I, Chapter 2: "Corporatism and political Catholicism". Taylor & Francis. ISBN 9781315388885
14. ↑ Encyclopedia of Politics: The Left and the Right (Volume I). (2005). SAGE Publications. ISBN 9781452265315. Pages 601-602.
15. ↑ Staude, J. R. (1965). Max Scheler: Philosopher, Sociologist, and Critic of German Culture (1912-1928). University of California. Page 284
16. ↑ Saul, John Ralston (2012) [1995]. The Unconscious Civilization. Free Press. p. 89\. ISBN 9781439118603. Retrieved March 23, 2025.
17. ↑ Sauter, W. (2015). Containing corporatism: EU competition law and private interest government. European Competition Law Review, 36(5), 187-193.
18. ↑ Xia, J., Yao, F. K., Yin, X., Wang, X., & Lin, Z. (2023). How Do Political and Nonpolitical Ties Affect Corporate Regulatory Participation? A Regulatory Capture Perspective. Business & Society, 63(7), 1639-1686. https://doi.org/10.1177/00076503231219687 (Original work published 2024)
19. ↑ Globalization or Corporatisation: Labor and Social Forces in the Global Political Economy by Jeffrey Harrod (International Studies Association, March 1998)
20. ↑ "Corporatism Goes Global" by Marina Ottaway published by Carnegie on September 1, 2001
21. ↑ Mailand, M. (2012). 3. Change and Continuity in Danish and Norwegian Capitalism: Corporatism and Beyond. In U. Becker, L. Noordegraaf-Eelens, L. Tsipouri & V. Stenius (Ed.), The Changing Political Economies of Small West European Countries (pp. 73-98). Amsterdam: Amsterdam University Press. https://doi.org/10.1515/9789048514540-004
22. ↑ Burki, S. J., & Edwards, S. (1995). Consolidating Economic Reforms in Latin America and the Caribbean. Finance & Development, 0032(001), A002. Retrieved Sep 30, 2025, from https://doi.org/10.5089/9781451953176.022.A002
23. ↑ Li Sheng. (2010) Growth–volatility tradeoff in the face of financial openness: a perspective of developing economies. Cambridge Review of International Affairs 23:4, pages 609-622.
24. ↑ Bobacka, Roger (2017) [2001]. "8. "Conclusions and side-effects"". Corporatism and the Myth of Consensus: Working Hours Legislation in Finland in the 1990s. Taylor & Francis. ISBN 9781351765411. Retrieved March 22, 2025.
25. ↑ "The Economic System of Corporatism"