The word capitalism gets tossed around a lot and it losses its meaning. The different types of capitalism get confused in people's minds. Dr. Joseph p. Farrell contributed much of the information in this blog by answering a members vid chat question in November 6, 2017. I described Dr. Farrell's work and the members vid chats in my blog "Introducing Myself".
1. Crony Capitalism.
This developed in the late middle ages and early renaissance. A charter to perform spepecific functions to a group of people calling themselves a corporation. This goes back to theology and the ideas of person hood, natural functions, and rights. The udergirding of the corporation is metaphysical in nature. The corporation receives special privileges and favors from government or perhaps in the renaissance religious authority. These corporations developed into cartels. The policies of these groups have always been mercantilist in nature. They seek out special privileges from secular and religious authority. Also, they get bigger and bigger then drive out competition using economies of scale. Economies of scale is when a business producing a large volume of a good it brings down the cost per unit because overhead costs such as electricity stay the same.
2. Trust/Monopoly Capitalism.
The corporation tries to control the entire process of the industry not necessarily the industry itself. In the late 1800s John D. Rockefeller's company Standard Oil accomplished by controlling the oil drilling, oil refining, the railroads, and the distribution. Globalism is a euphemism for these types of corporations. Their not legitimate and they survive by privileges not the free market.
3. Finance Capitalism.
In a trust at least they make a physical product. In financial capitalism they make money off of money and by speculating on financial instruments. Their not producing anything. George Soros got his start as a currency trader. This is not a types of capitalism Austrian economic thought or Adam Smith would support. Recently, finance has become a larger portion of economy and high frequency trading is conducted by all major financial firms. Artificial intelligence (AI) and algorithms are being utilized for high frequency trading.
4. Mercantalist Capitalism.
In this form of capitalism governments have protective tariffs, subsidies to domestic producers of goods, and quotas on imports or a limit on the amount of a good that can be imported. This originated in the 1700s when the European colonial powers believed that a nation's wealth depended on having a large amount of gold bullion. They acquired gold bullion by having a trade surplus. To accomplish this the British made a law that it's colonies can only trade with Britain.
5. Dismantling Crony Capitalism.
We need trust busting on a massive scale. A century ago even conservatives wanted trust busting because it preserved the free markets. YouTube and police do not care about protecting the work of small authors under copyright laws. If you make a minor violation of a copyright law on a big corporation they will come down on you with everything they have. The corporations are in it for themselves. Austrian economic thought says that all of the first four types of capitalism I described will fail because someone will come up with a better idea. Also, large corporation do not keep up with innovation as well because they have enormous bureaucracy and they do not try things that take many tries before they work. The corporations suppress technology and development because they do not want to have to spend the time and money developing it.
6. Local Placed- Based Finance and Industry.
In this form of capitalism you can see and talk to all of the people that you buy all of your goods and services from. All of the businesses, factories, and banks that you receive goods, services, and loans from would be in your local community. This would mean local industries and local entrepreneurs. It would lead to a boom in the local economy and wages would go up. Also, poverty would decline. Catherine Austin Fitz emphasizes the importance of implementing this form of capitalism on The Solari Report. Austrian economic thought supports this system.
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