Corporatism

Corporatism is a governmental system in which society is divided into industrial and professional associations referred to as "corporations." These corporations are not the same as the more familiar commercial corporations that operate as large businesses, although both meanings of the word come from the Latin corpus, or body.

Corporations in a corporatist society represent major interest groups that collectively negotiate for political influence for their members and activities. Though powerful, the various corporations and their interests and initiatives are subordinate to the state in which they operate.

The basic idea of corporatism has developed slowly since ancient times. It realized its first modern manifestation in France in the late 1700s. Since that time, other countries have adopted corporatist ideals. In reality, corporatist governments have been historically dominated by dictatorial regimes.

Major Aspects

In corporatist systems, political and economic forces merge through the organization of society into corporations. Within each corporation, workers and employers in an industry work together to negotiate wage changes, labor laws, and other issues related to economic output.

Corporations also wield political power and can use similar negotiation processes to gain political advantage for people and organizations within their jurisdiction. However, under corporatism, the overall power of the state supersedes the power of any individual, corporation, or alliance. Corporatism is a form of collectivism, a political system in which the state holds great power over property and business. In corporatism, the state does not own all properties or businesses but strictly oversees and regulates them.

Corporatist governments directly support the state more than the individual. However, individuals should, at least in theory, benefit from the overall enrichment of the state. In theory, as the state improves, the lives of citizens will, too. Citizens are meant to understand economic prosperity, cultural offerings, social programs, military defense, and other benefits as incentives to promote and work for the goals of the state.

In dealings within and between corporations, the main means of negotiation is collective bargaining. Collective bargaining refers to the process by which groups of people negotiate through representatives. It is most often used in workplace situations where workers’ unions negotiate with employers over wages, workplace safety, and benefits. People use collective bargaining to reach agreements and settle problems cooperatively rather than through power, competition, or other means.

Despite the emphasis on collective bargaining in corporatist theory, in practice, many decisions in corporatist governments are made by the state. Rulings on both political and economic matters may become the ultimate domain of dictators and their regimes. In this way, the principles behind corporatism are obscured and overpowered by the host state.

Historical Development

The basic concept of corporatism and the overall belief that individuals could only become truly fulfilled when part of a political community gradually developed over many hundreds of years. Its ideological roots can be traced back to the philosophers of Ancient Greece, the legal codes of the Roman Empire, and the social mores of medieval Europe. These ideas intermixed with Christian belief systems, spreading their influence worldwide.

True modern ideas of corporatism first appeared in France shortly after the French Revolution of the late 1700s. From there, the ideas quickly spread eastward to Germany and Austria, where they were championed by Adam Müller (1779-1829), political advisor to influential Austrian statesperson Prince Klemens von Metternich (1773-1859).

Müller had determined that new political and economic ideals sweeping through Europe threatened to uproot the continent's long-held social structure. In particular, the French idea of egalitarianism (a philosophy that holds that all people should be treated equally) and the economic theory of laissez-faire (in which government interference is removed from most economic transactions) were spreading quickly and turning many from the status quo.

To safeguard the power of the ruling classes and the established systems in Europe, Müller became a strong proponent of corporatism. He felt corporatism would counter egalitarianism and laissez-faire ideas. He believed corporatism would appeal to rulers who wanted to preserve government power over economic markets. He thought it would also appeal to ordinary people, who believed excessive self-interest was sinful and were comfortable with established regulations.

Under the promotion of Müller and others, corporatist ideas took hold in some parts of Europe. However, by the mid-1800s, new waves of radical ideas again threatened to overturn European tradition. These ideas included socialism (a belief that the state should own and control all business) and syndicalism (a belief that workers’ unions should own and control all business). These contrasting systems brought debate and conflict to many societies.

In the late 1800s, corporatism took many forms and merged into several other political and economic philosophies. In the 1900s, however, a number of leaders and governments began identifying themselves as corporatist. People flocked to the idea in the belief that a truly corporatist structure would allow a strong state to protect the people without becoming oppressive or overly powerful.

Corporatist elements influenced governments throughout Europe, Asia, and the Americas. Some elements were temporary or based on limited policies. Other corporatist elements became the foundations of the entire government. Perhaps the most striking case was National Corporatism, the fascist government of Benito Mussolini in Italy that lasted from 1922 to 1945. Spain and Germany also adopted governments with strong corporatist overtones. However, in each case, true corporatist ideals were obscured and corrupted by the ambitions of dictators.

Despite its numerous interpretations and propensity toward misuse, corporatism remains influential in the contemporary world. Many nations around the globe have governmental systems with strong corporatist elements. Using the Nordic model, Sweden, Norway, Denmark, and Finland have developed a comprehensive form of social corporatism that encourages cooperation between government, labor unions, and business associations and provides a strong welfare state. Germany and Austria have implemented a system of corporatism known as social partnership. The Netherlands, Slovenia, and South Africa have also incorporated elements of corporatism. People continue to embrace these ideas for their potential ability to grow economies and encourage cooperation among businesses, workers, unions, and the government.

Bibliography

"Collective Bargaining." American Federation of Labor and Congress of Industrial Organizations, www.aflcio.org/Learn-About-Unions/Collective-Bargaining. Accessed 1 Nov. 2024.

Gronow, Antti, et al. "Divergent Neighbors: Corporatism and Climate Policy Networks in Finland and Sweden." Environmental Politics, vol. 28, no. 6, 2019, pp. 1061-1083. Taylor & Francis Online, doi.org/10.1080/09644016.2019.1625149. Accessed 1 Nov. 2024.

Jahn, Detlef. "Changing of the Guard: Trends in Corporatist Arrangements in 42 Highly Industrialized Societies from 1960 to 2010." Socio-Economic Review, vol. 14, no. 1, 2016, pp. 47-71, doi.org/10.1093/ser/mwu028. Accessed 1 Nov. 2024.

Stromberg, Joseph R. "Corporatism as Theory and Practice." Future of Freedom Foundation, 1 Feb. 2014, fff.org/explore-freedom/article/corporatism-as-theory-and-practice/. Accessed 1 Nov. 2024.

Watkins, Thayer. "The Economic System of Corporatism." San Jose State University, www.sjsu.edu/faculty/watkins/corporatism.htm. Accessed 1 Nov. 2024.

Wiarda, Howard J. Corporatism and Comparative Politics: The Other Great "Ism." M.E. Sharpe, 1997.