Actually existing capitalism
"Actually existing capitalism" or "really existing capitalism" is a term used by critics of capitalism in general or neoliberalism specifically. Meant to be ironic, the term is used to claim that many economies purportedly practicing capitalism, an economic system characterized by a laissez-faire free market system, in fact have significant state intervention and partnerships between private industry and the state.[1][2] The term mixed economy is also used to describe economies with these attributes. The term seeks to point out discrepancy between capitalism as normally defined and what is labelled as capitalism in practice, and to claim that capitalism as defined is not desirable, pointing to the use of regulation in avoiding economic problems such as acute commodities fluctuations, financial market crashes, monopolies, and extensive environmental damage.
Capitalism defined
Capitalism is defined as an economic system with the following attributes:
- Informed consumers making rational decisions regarding their purchases
- Perfect competition, which results in (1) easy entry and access to the marketplace; and (2) long run profits and surpluses not being possible, although short term booms may be.
Technical problems with capitalism in practice
Critics of capitalism as in the above definition hold that perfect competition is only theoretical, and that any economy that claims to be capitalist is actually some other type of economic system, i.e. only has some capitalist features. Further, current understandings of economics would need to incorporate this impossibility of such capitalism, no longer using the definition of capitalism as a starting point with which to analyze an economy. In this sense, the term can be understood as a critique of the methods of the economics discipline generally, and specifically of the Austrian School or the Chicago school of economics.