State Capitalism, Deception, and Failure | Capitalismo de Estado, engaño y fracaso

Editorial, El Diario:

When political crises erupted in some underdeveloped countries, groups of individuals took advantage of the situation to seize power and announce socialist programs—according to them, the only way to solve existing problems. But in reality, their intention was to remain in power for as long as possible to enjoy its benefits and have at their disposal the resources of the State treasury, placed at their service.

Among the first with such intentions was the “military socialism” of 1937, implemented after the Chaco War. However, when that government did nothing remotely socialist, it was ousted from power after just nine chaotic months.

What stood out most in almost all these absurd political experiments was that, despite visibly capitalist practices, those governments claimed to have socialist plans. They announced they would “industrialize” the country to lead it to the “socialist paradise” and, in the meantime, would apply “state capitalism” (through public enterprises) as a way to gain popular support. But they never succeeded—only discrediting that ideology, and especially everything labeled as leftist, a label often used to disguise right-wing agendas.

State capitalism, in this context, is a tool of semi-capitalist countries, which never carried out their own democratic revolutions and thus never established a distinct mode of production. In such countries, the State plays a direct role in the economy in various ways. Indeed, state capitalism is sometimes presented as a socialist model—an offer to gain supporters through demagoguery.

Under this approach, the State becomes the owner of companies, businesses, railways, land, forests, factories, industries, and more. These are not socialist state enterprises, but capitalist state enterprises, even though they are branded as “21st-century socialism” or presented as a MAS party initiative—claims that are mere sophistry.

On previous occasions, the populist State undertook such plans, but they ended in complete failure. Nevertheless, the MAS government persisted with that failed project, under the guise of modern socialism. Through this ownership model—by the ruling caste that controls political power—comes the “nationalization” of private companies, which are driven into bankruptcy and closure. These state-owned companies maintain outdated production models: for instance, a feudal tenant-labor system, reliance on imported raw materials, and lack of a domestic consumer market. As a rule, those who run these state companies are appointed by the government and receive high salaries and compensation or severance payments.

Trade union organization is also banned in these state companies. Workers are forced into overtime, used as shock troops against those demanding social improvements, stripped of their right to speak out, and denied access to free information. The nation is being destroyed by the annihilation of its productive forces, to say the least about these “white elephants.”

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