Economic interventionism (sometimes called state interventionism) is an economic policy perspective favoring government intervention in the market process to correct the market failures and promote the general welfare of the people. An economic intervention is an action taken by a government or international institution in a market economy in an effort to impact the economy beyond the basic regulation of fraud and enforcement of contracts and provision of public goods. Economic intervention can be aimed at a variety of political or economic objectives, such as promoting economic growth, increasing employment, raising wages, raising or reducing prices, promoting income equality, managing the money supply and interest rates, increasing profits, or addressing market failures.
The term intervention assumes on a philosophical level that the state and economy should be inherently separated from each other; therefore the terminology applies to capitalist market-based economies where government action interrupts the market forces at play through regulations, economic policies or subsidies (state-owned enterprises that operate in the market do not constitute an intervention). The term intervention is typically used by advocates of laissez-faire and free markets. Capitalist market economies that feature high degrees of state intervention are often referred to as mixed economies.
Liberals and other advocates of free market or laissez-faire economics generally view government interventions as harmful due to the law of unintended consequences, belief in government's inability to effectively manage economic concerns and other considerations. However, modern liberals (in the United States) and contemporary social democrats (in Europe) are inclined to support interventionism, seeing state economic interventions as an important means of promoting greater income equality and social welfare. Furthermore, many center-right groups such as Gaullists, paternalistic conservatives and Christian democrats also support state economic interventionism to promote social order and stability. National-conservatives also frequently support economic interventionism as a means of protecting the power and wealth of a country or its people, particularly via advantages granted to industries seen as nationally vital. Such government interventions are usually undertaken when potential benefits outweigh the external costs.
On the other hand, Marxists often feel that government welfare programs might interfere with the goal of overthrowing capitalism and replacing it with socialism because a welfare state makes capitalism more tolerable to the average worker. Socialists often criticize interventionism (as supported by social democrats and social liberals) as being untenable and liable to cause more economic distortion in the long-run. From this perspective, any attempt to patch up capitalism's contradictions would lead to distortions in the economy elsewhere, so that the only real and lasting solution is to entirely replace capitalism with a socialist economy.
The effects of government economic interventionism are widely disputed.
Regulatory authorities do not consistently close markets, yet as seen in economic liberalization efforts by states and various institutions (International Monetary Fund and World Bank) in Latin America, "financial liberalization and privatization coincided with democratization". One study suggests that after the lost decade an increasing "diffusion of regulatory authorities" emerged and these actors engaged in restructuring the economies within Latin America. Latin America through the 1980s had undergone a debt crisis and hyperinflation (during 1989 and 1990). These international stakeholders restricted the state's economic leverage and bound it in contract to co-operate. After multiple projects and years of failed attempts for the Argentine state to comply, the renewal and intervention seemed stalled. Two key intervention factors that instigated economic progress in Argentina were substantially increasing privatization and the establishment of a currency board. As one can see this exemplifies global institutions including, the International Monetary Fund and the World Bank, instigate and propagate openness to increase foreign investments and economic development within places, including Latin America.
In Western countries, government officials theoretically weigh the cost benefit for an intervention for the population or they succumb beneath coercion by a third private party and must take action. Intervention for economic development is also at the discretion and self-interest of the stake holders, the multifarious interpretations of progress and development theory. To illustrate this, during the 2008 financial crisis the government and international institutions did not prop Lehman Brothers up, therefore allowing them to file bankruptcy. Days later when the American International Group waned towards collapsing, the state spent public money to keep it from falling. These corporations have interconnected interests with the state, therefore their incentive is to influence the government to designate regulatory policies that will not inhibit their accumulation of assets. In Japan, Abenomics is a form of intervention with respect to Prime Minister Shinzō Abe's desire to restore the country's former glory in the midst of a globalized economy.
President Richard Nixon signed amendments to the Clean Air Act in 1970 that expanded it to mandate state and federal regulation of both automobiles and industry. It was later further amended in 1977 and 1990.
United States pollution control statutes tend to be numerous and diverse and many of the environmental statutes passed by Congress are aimed at pollution prevention. However, they often need to be expanded and updated before their impact is fully realized. Pollution-control laws are generally too broad to be managed by existing legal bodies, so Congress must find or create an agency for each that will be able to implement the mandated mission effectively.
During World War I, the United States government intervention mandated that the manufacturing of cars be replaced with machinery to successfully fight the war. Today, government intervention could be used to break the United States dependence on oil by mandating American automakers to produce electric cars such as the Chevrolet Volt. Recently, Michigan Governor Jennifer Granholm said: "We need help from Congress", namely renewing the clean energy manufacturing tax credit and the tax incentives that make plug-ins cheaper to buy for consumers. It is possible that government mandated carbon taxes could be used to improve technology and make cars like the Volt more affordable to consumers. However, current bills suggest carbon prices would only add a few cents to the price of gasoline, which has negligible effects compared to what is needed to change fuel consumption. Washington is beginning to invest in car manufacturing industry by partially providing $6 billion in battery-related public and private investments since 2008 and the White House has taken credit for putting a down payment on the American battery industry that may reduce battery prices in the coming years. Currently, opponents believe that the carbon dioxide emissions tax the United States government introduced on new cars is unfair on consumers and looks like a revenue-raising fiscal intervention instead of limiting harm caused to the environment. A national fuel tax means everyone will pay the tax and the amount of tax each individual or company pays will be proportional to the emissions they generate. The more they drive, the more that they would need to pay. While this tax is supported by the motor manufacturers, stipulations confirmed by the National Treasury state that minibuses and midibuses will receive a special exclusion from the emissions tax on cars and light commercial vehicles which went into effect on 1 September 2010. This exclusion is because these taxi vehicles are used for public transport, which opponents of the tax disagree with.
During George W. Bush’s 2000 campaign, he promised to commit $2 billion over ten years to advance clean coal technology through research and development initiatives. According to Bush supporters, he fulfilled that promise in his fiscal year 2008 budget request, allocating $426 million for the Clean Coal Technology Program. During his administration, Congress passed the Energy Policy Act of 2005, funding research into carbon-capture technology to remove and bury the carbon in coal after it is burned. The coal industry received $9 billion in subsidies under the act as part of an initiative supposedly to reduce American dependence on foreign oil and reduce carbon emissions. This included $6.2 billion for new power plants, $1.1 billion in tax breaks to install pollution-control technology and another $1.1 billion to make coal a cost efficient fuel. The act also allowed redefinitions of coal processing, such as spraying on diesel or starch, to qualify them as "non-traditional", allowing coal producers to avoid paying $1.3 billion in taxes per year.
The Waxman-Markey bill, also called the American Clean Energy and Security Act, passed by the House Energy and Commerce Committee in 2010, targets dramatic CO2 reductions after 2020, when the price of the permits would rise to further limit consumers' demand for CO2-intensive goods and services. The legislation is targeting 83 percent reduction in CO2 emissions from 2005 levels in the year 2050. A study by the Environmental Protection Agency estimates that the price of the permit would rise from about $20 a ton in 2020 to more than $75 a ton in 2050.
The Office of Management and Budget (OMB) shows that federal subsidies for coal in the United States were planned to be reduced significantly between 2011 and 2020, provided the budget passed through Congress and reduces four coal tax preferences, namely Expensing of Exploration and Development Costs, Percent Depletion for Hard Mineral Fossil Fuels, Royalty Taxation and Domestic Manufacturing Deduction for Hard Mineral Fossil Fuels. The fiscal 2011 budget proposed by the Obama administration would cut approximately $2.3 billion in coal subsidies during the next decade.
The political definition refers to the degree of state intervention in what is basically a capitalist market economy. Thus this definition 'portray[s] the phenomenon in terms of state encroaching upon market and thereby suggest[s] that market is the natural or preferable mechanism.
The AD–AS or aggregate demand–aggregate supply model is a macroeconomic model that explains price level and output through the relationship of aggregate demand and aggregate supply.
It is based on the theory of John Maynard Keynes presented in his work The General Theory of Employment, Interest and Money. It is one of the primary simplified representations in the modern field of macroeconomics, and is used by a broad array of economists, from libertarian, monetarist supporters of laissez-faire, such as Milton Friedman, to Post-Keynesian supporters of economic interventionism, such as Joan Robinson.
The conventional "aggregate supply and demand" model is, in actuality, a Keynesian visualization that has come to be a widely accepted image of the theory. The Classical supply and demand model, which is largely based on Say's law—that supply creates its own demand—depicts the aggregate supply curve as being vertical at all times (not just in the long-run)Blueshirts (Falange)
The Blueshirts (Spanish: Camisas Azules) was the Falangist paramilitary militia in Spain. The name refers to the blue uniform worn by members of the militia. The colour blue was chosen for the uniforms in 1934 by the FE de las JONS because it was, according to José Antonio Primo de Rivera, "clear, whole, and proletarian," and is the colour typically worn by mechanics, as the Falange sought to gain support among the Spanish working class. In Francoist Spain the Blueshirts were officially reorganized and officially renamed the Falange Militia of the FET y de las JONS in 1940.Businessperson
A businessperson (also businessman or businesswoman) is a person involved in the business sector – in particular someone undertaking activities (commercial or industrial) for the purpose of generating cash flow, sales, and revenue utilizing a combination of human, financial, intellectual and physical capital with a view to fuelling economic development and growth.
An entrepreneur is an example of a businessperson.
The term "businessperson" may refer to a founder, owner, or majority shareholder of a commercial enterprise; or it can characterize a high-level executive who does the everyday running and management of a company even if that executive is not the owner.
The term may sometimes refer to someone who is involved in an upper-level management role in a corporation, company, enterprise, firm, organization, or agency.Capitalist state
The capitalist state is the state, its functions and the form of organization it takes within capitalist socioeconomic systems. This concept is often used interchangeably with the concept of the modern state, though there are many differences in sociological characteristics among capitalist states despite their common functions.The primary functions of the capitalist state are to provide a legal framework and infrastructural framework that is conducive to business enterprise and the accumulation of capital. Different normative theories exist on the necessary and appropriate function of the state in a capitalist economy, with proponents of laissez-faire favoring a state limited to the provision of public goods and safeguarding private property rights while proponents of interventionism stress the importance of regulation, intervention and economic stabilization in providing the framework for the accumulation of capital and business.For Karl Marx, the capitalist state is understood to be a reflection of the economic base, with its chief function reflecting the needs of the capitalist economy. This involves creating the legal and infrastructural framework (the superstructure) that facilitates capitalism as well as balancing the needs of the various classes to ensure the perpetuation of capitalism. This often involves attempts to safeguard state policy from being used to benefit specific capitalists or firms at the expense of the bourgeoisie as a whole. Hence, Marx described the function of the executive of a capitalist state as "nothing but a committee for managing the common affairs of the whole bourgeoisie". Specifically, in Marx's view the capitalist state necessarily exists to serve the interests of capitalists (referred to as "the bourgeoisie"), not as a defect, but as a necessary feature of capitalism. Thus, thinkers in the Marxist tradition often refer to the capitalist state as the dictatorship of the bourgeoisie. Thinkers in the instrumental Marxist tradition stress the role of policymakers and political elites sharing a common business or class background, leading to their decisions reflecting their class interest. This is differentiated from more contemporary notions of state capture by specific business interests for the benefit of those specific businesses and not the ruling class or capitalist system as a whole, which is variously referred to as crony capitalism or corporatocracy.Corporate capitalism
Corporate capitalism is a term used in social science and economics to describe a capitalist marketplace characterized by the dominance of hierarchical and bureaucratic corporations.Crypto-fascism
Crypto-fascism is the secret support for, or admiration of, fascism. The term is used to imply that an individual or group keeps this support or admiration hidden to avoid political persecution or political suicide. The common usage is "crypto-fascist", one who practices this support.Fascio
Fascio (pronounced [ˈfaʃʃo]; plural fasci) is an Italian word literally meaning "a bundle" or "a sheaf", and figuratively "league", and which was used in the late 19th century to refer to political groups of many different (and sometimes opposing) orientations. A number of nationalist fasci later evolved into the 20th century Fasci movement, which became known as fascism.For Fatherland and Freedom/LNNK
For Fatherland and Freedom/LNNK (Latvian: Tēvzemei un Brīvībai/LNNK, abbreviated to TB/LNNK) was a free market national conservative political party in Latvia. In 2011, it dissolved and merged into the National Alliance.
The party was founded from smaller groups in 1993 as 'For Fatherland and Freedom' (TB), with a focus on promoting the Latvian language and putting a cap on naturalisation of Latvian Non-citizens. It won six Saeima seats in its first year, and 14 in 1995, when it entered the governing centre-right coalition. It merged with the moderate Latvian National Independence Movement (LNNK) in 1997, and moved its emphasis to economic liberalisation. TB/LNNK's then-leader, Guntars Krasts, was Prime Minister from 1997 to 1998. It remained in government until 2004, and again from 2006.
Initially from the nationalist right, the party become more moderate after the 1997 merger. It also shifted from supporting economic interventionism to the free market. A predominantly ethnic Latvian party, the party's support base was university-educated, middle class, and concentrated in Riga. The party was soft eurosceptic, and was a member of the anti-federalist Alliance of European Conservatives and Reformists. Its only MEP, party leader Roberts Zīle, sat with the ECR group in the European Parliament. It has caused some controversy with its participation in the Remembrance day of the Latvian legionnaires processions.
For the 2010 parliamentary election, the party formed an alliance with the nationalist All For Latvia!. In July 2011, both parties merged into a unitary party, bearing the name National Alliance.Interventionism
Interventionism may refer to:
Interventionism (politics) is a political term for significant activity undertaken by a state to influence something not directly under its control. It is an act of military, economical intervention that is aimed for international order, or for the benefit of the country. Antonym: Non-interventionism.
Economic interventionism is any activity in a market economy, beyond the basic regulation of fraud, undertaken by a central government in an effort to affect a country's economy.
Interventionism (medicine) is also a medical term in which patients are viewed as passive recipients receiving external treatments that have the effect of prolonging life.
Interventionism (group dynamics) is an activity that functions with conscious and active interferences to improve group/family/individual functioning.
Intervention (counseling) is an orchestrated attempt by one person or many people (usually family and friends) to get someone to seek professional help with an addiction or some kind of traumatic event or crisis, or other psychological problem.Interventionism (politics)
Interventionism is a policy of non-defensive (proactive) activity undertaken by a nation-state, or other geo-political jurisdiction of a lesser or greater nature, to manipulate an economy and/or society. The most common applications of the term are for economic interventionism (a state's intervention in its own economy), and foreign interventionism (a state's intervention in the affairs of another nation as part of its foreign policy).Labor Left
The Labor Left (also known as the Socialist Left and Progressive Left) is an organised Left faction of the Australian Labor Party. It competes with the more economically liberal Labor Right faction.
The Labor Left operates autonomously in each State and Territory of Australia, and organises as a broad alliance at the national level. Its policy positions include party democratisation, economic interventionism, progressive tax reform, refugee rights, gender equality and gay marriage.Law and Justice
Law and Justice (Polish: Prawo i Sprawiedliwość; listen ; PiS) is a national-conservative, Christian democratic political party in Poland. With 237 seats in the Sejm and 66 in the Senate, it is currently the largest party in the Polish parliament.
The party was founded in 2001 by the Kaczyński twins, Lech and Jarosław. It was formed from part of the Solidarity Electoral Action (AWS), with the Christian democratic Centre Agreement forming the new party's core. The party won the 2005 election, while Lech Kaczyński won the presidency. Jarosław served as Prime Minister, before calling elections in 2007, in which the party came in second to Civic Platform (PO). Several leading members, including sitting president Lech Kaczyński, died in a plane crash in 2010.
The party programme is dominated by the Kaczyńskis' conservative and law and order agenda. It has embraced economic interventionism, while maintaining a socially conservative stance that in 2005 moved towards the Catholic Church; the party's Catholic-nationalist wing split off in 2011 to form Solidary Poland. The party is solidarist and mildly Eurosceptic, and shares similar political tactics with Hungary's Fidesz but with anti-Russian stances.
PiS is a member of the Alliance of Conservatives and Reformists in Europe (ACRE) European political party. The current sixteen PiS MEPs sit, as well as three other people elected from the PiS register, in the European Conservatives and Reformists group in the European Parliament.Mercantilism
Mercantilism is a national economic policy that is designed to maximize the exports of a nation. Mercantilism was dominant in modernized parts of Europe from the 16th to the 18th centuries before falling into decline, although some commentators argue that it is still practiced in the economies of industrializing countries in the form of economic interventionism.It promotes government regulation of a nation's economy for the purpose of augmenting state power at the expense of rival national powers. Mercantilism includes a national economic policy aimed at accumulating monetary reserves through a positive balance of trade, especially of finished goods. Historically, such policies frequently led to war and also motivated colonial expansion.Mercantilist theory varies in sophistication from one writer to another and has evolved over time. High tariffs, especially on manufactured goods, was an almost universal feature of mercantilist policy. These policies aim to reduce a possible current account deficit or reach a current account surplus.
With the efforts of supranational organizations such as the World Trade Organization to reduce tariffs globally, non-tariff barriers to trade have assumed a greater importance in neomercantilism.National Fascist Party (Argentina)
The National Fascist Party of Argentina (Partido Nacional Fascista) was a fascist political party formed in 1923. In 1932, a group broke away from the party to form the Argentine Fascist Party, which eventually became a mass movement in the Córdoba region of Argentina.Omnipotent Government
Omnipotent Government: The Rise of the Total State and Total War is a book by Austrian School economist Ludwig von Mises first published in 1944 by Yale University Press. It is one of the most influential writings in Libertarian social thought and critique of statist ideology and socialism, examining the rise of Nazism as an example. The book treats Nazism as a species of orthodox socialist theory. At the same time the book offers a critique of economic interventionism, industrial central planning, the welfare state and world government, denouncing the trends of the Western Allies towards the total state. The book was made available online by the Ludwig von Mises Institute in 2004.Regulatory capitalism
The term regulatory capitalism suggests that the operation maintenance and development of the global political economy increasingly depends on administrative rules outside the legislatures and the courts.
The general trend despite and beyond the process of liberalization is that of growth rather than decline of regulation. Deregulation may represent trends in some industries (notably finance), but more regulation is the general trend beyond that characterize modern and post-modern capitalism alike. Regulation in this interpretation is an instrument of organizations—states, business, civil and hybrid and is carried at all political arenas and levels.
The concept of regulatory capitalism serves as an alternative to concepts like financial capitalism, welfare capitalism, casino capitalism, developmental capitalism, risk capitalism, state capitalism and crony capitalism in an attempt to shed more light on capitalism as a polymorphous order.Statism
In political science, statism is the belief that the state should control either economic or social policy, or both, to some degree.While the term "statism" has been in use since the 1850s, it gained significant usage in American political discourse throughout the 1930s and 1940s. Ayn Rand made frequent use of it in a series of articles in 1962.Tropical fascism
In African political science, tropical fascism is a type of post-colonial state which is either considered fascist or is seen to have strong fascist tendencies. Gnassingbé Eyadéma dictator of Togo and leader of the Rally of the Togolese People, Mobutu Sese Seko dictator of Zaire and leader of the Popular Movement of the Revolution and Idi Amin dictator of Uganda have all been considered an example of tropical fascism in Africa. The Coalition for the Defence of the Republic and larger Hutu Power movement, a Hutu ultranationalist and supremacist movement that organized and committed the Rwandan Genocide aimed at exterminating the Tutsi people of Rwanda, has been regarded as a prominent example of tropical fascism in Africa. Pol Pot and The Khmer Rouge regime in Cambodia has been called a tropical fascist regime, as they officially renounced communism in 1981.