One of the weirder aspects of laissez-faire economics is that its advocacy of individual liberty goes hand in hand with praise for the corporation. The state, we learn, can’t possibly look after individuals’ interests – because to do so would require an inefficient and corrupt command economy. Instead we must look to the market, and the interaction between consumers and corporations. Very few economists go on to mention that… the corporation is a command economy.
The corporation can at times resemble a state (as with the East India company – which wasn’t so much a state, as a state’s ruling class). More often it resembles a medieval manor, with its rigid hierachies, its idle owners of the productive resources, and its payment in kind, not cash. Yes, I know, we get our wages in money. But this is not really a market exchange. Rather, we work at producing cash (just as a medieval serf worked at producing grain) – then we receive some fraction of our product as our wage. For there is no market within a corporation. The corporation is a world to itself, based more on patronage and fealty than laissez faire supply and demand.
The movement from feudalism to capitalism went hand in hand with a change in the dominant modes of production (I’m sure I’ve heard this somewhere before…) Feudalism died as industry was born. The manorial estate was based on the pre-eminence of land: “no land without a lord, no lord without land.” When the link between land and productive resources was severed – when land ceased to be the dominant form of capital – the feudal estate went mobile, or virtual. The modern corporation has its lords and its serfs; but because its resources are diffuse or even incorporeal, this fundamental relationship of bondage is obscured.