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Comment by tirant | Hacker News Reader

Same as any other economic system: power is usually concentrated around a very small group of people. In socialism and communism, that concentration typically occurs within the party leadership or central planning apparatus.

However, in free-market capitalism, anyone is allowed to participate in capital formation and accumulation. Ownership is not formally restricted to a political class. Entry into markets is open in principle (unless it stops being a free market), and capital allocation is decentralized through free and voluntary exchange rather than administrative decree.

That does not mean capitalism eliminates power concentration, as Wealth can accumulate and translate into political influence. But the mechanism of power differs: In centrally planned systems, control flows from political authority. In market systems, control flows from voluntary transactions and competitive success.

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> anyone is allowed to participate in capital formation and accumulation

In the same sense that nobody is allowed to sleep under a bridge.

I don't follow. Even now there is nothing preventing anyone here from making something for millions of dollars. While VC capital is closed to a select few, a person in a garage can still make it big.

Communist counties tend to gate keep even more. To the point that it is entirely who you know, with little concern to what you do.

> Even now there is nothing preventing anyone here from making something for millions of dollars.

Any one person might. But the system is setup such that's it's almost impossible for everyone to do well.

> Communist counties tend to gate keep even more. To the point that it is entirely who you know, with little concern to what you do.

And in capitalist countries, it's how much money you have. Swings and roundabouts.

> But the mechanism of power differs: In centrally planned systems, control flows from political authority. In market systems, control flows from voluntary transactions and competitive success.

This is a boilerplate theoretical explanation of capitalism which bears very little resemblance to how things actually work in most Western capitalist societies, particularly America.

A cursory glance at the majority of large markets reveals that they are dominated by a handful of massive companies, who use their enormous wealth and influence to steer (centrally planned) political policies, thereby stymying competition and entrenching their position.

> Same as any other economic system

Only if you limit yourself "capitalism" and "communism" as the two economic systems you are are considering. What we should be doing is noticing that these two systems fail in very similar ways (concentration of power in a small group of people), and think about what kind of system might not fail in that way.

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