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I guess look around the world and see what's working? Unfettered capitalism wouldn't work, and cronyism isn't unique to capitalism.
Unfettered meritocracy doesn't work either. Say I'm born smart and ambitious and become a captain of industry. Why do I "deserve" to make 100x or 10000x more than someone who is working hard but not smart or ambitious, or someone who is wildly creative in a not monetizatable way? And how do you even ensure all kids get the same starting line to actually have a meritocracy, if you are enforcing capitalism? 100% inheritance tax maybe, and the money allocated out to everyone?
Maybe all these systems are ideas - capitalism, socialism, fascism, meritocracy, and none could be achieved in real life, because we aren't living in a controlled test environment.
On your specific question, I think cronyism and inheritance are problems that transcend capitalism, but if you could somehow magically disappear them, meritocracy would reveal its faults, there isn't a perfect system. All we can do is try to think about what we want to achieve (environmental restoration, a healthy population, a vibrant marketplace that serves everyone not just a few) and try to incrementally get there.
I want to respond but would ask if you would humor me in my line of questioning. If not, no worries.
Why should we assume that without the influence of nepotism that capitalism will continue on the same path of corporate greed?
Human nature. I don't think it's the worst economic system, but if you measure everything in dollars, and say that a business venture's only task is to make value measured in dollars, I don't see how it can avoid exploitation.
As an accountant I want to say it might work if businesses were required to pay all the costs they currently externalize and hand to society and the future (so pollution or underpaying employees would be more expensive than being clean and paying more of the $ to the workers) but I'm not completely convinced.
As it stands now, companies become profitable because they aren't paying what it costs to produce their stuff. It seems baked into the system.
So, in my mind wealth should last a generation. That is, wealth that is allowed to compete in the market. Ok, well that's nebulous but it is also a new idea to me. Say a CEO at the end of his life has no choice but to pass on his wealth to his children, which then can't re-enter the market as an investment tool but can only be used for consumer goods and services or maybe residential real estate. Or alternatively putting it back into the company as means for growth which can propel others into higher levels of management. Anyway, kinda just wanted to have this discussion from the onset.
Thanks for being a bro.