Crony
Capitalism Protects Wrongdoers, Harms Consumers, and Disrupts Markets
May 9, 2013
By Ken
Connor
Thanks to a renewed interest in the works of Ayn Rand and
high-profile figures like John Stossel, Glenn Beck, and Rand Paul,
libertarianism is enjoying a moment in the political sun. And just like
America's two major parties, libertarians can often be blind to faulty logic
and flaws within their own ideology. Timothy P. Carney recently wrote a piece
for The Atlantic discussing this very problem:
"Voters despise government officials who get in bed
with corporations. But what about corporations who cozy up to government? Are
companies who use cronyism to grow their profit acting unethically?
The question makes some free-marketeers uneasy. After
all, we not only tolerate the fierce pursuit of profit, but also we defend it
against taxes and heavy-handed regulation. Milton Friedman famously said, 'The
social responsibility of business is to increase its profits.'
But in the age of crony capitalism, libertarians must
declare that some means of pursuing profit are immoral and call on executives
to reject them. This would create a positive case for capitalism – arguing that
the pursuit of profit, in the context of fair and open competition, helps the
whole society. The new corporate social responsibility, redefined for
libertarians, must stand athwart crony corporatism yelling 'stop.'"
Lest his readers underestimate the influence and scope of
crony capitalism, Carney provides a thumbnail sketch of the practice in action
over the last decade. Seeing our
government's extensive network of corporate welfare laid out in black and white
is sobering, to say the least:
"The 2005 and
2007 energy bills required drivers to buy ethanol, created a government
loan-guarantee program for private sector green-energy projects, and
effectively outlawed the traditional incandescent light bulb. . . . Then, 2008
saw an avalanche of corporate bailouts: Bear Stearns, AIG, Fannie Mae and
Freddie Mac. Then the TARP bailed out all of Wall Street, and later General
Motors and Chrysler.
Obama came to power in 2009 and signed an $800 billion
stimulus bill supported by the Chamber of Commerce and loaded with goodies for
the likes of Google and Solyndra. Obama pushed cap-and-trade with the support
of the U.S. Climate Action Partnership, a corporate coalition led by GE, which
had set up a business to create and trade greenhouse-gas credits.
In June 2009,
Obama signed the Family Smoking Prevention and Tobacco Control Act, a
regulatory measure that Philip Morris supported and reportedly helped write.
... The drug lobby wrote significant parts of Obamacare, and the hospital lobby
liked the bill enough to file an amicus curiae brief with the Court defending
the law from its challenge by states and the small business lobby.
Boeing and the Chamber of Commerce launched a full-court
lobbying push in 2011 to save and expand the Export-Import Bank, the government
agency Obama loves using to subsidize U.S. Exports – including lots of Boeing
jets. In a lesser-known case of regulatory profiteering, Obama hired H&R
Block's CEO to a top position at the IRS, where he crafted new regulations on
tax preparers – rules which H&R Block supported and small tax preparers
sued to overturn."
Regardless of
where your political sympathies lie, it's undeniable that there is an unhealthy
and unholy alliance between well-heeled special interests and politicians and
policymakers. It's all well and good to embrace Ms. Rand's philosophy
of self-seeking individualism in theory, but when this mentality insinuates
itself into the markets unchecked by moral and ethical principles, the results
are antithetical to freedom and fairness.
Basically, the special interests invest in political
campaigns as a cost of doing business, and they expect a handsome return on
their investments. As Mr. Carney explains, that usually comes in the form of
pet legislation, subsidies, tax breaks, limitations on liability, preferential
treatment . . . the list goes on and on. Of course, politicians are only too
happy to accommodate these special interests in exchange for political
contributions that help cement and perpetuate their power.
As a result, the free market is stymied; it can't do what
it's designed by nature to do, which is to sift good companies from bad ones,
reward efficiency and innovation, and empower consumers with authentic choice
in the marketplace. In effect, crony capitalism is a form of central planning,
something that libertarians and conservatives historically eschew.
The lack of accountability of the cronies is particularly
damaging. Defenders of free-market capitalism generally maintain that
accountability and responsibility must run hand in hand in order for markets to
operate effectively. If wrongdoers are not held accountable, their wrongdoing
will multiply and the whole system will be corrupted. Unfortunately, many
free-market apologists in the political arena are only too ready to offer a
double standard to their corporate benefactors.
Consequently, we wind up with the excesses that
characterized firms like AIG, Fannie Mae, and Enron; we end up with lives lost
due to malfeasance at the hands of mining companies and peanut companies, from
drugs that cause injury and death and products that explode or fail and cause
harm.
We have an epidemic of malpractice and abuse and neglect
in nursing homes because wrongdoers aren't held fully accountable. All of this
is a direct result of corporations taking shortcuts and playing Russian
roulette with consumer safety because they know they will be shielded from
accountability if something goes wrong.
As Madison said, "If men were angels, government
wouldn't be necessary." Well, they aren't, and we do. The world
"regulation" is an anathema to free-market apologists, but it
shouldn't be. Proper government regulation and consumer protections are
essential to ensure an ethical marketplace.
The fewer regulations we have, the more consumer
protection mechanisms we need, and vice versa. This is precisely the purpose of
America's civil justice system. It is wrong for corporations to lobby for fewer
regulations while simultaneously perverting policy so that they are insulated
from accountability in the civil justice arena when they err. When this is
allowed to happen, corporate America runs amok and consumers are harmed.
Mr. Carney is correct when he says that the case for
capitalism must rest on the willingness of free-marketeers to demand ethical
conduct from corporations and politicians alike. Our current economic and
political problems aren't just the fault of President Obama, or Nancy Pelosi or
any other big government bogey.
The sooner libertarians and conservatives alike recognize
this, the sooner we can get our economy and our government back on the right
track, and given the enormity of the challenges facing us over the next several
decades, this can't happen soon enough.
*
OBAMA and his culture of
BANKSTER LOOTING of America.
Is Penny Pritzker
Obama’s newest BANKSTER?
Obama warns against
“cynicism” at Ohio State commencement address
do a google of Obama’s BIG BANKSTER
DONORS and you will find a list of the banks that have looted this nation, yet
found a place in the corrupt Obama administration!
*
OBAMA’S BILLIONAIRE NOMINEE FOR COMMERCE, PENNY PRITZKER…
BILLION$$$$ MADE OFF HIRING CHEAP ILLEGAL LABOR??? show me even one dem
billionaire that does not push for obama’s agenda of OPEN BORDERS, NO E-VERIFY
and NO ENFORCEMENT of LAWS PROHIBITING THE EMPLOYMENT of ILLEGALS…even one!
Based
in Chicago, Pritzker operates an international empire based on low-wage service
work in Hyatt-operated hotels and nursing homes, along with several investment
firms.
*
PART OF OBAMA’S
CRONISM IS OPEN BORDERS, NO E-VERIFY AND NO JOBS FOR LEGALS. EXACTLY THE SAME
POLICIES THE U.S. CHAMBER of COMMERCE FOLLOWS. IT’S ALL ABOUT KEEPING WAGES
DEPRESSED FOR HIS CRONIES!
THE MEXICAN OCCUPTION
DEPRESSES WAGES FOR AMERICANS $300 TO $400 BILLION PER YEAR. PARTICULARLY HIT
ARE BLACK AMERICANS.
The OBAMA – McCAIN Amnesty Promises NO E-VERIFY enforcement
to Employers and NO BORDER enforcement to LA RAZA invaders.
…isn’t
that what we already have going ????
Dream Act proposals are also a magnet for fraud. Many illegal
immigrants will fraudulently claim they came here as children or that they are
under 30. And the federal government has no way to check whether their claims
are true or not. REP. LAMAR SMITH
"It lets businesses that knowingly
violated the law off the hook," Mr. Krikorian said. "If they were not
withholding payroll taxes, they’re held harmless. If they were violating labor
laws, they’re held harmless. So this is a boon for crooked business."…
MARK KRIKORIAN
“Another force for amnesty is corporate America. Thousands of
businesses have hired illegals in violation of U.S. law. Amnesty for their
illegal workers means, de facto, amnesty for them”… PAT BUCHANAN
THE REALITY OF OBAMA’S
IN-SOURCING US INTO A THIRD WORLD DUMPSTER THAT WILL KEEP HIS WALL STREET
PAYMASTERS HAPPY AND GENEROUS!
"Wage-cutting, speedup and the imposition of sweat shop conditions are at the heart of Obama’s strategy for doubling US exports by 2015. He has repeatedly boasted of his administration’s success in “insourcing” jobs back to the US, omitting to mention that these jobs often pay half their previous wage."
The danger, as Washington
Post economics columnist Robert Samuelson argues, is that of “importing
poverty” in the form of a new underclass—a permanent group of working poor.
…or simply the president for the 1%???
how do the la raza dems
build their party base of illegals? no borders, no enforcement, no E-VERIFY, no
legal need apply AND MUCHO DREAM ACTS of WEFLARE, OBAMACARE and now food
stamps.
“The
watchdogs at Judicial Watch discovered documents that reveal how the Obama
administration's close coordination with the Mexican government entices
Mexicans to hop over the fence and on to the American dole.” Washington Times
Barack
Obama… the man that conned an entire nation and still called it “CHANGE”… but
was only Bush’s 3rd & 4th terms.
THE YEAR WAS 2009…
At the town hall in New Orleans, Obama appealed for patience. He said, “Change is hard, and big
change is harder.” Is that the excuse? Now where have I heard that before? Oh,
yeah. From George Bush.
OBAMA’S
WAR ON AMERICANS (LEGALS) AND OUR HOMELAND SECURITY
However,
today, with President Obama so ill-intentioned toward the United States and its
future, negotiations between him and with those of us who oppose him are
pointless.
Obama’s
America… the Rich Get Much Richer, Illegals Get the Jobs and Dream Acts of
Welfare and the American Middle Class is Stuck With the Tax Bills for Wall
Street and Mexico’s Looting.
OBAMAnomics:
CRONY KING
OBAMA: CURL: The Obamas live the 1 percent life
OBAMA’S
CRONY CAPITALISM: SOARING PROFITS FOR OBAM’S WALLL STREET LOOTERS! And then the
jobs go to illegals!
IS OBAMA
MERELY BUSH’S THIRD and FOURTH TERMS?
CRONY CAPITALISM
Obamanomics: How Barack Obama Is Bankrupting You and
Enriching His Wall Street Friends, Corporate Lobbyists, and Union Bosses…and
Muslim Dictators
OBAMA’S HAREM OF CORRUPT BANKSTERS… DO A GOOGLE
FOR HOW MANY ENDED UP WORKING IN HIS ADMINISTRATION.
“Records show that four out of
Obama's top five contributors are employees of financial industry giants -
Goldman Sachs ($571,330), UBS AG ($364,806), JPMorgan Chase ($362,207) and
Citigroup ($358,054).”
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