Posted on 02/22/2016 5:48:05 PM PST by Kaslin
We hear the term “crony capitalism” get tossed around a lot but … what does it actually mean? We should find out soon, considering that the current Republican front-runner has been held up as an example of a practitioner of the art. It’s a little more complex than just twisting arms on zoning codes, though, and Prager University engaged Jay Cost to explain the corrosive corruption the term signifies:
Capitalism is moral because it is premised on a voluntary exchange between independent parties - who agree to the deal only because it creates value for everybody. Crony capitalism is immoral because one of the parties—the government—has been bought off.
This creates three problems. First, it is unfair. Politicians are spending the public's money, but not for the public interest. Instead, they reward friends, supporters, or themselves. Our Constitution grants Congress the power to provide for the general welfare. Crony capitalism violates this sacred principle.
Second, it is incredibly wasteful. In our cereal example, the government overpaid by going with Ted instead of Steve. That's obviously a waste of taxpayer money. In fact, it is really stealing from the taxpayer. Here’s more waste. Ted had to spend money to lobby the government to get the contract. So, he didn't get all of that dollar out of the transaction. That's money that could have been spent making a better product or used in some other constructive way. Economists call this deadweight loss. And it can be substantial.
Moreover, crony capitalism distorts the broader economy. In some industries—like healthcare, student loans, home mortgages, and aerospace-the government is one of the biggest purchasers of goods or services. So its politicized decisions can have wide-ranging and detrimental effects. An entire industry can become, in effect, a client of the government. When that happens its goal is not to build a better mousetrap, but to keep politicians happy. How much does crony capitalism cost society per year? It is hard to say precisely, but the number reaches into the tens of billions of dollars, maybe beyond.
Third, it tempts politicians to break the law. Once politicians feel free to spend the public's money for their own political purposes, they are just a hop-skip-and-a-jump away from doing so to line their own pockets or pump up their campaign funds or both.
The biggest manifestation of crony capitalism, or perhaps more plainly cronyism, in this campaign is not Donald Trump — it’s Hillary Clinton. While in the Senate and especially at the State Department, corporations poured hundreds of millions of dollars into both the Clinton Foundation and the Clintons’ pockets. She and Bill took in $57.5 million in speaking fees largely from private-sector businesses during her four years as Secretary of State, including from entities having business with the State Department and the US government. The Uranium One deal was just one such example that resulted in much of America’s uranium stores ending up under the control of a Russian consortium.
Comparatively speaking, Trump’s gladhanding and favor-currying looks relatively clean. He never asked for a public trust, he argues, but had to work deals in the environment created by others. And he has a point.
It’s all about the ‘tax base’ with these people. The femenist movement was all about getting women into the workplace. More tax money. Blanket amnesty.....another tax base. The gibsmedats? Keeping them on welfare to
constantly keep demands on the tax base and vote in people who would give them freebies......further whipping the tax payers. It’s sickening.
Crony Capitalism (CC) gets you unlimited immigration, cheap labor and screws over the American people and hastens the socialist take over. CC gets you “free Trade” deals that are really nothing but labor arbitrage of slave labor across international borders in return for duty free import. CC gets you H-1b visas that are solely for the purpose of destroying a major sector of the middle class and is corporate welfare for the Zuckerbergs of the world. I would say the GOPe is way more guilty than the Democrats but that is a hard call to make, who is the slutier party.
It’s called mercantilism
Crony capitalism is simple, oligarchs and corporations buy off the political class who then select their corporate masters as economic winners by using regulations and government approved consolidation to eliminate any competition. These corporations then get to socialize their losses with public funding while allowing them to privatize their profits and they are never investigated or held accountable for illegal and corrupt behavior.
Most recent example is the Wall St. guys skating after 2008. They actually had to come out in the open to ram TARP through but since then they no longer care since they got by with it and made out like bandits.
It’s something I’m tired of hearing. We should use a different term rather than use “capitalism” negatively like the left does. Who coined the term? I’d bet it wasn’t any conservative.
“The big-government/big-union/big-corporate crony-capitalist complex doesn’t care if the pie gets smaller, they just want the whole pie.”
Don’t forget BIG Non-Profits. Planned Parenthood is every bit as much a crony as General Electric. They take taxpayer money and then turn around and donate, endorse, and campaign to get the folks who voted them money reelected.
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