How the World Was Made Safe
for Crony Capitalism
Mises Institute posted essay explains how crony capitalism has been gaining the upper hand over free-market capitalism over the past half century in the U.S. .. points out "crises are the health of the state" .. David Stockman*'s recent book, The Great Deformation explains how crises have been used by the state to its advantage to funnel billions of dollars from the general public into the pockets of the well-connected .. Stockman's chief culprits are the ideas of Fisher, Keynes, & Friedman; the institutions of the Federal Reserve System, the financial crisis etc .. this essay also points out how periods of easy money are fertile fields for crony capitalism .. "Easy money policy enables increased government spending and as government spending grows, so does the opportunity to divert that spending toward the well-connected." .. also, policies such as zero interest rates, quantitative easing & too-big-to-fail socialize the losses of the cronies of those who wield power .. "As bad as crony capitalism is in its own right, it does further damage by sullying the name of free-market capitalism, the most productive economic arrangement known to man. This adds 'injury to insult,' since if free-market capitalism is the cause of our problems, then the solution must be greater regulation, which generally provides even more scope for the favoritism and corruption that characterize crony capitalism."
LINK HERE to a recent posting From Our Archives:
America's Crony Capitalism
Acting Man points out a recent poll which found that 70% of Americans think government & big business often work together against consumers, investors .. Acting Man sees an increasing trend in the U.S. towards crony capitalism .. Crony capitalism is a term describing an economy in which success in business depends on close relationships between business people & government officials .. Acting Man explains how big U.S. corporations lobby to obtain privileges from the government .. on the financial crisis: "Immediately after the crisis & ever since, the storyline sold to the hoi-polloi by the controlled media was that the crisis was an example of a 'market failure' and that government had to step in to 'save the market economy from itself'. We have previously remarked on what a travesty this narrative represents. For one thing, without government-directed interventions, there would have been no crisis in the first place (at least not of such magnitude). The media were and are falling over each other singing the praises of our 'saviors', rarely expending a drop of ink on the fact that these allegedly so praiseworthy minions of the State were in essence the same people that were responsible for the mess in the first place." LINK HERE to a related posting 
No comments:
Post a Comment