Friday, May 21, 2010

Cronyism By Michael Beitler

By Michael Beitler

Perhaps the biggest problem in America today is cronyism. Cronyism is big business in bed with big government. Big businesses buy influence through their campaign contributions, including political action committee (PAC) contributions.

Small business owners and entrepreneurs do not have the money to hire professional lobbyists or to fund a PAC. Big businesses have the money to hire professional lobbyists and to fund PACs. The professional lobbyists hired by big businesses work to pass burdensome regulations to crush smaller competitors. The big business PACs make contributions to political candidates (mostly incumbents) in exchange for favors.

Lobbying for big business has become a big business itself. One look at K Street in Washington, DC will give you an indication of the extent of this form of corruption. Some of these lobbyists are the most powerful people in Washington.

It is common knowledge in politics that PACs only contribute to incumbents. Of course, an exception will be made if a well-funded opponent has the financial clout to beat the incumbent. The exception is made because the ultimate goal is not to help any particular candidate but to buy influence.

Cronyism is not new. Eisenhower warned America about a developing military-industrial complex. Daniel Guérin's 1936 book, "Fascism and Big Business" was about fascist governments and their corrupt relationships with big business.

Robert Bradley's recent book, "Capitalism at Work" (2009), contains descriptions of how powerful individuals and corporations have mastered the skills of cronyism. Ken Lay of Enron was widely recognized (and praised) as a world-class player. Ken Lay wrote the playbook for others to follow.

Go to and look at the list of PAC contributions to incumbents in your state. It is not hard to understand why incumbents have an advantage over their opponents. It is equally clear why the PACs make these contributions.

Let me conclude with a pet peeve. There is no such thing as "crony capitalism." Cronyism and capitalism are complete opposites. Capitalism, the economic/political system upon which America was built, is based on free markets; cronyism is based on buying influence to control markets. The term "cronyism capitalism" makes as much sense as "free-market communism."

From Campaign for Liberty

These are not my words, but this is what we are fighting. Freedom and government protection are the same opposites as free-market communism.

No comments:

Post a Comment