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The Government Tilt: How Crony Capitalism Distorts Markets

On June 15, The American Conservative convened a panel to explore the cozy relationships between government and business, and make the case that the growth of cronyism—and the policies that feed it—runs counter to a truly conservative economic policy.  Watch the full discussion here. [1]

The panel featured:

Ambassador C. Boyden Gray, former Ambassador to the European Union (2006-2007).

David M. Smick, author of The Great Equalizer: How Main Street Capitalism Can Create an Economy for Everyone [2].

Tim Carney, commentary editor at the Washington Examiner.

Veronique de Rugy, senior research fellow at the Mercatus Center at George Mason University.

moderated by Robert W. Merry, editor of The American Conservative.

28 Comments (Open | Close)

28 Comments To "The Government Tilt: How Crony Capitalism Distorts Markets"

#1 Comment By Adriana I Pena On June 20, 2017 @ 10:43 am

Whether we like it or not, America was built on crony capitalism. Be it Hamilton’s policies which set the groundwork for industrialization, or be it the massive land grants for railroads, they made America what it is today.

It was called “the American system” and as such was copied by Prussia in the 19th century, with the result that an agricultural backwater turned into an industrial powerhouse that two World Wars could not destroy.

There may be arguments why that model is no longer needed. But to posit a pristine time when none of it happened, and how it was spoiled by crony capitalism, is basically not knowing your history.

#2 Comment By KD On June 20, 2017 @ 11:47 am

Its not the truth that Communism has been tried and failed, its that true Communism has never been tried, erh, I mean true capitalism. [insert post-1789 ideology here.]

#3 Comment By Nicholas Needlefoot On June 20, 2017 @ 12:08 pm

To Adriana Pena’s comment, I’d add the Homestead Act, the Erie Canal (state government), and pretty much any time government force was used to removed Indians from land, allowing for the widespread distribution of land ownership that did so much to make the U.S. a country of middle-class folks.

As others have pointed out, there’s a Libertarian vibe to these Crony Capitalism articles. Like there’s a “true capitalism” or a “true free market” out there. There isn’t.

#4 Comment By No to neos On June 20, 2017 @ 12:23 pm

In my little town, my city council during the past few years has:

* pledged hundreds of thousands of dollars of annual “sales tax rebates” to the region’s largest car dealer. The reason: He expanded his dealership. The agreement says the total amount of the rebate may not exceed the total amount of the expansion. In other words, taxpayers could pay for every penny he spends. Meanwhile, smaller car dealers in the area pay every penny the local governments can get.

* pledged up to $1 million to a multi-national retailer that no doubt would have opened a store here anyway. That retailer of course is taking business from our smaller independently owned retailers, whose taxes help fund the competitor that is taking business from them.

* bought an office building for $1.1 million, knocked it down, prepared the lot for development, and “sold” it to a real estate developer for $10. Yes, $10. After having spent well over $1 million to buy the property and prepare it for development.

* built a new sewer plant and sent sewer/water rates skyrocketing to pay for it. Then, just weeks before the plant was to go on line, the city set aside 25% of the plant capacity for a real estate developer who announced plans for an industrial park. Technically, on the day the plant opened, it was already beyond capacity. The real estate developer paid exactly $0 for it even as homeowners and businesses around town are paying millions of dollars more for it.

The amazing thing is, many people seem okay with all this (and there are other examples like these I could give). The Chamber of Commerce, the Economic Development Corporation (which is made up of local economic development directors, mayors, city councilmen, big businesses, etc.), the local newspaper, all tell us these are great moves because it’s economic development.

At the same time they tell us these things, many storefronts are empty, people are still walking away from houses that are underwater on their mortgages, property taxes and local sales taxes are going up, etc.

#5 Comment By Adriana I Pena On June 20, 2017 @ 2:59 pm

@KD

“It is not the truth that _____________ has been tried and failed. It is that ______________ has never been tried”

I think that Chesterton said something like that about Christianity.

Because all ideologies and religions are True Scotsmen.

#6 Comment By GregR On June 20, 2017 @ 5:23 pm

Meh,

The real bell weather is the state of Louisiana. We give away more money in business rebates than we receive in business taxes. The state would literally increase revenue by eliminating the entire business tax code.

The chamber of commerce still runs adds claiming business taxes are too high.

#7 Comment By EliteCommInc. On June 20, 2017 @ 7:16 pm

Responses as I watch the panel

Certainly, government money in the market business has drawbacks and should be used with consideration and rarely.

But the US was built on capitalist market system. Where an individual created a product advertised a skill, owned something that others would be willing to pay for.

Has the government participated in that process. They have and it has been at times counter productive.

But laying to claim that government money built the country could not be a sustainable argument. The issue as to the usefulness of government dollars is what it produces in the end. I worked for a government contractor and the bottom line was performance. The end result of that performance was a better product and a reduction of repeat performance. Success saved dollars — period. This is particularly important when it comes to government contractors.

Part of the dilemma is which company can produce a product at least cost, but provide the best quality as well. Low bid blind contracts do not always get the best quality provider.

The government did provide land grants, but such grants were also provided to private citizens to do make their lives, fortunes and ways as they saw fit. Free land or land at discount prices for millions of people to chart their courses. And in both of the early cases — it was the product that demonstrated the wisdom and value of such practices by government.

____________________________

What is disruptive today and has been for some time is that government has shielded business (large businesses) from the consequences of poor financial decisions. And have done so by burdening tax payers.

They have allowed increased penalties for consumers, but relaxed similar accountability for business. This nexus where government is married to business exacerbates the imbalance as business makes money even when hey fail.

The business community and government have become a closed loop. This going to continue until that system is completely shattered by denying any elected official to serve on any financial stake holder board or hold stocks in any industry that the government is also responsible for regulating.

You want to serve in government — that’s why the tax payers render you a salary. Which begs another question. The federal government should only be providing a stipend for members of Congress. As reps from various states, their salaries should be paid by their states.

Theirs nothing wrong with private contractors. They provide a service. The idea was that they could provide that service cheaper and with better quality, that demands a audits on multiple levels.

And failings are not always contractors faults. Government says it wants X. Company produces X. Government the modifies what was provided. Company goes back to drawing board modifies product – delvers. Government wants more modifications. The end result is delayed contracts, and cost over runs and all of the bureaucracy that goes with it.

I think Amb Grey does a nice hob of laying a foundation for part of these issues. The Big Springs Texas story is great.

Capitalism is not the problem here.

#8 Comment By TR On June 20, 2017 @ 8:07 pm

“No to Neos”: The crony capitalism you describe has been around ever since the forties in the South at least. But it has certainly gotten more outrageous. In Florida at least there is some opposition to it now among state legislators. At least they are refusing to fund new professional sports stadiums.

Maybe one good thing to come of Amazon.com is that large retailers will no longer be welcomed at the public trough.

#9 Comment By EliteCommInc. On June 20, 2017 @ 11:50 pm

Mr.David M. Smick, should have addressed the financial crisis and how consolidation made accountability hedged against the international banking policies of Basel I and Basel II. That Davos, Tammany Hall exchange was more telling than it sounded. It would have been interesting to hear the redresses.

Mr. Tim Carny’s comments, I heard many years ago that conservatives have tort reform all wrong. most tort law and policy has resulted from corporations battling each other over patents, use, infringements etc.

The regulation mess seems to reflect a similar dynamic save, they are bypassing the courts and going right to the lawmakers to protect their interests thereby bypassing the consumer. It’s disturbing that lawmakers who claim to be capitalists son’t respond with a free market response.

“Lobby the consumer. That’s what advertisers are for.”

#10 Comment By Kirt Higdon On June 21, 2017 @ 12:07 am

Cronyism (favoring your friends) will always be with us under any system as will nepotism (favoring your relatives). What’s more, while abuses are common, there is nothing intrinsically wrong with cronyism or nepotism. Who are you supposed to favor – your enemies and complete strangers?

#11 Comment By EliteCommInc. On June 21, 2017 @ 1:34 am

Well Miss, Ms Veronique de Rugy,

O now know the to code is not only complex because of lawyers but via the manipulative tactics of corporate lawyers getting carve outs and special exemptions to the exclusion of tax payers and or the hedge against them.

I think in your explanation, I might have missed the reference as to why companies who operate outside of the US still get the benefit of US exemptions and special discounts.

Amongst the last three panelists, I think it was the case that they referred to “our companies” meaning, I think US owned or operated. I think the days when the Us states could expect loyalty from the corporate are long gone.

I may have missed any references to the convoluted relations between financial institutions, other large business entities and ratings agencies and auditors.

#12 Comment By KD On June 21, 2017 @ 6:44 am

Any political system requires decision-makers.

Outside of a consolidated autocracy, like the USSR after Stalin consolidated power, or Mao after 1958, the decision-makers rely on influentials for support, and make decisions that benefit influentials, because if they don’t the influentials will have them replaced.

This is true under “communism”, “capitalism”, and “fascism”. As far as institutional religion, the same power dynamic works itself out, giving rise to the “true Church” vs. the “church”.

Further, in the consolidated autocracy scenario, the concern of the leader (having neutralized the influential threat) is avoiding popular uprising. Independent economic activity by the people also means people can freely associate, speak and organize resistance against the regime. That is to say, in a consolidated autocracy, you want to keep your people fragmented, repressed, relatively hungry, and terrified. Some kind of “true capitalism” scenario would provide the people with enough freedom to stage a mass uprising.

Hence, regimes like North Korea are not capitalist paradise, although perhaps the leader is safe from threats coming from within the inner circle.

“Free Santa Clause and defeat the corrupt status quo” may be a nice banner to rally the useful idiots and grade school children, but is it useful for grown ups who know that Santa Clause doesn’t exist.

One of the impediments to the modern Right is the belief in Santa Claus and his magic bag of market-based solutions to all the worlds problems.

#13 Comment By KD On June 21, 2017 @ 6:48 am

The real political question is not how to purify capitalism, but how to make capitalism serve the interests of our people, and not other people. This question is neither inherently left or right.

#14 Comment By MEOW On June 21, 2017 @ 8:06 am

Adam Smith opined that some level of integrity is required for markets to work properly. I am seeing less of this ethic. The biggest price setting organization in the U.S., aka the Federal Reserve System, with more power than any branch of government, is not “Federal” but “Foreign” and run by an inner and exclusive cabal. Sorry Adam – we gave the shop away away when we passed the Federal Reserve Act in 1913. Give control (creation, expansion, contraction) of our money supply back to the U.S. and chase the money lenders from the temple. No more too big to fail rubbish. As of writing the game for average citizen is fixed and desperate.

#15 Comment By Joe the Plutocrat On June 21, 2017 @ 9:22 am

Plutocracy is a form of oligarchy and defines a society ruled or controlled by the small minority of the wealthiest citizens. Or, as the saying goes, it’s good to be king. I realize calling out the founding fathers is political blasphemy, but political blasphemy is an oxymoron, per the 1st Amendment (the founders were nothing, if not masters in irony. ‘laws, right, the Constitution, the establishment clause… stop it guys, you’re killing me. the Constitution (individual rights) is the ultimate ‘bait and switch’. Americans believe they have political power – nonsense. WEALTH has power and the system is set up to protect or consolidate wealth. what would you expect from white (predominantly) Christian, property owning males. And it kind of worked until about 40 or 50 years ago, but it is becoming obvious the model is not sustainable.

#16 Comment By rhine-gold cowboy On June 21, 2017 @ 10:32 am

The reality of the situation is, and always has been Peter “Competition Is For Losers” Thiel, who said “I always want to be a monopoly”.

That includes any form of corruption necessary to influence whatever politically-appointed watchdogs might be set to prevent restraint of trade.

I learned the other day from Yuval Levin’s “Homo Deus” that Thiel is the world’s single largest investor in anti-aging technologies. Apparently, he is sinking hundreds of millions into the field and intends to live forever, if possible. Someone–can’t remember if it was Spengler or Sorel or Carlyle, one of those guys–once said that the duty & destiny of most of mankind was to work & die so that the few could achieve transcendency. Perhaps monopoly, channeling vast profits to a tiny elite at the top, is the means of achieving this.

Alex Jones, who is generally ridiculed as a bafoon, was onto something when he asserted that the intent of elites was to “upload their consciousness to immortal machines and set out to explore the cosmos”. Think of that when you pay your Comcast bill, or go to buy something on Etsy and you have to use Paypal like it or not.

#17 Comment By EliteCommInc. On June 21, 2017 @ 12:26 pm

“Adam Smith opined that some level of integrity is required for markets to work properly . . .”

Opined nothing. Central to how any system operates is the integrity of the players to abide by the honest standards and practices. Government is the arbitrator second to personal integrity which is second to the real consequences in the market of misbehavior.

And that is one area in which government has counter balanced in business’s favor. The answer is in fact removing government’s role as player more than arbitrator to fairplay.

Of course wants to control the market, but unless taht control is derived from the consumer or the buyer attending to that product or service short changing by violating the law to create that monopoly is in violation of Constitution’s purposes:

” . . . establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, . . .”

As i read through the comments there’s not a single one that would not be redressed positively by some “purification”. What Mr Adam Smith noted is not part of ny other system . . .

that is how consequence serves as motivator and moderator for fair play.

#18 Comment By Winston On June 21, 2017 @ 4:17 pm

@No to neos At federal, state, and local level big business is favored over SMEs. That’s one of the reasons for US decline.
@Joe the Plutocrat
America has evolved. What works at one time, will not work at another. It requires good leadership- to change course. But that has been where US has been deficient for a while.
Now it is too late. The future will become obvious when majority of poor kids in public schools enter work force-one way (formal) or another (informal).

#19 Comment By Winston On June 21, 2017 @ 4:59 pm

Adriana I Pena In colonial America, US started with shared property and town meeting form.

Please see:
The Germanic Origin Of New England Towns. Read Before The Harvard Historical Society, May 9, 1881
by Herbert Baxter Adams

Then to crony capitalism and representative government. Hmm.. maybe they went hand in hand?

#20 Comment By Winston On June 21, 2017 @ 9:31 pm

Michael Krieger, who used to work in Wall Street does not mince words:
[3]

The U.S. Economy is a Perverted, Neo-Feudal, Rent-Seeking Abomination

#21 Comment By MEOW On June 21, 2017 @ 10:27 pm

Adam Smith did indeed opine exactly as I stated: “Smith delineates two levels of virtues. His lower or commercial virtues are self-interested ones and include prudence, justice, industry, frugality, constancy, and so on. Another set of virtues, the primary or nobler virtues, includes benevolence, generosity, gratitude, compassion, kindness, pity, friendship, love, etc. Although there is a hierarchical relationship between these sets of virtues, Smith explains that there must also be a balance or harmony between them. In the economic sphere, self-interest allows men to operate on the lower level of virtue and yet attain the greatest benefits for society as a whole. A man need not be totally virtuous for the economic system to function to maximize wealth. The lower virtues are at the base of Smith’s value theory and his determination of market prices. Smith explains that, as people get beyond the level of primitive economy to enter an advanced society and civilization, there arises the opportunity to develop higher virtues.”

#22 Comment By Adriana I Pena On June 22, 2017 @ 8:40 am

@Elite CommC

I did not say that government money built the country. Only that it was there at major turning points. You might argue that the Homestead Act was not REALLY the Government action. But the fact remains that it was a Government decision that started it.

And let us not talk about the railroads, built only because of a major Government giveaway, that chose winners and losers.

Evidently such actions can be wise or they can be foolish. There seems to be a lot of foolish actions and the debate is not helped by those who cannot tell the difference between wise and foolish – and either condemn all giveaways in toto or praise them

If I were to make rules I would say “supporting a mature and maybe decaying industry is foolish, unless it involves a technology upgrade” “Supporting a new technology or a new industry can be a wise investment” (which is why it is a good idea to fund basic research). “Providing for a major industry that makes something that all other industries need is wise” (Which means among other things transportation – because all other industries depend on it)

I wonder if we had an industrial policy of any sort we would have the scarcity of skilled workers today? Industries went along thinking that society would continue to provide them with skilled workers as it had done in the past, and no one noticed the push to go to college, and the disdain for technical training. So, now it has sprung on them that there are not enough for what they need…. And yet in Germany, when they started to industrialize, they paid attention to the training of the work force, and now they have apprenticeship programs that we would do well to imitate.

#23 Comment By EliteCommInc. On June 22, 2017 @ 1:04 pm

“One of the impediments to the modern Right is the belief in Santa Claus and his magic bag of market-based solutions to all the worlds problems.”

I am unfamiliar with the idea of Santa Claus as a icon of free market, though I certainly understand his commercial value. When one speaks of capitalist systems they are not the stuff of libertarian fantasies, running about willy nilly. And there is no guarantee of success for entrepreneurs.

Capitalism is not akin to communism, what toy re describing is the removal of a capitalist system, which reflects the power dynamics where a few dictate to the rest. There are always going to be people who have more and by having more will be able to exert more influence. I don’t anyone who supports capitalism would pretend that is not the case. No sincere capitalist would support structuring business and market forces to unfairly corner markets, shut out competition. What the four speakers lay out reflect the results of a shrinking capitalist system. So each of these complaints are to capitalism they are to undermining that system. In otherwords, what JP Morgan did to Westinghouse and Tesla was totally out of bounds to any ethical standard. And judges should have responded to the blatant tactics with “cease and desist” mandates. Now I would admit to some naivete’ about corporate behavior, I have generally accepted that they are men and women of sound integrity but it is becoming clear that they are not capitalists nor are they free marketers and there is no such thing as “pure” capitalism. I accept that there are reasons to engage in some protectionist or regulatory measures. Because history demonstrates that our corporate heads have a difficult time exercising restraint and ethical processes among their executives and staff.

What Michael Kreigal chronicles is not capitalism – unencumbard from mechanisms of accountability is considered mercantilism, branched from the very abused and incorrect analysis of evolution’s “strongest and the fittest” notions of life.
___________________-

Once again off to to some narrative but tangentially related to the thrust of my contend.

1. Sure government money in this case in the form of grants has occurred and certainly there was and remains manipulation.

2. The scale of grants in these scenarios also went to individuals and I would say both in scope and value exceeded anything in US history.

3. The results from both with respect to production value made those positions wise, astute and successful investments for million of people and in turn the US in total. The value generated from home ownership in invaluable over time not by what it does financial but what it has birthed in terms of the notion of individual exercise over their lives. And more importantly what it accomplished in terms of family wealth creation and I don’t mean the rich.

Uhhhhh, well, if you understand the country’s founding, then you are mistaken. When the Europeans extended their reach to colonize this hemisphere, it operated on the notion of property for ownership. You either bought a parcel of land of worked to own it (rent to own). And in many cases, the settlers set up shop without any government assistance at all. The westward expansion was due directly to this premise. One could just pick up stakes and head out. Incurring most of not of the risk. Furthermore, it is often an over looked reality, that many businesses and families came her with a stake all their own with no connection to government at all. Pointing to those instances of land distribution by government and then claiming — it’s government that is the cause is to misunderstand the country. For those colonizing under the British flag, all one needed was permission, if they were not British citizens to settle.
——————–

“If I were to make rules I would say “supporting a mature and maybe decaying industry is foolish, unless it involves a technology upgrade” “Supporting a new technology or a new industry can be a wise investment” (which is why it is a good idea to fund basic research). “Providing for a major industry that makes something that all other industries need is wise” (Which means among other things transportation – because all other industries depend on it)”

Uhhhhh, good for you. But how that relates to the value of the discussion in terms of critiquing our current economic system is unclear to me. Sure upgrading technology can be helpful. But if is not viable in respect to economic terms – it doesn’t dd to wealth creation for individuals. Take for example, solar power, arguably the single most important viable energy resource available. It will be around as long as the earth and perhaps longer. The problem is no one has developed a means of harnessing its use that is cost effective enough to be desirable, on its own accord. Hence the government subsidies all across the country to get people to buy in. If an energy source is effective and affordable it won’t need subsidies. Again, it the shell game of tax payer subsidizing systems that as of yet don’t work. An upgrade that doesn’t work, is a burden. In the case of solar power a burden on the tax payer. Examine the vast problems in Europe – it’s a bust.

Clearly, the best means of determining a effective investment all things being equal is the market and people’s access to it. Uhhhhm if an industry, and individual, a company thinks they have a product worth the investment they should pursue it. Whether the federal government which you incorrect lambaste in the effort should be a part of said research is a tougher question, but clearly, you are contradicted yourself here. Afterall, when government chooses which entities to invest public dollars they are in fact, picking winners and losers — something you have gone to great strides to condemn. Here’s a winner picked Solyndra.

Case in point the games played the CA motor association on patents of the automobile that prevented Henry Ford from developing, building and selling cars. Had government not decided that the patent laws were being unfairly applied, non-government involvement would have sealed a monopoly on an idea.

Henry Ford, revolution every production standard world wide and changed the forever the dynamic of what it meant to be a corporation and and employee of the same.

Your further comments are a blur as to their relevance. Whether government should be intimately involved in the process is another discussion aside from providing financial resources — land grants as it were. Which our government does by the billions in grants and small interest loans for citizens endeavoring to start or expand an existing business. So I am unclear why this point is salient for someone who challenges the behavior of government involvement from the mid 1800’s. No one that I know who has commented has made a case that government shouldn’t be exercising due diligence — best practices, fair accounting and ethic.

The federal government should not have am industrial process that it enforces across the board. It stifles creative problem solving. What anyone who has ever started a business will tell you is that it hard. But the stress created results in new and innovative solution. Government regulation in terms of that is detrimental. Of course I am not arguing for unrestricted accounting — its obvious that just does not work.

I am going to reject the German analysis. In my view the kinds of hedging that Germany engages in with their EU market practices exceed fair play. But that’s Germany and EU they have their own rules, ethos and practices.

“Industries went along thinking that society would continue to provide them with skilled workers as it had done in the past, and no one noticed the push to go to college . . .”

I have never worked in an industry that did not train it’s employees or make it known what was required to an entry level position. And I have known but few who did not make exceptions for exceptional talent.

This is the excuse made for outsourcing and importing to the goal of cheap labor. And the issue that is relevant, is that the federal government has actually partnered in undermining the US citizen from labor. In the US it is generally understood that a company does and goes where it will to do whatever it is they choose to do. In this case the tax payers are funding their departure and their importing of people that actually work against the interests of the US citizen. It is a violation of the Constitution for the government to do this. She has no mandate to suborn the decrease in in opportunity to the Us citizen. I belonged to an organization ages ago called ASTD. I think we parted ways because of the use of so many foreigners and the encouragement to the same. That is another issue. But clearly you can make a case for training and development of US citizens if there is a need without the curious critique incorrect as it is of government and its relations to capitalism.

And no, the federal government should not be responsible to training people for private companies. That is an investment they should make to their stead. If they choose to go elsewhere, they lose and and all tax advantages and protections of the US tax payers. That is totally their choice.

I for one believe that the US citizens is as productive, creative, hard working and committed to their well being as anywhere else on this planet, more so in fact. I say that without being a huge fan of the people per se, tossed as they can be by every wind and fancy made to frighten them into a dependence on government with it’s unhealthy marriage to financial markets and businesses.

Some examples of detrimental gambits:

SSC
Medicaid

All intended to be temporary assistance, now intractable lead weights around our necks, poorly managed and distributed. If you are a US citizen and want to exercise some creative thinking of upgrade, feel free to tackle those systems with my blessings.

But applying faulty analysis of what capitalism does and what government did against what it should do is unhelpful.

While incomplete, I think my responses have weight via the data sets.

Amtrack a test case in government transportation right along side Solyndra Solar.

#24 Comment By EliteCommInc. On June 22, 2017 @ 1:16 pm

“Whether we like it or not, America was built on crony capitalism. Be it Hamilton’s policies which set the groundwork for industrialization, or be it the massive land grants for railroads, they made America what it is today.”

I was going to let this slide —–

“Whether we like it or not, America was built on crony capitalism. . . .

And given your description of what crony capitalism means —

Government money built the country is what you said and that is exactly what you meant.

#25 Comment By Adriana I Pena On June 22, 2017 @ 7:48 pm

@EliteCommInc

Government money put in the right private hands DID build the country.

Unless you are writing a revisionist history that explains how the railroads were built with purely private capital, or how Hamilton’s measures led to a catastrophe.

Anything is possible.

Yeah, you would have liked the US to be pristine from its beginnings, and owe nothing to government giveaways and favors. But reality was a little messier than our dreams.

Alas, the railroads were needed at that time. They were also a source of corruption at a level that would make us blush.

Do you think that railroads had something to do with the economic developent of America?

If not, explain why.

Check for the corruption in railroad building

[4]

#26 Comment By EliteCommInc. On June 26, 2017 @ 5:54 pm

“Government money put in the right private hands DID build the country . . .”

Should you wish to modify your comments, that’s fine with me. I have already indicated that the federal government makes investments via private entities. But government funds alone did not build the the US. In fact, it’s clear that what is required for the US capitalism which is by definition individuals engaged in private enterprise (via fair and honest dealings) is the cornerstone of America’s growth by way of investment and production.
________________________________

“Yeah, you would have liked the US to be pristine from its beginnings, and owe nothing to government giveaways and favors. But reality was a little messier than our dreams.”

I have no idea what this is response to. It seems to suggest that I made a contention that the economic system is devoid of misdealings, whether with private or federal dollars. I think the record on my position makes no such advance or even suggestion. I have no doubt that individuals and business entities have misused the mandate for funds provided by the government or private investors.

You seem intent on making arguments attributable to me, I have not made. You made sweeping accusations about how the country was built — on federal money. You made accusations about the failings of capitalism.

I challenged the assertions and provided rational and examples of why it was not only federal dollars and why capitalism remains a viable system today despite behaviors that violate its principles. It has been governments inappropriate response that is an issue.

As the panelists layout — government welfare’s growth hindering the country.

#27 Comment By EliteCommInc. On June 27, 2017 @ 9:42 am

“Do you think that railroads had something to do with the economic developent of America?

If not, explain why.”

This has got to be the one of the most bizarre questions, I have been asked to answer. Your point of course is to bind me into some peculiar contradiction. as well as change the tenor of your initial advance. but that doesn’t help you much.

This is what you relate your comments to something I actually said or advanced and I will address this issue specifically.

#28 Comment By Adriana I Pena On July 1, 2017 @ 4:21 pm

@EliteCommInc

I just wanted you to acknowledge that crony capitalism is woven in the fabric of the US from the beginning. And that trying to extirpate it might also, as the Bible says “pull the wheat along with the weeds”.

Could we have done without all the corruption that went in building the railroads? Are we glad we got the railroads, anyway, with the government choosing who got the cheap land and who didn’t? Yes to both of them.

Crony capitalism is the name of the game in Asia in their path to prosperity. It was the name of the game in Prussia and the Second Reich.

There will always those who profit from a close relationship with the government. The trick is to choose those who give something in return. Those who practice “honest graft”.

Eventually a capitalism without the cronyims will be possible. But today is not the day.