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happiness

Why is cronyism so intrinsic to the mixed economy?

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By cronyism, I mean the phenomenon of businessmen using the government as a club against their competitors. In my debates with leftists, I find that they are often deluded by the idea that they can purge the government of lobbying and cronyism while maintaining the controls by electing truly selfless politicians who only care about something along the lines of "the public good" and are therefore incorruptible. I know this idea never works anywhere...my question is how to explain why. The best answer I can come up with is that there are no so such things as unselfish human beings and "the public good." Regulations, being violations of individual rights, are inherently unfair and arbitrary, and unavoidably harm some businessmen more than others. Thus regulations create a lawless environment in which the incentive is not to innovate an excel, but to manipulate the regulators to your advantage, because if you don't, someone else will. Any corrections to or expansions on this would be welcome.

Edited by happiness

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...  regulations create a lawless environment in which the incentive is not to innovate an excel, but to manipulate the regulators to your advantage, because if you don't, someone else will. 

I agree. Most of the time, "cronyism" is not a primary causal factor, but a symptom. Too many libertarians decry big companies for their cronyism, rather than acknowledge that this is simple a result of altruism-inspired purposes of government, widely accepted by voters. 

 

Consider an entrepreneur whose business is based on innovation: for instance, many of the big silicon valley names. At some point, each of them gets a Washington lobbyist. They have to: at least to defend themselves, but often to use the system against others. At some point, they realize that this is the only way to play the game if one wishes to survive.

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Cronyism is natural in a mixed economy at least for the following reasons (I suspect):

 

1.  Even if government were run by uncorruptible people who strove to achieve the public good, that "public good" because it is forced, is arbitrary, subjective, and the opposite of good. 

 

2.  A government is an economic force, which in its pursuit of "public good" can "benefit" individuals and organizations: this leads to attempts to participate in the achievement of that public good (for money) and/or attempts to help define (or persuade the incorruptible statists of) what the public good IS, and what would serve the public good.  Entities concerned with profit in the context of a mixed economy will tend to seek out all opportunities which are not illegal in that society.

 

3.  Public good in a statist and particularly leftist context requires victims for its achievement.

 

-->

 

The net result is some become victims of government violating their rights while others benefit and profit from the violation of those rights.  This may be a broader definition of Cronyism but I think the basic idea applies to any kind of cronyism.

 

Bribery, and misconduct are not required for cronyism... all that is needed is a flawed system and a misunderstanding of morality and what constitutes a proper society, on the part of its actors.

Edited by StrictlyLogical

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