Shopping is not one of my favorite activities. But when I find a good deal, I feel like I found a little piece of heaven! When a good deal is discovered, I’m not only anxious to purchase the product or service, I feel like the trade of my money for the product or service provided to me is a win for me. The interesting part is that it is also a win for the individual or company that sold me the product or service. After all, they weren’t forced to sell it to me. In a free market, currency, goods and services all trade hands because all parties involved in the transaction desired it. As soon as we introduce the government to the equation, things can get quite messy and liberty can be destroyed.
When government gets involved with a transaction, it brings force — not more freedom – to the transaction. If force is necessary to make the transaction work, you can bet that one of the parties is not feeling very good about the transaction. In many cases it is the taxpayer who is feeling ripped off. When force is used for the purpose of government gain, political gain, or special interest gain (think lobbyist or big business), the free market and the principles of freedom are no longer in play. This is called, “Crony Capitalism.”
The government inserts itself into the “free market” system in various ways. Following are just a few of these.
• Licensed or Certified: When government requires licensing, it adds additional requirements for anyone to be involved in a product or service. This has the effect of increasing prices, as well as protecting existing and larger business by increasing the barrier to entry. This in turn makes it more difficult for the little guy to start and compete. Who is hurt? The consumer can only choose from licensed providers at their rates; they are not free to choose someone who can do the job for less, but just simply does not have the government’s stamp of approval.
Have you ever met a great teacher that can’t teach in schools because they do not have a certification? How about a great salesperson that can’t sell his neighbor’s home because he doesn’t have a real estate license? Government argues that we must protect the consumer. Doesn’t a free market do this? Consumer protection services are available for every product and service imaginable. Referrals or references are of more value than any piece of paper from the government. If we get to pick who we want to do business with, are we not better off in the end? Given the existing system with teachers, are we better off with a lousy yet certified/licensed teacher?
• Lobbyists: I have yet to meet a lobbyist that didn’t have a great way to spend taxpayer money. Businesses consistently get a better return on the money spent on lobbyists than any other investment! Spend a few dollars to wine and dine a legislator, promise campaign contributions, and receive contracts worth up to billions. Companies regularly buy influence with politicians by contributing to their reelection campaigns. Just ask Trump, he is a man who freely admits to this give-and-take scheme. Clinton has been on the receiving end many, many times.
Special interests, unions, and others know that “their” politician will vote their way if they can help keep them in power. In general, I don’t have a problem with lobbyists. However, we should all have a problem with our representative representing someone or some cause other than our interest or our country’s best interest. Too often one politician scratches another’s back, who in turn scratches another’s for spending we simply can no longer afford, all for the benefit of campaign funds.
• Regulation or Lack of Regulation: In general, legislators make the laws, and then the Executive Branch of the government executes those laws based on the constraints laid down by the legislature. However, it is very common for the Executive branch of government to extend its grip on power in reaching beyond these constraints by adding regulations or rules that benefit some companies – and remove or not enforce other regulations that benefit others.
Lobbyists and company representatives work with regulators to insure the benefit of big contributors. Again, because the government is involved, the free market is not allowed to work as it should.
• Judges Deciding Cases Between Corporations and Trial Lawyers: Many judges are elected and know that it only takes one big case involving a lot of money that could cost them their next election. Judge one way and the corporations will be happy. Judge another way and the trial lawyers and their unions celebrate. Influence peddlers that contribute to a judge’s reelection campaign can wield tremendous power over a judge’s ruling.
• Subsidies, Aid, Grants or Tax Breaks: This is just another way government can directly influence the success of one group over another. Let us not forget that the only way government can give money to one group is to take it from another – by force.
It seems, and I think it would be accurate to say, that we no longer live in a free market, capitalist society. Corruption in the form of crony capitalism rears its ugly head in every part of our government. Is it any wonder that groups around the country protest corporations who receive huge government bailouts? Other groups protest government’s willingness to sell them out. Isn’t it incredible that many of these same people think Socialism is the answer? With some twisted mental gymnastics, they have come to the conclusion that if government controlled everything, government corruption would go away.
I think most would agree that corruption, no matter what its form, is detrimental to a society and an economy. A free market is truly free. Capitalism is not the problem. The corruption that crony capitalism brings is!
In most cases, force from government is not necessary. A truly free market will punish those who do not return a good value and reward those who provide a true win-win, and in addition, will accomplish the trade of goods and services in the most efficient way possible.
Just as the politician who is looking out for his or her own best interest, we as a people need to recognize crony capitalism and look out for our best interest. It is important that freedom loving people everywhere help our politicians understand that freedom, and not that corrupt influences of others is in their best interest.
We must replace those politicians who insert the force of government where it does not belong and disregard the importance of capitalism and free markets. If a new conservative party is the answer to a brighter United States, it must support capitalism and shun crony capitalism.