Tuesday, November 15, 2016

What Is Cronyism and Why Is It a Cancer?

What Is Cronyism and Why Is It a Cancer?

Many people equate free markets with “business.” So when people in the business sector get special favors, regular folks conclude that capitalism is a “rigged” system.

In theory, this false impression could be offset by an aggressive educational campaign by those who support free enterprise. Unfortunately, that task is rather difficult since many people assume Republicans are the pro-capitalism party. So when they see the GOP favoring corrupt handouts to business such as the Export-Import Bank and the sleazy ethanol program, they conclude – once again – that capitalism is rigged for the politically powerful.

Cronyism is a cancer that compromises and erodes genuine capitalism.

And the battle to separate capitalism from cronyism is further hindered when major figures in the business world (such as Warren Buffett) get in bed with government.

Another example is Elon Musk, the head of Tesla, Solar City, and SpaceX. He is known as a visionary entrepreneur, which is good. But Andy Quinlan of the Center for Freedom and Prosperity explains that he also has put taxpayers on the hook to underwrite and prop up much of his business activities.