Cronyism is an embarrassment to democracy

Cronyism is an embarrassment to democracy

There are many objectionable features of our democratic government that we are glad to have long done away with: slavery, prohibiting women from voting, state legislatures appointing U.S. senators and a whole slate of others.

One that some modern pundits are occasionally tempted to add to this list is crony capitalism. The days of smoke-filled rooms and shady business deals with government officials are a relic of the distant past, they say.

It’s a shame that they are quite wrong.

While it certainly isn’t the case that we are in an age where a few companies and a host of backroom deals in and of themselves shape the national landscape, (although some much more ambitious than me might even be tempted to put forth that argument) it is nonetheless true that the allegedly free market of which we are all constituents is constantly manipulated through businesses seeking preferential treatment from legislators and regulators.

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We tend to think of this phenomenon as limited to a few greedy elites seeking to tip the balance in their favor, or the massive bailout of 2008 that sought to ameliorate the reckless actions of those same elites. But all told, that supposition is rather inaccurate as well.

As the expert on political economy Samuel Gregg notes, crony capitalism “can take the form of bailouts, subsidies, monopolies, access to ‘no-bid’ contracts, price controls, preferential tax treatment, tariff protection and special access to government-provided credit at below-market interest rates, to name just a few.”

In other words, the calculated and measured manipulation of our economy happens almost every day, and we oftentimes are never even aware of it.

Moreover, crony capitalism is so deeply ingrained in the fabric of American life that any effort to curb it altogether seems presently to be essentially futile.

The reason why this is true is actually quite simple: the system, as undemocratic and opaque as it is, works quite well for the parties involved. Politicians do the bidding of businessmen, who in turn provide electoral support right back to the politicians.

Given this information, the unsettling question then arises as to whether cronyism is an unassailable facet of American political and economic life, and the equally disturbing answer is that it just might be.

As Gregg further highlights, eliminating, let alone marginalizing, cronyism “demands significant moral and intellectual fortitude from those in business or politics” — fortitude that, as of now, neither of these parties possess.    

Unlike the other objectionable features of our democratic government that I previously mentioned, crony capitalism still remains with us, and the only way to begin to combat it is for those in power to realize just how gross of a violation of democracy it really is.

In its time, many viewed slavery as a necessary evil that was unlikely to dissipate. Likewise, the idea that women could be allowed to vote, or that U.S. senators would be directly elected by the people was at one point preposterous.

But every one of these violations of equality was rectified, and it was all carried out in the name of democracy.

So too must it be for crony capitalism. For a government that claims to be of, by and for the people, cronyism is truly an embarrassment.

Thus, officials in power must fight the occasional urge to collude for personal gain and consequently decide that cronyism is unjust and corrupting to the body politic.   

We won’t be the gleaming democracy that we purport to be until they do. 

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    BenMar 31, 2016 at 12:01 am

    Drew, you’re really a pretty dirty guy.