How Cronyism is Hurting the Economy

Real Estate Agent with Realty ONE Group Mountain Desert DRE #SA554748000

Beyond Bailouts: What Is Cronyism?:

From Wikipedia:

Cronyism is partiality to long-standing friends, especially by appointing them to positions of authority, regardless of their qualifications. Hence, cronyism is contrary in practice and principle to meritocracy. Cronyism exists when the appointer and the beneficiary are in social contact; often, the appointer is inadequate to hold his or her own job or position of authority, and for this reason the appointer appoints individuals who will not try to weaken him or her, or express views contrary to those of the appointer.

It is clear big businesses wield great control over the federal government. How do we stop this so-called crony capitalism, or collusion? Professor Jason Brennan argues that while it may seem paradoxical the best solution is to limit government power. He provides two reasons for this. First, the power to "regulate the economy" is really the same thing as the power to distribute favors, which corporations will inevitably seek. Second, regulations actually benefit big businesses at the expensive of small businesses. Less government power means corporations have less power to compete for, fewer privileges to seek, fewer subsidies to enjoy, and no agencies to capture.


Comments (4)

Steve Hoffacker
Steve Hoffacker LLC - West Palm Beach, FL
Certified Aging In Place Specialist-Instructor


This is why the Congress was only given 17 powers. :)


Jul 28, 2012 04:43 PM
Dale Terry
Yadkinville, NC

Too big to fail is the Obama term for making more monopolies.

Jul 30, 2012 09:31 AM
John Mosier
Realty ONE Group Mountain Desert - Prescott, AZ
Prescott's Patriot Agent 928 533-8142

You are right Dale. Obama got a lot of mileage out of our money. He

  • got payback to the labor unions
  • and his BIG Business supporters like GE
  • and the BIG players in the financial industry
  • while moving our country towards a collapse of the economy at the same time.
Jul 30, 2012 11:29 AM
John Mosier
Realty ONE Group Mountain Desert - Prescott, AZ
Prescott's Patriot Agent 928 533-8142

Steve -- My history is fuzzier than yours, Steve.  Can you name the 17 powers that Congress has granted themselves or simply assumed?

Jul 30, 2012 11:31 AM