Friday, January 13, 2012

Fans of crony capitalism should love Obamacare

Writing in Forbes, Warren Meyers offered this eye catching title, " Crony Capitalism?Blame the Progressives."

Here is how it works as explained by Meyers in his posting in Forbes. See here for article.

Capitalism is simply the free exchange of individuals based on their self interest. There is no room for government subsides,bailouts or any of the other myriad forms of government interventions into the economy that favors one entity or groups over others. Whenever government has the power to dole out favors folks will seek those favors. They will seek out those privileges. The bigger the goverment, the more power to dole out favors, the more favor seeking and the more the targeted few benefit at the expense of the rest.

This privilege seeking activity in the jargon of the economist is called "rent seeking". Progressives as a group favor more goverment power to do all those things that they think wise leaders and technocrats can do much better than the people could do for themselves.Of course, Progressives share the blame with other big government politicians whether they be called big government conservatives or moderates or whatever.

Enter Obamacare as the poster child for what George Will has called the tendency of congress to pass intentions rather than statutes. What we get is legislation that outline an aspiration or a dream or a nice thought and then hands over the details which actually define the actions to various governmental appointees and agencies,who then become the target for possible regulatory capture or at the least effective lobbying efforts the results of which can be described as crony capitalism.

Here is an excellent essay on the nature of crony capitalism versus "Market capitalism" and how Obamacare is a poster child for the former.How does the furtherance of crony capitalism mesh with the alleged social justice that Obamacare was said to represent?

No comments: