Blogs For Victory

The nasty mix of Big Government and Big Corporation:

…President Dwight D. Eisenhower warned of the birth of a military-industrial complex. Today we have a financial-regulatory complex, and it has meant a consolidation of power and privilege. We’ve created a class of politically protected “too big to fail” institutions, and the current proposals for regulatory reform further cement this notion. Even more worrying, with so many explicit and implicit financial guarantees, we are courting a bigger financial crisis the next time something major goes wrong.

We should stop using political favors as a means of managing an economic sector. Unfortunately, though, recent experience with health care reform shows we are moving in the opposite direction and not heeding the basic lessons of the financial crisis. Finance and health care are two separate issues, of course, but in both cases we’re making the common mistake of digging in durable political protections for special interest groups.

One disturbing portent came over the summer when it was reported that the Obama administration had promised deals to doctors and to pharmaceutical companies under the condition that they publicly support health care reform. That’s another example of creating favored beneficiaries through politics…

You cannot have justice if there’s even a little bit of injustice in it – you also can’t have the truth if there’s an element of lie; what is good tends to spotlessness. Right now, we’ve got a free market which is so tightly bound to government and so desirous and dependent upon special favors that it simply isn’t really a free market. It apes many of the aspects of a free market, but just as injustice and lies corrupt justice and truth, so does any special privilege in the market corrupt the free market. What we’ve got is a bastard hybrid – neither socialist nor capitalist; neither entirely free nor entirely servile…but the bad news is that no matter how you slice it and dice it, the people with the best political and corporate connections always wind up with the best part of the deal.

I am a free-market advocate – it is the only way to rationally distribute goods and services; what I want us to do is return to a free market…a market where neither government picks the winners nor where monopolists prevent competition. We’ve got monopolistic winner-pickers, and if you wonder why your 401K is down, your house is upside down, your health insurance premiums are through the roof, your college education is extortionate…well, the place to look is in the offices of Wall Street and DC.

What should we do? Allow failures to fail, and do whatever we can to encourage the new and the small against the old and the large. General Motors is not a sacred element of the United States – its just a corporation which screwed itself in to financial oblivion (with much government help, of course). We can live without GM – but we can’t live without a free market. Someone will make cars in the United States – and if it isn’t a corrupt, failed GM living off taxpayer dollars, then it will be a brash, new start up living off a dream and hard work. Who says that Citi and BofA are immutable parts of America’s financial system? You think that after thousands of years of people going in to banking that they’ll stop doing it if BofA goes bankrupt?

We’ve been sold a lot of nonsense over the years – and as our current crisis picked up steam, the level of nonsense has risen to amazing heights. Its time to have done with it – and done with those who got us in to this mess (with the understanding, of course, that we partially got our own fool selves in to it). Stop bailing out; stop providing special privileges; stop picking winners and losers – help the poor, encourage the hard-working and then just get out of the way.