Crony Capitalism, Explained

From the Las Vegas Review-Journal:

A tiny amendment buried in the federal transportation bill to be signed today by President Barack Obama will put operators of roll-your-own cigarette operations in Las Vegas and nationwide out of business at midnight…

I had only heard of these types of operations about two months ago – a friend of mine pointed out that you can get a carton of cigarettes a lot cheaper at these places where you buy loose tobacco and cigarette papers and then “rent” the rolling machine to turn out the finished cigarettes.  As a smoker, I was thinking about trying it out.  Now I won’t be able to – something slipped in to a bill (and what does a highway bill have to do with tobacco) has killed it off.  Businesses will be shut down, people lose their jobs…why?  Well the linked article notes that Senator Max Baucus (D-MT) got the item inserted in to the bill and that Senator Baucus is a major recipient of tobacco-industry donations.

But don’t any of you out there get all “darn Democrats” about this – while Democrats do this sort of skullduggery more often than GOPers, Republicans do engage in it.  What Baucus did was a two-fold item in favor of both Big Government and Big Corporation.  Part of the reason for the cheaper price is that loose tobacco is taxed at a lower rate than tobacco in cigarettes.  The other part of the reason is that the major cigarette makers were starting to feel a pinch from the competition (and that, of course also jeopardizes the government revenues from the ill-famed tobacco lawsuit settlement).  Essentially, Big Government and Big Corporation go together and legislated out of existence the people and their small businesses because Big Government needs revenues and Big Corporation doesn’t like competition.

And this is what is wrong with America:  it is no longer governed in any way, shape or form in the interests of the people.  It is actions just like this which ensured that instead of having 50 different car makers, we only had three miserably incompetent car makers, two of which needed a taxpayer bailout.  It is actions like this which ensure that only a few behemoth banks run our financial system (and run it in to the ground, and then demand taxpayer bailouts).  It is actions like this which shut down things like the Keystone pipeline but shovel taxpayer money at Solyndra.  This is why our economy doesn’t grow; why our factories are in China, our mines are in Chile and our farms are in Mexico…because Big Government and Big Corporation like it that way; it works out best for them…they see it as maximizing government revenues and Big Corporation profits.

The reason our economy doesn’t work is because of nonsense like this – the people are hamstrung and essentially forbidden to do anything which might lessen government revenues or harm the profits of the corporations which currently rule the market (and donate to the office holders – Baucus has been in the Senate since 1978; and he’s just dancing to his master’s tune).  Do we want jobs in this country?  Do we want to restore the middle class?  Do we want an America which makes, mines and grows most of its own things?  Then we need an America where the government is prohibited from legislating out of existence legal businesses and where corporations can’t buy legislation to restrict competition.  An end to Crony Capitalism is necessary for the revival of America – and that means an end to Big Government, as well.

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44 thoughts on “Crony Capitalism, Explained

  1. Amazona July 8, 2012 / 1:51 am

    I suggest that another problem is that of omnibus bills.

    Imagine what our legal system would look like now if, for the past 100 years, every bill had to be no longer than 100 pages, had to actually be written by its sponsor(s), be accompanied by a brief explaining how and why it complied with the U.S. Constitution, and was about only one thing.

    When we have a system where completely unrelated things can be lumped in together in one bill, we end up with pork barrel projects and special interest legislation because they are included in worthwhile bills that can count on a lot of support.

    • Mark Noonan July 9, 2012 / 12:04 am

      Each bill should be no longer than 10 standard, type written pages. You really have to do that – you have to nag the government to get it to work. Winston Churchill – a man who had headed up just about every British department of government except the Foreign Office – knew how they worked. “Yes, Prime Minister” and then nothing gets done…so, simply wouldn’t let them off the hook for a moment. He’d tell them – “action this day” and demand a report the next day on what happened; he’d demand the facts of a case “on a single sheet of paper”. That sort of thing. You let the government do it the way it prefers and you’ll get 18 million words of regulations (the Federal register) and thousand page bills which no one reads before being signed in to law.

    • dbschmidt July 10, 2012 / 10:58 pm

      Ama,

      Late reply, but this is one of the goals of President Wilson when he helped Harvard law change the entire legal system of these United States.

  2. Cluster July 8, 2012 / 8:24 am

    Just the other day Bozo was claiming that the Boston Tea Party was actually a rebellion against big corporations, ie; The East India Tea Company, and not the government. So here again, we have liberals who are incapable of seeing the connection between the two. Liberals love to bash big corporate, but somehow in their small minds, big government is just great.

    The other obvious problem is the length of time in government. After 34 years in Washington, do you really think Baucus is representing “the people”? There are many despots who haven’t ruled that long, so this is another huge issue we need to deal with. I have been opposed to term limits before but I think it’s time we implement them.

    • Amazona July 8, 2012 / 8:47 am

      Our Lefties love wikipedia, so I went there to see what they had to say about the Boston Tea Party. They tried to claim it was about the East India Tea Company but even in wiki’s own account it later admitted that the company was having some problems but the issue was taxation, which came from the British Parliament.

      The Boston Tea Party (referred to in its time simply as “the destruction of the tea” or by other informal names and not celebrated until half a century later, was a political protest by the Sons of Liberty in Boston, a town in the British colony of Massachusetts, against the British government and the monopolistic East India Company that controlled all the tea imported into the colonies. On December 16, 1773, after officials in Boston refused to return three shiploads of taxed tea to Britain, a group of colonists boarded the ships and destroyed the tea by throwing it into Boston Harbor. The incident remains an iconic event of American history, and other political protests often refer to it.

      The Tea Party was the culmination of a resistance movement throughout British America against the Tea Act, which had been passed by the British Parliament in 1773. Colonists objected to the Tea Act for a variety of reasons, especially because they believed that it violated their right to be taxed only by their own elected representatives. Protesters had successfully prevented the unloading of taxed tea in three other colonies, but in Boston, embattled Royal Governor Thomas Hutchinson refused to allow the tea to be returned to Britain. He apparently did not expect that the protestors would choose to destroy the tea rather than concede the authority of a legislature in which they were not directly represented.

      The Boston Tea Party was a key event in the growth of the American Revolution. Parliament responded in 1774 with the Coercive Acts, or Intolerable Acts, which, among other provisions, closed Boston’s commerce until the British East India Company had been repaid for the destroyed tea. Colonists in turn responded to the Coercive Acts with additional acts of protest, and by convening the First Continental Congress, which petitioned the British monarch for repeal of the acts and coordinated colonial resistance to them. The crisis escalated, and the American Revolutionary War began near Boston in 1775

      The theme of the protest was “No taxation without representation”.

      The East India Tea Company did not have the power to levy taxes.

      If the protest had been against the tea company the slogan might have been more like “Your tea costs too damned much” but as it was, the slogan referred to taxes.

      • Cluster July 8, 2012 / 9:06 am

        The East India Tea Company was a monopoly and fully endorsed by the British Parliament. In fact the main crime of the rebels was that they were destroying “British Property”. There was zero difference between the British Parliament and the East India Tea Company, much like there is zero difference between the Obama administration and the Green Industry.

      • Amazona July 8, 2012 / 12:51 pm

        Yes, the company was endorsed by Parliament and the relationship was a good example of crony capitalism.

        But the claim by the clown was that the Boston Tea Party was a protest against the company, when in fact it was about the taxes levied on the tea by Parliament.

        Therefore the slogan, “No Taxation Without Representation” and the revolt against the Crown, not just a boycott of the East India Tea Company.

      • casper July 8, 2012 / 6:48 pm

        “There was zero difference between the British Parliament and the East India Tea Company, much like there is zero difference between the Obama administration and the Green Industry.”

        Couldn’t you also say there is zero difference between the Republican party and the Banking Industry, or the Republican party and the Petroleum Industry?

      • Amazona July 8, 2012 / 10:08 pm

        “Couldn’t you also say there is zero difference between the Republican party and the Banking Industry, or the Republican party and the Petroleum Industry?”

        People like you can say anything so why not this kind of nonsense.

      • tiredoflibbs July 9, 2012 / 5:50 am

        Ama, what drones like casper don’t realize when they regurgitate such nonsense is that for the banking and petroleum industries, Democrats and Republicans almost receive equal contributions 45% and 55%.

        However, that changed during the 2008 election cycle where the obAMATEUR and the Democrats received more than the Republicans – and look who received huge bailouts.

        Now before you drones start chanting and regurgitating, “Bush started it”, let me remind you that the program, while started under Bush, was implemented and funds distributed under OBAMATEUR.

        “Green Energy” does not have that close distribution. Plus, under the bailouts for the automakers, the unions (for pensions and benefits) received plenty of bailout cash before stockholders and creditors – something without precedence!

        So, casper, before you spout out nonsense – check the BIG PICTURE and the DETAILS.

      • neocon1 July 9, 2012 / 8:25 am

        catspuke

        weighs in again with his circular BS “argument” for fifth graders.
        stick with teeny boppers catspuke they are sooo your level.

  3. Cluster July 8, 2012 / 10:18 am

    Off Topic: but not only is the “mandate” a tax in our wonderful new health care bill, the following is a list of all the other taxes we will have the pleasure of paying to enrich the ever growing federal bureaucracy of progressives who insist that they know how to run our lives better than we do:

    Note the hike in capital gains taxes, which will really help create jobs – overseas. However, those who long for a strong mother figure in their lives; ie: liberals, don’t have the gray matter to figure that one out. Also the list of these taxes is being conveniently ignored by the Obama regimes reelection team, ie; the media, which reminds of this fact:

    The worst enemy to a large federal bureaucracy is an educated populace.

    • tiredoflibbs July 8, 2012 / 4:51 pm

      I am sure you already have noted the taxes that we have already been paying on this syste and those were taxes imposed on everyone including the middle class – the class on which that obAMATEUR promised not to impose taxes to pay for his program.

      The taxes the drones never acknowledged before.

  4. Cluster July 8, 2012 / 10:24 am

    Oh and just an observational fact:

    Black people ARE the most racist people on the planet.

    Still waiting comment from the white congressional caucus, and the Caucasians for Romney committee.

    http://www.africanamericansforobama.org/

    • neocon1 July 8, 2012 / 11:46 am

      Bonga Bonga

      ‘Expanding Freedom’: perversion 72-Year-Old Barney Frank Marries 42-Year-Old Partner Jim Ready

      “Nancy Pelosi said at the reception that it was appropriate that a landmark same-sex wedding took place around the Fourth of July…”

      can our government sink any lower into the slimy pit of hell?

      • neocon1 July 8, 2012 / 11:56 am

        West for VP

        ‘You Can Call it Communism, Progressivism, Socialism, Marxism, or Statism’: Rep. West Defends His ‘80 Communists in the House’ Claim

        “And you can’t tell me that you’re not seeing that in the United States of America right now.”

    • neocon1 July 8, 2012 / 12:06 pm

      cluster

    • Ricorun July 8, 2012 / 6:09 pm

      Cluster: Oh and just an observational fact:

      Black people ARE the most racist people on the planet.

      Good thing this is just a backwater blog, ‘cuz if it wasn’t, and if anything like the mainstream media caught wind of a blogger like you, who is allowed to post articles on this site also posting comments like this, it really wouldn’t do your cause any favors. And frankly, I don’t believe you really believe what you said, and certainly not as a blanket statement — however you chose to define “black people”. Watch yourself, okay?

      • Cluster July 8, 2012 / 6:17 pm

        Thank you Rico. That was a test to gauge the reaction of some of the liberals here, but I didn’t expect it coming from you. It was a provocative to be sure, but it still pales in comparison to the racist rhetoric coming from the left in the last few months including but not limited to Rep. Andre Carson’s (D) Claim that tea partners want blacks to hang from trees. Funny I don’t recall even a hint of outrage from you or any one else on the left re: any of that rhetoric, but this? This what fires you up?

        And what’s with the “Watch yourself” comment? You disgust me.

      • tiredoflibbs July 8, 2012 / 7:23 pm

        Cluster, your post also pales in comparison to the leftist blogosphere attacking Justice Thomas for his dissenting vote on obAMATEUR-care.

        I can’t post what the tolerant lefties said here for it would be removed.

      • Cluster July 8, 2012 / 7:54 pm

        Tired,

        I couldn’t agree more. The left has gone off the rails with their racial extremism and seemingly with impunity as no one calls them to task. Just the other day Joan Walsh with Salon.com said that “Romney is obviously more comforable with white people” and not a peep from anyone. Yet the questioning of a black attorney general into his knowledge of a federal program under his jurisdiction that resulted in the death of a US Border Guard is seen as “racially motivated”.

        Rico’s response is sad but par for course – unfortunately.

      • GMB July 9, 2012 / 6:04 am

        “Watch yourself” LOL LOL LOL! Watch yourself for expressing an opinion? I’ll remember that little bit of advice when one of you you “new toners” launch into a tirade of hate.

        HEIL RICO!!!

      • Ricorun July 10, 2012 / 8:07 pm

        Cluster: And what’s with the “Watch yourself” comment? You disgust me.

        I’m sorry Cluster, I didn’t realize I disgusted you. In fact, I thought it was quite the contrary. My bad. Anyway, the sort of rhetoric in which you engaged IS inflammatory, and DOES influence votes. And it makes “black people”, however defined — by you or themselves — that much less inclined to vote for your preferred candidates. And that is what I meant by “watch yourself”. I thought I made myself clear on that point. Also as I said, “I don’t believe you really believe what you said, and certainly not as a blanket statement.” I’ve read voluminous statements you’ve made in the past, and I STILL can’t believe it. I also thought you were better than that — i.e., someone who refrained from making blanket (black and white) statements, especially of this character.

        I recall a time not very long ago where you said you wanted people like me (in fact, you mentioned me specifically) would post more often here. Now you say I disgust you.

        Which is it?

        Answer that question, please. Do I really disgust you, or do you think I offer thoughtful, reasonable commentary, however it aligns with your own POV? Said in another way, do you want to continue to just preach to the choir, or do you want something else — even when and if I suggest you “preach to the choir” too vociferously? Answer it in black and white if you like. Answer it in more gray-scale if you like. But of course I would like you to answer it in technicolor. :-).

  5. GMB July 8, 2012 / 12:09 pm

    “Do we want an America which makes, mines and grows most of its own things?”

    Yes, I do want an America that does these thins. Maybe we should ask the republicans in the HoR why they helped pass this bill, don’t you think? Maybe we should ask the opposition party why they didn’t oppose this clause that took away another small slice of our liberty.

    • Mark Noonan July 8, 2012 / 10:03 pm

      As I said, GOPers are part of the problem, too. The only thing the GOP has really going for it right now is that it isn’t Obama and his Democrats…but if the GOP does win this November (and I expect a huge GOP win) then the fat will be in the fire: either restore American liberty or face a wave of TEA Party challengers in 2014 and 2016 (including, especially, in the GOP Presidential primaries). We’ll see what comes of it – but revolution must come if America is to be restored.

  6. js July 8, 2012 / 10:44 pm

    Ive said it many times.

    If you cut election funding, restricting it to the constituency base where a congerss/senate person is elected, this would all end.

    The big corporations are what did this. The greed for ever increasing profit undermined our electoral system with money. Some guy in Provo Utah gets campaign funding frm the US subsidiary of a foreign corporation. The Senator from my district gets funding from the DNC who is getting money from huge insurance corporations incorporated in Hew Hamshire. The Senate Minority leader gets funding from corporations resident across the nation, who have nothing to do with what the local constituents want from thier Senator.

    Cut the funding. If Candidates could only accept money from people/corporations who maintained thier home/headquarters in the district that that Candidate is running in, the corruption would melt away. Its about money, control the cash flow, kill the corruption.

    • casper July 8, 2012 / 10:52 pm

      I agree completely.

      • neocon1 July 9, 2012 / 8:28 am

        catspuke

        you agree?
        you better quit the union and the donk/cpusa then, you would be considered a traitor comrade and we know how they treat them.

    • Mark Noonan July 9, 2012 / 12:10 am

      You’re only tackling half the problem – the other half is NGO’s of various types which also funnel huge sums of money in to politics. But, essentially, you can’t keep money out. Some how or another, it will get in (for instance, a neat, little trick which allows a politician to take a bribe perfectly legally is to hire the spouse as a campaign consultant at 100k per year…even pols who are running unopposed do this. Now the swag isn’t a bribe but a “donation” which is used to pay a salary…of a person who is married to the office holder). Even if you passed a law to say a candidate can only take funding from within his electoral boundaries this still doesn’t end it – you’re an outside interest which wants to influence so you merely cut a deal with a local money man…he takes your money and funnels it to the candidate (and puts it down in his own books as a consulting contract or some such BS).

      Since we can’t keep it out our best bet is to reduce the size of government – the less power government has the less incentive there is to bribe it and the less power a bribe can bring. Of course, the flip side of this is to also break up the large corporations while reducing government. And that is why I’m a Distributist.

      • js03 July 9, 2012 / 6:56 am

        This is the part that would make it interesting Mark. Yes, the corrupt politicians that currently exist would carry on as corrupt as they can, but without the huge $$ they dredge in from 3rd parties that are not resident in their districts. NGO or not, corporations with headquarters in that district could contribute to that Campaign. Now, I’d like to see “big pharma” establish viable entities in every electoral district in the nation. The red flags would pop so hard when they create tens of thousands of corporations and fund the political cronyisms to circumvent the law.
        But face it, no matter what we do; the corrupt will seek ways to circumvent the intent. This however, would force them to spend so much cash that the majority would bail. The local competition for office would become accessible to everyone. The push for honest, moral representatives would actually become an issue again.

      • neocon1 July 9, 2012 / 8:23 am

        js03
        dont forget unions are HUGE corporations them selves….

        Mark
        you are 100% correct on ten sheets of paper, there is NOTHING good in 2500 pages of rules and laws by the government.

        rico
        REFUTE what cluster stated..or is it true?

      • Ricorun July 11, 2012 / 5:02 pm

        @neocon: I refute what Cluster said. Certainly some black people are racist, but not all of them.

      • neocon1 July 12, 2012 / 4:42 pm

        as a PERCENTAGE I have schooled, worked, lived,served with many many more black racists than white, Hispanic, Asian one’s.

        In fact 99% of Hispanics and Asians I know (and I know a bunch) prefer not to associate with blacks…….and feel they are racist and dangerous.

  7. tiredoflibbs July 9, 2012 / 12:41 pm

    Before we get into who gets how much from whom “Edward”, I failed to include the Environmental Lobby in those numbers as part of the “Green Industry” not just Green Energy.

    However, Green Energy received more in DIRECT TAX PAYER CASH from the DEMOCRATS than “big oil” ever received in DIRECT CASH appropriations..

    Now, don’t go regurgitating the “subsidy” talking point. Legal deductions for depreciation of capital equipment is not a DIRECT TAX PAYER subsidy. You cannot compare the tax deductions that big oil legally takes as to the cash payments that Solyndra and the like get from the tax payers under the plan from the obAMATEUR. Where do you think “crony capitalism” came from? – hence the topic of the thread.

    Nice try though – but again you need to look at the big picture and the details.

      • Amazona July 9, 2012 / 7:45 pm

        Cappy, were you able to deconstruct this hit piece or did you just not care that it is so slanted and biased and inherently dishonest?
        (As you used to post here a lot, and I am familiar with your work, I feel comfortable in guessing the latter.)

        And just what does this “big picture” mean to you, cappy?

        What, exactly, do you mean by implying that the petroleum industry has an unusual number of what you call “legal deductions”?

        As a teacher, you must understand that by putting this phrase in quotes you imply that it is not really what it says, so what DO you mean?

        That the deductions for the petroleum industry are not legal?

        That they are not deductions?

        What bothers you about them?

        What ARE they?

        The article claims that the petroleum industry is taxed on its capital investments at a much lower rate than are other businesses, at 9%. What is the rate for capital improvement taxes for other businesses?

        And the article tries to make it sound as if Transocean was trying to pull a fast one by moving its corporate offices out of the country to avoid our high taxes.

        Well, YEAH, of course companies move out of the country when our corporate tax rate is one of the highest in the world. Duh. So why shouldn’t they? Do they have some obligation to spend more than they have to?

        And why should we fret about this when so little of their business is done here anyway?

        “The owner, Transocean, moved its corporate headquarters from Houston to the Cayman Islands in 1999 and then to Switzerland in 2008, maneuvers that also helped it avoid taxes.

        Transocean said it had paid more than $300 million in taxes so far for 2009, and that its move reflected its global scope, with only 15 of its 139 rigs located in the United States. “Transocean is truly a global company,” it said in a statement.”

        The hit piece goes on:

        “Many rigs, like Deepwater Horizon, are registered in Panama or in the Marshall Islands, where they are subject to lower taxes and less stringent safety and staff regulations.”

        Oh yeah? Well, when they drill in the US they are subject to US safety and staff regulations. Do you seriously believe that when a foreign country’s rigs drill here they are only required to follow the regs of their country of origin? Really???????

        As someone who lives in the middle of Wyoming oil country, you should be ashamed to be so ignorant.

        “The American Petroleum Institute, an industry advocacy group, argues that even with subsidies, oil producers paid or incurred $280 billion in American income taxes from 2006 to 2008, and pay a higher percentage of their earnings in taxes than most other American corporations.

        This inconvenient nugget of truth was buried near the end of the hit piece, after paragraphs of misleading “information” geared to appeal to the ignorant Left, sorry for the redundancy.

      • Mark Noonan July 9, 2012 / 7:52 pm

        Seriously? The New York TImes? Might as well bring us an article from the Daily Kos….

      • tiredoflibbs July 9, 2012 / 9:20 pm

        No casper, the point I was making was not who received the most but who benefitted the most from “crony capitalism”.

        BTW, those “legal deductions” as you put it are not exclusive to big oil but any to business who can claim “depreciation on capital equipment” deduction. A deduction as most people know is a reduction in income that is claimed on tax returns. There is no transfer of cash from the government to the business/individual as in the case of GREEN ENERGY, UNIONS and BANKING.

        Again, that TAX DEDUCTION is not DIRECT CASH from the government to a corporation/individual, as in the case of GREEN ENERGY, UNIONS and BANKING (all of which by the way were huge contributors to OBAMATEUR). They really benefitted from those “contributions”.

        Again, casper THE BIG PICTURE AND THE DETAILS bite you on your rear. You should really pay attention rather than be one who is only interested in scoring a “gotcha”.

      • dbschmidt July 10, 2012 / 11:12 pm

        Casper,

        Who is the real thief?

        Federal taxes, State taxes, etc. amount to …
        “which range from a low of 26.4 cents per gallon in Alaska to a high of of 66.1 cents per gallon in California, averaging 48.1 cents per gallon across all states.”

        Compared to $0.06 per gallon in refined petroleum for the big, bad gasoline companies..

  8. Carlo Vicenzo Paparazzi July 9, 2012 / 5:14 pm

    NEWTON, Mass. — U.S. Rep. Barney Frank.has tied the knot with his longtime partner in a ceremony officiated by Massachusetts Gov Patrick.

    Frank, the 72-year-old congressman married 42-year-old Jim Ready in a Saturday evening wedding at the Boston Marriott hotel. 300 friends, family and colleagues attended.
    Frank, a Democrat who is retiring after more than three decades in office, represents the 4th Congressional District in southeastern Massachusetts.
    Ready, of Ogunquit, Maine, has a small business doing custom awnings, carpentry, painting, welding and other general handyman services. He’s also a photographer.
    (OMG, the handyman has pictures!)

    • neocon1 July 12, 2012 / 4:43 pm

      Bwany and the goat are doing fine.

  9. Jeremiah July 9, 2012 / 11:48 pm

    Let’s keep it simple…because our young people really don’t have a grasp of even what capitalism is, much less what crony capitalism entails…Crony capitalism is where people take advantage of the system to get ahead, resulting in only a handful of people who control capitalism’s influence on the economy, such as unions, certain corporations, telemarketers, etc, etc. And these few’s aim is for a socialist end, they have socialist ideas and goals, and therefore, want to destroy capitalism, and the free market system. Much of their income is distributed to liberals causes, and to liberal/socialist oriented candidates running for office, like Barack Obama….and to liberal/socialist causes such as homosexual and lesbian groups.

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