Sunday, November 27, 2011

Quote of the Day: Pro-Market vs. Pro-Business

"There is a world of difference between being pro-market and being pro-business. Sometimes, the two positions happen to coincide; often they don’t."


MP: Stated differently, many of the criticisms of capitalism are really criticisms of "crony capitalism."  

15 Comments:

At 11/27/2011 9:47 PM, Blogger HaynesBE said...

Why sully the term capitalism? Why not just call it 'cronyism"?

 
At 11/28/2011 12:53 AM, Blogger truth or consequences said...

Ok, I'll buy that. Completely agree.

Now, what's the diffrence between Capitalism and "Crony-Capitalism"??????

Answer: REGULATION...and if that makes some brisstle....then call it something else...like oversight, maybe.

No matter what you call it...there is a need for something. Why is the concept of "checks and balances" so desirable in government...but "tyranny at gunpoint" when applied to commerce/industry in general???

The world ain't black and white.

 
At 11/28/2011 2:22 AM, Blogger anshuman said...

An informative blog on pro-market and pro-business.

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At 11/28/2011 2:29 AM, Blogger PeakTrader said...

truth or consequences says: "Answer: REGULATION"

There's bad regulation and good regulation.

And, I suspect, overregulation is as bad as its overspending.

 
At 11/28/2011 3:59 AM, Blogger juandos said...

"And, I suspect, overregulation is as bad as its overspending"...

Yes but have leftie-nanny staters ever considered the downsides of excessive regulation anymore then they care about spending someone eles's money on their dumb and unworkable ideas?

 
At 11/28/2011 6:52 AM, Blogger geoih said...

Quote from truth or consequences: "Why is the concept of "checks and balances" so desirable in government...but "tyranny at gunpoint" when applied to commerce/industry in general???"

Because in the first scenario (government), both sides have guns, but in the second scenario (tyranny) only one side has guns. In either case, it's still just a bunch of thugs using coercion and violence to impose their demands on others.

Seems pretty close to black and white. On which side are you?

 
At 11/28/2011 9:53 AM, Blogger VangelV said...

You got it. The difference is regulation that prevents free market competition.

No matter what you call it...there is a need for something.

Yes there is. Protecting individual liberty and property from force and fraud. That is the only legitimate role of the state.

Why is the concept of "checks and balances" so desirable in government...but "tyranny at gunpoint" when applied to commerce/industry in general???

I think that you are confused. When industry gets to write the regulations there is no check and certainly no balance in play. All you have are barriers to competition that harm smaller companies that cannot spend the money on compliance and consumers who have to pay more.

The world ain't black and white.

No. But principles are.

 
At 11/28/2011 10:18 AM, Blogger morganovich said...

t or c-

while a great deal of crony capitalism takes place in the form of regulations, it goes well beyond that.

there is subsidy, loans, grants, tax treatment, federal interference in markets (like freddy and fannie), and all manner of other malfeasnace.

the overall problem is big government.

one you give the government the ability (and mandate) to affect economic outcomes, private actors will start buying and selling politicians just like they hire sales, marketing, and biz dev people.

it's a rational profit maximizing choice that, like a typical prisoner's dilemma scenario, results in an inferior outcome.

it's much too tempting to be the first defector, especially if you don't trust the other guy/guys (and note that a 3+ player prisoner's dilemma is far more likely to reach the low equilibrium than a 2 player one)

the only way to take this sort of influence out of government is to take influence away from government.

far from needing a strong government to rein it in, capitalism is incompatible with such a government. it inevitably turns to cronyism.

 
At 11/28/2011 11:58 AM, Blogger efimpp said...

>"Stated differently, many of the criticisms of capitalism are really criticisms of "crony capitalism."

reminds me of something I heard from many people long ago...
Communism as idea is not bad, just the way we tried to build it was wrong, let's try again.

 
At 11/28/2011 3:24 PM, Blogger Jet Beagle said...

"Why sully the term capitalism? Why not just call it 'cronyism"?"

HaynesBE, I completely agree. Favors granted to special interests, not capitalism, is the problem.

Let's be clear about who the bad guys really are. We should expect corporate executives, union leaders, AARP spokespersons, NRA lobbyists, environmental action committees, and all other special interests to act on behalf of those who pay their salaries. It would be completely naive and idealistic to think special interest employees would act in the best interest of the entire nation.

The bad guys are the members of Congress, paid by taxpayers to act on behalf of the citizenry, who instead use their power to favor those special interests.

 
At 11/28/2011 3:44 PM, Blogger Junkyard_hawg1985 said...

"while a great deal of crony capitalism takes place in the form of regulations, it goes well beyond that.

there is subsidy, loans, grants, tax treatment, federal interference in markets (like freddy and fannie), and all manner of other malfeasnace.

the overall problem is big government."

Well said morganovich!

 
At 11/28/2011 5:19 PM, Blogger VangelV said...

the overall problem is big government.

True. Which is why both the left and right are responsible for the crony capitalism that we see dominate the economy.

 
At 11/28/2011 5:20 PM, Blogger VangelV said...

reminds me of something I heard from many people long ago...
Communism as idea is not bad, just the way we tried to build it was wrong, let's try again.


Communism was always a bad idea. So is crony capitalism. The good idea is free market capitalism, which is different from both.

 
At 11/29/2011 9:47 AM, Blogger efimpp said...

>Communism was always a bad idea.
Oh, and so many smart people thought differently before it was really tried.
>So is crony capitalism.
that seems more obvious if you call it like this. To compare you should use GULAG instead of "communism".
> The good idea is free market capitalism
sure, like, say, 1850 in England?

my point is, show me how it can work in real world, the we'll see.

 
At 12/08/2011 9:35 AM, Blogger VangelV said...

my point is, show me how it can work in real world, the we'll see.

Look at Hong Kong. It is the closest thing that you will get to a free market system and a legal system based on common law. Interestingly enough Hong Kong's biggest problem is in the area where its governors have traditionally meddled the most.

 

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