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Occupy and the Tea Party both oppose crony capitalism

Credit: tymortensen.tumblr.com

Credit: tymortensen.tumblr.com

The far left and far right are in agreement. Crony capitalism is wrecking  the country, strangling small business, and shredding civil liberties. The few get wealthier at the expense of the rest of us, aided by a captured government.

Pragmatic centrism is crony capitalism, say Macroeconomic Resilience. This sounds quite a lot like what Obama does constantly. “Work with the other side to find a solution.”  Yet such solutions somehow always manage to screw most everyone but the wealthy, don’t that? Well of course they do. That’s the goal of crony capitalism.

Neoliberal crony capitalism is driven by a grand coalition between the pragmatic centre-left and the pragmatic centre-right. Crony capitalist policies are always justified as the pragmatic solution. The range of policy options is narrowed down to a pragmatic compromise that maximises the rent that can be extracted by special interests. Instead of the government providing essential services such as healthcare and law and order, we get oligopolistic private healthcare and privatised prisons. Instead of a vibrant and competitive private sector with free entry and exit of firms we get heavily regulated and licensed industries, too-big-to-fail banks and corporate bailouts.

They propose radical centrism as a cure.

The core strategy of pragmatic crony capitalism: increase the scope and reduce the scale of government

radical centrism: increase the scale and reduce the scope of government

The essence of a radical centrist approach is government provision of essential goods and services and a minimal-intervention, free enterprise environment for everything else.

While some have problems with core principles of capitalism, I would argue we don’t have capitalism in the US. It has been replaced by crony capitalism, which isn’t really capitalism at all.  Gandhi, when asked about democracy in the US said “I think it would be a good idea.” The same is true about capitalism in the US. Minimal intervention by the government would certainly be an improvement over what we have now, which is blatant favoritism by the government reinforced by equally blatantly refusing to enforce the law against the post powerful. However even Adam Smith, the father of capitalism, said markets should be firmly regulated. So, governments need to do that too. And then not intervene.

I live in Silicon Valley. Capitalism here for start-ups is what capitalism was meant to be. Try out your idea and business. If you make it, great. If not, then you pay off your maxed out credit cards and try again if you can. This is what Macroeconomic Resilience calls the invisible foot of capitalism, and it no longer exists for the 1% and the plugged-in and powerful. Instead they have the not-so-invisible hand giving them bailouts, subsidies, tax breaks, and more.

Restore the ‘Invisible Foot’ of competition

The neo-liberal era saw a rise in incentive-based contracts across the private and public sector but without the invisible foot of the threat of failure. The predictable result was not only a stagnant economy but an increase in rent extraction as private actors gamed the positive incentives on offer.

The far right and far left both oppose the plutocracy, notes The Scholars Stage..

There are two groups who consistently oppose this plutocratic “pragmatic” consensus: the far left and the far right. These two groups, seemingly divided, are united by their “radical” opposition to many otherwise unquestioned aspects of America’s standing political regime. To name but a few:

  • The belief that the United States federal government should play a strong role in holding up the U.S. economy – particularly sectors deemed “Too Big To Fail.”
  • Strong support for subsidies or other forms of ‘corporate welfare’ for influential or strategic industries (“The Farm Lobby,” “Big Pharma,” and the energy sector – both the “Big Oil” and green energy varieties – are prominent examples).
  • A commitment to America’s global hegemony and globalization writ large. The chosen instruments for this are transnational economic agreements, financial interventions (as pioneered by the IMF), or offers of substantial military assistance.
  • The use of drone strikes, special forces and other ‘limited war’ operations as the most effective response to international terrorist movements.
  • A disdain for the rule of law and governmental transparency.
  • Prioritizing national security over privacy and individual rights.
  • Eclipse of the legislative branch in favor of an increasingly large, complex, and powerful executive.
  • Outsourcing legislative policy making to congressional, think tanks, or industry wonks.

 

I’m what would probably be described as a left-wing populist, lived in Utah recently, and was surprised at how many supposed right wing Utahns were just as angry at the same things that I was.

The original Tea Party, the one started by Karl Denninger , was founded solely in outrage at the bailouts. When I first learned of this, I went to his site because I was sure he had to be racist. He’s not. We all have so many preconceptions about The Other Side.

The process by which the Democratic Party co-opts and defuses genuine protest by bringing it into the party where it is defused is brilliantly explained by Peter Camejo in his 2004 Avocado Declaration written during his Green Party VP run with Nader. The same process happened to much of the Tea Party with the Republicans. Our two political parties really are Tweedledee and Tweedledum, servants and supporters of crony capitalism.

( Via Zen Pundit )

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