Cronyism and Corporatism

An end to Ukraine’s suffering requires a realistic deal with Putin, something that Trump at least partly understands.

President Trump has announced his intentions for the government to set up a sovereign wealth fund. However popular the idea might be, it runs headlong into the realities of economic calculation and would soon deteriorate another government slush fund.

How can we determine if a private company is a true partner of the state—truly benefiting from state power—or if the private company is really a victim of the state?

The US government has long pushed to establish government-sponsored cartels and monopolies that weakened free-market competition and enriched incumbent businesses, unions, and other interest groups.

The American Revolution struck a heavy blow to mercantilism. Unfortunately, many mercantilist policies persisted under new labels: cartelization, monopoly, regulation, and taxation to support corporate friends. Today we call these neomercantilist practices cronyism and corporatism. 

In a post-Cold War world, there is an opportunity to find useful insights among even the New Right that Rothbard loathed. James Burnham‘s The Managerial Revolution produced important points about the relationship of government and business.

Despite the government‘s efforts to prop up real estate prices, the markets are having the last word. Commercial real estate is especially vulnerable to the latest trends.

America’s residential mortgage market is mostly controlled by government. Ryan McMaken and Alex Pollock talk about how government corporations like Fannie Mae are fueling America’s housing affordability crisis. 

Every law or regulation carries an economic cost that cannot be ignored or precisely predicted, altering economic incentives and stifling innovation and entrepreneurship.

Making it harder to do business with Americans is not the way to help domestic workers, small businesses, and everyone else in middle America who has been getting ripped off under our current political system.