Thursday, August 04, 2011

Anyone You Know?

Andrew Redleaf explains the difference between socialism and crony capitalism:
The socialists are an intellectual party comfortable with abstraction and with theory. Moreover, precisely because they have visionary and ambitious goals, at least since Lenin and his New Economic Policy the socialists have recognized they can get where they want to go only by riding on the back of capitalism.  
Crony capitalists have neither the inclination for theory nor the interest in general economic success that attaches to the socialists. ...

No one is more sophisticated than the crony capitalist, to whom everything is gray and no man is a greater fool than the man of principle. The crony capitalists pride themselves on their grim realism, on being unburdened by ideas, on their infinite flexibility and pragmatism. All of which comes down to you can't trust them as far as you can throw them.

Unlike the socialists, the crony capitalists do not depend upon the general success of the economy to achieve their larger goals. For one thing, they can hardly be said to have larger goals. The crony capitalist is instinctively satisfied with the notion of a zero-sum game, which, for his purposes, is better than a rising tide that lifts all boats. What good is it to the crony capitalist to see all boats lifted? Will all boats remember the favor?

Crony capitalism is widely identified with the personal corruption that everywhere ultimately attends it. This is a mistake. The crony-capitalist politician is often not corrupt in the ordinary sense. What did Hank Paulson gain personally from bullying financial markets to the brink of a general economic collapse?

At its heart crony capitalism consists in a deep skepticism about the efficacy of ideas, the practicality of principle. Or at least it is a deep skepticism in the breast of the rare crony capitalist contemplative enough to achieve such a highly intellectual state. For most of them, it is not so much that they are skeptical of the power of ideas but that the notion of such power has never occurred to them. . ...

Crony capitalists are always statists, not in theory, like the socialists, but in practice, because they cannot let go of the impulse to control events. Controlling events means staying within the narrow boundaries of their experience and imagination, not to mention their Rolodexes. Iraq needs to be rebuilt? Call in the certified, pedigreed, well-connected, quasi-official rebuilders. The Democrats would do the same thing in their place (with bigger minority set-asides) and tell themselves they were doing it for the people.   

--Andrew Redleaf (2010). Panic (Kindle Locations 2840-2884).  

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