Crony Capitalism has a Home on Pennsylvania Avenue

Capitalists don’t actually like capitalism is a premise by Milton Friedman. The financial meltdown of 2008 showed the ugly side of capitalism. But it was crony capitalism that got us into this mess, and its crony capitalism that has failed to get us out.

Nicholas D. Kristoff of the New York Times reminds us that we used to lecture Asia about the pitfalls of crony capitalism. The folks who reside on Pennsylvania Avenue could use a little history lesson. But the President and his servants in Congress probably already know this, since it was former Obama Economic Advisor, Larry Summers, that warned Asia about their erroneous ways.

The response to the financial meltdown by Henry Paulson and Tim Geithner featured major cronyism (Goldman Sachs vs. Lehman Brothers, GM bondholders vs. unions). The Obama administration’s favored green investments are full of Democratic bundlers, lobbyists, and relatives.

The housing market bubble was created by the government pushing for affordable home loans to people who could not afford them. What followed were massive losses at Fannie and Freddie, AIG, and many Wall Street investment firms. The Troubled Assets Relief Program was initially used to prop-up troubled banks. Then it was later expanded to provide relief to AIG and the auto companies. The banks have since paid most of that money back to the treasury. Non-bank companies such as GM, Chrysler and AIG will probably never produce a positive return on our investment.

We should grab Hillary Clinton’s Reset button and apply it to our capitalist markets. Get the government out of the investment game, and let free markets rule.

Capitalism is an art form, an Apollonian fabrication to rival nature. It is hypocritical for feminists and intellectuals to enjoy the pleasures and conveniences of capitalism while sneering at it. Everyone born into capitalism has incurred a debt to it. Give Caesar his due. Camille Anna Paglia

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