Do you Know Crony Capitalism from Real Capitalism?

Crony_CapitalismCapitalism is defined as an economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by the state.

Unfortunately, in our modern age where government has vastly exceeded its constitutional and legitimate boundaries, and corruption runs amok in both parties, a lot of capitalism has been replaced by “crony capitalism.”

Crony capitalism looks a lot like real capitalism, but with a few critical differences.

In real capitalism, people seek the best value for the money.  In crony capitalism, government often gets involved in the purchasing and buys not what is necessarily the best product for the least money, but the product marketed by those who fill their campaign coffers with political donations.  And who cares if it wastes the taxpayer’s dollars.

Also, in real capitalism, government stays out of the free market and allows competition to determine which companies do better than others. Companies that market a better value for consumers will usually succeed because people recognize the value, and patronize that business.  But with crony capitalism, government interjects itself into the free market, providing benefits, breaks and favors for those businesses that contribute to the political campaigns of those in power, while making it harder for disfavored businesses to succeed.  They do this through favored government contracts, tax breaks, as well as regulations imposed on the disfavored businesses.

Government should not be in the business of picking winners and losers in what should be the free market.

We must scale back the reach and scope of government.  Doing so will curb waste of taxpayer funds, reduce corruption in government, and help the free market function as it should.

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Bob Ellis has been the owner of media company Dakota Voice, LLC since 2005. He is a 10-year U.S. Air Force veteran, a political reporter and commentator for the past decade, and has been involved in numerous election and public policy campaigns for over 20 years. He was a founding member and board member of the Tea Party groups Citizens for Liberty and the South Dakota Tea Party Alliance. He lives in Rapid City, South Dakota with his wife and two children.
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