USA 2024 Elections Thread

grarpamp grarpamp at
Thu Sep 15 22:01:46 PDT 2022

Woke failures are clueless about Free-Markets, Capitalism, etc.
That is why their Socialism fails, repeatedly, always.

We Need A Common Understanding Of What 'Capitalism' Means,en_crony-sectors-as-a-barrier-to-economic-well-being-and-ecologization-(case-of-ukraine)

Almost every day, there is a news story or opinion piece blaming a
societal problem on capitalism. A recent one blames capitalism for
destroying art, citing Warner Brothers cancelling the release of
Batgirl. While sometimes it seems that people are just looking for
some kind of scapegoat, there continues to be deep skepticism about
capitalism, especially among young Americans. When skeptics and
advocates talk about capitalism, are we really speaking the same
language when we use the word? Though some critics have a deep
understanding of different economic systems, new evidence shows how
many are confusing free markets with cronyism. This confusion hinders
coherent policy discussions, as well as the future of economic freedom
and flourishing.

In what has been referred to as “the hockey stick of human
prosperity,” there have been huge advances in human prosperity in the
last 200 to 300 years after centuries where the world was extremely
poor. To better understand why young adults are so skeptical of
capitalism — despite the important role that free markets have played
in enabling this prosperity — we conducted a survey of 2,000 students
at 130 four-year universities and colleges across the U.S., examining
how their conceptions of capitalism relate to their attitudes about

We found much disagreement among students about what is meant by
capitalism. When presented with a free market definition (“property is
privately owned, exchange is voluntary, and production and pricing of
goods/services are determined by market forces”), a cronyism
definition (“corporations utilize grants, special tax breaks,
political connections, and special rules that favor them…”), and the
option of “I’m not sure,” 49% chose the free market definition, while
the remaining 51% chose cronyism (36%) or indicated being unsure

This conceptual confusion seems to influence how young people view
capitalism. Overall, only 23% of students have a positive view of it,
compared to 38% with a negative view. However, among those who define
capitalism as cronyism, only 6% have a positive view and 70% have a
negative view. For those who define capitalism as free markets, 40%
have a positive view and 19% a negative view.

Moreover, the pessimistic views toward capitalism may be fostered by
professors’ views. Of students reporting that professors have
expressed views on capitalism, 62% say such views have been negative.

As pointed out in a recent study by Peter G. Klein and several
colleagues, confusing capitalism with cronyism may result in decisions
and policies that are harmful to society. They point to other studies
which link a number of societal problems often attributed to
capitalism — poor child health, weak environmental protection, higher
income inequality, poor infrastructure quality — to cronyism instead.

They also point to an unvirtuous spiral that occurs as a result of
such confusion. Policy responses that wrongly target market capitalism
result in more government intervention in the economy, which creates
even more opportunities and incentives for firms to engage in
cronyism. This leads to additional harm and distrust in capitalism.

Two recent examples illustrate this unvirtuous spiral. Recent supply
chain disruptions are at least partially rooted in cronyism, with
dockworkers unions fighting port automation for decades and lobbying
various governments to prevent it, and with the Jones Act preventing
non-U.S. owned, built, and crewed ships from transporting goods
between U.S. waterway ports.  This has led to calls for “reshoring”
with trade tariffs and corporate giveaways to bring supply chains
“back home.” Not only do such policies harm consumers and taxpayers,
they incentivize firms to engage in lobbying to make sure the “wrong”
products are charged tariffs and the “right” ones receive subsidies —
a recipe for more of the type of government favoritism that sours the
reputation of capitalism. One needs to look no further than the
tariffs imposed on steel, aluminum, and Chinese products by the Trump
administration to see how they can encourage lobbying and harm small

As another example, the important role played by cronyism in hindering
the technological progress and institutions needed to combat climate
change in developing countries has been ignored by those blaming
capitalism for the problem. Policies for combatting climate change
have amounted to favoring one technology over others through
subsidies, banning other tech, and micromanaging which solution is
best through regulations such as building codes. Again, this type of
intervention necessarily favors some businesses over other,
potentially more environmentally friendly ones, and invites the
political lobbying that characterizes cronyism. A great example of
this type of cronyism and its implications is the failed Solyndra, a
company that went bankrupt shortly after being given $535 million in
loans in the Obama administration, where political lobbying played a
huge role. Such lobbying incentives are eventually blamed on
“capitalism” and further intervention will be sought.

There are many more such examples. To the extent that we fail to
distinguish capitalism from cronyism and treat the wrong disease,
we’ll get more cronyism and distrust of honest capitalism will only
grow. And however one feels about market capitalism, if America is to
continue as the world’s largest economy and a hub of experimentation,
innovation, and opportunity, plenty of it will be necessary. This
requires, at the very least, a common understanding.

We believe this effort needs to start in universities, the
institutions responsible for forming many of our future leaders. The
results of our survey suggest there is much work to be done.

John Bitzan is Menard Family Director of the Sheila and Robert Challey
Institute for Global Innovation and Growth, North Dakota State

Clay Routledge is Vice President of Research and Director of the Human
Flourishing Lab at the Archbridge Institute.

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