Sometimes 2 trends will look eerily similar for a good long while and then the 2 trends will diverge. We’ll see in this case.
However there is a very good case to be made for a Chinese stock bubble, hell, a Chinese country bubble in many respects. China is the ultimate crony capitalist state.
That China is rattling its saber with such vigor lately may be a symptom of a Communist Party which is seeking to focus attention away from domestic economic issues.
We are not creating new businesses in the USA at the rate we used to. A mixture of factors has contributed to this (as is pointed out in the attached article) but crony capitalism and overegulation (the two are tied) are the chief culprits in my estimation.
It’s always been hard to start a business. It’s always been hard to take an idea, make it grow, and then make it grow profitably. But in an increasingly crony and regulated economy it’s even harder. It’s one thing to have a short stack at a poker table. It’s something different to have the short stack while the big stack established firms get to change the rules of the game and take some of your stack with each hand.
David Sirota explores the space where the Clinton Foundation, Hillary Clinton’s State Department, and weapons procurers and manufacturers met – or didn’t.
It was not that long ago that Detroit was one of America’s and the world’s great cities. A center of industry and commerce which rose up out of the American Midwest as testament to innovation and ingenuity.
So a generally libertarianish guy who believes in free markets, lowering taxes, and actually reducing the size of the government is a “liberal Democrat”? Well, gee, this country is better off than we may have thought. Our colleges must be filled with professors calling for deregulation and the protection of property rights because we know that our university system is “liberal.” Ted Kennedy was actually for liberty and freedom not an ever expanding state, you didn’t know that?
And the guys who want to spend tons and tons of money America doesn’t have nation building and generally expanding the size of government are actually CONSERVATIVES! Holy moly, this changes everything. Good thing we have “conservatives” like Bill Kristol, whose political lineage extends back to a bunch of Trotskyites in the 1930s (the neoconservatives) to explain to us what a “liberal Democrat” is.
An excellent article from Jack Curtis at The American Thinker.
America has stagnated. It isn’t dynamic. Government is thick and restrictive. Businesses are not being created at the rate they were in the past. 20% of households (according to the attached article) have no one working. 1 in 5 households have no workers.
A poison cocktail of fiat financialization and massive government has dripped into the American bloodstream over the last 4 decades or so. The vigor is gone. Increasingly desperate people look to the welfare state for solutions, or at least a fix.
It is the state which has created this situation, not capitalism. We haven’t had real, non-crony capitalism, in this country for a long time. And the culture of Obama has accelerated this move away from free markets and free prices.
They say that parasites rarely kill their hosts. But sometimes they do.
As a Democrat she’ll be particularly well positioned. The former senator will be able to occupy the enviro/oil industry sweet spot quite comfortably. Lots of money (one way or another) on both sides of that political equation.
This happens over and over and over. Mr. Lawsky is just one in a long line of financial regulators who have switched sides. (Well “switched” might be too strong a word.)
Anyone want to start a pool as to how long it will be before Eric Holder cashes in?
A broad, sweeping, global treaty which will/may fundamentally shift how trade is done in the world and in the USA is still secret and thanks to Senate Republicans is halfway to getting “fast track” status. That is the treaty will be voted on for final approval by Congress with a simple “yes” or “no” vote, without debate or amendments. That doesn’t seem right to me.
Now I am all for free trade. I think goods and services should flow without friction across borders. I say make it easier for this to happen. This creates opportunity and better goods at better prices for nearly everyone.
When I was a kid I used to get Sears brand sneakers with my mom. (Fashion was not a priority for my parents when it came to the kids.) Every 6 months or so I’d get a new pair. The cost was $35-$40.
Fast forward to now. At Target kid sneakers of much higher quality than my Sears kicks can be purchased at about the same price or even lower. And this isn’t even in inflation adjusted terms. Adjusting for inflation, these higher quality sneakers are probably HALF the price of my old sneakers, or even less.
This is an example of free trade raising the quality of life generally.
The same can be said for t-shirts, technology, any number of things. Our lives are for the most part much better because of relatively free trade.
Of course there are losers in this equation. The people who used to make my Sears brand sneakers no longer have a job making Sears brand sneakers. That’s true. But generally life is better in America for all those Chinese made goods which are made for us at lower cost and with higher quality (often) than products made in the States.
But it concerns me that the Trans Pacific Partnership, a supposedly “free trade” agreement, is being handled with such secrecy. This giant agreement has been negotiated and is being voted on (at least fast track authority) by the Congress, without any public review at all. Is this how we do business in the USA now? Are our leaders so afraid that the people will rise up in opposition that government must now be done in the shadows?
Cartels rarely survive very long without the backing of the government. The big trusts over the years have only continued on over the long term if they had the protection of the state. In a free market with free prices monopolists are constantly undermined by new firms, with newer equipment and better methods. There is no better trust buster than the market.
If however the companies in power at a particular time can buy into the government and create a regulatory moat around their firms the old, less innovative guard can remain in place. A key part of crony capitalism.
Below the master Murray Rothbard discusses this phenomenon in a short excerpt.
There are more groups like Crossroads out there these days. More dogs. But more important than that is that Rove and American Crossroads are associated with George Bush and an era of big government “conservatism”. George Bush and Karl Rove blew up the modern (Reaganish) conservative movement. Many have not forgotten this. That Rove has explicitly targeted the libertarian/conservative coalition hasn’t earned him any friends either in a rapidly changing party.
Of course many people besides Congressman Hensarling are behind the effort to kill the Export-Import Bank of the United States, often called “Boeing’s Bank.” But he is leading the charge on the Hill.
China is the ultimate crony state and it may just export some (more) Sino-cronyism to our shores—well, California—soon. Cali wants a bullet train and China has the know how and the financing to build one.
If it’s the best product at the best price, hey have at it. Thing is, bullet train+California+China just has gigantic boondoggle written all over it. It will be a crony feast.
OK, Boeing has every right to go wherever it chooses as far as I’m concerned but this sort of posturing should be kept in mind when it comes time to award defense contracts. Basically the company is holding a gun on some members of congress and demanding money from the taxpayers—or else. This kind of behavior should not be rewarded.