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Go Home Crony Capitalism? Sorry, We've Only Got That In Blue

THE STUMP OCTOBER 10, 2011

Crony Capitalism? Sorry, We've Only Got That In Blue

BY ALEC MACGILLIS

Recently, I asked whether Republican voters would care enough about the crony capitalism evident in Rick Perry's Texas to vote against him. For Tea Party conservatives to do so, I suggested, would mean confronting the disconnect between their populist rhetoric and their willingness, until now, to tolerate Republican coziness with big business. Commenter "Rayward" made another good point to explain why the crony capitalism charge may not take against Perry: "Crony capitalism has no sting anymore because Republicans have neutered the term by calling Obama a crony capitalist. It's quite effective. Reminds of me Pee-Wee's comeback: 'I know you are but what am I.'"

Well, today's Wall Street Journal has an interesting article by Kate Linebaugh suggesting that Rayward had it right. Tea Party supporters, she reports, have launched an assault on General Electric over CEO Jeff Immelt's willingness to head President Obama's "Council on Jobs and Competitiveness." Leave aside that the council, by all appearances, is not doing much of anything. To the Tea Party, the willingness of Immelt (a Republican from a Fox News-addicted family) to work with the administration is proof positive of...crony capitalism! Linebaugh quotes Wayne T. Brough, chief economist at Freedomworks, the national tea-party group backed by Dick Armey, which has protested at GE shareholder meetings: "We've had concerns that Immelt uses the government rather than the marketplace to drive GE's philosophy on how to do business. It feeds into a crony capitalist kind of mentality that isn't actually the best way to generate economic growth."

Linebaugh reports that Tea Party supporters are also upset that G.E. has managed to pay so little in corporate taxes in recent years, and that so much of its job growth has occurred overseas. Somehow, though, I suspect that is not the main driver of Tea Party discontent -- there are no shortage of offshoring corporations with paltry tax bills who are not getting FreedomWorks pickets at shareholder meetings. And I also don't expect to see FreedomWorks showing up outside any of the company locations in Armey's home state of Texas that have received millions from Perry's taxpayer-funded Enterprise Fund -- Caterpillar, Washington Mutual (now JP Morgan Chase), Citgo, Lockheed Martin, Tyson Foods, Home Depot, Medtronic, T-Mobile, Comerica, Hewlett-Packard, Raytheon, Fidelity...

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11 comments

So if it's Red, it's not Crony Capitalism (by definition apparently). Such blindness and hypocrisy is no way to run a nation.

- AllanL5

October 10, 2011 at 10:57am

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We need to dump the "crony capitalism" label and call it what it is: Corruption.

- ReganaD

October 10, 2011 at 11:07am

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Washington Mutual is now JP Morgan Chase not Wachovia. Wachovia has been subsumed by Wells Fargo.

- David Jackson

October 10, 2011 at 11:51am

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Thanks, David. Made the fix. Hard to keep them all straight...

- Alec MacGillis

October 10, 2011 at 12:56pm

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I think you need a better example of Republican hypocrisy on the "crony capitalism" issue that GE -- remeber, they are the company that owns MSNBC. And most conservatives and Republicans know it, thanks in no small part to Fox News hosts like Bill O'Reilly constantly bringing it up. So Republican hostility to GE could simply be chalked up to their hatred of MSNBC liberalism rather than their comfort with crony capitalism practiced by Republicans. It would be better to company businesses whose coziness with the government drew no Republican censure under, say, GW Bush or a Repubilcan governor but whose coziness with the current White House registers outrage among conservatives.

- wildboy

October 10, 2011 at 1:26pm

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Oops -- last sentence should read, "It would be better to compare businesses whose coziness with the government drew no Republican censure ..."

- wildboy

October 10, 2011 at 1:27pm

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Congrats to Rayward for being quoted !! Nice job buddy

- Tristan

October 10, 2011 at 1:58pm

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Halliburton is still giggling all the way to the bank. That anyone can throw charges of crony capitalism towards this administration is incredibly, sickeningly, mind-bogglingly hypocritical. Or just another day. You know, whichever.

- Tristan

October 10, 2011 at 2:01pm

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The only problem I have with crony capitalism is I am not one. and kudos to ray as well.

- blackton

October 10, 2011 at 5:34pm

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I think that the discussion of crony capitalism needs somewhat better focus to be meaningful. There have always been businessmen in the federal and statel governments in some capacity or other, and there has always been some variety of government protection or subsidy for businesses. The issue, as ReganaD correctly indicates, is whether the participation and support involves corruption. For example -- to what extent has the Obama administration's reluctance to bring criminal charges against bankers involved in the financial crisis been guided in substantial part by the support those bankers have given to the Obama campaigns; and on the other side, to what extent have the subsidies given in Texas by the Perry administration been given to political supporters without proper regard for the merits? The influence of lobbyists and their money is a well known national scandal. My suspicion is that the corruption is wide and deep in both parties, although as a lifelong liberal Democrat my sincere belief is that the corruption on the GOP side is much worse. What we need are some serious kick ass domestic reformers running for high office. Can anyone name even one?

- PeteBeck

October 11, 2011 at 10:59am

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Ray, Pete, and Pee Wee, got it right. There is no readily apparent difference between the sort of crony capitalism displayed by both parties (more-or-less equally if we include, as we should, farm subsidies, defense contracting, etc), and corruption. The Silver Bullet is a totally deduction-free tax code and an end to subsidies of all kinds. Let someone really try to do that, and all the crony capitalists will become immediately identifiable on both sides of the aisle.

- Robert Powell

October 11, 2011 at 11:25am

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