Look For The “Crony Capitalism” Label

Here's the latest big business crony...I guess.

Here’s the latest big business crony…I guess.

During the presidential campaign, the Romney camp trotted out the phrase “crony capitalism” when they realized that a president famed for taking over and saving the auto industry before returning it to its private shareholders could no longer be credibly called an anti-business socialist.

The new term, like so many churned out by the brilliant GOP spin machine, solved the problem brilliantly: Obama was still anti-business because the businesses his administration has aided don’t count. There is something untoward about Obama’s relationship with any business that got a bailout. Something off about any business who used last few years to grow.

It’s self-reinforcing too. Business leaders give tons of money to political campaigns for candidates whose policies have helped their business. If a business has grown over the last four years and its executives lavish Obama’s coffers it proves that there was some sort of scheme afoot. For some reason the millions given to Republicans by gun manufacturers or the owners of off-shore casinos falls above the line of reproach.

But this effort by Matt K. Lewis to revive the tired “crony capitalism” canard by bootstrapping it to the gun debate is laughable. His argument begins by blasting Obamacare for helping the big insurance companies and pharmaceutical manufacturers through the individual mandate. It’s true that the decision to junk the single-payer model helped big business. It’s also true that this was a Republican plan created for the sole purpose of being the “pro-business” alternative to health care reform, so I’m not sure it’s attractiveness to business is something conservatives should be knocking. “Don’t throw stones when you actually built the glass house” and all.

But who gains from gun control? There are no obvious winners like insurers and drug companies won health care. Lewis asserts Walmart as the nation’s largest gun retailer. Go on…

But what would Walmart get out of the deal? First, not cutting a deal could have negative consequences.

Yes, that’s right. Walmart is an Obama crony because it doesn’t want to be crippled by the coming regulations. Instead of crafting policies to help his friends, Obama is crafting a policy to hurt Walmart and Walmart is hoping to mitigate the damage. This is hardly the cronyism that the conservative label needs to justify itself.

Lewis does offer the thin broth of closing the gun show loophole. Basically asserting that the cronyism at play is the fact that Walmart would benefit if unregulated private sales were curtailed. But with Walmart already the largest gun retailer in the country, why does it care about private gun shows? Would eliminating that market really justify the mounds of additional red tape Walmart would endure to meet new background check regulations? Walmart’s reticence to join serious gun control efforts before now — and indeed it’s initial refusal to join this effort — give lie to the idea that Walmart sees any competitive advantage in this new policy.

Finally Lewis bemoans the dangers of big business, which is genuinely anti-capitalist in his mind. I’m not disputing that big corporations are often at odds with the free enterprise system, but Walmart is hardly the poster child to put up for this argument. Walmart is the pride and joy of “Red State” America, a company that used economies of scale — rather than government procurement contracts — to obliterate local competitors. Walmart may well be a drag on true free market competition, but you’d have a hard time selling conservatives on that…and that’s exactly what this article needs to accomplish in order to make a lick of sense. Lewis goes on to complain that:

"We've almost invented the self-driving Rascal"

“We’ve almost invented the self-driving Rascal

What is more, the danger is that at some point it makes better business sense to focus more on what economists call rent seeking (lobbying, etc.) as opposed to focusing on research and development and innovation — things that actually add value to our economy.

Can we cut to the image of the boys back at the Walmart R&D lab spending their days making new discoveries in how to clean up aisle 6? What development and innovation is the retail industry blowing off to lobby the government?

I guess Lewis saw the crony capitalism tag work so very, very well during the election that he felt compelled to insert its rhetorical power into the looming gun debate. But the power of the charge is lost when the “crony” is not a bankrupt solar-power firm or reviled pharma company. Americans, for better or worse (mostly worse), absolutely love their Walmart and can’t Lewis is not going to convince his target audience to put aside their desire to buy every product under one roof to believe that Walmart is a pet project of Socialist Kenyan Barack Obama’s secret effort to kill honest capitalism in America.

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