Showing posts with label corporatism. Show all posts
Showing posts with label corporatism. Show all posts

Sunday, December 11, 2011

It's Not a Free Marketplace...


...  when government restricts freedom of action

It's not a free marketplace when a union can cry for government to use its coercive powers to tell a company that it can't open that new airplane factory it just built. That is exactly what happened in the Boeing case that was just resolved.

The National Labor Relations Board has dropped its controversial case against airline manufacturer Boeing, which had become a lightning rod for conservatives.

The labor board argued for much of the past year that Boeing decided to locate a new plant to build its new 787 Dreamliner jets in South Carolina, a right-to-work state, in retaliation for strikes by unionized workers at its existing facilities in Washington state. (The Hill - NLRB Withdraws Boeing Case)
"Retaliation" is a natural reaction to market forces

What if Boeing decided to lower all wages by 10 dollars per hour and workers quit because of it, going to a company that pays more? Why isn't that worker retaliation against the company? A better question is, why would government prevent employers or employees from "retaliating?"  Retaliation is just a dirty word for a reaction to a previous market force. If Starbucks jacks up the price of a vento to $10 dollars a cup, I ain't buyin' no more coffee there.

Coercion is the Key to Progressivism 

This also reveals the coercive mindset of progressivism. There are still people in America today insisting that our economic decline is due to the decline of unions, despite the lack of evidence to support their contention. The only way enforced unionism works is if you chain down businesses and take away their free agency.

This is why Detroit, a once-thriving union dynamo, collapsed into a liberal junk heap. Union Labor bid its prices up too high, Big Business foolishly accepted, and government failed to protect them from the free market "retaliation."  Tens of thousands of manufacturing jobs headed south to non-union climes, and foreign imports further impinged upon the Big Labor-Big Business fantasy land of price-setting insulated from market forces.

Progressives would use government power to prevent such free-market reactions, setting up trade barriers that would spark trade wars resulting in higher consumer prices, tying down companies and forcing them to "take it," which is what the big three pretty much did voluntarily, to their ultimate detriment.

Communism, Fascism, Corporatism

Back in the bad old days, raw communism would do this by expropriating the capitalists' property, eventually running the confiscated enterprises into the ground, murdering those who resisted, and miring their societies in misery.

Fascism, communism's little leftist cousin, was more sophisticated, adding some sweeteners in for the bourgeoisie. Fascists were smart enough to leave the means of capital in the hands of the business owners; it was more convenient and efficient to just shake down everybody at the factory door as they left for the day.

The modern-day way of chaining down a corporation is with state-sponsored corporatism. Businesses will stay put so long as they are protected by an archipelago of government regulations, protections, exemptions and other formidable barriers that protect them from competition, giving them free rein to continually jack up prices with government-sanctioned impunity, making consumers a captive audience.  

As an added bonus, they can freely dip into the government coffers to the tune of tens of billions when their unsustainable business model inevitably fails.

Welcome to Corporate America.

Further Reading:
Rothbard - Power & Market, Ch 6

Thursday, December 8, 2011

The King's "New Socialism" Speech


President Obama is a pyromaniac in a field of strawmen.*

In Kansas, Obama railed against nefarious forces

“They want to go back to the same policies that stacked the deck against middle-class Americans for way too many years,” Obama said of the GOP. “And their philosophy is simple: We are better off when everybody is left to fend for themselves and play by their own rules.”
Just who are the people who believe this? I don’t know any. Playing by your own rules is perfectly ok in your own domain, but it has no place in a free marketplace. Free market capitalism is predicated upon a known set of rules that everyone must follow. You can’t steal from others or murder your opponents, for example. You can’t lie to your business partners or customers. And what specific policies “stack the deck against middle-class Americans?” Give us specifics!

Mickey Kaus (America's smartest liberal) homed in on Obama’s attempt to shame corporations into what Kaus calls patriotic charity: staying here and hiring people even if you have to lose money or forgo greater profits or productivity gains to do it:
A patriotic Charity Economy is a conveyor belt to corporatism!
After all, what happens when the factory of celebrated businessman X who recognizes his patriotic obligation to employ Americans at $20 an hour is faced with competition from uncelebrated, selfish businessman Y who employs Chinese ex-peasants at $2 an hour? Businessman X is going to need a “partnership” with government, sort of a pre-bailout bailout. Obama doesn’t seem to have a problem with this sort of cozy arrangment. (Kaus – Obama’s Charity Capitalism)
An Unfair Presidency

Obama compared capital gains tax apples to personal income tax oranges, excoriating greedy CEOs for paying less taxes than their secretaries (a blatant lie).

He decried a system of laws that does not treat everyone equally, as his administration favors certain companies (Solyndra, GM) over others.

He hectored companies for using modern technology like ATMs, digital phone switches and that newfangled contraption known as the internet, while his armed agents raid workplaces and he shuts down job-creating factories and pipelines.  And then he taunts his pornographic lover Big Biz for not hiring. The man is a walking, talking BS machine.
But by Obama's own measure, the country has gotten more "fair." The richest 1% now pays almost 40% of all federal income taxes, up from 25% two decades ago, while the bottom half pays only 2%, down from 6%. The federal regulatory state has never been as big, and government spending as a share of the economy is at record levels. (IBD)
Here’s the kicker:
the only winners since Obama took office have been corporations (profits are up 68%) and Wall Street investors (the Dow's up more than 45%). The rest of the country has gotten the shaft. (IBD)
I’d like to see him try to get reelected running on that...

As Socrates would say, let’s define our terms

Just what exactly is “fair?” Or a better question, what specifically is unfair here in the US? Wage disparity? Unequal outcomes? Can it be traced back to a root cause?

East coast Massachusetts kids named Kennedy have about a 100% chance of going to an Ivy League school, regardless of how dull they may be. Silverfiddle kids have about zero chance. Is that fair? Who knows? Who cares? It’s all a waste of time. We are individuals, our needs and wants are unique, and our efforts produce disparate and varied outcomes.

Now, if we find that a certain class of people is rounding up other people and kicking them and their progeny down a hole so as to keep them from pursuing their American dream, that would be unfair. I don’t see that happening in this country. We are not all born into identical circumstances, so equalization would be quite a task. Everywhere it’s been tried, those on top were dragged down, rather than those on the low end being elevated.

Rather than all this inflated fascistic rhetoric designed to whip the proles into a revolutionary frenzy, how about restoring the rule of law? Forcing Big Banking and Corporate America off of the government teat? How about getting the federal government’s snout out of every corner of our lives and allowing us to solve our problems at the lowest level?

Even the venerable bastion of corporate statism, The Washington Post, gave Obama’s Robespierre acid trip flashback in Kansas three Pinocchios for its bald-faced dishonesty.

* - William F. Buckley’s description of John Kenneth Galbraith

Further Reading:
Harsanyi – Obama vs Capitalism
NY Times – Obama Tongue Bath
IBD - A Lesson in Fairness for Obama
Obama Urges Fair Play