Category Archives: Crony Capitalism

Mr. Obama and Pope Francis: who would’ve thought they’d agree on economics? Or do they?

Pope Francis recently released his Apostolic Exhortation, Evangelii Gaudium, which condemns “unfettered capitalism, “(as labeled by the press).  Pope Francis seemingly condemns something that never has been, nor does anyone seriously call for:  a laissez faire market devoid of morals or any constraining laws.  Indeed, the rule of law and morality are necessary for healthy functioning markets, since the foundation of markets (private property and the freedom to exchange) requires trust and enforcement of contracts.  An extended quote will fairly… Continue Reading ››

Hillary Clinton pulls in $450,000 in speaking fees, at a Financial Leadership Conference? What’s the deal here?

Now, I’m all for someone making money if they are providing a value added service.  But what, pray tell, is the service Mrs. Clinton is providing?  Why does the Chicago Mercantile Exchange find Mrs. Clinton’s leadership experience in financial leadership compelling enough that it would pay that kind of money? It cannot be her famed commodities trading experience. Am I just jealous?  Perhaps, (not really), but I think this is emblematic of our political economy problems in America today.  Rather… Continue Reading ››

Is There a Christian Defense of Markets?: Book Review

In their new book, published by Crossway in 2013, The Poverty of Nations: A Sustainable Solution, the authors Wayne Grudem and Barry Asmus tackle the issue of whether one can make a distinctively Christian defense of markets and economic growth.  The book involves a unique combination of authors and perspectives.  Grudem is a well-known and respected evangelical theologian while Asmus is a widely traveled and popular economist.  Together they have made what is a very rare (though hopefully not for long)… Continue Reading ››

Socialism makes fraud legal–evidence from Obamacare

Fellow Berean Mark Smith highlighted the President’s oft-repeated claim that if you like your health care you can keep it, characterizing it as misleading. Of course, many are using the stronger form of “lie” to describe this.  I remember at the US Air Force Academy, the definition of a lie in our honor code was “the intent to deceive.”  Ultimately, its pretty hard to know the intentions within a man’s heart.  So for the moment, let’s continue to give Mr.… Continue Reading ››

Obamacare sticker shock: “I was all for Obamacare until I found out I was paying for it”

There are so many dimensions of possible problems with Obamacare; the technical problems with the website are masking other much more problematic concerns.  Higher costs, fewer choices, and coercive mandates are only now being considered by consumers as the actual implementation of the law is upon us.  As I listen to the debates of the Obamacare implementation, conservatives against the bill are pointing to the lack of enrollment and choices in many areas.  Liberal supporters blame Republican lack of support–and… Continue Reading ››

The US Government and Romans 13: 1-7

How happy are you with the federal government? The government is partially shutdown. If Congress and the President are not able to negotiate a settlement to raise the debt ceiling, greater fiscal problems are on the horizon. The Affordable Care Act is more and more showing its strangling effect on our economy. The Dodd-Frank Act appears not to have solved the “too big to fail problem”. etc. Our government has given us very significant reasons to be dissatisfied. Romans 13:… Continue Reading ››

Obamacare / Kingcare

The economy is never stagnant, either with respect to its performance (GDP growth, inflation, unemployment rate, etc.) or with respect to the level and degree of government direction (more or less socialistic, more or less market driven, etc.). Our economy is becoming more and more socialistic. One clear marker on this road to serfdom is The Affordable Care Act (Obamacare). The Affordable Care Act establishes new economic intervention and bureaucracy and taxes to support the involvement. On August 19th Professor… Continue Reading ››

More Support for the Government as the Source of Entrepreneurial Innovation

From William Galston in the WSJ today.  Mr. Galston is referring to the same book that we commented on after the Financial Times of London made a similar review earlier this month.  Mr. Galston picks up on the theme that government spending on R&D has historically resulted in a lot of winners, including some of the most risky, whereas private capital goes for safer investments.  Mr. Galston goes from fact to assertion; can you see why? Second, the number of… Continue Reading ››

Crony Capitalism

This summer I asked my colleagues at Bereans at the Gate a question – How might we define “crony capitalism”? The consensus was that “rent seeking” – the explicit and direct use of time and money for economic gain without productive wealth creation – was at the root of crony capitalism. When we think of rent seeking we usually think of time and money spent to curry governmental privilege of some sort (a license, help with regulations, etc.) which will… Continue Reading ››

Case study in Boom/Bust economics–China’s empty cities

The Austrian theory of the business cycle is often misunderstood as an overinvestment theory–where too much investment causes a boom, which must be corrected by a bust.  Prominent economists such as Paul Krugman characterize it this way, Call it the overinvestment theory of recessions, or “liquidationism,” or just call it the “hangover theory.” It is the idea that slumps are the price we pay for booms, that the suffering the economy experiences during a recession is a necessary punishment for… Continue Reading ››