Tuesday, January 17, 2012

What is Crony Capitalism in Greensboro and Guilford County?

Crony capitalism is a pejorative term
describing an allegedly capitalist economyin which success in business
depends on close relationships between businesspeople
and government officials.

Like the relationship with Greensboro's new lobbyist and Robbie Perkins?

Like the campaign contributions of the parents
of Greensboro's new lobbyist to Mayor Perkins?

It may be exhibited by favoritism in the distribution of legal permits,
government grants, special tax breaks, and so forth.

How many Greensboro City Council Members
were aware of the lobbyist's relationship with Mayor Perkins?

Crony capitalism is believed to arise
when political cronyism spills over into the business world;
self-serving friendships and family ties
between businessmen and the government
influence the economy and society
to the extent
that it corrupts public-serving economic and political ideals.

In its lightest form,
crony capitalism consists of collusion among market players.

Like government contracts, grants and interest free loans
for campaign contributors
like the business the City of Greensboro does
with many who finance Guilford County's political process?
.
While perhaps lightly competing against each other,
they will present a unified front to the government
in requesting subsidies or aid.

…it is not uncommon for current industry players
to gain control of the “watchdog” and use it against competitors.
.
This phenomenon is known as regulatory capture.
.
A famous early example in the United States
would be the Interstate Commerce Commission,
which was established in 1887 to regulate the railroad “robber barons;”
instead, it quickly became controlled by the railroads,
which set up a permit system that was used to deny access to new entrants.

Crony Capitalism

If Greensboro and Guilford County are infected with Crony Capitalism,
how can we fix our political system
to offer businesses looking to expand or relocate a level playing field?

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