Crony Capitalism: From GM to Greece, the Lies Keep Growing

WASHINGTON -- To understand the pertinence to America of events in Greece, notice General Motors' most recent misbehavior. A television commercial featuring CEO Ed Whitacre demonstrates the institutional murkiness and intellectual dishonesty that result when the line between public and private sectors disappears.

All of this has happened before, and all of this is happening again:

The Vampire Economy: Doing Business Under Fascism, By Ginter Reimann, 1939

From Mises:
“The Vampire Economy, by Guenter Reimann (1939) is a rare and wonderful thing: a detailed account of how the Nazis crushed the private sector and hamstrung the economy with vast regulations, violations of property rights, inflation, price controls, and taxes.”

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Reimann quotes from a businessman’s letter: “You have no idea how far state control goes and how much power the Nazi representatives have over our work. The worst of it is that they are so ignorant. These Nazi radicals think of nothing except ‘distributing the wealth.’ Some businessmen have even started studying Marxist theories, so that they will have a better understanding of the present economic system.

“While state representatives are busily engaged in investigating and interfering, our agents and salesmen are handicapped because they never know whether or not a sale at a higher price will mean denunciation as a ‘profiteer’ or ‘saboteur,’ followed by a prison sentence. You cannot imagine how taxation has increased. Yet everyone is afraid to complain. Everywhere there is a growing undercurrent of bitterness. Everyone has his doubts about the system, unless he is very young, very stupid, or is bound to it by the privileges he enjoys.

“There are terrible times coming. If only I had succeeded in smuggling out $10,000 or even $5,000, I would leave Germany with my family. Business friends of mine are convinced that it will be the turn of the ‘white Jews’ (which means us, Aryan businessmen) after the Jews have been expropriated. The difference between this and the Russian system is much less than you think, despite the fact that we are still independent businessmen.”

As Mises says, we are “independent” only in a decorous sense. Under fascism, explains this businessman, the capitalist “must be servile to the representatives of the state” and “must not insist on rights, and must not behave as if his private property rights were still sacred.” It’s the businessman, characteristically independent, who is “most likely to get into trouble with the Gestapo for having grumbled incautiously.”

Read more: The Free Market: Business Under Nazis http://mises.org/freemarket_detail.aspx?control=54&sortorder=articledate#ixzz0npL4ILiK

As I recall a fellow named Adolph, used debt to finance an economic miracle in Germany during the 1930s. However, by the time the 1930s were almost over, the interest on the debt was unsustainable. The good news for Adolph was that he invested his borrowed money into tanks, airplanes and soldiers. The bad news was he didn’t make enough of them to win. I have met a lot of Germans that claim WWII was caused by debt loads carried by Germany. Remembering this and looking at the percentages of debt loaned between countries it does’nt take much of push to cause the house of cards to fold. The most irresponsible agent in this game is obama who through away America’s savings and leverage on a an insurance policy. Imagine, America is asking China to float us several trillions of dollars so that we can buy ourselves government healthcare. BTW almost half of China has never seen a Doctor, much less had contact with western medicine. The morality of spending the next generations earnings on todays consumption and financing on the backs of 7th century peasents is really striking. Hope and change baby.

Hitler’s generals wanted another three years to arm, but he didn’t have the time as his Nazi debt spree was coming to an end as he wasn’t able to service the interest on the debts he ran off to buy/bribe/pay his various political factions. Seizing Europe was his way of overturning the card table. After that he didn’t need finance he just got things imported to keep German living standards high by the old fashion way, he stole it.

"Crony capitalism is NOT capitalism."

Adam Smith thought so. There are two kinds of capitalism, "competitive capitalism", where companies compete in the marketplace to provide customers with better goods and services, and "crony capitalism" (or "monopoly capitalism") where companies subvert government and/or law to favor themselves, and/or hurt their competitors.

Republicans seem not understand that difference. The thought is probably anathema here, but IMO Teddy Roosevelt and the anti-trust laws were right.

Here in America the National Socialist Democrat Workers Party (Nationalsozialistische Democrat Arbeiterpartei, abbreviated NSDAP or simply "the Nazi Party", or even more simply "the Democrats"), use strongarm tactics to remove Christianity from public view, rewrite history, attack traditional cultural institutions like the nuclear family and the Boy Scouts, and destroy scientists and professors who do not toe the line with regard to liberal Democrat doctrine on abortion, embryonic stem cells, evolution, religion, "global warming", etc.

And naturally, suppressing opposing opinion by floating such measures as the "fairness doctrine" perfectly fits the modus operandi. Ubama is already complaining about how Americans are getting too much information (AKA, the truth) and asserting that this harms the democratic process.

America's Democrats operate exactly the same way the original version of their party operated in Germany in the 1930s.

"Antitrust theory and history are both a myth and a hoax. The laws were never intended to help consumers (Robert Bork's protestations to the contrary) and their long historical track record is that they have not helped consumers. They have, instead, punished innovative and efficient business organizations while protecting less efficient competitors and every state-sanctioned monopoly. They have tended to make consumers poorer and the overall economy less efficient and they deserve to be repealed, not reformed. That the antitrust paradigm still can find support among a majority of economists, lawyers, and the public is a testament to intellectual laziness, to the power of special interest, and to decades of successful myth making."

Read more: A Politically Incorrect Guide to Antitrust Policy - D.T. Armentano - Mises Institute http://mises.org/daily/2694#5#ixzz0npcMuNps

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