Article will continue after advertisement

Crony capitalism is when the government gives out special favors—from competition-crushing regulations to bailouts—to well-connected businesses.

It’s a dangerous, unfair manipulation of the economy which costs taxpayers a lot of money while reducing our options in the marketplace. And this elitist interference in the market isn’t something the government just needs to reduce; it’s a power the government shouldn’t have at all. Only if the government has nothing to sell will corrupted and corrupting corporations have nothing to buy.

Well, the bad news is that the most likely Democratic and Republican presidential nominees, Hillary Clinton and Donald Trump, are both crony capitalists par excellence.


The evidence for each is ample. While in the senate and the State Department, Clinton gave a helping hand to foreign arms dealers and Fortune 100 companies who also happened to be Clinton Foundation donors.

She’s also well-known as the favored candidate of bailed-out, “too big to fail” Wall Street:

[T]he big bankers love Clinton, and by and large they badly want her to be president. Many of the rich and powerful in the financial industry—among them, Goldman Sachs CEO Lloyd Blankfein, Morgan Stanley CEO James Gorman, Tom Nides, a powerful vice chairman at Morgan Stanley, and the heads of JPMorganChase and Bank of America—consider Clinton a pragmatic problem-solver not prone to populist rhetoric.

And, of course, she’s a big fan of the cronyist Ex-Im Bank:

The perpetual presidential hopeful told the crowd that the Ex-Im Bank is “a tool for us to be competitive in order to support our businesses exporting.” She claimed that those who oppose Ex-Im’s questionable lending practices to large, politically connected corporations are driven by ideology, not by evidence. Setting aside the fact that economists of all ideological backgrounds have amassed mountains of evidence that Ex-Im does not meaningfully improve U.S. exports or jobs, distorts international markets, and directly harms the 98 percent of unsubsidized workers, consumers, and exporters that don’t have friends in Washington, Hillary Clinton’s own support of Ex-Im isn’t exactly based on “evidence” either. In fact, Clinton maintains questionable political alliances with some of Ex-Im’s biggest beneficiaries.

On the other side, though Trump has attempted to position himself as an opponent of cronyism, his record is no better.

Most notoriously, he loves using eminent domain to steal land from other people for his own building projects—including the infamous story of the time he tried to take an elderly widow’s home to build a limousine parking lot.

That’s just the tip of the iceberg:

The conservative National Review pointed out that Trump has a history of avoiding the free market and instead getting in bed with the state. Last year, they wrote that “Trump became ‘partners’ with the City of New York to build a hotel in the 1970s — a deal that involved a 40-year property-tax abatement that saved him ‘tens of millions of dollars.’” A “tax abatement” may seem harmless, but it’s really no different than a government subsidy. When people refer to sports teams as “welfare queens,” it’s partly because the owners receive such large tax abatements. Trump’s case is no different.

In the 1990s, Trump asked Connecticut’s government to use their power to condemn five Bridgeport businesses so that he may use the land to build “a $350 million combined amusement park, shipping terminal and seaport village and office complex on the east side of the harbor.”

As his history of manipulating state regulations to his own advantage well demonstrates, Trump is not so much pro-free market as pro-his personal wealth, and he’s willing to use every dirty trick—and government favoritism—in pursuit of that goal.

In a Clinton vs. Trump race, crony capitalism is the real winner. That’s bad news for liberty, and it’s bad news for our economy.

Bonnie Kristian is a columnist at Rare, weekend editor at The Week, and a fellow at Defense Priorities. You can find more of her work at www.bonniekristian.com or follow her on Twitter @bonniekristian
View More Articles
Tags