One of my friends sent me this article from the Economist about the dangers of ties between corporations and government. It's an interesting piece, and although I don't agree with it completely it makes some good points.

Ministers and business bosses do, of course, share some goals: they both want faster economic growth, and they often both want jobs to be created or, in the common political parlance, “protected”. So the urge to co-operate is powerful, by ministers acting as salesmen abroad or slanting regulations, tax breaks and subsidies to promote desired outcomes at home. It is not always corrupt or self-serving or distorting, and is often done with honourable motives. But it still ought to be avoided, for five main reasons. ...

Third, interventions are never neutral. Money or privileges are given to one group at the expense, directly or indirectly, of others or of taxpayers in general. Even within an industry, the interests of the firms consulted may differ from those of other firms. Efforts to even things up just add to the costs.

This third reason is entirely true, but as Donald Sensing has pointed out, redistributing wealth is just about all governments can do. Every economic policy, including anti-trust prosecutions which the author here lauds, serves to move wealth from one group to another.
There is no single, big solution to campaign-finance abuse, interest-group influence or corporate privileges. As Mr Rauch wrote in his 1999 book “Government's End”, what is needed is a panoply of incremental changes: pressure to scrap corporate welfare; ...
It's important to remember that corporate welfare (such as agricultural subsidies) is sometimes a part of policies that extend beyond wealth maximization. For instance, it would not be good for America to be too dependent on foreign food supplies if we get into a major war that could disrupt shipping or damage our relationships with the nations selling us food.
... reforms to make tax systems neutral rather than preferential; ...
That certainly sounds nice, assuming the author is talking about a flat tax or something like it.
... more use of competitive contracts for public programmes to discourage their capture by particular interest groups; ...
We should privatize as many government employees and programs as possible and break the stranglehold the unions have on our bureaucracy. Look at the problems France is facing right now, and imagine America in another few decades.
... a more robust attitude by politicians to corporate pressure; ...
You can't change human nature, as the author recognizes earlier in the article.
... laws seeking to reduce the need for campaign money by handing out free advertising time on television; ...
What the heck?! Everything was making sense up to this point. Who gets to pick which issues/candidates get this "free" air time? And who ends up paying for the "free" air time? Moronic.
Without that Sisyphean effort, governments will just be crushed. And so, eventually, will be the freedoms both of capitalism and democracy.
Nonsense. Corporations are not self-existent entities with their own will and agenda. Corporations are owned by members of the democracy, and in fact more American citizens now own stock in public corporations than have at any time in the past. If anything, democracy is moving into corporate culture more quickly than corporations are moving into government.



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