America’s Crony Capitalism

The battle against crony capitalism starts in theclassroom, and we professors are inevitably implicated.

And, to do that, an energetic civil society must demand anend to crony capitalism.

Buenos Aires – For 20 years, Americans have denounced the“crony capitalism” of Third World countries, especially in Asia.

Like swine flu, crony capitalism has migrated from corrupt Third World countries to America, once the citadel of sound publicand private governance.

Its economy is a variant of crony capitalism, in whicheconomic success depends on one’s political connections, ratherthan on the meritocratic free-market competition from which libertygrows.

For example, when the East Asian financial crisis brokeout, there followed a systematic attempt to pin the blame on theaffected countries: “crony capitalism” allegedly had somehowcrippled their economies!

Many of Ukraine’s richest citizens, who gained their wealththrough the crony capitalism that is the only way Yanukovich knowshow to govern, remain unreconciled to Ukraine’s democracy.

The "capitalism" which developed subsequently was a classic case of "crony" capitalism. Opportunities, loans, licenses and contracts were distributed in accordance with a logic of allegiance, kinship and patronage, with the regime clans and regions benefiting greatly.

Negative developments, such as capital flight and crony capitalism, can weaken national currencies and cause wide social damage, while national measures to address social contract issues, such as labour rights, can become deterrents to foreign investment;