In essence, crony capitalism often creates private monopolies that hurt consumers compared to their welfare under competition. The excesses of cronyism have provided ammunition to parties of the left that are openly hostile to capitalism and neo-liberal policies. Yet when these parties come to power they usually do not reduce the importance of political influence but shift power to groups that support them. A distinguishing characteristic of Chile since the reforms of the early 1980's is the growth in competitive capitalism at the expense of crony capitalism. This shift more than anything else explains the economic rise of Chile during the past 25 years that has made Chile the most economically successful of all Latin American nations.
"Crony capitalism" is more or less what I had in mind writing about Mexicoil and cash crops yesterday. It amounts to a gentle kind of fascism, and runs counter to what every free-market-loving liberal and libertarian desires.
Yesterday I was lecturing my Modern History class about the Great Depression, and how the worst thing you can do when the stock market is tanking is panic. He who keep his head while everyone else loses theirs is likely to come out on top. Unfortunately, Latin America has been in one state of politico-economic panic or another for the last 200 years.
But wait, there's more! Donald Sensing has more of the costs leading to a declining birth rate. I'm less convinced that his assertions are as powerful as economic ones. There are plenty of us who don't really care what the feminists and eco-freaks think about our young'uns. But in the cultural centers on the coasts, the image of mass overpopulation and the toil and drudgery of Motherhood surely influences behavior.
We run from the wrong fears, and into the wrong solutions.
UPDATE: Mark Steyn has more, especially as relating to Hugo Chavez. You know, Mister President-for-Life.
No comments:
Post a Comment