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Wednesday, October 26, 2011

Nicholas Kristof, "Crony Capitalism Comes Home": His Worst Opinion Piece Ever

Nicholas Kristof has written many fatuous New York Times op-eds. In one 2010 opinion piece entitled "New Alarm Bells About Chemicals and Cancer" (http://www.nytimes.com/2010/05/06/opinion/06kristof.html), Kristof began by stating:

"The President’s Cancer Panel is the Mount Everest of the medical mainstream, so it is astonishing to learn that it is poised to join ranks with the organic food movement and declare: chemicals threaten our bodies."

Apparently, Kristof was blithely unaware that our bodies consist of chemicals, but ignorance has never prevented him from foisting twaddle upon the The Times's readership.

Kristof today introduces the readership of The New York Times to a new bugaboo, crony capitalism, in his latest op-ed, "Crony Capitalism Comes Home" (http://www.nytimes.com/2011/10/27/opinion/kristof-crony-capitalism-comes-homes.html?hp). However, Kristof begins with a defense of the Occupy Wall Street movement:

"Whenever I write about Occupy Wall Street, some readers ask me if the protesters really are half-naked Communists aiming to bring down the American economic system when they’re not doing drugs or having sex in public.

The answer is no. That alarmist view of the movement is a credit to the (prurient) imagination of its critics, and voyeurs of Occupy Wall Street will be disappointed."

Is it remotely possible that Kristof is unaware of the findings of pollster Douglas Schoen (http://online.wsj.com/article/SB10001424052970204479504576637082965745362.html) concerning the views of OWS protesters? Schoen determined:

"Our research shows clearly that the movement doesn't represent unemployed America and is not ideologically diverse. Rather, it comprises an unrepresentative segment of the electorate that believes in radical redistribution of wealth, civil disobedience and, in some instances, violence. Half (52%) have participated in a political movement before, virtually all (98%) say they would support civil disobedience to achieve their goals, and nearly one-third (31%) would support violence to advance their agenda."

Nicholas can deride the critics of OWS with inapposite sexual innuendo, but these statistics are indeed frightening.

Before going further astray along the fuzzy directions of this op-ed, let's return to its purported subject, i.e. crony capitalism. Although Kristof tells us that Lawrence Summers once opined that crony capitalism was to blame for the Asian financial crisis of the late 1990s, and he would have us believe that crony capitalism is to blame for America's current economic ills, he never troubles to define this term.

Allow me to assist Kristof. Crony capitalism involves a system whereby governments extend permits, grants, loans, tax credits, and other favors to connected persons in the business community.

Hey, doesn't that remind you of what happened with respect to Solyndra? Needless to say, Kristof doesn't go down that path.

Instead, Kristof provides a laundry list of distinguished persons who call for "structural change," recommend "broad-based job creation," and warn against "too much inequality" in a capitalist economy. But none of these persons are saying that the US is a banana republic suffering from crony capitalism.

Anyone familiar with this blog knows that I have long derided past excesses of America's financial institutions. I favor reenactment of Glass-Steagall; I favor reinstatement of the Uptick Rule. However, unlike Kristof, I do not perceive the United States as a banana republic.

Kristof concludes:

"So, yes, we face a threat to our capitalist system. But it’s not coming from half-naked anarchists manning the barricades at Occupy Wall Street protests. Rather, it comes from pinstriped apologists for a financial system that glides along without enough of the discipline of failure and that produces soaring inequality, socialist bank bailouts and unaccountable executives.

It’s time to take the crony out of capitalism, right here at home."

I am no apologist for the financial system, and I don't wear pinstripes. (As I type this blog entry, I am wearing sweat-stained gym shorts and a t-shirt covered in dog hair.) I do believe in correcting excesses without crashing the system. And unpleasant as it may have been, had Citibank and AIG not been rescued by the federal government, we would probably be back in the days of barter, with cow manure, for use as fertilizer to grow your own food, one of the world's most precious commodities.

Winston Churchill once said:

“It has been said that democracy is the worst form of government except all the others that have been tried.”

I think the same is true of capitalism as it pertains to systems of economics.

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