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Big Business Privilege is Poisoning American Free Enterprise

The Tea Party rebellion is about many things – Obamacare, the failure of the establishment Republican Party to deliver the conservative government it promised during the Bush years... But perhaps most importantly, it is a rebellion against the culture of privilege which now poisons American politics and business.

Wall StreetNowhere was the pernicious effect of this culture of privilege more poisonous – and obvious – than in the Wall Street/Washington Axis that led the lobbying effort behind the bailouts of 2008 and 2009.

In the name of preventing a meltdown of the economy, politicians began picking winners and losers in the market and trillions of taxpayer dollars were spent to bailout banks, brokerage houses and automobile companies -- and to subsidize others to create “green” jobs or pursue other non-economic political goals.

As a result, the favored companies prospered, while those with less influence foundered and were acquired by those with better balance sheets, and better lobbyists.

But anyone who thinks this culture of big business privilege ended with the TARP program and the auto bailouts is sadly mistaken.

Big business lobbying continues to be the major hurdle to real budget and spending reform in Washington, and to individual consumers escaping the clutches of established corporations through competition.

Witness the recent passage of the so-called “highway bill.”  Inserted into this pork-filled monstrosity was a provision to regulate "roll your own" or RYO tobacco shops as “manufacturers,” essentially shutting down the Mom and Pop operations that allowed consumers to save up to half the cost of a carton of cigarettes by going to a local tobacco shop and rolling their own cigarettes.

Who was behind this dark-of-the night addition to the highway bill?  The major tobacco companies who decided to eliminate their small competitors through lobbying -- not competition -- and got the provision inserted in the bill.

In "The Pathology of Privilege: The Economic Consequences of Government Favoritism," Mercatus Center senior research fellow Matt Mitchell has taken the study of the effects of the Wall Street/Washington Axis and other expressions of big business privilege in the marketplace beyond the anecdotal evidence free market advocates and libertarians have felt in their gut.

Mitchell’s research shows that obtaining and keeping government-granted privilege is now a fundamental business strategy of big business, and that such privilege is not only unfair in the abstract -- it is an incredible economic drag on consumers and taxpayers.

For Tea Partiers and others concerned about maintaining American economic liberty, Mitchell’s research adds important academic underpinning to their argument that America is becoming a “bailout nation,” where the Wall Street/Washington Axis of big business and big government -- and their addiction to taxpayer money and regulation -- have become today’s greatest threat to free enterprise.

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We need to move power out of Washington

The only solution to this Wall Street/K Street/Capitol Hill power nexus is to pull power away from Washington back to the states and the people as originally contemplated by the Constitution.  The most fundamental way to accomplish this would be to reform the constitutional amendment process so that amendments restoring the original limits on federal power could be initiated and enacted by the states without having to go through either Congress or the unworkable and dangerous mechanism of a convention.  See http://www.timelyrenewed.com

Corporate/Wall Street

 he corporations and Wall Street are our major problem. The financial casino of Wall Street and the corruption of big busines are ruining the country. I don't see any solutions on the horizon -  left, right, center, Tea Party, whatever? Greed forever.