Writes Ian Birrell over at The Independent:
Above all, we see it with talk – and not just on the left – of capitalism being in crisis and the need for fierce new regulation.
This is wrong. It is capitalism, after all, that is spreading prosperity and well-being around the world – and with such stunning effect across Asia, Latin America and Africa. I am always struck by anti-capitalist rants I see hammered out on the latest tablet. The problem is crony capitalism.
“Crony capitalism” is a euphemism for an especially perverse form of government intervention — an unholy marriage between government elites and businessmen with political pull that characterizes a “mixed economy.” Yet it is Capitalism that gets the blame.
It is this form of it – sneered at in developing nations – which has taken a grip in the West as the power of corporate giants has grown. As Freeland says, super-elites are often the product of a strong market economy, but as their influence grows, they can stifle it.
But they can only do so with the government interventions such as “protectionism” and “Too Big To Fail” laws.
Capitalism remains a uniquely vigorous force. Just look at the pace of change in the unfettered technology industry. But ask why those banks that wrecked the economy – and, in the case of the retail ones, are often loathed by their customers – have not been replaced by more dynamic entrants instead of being salvaged by the state. […]
What we need to do is unleash capitalism in this country rather than restrain it. Politicians should focus not on headline-grabbing stunts like the mansion tax but on ensuring that the big players in complacent industries such as banking, energy, retailing and, yes, outsourcing, are less entrenched, less protected by their friends in Whitehall. [i.e., government] Transparency, technology and consumer anger can drive change.
To do this, we do not need more regulation, we need better regulation – […]. Above all, we need politicians who have learned the key lesson of recent years: that there is a huge difference between being pro-business and pro-market. [“From Banks to the ‘big six’ energy companies – more capitalism, not less of it, is the answer – Comment – Voices – The Independent”]
Or rather, to be pro-market is to treat all businesses equally, under a rule of law guided by the principle of individual rights, as opposed to granting favors to some while punishing others in the name of an ever fluid “public interest.”