What is Crony Capitalism?

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PragerU

Self-improvement, History, Non-profit, Business, Education

4.8 • 6.9K Ratings

🗓️ 8 January 2019

⏱️ 5 minutes

🔗️ Recording | iTunes | RSS

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Summary

This election season there's a lot of talk about corruption, about politicians being "bought and sold", and about "crony capitalism". What do those terms mean? Why should we care? Is there a way to reduce corruption and restore our trust in government? Author Jay Cost, staff writer at The Weekly Standard, answers these questions and proposes a solution that every society could benefit from. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Chrony Capitalism.
0:02.3	What is it?
0:03.3	Why is it so bad?
0:05.7	To answer these questions, let's think about good old-fashioned capitalism.
0:09.4	It is premised on the free exchange of goods or services between independent agents.
0:14.7	Let's say I want to buy some cereal.
0:16.8	Steve's grocery is selling my brand for $4.
0:19.6	Ted's grocery has it for $5.
0:21.6	I buy from Steve, which creates the most value for both me and him.
0:26.4	Meanwhile, Ted now has an incentive to cut his costs so he can compete better.
0:31.0	Replicate this kind of transaction billions of times a day, 365 days a year, and that
0:36.7	is how our economy functions and grows.
0:39.6	Or at least how it's supposed to.
0:42.0	Now what about Chrony Capitalism?
0:44.6	Let's say it's the government that wants to buy some cereal.
0:47.9	More specifically, the House of Representatives Committee for Serial Acquisition is put in
0:52.3	charge of the task.
0:53.9	Steve still sells for $4.
0:55.9	Ted for $5.
0:57.3	I buy from Steve.
0:58.6	He's the low price man.
1:00.2	But the committee for cereal acquisition buys from Ted.
	...

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