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A First Look At New Report On Crony Capitalism – Trillions In Corporate Welfare

Tyler Durden's picture




 

Submitted by Michael Krieger of Liberty Blitzkreg blog,

One of the primary topics on this website since it was launched has been the extremely destructive and explosive rise of crony capitalism throughout the USA. It is crony capitalism, as opposed to free markets, that has led to the gross inequality in American society we have today. Cronyism for the super wealthy starts at the very top with the Federal Reserve System, which consists of topdown economic central planners who manipulate the money supply and hence interest rates for the benefit of the financial oligarch class. It then trickles down through lobbyist money into the halls of Washington D.C., and ultimately filters down to local governments and then the average person on the street gaming welfare or disability.

As such, we now live in a culture of corruption and theft that is pervasive throughout society. One thing that bothers me to no end is when fake Republicans focus their criticism on struggling people who need welfare or food stamps to survive. They have this absurd notion that the whole welfare system doesn’t start with the multinational corporations and Central Banks at the top. In reality, it is at the top where the cancer starts, and that’s where we should focus in order to achieve real change.

That’s where a new report from Open the Books on corporate welfare comes in. In a preview of the publication, the organization notes:

If Republicans are going to get truly serious about cutting government spending, they are going to have to snip the umbilical cord from the Treasury to corporate America.  You can’t reform welfare programs for the poor until you’ve gotten Daddy Warbucks off the dole. Voters will insist on that — as well they should.

 

So why hasn’t it happened? Why hasn’t the GOP pledged to end corporate welfare as we know it?

 

Part of the explanation is that too many have gotten confused about the difference between free-market capitalism and crony capitalism.

 

Federal_Contract_Spending_Spirals

 

And part of the problem is corporate welfare that is so well hidden from public view in the budget that no one has really measured how big this mountain of giveaway cash to the Fortune 500 really is. Finding out is like trying to break into the CIA.

 

Until now. Open the Books, an Illinois-based watchdog group, has been scrupulously monitoring all federal grants, loans, direct payments and insurance subsidies flowing to individuals and companies.

 

It’s an attempt to force federal agencies to release information on where the $4 trillion budget is really spent — and Open the Books will release a new report on corporate welfare payments to the Fortune 100 companies from 2000 to 2012.

 

Over that period, the 100 received $1.2 trillion in payments from the federal government.

 

That number does not include the hundreds of billions of dollars in housing, bank and auto company bailouts in 2008 and 2009, because those payments and where they went are kept mostly invisible in the federal agency books.

As suspected, the biggest welfare queens in the U.S. are the super wealthy themselves, but they’d rather you focus on some single mother on welfare simply trying to survive.

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Wed, 03/26/2014 - 23:06 | 4597160 Ceylon tea
Ceylon tea's picture

Everyone is dependent on the government these days

Wed, 03/26/2014 - 23:15 | 4597188 Leto II
Leto II's picture

Who is John Galt?

Wed, 03/26/2014 - 23:59 | 4597313 philipat
philipat's picture

A toy store in Carnaby Street?

Thu, 03/27/2014 - 08:28 | 4597918 firstdivision
firstdivision's picture

A two-faced lying sack of shit.

Wed, 03/26/2014 - 23:09 | 4597162 kurt
kurt's picture

I knew this was going to happen when that Orville Reddenbach looking guy with the question marks on his jacket was selling his book on TV.

Thu, 03/27/2014 - 06:27 | 4597711 Wahooo
Wahooo's picture

Yep, a little cognitive dissonance going on. The article sorta lost me at

If Republicans are going to get truly serious about cutting government spending,

Wed, 03/26/2014 - 23:07 | 4597164 Jack Burton
Jack Burton's picture

This report just confirms what I have been posting since 2008. Been called a lot of names, including communist ,for pointing out the crony in modern capitalism. Some fucking fools still cling to a mistaken belief that modern finance capital is Capitalism. Far from it, it is communism for the 1%, government guarantee of their profits, no matter how bad the business model. 2008 proves this as fact.

Wed, 03/26/2014 - 23:13 | 4597185 GeorgeHayduke
GeorgeHayduke's picture

Yeah, pointing out the blemishes on the sacred cows riles up the true believers every time.

Wed, 03/26/2014 - 23:49 | 4597289 AlaricBalth
AlaricBalth's picture

This video, "What is capitalism?" circa 1948 is a nostalgic propaganda piece which shows how our economic system has devolved from the promise of the post war years to the crony socialist, faux capitalist system we have now.

http://m.youtube.com/watch?v=_VstTwFxNKk&feature=kp

(9 minutes)

Thu, 03/27/2014 - 00:03 | 4597194 Flakmeister
Flakmeister's picture

It's actually a synthesis of feudalism and fascism....

Thu, 03/27/2014 - 01:56 | 4597523 Colonel Klink
Colonel Klink's picture

Not often you get a greenie from me but I have to agree totally.

Thu, 03/27/2014 - 05:38 | 4597677 Mad_max
Mad_max's picture

fascism is socialism. read up on Mussolini and Hitler. Both socialist. Both ex marxist. Both merely came to conclusion that Marxism and class warfare was retarded, and fused they elements which were "pratical" (evil, yet pratical- such as statism, anti individualism etc) with corporations. Lenin came to same conclusion with the NEP.

Thu, 03/27/2014 - 09:13 | 4598065 Acet
Acet's picture

I don't know what kind of place do you get your MacCartist pap from (maybe the neocon media), but Socialism is all about common ownership of the means of production (hence the "Social" bit) which is almost the opposite of what we have today (with historically high levels of wealth concentration).

I don't really care about what Hitler or Mussolini did or were in their youthfull years, since it's pretty obvious by now that they were the kind of people who didn't really gave a shit about others and would pass themselves as whatever was handiest in order to get people to support them.

If your argument rests on two of the worst people who have ever lived having portrayed themselves in an honest way in their younger years, then I have a bridge I want to sell you in NY.

 

Furthermore, in your posts you don't seem to distinguish between the left-right axis and the freedom-control axis. Let me give you a clue:

- Socialist which is left wing is really broken into two main branches, one which believes in revolution and a "Dictatorship of the Proletariat" to control the means of production and another which believes in small tweaks to promote more equality but in general supports the idea that people should have the freedom to conduct their own business in their own way. Both believe that society should strive for a more equal playing field, but one defends centralised control while the other one defends just tweaking around the edges and leaving people alone for the most part. The former is called Communism and the later is called Social Democracy.

So while one could say that Fascism is like Communism (in that both are totalitarian and about control of people's lives), your statement that "Fascism is Socialism" is equivalent (and just as illogical) to saying that "Communism is Conservatism".

Thu, 03/27/2014 - 09:48 | 4598175 shovelhead
shovelhead's picture

Pretty simple actually.

Capitalism for the rich when there are profits.

Socialism for the people where they share the losses.

The perfect 'heads I win, tails you lose' synthesis.

Fairly pointless to argue who controls what ie. Govt vs Corp./ MIC. It is a symbiotic relationship in which one feeds the other in turns. Crony's need Govt. to allow their plunder in return for some of the spoils.

The different factions vie for more dominance in the ebb and flow but the result for Main St. is the same.

Pay More. You can name a shark Abbott or Costello but it doesn't matter.

It's still a shark.

Thu, 03/27/2014 - 07:15 | 4597763 barroter
barroter's picture

Agree. Instead of being bound to the land and lord and owing him a cut of your harvest, we have people bound to today's lords by debt.

Wed, 03/26/2014 - 23:35 | 4597244 Future Jim
Future Jim's picture

Both kinds of cronyism are explained in What is Wrong with the People.

Wed, 03/26/2014 - 23:42 | 4597254 Future Jim
Future Jim's picture

It's actually pretty hard to survive without the taint of cronyism, as is explained in The Honest Labor Amendment.

Wed, 03/26/2014 - 23:47 | 4597283 Future Jim
Future Jim's picture

"Been called a lot of names, including communist ,for pointing out the crony in modern capitalism."

I've never seen anyone on ZH defend crony capitalism. In fact, Ayn Rand hated crony capitalists more than just about anyone.

Thu, 03/27/2014 - 01:00 | 4597448 NemoDeNovo
NemoDeNovo's picture

Shhhh don't tell #LetThemEatRand that his/her head might EXPLODE on that one.

Thu, 03/27/2014 - 03:10 | 4597589 James_Cole
James_Cole's picture

Ayn Rand hated crony capitalists more than just about anyone.

She hated them all right, so much so that she kept the biggest of them in her close circle of friends lol

Rand and bff / disciple Greenspan

http://1.bp.blogspot.com/-iRz2T80wxfE/TaUGWX5KTgI/AAAAAAAABiU/13QyVlavqL...

Thu, 03/27/2014 - 08:31 | 4597924 LetThemEatRand
LetThemEatRand's picture

These guys are unable to see past words in fiction novels.  Reality is so much more difficult.

Thu, 03/27/2014 - 05:48 | 4597684 The Limerick King
The Limerick King's picture

This is false. Crony capitalists are much like sociopaths...and Rand worshipped sociopaths as her superheroes. Cut-out the bullshit about this evil bitch, whose theories helped pave the way to the destructive banking deregulation that blew-up the world economy.

Thu, 03/27/2014 - 06:17 | 4597703 Oldwood
Oldwood's picture

Yes. Regulation IS the answer. What our society needs is just a few more laws, a little more regulation, and it will be puurfect.

Thu, 03/27/2014 - 06:57 | 4597747 The Limerick King
The Limerick King's picture

Nice strawman attempt. That wasn't my point. Those with the power to destroy entire economies through greed and recklessness need to be regulated...any fool should realize this fact...unless of course you blindly subscribe to a philosophy based on the insane perception that selfishness is a virtue, charity is a sin, and laissez-faire economics will lead to a utopian society.

Thu, 03/27/2014 - 07:18 | 4597765 Oldwood
Oldwood's picture

We all understand regulation, but regulation is always an attempt to create a system that will prevent corruption, yet always ultimately enables it. My point is that central control is devil. It is the root of all of this. We may have "deregulated" banks, but do we have fewer people in oversight? NO. Did the SEC prevent Madoff from stealing billions? NO. Was it due to lack or regulation or was it due to the regulators, the overseers becoming corrupt or just plain ineffective? Everyone clamors for more control, more regulation, when what is needed is transparency and accountability, none of which comes from these "regulators". Systems are a static target that become easy to defeat or corrupt with time. They are simple rules made by man and can be circumvented by man. We deal with this every day that we interface with government or large corporations. No brain, no rationality or judgement. Simply following the rules, or least superficially to the  point of minimizing any accountability for the results. This is the fertile soil that corruption grows in, and it is shocked full of shit. There is no utopia. There is only freedom and those systems designed to minimize freedom. Utopia, in a leftist mind is where we all live in a prison, yet really don't mind because we are "cared for". Conformity in beliefs while maintaining the illusion of diversity.

Thu, 03/27/2014 - 08:59 | 4598019 The Limerick King
The Limerick King's picture

Those who deny the existence of evil are doomed to fall prey to it...this is the major problem with Rand and Keynes. Their philosophies discount man's potential for evil, and by doing so makes us defenceless to protect ourselves against it. You cannot claim that the evil of government is greater than the evil of individual/corporate control of capital when both parties are one in the same. This post is about the evil of crony capitalism...which would flourish in a totally unregulated system. At least now they require a conspiracy with government puppets to achieve their objective...so that sheeple don't realize how bad there getting screwed by the owners of all the capital. We have become a nation/world of debt slaves...this is what the owners of capital have brought to the world, even with the facade of a state regulatory system designed to prevent abuse of individuals. To think that even more powerful and therefore corrupt individuals acting in their own self interest, would lead to a more utopian outcome, is blatently inconsistent with man's nature!

Moral capitalism is our best hope...but not based on the twisted immorality of Ayn Rand.

Thu, 03/27/2014 - 09:13 | 4598066 LetThemEatRand
LetThemEatRand's picture

He speaks the truth,

While he argues with a meanie,

And for that and his insight,

He gets a Greenie.

Thu, 03/27/2014 - 09:31 | 4598114 acetinker
acetinker's picture

LK, It pains me to disagree, but... IIRC both Oldwood and I are small biz owners.  We know damn good and well to keep our heads on a swivel at all times, and be on the lookout for scheisters.  Nobody, and I mean nobody in gov't. or otherwise is looking out for us- We have to do that, and I gotta tell you that from my perspective, gov't. is the biggest scheister of all.

All this regulation is designed to exclude, not to protect.  IOW, the people and organizations we hope to reign in with 'regulation' are the very ones who write said regulations for gov't. to rubber stamp and pass into law.

Remember "We have to pass it to find out what's in it"?  Regulation my ass.

Thu, 03/27/2014 - 11:35 | 4598700 Hugh_Jorgan
Hugh_Jorgan's picture

When the individuals in a civil society no longer self-regulate their own behaviour and fail to share a common moral compass with each other, the problems that arise will ALWAYS result in a bigger, more fascistic government. The resulting government regulation and control programs historically deliver a struggling economy, rife corruption, and delusions of entitlement from a generally ignorant citizenry. We all know that this process is a positive feedback loop, a downward spiral that collapses quickly at the end. The solution is a rebirth of valuing self-regulation, born out of pain, poverty and oppression. Once the collapse happens, it will be a rough road to tip the scale back toward honor and integrity.

Thu, 03/27/2014 - 21:55 | 4601209 acetinker
acetinker's picture

You put an exclamation point on my assertion, whether you meant to or not, thanks.  When men (and women) value the medium of exchange over blood and earth, you can be sure that trouble lies ahead.

Be yourself, Hugh.  All the other spots are taken ;)

Thu, 03/27/2014 - 07:19 | 4597768 barroter
barroter's picture

We tried laissez-faire and what a disaster that turned out to be in 2008.  These pigs still want to be liberated.  Guess what they'll do again.

Thu, 03/27/2014 - 07:37 | 4597797 Abaco
Abaco's picture

What we tried wasn't laizzez-faire by any stretch of the imagination.

Thu, 03/27/2014 - 07:25 | 4597774 fattail
fattail's picture

They need a lamppost a lot more than regulation.  Regulation is the ultimate strawman.  Big banks write the regulations for everyone else and get them so onerous that no one else can afford to comply driving consolidation.  There is a reason that the tbtf are bigger five years after the collapse.

Without regulation the tbtf would be on the ash heap of history having met the ultimate arbiter of success or failure.

 

Truly unconditional Free market capitalism...  not this abomination we have now.

Thu, 03/27/2014 - 08:36 | 4597931 LetThemEatRand
LetThemEatRand's picture

Two sides of the same coin.  You argue against regulation because the oligarchs end up controlling the politicians and regulators, so you advocate for taking out the middle man.  I guess it would be more efficient, but same result.

Thu, 03/27/2014 - 08:59 | 4598016 Flakmeister
Flakmeister's picture

It is amazing how this point gets finessed with a nary a blink of the eye...

Thu, 03/27/2014 - 09:14 | 4598070 The Limerick King
The Limerick King's picture

It's truly beyond reason to argue that the solution to falling victim to powerful evil men, is to remove the stupid and/or corrupt men who are watching what they do to the public at large.

Thu, 03/27/2014 - 09:38 | 4598138 Greenskeeper_Carl
Greenskeeper_Carl's picture

I think if glass-steagall was brought back, we could do away with many of the more onerous regulations. And I don't think truly free markets would get us to where we are now. You know who loves heavy regulations and high taxes? Rich people. Oligarchs. TBTF. If a libertarian society along with truly free markets benefitted them, then why do none of them champion libertarianism, support Ron Paul, support smaller govt. None of these people are libertarians, because they thrive soley based on cronyism and govt bailouts, which wouldn't exist in the world I describe. And please don't say the kock brothers. They are not libertarians.

Thu, 03/27/2014 - 09:43 | 4598152 Bearwagon
Bearwagon's picture

I witnessed them days, when Glass-Steagall was still in force, and I can assure you that it didn't do any harm to the markets, to the contrary!  ;-)

Thu, 03/27/2014 - 10:08 | 4598259 shovelhead
shovelhead's picture

Being blackmailed by the threat of 'Financial Doom' ala Paulson and bailing out failed banks with public money is as far from lasses-faire as you can possibly get.

Fuck off and die would be lasses-faire and we all would have been better off if we had adhered to that.

The only ones that would get hurt was the 30-1 leveraged degenerate gamblers and their .1 % backers.

Thu, 03/27/2014 - 07:51 | 4597832 Meta_Consciousness
Meta_Consciousness's picture

Your regulators snort blow, play with their private parts, surf porn and drink on the job.

 

They lie to congress, to Americans and get paid for it.

 

You want regulation? You HAVE regulation. 

The only regulators who get much done were installed by a republican. Their only recent failure was being unable to regulate dust. They've been hugely successful at saving little fishes and voles and things like that. /SARCASM

In all honesty, air quality has improved when manufacturing was voted off the island of reality show tv known as America. I don't credit the epa for that, though.

 

Your regulators are cheap whores. They're easily distracted by a step club and porno sites.

Please bring an actual idea rather than ideology.

Thu, 03/27/2014 - 07:42 | 4597811 Charles Nelson ...
Charles Nelson Reilly's picture

Yeah, Dagny Taggert was a real sociopath? Didn't realize Ayn Rand's philosophy was the model for a bunch of elite socialist Keynesians to destroy the world. I'm sure Larry Summers knows every character in Atlas Shrugged?

I enjoy your limericks, but this post is flat out fucking stupid.

Thu, 03/27/2014 - 08:38 | 4597944 LetThemEatRand
LetThemEatRand's picture

Who was Dagny Taggert again?  Oh, a character in a fiction novel.  I personally prefer to build my own political philosophy around the Die Hard franchise.  It had better special effects and Willis was one tough mofo who could really get things done.  

Thu, 03/27/2014 - 08:59 | 4598015 Dumpster Fire
Dumpster Fire's picture

I'm long a shitload of screen doors

Thu, 03/27/2014 - 09:08 | 4598042 The Limerick King
The Limerick King's picture

Gee...I wonder if Allen Greenspan may have discussed Rand's views on deregulation with his fellow "Committee That Saved The World" member??? I'm sorry that you can't grasp and/or disagree with the concepts I'm discussing...but that's no reason to launch an ad-hominem attack.

Wed, 03/26/2014 - 23:57 | 4597309 chinoslims
chinoslims's picture

Socialism for the rich and capitalism for the poor.

Thu, 03/27/2014 - 00:39 | 4597396 KickIce
KickIce's picture

That's certainly part of the plan, make capitalism take the blame so people are eager to adopt communism/socialism.

Thu, 03/27/2014 - 06:58 | 4597748 jerry_theking_lawler
jerry_theking_lawler's picture

We have a form of corporatism now....think we are teetering and leaning towards either Statism or Facism....

I have never experience true Capitalism in the USSA...and I am not a young man either.

 

http://en.wikipedia.org/wiki/Corporatism

http://en.wikipedia.org/wiki/Statism

http://en.wikipedia.org/wiki/Fascism

Thu, 03/27/2014 - 08:42 | 4597953 LetThemEatRand
LetThemEatRand's picture

You have never experienced true Capitalism because it has never existed and never will, except perhaps in the form of its cousin feudalism.  There will always be corruption by those with huge amounts of capital, and the Lord/Serf model is the inevitable result of anything approaching true unregulated reign of oligarchs.  America worked because there were checks and balances and the people gave themselves power to prevent rule by the guy with the biggest checkbook.  Unfortunately, the guys with the biggest checkbooks have figured out how to usurp the system with a money influenced political system and the Fed -- a cartel of private banks -- controlling the economy.

Thu, 03/27/2014 - 08:31 | 4597923 firstdivision
firstdivision's picture

I consider it an honor when some Red/Blue team cheerleader calls me names.  It means I've negated all of their rhetoric to moot.

 

Thu, 03/27/2014 - 08:36 | 4597942 Ghostdog
Ghostdog's picture

It not communism, it's fascism but point taken

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