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Happy New Year!
The Texas governor's ties to the Jewish state stretch back to his time as agriculture commissioner
Ever since it became apparent that Texas Gov. Rick Perry was a staunch defender of Israel, and all the more so when a video emerged showing him joining rabbis in a spirited Hanukkah dance in the governor's office last year, the roots of his long-standing affection for the nation state have been a subject of speculation in some quarters. Was it oil? The religious affinities of a conservative Christian? Or was it a shared fighting spirit? Perry, after all, once drew a connection between Masada, the site of a siege during the First Jewish-Roman War, and the Alamo.
After Perry gave a speech on Israel at the W Hotel in New York City late last month, Maggie Haberman of Politico picked up on a detail that points to yet another explanation. In 2009, Perry told the Jerusalem Post that part of the Texas-Israel "connection that goes back many years" included the reality that "Israel has a lot we can learn from, especially in the areas of water conservation and semi-arid land." It raised the possibility that at the root of Perry's deep commitment and professed connection to Israel doesn't lie in what Texas has in abundance -- oil, faith, orneriness -- but what it lacks: water.
For eight years in the '90s, while Texas agriculture commissioner, Perry helped to lead the Texas-Israel Exchange, a program that aims to transfer knowledge between the two lands, where farming is a way of life but the water to do it with is often difficult to come by.
"Get a globe and draw a line from Texas to Israel," observes Prof. David Eaton, a water expert at the University of Texas' Lyndon B. Johnson School of Public Affairs. "They're basically the same neck of the woods." Indeed, as far as latitudes go, they are: Austin and much of Israel both sit at 31º North of the Equator. "Texas isn't England," says Eaton, continuing to lay out the similarities. "We've got wet years, dry years, geographic variability. They've got South Israel and North Israel, and we've got East Texas and West Texas." Homeowners in El Paso, says Eaton, are being encouraged to practice xeriscaping, the art of having a lawn that requires little hydration by virtue of it being filled with low-water plants, rocks, and pebbles. It's a method of landscape beautification that is traced back to Israel -- and its often strict residential water restrictions. Texas' mountain aquifers have their equivalent in Israel's karst aquifers. "You can't be theoretical with farming," says Eaton. "You want to have it done in the field with real farmers. So many of the conditions of uncertainty are consistent between the two that it makes for a really useful parallel. Israel doesn't have enough water, but they've figured out how to succeed."
Begun back in the mid-'80s, the Texas-Israel Exchange has experimented with a variety of technologies to try to squeeze the maximum possible water from dry land, and to make the most out of what does exist at the surface. One early $50,000 grant under TIE, as it's known, studied whether some plants could be watered with salt water. (It worked for Blackfoot daises; on velvet sage, not so much.) Drought-resistant Israeli grains were cultivated for their genetic material so that they might be tried in Texas. One major effort involved using drip irrigation to grow rice, rather than the water-hogging flood irrigation method in more general use. The Lower Colorado River Authority and the Tel Aviv-based firm Netafim partnered on the project; proponents say it can grow the same amount of rice with half the water. Then there are projects focused on water reclamation -- that it, using treated waste water, including sewage, to irrigate, cool, or in manufacturing processes. For both sea-adjacent lands, desalination through either evaporation or forcing the salt water through a permeable membrane is seen to have potential. Texas has its eyes on its 350 miles of coast along the Gulf of Mexico, and what it says is 2.7 billion acre-feet of brackish groundwater. In 2002, Perry, then governor ordered the Texas Water Development Board to explore whether the state might build a large-scale desalination plant that might produce for Texans a supply of fresh drinking water.
The partnership between Texas and Israel officially began under Perry's predecessor as agriculture commissioner, Democrat Jim Hightower, who held the post for two terms in the '80s before becoming a liberal radio personality. And in something of a strange political twist, some observers say that one person that Perry might have to thank for his early and frequent exposure to the needs of Israel is...the Rev. Jesse Jackson.
Steven A. Moore, director of the sustainable design program at the University of Texas, wrote a 2001 book on Laredo's Blueprint Farm, one of the earliest fruits of the Texas-Israel partnership. Hightower became a prominent national supporter of Jackson's presidential bid, writes Moore. That created problems for Hightower when, shortly after Jackson made a high-profile visit to Texas, he was quoted in the Washington Post referring to Jewish Americans as "hymies." The incumbent commissioner soon planned a trip to Israel, saying that Texas "should take its cue from Israel's water conservation pioneers." Analyzes Moore, "Hightower's dramatic and timely construction of common cause with Israel was born a brilliant solution to political (and agricultural) problems."
It was while touring Israeli kibbutzim that Hightower met Avraham Katz-Oz, Israel's deputy minister of agriculture. The next year, Katz-Oz visited Texas, and the Texas-Israel exchange program was born soon thereafter. As Hightower tells it in his own book, the partnership's origin was as a new kind of "global trade deal" that brought together "plain old dirt farmers" and others on the lower rungs of Texas farming society with their counterparts in Israel. In 1991, the relationship was further formalized with the creation of a Texas-Israel Fund Board, focused on paying for applied research between the two places. That same year, Perry -- who beat Hightower in the race for agriculture commissioner in part by playing up the Hightower-Jackson connection -- took his first trip to Israel.
Perry made himself a champion of the Texas-Israel knowledge exchange. But, says Moore today, "what Rick Perry wouldn't say is that it originated under Jim Hightower."
It's origins notwithstanding, Perry became a staunch advocate for the Israel research partnership. In a 1996 op-ed in the Austin American-Statesman, Perry bragged about teaming up with Israel, "a country known for using technology to turn a desert into an agricultural oasis of productivity." For Perry, the emotional impact of the Texas drought ran deep: "If you asked an old-timer what two events in this century left their imprints the deepest in the minds of rural Texans, I'll bet the answer would be the Great Depression and the drought of the 1950s." Even if, for him, the pain was somewhat removed: "They both spawned more hardship for grown folks than most of us can imagine today. I lived through the big drought but l had my pony and my dog, so I didn't pay much attention to my dad sitting at the kitchen table scratching out figures on a Big Chief tablet."
About ten years after authoring the newspaper piece, Perry, now governor, solidified his intellectual debt to Israel, with the creation of the Texas-Israel Chamber of Commerce, "a private, not-for-profit business organization whose aim is to boost the economies of Texas and Israel by helping member companies develop important business relationships with each other and explore new market opportunities," with a focus on high-tech collaborations. Today, the Chamber claims as its two main champions Perry and Israel's Ministry of Industry, Trade, and Labor.
Contacts between U.S. states and Israel aren't, of course, exclusive to Texas. Among the states whose governors have made recent trade missions to Israel are Massachusetts, Rhode Island, and Oregon; Virginia maintains a tech alliance focused on encouraging Israeli companies to do business in the commonwealth. But, going back as it does more than quarter century, the exchange between the state of Texas and the state of Israel is generally considered the oldest such relationship, and it is certainly one of the most robust.
The Texas-Israel Exchange program has had its critics. The Sunset Advisory Commission is a body of the Texas legislature that evaluates the state's government agencies with an eye towards identifying and eliminating "waste, duplication, and inefficiency." In its once-every-12-years review of the Texas Department of Agriculture, conducted in 2008, the commission, citing the $500,000 in grants paid out through TIE in 2008 and 2009, found that the program was too much of a black box. "The Texas-Israel Exchange Fund Board provides funding for agricultural research projects intended to be of mutual benefit to Texas and Israel," wrote the commission in its report. "While the program is able to leverage state dollars to fund useful research for Texas agriculture, the funding for and results of these projects are not transparent to the Legislature, the agriculture industry, or the public. The same functions could be provided by an advisory committee, rather than a semi-independent board." The board was indeed abolished, and its functions rolled back into the department as a whole. Eaton also points to the obstacles inherent in trying to move farmers into new and, in their eyes, potentially, untested ways of farming. "You're changing how people farm," he says. "You're changing how you go to market. It's a challenge."
The reality, of course, is that both Israel and Texas continue to struggle with water. Israel, mindful of the mid-60s "Water Over Water" concerning rights to the Sea of Galilee -- thought to have contributed to the tensions sparking the Six Day War -- has worked to bring online major new desalination plants. This summer, the country said that with the completion of a plant in Ashdod, "desal" water -- expensive, energy-intensive desalinated water -- would now make up 75 percent of the water consumed by its people. And Texas, of course, is in the midst of a drought of historic proportions, one that the state's existing water system can't cope with. The lack of water is reported to have caused some $5.2 billion of economic pain to the state's agricultural sector, and the state has been ravaged by fires. On the latest U.S. Drought Monitor color-coded map of drought conditions, Texas is nothing but a big angry red ball. Some three-quarters of the state is suffering through "exceptional" drought conditions, and the state climatologist is warning that this situationcould continue through 2020.
Perry, who said during a September presidential debate that climate change science is "not settled" and seemingly compared global warming doubters to Galileo, has coupled his belief in the benefits of knowledge transfer with a faith of the more spiritual variety. In April, Perry declared a long weekend of prayer. "It seems right and fitting that the people of Texas should join together in prayer," reads the proclamation from his office, "to humbly seek an end to this devastating drought and these dangerous wildfires." Texans might be forgiven for getting down on their knees. A scary 2012 draft state water plan from the Texas Water Development Board recently found that unless the skies open up, the state "does not and will not have enough water to meet the needs of its people, its businesses, and its agricultural enterprises."
It's a major challenge. For the Israelis' part, the Consulate General for the southwestern U.S. has stated that "with water set to become the oil of the 21st century," research jointly funded by Texas and entities in Israel "will be essential in helping stretch this precious natural resource as far as possible in two arid agricultural producing areas: Texas and Israel." The severity of Texas and Israel's shared challenge is something that Perry seems to have been attuned to for at least two decades now, and understanding his approach to Israel would seem to require paying a good deal of attention not just to oil, but to water.
The Iowa caucuses are an electoral event in which residents of theU.S. state of Iowa meet in precinct caucuses in all of Iowa's 1,784 precincts and elect delegates to the corresponding county conventions. There are 99 counties in Iowa and thus 99 conventions. These county conventions then select delegates for both Iowa'sCongressional District Convention and the State Convention, which eventually choose the delegates for the presidential nominating conventions (the national conventions). The 2012 Iowa Caucuses are scheduled to take place on January 3, 2012.[1]
The Iowa caucuses are noteworthy for the amount of media attention they receive during U.S. presidential election years. Since 1972, the Iowa caucuses have been the first major electoral event of the nominating process for President of the United States. Although only about one percent of the nation's delegates are chosen by the Iowa State Convention, the Iowa caucuses have served as an early indication of which candidates for president might win the nomination of their political party at that party's national convention.
The Iowa caucuses are commonly recognized as the first step in the U.S. presidential nomination process for both the Democratic and the Republican Parties. They came to national attention in 1972 with a series of articles in The New York Times on how non-primary states choose their delegates for the national conventions. Democratic operative, Norma S. Matthews, state co-chair of the George McGovern campaign, helped engineer the early January start for Iowa. McGovern finished second to Edmund Muskie in the first early Iowa caucuses, but the momentum was sufficient for an ultimate Democratic nomination in 1972 for McGovern in Miami. Four years later, the Iowa Republican Party scheduled its party caucuses on the same date as the Democrats'.
In 1976, an uncommitted slate received the most support, followed by former Georgia governor Jimmy Carter, who came in a distant second, but won the most votes of any actual candidate. With no dominant front runner at the time, Carter was able to use the publicity of his "win" to achieve victory in the New Hampshire primary, and then to win his party's nomination and eventually the Presidency. Since then, Presidential candidates have increased their focus on winning the Iowa caucus.
In 1980, Republicans began the tradition of holding a straw poll at their caucuses, giving the appearance of a primary election. George H. W. Bush campaigned extensively in Iowa, defeating Ronald Reagan, but ultimately failed to win the nomination.
While they have been a financial boon to the state, the political value of the Iowa caucuses has gone up and down over the years. In 1988, for example, the candidates who eventually won the nominations of both parties came in third in Iowa. In elections without a sitting president or vice president, the Iowa winner has gone on to the nomination only about half the time (see below).
When Iowa senator Tom Harkin ran for the Democratic nomination in 1992, none of the other Democratic candidates chose to compete in Iowa, which minimized its importance in the nomination process. President George H. W. Bush was unopposed on the Republican side.
While the Democrats have tried to preserve the position of Iowa and New Hampshire in their nominating schedules, the Republicans have not. Alaska and Hawaii generally have their Republican caucuses before Iowa, and in 1988 the Hawaii victory of Pat Robertson and the 1996 Louisiana victory of Pat Buchanan over Senator Phil Gramm had a significant impact on the results in Iowa.
The caucuses are closely followed by the media and can be an important factor in determining who remains in the race and who drops out. However, the only non-incumbent candidates to win their party's caucus and go on to win the general election were George W. Bush in 2000 and Barack Obama in 2008. Neither Reagan nor Bill Clinton won prior to their first terms. No incumbent President has run opposed in his own party's caucus since Jimmy Carter in 1980.
In the months leading up to the 2004 caucus, predictions showed candidates Dick Gephardt and Howard Deanneck-and-neck for first place, with John Kerry and John Edwards far behind them. Negative campaign ads attacking each other by the two front runners soured the voters on them, and a last minute decision by Kerry to put all his remaining money in Iowa swung voters towards him. Gephardt's presidential hopes were dashed and Dean's badly battered, as Kerry went on to become the third non-incumbent to win both Iowa and New Hampshire since Edmund Muskie in 1972 and Al Gore in 2000.
The Iowa caucuses operate very differently from the more common primary election used by most other states (seeU.S. presidential primary). The caucuses are generally defined as "gatherings of neighbors." Rather than going topolls and casting ballots, Iowans gather at a set location in each of Iowa's 1,784 precincts. Typically, these meetings occur in schools, churches, public libraries and even individuals' houses. The caucuses are held every two years, but the ones that receive national attention are the presidential preference caucuses held every four years. In addition to the voting and the presidential preference choices, caucus-goers begin the process of writing their parties’ platforms by introducing resolutions.[2]
Unlike the first-in-the-nation primary in New Hampshire, the Iowa caucus does not result directly in national delegates for each candidate. Instead, caucus-goers elect delegates to county conventions, who in turn elect delegates to district and state conventions where Iowa's national convention delegates are selected. Ironically, the state conventions do not take place until the end of the primary and caucus season: Iowa is in fact one of the very last states to choose its delegates.[3][4]
The Republicans and Democrats each hold their own set of caucuses subject to their own particular rules that change from time to time. Participants in each party's caucuses must be registered with that party. Participants can change their registration at the caucus location. Additionally, 17-year-olds can participate, as long as they will be 18 years old by the date of the general election. Observers are allowed to attend, as long as they do not become actively involved in the debate and voting process. For example, members of the media and campaign staff and volunteers attend many of the precinct caucuses. Youth who will not be eligible to vote by the date of the general election may also attend as observers and may volunteer to attend the county convention as youth delegates.[5]
For the Republicans, the Iowa caucuses follow (and should not be confused with) the Ames Straw Poll in August of the preceding year. Out of the five Ames Straw Poll iterations, the winner of the Ames Straw Poll failed to win the Iowa caucuses twice, in 1987 and 2007.
In the Republican caucuses, each voter officially casts his or her vote by secret ballot. Voters are presented blank sheets of paper with no candidate names on them.[6] After listening to some campaigning for each candidate by caucus participants, they write their choices down and the Republican Party of Iowa tabulates the results at each precinct and transmits them to the media.[7] In 2008, some precincts used a show of hands [8] or preprinted ballots.[9]The non-binding results are tabulated and reported to the state party, which releases the results to the media. Delegates from the precinct caucuses go on to the county conventions, which choose delegates to the district conventions, which in turn selects delegates to the Iowa State Convention. Thus, it is the Republican Iowa State Convention, not the precinct caucuses, which selects the ultimate delegates from Iowa to the Republican National Convention. All delegates are officially unbound from the results of the precinct caucus, although media organizations either estimate delegate numbers by estimating county convention results or simply divide them proportionally.
The process used by the Democrats is more complex than the Republican Party caucus process. Each precinct divides its delegate seats among the candidates in proportion to caucus goers' votes. Participants indicate their support for a particular candidate by standing in a designated area of the caucus site (forming a preference group). An area may also be designated for undecided participants. Then, for roughly 30 minutes, participants try to convince their neighbors to support their candidates. Each preference group might informally deputize a few members to recruit supporters from the other groups and, in particular, from among those undecided. Undecided participants might visit each preference group to ask its members about their candidate.
After 30 minutes, the electioneering is temporarily halted and the supporters for each candidate are counted. At this point, the caucus officials determine which candidates are viable. Depending on the number of county delegates to be elected, the viability threshold is 15% of attendees. For a candidate to receive any delegates from a particular precinct, he or she must have the support of at least the percentage of participants required by the viability threshold. Once viability is determined, participants have roughly another 30 minutes to realign: the supporters of inviable candidates may find a viable candidate to support, join together with supporters of another inviable candidate to secure a delegate for one of the two, or choose to abstain. This realignment is a crucial distinction of caucuses in that (unlike a primary) being a voter's second candidate of choice can help a candidate.
When the voting is closed, a final head count is conducted, and each precinct apportions delegates to the county convention. These numbers are reported to the state party, which counts the total number of delegates for each candidate and reports the results to the media. Most of the participants go home, leaving a few to finish the business of the caucus: each preference group elects its delegates, and then the groups reconvene to elect local party officers and discuss the platform.
The delegates chosen by the precinct then go to a later caucus, the county convention, to choose delegates to the district convention and state convention. Most of the delegates to the Democratic National Convention are selected at the district convention, with the remaining ones selected at the state convention. Delegates to each level of convention are initially bound to support their chosen candidate but can later switch in a process very similar to what goes on at the precinct level; however, as major shifts in delegate support are rare, the media declares the candidate with the most delegates on the precinct caucus night the winner, and relatively little attention is paid to the later caucuses.
In 2004, the meetings ran from 6:30 p.m. until approximately 8:00 p.m. on January 19, 2004, with a turnout of about 124,000 caucus-goers.[10] The county convention occurred on March 13, the district convention on April 24, and the state convention on June 26. Delegates could and did change their votes based on further developments in the race; for instance, in 2004 the delegates pledged to Dick Gephardt, who left the race after the precinct caucuses, chose a different candidate to support at the county, district, and state level.
The number of delegates each candidate receives eventually determines how many state delegates from Iowa that candidate will have at the Democratic National Convention. Iowa sends 56 delegates to the DNC out of a total 4,366.
Of the 45 delegates that were chosen through the caucus system, 29 were chosen at the district level. Ten delegates were at-large delegates, and six were "party leader and elected official" (PLEO) delegates; these were assigned at the state convention. There were also 11 other delegates, eight of whom were appointed from local Democratic National Committee members - two were PLEO delegates and one was elected at the state Democratic convention.
The 2008 Iowa caucuses took place January 3 at 7 p.m. CT.[11] Candidates spent tens of millions of dollars on local television advertisements[12] and hundreds of paid staff[13] in dozens of field offices.[14] Barack Obama and Mike Huckabee were the eventual winners.
Candidates in bold eventually won their party's nomination. Candidates in italics subsequently won the general election.
Ruler of new beginnings, gates and doors, the first hour of the day, the first day of the month, and the first month of the year, the Roman god Janus gave January its name.
He was pictured as two-headed and situated so that one head looked forward into the new year while the other took a retrospective view.
Posted via email from Religion
To laugh is to risk appearing the fool;
To weep is to risk appearing sentimental;
To reach out for another is to risk involvement;
To expose feelings is to risk exposing true self;
To place your ideas, your dreams before the crowd is to risk their loss;
To love is to risk not being loved in return;
To live is to risk dying;
To hope is to risk despair;
To try is to risk failure;
But risk must be taken, because the greatest hazard in life is to risk nothing;
The person who risks nothing, does nothing, has nothing and is nothing;
He may avoid suffering and sorrow, but he simply cannot learn, feel, change, grow, love and live;
Chained by his certitudes, he is a slave and has forfeited freedom’
Only a person who risks is free.
-William Arthur Ward
| Q: I think the idea of Satan is a myth, dreamed up by people who couldn't think of any other way to explain why evil exists. We alone are responsible when we do bad things, and we can't blame some imaginary devil. -- C.M. A: Let me ask you a question: How do you explain the existence of evil, if there is no evil spiritual force working behind the scenes of this world? After all, evil isn't just an absence of good; evil is real, and evil is aggressive and destructive. Can you come up with a better explanation than the existence of Satan, as he is portrayed in the Bible? I doubt it. The Bible calls him "The great dragon... who leads the whole world astray" (Revelation 12:9). Jesus called him "a murderer from the beginning, not holding to the truth, for there is no truth in him.... he is a liar and the father of lies" (John 8:44). It has been said that one of the devil's greatest tricks is to make people believe he doesn't exist -- and that's true. When we deny his existence, we become blinded to the reality of evil, and we fall for his lies about God and about ourselves. But Satan is real; our headlines scream it every day. The most important truth, however, about the devil is this: He is a defeated foe! By His death Jesus overcame Satan's charges against us, and by His resurrection Jesus conquered Satan's rule of death. And some day Christ's victory over Satan will be complete, and Satan and his demons will be banished forever. Don't be deceived, but turn to Jesus Christ and build your life on His truth. He alone can give us hope, both now and forever. |
Posted via email from Religion
Crony capitalism is a term describing a capitalist economy in which success in business depends on close relationships between business people and government officials. It may be exhibited by favoritism in the distribution of legal permits, government grants, special tax breaks, and so forth.
Crony capitalism is believed to arise when political cronyism spills over into the business world; self-serving friendships and family ties between businessmen and the government influence the economy and society to the extent that it corrupts public-serving economic and political ideals.
In its lightest form, crony capitalism consists of collusion among market players. While perhaps lightly competing against each other, they will present a unified front to the government in requesting subsidies or aid (sometimes called a trade association or industry trade group). Newcomers to a market may find it difficult to find loans or acquire shelf space to sell their product; in technological fields, they may be accused of infringing on patents that the established competitors never invoke against each other. Distribution networks will refuse to aid the entrant. That said, there will still be competitors who "crack" the system when the legal barriers are light, especially where the old guard has become inefficient and is failing to meet the needs of the market. Of course, some of these upstarts may then join with the established networks to help deter any other new competitors. Examples of this have been argued to include the keiretsu of post-war Japan, the print media in India, the chaebol of South Korea, and the powerful families who control much of the investment in Latin America.
Crony capitalism is generally associated with more virulent government intervention, however. Intentionally ambiguous laws and regulations are common in such systems. Taken strictly, such laws would greatly impede practically all business; in practice, they are only erratically enforced. The specter of having such laws suddenly brought down upon a business provides incentive to stay in the good graces of political officials. Troublesome rivals who have overstepped their bounds can have the laws suddenly enforced against them, leading to fines or even jail time.
States often said to exhibit crony capitalism include the People's Republic of China; India, especially up to the early 1990s when manufacturing was strictly controlled by the government (the "Licence Raj"); Indonesia; Argentina;[2] Brazil; Malaysia; Russia;[3] and most other ex-Eastern Bloc states. Critics claim that government connections are almost indispensable to business success in these countries. Wu Jinglian, one of China's leading economists[4] and a longtime champion of its transition to free markets, says that it faces two starkly contrasting futures: a market economy under the rule of law or crony capitalism.[5]
More direct government involvement can lead to specific areas of crony capitalism, even if the economy as a whole may be healthy. Governments will, often in good faith, establish government agencies to regulate an industry. However, the members of an industry have a very strong interest in the actions of a regulatory body, while the rest of the citizenry are only lightly affected. As a result, it is not uncommon for current industry players to gain control of the "watchdog" and use it against competitors. This phenomenon is known as regulatory capture.
A famous early example in the United States would be the Interstate Commerce Commission, which was established in 1887 to regulate the railroad "robber barons"; instead, it quickly became controlled by the railroads, which set up a permit system that was used to deny access to new entrants and functionally legalized price fixing.[6]
An example from 2004 would be the case of Creekstone Farms. After the mad cow scare, Creekstone decided to test all its cows for mad cow disease. This would enable them to sell again to Japan, which had blocked import of all American beef that had not been completely tested. After the proper facilities had been built and the personnel hired to make such a change, the U.S. Department of Agriculture issued an injunction and refused to allow Creekstone to buy the kits necessary to test.[7] This allowed the larger beef producers to keep costs low and not be out-competed by a smaller rival. Creekstone sued the USDA in response for abrogating free competition in the market. Economist Paul Krugman commented that the incident showed that "the imperatives of crony capitalism trump[ed] professed faith in free markets," at least for the Department of Agriculture at the time.[8]
The military-industrial complex in the United States is often described as an example of crony capitalism in an industry. Connections with The Pentagon and lobbyists in Washington are described by critics as more important than actual competition, due to the political and secretive nature of defense contracts. In the Airbus-Boeing WTO dispute, Airbus (which receives outright subsidies from European governments) has stated Boeing receives similar subsidies, which are hidden as inefficient defense contracts.[9] In another example, Bechtel, claiming that it should have had a chance to bid for certain contracts, said Halliburton had received no-bid contracts due to having cronies in the Bush administration.
Gerald P. O'Driscoll, former vice president at the Federal Reserve Bank of Dallas, stated that Fannie Mae and Freddie Mac became examples of crony capitalism. Government backing let Fannie and Freddie dominate mortgage underwriting. "The politicians created the mortgage giants, which then returned some of the profits to the pols - sometimes directly, as campaign funds; sometimes as "contributions" to favored constituents."[10]
In an article titled "The Occupy Wall Street Movement and the Coming Demise of Crony Capitalism", author and economics professor Ravi Batra argues that "all official economic measures adopted since 1981...have devastated the middle class" and that the Occupy Wall Street movement should push for their repeal and thus end the influence of the super wealthy in the political process.[11]
In its worst form, crony capitalism can devolve into simple corruption, where any pretense of a free market is dispensed with. Bribes to government officials are considered de rigueur andtax evasion is common; this is seen in many parts of Africa, for instance. This is sometimes called plutocracy (rule by wealth) or kleptocracy (rule by theft).
Corrupt governments may favor one set of business owners who have close ties to the government over others. This may also be done with racial, religious, or ethnic favoritsm; for instance, Alawites in Syria have a disproportionate share of power in the government and business there. (President Assad is an Alawite.)[12] This can be explained by considering personal relationships as a social network. As government and business leaders try to accomplish various things, they naturally turn to other powerful people for support in their endeavors. These people form hubs in the network. In a developing country those hubs may be very few, thus concentrating economic and political power in a small interlocking group.
Normally, this will be untenable to maintain in business; new entrants will affect the market. However, if business and government are entwined, then the government can maintain the small-hub network.
Critics of capitalism including socialists and other anti-capitalists often assert that crony capitalism is the inevitable result of any capitalist system. Jane Jacobs described it as a natural consequence of collusion between those managing power and trade, while Noam Chomsky has argued that the word "crony" is superfluous when describing capitalism.[13] Since businesses make money and money leads to political power, business will inevitably use their power to influence governments. Much of the impetus behind campaign finance reform in the United States and in other countries is an attempt to prevent economic power being used to take political power.
Socialist economists, such as Robin Hahnel, have criticized the term as an ideologically motivated attempt to cast what is in their view the fundamental problems of capitalism as avoidable irregularities[14]. Socialist economists dismiss the term as an apologetic for failures of neoliberal policy and, more fundamentally, their perception of the weaknesses of market allocation.
Laissez-faire economists oppose crony capitalism as well[15] disparaging governmental favors[16] as incompatible with a true free market[17]. Laissez-faire advocates criticize the term as an ideologically motivated attempt to cast what is in their view the fundamental problem of government intervention or “investments” as an avoidable aberration; free-market advocates refer to governmental favoritism as "crony socialism"[18], "venture socialism"[19] or "corporatism, a modern form of mercantilism"[20] to emphasize that the only way to run a profitable business in such systems is to have help from corrupt government officials[21] . In this view, high levels of interaction between corporations and governments are considered socialist, which is taken to its maximum in the form of nationalization of industries[22]. Even if the initial regulation was well-intentioned (to curb actual abuses), and even if the initial lobbying by corporations was well-intentioned (to reduce illogical regulations), the mixture of business and government stifle competition[23], a collusive result called regulatory capture. In his bookThe Myth of the Robber Barons, Burton W. Folsom, Jr. distinguished those that engage in crony capitalism—designated by him "political entrepreneurs"—from those who compete in the marketplace without special aid from government, whom he calls "market entrepreneurs" who succeed "by producing a quality product at a competitive price"[24]
