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Right Turn
Posted at 08:45 AM ET, 06/01/2012

Crony capitalism beyond Solyndra

Mitt Romney has hit pay dirt with Solyndra, or as Romney is now calling its headquarters, the “Taj Mahal.” (“Their corporate headquarters looked like the Taj Mahal, they had showers that looked like spa showers. . . . Oh, these guys were living high because it was government money, it was someone else’s money, it was the taxpayer’s money.”)

David Axelrod after all this time still has no adequate explanation for what went down:

Huh?

But the crony capitalism or “venture socialism” was not limited to Solyndra or even to the energy industry. The latest revelation about Obamacare aptly demonstrates the noxious connection between Big Pharm and big government. BloombergBusinessWeek reports:

Drugmakers led by Pfizer (PFE) Inc. agreed to run a “very significant public campaign” bankrolling political support for the 2010 health-care law, including TV ads, while the Obama administration promised to block provisions opposed by drugmakers, documents released by Republicans show.
The internal memos and e-mails for the first time unveil the industry’s plan to finance positive TV ads and supportive groups, along with providing $80 billion in discounts and taxes that were included in the law. The administration has previously denied the existence of a deal involving political support.

Most egregiously a secret deal was cut to block a measure that would have benefited consumers. It’s all laid out in e-mails. As Phil Klein explains:

As part of the final deal, PhRMA agreed to support health care legislation, spend millions on ads promoting it, and agree to $80 billion in savings and taxes to help finance the bill.
In exchange, PhRMA not only ended up with a law that promised to provide it with millions of new customers, but protected it against policies contemplated by Democrats that would have been harmful to their profits, such as introducing a government plan into the Medicare prescription drug program, allowing rebates for drug purchases through the program and drug re-importation.
Taken together, the e-mails paint a picture of insider deal making with a powerful special interest — something that stands in stark contrast to Obama’s campaign pledges.

This is President Obama’s idea, I suppose, of how American businesses are supposed to act. Government cuts secret deal with the politically well-connected, who get credits, carve-outs and sweetheart deals to get an advantage over competitors or other industries. In return the government gets business to spin for its expansion of power. And, oh well, the ones to get the short end of the stick are the voters. But they’ll never find out, so what’s the harm?

This favoritism is bad for business, for government and, most important, for ordinary voters. It transforms businessmen into political pleaders and makes government bureaucrats into micro-managers in fields in which they have no competence. Whether it is cutting deals with Big Pharm or feathering the nest of campaign contributors’ “green energy” boondoggles or creating slush funds via the Dodd-Frank legislation, the result is the same: distortion of the marketplace, expansion of government power, misuse of taxpayer dollars and domination of the marketplace by the politically connected.

Romney is right to keep hammering away at crony capitalism. If Democrats are smart, they will stop defending the indefensible and insist on breaking the nexus between big business and big government. (And let’s not forget Big Labor’s role in the cronyism racket, as we saw in the giveaway to United Auto Workers in the auto bailouts). If the Democrats were really the protector of the “little guy,” they’d insist on it. If Obama were really for transparent government and throwing the lobbyists out of the White House, he wouldn’t have done what he did in health-care, energy and financial “reform.”

By  |  08:45 AM ET, 06/01/2012

Categories:  2012 campaign, Obamacare

 
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