Cronyism

That question leads to Dartmouth College economics professor Douglas Irwin’s “A Brief History of International Trade Policy,” which is well worth the read for anyone interested. It’s a topic that I’ve written about frequently during the presidency of Donald Trump. Some examples: Tariffs, like minimum wage hikes, are based…

The Hollywood Reporter is the latest publication to fall for bogus numbers from Georgia on the economic impact of its film tax incentives program.

Here's how media are often lazy in failing to recognize cronyism: they'll suspend their suspicion of big business getting cozy with government when that coziness coincides with their own political preferences.

Last week's signing of House Bill 363 was an example of beating back a public-choice problem. That bill frees up craft breweries from the strict 25,00-barrel-per-year cap on self-distribution. This system gave distributors a great deal of power but forced brewers into a tough choice not based on market dynamics: stay small or give up all distribution to a third party.

If it passed, then maybe states could stop wasting money on hysterical ingrate outsiders trying to dictate state policy with what has to be the stupidest extortion attempt ever devised: If you don't do what we say, we won't take your money!

Last week I wrote a post on "Cronyism and public-choice problems." I realized I kept discussing the term without providing much background on it. Here's more on a very important insight in economics.

On occasion, when discussion another example of cronyism, I have called it a "public-choice problem." What does that mean?

This, I submit, is the same process we see when subsidized professional sports teams start demanding bigger and greater stadiums and when large corporations or industries receiving huge state subsidies start applying political pressures.