an oil-and-gas company. Mitch Daniels, the head of the Office of Management and Budget, was a vice-president at Eli Lilly. Army Secretary Thomas White was the head of energy trading at Enron. Air Force Secretary James Roche came from Northrup Grumman. And Navy Secretary Gordon England put in time at General Dynamics. All these companies depend for success on regulatory approval, government largesse, or cartel-like machinations. This is especially true of the energy industry—the Bush Administration's finishing school—in which the greatest determinant of a company's annual performance is a price more or less fixed in Vienna by a cabal of sheikhs. [...]

Mind you, there's nothing inherently corrupt here. Lobbying, fixing, finagling: it's just business, of a kind. The point is that such ways of doing business have very little to do with free-market capitalism. They have more in common with crony capitalism, in which whom you know is more important than what you do and how you do it. That's the world Bush's key policymakers come out of: they've made their careers by circumventing the free market. Why expect them suddenly to embrace it?

Posted by at August 28, 2002 03:28 PM

Matt, it is an unintended (I hope) consequence of the liberal notion of big nanny government in the first place. The result is that all CEOs to some extent must be well-versed in the art of not just crony capitalism, but the naked craft of sucking government regulatory dick. Since government is such a huge club, one way you can get ahead is to somehow coopt that club and use it to beat your competitors over the head: Thus do established companies schmooze regulators to make entry requirements so high for new competition that the government, in effect, creates your cartel for you. I mean, is it your fault new company B can't meet the regulatory requirements your bought Senator A got crammed through congress as a special little favor to you?

You write about things like RIAA. Don't swallow the notion of government versus corporations. They are two sides of the same coin, and have been for years - no matter which party is in power.

Posted by: Bill Quick at August 29, 2002 07:30 PM
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