Crony capitalism is where private corporations recruit the government to serve their interests. Many people mistake this for an ill of capitalism. This line of thought often commences after a viewing of one of Michael Moore’s films.

And because of the outrageously voluminous occurrences of crony capitalism in the Obama administration, many staunch supporters of Obama then mistake him for someone who no longer cares for Karl Marx and think he somehow “betrayed” them.

However, crony capitalism has more in common with socialism, than with free market capitalism. And it is actually a symptom of big powerful government, which is always necessary in order to implement wide reaching socialist policies.

Under socialism, those who are considered “poor” lobby the government for special favors, or have the lobbying done on their behalf. Under crony capitalism, it is the wealthy and well connected who do the same. Unfortunately for the poor, it is easier for the wealthy and well connected to siphon favors from the government than it is for the poor. And once a government becomes powerful enough to “spread the wealth around” in the name of the poor, then it also becomes powerful enough to “spread the wealth around” in favor of the few and wealthy.

So to all those who are in favor of lots of socialism in America… single payer health care, cap and trade, increasing welfare, etc.: What do you expect? For the government to take more control of the economy, be able to redistribute taxpayer’s money as they see fit (“stimulus”) and then for politicians NOT to use that power to help their friends and supporters? For private corporations NOT to apply more effort into channeling increasing government power their way (a.k.a lobbying)?

Socialism and crony capitalism are a package deal. Crony capitalism is a side-effect of socialism. The very thing Michael Moore wants in America (socialism) leads to the very thing he vociferously protests (crony capitalism).

John Stossel’s program about crony capitalism is fantastic and well worth the watch:

- Part 1 -

- Part 2 -

- Part 3 -

- Part 4 -

- Part 5 -

- Part 6 -