On Saturday in Iowa, Sarah Palin showed a preview of what her as yet undeclared campaign for the presidency will focus on: crony capitalism. She called out as the number one problem, not the left vs right divide, not even the media, but the corrupt status quo in DC.
She unveiled a 5 point economic plan not simply as plan for growth but as a plan of attack on crony capitalism and the status quo. She calls it a “bona-fide pro-working man’s plan”.
Crony Capitalism is something that I, as an immigrant from a banana republic, have long seen as the major problem in the USA in this century, so as you can imagine I am very happy to see a Palin focus on this, and very interested in her approach to battling this. It is a problem that is not linked to party or ideology, but to culture and class stratification. So I think it is fair to conclude that there can be more than one way to attack this problem. In looking at her plan, I will take the position of taking it at face value and with what I hope is an objective, non-partisan point of view.
Here are the 5 points on Palin’s plan:
“This is first: All power not specifically delegated to the federal government by our Constitution is reserved for the states and for we the people. So, let’s enforce the 10th Amendment and devolve powers back locally where the Founders intended them to be.”
Crony Capitalism, as we see it today, is government almost completely in the pockets of big business. The power of government is used to serve the interests of corporations instead of citizens. Government has lost the trust of the citizenry. Seen in that light, it makes non-partisan sense to limit the damage government can do by limiting its power. Swing the pendulum the other way for a bit.
“We must repeal Obamacare! And rein in burdensome regulations that are a boot on our neck. Get government out of the way. Let the private sector breathe and grow. This will allow the confidence that businesses need in order to expand and hire more people.”
Crony capitalism does thrive on excessive regulation — that is, on the loopholing and grease and bribes that can be harvested to be exempted from regulation. As soon as Obamacare was enacted, we started to hear about more and more corporations getting waivers. Corruption thrives when government has a way to pick & choose when to enforce and when to look away.
“Third, no more run away debt. We must prioritize and cut. Cancel unused stimulus funds, and have that come to Jesus moment where we own up to the debt challenge that is entitlement reform. See, the reality is we will have entitlement reform; it’s just a matter of how we’re going to get there. We either do it ourselves or the world’s capital markets are going to shove it down our throats, and we’ll have no choice but to reform our entitlement programs.”
I seem to remember the country doing well when President Clinton balanced the budget, so I have no problem with that. As to the the third rail, I am unconvinced that any GOP President, with an antagonistic Democratic congress, will have greater success at touching the third rail than President Obama with a compliant Democratic congress. In other words, wake me when it actually happens.
“Fourth, it is time for America to become the energy superpower.”
She’s been consistent about “Drill, baby, drill” since 2008, and her point about energy independence being a national security issue is a good one. With no manufacturing, few exports, and literally zero job creation, drilling and extraction may very well be the simplest, fastest way to reboot the economy.
Her last point is, to me, the most eye-popping, and I am including the entire context of it:
“Fifth, we can and we will make America the most attractive country on earth to do business in. Here’s how we’re going to do this. Right now, we have the highest federal corporate income tax rate in the industrialized world. Did you know our rates are higher than China and communist Cuba? This doesn’t generate as much revenue as you would think, though, because many big corporations skirt federal taxes because they have the friends in D.C. who right the rules for the rest of us. This makes us less competitive and restrains our engine of prosperity. Heck, some businesses spend more time trying to figure out how to hide their profits than they do in generating more profits so that they can expand and hire more of us. So, to make America the most attractive and competitive place to do business, to set up shop here and hire people here, to attract capital from all over the globe that will lead to an explosion of growth, instead of chasing industry offshore, I propose to eliminate all federal corporate income tax. And hear me out on this. This is how we create millions of high-paying jobs. This is how we increase opportunity and prosperity for all.
But here’s the best part: To balance out any loss of federal revenue from this tax cut, we eliminate corporate welfare and all the loopholes and we eliminate bailouts. This is how we break the back of crony capitalism because it feeds off corporate welfare, which is just socialism for the very rich. We can change all of that. The message then to job-creating corporations is: We’ll unshackle you from the world’s highest federal corporate income tax rate, but you will stand or fall on your own, just like all the rest of us out on main street.
As a liberal, my first reaction is what? Aren’t corporations already getting a free ride, and now they won’t pay any income taxes? Isn’t it bad enough that GE paid no federal income taxes – now all corporations get excused too? But the more I think about it, the more it starts to make sense. GE for example, got its free ride as one of the many benefits of it’s close relationship with Obama – other benefits include no-bid contracts, CEO Immelt being selected as jobs Czar, etc. Halliburton enjoyed a similar cozy relationship with Cheney. This obviously harms the public through bad policy and federal fund misuse; but it also, less obviously, harms the public through it’s impact on competition and the market. Maybe there could be something to this idea of both leveling the playing field and detangling government and business in one stroke. There’s certainly more that can be said and debated on this point, probably worth another post or ten, so I’ll stop here for now.
Palin at the moment, yet to begin her official campaign, now has a more detailed economic plan than Obama 3 years into his presidency, can produce. More than that, she has focused her platform on the very real problem that assails the country, which no other candidate has the credentials to address. Whether her solutions are worth trying is something that needs to be discussed in the public square, away from the media that is complicit in this cronyism.