Wednesday, October 8, 2014

Book review: ‘Crapitalism,’ by Jason Mattera

Book review: ‘Crapitalism,’ by Jason Mattera:

Before digging into Jason Mattera’s new book, “Crapitalism: Liberals Who Make Millions Swiping Your Tax Dollars,” allow me to introduce the author with a few minutes of him chasing Lois Lerner, the Frau Blucher of the IRS scandal, onto her neighbor’s porch by asking if she regrets targeting conservative groups.  As Beetlejuice said of “The Exorcist,” I’ve watched this video about 167 times, and it keeps getting funnier every single time I see it.  Especially when you remember Lerner’s recent attempt to rehabilitate her image with a ridiculous softball interview in Politico, where she whined about how tough it was to maintain her expensive lifestyle on the $100k taxpayers are obliged to pay her every year, for the rest of her life.  I get the impression her neighbors didn’t catch that interview.  They don’t seem terribly fond of her.



“Crapitalism” concerns the fusion of Big Government and Big Business, which has been variously described as “corporatism” or “crony capitalism.”  One of Mattera’s objectives is to show that when Big Government is throwing sacks of taxpayer cash around, it’s hard to tell where “partnership” ends, and corruption begins.  Crapitalism has gotten a lot worse during the Obama years, but many of the stories Mattera relates pre-date the current presidency, and he notes early on that legalized corruption has a strong bipartisan appeal.

“When government gets in the business of picking winners and losers, free market competition – the ‘muscles’ that animate capitalism – begin to atrophy,” Mattera explains.  “That’s what big government Leftists want.  Sadly, it’s also what some corporatist Republicans want as well.  Republicans like Jeffrey Immelt, the head of General Electric.  He’s taken cronyism to a stratospheric level, going as far as to call Uncle Sam a ‘key partner.’  And later on, you’ll see he wasn’t kidding.  GE has lobbied its ‘partner’ to impose regulations, mandates, and other edicts that boost its bottom line.  Hell, if you look up the definition of ‘corporate welfare’ in an online dictionary, you may get back ‘General Electric’ as the answer.”

As promised, Jeffrey Immelt gets his own chapter, along with names familiar to critics of cronyism – Al Gore, George Soros,  Elon Musk – and some of the politicians most eager to serve them.  A few of the book’s targets might be eye-opening for those unaware of how many special breaks and incentives the extremely rich entertainment and sports industries enjoy.  One of the arguments commonly advanced to justify craptialist deals is that tax breaks for these industries are a wise investment (made on behalf of taxpayers, using their money, by politicians) because the stimulus to local economies from a big Hollywood production or sports arena will create loads of jobs.  Mattera examines many such arrangements, and finds little evidence they deliver anything close to what was promised, even when the subsidized production goes on to be highly profitable.  Taxpayers compelled to subsidize Hollywood enjoy a far smaller share of the profits than Democrat politicians and left-wing political causes.  It’s practically a money-laundering arrangement.  Between this book and his previous “Hollywood Hypocrites,” it’s fair to say a recurring theme of Jason’s work is exploring why young people inundated with class warfare are so willing to give the millionaire aristocracy of the entertainment world a total pass… even when they use taxpayers as piggy banks.

Businessmen with the right political connections, and fashionable Party pins, get a pass too.  Billionaire Warren Buffett’s purchase of political insulation by cozying up to the Left might be one of the shrewdest bargains the Sage of Omaha ever struck, especially when you consider his actual relationship with taxation, rather than what he says about it.  Ron Perelman went from being the king of corporate takeovers to a politically refined connoisseur of tax subsidies.  George Soros is what the Left accuses the Koch Brothers of being.  Perhaps the most remarkable example is environmentalist sugar daddy Tom Steyer, who bought the Democrat Party with cash on the barrelhead… and just coincidentally happens to have significant financial interests that benefit when his green activism cripples competitors.  There’s more than just pure ideology behind Steyer’s opposition to the Keystone XL pipeline…

It would be a grave error to dismiss Crapitalism as a fundamentally idealistic phenomenon.  This is how things work when the houses of government are filled with palms in need of greasing, and bags full of money for the taking.  Some of the stories Mattera tells are outrageous follies – you won’t be able to get the image of Justin Bieber’s chrome-plated electric car, “an obnoxious mirror that blinds fellow drivers whose taxpayer dollars were used to subsidize it,” out of your mind any time soon – while others were accompanied by rational plans laying out the potential benefits to taxpayers.  But remember, all of the Crapitalist deals in this book were presented as “investments” to the citizens who were forced to make them, very much including every green-energy disaster and electric-car debacle you can think of.  The “investments” were made with other people’s money, at little or no personal risk to the politicians who signed the papers.

It’s really not surprising that the results were quite different from what happens when people invest their own money, after carefully judging risks, rewards, and the consequences of failure.  Persuading people to actively support a venture, with a share of either profit or loss, is a very different proposition than convincing voters not to rise up in anger when crony deals are struck.  The language perfected by the Left to disguise these arrangements always makes them sound like something the entire body politic has decided to do together, but it’s really more about keeping the critics quiet until the ink dries on the contracts.  Crapitalism is a virus that imitates the form of capitalism, and steals its language, but contains little of its substance.

Capitalism nevertheless gets blamed for the shortcomings of Crapitalism, which is one reason politicians are so eager to forge these “partnerships” with the private sector.  It’s clear who will be left standing in the wreckage, holding the flaming steering wheel, when the enterprise crashes and burns.  Mattera begins his book by noting how much the public dislikes this state of affairs, citing polls that show huge majorities oppose crony capitalism, regard it primarily as an effort to pick their pockets, and believe the government has no business making “investments” in private companies.  And yet, when special interests successfully rebrand themselves as “activists,” that opposition drains away like water down a toilet.

A toilet metaphor headlines the concluding chapter, where Mattera judges that “a courtesy flush won’t do” to get rid of Crapitalism.  It’s not something that can be regulated away, since such regulations inevitably become anti-competitive weapons in the hands of those who know how to game the system.  Complicated “good government” laws can be folded into black swans of corruption by the masters of political origami.

“The answer is simple, actually,” Mattera proposes.  “Remove the incentives for Crapitalism entirely.  ‘Special’ interests will subside if bureaucrats aren’t in the business of selecting winners and losers.  Hey, if loons like Al Gore and Terry McCauliffe want to race their electric cars around the track to see whose catches fire first, fine, have at it.  But the duo would probably think twice about lobbying for their portion of green government grants if, you know, those green government grants didn’t exist in the first place.”

As pointed out in the chapter on Al Gore, the Pope of Global Warming raked in millions from a completely non-productive, fiscally irrational “industry,” carbon credits, that was whistled into existence entirely through government regulations based on junk science.  It’s not that hard for a bruiser as imposing as Uncle Sam to get protection rackets off the ground.  You can’t reform a system like that.  You can’t clean out the machinery that redistributes wealth and sells “success” to the well-connected.  Obviously, while “junk the system” is a simple solution, it’s not easy.  It will only happen if more Americans live up to those “cronyism sucks” poll numbers and accept that it’s not a problem to be solved by the people who created it, and profit from it.  “Crapitalism” offers a great, well-researched, and witty argument for the proposition that Big Clean Government is an oxymoron.



Original enclosures: