09 December 2009

"Pro-Business" vs. "Pro-Market"

Jonah Goldberg's latest column reads like an attempt at clarification or differentiation, an effort to define his own position on economic issues outside of the simplistic "liberal" vs. "conservative" framework. He implicitly identifies himself as one of the "libertarian-minded right" and as such complains about "how Republicans got stuck being 'the party of big business.'" In his view this is unfair, but his reason for saying so is unusual. He contends that "big business" all too often opposes the free-market principles of the "libertarian-minded right." They are quite happy to accept government regulation on the belief, Goldberg claims, that regulation will impose disadvantages on up-and-coming competitors while their influence over politicians allows them to structure the rules in their own favor.

"Going back to U.S. Steel and the railroads, the story of big business in America is often as not the story of fat cats rigging the system," Goldberg writes. Today, he endorses a fellow columnist's observation that "while everyone has been debating the government takeover of health care, what's really transpired is health care's takeover of government -- thanks to what he calls the 'medical-industrial complex.'"

If you think about it, this is a pretty radical critique of American society and politics, coming from a Republican. But where does it leave Republicans? Goldberg writes that "Too many Republicans think being pro-business is the same as being pro-market. They defend the status quo against bad [sic?] reforms and think they've defended economic freedom. The status quo stinks. And the sooner Republicans learn that, the sooner they'll deserve to win again."

Maybe this is an early stirring of post-Bailout conservatism, but what practical form can it take? Goldberg's position is that big business too often grows disinclined to play by free-market rules. It grows unwilling to test itself in fair competition with up-and-coming entrepreneurs and exploits government to consolidate and preserve its advantageous position. Big-government liberalism is complicit in this process; Goldberg describes the liberal motive as "it's easier to steer a few giant oxen than a thousand cats." A libertarian might argue that big business would not be able to cheat and defy the market without a big-government regulatory apparatus to manipulate. But if companies grow "too big to compete" in their own minds, if they become conservative (in a non-ideological sense) rather than competitive, doesn't that mean that "the market," that legendary self-regulating mechanism for maximizing human goods, is incapable of governing that anti-competitive, conservative impulse that comes, perhaps inevitably, to exactly those people who have heretofore played by the market's rules and won? For that matter, who's to say that government is some kind of third party to this generational sort of struggle. If it comes naturally to the successful to exploit government to their advantage, is it unreasonable to suggest that government itself, as practiced in the developed world, comes not from some non-entrepreneurial lust for power, as libertarians seem to believe, but precisely from that impulse on the part of the initially successful to hold on to what they've got? Wouldn't it then be imperative for people like Goldberg, who believe in the freedom of newcomers to compete with entrenched interests for the public benefit, to propose not just dismantling the presumably corrupt sort of regulatory government we have today, but the construction of a new, more effective and thus necessarily more powerful government that would not be susceptible to the blandishments of big business but would set the rules of competition, or commerce itself, so inflexibly that no amount of money would entitle one to appeal against it. There's a paradox for Goldberg to ponder: for the market to be truly free, society may need more and better government. But it may only look like a paradox if you've been deluding yourself in the first place.

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