View Full Version : True Capitalists Are Pro-Market, Not Pro-Business

06-10-2012, 10:22 AM
This is an important distinction. It's made by Luigi Zingales in A Capitalism for the People: Recapturing the Lost Genius of American Prosperity. This is highlights of a look at the book.

True Capitalists Are Pro-Market, Not Pro-Business (http://www.bloomberg.com/news/2012-06-07/true-capitalists-are-pro-market-not-pro-business.html)
...Zingales, who seems to be something of a moderate libertarian, wants to rescue markets and competition from the forces that threaten them: overregulation on the left and, on the right, a pro-business (as opposed to pro-market) ideology.

...The great threat to our economic future, in his telling, is crony capitalism, along with other forms of rent- seeking that have become ubiquitous in a complex regulated state. Although much of the argument might seem to be standard public-choice theory, Zingales provides an enormous service by laying out such persuasive evidence....

Zingales considers the free market both a moral and economic imperative. He recognizes the current tide of populist anger, reflected in different ways in both the Tea Party and Occupy movements -- and that much of the anger is directed against capitalism in general and big business in particular. The real trouble, he contends, is the death of the Horatio Alger myth. People no longer believe that hard work and following the rules will get you ahead. The game, they believe, is fixed.

Zingales thinks they’re right. Special interests -- particularly big business and big labor -- hold too much influence over the divvying up of resources that has become among the most important functions of government. His solution, however, is less regulation, not more. He prefers fewer and simpler rules, and a government that encourages entrepreneurship without trying to become an entrepreneur....

...The genius of capitalism, he tells us, “is not private property, not the profit motive, but competition.”...

06-10-2012, 10:56 AM
I agree and add that the problem with big business is that it really is not constrained by the free market.

06-10-2012, 10:58 AM
Inasmuch as it seeks political means, iow, rent seeks, that is true. Limiting government would thus limit the political means available,.

06-10-2012, 11:03 AM
Inasmuch as it seeks political means, iow, rent seeks, that is true. Limiting government would thus limit the political means available,.

It would. But I wouldn't recommend holding your breath while you wait for the limiting of government. In the mean time I would vote in government officials who will put reasonable and effective regulations on big business. If we ever get around to limiting government, that would be ideal.

06-10-2012, 11:06 AM
That is what Luigi Zingales seems to argue. I have nothing against reasonable laws limited to conformance with the Constitution. Laws that exceed that will drive government to collapse.

06-10-2012, 11:11 AM