By killing transparency and competition, crony capitalism is harmful to free enterprise, opportunity, and economic growth. And by substituting special interests for the public interest, it is harmful to democratic expression.
Interpretation
Crony capitalism undermines competition and transparency, negatively impacting free enterprise and democracy.
This quote highlights the detrimental effects of crony capitalism, which favors special interests over the common good, ultimately stifling competition and transparency in the market. By doing so, it hampers economic growth and restricts opportunities for individuals, while also eroding the foundations of democratic expression and public welfare.
In practice
During an economic conference, to emphasize the importance of fair competition in markets.
The U.S. should worry about the effects of its polices on the rest of the world. We would like to live in a world where countries take into account the effect of their policies on other countries and do what is right, broadly, rather than what is just right given the circumstances of that country.
Customers often value a good more when its price goes up. One reason may be its signaling value. An expensive handcrafted mechanical watch may tell time no more accurately than a cheap quartz model; but, because few people can afford one, buying it signals that the owner is rich.
The problem with forbearance is that it always looks like a good thing to do until it stops working.
Perhaps the hardest challenge has been to persuade the public, impatient for rapid growth, of the need to ensure stability first. Growth, it is argued, is always more important, regardless of the looming economic risks.
Too many years away from academia renders you pretty incompetent at research and teaching. So I had to go back.
The gap in India has always been between the promise and the execution.
Developing economies may not have much control over the headwinds that they face today, but that does not mean that they are powerless. Much can be done not just to sustain moderate growth but also to secure a more prosperous and resilient future.
It is rather a problem of how to secure the best use of resources known to any of the members of society, for ends whose relative importance only those individuals know.
Markets as well as mobs respond to human emotions; markets as well as mobs can be inflamed to their own destruction.
The tax on capital gains directly affects investment decisions, the mobility and flow of risk capital from static to more dynamic situations, the ease or difficulty experienced by new ventures in obtaining capital, and thereby the strength and potential for growth of the economy.
Economic growth without social progress lets the great majority of the people remain in poverty, while a privileged few reap the benefits of rising abundance.
The failure of Lehman Brothers demonstrated that liquidity provision by the Federal Reserve would not be sufficient to stop the crisis; substantial fiscal resources were necessary.
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