The Magazine

Cronies ’R’ Us

May 28, 2012, Vol. 17, No. 35 • By ANDREW FERGUSON
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The real argument against the bank isn’t fiscal. It’s true that we shouldn’t be putting more taxpayer money at risk when every part of government needs to be cut back. More important, unwinding the bank would have been an act of philosophical hygiene—cutting government not because “we can’t afford it” but because it works against the economic freedom that brings prosperity. Meddling of the sort the bank represents distorts the market over the long term, and thus reduces the space for competition and the wealth such competition creates. Regardless of any near-term benefits, which are likely oversold, the eventual consequence of the bank’s intervention is to turn businesses into rent-seekers instead of enterprises dedicated to innovation. They end up trying to please the government instead of the customer.

The bipartisan deal between Cantor and Hoyer reminds us that few concepts in Washington are more overrated than “bipartisanship.” Large ideological advances are often made when Congress votes on party lines—Democrats will think here of Obamacare, Republicans of the Bush tax cuts—but the muddy trail of mischief left by bipartisanship is a long one: the prescription drug benefit, Fannie Mae, campaign finance reform, the No Child Left Behind education reform, and an almost limitless number of pernicious expenses that Republicans and Democrats together renew automatically (federal subsidies for nearly everything).

“I say the problem is not that we don’t get along,” Coburn said last week. “We get along too well. Government is twice the size it was 10 years ago. The president can’t spend the money if we don’t appropriate it. So it’s not a presidential problem. It’s a congressional problem.”

Coburn’s right. And when we look to the promise of 2013, that’s what has us worried.

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