Crony Capitalism
Seven out of the 10 richest counties in the U.S. are in the suburbs of Washington, D.C., which produces little except rules and regulations. Even worse, the slow growth and decreased social mobility of the last decade have damaged the free market’s reputation as a creator of prosperity. The hundreds of millions of dollars awarded for disastrous economic performance — from Robert Rubin’s salary as chairman of almost-bankrupt Citigroup to government loans for the actually bankrupt solar company Solyndra — have in turn weakened public belief in the system’s fairness.
Luigi Zinglaes’ editorial in the WSJ.
The author is definitely right about Italy. The young people there no longer have any incentive to work or study, because it’s all meaningless for them in the face of nepotism and often times outright bribery.
We look at Italy and Greece and assume it cannot happen here. But, we are the new Greece and Italy by mid-century. Remember Athens and Rome were once among the most powerful city-states in the Western World.
No doubt about it, Americans have lost faith in the fairness of the system here.
And Studebaker, if we do go the way of Athens and Rome, can anyone replace what we were to the global economy? Certainly, China will have its own problems…