Obama’s corporatism: One liberal denies it 

Barack Obama has consistently pushed Big Government programs that benefit the biggest and most well-connected companies. I have documented this in dozens of cases and hundreds of columns or blog posts, and I think it’s a pretty clear pattern, and some on the Left agree with me.

Some liberals disagree with me, though. Today, in the New Republic (you need a subscription to read the piece), Jonathan Chait takes a swipe at my argument, declaring “the corporatist critique is simply at odds with reality.”

So, let me take on his arguments  after the jump (and while Chait, oddly, provides no specifics at all, I provide plenty):

Chait writes:

The central fallacy of all the critiques of Obama’s “corporatism,” both right and left, is that they mistake negotiation for collaboration. There is a difference between businesses jostling to minimize the damage of a reform they can’t stop and businesses crafting legislation they desperately want to enact.

Yes, there is a difference, and we’ve seen the whole spectrum under Obama, with Wall Street closest to the “negotiation” end of it.

For pure collaboration, look at climate change legislation. GE, which has spent more on lobbying over the past decade than any corporation, has a business that deals in greenhouse gas credits — which are useless without carbon constraints. GE helped launch the U.S. Climate Action Partnership which put cap-and-trade on the table. GE’s CEO is on Obama’s Economic Recovery Advisory Board. GE isn’t compromising with the White House, it is collaborating.

Another fine example of pure cooperation is Google and the White House. To borrow Chait’s analogy, this arrangement more closely resembles the Hitler-Stalin pact than the Treaty of Versailles, with both sides winning and losses for those who are left out. And both parties are explicitly working together, in violation of ethics rules.

And the drug industry was hardly “jostling to minimize the damage of a reform they can’t stop” with health-care reform. The guys who were trying to stop it tell me they had won during Town Hall Summer, with all the Democrats running scared, until top drug lobbyist Billy Tauzin cut a deal with Rahm Emanuel to save a bill that otherwise would have died. The final bill ended up leaving the drug makers better than they would have been without it — subsidies, mandates, extended protection from generics — and now the drug companies are running ads in support of Harry Reid’s tough reelection.

Chait concludes “the corporatist critique is simply at odds with reality,” because “the general disposition of the business lobby has been one of opposition.” This is hard to square with the numbers:

  • The industry that has spent the most on lobbying so far under Obama is the drug industry, which pushed ObamaCare across the finish line.
  • GE — Obama’s partner in climate change, embryonic stem-cell research, high-speed trains, MSNBC — has spent more on lobbying in the Obama era than any other company.
  • PhRMA, Obama’s partner in ObamaCare, has spent more than any single-industry group under Obama.

A rare fact in Chait’s piece — and the strongest point he has — is that “The U.S. Chamber of Commerce has consistently opposed Obama’s proposals.” Indeed, the Chamber has spent much more than PhRMA or GE on lobbying, and has opposed cap-and-trade, Wall Street regulation, and ObamaCare. But on the other hand, the Chamber has sided with Obama on:

  • Bailing out Wall Street
  • Bailing out Detroit
  • The stimulus
  • Green subsidies
  • Cash-for-Clunkers

That the Chamber, an umbrella lobby representing all corners of industry, opposes Obama on regulation is almost the exception that proves the rule. Rent-seeking, corporatism, and regulatory robbery are about seeking special favors, and narrow benefit. The broader the group, the less it engages in special-interest pleading.

As long as liberal writers like Chait stick to vague generalities and comfortable paradigms, Obama gets a free pass.

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Timothy P. Carney

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