Are We Pro-Business?

The Wall Street Journal and others have properly excoriated the Obama administration for their extreme anti-business bias, which accrues to Obama's intellectual upbringing in the leftist halls of academe. But are those in the Tea Party therefor pro-business? This is certainly a meme on the left. Or at least they believe that Tea Party activists, like the religious right are used by the business wing of the Republican party for their own ends. See Thomas Frank, What's Wrong with Kansas.

However, our position is pro-market, which is distinct from pro-business. The problems with businesses colluding and using government to further their own ends have been known since the birth of the study of economics. Adam Smith himself is widely quoted as saying:

“People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”

In fact, we see business interests arrayed against the public good in any number of ways. Look at how many pharmaceutical companies and insurers, at least initially, supported Obamacare when it looked like they had something to gain from it. The Tea Party platform, to the extent that one exists, opposes all manner of government support of business, especially at the expense of the public. Crony capitalism is as corrupting in America as it is in Latin America.

The left sees Big Government allied to Big Labor as the sole counterweight to a tyranny of Big Business. They assume that our opposition is because of a love of big business, it is not. We believe that competition and markets and the rule of law tame business far better than government. In addition to the practical problems of substituting the wisdom of bureaucracies for the wisdom of markets, the regulatory regime is subject to capture. We end up worse off than we started, because there is an assumption that we are being protected by regulation, even among the regulated, so correct precautions are overlooked.

Bottom line, free markets are our best defense against the rapaciousness of big business. The trick is to prevent big business from capturing government and skewing the rules in its favor.