A History of Cronyism in America
Cronyism: Liberty versus Power in Early America, 1607–1849
by Patrick Newman
Mises Institute, 2021, 362 pp.
Patrick Newman dedicates Cronyism to Murray Rothbard, and it is a fitting choice, as this outstanding book continues and extends Rothbard’s brilliant interpretation of American history. Newman is eminently qualified to do so, having edited both the fifth volume of Rothbard’s Conceived in Liberty and his The Progressive Era.
Like Rothbard also, he tells us exactly the principles he uses in setting forward his account of events. One of these is that “history is a clash between the forces of liberty, or those in favor of individual-decision-making and the market allocating resources, and the proponents of power, the factions that support coercion and government organization of production” (p. 14). This view leads him to the book’s main subject, the “history of cronyism: when the government passes policies to benefit special-interest politicians, bureaucrats, businesses, and other groups at the expense of the general public” (p. 13).
Newman’s second thesis is that “those who control the government’s power are corrupted over time … I define corruption as the willingness of government officials to push for interventions that benefit themselves and other favored interests … Lord Acton’s famous quote can be modified accordingly; ’Power tends to incentivize cronyism and absolute power incentivizes cronyism absolutely’” (p. 14). This tendency makes libertarian reform difficult, though not impossible: to dislodge an interventionist state, the reformers must take power, but doing so tempts them to cronyism.
I wonder whether Newman has put too much pressure on his second thesis. Lord Acton said that power tends to corrupt, and Newman retains this phrasing in his modification of Acton’s dictum, but throughout the book, he takes it to be inevitable that power does lead to cronyism. Need this be so? But whether power must lead to cronyism, it often did, and this Newman abundantly shows. In what follows, I’ll mention only a few of the many topics the author discusses.
In his accoun
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