Tuesday, September 23, 2008

Welfare State or Corporate State?

It's a grave mistake to portray the economic problems as consequences of the welfare state, as traditionally defined. Rather, this is a failure of the corporate state, or state capitalism. Not only is this the truth, it also knocks the state socialists off balance. Let the conservatives argue that the failing system was designed to help low-income people. We know better: it was designed to politically funnel money to bankers, home builders, and the real-estate profession. As usual, low-income people were mere pawns in a special-interest scheme to shift risk from big business to the taxpayers.

Cross-posted at Liberty & Power.

3 comments:

Anonymous said...

And now we are going to funnel more money to the same criminals who brought this mess about, except this time it is coming directly from government coffers.

Hmmm, corporate state, eh? Ever read "It Can't Happen Here" by SInclair Lewis, anyone?

Bob Murphy said...

Good point Sheldon. Up till now I hadn't really considered the ulterior financial motive behind all the advantages given to low-income home buyers.

Sheldon Richman said...

Rick, that is a great book!

Bob, yes, it is a decades-long prop for several interrelated industries. We have bee scammed -- again.