The newly-elected Hawaii government leaders and legislature may not understand the difference between Free Market Entrepreneurs and Crony Business Moguls:
Market entrepreneurs succeed by providing customers with better products, more reliable service, and lower prices than are available elsewhere. They succeed by creating wealth -- by producing goods and services that are worth more than the value of the resources required for their production.
Crony Business Moguls are different. They get ahead through subsidies, special tax breaks, regulatory favors, and other forms of political favoritism. Rather than providing consumers with better products at attractive prices, crony moguls form an alliance with politicians. They provide the politicians with contributions, other political resources, and in some cases, bribes, in exchange for subsidies and regulations that give them an advantage over other firms.
Cronyism seems to be business-as-usual in Hawaii.
Rather than create wealth, crony moguls form a coalition with political officials to plunder wealth from taxpayers and other citizens.
As the Hawaii Legislature convenes, there will be a shortage of revenue due to the historical absence of private sector development and recent loss of pork. Kicking the spending addiction and reducing taxes will not likely be the behaviors of choice. Increasing union salaries, pensions and benefits along with spending and taxing may be age-old patterns too difficult to resist. Never mind being awash in red ink, with the highest taxes in the nation, the most inadequate roads, crippling utilities and 47th lowest education performance in the 50 states, the mindless march to more ruin seems inevitable.
As the 112th U.S. Congress convenes, there will be a monumental struggle between those who are committed to limited government and open markets on the one hand and those favoring more collectivism and governmental/political control of the economy on the other.
"The outcome of this struggle will determine the future of both economic freedom and the prosperity of Americans and others throughout the world." Gwartney, Lawson and Hall. The Decline in Economic Freedom. 12-2010.
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