The government should decide which business is going to be "the winner" in any capitalistic system. So, from my standpoint:
- The Small Business Administration should, at a minimum, stop giving small business loans, because they are choosing which "small businesses" they deem to have a plan for success vs failure.
- All farm subsidies should be stopped. If a farmer can't survive without the government deciding farm businesses are "winners," then let them sell out to a bigger farmer, form a co-op, or sell the land to a developer who will do something else with the farm land.
- Politicians should stop, immediately, placing loop holes into the tax structure to favor a single business or a class of business. If that's not picking winners, what is?
- Privatize the patent and copyright protection system. Since the government is involved, it's picking winners and losers in both areas.
The few items above are what comes to mind right now. Is this a liberal idea? Is it a conservative idea? Is it a libertarian idea? Or is it Constitutionally based?
I take exception with items (2) & (4). Accepting
your assertion(s) at face value, it looks as if you're not very familiar with the charters or programs of various Federal agencies.
The SBA doesn't actually make loans. It provides guarantees on portions of loans made by banks to small businesses with good credit, a reasonable amount of equity/liquid, and solid financials. In theory and practice, the SBA embodies a liberal principle for their programs function to counter the reluctance (or, failure) of the private market to lend money and they're open to all. Furthermore, the loans in themselves in no way ensure a small firm's success. It's for these and other reasons why the SBA isn't an example of gov't, "... picking winners".
Similarly, there are times when subsidies to a given industry, or individual businesses are both appropriate and warranted, e.g.; in the event of an extraordinary market failure. Where you and I might find agreement is there shouldn't be permanent individual subsidies.
I don't think privatizing the protection of intellectual property is remotely possible or would be the least bit practical. Protecting intellectual property via patents, trademarks, etc., is (again) central to civil liberties in theory and practice -- a liberal principle.
Posted by: MIB | September 19, 2011 at 01:17 AM
OK, the government should back the small business loans, either.
Posted by: DarkStar | September 20, 2011 at 07:32 PM
What do you suggest as alternatives for addressing the market's failure to lend to creditworthy entrepreneurs?
Posted by: MIB | September 21, 2011 at 09:59 PM
What do you suggest as alternatives for addressing the market's failure to lend to creditworthy entrepreneurs?
People and small groups who are willing to do micro-loans and family. Otherwise, they need to go into personal debt to get things going.
Posted by: DarkStar | September 22, 2011 at 09:40 PM
"People and small groups who are willing to do micro-loans and family."
Ummmm... that type of activity isn't taking place on a scale large enough to have an impact, which partially accounts for the market's failure.
SMH.
Posted by: MIB | September 23, 2011 at 12:10 PM