Arnold Kling  

The One-Party State

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Russ Roberts writes,

I don't get it. Why is $4 million of taxpayer money going to a mall so that Costco will come to Wheaton?

In a one-party state, businesses that are friendly to the party receive subsidies, and businesses that are hostile to the party face regulation. That in turn destroys the incentive to oppose the party.

The Obama Administration would like to operate this way. On health care, they have used waivers and threats to reward friends and punish enemies. Those tactics are not quite as effective if there is a viable opposition party. After November of 2008, I did not think that a viable opposition party existed. I still would not count on it.

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CATEGORIES: Political Economy

COMMENTS (4 to date)
Jaap writes:

If you have a two-party state, but big business contributes roughly the same to each party, it is probably run the same as your dystopia.

R Richard Schweitzer writes:

Study the composition of the electorate; examine the effects of the "dominant minority" therein.

Daublin writes:

Jaap, in a two-party state, businesses can reply to a party mistreating them by appealing to the other one. They can lower funding to the bad party and raise it to the good party.

It's not perfect. From the perspective of the party leader, they have a sort of budget of corporate good will to work with. They can "spend" away that good will on projects they favor, to the extent they are ahead in the polls.

It's an interesting viewpoint that explains a lot about American politics. Vastly more than any model where the general public is expected to understand, say, economic systems.

Dan writes:

Arnold, thank you for covering this issue. I was shocked to learn how Montgomery County operates. For an update on the Westfield/Costco situation, pls visit

["MontCo" spelled out in full as "Montgomery County" above.--Econlib Ed.]

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