Home
/
RELIGION & LIBERTY ONLINE
/
Think Tanks Taking a Stand Against Crony Capitalism
Think Tanks Taking a Stand Against Crony Capitalism
Jun 4, 2025 2:04 PM

Alejandro Chafuen, president and chief executive officer of Atlas Economic Research Foundation and board member of the Acton Institute, recently wrote a piece for about crony capitalism.

Chafuen used to spend his summers in Argentina, so he begins his article with a story about a friend from Argentina. Enrique Piana, known to his friends as “Quique,” was heir to “Argentina’s oldest and most respected trophy and panies.”

During part of the ’90s, the government of President Carlos Menem, and then-Minister Domingo Cavallo, had a policy for the importation of gold and exports of gold fabrications that amounted to a major subsidy for exporters. Attracted by the incentives, Quique, who had e CEO of pany, became a key player in a scheme whereby exporting overvalued gold-plated products netted them 30 million in subsidies for fake transactions. As it seems that none of the medals were sold at artificial value to true customers, the only victims here ended up being the Argentine tax-payers.

The scheme involved a “business” in the United States. As there is still substantial respect for rule of law in the United States, Quique was indicted, captured, and—after some months in a U.S. jail—extradited to Argentina. In his book, he lists the government officials who he claims knew about the scheme and who received bribes for his fraudulent activities. I will not mention them here. None of them were sentenced to jail.

If it would not be for the fraud in the value of the medals, the entire scheme would be just a case of crony capitalism. Receiving legal export subsidies (or export reimbursements as they are called in Argentina) is not a crime. No one would have ended up in jail. Quique was greedy. By overvaluing medals and overstating the gold content, he would help maximize his profits—but Quique lost his freedom for a while, and his century-old pany is gone forever.

Situations like this occur all the time all over the world and this cronyism gives a bad name to capitalism. Chafuen points out that capitalism is ” the private ownership of the means of production” and that “[m]aking a moral case for capitalism obliges us to distinguish between “good and bad” capitalism.” He goes on to say that:

Think tanks from all over the world that favor free-enterprise are trying to counter the flood of news about private players who use government and corruption to increase their profits. Through books, videos, and conferences, they are trying to portray the good side of capitalism. (I leave for another article a plete list of groups engaged in this task.) In the United States, a short list of think tanks investing more of their budget on the moral defense of capitalism or free-enterprise should include the American Enterprise Institute and its Values and Capitalism program, the Acton Institute, The Center for Vision and Values at Grove City College, the Ethics and Public Policy Center, and several organizations which are inspired by Ayn Rand’s writings. Talented entrepreneurs such as John Mackey, author of “Passion and Purpose: the Power of Conscious Capitalism” and Steve Forbes, in his “How Capitalism will Save Us” have also entered the debate. The Centre for Independent Studies in Australia, CEDICE in Venezuela, and PAFERE in Poland, are active in other parts of the world. The battle against this privileged form of capitalism is also taking place in social media, with AgainstCronyCapitalism.org and a special Crony Capitalism Facebook site gradually growing in presence.

As the true story I told about Quique shows, there is a fine line between corruption and crony capitalism. Several think tanks are active in exposing corruption, but they have learned that mentioning culprits can lead to more headaches or worse. The Adriatic Institute in Croatia, has been waging a David-versus-Goliath battle and has received multiple threats. Those who have exposed crony capitalism and corruption in Venezuela are currently being sued in the United States for defamation. The billions earned by cronies can buy lawyer power from the left, center, and worse, from leading rightwing legal counsel. Most free-market think tanks therefore prefer to speak about the generalities of corruption and crony capitalism rather than mention the guilty parties. This is seldom effective. I confess that in this column, I am guilty of the same prudence.

Considerable credit should be given to Transparency International for having created the most important effort to measure the perception of corruption, which has been a helpful tool bat corruption. Having measurements to assess the magnitude of a problem, like monetary inflation, or huge deficits, helps think tanks confront the problem. To win the moral debate about free-enterprise, it would help to develop prehensive index of crony capitalism. There is a need to develop measurements about what percentage of profits in the United States and the world e from exchanges which result from favoritism, contracts between panies, corporate welfare (which the Cato Institute measures for the United States), corruption, and “sanitized corruption”—or getting legal favors, cheap loans, and foreign currency at preferential rates. This won’t be easy, but it’s not impossible.

Read “How Did He Get So Rich? Think Tanks Vs. Crony Capitalism” here.

Comments
Welcome to mreligion comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
RELIGION & LIBERTY ONLINE
Verse of the Day
  1 John 4:19 In-Context   17 This is how love is made complete among us so that we will have confidence on the day of judgment: In this world we are like Jesus.   18 There is no fear in love. But perfect love drives out fear, because fear has to do with punishment. The one who fears is not made perfect...
Verse of the Day
  Commentary on Today's Verse   Commentary on James 5:12-18   (Read James 5:12-18)   The sin of swearing is condemned; but how many make light of common profane swearing! Such swearing expressly throws contempt upon God's name and authority. This sin brings neither gain, nor pleasure, nor reputation, but is showing enmity to God without occasion and without advantage It shows a man...
Verse of the Day
  Commentary on Today's Verse   Commentary on Ecclesiastes 5:9-17   (Read Ecclesiastes 5:9-17)   The goodness of Providence is more equally distributed than appears to a careless observer. The king needs the common things of life, and the poor share them; they relish their morsel better than he does his luxuries. There are bodily desires which silver itself will not satisfy, much less...
Verse of the Day
  Ephesians 6:14-16 In-Context   12 For our struggle is not against flesh and blood, but against the rulers, against the authorities, against the powers of this dark world and against the spiritual forces of evil in the heavenly realms.   13 Therefore put on the full armor of God, so that when the day of evil comes, you may be able to...
Verse of the Day
  Romans 8:28 In-Context   26 In the same way, the Spirit helps us in our weakness. We do not know what we ought to pray for, but the Spirit himself intercedes for us through wordless groans.   27 And he who searches our hearts knows the mind of the Spirit, because the Spirit intercedes for God's people in accordance with the will...
Verse of the Day
  Commentary on Today's Verse   Commentary on Titus 2:1-8   (Read Titus 2:1-8)   Old disciples of Christ must behave in every thing agreeably to the Christian doctrine. That the aged men be sober; not thinking that the decays of nature will justify any excess; but seeking comfort from nearer communion with God, not from any undue indulgence. Faith works by, and must...
Verse of the Day
  2 Corinthians 6:14 In-Context   12 We are not withholding our affection from you, but you are withholding yours from us.   13 As a fair exchange-I speak as to my children-open wide your hearts also.   14 Do not be yoked together with unbelievers. For what do righteousness and wickedness have in common? Or what fellowship can light have with darkness?   15...
Verse of the Day
  Commentary on Today's Verse   Commentary on 1 John 4:7-13   (Read 1 John 4:7-13)   The Spirit of God is the Spirit of love. He that does not love the image of God in his people, has no saving knowledge of God. For it is God's nature to be kind, and to give happiness. The law of God is love; and all...
Verse of the Day
  John 1:32-34 In-Context   30 This is the one I meant when I said, 'A man who comes after me has surpassed me because he was before me.'   31 I myself did not know him, but the reason I came baptizing with water was that he might be revealed to Israel.   32 Then John gave this testimony: I saw the Spirit...
Verse of the Day
  Romans 16:17-18 In-Context   15 Greet Philologus, Julia, Nereus and his sister, and Olympas and all the Lord's people who are with them.   16 Greet one another with a holy kiss. All the churches of Christ send greetings.   17 I urge you, brothers and sisters, to watch out for those who cause divisions and put obstacles in your way that are...
Related Classification
Copyright 2023-2025 - www.mreligion.com All Rights Reserved