The Death of Economic Liberty and the Birth of Crony Capitalism | Trevor Burrus | Cato Institute: Commentary

The Death of Economic Liberty and the Birth of Crony Capitalism | Trevor Burrus | Cato Institute: Commentary: "Hein Hettinga is a Dutch-born immigrant who, by bottling milk from his own cows, was able to work outside the antiquated, industry-backed system of milk regulation. This "loophole" allowed him to charge 20 cents less per gallon than his competition. Unfortunately for him, his competition was "big dairy," and they didn't appreciate being undercut in price. According to an economist for the Dairy Farmers of America, Hettinga's cheaper milk was "damaging to the marketplace," even though the existing regulatory system raises costs to American consumers by nearly $1.5 billion per year.

Big dairy eliminated their competitor by lobbying Washington, D.C. lawmakers to close the "loophole" that was being "exploited" by Mr. Hettinga. Senators John Kyl (R-Ariz.) and Harry Reid (D-Nev.) compromised on a deal that would exempt milk producers in Nevada from the regulatory framework and make Mr. Hettinga pay dues into the price-controlled pool, effectively subsidizing his competitors."

"America's cowboy capitalism was long ago disarmed by a democratic process increasingly dominated by powerful groups with economic interests antithetical to competitors and consumers. And the courts, from which the victims of burdensome regulation sought protection, have been negotiating the terms of surrender since the 1930s."

"large, unionized bakeshops were hoping to hamstring their smaller, often family-run competitors whose employees worked longer hours in order to compete against larger, mechanized bakeshops. Lochner even has undertones of xenophobia, as the smaller competitors were often run by recent immigrants."