Monday, August 13, 2012

Crony Capitalism - Alive & Well in Texas!

Every time I mention Reagan, I get quite a bit of backlash, please don't miss the forest for the trees...
In Texas we have a large number of crony capitalist and corporate conservatives serving as elected officials. In their campaign speeches, they claim to hang on traditional conservative values, such as property rights and local control. However, their actions tend to be quite different, and they back peddle pretty quick when they are exposed for what they really are. In Texas, pretty much anyone who has more money than you, can do what they wish to your property, or just take it altogether if they want it.
In Texas, the crony capitalists are allowed to live a life of luxury that far exceeds their talents or mental abilities. Although, they require some intelligence to see these crony capitalist opportunities, their talents certainly would not elevate them to the status that they have found themselves in by taking the crony capitalist shortcut. Take our governor for example, he is college educated and was an officer in the Air Force, and although he made a fool of himself on the national stage, through my interactions with him, I would not consider him dumb. He does however appear to be the epitome of the sleazy politician and crony capitalist. Furthermore, he is a career politician that has never been successful at anything else. This was sniffed out pretty quickly on the national scene, and he was sent back to apathetic voters of Texas with his tail between his legs. He would certainly never have made to the level he has on brains alone, so he is afforded a life of power and luxury due to being a crony capitalist here in Texas.
Another prime example of the crony capitalist, is Texas State Representative Dennis Bonnen. Mr. Bonnen was an insurance agent prior to realizing the crony capitalist game. Although being an insurance agent is a respectable field, this was not good enough for Bonnen. Him and a number of other crony capitalists have purchased a bank in Pearland, TX. Mr. Bonnen has put other current and former elected officials on the board of directors for this bank. Another member of the board is a licensed lobbyist in the state of Texas, so once again this line between government and industry gets blurred. Bonnen's bank will succeed, not because of his business savvy, but rather by the backs he scratches while serving in the legislature. Mr. Bonnen, has a history of skirting the law, and has a couple of ethics violations here in Texas, but has never faced legitimate opposition for his seat.
Traveling around the United States, it is clear that Texas does not own the market on the crony capitalists. Several other states have elevated the one sold to the highest bidder to positions of leadership within their perspective states. They use the cash from their new found friends to portray an image of the second coming of Ronald Reagan. However, it is doubtful that most of these corporate conservatives have ever even read Reagan's book, much less model their political philosophy after him. To put it bluntly, they wouldn't amount to a pimple on Reagan's…well you know. However, that does not stop them from hanging the picture of Reagan in their offices, and portraying themselves as Reagan capitalists.
Why do I bring these stories up in this manner? We because for the most part, the legislation and regulations written by these individuals, clearly go against the principals of conservatism. Their actions tell a much different story than their campaign speeches. Whether it be Texas, Pennsylvania, Ohio, North Carolina, or Michigan, they pass legislation that destroys private property rights, takes away local control, and undermines the free market system.
One example is the rule 37 exceptions that has become the norm in Texas. This allows a private company to take a person's private mineral property without compensation. With the frequency of this use, there have been close to 5,000 natural gas well permits issued in the Barnett Shale with rule 37 exceptions. This could amount to a billion dollars in private property transferred to a corporation without compensation. So much for that free market I keep hearing about.
There are other mechanisms used to accomplish the same thing called compulsory integration or forced pooling, which forces someone to sell their minerals to a company against their will, something like eminent domain. In these cases the mineral owner is typically paid something for their minerals. The minimum payment s and terms vary by state, some are better than others, but all are typically against the will of the mineral owners. For the most part, these crony capitalist do not even understand the problem with allowing a for profit company to take private property. They believe that as long as you get a "fair price" for your land then it is ok, completely missing that the taking is against the will of the property owner. There is no such as fair and equitable negotiations when a company has the power of eminent domain, even if you call this power something else. The citizen always loses in these situations, the corporation always wins.
Visiting the beautiful state of North Carolina, I found that their "conservative" State Senate and House passed a draconian forced pooling act. This bill essentially gave the industry the ability to take mineral interests at will, and goes as far as to set the minimum royalty that must be paid, which is about half of the going rate in other areas. Therefore, those who live in gas producing areas of North Carolina, your state government has decided that you no longer have any say so in what happens to your property. If you don't believe me, just wait and see. I hate to bring you the bad news, the confiscation of private property is not a founding principle of conservatism.
Another issue that continues to pop up around the country is the removal of local control in regards to the oil and gas industry. The State of Texas has made several attempts to take away local control, while many other states have succeeded. I served as a local official for six years, and feel that there is not a purer form of democracy than a small town government. I also have a particular passion about maintaining local control of things that greatly affect the future of small communities. Local officials who are visionaries trying to develop a comprehensive plan for these communities have their hands tied by overreaching and overbearing state governments.
Currently the "conservative" government in Pennsylvania has passed legislation that removes local control over gas drilling in the Marcellus Shale. If they were successful in implementing this legislation, this would cripple local communities, and prevent them from being able to effectively plan for their future. Oddly enough, the same politicians that have aggressively sought to take the decision-making away from local officials, are the same ones who complain about an over reaching federal government. It would appear that these state officials are looking to have all of the control and power reside solely with them. Perhaps, they prefer to keep all of those campaign contributions to themselves.
Fortunately, the courts has overturned parts of this legislation for being unconstitutional. However, that has to say something when your state government attempts to pass legislation that is unconstitutional, it really shows where their heart is at, and it is not with the citizens of Pennsylvania. Again, I will let you in on a little secret, overbearing, unconstitutional governments that take away local control, are not a principle of conservatism.
The oil and gas industry itself is the epitome of crony capitalism. They receive billions in corporate welfare every year, and billions more in tax breaks and exemptions, and that is only at the federal level. They are given as much or more at the state level. So the taxpayers are paying this industry's bills already, and they would likely not survive otherwise. Also, they are exempt from most every environmental law that could apply to them, so they virtually have no rules to follow. Furthermore, there is no one watching to make they follow the few that do apply. Therefore, they do not have to follow the same rules that similar industries have to follow. For their troubles, the oil and gas politicians receive hundreds of millions of dollars in campaign contributions every year. However, this industry does nothing but trample on the Constitution, and private property rights of those in their path, not sure how else to describe this arrangement. Wonder if that is what the founding fathers envisioned when forming this nation?
So those of you who support the crony capitalist and corporate conservatives ways mentioned above, I would ask that you first come clean with your citizens and tell them you are not the Reagan like politician that you have portrayed yourself to be, nor are you even a real conservative. You do not support the constitution, or the citizens who voted you into office. The next item that would be in order, is to go ahead and take down that picture of Reagan on the wall in your office, and install a photo of someone more appropriate of your true values. If you are having difficulty finding that perfect photo, give me a call, I just might have some suggestions for you. Oh, and you also will need to go ahead and turn in your conservative card, because you know that is not what you are, so it is probably time to give it up. The taking of property rights and an all powerful, over bearing, centralized state government are not founding principles of conservatism or capitalism, but rather they are founding principles of communism, and that was what Reagan spent his life fighting.   
Calvin Tillman
Former Mayor, DISH, TX
(940) 453-3640

"Those who say it can not be done, should get out of the way of those that are doing it"

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