Free Market vs. Pro Business: The Difference and Why It Matters

BY BRIAN RUDDOCK

The terms “free market” and “pro business” tend to get jumbled together as if they are one and the same. That is especially the case during a presidential election year, particularly one that pits a titan of business against a career politician/academic. Democratically aligned campaign staffers and left-leaning columnists conflate the two terms with shocking regularity. Republicans, meanwhile, have done themselves no favor by too often falling into the same trap when crafting policy; they assume that pro business policies can all be justified as free market.

The problem, of course, is that, while not technically mutually exclusive, the terms are in practice often opposed. Consider, for example, a recent article in Tech Crunch about Google’s growth in lobbying spending. As the article notes, Google’s Q1 2012 lobbying spend was three times higher than it was in Q1 2011. The piece listed many of the areas in which Google lobbied:

“…Google’s lobbying strategy focused on SOPA, patent reform, data privacy and accountability, online advertising regulation, intellectual property and trademark issues, cyber security and online privacy, renewable energy, freedom of expression and censorship, immigration reform and the Startup Visa Act, science, technology and math education, free trade, broadband access, freedom of expression and intellectual property in international trade agreements, “openness and competition in the online services market,” cloud computing, tax reform, internet standards of service and more[.]”

Two things struck me about this passage. First, Google probably pays more attention to public policy than most politicians. Second, though by definition pro business, this list is by no definition free market!

As a brief intellectual exercise, I listed out the policy areas mentioned in the article, the likely goals of Google in those areas and then whether the areas/goals were free market or pro-state. This is by no means an exact science; I have no inside knowledge of, nor do I speak for, Google – the policy goals were determined from my understanding of digital marketing and politics. Finally, each policy area has more goals than I was able to list.

Rather than methodological perfection, however, my point was to examine the diversity of “pro business” lobbying activities even within one (albeit giant) firm. The results can be seen in the chart at the top of the page (click to enlarge).

As you can see, some of what Google is lobbying for is free market: lower taxes, self-regulation, etc. But as a technology firm, Google also lobbies for many activities that are decidedly pro-state and anti free market: increasing federal funding for education (in subject areas where Google needs more educated employees), renewable energy initiatives that would ultimately lower their server maintenance costs, and more.

Google is acting as a self-interested person would, pushing for its specific needs rather than voting on principle. This makes Google the rule rather than the exception, and it is hardly surprising. The federal government has made it abundantly clear that to succeed, you have to play ball, both to avoid crippling prosecution and to receive taxpayer money. Thus, the most innovative firm in the world spends an annualized $20.1 million on costs that have nothing to do with actually improving their products or services.

Liberals may want to pause before lambasting big business, as they increasingly seem to support the growth of government. Conservatives should make a sharp distinction between pro business and free market policies if they are to ever be taken seriously as the party of limited government. All of us, meanwhile, should recognize the very real difference between the two descriptors.

Advertisements

Author: R. Byrnes

Ryan is the founder and editor-in-chief of Yi! News.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s