cronyism

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For the record label, see Crony Records

Cronyism is partiality to long-standing friends, especially by appointing them to positions of authority, regardless of their qualifications. Hence, cronyism is contrary in practice and principle to meritocracy. Cronyism exists when the appointer and the beneficiary are both in social contact, often the appointer is inadequate to hold his or her own job or position of authority. For this reason, the appointer appoints people who will not try to weaken his or her own job, or express views contrary to their own views. Politically, "cronyism" is derogatorily used. The word "crony" first appeared in 18th century London, believed by some to be derived from the Greek word χρόνιος (chronios), meaning "long-term", however, crony appears in the 1811 edition of Grose's Vulgar Tongue with a decidedly non-collegiate definition, placing it firmly in the cant of the underworld.^[1] A more likely source for the words etymology is the Irish Language term Comh-Roghna (pron. ko-ronə), which translates to "close pals", or mutual friends.

Governments are particularly susceptible to accusations of cronyism, as they spend public money. Many democratic governments are encouraged to practice administrative transparency in accounting and contracting, however, there often is no clear delineation of when an appointment to government office is "cronyism". It is not unusual for a politician to surround him- or herself with highly-qualified subordinates, and to develop social, business, or political friendships leading to the appointment to office of friends, likewise in granting government contracts. In fact, the counsel of such friends is why the officeholder successfully obtained his or her powerful position — therefore, cronyism usually is easier to perceive than to demonstrate and prove.

In the private sector, cronyism exists in organizations, often termed 'the old boys club' or 'the golden circle', again the boundary between cronyism and 'networking' is difficult to delineate.

Moreover, cronyism describes relationships existing among mutual acquaintances private organizations where business, business information, and social interaction are exchanged among influential personnel. This is termed crony capitalism, and is an ethical breach of the principles of the market economy; in advanced societies, crony capitalism is a breach of market regulations, e.g. the Enron fraud is an extreme example of crony capitalism.

Given crony capitalism's nature, these dishonest business practices are frequently (yet not exclusively) found in societies with ineffective legal systems. Resultantly, there is an impetus upon the legislative branch of a government to ensure enforcement of the legal code capable of addressing and redressing private party manipulation of the economy by the involved businessmen and their government cronies.

The economic and social costs of cronyism are carried paid by society. In the form of reduced business opportunity for the majority of the population, reduced competition in the market place, inflated consumer goods prices, decreased economic performance, inefficient business investment cycles, reduced motivation in affected organizations, and the diminution of economically productive activity. A practical cost of cronyism is manifest in the bad workmanship of public and private community projects. Cronyism is self-generating, cronyism then begets a culture of cronyism. This can only be apprehended by a comprehensive, effective, and enforced legal code, and empowered government agencies who can effect prosecutions in the courts.

All appointments that are suspected of being cronyism are controversial. The appointed party may choose to either suppress disquiet or ignore it, depending upon the society's level of freedom of expression and individual personal liberty.

Some instances of cronyism are readily transparent. As to others, it is only in hindsight that the qualifications of the alleged "crony" must be evaluated.

Cronyism can exist anywhere, in both free and not-so-free states. In general, authoritarian and totalitarian regimes are more vulnerable to acts of cronyism simply because the officeholders are not accountable, and all office holders generally come from a similar background ( e.g. all members of the ruling party ). Some situations and examples include:

• George Washington was criticized for appointing Alexander Hamilton as the first U.S. Secretary of the Treasury after Hamilton had served as Washington's aide during the American Revolutionary War. Nonetheless, the contributions Hamilton made to stabilizing the currency and securing outside capital for the fledgling democracy are well known. Referring to Hamilton's appointment as cronyism seems particularly disputable in retrospect, although it is only after looking at his accomplishments that this determination can be made.

• Appointing cronies to positions can also be used to advance the agenda of the person making the appointment. And it can also spectacularly fail to do so. In medieval England, King Henry II arranged the appointment of his good friend Thomas Becket to be Archbishop of Canterbury. Henry believed that Becket would promote the king's agenda but was dismayed to see Becket adhere to his own conscience. Becket eventually excommunicated the king and the king incited three knights to murder Becket.

• Examples of cronyism can be found in a number of current and former communist states. The cultural revolution in China was initially popular due to the perception that Mao Zedong was ridding the state of a number of officials who had obtained their positions by dint of friendship with communist authorities. In Russia, President Vladimir Putin has gone after a number of former communist officials who held office through their connections to party officials.[1]

• Independent of the world of politics, the business and labor community have also seen charges of cronyism. President Theodore Roosevelt led an attack on the cronyism against the oil, steel, banking and other businesses that had conspired to set prices by maintaining virtual monopolies through cronyism. Through interlocking directorates it was not uncommon to see various corporate boards share members among each other.

• One of the most severe cases of cronyism occurred during the Kennedy administration. Robert S. McNamara was appointed by President John F. Kennedy without any experience, a point which McNamara made clear in the 2003 documentary The Fog of War. McNamara's role in the disastrous Vietnam War was crucial and he is often considered "the architect of the Vietnam War". Kennedy originally offered him a job as Secretary of Treasury and when McNamara admitted to having no experience he gave him Secretary of Defense. Even though McNamara confessed no experience in defense, Kennedy insisted he accept the position.
• Another controversial example of cronyism during the Kennedy administration was the appointment of his brother Robert F. Kennedy to the position of Attorney General.

• Most recently, US President George W. Bush was accused of cronyism after the nomination of Harriet Miers to the US Supreme Court.^[2] Miers had no previous judicial experience and demonstrated little knowledge of constitutional law, and her selection was rejected by many conservatives and liberals. The appointment of Michael D. Brown to the head of FEMA could also be considered a case of cronyism as Brown had no experience pertaining to his job.^{[3] [4]} The administration has also been accused of cronyism for reducing Scooter Libby's sentence in the Plame Affair.^[5]

• Paul Wolfowitz was mentioned^[6] in connection with cronyism after the World Bank committee charged him with violation of ethical and governance rules as bank president by showing favoritism to his companion in 2005. The report noted that Mr Wolfowitz broke bank rules and the ethical obligations in his contract, and that he tried to hide the salary and promotion package awarded to Shaha Riza, his companion and a bank employee, from top legal and ethics officials in the months after he became bank president in 2005.

See also

• Nepotism
• Meritocracy
• Oligarchy
• Crony capitalism
• Cartel
• Price fixing
• Political Sleaze (UK Politics)
• Cash for Peerages

External links

• SuperNews: Hurricane Katrina - A political flash cartoon about the cronyism surrounding Michael D. Brown and Hurricane Katrina.

References

1. ^ "Crony: An intimate companion, a camrade; also a confederate in a robbery" - Classical Dictionary of the Vulgar Tongue, 1785 [1811]. Grose
2. ^ http://www.billoreilly.com/show?action=viewTVShow&showID=1490#1
3. ^ http://www.cato.org/pub_display.php?pub_id=5109
4. ^ http://www.nationalreview.com/comment/bellow200510180826.asp
5. ^ http://news.bbc.co.uk/2/hi/americas/6266766.stm
6. ^ The Guardian - Wolfowitz under fire after partner receives promotion and pay rise

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