Covid Lockdowns Have Created a Crisis of Crony Capitalism

SEATTLE, WA - JUNE 18: Amazon.com founder and CEO Jeff Bezos presents the company's first smartphone, the Fire Phone, on June 18, 2014 in Seattle, Washington. The much-anticipated device is available for pre-order today and is available exclusively with AT&T service.
David Ryder/Getty Images

Following eight long months of heartbreak, panic, and despair stemming from the Covid crisis, government has once again worsened an already-terrible situation.

It’s not difficult to see how the government’s reaction to the pandemic has accelerated our path towards America’s economic ruin. Since the lockdowns began in March, roughly 163,000 businesses have closed their doors with the intention of doing so temporarily. Of these, nearly 100,000 have been forced to close permanently. Other estimates suggest that, by the time the pandemic is over, as many as 60% of all COVID-related business closings will be permanent, with 130 million people worldwide expected to starve due to government lockdowns.

Despite this tremendous loss of wealth and productivity, an extremely fortunate few have thrived in ways that would have been impossible without the government-mandated Covid lockdowns.

Standing head-and-shoulders above the tempestuous sea of economic uncertainty is multinational tech giant Amazon. Following a 26% surge in sales throughout the first fiscal quarter of 2020, Amazon CEO Jeff Bezos captured the attention of the globe by declaring, “If you’re a shareowner in Amazon, you may want to take a seat, because we’re not thinking small.” At the end of the second quarter, the company posted record earnings. One quarter later, Amazon saw its profits jump again by an additional 37% to $96.1 billion (compared with $70 billion at the same point in 2019).

But Amazon is not the only major company thriving amidst the chaos. In August, Walmart announced that it had enjoyed its highest earnings in 31 years, with e-commerce sales up 97% in one quarter. Apple is also posting double-digit levels of growth, with third-quarter revenue at $59.7 billion — 11% higher than in 2019. Apple is in the midst of our most prolific product introduction period ever,” boasted Apple CEO Tim Cook last month. “From remote learning to the home office, Apple products have been a window to the world for users as the pandemic continues…”

The picture could hardly be clearer: As Americans are forced to isolate in their homes, endure poverty rates now rivaling the Great Recession, and watch their locally owned businesses crumble, ultra-wealthy corporations capable of large-scale home delivery are eagerly positioning themselves as the only resource for essential household and teleworking needs. Such a bleak state of affairs could not reflect the vision of free-market capitalism any less; the state picking winners and losers is the very definition of crony capitalism. Corporations should have all the freedom in the world to make profits, but not as a result of the government shutting down the competition.

Like most government actions, Covid lockdowns have produced the exact opposite of their intended effect, stacking the cards against the hardworking small business owners who make this country great. The time is long past due to fight back against this tyrannical attempt to redefine the proper role of government. We either believe in liberty in times of crisis, or we do not believe in liberty at all. 

Cliff Maloney is the president of Young Americans for Liberty.

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