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Republicans say they favor free markets. They’re not like those pinko-commie Democrats, who prefer “picking winners and losers.”

Oh, come off it already.

Catherine Rampell mug

Catherine Rampell

Republicans love picking winners and losers, too. They just choose different winners and different losers than Democrats do. In the case of today’s Republican officials, the winners are mostly donors, incumbents, culture-war favorites and cheats.

On Thursday, the White House announced yet more tariffs, this time on steel and aluminum imports. Predictably, this protectionist measure pushed stock prices for beneficiaries like U.S. Steel and Century Aluminum way up. It also pushed stock prices for other industrial companies such as Caterpillar and Boeing — which will now face higher prices for raw materials, as well as the threat of retaliatory tariffs abroad — way down.

This White House announcement follows an earlier round of tariffs on solar panels and washing machines. Those, too, are likely to lead to higher prices for consumers, and have already caused at least one U.S. company that imports solar panels to announce layoffs.

President Trump has undertaken other measures to subsidize specific industries he has a soft spot for, especially coal. At one point his own appointees stepped in to block a set of subsidies to coal power plants that had been proposed by Energy Secretary Rick Perry.

There are other energy-related regulatory carve-outs for friends and family, such as the offshore drilling plan that shields Florida beaches (at the behest of Republican Gov. Rick Scott) but not those in deep-blue California.

And before you start arguing that these market interventions are all Trump-specific, consider what happened in Georgia this week.

Republican officials there vowed to punish Delta Air Lines, one of the state’s largest employers, for canceling discounted prices for National Rifle Association members.

Lt. Gov. Casey Cagle, who is running for governor, gave Delta an ultimatum: restore the NRA discount, or forget the $50 million sales-tax exemption on jet fuel that Republican lawmakers had been considering. In other words, restore our special discount, or we won’t give you your own special discount. Delta didn’t budge, so lawmakers axed the tax break Thursday afternoon.

It takes a funny formulation of free markets to punish a private company for not giving your favored political group a good price.

Don’t get me wrong. These kinds of state-level arbitrary tax carve-outs — often intended to appease a particular big firm bearing lots of jobs — are often bad policy and can lead to a race to the bottom. They also distort markets, affecting the incentives for where firms invest and in what. And they favor some firms at the expense of others.

But Georgia state legislators didn’t kill the jet-fuel tax break because they fear distorting markets, or because they don’t want to choose winners and losers. The debate in Georgia was instead over whether Delta should be a winner, or whether it should be a loser.

That’s sort of the problem.

GOP officials nationwide keep proving that when they say they’re “pro-business,” what they really mean is that they’re pro-certain businesses and anti-others.

Trump and the Republican-led Congress have taken deliberate measures to put their thumb on the scale in favor of firms that deceive and defraud their customers. They’ve done this by kneecapping public officials who try to enforce the laws that are still on the books, and limiting the ability of consumers to fight back when they’ve been cheated.

The Education Department, for instance, is trying to block state governments from enforcing laws against student-loan servicers that mislead borrowers, according to a draft document obtained by Bloomberg and Politico.

And last year Republicans dismantled or delayed regulations curbing mandatory arbitration agreements as a condition of being a customer of financial firms, for-profit schools and nursing homes. A number of other bills that have been introduced or have already passed the House also send seemingly obscure categories of disputes, such as over forestry management, into binding arbitration.

Other efforts try to restrict consumers’ ability to seek restitution. Ironically, on the same day that Equifax announced its data breach, the House held a hearing on a bill to limit actual and statutory damages for class actions involving credit agencies to $500,000, and to eliminate punitive damages.

All these actions cap the consequences that corner-cutters and scam artists face if they get caught. Which constitutes an implicit subsidy to firms whose profits depend on cutting corners and scamming customers, and an implicit penalty upon firms that choose to obey the law.

There are lots of ways to pick favorites. Republicans are exploiting all of them.

Washington Post columnist Catherine Rampell can be reached at crampell@washpost.com.

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(1) comment

kingman10

"Don’t get me wrong. These kinds of state-level arbitrary tax carve-outs — often intended to appease a particular big firm bearing lots of jobs — are often bad policy and can lead to a race to the bottom. They also distort markets, affecting the incentives for where firms invest and in what. And they favor some firms at the expense of others." Can anyone say "foxconn". Talk about picking winners and losers, we've done alot of that in wisconsin. Drug tests for those who are hungry and need help buying groceries, no drug tests or even a guarantee from those getting billions in tax money.

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