The term fascism is overused, but it has relevance in today’s society when it comes to the economic aspect of things.  Economic fascism means that the government (i.e., the state) controls businesses without actually owning them.  Socialism is the state ownership of the means of production.

A lot of what the so-called democratic socialists (such as Bernie Sanders) advocate is not outright socialism.  It is more economic fascism than socialism.  They don’t necessarily want the government to own everything.  They want a bigger welfare state, and they want government to have even more control over business.

I recently wrote about targeted tax cuts and cronyism.  Some libertarians take the position that a tax cut is good no matter what, even if it involves favoritism.  They believe that any reduction of taxes, including special exemptions for favored corporations, is positive.

I don’t fully agree with this position.  I think a libertarian’s position should be more nuanced.  The universal position for a libertarian should be tax rate reductions and spending reductions across the board.  When it comes to targeted tax cuts and tax exemptions, it really does depend on the situation.

If there is a tax cut for people only named Hillary Clinton, I will oppose it.

And what about retroactive tax cuts?  Elizabeth Warren just said that there should be reparations (tax rebates) for same-sex married couples who previously paid a higher tax because they couldn’t file as a married couple.  Do the “tax-cuts under any circumstance libertarians” support this, since it is really just a tax refund?

Should they support the bailout of GM and Chrysler in 2008/ 2009 if we just call it a tax refund for previous years?

This is why our position should really be nuanced, and there may not always be a clear-cut answer. This week, this position was confirmed for me in seeing what happened with Nike in Arizona.

The State Sells Sneakers

Nike was going to sell sneakers with an old design of the American flag.  Colin Kaepernick protested the move because America had slavery at that time, and we should not celebrate this symbol according to him. Nike capitulated and withdrew the sneakers from the market.

Then, Nike takes a hit from the other end.  The governor of Arizona, Doug Ducey, declares that he is revoking tax incentives for Nike to set up business in Arizona because Nike is not selling that particular shoe.

So now we have a situation where the governor of Arizona is dictating to a private company what products they should sell (or else face higher taxes).  This is cronyism in reverse.  It is economic fascism.

When Kaepernick protested, Nike could have gone ahead with selling the shoes anyway.  The risk is that they faced backlash (lower sales) from those taking Kaepernick’s side.  I am not judging Nike one way or another for its decision. The executives probably just didn’t want the controversy, but they got it anyway.

If Arizona hadn’t been playing favorites in the first place with special tax breaks, then this threat from the governor wouldn’t have happened.  It would have been difficult for the Arizona governor to just say he was raising taxes on Nike above and beyond every other corporation.

It is my understanding that the tax incentives for Nike were a combination of tax breaks and outright corporate welfare.  Of course, the corporate welfare should be revoked and never should have been there in the first place.

It is curious why these state and local governments offer incentives to large corporations to set up business in their jurisdiction.  They want to be able to say they created 1,500 jobs, or whatever the number is.  They could offer the same incentives to 100 companies that add up to the same size and get the same result, but that is harder to do, politically speaking.

I don’t feel bad for Nike here.  When you take the government (taxpayer) money, then you take the government commands.

This is a good example of one reason why libertarians should oppose school vouchers (aside from the fact that it is still theft).  When a “private” school accepts government money, they accept all of the dictates that go along with that money.  They are now under the control of the state, and it is hard to complain when receiving taxpayer money.  They can eventually be told what to teach and what not to teach.

I am sympathetic to the sentiment of libertarians cheering for tax loopholes, but look at what it got us in Arizona.  Nike tried to take something like a tax loophole, and they ended up being told what shoes they should sell.  It is hard to cheer for economic fascism.