Study of American Capitalism

Study of American Capitalism

Created in the wake of the 2008 financial crisis, and the government’s subsequent responses, the Project for the Study of American Capitalism at The Mercatus Center is a research program responding to the increased concern about the role of political favoritism in American business. The project explores the implications of this emerging character of the economy, examining the effects it has on the standard of living in the United States and public perceptions of the legitimacy of government and business. Does it make any difference to average Americans whether ours is a more or less free market? And what can policymakers do to ensure competition and to commit in a credible way to equality of opportunity?

Drawing on hundreds of academics from around the world, the Project for the Study of American Capitalism helps scholars and policymakers investigate the nature of these problems and identify real and sustainable solutions.


Veronique de Rugy, Diane Katz | Apr 15, 2015
Ex-Im Bank advocates emphasize its importance to small businesses and economic growth. A new analysis of government data reveals that Ex-Im Bank’s top 10 overseas buyers are large corporations that primarily purchase exports from multinational conglomerates. Ex-Im Bank’s small business narrative is challenged by the fact that the buyers receiving the most subsidies are—like the exporters—major corporations.
Jayson L. Lusk | Apr 08, 2015
In a new study based on empirical research for the Mercatus Center at George Mason University, agricultural economist Jayson L. Lusk concludes that the reduction or elimination of subsidized crop insurance, SNAP, and ethanol production mandates would reduce food prices for many consumers, benefit food producers who are not heavily subsidized by the government, and provide an overall economic benefit to taxpayers across the United States by potentially decreasing taxes.
Christopher Koopman, Thomas Stratmann, Mohamad Elbarasse | Mar 31, 2015
Thirty-six states and the District of Columbia currently limit entry or expansion of health care facilities through certificate-of-need (CON) programs. These programs prohibit health care providers from entering new markets or making changes to their existing capacity without first gaining the approval of state regulators. Since 1979, Georgia has been among the states that restrict the supply of health care in this way, with 17 devices and services—including acute hospital beds, positron emission tomography (PET) scanners, and open heart surgery—requiring a certificate of need from the state before the device may be purchased or the service offered.
Christopher Koopman, Thomas Stratmann | Mar 24, 2015
Thirty-six states and the District of Columbia currently limit entry or expansion of health care facilities through certificate-of-need (CON) programs. These programs prohibit health care providers from entering new markets or making changes to their existing capacity without first gaining the approval of state regulators.
Timothy Sandefur | Mar 24, 2015
In an article to be published in the Harvard Journal of Law & Public Policy in conjunction with the Mercatus Center at George Mason University, legal scholar Timothy Sandefur explores the history, theory, and operation of CPCN laws, also known as “Competitor Veto” laws, focusing on evidence uncovered as part of litigation challenging such laws in Missouri and Kentucky. The article concludes that because these laws are designed to protect incumbent businesses, there must be reforms on the federal level to abolish them. Several possible reforms are considered, along with objections.
Christopher Koopman, Thomas Stratmann | Mar 03, 2015
While CON programs were intended to limit the supply of health care services within a state, proponents claim that the limits were necessary to either control costs or increase the amount of charity care being provided. However, 40 years of evidence demonstrate that these programs do not achieve their intended outcomes but rather decrease the supply and availability of health care services by limiting entry and competition. For policymakers in Florida, this situation presents an opportunity to reverse course and open the market for greater entry, more competition, and ultimately more options for those seeking care.

Testimony & Comments

Veronique de Rugy | Mar 24, 2015
Policymakers who are interested in supporting the entrepreneurs and companies that will deliver the next generation of energy supplies and products should focus their attention on correcting the federal government’s hostile tax climate and dispense with the futile hopes of outsmarting the marketplace.
Veronique de Rugy | Jun 25, 2014
The Bank has long outlived its purpose and cannot manage to meet the standards of the new missions that have been developed to validate its existence. For policymakers who have the facts, the choice is clear: the Export-Import Bank must go.
Veronique de Rugy | Jul 18, 2012
The Department of Energy’s loan guarantee programs have been the focus of much public attention since energy companies Solyndra, Beacon Power, and Abound went bankrupt, leaving taxpayers to shoulder hundreds of mil- lions of dollars in loan guarantees. The evidence strongly suggests that these programs fall short of their stated goals of developing clean energy and creating jobs.
Todd Zywicki | Jul 10, 2012
Much of the government’s political intervention in the bankruptcy cases appears to have been motivated to benefit the UAW rather than the companies themselves over U.S. taxpayers, who put billions of dollars at risk to fund the bailouts.
Veronique de Rugy | Jun 19, 2012
For obvious reasons, more than any other recent events, the waste of taxpayers’ money due to Solyndra’s failure has attracted much attention. However, the problems with loan guarantees are much more fundamental than the cost of one or more failed projects.
| May 25, 2011
Anthony Sanders testified before the House Committee on Financial Services about steps to end the GSE bailout.

Speeches & Presentations

Expert Commentary

Apr 21, 2015

Licensing laws often block people from earning a living or starting new businesses, simply to protect politically powerful companies from competition. Licensing requirements are supposed to ensure that professionals, such as doctors or pharmacists, are qualified and honest — but these laws often do nothing more than create cartels, block the path to economic opportunity, and raise prices for consumers.
Mar 16, 2015

Without congressional reauthorization, the Export-Import Bank, which guarantees loans to the overseas customers of thousands of American companies, is slated to close this summer. The future of the institution is driving a wedge between free-market and pro-business Republican lawmakers. The New York Times Room for Debate recently posed this question: "Should Congress save the Export-Import Bank, or let it expire?"
Mar 15, 2015

Though the primary rationale for the Export-Import Bank is to extend cheap loan guarantees and direct loans to foreign companies to buy U.S goods under the pretense of boosting exports and creating jobs, economists have shown that these kinds of export credit subsidies will never raise the overall level of trade. The subsidies are also hurtful since they simply redistribute wealth away from unsubsidized American firms, employees, and consumers and direct it toward a tiny number of beneficiaries.
Feb 19, 2015

de Rugy responds to Rep. Fincher's latest claims about the Export-Import bank. She writes: "Sadly, the privileges Ex-Im extends to the few come at the expense of countless American firms and their workers. Unsubsidized firms may see reduced revenues—and their employees may see their hours cut, their salaries stagnate, or their jobs simply vanish because their employers cannot compete on the uneven playing field created by the federal government."
Feb 07, 2015

The Jan. 25 editorial “Save the Ex-Im Bank: A Frugal Congress Must Keep a Revenue Generator” claims that the Export-Import Bank is a good deal for taxpayers because it turns a profit every year. This is a misguided argument based on faulty accounting. In fact, the economists at the federal government’s nonpartisan Congressional Budget Office say it will yield $2 billion in losses for taxpayers in the next decade.
Feb 03, 2015

Ours is not a country where everyone plays by the same set of economic rules. Many longstanding federal and state policies privilege some businesses and not others. This tilted playing field isn’t just unfair; it’s grossly inefficient. It undermines competition, discourages innovation, and prompts businesses to expend billions of dollars in socially wasteful efforts to win the favor of politicians. But it need not be this way.


The following charts are the third in a series looking at the top foreign buyers of exports financed by the US Export-Import Bank (Ex-Im) from FY 2007 to FY 2013. The first new chart shows the total dollar amount of deals financed by Ex-Im in which the primary buyer was listed as being “unknown” or “various” in data made available to the public. It shows that 33 percent of the deals in Ex-Im’s public database used these vague labels.


Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University and a nationally syndicated columnist. Her primary research interests include the U.S. economy, the federal budget, homeland security, taxation, tax competition, and financial privacy. Her popular weekly charts, published by the Mercatus Center, address economic issues ranging from lessons on creating sustainable economic growth to the implications of government tax and fiscal policies. She has testified numerous times in front of Congress on the effects of fiscal stimulus, debt and deficits, and regulation on the economy.
Matthew Mitchell is a senior research fellow at the Mercatus Center at George Mason University, where he is the director for the Project for the Study of American Capitalism. He is also an adjunct professor of economics at Mason. In his writing and research, he specializes in economic freedom and economic growth, public-choice economics, and the economics of government favoritism toward particular businesses.
Eileen Norcross is a senior research fellow at the Mercatus Center at George Mason University. As director for the Mercatus Center’s State and Local Policy Project, she focuses on questions of public finance and how economic institutions support or hamper economic resiliency and civil society. She specializes in fiscal federalism and institutions, state and local governments and finance, pensions, public administration, and economic development.
Adam Thierer is a senior research fellow with the Technology Policy Program at the Mercatus Center at George Mason University. He specializes in technology, media, Internet, and free-speech policies, with a particular focus on online safety and digital privacy. His writings have appeared in the Wall Street Journal, the Economist, the Washington Post, the Atlantic, and Forbes, and he has appeared on national television and radio. Thierer is a frequent guest lecturer and has testified numerous times on Capitol Hill.


Veronique de Rugy | April 07, 2015
Ex-Im Bank provides billions of dollars in financing for foreign firms to purchase American goods, in theory supporting American jobs and promoting economic growth in developing economies. However many of these taxpayer-supported loans simply subsidize large foreign corporations in buying goods from major U.S. firms, instead of serving their intended purpose. Congress must reauthorize Ex-Im by June 2015 or the bank will be shuttered. Veronique de Rugy outlines the problems with Ex-Im in this interview.

Recent Events

Despite the ideological miles that separate them, activists in the Tea Party and Occupy Wall Street movements agree on one thing: both condemn the recent bailouts of wealthy and well-connected banks. But when it comes to government-granted privileges to particular firms or industries the bailouts were just the tip of the iceberg.


Media Clippings

Adam Thierer, Christopher Koopman | Jan 25, 2015
This excerpt originally appeared in Wall Street Journal.
Veronique de Rugy | Aug 24, 2014
This excerpt originally appeared in Wall Street Journal.
Veronique de Rugy | Jun 25, 2014
This excerpt originally appeared in The Washington Post.
| Jun 15, 2014
This excerpt originally appeared in The Wall Street Journal.
Veronique de Rugy | Jun 08, 2014
This excerpt originally appeared in The Wall Street Journal.
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