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Critical of Capitalism

Pigs at the Trough--Arianna Huffington's book on corporate democracy

ARIANNA HUFFINGTONS NEW YORK TIMES NONFICTION BEST SELLER OF 2003; A SAMPLING OF PIGS AT THE TROUGH

 

The purpose of government is the promotion of the public wellbeing; there can be no other--Catherine the Great.  To place any other concern before is to violate this principle.  There can be no effective control of corporation while their political activity remains.  To put an end to it will be neither a short nor an easy task.--Theodore Roosevelt, August 31, 1910.

 

 

PIGS AT THE TROUGH

ARIANNA HUFFINGTON

 

 

What Counts as a Conflict of Interest to Congress?

           We all know that those who play important roles in the economy can communicate either directly or through lobbies with those in Congress.[i]  In what follows, I will be relying upon the New York Times best seller by Arianna Huffingtons, Pigs at the Trough (Crown Publishers, NY, 2003) to present some typical facts and their results. 

Most of the self-serving action by business is through lobbyists (the Business Roundtable is an equally important policy shaper).  Some lobbyists, such as Ed Gillespie, have direct and easy access to the oval office. 

A SAMPLE OF GILLESPIES CLIENTS AND HIS ACTIONS:

1.  Enron:  Hired Gillespie's firm for around $700,000 concerning energy plans.  Dick Cheney and the staff of his Energy Task Force had at least six meetings with Enron representatives.

2.  National Association of Realtors:  Gillespie persuaded Treasury Secretary Paul O'Neill to postpone a proposal that would have allowed banks into the real estate brokerage business.

3.  Daimler-Chrysler:  In March of 2002, the higher fuel efficiency standards were yanked out of the Bushs energy bill.

4.  American for Better Education:  The phony grassroots organization (ran by Gillespie's Washington Office) raised over $1 million to lobby for Bushs education bill.

21st Century Energy Project:  A coalition of Gillespie's clients used to lobby for Bushs energy bill that passed the House in August of 2001.  It contained about $33 billion of tax breaks for the energy industry (83).

          There are hundreds of firms whose business is the manipulation of government legislation for the sake of their clients best interests as measured by profits.  Gillespie is one of 4 that Arianna uses to make her point about how the actions of lobbyists are not in the publics interest at all.

          Arianna then goes on to describe how these lobbying firms hire Senators and Congressmen family members, former Congressmen, collogues, former generals, and high-ranking bureaucrats.   She lists 5 sons, 2 wives, and one aunt (95).  Former Montana Governor, Marc Racicot has two hats:  one as a lobbyist, the other as Chairman of the Republican National Committee (86). 

          In 2 years, between 97 and 99 Phillip Morris spent $54,216,000 on lobbying, and the big four tobacco companies spent in 1998, $365,000,000.  This amounts to 81 dollars for each of the persons who died early from the effects of tobacco in this country, and if we assume the average early retirement at 3 years, that would amount to $27 for each year retired to the grave.   Other big contributors include Bell Atlantic which spent $49.6 million in 1996. 

These contributions yield benefits.  General Electric spent $23.3 million to have among other things Washington pressure the EPA from fining GE for polluting the Hudson River.  Lobbyist Gillespie persuaded, on behalf of the steel industry, that there should be a tariff on imported steel, contrary to early free-trade proposals.  A look at the legislation exposes its venal foundation.  Newt Gingrich et al passed the Private Securities Litigation Reform Act, which in among other things protected auditing companies from shareholder lawsuits.  With a stroke of the pen, Congress made it easier for corporate thieves to plunder public companies without fear of being sued (110).  Business wants more freedom to fleece the public, and their contributions have paid off.  Each business-like a feudal statehas its own ax to grind, and the system of contributions and lobbying is the motor that turns the grinding stone. 

One would suppose that the logic which resulted in the regulations, many of which had their birth during the administrations of the two Roosevelts, would still be understood to be sound.  And one would suppose that the S&L collapse, costing this nation over $350 billion, would remind the politicians how sound that old logic was and is.  This wave of deregulation in a series of abuses, such as gouging of the State of California during its orchestrated power shortage, continues.  Another type of headline maker has been the failed companies who seemed financial sound right up to their bankruptcy. WorldCom's crisis alone cost telecom investors $180 billion, while the investors in Enron lost $80 billion.  By the fall of 2002, the scandals surrounding Enron, Adelphia, Global Crossing, Quest, Kmart, Tyco, Citigroup, and WorldCom had lead to a collective loss of almost $700 billion in shareholder value sine the share were at their peak (175).  The errors in accounting that has resulted in a lack of confidence in the corporate reports similar to the scandal riddle 20s. 

          There is something very troubling by all this.  First those who by there office are commissioned to promote the public weal, they arent.  Second, it isnt how well the vehicle runs, but how well it could.  And third is the assumption that letting things in the business realm take care of themselves is the best solution.[ii]  To this Franklin D. Roosevelts statement in his Second Inaugural Address, 1937, is a fitting reply:  Old truths have been relearned; untruths have been unlearned.  We have always know7 that heedless self-interest was bad morals; we know now that it is bad economics.  Out of the collapse of prosperity whose builders boasted their practicality has come the conviction that in the long run economic morality pays.  Congress for the immediate reward of contributions scuffs at this old lesson, and they will continue to scuff until the electorate empowers a political party that has a high standard of service.  This standard will be fulfilled when we learn the wisdom of Plato; namely, that the brightest and best educated ought to run government.



[i]   For the sake of simplicity, I will often include the presidents office within the meaning of Congress.  The two work together within their political party; thus, a distinction would only slow your reading and not promote understanding.

[ii]  The argument runs as follows:  Allow all but the most egregious business practices.  Forces of the market place will create limits.  The alternative of government intervening and establishing limits will cause even more harm both to business and the public. 


 

THE ABOVE ARTICLE REVEALS THAT CONGRESSS FIRST INTEREST IS THE SERVING OF CORPORATE GREED.  FOR FURTHER ENLIGHTENMENT READ ABOUT HOW THEY DO BUSINESS, OF THE UNESSENTIAL STOCKMARKET, AND OF CHANGES THAT WOULD RESULT IN SOCIAL JUSTICE. 

Philosophy teaches the skills to see how the world ought to be.  Mathematics is the Queen for science, and logical analysis the Queen for skepticism.