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.

21^st 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.