quarta-feira, 3 de dezembro de 2014

Where the Money Leads

By Zoltan Zidegy

'Traditionally in American history, politics is like a seesaw: When one side is
up the other side is down,” said Peter Wehner, a former aide to President George
W. Bush. “Now it's as if the seesaw is broken; the public is distrustful of both
parties.” Wall Street Journal (11-04-14)

“Follow the money” is a seemingly simple, but telling popular prescription for
discerning people's motives, a slogan made popular by literature and movies.

But it is more than that. It is also a useful key to unlocking the mysteries of
social processes and institutions. In a society that affixes a monetary worth on
everything, including opinions, ideas, and personal values, tracking dollars and
cents becomes one of the best guides to our understanding of events unfolding
around us.

Take elections, for example.

Every high school Civics class teaches that elections are the highest expression
of democratic practices. Apart from the direct democracy of legend-- the New
England town meeting or the Swiss canton assemblies-- organized
secret-ballot-style elections count as the democratic ideal deeply embedded in
every US school-age child's mind.

Let's put aside the arrogant high hypocrisy of US and European politicians and
pundits who deride secret ballots when they result in the election of a Chavez,
Morales, Maduro, or Correa. That will make for a juicy topic on another

Instead, let's examine what the flow of money tells us about the gold standard
of democracy as celebrated in Europe and the US.

Surely, no one would deny that money has a profound effect upon election
outcomes. That comes as old news. Even before the dominance of party politics,
even before the evolution of party politics into two-party politics, money
played a critical factor in advantaging issues, campaigns, and candidates.

To the extent that mass engagement-- rallies, outreach, canvassing, etc.-- could
match or even trump both the corrupting and opinion-changing power of money,
electoral democracy maintained an aura of legitimacy. To be sure, buying
elections seems a nasty business, but as long as elections remained highly
contested extravaganzas drawing interest and engagement, credibility remains

New and changing technologies cast a lengthening shadow over the electoral
process. News and entertainment media, like radio, were only too happy to take
advertising dollars to promote electoral campaigns. At the same time, these
technologies eroded the efficacy of traditional campaigns reliant upon campaign
workers' sweat and shoe leather.

With television and now the Internet, the power of media and media dollars has
grown exponentially. It has hardly gone unnoticed that these shifts have
amplified the power of money and diminished the traditional get-out-the-vote
efforts of unions, civil rights, and other people's organizations.

Most recently, the Supreme Court's Citizens United decision has opened the
spigot of unregulated cash into elections, further overwhelming any counter
forces to the outright purchase of candidates and election results.

Readers may find nothing new here. The sordid story of money's corrupting and
deflecting influence has certainly been told before, as has the pat remedy
offered by reformers. To return to the halcyon days of US electoral democracy is
simply a matter of establishing financial limits on campaigns and campaign
contributions. By leveling and limiting the electoral playing field, we can
restore the legitimacy tainted by money.

Unfortunately, this idealistic solution will itself be overpowered by the power
of money. The traditional forces in US politics are not unhappy with buying and
selling political power, except insofar as their own money is not put at a

But the reformist panacea would not work even if it were implemented. Advocates
of campaign financial reform fail to see that capitalism and informed,
independent, and authentically democratic electoral processes are incompatible.
Capitalism, unerringly and universally, erodes and smothers democracy.
Eliminating, even significantly, reducing the power of money in politics under a
capitalist system is an impossibility. The historical trajectory goes the other

A Broken System

Since the New Deal era, political partisanship and the accompanying flow of
money was linked to Party politics. Corporations and the wealthy gave generously
to opponents of the New Deal, the Republican Party. To a great extent, the
people power (and significant independent money) of unions and other progressive
organizations served as an adequate counterweight to the resources of the rich
and powerful. The Democratic Party enjoyed the benefits of this practice.

The television and money-driven election of JF Kennedy in 1960 marked a
watershed in both the diminution of issue relevancy and the maturation of
political marketing. Money and the advertising and marketing attention that
money bought moved to center stage. Key chains, buttons and inscribed pens were
replaced by multimillion dollar television advertisements in the buying of
election outcomes.

In 1964, the organic link between the money of wealth and power and the
Republican Party began to stretch with the campaign of Barry Goldwater. So
called “liberal Republicans” of the East Coast establishment recoiled from what
they perceived as extremism, leaving Goldwater's campaign treasuries to be
filled by the extreme right's wealthy godfathers in the Southwestern and Western
US (The looney right rebounded to Goldwater's loss by investing heavily in
rallying and expanding the 26 million Goldwater voter base and by buying a
broader, louder, but less shrill voice in the media; that project paid off
handsomely by 1980).

While it is understandable that donors would spend to their interests-- support
candidates of shared ideology-- things began to change with the Democratic
Party's retreat from New Deal economic thinking, the general decline of
traditional Party politics, and the rise of the politics of celebrity and
personality. With advertising and marketing domination of electoral campaigns,
constructing an attractive personal narrative replaced issues and
accomplishments-- contrived image replaced content.

Today, the two-party system holds electoral politics in its tight grip. And
issue-driven politics has been replaced by the politics of flag pins, winning
smiles and a “wholesome” family.

Undoubtedly, the decline of substance in politics further encouraged the
activity of sleazy lobbyists and influence peddling. Politicians are not faced
with the conflict of principles against powerful interests because electoral
politics have turned away from principles.

We see the cynicism of principle in the Republican Party's rejection of its
ideological zealots. So called “Tea Party” radicals sat well with the Republican
corporate leaders when they were energizing electoral campaigns, but the zealots
were challenged after setbacks in 2012. Today, the Republican corporate god
fathers are making every effort to temper party radicalism in order to insure
the only important principle: electability.

The Democratic Party, on the other hand, simply ignores its left wing, treating
it alternately as an embarrassment or a stepchild. It is this trivialization of
principle and ideology that channels the flow of money today.

Barren Politics

I wrote in 2008:

This election cycle has revealed something new: Democrats are raising more money
from corporate interests for their campaigns than the traditionally dominant
Republicans. This process began before the 2006 elections, accelerated sharply
in the Presidential elections, strengthened in the early primaries and continued
into 2008. In March, 2008, McCain gained somewhat on his Democratic rivals, but
still fell well below the total raised by the two Democrats.

Within the Democratic camp, Clinton dominated most corporate contributions until
2008, when Obama enjoyed big gains, pushing ahead through March especially in
the key industries of finance, lawyers/lobbyists, communications and health.

Wall Street has strongly supported the Democratic candidates over the
Republicans. Through the end of 2007, seven of the big 8 financial firms
(Goldman Sachs, Citigroup, Morgan Stanley, Lehman Brothers, JP Morgan Chase,
UBS, and Credit Suisse) showed a decided preference towards the Democrats. Only
Merrill Lynch gave more to Republicans, though they gave the single most to
Clinton. The Wall Street Journal (2-3/4-08), while noting that Obama receives a
notable number of contributions from small donors, pointed out that “…even for
Sen. Obama, the finance industry was still the richest source of cash overall…”

Through February, Obama led the other candidates in contributions from the
pharmaceutical industry and was in a virtual dead heat with Clinton with respect
to the energy sector.

These numbers strongly suggest that candidates, especially Democratic Party
candidates, are unlikely to challenge their corporate sponsors in any meaningful

Clearly, Corporate America was not afraid that Obama or Clinton would step on
their toes or even stand in their way. While the Republican message and program
were more overtly and adamantly pro-business, big business was not trying to
swing the election their way. While they may have differed on social and even
foreign policy questions, wealth and power understood that the Democrats would
not challenge them on any matters relevant to their business agenda. Six years
after, they appear to have been right.

Another way to illustrate the uncoupling of corporate money from party ideology
is through the trend in corporate PACs to shovel money to incumbents of either
party: In 1978 corporate PACs gave 40% of their contributions to House
incumbents; in 2014, that number had leaped to 74%.

Corporations are not trying to deliver a message; they are outright buying all
of the candidates.

With respect to this year's November 4 interim election, corporate PACs have
shifted their support-- sometimes dramatically-- from Democrats in key races to
Republicans over the last 18 months (WSJ, 10-29-14). Obviously, neither the
corporations nor the candidates have changed their agendas greatly. So it's not
about issues, but electability.

It should be transparent that two-party politics in the age of extreme
concentrations of wealth and media influence is far from a rousing example of
democratic process. Consequently, we should surely not expect the results of the
tainted process to be democratic. Like the commercialization of commodities, the
commercialization of politics results eventually in the domination of the market
by a few products (parties, candidates) and the minimizing of their differences.
We no more pick our leaders than we pick the products offered in the showroom.

November 7, 2014

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