The diaries like this onediscussing anti-democracy corporate influences have been excellent. There was some attempthereto do so, but even that one gets bogged down in one particular debate about future policy. My one beef with them is that they leave the conversation at an abstract level rather than bringing it down home to practical examples that concretely illustrate the danger of creeping corporate political influence damaging our daily lives. The issue is much wider than future policy. It is found in present outcomes and in historical analog. This diary is dedicated to discussing some of those examples so that there can be no mistake about why this core issue already presents us with the dangers we face.
a) Salmonella-frosted peanuts.
You should listen to Rachel Maddow as she reports on the lack of effective enforcement of FDA regulation due to corporate influence that harmed the public interest:
The core element that she discusses is how allowing the industry to regulate itself defeats the purpose of protecting the public interest. Instead, corporate interests win o out over regulations that are design to protect against corporate interest where they conflict with the public interest.
b) Blackwater
Blackwater and similar companies conduct military and logistical operations in Iraq in support of the American government.
There are legitimate reasons for having such contractors.
The point here is not that they are all bad. Or that corporations are all bad. The point is to view such relationships with skepticism and with a high level of accountability to the interest of the public that does not presently exist, and which is actually under assault. The trend has been less scrutiny and accountability. Not more.
c) The Meltdown of 2008
At the risk of creating some controversy, last year's bubble was significantly impacted by Bill Clinton's decisions to go on a deregulation bing in the 90s. However, last year was a crisis for which economically both parties should share the blame.
d) "Calls For Protectionist Retaliation Against China Rise"
This one is more technical, but crucial to how corporate influence distorts economic policies that determines job creation in the US:
"Even though China’s partners have various favored industries here and there, the scope and scale of these interventions pale next to what China achieves through its currency manipulation. Of course, the US has aided and abetted this practice by being unwilling to call China a currency manipulator long ago, before they got so deeply hooked on massive exports and the US became addicted to cheap capital."
The basic point of this issue can be found here:
"It should not take long for the Chinese to learn that they are much more dependent on access to the US market than Americans are dependent on Chinese goods. Virtually all of the goods that the US imports from China could be sourced at home or in Indonesia, the Philippines or South Korea. China would find it difficult to find other foreign markets for the goods that it no longer sold in the US…. Such an initiative by the Obama administration would be much more significant as a jobs-creation measure than anything else it could adopt."
LINK
Or, why are we favoring policies that reduce job creation, but seem advantageous to finance based economy? We do this even while it places us at a disadvantage on issues like deficits and speculative asset bubbles. You should look into the issue more. It is complicated, but it is one of those issues that affects our lives in ways we don't think about.
There are many examples that do not make for splash headlines.
e) On being Cognitively captured
This is about how the ideology that leads to corporate influence growing in DC often results from a process that is not at all pragmatic in terms of solutions, but instead reflect an ideological bent.
There are subtle ways in which creeping corporatism. Oftentimes, in discussing what to do with the banks that are in crisis, the frame has been ideological even while people claim it is pragmatic. They will say nationalization was not or is not possible because of American cultural values. First, this argument lacks empiricism. We already nationalize banks. It is called receivership. Second, the real argument is actually one of ideological preference. What people seem to really be saying is that they would prefer to go through measures that historically did not work in other countries like Japan because of how they view the American system. The "possible" that people often claim that the administration seeks to accomplish is really just ideological cover. Look here, at what Geither said some months ago about nationalization:
"He discouraged speculation that the plan would include the nationalization of some banks.
"We have a financial system that is run by private shareholders, managed by private institutions, and we'd like to do our best to preserve that system," he said. "
LINK
Even if it were possible, Geithner would not push for receivership of the too-big-to-fail banks. That in a nutshell is ideology.
It is ideology premised on allowing corporations to control the debate. Whether the fault lies in Congress where they seek to water down regulations or in the White House where they argue too-big-to-fail is an acceptable policy, the result is the same- corporate interests are superseding the public's interest.
The danger here is not merely what these examples represent. They are in how the Overton Window shifts to favor corporate interest over the public's interest. What was at first outrageous- that banks should not be too big to fail- becomes acceptable under neoliberal ideological belief.
The fascinating thing, then, about neoliberalism as ideology is that while it claims to be rational and non-emotional, the actual policy is deeply rooted in irrational policy making if the interest is protecting the public's interest. Of course, I assume here that they are interested in the public's interest, but there may be doubt about that question too.
More deeply, the economictheories are themselves bullshit since people are hardly as rational as the neoliberal theory would require for the theories to work. Markets certainly are not always rational. These polices were tried in full effect abroad, and they failed there as well.
"Neo-liberal economic policies arising from the 1980s debt crisis caused increasing poverty and socioeconomic inequality."
LINK
And, as for avoiding nationalization of banks, we can see from Japan's lost decade some similarities to what we may be facing.
But, that hardly seems to matter to ideologues with in the Democratic Party. What counts is beliefs about the alternatives to neoliberal economic policies and emotions about hippies taking over and other myths.
There are reasons why we regulate companies. It has nothing do with being anti-corporate interests. We regulate because we are pro-public interest.
These examples above are mild compared to their historical analogs. There are many more including in areas as far and wide as student loans, worker safety regulations and environmental issues.
Those examples are where we do not wish to return. Neoliberalism's danger is not that it will conserve the status quo. By pushing for corporate control of things that are the public's interest- its danger is that it regresses us to a period of time that Americans fought hard to overcome. We are racing to a bottom that history tells us leads to a great deal of suffering. For example, in the case of the health insurance debate, we are racing to allow a monopoly to hold a captive consumer hostage through mandates. Monopolies went out of style with Teddy Roosovelt, a well-known Marxist leftist, due to their deleterious effect on markets and consumers. All jokes aside, this is why we fight.