Tuesday, September 1, 2009

Democracy is dead ... lobbyists rule America

Anyone who has given even a cursory look at the Waxman-Markey climate bill would have to agree. From the insertion of 300 pages of amendments at 3:00 a.m. the day of the House vote to the lobbyists fingerprints on every one of the 1400+ pages of the thing, it is a perversion of the founding fathers conception of representative democracy.

The incestuous relationship between the rentseekers and the lawmakers prompted me to study Mussolini's Corporatism. Although the author of the linked piece is more dogmatic than I, the points he makes are reality-based observations.

Whether you are approaching from a political or investment perspective this is crucial information for understanding and decision making.

Should enough Senator's get their palms greased, we will do everything we can to point out the opportunities to profit by way of portfolio and direct investment.
From Paul Farrell at MarketWatch:

16-point manifesto for the new 'Lobbyist Nation of America'

Democracy dead? Lobbyists ruling America? Lobbyists the new "Unseen Hand" of capitalism? Sadly yes.

And here's why: Ask any neuroeconomist, behavioral-finance quant, investment psychologist or other practitioner of the mysterious "science of irrationality" and they'll tell you that Americans have two self-sabotaging mental biases that killed democracy from within: "Denial" and "Magical Thinking" make us easy targets. Our brains are being manipulated by clandestine forces beyond our control. We can't see them or resist.

Yet we refuse to believe in this new Orwellian America. We prefer the world of magic, myth and illusion.

Yes, folks, democracy is dead. Oh, the illusion will be kept alive in our history books, in the rhetoric of politicians, in the manipulated minds of America's 95 million Main Street investors. The propaganda machine works. Like a child's fairy tale, democracy has been deeply imbedded in our brains for decades; we prefer believing old, familiar stories. They comfort us, even when no longer true. The real democracy, what so many fought and died for since 1776, is dead.

Lobbyists now run America, own America, rule America. Forget the 537 politicians you thought we elected to the White House, Senate and Congress to run America for us. No, they're mere puppets, pawns for the "Happy Conspiracy," an oligopoly, plutocracy, cabal, monopoly all-in-one -- a private club of America's richest few on Wall Street, in Washington and in Corporate America.

Voters and elections are irrelevant. Lobbyists decide what's in the best interests of this elite club. The usual suspects? Try the Forbes 400.

Last year Michael Barone wrote a "Defense of Lobbyists" in U.S. News & World Report: "Lobbying is as American as apple pie, going back to the colonies." How naïve, how in denial.

He obviously missed reading Bob Kaiser's brilliant 25-part series in the Washington Post a couple years earlier, on "how lobbying became Washington's biggest business." Turns out that modern lobbying actually began in the mid-1970s with the innovative "earmarked appropriations, federal funds directed by Congress to private institutions when no federal agency had proposed spending the money."

Kaiser expanded the series to: "So Damn Much Money: The Triumph of Lobbying and the Corrosion of American Government." In just three decades, Washington has earmarked hundreds of billions thanks to lobbyists peddling influence bribes to buy Washington votes.

After all, the cost of a Senate race has exploded from $437,000 to $7.9 million. So lobbyists shovel millions to friendly senators, like Connecticut Democrat Christopher Dodd and Alabama Republican Richard Shelby.

Lobbyists love spending your tax dollars

In another example of lobbyists stealing taxpayer dollars Kaiser tells how "last fall the House of Representatives set off a sudden collapse of the stock market by voting against the first version of the bailout legislation that had been hurriedly written to try to stabilize American banks and other financial institutions." Lobbyists then "scrambled to change the legislation in ways that would win support for it from a majority of Congressmen."

How? Simple: Within just days they manipulated Congress to throw in more taxpayer cash. "Sweeteners" included excise-tax rebates for Puerto Rican rum. tax breaks for stock-car-track owners, tax breaks for Hollywood movies made in the USA and lots more. So "days after rejecting the $750 billion bailout, the House approved it."

Why so easy? There's a huge, highly paid army of mercenary lobbyists in Washington. Registered lobbyists may be 42,000 versus a mere 537 elected officials. American University political scientist James Thurber says there are actually 261,000 members of the "influence-lobbying complex" running your government. Many are former congressmen, senators and staffers. Others are ad hoc mercenaries, like the 350 hired by the GOP just to kill health-care reforms at a cost over a million bucks a day.

Another example: Former Senate leader Tom Daschle is not registered, yet has emerged as a key go-between for Obama and health-care insurers, a perfect example of how Obama's $9 trillion programs have fueled an explosion of influence peddlers. Daschle told the New York Times he sees no conflicts, although he's highly paid by insurers. He calls himself a neutral "resource."

This anti-democracy trend was recently exposed in a BusinessWeek piece, "Don't Call Them Lobbyists," where we see this industry rebranding itself as cooperators, as "special policy advisors," "crisis managers" and "strategic planners." Reminds us of that fairy tale about a "wolf in sheep's clothing" guarding the hen house....MORE