Washington Inc.

This extract is from a 2011 opinion I wrote titled Has democracy failed us or have we failed it?

Elections are an expensive business and no candidate is likely to achieve re-election without financial backers, making them especially vulnerable to outside influence. The finance industry alone made $63 million in campaign contributions to Federal Candidates during the 2010 electoral cycle, according to the Center for Responsive Politics. That will buy you a lot of influence on the Hill, but is merely the tip of the iceberg. Interest groups spent $3.5 billion in that year on lobbying Congress and federal agencies ($473 million from the finance sector). While that money does not flow directly to candidates it acts as an enticing career path/retirement plan for both Representatives and senior staffers.

The revolving door between Capitol Hill and the big lobbying firms parachutes former elected officials and staffers into jobs as lobbyists, consultants and strategists — while infiltrating their best and brightest into positions within government; a constant exchange of power, influence and money. More than 75 percent of the 363 former senators or representatives end up employed by lobbying firms, either as lobbyists or advisors.

Revolving doors continue to plague Washington and financial market regulators. Enforcing lengthy “restraint of trade” periods between the two roles would restrict this. Preventing politicians from joining lobbying firms for two to three years — and financial regulators from joining Wall Street for a similar period — would reduce the risk of “captive regulators”.

9 Replies to “Washington Inc.”

  1. Totally agree Colin. Entitlement occurs at all levels. The USA (and other capitalist democracies) is geting closer and closer to socialism……..

  2. With this facility available, you cannot but think that the politician when in power would always do things which would earn him/her a sinecure as lobbyists etc. on retirement from the congress.

  3. Have just read the excellent paper The Keynesian Path to Fiscal Irresponsibility by Dwight R. Lee. Having been coddled all my life by Keynesian spending, and tacitly supporting these policies, I now agree with the argument that the birds which were thrown into the future are all coming home to roost. There may be an almighty collapse – but inflation seems the weasel way out. This leaves gold, precious metals and critical commodities as the obvious life raft. What am I missing? JimL

    1. A debt contraction will cause deflation. Printing money as the Fed is doing will prevent that, while not causing much inflation if managed correctly.

  4. If more Americans understood the problems this country is facing, they could convey their political will to the Congress man or woman, who is supposed to “represent” them, and things would change. Regardless of the power that lobbyists have, if a Congress man or woman understands that they will not be re-elected if they don’t follow the directions of their consitutency, things would change. Sadly, most Americans don’t bother to read and understand what’s happening. Instead, most spend their free time watching and reading celebrity and reality show garbage. Americans need to wake up, get informed and let their Congressional representatives know how they want them to vote on key issues. Congress won’t represent you if they know you’re not watching. It’s just human nature. And whatever moniker you want to attach to government is meaningless, if a few own and control everything. In actuality, if the momentum does not change, it will eventually be a few feudal lordship types controlling the whole thing. And we are well along that road. The middle class is eroding rapidly, and without it, there can be no democracy. Ironically, I don’t think the few don’t even understand that they are killing the golden goose.

      1. The sad reality is the US story is that the way you measure successes is the size of your pile of stuff at the end of your life.
        So until that changes to one of cooperation nothing will change. The storm that just hit for some will be total devastation, for others it will be just another business opportunity.

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