The people have got to know if their president is a crook,” U.S. President Richard Nixon told a national television audience on November 11, 1973, when asked at a press conference if donations from the dairy industry had caused him to reverse his position on dairy price supports. He added, “Well, I am not a crook.”
A bit over two years earlier, however, Nixon had a meeting at the White House with representatives of the dairy industry, who had apparently just given him a $2 million campaign pledge. With the tape running on March 23, 1971, Nixon said, “Uh, I know...that, uh, you are a group that are politically very conscious...And you’re willing to do something about it. And, I must say a lot of businessmen and others...don’t do anything about it. And you do, and I appreciate that. And I don’t have to spell it out.”
When the men from the trade association left, John Connally, one of Nixon’s advisers who didn’t realize that Nixon had bugged his own office, said to Nixon, “They are tough political operatives. This is a cold political deal.”
Two days later, as Dairy Education Board Executive Director Robert Cohen documents, Nixon announced to his cabinet a stunning change in administration position that would bring the dairy industry more than
$300 million in additional revenue for the following year.2 It’s an old political equation: invest a million dollars in a politician and see a three-hundred-fold or more return on your investment. Good business.
Similarly, as somebody involved in education issues (I’m on the board of directors of a private school in New Hampshire and have written seven education-related books), I had wondered why the Bush administration would propose doubling the testing burden on public schoolchildren when both good science and common sense say that decreasing classroom size, increasing teacher training and resources, and other less expensive and more local methods are far more effective at helping children learn.3
Then the office of Senator Jim Jeffords gave me a study from the Congressional Research Service from July 9, 2001, titled “Educational Testing: Bush Administration Proposals and Congressional Response.” The report, produced for members of Congress and not generally available to the public, noted, “Estimated aggregate state-level expenditures for assessment programs in FY2001 are $422.8 million.”4
Suddenly, it all made sense: most standardized tests are sold to schools by a small number of very large corporations, and those corporations would make hundreds of millions more dollars under the Bush proposals.
In fact, the report notes that the Senate version of the Bush plan would “authorize a total of $400 million for state assessment development grants for FY2002”; “authorize $110 million for expansion of NAEP [National Assessment of Educational Progress] state assessments”; and “authorize $50 million for state performance awards”—all in addition to the current $422 million that the states were already spending on testing. The testing industry would more than double in size in a single year, helping a handful of large corporations get very much richer from this redistribution of tax dollars, whether it helps kids learn or not.
George W. Bush’s brother, Neil, in fact, was then getting into the education business. And educational testing, now in 2010, as a result of No Child Left Behind, is a more than $2 billion a year industry.
The daily payoffs in Washington—the hundreds of millions that are funneled from corporate bank accounts to politicians’ campaigns, often producing results that are of questionable benefit to anybody but the donor corporations—evoke a response of cynicism among most Americans.
A Political Backlash
Political optimists see a different possibility than today’s rampant cynicism. And although most registered voters no longer bother to vote, some do believe that politicians who are truly dedicated to the public good can return power to the people. Those who believe that it is the role of government and not corporations to ensure our rights to “life, liberty, and the pursuit of happiness” view the increasingly populist talk of some national politicians as good news.
For example, Vermont Congressman Bernie Sanders published an article on his Web site on August 17, 2001, titled “The U.S. Needs a Political Revolution.” He wrote,
At a time when more and more Americans are giving up on the political process, and when the wealthy and multi-national corporations have unprecedented wealth and power, it is imperative that we launch a grass-roots revolution to enable ordinary Americans to regain control of their country....
It is no accident that while pharmaceutical and insurance companies donate huge sums of money into the political process, American citizens must pay, by far, the highest prices in the world for prescription drugs. Those same companies and their political donations ensure that the United Stares remains the only industrialized nation that does not have a national health care program providing health care to all.The rich hold $25,000-a-plate fundraisers for their candidates. Why would they pay so much for a chicken dinner? The answer is, they want access and special favors. It is no accident that after raising more money from the wealthy for his campaign than any candidate in history, President Bush and the Republican leadership passed a $1.3 trillion dollar tax bill which provides $500 billion in tax breaks for the wealthiest 1 percent of Americans.
It is no accident that, rather than raising the minimum wage, the President and congressional leadership are providing billions in tax breaks and subsidies to the major oil, gas, and coal companies. It is also, sadly, no accident that almost 20 percent of our children live in poverty, schools throughout the country are physically deteriorating, college graduates begin their careers deeply in debt, and millions of working class people are unable to find affordable housing.
My read of it is that Sanders is suggesting that we again try real “republican democracy”—a government truly of, by, and for humans—that we begin to put people first and the rights and the powers of corporations (and governments, churches, and any other human-made institutions) second.
This brings us back to those two meta-political parties: the politicians who work on behalf of corporations and the politicians who work on behalf of humans. Increasingly, citizens of democratic nations are setting aside labels like Republican, Democrat, Tory, and Labour when considering their politicians. Instead the labels in people’s minds are: working in the interests of corporations and working in the interests of individual citizens.
How Public Opinion Is Influenced by Concentrated Money
Poll after poll has shown that Americans overwhelmingly support reform of our health-care system. People are concerned about costs and quality of care. Yet in 1993, when President Bill Clinton proposed that the government offer some form of health-care protection to the nation’s 40-plus-million uninsured, the insurance industry spent an estimated $100 million on lobbying and $60 million on advertising and provided members of Congress with about 350 free trips.
What actually happened as a result of all this spending is extraordinarily ironic. Industry polls showed that people cared more about being able to choose their own doctor than most other medical issues. Taking advantage of this, an infamous series of ads featuring “Harry and Louise” warned Americans that under a government-run health insurance program they would lose their ability to select the doctor of their choice.
The advertising worked. People panicked, and American public opinion swung from strong support for Clinton’s proposals to overwhelming fear of them. The Internet became flooded with insulting e-mails about the evils of “Hillary’s” insurance proposal.
Even more ironically, those fears have been realized today—without the Clinton proposal. Back in 1993 you could pretty much go to any doctor you wanted (assuming you were insured), and your insurance would almost always pay for it. Overtly restricting that ability was never part of the Clinton proposal, but because of the power of the Harry and Louise ads people came to believe that it was.
And within a few years, insurance companies and HMOs (health maintenance organizations) began to crack down on consumers who wanted to select their own doctors. Today fewer Americans have that privilege than in 1993, even though it’s fully available to citizens of virtually every country that has a national health-care program...which is every developed country in the world except the United States.
It turns out there is a strong reason why the insurance industry was eager to invest so much cash in advertising and lobbying to keep the government from competing with it in the realm of health care: profits. For every $100 that passes through the hands of the government-administered Medicare programs, between $2 and $3 is spent by Medicare on administration, leaving $97 to $98 to pay for medical services and drugs. But of every $100 that flows through corporate insurance programs and HMOs, $10 to $45 sticks to corporate fingers along the way. As Yale University Professor of Public Policy Theodore R. Marmor, author of The Politics of Medicare, said, “The costs of administering private insurance are somewhere between 5 and 10 times the costs of administering Medicare.”5
After all, Medicare doesn’t have lavish corporate headquarters and corporate jets, nor does it pay expensive lobbying firms in Washington to work on its behalf. It doesn’t pay out profits in the form of dividends to its shareholders. And it doesn’t compensate its top executives with more than $1 million a year, as does each of the largest of the American insurance companies. The result, as Professor Marmor points out, is that Canadians—who receive health care at one-half the cost of comparable services in the United States because no insurance companies are in the middle—“are somewhat healthier than citizens of the United States, use more hospital days per thousand, and visit their physicians more often” because services are freely available.6
Yet most citizens of the United States have no idea what it’s like to live in a country with national health care. When our family lived in Germany for a year in the late 1980s, we were amazed at how smoothly its health-care system worked: we could make any appointment with any physician, and they were excellent at what they did. But even describing the reality of that experience draws uncomprehending stares from Americans, who have been fed a steady corporate diet of very one-sided information.
This is why when President Obama decided he wanted one of the main legacies of his presidency to be a solution to America’s health-care mess, he first met privately and secretly with the pharmaceutical, hospital, and health insurance industries. He cut a deal with them, if news reports are to be believed (and they were not denied by the Obama administration), that he would protect their interests and give them tens of millions of new customers if they would hold back and not spend hundreds of millions of dollars to destroy his attempts the way they had with Clinton.
Something really rotten has taken hold of the American political system when the president of the United States must go to big corporations on bended knee and get their approval before suggesting legislation.
Polluters Pass “Go”
In 1995 the new governor of Texas responded to the needs of the “polluting industries” that had contributed more than $4 million (about 20 percent of his total) to his election campaign the year before. Thus, as soon as he was in office, George W. Bush signed into law the Texas Environmental Health and Safety Audit Privilege Act, also known as the “polluter immunity law.” This new law, which has since been emulated in twenty-five other states and was tried at the federal level during the Bush presidency, allows polluting industries to avoid prosecution for pollution violations if they themselves report their own crimes to themselves in an internal audit. It also gives them the ability to prevent the public from knowing about their violations.
As Arizona’s assistant attorney general, David Ronald, said, “Only the business with something to hide would benefit from a law that turns data gathered from environmental audits into secret information.”7 Some of these laws even provide for a year in jail and a $10,000 fine for any human who reveals to the public or to government agencies any corporate pollution discovered in an audit, thus discouraging investigative reporting or whistle-blowing employees.
Like with health-care policy, these laws that increase the power and the profitability of the nation’s largest corporations at the expense of smaller companies who play by the rules—and to the detriment of average citizens—from the beginning are influenced by enormous amounts of “corporate free speech” in the form of cash for politicians and political parties.
In a Democracy...
The point for a democracy is, “What is the will of the people?” That will may change over time, but it is undemocratic when it is shaped by the single voice that shouts the loudest because there are profits to be made. Democracy is more important than any single debate, and this is a classic example of how democratic republican processes have been twisted because of the concept of corporate personhood.
7. See Christopher Bedford, “Dirty Secrets: The Corporations' Campaign for an Envi- ronmental Audit Privilege,” Environmental Action Foundation, the Good Neighbor Project for Sustainable Industries and Communities Concerned about Corporations, February 1996, http://www.mapcruzin.com/scruztri/docs/r2.htm.
This material is not covered under Creative Commons license and cannot be published without the permission of the author and Berrett-Koehler Publishers.
Copyright Thom Hartmann and Mythical Research, Inc.