WASHINGTON — The Jack Abramoff scandal has many individual
players, but it’s also added fuel to an older and broader theme —
the quest to purge politics of money. Well, at least, money
provided by business. Money provided by government and foundations
has largely escaped scrutiny.
Political funding has received the most attention, but the idea
has now spread well beyond politics into the larger policy world.
The goal is to eliminate business funding not only from politics,
but from the entire intellectual world. Many major science and
medical journals, for example, now impose financial disclosure
requirements on their authors, stigmatizing research underwritten
by business. Anti-business groups seek to bar from government
advisory committees individuals who’ve consulted with business.
And, as the fallout from the Abramoff scandal demonstrates, this
assault has now extended to demonizing corporate support for
conservative policy groups. Several think tank analysts have
already been affected, losing their syndicated columns, and, in one
case, their job because of past financial support from interested
parties.
The underlying theory is that to allow interested parties to
provide advice on public policy involves a conflict of interest.
Such conflicts might lead to distortions in the “objective” advice
needed for sound public policy and, thus, must be driven out of the
temple. If the public interest is to be protected, special
interests (or, more selectively, business-related special
interests) must not be allowed to influence the process.
BUT INTEREST GROUP POLITICS is not a new phenomenon. In fact, they
date back to the founding of the American republic. The Framers of
the Constitution were deeply concerned over how to address
competing interest groups, which they called “faction.” James
Madison defined faction as:
“A number of citizens, whether amounting to a majority or a
minority of the whole, who are united and actuated by some common
impulse of passion, or of interest, adverse to the rights of other
citizens, or to the permanent and aggregate interests of the
community.”
Unlike advocates of McCain-Feingold campaign reform, the Framers
were not utopian planners; they were well aware of the danger that,
in Madison’s words, “unworthy candidates” might “practice with
success the vicious arts, by which elections are too often
carried.” They sought a government that was able to act effectively
when necessary, but that would pose only a minimal threat to the
economic and civil liberties of its citizenry. The Framers’ answer
was not to drive faction out of politics, but rather a plan to set
faction against faction-to use ambition to counter ambition. They
didn’t restrict faction; they encouraged it.
The Constitution accomplished this through its system of checks
and balances, and divided and enumerated powers. Its Bill of Rights
makes explicit the paramount importance of speech and other aspects
of liberty. Liberty produces faction, but that’s not an undesirable
by-product; it’s an essential element. As Madison put it, “it could
not be less folly to abolish liberty, which is essential to
political life because it nourishes faction, than it would be to
wish the annihilation of air because it imparts to fire its
destructive agency.”
That approach is now under attack in the name, ironically, of
protecting speech and society.
Today’s factions run from political organizations to
corporations and labor unions to public interest groups having the
widest imaginable range of views. Many of these public interest
groups form alliances with economic entities that provide the
wherewithal for them to better advance their positions.
Such alliances are unavoidable because free speech isn’t free.
Someone must cover the costs of the speaker and the associated
costs of seeing that the speech is disseminated. Rich speakers can
cover these costs themselves. Some, like George Soros, have used
that path most creatively. The revival of modern liberalism owes
much to his willingness to use his vast wealth to resurrect liberal
ideas after the conservative triumphs over the last few decades.
Soros is an ideal example of an individual who garnered wealth as
an entrepreneur and now uses that wealth to foster the viewpoints
he favors, and the fortunes of those groups that espouse those
viewpoints.
Other wealthy individuals — although none at this scale — have
backed libertarian and conservative causes. And still other wealthy
individuals have created foundations that soon become forces
themselves. Many of those foundations often have strong views; some
support free markets, but most advocate expanded government
intervention in areas ranging from the environment to health care
to labor and product regulation. With that stance, it is not
surprising that many government agencies now fund “educational”
efforts by various factions (bureaucrats can be empire-builders and
act entrepreneurially too). The EPA, for example, has provided much
funding to ensure that the public views its role as critical.
BUT THE CURRENT FLURRY OF ASSAULTS has paid little attention to
special interest funding by government or individuals or
foundations. Rather, recent attempts to purify the policy world
have targeted conservative and free market groups. These so-called
reformers overlook the labor union connections to “fair-wage”
policy groups, and the trial lawyer connections to the Nader-style
regulatory advocacy groups. And they overlook the left-leaning
philanthropic foundations altogether. If they have their way, there
will only be two legitimate funding sources left: government and
foundations that support bigger government. If these are the rules
of engagement in the war of ideas, then capitalism’s prospects-in
the United States at least-are bleak indeed.
We should reject these skewed moral trip wires. They are not
even-handed guidelines, but rather the creation of mainstream
media, and their academic allies, advancing an anti-market
agenda.
Note that even that media itself must be funded. After all,
corporate advertisers are an important funding source for both PBS
and NPR, and media stars receive hefty speaking fees before
business conferences. But does anyone think that such financial
links have tempered the often anti-capitalist biases of these
outlets? (Why business would underwrite anti-market productions is,
perhaps, a more interesting question.)
In fact, it was on PBS that I was hit with a question on this
very topic. Bill Moyers asked me:
“How can we take you seriously when we know that the
Competitive Enterprise Institute is funded by… ExxonMobil, by
chemical companies, by tobacco companies, by corporations that have
an interest in getting you to say what you say?”
My answer:
“Because how do we take seriously National Public Radio
or public television or newspapers? All of those are supported by
advertisements that have economic interests in getting their
messages out. Corporations are part of [CEI’s] support [as are]
foundations and individuals. We accept support from [all] willing
to tolerate our independence, just like NPR is willing to accept
support from groups who are willing to tolerate their editorial
independence. We dance with these people. We’re not married to
these people. And we’ve taken positions that have lost us corporate
support and we undoubtedly will in the future.”
That distinction between working alliances and contractual mergers
captures, I believe, the uneasy but critical link between free
market public interest groups and the business community. Those
linkages must be strengthened — not threatened.
Conservative and libertarian groups are recent arrivals to the
factional wars that define America’s future. We’ve scored some
important victories in the war of ideas; moreover, the concept of a
“conservative intellectual” is no longer an oxymoron, if it ever
was.
Yet victory in the war of ideas is not enough to restore
America’s constitutional vision of a government strong enough to do
what is needed, while posing minimal threat to the economic and
civil liberties of the citizenry. That will require alliances among
all factions that have a stake in that alternative vision to
Leviathan. It must include entrepreneurs as well as
conservatives.
Conservatives must challenge liberal orthodoxy in the war of
ideas, but we should have no illusion that our intellectual
arguments will persuade many intellectuals. As the economist Joseph
Schumpeter noted long ago, the intellectuals’ envy of the
entrepreneur (if we’re so moral and smart, why are they so rich?),
coupled with the attraction of government power, will seduce these
elites into supporting an ever-expanding centralized government.
Thus, if economic liberals are to find allies, they must find them
in the business world.
Thus, it is clear why statists have embraced the proposition
that the only groups that business can legitimately sponsor are
those opposed to business. That is a premise that we should reject,
and reject proudly. Our groups should be doing more to lead
business away from the rent-seeking temptations of today’s overly
politicized world, to work with them to reduce the barriers that
limit their wealth-creating potential. And we must do this while
maintaining our integrity. We need to spend more time on the
political dance floor. It is critical that business understands and
respects our values and independence. It is equally important that
we understand the risks they take in opposing their regulatory
overseers, and the factors that lead them, too often, to seek
short-term political favors.
This is our challenge. Conservative groups and our nascent
business allies must find ways to improve the policies of the
highly compromised world of today, while developing economic
liberalization strategies that will ensure America’s future. The
real danger of the current attack is that one or both of us may
retreat, becoming wallflowers while the political dance moves
leftward.
Such a retreat would be a betrayal not only of the world the
Framers left for us, but of the world we will leave for our
children.
