February 27, 2012, Bob Brinker's Moneytalk Summary of Third-hour Guest Interview

 February 27, 2012.......................................................................(comments welcome)

Yesterday, Bob Brinker's Moneytalk guest-speaker was Lawrence Lessig author of Republic, Lost: How Money Corrupts Congress--and a Plan to Stop It  Published October 5, 2011 

Special guest writer, Frank J., wrote this summary of Lessig's third hour Moneytalk interview and the editorial comments:

Editorial comment in italics.

Lessig is a lawyer and professor of law at Harvard.

Bob Brinker (BB) introduced the author and then said that the issue of money and its corruption of politicians is one of the favorite topics on Moneytalk. He mentioned the “dysfunctionality” of Congress, and cited a caller from today’s program wanting to know how one is supposed to make financial plans with tax policy a moving target?

LL replied that the tax code is written to assist with the raising of campaign funds, and the uncertainty connected with the code is driven by a pursuit of campaign donations for members of the tax committee.

BB said the Simpson Bowles committee came to conclusions which were presented to the White House as a menu of recommendations, and as far a he knows, it went into the trash.

LL said the White House recognizes they are “blocked’ from making progress “in this cycle.” The system is distorted by the pursuit of campaign funds. No one can afford to alienate the donor base.

BB said, it sounds bleak, and asked, how does that change? LL said that is will only change through outside pressure: Congress enjoys too many benefits that result from the present system and they understand that their election success comes from the system in place. Lessig said the most critical divide in the country today is the Washington insiders versus everyone else.

Amen.

BB then, without naming him, cited the case of Jon Corzine, a former Goldman Sachs executive who left and “bought” himself a Senate seat, then a governorship, before going back to Wall Street …. Bob asked, with as many as 50% of the members of Congress being millionaires, is this what the founding fathers had in mind?

LL said that the founding fathers expected the members of Congress to be from the elite of society and have private wealth, but the problems we face come from members of Congress who have become beholden to big wealth. Private wealth among candidates is not so much the problem, the problem is the leveraging of enormous wealth (from contributors) to get into office.

BB said a lot of House members start raising money the day after their swearing in.

LL related his own story of when he was approached about running for Congressional office and was told by a potential campaign manager that he needed to agree to spend 2-4 hours every day, making calls to raise money. Lessig allowed as how that is a skill some people have, but it does not necessarily go along with the judgment of what is in the public’s interest.

BB was astounded at the time commitment Lessig mentioned, and referred to the fund raising requirement as “beyond the pale.”

BB asked the guest, “Who would want to do this? (raise that kind of money?).

LL delivered the punch line to Bob’s setup: “Well there are 535 of them. And another 535 running against them.”

EC: Good laugh line – but don’t forget the 2 in the White House and the current Republican candidates.

BB stated that we get the best government money can buy. Something he says often on the show, and is correct about.

LL agreed and said, with regard to members of Congress, “you begin to recognize what you need to do to raise the money you need to raise.”

BB: Where does this leave the typical American?

LL: It leaves them shut out. Some members of Congress have said explicitly how much money it would take to get a meeting.

Before the half hour break, BB said, “Its all about the money,” referring to Congress.

After the break, BB asked LL how do we fix this? Lessig said that right now, 0.26% give more than $200 to Congressional campaigns and a smaller percentage, 0.05% “max out” on Congressional campaigns.

He described his solution, a “democracy voucher,” which would be the first $50 of any tax owed by a taxpayer. Those receiving the democracy voucher could sign this over to the candidate of their choice, who could also pledge to take cash contributions limited to a maximum of $100. Lessig cited some states, Connecticut, Maine, Arizona that have done this for state elections.

Bob seemed unconvinced and said many are satisfied with the status quo, and asked again, how do you change this?

Lessig said it would take enormous pressure and mentioned the “Move On” group, the Tea Party groups and the “Occupy” groups as organizations who may have much different political agendas, but (should) have common goals when it comes to cleaning up campaign finance. Neither group will get what they want until the campaign finance problem is solved.

Bob asked if partisanship has ever been greater than it is now? Lessig agreed and said it is due to extremism on both sides, caused by the need for the “frenetic search for money” leading to extremism as a more effective way to raise cash.

With regard to Bob’s question about partisanship and whether it has ever been greater… I don’t want to Go Literary on everyone here, but there was a certain novel about the French Revolution, A Tale of Two Cities, which started with the sentence: “It was the best of times, it was the worst of times.” The point is, there may be a tendency in society to view the current times, in the extremes, either the best, (iPads, cell phones, PCs and the internet) or the worst, (a dysfunctional Congress and $5.00 gas on the way).

Today’s political climate may seem like “the worst of times,” to some, but in our nation’s history, there have certainly been times that were more polarizing. For example, there is the part of our past from 1861 to 1865 known as the Civil War, (also known, to this day, as the War of Northern Aggression in many southern states.)

Sometimes doing nothing is the preferred alternative and Bob has said before on the program that gridlock is good in Washington, DC.

Phone calls:

Harry from South Lake Tahoe read the book and proffered a solution, namely term limits of one 6 year Senate term and 2 terms (4 years) in the House. Lessig shot this idea down, stating that he is not opposed to term limits, but term limits alone would simply place more power in the hands of the lobbyists because it takes some time in Congress before you know what you’re doing.

Bob followed up with a question about what prevents people from spending the equivalent of a working lifetime in Congress? Lessig did not directly answer the question, but stated that Jim Cooper, a Democrat from Tennessee told him that to some members, Congress serves as a farm team for the lobby industry. Members hope to serve 2 to 3 terms and then move on to lobbying jobs.

Bob referred to the “awesome power of incumbency” and asked Lessig to comment. His response was something that has been mentioned previously on this blog: gerrymandering, which is the adjustment of Congressional district boundaries that all but guarantee a victory for the incumbent. According to the guest, in many districts, incumbents fear primary challenges from a member of their own party, more than a race against the opposing party. Lessig believes this encourages polarization because the incumbent tends to adopt more extreme positions to counter those of the opponent from his/her own party.

Caller Susan from Illinois --- dropped off the line, missed her chance.

Keith from Rochester, a caller “of Vietnam age” and a Tea Partier, as he described himself, gave a short speech and then took Lessig to task for implying that Tea Partiers and Occupiers could not work together.

This is not what Lessig said earlier.

And, he asked whether former President Bush, and President Obama had a secret agreement that Wall Street criminals would not be prosecuted.

With regard to the “secret agreement” question, Lessig’s answer was “I don’t know about a secret deal,” and he went on to agree that the lack of aggressive prosecution was outrageous. He added that Bush and Obama were trapped and felt they needed the same guys (the Wall Street crowd) to help solve the crisis, and it would be wrong to get their help and then turn around and prosecute them.

Editorial comment: What we have learned in the fullness of time is that Wall Street needed the government’s help much more than the government needed Wall Street’s help.

In answer to Keith’s question about the Occupiers and the Tea Party, Lessig reiterated that they have a common interest in getting rid of the kind of corruption that is big money inside the political system, even though their political agendas differ.

More editorial comment: I agree with Lessig, but add that the money sloshing around Washington DC should be a concern for everyone, not just Occupiers and Tea Party members. The “system” in place now, disenfranchises all, except for those who can contribute enough to get on their Congressional representative’s radar screen.

And when it comes to the Senate … fuggetabboudit … like the potential yacht buyer, if you have to ask what it costs, you can’t afford one.

The last caller was Jimmy from Portland, Oregon who was “encouraged but discouraged,” and believed that “until you change the hearts of men…” His point was, we are fighting an uphill battle with regard to campaign finance reform and Congress will not come around on their own.

Lessig agreed with the caller and said that the framers of the Constitution created a government for ordinary men. If we make changes to the way we fund elections, then it is possible to imagine government focusing in a way that , will give ordinary people the ability to believe in government again (paraphrasing him here). He went on to cite the success President Reagan and Speaker O’Neill had in revising the tax code in 1986. The implication was, such success would be impossible today, given the extremism on both sides."

Honey here: Frank J., thank you so much for that outstanding summary!! Sometimes I don't listen to the third-hour guest so I can begin writing my show summary,  but I did listen to Lessig because he was very interesting, in my opinion. 

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