Tuesday, October 5, 2010

Which party is more likely to be in bed with Wall Street? or, A plague on both your houses

Are Barack Obama's policies ruining business? Some of my Republican friends think so. So I was interested to learn about financial reporter Charles Gasparino's newly published book, Bought and Paid For: The Unholy Alliance Between Barack Obama and Wall Street. I haven't read the book, and I'm neither analyzing nor recommending it. Its thesis interests me, however. A few lines from Amazon's product review show where it's going:
Gasparino draws on interviews with dozens of key CEOs and political players to trace the roots of Wall Street's twisted love affair with one of the most liberal presidents in American history. He shows how, for decades, big banks and big business have colluded with big government, thereby laying the groundwork for today's shady dealings, and how the same bankers Obama now publicly reprimands have supported him--not because he promises change, but because he promises business.
That's scary, especially when read alongside a recent New York Times article about Republican Congressman John Boehner, likely to be the next Speaker of the House. In "A GOP Leader Tightly Bound to Lobbyists", Eric Lipton writes that Boehner
maintains especially tight ties with a circle of lobbyists and former aides representing some of the nation’s biggest businesses, including Goldman Sachs, Google, Citigroup, R. J. Reynolds, MillerCoors and UPS.They have contributed hundreds of thousands of dollars to his campaigns, provided him with rides on their corporate jets, socialized with him at luxury golf resorts and waterfront bashes and are now leading fund-raising efforts for his Boehner for Speaker campaign, which is soliciting checks of up to $37,800 each, the maximum allowed.
So who's helping business more, Democrats or Republicans? Seems to me that elected representatives of both parties need to wear the full-disclosure T-shirts I recommended last month.

Perhaps the answer is found not in PAC donations and lobbyists' influence, but in how individual states are faring. If a state is hospitable to business, won't that result in improved finances, better incomes, lower unemployment? And if so, shouldn't a state's political leanings have something to do with its financial soundness?

Yesterday the website 24/7 Wall Street published "The Best and Worst Run States in America: A Survey of All Fifty." The report's authors noted that "well-run states have a great deal in common with well-run corporations. Books are kept balanced. Investment is prudent. Debt is sustainable. Innovation is prized. Workers are well-chosen and well-trained. Executives are picked based on merit and not 'politics.'” Taking data from a host of surveys, they came up with a formula that ranked each state "giving weight to metrics that are most important to prudent governance."

In a wonky mood, I made myself an Excel chart showing the states' ranks. I then added columns listing each state's choice of presidential candidate in 2008, the party affiliation of each state's governor, and the party affiliations of each state's two senators. What I found is that a well-run state can be Democratic, Republican, or a mix. So can a poorly run state. Though it appears that Democrats may have a slight edge over Republicans in good governance, we who live in Illinois--solidly Democratic and #43 on the list--must be careful about throwing stones.

Next month's primary elections will likely shift power in the direction of the Republican party. Will a Republican win rescue business from destruction at the hands of Democrats?--or, looked at another way, will it sell a defenseless populace to greedy Wall Street types?

The answer to both questions is that the elections will probably make little difference, since Democrats seem to be in bed with business just as much as Republicans are. Will a power shift help to put the states on a more solid financial footing? Again, probably not, since party affiliation doesn't seem to have a lot to do with a state's financial soundness.

“We basically have two bankrupt parties bankrupting the country,” says Stanford University political scientist Larry Diamond. Thomas Friedman quotes him in a recent op-ed piece, "Third Party Rising." Here is Friedman's proposal:
We need a third party on the stage of the next presidential debate to look Americans in the eye and say: “These two parties are lying to you. They can’t tell you the truth because they are each trapped in decades of special interests. I am not going to tell you what you want to hear. I am going to tell you what you need to hear if we want to be the world’s leaders, not the new Romans.
Hear, hear.

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