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    The Inaugural: Corporate Money and Government Favors

    01/21/2013

    In Federalist Paper Number 10, James Madison addressed the universal problem of special-interest politics:

    By a faction (interest group), I understand 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, adversed to the rights of other citizens, or to the permanent and aggregate interests of the community.

    The Inaugural:  Corporate Money and Government Favors

    Money dominates politics.  It takes great amounts of money to win an election and even more money to be the majority party.  Remember, being in the majority means controlling policy and process.  Of course, it takes even more money to win the Presidency.  All of these are reasons why big unions, big corporations,  and powerful special-interest groups invest enormous amounts of money in politicians and their parties.   Their strong expectation is to receive greater returns from a politician's political cronies.

    One prime example are the great tax breaks bestowed in the year-end “fiscal cliff deal.”  It was widely reported that the White House told Harry Reid (D-NV) to extend tax credits to GE and other friendly donors.  Low-and-behold, crammed into the bill were breaks for major corporations, Hollywood film producers, green energy and a plethora of the President's friends.  [Joshua Withrow wrote an excellent accounting of the billions of dollars of loopholes for big businesses.]

    The second Inauguration of President Obama is an occasion for corporate America to give more money to the Inauguration Committee, which, in reality, is giving money to the President. 

    How much will the Inaugural cost?  The committee would like to raise $50 million.  Most of this money will come from special-interest groups, which will consist mostly of big corporations.  Bluntly, these corporations are building “goody points” with President Obama and his administration.  Later, when these corporations need a favor, they will have a token to cash-in on a special favor.  Invariably, when government and a corporation (or any other special-interest group) collude,  it is to the detriment of the rest of society.

    Horribly, this collusion between politicians and special-interest groups has become an enormous enterprise. The following are five corporations and the army of lobbyists seeking special tax and regulatory favors, as researched by The Center for Public Integrity

    Chief among corporate inaugural donors: AT&T Inc., Microsoft Corp., energy giant Southern Co., biotechnology firm Genentech and health plan manager Centene Corp. Together, more than 300 registered lobbyists worked on the five companies’ behalf to influence legislation and government policy, according to their latest federal filings covering January through September.

    In return, our government bestows great benefits to these corporations:

    Among numerous other influence efforts, Southern Co. lobbied the Executive Office of the President to curtail environmental regulations. AT&T pressed the Treasury Department to extend research and development tax credits and lobbied heavily — and unsuccessfully — to win regulatory approval of a merger with rival T-Mobile. Microsoft targeted the Justice Department, Federal Communications Commission and U.S. Copyright Office for support in strengthening online piracy and intellectual property regulations.

    Obviously, this system of collusion between the financially powerful and political powers is fraught with various forms of corruption and is not in the best interest of society or individual Americans.  It is exactly what James Madison intended to prevent. In Federalist Paper Number 10, Madison addressed the universal problem of special-interest politics:

    By a faction (interest group), I understand 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, adversed to the rights of other citizens, or to the permanent and aggregate interests of the community.

    Benjamin Franklin cogently defined the universal corruption of special-interest groups and complicit politicians.  Unable to attend a session of the Constitutional Convention, Franklin sent the following letter:

    There will always be a party for giving more to the rulers, that the rulers may be able in return to give more to them. Hence as all history informs us, there has been in every State & Kingdom, a constant kind of warfare between the governing & governed: the one striving to obtain more for its support, and the other to pay less. And this has alone occasioned great convulsions, actual civil wars, ending either in dethroning of the Princes, or enslaving of the people. Generally indeed the ruling power carries its point, the revenues of princes constantly increasing, and we see that they are never satisfied, but always in want of more.

    America's founders were uniquely educated and eager to prevent the connivance between politicians and factions (special-interest groups). 

    Madison, seeking to stop the menace of factions, proffered that representative government, because of the diverse interest of professions and regions, would prevent coalescence from being a force in the federal government. Madison opined that America’s elected representatives would “discern the true interest of their country.” Unfortunately, Madison was ultimately wrong, special-interest politics is a major destructive force to honest and responsible governance.

    Today, America must seek a means to stop the corrupting influence of politicians and special-interest predators.  First, America must recognize the problem.  Fortunately, it appears that more and more Americans sense the corruption.  However, more need to know the magnitude. 

    Next, similar to the political philosophies and structures by our Founders, Americans must seek the restraints to force politicians and special-interest groups from further destroying the greatest political system ever institutionalized.  An honest discussion on governing structures and restraints is of paramount importance.