"Ain't Gonna Study War No More"

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Right-To-Life Party, Christian, Anti-War, Pro-Life, Bible Fundamentalist, Egalitarian, Libertarian Left

Monday, January 16, 2006

If You Don't Know K Street

You Don't Know Jack

To understand the culture of corruption that infects Washington, DC, it's important to understand the origins of the K Street Project.

In 1994, the right wing gained control over the House of Representatives on the strength of a series of reforms embodied in the so-called "Contract with America." The contract ostensibly "aimed to restore the faith and trust of the American people in their government" and end the "cycle of scandal and disgrace" in government. A year later, then-Majority Whip Tom DeLay (R-TX) was already plotting to breach that contract by undertaking a project to develop cozier relations with Washington, D.C. lobbyists.
High-minded policy goals would take a backseat in DeLay's pay-to-play system where the success of lobbyists would be dictated not by how compelling a case they could make, but rather by how willing they would be to line the pockets of DeLay and his colleagues. Conceptualized as a tool for the right-wing preservation of power, the "K Street Strategy," as it became known, created the culture in which Jack Abramoff's criminal activity was encouraged and rewarded.

HOW THE K STREET PROJECT WORKED: In his dealings with K Street lobbyists, DeLay explicitly stated he would operate by "the old adage of punish your enemies and reward your friends." (To gain influence over legislation, trade associations and corporate lobbyists were ordered to do three things: 1) refuse to hire Democrats, 2) hire only deserving Republicans as identified by the congressional leadership, and 3) contribute heavily to Republican coffers.) Despite being admonished by the House Ethics Committee numerous times for his conduct, DeLay's pay-to-play machine continued to plow full-speed ahead. With federal benefits up for sale, corporations quickly identified the need to need to hire more lobbyists, giving rise to one of the greatest growth industries in America. Grover Norquist, head of Americans for Tax Reform, proudly proclaimed in 2002 that [conservatives] "will have 90-10 [percentage advantage in staffing] on K Street and 90-10 business giving."

IDEAS TOOK A BACKSEAT: Lost in the pay-to-play system is any concern for good governance. The Wall Street Journal recently editorialized, the real problem "isn't about lobbyists so much as it is the atrophying of its principles. As their years in power have stretched on, House Republicans have become more passionate about retaining power than in using that power to change or limit the federal government. Gathering votes for serious policy is difficult and tends to divide a majority. Re-election unites them, however, so the leadership has gradually settled for raising money on K Street and satisfying Beltway interest groups to sustain their incumbency. This strategy has maintained a narrow majority, but at the cost of doing anything substantial. ... Ideas are an afterthought, when they aren't an inconvenience."

IMBALANCE OF POWER: The K Street scheme had a dramatic influence on policy. While it is well-recognized that business interests profited from the K Street Strategy, less attention is paid to those who lost out. As Michael Crowley, a writer for The New Republic, recently noted on C-Span, "In times like these when we have a budget crunch, it's not subsidies for corporations or tax loopholes that go; it's Medicaid and aid and health care for low-income disadvantaged people who don't really have lobbies in Washington with the clout equivalent to some of America's biggest corporations."

The last few months of Congress are a testament to that fact. In the name of cutting federal spending, Congress recently proposed a budget trimming Medicaid funding, federal child-support enforcement, and student loans to save $40 billion. But the right wing quickly turned around and distributed these savings back out in the form of business-friendly tax cuts.

A SYSTEM MADE FOR ABRAMOFF: Jack Abramoff was "closely associated with the K Street Project." In fact, the system was a perfect fit for Abramoff, given his stated desire to shun low-paying political activist work in favor of striking it rich. "I wanted to make money," he said.

A former chairman of the College Republican National Committee, Abramoff decided that his connections in the conservative movement could help him at a time when Republicans were rising to power in Washington. Abramoff developed a motley crew of right-wing allies, including anti-tax crusader Grover Norquist, Christian right-wing leader Ralph Reed, and a host of conservative lawmakers. "He is someone on our side,'' said DeLay chief of staff Ed Buckham. "He has access to DeLay." And Abramoff played the game as DeLay wanted it played. By securing clients with deep pockets and federal legislative interests, Abramoff was able to contribute heavily to Republican leaders (raising at least $120,000 for the 2004 Bush campaign).

What eventually brought Abramoff down was how audaciously he worked the system. He now concedes that he illegally "offered and provided a stream of things of value to public officials in exchange for official acts and influence and agreements to provide official action and influence." In return for legislative and personal favors, the things of value he provided to lawmakers included "foreign and domestic travel, golf fees, frequent meals, entertainment, election support for candidates for government office, employment for relatives of officials and campaign contributions."

RAMPANT ABUSE OF POWER: New York Times columnist David Brooks explained "the real problem wasn't DeLay, it was DeLayism, the whole culture that merged K Street with the Hill, and held that raising money is the most important way to contribute to the team." The culture permeated the entire congressional leadership; they were willing buyers of what lobbyists were selling. "We simply have too much power," said Rep. Jeff Flake (R-AZ), speaking of lawmakers' ability to target tax dollars for particular projects, contractors or campaign donors.

The current race for the majority leader post left vacant by DeLay reveals the far-reaching impact of the K Street culture. Rep. Roy Blunt (R-MO) shared connections to Abramoff and has taken other actions to benefit corporate lobbyists. Rep. John Boehner (R-OH) "has strong connections to lobbyists: He met weekly with leading lobbyists to enlist their support and discuss strategy during his four years as House Republican Conference chairman, from 1995 to 1998." Very few of the congressmen who have been in positions of power over the last decade have clean hands. Many of them share the pay-to-play values of Tom DeLay and the K Street ideology of Jack Abramoff.

The Progress Report

Thanks To Dubya, Inc.

America's Days As A Superpower Are Over

President George W. Bush has destroyed America's economy, along with America's reputation as a truthful, compassionate, peace-loving nation that values civil liberties and human rights.

Nobel Prize-winning economist Joseph Stiglitz and Harvard University budget expert Linda Bilmes have calculated the cost to Americans of Bush's Iraq war to be between $1 trillion and $2 trillion. This figure is five to 10 times higher than the $200 billion Bush's economic adviser Larry Lindsey estimated.

Lindsey was fired by Bush because his estimate was three times higher than the $70 billion figure that the Bush administration used to mislead Congress and the American voters about the burden of the war. You can't work in the Bush administration unless you are willing to lie for Dub-ya.

Americans need to ask themselves if the White House is in competent hands when a $70 billion war becomes a $2 trillion war. Bush sold his war by understating its cost by a factor of 28.57. Any financial officer anywhere in the world whose project was 2,857 percent over budget would instantly be fired for utter incompetence.

Bush's war cost almost 30 times more than he said it would because the moronic neoconservatives that he stupidly appointed to policy positions told him the invasion would be a cakewalk. Neocons promised minimal U.S. casualties. Iraq already has cost 2,200 dead Americans and 16,000 seriously wounded - and Bush's war is not over yet. The cost of lifetime care and disability payments for the thousands of U.S. troops who have suffered brain and spinal damage was not part of the unrealistic rosy picture that Bush painted.

Stiglitz's $2 trillion estimate is OK as far as it goes. But it doesn't go far enough. My own estimate is a multiple of Stiglitz's.

Stiglitz correctly includes the cost of lifetime care of the wounded, the economic value of destroyed and lost lives, and the opportunity cost of the resources diverted to war destruction. What he leaves out is the war's diversion of the nation's attention away from the ongoing erosion of the U.S. economy. War and the accompanying domestic police state have filled the attention span of Americans and their government. Meanwhile, the U.S. economy has been rapidly deteriorating.

In 2005, for the first time on record, consumer, business and government spending exceeded the total income of the country.

America can consume more than it produces only if foreigners supply the difference. China recently announced that it intends to diversify its foreign exchange holdings away from the U.S. dollar. If this is not merely a threat in order to extort even more concessions from Bush, Americans' ability to consume will be brought up short by a fall in the dollar's value, as China ceases to be a sponge that is absorbing an excessive outpouring of dollars. Oil-producing countries might follow China's lead.

Now that Americans are dependent on imports for their clothing, manufactured goods, and even high technology products, a decline in the dollar's value will make all these products much more expensive. American living standards, which have been treading water, will sink.

A decline in living standards is an enormous cost and will make existing debt burdens unbearable. Stiglitz did not include this cost in his estimate.

Even more serious is the war's diversion of attention from the disappearance of middle-class jobs for university graduates. The ladders of upward mobility are being rapidly dismantled by offshore production for U.S. markets, job outsourcing and importation of foreign professionals on work visas. In almost every U.S. corporation, U.S. employees are being dismissed and replaced by foreigners who work for lower pay. Even American public school teachers and hospital nurses are being replaced by foreigners imported on work visas.

The American Dream has become a nightmare for college graduates who cannot find meaningful work.

This fact is made abundantly clear from the payroll jobs data over the past five years. December's numbers, released on Jan. 6, show the same pattern that I have reported each month for years. Under pressure from offshore outsourcing, the U.S. economy only creates low-productivity jobs in low-pay domestic services.

Only a paltry number of private sector jobs were created - 94,000. Of these 94,000 jobs, 35,800 - or 38 percent - are for waitresses and bartenders. Health care and social assistance account for 28 percent of the new jobs, and temporary workers account for 10 percent. These three categories of low-tech, nontradable domestic services account for 76 percent of the new jobs. This is the jobs pattern of a poor Third World economy that consumes more than it produces.

America's so-called First World superpower economy was only able to create in December a measly 12,000 jobs in goods-producing industries, of which 77 percent are accounted for by wood products and fabricated metal products - the furniture and roofing metal of the housing boom that has now come to an end. U.S. employment declined in machinery, electronic instruments, and motor vehicles and parts.

Two thousand six hundred jobs were created in computer systems design and related services, depressing news for the several hundred thousand unemployed American computer and software engineers.

When manufacturing leaves a country, engineering, R&D and innovation rapidly follow. Now that outsourcing has killed employment opportunities for U.S. citizens and even General Motors and Ford are failing, U.S. economic growth depends on how much longer the rest of the world will absorb our debt and finance our consumption.

How much longer will it be before "the world's only remaining superpower" is universally acknowledged as a debt-ridden, hollowed-out economy desperately in need of IMF bailout?

Creators Syndicate
Jan 12, 2006
Paul Craig Roberts, senior research fellow at the Hoover Institution at Stanford University, writes for Creators Syndicate.