Our Federal Government: Still for Sale





Mr. Schocket is an assistant professor of history at Bowling Green State University and a writer for the History News Service.

There's bad news and worse news about American politics. The bad news is that Congress and the president are selling out the federal government to corporate bigwigs. The worse news is that the sale may last a long time.

Once upon a time, corporate executives bought politicians by stuffing their pockets with cash, land or corporate stock. Such bribery was widespread in the late nineteenth century. More recently, few members of Congress have been caught taking bribes. Before Rep. James Traficant of Ohio was convicted this summer of getting his palms greased, the last serious accusation of bribery had occurred in 1980 when the FBI's Abscam sting operation implicated seven members of Congress.

But don't be fooled. Both the president and nearly every member of Congress are on the take. Nowadays, executives and politicians don't need to risk jail time because they have exchanged money for votes. In this TV age, campaigning is expensive business. Today's bribes come in the form of enormous but legal campaign contributions, which everybody in Washington knows but will not admit.

For a long time in the nation's history -- from the 1860s to the 1910s -- the selling of the government was even more brazen than it is now. Mining and logging companies gained nearly free rein to scar and pollute federal property -- as they do to this day. Railroad companies boldly bought congressional votes for huge federal land grants, in the form of gifts of land along the routes of the tracks. Favors for money = government for sale.

Today's politicians may deny it, but they are no cleaner than yesterday's. This June, the Republican Party hosted a fundraiser, that 21 corporate donors -- mostly pharmaceutical corporations -- paid $250,000 each to attend. The event came two days after Republicans unveiled a prescription drug plan written by the drug companies. The Energy and Commerce Committee even cut short its own meeting so that members could attend the dinner. Votes for money = government for sale.

Democrats are no better. In the 2000 election, high-tech companies poured out $40 million in campaign contributions, mostly to Democrats. This July, high-tech industry lobbyists defeated a bill that would have made stock options a corporate expense – a reform designed to help curb the kind of corporate abuse that did in Enron. Just as a nineteenth-century tycoon might have warned his government hirelings, one computer-industry lobbyist informed Democratic senators that he will keep score on how each one votes. The scores will be used to determine who gets campaign contributions next time. Money for votes = government for sale.

In the late nineteenth century, the presidency was up for sale, too. Big business leaders called on presidents to use the national guard and even regular army units to put down strikes -- a vicious kind of corporate downsizing. Then as now, phone call to the White House was easier than paying employees decent wages. Army for hire = government for sale.

Nor is today's White House exempt. Like his late-nineteenth-century predecessors, President Bush coddles the big businesses that contributed so much to his election. Last December, the Bush administration offered an amnesty to corporate tax evaders. An IRS official said that it was unfair to make bandit corporations that are caught pay their back taxes and penalties, while those that don't get caught get off. By that reasoning, if a mob killer offers enough in campaign contributions, he can avoid federal prosecution as long as someone, somewhere has gotten away with murder. Money for a free pass = government for sale.

What ended the first government sale? Republicans and Democrats alike responded to the growing rage of their constituents. Presidents Theodore Roosevelt and Taft and courageous legislators passed reforms limiting the political influence of corporations. But judging from the huge loopholes in the recently passed campaign finance law, today's politicians aren't up to the task.

During World War I President Wilson leaned hard on executives to restrain their greed, for the good of the war effort. But even during President Bush's war on terrorism (and despite his recent get-tough speeches), he has continued to sell out rather than close up shop. A hundred years ago, muckraking reporters exposed the scratch-my-back-and-I'll-scratch-yours behavior of corporations and politicians. But today's media -- and today's audiences -- are more interested in tawdry sex scandals than in political payoffs.

That first government sale ended after half a century of corporations freely exploiting working people, cheating consumers, swindling stockholders, looting the federal treasury, crushing competitors and raping the environment -- a sordid list that looks strikingly similar to headlines that now appear almost daily. The question now is not whether the nation has entered into another government sale, but how long it will last -- and what will be left when the sale is finally over.


This piece was distributed for non-exclusive use by the History News Service, an informal syndicate of professional historians who seek to improve the public's understanding of current events by setting these events in their historical contexts. The article may be republished as long as both the author and the History News Service are clearly credited.


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Dr. John L. Godwin - 9/6/2002

Dear HNN:
I would like to consider reprinting the above article by A. Schocket. It is a very effective piece and will help people here to understand the current crisis in government.
I am the editor and publisher of a small progressive tabloid operation. We are called The People's Civic Record- dedicated to a vision of progressive politics, the humanities and human rights.
We may use this piece for our October issue. We distribute a free "street tabloid" across a five county area here in the Wilmington, N.C. area.
Don't know yet if we will actually use this.
John L. Godwin
Editor & Publisher


TJ Orson Olson - 8/22/2002

"The bad news is that Congress and the president are selling out the federal government to corporate bigwigs. The worse news is that the sale may last a long time."

Professor Schocket may choose to believe this, but my textbook,
Amwerican Governemnt, by James Q. Wilson (1995), was unable to verify this populist theory; nor was a recent issue of the Journal of Policy History.

But the Professor is undetered in finding evil in our government:
"But don't be fooled. Both the president and nearly every member of Congress are on the take. Nowadays, executives and politicians don't need to risk jail time because they have exchanged money for votes. In this TV age, campaigning is expensive business. Today's bribes come in the form of enormous but legal campaign contributions, which everybody in Washington knows but will not admit."

"[E]normous but legal campaign contributions" are your evidence?
If they are, then when an elected representative is relieved of the necessity of gaining campaign contritbutions, as when Congresspeople and Senators retire, their TRUE colors, those of their conscience, should be evident, rather than their contributers--right?

John Lott of Yale Law School has studied this subject himself (and lasty time I looked had links to his work available there), and he finds no such evidence...

"This July, high-tech industry lobbyists defeated a bill that would have made stock options a corporate expense – a reform designed to help curb the kind of corporate abuse that did in Enron." Which seems like such a sensible reform. Sancta Simplicitus! But as Larry Kudlow, among others, have explained--contrary to Paul Krugman or Warren Buffet--such a simple "solution" does not follow. In fact there are myriad valuation problems with it. And besides, none of the corporate problems "like Enron" have occured in old-line businesses, but rather in budding new ones (hi-tech, or "energy trading" like Enron), where both problems of attracting top talent to start-ups as well as valuing the worth os a new industry itself are at stake! Or would you rather keep the many many millionaires, who make the new industries go, in HP or Microsoft from being rewarded in the first place? If so, say farewell to the 90s boom; many wil ask "just what are you saving us from?"

Irony: Microsoft practically NEVER gave money to the DC trough--i.e., they had no lobbyist--until the government's antitrust attack--now they have a full-time DC office! REALITY: Government is THE problem, not the solution!

BUT perhaps we have "an invisible gardner who tends this plot?"
as Antony Flew's famous "Theology and Falsification" essay has it; perhaps Schocket can save his thesis from the slings of a thousand qualifications, unlike Flew's (or John Wisdom's, from whom the parable first sprang) poor contrary explorer! But I'm not holding my breath.

Your "corporate corruption" thesis is more unfalsifiable religious belief than sound sense.

--T. J. Orson Olson
(Anarchist)



Allen Campbell - 8/15/2002

Like all sales this one will and must end. My only concern is who is going to turn off the light when its' over. That is providing there is both a light and electricity left to turn off.


thesafesurfer - 8/15/2002

The sale of government didn't miss a beat between the nineteenth and twentieth centuries. Look at who ran war production during both World Wars, corporate big wigs, and the rise fo the military industrial complex during the Cold War. The author is a bit naive to claim the "first government sale ended." It never has and probably never will.