Harvard Law Professor Lawrence Lessig expounds on what has become of this Republic. There is much more to this presentation than what is contained in the selected notes below. Please watch/listen to it in its entirety (embedded below).
There are a thousand hacking at the branches of evil, to one who is striking at the roots. Henry David Thoreau, 1846
On American Greatness: There is a feeling today among Americans that we might not make it. The feeling of inevitability of American greatness is gone… that we have becomeBritain orRome orGreece. A generation ago, Reagan rallied the nation to deny a similar charge by Jimmy Carter. Reagan was right. But it is different today. Not that we as a people have lost anything of our potential. But we as a Republic have.
On America’s ability to govern: Our capacity for governing seems to have come to an end. The thing we were once most proud of, our Republic, is what we have learned to ignore. Government is an embarrassment. It has lost the capacity to make the most essential decisions. A ship that cannot be steered is a ship that will sink. This is a multiparty frustration. Left and right. As policies get systematically blocked, we must seek out the Thoreauvian root skill.
An example of how lobby money leads to bad law: Bill Clinton signed the Sonny Bono Copyright Term Extension Act in 1998, extending the term of existing copyrights by 20 years. Congress must have asked itself, “Did it advance the public good?” Copyrights are supposed to work by giving incentives to creating work. Incentives are prospective. Extending existing copyright terms does not produce additional work. The work had already been created. Milton Friedman said he would only join the brief (against the Act) if it had the term “no brainer” in it. Congress unanimously extended the term. There was more than $6m in lobby money from Disney and related companies. Public good be damned.
On the Wall Street Collapse: According to Simon Johnson and James Kwak, what explains the collapse is a perverse mix of too little government and too much government. Too little governmentt in the form of deregulation. In the 1990’s, financial innovators produced new financial instruments – namely derivatives. Those innovations were invisible to the market because a series of regulatory changes made it so that they did not have to satisfy standard exchange-based rules that had existed for decades: that they be traded on a public exchange; transparent; and subject to anti- fraud requirements. In the 1980’s, 98% of trades were subject to those New Deal rules. By 2008, 90% of trades were part of the shadow-banking economy.
Johnson & Kwak argue there was also too much government. Throughout the 90’s they sent a clear message that there was an implicit government guarantee. We socialized the risk and privatized the upside.What we got was the dumbest form of socialism in history. This is an insanely stupid way to set up financial markets.
On what transpired after the crisis hit in 2008: It gets worse after 2008. Wall Street still had the power to blackmail Congress into giving them a get out of jail free card. They managed to prevent change to the basic architecture that led to the instability that brought our economy over the cliff. We went from “Too Big to Fail” to “Too Bigger to Fail”, because of the “financial reform” that we have passed since 2008.
On why we are unable to regulate sensibly in this context: Since the 1990’s the fastest growing sector for campaign donations has been the financial sector. It all comes down to campaign contributions. Finance and insurance companies are the biggest donors. Money buys results in congress.
On what it means for Americans: No respectable liberal, conservative, or libertarian could defend these practices. These are abominations. The belief that we have a bought Congress erodes trust and participation. Recent polls indicate that ~9% of Americans have confidence in Congress.
On who Congress works for: The people are no longer the intended beneficiaries of government. And government is no longer dependent upon the people. Government is dependent upon their benefactors. They spend 30% to 70% of their time thinking about how to raise money. They become shape-shifters. They are constantly aware of what will bring in money. In 2010, 0.05% of Americans maxed out on campaign contributions. This is legalized corruption. It is a corruption of the dependence our framers intended. We have the wrong dependence inside the core of Congress.
Oh what constitutes a Republic: A Republic is a Representative Democracy. It is a democracy with a branch dependent on the people alone. We have lost that.
On what money does to the legislative process: One quoted study indicates that there is a vast discrepancy between what Congress does and what the vast majority of the population desires. Congress consistently does what the wealthiest desire.
On what we need now: Public funding of campaigns.
On why public funding of campaigns is so difficult to achieve: The problem is that Capitol Hill has become a farm league for K Street. Members and staffers and bureaucrats have a long-term view of eventually becoming lobbyists. It is a system where everybody depends on the current corrupt system surviving. Congress is not going to legislate against the system they have an interest in sustaining.
On what the alternative is: We must find ways to get around the cancer at the center of our government. Ordinary means are not appropriate. We need active, engaged politics. We must reclaim governing away from the professional politicians. It may not be possible.
On how to proceed: We must find common ground. We must become Thoreauvian root strikers. We must have courage.
Link to Lawrence Lessig’s book: Republic, Lost: How Money Corrupts Congress – and a Plan to Stop It
Link to original post at Blip.tv: Republic, Lost