Wednesday, January 11, 2006

Wisdom from William Greider

From his recent book, The Soul of Capitalism:

The modern American state—encompassing governance at the local, state, and national levels—has lost the capacity to distinguish between public works and private gain. And this failure has profound consequences for the society that are far more destructive than the obvious symptoms of corruption involving money and politics. Over many years, the two parallel purposes—public benefit and private returns—have become steadily fused by the crude logic holding that whatever helps the advance of enterprise may be regarded as beneficial for the general public too. The meaning of public value is thus so adulterated, government is effectively relieved of strong guiding principles. It acts promiscuously on behalf of seemingly random demands and threats.

The public decisions on how to dispense money or preferences thus have become confused or, less charitably, deranged. And government begins to resemble a house of indulgences, dispensing favors and forgivenesses, rationalized by arcane economic calculations but driven more often, as everyone understands, by raw political favoritism. Among other consequences, the government itself thereby promotes inequality, since the distribution of public awards closely follows the misalignments of wealth and influence already existing in society.

These practices are enormously wasteful—hundreds of billions in public resources converted to private gain—but wasted money is the least of the consequences. Nor is this another futile lament against the tyranny of special interests. In a democracy, one man's idea of "special interest" is always another man's righteous cause…We accept the persistence of excess and error in the contract for self-government, so long as the governed retain the power to correct the errors.

The confusion of governing purpose has far more damaging consequences, however. Government loses its ability to envision the broader, long-term story of society's permanent interests. Its potential power to alter the shared future of the country is forfeited to immediate commercial needs, farsightedness vetoed by the here and now…

In these terms, the federal government has become strangely weak, notwithstanding its size and awesome powers. Pulled this way and that, yet incapable of taking big leaps forward, government seems confused about its original purpose or, if you prefer, corrupted by its allegiance to capitalism's needs. This incapacity, I suspect, has contributed greatly to the weakened public faith in government. People harbor contradictory complaints and may not grasp the intricacies, but they do know the benefits are not aimed their way.

In essence, the governing system has become a reactionary influence in the generic meaning—backward looking. It works hardest to support the old over the new, to sustain the status quo created in the past, to defend "what is" against "what might be." In theory, government at every level is not opposed to innovation and small, innovative enterprises or to many larger changes sought by social reformers. As a practical matter, however, government usually takes its stand with the very large and well-established business organizations. Generally, it wants what they want. On major matters, it is most reluctant to do anything they oppose. The political objective we explore in this chapter is nothing less than relearning the meaning of "public works." I am anxious to revive a principled understanding of how government and capitalism are meant to interact in order to restore strong governing principles that not only include society's interests but that serve society first.