Monday, March 12, 2012

On Keystone XL and Political Corruption More Generally

A Gallup poll conducted in 2010 asked respondents to summarize their impression of the federal government, and over 70% indicated that they viewed the government as either corrupt or dysfunctional. They used words like bankrupt, broken, crooked, dishonest, and evil.  On the bright side, this is one issue where Americans can agree, be they Democrats or Republicans, young or old, black or white, Southern or Northern.  

To understand why the perception of corruption has not led to corrective action, the Keystone XL pipeline provides a timely and illustrative example. First, it is necessary to review the basic facts. The pipeline will traverse about 2000 miles, snaking its way from Hardesty, Alberta to refineries in coastal Texas. It is a project sponsored by a foreign interest called TransCanada.

Secondly, despite claims to the contrary, the project will not reduce America’s dependence on foreign oil and it will not reduce the price of oil. The oil is destined to arrive at a Saudi-owned refinery. When they testified at a Canada National Energy Board meeting, TransCanada representatives testified that the oil is intended for overseas export. They also mentioned that the price of oil in the Midwest is lower than they’d prefer owing to the oversupply of Canadian oil that is already flowing into these states. Therefore, it makes good business sense to sell the oil abroad where it can fetch a higher price. And, by reducing the supply of oil that is going to the Midwest, they will be able to command higher prices there as well.[1]
Thirdly, and despite claims to the contrary, the project will have a cost for taxpayers. Keystone XL will receive generous tax breaks. Also, when the oil reaches Texas, it will enter a Foreign Trade Zone; taxes will not be collected when the oil is imported to Texas, nor will taxes be collected when the oil is exported. This lost opportunity for revenue will mean that members of Congress will have to look elsewhere, and this is ominous news for taxpayers. 

Lastly, the members of government who are most enthusiastic when touting the benefits of the project are TransCanada stockholders. Representative Michael McCaul owned between $150,000 and $300,000 of stock when he wrote a letter to Secretary of State Hillary Clinton urging her to throw her support behind the project.[2] The State Department is responsible for approving the project. Meanwhile, Paul Elliot, who had been a senior staff member of Mrs. Clinton’s 2008 campaign and later became a TransCanada lobbyist, was also seeking her support.[3] It is fair to say that there is an appearance of impropriety. 

Motiva Enterprises, owned in part by Saudi Aramco, is expanding its export capacity. Source
For a Whig, the Keystone XL project provides a “teachable moment.” It illustrates the mechanism by which members of government might profit from their association with large corporations, and do so at the expense of the ordinary taxpayer. Two of the more notable Whigs, John Trenchard and Thomas Gordon, wrote that corrupt politicians will, in order to collect thousands for themselves, cost taxpayers millions.   

Whigs understand that the potential for corruption is an aspect of human nature. In contrast, modern day Democrats are inclined to believe that corruption emanates from Republicans, just as Republicans are inclined to believe that corruption emanates from Democrats.
Republicans have embraced the Keystone XL project, because it resonates with their credo “drill, baby, drill.” More importantly, several red states are dependent on the oil and gas industry. Human beings tend to be loyal to those on whom they depend. Because they have embraced the project as their own, Republicans scoff at the notion that the project is designed to satisfy private greed at public expense.

Democrats, for their part, remain indifferent to news regarding the Solyndra scandal. Yet, there is strong evidence of impropriety in that matter as well, and President Obama is directly implicated. Nonetheless, raising the issue of Solyndra as a riposte to the issue of Keystone XL is a pointless distraction. The two matters should each be judged on their merits.

Americans appear to believe that corruption will come to an end when their favored political party finally routes the opposing party. An illustration of this is the newly launched website, Republican House of Scandal. This site, sponsored by the Democratic Congressional Campaign Committee, lists various crimes and ethical violations associated with Republican lawmakers, whether they are proven or merely suspected. 

Republicans, likewise, are keenly aware of instances of corruption among Democrats. To cite one Washington Post editorial, Democrats are said to “wallow in a culture of corruption” and the column opens with the rhetorical question, “Some days you have to ask yourself, my God, what if these people were Republicans?”[4] The premise of the editorial is that the mainstream media are biased in favor of Democrats and avoid reporting on corruption when it is found among Democrats.

In fact, for every Elliot Spitzer (D) there is a Mark Foley (R); and for every Jack Abramoff (R) there is a Charlie Rangel (D). This disheartening reality is revealed in Peter Schweizer’s book Throw Them All Out. The author is scrupulous in giving equal treatment to Republicans and Democrats when exposing instances of corruption. For example, Senator John Kerry (D) and Representative John Boehner (R) both profited from health care stocks sold and purchased – one might suspect – based on their privileged knowledge of the status of the Patient Protection and Affordable Care Act.

A partisan might argue “scandals among leaders in MY party are less egregious than scandals among leaders of THEIR party.” This way of thinking excuses corruption in some cases but not in others. This leads to hypocrisy; famously, the most vocal critics of Bill Clinton’s infidelity – Bob Barr, for example – were unfaithful themselves. The revelation of scandals is used strategically to cripple one’s political opponents. Most Democrats came to Clinton’s defense; most Republicans joined the call for further investigations. Even Richard Nixon had his defenders, in the face of mounting evidence that he had indeed been involved in the crime of breaking and entering. The consequence of this opportunistic use of scandal is that partisan voters, Republican and Democrat alike, have been asked to surrender their principles as the price of party loyalty. 

Of course, neither Democrats nor Republicans in Congress would ever vote in favor of the kind of stringent campaign finance reforms and enforceable ethical standards that would stop this wholesale corruption. It is not in their interest to do so. Partisan Supreme Court justices are also interested in maintaining the status quo; in deciding Citizens United, Justice Kennedy declared – remarkably – that there was no evidence whatsoever that campaign contributions had ever influenced the vote of a member of Congress.[5]
As noted earlier, Republicans claim that the news media are biased in favor of Democrats. Democrats have similarly claimed that the news media are biased in favor of corporate interests. In fact, the leading news outlets have failed all Americans. The words of Benjamin Franklin have proven to be prophetic: “If all printers were determined not to print anything till they were sure it would offend nobody, there would be very little printed.” Today, there is little that is printed that amounts to much: Americans are better informed about the latest Kardashian gossip than they are about acts of Congress. The Colonial Era printer, John Zenger, wrote, “The loss of liberty in general would soon follow the suppression of the liberty of the press; for it is an essential branch of liberty, so perhaps it is the best preservative of the whole.” He did not anticipate that the people of a nation would allow independent news outlets to wither away out of sheer neglect, but the consequences of the loss are the same. 

In conclusion, then, the most needed changes are these: the dethronement of the Two Party System, the cessation of internal conflict in favor of united action on the part of the American people, and the re-awakening of Americans’ passion and determination to regain control over their own government. Americans would be well advised to stop viewing instances of corruption through a partisan lens. To achieve these ends, Americans must be alerted to the folly of partisan enthusiasm, made to feel the costs of political corruption, and encouraged to believe that sweeping reforms are possible. History shows us that Americans are capable of all of these things.   



  1. Replies
    1. THAT WAS A VERY INFORMATIVE PIECE,AND A CREDIT TO JOURNALISM.SOMETHING WHICH IS SERIOUSLY LACKING.As a student of history, I would say that eruptions of scandals are most informative and usually bi-partisan.