Americans often think that the U.S. is relatively free from corruption because cash payoffs, they suppose, are less common here than in some poorer countries. A friend in the money world, though, points out that we just don’t see the special deals obtained by the connected. “Look at all of the Goldman guys,” he said. “They rotate into government and are ‘forced’ to sell all of their shares to avoid a conflict of interest, so they skip out on paying capital gains tax for 20 years of appreciation. Then they rotate out and give their job to another Goldman executive so that he can cash in.”
Buried toward the end of Fly the Quota Skies is an interesting article on what it takes to do business in New York/New Jersey. “United Settles Charges in Case of Flight Route to Benefit Public Official”. From the Federales:
According to the SEC’s order instituted today, United reinstated a nonstop flight between Newark, N.J., and Columbia, S.C., at the behest of David Samson, the then-chairman of the Port Authority of New York and New Jersey who sought a more direct route to his home in South Carolina. … the SEC’s order finds that United officials feared Samson’s influence could jeopardize United’s business interests before the Port Authority, including the approval of a hangar project to help the airline at Newark’s airport. The company ultimately decided to initiate the route despite the poor financial projections. The same day that United’s then-CEO approved initiation of the route, the Port Authority’s board approved the lease agreement related to the hangar project. United employees were told “no proactive communications” about the new route. … The route ultimately lost approximately $945,000 before it ceased again roughly around the time of Samson’s resignation from the Port Authority.
With each $2 trillion spending bill and the lockdowns that shrink the private economy, the share of the GDP devoted to or controlled by government grows. So these opportunities for corruption also grow.
Readers: What do you think? Will corruption be the sector of the economy that grows fastest over the next decade (as government is expanded by Presidents Biden and Harris)?
Related:
- “Forget Stocks Or Bonds, Invest In A Lobbyist” (NPR, 2012): In a recent study, researchers Raquel Alexander and Susan Scholz calculated the total amount the corporations saved from the lower tax rate. They compared the taxes saved to the amount the firms spent lobbying for the law. Their research showed the return on lobbying for those multinational corporations was 22,000 percent. That means for every dollar spent on lobbying, the companies got $220 in tax benefits.
The US has lots of corruption– though it is less of the under the table variety and more influence peddling. So Bill, a disbared lawyer, and Hill, a “public servant,” managed to amass a fortune of now in excess of $200 mil by influence peddling — why else would the Kazakh dictator donate money to their “foundation”? Why was Hunter Biden hired with an exorbitant salary as a “corporate governance” expert — when his expertise seems to be in drug abuse? Barrack & Michelle have, when they are not opining on this and that that is wrong in America, taken up collecting expensive homes in exotic locations. But neither one would seem to have any obvious work skill. The bigger the government the greater the value of an influence peddler — go ask the Indians (dot).
PS the link to the NPR article is particularly inane since is seems to assume that corporate lobbying is the cause, primary cause, major cause of changes to the tax code. So taxes will likely increase on corporate America under Biden and that was caused by corporate lobbying?
A long time ago in a galaxy far, far away (Baltimore, MD) I was an undergraduate student at a rather good university in that fair city (State motto: “Fatti maschii, parole femine” or “Strong Deeds, Gentle Words”) and I was invited to a party at a friend’s house, attended by an eclectic mix of students ranging from undergrad to post-doc. I was bright-eyed and bushy-tailed, idealistic and strong-willed, clear-eyed and earnest, as most young men of my age are at the time, and I felt lucky to spend some time in the company of a few Wiser Elders, more seasoned and worldly than myself, who had “seen the ropes.”
One of the conversations turned to Government and its various functions and funding sources and of course I jumped right in, talking about the honorable principles of our Founding, the Separation of Powers, the principles of Federalism and limited government, and how sorely we needed a return to some of our most cherished and time-honored principles. One of the rather attractive female grad. students, a British national pursuing her doctoral degree at the Nitze School of Advanced International Studies was standing next to me, lounging against a bannister. She listened patiently to my earnest disquisition for a few minutes and then gestured for my empty beer cup, which she graciously refilled and returned to me, and said in her charming London accent (I can’t localize it better than that): “Oh, my dear Alex. All the years you’ve lived here and haven’t learned the first thing about America, which you must fully understand before you attempt any further study. You are trying much too hard. America is all about the money. In everything you will ever study related to the government of this country, you must always begin and end with the money.” She was Zexy, and one smart cookie, too.
From Weird Science. With apologies to Kelly LeBrock. https://www.youtube.com/watch?v=KGG98amezXg
Alex: Loved this, thanks for sharing. I think I was also like this once.. I think.. And that female grad student was very astute.
Phil, you propose to go away with common judicial and moral concept of personal responsibility and share view point of Democratic Representative Alexandria Ocasio-Cortez who said that Chauvin’s conviction was not a substitute for policy change in the United States, while by US Constitution policing is prerogative of local communities and individual states. Queens, NY could be a viable place to explore as an alternative to oppressive “Mascachusets”
^ propose do away
Phil Gramm was a Senator for the State of Texas in the 1980’a and 1990’s. Before John Cornyn, Ted Cruz, and Kay Bailey Hutchison. My father worked on his campaign when he switched from the Democrat to the Republican Party as the “blue dogs” were pushed out. My father espoused his virtue long and hard of “honesty and limited government”. Phil Gramm purchased land for his retirement home worth probably $500,000 or more, for $70,000. His home, an opulent mansion, was built for him for another $40,000 by his “friends”. Even the honest and austere Phil Gramm was not immune to Washington influence peddling. Washington is the swamp that needs to be drained. There was a movement in Texas to attempt to unseat incumbents, but it failed, largely because people like my mother just vote for the Republicans without even nothing to find out who they really are. I reminded her of the events of 1/6/2021, that some of her precious Republicans are treasonous insurrectionists, and she blew it off with the Antifa line.
I am here with your mom. All holistics should stop after primaries are decided. Democrat party showed that they can strong arm all elected congressmen, some of whom are sane and personally decent, into supporting their main unbelievable, ridiculous and dangerous policies that are rifled with corruption that no Republican scheme comes even close to.
This analysis, along the lines of: “How corporations get themselves tax breaks” in the linked article, is entirely ass-backwards. Corporate income taxes are not about making money, they are about exerting control. You could zero out the corporate income tax across the board, and the money would be paid through to individual taxpayers, many of whom are taxed at a higher marginal rate. However, this would deprive the government of a lot of leverage, some of which is doubtless used for graft. A corporation that is paying zero income taxes is fully dedicating its resources in a way that the legislature has dictated. It’s basically “democracy’s” check on corporate governance.
I have to add, with a note of self-referential humor: Practically NO Americans who grew up in New Jersey think: “that the U.S. is relatively free from corruption because cash payoffs, they suppose, are less common here than in some poorer countries.” I agree that they understand corruption taking different forms, and sometimes people from New Jersey don’t consider themselves to be living in a part of the U.S. So this is a very tough question to poll accurately.
Corruption? Lol. Look at who is profiting from recent multi-million$ book deals (advances regardless of actual book sales, aka: money laundering): Hunter Biden, Amy Coney-Barret, William Barr.
Sad. Should be trivial to follow transaction trail of publishing houses, but nobody will do it. Still, $$ amounts are dwarfed by payoffs Democrats include into their bills and other money in politics activities.
Corruption is as old as government. Corruption increases as government increases. The only long-term solution to corruption is to limit the power and spending of the state.
Corruption is the natural state of governance in much of the present-day world, and throughout most of history. Honest, selfless governance is what we should be amazed at.
That does not cancel moral and personal responsibility. We can not just forget about justice and crooks who attained high positions and just have another systems a-la 1917 Russia or 1933 Germany or 1946 China or most of other 20th century coups and revolutions. They did not really work. It never works when justice is ignored. New crooks are always more crocked then old crooks.