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Considering the gravity of the risk in Wall Street banks being too big to fail, the financial reform bill passed by the US Senate in 2010 may have been influenced too much by the financial interests. It can thus serve as a good case study for how a republic can be subject to too much influence from the moneyed interests. It could be asked, moreover, whether there is an inevitable trajectory that a polity undergoes from being a republic to becoming a plutocracy (ruled by the wealthy).

Executives and political action committees from Wall Street banks, hedge funds, insurance companies and related financial sectors showered Congressional candidates with more than $1.7 billion in the last decade, with much of it going to the financial committees that oversee the industry’s operations. In the 2010 election cycle before the financial reform bill passed the Senate, members of the financial committees far outpaced those of other committees in fund-raising parties by holding 845 events. The 14 freshmen who serve on the House Financial Services Committee raised 56 percent more in campaign contributions than other freshmen. And most freshmen on the panel, the analysis found, are now in competitive re-election fights. In return, the financial sector has enjoyed virtually front-door access and what critics say is often favorable treatment from many lawmakers. But that relationship, advantageous to both sides for many years, is now being tested in ways rarely seen, as the nation’s major financial firms seek to call in their political chits to stem regulatory changes they believe will hurt their business.

Even after the passage of the Senate’s bill, the financial industry was confident that a provision that would force banks to spin off their derivatives businesses would be stripped out, but in the final rush to pass the bill, that did not happen. The opposition came not just from the financial industry. The chairman of the Federal Reserve and other senior banking regulators opposed the provision, and top Obama administration officials said they would continue to push for it to be removed. Such officials could include Larry Summers, who along with Alan Greenspan and Robert Rubin pushed for derivatives to be left unregulated in the late 1990s while Summers and Rubin were in the Clinton Administration.

Not missing a beat, Wall Street lobbyists  began an 11th-hour effort to remove it just as House and Senate conferees were preparing to meet to reconcile their two bills. Lobbyists said they were already considering the possible makeup of the conference panel to focus on office visits and potential fund-raising.  Rep. Barney Franks, chairman of the House Financial Services Committee, signaled on May 25th that the prohibition on banks trading in deriviates using their own funds could be dropped. “I don’t see the need for a separate rule regarding derivatives because the restriction on banks engaging in proprietary activities would apply to derivatives as well as everything else,” Mr. Frank said according to The Wall Street Journal (May 22, 2010, p. A6).  However, if this were the case, why would Sen. Dodd, the White House, and the banks be so set against removing the derivative langauge?  Is redundancy really that big of a deal?  Something is rotten here; I can smell it. With Sen. Dodd retiring, I wouldn’t be surprise if he made a deal with Wall Street concerning his financial future–it being so odd how he has mellowed so much on reform. Not surprisingly, the Chamber of Commerce had already spent more than $3 million to lobby against parts of the bill, including the derivative provision, and as the Senate was passing its bill the Chamber was planning to keep fighting for a loosening of the regulatory restrictions — first in the House-Senate conference, then in the implementation phase after final passage of a bill, and “if all else fails,” in court. With all these avenues, it is no wonder that the money of Wall Street banks has such ease in Washington.

There are so many points along the line of a bill becoming a law that a provision with teeth can be targeted by well-funded parties with a vested interest against it, it would appear that no change can happen in the US that is not in an industry’s interest.  Because wealthy firms have presumably done ok under the status quo, it is not clear why they would have an interest is supporting systemic change even if systemic risk warrants it. In the case of financial reform,the financial houses have a rather obvious conflict of interest. Furthermore, the behavior of the big bankers in September of 2008 suggests that they do not view rescuing a financial system in crisis as their job.  There is no reason to suppose that the legislation that they support would be geared to repairing the system when it is in crisis. The real problem is apt to manifest on the crest of the next bubble, as the industry had already gotten much of what it wanted even with the derivatives language in the Senate bill.
According to The New York Times, “Despite the outcry from lobbyists and warnings from conservative Republicans that the legislation will choke economic growth, bankers and many analysts think that the bill approved by the Senate … will reduce Wall Street’s profits but leave its size and power largely intact. Industry officials are also hopeful that several of the most punitive provisions can be softened before it is signed into law.”  This is dangerous because so many bankers, including those at Goldman Sachs, have been in denial as to how they should behave.  According to The Wall Street Journal (May 26, 2010, p. A1), Bank of America, Deutsche Bank, and Citigroup have continued their practices of “window-dressing”: temporarily shedding debt just before reporting their finances to the public. This suggests that “the banks are carrying more risk most of the time than their investors or customers can easily see.”   As of 2010, this activity had actually increased since 2008, “when the financial crisis brought actions like these under greater scrutiny.”  For ten quarters ending March 2010, the three banks lowered their net borrowings in the repo market by an average of 41% at the end of the quarters (as compared with during them). This represents a significant misstatement, which the banks’ auditors should have highlighted. The Wall Street Journal reported in April 2010 that 18 large banks, as a group, had routinely reduced their short-term borrowings in this way.

So it appears that Wall Street went on in its old ways even after the crisis, and there was relief that financial reform would not rock the boat. According to The New York Times, “If you talk to anyone privately, there’s a sigh of relief,” said one veteran investment banker who insisted on anonymity because of the delicacy of the issue. “It’ll crimp the profit pool initially by 15 or 20 percent and increase oversight and compliance costs, but there’s no breakup of any institution or onerous new taxes.” In other words, incrementalism rather than systemic change.  Washington, in other words, had been bought–even the “real change” agent himself, Barak Obama.  Mr. Obama is not unaware of the powerful friends he will need in 2012. He received just under a million dollars from Goldman Sachs for his 2008 campaign.  How difficult it is to let go of power, and say that one term will be enough, even better, for that is what seems to be necessary for one to fight against the entrenched culprits of the status quo.  In actuality, Andrew Jackson showed in 1832 that standing up to a large bank (in his case, the Second Bank of the US) can actually be consistent with winning reelection.  But absent such faith in the people to come through, saying to hell with reelection seems to be necessary for a president to be an authentic agent of real change.  If anything called for such change, it was the financial crisis of 2008. Yet as the House and Senate compared notes on their respective bills, Wall Street was actually relieved.  That really says something.  The culprits have an effective veto on what safeguards will be put in place to keep the banks from risking the world economy again. The wolves have to accede to the design of the new chicken coop. To my fellow Americans, I say: this is our system.

Even though the financial crisis far outweighed any health-care crisis, the financial reform is far more incremental–though both are within that rubric. “The health care bill is going to transform the structure of health care exponentially more than this legislation on financial regulation is going to change Wall Street,” said Roger C. Altman, the chairman of Evercore Partners and deputy Treasury secretary in the Clinton administration. “It’s not even close.”  It could be that the added incrementalism in the health-care legislation was in the interest of the health insurance companies and hospitals, whereas less was in the interest of Wall Street.

Of course, it could be that regardless of the regulation, financial bubbles are bound to come and go, and the sheer scale of financial deals today requires large banks. Donald B. Marron, the former chief executive of PaineWebber, avers, “Despite these new rules, Wall Street will continue to provide the same important business services because the same needs are still there — creating liquidity; financing governments, corporations and individuals; and providing financial advice and products.” So perhaps the financial leverage of Wall Street in Washington doesn’t keep us from achieving a solution because the financial markets and their players are going along a trajectory that is being defined by the progression of the financial market.  Consider, for example, the pressure on banks from globalization to amass more and more capital for bigger and bigger deals.  In other words, the “too big to fail” phenonomon could be a necessary part of an increasingly globalized financial market.  Of course, this could point to the need for greater international financial regulation.  But with Europe enbroiled with a debt crisis of its own and China wearily watching its own housing bubble, there were at the time of the passage of the Senate’s bill more financial bush-fires in the world than firemen.  The problem is that the fire chiefs are too often paid off (and intimidated) by the profiteering arsonists, so we are left woefully unprotected even if the veneer of regulatory reform has the looks of an effective profilactic.

Sources:  http://www.nytimes.com/2010/05/23/us/politics/23lobby.html?scp=2&sq=financial%20lobbying&st=cse ; http://www.nytimes.com/2010/05/24/business/24reform.html?hp ; WSJ (May 26, 2010).

Senator Kirsten Gillibrand, D-NY, claimed in July of 2010 that the UK government should investigate what role BP played in Britain’s decision to free Abdel Baset al-Megrahi in August 2009. Al-Megrahi is the only person convicted of carrying out the 1988 bombing of a Pan Am airliner in which 270 people were killed over Lockerbie, Scotland. This is not to say that he acted alone. In February, 2011, Gadhafi's justice minster, Mustafa Abdel-Jalil, who resigned in protest against Gadhafi's massacre of unarmed protesters, told a Swedish newspaper that Gadhafi had ordered the attack. Abdel-Jalil also claimed that Megrahi threatened to "spill the beans" unless his return to Libya were secured. It would appear that BP, a publically-traded stock corporation, played a vital role between Gadhafi and the British government. If so, then aside from Gadhafi's sordid role, this case presents us with an issue of business ethics. Specifically, does a corporation, which is essentially private wealth but with responsibility befitting the power that comes with such wealth, cross a line when its employees engage in foreign policy? The ethical problem inherent in interfering in a juridical sentence is troubling enough; if an unelected corporation becomes so powerful that it can affect international relations between (and foreign policies of) countries, then the issue involves not only business ethics, but also democratic governance. As the line between private and public blurs, the respective bases of legitimacy can become conflated or transposed.

In May 2007, BP signed a $900 million exploration agreement with Libya. Also that month, Britain and Libya signed an agreement that paved the way for al-Megrahi’s release from a Scottish prison. A spokesman for BP has admitted that people at the company lobbied the British government over the prisoner transfer deal with Libya in late 2007, but the company’s spokesman denied that the lobbying played any role in the government’s decision to release al-Megrahi nearly two years later. Senator Charles Schumer, D-N.Y., argued that ”the whole thing has deep circumstantial evidence that points to the fact that there was a trade-off — release the terrorist in exchange for an oil contract.” Schumer and three other US senators — Kirsten Gillibrand, Robert Menendez and Frank Lautenberg — wrote to Secretary of State Hillary Clinton asking that the State Department investigate whether BP had a hand in the release. “Evidence in the Deepwater Horizon disaster seems to suggest that BP would put profit ahead of people — its attention to safety was negligible and it routinely underestimated the amount of oil gushing into the Gulf,” they wrote. “The question we now have to answer is, was this corporation willing to trade justice in the murder of 270 innocent people for oil profits?” The answer appears to be “yes.”

In an interview with the Daily Telegraph (September 4, 2009), Jack Straw admits that when he was considering in 2007 whether the bomber should be included in a prisoner transfer agreement (PTA) with Libya, Britain’s trade interests were a crucial factor. When asked in the interview if trade and BP were factors, Mr Straw admits: “Yes, [it was] a very big part of that. I’m unapologetic about that … Libya was a rogue state… . We wanted to bring it back into the fold. And yes, that included trade because trade is an essential part of it and subsequently there was the BP deal.” In short, BP employees have admitted to the lobbying and Jack Straw has admitted that BP’s contract was a factor—the two sides meet and the knot is tied.

Analysis:

Even BP’s lobbying effort was not decisive in the exchange agreement, the involvement of BP managers even as they and BP stood to gain from an oil exploration contract evinces a conflict of interest that should have been barred by ethics guidelines at the company. Moreover, the company had no standing in the prisoner exchange matter such that it had any business in lobbying. At most, the legal person legal doctrine and the associated “money as free speech” doctrine pertain to a company’s main business. The doctrines ought not give a company all rights of citizens because corporate charters are delimited to particular domains or functions. Furthermore, to expect a company to put ethics ahead of profits is to conflate a firm with a human being.  To be sure, a company is made of people (and capital). However, the association is focused rather pointedly on one thing: maximizing shareholder value through profits. Accordingly, managers know legal requirements, whereas ought and should are more difficult to translate into cost-benefit analyses. In other words, a company is like a shark in that both are single-minded feeding machines. To expect a machine to obviate its next feeding because of an ought is to treat it as something other than what it is.  I suspect that as onlookers we tend to project our own values onto company managements—even companies themselves—instead of coming to terms with what a company is.  It is a feeding machine with one directionality and an expansive appetite, which includes venturing into other domains such as (hypothetically)  lobbying for an exchange of prisoners in exchange for a lucrative oil contract. In other words, companies are designed to transgress even their own charters. They are like Hal in the film 2001—the computer that took on a life of its own. Ideally, a company would convert anything in a given society into a commodity, with price being the universal measure. The US senators are objecting, in effect, to the commodization of the prisoner exchange, and to the “boundary issues” of BP.

The “so what” of this analysis is the following: it is particularly dangerous for a company or industry to be so powerful that it can unduly influence a government both in terms of a judicial sentence and in relation to other countries. Given the expansive nature of a company, society must have a means of keeping corporations within their proper domain of providing goods and services.  In a plutocracy (rule by wealth),  private wealth is the basis of government. This is not the case in republics, which are characterized by representative democracy.

Sources:
http://www.msnbc.msn.com/id/38256677/ns/world_news-africa/
http://www.heraldscotland.com/news/home-news/megrahi-threat-to-reveal-truth-over-lockerbie-1.1087516?utm_source=twitterfeed&utm_medium=twitter

Related (on BP): http://euandus3.wordpress.com/2010/05/17/business-society-bp-clips-societal-norms/
http://euandus3.wordpress.com/2010/06/22/bp-and-mms-complicating-the-different-demons-of-the-democratic-and-republican-parties/
 http://euandus3.wordpress.com/2010/06/17/tony-hayward-sticking-to-script-safety-is-bps-priority/ http://euandus3.wordpress.com/2010/06/10/bp-dividends-to-stockholders/  http://mole45.wordpress.com/2009/09/05/jack-straw-admits-lockerbie-bombers-release-was-linked-to-oil-well-thats-a-shock-if-we-can-go-to-war-for-it/

In July, 2010, a few days after the Agricultural Bank went public in an IPO bringing in $22 billion, dozens of former bank employees stealthily gathered outside the headquarters of the country’s central bank. Like many other state-owned companies, the bank slashed its payroll and restructured in order to raise profitability and make the bank more financially attractive to outside investors. By Western standards, the bank was overstaffed, a legacy of its role as one of the pillars of China’s socialist financial system. The fired bankers have no legal redress in China. In 2000, the Supreme People’s Court put an end to any hope that the legal system might adjudicate such disputes, saying that plaintiffs from state companies had no standing in Chinese courts. So the ex-bankers protest—at least they attempt to do so before being picked up by a coordinated police response. This dynamic should come as no surprise to anyone.  What might not be so apparent is the ability of the banks to use the police to go after recalcitrant ex-employees. The banks are so powerful that they can enlist the local police to keep an eye on the most troublesome employees, often following them to Beijing, where their protests and petitioning can prove embarrassing for executives back home. One ex-employee said, “The head of my branch said he would never give me my money and spend any amount to fight me to the end.”  I contend that it is troubling that the director of a bank branch whose mentality it is to spend any amount of money to fight an ex-employee has police-power at his beck and call.  Beyond the lack of an independent judiciary in China, the possibility that a banker in any country could have a police force at his or her ruddy fat hands is something that ought to be investigated.  While it might be tempting to relegate such a scenerio exclusively to China, European and American states are most likely not immune either.

Source: http://www.nytimes.com/2010/08/16/world/asia/16china.html?pagewanted=1&_r=1&dbk

On February 17, 2011, The New York Times ran two major stories that have a common denominator: angry protesters. Bahrain and Wisconsin are not typically thought of together.  Bahrain is a small kingdom in the Middle East whereas Wisconsin is a large republic in North America. In mid February, 2011, both were enveloped in protest at their respective capital cities.

In Manama, Bahrain, the army took control on February 17th; on the following day, the military would use automatics against a group of protesters. Before the army had taken control of much of the capital city, the police had opened fired on protesters camped in Pearl Square--that occurred a day after the king had said that the protesters could use that park to express themselves. According to The New York Times on February 17th, "As the army asserted control of the streets with tanks and heavily armed soldiers, the once- peaceful protesters were transformed into a mob of angry mourners chanting slogans like 'death to the king,' while the opposition withdrew from the Parliament and demanded that the government step down."  In short, violence had turned on peaceful protest, turning the capital city into a near warzone, and that situation was repeated the next day.  From the standpoint of the protests in Madison on February 17th, the scene of carnage in Manama would have been difficult to imagine. My thesis is simply that the difference should not be overdrawn, as both the people in Manama and Madison are human, all too human, and thus able to engage in similar actions.

In Madison, protesters had begun protesting on February 16th. I happened to be in Madison on that first day and I witnessed the protest. On the 17th, the protesters were congregating at the seat of government when opposition walked out of the Senate (and in fact out of Wisconsin). With the majority party one person short of a quarum in the Senate, the walkout on Walker (i.e., the governor: the head of state and chief executive of Wisconsin) left his the bill reducing benefits for public employees and restricting their unions' collective bargaining rights to wage negotiations (up to the rate of inflation in Wisconsin) in limbo. The New York Times reported on February 17th that "Walker’s plan was upending life in the capital city."  On the 18th, the paper reported that on the previous evening as the rallies against the bill grew, "(p)eople screamed: 'Shut it down! Shut it down!' Drums pounded. Students, some barefoot, danced." This description is more revealing than one might suppose at first glance.

Even though the protesters in Madison can be distinguished as a group from the protesters in Manama, the protesting Wisconsinites should not be treated as a homogenious mass. In fact, the presence of out-of-state university students broadened the protest beyond Wisconsin. Furthermore, although some of the students were doubtless deeply involved in labor issues, many of the students I saw on their way to the protest on the 16th looked excited rather than angry. Some even had little pictures painted on their faces as though they were going to a summer art festival or rock concert. Later in the week, a large drum circle took shape inside the capitol. At times protesters seemed more concerned by what they regarded as insufficient attention on them by the national media than by their cause. It's all about me! Watch me! That is not a true revolutionary attitude.

The more disgruntled, personally-invested protesters (i.e., actual workers) might have been mobilized by the unions that would receive less in union dues if public workers had the right to withhold union dues (a feature of the proposed bill). In other words, greed rather than anger might have been motivating some of the protest organizers even if most of the unionized protesters were motivated by principle. Also, in addition to teachers attending on principle, schools may well have organized their students to attend as a group. Before lunchtime on the 16th, I witnessed a very large number of students walking from their school to the capitol. Their presence seemed organized; that is, I had the sense that the students had not spontaneously self-organized themselves; moreover, they seemed excited about the cancellation of classes and hence no quizzes (remember how that felt?) and stimulated by all the excitement in downtown Madison. None of the high school students I saw looked angry.  Looking at them, I noticed the party atmosphere--far from a revolution in the works. 

Therefore, lots of agendas (including the labor-protecting one that was passed on by the media) went into the protests in Madison. My point is not that the protesters were somehow fakers; I did not get that sense from watching them, and I saw many (especially the workers themselves) who were protesting on behalf of the right to collectively bargain. Rather, my point here is that things that are notably different may look like one fuzzy blob from a distance (i.e., through the media). Just as it is easy to conflate the various segments at a distance into one angry mass, it might seem like the protests in Madison were essentially like those that were taking place in Manama at the same time. I argue this point first, after which I suggest some underlying potential commonalities based on human nature and political organization generally.

In terms of being different, shutting down the Senate temporarily is a far cry from a revolution wherein an entire government is to be permanently shut down and replaced. Treating the passage of a bill as though it were a matter of life and death smacks of hyperbole. Responding to the flight of the democratic senators, for example, Senator Scott Fitzgerald said, “This is the ultimate shutdown.” Well, no, Senator; the ultimate shutdown was occurring in Tunesia, Egypt and Libya. What was going in Wisconsin was not revolution even if that language may have served the protesters' various purposes. The difference between the two protests can be appertained by contrasting college students in Madison dancing barefoot while protesters in Manama were facing live gun-fire. Screaming "[temporarily] shut it down!" is not like screaming "stop shooting at me!!!" Protesting for a real revolution seems like a world away from protesting to "stop the bill." Accordingly, the pictures below of the protest in Madison show a scene remarkably unlike the one above of the violence on the same day in Manama.


In Madison, the likelihood that the protests would turn violent was perceived on both sides as being so remote that protesters were allowed inside the capitol building, where all three branches of the Government of Wisconsin are situated.


Whereas the police and military in Manama were mobilized on the 17th to remove protesters from a city park, the Wisconsin National Guard (the military) was nowhere to be seen as protesters engulfed even the capitol building itself in Madison. Even when the capitol police wanted to clear the building for cleaning on the Sunday of the second week, the protests were able to remain. In fact, the Wisconsin National Guard had been notified by the government of possible activation not to protect the government from the protesters or to clear them, but, rather, to step in to perform vital governmental functions should the public employees go on strike. In short, the image of college students--pre-inclined to join any protest on the left while studying at a historically progressive (yet internally corrupt) university--dancing barefoot as "angry protesters" in a seat of government is difficult to reconcile with the pictures we have seen of protesters in the Middle East getting shot at and carried to hositals. I wouldn't blame one of the real protesters for shaking one of those students and saying, "Hey, this is serious!" 

Why were the protests in Madison so different on the surface from those in Manama? Why did the drama turn Madison into "a political circus," according the USA Today, while mourning protesters (and even the medics trying to help them) were getting shot at? My knee-jerk explanation is that the tradition of democracy and protest that had by 2011 been so engrained in Wisconsin that no one there would have suspected in February of 2011 that violence would erupt. Furthermore, in spite of there being a protester's sign displayed at the protests in Madison identifying Gov. Walker in Wisconsin with Pres. Mubarak in Egypt in "One Down, One To Go," the Wisconsin protesters' goals did not reach toppling the republican legislature and chief executive, or even the form of government itself.  This said, I contend nevertheless that the disjunction or dichotomy between the protests-to-violence in Manama and the protests-as-festival in Madison is in part illusionary. Imagine, for example, some blue coller unionists in the capitol building suddenly losing their cool and pushing against the police and the latter over-reacting.  Imagine how quickly the barefoot dancing would turn to horror amid real-time images at point-blank range of blood and open wounds. Suddenly, the stakes would get very real--yet I suspect that the protesters would still shink from demanding an actual revolution wherein the government itself would be deposed or overthrown. In other words, the distance between Madison and Manama would have been narrowed, but not eliminated.

The inhabitants in the United States are muffled from the starker political protests that go on in other regions of the world; so much of the status quo is presumed in the U.S. Also, the difference between a real dictatorship and the republic form of government, and the difference between the political culture of Bahrain and that of Wisconsin make a difference, to be sure. However, a political protest by a mob is inherently unstable; the police and military in Wisconsin were just as capable of violence as were the police and military in Bahrain.  This point is often lost on people living in a society whose political system has been stable for over a century.

Just a week before the protests, a Madison police officer had been dismissed for "overbearing, oppressive, or tyrannical conduct." Visiting Madison for the day on February 16th, I personally witnessed similar conduct by a policeman. Having no idea why there was a crowd at the capitol, I walked to one of the street baracades to ask a Madison policeman. I started chatting with him lightheartedly about the protest.  He told me that 40 buses were on their way from across Wisconsin, and I mentioned my thought that government is indeed more accessable to a Wisconsinite in Wisconsin than in Washington, D.C., so it makes sense to me that more domestic policy should be decided by the Wisconsin Government (and less by the General Government). I wasn't sure what the policeman thought of my mini-lecture on federalism, so I did not belabor my point.  In the context of the noise from the protesters, I then mentioned offhandedly what I had heard earlier that day from some local residents concerning the local apartment building owners and managers being unethical with deposits and  regularly ignoring complaints by their adult tenants about drunk college students regularly disturbing them in the middle of the night. I told the policeman that I was surprised that the property owners and students get away with the collusion there. Furthermore, I said I would have thought that the police department would have come down on the local property owners for not being responsible in managing their buildings. The policeman's reaction was, frankly speaking, pathological and excessive. He  began quickly walking away from me, stating in an aggressive tone, "I don't know about that case! WE ARE DONE HERE."  While he was walking away from me as though he had temporarily lost impulse control, I tried to remind him that I had said that the local property owners were the corrupt parties in those cases--that the police had simply not broken up the collusion between them and the drunk college students.  I had not mentioned a particular case, so I was surprised by the irrationality of his apparent need to assert his ignorance of any particular case. His assumption, in other words, was way off (and his emotional reaction was excessive), and yet he had the gun.  This is what really concerned me. Additionally, his reaction itself, being disproportionate, could have been an indication of guilt concerning the existence of a cozy relationship between the local property owners and his department. In short, I was left to question an on-duty policeman's state of mind and impulse control, ironically as I walked in the direction of the "angry" protesters. A friendly chat amid the festivity of the protesters had quickly turned on me, and in a most irrational and bizarre way. I could see how the police, whether from incompetence, psychological make-up, or corruption, could feel themselves justified in suddenly attacking protesters based on some imagined provocation. In other words, I could visualize Madison becoming more like the capitals such as Manama in the Middle East. However, such a visualization could not gain much traction due to the very different political contexts.

On Saturday, February 19th, Tea Party and pro-labor activists protested peaceably outside the seat of government of the republic of Wisconsin, while "Libyan forces opened fire on mourners leaving a funeral for protesters Saturday in the flashpoint city of Benghazi." Both were simultaneous front-page stories on msnbc.com (and CNN)--the Libyan death toll from protests reaching 100 due to the 15 killed on that Saturday, while Wisconson senators were praising the lack of any violence in five days of mass protest. The contrast could not be starker. Besides the obvious difference in violence, protecting the bargaining power of public-sector unions in a republic is a world away from deposing a dictator.



Even so, the potential of an underlying common denominator based on human nature, from which violence is possible at any large protest, should not be so easily dismissed even where there are limited aims, a mitigating poltical culture, and a relatively open political system. To support this point, I now turn to the matter of the more fundamental substratum existing in the concurrent protests in Madison and Manama (Sana, Yemen and Benghazi, Libya could easily be substituted here for Manama).

For one thing,  Madison may not have been any less corrupt than Manama at the time of the concurrent protests. Apart from the progressive students that the university there is known for, the city itself is rather provincial.  For example, La Follette remarks in the preface of his autobiography that the political boss in Madison was quite corrupt and exclusionary. In the 1930s, the inside group in the city government twice thwarted the will of the people expressed in two referendums that Frank Lloyd Wright's plan for a city building on one of the city lakes be built (Monona Terrace was finally built in the 1990s). The reason, according to a PBS documentary on Wright, was that the city "leaders" didn't like him. Similarly, in the early 1990s one of the dean's offices at the university in Madison lied to a professor up for tenure in the early 1990s about the result of his tenure vote (which I believe is a felony) simply because some people at the university didn't like him. Even twenty years later, academics warn about the vindictive politics at that university. Even faculty at the university talk openly of the corruption. For example, one spoke openly to colleagues at other universities about having complained in utter futility to the university's chancellor about the chief of the university's police department notifying students' parents of the respective students' criminal records with the department (which is against privacy laws). The chancellor apparently told the professor that he didn't want to go up against the lesbian. A fish rots from the head down. So it should not be surprising that physicians from the university's hospital (or medical school) were blatantly handing out fake sick notes outside the capitol to local teachers who had called in sick to join the protests. The ends justify the means every time, right?  Perhaps it could even be said that the violence at the Vietnam War protests at the university in the late 1960s were stoked by (and perhaps an unconscious vent releasing pressure from) the stolid corruption in the university's administration. In short, the city (and the University of Wisconsin) may suffer from a corrupt insider element that does not feel itself constrained either by fairness or the law, and this could potentially sow the seeds for revolution. The seed, after all, is in the harvest.
That Wisconsin is a republic (i.e. a policy characterized by representative democracy) whereas Bahrain was a kingdom at the time does not mean that abuse of power by public authorities was not possible in either polity. Moreover, the problems in Wisconsin at the time of the protests there likely went far beyond the Wisconsin Republican Party imposing its will against the entrenched unions and state employees. Judging from the extent of corruption in Madison at the time, the protesters there were probably not going far enough in their demands. For one thing, the firing of the chief of police could quite reasonably have been added to their demands. Such a demand would move Madison closer to the protesters at the time in the Middle East. Outside Sana University in Yemen, for example, a few hundred people complained on February 17th of corruption and poor government services. According to USAToday, Mouath Hamed, for example, said that corruption was killing Yemen. Also unlike the protesters in Madison, the protesters in Sana  declared, "This is the beginning of the revolution," and they faced sticks and electro-shock weapons as the students in Madison danced barefoot. To the extent that Madison was similarly corrupt, there was the potential for such protest (and governmental response) there too. Had that potential been realized, I suspect the students would not have been dancing barefoot for long.

The capital city of a republic can be so corrupt that protesters in such a city should demand mass resignations of  entrenched, corrupt and incompetent civil servants in order to clean up the people's house. It could be objected that my American cultural bias shows through here; to expand protest demands merely to include getting rid of civil servants can be labeled as an Americanization of what in terms of the Middle East protests would include the ouster of top government officials and the cessation of extant constitutions. To be sure, the American constitutions are already democratic. However, it is only to the extent that a constitution really is democratic that it can be expected to not be treated by protesters like a constitution in the Middle East that props up a dictator. For instance, to the extent that office-holders in a republic can protect themselves as entrenched incumbants from the electoral check afforded to the people by a democratic constitution, the protests of the people could come to approximate those in a dictatorship, even in America. That is to say, the curtain of political stability that we presume distinguishes us from them could be ripped down the middle if the corruption continues to get worse. Depending on the salience of popular sovereignty in the American republics, it is possible that the sort of demands made by the protesters in the Middle East could be carried by westerly winds and take root in the United States. I am not advocating such protests because they risk the total collapse of civic order. Also, unlike dictatorships, republics can perhaps repair themselves without such violence. Even so, I acknowledge that fundamental protest that treats the system of governance itself as illegitimate--"Shut it down for good!"--could take root in any of the United States if sufficient public frustration builds up amid the hubris of wealth and power.

Furthermore, I assert that the potential for such protest was latent even in the barefoot-dancing (and drumming) protest in Madison even though that protest was (shortsighted in being) limited to defeating a bill. Wisconsin really would have shaken things up in the United States had the removal of corruption there and the associated  entrenched  public  authorites been the key demand. While some of the protesters did seem to have sufficient gumption (or partisanship) to protest until the head of the government resigned, even such a demand would have been viewed as too unrealistic (or radical) by most of the "progressive" protesters themselves in the land of La Follette. A real revolution must go beyond partisan-ship to clean house rather than merely rearrange deck chairs.  One would like to think that representa-tive democracy obviates such spring cleaning. However, no political system is perfect.

Abstractly speaking, human political nature is a constant in the human race; accordingly, the potential for escalation and ensuing violence should not be summarily dismissed on the basis of an assumed sui generis American civic culture that is somehow immune from revolution. In the American context, the driver to watch is the extent to which the corruption of wealth entrenches itself in the halls of government at the expense of government of, by and for the people. Public officials desirious of favors, good relations, friendship, or money are tempted to develop cozy relationships with entrenched private property interests at the expense of the public good and justice. At the time of their respective protests at least, Madison and Manama may not have been so different in this regard. Therefore, even though the pictures of the respective protests in Manama and Madison clearly suggest marked differences in the nature of the protests, the underlying dynamic might have been more alike than the barefoot dancers in Wisconsin could have known, for they were generally blind in their festivity to the true corruption in their midst. It is far easier to see corruption in the other's yard than on one's own street.

In summary, America is not an island isolated from human nature. We are not so exceptional or protected as the political culture we have built up may suggest to us.  As incredible as it may seem, both in terms of aims and governmental reaction, the protests that were spreading throughout the Middle East in early 2011 could manifest at some time manifest in any of the United States. It is not as though American public-private liasons are so pristine or salubrious that fundamental protest could not take root. We are not so different--not so immune--as we might suppose. It may be that the Tea Party included traces of this more fundamental level of protest in the 2010 election season in declaring that the U.S. Government had gone beyond its constitutional authority in certain respects and was to that extent illegitimate as a government. It should not be lost on any of us that the subterranean human political dynamic stemming from human nature can surface at any time, anywhere. Specifically, the human proclivity to engage in corruption and even violence and to protest arrogant governmental encroachment on human liberty are the real dynamics going on under the surface anytime, anywhere, there is political authority and mass political protest.  A political culture can moderate this dynamic only to a certain extent, even if appearances seem to say otherwise. Any type of government invented by man is mortal, and flawed, being constructed by and inhabited by human beings. Likewise, human nature is mortal, and flawed. The interaction of political organization and human nature cannot be segmented by region or political system such that one area or type is somehow different, or safe from the latent violence that is almost inherent in the interaction itself. So the protests in Madison and Manama were in some important ways very distinct, but in a more fundamental sense they were made of the same stuff--albeit realized outwardly differentially because of the different types of polity and cultures.

In the end, good government is based on caritas seu benevolentia universalis (higher human love, that is, universal benevolence) rather than privilege and partiality. The people of any polity have the right and  responsiblity to insist that the people they put in authority over them use their power on the basis of compassion rather than corruption.

Sources:
http://www.nytimes.com/2011/02/18/world/middleeast/18bahrain.html?hp

http://www.nytimes.com/2011/02/17/us/17wisconsin.html?ref=todayspaper

http://www.nytimes.com/slideshow/2011/02/16/us/WISCONSIN-8.html (poster of Mubarak and Walker at the protests in Wisconsin)

http://www.nytimes.com/2011/02/19/us/19wisconsin.html?pagewanted=2&hp

http://host.madison.com/wsj/news/local/govt-and-politics/article_1a175cce-30c3-11e0-b614-001cc4c03286.html  (on the psychology/corruption in the Madison police dept)

Iona Craig, "Protests Spread, Worsen in Middle East," USA Today, February 18, 2011, p. 8A.

Dennis Cauchon, "In Wis., Pitched Battle by Unions," USA Today, February 18, 2011, p. 1A.

Concurrent lead stories on protests in Libya and Wisconsin on February 19, 2011:
http://www.msnbc.msn.com/id/41658587/ns/world_news-mideastn_africa/
http://www.msnbc.msn.com/id/41664858/ns/us_news-life/
http://www.foxnews.com/world/2011/02/19/rights-group-estimates-84-killed-libya-protests/
http://www.foxnews.com/politics/2011/02/19/saturdays-protests-wisconsin-expected-biggest/

On La Follette of Wisconsin, see: http://en.wikipedia.org/wiki/Robert_M._La_Follette,_Sr.

In March, 2010, leaders of the US House Appropriations Committee (chaired by Rep. David Obey (D-WI)), banned ear-marks to for-profit companies. Had the ban on for-profit earmarks been in place in 2009, it would have meant the elimination of about 1,000 awards worth a total of about $1.7 billion. Many of those earmarks went to military contractors for projects in lawmakers’ home districts. The decision ends a practice that has steered billions of dollars in no-bid contracts to companies and set off corruption scandals. So far, though, the Senate is not joining in. House Democrats had tried to reach an agreement with their counterparts to ban for-profit earmarks, but the senators balked, Congressional officials said. With the Senate including for-profit earmarks in its budget bills and the House excluding them, negotiators from each body will have to determine which earmarks, if any, would make it into a final bill sent to the White House for approval. So it is possible that businesses could continue to get no-bid government contracts. According to the Office of Congressional Ethics, there is a “widespread perception” among the private-sector recipients of earmarks that giving political contributions to lawmakers on the panel helped secure the grants. It is possible that this assumption could survive from future ear-marks (via conference committee negotiations)  even as the House leaders are percieved as having solved the problem.  In other words, the corporate political contributions continue even as the House incumbants campaign on having solved the problem in the House.

Source: http://www.nytimes.com/2010/03/11/us/politics/11earmark.html?ref=us

As I had suspected, Barak Obama’s 2010 speech at the UN’s annual opening lacked tangible proposals.  For example, he urged progress on the middle east peace talks, but proffered no proposal.  He said Africa could be prosperous agriculturally, but gave no proposal for how.  Also, he said corruption in governments of developing countries is a problem, but offered no solution.  Pointing to corruption in general diffuses responsibility so talking about it does not shame anyone into making hard choices.  In my view, more radical (i.e., systemic) changes are needed, but the politicians are too mainstream/moderate for that.For example, he could have urged African leaders to cede more governmental sovereignty to the African Union, which in turn could then act as a check on government corruption at the state level.  Also, Obama could have proposed a loose federal confederation for the middle east, which would mitigate the middle east conflict, or he could have given a proposal involving the borders of a possible Palestinian state (i.e., what to do with Jerusalem). Finally, the President could have gone beyond citing his efforts to reduce the risk of nuclear proliferation to announce that the US would join the ten countries that have created a movement with the goal of eliminating nuclear weapons completely—even from the present nuclear powers such as the US. Meeting on the sidelines of the UN General Assembly in New York, the 10 countries launched the new initiative to work towards a world without nuclear weapons. Foreign ministers, led by Japan and Australia, hoped to bring new life to efforts for nonproliferation and disarmament. Their mission statement said: “The only guarantee against the use and threat of nuclear weapons is their total elimination.” This would be real change.  In contrast, Obama said his goal is securing loose nuclear material around the world in four years.  This sort of goal shows that he is inside the box—an incrementalist rather than a leader.

I wish the President and his advisors had thought more to create new proposals and to think outside the box than simply putting a nice-sounding speech together. In short, in place of politics as usual, there could have been real change in the speech.  What good do platitudes do?

See: http://www.dw-world.de/dw/article/0,,6035871,00.html

When I was a student at Yale, I was a member of the Party of the Right (POR) in the Yale Political Union (YPU). I was pretty much a libertarian back then, and the POR consisted of libertarians and Burkean traditionalists. John Kerry had been president of the YPU in 1968.  The Political Union consists of several “parties,” which are really little debating/drinking societies. The POR consisted of libertarians and Burkean traditionalists. I was a libertarian. I didn’t much like the guys in charge of the POR.  For one thing, the Burkeans dominated the positions, and they had their little club within the club though they were never man-enough to admit it. Also, the party owned a secret society, which is only open to men ostensibly because it had been a nineteenth-century men’s literary society before the POR took it over.  The trouble is that there are female members of the POR, and they are ineligible for membership in the party’s secret organization. I didn’t like that exclusion even though I am not a woman.  However, the unfairness wasn’t limited to women.  The only guys who were invited into the secret society were those who were in leadership positions of the POR. In the year that I joined the party, the chairman invited me to a Friday night party, which was being held in a room half way up Yale’s bell tower. He told me that the new members of the POR would be inducted into the secret society, so I should come.  So I canceled my other plans and attended. The truth was that he wanted all the party members to be at the party to serve as an audience for the two or three people in the party’s leadership who were actually being inducted. It is no fun being exclusivist if there are none of the excluded around to watch. In other words, the chairman lied to me.  I had changed my plans in order to go to the Friday night party, but it was the lying that really infuriated me when I discovered the actual purpose of the evening.  When I confronted the chairman, he (and his friends in the leadership) denied that he had told me that the new members would be inducted.  Most people who get pissed at the party leadership resign from the party in protest in order to make a point.  I think they overestimate the impact of their “act.”  I, on the other hand, did not resign; I simply ignored the party’s leaders on campus and did not attend any more POR functions.  I think that annoyed the “leaders” more than had I resigned. So even today, I’m a member of the POR, in spite of the fact that I am now very liberal on some issues. In hindsight, I wish I had joined the Progressive Party or the Independent Party while I was still a student, but I really was a libertarian then, and libertarians were in the POR.  The lesson I learned from the POR was how easily people in power can lie. That is a tradition that even the Burkeans can give up.

"The most significant threat to our national security is our debt."
Micheal Mullen, Jount Chiefs of Staff Chairman, August, 2010.

The defense budget in 2010--$664 billion (not counting the Iraq and Afghanistan wars)--equalled that of the rest of the world combined.  One dollar of every five spent by the U.S. Government was for defense. The amount spent represents 80% growth since 2000. Why?  One reason: the big weapon systems oriented to fighting other empires (e.g., Russia and China). For example, $600 million for the littoral combat ship and $13 billion for amphibious landing vehicles (whose purpose has even been questioned by Sec. of Defense William Gates).  It would seem that the military contractors--the military industrial complex, moreover--are firmly entrenched and in control. That is to say, the defense spending is indicative of the influence of big business over government in the United States.  That this influence goes unhampered may tell us something about the leanings of our societal norms.

The House Republicans' "Pledge to America" formulated in 2010 promises to exempt the military from any cost-cutting that might be entailed in reducing deficit spending. Even so, Sen. Tom Coburn wrote, "Taking defense spending off the table is indefensible. We need to protect our nation, not the Pentagon's sacred cows."  This statement is significant because it gets at the problem of the debt and the influence of big business in government.  That is to say, it kills two birds with one stone.  Indeed, these two birds may well be the achilles heel of the United States as a viable entity or going concern.  The fatal flaw may well be within, rather than from an external threat.  This is the meaning of Micheal Mullen's statement above. To be sure, Republicans believe that defense is government's core function. Along with regulating interstate commerce, this is particularly true of the federal government.  It is less true, I would argue, of the state governments.  So the plank can be viewed as primarily federalist rather than in terms of limited government itself.  The probably-unfixable $14 tillion US Government debt and the consolidation of public governance in the U.S. into the federal government at the expense of federalism (and the checks therein) are related; both are indications of a basic inbalance that is unsustainable. In the face of this state of affairs, it is telling that the question in late 2010 was who should continue to get a tax.

Source: Michael Crowley, "The Sacred Cows," <em>Time</em>, December 13, 2010, pp. 55-58.

At the end of 2010, the Vatican created its own financial watchdog and issued new laws to comply with EU standards of financial transparency.  As a state of the EU, the Vatican must comply with EU law and cooperate with EU agencies.  This relationship is one of a religious institution adhering to civil standards.  In other words, the Vatican is both a church and a European state.  According to Gianluigi Nuzzi, the Vatican had typically resisted pressure to reform its bank. "They used to say, 'We're a sovereign state; these are our affairs." However, in September, 2010, Rome magistates seized $30 million from the Vatican bank and placed to of its officials under investigation. However, beyond the pressure from the investigations, the Vatican, as a state in the EU, must comply with EU law, just as American states such as Delaware and Rhode Island must comply with US law.  Yet unlike in the American context, the case of the Vatican brings ecclesastical dynamics into the mix.  No American state is also a church.  Indeed, the first amendment of the US constitution bars government--whether of a state or the union--from establishing a religion.

Source: Rachel Pondio, "Vatican Creates Financial Watchdog and Tough Laws to Meet European Standards," The New York Times, December 31, 2010, p. A9

On Decemer 31, 2010, a Russian judge sentenced Mikhail Khodorkovsky, the Russian tycoon who had been imprisoned in 2003 after defying Vladimir Putin, to an additional six years. According to The New York Times, "It was a politically tinged decision that undermined President Dmitri Medvodev." Leonid Goman of the Right Cause Party in Russia agrees. "It was obviously a political, not a judicial, decision." In general terms, "corruption is endemic, government power is often abused and senior politicians are rarely, if ever, held accountable for misdeeds."  The sentence is an indication that Prime Minister Putin was still in control of Russia.  His message: wealthy businessmen should not interfere in Russian politics.  Khodorkovsky had financed opposition political parties; he was at one time the richest person in Russia, having been one of the oligarchs who bought government assets after the fall of the USSR at a fraction of their worth.

This case points to the importance of separating a judiciary from executive and legislative branches of government. The fragile nature of a judiciary's credibility is also in the mix, as it was undoubtedly diminished by the sentence. While doing the bidding of a powerful government offiical may well be in the short term interest of a judge, such a practice contributes to the downfall of a country's judiciary. The president of a country is charged with presiding over its system of government to protect it as a going concern.  Matters such as the credibility of an entire branch of government ought thus to be on a president's radar screen.  In the case of Russia, the problem was that the Prime Minister may have been running the show and tacitly undermining the president by expediently abusing the judiciary while keeping the president from acting to safeguard the long term viability of the government. Politics over leadership; short-term over long-term. All too often in many countries, presidents do not attend to the overall viability of their systems of government, preferring instead to engage in partisan politics. The Russian case illustrates the cost.

Source: Clifford Levy, "Russia Extends Prison Sentence of Tycoon 6 Years, The New York Times, December 31, 2010, p. A1.

The "ardent glow of freedom gradually evaperates;--the charms of popular equality . . . insensibly decline;--the pleasures, the advantages derived from the new kind of government grow stale through use. Such declension in all these vigorous springs of actions necessarily produces a supineness. The altar of liberty is no longer watched with such attentive assiduity;--a new train of passions succeeds to the empire of the mind;--different objects of desire take place:--and, if the nation happens to enjoy a series of prosperity, volumptuousness, excessive fondness for riches, and luxury gain admission and establish themselves--these produce venality and corruption of every kind, which open a fatal avenue to bribery. Hence it follows, that in the midst of this general contageon a few men--or one--more powerful than all others, industriously endeavor to obtain all authority; and by means of great wealth--or embezzling the public money,--perhaps totally subvert the government, and erect a system of aristocratical or monarchic tyranny in its room. What ready means for this work of evil are numerous standing armies, and the disposition of the great revenue of the United States! . . . All nations pass this parokism of vice at some period or other;--and if at that dangerous juncture your government is not secure upon a solid foundation, and well guarded against the machinations of evil men, the liberties of this country will be lost--perhaps forever!"

Source: The Impartial Examiner, Essay (March 5, 1788), 5.14.15, in Herbert J. Storing, ed., The Anti-Federalist, Chicago: University of Chicago Press, 1985, p. 290-91.