Ensuring Everyone Has a Real Say Is Tricky: Bits & Pieces for the Bucket

When I finished Version 0.17 of my model, I realized that I needed a bucket for holding the complexities behind “everyone should have a real say.” Turns out to be a bit more complicated than I thought. So, here’s a dump of the pieces that I think should end up in this bucket.


 

Consumer choice versus having a real say
Choosing from the menu versus helping write the menu
(e.g., choosing your shoe style versus choosing being able to walk to work)

Where do folks choose: as individuals, mobilizing with others, voting (electing politicians versus, for example, participatory budgeting)

Movement Perspective
Mobilizing people versus “ponying up
Nudging Versus Building Power
Your individual action’s affect on other individual actions – increase/decrease percent of folks who act

What does democracy look like: endless meetings versus getting stuff done
democracy (accountability) versus speed – e.g., parklets


For now, I’m going to leave these pieces on the back burner on a slow simmer while I wrestle with other parts of v 0.17.

Drug Companies: Perfecting the Information Virus

The Guardian’s Elliott Ross has been mucking around in Big Pharma’s never-ending quest to make sure that research is slanted their way. It isn’t pretty.

When doctors are deciding which drug to prescribe a patient, the idea behind evidence-based medicine is that they inform their thinking by consulting scientific literature. To a great extent, this means relying on medical journals.

The trouble is that pharmaceutical companies, who stand to win or lose large amounts of money depending on the content of journal articles, have taken a firm grip on what gets written about their drugs. That grip was strong way back in 2004, when The Lancet’s chief editor Richard Horton lamented that “journals have devolved into information laundering operations for the pharmaceutical industry.” It may be even tighter now.

Drug companies exert this hold on knowledge through publication planning agencies, an obscure subsection of the pharmaceutical industry that has ballooned in size in recent years, and is now a key lever in the commercial machinery that gets drugs sold.

The planning companies are paid to implement high-impact publication strategies for specific drugs. They target the most influential academics to act as authors, draft the articles, and ensure that these include clearly-defined branding messages and appear in the most prestigious journals.

Big Pharma has been using the strategy for a while, and they’re getting increasingly brazen. Take the case of Merck, one of the biggest pharmaceutical companies in the world:

In a flow-chart drawn up by Eric Crown, publications manager at Merck (the company that sold the controversial painkiller Vioxx), the determination of authorship appears as the fourth stage of the article preparation procedure. That is, only after company employees have presented clinical study data, discussed the findings, finalised “tactical plans” and identified where the article should be published.

Perhaps surprisingly to the casual observer, under guidelines tightened up in recent years by the International Committee of Journal Editors (ICMJE), Crown’s approach, typical among pharmaceutical companies, does not constitute ghostwriting….

“We’ve never done ghostwriting, per se, as I’d define it”, says John Romankiewicz, president of Scientific Therapeutics Information, the New Jersey firm that helped Merck promote Vioxx with a series of positive articles in medical journals. “We may have written a paper, but the people we work with have to have some input and approve it.”

So the next time some college kid gets caught plagiarizing, maybe instead of kicking them out of college they ought to get him an internship in Big Pharma.

Greedy Bastards vs. Greedy Bastards

Great article in the Huffington Post about the epic battle in DC between retailer lobbyists and bank lobbyists over the fee retailers pay when you use your credit card. My favorite quote:

One frustrated moderate Democratic senator asks to remain anonymous so he can speak freely about his legislative education. “I’m surprised at how much of our time is spent trying to divide up the spoils between various economic interests. I had no idea. I thought we’d be focused on civil liberties, on education policy, energy policy and so on,” the senator says. “The fights down here can be put in two or three categories: The big greedy bastards against the big greedy bastards; the big greedy bastards against the little greedy bastards; and some cases even the other little greedy bastards against the other little greedy bastards.”

You should definitely check out the full article; it’s a good read.

Wall Street Spending As Much to Undermine Reform As They Did to Prevent Its Passage

Exhibit A of why passing good policy isn’t enough, courtesy of Think Progress:

According to an analysis by the Wall Street Journal, the banks’ spending on lobbying in the first quarter of 2011 was actually higher than it was in the first quarter of 2010, when Dodd-Frank was actively being debated:

Wall Street and the financial industry spent more to lobby Washington in the first quarter of this year than a year ago when Congress was writing sweeping financial-overhaul legislation, according to a Wall Street Journal review of lobbying reports released Thursday. [...]

The disclosures show that 26 of the financial firms and trade associations that spent the most in 2010 collectively spent $27 million in the three months ending March 31, a 2.7% increase from the $26.3 million spent in the comparable period in 2010.

When the height of the Dodd-Frank debate was going on last summer, the banks spent $27.3 million over three months, barely more than they spent in the first three months of this year.

Even if we had laws that reigned in how much corporations could spend on direct lobbying, it still wouldn’t be enough. When folks have that much unchecked power they will always find ways to use it — as Georgia found out the hard way in 2002 when Wall Street stomped Georgia after it outlawed predatory mortgages. The only real solution is Checks and Balances.

Dave Roberts: $300 Million Fund to Stomp Anti-Green Dems

Going after players like the Chamber of Commerce is a good idea for greens. But, says Grist’s Dave Roberts, how about also rattling some Dem’s cages?

It would be a terrible mistake for climate hawks to abandon the top-down/money field of battle and decamp entirely to People Politics…. The problem is that greens have been playing the top-down game badly. And it’s not from lack of money — depending on how you tally it up, they spent between $200 million and $300 million just in the last year or so on the climate-bill battle. That’s more than enough money to do some damage, if it’s spent well.

Spending well means inspiring fear. So here’s my proposal:

First, green groups abandon the pretense that they are nonpartisan education groups. It’s a legacy model that makes no sense in current circumstances. The Republican Party has officially and irredeemably aligned itself against public health and a clean energy economy. That’s not greens’ fault — it’s part of a process of the parties ideologically clarifying that’s been going on for decades — but it is what it is. No sense pretending otherwise. That means shifting lots and lots of resources out of 501(c)3′s and into 501(c)4′s and PACs.

Then, green groups all contribute to a common electoral fund. Build up, say, $300 million or so. Be public and explicit about what the money is for: not ads, not canvassing, not clever websites, nothing except primarying the next Dem who f*cks with them on a big priority issue like EPA climate regs. It’s just a big, loaded primary gun.

And then … use it. Take somebody out. My personal suggestion would be the loathsome Joe Manchin. Or if that’s too big a target to begin with, start smaller, with a few state attorneys general, mayors, even school board members. Collect some wins and work up the food chain….

The crucial thing is, the challenges can’t be a half-ass. They have to work — they have to cost someone a seat. They have to be well-planned and well-executed.

Amen!

Greens Go after Chamber of Commerce

A little more than a year ago, I wrote a snarky post about Bill McKibben’s plans for 350.org; it didn’t seem like he had a real analysis of power or a real game plan. A year and a quarter later, it’s a different story. 350.org has merged with 1Sky and Naomi Klein has joined their board. And as far as I can tell, one major reason why Klein has signed up is because 350.org has a new strategy:

But it’s not enough to dreamily imagine the world we want. We also have to confront, head on, the forces that are determined to use their power and wealth to stop us. Which is why 350.org just launched a campaign targeting the deeply anti-democratic influence that major polluters have over the political process in Washington, starting with the biggest fish of them all, the U.S. Chamber of Commerce ( chamber.350.org).

I see this campaign as a breakthrough moment in the history of the climate movement, recognition that the struggles for economic justice, real democracy and a livable climate are all profoundly interconnected. As 350.org founder Bill McKibben puts it: unless we go after the “money pollution,” no campaign against real pollution stands a chance. The same can be said for any progressive goal, from labor rights to net neutrality. As we recognize these (and many other) connections among our various “issues,” I am convinced that a new kind of climate movement will emerge, one that is larger, deeper and more powerful than anything we have seen yet.

Going after the Chamber of Commerce is a really smart idea. In part it’s doing to the Chamber what other folks have been doing to the Koch Brothers: starting to undermine their power by turning them into a lightning rod. But unlike the Koch Brothers, it’s a lot easier to do lots of self-organized actions aimed at the Chamber of Commerce — it has a visible presence in every state and virtually every city in the US.

And unlike the Kocks, 350.org can put economic pressure on the Chamber by pushing Chamber members to quit. Here’s the call to action on chamber.350.org:

Join us in standing with small business owners, local chambers of commerce and people all over the country to declare, “The U.S. Chamber Doesn’t Speak for Me.”

__ I own or represent a business
__ I can help recruit businesses in my area

This is a long way away from Senate vigils.

And at the same time that 350.org is directly messing with the Chamber’s economic base, signing up businesses is a great way to confront the Chamber’s message:

For too long now, much of the media and political establishment have assumed that the US Chamber is the voice of business. That is simply not true. As more companies – large and small – adopt socially responsible and triple bottom line (people, planet, profit) practices, organizations like the American Sustainable Business Council are stepping up to influence public policies at the state and federal level on a wide range of issues.

Now is the time to take on the Chamber not only the around the climate change challenge, but also to build the business case for a broader sustainable economy. Addressing climate change needs to be pursued in a manner that the ‘financial bottom line’ is honored as well as the ‘environment bottom line’ and the ‘social justice bottom line’. Responding to the climate change challenge offers not only a unique business opportunity but also a moment to remake our economy so that people and communities matter as much as profit.

Changing strategy like this is pretty rare. Bill McKibben deserves real props — and your support.

Power Isn't a Stain on the Economy's Fabric, It's Part of the Economy's Fabric

It’s time, says Robert Reich, to drop a Top Hat on the corruption spewed by the market:

In the words of lobbyist Lauren Maddox, “The policy process is an extension of the market battlefield.”

The answer is not necessarily found in broader or stricter “ethics rules” barring specific gifts to politicians. Such rules may have little effect and will not, on their own, restore public trust. Instead, we need to consider how to prevent high-stakes market competition from intruding on political decision-making, to create what might be considered “safe zones” where the market has no influence.

I don’t have a problem with the changes Reich wants to make — public financing, slowing down the revolving door between public service jobs and corporate jobs, etc. But wishing for “safe zones” makes about as much sense as wishing for unicorns (or safe zones patrolled by unicorns).

Take the last healthcare fight. Reich writes:

Doctors squabbled over whether primary-care physicians would get a Medicaid payment boost or a somewhat smaller boost would go to all doctors. Insurers that specialize in higher — cost plans mainly going to unionized companies squared off against those specializing in plans that cater to lower-wage workers on whether taxes should be raised on high-cost plans and at what level the tax would kick in. Middle — sized companies fought against small employers over the size of businesses that will be exempt from the requirement of insuring their employees. And on and on.

Many of these battles continue but have moved into the regulatory process, where different companies, sectors, and industries are seeking rules that advantage them and disadvantage their competitors.

As opposed to when? The only reason we had any chance of a real debate this time is that the Godzilla of the medical world, the AMA, had its monopoly of power broken by the insurance companies a few decades ago. Case in point: from the New York Times in 1965.

The American Medical Association said today that it was placing an advertisement in 100 newspapers to make its position clear on its opposition to health care reform. The advertisement calls health care reform ‘the beginning of socialized medicine.’

What was the AMA trying to nuke? Medicare.

Healthcare is a particularly good case because even if, for example, somehow you magically created a public debate “safe zone,” Big Pharma would still have plenty of indirect influence over it. Remember this charming story from the New York Times last year?

A growing body of evidence suggests that doctors at some of the nation’s top medical schools have been attaching their names and lending their reputations to scientific papers that were drafted by ghostwriters working for drug companies — articles that were carefully calibrated to help the manufacturers sell more products.

I’m not arguing we couldn’t rein in some of the insanity. But it’s ridiculous to that we can treat market power like it’s a stain on public discourse.

In fact, I think this denial makes the problem worse. By pretending that power isn’t an inextricable part of the economy, we undermine building support for the real solution — insuring everyone has a real say by creating Checks and Balances .

Heck of a Job, Wired!

According to Wired’s Spencer Reiss, Copenhagen is too little too late:

The really inconvenient truth: We’re toast. Fried. Steamed. Poached. More so than even many hand-wringing carbonistas admit. According to the National Oceanic and Atmospheric Administration, C02 that’s already in the air or in the pipeline will stoke “irreversible” warming for the next 1,000 years. Any scheme cobbled together in Copenhagen for slowing—forget reversing—the growth of greenhouse gases will be way too little, way too late. In the apt jargon of industry, a hotter planet is already “baked in.”

But fear not — technology will save us!

Coastal communities, for example, will survive not because the world will somehow unite to stop sea levels from rising (it won’t). They’ll survive because they’ll learn to adapt—much as the Dutch have done since the Middle Ages.

I’ve got one word for you, Spencer: Katrina.

I don’t know how anyone could see how our country abandoned our poor brothers and sisters during & after Katrina and think technology will save us. Maybe it’s the “us” where Spencer is having trouble opening his imagination; guys like him don’t worry that our government would abandon them.

But it wasn’t just poor folks of color our country abandoned. Here’s how well we’ve “adapted” to Katrina’s lessons:

Three days before the 4th anniversary of Hurricane Katrina (August 29), a coalition of 17 advocacy groups today urged the U.S. Army Corps of Engineers to honor President Obama’s priority in his budget and campaign “to restore nature’s barriers – the wetlands, marshes and barrier islands that can take the first blows and protect the people of the Gulf Coast.”…

The severity of Katrina’s damage in Louisiana was caused, in part, by the fact that the state has lost 1/3 of its original wetlands – about 2,000 square miles — an area larger than Delaware.

“Scientists agree that these lost wetlands could have helped reduce Katrina’s storm surge,” said Charles Allen, assistant director of the Center for Bioenvironmental Research at Tulane and Xavier Universities and co-director of the Lower 9th Ward Center for Sustainable Engagement and Development. “Wetlands are ‘horizontal levees’ that in many cases are more economical and effective at damage prevention than man-made vertical levees because they absorb storm energy, slow incoming waves, wind, and surge waters. It is widely recognized that we urgently need to restore these wetlands and coastal forests to prevent similar or worse storm damage in the future.”

Despite these facts, four years after Katrina, Congress has been unable to fund major coastal restoration projects it authorized in the 2007 Water Resources Development Act because the U.S. Army Corps of Engineers has not completed the projects’ design and engineering.

In the face of these facts, how can Spencer write:

Ditto the other supposed horsemen of the climate apocalypse. Drought? Check out Perth, on the edge of the Great Australian Desert, where more than a million people keep hydrated with seawater that’s been desalinated by wind power.

Who does he think is going to pay for building a system like this for Africa?

Spencer isn’t completely clueless. At one point he hints at the bigger issue:

But won’t the transition to a warmer world be painful? The honest answer is that we don’t know. It depends on the resources we can bring to bear, technological and otherwise.

But that’s about it.

Look, I love Wired as much as the next geek. But it’s stunning that after decades of political deadlock over stopping global warming, Wired assumes politics will disappear when we try to cope with global warming’s aftermath.

Spencer’s article appeared in the same issue as Wired’s holiday gift guide; here’s my recommendation for Spencer.

The AIG Bailout: What The Fed Might've Done If They Weren't So Gutless

Normally I’m too cynical to get pissed off when I read the news. But reading about how Wall Street’s looting local taxpayers made me so furious I’ve been stewing over how we let ourselves get so screwed. What would’ve happened if Obama had cut a tougher deal right at the start?

Take the bailout of AIG. In a scathing report, Neil M. Barofsky, special inspector general for the Troubled Asset Relief Program, recently charged that the Fed “refused to use its considerable leverage” and instead paid 100 cents on the dollar to AIG’s trading partners. It was in stark contrast to how Obama’s crew handled the banks during the Chrysler bailout (WSJ via Epicurious Dealmaker):

President Barack Obama’s auto task force heard a blunt message early this spring from J.P. Morgan Chase & Co., the largest lender to Chrysler LLC. In any deal to remake the troubled auto maker, Chrysler would have to repay its lenders all $6.9 billion it owed.

“And not a penny less,” said James B. Lee Jr., vice chairman at the bank, in a call to auto task-force boss Steven Rattner on March 29.

The next day, Mr. Obama called the banker’s bluff. The president stepped before a podium to announce that Chrysler could face a disorderly bankruptcy or even liquidation. His meaning was clear: If that happened, the lenders would get nowhere near $6.9 billion.

A few hours later, Mr. Lee called Mr. Rattner back. “We need to talk,” he said.

The banker’s about-face was a vivid example of the government’s tightening grip on a humbled financial industry. Pulling a trick from the hedge-fund playbook, the government used its leverage as the sole willing lender to Chrysler, either in bankruptcy court or out, to extract deep concessions from some of the country’s biggest banks.

Could we have done the same with AIG? Economics of Content says no — leverage doesn’t mean squat if you aren’t willing to use it.

This is also why the Fed paid Goldman and the other counterparties 100 cents on the dollar to terminate their CDS contracts with AIG, which [a Bloomberg article] portrays as some sort of gift to the banks. But the Bloomberg article also relies on the Immaculate Negotiation argument — how, exactly, was the Fed supposed to get the counterparties to agree to take a haircut? The Fed had just demonstrated to the entire world that it wasn’t willing to let AIG file for Chapter 11.

It’s an argument a lot of folks — including Geithner — have used to defend the Fed’s depending-on-the-kindness-of-strangers negotiating strategy.

But if threatening to let AIG fail wasn’t credible, the Fed had plenty of other leverage at its disposal. With Chrysler’s lenders, says investment banker & blogger Epicurious Dealmaker, the government

simply did what any hedge fund driven by fiduciary duty and self interest would have done if it held the reins: it dictated the terms it wanted to see, and it told the creditors to pound sand if they didn’t like it.

What if they’d done the same with AIG? Continue reading

Oaths for "Perfectly Virtuous" Regulators vs Checks and Balances

What happens when an economic model can’t straightforwardly deal with the role of power in the economy? You get bizarre ideas like the one presented in the New York Times.

Gretchen Morgenson, one of the smartest business writers around, asks what we’re going to do about the financial regulators who completely failed us.

Even though calamitous lending practices laid waste to the nation’s economy, surprisingly little has changed about how the financial arena operates and is supervised…. Senior regulators who stood idly by for years as financial firms built their houses of cards have been rewarded with even bigger jobs or are jockeying for increased responsibilities. The Federal Reserve Board, for example, wants to become the financial system’s uber-regulator, even though its officials did nothing as banks made deadly decisions to lend recklessly and leverage themselves to the max….

Yet those in the public sector ask us to believe that regulators who snoozed during the credit bubble will be alert to emerging problems on their beats when the next mania begins.

Her solution: a proposal by Prof. Edward J. Kane.

To bring accountability to regulatory performance, Mr. Kane suggests that financial supervisors take an oath of office in which they agree to perform four duties. First is the duty of vision, under which they would promise to adapt their surveillance practices to respond to the creative ways financial institutions hide their dubious practices. Regulators must also promise to take prompt corrective action, and to perform their work efficiently. Finally, there is what Mr. Kane calls the duty of “conscientious representation,” whereby regulators swear to put the interests of the community ahead of their own….

To ensure that regulators live up to the promises they make, Mr. Kane suggests that inspectors general at each agency be charged with regularly auditing the performance of financial overseers. A crucial component of those reviews would be exploring attempts by regulated entities to influence the officials who oversee them.

In doing so, we could strive for “perfectly virtuous” financial regulators:

“If real world supervisors were perfectly virtuous, they would make themselves politically and financially accountable for the ways in which they exercise their discretion,” he writes. “Perfectly virtuous supervisors would fearlessly bond themselves to disclose enough information about their decision making to allow the community or interested outsiders to determine whether and how badly they neglect, abuse, or mishandle their responsibilities.”

Maybe we could also get the regulators to wear togas?

Oaths and inspector generals vs. Wall Street is like me vs. Mike Tyson — not even a crack addict would have trouble figuring out who’s gonna win.

If you’re going to ratchet down Wall Street’s power to influence regulators, there are only 2 ways to do it: chop way back the size of Wall Street, or create checks and balances. The fact that someone as thoughtful and knowledgeable as Morgenson can’t see that — that she’d write a column about oaths and inspector generals — shows just how big the power blind spot is the conventional economic model.