Musk vs. Trump: American Business and Government at Loggerheads?

When the wealthiest person in the world and the President of the United States cross swords, people are bound to notice. Such a very public clash between billionaires, one of whom is the most politically powerful person in the U.S., should not lead the rest of us to infer that the interests of large corporations and the U.S. Government, including the respective executives and elected representatives, typically conflict. Corporate and individual mega-donations to political campaigns, the proverbial “revolving door” between working in government and at a corporation, the reliance of regulatory agencies on information from the regulated companies invite the exploit of conflicts of interest such that legislation and regulations are even written by corporate lawyers for their respective companies’ financial interest. Furthermore, that many very large American-based corporations have interlocking boards of directors gives corporate America considerable unified force in seeing to it that Congress and the federal president remain friendly to business interests. That both benefit from the status quo and have de jure or de facto vetoes of reform proposals reinforces the staying power of the club. Even as U.S. Senator Bernie Sanders enjoyed considerable media attention and crowds in his speaking tour against oligopoly (i.e., consolidation within an industry such that companies can set prices at will and can thus extract extra profit beyond that which would accrue in a competitive market), it would be wildly optimistic to hope for an onslaught of anti-trust enforcement from a Republican or Democratic administration.

The complete essay is at "Musk vs. Trump."

The Tech Industrial Complex

Democracy, Plato and Aristotle both thought, is a governmental system that is most susceptible to the mob—meaning mob-rule. Accordingly, the Electoral College and the appointments of U.S. Senators by state governments, the latter being the case from the establishment of the U.S. Constitution to a few decades into the twentieth century, were meant to limit any damage from momentary passions of the People to the U.S. House of Representatives. The governments in the United States, like those in the European Union, are republics in which democracy is a part rather than the whole. What neither Plato nor Aristotle could foresee in their agrarian city-states is the threat to democracy by plutocracy—the system of government in which private wealth rules. It is less understandable why the American electorates have ignored repeated warnings of the threat, especially as governmental power has concentrated at the federal level since the war between the CSA and the USA in 1861.

The full essay is at "The Tech Industrial Complex."

An Analysis of the 2024 U.S. Presidential Election: On a Party's Self-Serving Elite

The 2024 U.S. Presidential election warrants a post-partem analysis, not so much to affix blame, but primarily so the electorate might grasp the perils when the elite of a political party refuses to apply self-restraint in order to keep the party-wide platform and campaign speeches from reducing to the elite’s own favorite ideology even though it is not held by a significant number of the “rank and file” members (i.e., voters), not to mention independents. In other words, running a massive political party to serve the ideological agenda of what Bertrand Russell calls “the inner ring” can cost a party dearly on election day. I contend that this applied to the Democratic Party, which had become a center-left party still dependent on its non-college, working-class, members, whose cultural values were not necessarily progressive. To be sure, substituting managerially-oriented political calculation for visionary leadership and broad policy proposals that are based on principles rather than particular political interests can easily be perceived generally as small, especially in the context of the horrific military attacks against civilians in Ukraine and Gaza. It is paradoxical that Harris lost working-class voters who were socially conservative, and thus “anti-woke” (e.g., against men in women’s bathrooms and playing in women’s sports) even as she lost some liberals who believed that Harris, in explicitly stating on The View that she would not deviate from Biden, was too timid in standing up to Russia’s Putin (e.g., by withholding long-range missiles) and Israel’s Netanyahu rather than enabling the horrific military crimes against humanity with continued shipments of weapons as if the UN’s court were irrelevant to international law.

The full essay is at "An Analysis of the 2024 U.S. Presidential Election."

Nature Credits in the E.U.

One of benefits of the market mechanism, by which, for example, economic goods are bought and sold, is that self-interest is relied on; people don’t have to be told to buy or sell a product because it can be in their self-interest to do so if the price is right. As an alternative to regulatory standards, a government can create units of pollution-allowance that businesses can purchase so to be lawfully able to pollute in so far as a purchased unit allows. In the E.U.’s emissions trading system, “operators of power plants and factories have to buy tradeable allowances to cover every tonne of carbon dioxide they emit.”[1] Business could buy and sell allowances so as to cover the amount of pollution that is anticipated. In this way, the market mechanism efficiently allocates pollution in line both with the interests of the companies and the public interest—the latter being made concrete in the decision on how much pollution per allowance and how many allowance units to create. Crucially, the company private interests are put within the purview of the public interest; the tail is not directing the dog. In political economies in which political-campaign contributions by businesses are high, especially if unlimited, the tail can indeed wag the dog, such that the public interest is determined by private interests. This is one reason why the Citizens United (2010) U.S. Supreme Court case is so significant. It allows corporations and labor unions to spend unlimited amounts of money on political campaigns and directly on advertisements—both being beneficial to elected officials in positions to curry favor through legislation and regulations favorable to business (or labor). The informal exchanges of political donations and legislation or regulation comprise a market of sorts. So, the market mechanism, which is created or at least regulated by government, can serve for good or ill, from the standpoint of the public interest.  Using the mechanism, such as the E.U. president proposed in 2024, on behalf of ecosystems, is for good rather than ill, and thus using, in effect, the self-interest of farmers could be better than relying on regulatory requirements that farmers expend some money and effort to beef up their local ecosystems.

The full essay is at "Nature Credits in the E.U."

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1. Robert Hodgson, “Von der Leyen Moots ‘Nature Credits’ Market to Avert Ecosystem Collapse,” Euronews.com, September 13, 2024.

When Hollywood Gets Political: Partisan Profits

Entertainment celebrities and businesses alike risk losing customers and thus revenue by taking positions publicly on political issues. Fearing a surge from political parties on the far-right, some large businesses in the E.U. took the unusual step of coming out against those parties, labeling them as “extremist,” prior to the E.U. election in June, 2024. Typically, businesses there limit their political stances to particular issues that bear on core functions. This is a prudent policy, for human beings, being of bounded rationality, can easily translate ideological disagreement into switching brands. Even universities can get bruised by becoming embroiled in a domestic or international matter that is controversial. Hence after the contentious spring semester of pro-Palestine protests at Harvard (and other many other universities), the university’s administration enacted a policy not to take positions on issues in which the core functions of the university are only indirectly touched or are not affected at all. In creating a “marketplace” for academic freedom, universities themselves are best positioned by staying neutral. Although it is tempting for anyone (for oneself or one’s institution) who has access to media to sway public opinion on a political issue, I contend that the immediate self-gratification is usually outweighed by lost revenue and the reputation of being partisan. Applying strict scrutiny to one’s foray into controversial issues is harder to do if some vocal customers are demanding that a position be publicly taken. The silence of other customers, who would “vote with their purse or wallet” were an opposing position to be taken, should not be overlooked.  The singer Taylor Swift and the actor Robert De Niro provide us with two illustrations. Stepping out of their respective domains comes at a cost in those domains, and thus should, I submit, be done prudently and seldom.

The full essay is at "When Hollywood Gets Political."

Will Breakthroughs Save the Planet?

The dire predictions concerning the probable impact of climate change on ecosystems, ocean-levels, and food-production, as well as on our species itself have understandably been made without taking into account the countervailing impact of technology yet to be invented. Instead, the focus has been on governmental, rather than business, efforts aimed at reducing carbon emissions. This too is understandable, as companies have consistently been oriented to their own profits rather than reducing externalized costs, such as pollution. This focus has left the element of technological innovation or invention out of the equation. Moreover, because it is not possible to predict whether our species will have invented technology in time for it to counter the predicted impacts of climate change, relying on such technology so as to obviate the need to act so as to limit or reduce carbon emissions would be foolish and reckless. Put another way, it was irresponsible as of 2020 at least to say that government restrictions on carbon emissions were not necessary because technology will be invented that will substantially reduce emissions or even remove the excess carbon from the atmosphere. This does not mean that such inventions will not be made in time to make a significant positive impact. It is indeed possible, moreover, that our species, homo sapiens, will be saved by its own knowledge after all, even though we do not seem capable of regulating the innate desire for instant gratification even if the species’ survival lies in the balance. An invention by Heliogen in 2019 was such a breakthrough that it was arguably the first invention capable of giving people such hope. That is, the step-forward represented by the invention was such that people at the time could hope that the most noxious future impacts of climate change might not be inevitable.

The full essay is at "Breakthroughs in Climate Change."

The U.S. Justice Department and Facebook: Secretly Mining Personal Information

Collusion between business and government has hardly been a rarity; the extent of secrecy regarding it , however, may be a surprise. Whereas business-government economic partnerships (as well as university-government partnerships) have typically been made public, the extent to which government uses businesses to get information on citizens has hardly been transparent. In spite of a U.S. federal law enacted in 2015, documents released in September of 2019 “show how far beyond Silicon Valley the practice extends—encompassing scores of banks, credit agencies, cellphone carriers and even universities.”[1] The documents, which cover 750 of the half-million subpoenas issued since 2001, reveal that more than 120 companies and other entities received subpoenas for information on customers, users, or students. F.B.I. could lawfully “scoop up a variety of information, including usernames, locations, IP addresses and records of purchases” without a judge’s approval.[2] A gag order keeps the businesses from divulging even the receipt of a subpoena. So much secrecy accompanying so much power is, I submit, dangerous to a republic. In fact, the subtle effects on citizens in the public square can easily be overlooked even if the negative impact on freedom is serious.

The full essay is at "U.S. Government Using Companies to Mine Personal Information."

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1. Jennifer Valentino-DeVries, “Secret F.B.I. Subpoenas Scoop Up Personal Data From Scores of Companies,” The New York Times, September 20, 2019.

2. Ibid.

Hong Kong’s Chief Executive Caves in on a Proposed Extradition Law: Yielded to the Street, Business, or Beijing?

Facing huge violent protests, Carrie Lam, the chief executive of Hong Kong, a semi-autonomous region of China, decided on June 15, to indefinitely suspend her proposal to open extradition to mainland China and Taiwan. As the Chinese government demonstrated during the protests at Tiananmen Square decades earlier, holding a mass protest in China was not among the ways to impeded proposed legislation. Why, then, did Lam seem to cave into the popular protests in Hong Kong?

The full essay is at "Hong Kong's Chief Executive."

Regulating Smoking in China: A Socialist Conflict of Interest

Government ownership and control of a means of production is the standard definition of socialism even if some linguistic revisionists want to redefine the term as merely the control of a business or industry. In short, a government must own the economic enterprises to meet the definition of Socialism rather than merely government regulation of private businesses. Socialism, I contend, involves a structural conflict of interest that a government that both owns an controls an enterprise, industry or even an entire economy may be tempted to exploit for its own ends rather than the public good. The key here is the regulating of that which is owned. Specifically, where a government as owner enjoys the benefit of profit or surplus, that government has a financial interest that can be against the restriction of the produced product. Such a monopolistic restriction could admittedly be warranted by public health or safety, but the gain could also be private in the sense that it is limited to the government and even the personal financial interests of government officials. In other words, the public good can be distinct from a government’s own financial (and related political) interest even as that government is charged with acting in the public interest in part by owning and regulating state enterprises. It is the pivot between the public and private interest that sets up the conflict of interest because the human urge is to go with a narrower, private interest at the expense of the public good. In other words, the very possibility, even likelihood given human nature, that a government would exploit the wider distribution of benefits for the narrower one (i.e., to the government itself) is the basis of a conflict of interest. I argue elsewhere that even the mere possibility renders even an as-yet unexploited conflict of interest inherently unethical. Here, I examine the matter of public health in China as a case of a socialist (in part) government that has had a conflict of interest. 

The full essay is at "A Socialist Conflict of Interest."

Wall Street Snuffed Out President Clinton's Goal of Homeownership for the Poor

It is one thing for the head of a government (or a government’s executive arm) to set a praiseworthy goal that is in the public interest, and quite another thing to rely on the financial sector to implement it. Finance has its own means tied to its own goals, with plenty of greed in the mix. Governmental officials may tend to minimize the potential damage from ego-laden greed to the goals of public policy. Such policy ideally strives for the good of the whole, whereas the goals of a private sector of a part. This could account, at least in part, for the financial crisis of 2008 and the continuing bear market in housing in much of the U.S.

The full essay is at "How Wall Street Snuffed Out Clinton's Goal."

Judge Allows ATT Purchase of Time Warner: Vertical Integration Escapes Anti-Trust Objection

Typically horizontal mergers, as when one company merges with another that makes similar products, have trouble when it comes to anti-trust, restraint of trade, objections. The go-ahead of the ATT merger with Time Warner in mid-2018 suggests that vertical combinations, such as when distributor buys a content-creator, survive on anti-trust grounds. Even if trade is not restrained, another problem is present—that of conflicts of interest. Anti-trust law is oriented to preventing restraint of trade rather than such conflicts. Accordingly, just because the ATT merger survived on anti-trust grounds does not mean that a regulatory gap did not exist at the time.

The full essay is at "Vertical Integration and Anti-Trust Law."

Constricting Debate in the Public Square: The Case of Gun Control

The managements of large corporations attempt and, I submit, often succeed at keeping the most financially threatening alternatives in public policy off the public’s radar by pressuring media and using public relations campaigns. As U.S. president Obama’s health-insurance proposal was being debated in Congress, health insurance companies deftly either kept the single-payer proposal off the media’s discussion or relegated the policy as radical. This term, if stuck to a proposed policy, is the kiss of death in a society of incremental change. Such change, if the only game in town, can unfortunately come to be viewed as constituting major change. The gun-control debate in February, 2018 after the shooting of 17 people at a high school in Parkland, Florida is a case in point.

The full essay is at "The Constricted Debate on Gun Control."

Balancing Company Rights and Worker Security through Public Policy

It would be a cruel joke were an airline to keep the extendable corridor back as the plane’s front door is opened and passengers are pushed out. Not even having a safety net below would neither be sufficient nor fair. When a government gives companies the flexibility to fire workers without yet having in place vocational safety nets, said government acts negligently and perhaps even with partiality to one side of the labor-management duality. At the very least, the flexibility to fire should be held off until the matter of economic security is finalized. 

The full essay is at "Balancing Company Rights and Worker Security."

On the Suitability of Starbucks’ CEO Triggering Conversations on Race

Should a company’s CEO use the vast tentacles of the local retail stores to prompt public discourse on race in America? Even though improving race relations is a good cause, extending a CEO’s personal influence beyond the products societally requires its own justification. For a week in March 2015, baristas at 12,000 Starbucks coffee shops implemented CEO Howard Schultz’s intent to “spark customer conversation on the topic of race.”[1] Schultz even made a video in which he told the baristas how they should steer their respective conversations. If this sounds a bit like George Orwell’s Big Brother in the novel, 1984, the question may be whether such societal influence is legitimate from a position of management in business.

The full essay is at “Starbucks: A Shaky Management Wading into Social Issues.”

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1. Bruce Horovitz, “USA TODAY, Starbucks Tackle Race Relations,” USA Today, March 17, 2015.

The Affordable Care Act Running Up Against Federalism

According to Newsweek, "Conservatives have been quick to declare that "ObamaCare is on life support" in the wake of federal district court Judge Henry E. Hudson's ruling in Virginia that the Affordable Care Act’s (ACA) requirement to buy health insurance is unconstitutional. But in truth Virginia’s attorney general, Ken Cuccinelli, won only a partial victory. He sought to have the entire law overturned, but instead only the section creating an individual mandate was." This is perplexing to me, as the law contains a clause indicating that if any part is deemed to be unconstitutional, the entire act would fall. Clearly, the health insurance industry didn't want to be forced to pay out without being guaranteed the expanded customer base by the U.S. Government.  

The full essay is at "Obamacare and Federalism."

Military Sacred Cows: A Matter of Contrived Camulflage

"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 full essay is at "Military Sacred Cows."

Regulatory Capture Realized: The Oil Industry and the MMS Regulatory Agency

On May 11, 2010,  U.S. Dept. of the Interior Secretary Ken Salazar announced that he would separate the public safety and environmental enforcement side of the Minerals Management Services (M.M.S.) agency from its leasing and revenue collection function. While this move eliminateed the structural conflict of interest in the agency, it might not do enough to protect the regulatory function of the agency’s public safety and environmental enforcement roles.  The regulator can all too easily be coopted, or captured, by the firms it is regulating.

The full essay is at Institutional Conflicts of Interest, available in print and as an ebook at Amazon.