There is one constant in the universe that cannot be argued, and it is that “power tends to corrupt, and absolute power corrupts absolutely.” Nowhere is that more obvious than it is with the U.S. Congress and industry bailouts. While Barron Acton concluded his now-famous quote with, “Great men are almost always bad men” – one can easily argue that, in Congress, there are no great men (or women), just 535 varying degrees of badness.
To that point, even the aforementioned would be hard-pressed to exhibit a more truthful example of Acton’s quote than they are currently acting out pursuant to the so-called economic crisis. The amalgamation of complicit irresponsibility that led to the collapse of financial institutions and the auto industry, et al., is the result of spectacularly poor management by industry leaders and facilitated by a calculating, self-absorbed, power-craving government, i.e., a Congress that was eagerly willing to behave in whatever way best entrenched its interest.
Who will forget Treasury Secretary Henry Paulson and President Bush insisting that America would literally end as we know it if Congress didn’t deliver $700 billion of our money to Paulson without oversight, and for him to disperse as he alone saw fit, to save companies that were allegedly on the brink of failure. Accordingly, Congress began an endless parade of public theatrics to convince us that whatever level of bailout they alone decided upon was critically necessary.
Ultimately, they got our money and we didn’t get so much as a cup of coffee, much less a thank you. Now the powers that be are using the same playbook to convince the public that America will experience a catastrophic financial climate if the auto industry doesn’t get our money. The auto industry, like Paulson, wants our money without strings or conditions attached, and Congress is intent on making that happen – well, sort of. Yes, Congress wants to make it happen, but the strings they want to attach will give them rule over an industry they have long wanted to control.
As aforementioned – mismanagement, capitulation and a government eager to become involved in ways and in places it has no constitutional right to are the reasons this momentous financial mess exists. Congress may pretend that keeping the auto industry afloat is what’s best for you and me, but in actuality, it’s about what’s best for them.
Here’s a reality check: The auto industry spent approximately $50 million on lobbyists this past year and contributed another $15 million in campaign donations across the board. There are approximately 35,000 paid lobbyists in Washington, D.C., at large – which amounts to roughly 65 lobbyists per congressional member. I ask you – exactly how has this helped you and me? (Source: Newt Gingrich to Fox News, Dec. 9, 2008)
On May 22 of this year, Rep. Maxine Waters, D-Calif., threatened to nationalize the oil industry because she and our Congress were unhappy with the large profits being made by same. Some argued it was a hollow threat to get the oil industry’s attention, but I argue it was more than that – it was an admittance of Congress’ true desires and intent. Now the daily chants of impending collapse of industry giants is providing Congress the cover needed to do that which they have wanted to do from the beginning.
Congress has taken money from these industries, they’ve been wined and dined, and many of its members profited in untold other ways, but these industries forgot Machiavelli’s warning: “If you dine with the devil, bring a long spoon.”
America is and hopefully will continue to be a free-market economy based on private industry. And to that point – when private industry makes bad business decisions they should pay the price for it – and that price doesn’t entail government, i.e., Congress, using our money to lessen their pain.
Neither does the calamitous decisions made by the now-troubled industries entitle Congress to nationalize (quasi or otherwise) any industry. Congress is unable to control and govern itself. How in the name of sanity are we to believe it can govern industry –save to the extent that it provides them the opportunity to blackmail, extort and dictate the way in which industry does business, how much business can earn and what it must produce?
These businesses should be allowed to fail, reorganize through bankruptcy, or reinvent themselves as something more substantive. They should not have a congressional czar telling them what business decisions to make with our money, nor does the Constitution allow for government to take over or own private industry. Failing industries’ CEOs should be fired, and in some instances they should stand trial for extraordinary mismanagement – as should Congress, President Bush, Paulson, et al.
