Global Policy Forum

Reclaiming the Republic

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Acclaimed author Lawrence Lessig denounces institutions corrupted by moneyed interests - Congress, accounting, financial services, healthcare, academics and the media. He compares institutional corruption with a disease for which the body cannot develop a sufficient immune response. Slowly but surely, corruption as an invidious, systemic wrong destroys the body politic. In this Boston-Review interview, Lessig presents concrete solutions to what he believes to be one of the most dangerous forms of corruption, namely the US campaign-finance system.   

By David V. Johnson

February, 2012

Lawrence Lessig’s latest book, Republic, Lost, represents both a departure from his previous work on intellectual property and an entrance into the world of political activism. He argues that Congress has become so corrupted by moneyed interests and has so undermined the public trust that our very republic is at risk. He seeks nothing less than a complete overhaul of our campaign-finance system. Web Editor David Johnson asks him about Occupy Wall Street, whether transparency is overrated, and whom to invite to a constitutional convention.

David Johnson: Republic, Lost is about institutional corruption in Congress. In reading it, one impression I had is that it’s about so much more than just Congress. It’s really about our society. There are so many institutions that are suffering from the same corruption from moneyed interests.

Lawrence Lessig: Yes, and that’s not an accident. I run the Edmond J. Safra Center for Ethics at Harvard; we have launched a five-year research project focusing on institutional corruption generally. So this problem I describe in the context of Congress is just a particular instance of a more general dynamic in accounting, financial services, healthcare, academics, the media—you can pick your field—and we can describe a similar dynamic of corrupting influences that we’ve allowed to seep into the institution that distract it from what we think the institution is for.

DJ: If this is such a broad-based phenomenon, why isn’t it more obvious to people?

LL: Well, I actually think that outside of the academy it is obvious, but it’s not so obvious that it triggers people to react. I think of a metaphor to certain diseases like sleeping sickness, which the body just can never muster a sufficient immune response, and therefore it slowly brings the body down; that might be the case here. So we’re pretty good as a body politic in responding to a slap like 9/11, we’re pretty good as a body politic in responding to obvious moral wrong—Rod Blagojevich or Randy “Duke” Cunningham—but it turns out we’re not very good at responding to these invidious, systemic wrongs engaged in by people who seem to us to be decent people.

DJ: One slap we have had is the financial crash. And it seems that it has provoked a lot of anger.

LL: The financial collapse is the most astonishing of these examples, not so much because of what happened before 2008, but because of what happened after. Before 2008, the zeitgeist was deregulation, and Wall Street succeeded in getting deregulation. Frank Partnoy calculated for me that in 1980, 98 percent of financial assets traded in our economy were traded subject to the normal rules of transparency, anti-fraud requirements, basic exchange-based rules of the New Deal. By 2008, 90 percent of the assets traded were traded invisibly because they were not subject to any of these basic requirements of transparency and anti-fraud exchange-based obligations.

But the really astonishing thing is that after 2008, after we suffered the biggest collapse since the Depression, after every independent analyst had said there was a link between the structure of deregulation and the collapse, after the dean of deregulation—Alan Greenspan—confessed he made a mistake in assuming that the self-interest of the banks would lead them to behave virtuously rather than behave in a way that would drive to their maximum profit, after all of that, even then, Wall Street was able to blackmail the Democrats and the Republicans into handing them essentially a “Get Out of Jail Free” card and effect no fundamental change in the architecture of our financial system. That is, frankly, terrifying.

DJ: What do you make of the Occupy movement?

LL: The Occupy movement is a wonderful counterforce. But the challenge is for the movement to frame itself in a way that makes it clear that what they’re talking about is not wealth, but wealth procured through this corruption. The protest has a salience on Wall Street not because Americans hate the rich, but because Americans look at that wealth and say, “What the hell? How did you get to profit from the dumbest form of socialism ever invented by man, where we socialize the risk and privatize the benefit? You got to gamble; you got the upside; we got the downside. That’s outrageous.”

And so I think that if the Occupy movement could understand itself to be an expression of this deep frustration with the way our government has been corrupted, if it can say, whether or not you believe in capitalism, nobody believes in crony capitalism, and crony capitalism is what we’ve got, it would stand a greater chance of success. And unless we can find a way to unite across left and right to embrace the fight against crony capitalism, I don’t think we’re going to see any chance to fight against this extraordinary power that can block reform even after the worst financial crisis in 80 years.

DJ: You’ve really tried to make this a bipartisan effort. One thing I’ve noticed with regard to the Tea Party and Occupy Wall Street is that each tends to dismiss the other, even though both sides might find a lot of agreement in their anger.

LL: There is this bizarre blindness. I think we all need to carry around two hats. One of those hats should say, “I’m working for our side.” The other hat should say, “I’m working for the U.S.” And what that means is not “I have to give up my commitment to leftist values or to right-wing values,” but it means that I need to try to figure out if there’s a way, despite our differences, for us to find a unity. If we can’t get beyond the architecture of polarization, we are doomed.

DJ: There used to be a widely accepted norm that politicians, judges, and so on should avoid even the appearance of a conflict of interest. What happened to that norm?

LL: It’s gone through an interesting battle. And that battle begins with people using the word “appearance” and suggesting that appearance means that it’s not real. So when you say it’s just an appearance of a conflict it makes it seem like you’re mistaken in suggesting there’s a problem there. But as theorists of ethics—Dennis Thompson in the most pronounced way—have argued, the reason an appearance of a conflict is a problem is that it produces in the minds of the audience a lack of trust.

And so that is exactly the reason why in the famous case Buckley v. Valeo, where the [Supreme] Court first articulated the right of independent expenditures by individuals in upholding limitations on contributions, the Court said the appearance of impropriety is as important as the actual impropriety. And I think you should go further. I think it’s more important than the impropriety. Because the actual number of instances of congressmen being bribed today is—you know, I would say, the estimate should be zero.

DJ: What do you say to conservatives who insist that “money = speech” and that, therefore, no campaign-finance restrictions are legitimate?

LL: Of course money equals free speech. And we should ask the people who are railing against the idea of money being free speech: “What if congress passed a law, and the Supreme Court allowed it, that said ‘Nobody can spend more than a thousand dollars challenging an incumbent.’”? You’d say, wait a minute, that's a pretty effective way to guarantee an incumbent will always win, and I want to use my money as a way to speak freely about my desire to challenge the incumbent.

The question isn’t whether money is speech. The question is whether we should allow money to so dominate the political system that candidates become more focused on their dependency upon money than upon the People.

DJ: It seems to be widely accepted that there should be public transparency with regard to donations and how they’re spent. But you argue that if transparency is the only norm that’s accepted, it can have perverse negative consequences.

LL: David Donnelly of Public Campaign once made this point really brilliantly: When the Deep Water Horizon accident occurred, it was a great thing that we had that underwater camera in high-def showing us the oil spewing into the Gulf. But anyone who would think that that’s all we need here is deeply confused. What we also want is no sludge dumping into the Gulf, right? It’s the same thing with transparency in politics.

DJ: There’s a wonderful chart in the book that shows how the interests of lobbyists diverge from the interests of the public—issues that get pushed in Congress aren’t necessarily ones that the voting public cares about at all. Free trade, for example. If we had a reformed system, which issues might Congress prioritize or drop?

LL: In the first quarter of this year, what was the number one issue that Congress addressed? In the middle of two wars, a huge unemployment problem, huge budget deficit problem, still issues about health care, still no addressing global warming—what’s the number one issue they addressed? The banks’ swipe-fee controversy. Why do you address the banks’ swipe-fee controversy? There is not one congressman who decided to run for Congress because he thought, “I’m going to deal with the problem of the banks’ swipe fees.” It’s only because if you can dance as a congressman with a little bit of uncertainty of which side you’re going to come down on in this controversy, millions of dollars gets showered down upon you because there’s $19 billion on the table depending on how this issue is resolved. So there Congress is driving the agenda in part because of the fundraising opportunities the agenda produces. If they didn’t have a fundraising opportunity from the agenda like that, they would maybe drive their agenda differently. They don’t spend much time in the current economy of influence on unemployment. But if every unemployed person out there had a democracy voucher [a $50 tax rebate to donate to political campaigns], maybe they would pay a lot more attention to unemployment, because there could be a return from paying attention to unemployment.

DJ: Another point you make is that congressmen are so overwhelmed with how much fundraising they have to do that they literally cannot do their jobs.

LL: The actual activity of fundraising is terrible and nobody really likes it. And it would be kind of comical, if it weren't so tragic, to see them running from Capitol Hill to their little cubby hole with their headsets dialing people they’ve never even met and asking them to give money. It’s really just grotesque.

But the other part about it is the way in which it infects what we imagine a Congress would be there for. If you started in 1794 and looked at our Congress, and compared it to the House of Commons, the two would look pretty much the same—you have people sitting in a room for five or six hours a day while they're in session, debating with each other, arguing about the ideas. Not necessarily that it’s the greatest of the arguments but they’re trying to do what you imagine a deliberative body would do—deliberate. Jump ahead to today, the House of Commons doesn’t look that much different, you still have sessions where everybody’s sitting there and debating, and they have question time where there’s real activity. But switch to C-SPAN covering the U.S. Congress and it’s a completely different picture. You can’t see it, because they don’t allow the camera to pan around, but the hall is empty, people coming to speak just to C-SPAN—they’re not speaking to each other—all of the activity of negotiation and deliberation is done outside the chamber; there’s no deliberation, so you just have to ask, “Why did we create a Congress?” The framers didn’t sit down and set up a Congress so they could imagine these 535 independent contractors all arbitraging fundraising opportunities. If that’s what the institution is, then let’s just shut it down.

DJ: One solution you suggest at the end of the book is a constitutional convention, which seems like an archaic strategy but also sort of fascinating.

LL: The really crazy idea in the book is that the delegates to the convention should be randomly selected—a sort of citizen jury.

DJ: Right. It certainly raised my eyebrows.

LL: It’s going to raise anybody’s eyebrows, naturally. Nobody can argue anybody into the position of believing that that makes sense. The way you convince people that makes sense is you run a whole series of these mock conventions where you do exactly that. California did something close to this in their initiative where they created a deliberative poll around the future of California issues and ordinary citizens were given information, and they came up with really sensible, important ideas. I think if we had a series of those mock conventions in the context of amending the Constitution, it would demonstrate something that I think people forget, which is that politics is the rare sport where the amateur is better than the professional. Because the professional is a professional precisely because the professional is very good at understanding the relationship between what he should do and particular interests that are affected by him and he depends upon. And the amateur doesn’t have that skill. The amateur can be summoned into life in a way that says, “Do what’s right here. Do what you think makes sense.” And if you have the right diversity, a randomly selected representative sample, and you can summon that life into being, I think the product of those types of conventions is much more sensible than the product of a political convention.

DJ: It seems that more and more we hear about committees being formed to solve various crises. And they’re always populated by elites of some sort or other: experts, politicians, lawyers, and so on. But these committees haven’t been very successful.

LL: I think partly because they are these elite committees. I think that we have got to give America something different to look at. The jury is a very important part of American culture and it’s not hard for people to think beyond the jury about the conviction for a murder case to the jury about questions of how the Constitution should change. And I think people would rightly say, “Whoa, you can’t have a jury change the Constitution.” That’s right. But why not have a jury think about what changes there should be to the Constitution and then allow those changes to go out to the States in a way that allows the States to consider them in a deliberate way. It isn’t harmful to have ideas. And I think in fact the ideas would have a certain credibility once they’re understood to be the product not of the factionalized politics that we have everywhere else in government, but instead of a genuine, Athens-like, random expression of what people think about these issues.

DJ: A lot of critics blame the two-party duopoly and claim that the parties share the same interests and that there’s not much difference between them. Do you think they’re right about that?

LL: I understand the appeal to a multi-party system. I’m not convinced by it because I don’t think it takes into account the complexity of divided governments that the U.S. system produces. If we were a parliamentary system, I think the arguments in favor of having six or seven parties would be stronger than they are in the context of a presidential, congressional system. But independent of that, I think that everybody should recognize that parties have been corrupted by the fundraising process. As many people say, “We don’t have two parties, we have one party, the money party.” So if you look at the evolution of views inside the Democratic and Republic parties, there is a strong convergence on views that are key to fundraising. So in the 1990s, the Democratic party becomes as much in love with the idea of deregulating Wall Street as the Republicans. The only place you really see sharp differences is where it might in fact drive fundraising from the ground up. So, social issues, which are really great to fundraise around, become sharp differences between Democrats and Republicans as a way to excite the money base.

DJ: You propose replacing our current fundraising system with one based on small donations from citizens. But are you worried that small donors tend to be people who are especially energized by polarizing issues so that your proposal would lead to a more polarized politics?

LL: It’s a great question. I think that small donors who are giving their own money, might be directed like this. But the plan that I’m talking about is a little bit different. The plan says, let’s rebate the first $50 that you contribute to the federal treasury in the form of a democracy voucher. So, we send you back your first $50, you have a democracy voucher, allocate that as you wish. I don’t know why we should believe necessarily that that’s going to be as skewed.

The other response is, if the thing you’re trying to fix, which is the thing I’m trying to fix first, is the sense of corruption because of the impropriety between the money and the candidate, that’s removed even if the result still is polarized. I have this hopeful picture that we might address both polarization and the inauthenticity of the funding system by small-donor contributions. It might be we just remove the inauthenticity or the skewing effect and don’t deal with the polarization. And that would still be for me enough reason to try to reform.


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