Political Corruption

Two papers for the price of one! What a deal!

Halliburton and Corruption
It is often difficult, if not impossible, to provide a definition for corruption that remains applicable for every case many may intuit as being corrupt. Even highly publicized cases, like that involving Halliburton, offer a plethora of interpretations. Those who defend the company, its contracts, and its former CEO Richard Cheney often cite “partisan politics” or “difficulties in running a business” or even “patriotism” as justifications for Halliburton’s more controversial business practices.

 The intent of this paper is to look beyond bias and to apprehend, as best as it can, whether or not the label of corruption applies to Halliburton and, if so, how this came to be. As such, the author admits to a certain bias himself, and further admits that such bias is inherent in all human beings. The question here should be, beyond bias, what are the facts, and if those facts serve as an indication towards the validity of claims charging corruption against Halliburton. It should be stated that any such charges of corruption involve a contextual framework, what might be termed certain basic teleological assumptions as to the government, and fair business practices. These assumptions can be enumerated here as; elected officials are elected to serve the interests of the public, and that fair business practices include providing the service one is contracted to do at the price one is contracted to do it.

 Firstly, in regards to elected officials, it should be pointed out that views differ as to the conglomeration of responsibilities inherent in positions of government. Some may argue that the primary responsibility of elected officials is to the common good, while others argue that elected officials must serve their respective constituencies first. Either way, it is understood that representatives have an obligation to the citizenry. It is assumed that, as a representative, one should not use one’s position as a means to garner wealth.

 This assumption is legislated, via numerous laws and ethical codes, to insure that improper behavior (seeking personal wealth) is not pursued. In the case of Halliburton, accusations were made that Vice President Richard Cheney, a former CEO of Halliburton, employed his political office to enrich himself by granting multi billion dollar contracts to a company (Halliburton) in which Richard Cheney owns stock and receives deferred compensation. Whether this poses a conflict of interest, or merely the appearance of a conflict, it should be noted that the possession of stock and deferred compensation packages has had several damaging effects. One effect is an increase of cynicism in the public directed towards politicians, the political process, and how the government conducts business. Another effect is that the time and energy the Vice President spends defending himself from these charges, assuming he is innocent, is time and energy that can not be spent doing the tasks he was elected to do. Yet another effect is how the public may come to view Halliburton, a private company, based on the actions of an elected official. If Richard Cheney has no financial interest in the company, he could possibly apply pressure to subordinates to keep contracts from going to Halliburton, thus removing the perception of wrongdoing. Of course, it is necessary to point out that Halliburton continues to be awarded large contracts, in some cases, without having to submit to a bidding process, one can only guess that the appearance of corruption is not something Richard Cheney is overly concerned with. Yet, if that is so, it should be asked, why should he have bothered to defend himself to begin with? Presupposing Cheney’s motives in this affair would be wrong, as only he knows why he has acted as he did. Perhaps another avenue of investigation would prove to be more illuminating.

 As stated above, this case also entails some interest in fair business practices. There are literally volumes of legal precedents that relate both to business and the nature of contracts. Fortunately, a brief summary shall suffice. A contract is, “an agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law.” (Blacks). For Halliburton, the obligation was to provide the services it agreed to at the price it agreed to. Auditors have, over many months, discovered several cases of accounting irregularities wherein submitted charges were declined. Halliburton was forced to re-submit charges. The company has publicly admitted that it has made errors in billing, sometimes for over one hundred million dollars in one instance, but the company claims that the charges were a mistake, there was no conscious intent to over-charge. 

 One could, as with the Vice President, hope to surmise motives from actions, with disregard for rhetoric. However, this method leaves one open to charges of bias. Assigning motives to a third party is fallacious. That stated, one could reasonably ask, if Halliburton was in the business of doing business with the government, would it not prosper the company, long term, to insure as best it could billing requests that contained a certain conformity, that conformity being that the charges submitted were exact and fair? If Halliburton cannot charge for services without errors, even occasional errors, then the company is failing in its obligations. How can Halliburton fail in its obligations and ever hope to win any more government contracts? Is it because the company’s former CEO is now the Vice President of the United States? 

 This is indicative of a broader problem involving former government employees, be they elected officials or bureaucrats, and lucrative employment opportunities in the private sector. It has often been publicized that Richard Cheney’s first experience in business was as the CEO of Halliburton, a position he garnered after serving as the Secretary of Defense. What is not well publicized is that, in 1991, as Secretary of Defense, Cheney commissioned a Halliburton subsidiary to investigate the feasibility of contracting out non-essential military services to private businesses (Star Tribune). Four years later Cheney would lead the company until he was elected Vice President, after that, Halliburton and its subsidiaries, which had already doubled its earnings while Cheney was CEO, would win contracts for over fifteen billion dollars, seven billion of that being of the no-bid variety.

 It is the contention of this author that Halliburton is emblematic of a larger problem. Neo-Liberal economic policies have lead to a steady increase in privatization and an overall decrease in regulation. This has grown to include various service industries that do business with the government. At one time, members of the military provided the very same services for which companies like Halliburton now receive no-bid contracts. What is lost in this shift towards privatization and deregulation is both accountability and transparency. Government employees are held, by and large, to standards for behavior that do not always apply to their counterparts in the private sector. Add to this the long tradition in the media to discover corruption in the government, and not the private sector itself, and one may wonder what safeguards are in place to insure that corruption is kept to a minimum. 

 Another possible loss, as things go, is efficiency and/or effectiveness in the implementation of public goals. It is not unfair to say that businesses in the private sector are motivated by profit. While, superficially, it may be argued that there is a large interest on the private sector’s part in performing well so as to secure more contracts in the future, however, if upon closer examination it is revealed, such as with Halliburton, that businesses receive contracts because of prior relationships between former government employees and contacts still within the government, such a claim no longer stands. As such, there is little incentive to perform contracted tasks fairly, with the taxpayer in mind. 

 It should be noted that one may argue that this process, the privatization and deregulation of government services, is not corruption, but progress. It is the evolution of government. In reply, it is asked, to what end? The private sector will not adopt standards for service in which the public interest is held to be sacrosanct at the expense of profit margins. For the private sector to do so would require that it no longer be an entirely private enterprise. So too, government and the public sphere can not lash itself to private companies and expect that public needs will be met, not so long as the government is willing to be overly influenced by private companies. 

 While abdication of duties is not necessarily corrupt, if the purpose of a representative democracy is to meet the needs of the people being represented, private enterprise fails to obviate the decline in governmental control as private enterprise is the engine in said decline. It may be that, in the future, the private sector will adopt norms that can serve in place of ethical standards imposed upon elected officials. However, in the age of Enron and Halliburton, those norms have not yet been developed. This is even more troubling, as it is government institutions that could impose standards, yet government institutions seemed geared more towards removing those standards (regulations).

 Why are regulations removed? To shrink government, and thereby further limit its control, and to increase the wealth of the private sector. Government then becomes a tool for profit, while the public it represents is only paid lip service. Thus subverted, the purpose of government is corrupted from its original intent, as a democracy, to better serve the needs of the economic elite. 

 In conclusion, Halliburton is but one example of a systemic problem where the government is an enabler for financial excess in a dysfunctional relationship and where the wealthy become even wealthier at the public’s expense. Elected officials can not serve two opposing masters without becoming corrupt, as corruption is not just each individual act, corruption is the process itself. As elected officials and bureaucrats bind themselves to corporate entities, either to be elected or to gain employment after one’s time in public service, they act for those interests for which they are paid. Why else contribute millions of dollars for campaigns if not to reap billions, why else hire former public servants with no business experience as a new CEO? And if corporate entities be so interested in profits, why expect them to represent the public as the government should? Business elites are not elected by the public, they are not held to the same standards as government employees are, their actions are less transparent than those who serve in government. However, if their influence continues to grow within the government, perhaps the adoption of new standards can rectify the corruption as it exists in government today.

Next, Corruption and U.S. Democracy

In my second paper I argued that, whatever else corruption might entail, corruption also involves the subversion of purposes within a system. That is to say, any system designed to function with a clear intent (purpose) in mind experiences corruption when said intentions are ignored or willfully disobeyed. Note that it may be some systems are, in and of themselves, directly corrupt. In such cases, countervailing behavior in corrupt systems may very well be the most ethical thing to do. For example, National Socialism, especially as practiced within Nazi Germany, was inherently corrupt. Any system which openly or secretly advocates genocide is so morally reprehensible that it is, by its very nature, corrupt. Thus, a document checker in Nazi Germany that accepts a bribe to allow Jews to flee from the country is not committing a corrupt act per se, the system in which he operates upholds unethical norms of behavior as being preferable, thus ignoring or willfully disobeying the ethical norms of Nazi Germany is not, in itself, corrupt.

 This analysis takes the individual act and measures it against the system in which it operates. It is necessary, with such an analysis, to delineate norms as accepted modes of behavior within a particular system. It would seem to follow, logically, that any system that hopes to continue for very long would require the advent of values in furtherance to the design of the system. For example, as a system, a representative democracy would function properly when it champions values that help promote the ideals upon which said system is based. Thus equality, as an ideal, functions via the implementation of “one citizen, one vote”. Thus between the ideal of equality and the practical function of assigning one vote to each citizen, is the value of voting as a duty of each and every citizen. 

 If we examine the system of democracy within the United States, we will discover that the system of government was designed with both a separation of powers between the national and state level, and that, furthermore, the national government was divided into three distinct branches. Later on, attention would be given to bureaucratic arm of government, and steps would be taken to make it both more accountable and transparent. From this we might discern that, as intentions go, the system of democracy within the United States sought to stem abuses of power by literally dividing the centers from which political power originates. If we were to ask why this was done, we might note that it was accomplished with the intent of limiting the corrupting influence of power upon any individual. 

 It would seem then that the founding fathers saw power as being anathema to democracy. This must mean, that corruption to democracy is when too much power is focused on one area to the detriment of the people said democracy is supposed to represent. In other words, corruption in a democratic system is when the personal gain of a few is valued over and above the interests of the many.

 In such cases, democracy is subverted for the profit of a few select individuals. If we were to look at the United States now, we would see several instances where it could be construes that corruption is prevalent. One such instance occurs in the area of campaign finance. As both incumbents and hopefuls must be elected to office, it is required that they campaign for said office. Such campaigns require funding. One might hope that such funds can be found by entirely fair means. Alas, as it so happens, often, campaigns are often supported most by various corporate entities and other large contributors to the detriment of the majority of citizens.

 It may be argued that a democracy should allow for everyone to support potential representatives via financial incentives. Such is the world in which we live, where mass media requires money in which to run for office. Keeping with the democratic ideal of equality, however, there seems to be no reason such support cannot be given equally. This is to say that, allowing for influence to be wrought by a few, to a greater degree than the majority of citizens represented is not democratic. Ideally, the amount that one may contribute should not exceed an amount almost any American may give. This has, to some degree, already been implemented. However, political parties themselves are still free to receive disproportional amounts of money. Noting that the founding fathers saw the potential for corruption in the political sphere, and considering the dominance of only two parties in the American political system, it would seem that the potential for corruption is not only great, it actually exists, as democracy is directly subverted by the effective influence of only two political views. 

 As an example of such corruption on democracy, an argument is presented detailing the homogenization of two formerly competing political views in furtherance of various monetary interests. Early in the twentieth century progressives noted the ill effects of monopolies and price fixing on society as a whole. From increased regulation of the economic sphere came even more regulation as a result of the Great Depression. Government began to take a more hands on approach to society and the economy, going so far as to take over or establish for itself certain industries considered essential to the proper functioning of society. 

 As it stood then, primarily one political party championed increased government involvement, or at least, the continuance of the status quo. For decades afterwards the opposing party, while not ready to completely advocate deregulation and privatization, advocated a balanced budget as a means of insuring fiscal prosperity. For a time, fiscal conservatives and socially minded Keynesians were represented in two distinct poltical parties. 

 Recently, however, the idea of economic neo-liberalization has flourished. Such thinking entails a decrease in government involvement with the economy, despite the hard lessons learned in the twentieth century. Neo-liberalization has been supported by both parties, as evidenced by the various laws passed and signed by Republican controlled legislature and executive as well as a Democratic controlled legislature and executive. No opposing point of view is fairly represented, as both parties have been co-opted by corporate interests, via campaign contributions, to represent those who would profit most from such policies, i.e. the corporate interests.

 Again, this is not democracy as it was intended. The majority of Americans who do not own corporations should also be represented. However, it may be argued that the responsibility of the majority falls to the majority itself, and ultimately, blame for corruption rests on upon said majority. This argument blames the victim for being a victim, and asks the victim to behave more responsibly while not asking the same level of responsibility from the politically powerful. That some elites view the opinions of the majority to be nothing more than the inane rumblings of the mob is a historical fact. The art of sophistry is dedicated to gaining power by directing the majority to follow one’s own goals to detriment of the majority. And while the founding fathers might have thought man at least capable of rational thought, nothing in that prevents abuse of a rational system by semantics and empty words.

 Thus the great weakness in democracy leads it to be distorted. In addition to campaign funds, to run for office in a democracy requires a candidate to make various promises as to how he or she will act. It is the difference between what is said and what is done that reveals corruption. Thus politicians may campaign on family values and supporting families, all the while they may vote as their largest contributors want them to, thus enacting legislation that creates economic conditions which help tear families apart. 

 The difference between stated motives and hidden motives is exacerbated in an atmosphere of journalistic neglect. It falls to the media to keep the public informed, as only with the best information available may the public actually make ‘informed’ decisions. Who controls the majority of media outlets in the United States? Corporations that also contribute a great deal of funds to various political campaigns.
 In such a system the democratic ideal is clearly subverted. In such a system, the political process is inherently corrupt.

A bit long, right?!

I did not read it all, but I did pull out a few statements, whcih I would like to comment on.

Not so fast! I do not consider it corrupt if a past president, for example, makes a lot of money from his memoirs. Does anyone?

I am not offended, either, if an elected representative is paid to write weekly columns for a newspaper or magazine. Even if he would not write them if not elected.

Err. I do not like the use of the “thereby”! Regulations can be removed for other purposes than increasing profits (and, by the way, increasing profits is not per se a bad thing). For example, they can be removed to make things easier and more efficient.

Imagine: assume that a regulation existed that everyone had to show a passport in order to buy a cup of coffee. If that regulation is dropped, then, yes, the profits of teh coffee companies and the cafes would increase. Is that a bad thing?

That’s enough from me for the moment.

First, thank you for replying, I was certain my thread was doomed to languish away without a reply. :stuck_out_tongue:

As to your points.

A former president is not representing anyone but himself. He is, in effect, a private citizen, not a public servant. This would seem to say, alright, other former public employees and representatives should also be free to pursue whatever employment they desire after leaving the public sector.

My argument is that there must be limits. After a certain amount of time (I believe it is one year) public employees of the federal government, after leaving their jobs, are free to work in whatever job they want in the private sector. Many join lobbying groups or businesses seeking bids on government contracts.

In the case of Cheney, for example, after commisioning a company to basically create a multi billion dollar industry providing services to the military, he would transition from being the Secretary of Defense to CEO of the very same company he commisioned. Said company would earn billions of dollars in the industry he helped to create while serving the public.

A conflict of interest is the result of the potential influence for personal gain, on one hand, weighed against the performance of one’s job on the other hand. In the public sector, doing one’s job properly entails a desire to serve the public interest, not the private or self interest. Thus the conflict.

Again, this isn’t something that I made up, or is a rare occurence. Hundreds of millions of dollars are spent each year on campaign contributions and/or lobbying groups, all to partake in the nearly 3 trillion dollar pie that is the various branches of government. This problem is systemic, and it subverts the very ideals upon which this country was founded.

True, for the most part. Though I would point out that hypotheticals could equally be used to demonstrate the need for regulations, to keep mercury or lead out of your drinking water, for example.

My point was not that all deregulation nor privatization is bad, per se. However, when elected representatives are influenced more via large donations to “represent” the interests of the wealthy, beyond the interests of the less wealthy majority, in furtherance of the wealthy, then democracy has failed on a fundamental level. It could be that the interests of the wealthy and a majority of Americans happily coincide. That is fine. What happens when they don’t? And it occurs to me now, why does it seem as though it might be those instances when charges of corruption are raised?

GCT,

Lots of good points in your post. I’m trying to remember now what I wrote in my political science paper awhile back. Ah, okay—money is the root of all corruption. That is why it is the most contentious in debates about political reform and business practices. The soft money is still the no holds-barred-source of political campaign. Lobbying still the most ferocious. Television, the highly priced exposure. Many political observers say that money for political campaign will never be equalized, or on a par (how does one use this expression?)—the already rich candidates will remain those who have significantly more money to spend in campaigns, ever. Any reforms to somehow help the less financially-endowed candidates, so they could have a meaningful shot in the ballot, will remain anemic.

That is of course a problem Arendt. I had a prof suggest once that we make donations anonymous, just as votes are done now (voting was not always done anonymously, back in the day some voter scams involved paying people to vote and when they did they were given a colored card marking their choices. After checking the card and insuring that a person voted as he was asked to do, the voter was then paid for his services).

Making donations completely anonymous would allow for continued support of politicians, the protection of free speech by being able to support said politician, while removing the undue influence attached to money.