Buying a financial crisis

Financial deregulation, the root cause of the current economic crisis, did not occur spontaneously. It is thought of as a product of the ascendancy of neoconservative philosophy since the Reagan/Thatcher era, and of course it is, but it took more than the intellectual force of neoconservatism to make it real. It took cash, and lots of it. According to the report "Sold Out: How Wall Street and Washington Betrayed America," by Robert Weissman and James Donahue, it took at least $5.1-billion US.

That's the amount the financial sector spent on federal lobbying ($3.4-billion) and political campaign contributions ($1.7-billion) in the U.S. in the decade leading up to the meltdown. Merrill Lynch alone spent $68 million and Citigroup $108 million. Big money for big rewards. In 2007, the financial sector was engaging 3,000 lobbyists to influence the federal government, more than five for each Member of Congress, and that only includes those officially registered. It doesn't include corporate PR campaigns or state lobbyists. The crisis was well and truly paid for.

This buying of Washington reveals a truth about our North American political systems. They aren't democracies, they are hybrid systems -- part rule by the people at large, part rule by the rich; part democracy, part plutocracy. The plutocratic part not only buys great influence over politicians, but through its control of the mass media, controls political discourse. And this aside from the power it exerts through domination of the economy.

The crisis has once again reminded us of the greatest challenge facing democracy in the 21st century: the struggle to diminish the power of the plutocracy. We need reminding because the plutocracy often exercises its influence in opaque and insidious ways: lobbying in backrooms, for example, and subtly requiring fealty from its media servants. We are currently paying the price for allowing this plutocratic mischief.