KUSHNER, BEZOS & THE BAD INFLUENCE MONEY CAN BUY.
Jared Kushner, President Donald Trump’s sonin- law, is now in trouble with a press that once considered him and his wife, Ivanka, the only two reasonable people in the White House inner circle. But he has reportedly discussed policy matters with bankers who were in the process of lending his family company US$500 million. At least the quid in his quid pro quo is hefty. And we know about it, so it can count against his father-in-law in future elections, assuming Trump isn’t being held for ransom in North Korea.
The Economist’s “Lexington” column, in which you can read about these goings- on, notes that almost half of Americans believe “corruption is pervasive in the White House.” Which makes you wonder about the other half. Do they believe corruption is just “common” or “not unusual” rather than “pervasive”?
I don’t want to be more cynical than necessary: Young people may be reading. But you scratch my back, I’ll scratch yours is what politics is pretty much built on, isn’t it? A couple of stories before the Lexington column the Economist writes about Amazon CEO Jeff Bezos mulling over whether to build his company’s 50,000-person HQ2 near Washington, D.C. ( Toronto is one of 20 finalists but, apart from Mayor John Tory, whose job is to be optimistic, does anyone seriously think Amazon will choose a foreign country whose border is about to thicken?)
The gist of the Bezos story is that Washington, D.C., is both a regulator of industries in which Amazon competes and a major buyer of cloud services, of which Amazon is an important provider. If Bezos is nice to Washington, maybe Washington will be nice to Bezos. And it won’t hurt to have 50,000 Amazonians “going to the same country clubs and putting children in the same schools as government officials,” thus constituting a permanent army in the never- ending soft- power struggle for influence and approval. ( It would be an interesting research project to investigate whether the typical Amazon employee or government official with decision- making authority is more likely to belong to a country club, or have his or her children in posh schools.)
Government officials with tenure may be immune to policy requests from country club or PTA friends — unless they fancy a good job in the private sector after their government days are over. But elected officials, senators and congress- people ( as Justin Trudeau would call them) won’t be so standoffish. When Amazon comes calling they’re very likely to know, and Bezos and his staff will be keen to remind them, just what Amazon has done for their constituents lately. No doubt they’ll also talk about what Amazon can do for the country. But it would be naive to deny, not cynical to assume, that the career interests of the elected officials in question will weigh in whatever decision they’re called to make.
In the 1960s and 1970s Senator Henry “Scoop” Jackson of Washington state (where Amazon’s HQ1 now is) was known, to his great irritation, as the “senator from Boeing.” ( The phrase made it into his New York Times obituary, though only at paragraph 30.) Conveniently, he favoured a strong national defence, as did Boeing, a major defence supplier and his state’s largest employer. At one stage, he got into trouble for letting a Boeing lobbyist work out of his office. Would Senator Jackson, who won a couple of important primaries before losing the 1976 Democratic presidential nomination to Jimmy Carter, have been so strong on defence had he come from a state where arming the nation was less important to the economy? We’ll never know.
To be completely cynical for just a moment, back-scratching is a form of barter and therefore an inefficient way of doing business. Cash payments would be best. If Amazon could simply buy political and regulatory support, it could then put HQ2 where it made the most economic sense to do so. Do you ever wonder why we have so many shipyards across the country and why none has the full order book that would help it achieve competitive productivity? The politicians who have ordained it to be this way seem not to have the national interest top of mind. More likely, their concern is with the electoral system. Putting the local shipyard out of business wouldn’t sit well with voters.
Americans don’t want Kushner selling his influence in exchange for half- billion dollar loans or anything else that benefits him personally. But they also don’t want Bezos buying friends with a 50,000-job headquarters. In the end, the only way to prevent government influence from being sold is to reduce it. Get the government out of more things and more things will be decided by competition, not corruption.
AMERICANS DON’T WANT KUSHNER SELLING HIS INFLUENCE. BUT THEY ALSO DON’T WANT BEZOS BUYING IT.