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Government by and for the Elites

September 21, 1997|Kevin Phillips | Kevin Phillips, publisher of American Political Report, is author of "The Politics of Rich and Poor." His most recent book is "Arrogant Capital: Washington, Wall Street and the Frustrations of American Politics."

WASHINGTON — Ask the average American about "fast track" and you'll probably get a questioning response about dog races, stock cars or White House secretaries.

But in Washington, fast track is the name for President Bill Clinton's new proposal requesting Congress to commit itself to look-but-don't touch handling of White House trade legislation. It's shaping up as this fall's biggest debate on Capitol Hill, and the president announced last week that he'll be calling in chips to get it through. Ironically, most of the allies the Democratic president is relying on for this fight are Republicans.

A clue: We're not talking about dog races here. We're talking about what Washington cherishes most: back-room deals, big campaign contributions and bigger favors. And orchestrating trade isn't the only example. The notion that policy should be made by and for the elites, instead of democratically by and for the voters, is spreading like prairie fire. The insiders and experts are taking over. Often even Congress gets pushed aside.

The vaunted $369-billion tobacco settlement deal, arranged by the industry and lawyers in hotel suites rather than through the government, has come unglued. The perception that it was too favorable to the cigarette companies was overwhelming. But the problem goes beyond fast track and tobacco. In the budget arrangement worked out this summer by Congress and the president, the final agreement included tens of billions of dollars of sweetheart deals hardly anyone knew about. Tax lawyers and lobbyists wait for these annual pay-offs like kids wait for Christmas. It's the emerging Washington modus operandi.

Then there's the new bipartisan commission that will be appointed by the president and Congress to "reform" Social Security and Medicare. You can be sure that most of the experts and former officials appointed will represent the establishment--not poor people or pensioners. Bipartisan commissions are becoming favorite devices for taking decisions out of the hands of public opinion and presenting Congress with a done deal for ratification. In a sense, a fast-track equivalent also looms just over the horizon for Medicare and Social Security. Today, several hundred thousand jobs; tomorrow, a rollback of pensions and health care? The parallel is not to be dismissed.

Clinton says the trade fight is about philosophy as well as process. "Free trade," he insists, depends on fast track. Global deal-making requires being able to get the deal through Congress without anyone being able to un-dot the i's and uncross the t's.

He's right, in a sense, about the deal-making. But "free trade" is a bit of a misnomer. Trade arrangements, regulations and favoritisms aren't free. In fact, they're pretty damned expensive. And not a little corrupt in the bargain.

Consider: In the late 1970s, when fast track first came on the scene, the United States had only a small merchandise trade deficit, and only a few hundred foreign organizations, corporations and lobbies had "representatives" in Washington. Now, a dozen or so fast tracks later, the merchandising trade deficit has climbed to $163 billion a year, and almost 2,000 foreign entities and organizations have "representatives" in Washington--lawyers, consultants, economists, lobbyists and former U.S. trade officials--in part to keep it that way. Billions are changing hands in Washington to make certain the $150 billion keeps changing hands globally.

Half the "foreign businessmen" we see on the news getting a $100,000 tour of the Lincoln Bedroom from the president; rubbing shoulders with Vice President Al Gore in a Buddhist temple, or finding out what "foundation" House Speaker Newt Gingrich (R-Ga.) is collecting for are there because--surprise! surprise!--they need some kind of favor or access in selling to the U.S. market. Too bad the press can't tell us how many of them plugged fast track.

The sarcasm is intentional, because fast track is no fluke. Its essence--that the elites know better than the people--has become the hallmark of what can only be described as the erosion of democracy.

Fast track is also an appropriate label for another reason. Economically, it favors Americans already on the economic fast track because of their capital, skills and education: lawyers, lobbyists, financiers, corporate executives, consultants and communicators. Whether it's trade or sweetheart tax breaks, fast track in its many forms--meaning the experts know best--is collectively most disadvantageous to citizens stuck on the slow track because they don't have the capital, the skills or the education.

The list goes on and on. The Federal Reserve Board runs the nation's money and banking system--but not, by laws, for the public as a whole. They work for the financial sector. The nominal obligations that the 12 Federal Reserve Banks have to appoint some directors from consumer, labor and agricultural sectors are being ignored, according to one recent study.

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