Feb 062004

“In his first 100 days as President, John Kerry will sign an executive order to end influence peddling and secret deals,” Kerry spokesman Mark Kornblau said.

Senator John Edwards proposes new restrictions on lobbyists in an effort to end “the nasty business of influence peddling” in Washington.

Howard Dean doesn’t like influence peddling either. Neither does Bush.

Whatever influence peddling is, everyone’s against it. But what is it?

peddle, v.t., To sell or offer for sale from place to place. Dope peddlers sell dope, toy peddlers sell toys, ribbon peddlers sell ribbons. Pushcart peddlers sell out of pushcarts. “Influence peddlers,” uniquely, buy influence.

“Influence” is also a euphemism, for “bribe.” “Special interests” offer bribes, in the form of campaign contributions; politicians accept them. Lobbyists broker the transaction.

“Special interests” is itself a nice turn of phrase. Where the State can arbitrarily redistribute wealth, where virtually every federal law robs Peter to pay Paul or vice versa, every interest becomes “special” and politics becomes a Hobbesian war of all against all, a race to stick your snout in the government trough. Grandpa Charlie’s interest in free prescription drugs is as special as Archer Daniels Midland’s interest in ethanol subsidies — more so, really, since ADM employs thousands of people while Grandpa Charlie’s operating solo. Oddly, though, ADM is a “special interest” and Grandpa Charlie is not. I have no love for ADM, an especially vile corporate welfare recipient; but under these circumstances every sizable prudent business employs lobbyists to insure, at a minimum, that its own ox is not constantly gored.

One evening a lobbyist for chemical companies tried to explain his job to me. This man was a moral idiot; the interests of his clients circumscribed his universe. He could not, or would not, distinguish between robbing and being robbed, between, say, supporting a subsidy and opposing a regulation. He was no less instructive for that. So many vastly complicated bills come before legislators that they have no idea what they’re voting for most of the time. His job, he insisted, was to inform. He said that it was no secret that he represented chemical companies, that anything he said was discounted accordingly, and that lying is a long-term poor strategy for being listened to. Grossly self-serving; might still be true! And whether it’s true or not, surely the lobbyist, a pathetic figure scratching out his equivocal living, is the least responsible of all the parties involved. To legislate against him is to shoot the messenger.

The problem, if there is one, is that politicians take bribes. The remedy is supposed to be “campaign finance reform.” The abuse of the term “reform” requires an essay in itself, but here it means giving more tax money to political candidates. In other words, legislators, to prevent themselves from taking bribes, vote to pension themselves off, at public expense. This is absurd. Political euphemism makes absurdity plausible.

And not just absurdity, but evil, as Orwell wrote in “Politics and the English Language,” sixty years ago:

Thus political language has to consist largely of euphemism, question-begging, and sheer cloudy vagueness. Defenceless villages are bomabrded from the air, the inhabitants driven out into the countryside, the cattle machine-gunned, the huts set on fire with incendiary bullets: this is called pacification. Millions of peasants are robbed of their farms and sent trudging along the roads with no more than they can carry: this is called transfer of population or rectification of frontiers. People are imprisoned for years without trial, or shot in the back of the neck or sent to die of scurvy in Arctic labor camps: this is called elimination of unreliable elements. Such phraseology is needed if one wants to name things without calling up mental pictures of them.

By comparison “campaign finance reform” is not very serious, and if Orwell were alive he would laugh. Yet the mental fog that surrounds it is very serious indeed. Easy to sneer at “People’s Republics”; harder to put one’s own lingustic house in order.

  22 Responses to “Peddling”

  1. I think influence peddlers are consistent with other peddlers. They’re not buying influence; they’re buying legislation, or at least legislative favor. They’re selling influence — theirs — to their clients.

  2. You’re half-right: it’s legislation that’s bought, and legislation that’s sold. Any "influence" the lobbyists, or brokers, have derives entirely from the cash contributions of their employers. But speaking of "legislation peddlers" would make the nature of the business transparent, and would too squarely place the blame where it belongs — with the legislators.

  3. Business buy politicians, in part, to limit the extent to which politicians buy voters. To that extent, lobbying is a healthy corrective to the system. Of course, business doesn’t mind taking a hand-out as well. Particularly disturbing, however, are the occasions when lobbyists write the legislation themselves. This goes beyond "informing" politicians.

  4. Let’s go beyond the righteous generalities to the specifics of your particular example. Since your lobbyist informant represents chemical companies, there is no way that a regulation is equivalent to "being robbed".

    Chemical companies produce hazardous materials in ways that, if negative public externalities are allowed to accumulate, can lead to either another Bhopal or less dramatically just a lot of extra cancer deaths over the next 50 years.

    Suing them after the fact does nothing; unless they are a multinational, a single big incident puts them in bankruptcy anyway, and for less dramatic incidents the exact genesis of any particular case of cancer is impossible to prove. So governmental regulation of their operating practises and pollution levels is the only way to go. This is one of the areas where libertarian dogma just doesn’t work.

  5. Anyone who thinks "libertarian dogma" can’t handle negative externalities is roughly an epoch behind on the economic literature. (Not that anyone who’d use Bhopal as an example of them can have got very far to begin with. For the record, specific people were identifiably blinded and killed in that incident…)

    If there are no alternatives to regulation, does that mean I dreamt the recent intellectual fashion for propertarian and tradeable-permit responses to problems of environmental externality? If so, perhaps I can become the lionized first exponent of these ideas… not that I consider them a panacea, but somehow, despite a haphazard education, I know of them.

  6. I enclose the rest of my comment on this in Enmail to Jim Henley, in which I predicted Colby Cosh’s morally unserious responses:

    "And I should add, now that I’m writing an Email rather than in a comment box so I can go on a bit longer, that it really doesn’t help when libertarians trot out the next reply that I’ve often heard — that if only the people who ran chemical companies had personal, criminal responsibility for deaths caused by their operations, then use of the ordinary legal system would
    solve the matter. Even without the problems involved in proving liability for a long-ago carcinogen exposure — not to mention those pollutants that
    cause general, regional problems such as smog precursors — it is impossible to run a chemical manufacturing plant without some pollution and often some,
    if very slight, risk of a catastrophic accident. Punishing individuals for running or owning these companies would make it so that the only people willing to take the risk would be shady operators who are willing to risk
    becoming criminals.

    The next thing brought up is usually pollution trading schemes and the like. Of course, these are simply just another form of regulation. They are fine
    for pollutants where all that you care about is the general level released, and not about individual local sources, but they aren’t philosophically any

  7. Actually, the blame must go to the system. In particular a system where the law can destroy your business (or offer you a free living). These things are worth much. Therefore, money will find a way to those who can determine the law.

    It’s like other illegal markets. You can say the crack buyer is the bad one, or the crack seller, or both. But as long as there is a supply of crack, and as long as people love it, you can be sure that people will be filling those two roles.

    Shrink the government back down to its original size, and the corruption would be likewise minimal. Big government necessarily means big corruption.

  8. Leonard: To blame everything on "the system," or the mixed economy, is true in the larger sense, but it lets corrupt politicians off too cheap. Even in a welfare state there is a distinction worth preserving between politicians who sell their votes and politicians who don’t.

    Rich: You’re off-topic but what the hell. You object on the one hand that it is impossible to prove liability for cancers allegedly caused by long-term toxicity exposure and on the other that, if it could be proved, that only "shady operators" would run chemical companies. Damned if you do and damned if you don’t.

    As to the first horn of this supposed dilemma, certain pollutants either cause cancer or they do not. If they do, then it should be possible to establish the fact. If they don’t, then what business are they of the state’s? If they are known to cause an elevated risk but cannot be traced definitively to any particular case, the courts have a well-known mechanism for dealing with this, called class action.

    As to the second horn, regulation does not absolve companies from liability. (In theory perhaps it should, but I heed your exhortation to deal in specifics instead of "righteous generalities.") Companies pay the cost of regulation and are liable for any harm into the bargain. Surely this is the most discouraging environment for running a company that can be imagined.

    I should note, in the spirit of avoiding "righteous generalities," that my lobbyist appeared quite keen on regulation. His clients were large, and a complex regulatory regime helps keep the big on top. It is his clients’ smaller competitors and would-be competitors, who cannot afford compliance, who are being robbed. The business historians who point this out, like Gabriel Kolko, tend to be Marxists, but they’re still correct.

  9. I don’t think it’s off-topic to object to a characterization of regulation as equivalent to "being robbed" in a post where you use the chemical industry as an example.

    For the rest, of course it is possible to prove that a particular chemical is carcinogenic. It is not generally possible to prove that a particular case of cancer was caused by a particular chemical exposure. It is not possible to run the chemical industry with zero carcinogens. Therefore, your suggestion of a class action just moves the decision of how much of a release is permissable from one set of gvernmental employees to another — effectively, you want both legislation and enforcement by judiciary.

    Regulation does, in fact, absolve companies of liability to a great degree. If you can show that you were following approved safety procedures and pollution limits, you are far less likely to have a court case stand up against you.

    Finally, yes, regulation favors large companies. In my opinion, certain industrial processes are inherently dangerous enough so that society has a legitimate interest in not having them run by entities too small to hire people to take the proper precautions.

  10. And we all know that regulation works perfectly, and governments never err:

    "Here is what really happened at love canal:

    The expanding suburbs of Niagara Falls started to encroach on the site, and the local school board sought the land for an elementary school. Far from eagerly proclaiming the now sealed dump as perfectly safe, Hooker initially refused to sell, but the board threatened to use its power of eminent domain. Hooker fully informed the school board of all the risks — including having them present at on-site tests. Nonetheless, the board "bought" the land from Hooker for $1.

    Taylor explains the subsequent damage wrought by the school board:

    "Hooker Electrochemical’s careful attempts to contain the waste and warn of the site’s dangers were immediately undone by the school board. Thousands of cubic yards of the clay cap [laid by Hooker] were scraped away in the course of constructing the school and later during the landscaping of a housing development that was built on the site. The board’s attempted sale of the land in 1957 for residential purposes was vigorously opposed by Hooker."

    Alas, Hooker pleaded to no avail. The land, purchased for one dollar, was sold to developers, and the construction of city sewer lines breached the site. Taylor observes:

    "What we have, then, is not a parable of rapacious, shortsighted capitalists putting profit above public health, but the story of a conscientious company whose best efforts were undone by shortsighted public officials who put immediate political return above the general welfare.""

    Also note that it is far from clear that Bhopal was caused by Union Carbide’s negligence. There is ample evidence that a disgruntled employee deliberately sabotaged the plant.

  11. Floyd McWilliams prefers to attack strawmen. You need not claim that "regulations work perfectly, and governments never err" to claim that regulation is both necessary and better than the available alternatives. McWilliams’ understanding of Bhopal is erroneous; there was no real evidence of sabotage, and the plant design and maintenance were such that a major accident was both likely and impossible to manage. Union Carbide had a similar plant in the U.S. with better safety features; it had a major release of the same chemical as the Bhopal plant shortly afterwards, which did not lead to mass fatalities because training and safety equipment were better.

  12. Rich: It has been settled law since the mid-1960s that regulatory compliance is not a sufficient defense. Merrell-Dow paid out hundreds of millions in Bendectin lawsuits despite the fact that the FDA certified the drug as safe and never changed its mind. A company’s case is far weaker if it doesn’t comply, but that’s self-evident, no? The fact remains that you would impose two costs where I impose one.

    "[L]egislation and enforcement by judiciary" is the last thing I want. What I’m after is strict liability for real damages. In court the plaintiffs at least have to try to prove causation. Regulators labor under no such obligation. I object to class action for many reasons, mostly because it attempts to obviate individual cause and effect and to socialize liability. But we’re stuck with it for the foreseeable future, and it addresses negative externalities far more rationally than prior restraint.

    "In my opinion, certain industrial processes are inherently dangerous enough so that society has a legitimate interest in not having them run by entities too small to hire people to take the proper precautions." "Proper" begs the question. Who determines propriety, the company responsible for whatever harms it might commit, or the government, which has no direct interest in the outcome? Floyd’s examples of the government’s track record in this regard are at least as much to the point as Bhopal is, and they could be multiplied indefinitely.

  13. Well Mr. Pularsky, if if sabotage was not the cause of the Bhopal disaster, then what was? I have read several reports on Bhopal by people vociferously opposed to Union Carbide. They mock UC’s claim that sabotage was to blame, but they have no alternate explanation for how water got into the chemical tank.

    And why is Bhopal an example of the perils of regulation when it was under the regulatory jurisdiction of the Indian government? India has been a socialized, highly regulated state since its inception.

    Regulation will be implemented not by a group of idealistic angels, but by government agencies with rather poor track records. It’s not just third world countries and idiots from upstate New York who have trouble getting it right. Remember the Alar scare, when the U.S. Senate was creating legislation at the instigation of the well-known pathologist Meryl Streep?

  14. I’m afraid the glittering generalities are starting to catch up with the thread again. Aaron Haspel says that he wants "strict liability for real damages", and since he apparently admits that this is impossible to prove for individual cases, he wants class actions. Presumably these are some sort of idealized class actions in which lawyers do not absorb a large fraction of the proceeds. And it’s hardly relevant to bring up a drug liability case: that’s a whole different area, and this thread is long enough already.

    Environmental problems are really all evaluated in the same way, no matter who does the evaluating. Whether it’s smog or cancer, a problem is evaluated by scientists who give some idea of the range of probable risk. At that point, society has to make some decision about how much of this probable risk is acceptible. Whether you hand this judgement over to legislators (and the regulators that they empower) or to judges (through class action or individual tort) you’re not "proving causation" any more one way or the other.

    Finally, Floyd McWilliams’ examples are nonsensical. He gives the example of governmental misjudgement around Love Canal — is this surprising? He’s talking about a local government with no experience with toxics issues, since Love Canal is precisely what brought these issues to the popular conciousness.

    Then he writes about "no idea how water got into the tank" at Bhopal, which only proves that he hasn’t read his source material. Rather that start with citations, I’ll just point out that the design of the tank ensured that this accident was probable; the company could have designed the production line to create less of the chemical at once so that there wouldn’t be a lot lying around in storage, but this was deemed to be less profitable. He writes the India is a "higly regulated" state, apparently confusing the concept of economic regulation with that of environmental regulation.

    Finally, he brings up the "Alar scare". I invite him to look up the toxicoogical evaluation of the dangers of Alar cited in the report that was populazied by Meryl Streep and the same evaluation, by scientists hired by industry, done now. He will see that they are hardly different; Alar is still considered to be just as dangerous as it was. All that happened was that chemical industry lobbyists like the one scorned in Haspel’s post created the idea of a false Alar scare and chose the bogeyman of Meryl Streep, and people like Floyd McWilliams chose to be fooled because it fitted their preconceptions.

  15. Rich: You asserted that "regulation does absolve companies of liability to a great degree." This is false; it has been false for a long time. The legal principle, contrary to your implication, does not vary by business. It was established in an airplane liability case, Wilson v. Piper Aircraft, in 1978 (with precedents dating back at least to the 1920s), and it applies to drug companies, car companies, and chemical companies alike.

    Yes, if only the Love Canal school board had been sufficiently expert! Put the real experts on the job and you end up with the Delaney Clause, which states that nothing can be added to food that has been found carcinogenic in animals at any dosage, when humans are bombarded with carcinogens (and anti-carcinogens) every hour of every day without being much the worse for the wear. Many substances are banned that have not been shown to cause any harm in humans whatsoever; some bans, like that of DDT, have redounded in untold carnage. Experts, not local school boards, were at the helm here too, though the millions of Africans who needlessly died of malaria may not take much solace in the fact.

    You continue to obliterate the distinction between banning a chemical in advance and awarding damages for harm caused by that chemical after the fact. In criminal law it’s the difference between waiting until someone actually commits a crime and locking him up on suspicion. If "society" can decide on "acceptible" (sic) risk in one case, why not the other?

    Reader: The Pepys link is cute, true, and irrelevant. No one has suggested a return to the 17th century.

  16. I am still waiting for Mr. Puchalsky to explain how water got into the tank of MIC if not by sabotage. "The design of the tank ensured that this accident was probable" is a tautology that explains nothing.

    Why do libertarians hate and fear regulation? Well, Mr. Puchalsky castigates Union Carbide because "the company could have designed the production line to create less of the chemical at once so that there wouldn’t be a lot lying around in storage, but this was deemed to be less profitable." Yes, it is considered desirable and profitable to manufacture substances in large quantities. That is how a modern economy works, and I am loathe to have modern industry redesigned by people who think it’s a clever gotcha to point out that Union Carbide could make more money manufacturing pesticide in tons rather than grams.

    Saying that "local government had no experience with toxics issues," implying that Love Canal would never have happened if the New York localities had benefitted from the guiding hand of more experienced regulators, rather misses the point. I object to the Love Canal school board not because it was ignorant, but because it was stupid and wicked. The school board would have had ample access to "toxics issues" if it had bothered to listen to what Hooker Chemical was trying to tell them.

    As for Alar, it is indeed dangerous — if it constitutes 0.5% to 1% of one’s total food intake, a dosage which could only be achieved by eating 14 tons of apples per day. Some of us, being the morally unserious folk that we are, doubt that protection from this danger is worth the millions of Africans who have died because DDT was banned — or, for that matter, the tens of thousands of Americans who died in the 1970’s because the FDA was slow to approve beta blocker heart medication.

  17. I see that we now reached that inevitable point, in any discussion in which libertarian dogma is challenged, in which the libertarians start tossing the kitchen sink in a vain attempt to prove that by God their dogma can handle anything.

    Let’s see, Haspel tries tactic 1; tendentious partial quoting. Does it make sense to cite legal cases triumphantly disproving the contention "regulation does absolve companies of liability to a great degree"? Only if you hope that by now people have forgotten that the quote continued "If you can show that you were following approved safety procedures and pollution limits, you are far less likely to have a court case stand up against you."

    Followed quickly by tactic #2: Let’s pretend that inanimate objects (chemicals, in this case) are people! "In criminal law it’s the difference between waiting until someone actually commits a crime and locking him up on suspicion." Chemicals aren’t people; there is nothing wrong with evaluating them toxicologically *before* they’ve had the chance to potentially kill many people, and banning them then.

    Meanwhile, McWilliams is trying tactic 3; multiply false claims so quickly that no one has the time to refute all of them. Just to stick to Bhopal, since that’s apparently his prime hobbyhorse, he reveals his ignorance by writing "Yes, it is considered desirable and profitable to manufacture substances in large quantities. That is how a modern economy works, and I am loathe to have modern industry redesigned by people who think it’s a clever gotcha to point out that Union Carbide could make more money manufacturing pesticide in tons rather than grams." The chemical that caused the accident at Bhopal was an intermediate, not the final pesticide product. It is possible to design a production process to produce intermediates as needed, rather than in large amounts which are stored for later use. The engineers who designed the Bhopal plant suggested that this be done for safety reasons; they were overruled. Meanwhile, there is no great mystery as to how water got into the tank. A worker was flushing out another tank; he neglected to notice that a connection to the full tank was still open and that water could flow back through it.

    In the original post, you refer to the lobbyist as a "moral idiot". Well, I can only imagine how people think of libertarians who would destroy societal protections based on dogmatic belief, half-digested anecdotes, falsehoods, and an unwillingness to learn the details of any particular subject. Moral cretins, perhaps?

  18. "Where the State can arbitrarily redistribute wealth…"


    What exactly does the word "arbitrarily" mean in this sentence? Or it is a redundancy, given your attitude toward state redistribution of wealth? Do you recognize any state form of state redistribution of wealth not to be arbitrary?

    Also, I don’t see how certain kinds of industrial regulation are any different from criminal law: i.e. why can I make it against the law for you to use, say, my car, for target practice, but I can’t tell a chemical manufacturer he can’t pollute the air I breathe or the water I drink? Would you also throw out criminal law and let the civil courts handle assault, vandalism, murder, whatever? I am not arguing for any particular regulation, but I don’t see how it is an offense to one’s sense of the proper role of government in establishing public limits to private action.

  19. If Mr. Puchalsky, who complained about "tendentious partial quoting," will look way up to my first comment, he will see that I stated "Also note that it is far from clear that Bhopal was caused by Union Carbide’s negligence. There is ample evidence that a disgruntled employee deliberately sabotaged the plant." I did not claim omniscience with respect to what happened at Bhopal; I merely objected to Pularsky’s apparent belief that he could win an argument by throwing around magic phrases like "morally unserious" and "Bhopal". I should have known that it would take more than that to get him to stop his superior tone and moral posturing.

    Colby Cosh objected to Puchalsky’s invocation of Bhopal as a demonstration of why regulation is necessary, noting that a class action suit could have served as a deterrent because "specific people were identifiably blinded and killed in that incident". While it is gratifying that Pularsky, after paragraphs of snottiness and abuse, finally deigned to give an alternative explanation for how the chemical release occurred, it really does nothing to address Cosh’s point.

    I am well aware that the chemical released at Bhopal, MIC, was an intermediate step in the manufacturing process of pesticide. I assumed that it would be understood that the arguments I made about the efficacy of mass production would apply to intermediate stages of production. Apparently that was not the case.

    Pointing out that engineers had safety concerns about manipulating large quantities of MIC sounds impressive, but is really just empty posturing. Of course it is safer to deal with small quantities of hazardous chemicals. The Bhopal plant would have been even safer if all MIC manipulation had been performed in gram quantities by a single worker using nuclear-plant-style robotic arms to handle test tubes. In fact, it would have been safest not to manufacture pesticide at all. This is why I am opposed to regulation: The political process pays attention to the sensationalistic — that MIC is a deadly chemical — but not to the prosaic — that farmers need pesticide if people are to eat.

    Aaron has not claimed that "inanimate objects (chemicals, in this case) are people!" Regulating the use of chemicals must necessarily involve interference with the lives of people who work with chemicals for a living. Newsprint is an inanimate object, not a person; would it be acceptable to force the New York Times to cut their newsprint usage by 90%?

  20. I have put too much time and energy in a silly squabble. I do not want to give the impression that I am opposed to regulation because I think that companies should be allowed to dump chemicals into the air and water. Nor is it the case that I don’t care what horrible things happen to people on the other side of the world who live next to a chemical release.

    Chemical production is inherently dangerous, but the benefits of chemicals are enormous. Therefore any business that manufactures chemicals must choose processes that are reasonably safe but also reasonably efficient.

    How do we determine what is "reasonably safe"? Libertarians contend that if a corporation knows that it can be sued for unsafe behavior, that they will choose to modify their behavior to avoid a massive liability. Let’s call this "liability avoidance." Other people contend that the government should set rules for industrial production, and verify that corporations follow them. This of course is "regulation."

    I contend that liability avoidance is superior to regulation. Liability avoidance is forward looking; regulation is based on the experience of the past. Liability avoidance can be used when dealing with new processes and technology; it is impossible to craft regulation to anticipate future advances.

    Liability avoidance is performed by the people who are on the spot and intimately involved with the manufacturing process. Regulation is performed by someone who works in a government office. Liability avoidance is performed by people who have much to lose if they get it wrong; regulators are never punished for stupid or evil or lazy behavior, and are mostly concerned (if they are concerned at all) with public appearance.

  21. It mystifies me how anyone could claim that a "class action suit could have served as a deterrent" for Bhopal. Bhopal did happen, and a class action suit did not serve as a deterrent.

    Pointing out that the Bhopal plant was originally designed more safely is not empty posturing. The enginneers originally designed it to be safer, but it still would have been profitable. Their design was rejected as part of a tradeoff of safety for increased profitability. Clearly, that tradeoff should not have been made.

    Turning to the more general argument for "liability avoidance", it’s easy to see how this breaks down; I addressed this in perhaps my second reply in this thread. "Liability avoidance" only is a deterrent up to the limit of the corporation’s assets. It is quite rational, though not moral, for a company to compete on price by taking too few safety precautions, and to plan to go bankrupt if a serious incident occurs. And increased use of criminal law (over its current near nonexistence in these cases) may have a deterrent effect, but it also had the effect that you turn over the running of chemical plants to people who are willing to risk becoming criminals.

    I’m starting to have to repeat myself, so this thread has probably come to the end of its useful life. I’ll make one generalization of my own, though; one of the reasons that libertarians never get anywhere politically is their urge for dogmatic completeness. They can’t just say that society should be less regulated — something that a wide range of people might agree with — it has to be that *no* area of society should be regulated. No one wants government by the high school debating team.

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