Book Review

'Winner-Take-All Politics'

The mix of money and politics has reached new heights.

November 17, 2011

As the 19th Century turned toward the 20th, one of the major political power brokers was the Ohio republican Mark Hanna. “There are two things that matter in politics,” Hanna said. “The first is money. I can’t remember the second.”

Never were more honest words spoken by a political mover and shaker. Jacob Hacker and Paul Pierson, professors of political science at Yale and Berkeley, respectively, invoke the ghost of Hanna in their best-selling and critically received book, “Winner-Take-All Politics: How Washington Made the Rich Richer—And Turned Its Back on the Middle Class."

They clearly and unequivocally cast blame for our current economic malaise and the growing economic gap between the richest Americans and the rest of America squarely at the feet of our political system and its corruption by special-interest money.

More specifically, the authors claim “the current crisis is merely the latest in a long struggle rooted in the interplay of American democracy and American capitalism.”

Winner-Take-All Politics
Winner-Take-All Politics:
How Washington Made the Rich Richer—And Turned Its Back on the Middle Class
, By Jacob S. Hacker & Paul Pierson. Published by Simon & Schuster.

This interplay in its current form has led to more lip service and less actual commitment to our democratic ideals, and more blind allegiance to the pursuit of wealth regardless of the cost to society as a whole.

By now, only the most ignorant of us can have missed the constant flow of credible analysis and reports that trace and document the massive transfer of wealth that has occurred in the past 30 years—to levels unseen since the late 1920s and the eve of the Great Depression.

As the top 1% of Americans saw their wealth increase by phenomenal percentages, the wages and household incomes for the majority of Americans virtually has been flat. The mix of money and politics is nothing new, but the degree that it occurs today would have Mark Hanna blushing like a Victorian virgin.

Writing in a recent issue of the New York Times, Columbia University professor and author Jeffrey Sachs reported, “Both Parties have joined in crippling the government in response to the demands of their wealthy campaign contributors, who above all else insist on keeping low tax rates on capital gains, top incomes, estates, and corporate profits.

"Corporate taxes as a share of national income are at the lowest levels in recent history. Rich households take home the greatest share of income since the Great Depression. Twice before in American history, powerful corporate interests dominated Washington and brought America to a state of unacceptable inequality, instability, and corruption. Both times a social and political movement arose to restore democracy and shared prosperity.”

The two eras referred to by Sachs were the Gilded Age of the late 19th Century and the Roaring ‘20s of the early 20th Century. Hacker and Pierson explain how we unraveled the reforms that followed those two eras to get to where we are today.

Next: Gradual but great corruption

Gradual but great corruption

The Great Recession and its aftermath have only exacerbated and underscored major tax and policy shifts that have been purposely pursued since the late 1970s.

Simply put, the authors of “Winner-Take-All Politics” reveal a gradual but great corruption of a political system that was never pure in the first place, driven by the rise of special-interest groups and lobbyists, and an astonishing influx of special-interest money into the making or unmaking of laws and regulations.

Lobbyists and special interests have co-existed uneasily with our republic from the beginning. The nation’s Founders struggled with the need to enable freedom of speech and ideas while curtailing the worst but not all aspects of what they called “factions.”

Factions—special interests and political parties—were the subject of James Madison’s Federalist Paper #10. “As long as the reason of man continues to be fallible, and he is at liberty to exercise it, different opinions will be formed,” wrote Madison.

Factions may be unavoidable, but the Founders recognized that uncontrolled they pose a danger to the common good.

In Madison’s view, a representative democracy provides the means to ensure the voice of factions are heard but are directed positively toward what is best for the republic and not what is best for a narrow interest. And therein lies the rub, because Jacobs and Pierson argue that today, factions and their influence benefit the few at a cost to the common good.

Increasingly, factions hide their intent behind the deep pockets of special-interest groups or wealthy individuals. These groups bear lofty and benign names that are Orwellian in their manipulation of language in order to mask their agenda.

They exist to push narrow, divisive, and generally selfish goals. They wrap and thus disguise their intent in patriotic, flag-waving rhetoric and doublespeak that on its face few could object to but whose purpose is to misdirect attention.

Next: Unchecked spending

Unchecked spending

It is hard to believe that the authors of the Federalist Papers—Madison, Hamilton, and Jay—would have supported the U.S. Supreme Court’s narrow but landmark 5-4 decision in 2010 for Citizens United.

That ruling held that the First Amendment prohibits government from censoring political broadcasts in candidate elections when those broadcasts are funded by corporations or unions.

That decision deep-sixed attempts at campaign finance reform and opened the floodgates to unlimited “soft” money from political action committees (PACs), Super PACs, and individuals so long as those entities were not directly tied to a candidate’s campaign.

The 2010 elections were the first elections following Citizens United, and the impact of the court’s decision was clear, according to the nonprofit and nonpartisan investigative journalism group ProPublica.

A greater sum of money than ever flowed through the 2010 campaigns and much of it was provided by new groups that are barely regulated.

Citing a new 2011 report from the Federal Elections Commission, ProPublica claims that independent spending by PACs, groups, and individuals more than quadrupled over the previous election cycle.

Outside spending

Spending by political parties stayed roughly the same, showing that this new campaign-financing landscape is eclipsing traditional party fundraising efforts because these new groups can take in unlimited funds.

The result is independent groups forming a shadow campaign apparatus fueled by unlimited and often undisclosed contributions—without the same accountability required of political parties or candidates’ own PACs.

An example is the unavoidable and constant presence of issue advertising that makes television advertising executives drool over the revenue they bring. Issue ads don’t explicitly endorse candidates but they are terribly effective in swaying voter preferences despite their misleading, negative, and highly subjective tone.

Increasingly, these national shadow groups are pouring money into state and local elections as well, as witnessed by the record amounts of outside money spent on the recall elections in Wisconsin this past spring by corporate interests and unions alike, as well as the successful campaign that overturned recent Ohio legislation affecting public sector union employees.

In Wisconsin, an effort to recall Governor Scott Walker officially kicked off November 15, but a Walker sponsor registered his “intent” to recall Walker on November 1. That trumped the planned kick off and jump started the flow of unlimited and untraceable money in support of the governor two weeks ahead of his opponents.

Next: Crossing the Rubicon

Crossing the Rubicon

The Citizen United case proverbially crossed the Rubicon, but Hacker and Pierson point out that it was the late 1970s when corporate interests first began the gradual but partially successful push back against the political and economic reforms and regulations that characterized first three quarters of the 20th Century.

Those three periods when progressive politics ruled were the Progressive era of the late 19th and early 20th Centuries, the New Deal of the 1930s, and the Great Society of the 1960s and early 1970s.

Conservative and liberal entities alike play the new game, but Republicans have become particularly adept as the power of labor unions has ebbed and the percentage of union members in the private sector workforce has plummeted.

This is true despite recent labor pushback against Republican legislative achievements limiting the role of public sector unions at the state level.

As money spent to influence elections and policy has exploded, Jacob and Pierson address additional influences on the political scene that have coincided with the rise of special interests, and that now work hand in hand with the influence of money to drive special-interest goals.

The emergence of more and more political ads placed on broadcast network television and their local affiliates was a major transformation during in the 1970s and 1980s that altered the traditional election roadmaps. But the rise of network television has now morphed and splintered into multiple cable channels, including cable networks devoted to one political view over another.

While the network news programs still have ratings three times that of the largest cable news provider FOX, as well as MSNBC and CNN, their audience share has dropped from more than 90% 40 years ago to a bit more than 50% in the new millennium.

Increasingly, audiences turn to echo chambers reflecting their point of view at the general exclusion of others. This was called selective perception and selective exposure in the 2008 book, “True Enough: Learning to Live in a Post-Fact Society” by the journalist Farhad Manjoo.

More recently, the Internet and social media have joined television as major conduits that connect politicians to voters.

Lastly, Jacobs and Pierson point to the increasingly sophisticated polling technology that has created a new class of very expensive political consultants whose role is to conduct polls, interpret results, and advise candidates on strategy.

All together, these trends are a formidable force that has substantially altered the dynamics of American politics in favor of special interests.

Jacobs and Pierson dispute the common argument that globalization and technology are the drivers that turned America from “a broadland of shared prosperity” to a “Richistan of hyper concentrated rewards at the top.”

Instead, they argue that domestic policies have mattered more than economics and so a solution to the problem is within the nation’s control. That’s the good news delivered by “Winner-Take-All Politics.”

But one of the key points the authors make is the degree of organization that defines well-entrenched special interests.

And a sophisticated organization can concentrate focus and funnel money to corral lawmakers into supporting a very specific agenda either through direct action or through drift—an intentional policy to do nothing. This is a fundamental political strategy to bring the nation’s capital to a virtual standstill.

There may be no better example than the historic overuse of filibusters to prevent majority rule by forcing the passage of any legislation to have 60 votes in support rather than 51.

Unfortunately, most Americans are woefully unaware of most of what Jacobs and Pierson report either because they pay little attention or only pay attention to the echo chamber of their choosing.

The American novelist and Civil War historian Shelby Foote once said the Civil War was a national failure of compromise, and that compromise is the essential ingredient to a vibrant democracy.

It will be a tragedy if we continue on the current path.

MARK CONDON is CUNA’s senior vice president, business and consumer publishing. Contact him at 608-231-4078.