Campaign Finance

Steven Hill in the Washington Examiner | 'Use of Public Finance Dollars Raises Concerns'

Communications — Thu, 10 Jul 2008 13:17:00 -0400

...Advocates of public campaign financing were worried the money would not be there for candidates in future years.

“You are setting a precedent of making this a slush fund to fund your favorite projects,” said Steven Hill, director of Political Reform at the nonprofit New America Foundation... LINK

Steven Hill on KCBS | 'SF May Use Election Funds to Balance Budget'

Communications — Thu, 10 Jul 2008 09:14:00 -0400

...”There is a red line around that fund. There is a locked box; you may not go into it, that’s the principal here,” said Steven Hill of the New America Foundation... LINK for audio

Save SF's Campaign Finance Program

Ron Tang — Wed, 02 Jul 2008 05:50:00 -0400

In 2000, San Francisco voters approved a system of public financing of campaigns for the Board of Supervisors, which in 2006 was expanded to the mayoral race. By eliminating the need for candidates to raise large amounts of private money, the program has been extremely successful at helping sever the link between big money and political decisions. But now this flagship program is threatened: Mayor Gavin Newsom is proposing to raid several million dollars from the public campaign fund.

Last September the mayor put forth a plan to take $6 million from the fund and give it to one of his pet programs: SF Promise. The cost of this program was only $525,000 the first year, begging the question of why the mayor was grabbing $6 million from the fund. Of course, Newsom had actively opposed public financing for the mayoral race, so it's possible he wanted to defund the program. Supervisor Aaron Peskin wisely introduced legislation to fund SF Promise from the city's reserve funds, thereby warding off the raid.

Now another proposal has surfaced to remove $5 million from the fund. According to Ethics Commission spending projections, removing $5 million will create a $1.7 million to $4.3 million shortfall for the next mayoral race in 2011 -- and that's just to meet minimum baseline funding.

The justification for this plan is that the city is facing a budget crunch and needs these funds. The mayor promises, promises, promises to return the funds later -- but the only way to legally secure those funds is through a charter amendment, which the Mayor's Office has declined to support.

This latest rationale rings hollow, and we only have to look across the bay to see why. Earlier in the decade, Oakland adopted public campaign funding, and after it was used in one election cycle, Oakland was hit with a budget deficit. The City Council decided to dip into the public financing funds in the gap. They promised, promised, promised that they would restore the funding once the deficit problems were resolved. Yet to this day Oakland still does not have public financing of campaigns -- because, while it's still the law, there's simply no money in the fund.

Meanwhile, in San Francisco, members of the Budget Committee seem to be prepared to vote in favor of this dangerous proposal as early as July 3. While Supervisors Ross Mirkarimi and Chris Daly have wisely expressed opposition, Supervisor Jake McGoldrick, who has been a public financing supporter in the past, has so far expressed support for the cut. McGoldrick could end up being the swing vote, joining with public financing opponent Sup. Sean Elsbernd and mayoral ally Sup. Carmen Chu to support this legislation.

Dipping into the public financing fund for any reason sets a terrible precedent and undermines the integrity of this valuable program. Just as politicians should not draw their own district lines because of a conflict of interest, they should not undermine previously established campaign finance laws.

Mr. Lessig Goes To Washington

Ron Tang — Mon, 16 Jun 2008 06:41:00 -0400

In late March, Stanford law professor Lawrence Lessig came to DC to draw back the curtain on the second act of his career. Lessig, with his placid mien and quiet voice, does not exude the aura of a star, but over the past decade he's become one of the most influential public intellectuals of the Internet age. Along with a small group of activists, legal academics and computer geeks, Lessig has built from scratch a global grassroots movement to reform copyright and intellectual property law. Videos of his lectures are passed along like samizdat by bloggers. "The first time I ever saw him speak," says Cory Doctorow, co-editor of BoingBoing, one of the country's most popular blogs, "I remember having the doors blown off my mind." Fans line up at events with worn copies of his books to ask for everything from signatures to career advice. It is, in the estimation of Aaron Swartz, a 21-year-old programming prodigy who's worked with Lessig since 2001, "a weird kind of celebrity."

Lessig stunned his legions of fans last summer when he abruptly announced he was walking away from the cause that had defined his career. For the next ten years, he said, he would be focusing on a new problem: fighting corruption in politics. So to announce his new venture he'd come to Washington, home to what he considers the most dangerously corrupt institution in the country: the United States Congress. With his new netroots-style reform advocacy organization, Change Congress, Lessig is determined to clean it up.

To many of the Beltway denizens crowded into the over-capacity room at the National Press Club on March 20, Lessig was only a faintly familiar name. Since announcing his new career path, though, he has worked hard to raise his political profile. He endorsed and has campaigned for his onetime University of Chicago colleague Barack Obama. In February, when Congressman Tom Lantos died, Lessig toyed with the idea of running for the seat in the special election. He posted a ten-minute video explaining his platform, centered around campaign finance reform, and set up a website to accept donations. He raised more than $60,000 in just two weeks before ultimately deciding not to run. At this year's Netroots Nation (formerly YearlyKos), the annual convention of the Internet's progressive activists, he will be delivering a keynote address.

Lessig has become enough of a player to merit the attention of the right-wing attack machine. After he showed a clip during a talk of an Argentine artist's video featuring Jesus dancing to Gloria Gaynor's "I Will Survive" before getting hit by a bus, RedState.com, Sean Hannity and Rush Limbaugh all tore into him as "anti-Christian." Fox News even sent a camera to ambush him after he testified at a recent Senate hearing.

Political reporter Thomas Edsall, in his 1984 book The New Politics of Inequality, draws a distinction between two types of reformers in the center-left coalition. The vast majority of interest groups in Washington, from the Sierra Club to the AFL-CIO to Planned Parenthood, are pursuing what Edsall calls "substantive reform" -- attempting to push legislation and enact policies that will provide public goods, protect citizens from harm and redistribute benefits, rights and privileges away from the powerful and toward middle-class citizens and disenfranchised minorities. Then there's a small cluster of about a dozen groups -- Public Campaign, the Center for Responsive Politics and the Sunlight Foundation -- that focus on procedural reform. Rather than trying to win the game, they're trying to change the rules: pushing for broader enfranchisement, more transparency and, crucially, reforms that will reduce the influence of big money on politics.

The procedural reformers, many of whom were in the audience at Lessig's Press Club talk, have some significant victories they can point to over the past several decades, most notably the public financing system set up for presidential elections after Watergate and the Bipartisan Campaign Reform Act of 2002 (aka McCain-Feingold), which banned soft money. Recently, they've had success at the state level, pushing through clean elections laws in Maine and Arizona. But each reform to limit big money in politics is followed by innovations that only increase its role, leading many to conclude that attempting to change the rules is a pointless quest; energy would be better spent on trying to win within the regime. "If you think it's hard trying to get oil companies to pay attention to global warming," Dan Becker, a longtime environmental activist told me, "just try working on getting money out of politics."

What gives Lessig a unique credibility as he embarks on his new career as process reformer is his former life pursuing substantive reform. Before there was Lawrence Lessig, corruption crusader, there was Lawrence Lessig, copyright crusader. In the 1990s, when he started writing about the dangers of a sclerotic, overly restrictive intellectual property regime, few besides industry groups like the RIAA and MPAA and a tiny circle of academics paid much attention. So it was easy, in 1998, for Congress to pass overwhelmingly the Sonny Bono Copyright Term Extension Act, which President Clinton signed into law, extending copyright protections for twenty additional years, bringing the total guaranteed copyright term to seventy years after a creator's death (Since Disney had lobbied strongly for the bill, critics dubbed it the Mickey Mouse Protection Act.)

In the absence of high-profile voices countering the industry groups that dominated the issue, Lessig became an evangelist for the cause of what he calls "free culture." He and his allies argue that cultural vibrance, scientific progress and business innovation all rely on the diffusion of knowledge, a diffusion threatened by an intellectual property regime that attempts to keep that knowledge trapped in a proprietary vault. What they see happening is a modern-day rerun of the eighteenth-century enclosure movement, in which the British commons were brought under private control. But here, instead of using fences to capture land, the private interests are manipulating the law to keep cultural production and the knowledge needed for technological innovation out of the public domain.

Take Disney, for example, which built its entire entertainment empire -- from Snow White and the Seven Dwarfs to Beauty and the Beast -- on the works of others, works in the public domain. But today, if anyone tried to make their own movie based on Mickey Mouse, they'd find themselves on the business end of a lawsuit.

In 1998 Lessig began flying around the country, giving as many as a hundred talks a year at college campuses, and in so doing helped spark a movement. "He developed and refined this really effective speaking style over the years," says Lessig's friend Swartz. Lessig speaks in a halting monotone, while displaying a steady stream of slides with single words or phrases in white set against a black background. The cumulative effect is oddly compelling. Nelson Pavlovsky, a law student at George Mason University, founded the first chapter of Students for Free Culture as an undergraduate at Swarthmore, after watching a video of a Lessig lecture posted on the Internet. Today, Students for Free Culture has twenty-six chapters.

Faced with implacable resistance to copyright reform from big industry groups, Lessig tried a variety of tactical maneuvers. In 1999 he challenged the Bono Act, taking the case all the way to the Supreme Court. Though his friends and colleagues advised him it was unwinnable, Lessig thought the underlying principle so clear, and the Constitution's language about "limited" copyright terms so plain, that he would prevail. But he managed to win only two dissenting votes, from Justices Stevens and Breyer. "He had a terrible reaction to losing the... case," recalls Richard Posner, a seventh circuit judge Lessig had once clerked for. "I told him truthfully... nobody could have won that case. That case was a clear loser. He couldn't accept that. He was terribly upset about that loss."

Lessig didn't wallow for long. He threw himself into starting and promoting Creative Commons, an alternative licensing system that allows creators to specify how other people can use their work, voluntarily giving up some of the rights that copyright automatically reserves. Artists, writers, scientists and others can select from different Creative Commons licenses, which allow the works to be shared, excerpted, reused or re-mixed under certain conditions, for instance, proper citation and credit. Creative Commons' tagline "some rights reserved" is a rebuke of the "all right reserved" tag line that appears under copyrighted works. It's been remarkably successful: more than 90 million works are now licensed under CC, a figure that's more than doubled since 2006.

In the words of fellow cyber-law expert Yochai Benkler, Creative Commons was a way to "jury-rig" a copyright system that embodied free culture values. For all its success, only a tiny percentage of all works generated each year bore a Creative Commons license. Since the Supreme Court has declined to overrule Congress, overhauling the nation's intellectual property regime could happen only by moving legislation through Washington. And Washington had proven too broken.

Lessig's years rolling the copyright boulder up the hill served as the narrative inspiration for his talk at the Press Club. For Lessig, copyright is just one example of the ways money corrupts the Congressional process by preventing Congress from getting what he calls the "easy cases" right. Nearly every expert who's studied copyright term has concluded that it shouldn't be extended retroactively: Milton Friedman once referred to this position as a "no-brainer." But that hasn't stopped big corporations like Disney, which stands to lose a considerable amount of money when Mickey Mouse becomes public property, from pushing through legislation that extends copyright protections for old works.

It's the same dynamic with a host of issues, from the farm bill to the role of contractors in Iraq to an issue Lessig calls "the most profound" we face: global warming. There, the scientific consensus is absolute, the stakes dire and yet action has been routinely thwarted by a coterie of corporations that have a monumental monetary interest in the status quo. "Really, who cares about Mickey Mouse," Lessig told me over dinner the night before his talk. "But if we can't get global warming right? An easy question as fundamental as global warming? Then we're really fucked."

In comparison to saving the planet from immolation, ending donations from lobbyists might seem insignificant, Lessig told the audience at the Press Club. But the problem Congress faces is akin to that faced by an alcoholic. "An alcoholic could be losing his family, his job, his liver," said Lessig. "These are extraordinarily important problems in any scheme of reckoning; these are the most important problems he could be facing. But he will never face and solve those problems until he solves this alcoholism first. This problem that I've described is not the most important problem, it's just the first problem.... We need to solve this problem now."

Sitting in a Washington coffee shop the morning after the speech, distractedly nibbling on carrots and grapes, Lessig seems an unlikely evangelist. "The reason I wanted to be an academic was not because I had some deep romantic idea about teaching or rearing young minds, though that's a great part of the job," he says. It was "just the freedom, just being allowed to say what you believe, write without any of these kinds of restraints in your life."

At 46, Lessig has a boyish face, vaguely reminiscent of Harry Potter. He engages each question with a pursed, furrowed look of absolute concentration before unfurling an alarmingly coherent answer, often beginning sentences with the word "so," which makes it feel like you're encountering him mid-thought and need to catch up. "There's something kind of monkish about him, or austere," Posner told me. "When he taught at Chicago he had an apartment that was extraordinarily bare, like a monk's cell." Lessig is kind of an "ice-capped volcano," says Posner -- his chilly exterior covers a passionate zeal. "He works harder than anybody I have ever met," says Lessig's good friend Alex Whiting. "It's unbelievable."

Lessig likely inherits his work ethic from his father, who owned a steel fabricating company in Williamsport, Pennsylvania, a small town in the middle of the state, where, Lessig says, "the sun shone around twenty-five days a year." As a teenager Lessig took on his father's Goldwaterite politics as his own, and he spent his high school years as an Alex P. Keaton-style "right-wing nut." In 1980 he was the youngest member of the Pennsylvania delegation at the Republican convention, when it nominated Ronald Reagan.

At Cambridge, where he studied philosophy after college, Lessig began a political conversion. "In some sense," he says, "I think that education made it impossible for me to be the kind of narrow, simple conservative that I was." He went on to clerk on the Supreme Court for Antonin Scalia (he was the lone liberal clerk), and has become an outspoken progressive. He was an early supporter of Howard Dean's presidential campaign and invited him to guest blog on his site.

But Lessig's political loyalties aside, his critique is not particularly partisan. His copyright activism originated in the late 1990s, in the wake of the Clinton Administration's industry-friendly Telecommunications Act, and his experience working on copyright and tech policy gives him some perspective on Washington's dysfunctions. For years the most zealous defenders of the interests of the recording studios and film conglomerates have been Democrats. (Perhaps his greatest nemesis -- and eventually a friend -- was Jack Valenti, the late, great Democrat who ran the MPAA and once considered kids who downloaded songs off Napster part of a "terrorist war.")

In the past eight years the collusion between government and business has gotten worse, creating what economist Dean Baker terms the "conservative nanny state." Lessig sees unmaking this state of affairs as the challenge of the era. "There's a speech that Reagan gives in 1965," Lessig says, "where he talks about how democracy always fails because once the people recognize they can vote themselves largess, they just vote themselves largess and the fiscal policy is destroyed. Well, Reagan had it half-right. It's not as if it's the poor out there who have figured out how to suck the money out of the rich. It's exactly the other way around."

In fighting this corporate socialism, Lessig thinks there are allies to be found among the "intellectually honest" right. He points out that the need to raise money from industry provides an incentive to grow government and maintain regulation as a kind of leverage to extract donations from industry. He's made battling earmarks, a conservative cause célèbre, a Change Congress core mission; the first member of Congress to endorse Change Congress was Jim Cooper, a conservative blue-dog Democrat who is eyed suspiciously by the party's activist base. Lessig's touchstone in his conservative outreach is his father, who struggled every year to meet his company's pension obligations, only to learn years later that big companies like Bethlehem Steel had an exemption in the law so they didn't have to meet the same standards. "Now, from my modern political perspective, that's exactly the thing I think is most outrageous about how the government functions," says Lessig. "And from my dad's perspective, that's the most absurd thing about how government functions."

In today's terms, you might call it the Medicare Part D problem: even when Congress starts out with a laudable policy goal, like providing prescription drugs for seniors, by the time the legislation gets through both houses it amounts to little more than a grab bag of giveaways to politically connected business interests. Case in point: the recent Senate-passed Foreclosure Prevention Act, which contains $25 billion in tax breaks for home-builders and other businesses while doing very little to justify its name. The reason for this is straightforward: the amount of money spent on lobbying in the last Congressional session was $2.8 billion, nearly two times more than was spent in 2000. Overall, industry has contributed $14 billion to Congressional candidates in this session.

This money, Lessig says, insidiously distorts Congressional outcomes and priorities because Congress members don't experience it as corruption. "Let's say you go to Congress," says Lessig, "and you believe there are two problems to deal with: piracy of copyrighted materials and welfare mothers who are really getting screwed by the system. You open up shop, and a million [lobbyists] come in and say we've got a thousand things to tell you about piracy, and nobody comes into your office and says we're going to help you with the welfare moms. So you shift your focus, but you never feel it. You think: maybe I could've spent more time on welfare moms, but I'm having a real effect on stopping piracy! That's the dynamic that is so critical here."

Of course, good-government reformers have been decrying the influence of money since at least the late nineteenth century. For all of Lessig's status as a visionary (he literally wrote the book on cyberspace law), what's most striking is that, as he admits, Change Congress doesn't embody any "new ideas." He envisions it as a movement tool kit that connects citizens to the work of the reform groups that already exist, a kind of "Google Maps mashup," as he puts it.

"There have been all sorts of DC-based organizations that have tried to crack this nut, and I think they've hit the limit of what the 'Let's send out an e-mail to our 100,000 members and tell them to write their Congressmen' model can do," he says. "We have an opportunity -- and it won't last long -- to take advantage of the uncertainty that Congress has about how the Net actually works. They don't get it right now. And while they've learned how to ignore 1,000 e-mails, they haven't quite figured out what to do about fifty blogs talking about various legislation or meet-up events. So there's an opportunity to leverage the technology and the irrational insecurity of members of Congress, who look at any objectively insignificant resistance as something to be dealt with immediately."

Ellen Miller, a veteran of campaign finance reform battles, who co-founded the Center for Responsive Politics and Public Campaign and now runs the Sunlight Foundation, says "there was some skepticism" among campaign finance activists toward Lessig's initiative. But, she says, "organizing around issues happens differently than any of the old-line reform groups ever thought it did," pointing to "the online-offline combination, using social media to build a community of people that might have already existed out there [that] Common Cause and Public Campaign couldn't figure out how to reach. He can figure out how to reach them, how to create communities that would have been impossible to find before."

The first feature available on Change Congress's website, modeled loosely on the Creative Commons licensing system, allows citizens, Congress members and Congressional candidates to commit publicly to four pledges -- to refuse PAC and lobbyist money, support public financing, vote to end earmarks and increase Congressional transparency. Candidates who take the pledge can display a badge on their website.

This information will be displayed in a map, which Lessig believes will show in stark terms just how "broad and deep" the consensus for reform is. Take, for instance, the ultimate prize for Lessig and reform allies: public financing of Congressional campaigns. A 2006 poll showed overwhelming support among voters (75 percent) for such a system. The Fair Elections Now Act, introduced by Senators Dick Durbin and Arlen Specter, has attracted eight co-sponsors (including Barack Obama), and Hillary Clinton is on record as supporting public financing in principle if not the Durbin bill specifically. While McCain supported full public financing as recently as 2002, he retracted that position last year. This is not to say we're anywhere close to having public financing enacted -- the interests opposed to it are substantial -- but it is by no means a fringe idea.

In the future, Lessig envisions a Change Congress fundraising arm, modeled in part on EMILY's List, that will allow people to pledge money to Congressional candidates who match their reform preferences and endorse insurgents who challenge incumbents in their party's primary on a reform platform.

In just a month since announcing Change Congress, the organization has raised $500,000 and hired three staff members. But how effective it will be is unclear. Even if it were to succeed in further empowering and connecting the constituency already disposed to support this kind of reform, the challenge is to dramatically increase that constituency and, most daunting, transform process reform into the kind of issue that, like abortion or gun rights, people will base their vote on. "The hero worship may go a long way," said one longtime campaign finance activist. "But those who aren't part of his inner circle are going to be baffled, or they are going to be put off by apparent arrogance." However, she says, "I think technologists achieve a lot because they are blind to that distaste for arrogance, or they just don't care, and they move forward, and that's how they get so much done. They're not trying to be liked; they're trying to create something new."

Though playing David to various Goliaths (armed with a laptop as slingshot) is the defining narrative of Lessig's career, as we finish our conversation in the coffee shop he tells me he feels like he's "never actually... won anything. I constantly feel like, when will I actually deliver?"

Which probably explains why Lessig was tempted to run for Congress. What would be a more quixotic quest than running for Congress as an unknown against a popular local pol? What better venue to prove that process reform can be a real vote-moving issue? After a few supporters organized a Draft Lessig website, he began to consider announcing his candidacy. He hired Joe Trippi and spent $30,000 on an exploratory poll, the results of which were "completely terrible," recalls Swartz. Not only did he have no name recognition but his would-be opponent, State Senator (now Congresswoman) Jackie Speier was "an absolute saint to the district. No matter what you said about her in the polls" -- that she, for instance, took contributions from the same industries she regulated in the State Senate -- "people just didn't care. So it would have been physically impossible for us to persuade enough voters to win, even in a low-turnout special election."

But Lessig gave up the notion of running reluctantly. "We spent a lot of time trying to think if there was some way we could make it work," says Swartz. "There was just no way to break in. It was depressing." Trippi says Lessig's disappointment was evident. "I think he would have relished the opportunity to be out there and try to convince the district -- of seeing if he could beat those odds."

"When I was thinking of running," Lessig says, "the biggest pushback I got was from all these senior politico types who are like, Look, you can never sell process reform; nobody will ever buy it; if that's your message, you cannot win. And my response is, Well, we've got to figure out how to sell it, for Chrissake! It's not like we have a choice."

Democracy Inc.

Ron Tang — Sun, 18 May 2008 08:38:00 -0400

In Thousand Oaks, the owner of a local chain of home improvement stores called Do It Centers is locked in fierce, expensive competition with Home Depot. But the contest has nothing to do with which can offer the lowest prices and the friendliest service, or which will sell you the better chain saw.

No, even though this war is all about business, it's being fought on a political battlefield, and will come to a head on June 3, when the residents of Thousand Oaks vote on a municipal ballot initiative known as Measure B.

Measure B represents a small but growing species of ballot measure, used by businesses to impede their competitors at the polls rather than the checkout counter. As such, the measure is being watched far beyond the city of 127,000 people, with California's planners, developers and full-time initiative industry showing the most interest.

In Thousand Oaks, the true nature of the contest has been partly obscured by the "yes" and "no" campaigns, each of which strains to argue that Measure B has something to do with broader public policy issues.

Supporters portray Measure B as an anti-traffic initiative that would give voters the power to approve or deny future large development proposals to ward off massive traffic jams. Opponents all but claim that Measure B would create a one-city Great Depression in Thousand Oaks by forcing big companies to locate elsewhere, preventing the development of a recreation center and starving Thousand Oaks of the funds it needs for schools and cops.

Two of the state's top political consultants have gotten involved. Most of the town has chosen sides (even the Little Leagues issued endorsements), and business groups and elected officials are divided. Personal insults are being exchanged.

But the claims of each side are so numerous and -- let's be kind -- exaggerated that it might be a good idea for everyone to take a deep breath and examine the most recent campaign-finance filings. These reports, detailing contributions and expenditures in 2007 and in the first 2 1/2 months of 2008, offer a far clearer picture of what's at stake, and for whom.

The "yes" campaign, euphemistically called the Committee to Keep Thousand Oaks Traffic Moving, had received more than $329,000 -- all of it, save a single $150 check, from Do It Center.

The "no" campaign, with the equally meaningless name Citizens for a Strong & Healthy Thousand Oaks, had received more than $400,000 -- every single penny of which comes from Home Depot, a corporate citizen of Atlanta.

If you were to take the campaigns at face value, you would no doubt conclude that it is mighty nice of these companies to spend such large amounts for the causes of good traffic and strong economic health in Thousand Oaks. But skeptics might point out that these firms are a wee bit self-interested.

Take the language of Measure B. The initiative, if approved, would require a vote of the people if a commercial development is more than 75,000 square feet and causes a certain level of traffic congestion. It just so happens that Home Depots are bigger than 75,000 square feet, and so Measure B might slow down or even block Home Depot's proposed new store on the site of a former Kmart not far from the Do It Center on Thousand Oaks Boulevard.

On the flip side, it makes perfect sense that Home Depot, for all its supposed concern about Thousand Oaks, actually opposes Measure B's plan to put development questions in the hands of voters because it prefers to make its deals directly with city councils, which usually can't resist the lure of Home Depot jobs, sales tax revenue and campaign contributions.

Rhetoric aside, voters in Thousand Oaks are being asked a deceptively simple question: In which store would you prefer to shop for hardware? The question may be life and death for a certain tool-belt-wearing demographic. But overall, the answer is far more important to the competing businesses than it is to the future of Thousand Oaks.

Don't feel too bad, Thousand Oaks residents. You're hardly the first city whose ballot has been used as a stage for business-on-business warfare. In the last six years, similar local ballot measure fights have broken out in El Segundo (developer versus developer), Glendale (a mall versus retail developer) and Beverly Hills (hotel versus hotel). In Anaheim last year, a tussle between the Walt Disney Co. and SunCal Cos., a major developer based in Irvine, over the rezoning of a property in the city's resort district triggered two local ballot measures. (After several months of campaigning, SunCal decided not to fund its side of the campaign, and the measures backed by Disney were enacted by the City Council directly and pulled from the ballot.)

Direct democracy in California has its roots in the early 20th century fight between business interests (the initiative process was backed by agricultural and oil interests angry at the shipping rates the railroad was charging). And "ballot box planning," the term for letting voters rather than elected officials and city planners decide land-use questions, is not new either. Since a 1976 U.S. Supreme Court decision declared land-use referendums constitutional, such measures have become a national staple.

From 2000 to 2006, according to a new report from the Initiative and Referendum Institute at USC and the USC-Caltech Center for the Study of Law and Politics, 67 land-use measures involving large-scale development appeared on ballots in communities in 18 states. California, showing its usual leadership, was tops with 22 such measures.

What's changing now, say those who make their living working on these campaigns, is the identity of those sponsoring the land-use measures. For decades, environmentalists and NIMBY types used municipal initiatives and referendums to slow down big-business development projects. Now, after being battered with such measures for so long, businesses are learning to use their tormentors' tactics against competitors.

Harvey Englander, a Los Angeles lobbyist and consultant who is working on behalf of Do It Center in Thousand Oaks, argues that initiatives such as Measure B give local communities more leverage over powerful corporations, with the threat of voters allowing cities to negotiate for better terms on developments. Further, he says, local ballot measures allow companies to protect themselves from unscrupulous competitors that can afford to buy off city councils or planning commissions.

To critics, however, this sounds like a bad update of Clausewitz's maxim on war and politics. Must local ballot measures really be used to conduct business by other means?

Jesse Ruf, the owner of the Do It Center in Thousand Oaks and in eight other locations in California, has been as successful as anyone in navigating the local ballot-measure world. He has fought off competitors twice before in local ballot fights, including an Agoura Hills initiative similar to Measure B that stopped a proposed Home Depot in 2002.

It's hard to look at a California landscape dominated by big-box stores and not feel some sympathy for Ruf's strategy. City governments are eager for the new sales tax revenue that big retail development promises, sometimes at the expense of established businesses like his. Municipal unions often push for new development so city coffers are full at contract time. In many small municipalities, well-connected consultants can so dominate politics that any company that hires them can get its development approved.

But the ballot-measure cure may be worse than the disease. Elections are not cheap, either for taxpayers or for the corporations for which ballot measures have become part of the cost of doing business. Already, Thousand Oaks reports having spent $79,475.57 for economic assessments, traffic analysis and legal fees related to Measure B. (The tally does not include staff costs.) The June 3 municipal special election is expected to cost an additional $50,000.

Although such claims can be overblown, there is a danger that these ballot measures can affect more than the two competing businesses. In Thousand Oaks, the president of Los Robles Hospital and Medical Center has insisted publicly that a section of Measure B that regulates large-scale, noncommercial development could threaten new hospital construction mandated under seismic safety laws.

Can anything be done to reduce the number of such measures?

Utah, in response to a surge of land-use measures in that state, recently passed a law prohibiting voters from pursuing initiatives and referendums on the land-use actions of local governments. But such legislation would stand little chance in initiative-crazy California.

And yes, it would be best if experienced planners and honest city officials, meeting in city halls full of engaged citizens, would decide land-use questions. And it'd be nice if businesses would focus their competitive fire on customers, not voters.

Don't hold your breath.

So here's a more modest request. This is a litigious state in a litigious country. And the California Environmental Quality Act has long provided a way for corporations to frustrate the plans of their competitors. Would it be too much to ask companies to steer clear of municipal ballots and confine their business to the courts?

Maverick Or Maneuverer?

Ron Tang — Mon, 28 Apr 2008 06:05:00 -0400

Ever since "authenticity" became the quality we most value in our politicians, its converse, "hypocrisy," has been the political vice of which we are most conscious. Thus, those who have noticed that Sen. John McCain enjoys a reputation as a "maverick" who "stands up to special interests" while leading a campaign that is operated and funded entirely by lobbyists have seen this as a contradiction. Is McCain a hypocrite, or perhaps a divided soul, with the angelic maverick voice of reform perched on one shoulder and a diabolical little influence-peddler on the other? Who, journalists ask, is the real John McCain?

But just to ask the question in this way is to misunderstand not only McCain but the nature of lobbying, power, and the way concepts like "reform" and "maverick" are tamed and warped in Washington.

Most heavily lobbied fights, especially over the telecom regulations that come before the Commerce Committee, which McCain chaired for years, and the billion-dollar contracts scrutinized by the Armed Services Committee, where he also serves, do not pit special interests against the public interest. They are battles among very wealthy people and companies over which of them will get much richer through a publicly conferred advantage. It's easy to be a maverick standing up to one special interest while serving the interests of another.

Those who credit McCain with "a solid record on reform," like Joan Claybrook of Public Citizen, often cite McCain's investigation of the contracting process for a fleet of Air Force tankers, which sent several Boeing executives and Department of Defense procurement officials to jail. While the wrongdoing McCain exposed was real, his achievement is colored by new information that several of the lobbyists closest to him and who now staff his campaign were employed on behalf of Boeing's competitor for the contract, the parent company of Airbus.

McCain also discovered a unique means of exercising power during the Bush years, after almost two decades as a notably ineffectual legislator. When bipartisanship and common sense were scarce resources, McCain realized he could effectively corner the market on both. Wherever there seemed the possibility of a deal -- on climate change, immigration, taxes, or torture -- McCain swept in to position himself as the one Republican ready to break with party orthodoxy and negotiate. Many of his compromises fizzled, but in other cases, by grabbing the center chair even on issues well outside the purview of his committees, he was able to work a deal that was acceptable to his K Street allies or to the White House, as he did on the torture bill. Even when nothing came of these efforts, he was able to block anyone else from taking that center spot, perhaps someone who might have done more with the opportunity.

For a lobbyist, having an ally in that critical swing position is far more valuable than having a blind loyalist on one side of the table. The role was invaluable for McCain -- making him, for a time, the second or third most powerful figure in Washington -- but also for his lobbyist allies. Consider: If you were lobbying for an industry that wanted to avoid regulation under some new climate-change legislation, whom would you rather have as your friend when the deal is cut? A fanatic who rejects all evidence of human-made climate change, such as Sen. James Inhofe? Or a legislator known for bipartisanship, who will be in the room at the end with the power to shape or break the deal by walking away?

McCain's role in campaign-finance and lobbying reform epitomizes his political success -- and his programmatic failure. While passing the Bipartisan Campaign Reform Act in 2002 was a remarkable feat of political maneuvering, the act has done little to moderate the role of money in politics -- after all, the worst scandals in congressional history arose after its passage. Its most notable effect was to give McCain virtually total control over the reform "movement" (a poor word for a group of understaffed Washington offices), blocking more ambitious opportunities to change Washington from the outside. While his own reform agenda is now minimal -- he still says he wants to limit the independent groups known as 527s, although his campaign cannot succeed without them -- many reform groups are so devoted to him that they remained painfully silent when McCain gamed the public-financing system for the primaries, taking a loan based on public financing while avoiding the system's spending limits.

There is no paradox, contradiction, or hypocrisy in McCain. He's a straightforward Washington creature, one who figured out some new ways to exercise power on behalf of the usual interests.

Ballots and Wallets

Ron Tang — Tue, 19 Feb 2008 00:00:00 -0500

Which detergent do you use? Procter & Gamble spent $3.3 billion on media in 2006 to get customers to buy its products. Which beer will you opt for at the end of a long day's work? Beer marketers spent $1.2 billion during that same year to influence your choice. Who will you pick to be your next president? That's another costly decision: The two major parties are expected to blow a combined $1 billion during this election cycle in their quest to land the $400,000-a-year gig.

The Trans-Atlantic Clash over Political Economy and Fulcrum Institutions

Ron Tang — Tue, 01 Jan 2008 00:00:00 -0500

While the United States and Europe share much in common, they also exhibit basic differences, an "American Way" and a "European Way," that are diverging and had been leading to frequent clashes even before the U.N. rift over Iraq. In a globalized capitalist world, where all nations are seeking models of development that allow "life, liberty and the pursuit of happiness" for its people, this clash within the West is every bit as elemental as the clash with Arab-Islam because it is multidimensional -- economic, political, social, and international in scope. Few in the world wish to emulate the "Arab-Muslim way," which is synonymous with poverty, authoritarianism, and religious intolerance, but all nations, even Muslim nations, desire the wealth of the United States and Europe. Thus, this clash between the American Way and the European Way is about the future direction over the best development model for the world.

With American politics engulfed in recent years by a free-wheeling, free market, Texas-style economic fundamentalism that has led to increases in inequality and economic insecurity for many Americans, Europe has emerged more and more as what British author Will Hutton has called an international countervailing force -- a mainstay of “social capitalism,” that has tried to harness capitalism's extraordinary ability to create wealth so that it better supports families and workers, and creates a more broadly shared prosperity and economic security.

In addition, while America remains locked into a foreign policy determined by the oil chieftains in the White House and their increasingly desperate bids to acquire oil, Europe has taken the lead in trying to figure out how mass societies can deal with global climate change, develop alternative energies and reduce their ecological footprint. Europe also has introduced a new type of leadership for a global superpower, one based less on militaristic bluster and more on economic networks and multilateral institutions that foster development for poorer countries and security for the world.

When you bundle all this together, what it adds up to are two distinct versions of advanced political economies, which in turn are creating two diverging types of post-industrial mass societies. While it’s possible to stress what Europe and America have in common, in other ways what the world is witnessing is akin to two separately evolving lines of hominids which, while they appear at the moment to look similar, upon closer inspection have branched off into different habits, behaviors, colorations, reactions, and social organization, and are leaving tracks that are strongly diverging. It behooves us to approach this divergence a bit anthropologically, just as the Leakey’s approached their endeavors in Olduvai Gorge, so that we can better understand not only the present circumstances but our future trajectory.

The American Way versus the European Way

By many estimates the United States, despite being the world's lone remaining superpower, is more unequal than at any time since the Great Depression. Indeed, it's the most unequal society in the advanced democratic world today, with that inequality having glaring racial/ethnic, age, and gender dimensions. The poverty rate has increased to 37 million people (13 percent of the population)[1], child poverty is nearly 22 percent and elderly poverty nearly 25 percent, the highest by far in the Western world with the exceptions of Russia and Mexico.[2] Despite being the richest individual nation on the planet, the U.S. suffers from higher rates of poverty, homelessness, infant mortality, lower life expectancy, homicide, and HIV infection than other advanced democracies. It spends more per student on K-12 education than almost all other modern democracies, yet its students perform near the bottom on international tests. American analyst Ted Halstead has written, “Our performance on many social indicators is so poor, that an outsider looking at these numbers alone might conclude that we were a developing nation.”

European nations, on the other hand, score at the top on all these social and health indicators, and it’s no secret why: even with recent cutbacks, Europeans still enjoy universal health care for all, generous retirement pensions, an average of five weeks paid vacation, more holidays, paid sick leave, paid parental leave, affordable childcare, low-cost higher education, and a shorter work week with comparable wages for their workers. Social spending in Europe runs some 50 percent above that in the United States. European health and safety laws, based on the “precautionary principle,” are geared more toward helping workers and communities instead of protecting the bottom line of corporations; its environmental laws aim to preserve air and water instead of defining the “acceptable levels” of corporate transgression, like the Bush Administration’s Kafkaesque episode over allowable arsenic levels in public drinking water.

The typical knock against Europe has been that these levels of support for workers, families, communities and the environment have an unfortunate downside: they allegedly have made the European economies "sclerotic," likened to a sick old man. However, this has turned out to be an unsubstantiated stereotype, in reality the European economies have flourished. Between 2000 and 2005, when Europe supposedly was going downhill, it turns out the 15 original nations of the E.U. saw per capita economic growth rates equal to the United States (surpassing the U.S. in late 2006), added jobs at a faster rate,[3] had a much lower budget deficit, and now Europe is posting higher productivity growth than America[4] and a $3 billion trade surplus. In late 2007, the E.U. overtook the U.S. as China's largest trading partner, and in recent years it has been an investment magnet with stock market returns outperforming those in the U.S.[5] The United States, meanwhile, teeters on the edge of recession, struggling with declining productivity growth, a sagging housing market, a plummeting dollar and a staggering trade deficit that has leading economists worried.

With only 7 percent of the population, the European Union engine produces nearly 30% of the world’s economy, a gargantuan-sized commercial crossroads of approximately $15.2 trillion GDP, the largest economy in the world. If we add in the affiliated nations of Norway, Switzerland and Turkey, that brings the “E.U. Plus” to over $16 trillion, a third of the world’s economy.[6] The United States has a smaller economy, $13.9 trillion GDP, or 27 percent of the world, Japan is smaller still with 9 percent of the world’s economy, and despite all the hype, China is still an economic dwarf, accounting for less than 6 percent of the world’s economy. Europe’s economy hardly sounds like one that is “sclerotic” or a “sick old man.”[7]

Europeans have harnessed their economic engine to create wealth that is broadly distributed. Properly understood, Europe's economy and social system are two halves of a well-designed "social capitalism" -- an ingenious framework in which the economy finances the social system to support families and employees in an age of globalized capitalism that threatens to turn us all into internationally disposable workers. In that sense, Europe is more of a "workfare state" than a welfare state, as it has been derided in America. Even the continent's conservative political leaders agree that this is the best way. That is the European consensus, and it fundamentally differs from the American consensus.

This divergence between the American and European consensus is not a mere coincidence. It is a direct result of basic differences in key political, economic and media/communication institutions and infrastructure that have been quietly incubating and developing in the post-World War II period. Taken together these differences in "fulcrum institutions" -- the crucial institutions on which everything else pivots -- are the keys to understanding the striking divergence between the European way and the American way.

Representative democracy, Version 2.0

Fulcrum #1: Political institutions. Any visitor to the German Bundestag during parliamentary proceedings can see there are several aisles and five to six sections, in each one sitting a different political party. But when you visit the chamber of the U.S. House of Representatives, it is plain to see that there are two sides in that chamber, a left and a right -- Democrats on one side, Republicans on the other -- with an aisle, a dividing line, down the middle. The American people, with its vast array of ethnicities, religions, languages, geographic regions, political philosophies, Web sites, jazzy urban centers and climate zones, is dazzlingly diverse, but with only two electoral choices, the free marketplace apparently has spread everywhere except to America’s politics.

The U.S. House of Representatives, called The People’s House, unfortunately doesn’t look very much like “the people.” Those filling the chairs are 83 percent white and 84 percent male in a country that is 70 percent white and majority female. There are also a lot of lawyers and businessmen filling the seats, about three-fourths of the House membership, and a plurality of millionaires.[8] The United States Senate is even worse in that regard, of 100 Senators there are only six Hispanics, blacks or Asian Americans, 16 women, and even greater income disparities between the Senators and their voters. A famous 19th-century aphorism said, “It is harder for a poor man to enter the United States Senate than for a rich man to enter Heaven,” and things hardly seem different today.

But in the Bundestag there are six political parties represented today, a broad spectrum of public opinion occupying the chairs of the national legislature. In addition, 32% of Germany's national representatives are women, including the first ever female head of government, Chancellor Angela Merkel. There even have been a few 20-somethings elected to the parliament in Germany, as well as other European governments, but nothing like that ever occurs in the U.S. The average age of representatives in Germany’s Bundestag is 49 years old, compared to 57 in the U.S.[9]

It’s pretty hard for a nation, especially one as diverse as America, to reach a consensus on the pressing issues of our times when so much of the nation is not seated at the table of political power. The comprehensive social supports for families and workers available in European democracies, as well as the proactive policies enacted to tackle global climate change, hardly even receive a debate in the U.S. Congress. In the run-up to the Iraq invasion in early 2003, there was no anti-war party or even one casting a discerning eye on the manipulated evidence put forward by the Bush administration. Without a multiparty democracy where all significant points of view are represented, political debate in the U.S. has become stunted and constrained along increasingly narrow lines in which the best interests of the American people are not well-represented.

So the presence of a multiparty democracy is crucial. Why, then, does Europe enjoy multiparty democracy while America does not? The answer is simple: Europe uses more modern political institutions than the U.S., including proportional representation electoral systems, public financing of campaigns, free media time for candidates and parties, and robust public broadcasting. The United States has none of these, relying instead on political institutions that for the most part are still rooted in their 18^th century origins.

For example, the U.S. continues to be one of the last remaining advanced democracies to use a geographic-based electoral system which elects representatives one district seat at a time. In the modern era, this "winner-take-all" system, as it is called, has produced a stark landscape of legislative districts that are little more than one-party fiefdoms. Typically three-fourths of U.S. House races are won by lopsided landslide margins, and over 90 percent by noncompetitive 10 point margins. State legislatures are even worse. The winner-take-all system turns whole regions and even entire states into one-party fiefdoms where one side wins and all other points of view go unrepresented -- that's why it's called "winner-take-all." The fact is, most American voters don't even need to show up on election day, they have been rendered superfluous, and it's not due to partisan redistricting or campaign finance inequities, the usual reasons cited. New research shows that in most states partisan residential patterns are even more influential in deciding election outcomes. Liberals and conservatives are living in their own demographic clusters, i.e. liberals dominating in cities and conservatives in rural areas and many suburbs, and most districts are branded either Republican red or Democratic blue before the partisan line drawers sit down at their computers and draw their squiggly lines. There is little that independent redistricting commissions can do to change this, due to the partisan demographics and regional balkanization. It’s a byproduct of where people live, demography has become destiny.

Given America’s winner-take-all politics, multiparty democracy is impossible, and that has additional repercussions. It is hardly surprising that voter turnout in the U.S. is one of the lowest in the world among established democracies, since for the tens of millions of orphaned voters living in balkanized regions and lopsided districts, there’s literally nothing to vote for. Only 41 percent of eligible adults voted in the 2006 congressional elections, and barely a majority in the 2000 presidential election that elected George W. Bush.[10] Currently voter turnout in the United States is 139^th in the world, trailing Uganda and Morocco in the world’s rankings.[11]

But it's not just elections to the U.S. Congress that are hurting American democracy. U.S. presidential elections suffer from similar problems as the House and Senate -- a geographic based system with a stark lack of competition in nearly all states, as well as regional balkanization. As we saw in 2000 and 2004, this has produced a presidential election decided by small swathes of undecided swing voters in a handful of battleground states, notoriously led by Florida and Ohio. The vast majority of voters lives in locked-up states and experiences the presidential election as spectators watching a football game from the 142^nd row bleachers. What is supposed to be the premier “national” election is anything but. In reality, whichever candidate can fool a small minority of swing voters in just a handful of swing states with bumper sticker slogans like "compassionate conservative" or "New Democrat" the last week of the campaign wins the presidency, a process New York Times critic Frank Rich has accurately called "survival of the fakest."[12]

Differential treatment based on where one lives is a recurring theme in America’s 18^thcentury political system. Both the Senate and Electoral College are structured to give low-population, predominantly rural states more representation per capita than higher population states. Political scientists Francis Lee and Bruce Oppenheimer have shown that giving two Senators to each state, regardless of population, has had the effect of disproportionately favoring the low-population states when it comes to representation, policy, federal spending, even leadership positions in the Senate.[13] And because these states tend to be the most conservative in the country that representation quota has over-represented the Republican Party in the Senate in most elections since 1958.[14] This "representation subsidy" for low population, conservative states goes a long way toward explaining why America has fallen behind Europe in so many categories. It's like having a foot race where one side starts 20 yards ahead of the other. In America’s winner-take-all system, where one side wins and all other sides lose with little attempt at achieving consensus, conservative politics has been able to win an undeserved and disproportionate share of power, and lead America in directions that are unsupported by a majority of Americans.

In Europe, on the other hand, proportional representation electoral systems have produced more electoral competition, higher participation rates and more responsive governments. Political parties from across the political spectrum are able to compete for voters’ sympathies and to win their proportionate share of seats in the legislatures. Under PR, as it is sometimes called, a political party receiving 10% of the popular vote wins 10% of the legislative seats, instead of nothing; and another political party winning 60% of the vote wins 60% of the seats, instead of everything.[15] Representatives are elected by multi-seat districts instead of one-seat districts, where conservatives can win seats in the liberal/progressive areas and liberals/progressives can win representation in conservative areas, drastically reducing regional balkanization. Minor parties and independent candidates can win their fair share of representation too. They function as the "laboratories for new ideas," and their participation allows a dynamic conversation between the dominant mainstream parties and the junior parties, between the center and the flanks of the political spectrum. More voters actually have something to vote for, and it is no surprise that Europe’s multiparty democracies lead the world in voter turnout.[16] A much fuller marketplace of political choices in turn have fostered more spirited debate of major issues and increased voter engagement to a degree that has been impossible in the United States, with its two-party duopoly and regional balkanization.

Besides the widespread use of proportional representation, European democracies foster multiparty democracy in other ways. In the 18^th century, Thomas Jefferson wrote, “Whenever the people are well-informed, they can be trusted with their own government,”[17] and things are hardly different today. Three types of communication infrastructure are necessary in the modern age to foster a vigorous democracy: public financing of campaigns, free media time for candidates, and a robust public broadcasting sector that acts as a counterweight to the profit-driven corporate media. Of alarming note, the United States has none of these to speak of, Europe has a cornucopia of all three.

Europe gives free air time to parties and candidates and awards publicly funded campaign financing to all political parties that achieve a minimum threshold of the vote, typically 1% or so. Giving public money to a party, especially one with so few votes, is alien to the American way of thinking. But Europe endeavors to encourage political debate and discussion of ideas as part of its consensus-seeking process, while in the U.S. the Democrats and Republicans have a duopoly that they wish to preserve. Public financing helps open up the playing field by providing all candidates and parties with sufficient resources to communicate with voters, and this in turn foments real campaign debate, giving voters enough information to make a good decision in the voter’s booth.

Fulcrum #2: Media/communication institutions. The various media institutions in Europe also differ substantially from those in the United States, with dramatic consequences. In the absence of public financing or free air time, running for higher office in the U.S. is extremely expensive and the corporate media has become an arbiter of candidates’ viability. But in Europe, more politically diverse media and communication outlets have fostered a pluralism of public opinion, debate, and analysis that has implanted itself not only in campaigns and in the legislatures, but also in the general news reportage between elections. Europe enjoys the benefits of more robust public television and radio networks, as well as numerous daily newspapers with editorial slants from the right to the left to the center. Many newspapers are subsidized by the government or receive special postal rates, while the public broadcasting is much more generously funded to the tune of $50-90 per capita in Sweden, Germany and Britain. In the U.S., public broadcasting receives about three dollars per capita, a pathetic pittance in comparison.[18]

Nearly as important as the level of funding is the mechanism of public funding. In the U.S., public broadcasting has been funded by budget allocations from a hostile rightwing Congress and donations from corporations. Its survival -- and therefore its journalistic independence -- has been in doubt. But public broadcasting in Europe usually is funded by mandatory public subscription fees where all households are required to pay a monthly amount of approximately $15, about $170 per year, much like subscribing to cable TV in the United States (but a lot cheaper). This gives public broadcasting its own funding base that is greatly independent of the government's mood swings and attention deficits, as well as of the bottom line considerations of the profit-driven corporate media.

When it comes to penetration of the internet and high-speed broadband availability, Europe as well as Japan is way ahead of the U.S. As recent as 2001 America led the world, but now it is ranked 21^st in digital opportunity, just behind formerly communist Estonia.[19] Europe’s high speed connections are less expensive and lightning fast compared to those of the U.S.,[20] which consequently also is lagging in high speed internet applications, such as streaming video and Internet TV.[21] In an Information Age, where an informed citizenry is enhanced by its access to the democratizing aspects of the internet, Europe is leading the way while the U.S. has fallen behind.

Taken together, these media and communications institutions, combined with public financing, free air time for campaigns and proportional voting, contribute to a greater degree of what political scientist Henry Milner has called “civic literacy” -- more citizens who are informed and conversant in the issues of the day.[22] Various studies have demonstrated that the peoples of Europe are the most educated and informed in the world, not only about their own domestic politics but also about international affairs. Americans, on the other hand, consistently perform near the bottom of these measurements. America’s media deficit was never more apparent than during the months-long build up to the 2003 Iraq invasion. New York Times columnist Paul Krugman commented that “[Europeans and Americans] have different views partly because we see different news. At least compared with their foreign counterparts, the ‘liberal’ U.S. media are strikingly conservative -- and in this case hawkish.”[23]

So Europe's multiparty democracies clearly outshine America's two party duopoly when it comes to representation, more robust political discourse and greater media pluralism leading to a better informed populace, but that’s not all. Research by political scientists Arend Lijphart, John Huber, G. Bingham Powell and others have demonstrated that Europe’s multiparty democracies produce legislative policy that is more responsive to the desires of their populaces than winner-take-all systems. Lijphart reviewed performances of 36 countries, classifying them into “majoritarian” and “consensus” democracies, proxies for winner-take-all and proportional democracies respectively. He concluded “the consensual democracies clearly outperform the majoritarian democracies with regard to the quality of the democracy and democratic representation;” they also are more likely to have enacted comprehensive social programs, have a better record on the environment, on macroeconomic management, on controlling violence, put fewer people in prison, are less likely to use the death penalty, are more generous with their assistance to developing nations, and more likely to elect more women.[24]

Fulcrum #3: Economic institutions. With a more democratic and representative politics, it’s no surprise that Europe’s economic engine would be better harnessed to produce wealth that is broadly shared. Political democracy has translated more directly into economic democracy, and that is reflected in people’s attitudes, even that of Europe’s business class,[25] and has been injected into the associated fulcrum economic institutions. The most notable example is German Mitbestimmung (worker codetermination), which is the most democratic corporate structure ever devised. This framework includes supervisory boards (Aufsichtsrat) where elected worker representatives sit side-by-side as equal decision makers with stockholder representatives on corporate boards of directors. Works councils (Betriebsrat) in every workplace give workers a great deal of input at the shop floor level. Codetermination obliges managers and executives to confer extensively with employees and unions about health and safety standards, wages, bonuses, introduction of new technology, layoffs, and generally gives workers a say in their workplace far beyond what any workers in the U.S. can imagine. These institutions reflect German communitarian values much the way that highly paid U.S. corporate executives and heavily upside-down pyramid salary structures reflect the American value of individualism. Sweden and most other European nations, even Britain, have adopted some degree of co-determination, while the U.S. has nothing comparable.

These three fulcrum institutions -- political, media/communication and economic -- taken together, work coherently to form the basis of a political economy that distinguishes the European Way from the American Way. Without a thorough grounding in the understanding of these basic institutions, you cannot possibly comprehend the current divergences between Europe and America, nor their future direction. Basically, it comes down to democracy, both political and economic, and whether the overall system is geared towards equality and pluralism in all facets, or whether the democracy is stunted. It is easy to see how Russia's democracy has regressed in recent years under Putin’s authoritarian tendencies, but it has been more difficult to recognize how American democracy is backward and unfit for the challenges of the 21^st century.

Simply put, America has the wrong fulcrum institutions. Ironically, the land of “We, the People” still does not trust the people all that much, and its aging fulcrum institutions elect governments that fail to produce policy supported by a majority of Americans. Judging by the positions of the Democratic candidates for president and the timidity of the Democratic-controlled Congress, this seems unlikely to change much, even in a Democratic administration. Consequently, the advances of the 21^st century in political, economic, media and social organization will continue to take place in Europe, not America. If we are to survive the 21^st century, Europe must to step up to the task of global leadership, and part of that process must involve spotlighting its fulcrum institutions -- political, media and economic -- as the basis for a new “social capitalist” development model that offers much hope to the world.

Sidebar:

The differences in the fulcrum institutions of the European way and the American way can be summarized as follows:

	U.S.	E.U./Europe
Political	winner-take-all electoral systems	proportional representation electoral systems
	privately financed elections	publicly financed elections
	corporate media limiting debate	robust public TV and radio fostering debate
	two party system	multiparty system
	poll-driven, sound bite political campaigns	more debate and discussion of issues
	restricted, voter-initiated registration	universal voter registration
	voting in the middle of busy work day	voting on a holiday or weekend
	decentralized election administration	national election commissions & standards
	U.S. Senate, Electoral College give advantage to low-population states, undermines majoritarianism	more majoritarian, less advantage for low-population states
	mistrust of democracy	more trusting in democracy–Children’s Parliaments deliberative democracy, Question Time
	unilateralism	multilateralism
	foreign policy based on realpolitik and military might	foreign policy more humanitarian and network-based
Media	corporate media gatekeepers	robust public broadcasting (radio & TV)
	loss of political ideas	political pluralism – promotion of ideas
	media monopolies	subsidized, diverse daily newspapers
	poorly informed citizenry	better-informed citizenry
	low level of "civic literacy"	high level of "civic literacy"
	fewer people read newspapers	more people read newspapers
Economic	individualist values	communitarian values
	hierarchical structures	worker codetermination on corporate boards of directors and works councils
	stockholder rights	balance of stockholder & stakeholder rights
	adversarial between labor and management	labor and management confer more extensively
	corporate-driven free trade pacts	national referendums on joining EU & Euro

Notes:

[1] Christopher Swann, “More Americans Lack Cover for Ill-Health,” Financial Times, August 30, 2005. Also see David Leonhardt, “U.S. Poverty Rate Rose in 2004, Even as Economy Grew,” New York Times/International Herald Tribune, September 1, 2005.

[2] By way of comparison, here are other child poverty rates: Sweden (4.2%), Germany and Austria (10.2%), UK (15.4%), Italy (16.6%) and Mexico (27.7%). See “The State of the World’s Children, 2006,”a report by UNICEF, 2006, www.unicef.org/sowc06/pdfs/figure2_4_2005.pdf and www.unicef.org/sowc06 for the full report. Also see the State of Working America 2004/2005, Economic Policy Institute. The International Comparisons chapter compares the economic performance of the United States to the 19 other rich, industrialized countries that also belong to the Organization for Economic Cooperation and Development (OECD). See a summary at www.epinet.org/books/swa2004/news/swafacts_international.pdf

[3] Dan O’Brien and Aurore Wanlin, “Reasons to be cheerful about Europe,” Financial Times, November 24, 2006. The Gross Domestic Product per capita -- considered by economists to be the most important indicator of overall economic well-being -- grew by 20 percent in the E.U.-15 and 21 percent in the U.S., a statistically insignificant difference. Also see Jack Ewing, “Europe’s Locomotive Is Back on Track,” BusinessWeek.com, www.businessweek.com/globalbiz/content/oct2006/gb20061010_457604.htm?campaign_id=eu_Oct11&link_position=link34, October 10, 2006; and John Schmitt, “Whatever Happened to the American Jobs Machine?”, Center for Economic and Policy Research, Issue Brief, October 2006.

[4] "EU overtakes US in productivity growth," EurActiv.com, November 6, 2007, www.euractiv.com/en/innovation/eu-overtakes-us-productivity-growth/article-168129. A competitiveness report from the European Commission found that for the first time since 2001, the EU had outstripped the US in productivity growth. EU worker productivity grew at 1.5% in 2006, a sizable increase over the previous year, while in the US it had declined to 1.4%, the two economies trending in opposite directions.

[5] Tim Hepher and Emmanuel Jarry, “Sarkozy tackles Hu on yuan and human rights,” Reuters, November 26, 2007.

[6] All Gross Domestic Product figures and some population figures from the International Monetary Fund’s World Economic and Financial Surveys, World Economic Outlook Database, September 2006 Edition, www.imf.org/external/pubs/ft/weo/2006/02/data/index.aspx.

[7] According to the World Economic Forum’s measure of national economic competitiveness for 2006-2007, European nations took the top four spots, seven out of the top ten spots and 12 out of the top 20, with the U.S. ranked sixth.

[8] See Mildred Amer, "Membership of the 110th Congress: A Profile," CRS Report for Congress, Order Code RS22555, December 15, 2006, www.opencrs.com/rpts/RS22555_20061215.pdf.

[9] For the German figure, see “German Parliament Sports Young Face,” Deutsche Welle, Sept. 24, 2002, www.dw-world.de/english/0,3367,1430_A_642760_1_A,00.html. For the U.S. figure, see Associated Press, "A Numeric Profile of the New Congress," Fox News, January 04, 2007, www.foxnews.com/story/0,2933,241441,00.html. Forty two senators are 65 or over; while the average American is 37, no Senators are in their thirties. Intelligence Report, Parade,November 25, 2007, p. 12.

[10] Nonprofit Voter Engagement Network, America Goes to the Polls: A Report on Voter Turnout in the 2006 Election, p. 6-9, www.nonprofitvote.org/wp-content/uploads/AGttP.pdf.

[11] See statistics published by the Institute for Democracy and Electoral Assistance (IDEA) at http://idea.int/vt/survey/voter_turnout_pop2.cfm.

[12] Frank Rich, “Survival of the Fakest,” New York Times, August 26, 2000. The ever-witty Rich, comparing the dreary presidential conventions to the TV season finale of “Survivor,” wrote: “Through a weird cultural reversal, America is now a place where there’s more spontaneity and ‘‘reality’’ in a prime-time network entertainment series than there is in the TV spectacles staged by our political parties over supposedly momentous issues of public policy.” Observing that neither of the party’s nominating conventions on their best nights drew close to half the audience of “Survivor,” Rich further commented that “the audience that cast its vote by Nielsen isn’t stupid. It does prize authenticity over canned showmanship… As that minority of Americans paying attention knows, the choice this year is between two distinctive brands of inauthenticity.”

[13] Frances E. Lee and Bruce I. Oppenheimer, Sizing Up the Senate (Chicago: University of Chicago Press, 1999), 4-5.

[14] Throughout the 1990s and into the 2000s, the Democrats and a Vermont independent represented a total of 240 million adult Americans (if one counts the total adult population of a state once for each senator representing that state), and Republicans represented a total of 190 million adults -- yet the Republicans had the majority. In 2004, 52 percent of the two party vote was cast for Democratic senatorial candidates, yet Republicans elected 19 of the 34 contested seats (56 percent). Richard Winger, Ballot Access News, Vol. 22 No. 9, January 1, 2007, p. 4.; Matthew Shugart, “Filibuster Protects the Majority -- of Voters,” San Diego Union Tribune, May 18, 2005; Hendrik Hertzberg, “Nuke ’Em,” New Yorker, March 14, 2005.

[15] In PR systems, the percentage of vote it takes to win one seat is dependent on the “victory threshold” of representation, which is derived by making all contested seats in a multiseat district equal to the same number of votes. If 10 seats are being elected at once from a multiseat district, each seat will be worth 10 percent of the vote in that ten-seat district. Winning 30 percent of the vote will gain three out of 10 seats, 60 percent of the vote will gain six out of 10 seats, etc. By adjusting the victory threshold it is possible to fine-tune your democracy and decide how inclusive or exclusive you want it to be. See the website of FairVote (www.fairvote.org) for additional resources about proportional representation.

[16] Italy tops the list with 93% participation, Belgium, Austria and the Netherlands at 85%, Sweden, Denmark and the Czech Republic at 83% and Germany at 81%.

[17] Thomas Jefferson to Richard Price, 1789, from The Writings of Thomas Jefferson, Memorial Edition (Lipscomb and Bergh, editors) Washington, D.C., 1903-04, Volume 7, p. 253.

[18] See "Review of Public Service Broadcasting around the world," a report by McKinsey & Company, London, September 2004, http://www.ofcom.org.uk/consult/condocs/psb2/psb2/psbwp/wp3mck.pdf

[19] S. Derek Turner, "Broadband Reality Check II: The Truth Behind America’s Digital Decline," Free Press, August 2006, p. 8, www.freepress.net/docs/bbrc2-final.pdf; John Borland, “Estonia Sets Shining Wi-Fi Example,” CNet News.com, November 1, 2005, http://news.com.com/Estonia+sets+shining+Wi-Fi+example/2010-7351_3-5924673.html?tag=html.alert.

[20] Blaine Harden, "Japan's Warp-Speed Ride to Internet Future," Washington Post, August 29, 2007; p. A01, www.washingtonpost.com/wp-dyn/content/article/2007/08/28/AR2007082801990_pf.html; Esme Vos, "100 Mbps for 30 Euros in Paris," Muniwireless.com, August 31, 2007, www.muniwireless.com/article/articleview/6367/1/2. France, Japan and other nations are offering broadband access with typical speeds of 100 megabytes per second, whereas in the U.S. typical speeds are 2.5-3.0 Mbps.

[21] Paul Krugman, "The French Connections," New York Times, July 23, 2007

[22] Henry Milner, Civic Literacy: How Informed Citizens Make Democracy Work (University Press of New England: Hanover and London, 2002).

[23] Paul Krugman, “Behind the Great Divide,” New York Times, Feb. 18, 2003. Krugman was trying to understand the incredulous fact that polls were showing a majority of Americans believing that some or all of the Sept. 11 hijackers were Iraqi, and that Saddam Hussein was involved in Sept. 11, a claim even the Bush administration never had made. Such a startling level of ignorance, Krugman optimistically surmised, was because the American media, particularly TV, had rendered them ill-informed.

[24] Arend Lijphart, Patterns of Democracy: Government Forms and Performance in 36 Countries (Yale University Press: New Haven and London, 1999), p. 275, 280-2, 301-2.

[25] While both the United States and the European Union are capitalist economies, there are important and diverging differences. A fascinating book from 1993, Seven Cultures of Capitalism, was written by two business consultants who had distributed questionnaires to some 15,000 business managers from around the world. They used the results of these questionnaires to gauge how values, habits and cultural styles affected the pursuit of economic success. Respondents in each of the “seven cultures” studied -- the United States, Britain, France, Germany, Japan, Sweden and the Netherlands -- reacted in startlingly different ways. Not surprisingly, the authors found profound differences between the United States and Europe, with Britain straddling a line between the two. European business managers were more disposed to communitarian values and teamwork, while American managers were hyper-individualists, producing businesses that were hierarchical and narrowly focused on quarterly profit sheets. These postures naturally spilled over into social attitudes. For instance, the American-British brand of capitalism regarded poverty as a sign of personal failure, idleness and disgrace; but Germany, Austria, Scandinavia and Japan regarded poverty as the economic consequences of workers finding themselves mired in declining industries.

NPR Interview with Mark Schmitt at Bloggers' Convention

Communications — Sat, 04 Aug 2007 19:00:00 -0400

Senior Fellow Mark Schmitt talks with National Public Radio about his blogging on TPMCafe.com, while attending the YearlyKos Convention in Chicago:

LYDEN: And you -- looking to have an impact here on the campaign?

Mr. SCHMITT: I'm not looking to have too much of an impact on the campaign. I'm more interested in how different issues are playing out in the campaign. So I, you know, if I'll write about tax policy, I'll comment on how I think some of the different candidates are handling an issue like that or an issue like political reform, CAFE finance reform, which I was on a panel about today, rather than trying to have an impact, you know, in terms of supporting one candidate or the other.

LYDEN: Well, let me ask you. This is billed as the blogging convention that is the highest profile so far for political candidates. Do you feel like you're satisfied with getting access to them, with getting them to come and deal with you as the -- dare I say this -- media of the future?

Mr. SCHMITT: One could hardly be dissatisfied...

For the complete story, visit the NPR web site.

Clintons' Ties to India Could Imperil Your Job

Cecille Isidro — Tue, 19 Jun 2007 08:31:00 -0400

If a leading American presidential candidate -- and her husband, an ex-president -- seem to have unnaturally close connections to foreign companies interested in draining away American jobs, should that be of interest to Americans?

Some, including campaign rival Barack Obama, say yes, this should be a big story. But the mainstream media seem to say no. Why this media lack of interest?

For the past six years -- since Bill Clinton left the White House, since Hillary Clinton entered the U.S. Senate -- both Clintons have cultivated close ties with Indian companies. Bill has invested as much as $50,000 in an India-based electronic transactions firm while accepting $300,000 in speaking fees from Cisco Systems, which, among other enterprises, helps American firms outsource jobs to India.

In addition, Bill has established a close relationship with InfoUSA, an Omaha-based corporation controlled by one Vinod Gupta. A lawsuit by InfoUSA shareholders, irate at Gupta’s free-spending ways, alleges the company has transferred some $3 million to the ex-president during the past four years.

For her part, Hillary has received hundreds of thousands of dollars from Indian-American campaign contributors. Sant Singh Chatwal, co-chairman of Indian Americans for Hillary 2008, has pledged to raise $5 million. But Chatwal reportedly has a checkered past. In 2001, the New York Daily News said, he was charged in India with defrauding a bank of $9 million. The case eventually was settled, with Chatwal repaying the loans in question. In a 1996 case, also reported by the Daily News, Chatwal was involved in bad loans that reportedly cost The First New York Bank for Business some $25 million.

Indeed, so tight are the Clintons with the Indian community worldwide that last year she joked -- as she accepted $50,000 at a senatorial fundraiser held in the Maryland home of prominent dentist Rajwant Singh -- "I can certainly run for the Senate seat in Punjab and win easily."

The reader might wonder: How did Jim Pinkerton get to be so expert in the Clintons’ financial dealings? The answer: I got it from a research document put together by the Obama campaign.

Whatever the source of the information, it would seem that the Clintons’ financial dealings -- and the policies that flow from those dealings -- should be of great interest to Americans, confronted as they are by the accelerating phenomenon of job outsourcing.

Dogmatic free-traders think such outsourcing is great, but others aren’t so convinced. Alan Blinder, a free-trade proponent while serving as an economic adviser in the Clinton White House, has since reconsidered his stance on outsourcing. Last year Blinder published an article in Foreign Affairs in which he projected that as many as 40 million American jobs could be lost to outsourcing in coming decades.

What does Hillary think of this threat to American well-being? According to the Obama campaign, citing a 2005 Asia Times article, she said, "Outsourcing will continue ... We are not in favor of putting up fences."

Surely middle-class Americans should know about these matters: In the most literal sense, their jobs might depend on it. But the mainstream media don’t seem to agree -- maybe because reporters want Hillary to win, no matter what, or maybe because they just can’t imagine being against "free trade," no matter what.

So, instead of covering the India campaign-finance-outsourcing issue, reporters have chosen instead to attack Obama for some sort of dirty trick -- the "dirty trick" of assembling a fact-laden dossier on the Clintons. The New York Times sniped that Obama’s "political purity is becoming more difficult for him to maintain." And The Washington Post fretted about his "rough and tough tactics."

No doubt Obama will back off now, knowing as he does that his career, in 2008 and beyond, depends on media goodwill. And so Hillary can cruise to the Democratic nomination, and perhaps the presidency. In which case, American jobs will continue to cruise to India, sped along by campaign and corporate cash.