Lipstick on a Financial Collapse

Last week, I meant to bring up a column by Megan McArdle. I don’t often make someone else’s blog writing my point of departure, but this post got under my skin enough that I keep coming back to it mentally. McArdle argued that political barbs directed at the scandal that made the news last week regarding corruption in the Mineral Management Service within the Interior Department were functionally equivalent to the flap over Obama’s “lipstick on a pig” comment.

If I parse the entry carefully enough, McArdle seems to acknowledge that the first is “substantive” and the second not, but then seems to think that raising a political objection to the first is the same as the second: banal, business-as-usual, and unworthy of further discussion or reporting.

That’s an epic fail on the Sesame Street “one of these things is not like the other” exercise. That’s how we got into much of the mess we’re in right this very moment, on so many levels. This is the consequence of this sense that all government is equally and indifferently corrupt and non-functional, that none of what states do for good or ill turns on the competency or morality of any particular political leadership but is instead a generic and invariant result of the nature of bureaucratic states. That a report of corruption or administrative incompetence is like a report of the weather or the tides, an expected and everyday event with its own cycles.

This is another of the many things that observing Zimbabwean politics from the mid-1980s until now taught me. I’ve just written that social and political change below the surface of formal diplomatic events and agreements matters most. But Zimbabwe also taught me that the bad decisions of bad men and women can by themselves make all the difference in the world. Nothing was inevitable about Zimbabwe, and most of what it has become is squarely the responsibility of the top political and social elite that gained power over the 1980s. What happened was not “all states fail”. It was “some people failed, and dragged everyone else down to hell with them.”

Corruption is a pervasive political and economic reality across the world. It’s a basic part of the modern order, whether the place we’re thinking about is a small ex-industrial city in New England or a postcolonial African nation. But it has its tipping points where it slides from being an entropic force that we struggle constantly against to being a dark tidal wave that roars over our heads and drowns us all. Those lines are crossed by the wrong people at the wrong time doing things more poorly, more venally, more destructively than others. And perhaps more, those lines are crossed by the indulgent and indifferent attitude that says, “Oh, the public interest was sold out for some momentary cheap thrills in an administration endlessly indulgent of such behavior? Dog bites man, you know, shocked there is gambling going on here and all that.” Corruption becomes omnipresent, pervasive, irresistable when it is ok to say and believe that we all do it, that everyone does it, that it’s a non-issue, that it’s as unimportant as a bit of meaningless hot air over trivial words.

There are some dark waves threatening our collective heads today. If they come crashing down, it will be in no small measure because bad people made bad decisions with their own immediate political and personal interests at heart, while some onlookers serenaded them with sweet fiddle music all the while.

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14 Responses to Lipstick on a Financial Collapse

  1. janegalt says:

    I think we’re talking about two different things. Was the scandal important? Sure, though a little off my beat, so I didn’t cover it. But was John McCain responsible for it? No he wasn’t, and the attempt to claim he was is pure partisan bullshit from people who ought to know better, but find it convenient not to. You don’t have to accept government corruption to note that not every scandal reflects some failure of leadership on the part of someone tangentially connected to the agency.

  2. Timothy Burke says:

    Is John McCain responsible directly for it? No, though you could argue he’s gotten himself tangled up in some rather similar problems and scandals in the past.

    Is he taking any interest whatsoever in describing an administrative philosophy that will comprehensively break with the previous administration’s policies and conduct, which WERE responsible for this scandal? No, he’s not. It’s not partisan bullshit to say that McCain at present gives every indication that he will govern JUST AS the people responsible for the scandal have. His vice-presidential candidate has governed in exactly that way in her limited time as an executive, using loyalty and sycophancy as her primary standards for selection of administration officials. McCain is the leader of a party that has massive numbers of these kinds of scandals to its name to show for eight years in office. It is anything but routine, banal partisanship to demand that the burden is on him to speak concretely, specifically, and clearly how he will thoroughly break with those practices on every possible level. He needs to describe how he will govern, what kinds of consultative practices he will employ, what his standards for appointment to high office are, and how or if he intends to make thorough executive oversight a part of his expectations for appointees in his administration.

    Are you saying, in terms of your last point, that this specific scandal in no way reflects on the leadership of the Department of the Interior, and is in no way similar to other scandals among the Congressional Republicans or elsewhere in the Administration during the past eight years? If so, why do you think this scandal is specifically different? That is a quite specific claim that calls for specific evidence, not a generic wave-off that sometimes corruption isn’t the fault of the leadership. To me, this particular scandal very much looks like a lot of the indifference to oversight practices that the present Administration has practically made an official policy commitment.

  3. janegalt says:

    This is a scandal of the executive branch, not the legislative branch.

    Look, I hate John McCain with a passion, and am not voting for him. But while I understand that many Obama supporters seem to feel very keenly the truth of the proposition that every bad thing that ever happens anywhere in the Senator’s vicinity somehow illustrates a horrific underside of his character, this strikes me as just as desperate and delusional as the conviction that Obama is a secret Muslim, or harbors a secret desire to call Sarah Palin, and them, names.

    And while I’m happy enough if the “four more years” meme plays well in ads, it is not actually true. McCain is really very unlike Bush on domestic policy and in management style, and he’s an anti-corruption freak when it comes to institutions. (Sadly, he’s also pig-headed and sort of a wackaloon, which is how we ended up with Palin and the lobbyists.) Obama supporters have somehow convinced themselves that it must be true, because it’s such an awesome sound byte. But do I think this is in any way symptomatic of what a McCain administration would look like? No. And earnest protestations that this all matters very, very much strike me as either foolish or dishonest.

    There are so many, many reasons to hate John McCain. We don’t need to go making up ones that aren’t true.

  4. Timothy Burke says:

    He’s an anti-corruption freak who somehow ended up deep in the savings & loan scandal, which was a warm-up for the present crisis. Oh, and he hangs out with lobbyists now on a regular basis. That’s just pig-headedness? Whatever, it amounts to the same thing.

    The point is, he represents a PARTY, a BIG GROUP of people who have had NEAR TOTAL political power for six years, prior to 2006. They could have made any policy they wanted. Which, by the way, could have included aggressive *legislative* oversight of the *executive* branch, just in case you hadn’t noticed that interrelationship. If he wants to head the executive branch, he owes the public a detailed breakdown of how he will run that branch in a way dramatically different from his predecessor and the rest of the party he now leads.

    But no! That’s the same political, partisan argument as “what is the referent of ‘lipstick on pig'”. Right.

  5. janegalt says:

    His involvement in the S&L scandal is dubious; even Democrats from the period admit that he was basically handed over the leadership to save face by making the corruption look bipartisan. But he also traces his anti-corruption record to that period. And as the daughter of a lobbyist, I need more than the mere fact that they are lobbyists to prove their evility. Lobbyists are usually very sharp experts on their topics.

    As for the oversight, surely the Democrats could also have done this in the last two years, when the scandal was occurring? Isn’t Obama representing a party that did nothing? Doesn’t he have to answer for their lack of initiative?

  6. Josh says:

    As for the oversight, surely the Democrats could also have done this in the last two years, when the scandal was occurring? Isn???? Obama representing a party that did nothing? Doesn???? he have to answer for their lack of initiative?

    That’s a wonderful way of not answering the question.

  7. hestal says:

    Because our political system was corrupted by political parties beginning in the election of 1800, and because ever since the two parties, no matter their names, have alternated in power, and because they undertook to reverse the progress made by the preceding party in order to destroy their predecessors electability, and because both parties actually began to dance a symbiotic dance and wrote laws that enabled those in office, no matter if they were in the majority, to still make piles and piles of money, and because politicians accrete power and excrete corruption and public servants don’t, and because politicians therefore manipulated our election process so that incumbents are usually reelected, we find that, in the words of Andrew J. Bacevich, there is actually only one political party in America and it is the Incumbents Party, we find ourselves pitifully reduced to yelling at each other while we sink into the muck.

    So I say with a peaceful feeling of absolute certainty that both parties are to blame and those partisans who have been office the longest are the most to blame. So John McCain has been in office a long time and therefore bears much responsibility for what has happened. Any claims to the contrary only prove that he has been worthless, or in the words of my sainted grandmother, “not worth the powder it takes to blow him up.”

    Barack Obama has been in office for only a short time and therefore bears less responsibility, but he will not make any lasting, substantive changes, even if he tries, which, at this time, is still an open question.

    The system is under duress and controlled by almost any interest except the interest of the People. But all of this is not news, and should be obvious to the casual observer, let alone the learned one.

    In Federalist 1, Alexander Hamilton called our attention to this when he said that debate over the proposed Constitution would be based on interests and prejudices, or as he said, “??that intolerant spirit which has, at all times, characterized political parties.?? He went on to say more about parties, ??To judge from the conduct of the opposite parties, we shall be led to conclude that they will mutually hope to evince the justness of their opinions, and to increase the number of their converts by the loudness of their declamations and the bitterness of their invectives.?? Sounds familiar, doesn??t it?

    So every four years we poor fools in the electorate cannot help ourselves, and we succumb to the invective and bitterness because so much is at stake and because we have such dreams for ourselves, our families and for America. We rant and rave and curse and hurt until we finally purge ourselves as if we had consumed two bottles of magnesium citrate. And we return to our occupations and hope for the best.

  8. hestal says:

    And that is a Lesson of History.

  9. peter55 says:

    Having lived in Zimbabwe during the first half of the 1980s, I agree with your analysis that the present state of the country is due to the discretionary and cumulative decisions of individuals, and not something at all inevitable. The poor decisions set in early; for instance, the Cabinet decision (made in, I think, 1981 or 1982) to allow private abatoirs to operate in illegal competition with the Government-owned Cold Storage Comission, despite the CSC’s legal monopoly over meat processing, and despite the failure of the private abatoirs to meet health regulations, was not a manifestation of a belief in capitalism or in favour of deregulation, but a response to the fact that many Cabinet members, even then, had shareholdings in these private ventures.

    Where I disagree with you is in your implicit description of these policies as leading to “failure”. The over-riding policy aim of Robert Mugabe has always been the gaining and the retention of political power, even at the expense of the complete emiseration of the populace. Mugabe has, after all, an MSc in Economics from the LSE (a degree gained by correspondence after Independence — he flew to London to sit the exams during the 1985 election campaign), and he is no slouch intellectually. He knows full well the relationship between the money supply and inflation in a capitalist economy, and has used this knowledge to destroy the economy in order to retain his hold on power.

    Unlike in many African countries, Zimbabwe’s present position is not the result of incompetent policy-making and/or -execution, but of superb competence. Making people dependant on food-aid, and reducing the formal sector of the economy through inflation and the compulsory acquisition and re-allocation of assets, turns a capitalist economy with its anonymous transactions into an economy based on patronage — whether for food aid in the rural areas or for farm-ownership and for export & import permits among the elite. From the perspective of Mugabe and his circle, there has been no failure here.

  10. Western Dave says:

    Yeah, Hestal the Civil Service act didn’t do a damn thing. Oh wait.

  11. Timothy Burke says:

    I think that’s a good way to put it, Peter: superb competence at an essentially destructive, short-term objective.

  12. hestal says:

    You’ve got me Dave. I have no idea what you are talking about.

  13. nord says:


    I admire and actually support your goals around competence and corruption. Despite being a libertarian, there is something very nice about doing business in scandanavia and not being shaken down by the political powers that be (though outside of their home countries, swedes can bribe with the best of them … hmm how are those swedish jet fighters flying Mr. Zuma???). that being said, getting corruption out of the system IMHO is about increasing the punishments, both through judical and ex-judicial efforts(shaming would be ideal) without regards for political point-scoring.

    Unfortunately corruption is here and has to be fought, whether it embarasses Republicans or Democrats. While anti-corruption makes a good soundbite this election cycle with the netroots, I don’t believe any of them are committed to this as a philosophy or ideal – rather it is the path to power where their guy calls the shots. Charlie Rangel for Secretary of Treasury? Spitzer for Director of HHS? Or more seriously, Mayor Street’s brother for any position or the city of chester putting in resources for an empty soccer stadium, or democratic politicians setting up shell wholesaling companies for the casinos starting in Philadelphia?

    The interior department was bad – bad enough that the press will shame them into changes, charges, and punishments. Corruption in Philadelphia school district? Shrugged shoulders and no competitive political process to change that there – it takes a body to drop to get local corruption/competence issues in the news.

  14. Timothy Burke says:

    Well, where’s the Republican Mayor Nutter? E.g., I actually do think there are more Democrats (or Democrat-leaning independents) for whom corruption and competence are actually wedge issues that will push them one way or the other in an election than there are, at present, Republicans. Moreover, much of the mainstream media (and independent media, even overtly left-leaning) is very much willing to poke and prod at corruption on either side. How do you think we know about Rangel? No body really dropped there–somebody investigated. But it doesn’t make for much of an incentive to push in that way if you know for a rock-solid fact that there is zero chance of the other political faction taking up a similar house-cleaning of their own.

    But you’re right that this can’t come down to just whether members of a particular political faction have the right values, etcetera. It also has to come down to process and procedure, to a system that guards against the inevitable drift to corruption. It’s when a political leadership sets out to remove safeguards, stop oversight, abolish judicial review, and so on, that we should get very worried, far more so than when we see a media report about some individual case of venality. Well, guess what the last eight years have been all about? The systematic dismantling not just of specific systems of oversight and regulation, but also of the entire *concept* of oversight. And here we are again with that proposition with the bailout: to fix a system where people ran wild without any systematic checks or safeguards, we are being told that it is necessary to give someone else the option to run wild without any systematic checks or safeguards.

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