Video: Lessig on Political Corruption in America
Why Is This Important for Value Investors?
Well lets look at an excerpt from Jeremey Grantham of GMO’s latest letter…
“Five Supreme Court justices today announced that not only are corporations people and that their money is free speech – this is old hat and a very ugly hat at that – but now, there should be no limit to the money they spend to infl uence political outcomes. This would be one thing if corporations really were “democratic associations” of humans that the Founding Fathers may have wanted to protect. They are, instead, small oligarchies of top management. Thus, the top management of major oil and coal companies can decide what political outcomes they want to promote,say, unlimited production of carbon dioxide (none of their CEOs apparently has grandchildren!), utterly without any approval of their decisions by the millions of actual owners. The fi nancial power of corporations was already in danger of overwhelming the democratic process in Congress and this makes the damage potentially unlimited and puts the Court’s seal of approval on it. So let’s do it in style and have a name change. The U.C.A. has a familiar look: The United Corporations of America!”
Introduction (Via Open Culture)
Public confidence in the U.S. House and Senate is at an all-time low, and, after last week’s Supreme Court decision, it’s bound to sink even lower. On January 19th (the day before the decision), Harvard law professor Lawrence Lessig returned to Stanford and highlighted the degree to which “institutional corruption” — in the form of lobbyists and corporate influence — pervades Congress, dictates legislation, and brings large sums of money to campaigns and, yes, even representatives’ personal bank accounts. (Roughly 50% of U.S. Senators become lobbyists, working for industries they once assisted politically, and earn substantial incomes.) The talk, accompanied by a rapid fire PowerPoint presentation, runs a solid hour and details various instances in which lobbyists have shaped unfathomably bad legislation. Happily, the talk also ends with Lessig outlining possible solutions. Policy changes can offer some answers. But, a lot of it comes down to this: getting the passive privileged to rein in a corrupted elite.
The Supreme Court’s ruling in Citizens United v. FEC gives corporations free rein to pour unprecedented amounts of money into elections. From this day forward, when Congress acts, who can say it wasn’t because of the money? Watch Lawrence Lessig’s response to Citizens United, share his call to action with friends, and sign up for updates.