Three years ago, then-Senator Barack Obama proudly declared:
I have done more to take on lobbyists than any other candidate in this race. I don’t take a dime of their money, and when I am president, they won’t find a job in my White House.
Things have changed quite a bit since then. William M. Daley has come to hold one of the most powerful positions in the White House. He is now serving as President Obama’s chief of staff. This is how the New York Times describes Daley:
He is a top executive at JPMorgan Chase, where he is paid as much as $5 million a year and supervises the Washington lobbying efforts of the nation’s second-largest bank. He also serves on the board of directors at Boeing, the giant military contractor, and Abbott Laboratories, the global drug company, which has billions of dollars at stake in the overhaul of the health care system.
Does anyone remember when President Obama recently met with business leaders for a “working meeting” shortly after the midterm elections? The press touted the meeting as a positive step towards signaling to the business community that President Obama was committed to improving the economy and jobs by working more closely with business leaders. The NYT mentions a similarly encouraging benefit to be reaped from the new White House chief of staff:
But hiring Mr. Daley, who served as Commerce Secretary under President Bill Clinton, would almost certainly improve icy relations between the Obama administration and business leaders.
This is one way of interpreting the situation. President Obama’s recent business-leader meeting and the appointment of Daley as chief of staff are two ways in which the President and his administration are demonstrating that they have come to grips with the fact that many of their actions have created uncertainties and other barriers to business growth which have delayed recovery from the recent financial and economic recession and have maintained unemployment rates at unnecessarily high levels (the current official unemployment rate is 9.4% albeit the real rate including those who have been discouraged from continuing to seek employment is closer to 17%).
Here is another, more disconcerting way, of interpreting these unlikely coincidences. Adam Smith famously stated:
People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.
Business-government collusion is much more dangerous than collusion among businesses only. When government and business get together to “cooperate” on matters of policy, we often get what’s called “crony capitalims,” an economy that’s dependent on close relationships between business people and government officials. As business and government decide on how to best divide the economic pie, taxpayers are the ones to loose out.
It’s time to tighten the grip on our wallets and pay close attention to the policies coming out of the White House in the near future.