How Capitalism Will Take Your Freedom
Posted by
Kevin
So it seems that the Bush Administration apparently started spying on Americans without warrants before 9/11:
Mr. Nacchio said last year that he had refused an N.S.A. request for customers’ call records in late 2001, after the Sept. 11 attacks, as the agency initiated domestic surveillance and data mining programs to monitor Al Qaeda communications.
But the documents unsealed Wednesday in federal court in Denver, first reported in The Rocky Mountain News on Thursday, claim for the first time that pressure on the company to participate in activities it saw as improper came as early as February, nearly seven months before the terrorist attacks.
The significance of the claim is hard to assess, because the court documents are heavily redacted and N.S.A. officials will not comment on the agency’s secret surveillance programs. Other government officials have said that the agency’s eavesdropping without warrants began only after Sept. 11, 2001, under an order from President Bush.
But the court filings in Mr. Nacchio’s case illustrate what is well known inside the telecommunications industry but little appreciated by the public: that the N.S.A. has for some time worked closely with phone companies, whose networks carry the telephone and Internet traffic the agency seeks out for intercept.
If this is true, and it does fit their history, there are a couple of points here aside form the Bush Administration’s strange and overwhelming desire to be remember as less competent imitators of Pinochet. All but one company went along with this power grab and 9/11 happened anyway. Obviously, the spying program did little good to protect the country. Which is expected. If you have read the 9/11 Commission report, the problem was almost never a lack of intelligence. The problem was that intelligence was not shared, out of professional jealousy and incompetence primarily, and we did not have enough trained analysts to review the intelligence we did have in time to prevent the attacks. So the next time someone on the right whines about how having to obey the Constitution means hat we are all going to die! die! die!, remind them that the Bush Administration has been ignoring the Constitution since before 9/11 and it did us no damn good.
The second important point in this story is that the telecom companies all bowed before the government, at least in part, because they were afraid of losing large contracts. Their economic well being demanded that they comply with spying on their customers and so they did. There may have well been other reasons for their capitulation, but it needs to be noted that when the government failed to provide strong oversight of their behavior, they ran for the quick buck, regardless of the effect of their actions on their customers, their fellow citizens, and their country. From the standpoint of business, it makes perfect sense. Which, absent strong government oversight, is why it will happen again and again.
Without a strong reason not to, telecom companies will almost always put their economic interests ahead of any other considerations; it is what corporations are designed to do. Markets cannot keep you free, because markets care only about profit and loss. The pressure to produce profit and avoid loss eventually means that, in an unfettered marketplace, the scrupulous will almost certainly be driven out of the market by the unscrupulous. When government oversight breaks down, as it did spectacularly in this case, the free market will chain you as fast as any government. They might, if they are very clever, even get you to pay for the chains yourself.
Wait, so the government uses its control over a large part of the telecom market to coerce companies into cooperating with an illegal government surrveilance program, and this is somehow proof that the government needs MORE control over the telecom market?
Comment 10/16/2007
Government oversight failed, SD. there was no control over the telecom industry because ONE section of the government was not properly and adequately held in check by the laws and institutions that were supposed to do that job. The failure of the Bush Administration to do its job is not an argument that government regulation is the problem; it is an argument that the Bush Administration is incompetent and, perhaps, that the checks we have on that particular branch of the government are insufficient.
Because if their was no government oversight, you can bet everything you own that ATT, for example, would have done this for any large enough contract.
Comment 10/16/2007
Wait a minute, are you telling me that our government has been engaging in illegal, warrant-less wiretapping since before 9/11?… No way!
And in other news, the sun rises in the East.
I’m still generally at a loss to find anything that government has done since 9/11, (the alleged point at which it threw out the Constitution) that they weren’t doing on 9/10. All they’ve done is be a little more candid about behavior previously kept more secretive.
Adherence to the Constitution is, and has been since day one, subject to the whims are interests of the powerful and moneyed.
Illegal government wire-tapping pre-9/11 is the classic dog bites man that registers as man bites dog in our consciousness because of our reluctance to accept the extent to which our own sordid and hypocritical history.
Comment 10/16/2007
>there was no control over the telecom industry because ONE section
>of the government was not properly and adequately held in check by
>the laws and institutions that were supposed to do that job
Any such oversight would be provided by the same section of government (i.e. the executive branch) that was responsible for the problem to begin with.
Comment 10/16/2007
Kevin, thanks for the entertainment.
Comment 10/16/2007
SD
If that is true, then it means that the problem is not in government oversight, but in the particular structure of that oversight. You haven’t even begun to explain why government oversight is not needed or cannot be effective.
TEd and SD: tell me straight up — do you or do you not think ATT would do tis for anyone if it could if the price was right?
Comment 10/16/2007
Kevin, no, if it were clearly illegal, I don’t think ATT would do it. If it was marginally legal, I don’t know. If for no other reason than there is too much to lose. Also please keep in mind that ATT does not make decisions. People who work there do. And those people are subject to criminal prosecution if they break laws.
You might think that everyone who works for a large corporation automatically turns into a soulless criminal, but my personal experience does not support this (in fact my sister was an in-house attorney for ATT for several years).
I have not heard either way, but are you saying NSA paid the telcos? If not, then your whole profit motive subplot seems to go out the window.
My counter question to you is: straight up, do you believe government employees will accept bribes if the amount is large enough? Or how about this - would you prefer a free press or one controlled by the state? Never mind, that is off topic.
I’m all for appropriate government regulation of commerce, but to cite as an example of the evils of capitalism a case where a government agency pressured a publicly-owned company into cooperating with a government program, well let’s just say I remain unconvinced.
Comment 10/16/2007
Ted
I think I am not explaining myself well: without government regulation - -without strong privacy laws and enforcement of those laws — the profit motive would dictate that ATT, and I am only using them as an example not because they stand out in anyway, that ATT sell customer data or allow wiretapping of customer phones under certain circumstances. Its built into the incentives of an unregulated free market. The market would not protect you from this unless it was more profitable to do so, something I think we both agree is not acceptable.
Its not that people who work at companies are evil - -its just that the incentives of an unregulated or poorly policed market run to only profit maximization and, eventually, people are either buried by that or succumb to it out of necessity.
Comment 10/16/2007
Kevin, no, if it were clearly illegal, I don’t think ATT would do it.
s/ATT/WorldCom/g
s/ATT/Enron/g
s/ATT/Tyco/g
Whoops.
Comment 10/16/2007
tgirsch, shall I counter with a list of corrupt public servants? Mine would be 1000’s of names long. Would that prove moral superiority in the private sector?
Kevin, I agree with your last comment with the caveat that the profit motive does not dictate that people act as criminals any more than any other motive does.
You claim that the telcos cooperated out of fear of losing large contracts. Can you back that up with some evidence? Your implication is that NSA (a government agency) extorted the companies. I think that would have made the news if it were a proven fact.
Comment 10/16/2007
Kevin, I agree with your last comment with the caveat that the profit motive does not dictate that people act as criminals any more than any other motive does.
I’d say, not more than any other equally strong motive does. Now we need to list equally strong motives…
I think it is pretty self-evident that financial profit is up there with the strongest of potential motives for criminality.
Out of curiosity, what other motives did you have in mind, Ted?
Comment 10/16/2007
digg, this is getting a bit blurry, but I meant profit motive as it exists within a company (ie an employee acting criminally to advance the corporate cause), which is not the same as a personal motivation for financial profit. I mean, if a guy in a country that has a completely government-owned/run economy mugs someone on the street and steals $100, is that a socialist crime, a capitalist crime, or a personal crime? When a public servant in the US accepts a bribe, is that a capitalist crime? When the US Government utterly fails at overseeing the billions of dollars that are being wasted in rebuilding Iraq, is that a condemnation of the private companies doing the work or an indication that government-run programs are full of waste (the “not my money” syndrome). When legislators pass bills that favor specific industries and then immediately go work for those companies, is that a failure of government or a failure of capitalism?
I think we all agree that most people are motivated to better themselves and their lot in life. I believe - and my life experience has shown me - that working for and/or running a company that exists to make money does not turn one into a criminal, any more than working for the government turns one into a saint.
I do find it interesting that anecdotal evidence of government wrong-doing is always dismissed by the LL guys as something other than evidence that governments can be flawed, but examples of wrong-doing in the private sector are reasons to condemn capitalism (I don’t direct this at you, I understand you believe everything and everyone is flawed beyond salvation
) For example, the catastrophic failures of the US government in the Middle East are due to specific bad guys, but the pilfering of TYCO by a couple of execs proves that capitalism is evil.
I do believe that poverty is the root cause of the majority of crime, but once people have a reasonable income, financial gain is no longer the primary motivation for crime. That would be an interesting set of statistics - specific crimes plotted vs income level. I realize I have not directly answered your question, but I hope I have explained my position in such a way that your question is no longer important.
Comment 10/16/2007
Ted
The article tlaks about how Quest claism to have lost business becasue they refused to co-operate; that’s what I was talking about.
As for the government vs. capitalism claim, its because there is nothing special about corruption. A government official is not corrupt because all government service incentives corruption; this, if true, however, is an example of how capitalsim incentivies destruction of personal liberty.
More importantly, there aren’t people going around claiming that all government all the time will end in nirvana — there are such people doing the same about markets. Its important, I think, to remind them that
Comment 10/16/2007
“The article tlaks about how Quest claism to have lost business becasue they refused to co-operate; that’s what I was talking about.”
Well, no. Convicted insider trader Nacchio claims that as part of his appeal. You see, part of the case against him was based on the fact he was proclaiming that Qwest had a rosy financial future as he was dumping stock. He was dumping stock because Qwest did not have a rosy future. What he (and to my knowledge only he) is now claiming is that part of the reason he was claiming Qwest was in good financial shape was because they (Qwest) were about to sign lucrative secret deals with NSA and other gov’t agencies. Of course since this was secret so he couldn’t actually say this, but that was why he thought the company was about to do well financially – even though everyone else in a position to know knew the company was tanking.. Of course the contracts didn’t come to pass, and part of his story now is the reason they didn’t come to pass was because NSA was punishing the company. So please understand why I don’t give a whole lot of credibility to Nacchio’s story, and will withhold indictment of all of capitalism until there is a bit more evidence that the other telcos did what they did for financial gain.
In the article you snipped the following:
“But the court filings in Mr. Nacchio’s case illustrate what is well known inside the telecommunications industry but little appreciated by the public: that the N.S.A. has for some time worked closely with phone companies, whose networks carry the telephone and Internet traffic the agency seeks out for intercept.”
…you ended the snip here, leaving out the very next text which reads:
“Some of the cooperation is related to the agency’s second major responsibility — the protection of classified government communications systems against eavesdropping or hacking by adversaries. The documents reflect constant meetings and negotiations between the agency and Qwest officials over the global communications network.”
As for your statement that:
“The pressure to produce profit and avoid loss eventually means that, in an unfettered marketplace, the scrupulous will almost certainly be driven out of the market by the unscrupulous.”
In this case, your scrupulous individual turns out to have been convicted of 20 or so (too lazy to get exact number) counts of fraud and insider trading.
I can’t say what I am about to say without being offensive, and I apologize for that, but, whenever I read one of your posts, I frequently end up feeling like you have consciously and deliberately manipulated the facts to enhance your piece. I find this very frustrating because most of the time I agree with your basic premise, but I have a very strong reaction whenever I believe someone is being intentionally deceptive. Or perhaps just intentionally naive.
Comment 10/16/2007
Ted,
Thank you for your response. All I can really say is something, I’m sure you know. Thoughts, perceptions, personal/political philosophies, etc. are extremely complicated animals. It is often difficult to separate the carts and the horses. Do you see something as evidence of X, and that is why you believe Y? Or, do you believe Y, and that is why you see that something as evidence of X? Empiricism really doesn’t exist when we deal with socio-political and philosophical questions. Implicit association research has proven that we have, generally speaking, a rather poor understanding of the roots of our own preferences. So, I guess it is both your world view influencing how you perceive actions, and the actions themselves influencing your world view at the same time.
Whether you view a “crime” as personal, socialist, or capitalist by nature, or to what cause you attribute corruption within a specific system, these are questions that can’t be separated from one’s opinions on tons of other questions, each one, complicated enough in and of itself to elicit years and volumes of debate by some of civilization’s most accomplished minds.
Comment 10/17/2007
Ted:
The only thing that my list was intended to “prove” was that corporations can and do break the law all the time, especially when they don’t expect the laws they’re breaking to be actively enforced.
And a long, long list of corrupt public servants is just another reason why we need to have more checks and balances built into the system, rather than fewer.
Honestly, I don’t think we really disagree about any of this; it’s just that Kevin’s cynicism about corporate motives, and about the idea of a so-called “free market,” always seems to trip some ire in you somehow. It’s like a reflex action or something.
Comment 10/17/2007
Tgirsch, as long as you remember that “corporations” don’t actually break laws - it is the people who are employed by the corporation that do the unlawful things.
Do small businesses break the law all the time, or does the basic lawfulness of people change as the size of their employer increases?
Your generalization does not hold much weight with me.
Finally, while I agree with you that regulation is required in certain cases, and that checks and balances can be helpful, I hope you agree that they are not a panacea, nor are they without cost. There is an inefficiency associated with regulation and checks and balances, so at some point (and I am not arguing we are even close in most cases) the cost of the oversight can outweigh the benefits.
Digg, good point.
Comment 10/17/2007
“If this is true”
Those are key words.
“Obviously, the spying program did little good to protect the country.”
Why is that obvious? Do you know that the program didn’t prevent other attacks? Just because one attack took place doesn’t mean other attacks weren’t prevented.
Comment 10/17/2007
Ted:
as long as you remember that “corporations” don’t actually break laws - it is the people who are employed by the corporation that do the unlawful things.
Would that it were so. Unfortunately, our laws are so screwed up that the corporation is itself viewed as a person. The corporate veil isn’t as [thin] as it used to be, but it’s still there.
As to the size of the company, that generally only dictates how much they can get away with, not what sort of behavior to expect. I suspect that in terms of things like worker exploitation, small employers are among the worst. But that’s another topic for another time.
There is an inefficiency associated with regulation and checks and balances
True in the short term. In the medium to long term, I’m less convinced. I think it makes sense to err on the side of regulation. I’ve said before that my personal philosophy can be oversimplified as “Let individuals do what they want (within reason), and regulate the holy shit out of businesses and organizations.” What I mean is that we should err on the side of personal liberty at a personal level, but monitor very closely what companies and organizations do. Especially when they’re engaging in commerce.
I think it has to be the government that does this latter sort of regulation. If the government isn’t there to ensure some modicum of fair play, then eventually no one will. I think that was largely Kevin’s point.
Comment 10/17/2007
Ted,
The general point that Kevin is making is that an entirely unfettered market economy acts has inherent consideration for that which is ethical. Now that is applied to the paradigm of unrestricted capitalism as an abstract entity.
When actually put into place there a couple of ways to institute the protections against actions that are in the general interest of “capitalism” or of “business’ but are contrary to the interest or well being to the people of the society in which that business operates and that economic system is implemented.
One way is the moral consciousness of the individual members of that society. I will not work for Bechtel, period - even if they offered me ten million dollars a year, paid out in checks of twenty dollar increments that I had to deposit myself in a special bank built between Jessica Alba’s breasts.
Another way is also human. Humans bestowed with some form of legislative powers can institute measures designed to prevent the market from engaging in financially profitable, but socially destructive behavior.
Our lifestyles are environmentally unsustainable. Our children are performing worse and worse academically, in relation to other nations, every year. Our debt is growing. The incarceration rate of black men in our country tops that of South Africa during apartheid. Our military is overextended, while many contend that our homeland is less than secure. Yet,the profits of industries such as, oil, arms, prisons are setting record numbers, as is the compensation of the senior individuals within those companies and industries. So, clearly, the impediments to financial gain at the cost of a healthy society are not strong enough.
The power to resist this at an individual level is strangled by the fact that the individual experience is a microcosm of the corporate experience. The pressures to support oneself, and to get ahead, mitigate an individual’s practical capacity to take a moral stand and refuse to participate in such a dynamic. The further along a person has gotten, the more practically feasible it becomes for that person to “regulate” him/herself and privilege ethics and sustainable living above the further accumulation of wealth that no longer accommodates basic necessities, but increasingly luxurious wants, and ultimately ostentatious whims.
So, who’s a criminal, and who’s a victim. It’s kinda complicated. If you are willfully acting socially/ethically irresponsible to further your existant fortune, you are a criminal and a piece of scum - though you are only acting out the tenets of the economic system under which you live. You are conditioned in a sense to be a criminal - but you are a heinous criminal nonetheless. The mailroom clerk at Haliburton is a criminal only in the sense that the bartender who accepts the tip from the gangster sitting at the bar is.
It is in that sense that businesses and the wealthy and powerful people who represent them are representative of, and actual institutions of the otherwise abstract economic systems of society. These “people” you speak of are inextricable incarnates of unfettered, ethically-devoid capitalism. And, it is in that respect that I feel I can judge them and the economic system that defines them in one swoop, intellectually honestly.
Comment 10/17/2007
Tgirsch, my point was not that a corporation can not be held responsible, but rather that it (the corporation) is not a living, decision-making being. The criminal acts are conceived, planned and executed by human beings.
Digg, my reading comprehension must be slipping. I can’t fathom your first paragraph.
As for your last, you are certainly free to harbor your prejudice. But don’t expect me to accept it.
Comment 10/17/2007
Warning, KTK-length post coming…
My comment was kind of a reaction to your assertion that it is not the economic system or the corporation that acts immorally, but people who do so.
Neither the system of capitalism, nor the idea of the corporation have an inherent disposition towards immorality. Well, neither are they predisposed towards morality, correct?… They are abstract entities - they don’t have inherent morality.
The idea of capitalism is guided by its own principals, mainly to maximize profits and minimize expenses. The act of doing so disproportionately leads to the condoning of immorality, because it is against a company’s financial (profiteering) interest to design and implement regulatory processes and agencies to curtail such immorality. Doing so costs money and interferes with profits. Certainly, if you tip too far toward the “evil” side and do nothing to regulate your actions, you risk alienating your consumer base by offending their morals and suffering the economic consequences thereof.
Nonetheless, it seems obvious that left to itself, there are more motives toward not regulating unethical behavior than there are to regulate such behavior, when we look at capitalism in a vacuum.
Remember, “living wages,” “child-labor laws,” “compensated overtime,” etc. are all things that we accept as part of our capitalistic society, but they are reforms that run counter to capitalism itself from a purely economic perspective.
Therefore, even if, as an abstract entity, an economic philosophy does not have an ethical value in and of itself, it is perfectly reasonable to believe that some are more conducive toward unethical, socially-destructive behavior than others.
And, here’s another question. If the economic model is not predisposed, or conducive to unethical behavior, where does such bevior come from, what is the motivation? Are those individuals who act for the company predisposed to unethical behavior? But to what extent are they even acting as “individuals?” And, to what extent are they acting on behalf of the corporation, or of capitalism, respecting only the laws of those institutions, disregarding any ethical considerations?
That’s why I say that those whose actions are perpetrated as pure agents of capitalism can’t be separated from that system and viewed wholly as individuals - they have taken on the properties of the system for which they bid, and become ostensible embodiments of a system - complete with a disregard for the ethical standards of humanity.
In a metaphysical sense, I don’t wholly agree that individuals make decisions, and not economic models or value systems. The implication of one’s potential choices are at least partially defined by the way society is going to view that choice, and what choosing a specific option privileges. An individual’s inclination to privilege greed or wealth above sustainability or health is a complex decision significantly influenced by the way these things are prioritized by the culture in which they live.
That’s why I never really get offended when I’m called irrational; if my underlying values are in opposition to the that of the system that is judging my thoughts, those thought will be viewed as irrational by anybody who attempts to judge my thought from the perspective of the opposing system’s values.
That’s also why I view “human nature” as a culturally relative term usually mistaken for a universal truth. In societies marked by generosity, generosity is considered an element of human nature. In societies marked by greed, the equivalent. I can’t divorce the effect the financial system has on an individual values from his existence as an individual. Those “individuals” who are making decisions for those companies are, fundamentally, products of cultural value system that is greatly influenced by the prevailing economic model.
Economic systems are making decisions, to varying degrees, through the individuals that subscribe to them.
Comment 10/17/2007
“Nonetheless, it seems obvious that left to itself, there are more motives toward not regulating unethical behavior than there are to regulate such behavior,”
Thank goodness we have liberals to look out for our interests. Their motives are always pure.
Comment 10/18/2007
Ah, Morris, wait, don’t tell me…
Ah yes, Book of Ad Hominem - I forget the chapter and verse though.
Comment 10/18/2007
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