I M P R E S S I O N S

The Big Business Backlash
This time, the public may not forget 

by Steven C. Day

2.06.02 |  As much as liberals, myself included, believe that the public should be deeply suspicious of powerful corporations, most people aren’t. They’re conditioned to think otherwise. From the first day of school, we are taught that one of the things that makes America great is the free enterprise system. It’s part of our tradition to admire commercial success — we love a winner. And as a result, at least during good economic times, much of the public isn’t that upset when big business gets special favors from the government.

Or at least that was true before Enron. The $64 million question is, of course, whether the unfolding scandal will change this.

While it is obviously way too early to know for sure, there are reasons to believe that this scandal may have wings. This is a classic morality play, pitting good vs. evil — a rare thing in modern politics, where ambiguity and shades of gray usually abound. But not this time. In this case, innocent employees and investors are pitted against what appears to be an astonishingly corrupt cadre of powerful and wealthy corporate insiders.

All the elements of a great drama are present: Ken Lay urging Enron’s employees to buy the company’s shares at the very same time he was dumping his own; secret off-shore partnerships used to hide huge corporate loses; and a long list of political favors streaming into Enron’s Houston headquarters from the White House and Congress. And now we find out that the deceptive accounting practices employed by Enron may have been used by other companies as well. The whole system is starting to take on the smell of rot.

Republicans apparently believe that the secret to saving their party is to spin the Enron debacle as purely a business, as opposed to a political, scandal. They’re wrong. In fact, the possibility that the public will become disenchanted with big business is perhaps the worst thing that could happen to the GOP. Any short-term ugliness involving the Bush administration or other Republican politicians is chump change by comparison.

It’s getting harder and harder for anyone to hold onto a warm and fuzzy image of modern multinational corporations, or, for that matter, their political benefactors. To believe that the GOP can somehow escape being harmed by an Enron-induced anti-corporate backlash is sort of like thinking that the beef industry would not be damaged if everyone in the county became a vegetarian. The Republican Party and big business have been a happy couple for far too long to try to deny the importance of the romance now.

Of course, the Democrats have not shied away from the joys of easy corporate money either, but as exemplified by the strong GOP bias in Enron’s political giving, the lion’s share of corporate contributions almost always goes to the Republicans. In fact, one of the lessons of the Enron affair is that the Democratic Leadership Council’s dream of a corporate-friendly Democratic Party raking in campaign contributions from big business has been a bust. It turns out that all the party has gotten in exchange for selling its soul are table scraps. The feast has gone to the GOP. And make no mistake, they have earned every penny of it.

Pick an issue, any issue — tax cuts, energy programs, deregulation, environmental policies — and you’ll find the corporate imprint on the Republican agenda. Pick any regulatory board, and you’ll find representatives of the regulated industry appointed to the board by George W. Bush. Say whatever else you want about the Republicans, but they do pay their debts.

The amazing thing is how long the GOP has gotten away with this cozy relationship. Who would have guessed that in a functioning democracy (even one not functioning all that well right now) a political party could consistently pursue policies that favor the wealthiest 1 percent of the population without being whacked at the polls by the other 99 percent? It boggles the mind.

This is one place where I think liberals often miss the point: We tend to assume that the reason Republicans get away with snuggling up to big business is because the public is simply unaware of what’s going on. The truth is that they get away with it because it just doesn’t bother the public that much. For whatever reason, the healthy distrust that Americans have always had for government power has never applied fully to corporate power.

People voted for Bush in the last election not because they didn’t know he was in the pocket of big business; they voted for him despite knowing it. It just wasn’t that big a deal to many voters.

The biggest danger the Republican Party faces in the Enron scandal is that next time it may be.

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Steven C. Day is an attorney practicing in Wichita, Kansas. His previous columns can be found here.

Related Sites
Enron may spark revolt of professionals, argues James K. Galbraith.
A recent Gallup poll asked Americans about the degree to which corporations can be trusted to look out for the interests of their employees. Fifty-one percent say corporations can be trusted "a great deal" or "a fair amount," while 48 percent say corporations can be trusted "only a little" or "not at all."