Defending the Republic, Policy Domination

Defending the Republic: Scenario 2 Policy Domination


Greenman House
Greenman House

Defending the Republic, Part 1: Introduction provided a general introduction and an initial listing and description of the scenarios. The second part looked at the three variants of the Regulatory Capture scenario. Both asked why corporations are enacting social justice programs. The two blogs suggested that at least part of the reason may be that corporations are rated by their Environmental, Social, and Government (ESG) scores. For example, the Schwab research page for a company shows their ESG scores. But is reporting ESG scores and other social justice indicators enough to compel corporate behavior?

The Coca Cola shareholder actions discussed in part 2 are an indicator they are not. Many, if not most, shareholders want to maximize shareholder value. This is even more the case with mutual funds and other investment companies that have the same fiduciary responsibilities to the fund owners that corporations have to their shareholders. For example, Blackrock, which is/was a leading proponent of social investing, is coming under pressure for their stances.

The fundamental question is whether the multi-industry collusion is based on rent seeking behavior or not. When we look at the social justice movement, there are two beneficiaries.

First, the people that work in the social justice industry owe their livelihood to it. In this sense, the situation is like pharmaceutical companies that owe their incomes to “treating disease”, such as cancer and diabetes. These companies have no incentive to cure the diseases. To do so, eliminates critical revenue streams. One can make the case that the poverty industry has the same incentives to keep people in poverty rather than eliminate poverty. As noted in part 2, McKinsey estimates the social justice industry will be over $15B by 2026.

Second, corporations gain for the increased power they hold over congress and the bureaucracy. Lobbyists funnel incredible amounts of money to politicians to influence—some may say buy—their votes. With the amount of money sloshing around the system, few politicians can resist its siren call. The bureaucrats have similar issues with the revolving door between the bureaucracy and the industries they regulate.

This is about corruption and power. As Lord Acton wrote, power corrupts, and absolute power corrupts absolutely. We see this in play in congress and the bureaucracy. A new politician comes into congress, often with high ideals and goals. But to get anything done, they must make deals. At first, the deals may be benign, but the deeper they get into the deal making, corruption seeps in a little at a time. And ensnares the politician is a web of corruption, of which he or she may not even be fully aware. There are those in this country that care more for power than they do for freedom and the Republic.

It may also be about national security and threats. What better way to overthrow a global power than to weaken it from the inside? If we think corporations are addicted to social justice, the government is even more so. Between destructive government social programs (see the inflection point series), government contracting regulations (large contract set asides for targeted demographics), government hiring and personnel regulations, the government is fully woke.

Now, I admit there are issues we need to work on. But approaches the government put do not work. Now, with the social justice movement, the pressure and the government compulsion are even higher. And the government eats its own dog food in this case. From the most senior positions on down, government managers select based on surface criteria rather than competency. We have progressively lowered the standards to hire and promote based social justice’s protected classes. This practice not only wastes incredible resources, but it does little to really help the people it hires.

But we are still left with the question, why are we doing this? Why do we want the government to be corrupt and ineffective?

There are two potential answers. Both have to do with the hidden hand holding the puppet strings. Yes, we can easily blame the black man, representing the social justice movement and the pirate representing corporate interests, but I suspect they are really henchmen.

The hidden hand belongs to either an outside state actor, such as China, or an outside force, a non-state actor, that seeks to control the government. The government has the power to compel behavior and selectively enforce its will through the state apparatus such as the IRS, FBI, and CIA. We are seeing this unseen hand working now to further its master’s political aims. The Constitution is just a fig leaf to cover their activities and make most Americans think all is still well with the republic when it most definitely is not.

These forces, operating either together or independently, seek to dominate policy and resources to control society while the vast majority of Americans do not see it. The government becomes their vehicle to exert power while keeping most citizens ignorant of their efforts.


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