Janine Wedel - Unaccountable - How Elite Power Brokers Corrupt Our Finances, Freedom, and Security

And yet the question remains: How to institutionalize the needed voices and oversight? How to get those outsiders in?

What has happened to move the center of policymaking gravity away from formal organizations and toward epicenters of players and networks that circle in, around, and also away from the organizations?

What has happened is a sea change, and it has ushered in the new unaccountability. And unaccountability, as I said earlier, is a necessary—though not complete—precondition for the new corruption.

Several transformational developments over the past few decades have broken down barriers and allowed power brokers to hold more sway. They include the privatization, deregulation, and governmental “reform” fervor of the West that began to take hold in the United States and the United Kingdom in the early 1980s; the end of the Cold War a decade later, dispersing global authority and opening up sparsely governed arenas; and the rise of the Internet and digital technology soon after that. 53For better, as well as for worse, these developments, both on their own and through their interactions, have created myriad new opportunities for individuals, networks, ad hoc groups, companies, and nongovernmental organizations, be they private contractors carrying out functions heretofore mostly performed by governments; transnational networks laundering money or promoting human rights; currency traders conducting instant global transactions; or denizens of the Web gracing us hourly with their opinions.

This sea change has altered how we interact with corporate and government organizations (unidentifiable bureaucrats who know too much about us while we know precious little about them); instituted formulaic ways of dealing with the customer (the Mobius phone loop); helped to disconnect institutional trust from value (derivatives trading); produced power brokers who are in organizations but not of them; and served up leaders who give us ample reason for the decline of the public trust (certain former heads of the democratic world).

This sea change has even reconfigured what constitutes government. In the old world, government meetings were mainly made up of government officials. In the new world, a very real question is: Who is the government? Today, contractors, consulting firms, think-tankers, and quasi-official bodies daily stand in for it, in the process composing a more dispersed and fragmented governing system. In the United States, for instance, three quarters of the people working for the federal government actually now work directly for private companies, sometimes with a lot of influence and often with little oversight—but always focused first on the bottom line, not the public interest. 54Contractors (think Edward Snowden) run intelligence operations, control crucial databases, screen airport security and law-enforcement officials, choose and oversee other contractors, and draft official documents. 55And there’s been an increase in the numbers and influence of think tanks and quasi-official bodies like government advisory boards. 56

The sea change has also diversified and obscured the missions of both official and private organizations. In the old world, the military fought wars, think tanks published policy reports, and media investigated and reported the news. Boundaries were clearer and organizational missions more narrowly focused. As we shall see in Chapter 9, today, campaign fund-raising groups pose as nonprofits or grassroots organizations. 57Chapter 7 shows think tanks acting as news outlets. 58News outlets and even military units function like entertainment companies. Navy SEALS, the same armed force that killed Osama bin Laden, co-produce a film with Hollywood in which the SEALS play themselves.

Businesses, too, are stretching into areas far beyond their traditional reach, not to mention beyond the reach of regulation, oversight, and accountability. Several large banks have become traders in commodities like aluminum, activity enabled by lax oversight. 59Goldman Sachs, Morgan Stanley, and JPMorgan Chase have conducted commercial activities that include power production, port management, oil drilling and distribution, and uranium mining. 60In 2011, the New York Times reported, “an internal Goldman memo suggested that speculation by investors accounted for about a third of the price of a barrel of oil.” 61

The sea change has meant that an octane-charged flexibility is the key to getting ahead. The new era is all about “flex,” responding to the opportunity of the moment and bending in whatever way serves a player’s interests best. The era’s most successful actors are adept at ambiguity, line-blurring, reinventing, self-regulating, adapting, and branding, all the while pushing the limits of acceptability.

Flexibility is so much a part of the modus operandi of today’s top power brokers that I coined this term to describe them: flexian. 62

An archetypal flexian is Lawrence Summers, who we will examine in greater depth later in the book. As one of his friends said about him in 2013, “[Summers has] been going about his life just on the basis of ‘who knows what’s going to come next?’ and just sort of maximizing his experiences, given the opportunities in front of him.” 63He has certainly “maximized experiences” over the decades, to the point where it is hard to even enumerate the number of roles he has taken on. Here is a partial list: economist; deputy Treasury Secretary under Clinton; president of Harvard; Treasury Secretary (also under Clinton); sought-after public speaker; op-ed writer; think-tanker; senior economic adviser to the Obama White House; university professor at Harvard (the highest academic rank); adviser to a vast assemblage of Wall Street and corporate outfits, including hedge funds, a trading floor operator, an asset manager, a venture capital firm, and big banks such as Citigroup.

Many of us perform multiple professional roles. But when they mesh in ways that disguise our true agendas or contradict the public agendas we purport to serve, defying accountability and transparency, therein lies the potential for violation of the public trust.

As Harvard’s president, Larry Summers did consulting work for a hedge fund from 2004 to 2006. He then used the founders of the hedge fund as part of an “informal brain trust” that he tapped when taking on the top economic advisory role in the Obama White House. Summers also uses the media to brand himself as an impartial guardian of sound public policy. In writing an opinion piece in the Washington Post in 2013, he was described as “a professor and past president at Harvard. He was Treasury secretary from 1999 to 2001 and economic adviser to President Obama from 2009 through 2010.” How is the public to know that the vast majority of his current income is derived from Wall Street and corporate gigs? 64

The sea change requires that we alter how we make sense of the world. In this brave new world, which I make sense of as an anthropologist, the players themselves often are the pillars of power. They perform multiple and sometimes overlapping roles across government, business, think-tank, and media organizations, and it’s sometimes difficult to tell where one organization or role ends and the other begins. Influence is vested not so much in organizations but in players who operate in and around them and connect them through their multiple roles and informal networks. Their very power stems from their ability to connect the dots—to blend and blur official and private boundaries—and from their flexibility and ability to fudge boundaries.

In other words, the very power of these power brokers stems from their ability to be unaccountable.