Janine Wedel - Shadow Elite - How the World's New Power Brokers Undermine Democracy, Government, and the Free Market

My goal here has been to lay out the problem and identify patterns so that, at the very least, we can comprehend the new phenomenon. To change something, you must first understand it. I have written this book so that others can use the same lens to identify the players to which the transformational developments of the last quarter century have given rise. Their numbers and influence are sure to multiply in the coming years.

The rise of the shadow elite warrants revisiting age-old thinking on corruption. In the New Testament, the author of the Gospel of Matthew wrote, “No one can serve two masters; for a slave will either hate the one and love the other, or be devoted to the one and despise the other” (Matthew 6:24). This is corruption at its most basic—a violation of public trust. Flexians and flex nets pursue the ends of their own ideological masters, which often contradict the other masters they supposedly serve. The challenge for policymakers and readers, now that the problem has been laid out and the animal named, is to work toward recovering that public trust.

NOTES

Notes to Chapter 1

1. Anthropologist Aihwa Ong discusses “flexible identities” in Aihwa Ong, Flexible Citizenship: The Cultural Logics of Transnationality (Durham and London: Duke University Press, 1999).

2. Intelligence expert Steven Aftergood has employed the term “coincidence of interest” in this meaning, as cited in Tim Shorrock, “Former High-ranking Bush Officials Enjoy War Profits,” Salon.com, May 29, 2008,

http://www.salon.com/news/excerpt/2008/05/29/spies_for_hire/index1.html.

3. The New York Times article reference is David Barstow, “One Man’s Military-Industrial-Media Complex,” New York Times , November 30, 2008, http://www.nytimes.com/2008/11/30/washington/30general.html.

Defense Solutions is the name of the company on whose behalf McCaffrey contacted Petraeus.

4. Ibid.

5. The earlier piece in the Times appeared in April 2008. David Barstow, “Behind TV Analysts, Pentagon’s Hidden Hand,” New York Times , April 20, 2008, p. A1, http://www.nytimes.com/2008/04/20/washington/20generals.html. The Times characterization of the call for an investigation is from David Barstow, “Inspector General Sees No Misdeeds in Pentagon’s Effort to Make Use of TV Analysts,” New York Times , January 16, 2009, http://www.nytimes.com/2009/01/17/washington/17military.html.

The Pentagon’s inspector general report is, Department of Defense, Office of Inspector General, Examination of Allegations Involving DoD Public Affairs Outreach Program , January 14, 2009, Report Number IE-2009–004, http://www.dodig.mil/Inspections/IE/Reports/ExaminationofAllegationsInvolvingDoDOfficeofPublicAffairsOutreachProgram.pdf. Responding to the report, the Times found striking factual errors in the DoD’s investigation, including that several military analysts who have easily documented affiliations with defense contractors are listed as having no such relations. The Times also pointed out inherent weaknesses in the DoD’s investigative approach (Barstow, “Inspector General Sees No Misdeeds . . . ”). For McCaffrey’s response to the Times , see http://www.reuters.com/article/press-Release/idUS70468+17-Jan-2009+PRN20090117, and for response from McCaffrey’s consulting company, as well as a friend, see http://www.mccaffreyassociates.com/pages/news.htm. For response by the Times’s ombudsman to these points, see Clark Hoyt, “The Generals’ Second Careers,” New York Times , January 25, 2009, http://www.newsombudsmen.org/cgi-bin/ono_article.pl?mode=view&article_id=1232910801.

For information on steps taken (and not taken) by the Obama administration with regard to the Pentagon Inspector General’s report, see Frank Rich, “Obama Can’t Turn the Page on Bush,” New York Times , May 17, 2009, p. WK12. See also Glenn Greenwald, “The Ongoing Disgrace of NBC News and Brian Williams,” Salon.com, November 30, 2008, http://www.salon.com/opinion/greenwald/2008/11/30/mccaffrey/ (accessed April 15, 2009), and Glenn Greenwald, “NBC and McCaffrey’s Coordinated Responses to the NYT Story,” Salon.com, December 1, 2008, http://www.salon.com/opinion/greenwald/2008/12/01/mccaffrey/ (accessed April 15, 2009). In addition to the Pentagon’s inspector general, the Government Accountability Office and the Federal Communications Commission also initiated investigations of the Pentagon’s program. In July 2009 the GAO found that the Pentagon did not violate propaganda laws. See: GAO, “Department of Defense—Retired Military Officers as Media Analysts,” July 21, 2009, p. 2, http://www.gao.gov/decisions/appro/316443.pdf.

6. Jon Stewart’s The Daily Show , January 26, 2005, http://www.thedailyshow.com/video/index.jhtml?videoId=113523&title=headlines-the-rice-storm&byDate=true.

7. The political-legal scholars here quoted are: Yves Dezalay and Bryant Garth, The Internationalization of Palace Wars: Lawyers, Economists, and the Contest to Transform Latin American States (Chicago: University of Chicago Press, 2002), pp. 11, 10.

8. For mention of Schroeder having negotiated the deal as chancellor and other facts, as well as commentary, see: BBC, “Schroeder attacked over gas post,” December 10, 2005, http://news.bbc.co.uk/2/hi/europe/4515914.stm. For Washington Post editorial, see: Editorial, “Gerhard Schroeder’s Sellout,” Washington Post , December 13, 2005, p. A26, http://www.washingtonpost.com/wp-dyn/content/article/2005/12/12/AR2005121201060.html.

9. See, for instance, Ian Traynor, “Poland Recalls Hitler-Stalin Pact Amid Fears over Pipeline,” The Guardian , May 1, 2006, http://www.guardian.co.uk/world/2006/may/01/eu.poland.

10. Information provided by a Russian journalist who heard about the deal in April 2005.

11. The Russian sociologist here quoted is Olga Kryshtanovskaya, interviewed by Pavel Zhavoronkov, “Proiskhozhdenie VIPov. Bogatstvo v Rossii Ostaetcia Privilegiei Nomenklatury” (The Origin of VIPs: Wealth in Russia Remains the Nomenklatura’s Privilege), Kompania , May 15, 2003, http://maecenas.ru/doc/2004_5_6.html.

Gazprom monopolized (and still monopolizes) the gas sphere, including its international aspects conducted in the interest of the Russian state, not a private corporation. (Gazprom remains a strategic organization of the Kremlin, in which the power of the Kremlin clearly resides. It is in complete control of prospecting, transport, sale, distribution, pricing, and international activities.) Gazprom was born in 1989 in the Soviet Union’s dying days when entire resource-rich ministries (in this case, the Ministry of Gas [the official translation is Soviet Ministry of Gas Industry]) were transformed into state enterprises under the personal control of members of the nomenklatura . While Gazprom was turned from a state ministry into a so-called private corporation in 1993 (after first being converted into a joint-stock company under the leadership of the prime minister, Viktor Chernomyrdin), the state owns more than 50 percent of its stock. (In November 1992, Russian president Boris Yeltsin signed decree #1333 “On the transformation of the state gas concern Gazprom into Russian joint-stock company ‘Gazprom.’” See, for example, Elena Ivanova, “Gazovaia Industriia” [Gas Industry], Vlast’ , no. 47 [November 27, 2001], http://www.kommersant.ru/doc.aspx?DocsID=295883. See also “Theft of the Century: Privatization and the Looting of Russia. An Interview with Paul Klebnikov,” The Multinational Monitor 23, nos. 1, 2 [Jan/Feb 2002], http://multinationalmonitor.org/mm2002/02jan-feb/jan-feb02interviewklebniko.html.)