How Governments Subvert Public Interest | Mark Zupan | TEDxPittsfordMendonHighSchool
## Speaker Context - Speaker role: Academic/Economist discussing political systems and failures. - Setting/Occasion: Unspecified talk (implied expert presentation). - Framing: Discussing why nations succeed or fail, contrasting autocracies with democracies. ## People - Karl Marx: Believed the capitals would capture the political process at the expense of the proletariats. - Louise the 14th: Example of a ruler who could say "the state is me, I basically run the show, I own it." - The Marcos family: Example cited regarding co-option in the Philippines. - Vladimir Putin: Rumored to have personal wealth of 200 billion dollars in Russia. - Navalny: Recently exposed a major palace being built for Vladimir Putin on the Black Sea. - Trio Trujillo: Example of wealth exceeding 100 percent of the GDP of his country. - Mir Osman: Example of wealth being 2 US GDP at the time during British rule in India. - Pension (unspecified): Example concerning China in 1800 BC, cited as ultimate co-opters from the inside. - Hitler: Leader cited regarding ideological motives. - Mao: Leader cited regarding ideological motives. - Stalin: Leader cited regarding ideological motives. - Friedrich Hölderlin: German romantic poet, quoted regarding state/heaven analogy. - Archer Daniels Midland: Company headquartered in Illinois that produces high fructose corn syrup. - Senator for Hawaii and Senator from Illinois: Mentioned as lobbied together to keep sugar imports in place. - Milton Friedman: Credited with the quote, "There's nothing so permanent as a temporary government program." - Columbia University: Mentioned in relation to economists studying political capture. - Raj Shetty: Leading economist at Harvard University who conducted a study. - Kim Jong-un: Leader in North Korea; example used regarding difficulty of buyout. ## Organizations - Pew Research Center: Records and surveys Americans annually regarding trust in U.S. government. - University of Chicago: Economists from this institution cited regarding capture mechanisms. - Democratic/Elected Leaders: Groups that, along with monarchs and bureaucrats, are involved in the supply curve. - Labor Unions/Consumer Advocates: Interest groups that emerged as examples of demand-side capture. - Economic Elites/One Percenters: Group mentioned regarding demand-side capture. - Transparency International: Group that rates countries on a 0-100 scale regarding government transparency. ## Places - US: Location where trust in government has been low, and where sugar quotas cause a net loss of 4.5 billion dollars. - Philippines: Country where the Marcos family example of co-option occurred. - Russia: Country associated with Vladimir Putin's rumored wealth. - Black Sea: Location of a palace allegedly being built for Vladimir Putin. - Dominican Republic: Location of Trio Trujillo's example. - India: Country where Mir Osman accumulated wealth during British rule. - China: Country with examples concerning the Ming Dynasty, canals, and gun powder. - Germany, England: Places where Western European literacy rates were higher than the Ottoman Empire. - Venice: City that once relied on the Silk Road and later on tourism. - North Korea, Russia, Iran, Venezuela: Countries mentioned as modern examples of issues. - Washington: Location where lobbying for sugar quotas occurs. - Louisiana and Hawaii: Places where producers are concentrated regarding sugar quotas. - Illinois: Location of Archer Daniels Midland headquarters. - Georgia: State with a Senator mentioned regarding insider trading. ## Tools, Tech & Products - DNA (Double Helix): Model used as analogy; composed of four amino acids (Cytosine bonds with Guanine, Thymine with Adenine). - Stock Act: Legislation motivated by concerns over insider trading by congressional members. - American dollar: Currency used for quantifying wealth and losses. ## Concepts & Definitions - Trust in U.S government: Metric tracked by Pew Research Center, showing decline from early 60s highs. - World War II / Great Depression: Historical events cited as periods when US trust was high. - Wealth Transfers: The good that is being created and sought in the political sphere, involving individuals and interest groups. - Supply Curve: The concept related to the people who supply the interests (monarchs, elected leaders, bureaucrats). - Capture (Demand Side): When interest groups like labor unions or consumer advocates seize influence on legislation. - Capture (Supply Side): When people within power co-opt the system for personal benefit. - Kleptocracy: A norm of cases where governments go bad. - Ideological Motives: Motives cited as being more important than pecuniary motives in causing political train wrecks. - Double Helix: The structure of DNA, composed of four amino acids. - Political Clout: Ability derived from political power, which can be used to produce wealth transfers. - Gaiety: An aspect of government that is generally considered better in democracies than autocracies. ## Numbers & Data - 1958: Year the Pew Research Center survey started. - Early 60s: Period when trust in U.S. government peaked at 77 percent. - 24: Percentage of Americans today who say they trust government all or some of the time. - 18 percent: Lowest recorded trust level for the US in 2017. - 1800s: Period when autocracies were the norm. - 50: How many years ago the norm of market breakdown thinking regarding political capture was established. - 100 years ago: Time frame relative to Karl Marx's beliefs. - 1200s: Period when new wealth began to acquire political power in Venice. - 1500: Time cited for the Ming Dynasty example. - 250 years: Period during which the Ottoman Empire banned printing (starting around 1578). - 1800: Year cited regarding the Ottoman Empire's literacy rate comparison. - Two to three percent: Literacy rate of the Ottoman Empire. - 12.3 percent: Percentage by which the average senator's personal stock portfolio outperformed the market over 1985 to 2001. - 6.3 percent: Percentage by which congressional reps' and republicans' portfolios outperformed the market over 1985 to 2001. - 37 percent: Percentage of the private sector unionized (past figure). - 6 percent: Percentage of the private sector unionized (current figure). - 117 trillion dollars: Estimated improvement in lifetime earnings from replacing worst-performing public school teachers. - 20 trillion: Current US GDP used as a benchmark for the $117 trillion improvement. - 0-100 scale: Scale used by Transparency International to rate country transparency. ## Claims & Theses - Trust in U.S government has been an all-time low in the last several years. - The US's trust in government was at its high point in the early 60s. - The US trust in government was as low as 18 percent just in 2017. - The decline in trust since the late 60s is reflected by events like the Vietnam War, Watergate scandals, and unsatisfactory government outcomes. - Individuals and interest groups are interested in favorable wealth transfers. - Economists argue that what motivates politicians is political support, whether direct or indirect contributions. - The failure model since the last 50 years focused on demand-side capture (e.g., producers). - Right-wing economists aligned with Karl Marx who believed capitals would capture the process at the expense of the proletariats. - The supply side is largely neglected in analysis. - The role of people on the supply side of politics is that they are human beings with interests. - Politics does the study of who gets what why how when and where. - If the system is co-opted from the inside, the potential profit depends on potential gains (slack) and the interest in exploiting that slack. - Economic stakes do not translate into political clout. - Limiting sugar imports causes a net loss to the US of 4.5 billion dollars annually. - The Ming Dynasty shot itself in the foot due to its rulers and trade restrictions. - The Ottoman Empire’s reliance on the Janissaries led to the downfall when the two Sultans who tried to limit their power were murdered by the Janissaries. - The average democracy is still very far away from a perfect score of 100 in government transparency. - Competitive systems do not guarantee integrity or trust in the government. ## Mechanisms & Processes - Pew Research Center Survey: Annual surveying of Americans to gauge trust in government, started in 1958. - Political Capture (Demand Side): Process where interest groups (e.g., labor unions, consumer advocates) gain sway over legislation. - Political Capture (Supply Side): Process where people within power co-opt the system for personal benefit. - Supply Curve Influence: People supplying interests, including monarchs, democratically elected leaders, and bureaucrats. - Co-opting the System: The ability of people on the supply side to gain benefits from the system's slack. - Symbiotic Capture: How demand-side and supply-side interests get locked in together (e.g., sugar quotas leading to reliance on high fructose corn syrup producers). - Canal/Gun Powder/Monetary Systems: Examples of infrastructure/economic components that, when mismanaged, led to decline (Ming Dynasty). - Seriate Decree: Legislation cited as an example of closing new wealth's political power in Venice. - Immune Immunity: The legal concept making it hard to fire malperforming police officers. - Political Buyouts: The process by which one cannot force a buyout of a political figure like Kim Jong-un. ## Timeline & Events - 1958: Start year of the Pew Research Center survey. - Early 60s: Period of high trust in US government. - Late 60s: Period associated with the start of observed decline in trust due to Vietnam War and Watergate. - 1800s: Period when autocracies were the norm. - Last 50 years: Period since the current model of economic breakdown/capture has been the norm. - 1500: Date cited concerning the Ming Dynasty. - Around 1578: Approximate start date of the Ottoman Empire banning printing. - 1920s: Period when Argentina's wealth rivaled the US. - 1985 to 2001: Time span over which senator and congressional rep stock performance was studied. - Every six years: Cycle described for political turnover in Mexico. ## Examples & Cases - Watergate scandals: Cited as a factor in decreased public trust. - Trump and Sanders: Political candidates cited as examples on both sides of the aisle. - Louis XIV in France and the Bourbons: Examples of rulers who claimed supreme control over the state. - The Marcos family: Example of co-option in the Philippines. - Vladimir Putin's palace: Example of alleged wealth accumulation/co-option in Russia. - Otto III Trujillo: Example of extreme wealth accumulation in the Dominican Republic. - Mir Osman: Example of extreme wealth accumulation in British India. - China (Ming Dynasty): Example of a declining great power due to internal policy failures. - Ottoman Empire: Example of decline due to the Janissary corps and limiting power struggles. - Venice: Example of an empire whose decline is attributed to the Seriate Decree. - North Korea, Russia, Iran, Venezuela: Modern geopolitical examples of autocracy or instability. - Argentina: Example of a former great power that became a "basket case" due to internal co-opting. - Hong Kong/Cougars: Modern example cited regarding wealth concentration within the political party. - Senator from Georgia and her husband: Example of potential insider trading benefiting from inside knowledge. - Chris Collins: Example involving insider information and family benefit from public sector unions. - Derrick Chauvin: Officer cited in the George Floyd case as an example of potential malfeasance. - Waiting for Superman: Movie cited as an example illustrating the difficulty of firing underperforming public school teachers. ## Trade-offs & Alternatives - Autocracies (norm through the 1800s) vs. Democracies (norm nowadays): Contrast in governance models. - Welfare State (Concept) vs. Private Sector: Comparison in unionization rates (Public sector unions are on the rise, private sector declining). - Election Outcome: Choosing between electing "incredibly wise people" or having internal access to government information. - Government Structure: Choosing between cleaner forms of government (like democracies) and current reality. ## Counterarguments & Caveats - The US trust decline might be "probably reflective of the time" since the late 60s. - People on the supply side "can't do very noble things... they also have foibles like the rest of us." - The fact that current US polluters lose $4.5 billion annually doesn't motivate consumers to lobby for change because the individual loss ($50 for a family of four) is too small. - The founders of the US were right: "people aren't angels." - A competitive system does not mean integrity or trust in the government (e.g., Mexico, Italy). ## Methodology - Pew Research Center: Annual surveying of Americans on trust levels. - Study (Senator/Rep): Analysis covering 1985 to 2001 comparing stock portfolio performance. - Study (Comparison): Comparing autocracies and democracies over a two-year period (unspecified). ## References Cited - Pew Research Center: Source for annual trust surveys. - Karl Marx: Philosopher whose theories on capital capture were cited. - Friedrich Hölderlin: German romantic poet whose quote was used. - Milton Friedman: Person associated with a famous quote on government programs. - Transparency International: Organization that rates country transparency on a 0-100 scale. ## Conclusions & Recommendations - Need to set in motion safeguards. - Safeguards in general work. - Integrity is improving over time, especially in democracies. - Recommendation: Need to improve trust in the government, not just structural forms of government. ## Implications & Consequences - If the supply side is allowed to co-opt the system, it leads to decline (e.g., Ottoman Empire, Ming Dynasty). - If US trust is low, it implies systemic failures beyond simple governance structure. - If the US continues to limit sugar imports, the economic loss of $4.5 billion/year persists because of concentrated lobbying power. - If political power is the currency, it is very difficult to buy or remove a political leader/system compared to a corporation. - Democracies *outperform* autocracies but are "far from optimal." ## Open Questions - What is the path to achieving a perfect score of 100 in government transparency? - What safeguards are necessary to overcome the inherent lack of trust despite improving integrity? ## Verbatim Moments - "This topic certainly uh very topical." - "we can't count on the invisible hand to ensure efficiency in political markets" - "it's hard to write an iron-clad contract once you can get out of political power" - "People aren't angels." - "your generation you're wearing the red slippers like dorothy was"