The Politics of Poverty

Ideas and analysis from Oxfam America's policy experts

Oxfam agrees with Elizabeth Warren’s blueprint to “drain the swamp”

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From 2009-2015, the 50 biggest US companies got more than $423 billion in tax breaks and spent more than $2.5 billion on lobbying Congress to boost their bottom line even further. Illustration: Oxfam America

Senator Warren’s new bill roots out corruption keeping inequality so high in the US.

On August 21, Senator Elizabeth Warren presented a serious plan to weaken the influence corporations and lobbyists hold over American democracy, making her one of the only politicians to take the problem seriously. Warren’s sweeping proposals aim to make government more effective and accountable by weeding out the corruption that motivates it to serve elites.

Oxfam has argued for years now that the inequality crisis has been driven by mega-corporations and connected political elites capturing government. While Warren’s bill addresses this crisis in DC, the problem is global. Many low- and middle-income developing countries are plagued by elite capture. The consequences of such corruption include stunted economic growth, policies that enrich the few while leaving the rest behind, and massive inefficiencies in how government operates.

Given the global scale of the problem, this bill presents a unique opportunity for the US to lead in the fight to rescue democracy. This sort of leadership is especially necessary at a time when democracy is in peril.

This bill excites me for a number of reasons. The proposals rest on strong analysis and evidence drawn specifically from DC’s corruption woes. The bill is also very comprehensive. It aims to “end lobbying as we know it,” and block industry groups from weakening rules protecting the public through “sham” research. It would also reduce corruption among judges, raise transparency requirements, and create a public ethics czar to enforce the law.  Here’s a summary of the bill.

The positives

Warren’s bill contains a provision to raise salaries among Congressional staff so they’re competitive with other federal jobs. Staff members engage with constituents and lobbyists alike and are the brain trust Congress relies upon to make sound legislative choices. Unfortunately, low salaries mean staffers often treat interactions with high-powered lobbyists as job interviews. It also makes them more likely to support industry’s positions over the public interest. Raising Congressional staff salaries is therefore crucial to both increasing Congress’s integrity and incentivizing staffers to remain in Congress, where their expertise can serve Americans for years to come.

The bill also takes direct aim at eliminating financial conflicts of interest among government officials. Trump’s first Health and Human Services Secretary, Tom Price, who introduced legislation delaying Medicare/Medicaid regulations that would hurt the price of a biotech stock he purchased a week earlier, comes to mind. Overall, the reforms would make it harder for government officials to use their positions for personal gain—think Trump’s insistence that foreign dignitaries stay at Trump International Hotel on Pennsylvania Avenue.

Lastly, the bill introduces a much-needed overhaul of the rules-making process between regulators and industry. Unfortunately, the norm in Washington is for industry lobbyists to submit what Warren calls “sham research” in support of repealing rules to protect consumers, the environment, and public health. Currently, we’re watching the EPA eviscerate such pubic interest protections by ignoring high-quality science and peer review analyses on climate change. Warren’s bill introduces commonsense standards for what passes as research.

What concerns me

The very entrenched forces Warren’s bill aims to eliminate will make sure this bill doesn’t see the light of day. The status quo is killing our democracy, and making life worse for Americans. Yet, it’s been great for big business and the wealthy.

As we’ve been documenting, the last 40 years witnessed the US ossifying into a society of winners and losers between the richest 1 percent and everyone else. The bottom 99 percent has watched wages stagnant, schools deteriorate, health costs soar, and the American Dream move farther out of focus.

Conversely, things have been quite cheery for the wealthiest. The Trump/Republican tax law ushered in lower taxes on the rich, while raising them on working people. And though the loopholes permitting mega-corporations to dodge billions in taxes were already massive, the new law both slashed the corporate tax rate, and made it even easier for them to avoid paying tax altogether by stashing profits overseas.

All of these outcomes stem from an uneven playing field that undercuts our democracy and makes the US seem more like an oligarchy. What’s scary is that the power of big business seems to grow stronger in DC, as the interests of the country continue to fade further in the background.

Gaining traction on Warren’s reforms requires nationwide awareness, activism, and public pressure. Similar to how President Obama created a wellspring of support outside of DC to overhaul healthcare, Warren and her allies need to hit the road and urge voters to make these issues a part of the dialogue for the midterm elections.

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