“We should not oppose offshoring or outsourcing,”proclaimed a well-known economist at the 2011 World Business Process Outsourcing/Information Technology Outsourcing (BPO/ITO) Forum. Hundreds of corporate executives sat in on this economist’s lecture, including representatives from Morgan Stanley, JPMorgan, Deustche Bank, Pfizer, Coca Cola and other major businesses. The economist went on to proclaim that critics of outsourcing were like “Luddites who took axes to machinery early in England’s industrial revolution.” This economist was not a Heritage Foundation scholar or Ayn Rand Institute fellow. The speaker that June was none other than Lawrence Summers, who had just finished up his role as director of the White House National Economic Council, where he was President Obama’s top economic adviser. This practice of giving private paid speeches to big corporations was nothing new for Summers. Before joining the Obama administration, he received hundreds of thousands of dollars in speaking fees from financial institutions that the White House was involved in bailing out and then shielding from more intense regulation. For Summers, the speech at the outsourcing conference was simply a relapse. All of this is particularly relevant now that Summers is being vetted as a possible chairman of the Federal Reserve, the most important economic post in the world. If Summers is still taking big payments to speak favorably towards the world’s biggest corporations, Americans and their representatives in Congress should know about it. But Summers is under no legal requirement to disclose his most recent payments from corporations until he is officially nominated, and if he’s nominated, he’ll most likely be confirmed. No Federal Reserve nominee has ever been defeated, with Ben Bernanke coming the closest when 30 senators voted against confirming him for a second term. Summers is not the only possible nominee with corporate conflicts of interest. Another name being floated is former Treasury Secretary Tim Geithner. Geithner, too, has used his time out of government to enrich himself, at least partly from corporate largesse. This isn’t to say that Geithner and Summers will necessarily do the bidding of outsourcers or mega-banks. Both men have a history of center-right policy advocacy, and it’s likely that they’re simply ideologically aligned with corporate America. But their habit of floating in and out of government while taking in six-figure payments from large corporations gives them a powerful incentive to continue to line up their beliefs with those of their benefactors. As Upton Sinclair famously wrote, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”
Posted on: Tue, 06 Aug 2013 23:45:27 +0000
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