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Robert Reich

Robert Reich

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Why We Need to Rein in Government Contractors That Use Taxpayer Money for Political Advantage

Posted: 05/20/11 09:32 AM ET

President Obama is mulling an executive order to force big government contractors to disclose details of their political spending. Big businesses are already telling their political patrons in Congress to oppose it -- and the pressure is building.

The president should issue the executive order immediately. And he should go even further by banning all political activity by companies receiving more than half their revenues from the U.S. government.

Lockheed Martin, the nation's largest contractor, has already got more than $19 billion in federal contracts so far this year. But we know very little about Lockheed Martin's political spending other than its Political Action Committee contributions. We don't know how much money it gives to the Aerospace Industries Association to lobby for a bigger defense budget.

We don't even know how much Lockheed is giving the U.S. Chamber of Commerce to lobby against Obama's proposed executive order requiring disclosure of its political activities.

Don't we have a right to know? After all, you and I and other taxpayers are Lockheed's biggest customer. As such, we're financing some of its lobbying and political activities.

Lockheed's lobbying and political activities are built into its cost structure. So when Lockheed contracts with the federal government for a piece of military equipment, you and I end up paying for a portion of its political costs.

It's one of the most insidious conflicts of interest in American politics.

Now, in the wake of the grotesque Supreme Court decision, Citizens United vs. the Federal Election Commission, there's no limit on what Lockheed can spend on politics.

That's why the president should go the next step and ban Lockheed and all other government contractors that get more than half their revenues from government from engaging in any political activities at all.

Otherwise, you and I and other taxpayers indirectly pay for Lockheed and Northrop Grumman to lobby for a larger military budget and support politicians who will vote for it.

We indirectly pay for Blackwater to lobby for -- and support politicians who will demand -- more use of contract workers in Iraq and Afghanistan.

We indirectly pay for Raytheon and General Dynamics to lobby for, and support politicians who will push for, more high-tech weapons systems.

And so on.

Disclosure is a start. But in this post-Citizens United world, it's only a beginning of what's needed.


Robert Reich is the author of Aftershock: The Next Economy and America's Future, now in bookstores. This post originally appeared at RobertReich.org.

 
 
 

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HUFFPOST SUPER USER
jkooba
myliberalbias_blogspot
01:39 PM on 05/26/2011
I work for a government contractor and I fully agree that they should disclose their political spending.
08:05 PM on 05/24/2011
Does this mean people who get most of their money from the taxpayers should not be allowed to vote? (John Stuart Mill endorsed this.)
03:23 PM on 05/24/2011
The elephant in the room that is currently a taboo “no no” in the deficit debate is the fact that the country is immensely rich, if only one would take into account the net worth of the top 1% of the population. The top 1% of the country comprises 40% of the national wealth or about $20 trillion dollars, which under currently adopted rules of the national debate is considered off limits and untouchable, e,g, untaxable, as a means to solve the government deficit problem. A 7% tax surcharge on this billionaire property wealth would handily and simply wipe out the $1.4 trillion annual Federal deficit. If half the $20 trillion in the hands of the top 1% were now going forward under enlightened sufficiently aggressive tax policies devoted to now reducing the national debt by $10 trillion to 1/3rd of GDP, the poor top 1% would be reduced to at most in a zero sum world an average net worth of only $3.3 million as compared to $6.7 currently. Is that too much to ask those who enjoy the most benefit in America to contribute to preserve the health, safety, and minimal financial security needed by the other 99% of average Americans? This not a class warfare question? This is a practical question to save financially 99% of all Americans and preserve the United States AAA credit rating after years of improvident tax policy. Well, let’s discuss the REAL deficit math for once!
11:59 AM on 05/24/2011
One thing you didn't mention are the public sector unions giving money to the Democrats...
Such as the teachers union..
If you think companies like Lockheed shouldn't be allowed to use public sector money to back politicians then why should public sector unions be allowed to?

My suspicions tell me it's because you LIKE the party that the public sector unions back so it's all A-OK...

Interesting.....
08:06 PM on 05/25/2011
My suspicion tells me that you bring up this ridiculous comparison because you LIKE the party that takes bribes from these government contractors, so it's all A-OK...

Those unions are all composed of individual citizens who only have power in collective. The corporations do not have a right to vote and they are obligated by the rules of capitalism to rape the government for as much as they can get away with. So yes, they could use some more regulation or oversight
01:13 PM on 05/26/2011
Please explain who exactly they are unionized against?

Public sector unions are unionized against us the tax payer and I don't think that is one bit fair...

Who speaks for us in all of their collective power?

No one......
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HUFFPOST SUPER USER
Luanne Taylor
be an OTHER
09:50 PM on 05/22/2011
yes Robert Reich, I am with you! Citizens United MUST be reversed and I don't know why we should limit the disclosure to Big Business that does over half, I would say any Corp that applies for Government contracts, big or small MUST submit their political contribution history as part of the bid....and do it NOW before they slip in any tricks. Speed is the key! I'm going to check candidates in 2012 and see who uses the Presidential Election Fund and that is who I will vote for, that does include our current President who said he was going to use it in 2008, but I do NOT think he did...

Also, there was a great bill to withdraw Non Profit status for any group that donates to and/or promotes a political agenda, I hope that happens too.
Single Payer healthcare NOW, public funded campaigns NOW...now now now is my new favorite word.
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HUFFPOST SUPER USER
mauibob
I am a recovering Liberal. I apologize for my past
09:44 PM on 05/22/2011
Add the unions and im all for it.
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HUFFPOST PUNDIT
Dangerous Dan
Because I can!
04:35 PM on 05/22/2011
But government UNIONS that get 100% 0f their income from the government can spend all they want to, right!
06:47 PM on 05/22/2011
Nice try, but it's not the same.

The Unions get all their money from their members, who may or may not get their salaries from the government.

Corporations take the money from their shareholders to use it to lobby, many times against the wishes and desires of those shareholders.
12:02 PM on 05/24/2011
Nice try but you are wrong...
Public sector unions get their money from their union members who get their money from us the tax payer....
Either from property tax, state taxes or income tax from the IRS.
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HUFFPOST SUPER USER
Paperless Tiger
04:15 PM on 05/22/2011
So we pay the lobbies to pay our politicians to pay more to the lobbies? Aren't we clever? Gee, I wonder why we're suffering from ruinous debt.
02:12 PM on 05/22/2011
Reich is totally right ... this is just a positive feedback loop for a military industrial state! This development is urgent and long-past due.
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parlimentMike
Terrorists keep you in fear
01:22 PM on 05/22/2011
Who is going to rein in political contributors? Noah found more just men than you'll find in this Congress.
01:12 PM on 05/22/2011
The entire electorial system is corrupted by lobbyist, special interest and unions. Why do we even dare to call this "FRRE ELECTIONS" ? The election process is anything but FREE and the results no longer represents the good of the people. There will never be any real reform to the current election system until the people stop compaign contributions of all kind. Not one presidential, senate, congressional, etc... candidate will allow this to happen. How does it feel to be powerless in the land of the free?
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HUFFPOST SUPER USER
Skeptical Patriot
12:48 PM on 05/22/2011
Robert, I couldn't agree more. Further, any gov't service union (state or federal) including the teachers union and any government service union should have the same obligation. Frankly, any entity that receives the bulk of compensation from the federal or state gov't should be prohibited from lobbying.
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HUFFPOST SUPER USER
CPAwADD
Always look on the bright side of life.
12:19 PM on 05/22/2011
All publicly held companies should be required to disclose their political donations as part of their annual report filings.
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parlimentMike
Terrorists keep you in fear
01:26 PM on 05/22/2011
All officers of any corporation, public or not should have to disclose. Corporations are government creations, We the People, grant their permission to be, We can dictate the rules that suit us. Until We act like we're in charge, our power, like Obama's is useless to the People's interests.
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RedLeg2
Liberal Soldier Extraordinaire, 13B 88N 42R
12:15 PM on 05/22/2011
While deployed (each time) I noticed the numbers of contractors. My food was prepared by a contractor (the army has cooks). My laundry was done by a contractor (the army has quartermasters). The internal security was provided by contractors (any private can stand a watch or guard a post). Now here is the kicker. The contractors were foreign nationals employed by American companies with high paid white (usually) Americans. American contractors are engaging in a form of indentured servitude and the Americans are making a fortune, while paying their Indian, Nepalese, Burmese, Nigerian, and Ugandan employees chump change. Gotta love capitalism.
02:15 PM on 05/22/2011
I think the natural development of this trend is going to be the creation of private corporate armies that can threaten states, including the US if we allow ourselves to get poor and weak enough.
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RedLeg2
Liberal Soldier Extraordinaire, 13B 88N 42R
06:14 PM on 05/22/2011
british east india company all over again
06:49 PM on 05/22/2011
What do you think Halliburton and Xe (formerly Blackwater) are?
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HUFFPOST SUPER USER
Luanne Taylor
be an OTHER
09:54 PM on 05/22/2011
hope you have seen "why we fight"... you'll like it...and I am so glad you are home safe and sound.
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HST
Conservatism = selfishness
12:15 PM on 05/22/2011
Republicans in Congress won't even look at this type of stuff. Too busy cutting programs that help people and defending rich corporate subsidies.