Tuesday, Mar 22, 2011, 9:36 AM

Citizens United and the Political “Ice-Nine” Effect

032211_Sup Ct.jpgIf a parallel-universe Alexis de Tocqueville were to write a bizarro version of the Frenchman’s magnum opus today—say, How to Ruin Democracy in America—he’d have to give the Citizens United ruling a prominent role in his narrative. The circumvented balance of power, the capture of public policy by special interests, the sheer volume of money warping policy: These anti-democratic effects are well-trod ground, justifiably so. Transferring so much power to what can only be called an oligarchy subverts the most deeply held tenets of democracy.

Still, even these melancholy musings may not capture the most serious derangement wrought by this open Pandora’s Box. Even more disturbing than the ruling’s concentration of power in corporate and special interests is the positive feedback loop it creates. The least scrupulous and most willing to subvert public-private firewalls to reap the benefits of crony capitalism will benefit the most from transfers of public wealth, which they can then leverage to accumulate still further power.

Unlike their inherently self-regulating negative cousins, positive feedback loops are not so easily tamed. In the popular consciousness, the most familiar example is probably Kurt Vonnegut’s fictional “ice-nine” in Cat’s Cradle: a variant of ice with altered melting point, prompting it to progressively convert garden-variety ice into the altered form, eventually freezing the oceans. Nevertheless, the ice-nine phenomenon is not confined merely to the fervent imaginings of decorated novelists. An unsettling real-world example is the curious case of Mad Cow disease and CJD, its human equivalent; both represent devastating neurological conditions ensuing from the autocatalytic effect of a so-called prion, a non-functional “evil twin” of a normal brain protein. When the evil twin interfaces with the healthy form, it serially begets more of itself, further accelerating the noxious conversion, and on and on.

The ice-nine phenomenon has equally hideous manifestations in the context of macroscopic social, economic, and political spheres. The common feature is a perverse incentive, conferring a potent short-term selective pressure toward behavior that is long-term disastrous; the toxic stimulus thus serially begets and empowers itself. The dreadful race-to-the-bottom scenario in classical economics is Exhibit A: Repugnant workplace practices (abusive child labor, unsafe worksites, environmental contamination, indentured servitude, even outright slavery) nonetheless confer a competitive short-term cost advantage for outfits that allow them, pressuring other enterprises toward the same regressive practices. As with the evil-twin protein in Mad Cow disease, the disastrous chain reaction is autocatalytic: It takes only a few rotten apples at the outset to seed catastrophe, spoiling the entire barrel.

That’s what Citizens United has engendered: a “political ice-nine” phenomenon in which power and wealth progressively accrue to the sociopathic interests most detrimental to society. Even if only five percent of firms were to use their (now unrestricted) contributions to sway policy and secure no-bid contracts, tax breaks, and diminishing regulations, that less-than-upright subset now becomes “selected for” in the new scramble for power, as do the politicians unscrupulous enough to go along with the corruption. As the spoils accrue to the least principled in one cycle, they gain leverage to extract still more spoils in the next cycle, and onward and onward. Dirty profits, grabbed from the public purse, thus serially beget themselves in a spreading and self-amplifying disaster.

It takes little imagination to appreciate the calamitous logical endpoint of this process. The Treasury, already in a precarious state, would be looted—as presaged by attempts to acquire public utilities on the cheap in Wisconsin, noted recently by Paul Krugman. In disempowering the majority of those firms and policy-makers who accept the necessary distance between private sector and public watchdog, the Court has all but hung up an “all-you-can-plunder” sign before the now-open safe housing the country’s publicly-held assets.

More subtle but just as dangerous, Citizens United would provoke such a patent misallocation of tax dollars as to cripple the public trust and unity on which any nation depends. Many high-tax, low-corruption societies—notably Germany and the Scandinavian and Benelux countries—nonetheless enjoy robust capitalistic economies and high public trust, since their citizens can plainly see the wealth-generating, added-value investments (infrastructure, education, basic science research, the arts, etc.) to which public funds are applied. In stark contrast, if the U.S. public witnesses its hard-earned tax dollars skimmed off from the cronyism facilitated by Citizens United, it will be well-nigh impossible for the citizenry to come together for the shared sacrifice needed as we shift to a more mature, low-resource economy dependent on human capital.

The political ice-nine effect means that the consequences of Citizens United are even more atrocious than you’ve probably heard already—not just an aggressive plutocracy (as brilliantly rendered by Jacob S. Hacker and Paul Pierson in Winner-Take-All Politics), but a full-on fiscal train wreck, Naomi Klein’s Shock Doctrine on North American speed. This is the twenty-first-century realization of Plato’s ancient warnings about the fragility of democracy, and Hegel’s eerie observation that history occasionally lurches from its staid, gradualistic path into wild and sudden breakdowns of an existing order (aka “total system failure”). The near unanimity of opposition to Citizens United in every poll, across party lines, shows that the American people are onto this, too. But the decision needs to be countered at once, because it becomes far more difficult to change the longer its effects accumulate. Barring unexpected retirements in the near term, the most immediate hope is that the current Court itself might see its error; its decisions have been fairly reasonable in many other domains (nothing like the ideological rigidity of the Taney Court), so perhaps its members will revisit their decision. If not, then we already have the framework for the Twenty-Eighth Amendment.

J. Wes Ulm wrote “Cachet of the Cutthroat” in our Spring 2010 issue.

Photo credit: deltaMike


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Gary Larsen:

Your comparison of the Citizens United Decision to Vonnegut's ice nine effect involves likening it to a fictional fantasy, and then treating the fantasy as if it were a reality. You present no evidence that the Decision will cause the dire effects you refer to. There are a lot of other causes of the kind of problems you describe, such as judicial supremacy and an unrepresentative Senate that can block the will of the representative majority of the House. Perhaps the most relevant cause is the lack of a strong party system where the parties can control the influence of their donors. We, non-Republicans, are afraid of the Republicans as if they were monsters controlled by Wall Street, with no champion to fight the monsters. Where are the Democrats in all this? As Hacker and Pierson note, they betray us because they do not have the organization and discipline of the Republicans, not because of how they are financed.

Mar 23, 2011, 2:20 PM
Seth Morris:

@Gary Larsen,

Whoa, I think you completely missed the point of that post, I gathered the editors actually are agreeing w/ you concerns. They weren't likening Citizens United to a fictional fantasy, they're using a familiar tale like Cats Cradle to illustrate positive feedback loop concept, how dangerous it is, then showing the real-life cases that involve the same concept. I had to read Vonnegut recently and that's exactly what he was talking about, one dangerous factor propagating itself worse and worse. The post was saying that's what Citizens United is opening the door to, if the Kochs can give unrestricted campaign money to control politicians like Scott Walker, they and other's like them can make a profit by getting control of Wisconsin utilities at cut-rate price, then use those profits to buy more governors, get more public utilities, etc. until the states and Feds go broke. So there's already real-world evidence for that, in fact I gather they're saying that's how corruption spreads in banana republics and now we're at risk for same thing, which sounds accurate and really scary.
The other points you bring up also relevant, especially unrepresentative Senate and I guess filibuster, and Dem's lack of organization, but why do you think this excludes the damage caused by stupid campaign finance system in the U.S. after Citizens United, you think they are mutually exclusive? Don't you think that opening door to unrestricted campaign money, also gives way to much power to a corrupt wealthy donor with anti-democratic interests? All that money pouring into campaigns like Scott Walker, that was a major reason for the 'shellacing' in 2010 not just poor organization by their opponents. In fact I gather that un-controlled campaign money is the most dangerous threat to democracy like ours and causes many other problems, how do you think we could reform Senate if the Kochs dollars are supporting corrupt reactionaries who use it's unrepresentative rules and filibuster to advantage? Until campaign finance is changed it's hard to change anything else, too many powerful and corrupt donors able to take advantage of it. It seems like your making a needless argument here when we all really agree on the basic problems.

Mar 24, 2011, 7:14 PM

I'd also like to think that the Court might at one point take another look at the powderkeg they've just lit underneath the country's democratic system. I'm a legal eagle myself, and after reading Justice Kennedy's majority opinion -- search for Citizens United v. Federal Election Commission in the document archives at any law school -- I'm unfortunately even more convinced that the Court has no intention of correcting this fiasco. There are certainly some ideologues among the nine of them, but there's enough room in the middle that the Court can't really be said to be an out-and-out captive of ideology, let alone they were "bought off" or the other cynical accusations. It's just that the 5-4 majority got so tied up within their faulty logic that they overlooked the broader picture, not to mention the real world of flawed laws and politics in which the decision will exert it's effect. So it's not "another Dred Scott" in terms of the ideological extremes as many have accused the 5-4 majority, however it may be just as damaging in the short and long run in it's practical effects, something that the majority in that ruling don't seem capable of realizing. It's the type of self-deceiving, confused legal reasoning that sounds fine if you stick to any given sentence or passage, but falls apart the more you see the forest for the trees -- even before you consider the awful impact it has in a practical context.

Mar 26, 2011, 9:24 PM

Gary, I was pounding the pavement myself in the precincts in Nov. of 2010, so no quibbles from me about the woeful lack of ground-game organizing -- but AFAIK this article is getting at a far more fundamental issue than the two-party political maneuvering of the moment. It's more about the indispensable traits that make a 1st-world democracy as opposed to a 3rd-world failed state. How the 1st-worlders have careful structures to avoid the positive feedback loops that concentrate wealth from the community into the hands of a powerful few. While the 3rd-world states lack these safeguards, so that the least savory and most selfish elites can help themselves to the community's wealth at the expense of everyone else. If you need evidence for this, all you have to do is open your eyes, and it's not just in the government-by-corruption that you see in the failed states overseas. Watch "Inside Job" sometime, and see how the elites were able to manipulate policy in the financial crisis of 2008 to profit at public expense -- the worst kind of privatizing gains and socializing losses -- and then, even after they'd made billions of profits while everyone else was suffering, to hoard billions of badly needed dollars away from the broader economy. If elections and policy debates are then open to uncontrolled floods of money, then there's virtually no counter-balancing power to stop this from happening again, and the very fact that those elites gained so much from the prior crisis gives them even more power to push policy the next time around.

I worked in several NGO's abroad right after college, and that political icenine is precisely what defines the economy and political practices in those places and why they're such a chronic mess. I hadn't considered that analogy before, but it seems like a reasonably elegant first stab at a uniting principle to describe how power can aggressively concentrate itself in the wrong hands even in an otherwise functional system. It's not that "everyone in power is corrupt" as the complaint often goes, in fact the vast majority of officials we encountered in even the poorest countries were decent people just trying to do their jobs. Nor, are most corporations corrupt and unscrupulous, most try to be good citizens and make useful products to grow an economy. I was a partner in a mid-sized business myself in the 1990's that provided a valuable product and added jobs while following the rules, I'd like to think that we were contributing tangibly to the country and the article seems to agree that most businesses are like that. So the question is, if most officials and companies are decent and contribute to a country, how can a small majority that's less scrupulous gain much more power and do so much damage? It looks like that's what the article is trying to highlight -- if you form incentives that give power to the less scrupulous, they'll be the ones to get power, they'll damage things for everyone else, and they'll be the ones you notice even if the vast majority of people and companies aren't like that. Even if a small minority of them are corrupt, that select few can mess things up for everybody else.

Productive capitalism and innovation benefits a country, cronyist capitalism does the opposite, and you have to distinguish between the two -- that's what Inside Job was honing in on, it's director AFAIK was a successful entrepreneur himself. But he knew the difference between the types of businesses that add something of value and the ones that just skim off everyone else, and you don't ever want to give power to the second group or they'll bleed a country dry. That's what I saw in the countries I worked in, and it's why so many of our aid projects failed from eventual corruption. The least scrupulous minority of officials were the ones who got the richest by pulling strings with their connections in high office. So their ill-gotten wealth gave them increased power which allowed them to buy still more favors higher up, which then got them even more wealth and thus more power to corrupt the system. Those countries unfortunately had no protections against this conflict-of-interest, so even though 99% of the public servants may have been up-standing citizens, the more corrupt 1% were the group that increasingly got more and more power, skimming off increasing amounts of wealth and then using that to acquire still more wealth at community expense. That's the fiasco feedback loop that the article is referring to, and Citizens United v. Federal Election Commission has brought us dangerously close to that vicious cycle here. A first-world democracy has to have tough checks-and-balances against that kind of thing, and allowing policy to go to the highest bidder is a major step in subverting the protections that you absolutely must have.

Mar 26, 2011, 10:11 PM
Gary Larsen:

Than you, Seth and BenandStacy for your comments in response to my comment.

I don't think I missed the point of Ulm's remarks-I just disagree with his focus on campaign finance as the source of the problem. For me, on the list of the problems of our American political system, campaign finance is pretty far down. There are more significant problems that need to be addressed first.

The Citizens United decisions has not lit the fuse to a deluge of money and influence swamping the political process. Such statements are naive: the deluge of money did not start yesterday or last year. It is not even clear that the Citizens United decision will change anything.

I am not against regulation. It is just that the ways in which reformers have been trying to regulate campaign finance for the last 100 years have not worked. They have in effect been beating their fists against a wall, unable to stop and think that it may be necessary to try something different. My suggestions are quite different from the direction taken to date. I refer the reader to another blog I wrote at Daily Kos as gylarsen on campaign finance, and more broadly to my ebook, which can be found at Amazon.com.

Mar 27, 2011, 12:00 PM
Old Badger:


I'm interested to read your diaries on this topic, if nothing else because you're the first person I've seen to stick your neck out like this and talk down the impact of Citizens United. Although this Blog certainly takes a fresh look at its harm to democracy, it's not unique in its denunciation of the ruling, in fact this seems like something of a universal consensus as far as I can tell. I have coworkers and friends who are hard-core right-wing on one side, others with Che bumper-stickers on the other side, yet they and just about everyone in-between still agrees that Citizens United is a perfect disaster. Thing is, the ruling isn't just broadly unpopular but also logically flawed, as I hear the same criticisms from even the people I trust most to give a forthright assessment about these things: they're cold analytical, apolitical types without an ideological bias to begin with. I bring this up not to throw stones at your argument from the outset, if anything I'm intrigued by how you've argued against such a powerful consensus criticizing Citizens United.

Mar 29, 2011, 8:21 PM
Old Badger:


Just read some of your posted diaries. You make some interesting new arguments, though IMHO more in addition to the chorus of criticism of Citizens United than in mitigation of it. I'm certainly among those people I spoke of previously, coming in with a very negative view of the ruling and I'll just lay out why here. It’s the perceptions and disgust of people like me, not too political to begin with but protective of our democracy and skeptical of special interests, that is driving the harsh criticism of the ruling from many corners. Cynical-leaning independent voters like me in particular have a sensitive nose and react harshly to corruption wherever it shows up, in the private or public sector, and the privileged interests free-for-all allowed by Cit United has the stench of corruption and conflict-of-interest all over it.

1st it seems to me the ruling has already been having a serious and negative impact, I just don't see how that can be denied. You say that Citizens United hasn't lit the fuse for a deluge of money and influence on elections, but IIRC the 2010 mid-terms set an absurd new record for the amount of money pumped into the electoral process, most of the increase in those 501c's. I have read that Cit United still leaves the old contribution limits in place, but that doesn't matter much anymore, Cit United has made those limits irrelevant in actual practice by opening up un-restricted flows for the 501c's. And I do recall that there was a flood of money pouring into the last week of campaigning that affected the races for both parties, made even worse by the lack of transparency and the hints of political favors. Keep in mind this is still happening, in Virginia right now there are vicious, IMHO frankly defamatory ads being launched against elected officials trying to do even basic, common-sensical regulations to stop corruption, obviously put up there by those same corrupt financial interests and their 501c's that would stand to gain financially from gutting the regulations.

I wasn’t aware of that Paul Krugman article before, but those of us with Wisconsin roots were already well-aware of the documented machinations against our state. Wisconsin's always been well-managed with a lot of value held in public trust, unsurprising that some have seen that as a target. It's well-known that Scottie Walker got millions in Koch money to win the Wisconsin statehouse courtesy of the un-restricted 501c rules after Citizens United, which was conveniently followed by a bill to privatize the state's wealth in un-negotiable contracts open to out-of-state interests. In fact the union-busting looks like just a smoke-screen for the real pillaging done by the lesser-known bill that Krugman exposed, and Walker's embarrassing boot-licking towards that prank-caller posing as Koch, even after he'd refused to take calls from anyone else, just reinforces that Walker and his cronies were specifically shipped into power as thieves in the night, with express instructions to asset-strip Wisconsin for those private interests. The Koch family are from Kansas IIRC, how does it make sense for Kansas billionaires to get control of state assets in Wisconsin, what ‘value’ does this add as a business transaction or as a benefit for the state’s citizens? Nothing whatsoever, it’s simple predation, almost like a hostile act-of-war against a state. Same thing in Indiana and Ohio. And it's not a partisan thing, Wisconsinites are Wisconsinites first and foremost and would react just as angrily to this corruption from either party: I visited friends in Wisconsin recently and even lifelong GOP members there are supporting the recall effort against Walker and his pals, because they're crooks whatever party they claim loyalty to.

It's all the more outraging for Wisconsinites because Wisconsin is not Greece, it's not a fiscally irresponsible entity that's brought problems upon itself but a very well-managed, community-oriented and entrepreneurial state that's clearly been targeted with a manufactured fiscal crisis and greedy interests from outside Wisconsin, who want to take advantage of the crisis to steal away the state's hard-earned wealth. Wisconsinites are rightfully known for their friendliness, but woe to anyone who betrays their trust and tries to take advantage of them, because that friendliness will turn to a rage that will swarm the offender. That's what's happening to Walker and all his cronies who put him up to pillaging Wisconsin. But it doesn't matter and the crooks know it: it takes a long time to get the recalls up and moving, and by the time Walker and the other crooks are tossed out, it'll be too late. Wisconsin will have been asset-stripped by Koch and like minded vultures looking to get their greedy hands on the state's stores of value, taking at the expense of the people and contributing nothing in return. Once that damage is done it can't be undone, legal ownership is already transferred and they're that much richer to repeat their depradations elsewhere.

I'm glad to see that the author has avoided the usual "corporations are evil" rhetoric that so often comes up in talking about Citizens United, he's taken a more nuanced, non-partisan tack here that AFAIK is based on what they pound in on Day One in poli sci and econ class: the behavior of a system isn’t necessarily reflective of the individuals that make it up and on a mass-scale, the incentives you introduce invite the behavior you get. That’s why places and systems that are full of otherwise good people can still have predatory behavior, because if a system rewards that, the few bad actors among them will reap the benefits and drive everyone else to do the same thing. So Citizens United perversely rewards the devious and corrupted minority at expense of the solid rank-and-file.

Gary, I also wouldn’t say that you’ve missed the point in and of itself, I just think the vibe among people here is that your argument is more complimentary to the anger at the ruling than opposed to it. I’ll be brutally honest with you, trying to downplay Citizens United is a Sisyphan task and you won’t convince 1 out of 100 people who read your diaries, but your arguments make some sense if you present them as adding to the critical consensus about Cit United instead of considering them a foil. I like what Ulm has done here, looks like he’s put on a John Locke hat and really gotten down to brass tacks about the deeper mechanisms that make or break a viable country. If nothing else I’ll be brushing up on my Tocqueville and Hegel a little, although I never really got Hegel to begin with. That being said, I think your ideas also contribute to the discussion, at least to make us think about other factors effecting the campaign-finance landscape in the US. Great food for thought here.

Mar 31, 2011, 1:33 PM

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