Given the way Washington has run away with itself, it’s no surprise that “crony capitalism” has risen to the top of the agenda for some politicians on the political left as well as the political right.
The federal government has become a virtual one-stop shop for corporations more interested in gaming the system and capturing regulations than they are in making a clean profit and an honest living.
That harsh realization shouldn’t distract us from the lesser – but hardly minor – corruption that plays out every day at the state level. Unfortunately, California is no exception. All the news media need do is cast their net to pull in fish.
The good news is, at least state and national reporters are beginning to do the work. As the San Francisco Chronicle reports, for instance, the California Institute for Regenerative Medicine has taken inside dealing and big-ticket back-scratching to a new level. This obscure agency was actually voted into existence back in 2004.
Although its official function is to spend $3 billion of taxpayer funds on cutting-edge stem cell research for complex injuries and diseases, CIRM has also operated as a cash cow for a tiny circle of well-connected individuals and institutions.
The Chronicle singles out Dr. Alan Trounson, the former president of CIRM, for swiftly joining the board of directors of StemCells Inc., a beneficiary of $19 million in CIRM funding.
One of StemCells’ founders, Dr. Irving Weissman, is based out of Stanford University, which has raked in almost $300 million from CIRM.
Notably, these stem-cell shenanigans have provoked the ire of activists and journalists – from the progressive-leaning Consumer Watchdog to the conservative-heavy National Review.
An even easier story for California reporters to cover, sadly, is the corruption on display at CalPERS. Federico Buenrostro, the former chief of the public pension fund – America’s largest – pleaded guilty to selling his influence for some quarter-million dollars in bribes and gifts.
As the Los Angeles Times reports, “Buenrostro’s plea agreement also acknowledged that he defrauded state and local government workers and pensioners, as well as taxpayers in general, of their right to honest services by ‘attempting to defeat and obstruct’ federal securities regulation.”
CalPERS, of course, has condemned Buenrostro’s acts and announced “aggressive” new anti-fraud measures.
Reactive acts of damage control, however, aren’t enough to address the wave of corruption flowing from the close state and national “partnership” between big business and big government. That relationship has defined the current U.S. economy – before, during and after the economic crisis that almost unleashed a worldwide depression.
In Washington, D.C., the bipartisan movement to break up cozy cronyism is still working to build momentum. Similar efforts at the state level are essential to helping officials inside the Beltway understand that the time for change has come.
Californians have an opportunity to lead; they should take it.
