Those Recycled Petro-Dollars

The other day, there were several articles about a McCain campaign worker resigning because he and his firm had made $15 million in lobbying fees from Saudi Arabia. Senator McCain has now lost several campaign workers over this issue of lobbyists.

Perhaps, we are all getting a little too paranoid about this lobbying business. For all we know, this former Texas Congressman turned lobbyist was trying to get a traveling company to perform Fiddler On The Roof throughout the Kingdom of Saudi Arabia for the Ministry of Culture and Diversity. We should not jump to conclusions and right away assume that the lobbying had some sinister purpose.

Saudi Arabia does have one of the worst human rights records and that fact may require the services of a lobbyist. The textbooks in the schools in Saudi Arabia teach their children that Jewish people are monkeys and pigs. What they teach them about Christians is not much better. So, with regards to education, the Kingdom can use some help from an experienced lobbyist.

Also, let us not forget that 15 of the 19 men involved in 9-11 (2001) were from Saudi Arabia. And, after 9-11, the United States let a plane load of Saudi nationals fly back to Saudi Arabia without even letting the FBI question them as to their knowledge or involvement in the execution, planning or financing of 9-11. This kind of freedom and mobility almost always requires a certain amount of lobbying. So, while specific work is not apparent, work behind the scenes is no doubt being pursued.

On the other hand, Saudi Arabia is a great trading partner for the United States, and we would not want to do anything to damage that relationship. Saudi Arabia sells us oil and we send them money. Unfortunately, we do not make anything, except military hardware, that the Saudis want to buy from us. The problem, from an economic standpoint, for the Kingdom of Saudi Arabia is how to recycle petrodollars back into the United States. This is accomplished by a process known as recycling petrodollars through K Street. In Washington, D.C. there is a street known as K Street. K Street is the place where the lobbying firms hang their hats and lobby members of our government.

Once the Saudis hire a lobbyist, the recycled petrodollars start to roll-in. But, this is only part of the process. After the recycled petrodollars roll-in in the form of lobbying contracts, the lobbyist make campaign contributions or work for free for people that campaign for elective office like the presidency. Which gets us back to where this story first started, a member of Senator McCain’s campaign staff working for Senator McCain’s campaign for the presidency for free. How can anyone afford to work for free?

Well, if you have received $15 million from Saudi Arabia plus other clients for services as a lobbyist, then you can afford to work for free.

How much money do you think the Kingdom of Saudi Arabia has spent on lobbyists since 1973? Since 9-11-2001? Where do all those recycled petro-dollars go? I am sorry to tell you this, but I do not know. I can assume that with all those recycled petrodollars sloshing around Washington, D.C. that the economy for the lobbying firms must be doing OK. And, as we know from Econ 101, that there is a certain amount of trickle down economic activity in the geographic location of Washington, D.C.

You might ask: what does this have to do with economics and money? My answer to this question goes like this: There is the field of mathematics and then there is the field of applied mathematics. This posting today is about applied economics, not just pure economic theory. Economics is a social science, not a pure science. And, to understand how economics works in the real world, issues such as supply and demand and money must be examined under real life conditions. Washington, D.C. is the best real life laboratory to observe the principles of economics as they are practices in a real life environment.

We should not rush to judgment. What would you do for $1 million dollars a year? What would you do for a few more million dollars added on to that? This is the point where economics (money) enters into the world of politics. We all know that campaigns require large amounts of money to purchase TV time and other things needed to run a national campaign. The problem in our democracy is: how do we get the necessary funds to the presidential campaigns without foreign nations having influence on our president and our congress? When we have figured out how to do this, we will have freed our country from its dependency on foreign oil as well as bringing about a democracy that serves the interest of the majority of the people. If I knew how to bring this about, I would give it free to the American people.

Money, like many things in life, is a double edged sword. Money can bring about so many wonderful things. I remember all the Polio carnivals that people held in the early 1950’s to raise money for Polio research. As a young boy, I even worked as a volunteer in a few in my neighborhood as I am sure many other people my age did. There is nothing wrong with people coming together and working for free to raise money for medical research. This is the good part of the sword. But, then there is also the other cutting edge that does not serve the interests of the majority of the people. That is the edge of the lobbyists and their clients whose story and actions could not stand on their own merit. For these people the path of the recycled petrodollars is established. Stay tuned.