Government Misspending ... Moral Panic, the Senate, the Mint, MPs, heck .... everyone

It appears that there the Canadian Senate has a problem with misspending. But, if even John Oliver is mocking the great scandal ... we might have pause to stop and think about what it is all about because, I want to argue, is it not at all self evident. Oliver's key point is a good one. He does not deny that there has been misspending by Canadian Senators, but he goes on to point out that the federal government spent something like $24.5 million dollars over 18 months to uncover about $1 million in overspending. Thus, Canada lost $1 million dollars to Senate misspending but the total amount lost was actually $25.5 million if you factor in the cost of trying to catch the people doing the misspending. By any count, those don't seem like good numbers.  It is costing, in effect, $24.50 for each dollar that could possibly be recovered. Even if all the misspent money was recovered -- something that seems unlikely -- that would still leave a loss of $23.5 million.

I want to begin by saying that in no way am I apologizing for corruption. Indeed, I think corruption stands at the heart of this scandal. What I want to look at is how this scandal has, as it were, become something more than a scandal about misspending. In addition to addressing the problems in the Senate, we've had reports of misspending in the Auditor General's Office (something of an embarrassment), the Mint, and some political leaders suggesting that MPs should be subject to the same broad and far reaching inquiries. I need to point out that I do not disagree in the slightest with public oversight and with making sure that public money is not mis-managed. I think, in fact, that it is a bit embarrassing that I have to say so. After all ... is there anyone out there who believes in mismanagement? Or, in corruption? We live, in fact, in an odd time when public figures compete with each other to state in the strongest terms they can muster to say that they actually believe in such things as oversight and don't believe in such things as graft and corruption. One would have assumed that this was a precondition for participation in public life; not a statement that needed to be made after one was elected.

This said, there is also something else going on here. I could be wrong (we will find out through legal proceedings)but it seems clear that several Senators used the limited controls exercised over their spending to pad their pockets. You know the names. I won't repeat them here. And, the audit has turned up a few more. But, what surprised me was the disjuncture between the large numbers reported in the press and ... well ... what those numbers actually entail. For instance, only a few more Senators seem to have misappropriated large amounts of money. We heard that 30 Senators (just under 30% of the total membership of the Senate) have claimed and received payment for ineligible expenses. But, most of these are for either very small sums of money or are debatable. The misuse of public funds in the Auditor General's office appears to have been likewise very limited and seemed to involve expensing retirement parties. In other words, no one was profiting. The Mint excursion -- reported here -- seems shakier but much of its shakiness lies in the way it was presented. Here is how the CBC write up begins:

The wine and margaritas seemed to flow as Royal Canadian Mint staff soaked up the sun and dined at a luxury theme park during an expenses-paid trip to a five-star Mexican resort last year at the tail end of an international coinage conference.

There is, as well, the requisite quote from the Canadian Taxpayer's Federation (which is a self-appointed group that, btw, does not report to taxpayers but rather generates its own policies all while speaking in taxpayers' names):

"A lot of Canadians would be beside themselves to see Crown corporation executives spending money this casually," said Aaron Wudrick, the federal director of the Canadian Taxpayers Federation, a national lobby group for lower taxes and accountable government.

I think the Mint is guilty of taking too many people on to this conference, but I doubt the Mint controlled where the conference was held. Canadians, therefore, have a question. Do they want Canadian public officials participating in international conferences in areas that fall within their responsibility? You don't need to take that many people but you likely do need to send someone and, for good or ill, you don't get to pick where most of these events are held, unless we want Canada to  volunteer to host all of them.

Moreover, have a good look at the first line. It is true but also fanciful. Did the Mint staff eat on site while they attended the conference? I would be willing to bet they did. Does this amount to "dined at a luxury theme park?" Did someone sit in the sun after the conference was concluded for the day? I bet they did. Is this "soaked up the sun?" Did someone have a drink? Undoubted. Is this "the wine and margaritas seemed to flow?" What we have here, then, is a form of reporting that does not lie, but presents the truth in such as way as to highlight its worst features. Again, I am not apologizing for the Mint. If rules were broken, whomever broke them should be held to account. That should go without saying. But, the way this is presented tells us something about what is actually going on and why stories of public misspending proliferate in the news.

And, indeed, they do. There was misspending in the Senate but much of it involve grey and debatable areas for small sums of money. Likewise, the suggestion that all MPs should be extensively audited is being made without a single change against any MP of misspending money. Think about that. People are suggesting that the federal government spend another $24.5 million (or, perhaps far far more as there are three times more MPs than Senators so it is likely that the final figure of a Senate style audit of the House of Commons would cost up to $100 million) without any evidence that anything is actually being done wrong.

My point is this: normally, people would not suggest that we spend $24 to recover $1, or that we go on a fishing expedition that might cost up to $100 million in the absence of any evidence that something has been done wrong. There must be some explanation for this behaviour because, one must concede, on its surface it does not look very rational at all. I would not run my household finances this way.

I think that the concerns over public spending and its problems are what social scientists call a "moral panic." Moral panics are related to reality but also have their own dynamics. They develop out of social concerns; this is their connection to reality. But, take on a life of their own that is embedded in the cultural values and power relations of the time. Each of these elements is important to understanding what is going on with Canadian concerns about public spending.

The key thing that seems to be at work -- and to which the imagery in the CBC news articles speaks fairly directly -- is a sense that Canadians are being taken advantage of, that our public figures are using tax dollars to line their pockets. This is not just misspending, in other words, but graft and corruption whereby some people live a life of luxury at the expense of those of us paying the bills by syphoning off taxes as part of an ill-gotten booty.  The question, then, is not just "is this true?" but what does it say about Canadians conceptions of their political leadership that so many people believe this?

The problem, as one might imagine, gets worse from a cultural perspective in dealing with unelected Senators or civil servants. Concern about Senate graft is consistent with a misplaced general view that all politics is corrupt (a misguided view, in my view, about which I have blogged before).  But, this is not just a misguided perception (even while it is politically manipulated by self-appointed "populists"). Instead, it speaks to a sense of distance and the sense untrustworthiness of public figures. It also speaks to a sense of powerlessness. In stating that all politics is corrupt or that one political figure is as bad as the next, what people are saying is that they do not know where to turn and do not know who to trust. There is, said differently, no way out of the political morass and so alienation and disengagement become rational choices that reflect a reality in which corruption rules.

The fact that the focus is more on unelected figures than elected figures might be positive in some sense. It might indicate that there is still a degree of faith in the electoral process, even if there are concerns about corruption. But, the state and unelected figures, on the other hand, seem to be being singled out for particularly negative treatment. The effect is to create a disjuncture between unelected public figures (civil servants and the Senate) and the Canadians they are supposed to serve. They -- these unelected figures -- are somehow different from us. They don't behave the same way; they make ill use of our money; taking personal advantage of it, enjoying drinks on the beach on the public purse, while the rest of us freeze in the winter.

In part, this concern reflects a general alienation of civil society from the state that is understandable. The job of the state is often to regulate civil society and so it is natural that there would be some concern about it. Moreover, the idea that civil servants have it easy -- that they just build red tape and don't do anything useful and are, hence, themselves a waste of money -- is a deeply held view. I don't find it surprising at all that it is expressed this way. Nor, that the Senate -- long subject to critique as a dysfunctional retirement home for politicos -- is hardly shocking. This view, with regard to the Senate is made all the more real by the recent scandals that do, indeed, appear to be cases of graft.  This view of a state out of control, then, is connected to views that are both long-standing and deeply held about a state that is, in effect, out of control, useless, wasting taxpayer money, and which is staffed by individuals who live a high life on public expense ... almost as if they were laughing at us.

But, I think this argument goes further than this. One can and should argue for proper oversight. Savings need to be made where they can be made. But, there is also a political component to this. The critique fits with the idea that our state and government are broken. And, whether or not this is true ... well that is another question and one on which, I will confess, I am of two minds. Last year I blogged about the misconceptions of professorate and tried correct some of those. Many of those misconceptions portray faculty in a way that resonates with this critique, even if it proceeded on different grounds. Faculty waste money, are greedy, don't do anything useful, while ignoring the people they are supposed to be helping. That is not true (and you can see what I have to say if you care to) but the fact that people say it, is important and opens the door for a different type of dialogue.

The same thing is needed with regard to the state. We need a reform of public institutions, to be sure. There is increasingly little doubt in my mind that our current political system needs reform and, I will confess, I have not always been certain of that. But, even with reform, what this attention to spending tells us is that more is needed. After all, even with political reform, there will still be an unelected civil service. And, I don't expect alienation and a sense of powerlessness to change because, say, a voting system changes.

The current discourse of governmental and state corruption and graft is rooted in reality. But, it also speaks to political alienation and disengagement. It speaks to the sense that the state is out of control, enriching itself to the detriment of the public, and is not connected to the public it is supposed to serve. We need to stop the abuse of public funds but in the longer run, spending $25 dollars to recover $1 is not a sustainable solution. Instead, we need to find a way to rebuild confidence in public institutions and this can only be done, I'd suggest with a political reform and a new understanding of what the state is supposed to do. Failing that ... this moral panic might burn itself out sooner or later but another one, and something similar, will pop up to take its place.

Senate Scandal Part I

The current scandal in the Canadian Senate is interesting from a variety of perspectives. A new poll, for instance, suggests that Canadians find this scandal rather serious, more serious perhaps than the sponsorship scandal that helped bring down the federal Liberal Party and helped Stephen Harper and his revamped Conservative Party to power. You can find the news story here:

Canadians Rank Senate Expense Scandal

What I find interesting about this scandal is a number of things. I'll comment on only one here: differing styles of political leadership. Scandals put political parties on the defensive and, when these happen, they employ a standard number of strategies. For instance, they try to deflect attention by pointing to public policy issues on which they think they have credibility (witness the sudden discovery that Canada has more money than previously announced.) Indeed, according to a Vancouver Sun story, the federal Finance Minister predicts that Canada will be out of the red much sooner than expected. Through the first days last week, for instance, Conservatives routinely said that they wanted to focus on the economy, an public policy area where they think  their credibility is high an that of the opposition parties low. Second, they will try to slag the opposition by suggesting that they, too, have done dishonest things. Witness Harper's attack on Mulcair today. Now, this does not indicate that your party has been pure as the driven snow but it raises (or, hopefully raises) suspicious about the other party. Third, they try to "we did the right thing" approach. Paul Martin tried this with the sponsorship scandal. The current en vogue version is "I, the PM, did not know but as soon as I found out I acted to set things right. People in my party may be dishonest but I am not and I will sack those who are." This is Harper's current line du jour, a variant of this is "this is an isolated problem," which Harper used all summer.

What differentiates Harper, however, from previous Canadian PM's is that he's introduced a relatively new innovation to the scandal managing playbook: throw everyone and anyone in your own party remotely associated with this scandal under the bus as quickly as you can. This is the "it was an isolated incident; I have fixed the problem as soon as I discovered it" variant but a particularly nasty one. Duffy was the first to go; Wallin second; Brazzeau third; and now Wright.

Now, I should say I know none of these people and I am not suggesting one way or the other that they are honest or dishonest. I do think Wallin is right on one point: due process is probably something that should be deployed when deciding whether or not to penalize someone (it really does make a difference as to whether this was, say as an example, intentional theft or an accident; intentions count). But, I actually doubt any of these people would even bother to talk to me. So, I am not trying to defend them but point to differing leadership styles.

Compare the way other PMs responded to scandal. Martin with his "Mad as Hell" tour after the sponsorship scandal broke might look like a comparative case but its not (with the exception of Alfonso Gagliano, the ambassador to Denmark). Martin, for all his faults, let the judiciary and the inquiry do its job. He may have hated some of the people in his caucus, but he did not throw them under the bus. Other PMs certainly did not respond in this way. Chretien was shockingly loyal to minister involved in scandals (witness Jane Stewart and Gagliano). Chretien remained defensive and defiant in front of the commission and, to the best of my knowledge, never conceded that there was a scandal. Brian Mulroney, a ghost from the past, may have pressured ministers caught in scandals to retire, but publicly he stood by them.

Harper is not dealing with minister but I can't see either Chretien or Mulroney publicly saying that members of their own caucus or their close advisers were, in effect, dishonest to the point that they should be canned.

What does this tell us. Does it tell us something about the seriousness of the scandal (despite the news story cited above, I doubt it). We are dealing with what is, in government terms, a small amount of money and the next election is, at best, two -- but potentially three - years away (ignore the election law; Harper does). Does it tell us something about the views of the "Conservative base." I doubt it. Where else is that base going to go? And, that base can be satisfied in other ways (some tough talk on "moral issues", for instance, and a few jibes at the "socialistic welfare state" and they will be happy).

Instead, one of the things that I think is important is that it shows us that Harper's leadership style is very different from Chretien or Mulroney's. Perhaps this is because Chretien and Mulroney realized that they were leading brokerage parties and that loyalty on the part of party members was needed to avoid further conflicts, whereas Harper is more ideological and believes that ideology is more important than either Chretien or Mulroney. That is a guess but it might be something to investigate. I think, more than anything else, it points to a different way of leading into and of itself. Chretien and Mulroney expected loyalty (they did not always get it) and were, in return, remarkably -- at times to extreme lengths -- loyal themselves. Harper expects obedience and the two are not the same thing. Ultimately, this scandal may prove more difficult for Harper to escape for precisely that reason. What he's shown is that he will not "dance with the one who brought him," as Mulroney used to like say, if he thinks that dance will hurt his chance of dancing with someone who thinks is better.