Winners & Losers in the Latest Clinton Scandal (Spoiler Alert: The American People are the Biggest Losers)


In USA Today, Glenn Reynolds of Instapundit lays out his take on the big winners and losers in fallout from the first splash of publicity surrounding Peter Schweizer's forthcoming book Clinton Cash, which posits a nexus of influence-peddling between Hillary Clinton's role as Secretary of State and The Clinton Global Initiative, the nonprofit fronted by Bill Clinton.

The winners:

First, this is a shot in the arm for her potential Democratic challengers, who have labored in obscurity. Probably the biggest beneficiary is former Virginia senator James Webb, whose military background and more centrist views could help bring in the white working-class voters that the Democrats are realizing they have alienated during the Obama era. Also helped is Sen. Elizabeth Warren of Massachusetts, though her close resemblance to Clinton (another northeastern Ivy League white woman) and her own strong corporate ties (Warren made money advising asbestos companies how not to pay claims, and is worth many millions) might hurt. Former Maryland governor Martin O'Malley also gets a boost, though he's the probably the longest shot of the three….

On the Republican side, Clinton's travails both hurt and help. By making the political establishment look corrupt, they especially help the anti-establishment candidates such as Wisconsin Gov. Scott Walker and Sens. Ted Cruz and Rand Paul. By damaging a Democratic front-runner, they might help Republican establishment favorite Jeb Bush. But given the closeness of the Bush and Clinton families in recent years — you'll seethat video of Jeb Bush presenting Hillary Clinton with a Liberty Medal, on the eve of theBenghazi anniversary, a lot during the GOP primaries — if the whole Bill-and-Hillary dynasty looks corrupt, the Bush dynasty could be tarnished by association. And, in fact, the corruption associated with the Clintons might make voters more skittish about political dynasties in general.

Reynolds also includes pundits and media in the winners category, as this latest flap is a godsend in terms of coverage possibilities.

More here.

Let me suggest one big loser that Reynolds scants: the American people. We've already got lower-than-low confidence in the federal government, with just 3 percent believing that the federal government does the right thing "just about always." The sort of revelations at the heart of Schweizer's charges ring true despite whatever else comes to light. Of course there are unsavory connections among supremely powerful politicians and business interests, including those in countries openly hostile to the United States. And of course politicians and public figures are going to milk those connections for money and power in ways that are utterly at odds with what might constitute the public interest (however difficult to define). Recall too that Schweizer's next project is looking at similar if closer-to-home dealings of Jeb Bush.

The result is a dispiriting picture that will only make it more difficult for policymakers to win the trust and confidence of the electorate when they are proposing serious, above-board legislation. Which in turn may well make it that much harder to reduce the size, scope, and spending of government at all levels. The minute a system is recognized as thoroughly corrupt, most people semi-rationally start trying to figure out how to loot the system rather than reform it. As I've noted previously, there's evidence from global surveys that distrust in government legitimacy correlates with calls for more intense regulation of the economy and other aspects of life. It's an unexpected but understandable reaction from citizens who want fairness in their dealings with authority. Yet it ultimately abets even more corruption by growing the reach and hence power of government and, by extension, opportunities for corruption.

[In] the 2010 paper "Regulation and Distrust," written by Philippe Aghion, Yann Algan, Pierre Cahuc, and Andrei Shleifer and published in The Quarterly Journal of Economics. Drawing on World Values Survey data from the past several decades for over 50 countries, the authors help explain what they call "one of the central puzzles in research on political beliefs: Why do people in countries with bad governments want more government intervention?"…

In [high-trust countries], most people have positive feelings about business and government and the general level of regulation is relatively low. In "low-trust countries," the opposite is true and citizens "support government regulation, fully recognizing that such regulation leads to corruption." As an example, they point to differing attitudes toward government-mandated wages in former socialist countries that transitioned to market economies. "Approximately 92 percent of Russians and 82 percent of East Germans favor wage control," they write, naming two low-trust populations. In Scandinavia, Great Britain, and North American countries, where there are higher levels of trust in the public and private sectors, less than half the population does. As a final kicker, Aghion et al. suggest that increased regulation sows yet more distrust, which in turn engenders more regulation.

With just 3 percent of Americans already trusting the federal government to do the right thing "just about always" and just 20 percent trusting it "most of the time," the United States may well be sliding toward a low-trust country. Certainly out trust in government in the 21st century has been hollowed out by terrible governance, duplicity, and outright mendacity on the part of successive Republican and Democratic administrations that have always passed massive new regulations on all sorts of activities big and small.

Ironically, being able to trust that government actors are not simply lining their own pockets and acting at the beck and call of self-interested big shots may well be a first step in reducing the government's power over our lives. The candidates that can make that case persuasively may not end up winning in 2016 but they will definitely be prodding the country in a better direction.