The Price of Civilization: Reawakening American Virtue and Prosperity by Jeffrey D. Sachs Page A

thinking about long-term issues: infrastructure, budget balance, education, energy policy, and climate change. It is hard to think of a single recent case in which the U.S. government, led by either party, has produced a quantitative assessment of any long-term challenge and then followed through with a considered policy reform based on that assessment. For decades, Washington has been improvising through the repeated alternations of power.
    The Four Big Lobbies
    The corporatocracy is a quintessential example of a feedback loop. Corporate wealth translates into political power through campaign financing, corporate lobbying, and the revolving door of jobs between government and industry; and political power translates into further wealth through tax cuts, deregulation, and sweetheart contractsbetween government and industry. Wealth begets power, and power begets wealth.
    Four key sectors of the American economy exemplify this feedback loop. The military-industrial complex is perhaps the most notorious example. As Eisenhower famously warned in his farewell address in January 1961, the linkage of the military and private industry created a political power so pervasive that America has been condemned to militarization, useless wars, and fiscal waste on a scale of many tens of trillions of dollars since then. 10
    The second powerful lobby is the Wall Street–Washington complex, which has steered the financial system toward control by a few politically powerful Wall Street firms, notably Goldman Sachs, JPMorgan Chase, Citigroup, Morgan Stanley, and a handful of other financial firms. The close ties of finance and Washington paved the way for the 2008 financial crisis and the megabailouts that followed, through reckless deregulation followed by an almost complete lack of oversight by government. Wall Street firms have provided the top economic policy makers in Washington during several administrations, including the likes of Donald Regan (Merrill Lynch) under Reagan, Robert Rubin (Goldman Sachs) under Clinton, Hank Paulson (Goldman Sachs) under Bush Jr., and several Wall Street–connected senior officials under Obama (including William Daley, Larry Summers, Gene Sperling, and Jack Lew).
    The third sector is the Big Oil–transport–military complex that has put the United States on the trajectory of heavy oil import dependence and a deepening military trap in the Middle East. Since the days of John D. Rockefeller and the Standard Oil Trust a century ago, Big Oil has loomed large in American politics and foreign policy. Big Oil teamed up with the automobile industry to steer America away from mass transit and toward gas-guzzling vehicles driving on a nationally financed highway system. Big Oil has consistently and successfully fought the intrusion of competition from non-oil energy sources, including nuclear, wind, and solar power. Big Oil has been at the side of the Pentagon in making sure thatAmerica defends the sea-lanes to the Persian Gulf, in effect ensuring a $100 billion–plus annual subsidy for a fuel that is otherwise dangerous for national security. And Big Oil has played a notorious role in the fight to keep climate change off the U.S. agenda. ExxonMobil, Koch Industries, and others in the sector have underwritten a generation of antiscientific propaganda to confuse the American people.
    The fourth of the great industry-government tie-ups has been the health care industry, America’s single largest industry today, absorbing no less than 17 percent of GDP. The key to understanding this sector is to note that the government partners with industry to reimburse costs with little systematic oversight and control. Pharmaceutical firms set sky-high prices protected by patent rights; Medicare, Medicaid, and private insurers reimburse doctors and hospitals on a cost-plus basis; and the American Medical Association restricts the supply of new doctors through the control of placements at American medical schools. The result of