Commentary: This is the Age of the Ripoff

“This is the age of the ripoff…”

Joseph P. Merlino’s words rang out with the timbre of the times:

“…We see Nixon’s tax ripoff, the oil companies’ price ripoff, money lenders’ interest rate ripoff, and ripoffs everywhere. We see huge corporations hiring armies of lawyer-mercenaries, at work every day probing the law, testing the law to see what new benefits they can rip off for their bosses. And the public’s interest is defended, only haphazardly, by individuals and associations whose willingness to stand up for everybody else deserves our admiration.”

It was April 15, 1974, at a legislative hearing on a measure creating a new department of state government called the Public Advocate. This was a major initiative on the part of the new Governor, Brendan Byrne, who spoke of “government under glass” as a catch-phrase for opening up the process in an era when Vietnam and Watergate had helped erode public trust. Merlino, a State Senator from Trenton, was sponsor of the measure originally introduced in the Assembly by another Democrat from Trenton, S. Howard Woodson. Creating the Public Advocate, Merlino told the gathered senators, would “bring into government a new and creative force on behalf of the people.”

A lot has changed since Merlino made that statement. Obviously, Richard Nixon is long gone—he would resign in disgrace within four months. But that isn’t the biggest change; you could substitute the names of other politicians instead and everything else about Merlino’s words would still be—to use a Watergate phrase—operative. No, what’s changed isn’t that the statement couldn’t be made today by someone in power—but that it wouldn’t be.

Trust in, respect for, and opinions about government are as bad now as they were back then. But today, few politicians articulate the problem in terms of government failing to do its job for citizens beset by difficulties stemming from the private sector. With all the layoffs, downsizing, benefits cuts, you would think a more active role for government would be demanded. But, today we talk not about opening up government, but closing it down. The tone of these times is to argue not that government isn’t doing enough, but that we’re all worse off because it tries to do too much.

And so today, of course, we have no Public Advocate, the cabinet office having first been stripped of most of its funding by the Legislature and then abolished by an administration that said it was a waste of taxpayers’ money.

I got to thinking about this one day when I read a newspaper saying that New Jersey had recently established in state government the office of the Business Advocate. “Someone has to take the initiative to get cooperation from all people,” Business Advocate Connie Calisti was quoted as saying of her role as a sort of ombudswoman for businesses in their dealings with government.

I’m sure Ms. Calisti is a competent administrator and she means well. But I couldn’t help thinking how narrow, how cramped the current thinking is about the role of government–and what it says about who government is there to help, compared to the view being expressed in the early 1970s about government stepping up in defense of the little guy. The department of the Public Advocate was designed to do things like intervene for the public against state agencies or private businesses by filing class action suits, represent the public before regulatory bodies considering increases in insurance or utility rates, and to be a central receiving place for complaints from the public.

A researcher for the department was quoted in one of the articles written back then as saying, “People who come to us are terribly frustrated. I feel we should do some digging to help them.”

Take out the word “people” and replace it with “businesses” to make the statement work for today’s thinking. But there is an imbalance here. Unlike the sorts of people whose causes would be taken up by the Public Advocate, businesspeople have all kinds of organizations (trade associations, political action committees, the Chamber of Commerce, New Jersey Business and Industry Association) going to bat for them. They have the clout that comes from giving campaign contributions to candidates for Governor and the Legislature (and they give a lot).

And, though it isn’t fashionable to say so these days, business also has a rather shaky record of trying to block, in the name of preserving the business climate, steps to help society as a whole. As Robert Kuttner wrote in a recent issue of The American Prospect: “For the most part, the business sector needs to be dragged kicking and screaming into a social contract. To pretend otherwise is to unilaterally disarm.”

Yet it is such disarmament that government engages in today. The minimum wage, 40-hour week, 8-hour day, child labor laws, environmental protection, parental leave—few of these reforms would be in place today if the positions taken by business groups at the time these measures were introduced had won the day. And now we can’t do enough to make business happy.

Paranoic mouthings of the radical right aside, the free enterprise system is in no danger of being replaced in the United States. It is as strong as ever, but also just as much in need of protection from itself as it ever was. The sad history is that if you give business everything it wants, and let the market rule, a lot of people and a lot of important concerns start to fall through the cracks. And if that goes on too long, even business suffers: you can’t sell anything to people who don’t have any money.

So while there may be nothing inherently wrong with having a good business climate there is lots of room for a real debate about how far the government has to go to guarantee it. Just how many taxpayer dollars should be spent to help out a group of people who have always been pretty good at helping themselves?

If we had a Business Advocate and a Public Advocate, there could be little room for complaint. But when we get rid of the former, and then create the latter, it sends out a disturbing signal about who the government thinks its clients are and what values it seeks to uphold—and a warning signal about where we may be headed in the long run.

A version of this commentary appears in the March/April issueof New Jersey Reporter magazine.