Memo To: Bill Keller, NYT columnist
From: Jude Wanniski
Re: Enron’s Cash Payments
Your Saturday “Correspondent” column on Enron’s generosity to the two political parties as it played to the hilt the Washington game of “buying access,” as opposed to “buying influence,” reminded me of a lesson I learned 40 years ago. It also stirred up recollections of how journalistic standards have been devalued over that same time frame.
When I was a young "investigative reporter" for the Las Vegas Review-Journal in the early 1960s, I learned an important lesson about business influence in the political world. I asked a top manager at the Desert Inn, then a mob hotel with close ties to the Chicago/Cleveland syndicate, why they never backed political candidates. Here was the biggest industry in the state and it was almost unheard of for any of the hotel/casinos to be identified with an incumbent or challenger, from the governor on down to the local offices. They made lots of campaign contributions, but gave everyone equal amounts of campaign contributions. The DI manager smiled and told me they did not like the odds of picking one candidate over another: “We’d rather back both candidates and give the winner a bonus."
If that sounds like a sneaky thing to do, it is also the smart thing to do if neither candidate is a “reformer,” out to win the election by going after you with promises to “clean things up.” I got to know the late Benny Binion back in those good old days. One day when I had lunch with him and his son Jack, I asked Benny how he wound up in Las Vegas. He told me he was living in Dallas after the war, making a good living in the harmless rackets. “Reform Party won the elections, so I decided to come here to wait for it to blow over.” Benny wound up staying because he had a lucky roll of the dice at about the time it was safe to go back to Dallas. Besides, because gambling was legal in Nevada, he wouldn’t have to leave town, as there were no “reformers” there. The Desert Inn executive told me how much of a pleasure it was to operate in Nevada. “It costs a lot more money to run illegal games in Chicago than it does to support honest elections in Nevada.”
It was these kinds of experiences that have led me to oppose “campaign finance reform.” If you make it illegal for businessmen to give campaign contributions openly, with bonuses to the winner, you only make it more expensive for them to make policy by buying politicians. The much better approach is to make fewer actions illegal, at least when the actions are harmless. I’m not talking about libertarian measures to legalize hard drugs. I mean simplifying the federal tax laws and the myriad regulations that are generated by the thousands each week, by one agency or another. Every time you make something else an infraction of federal law, you force the man on the margin to decide whether to risk an infraction, or go out of business as an honest man.
What is much clearer to me is that the major media have drastically devalued journalistic ethics over the years. When I first joined Dow Jones & Co. in 1965, as a reporter for the National Observer, it was made clear that you could not accept ten cents from private enterprise. In 1976, when I was at The Wall Street Journal editorial page, I learned that I could not leave the newspaper and expect to ever return if I took corporate money on any account. In other words, if I left for a year to be a public relations man for General Motors, I would be barred forever at Dow Jones. Because I needed to have time off to write my book, The Way the World Works, the only venue I had was an academic fellowship. This was the only loophole in the Dow Jones system, which had been set up to protect against the slightest appearance of a conflict of interest. As I recall, Alan Otten, the Washington bureau chief of the Journal, wanted to write a book and received permission by obtaining a leave of absence. I wound up doing the same, with the help of Irving Kristol and the American Enterprise Institute. The funds I needed to support the venture were supplied by the Smith-Richardson Foundation.
In the years that followed, these strict standards were first shaved, then obliterated. The money that has been flashed around by the television networks, especially after cable-TV expanded the field, has forced the print media managers to make one exception after another to their top editors, columnists and reporters. To hold them to the standard would generally mean you would lose them. It has gotten to the point where a hotshot will be able to work for peanuts at one of the major newspapers, doubling his/her income with media fees, then doubling or tripling again with speaking fees. It has by now come full circle, where the son of the man who helped get me an academic fellowship to avoid the appearance of a conflict of interest has collected $100,000 from Enron while employed as the editor of a political periodical. For what? What did Enron get for its $100,000? What does the editor think he gave for the $100,000? It all looks pretty fishy to me, but then I am a fundamentalist when it comes to these kinds of things.
The reason I write to you, Bill, is that I think you are next in line to be executive editor of the Times, when Howell Raines retires in five years. And Howell has been the gold standard when it comes to this kind of thing. He may have been on some television show or another in his career, but I will guess he did not get paid for his appearance, and if pay had been offered, he would have said no thanks. My old editor at The Wall Street Journal, Bob Bartley, was just as scrupulous in his almost 30 years at the helm of the editorial page. These kinds of journalistic standards may seem old-fashioned, like the gold standard itself, but as long as the Times can hold its best journalists simply because they want to work for the best newspaper, we have a shot at restoring the highest standards to the rest of the news media. It would be sad to think it will never happen.