The Wire: The Sixth Season

Of course, HBO’s “The Wire” only lasted 5 seasons, but David Simon’s post romp as public intellectual to the chattering opinion classes suggests a sixth season: how a paunchy middle class white dude pimped the stories of the Baltimore city streets to a life of wealth, fame and self-appointed status as a de facto translator of black America to the progressive vanguard.

But rest assured, what Simon is saying now—government is just “us” and it’s failings are to be blamed on lack of institutional trust fueled by the evil designs of libertarianism–is not what he said on The Wire.

Granted, what he is saying now may make him the toast of the town on social media and the Washington cocktail circuit, but that jive bullshit would have never been green lighted for television, much less becoming a cult cultural phenomenon, even to the point that it’s sociological lessons are now taught for university course credit. Of course, without the fame of The Wire, no one would care to toast Simon on Twitter or in the halls of the Roosevelt Institute, and he would be just another obscure casualty of a Baltimore Sun layoff.

Then again, perhaps a 6th season of The Wire would be redundant. After all, its lesson would be the same as the first five. Institutions serve themselves and the people who work within them invariably serve the institutions. The Wire’s terminal conclusion was that life simply goes on.

The Incontrovertible Firm

“How Disclosed NSA Programs Protect Americans, and Why Disclosure Aids Our Adversaries”

The official title of the recent and rare public US House Select Committee on Intelligence oversight hearing of the NSA

For the past three years, I have used this blog as a forum(to an admittedly limited readership) to rail against the security state. A particular gripe has been that while the admission of the thing has always been acknowledged the violation it constituted nonetheless usually remained outside the purview of consideration.¹ At best, the violation may have been treated as a secondary or tertiary one. But this dereliction(of intellectual method) can no longer stand. The past two weeks, Edward Snowden, a NSA contractor, has now verifiably leaked what has hitherto been the elephant in the room: the totalitarian US surveillance enterprise.

And make no mistake, it is an enterprise. I call it The Firm, borrowing heavily from Anthony de Jasay’s heterodoxical method of Rational Choice that treats the State as a type of unitary actor². But the Firm encompasses more than the what is traditionally thought to mean by the State. It stretches across an integrated nexus of political economy, media, academia, ingraining itself into every institution of civil society. As I have previously stated, the Firm is a rational choice casting of libertarian class theory.

The key insight of LCT–in contradistinction to liberal social contract theory–is that the State and civil society are in conflict. Liberalism holds that the State is an artificial construct to secure civil societal ends. However, practice has demonstrated that the State instead serves to subvert societal institutions, using them as “natural hosts” to effectuate an artificial process of political economy. Borrowing from Bastiat, we might depict this a the transformation of law as an instrument of justice(specifically, as the correction of injustice) to one of a perpetuation of injustice(plunder). The division of class then refers to those who depend on this perpetuation of injustice(or benefit from it) vs those who do not³.

In the jargon of rational choice, we would cast LCT as the “incentive-incompatibility problem” of collective choice to abide by the “unanimity” of the so-called social contact. In plain terms, this simply means that “constitutions” are not rational constraints against the rule-making power or authority of the State. If we dispense with this myth, then we can begin to actually examine the actual rational pattern of collective choice. What we often find is a hierarchical organization pattern serving as a de-facto decision-making rule. In public choice, a decision-making rule is the type of collective action method that imposes the decision-making costs(the price we pay for civilization) for participation in organized society. For Buchanan and Tullock, the only legitimate decision-making rule is unanimity⁴. In practice, this means super-majoritarian constitutional rules and amendments are the only legitimate decision-making rules.

In the original “Calculus of Consent,” side payments create marketable property rights in voting which often mitigate the external and decision-making costs of legislative action. However, later developments in the theory by Tullock advanced the idea of “rent-seeking” and the all pay auction at the methodological core of treating government/politics like a market. This rent-seeking game, however, can be very wasteful–in theory, infinitely wasteful. So, following Oliver Williamson’s treatment of The Firm–firms are DROs that arise as institutional mechanisms to mitigate wasteful bargaining costs–firms arise in political competition as means to fray the wasteful costs of the Tullock rent-seeking game⁵. This introduces the Firm as potential method of collective action. If we can identify high external costs of a firm’s rule making that nonetheless remain impervious to correction or reform, then we can explain this by treating these costs as decision-making costs. This would then gives us the Firm as a decision-making rule. And the Firm as a decision-making rule gives us “the State as its own Agency.”

Empirically, a firm can be demonstrated via a rent-seeking condition of rents >> outlays within a given market sector(of political economy). However, to show the Firm is not sufficient to show a decision-making rule.⁶ For this, we have to demonstrate external costs of the Firm equate to decision-making costs. A clear way to demonstrate this is to show a rule which overrides one derived from a legitimate decision-making rule. Put differently, showing enforcement of a firm’s rule that is blatantly unconstitutional is sufficient to show that firm as a decision-making rule.

For example, the public choice method excludes a statement such as “total surveillance is the price we must pay for the security to participate in organized society” because total surveillance overrides a number of rules derived from a legitimate decision-making rule, the unanimity of the bill of rights. To treat these costs as external costs is contra the public choice method because these costs are, in fact, decision-making ones. Now public choice per se certainly does not exclude legislative actions from imposing decision-making costs(if the decision-making rule is a simple majority system, then this is to be expected), but the standard method encounters an agency problem in explaining how decision-making costs are passed off as external costs to thwart a decision-making rule rooted in unanimity. Particularly, if this agency exhibits a concerted, coordinated organization pattern that encompasses military and intelligence organs, congressional leaders, the Dept. of Justice, media and journalistic organs, tech, telecommunication and defense industry sectors, political science academia and the like, etc. The agency problem is further compounded by an apparent legality established by secret courts, the public disclosure of such carrying a penalty of “aiding the enemy” and espionage. This is a vexing problem for standard public choice theory because there is a manifest agency afoot that appears to equate the public to “the enemy.”

The NSA as a Decision-Making Rule

Now let us return to Edward Snowden. What Snowden actually discovered amounted to a NSA/Intel decision-making rule. However, Snowden’s documentation trove, when fully revealed, will elucidate just how much of these rules are actually oriented around enforcing a 21st century mercantilist political economy rooted in data analytics(which I have dubbed “The Fifth Monopoly”). The so-called “liberty vs security trade-off debate” is a phony one. The decision-making cost is not this:

total surveillance is the price we must pay for the security to participate in organized society

Rather, it is this:

total surveillance is the price we must pay for the operational security of American dominance and control of the global political economy of data analytics

The latter is a decision-making cost that can only be implemented by decision-making rule such as the NSA. If we go by Russ Tice, a noted NSA whistleblower from the Bush tenure, the NSA, for all intents and purposes, is now the agency of the US government. This would put the US as a full-blown secret intelligence State.

Conclusion

The method of The Firm is an anathema to the traditional classical liberal schools of Chicago and Virginia because of the inversion of Milton Friedman’s famous relationship regarding capitalism and freedom. Capitalism is a necessary(though not sufficient) condition for political freedom. The Firm, however, employs a method that predicts a rent-seeking pattern that will eventually produce a decision-making rule that will displace legitimate decision-making rules rooted in unanimity. The Firm’s succinct relationship motto: Capitalism is a sufficient(though not necessary) condition to destroy liberal political freedom.

Still, one may ask how can capitalism result in a totalitarian regime of social control? Perhaps this short answer: when you stop being the customer and instead become the product itself. But “why” is not really the pertinent question here. Rather, the pertinent question is “why not”? From “incentive-incompatibility problem” of collective choice outlined above, there is no reliable “why not” constraint.

¹ for the most part, radical libertarianism excluded

² The Firm differs a bit from de Jasay’s account in that the former is squarely rooted in public choice, which is a narrower subset of rational choice. But the conclusions derived from each are more or less identical.

³IMHO, Class Theory is only a coherent methodological tool when it is institutionalized, i.e., classes are cast in institutional terms. In this sense we would say there are a class of institutions, or an institutional arrangement, that is entirely dependent on an artificial process of political economy, without which, it would disappear literally overnight.

⁴ Unanimity is required because of the potentially high external costs of collective action. By definition, an external cost is that cost to a party who did not choose to incur that cost. Unanimity ensures the cost is thus a decision-making one and not an external one. In other words, unanimity ensures “consent.”

⁵ Theoretically, Firms are a difficult thing to explain. But empirically, they obviously exist and are a fundamental organizational unit of market rent-seeking. It is simply not plausible to acknowledge them in free-market competition but deny them in political competition. Its not a defensible position(that is, there is no rational argument that necessarily explains them away in political competition, particularly given the difficulty of a rational argument to begin with to explain their existence in a free market). Legal distinctions/arguments are a red herring.In political competition they may not take the form of a de jure entity, but they are nonetheless, a de facto one.

⁶ Tullock himself had wrestled with the apparent persistence of Firms in (political) rent-seeking and succeeded in partially explaining them away by resorting to intellectual gymnastics vis-a-vis the efficiency of the rent-seeking technology. However, the persistent of firms would only be treated as an anomaly, and its attendent costs viewed primarily as external. The anomaly perhaps existentially threatened the validity of public choice as a method, but the threat was not viewed as something that extended to liberal democracy itself.

The Copyright Alert System Now Being Rolled Out at Major ISPs

In the next two months, AT&T, Time Warner, Verizon and Comcast will implement the The Copyright Alert System program developed by The Center for Copyright Information. Of course, The Center for Copyright Information is a RIAA and MPPA front. The monitoring system that will be used will rely on the MarkMonitor service that has been in place for a numbers of years now. The “monitors” will be The Center for Copyright Information, i.e., RIAA and MPAA. Once again, these entities have been monitoring bitTorrent traffic for years. Indeed, a recently presented Security Research Paper concludes that you can expect to be tracked within 3 hours of firing up a torrent client.

The primary change is that in lieu of direct legal action(which can be frictional), the RIAA/MPAA, using the aforementioned ISPs as agents, can now engage in a relatively frictionless enforcement operation. And this is where the data analytics begin to kick in. Large-scale users will still be subject to the same modis operandi legal action but the voluminous data that has been collected over the years by the likes of MarkMonitor will now be used as a queryable data repository against which the new data will be used–according to whatever algorithm employed–to trigger the Copyright Alert Notifications to end users via that user’s ISP(serving an agency role of a Sheriff, more or less).

Evasion tactics? Well forget about things like Tor. Tor works over the tcp protocol(and can’t handle the load of p2p file sharing to begin with). bitTorrent these days works over udp. Sophisticated encryption techniques like mse/pe to me are more about thwarting ISP throttling, but in this case it is not the ISPs who are the monitoring agent. The best evasion technique is to use a udp proxy. But I imagine that a reliable service with tolerable speed is going to cost money which begs the question a bit of why not simply spend the money on a paid download music service. That was basically my decision around 6 years ago when the opportunity costs of evasion(when the monitoring really began to pick up) well exceeded the monthly subscription cost of a paid service.

Of course, the Copyright Alert System is just harbinger of things to come. These types of arrangements up and down the IT stack will increase by orders of magnitude under the formal adoption of whatever “cybersecurity act” that eventually passes(once again, because the basic top-level rules will be enacted via fiat, i.e, executive decision, the subsequent proposal and adoption of a legislative act is an absolute certainty). And this, of course, just exposes the silliness of the “network neutrality debate” because “network traffic” should always be understood to mean “authorized network traffic.” The arbitration between “authorized” and “unauthorized” traffic will be subject to the most relentless data analytics imaginable.

I will also offer a brief comment on unjustified triumphalism that thinks these issues can be magically skirted around. This belief is based on a fundamental mischaracterization of the internet as a horizontal, decentralized type of network. But it is not that. Rather, the internet is a type of scale-free, small network that follows a power law distribution. The network properties of scale-free invariance is much a product of quite a bit of centralized coordination. Simply, it is a mistake to think that technology alone can overcome the problem of political economy. Instead a necessary condition to be able to “route around the damage” is jurisdictional differentiation in political economy. I’ve been harping this point for a couple of years in my posts about Wikileaks. If the jurisdictional differentiation melts away then feel free to proceed straight to the outright pessimism of Evgeny Morozov and Richard Stallman who have given up on the anarchic promise of the internet. The alternative is a platform that turns out to be very well suited for tight control by Corporation and State. The evidence for this latter pessimism is the degree of rent-seeking in data analytics this little platform of ours affords(which makes the actions of State agency very much “rational” and hardly stupid in this space). The game is up when the cyber-security and “data czars” come rolling down the pike.

Finally, The Copyright Alert System is once again immediate evidence of a “Commercialist” anomaly with regard to political economic agency. Methodological individualism is hard pressed to explain ISPs acting as a Sheriff Agency (on behalf of the RIAA/MPAA) against their own customers. The model of The Firm, however, explains it quite well.

From WikiLeaks: How the Drug War Underlies The Firm

A Public Choice definition of “The Firm” is the agency that arises from the “incentive-incompatibility problem” of collective choice. This agency, however, is also an organ of political economy. The political economic construct of The Firm is what allows us to tie it to the classical concept of libertarian class theory(note: it is a mistake to try to relate the standard realm of public choice to the old French Laissez Faire model of political economy. To make this relation, you must more or less discard “methodological individualism” from the model of State actors. Hence, most, if not all, traditional public choice scholars will reject “The Firm” outright).

The positive model of “The Firm” allows us to make predictions. For one, the drug war will never peacefully end because the discretionary authority the drug war legitimizes is a core foundational component of The Firm. At best, any legalization efforts will simply result in a FDA, Bristol Myers Squibb, DEA triumvirate. In a real sense, the latter may actually provide the means for greater social control than outright illegality.

If the thing that “The Firm” maximizes is discretionary power or authority, then perhaps “The Matrix” is a better understood cultural descriptor than “The Firm.” However, the use of the term, “The Firm,” is illuminating because it reminds us that the agency in question is at its core a politically economic one. The Firm is the (protectionist) coordinated arena where the “competition” of capitalism takes place. It is the “market setter.”

As with “The Matrix,” it may be the case that the only way to fully understand “The Firm” is to see it for yourself. So below, I have posted a link from the recent WikiLeaks file dump. This is actually a publicly available document and not a secret one. But it is captured from the inner correspondence of the global intelligence firm, Stratfor.

International Narcotics Control Strategy Report: Money Laundering and Financial Crimes.

The introduction says it all: engineering an efficient international enforcement paradigm of anti-money laundering measures that starts with terrorism and drugs but under a “one-size-fits-all” vein can be effortlessly extended to any unauthorized monetary exchange. The table of contents provides the staggering breadth and scope of The Firm’s coordination.

To those that say “there is no firm,” I say positive science is useless if we do not believe what we see with our own eyes. To those who say “if you don’t like it, leave,” I say it is clear that there is no escaping the jurisdiction of The Firm.

The “Big Data” Firm

The likes of Charles Rowley will say “there is no firm.” I say “yes there is.” Here is what it looks like.

Public Choice and The Firm

Some readers may be interested in this little exchange I had with Charles Rowley a few weeks back. Admittedly, I started the commentary with a bit of a snarky entrance, asking how the “Dean of Public Choice” could allow his heart to be captured and uplifted by a politician’s speech(more precisely, the speech of a politician’s wife). However, what followed was civil, and it perhaps sheds some illumination on the methodological differences between “classical liberals” and libertarians.

An important question is why “classical liberals” often seem to have a natural alignment with conservatives? My methodology, which I would deem to be consistent with “classical libertarianism,” finds this alignment to be fatal. But we are given a clue by Rowley’s rejection of the method of “The Firm.” Indeed, Rowley (although he is an admirer of de Jasay and counts him as a good friend) rejects de Jasay’s inclusion within the public choice discipline. Rowley writes:

Jasay’s work is not public choice. Jasay deals with an organic state, not methodological individualism. What would you do if you were the state is his question. There is no such thing as a state. Only a collective of individuals.

I would dispute Rowley’s contention. I think the agency of The Firm is quite real and apparent. Would one likewise say “there is no Microsoft or Google, there is only a collection of individuals?” Indeed, I would submit that the agency of The Firm(as a type of DRO) is a natural consequence of economic rent-seeking. And I would apply this consequence to both political economy and “the free market” by simply adopting the very generic definition of economic rent as “returns in excess of opportunity cost (noting, however, that a legal structure of the firm does not necessarily equal the limited-liability corporation. A DRO can have an arbitrary structure, although a certain degree of verticality and hierarchy is implicit).

In a comment, I outlined a long-winded microeconomic foundation for the Agency of the State. This agency is real. But we can arrive at it via a microeconomic method. As I like to say, I can draw line from Public Choice to de Jasay to the class theory of the French Laissez Faire economists.

Interestingly, in the place of The Firm, Rowley advocated an alternative model of “The Prince,” which is the name I bequeathed to the method that emerges from “The Dictator’s Handbook.” I have not actually the read the book, but it is clear(from reading reviews and Rowley’s comments) that The Prince has universal application–it applies to both institutions of State and Civil Society. So to save “methodological individualism” as a method(almost treating it as an end to be preserved rather than as means), Rowley appears willing to dispense with a compelling insight of liberal social theory: individuals with different interests and ends can nonetheless use reason as a tool to coordinate these interests to mutual advantage.¹ This insight simply cannot survive The Prince.

Once again, “classical liberalism” derived from a Public Choice method constrained by the classical liberal bounds regarding the agency of the State is simply not coherent.

¹ The Better Angels of our Nature

Roberts Affirms the Total State Model

Yesterday, the Roberts court affirmed the Obama defense of the so-called “Affordable Care Act.” To me, it is not a particularly surprising result. Two years ago, I noted that the Obama Admin’s principal argument relied on the classification of the mandate as a tax and that the legislation–all 2000 pages plus–was carefully crafted to categorize any penalty as an excise tax. As I wrote at the time, Obama–his “socialist” caricature notwithstanding–wasn’t arguing the case by making appeals to the Communist Manifesto. He was merely relying on past American constitutional precedent. He had “the firm’s” legal team carefully draft the new rules of the health care political economy to pass compliance strictly with the firm’s monopoly power to tax.

And it passed the compliance test. Indeed, John Roberts used this decision to affirm the role of his court to be the adjudicators of compliance and not the arbiters of constraint. Really, the judiciary is the only possible monkey wrench in a model of total government by political competition/rent-seeking. Yesterday, Roberts proclaimed that the role of the judiciary is not to save us from democracy, which, of course, means “the firm.”

We simply pose a simple question to Mr. Roberts: who wrote that 2000 page piece of legislation? Who could compose an entire model of political economy from the mere power to tax in a fully “compliant” manner. Justice ain’t that blind, sir….

Incredibly, there are some so-called libertarians who are hailing this decision as a bulwark against the future regulatory State because of some speculative nonsense that Roberts has now taken the “commerce clause” off the table. Sheeeeyyyyyytttttt. The regulatory state ultimately derives from the power to tax. The Firm more or less is the regulatory state. It is not going anywhere.

Let us dispense with the romance and the delusion. Politics is a rent-seeking game. Richard Posner and the Chicago School had it wrong. It is not a game where nothing is being redistributed, that is, where outlays = rents. Tullock and the Virginia School have the better model but resorted to a ridiculous “inefficient market hypothesis” to try to save liberalism in a public choice context when it became apparent that rents >> outlays. Tullock, himself, in explaining why he couldn’t convert to the libertarianism, more or less admitted that he simply preferred the blue pill to the red pill–he was too married to the institutionalism he was critiquing to defect.

If we accept that firms can arise in a “free market” of horizontal trading partners because a hierarchy of economic governance can sometimes prove to maximize economic rents relative to a regime of horizontal trading partners–as a consequence of the frictional costs of bargaining–we have to accept the reality of “firms” in political competition. It is indefensible to hold a position of firms as a consequence of economic rent-seeking in a free market but no firms as a consequence of rent-seeking in political competition. Yes, we can think of political parties as “firms,” but the actual firm is the State.

Today we know(or we should know) that Madisonian Democracy is a horribly flawed political concept. The idea that high institutional frictional costs constrain political competition/rent-seeking is just wrong. On the contrary, the high institutional transaction costs are what actually guarantee the emergence of “the Firm.” Equal competitive agents(“gangs”) fighting over rents in a highly frictional environment can be literally infinitely wasteful. To avoid this, you thus have a type of hierarchical, economic governance that emerges–the Firm.

John Roberts, “evil genius,” I think not. I think the evil geniuses are these libertarian think tanks and mags that keep propagandizing “proper role of government,” “limited government,” and demonstrate infinite capacity to find “silver linings” in libertarian-conservative fusionism. You doubt the “State as Firm?” Well, sometimes you just have to actually give a demonstration of the empirical reality. Below is just the “legislative component” of “the Firm.” Do you see any silver linings, any evidence of limited government, any evidence that it matters one fuck whether it is the monopoly power to tax or to “regulate” regarding the ends of our Firm?

The House Legislative Component of The Firm

Committee		Chairperson	Ranking Member
	Subcommittee
Agriculture		Frank Lucas (R-OK)	Collin C. Peterson (D-MN)
	Conservation, Energy, and Forestry	Glenn Thompson (R-PA)	Tim Holden (D-PA)
	Department Operations, Oversight, and Credit	Jeff Fortenberry (R-NE)	Marcia Fudge (D-OH)
	General Farm Commodities and Risk Management	Mike Conaway (R-TX)	Leonard Boswell (D-IA)
	Livestock, Dairy, and Poultry	Tom Rooney (R-FL)	Dennis Cardoza (D-CA)
	Nutrition and Horticulture	Jean Schmidt (R-OH)	Joe Baca (D-CA)
	Rural Development, Research, Biotechnology, and Foreign Agriculture	Timothy V. Johnson (R-IL)	Jim Costa (D-CA)
Appropriations		Hal Rogers (R-KY)	Norm Dicks (D-WA)
	Agriculture, Rural Development, Food and Drug Administration, and Related Agencies	Jack Kingston (R-GA)	Sam Farr (D-CA)
	Commerce, Justice, Science, and Related Agencies	Frank Wolf (R-VA)	Chaka Fattah (D-PA)
	Defense	Bill Young (R-FL)	Norm Dicks (D-WA)
	Energy and Water Development	Rodney Frelinghuysen (R-NJ)	Pete Visclosky (D-IN)
	Financial Services and General Government	Jo Ann Emerson (R-MO)	José Serrano (D-NY)
	Homeland Security	Robert Aderholt (R-AL)	David Price (D-NC)
	Interior, Environment, and Related Agencies	Mike Simpson (R-ID)	Jim Moran (D-VA)
	Labor, Health and Human Services, Education, and Related Agencies	Denny Rehberg (R-MT)	Rosa DeLauro (D-CT)
	Legislative Branch	Ander Crenshaw (R-FL)	Mike Honda (D-CA)
	Military Construction, Veterans Affairs, and Related Agencies	John Culberson (R-TX)	Sanford Bishop (D-GA)
	State, Foreign Operations, and Related Programs	Kay Granger (R-TX)	Nita Lowey (D-NY)
	Transportation, Housing and Urban Development, and Related Agencies	Tom Latham (R-IA)	John Olver (D-MA)
Armed Services		Buck McKeon (R-CA)	Adam Smith (D-WA)
	Emerging Threats and Capabilities	Mac Thornberry (R-TX)	Jim Langevin, (D-RI)
	Military Personnel	Joe Wilson (R-SC)	Susan Davis (D-CA)
	Oversight and Investigations	Rob Wittman (R-VA)	Jim Cooper (D-TN)
	Readiness	Randy Forbes (R-VA)	Madeleine Bordallo (D-GU)
	Seapower and Projection Forces	Todd Akin (R-MO)	Mike McIntyre (D-NC)
	Strategic Forces	Mike Turner (R-OH)	Loretta Sanchez (D-CA)
	Tactical Air and Land Forces	Roscoe Bartlett (R-MD)	Silvestre Reyes (D-TX)
Budget		Paul Ryan (R-WI)	Chris Van Hollen (D-MD)
Education and the Workforce		John Kline (R-MN)	George Miller (D-CA)
	Early Childhood, Elementary and Secondary Education	Duncan D. Hunter (R-CA)	Dale Kildee (D-MI)
	Health, Employment, Labor, and Pensions	Phil Roe (R-TN)	Rob Andrews (D-NJ)
	Higher Education and Workforce Training	Virginia Foxx (R-NC)	Ruben Hinojosa (D-TX)
	Workforce Protections	Tim Walberg (R-MI)	Lynn Woolsey (D-CA)
Energy and Commerce		Fred Upton (R-MI)	Henry Waxman (D-CA)
	Commerce, Manufacturing and Trade	Mary Bono Mack (R-CA)	G. K. Butterfield (D-NC)
	Communications and Technology	Greg Walden (R-OR)	Anna Eshoo (D-CA)
	Energy and Power	Ed Whitfield (R-KY)	Bobby Rush (D-IL)
	Environment and the Economy	John Shimkus (R-IL)	Gene Green (D-TX)
	Health	Joe Pitts (R-PA)	Frank Pallone (D-NJ)
	Oversight and Investigations	Cliff Stearns (R-FL)	Diana DeGette (D-CO)
Ethics		Jo Bonner (R-AL)	Linda Sánchez (D-CA)
Financial Services		Spencer Bachus (R-AL)	Barney Frank (D-MA)
	Capital Markets and Government-Sponsored Enterprises	Scott Garrett (R-NJ)	Maxine Waters (D-CA)
	Domestic Monetary Policy and Technology	Ron Paul (R-TX)	William Clay, Jr. (D-MO)
	Financial Institutions and Consumer Credit	Shelley Moore Capito (R-WV)	Carolyn B. Maloney (D-NY)
	Insurance, Housing and Community Opportunity	Judy Biggert (R-IL)	Luis Gutierrez (D-IL)
	International Monetary Policy and Trade	Gary Miller (R-CA)	Carolyn McCarthy (D-NY)
	Oversight and Investigations	Randy Neugebauer (R-TX)	Michael Capuano (D-MA)
Foreign Affairs		Ileana Ros-Lehtinen (R-FL)	Howard Berman (D-CA)
	Africa, Global Health, and Human Rights	Chris Smith (R-NJ)	Karen Bass (D-CA)
	Asia and the Pacific	Donald A. Manzullo (R-IL)	Eni Faleomavaega (D-AS)
	Europe and Eurasia	Dan Burton (R-IN)	Gregory Meeks (D-NY)
	Middle East and South Asia	Steve Chabot (R-OH)	Gary Ackerman (D-NY)
	Oversight and Investigations	Dana Rohrabacher (R-CA)	Russ Carnahan (D-MO)
	Terrorism, Nonproliferation, and Trade	Ed Royce (R-CA)	Brad Sherman (D-CA)
	Western Hemisphere	Connie Mack IV (R-FL)	Eliot Engel (D-NY)
Homeland Security		Peter T. King (R-NY)	Bennie Thompson (D-MS)
	Border and Maritime Security	Candice Miller (R-MI)	Henry Cuellar (D-TX)
	Counterterrorism and Intelligence	Pat Meehan (R-PA)	Jackie Speier (D-CA)
	Cybersecurity, Infrastructure Protection, and Security Technologies	Dan Lungren (R-CA)	Yvette Clarke (D-NY)
	Emergency Preparedness, Response, and Communications	Gus Bilirakis (R-FL)	Laura Richardson (D-CA)
	Oversight, Investigations, and Management	Michael McCaul (R-TX)	William R. Keating (D-MA)
	Transportation Security	Mike D. Rogers (R-AL)	Sheila Jackson Lee (D-TX)
House Administration		Dan Lungren (R-CA)	Bob Brady (D-PA)
	Oversight	Phil Gingrey (R-GA)	Zoe Lofgren (D-CA)
	Elections	Gregg Harper (R-MS)	Bob Brady (D-PA)
Judiciary		Lamar S. Smith (R-TX)	John Conyers (D-MI)
	Courts, Commercial and Administrative Law	Howard Coble (R-NC)	Steve Cohen (D-TN)
	Constitution	Trent Franks (R-AZ)	Jerrold Nadler (D-NY)
	Intellectual Property, Competition, and the Internet	Bob Goodlatte (R-VA)	Mel Watt (D-NC)
	Crime, Terrorism, and Homeland Security	Jim Sensenbrenner (R-WI)	Bobby Scott (D-VA)
	Immigration Policy and Enforcement	Elton Gallegly (R-CA)	Zoe Lofgren (D-CA)
Natural Resources		Doc Hastings (R-WA)	Ed Markey (D-MA)
	Energy and Mineral Resources	Doug Lamborn (R-CO)	Rush D. Holt (D-NJ)
	Fisheries, Wildlife, Oceans and Insular Affairs	John Fleming (R-LA)	Gregorio Sablan (D-MP)
	Indian and Alaska Native Affairs	Don Young (R-AK)	Ben R. Luján (D-NM)
	National Parks, Forests and Public Lands	Rob Bishop (R-UT)	Raúl Grijalva (D-AZ)
	Water and Power	Tom McClintock (R-CA)	Grace Napolitano (D-CA)
Oversight and Government Reform		Darrell Issa (R-CA)	Elijah Cummings (D-MD)
	Federal Workforce, U.S. Postal Service and Labor Policy	Dennis A. Ross (R-FL)	Stephen Lynch (D-MA)
	Government Organization, Efficiency and Financial Management	Todd Platts (R-PA)	Ed Towns (D-NY)
	Health Care, District of Columbia, Census and the National Archives	Trey Gowdy (R-SC)	Danny K. Davis (D-IL)
	National Security, Homeland Defense and Foreign Operations	Jason Chaffetz (R-UT)	John F. Tierney (D-MA)
	Regulatory Affairs, Stimulus Oversight and Government Spending	Jim Jordan (R-OH)	Dennis Kucinich (D-OH)
	TARP, Financial Services and Bailouts of Public and Private Programs	Patrick McHenry (R-NC)	Michael Quigley (D-IL)
	Technology, Information Policy, Intergovernmental Relations and Procurement Reform	James Lankford (R-OK)	Gerry Connolly (D-VA)
Rules		David Dreier (R-CA)	Louise Slaughter (D-NY)
	Legislative and Budget Process	Pete Sessions (R-TX)	Alcee Hastings (D-FL)
	Rules and the Organization of the House	Rich Nugent (R-FL)	Jim McGovern (D-MA)
Science, Space and Technology		Ralph Hall (R-TX)	Eddie Bernice Johnson (D-TX)
	Space and Aeronautics	Steven Palazzo (R-MS)	Jerry Costello (D-IL)
	Technology and Innovation	Ben Quayle (R-AZ)	Donna Edwards (D-MD)
	Research and Science Education	Mo Brooks (R-AL)	Dan Lipinski (D-IL)
	Investigations and Oversight	Paul Broun (R-GA)	Donna Edwards (D-MD)
	Energy and Environment	Andy Harris (R-MD)	Brad Miller (D-NC)
Small Business		Sam Graves (R-MO)	Nydia Velazquez (D-NY)
	Agriculture, Energy and Trade	Scott Tipton (R-CO)	Mark Critz (D-PA)
	Healthcare and Technology	Renee Ellmers (R-NC)	Cedric Richmond (D-LA)
	Economic Growth, Tax and Capital Access	Joe Walsh (R-IL)	Kurt Schrader (D-OR)
	Contracting and Workforce	Mick Mulvaney (R-SC)	Judy Chu (D-CA)
	Investigations, Oversight and Regulations	Mike Coffman (R-CO)	Jason Altmire (D-PA)
Transportation and Infrastructure		John Mica (R-FL)	Nick Rahall (D-WV)
	Aviation	Thomas Petri (R-WI)	Jerry Costello (D-IL)
	Coast Guard and Maritime Transportation	Frank LoBiondo (R-NJ)	Rick Larsen (D-WA)
	Economic Development, Public Buildings and Emergency Management	Jeff Denham (R-CA)	Eleanor Holmes Norton (D-DC)
	Highways and Transit	John J. Duncan, Jr. (R-TN)	Peter DeFazio (D-OR)
	Railroads, Pipelines, and Hazardous Materials	Bill Shuster (R-PA)	Corrine Brown (D-FL)
	Water Resources and Environment	Bob Gibbs (R-OH)	Tim Bishop (D-NY)
Veterans’ Affairs		Jeff Miller (R-FL)	Bob Filner (D-CA)
	Disability Assistance and Memorial Affairs	Jon Runyan (R-NJ)	Jerry McNerney (D-CA)
	Economic Opportunity	Marlin Stutzman (R-IN)	Bruce Braley (D-IA)
	Health	Ann Marie Buerkle (R-NY)	Mike Michaud (D-ME)
	Oversight and Investigations	Bill Johnson (R-OH)	Joe Donnelly (D-IN)
Ways and Means		Dave Camp (R-MI)	Sander Levin (D-MI)
	Health	Wally Herger (R-CA)	Pete Stark (D-CA)
	Human Resources	Geoff Davis (R-KY)	Lloyd Doggett (D-TX)
	Oversight	Charles Boustany (R-LA)	John Lewis (D-GA)
	Select Revenue Measures	Pat Tiberi (R-OH)	Richard Neal (D-MA)
	Social Security	Sam Johnson (R-TX)	Xavier Becerra (D-CA)
	Trade	Kevin Brady (R-TX)	Jim McDermott (D-WA)

The Senate Legislative Component of The Firm

Committee		Chairman	Ranking Member
	Subcommittees
Agriculture, Nutrition and Forestry (5)		Debbie Stabenow (D-MI)	Pat Roberts (R-KS)
	Commodities, Markets, Trade and Risk Management	Ben Nelson (D-NE)	Saxby Chambliss (R-GA)
	Conservation, Forestry and Natural Resources	Michael Bennet (D-CO)	John Boozman (R-AR)
	Jobs, Rural Economic Growth and Energy Innovation	Sherrod Brown (D-OH)	John Thune (R-SD)
	Livestock, Dairy, Poultry, Marketing and Agriculture Security	Kirsten Gillibrand (D-NY)	Mike Johanns (R-NE)
	Nutrition, Specialty Crops, Food and Agricultural Research	Bob Casey (D-PA)	Richard Lugar (R-IN)
Appropriations (12)		Daniel Inouye (D-HI)	Thad Cochran (R-MS)
	Agriculture, Rural Development, Food and Drug Administration, and Related Agencies	Herb Kohl (D-WI)	Roy Blunt (R-MO)
	Commerce, Justice, Science, and Related Agencies	Barbara Mikulski (D-MD)	Kay Bailey Hutchison (R-TX)
	Defense	Daniel Inouye (D-HI)	Thad Cochran (R-MS)
	Energy and Water Development	Dianne Feinstein (D-CA)	Lamar Alexander (R-TN)
	Financial Services and General Government	Richard Durbin (D-IL)	Jerry Moran (R-KA)
	Homeland Security	Mary Landrieu (D-LA)	Dan Coats (R-IN)
	Interior, Environment, and Related Agencies	Jack Reed (D-RI)	Lisa Murkowski (R-AK)
	Labor, Health and Human Services, Education, and Related Agencies	Tom Harkin (D-IA)	Richard Shelby (R-AL)
	Legislative Branch	Ben Nelson (D-NE)	John Hoeven (R-ND)
	Military Construction, Veterans Affairs, and Related Agencies	Tim Johnson (D-SD)	Mark Kirk (R-IL)
	State, Foreign Operations, and Related Programs	Patrick Leahy (D-VT)	Lindsey Graham (R-SC)
	Transportation, Housing and Urban Development, and Related Agencies	Patty Murray (D-WA)	Susan Collins (R-ME)
Armed Services (6)		Carl Levin (D-MI)	John McCain (R-AZ)
	Airland	Joe Lieberman (I-CT)	Scott Brown (R-MA)
	Emerging Threats and Capabilities	Kay Hagan (D-NC)	Rob Portman (R-OH)
	Personnel	Jim Webb (D-VA)	Lindsey Graham (R-SC)
	Readiness and Management Support	Claire McCaskill (D-MO)	Kelly Ayotte (R-NH)
	SeaPower	Jack Reed (D-RI)	Roger Wicker (R-MS)
	Strategic Forces	Ben Nelson (D-NE)	Jeff Sessions (R-AL)
Banking, Housing, and Urban Affairs (5)		Tim Johnson (D-SD)	Richard Shelby (R-AL)
	Economic Policy	Jon Tester (D-MT)	David Vitter (R-LA)
	Financial Institutions and Consumer Protection	Sherrod Brown (D-OH)	Bob Corker (R-TN)
	Housing, Transportation, and Community Development	Robert Menendez (D-NJ)	Jim DeMint (R-SC)
	Securities, Insurance, and Investment	Jack Reed (D-RI)	Mike Crapo (R-ID)
	Security and International Trade and Finance	Mark Warner (D-VA)	Mike Johanns (R-NE)
Budget		Kent Conrad (D-ND)	Jeff Sessions (R-AL)
Commerce, Science and Transportation (7)		Jay Rockefeller (D-WV)	Kay Bailey Hutchison (R-TX)
	Aviation Operations, Safety, and Security	Maria Cantwell (D-WA)	John Thune (R-SD)
	Communications, Technology, and the Internet	John Kerry (D-MA)	Jim DeMint (R-SC)
	Competitiveness, Innovation, and Export Promotion	Amy Klobuchar (D-MN)	Roy Blunt (R-MO)
	Consumer Protection, Product Safety, and Insurance	Mark Pryor (D-AR)	Pat Toomey (R-PA)
	Oceans, Atmosphere, Fisheries, and Coast Guard	Mark Begich (D-AK)	Olympia Snowe (R-ME)
	Science and Space	Bill Nelson (D-FL)	John Boozman (R-AR)
	Surface Transportation and Merchant Marine Infrastructure, Safety, and Security	Frank Lautenberg (D-NJ)	Roger Wicker (R-MS)
Energy and Natural Resources (4)		Jeff Bingaman (D-NM)	Lisa Murkowski (R-AK)
	Energy	Maria Cantwell (D-WA)	Jim Risch (R-ID)
	National Parks	Mark Udall (D-CO)	Richard Burr (R-NC)
	Public Lands and Forests	Ron Wyden (D-OR)	John Barrasso (R-WY)
	Water and Power	Debbie Stabenow (D-MI)	Mike Lee (R-UT)
Environment and Public Works (7)		Barbara Boxer (D-CA)	Jim Inhofe (R-OK)
	Children’s Health and Environmental Responsibility	Amy Klobuchar (D-MN)	Lamar Alexander (R-TN)
	Clean Air and Nuclear Safety	Tom Carper (D-DE)	John Barrasso (R-LA)
	Green Jobs and the New Economy	Bernie Sanders (I-VT)	John Boozman (R-AR)
	Oversight	Sheldon Whitehouse (D-RI)	Mike Johanns (R-NE)
	Superfund, Toxics and Environmental Health	Frank Lautenberg (D-NJ)	Mike Crapo (R-ID)
	Transportation and Infrastructure	Max Baucus (D-MT)	David Vitter (R-LA)
	Water and Wildlife	Ben Cardin (D-MD)	Jeff Sessions (R-AL)
Finance (6)		Max Baucus (D-MT)	Orrin Hatch (R-UT)
	Energy, Natural Resources, and Infrastructure	Jeff Bingaman (D-NM)	John Cornyn (R-TX)
	Fiscal Responsibility and Economic Growth	Bill Nelson (D-FL)	Mike Crapo (R-ID)
	Health Care	Jay Rockefeller (D-WV)	Chuck Grassley (R-IA)
	International Trade, Customs, and Global Competitiveness	Ron Wyden (D-OR)	John Thune (R-SD)
	Social Security, Pensions, and Family Policy	Debbie Stabenow (D-MI)	Tom Coburn (R-OK)
	Taxation and IRS Oversight	Kent Conrad (D-ND)	Jon Kyl (R-AZ)
Foreign Relations (7)		John Kerry (D-MA)	Richard Lugar (R-IN)
	Western Hemisphere, Peace Corps and Narcotics Affairs	Robert Menendez (D-NJ)	Marco Rubio (R-FL)
	Near Eastern and South and Central Asian Affairs	Bob Casey, Jr. (D-PA)	Jim Risch (R-ID)
	African Affairs	Chris Coons (D-DE)	Johnny Isakson (R-GA)
	East Asian and Pacific Affairs	Jim Webb (D-VA)	James Inhofe (R-OK)
	International Operations and Organizations, Human Rights, Democracy and Global Women’s Issues	Barbara Boxer (D-CA)	Jim DeMint (R-SC)
	European Affairs	Jeanne Shaheen (D-NH)	John Barrasso (R-WY)
	International Development and Foreign Assistance, Economic Affairs, and International Environmental Protection	Ben Cardin (D-MD)	Bob Corker (R-TN)
Health, Education, Labor, and Pensions (3)		Tom Harkin (D-IA)	Mike Enzi (R-WY)
	Subcommittee on Children and Families	Patty Murray (D-WA)	Richard Burr (R-NC)
	Subcommittee on Employment and Workplace Safety	Barbara Mikulski (D-MD)	Johnny Isakson (R-GA)
	Subcommittee on Primary Health and Aging	Bernie Sanders (I-VT)	Rand Paul (R-KY)
Homeland Security and Governmental Affairs (5)		Joe Lieberman (ID-CT)	Susan Collins (R-ME)
	Contracting Oversight (Ad Hoc)	Claire McCaskill (D-MO)	Rob Portman (R-OH)
	Disaster Recovery and Intergovernmental Affairs (Ad Hoc)	Mark Pryor (D-AR)	Rand Paul (R-KY)
	Federal Financial Management, Government Information and International Security	Thomas Carper (D-DE)	Scott Brown (R-MA)
	Investigations (Permanent)	Carl Levin (D-MI)	Tom Coburn (R-OK)
	Oversight of Government Management, the Federal Workforce and the District of Columbia	Daniel Akaka (D-HI)	Ron Johnson (R-WI)
Judiciary (6)		Patrick Leahy (D-VT)	Chuck Grassley (R-IA)
	Administrative Oversight and the Courts	Amy Klobuchar (D-MN)	Jeff Sessions (R-AL)
	Antitrust, Competition Policy and Consumer Rights	Herb Kohl (D-WI)	Mike Lee (R-UT)
	The Constitution, Civil Rights and Human Rights	Dick Durbin (D-IL)	Lindsey Graham (R-SC)
	Crime and Terrorism	Sheldon Whitehouse (D-RI)	Jon Kyl (R-AZ)
	Immigration, Refugees and Border Security	Chuck Schumer (D-NY)	John Cornyn (R-TX)
	Privacy, Technology and the Law	Al Franken (D-MN)	Tom Coburn (R-OK)
Rules and Administration		Chuck Schumer (D-NY)	Lamar Alexander (R-TN)
Small Business and Entrepreneurship		Mary Landrieu (D-LA)	Olympia Snowe (R-ME)
Veterans’ Affairs		Patty Murray (D-WA)	Richard Burr (R-NC)

The Principal-Agent Problem

This appears to be a breakthrough in the textbook principal-agent problem. The textbook tells us that it should be the principal, in the case, the Israeli Lobby, which should bear the Asymmetric information costs of monitoring the conflict of interest on the part of it’s agent, in this case the American Political Parties.

However, in our real world example, we see the actual agency costs being borne by the agency and not the principal.

Imagine a principal hiring an agency for a stock broker, and the manager of agency keeping the principal up to date on how the personal habits/views of the agent assigned account executive might potentially negatively impact the principal.

Another example of how the Public Choice model of government agency wrecks the textbook.

Of course it’s comical to view the DoubleThink of government agency in action. We have an Israeli Lobby holding a public forum for the purpose of debunking charges of the Democrats that Republicans want to cut aid to Israel. And the the Israeli Lobby ostensibly excludes Ron Paul because he is accused of being too much like Barack Obama, the one, of course, who–as leader of the Democrats– is orchestrating the Democratic attack against Republicans in terms of accusations/warnings of aid cutting to Israel.

To me, the obvious Principal-Agent Problem is “representative democracy;” specifically, voting as a means of securing agency. The problem is particularly compounded when we factor Jesus’ Eschatological intent into the equation.

History, if there is going to be one that survives, will mock us; Zeus only had lightning bolts. Jesus had hydrogen bombs…