Who Buys the Spies? The Hidden Corporate Cash Behind America’s Out-of-Control National Surveillance State

This post first appeared at Alternet. This is the first in a new series from AlterNet’s New Economic Dialogue Project, edited by Lynn Parramore. 

Long before President Obama kicked off his 2008 campaign, many Americans took it for granted that George W. Bush’s vast, sprawling national security apparatus needed to be reined in. For Democrats, many independents and constitutional experts of various persuasions, Vice President Dick Cheney’s notorious doctrine of the “unitary executive” (which holds that the president controls the entire executive branch), was the ultimate statement of the imperial presidency. It was the royal road to easy (or no) warrants for wiretaps, sweeping assertions of the government’s right to classify information secret, and arbitrary presidential power. When Mitt Romney embraced the neoconservatives in the 2012 primaries, supporters of the president often cited the need to avoid a return to the bad old days of the Bush-Cheney-Rumsfeld National Security State as a compelling reason for favoring his reelection. Reelect President Obama, they argued, or Big Brother might be back.

But that’s not how this movie turned out: The 2012 election proved to be a post-modern thriller, in which the main characters everyone thought they knew abruptly turned into their opposites and the plot thickened just when you thought it was over.

In early June 2013, Glenn Greenwald, then of the Guardian, with an assist from journalists at The Washington Post, electrified the world with stories drawn from documents and testimony from Edward Snowden, an employee of Booz Allen Hamilton working under contract with the National Security Agency, who had fled the country. They broke the news that the US government had been collecting vast amounts of information on not only foreigners, but also American citizens. And the US had been doing this for years with the cooperation of virtually all the leading firms in telecommunications, software and high tech electronics, including Google, Apple, Microsoft, Verizon and Facebook. Sometimes the government even defrays their costs.

For most election analysts, the revelations came like a bolt from the blue, despite a whole series of warning signs. These included Obama’s rapid fire decision to step up the war in Afghanistan right after he took office, the alacrity and severity with which his administration prosecuted national security whistleblowers after promising greater transparency and the administration’s sweeping claims about the government’s right to hold citizens without trial for indefinite periods. Not to mention the Justice Department’s insistence that killing American citizens without any kind of court hearing is lawful, the efforts to prosecute journalists for simply posting links to leaked documents, the overkill that attended official responses to the Occupy movement and protests at the national party conventions, or the White House claims that press freedoms enshrined in the Bill of Rights do not cover bloggers in an era in which everyone, including The New York Times, uses blogs.

Even now, the suggestion that the Obama administration embodies a distinctively new form of extensively privatized National Security State organically linked with the famously contentious Bush-Cheney structures takes some getting used to. In particular, many readers are likely to wonder what a bitter, partisan stalemate such as the US just witnessed over raising the debt ceiling can possibly mean in a situation where Big Brother and Big Money are working hand in hand through it all.

As the storm over surveillance broke, we were completing a statistical analysis of campaign contributions in 2012, using an entirely new dataset that we constructed from the raw material provided by the Federal Election Commission and the Internal Revenue Service (which compiles contributions from so-called “527”s).  In light of what has transpired, our quantitative analysis of presidential election funding invites closer scrutiny, particularly of the finding that we had already settled upon as perhaps most important: In sharp contrast to endlessly repeated claims that big business was deeply suspicious of the president, our statistical results show that a large and powerful bloc of  “industries of the future” – telecommunications, high tech, computers and software – showed essentially equal or higher percentages of support for the president in 2012 than they did for Romney.

Though documenting the claim would take us far beyond this post, we believe that the emergence of these new industries is a key factor in transforming the old National Security State into its new, even more sinister twenty-first century model. They are not the only important influence in that transformation, of course. These would include not only 9/11, but the rapid growth of the rest of the homeland security “industry,” including private prison companies and many other non-obvious players focused on data collection in particular domains, such as the vast infrastructure built out to service and support US interventions in Iraq and Afghanistan. The policy of macroeconomic austerity, which made privatization of the old National Security State so seductively attractive to policymakers under pressure to cut government expenditures, has also played a significant role.

But the point that our findings document is perhaps most instructive of all. Many of the firms and industries at the heart of this Orwellian creation have strong ties to the Democrats. Bush and Cheney may have invented it, but national Democratic leaders are full-fledged players in this 21st century national surveillance state and the interest group pressures that now help to sustain its defenders in Washington work just as powerfully on Democrats as on Republicans.

Over the next few weeks on AlterNet, we will explore what our data show about the 2012 election. But for now, we want to focus on the telecommunications, high tech, computers and software industries, which contain many firms deeply involved in the surveillance programs.

We built two datasets for our research. One covers big business, meaning firms big enough to rank among the 350 largest on Fortune’s lists plus members of the Forbes 400 richest Americans. The second is a much larger sample containing every firm of every size, from the smallest to the largest.

We assess support by firms and their executives (our dataset is the first to integrate contributions from both, including “independent” expenditures and, of course, super pacs) in two ways: We count the percentage of firms that make any contribution at all to each candidates’ campaigns (and their party’s national committee) and we track the money split between the two candidates. For more details, see the preliminary version of our full length study, available here.

In our big sample, which pretty well approximates “business as a whole,” Obama trailed far behind Romney. Forty-one percent of all the firms (or, thanks to the Supreme Court, their executives) contributed to Romney; only 24 percent donated to Obama. But rates of contributions from big businesses were much higher for both candidates: Just over half (56 percent) contributed to Obama, while fully 76 percent donated to Romney. Our conclusion is straightforward: the traditional view that the Republicans are the party of business finds some support, but our results suggest much stronger backing for the president within big business than any account of the election suggests.

But the really significant findings emerge when you look at particular industries. Six industries where the president ran especially strongly attracted our attention: telecoms, software, web manufacturing, electronics and computers, plus the defense industry. His support in these industries ran far above his average levels of support either for business as a whole or the rest of big business. In fact, it equaled or exceeded the backing these firms afforded Romney.

In subsequent posts we will look at other industries in which Romney showed particularly strongly and consider the now red hot question of support by business groups for tea party and “main line” Republican congressional candidates. But we think this finding is the most significant of all: Firms in many of the industries directly involved in the surveillance programs were relative bastions of support for the president.

It is a sobering conclusion. At the time President Obama took office, many of his supporters expected a radical change in course on national security policy. This did not happen. For sure, limitations on some of the worst excesses were put in place, but there was no broad reversal. The secret programs of surveillance expanded and the other policies discussed above, on indefinite detention, treatment of whistleblowers and executive prerogatives relative to Congress stayed in place or broke even more radically with tradition.

Our analysis of political money in the 2012 election shines a powerful new light on the sources of this policy continuity. We do not believe that it would be impossible to strike a reasonable balance between the demands of security and freedom that accords with traditional Fourth Amendment principles and checks abuses of government surveillance rapidly and effectively. But a system dominated by firms that want to sell all your data working with a government that seems to want to collect nearly all of it through them is unlikely to produce that.

*The authors gratefully acknowledge support from the Working Group on the Political Economy of Redistribution of the Institute for New Economic Thinking for preparation of the database, but the paper represents the views of the authors, not the institutions with which they are affiliated. The entire Political Money Project database for this essay is to be freely available to the public.