One million women are sent to doctor’s offices and emergency rooms around the country for treatment every year as a result of physical abuse, making battering by spouse or loved the leading cause of injury in American women (Wrightman & Fulero, 2005). To this end, nearly fifty percent of homeless women and children entering homeless shelters are fleeing from male violence, and nearly one thousand, four hundred women (or six percent of all murder victims) who are killed by abusive partners each year (Wrightman & Fulero, 2005). Similar statistics maintain that spousal violence contributes to one forth of all reported suicide attempts by women in any given year, providing a solid evidence that abusive relations create significant psychological harm.

The Definition of Battered Woman Syndrome

Lenore Walk first coined the term “Battered Woman syndrome” in the context of a heated court decision in 1979, and continued to develop the term as classified by situational factors alone, insisting that no particular personality traits or factors predispose these women to engage in and maintain violent relationships by strongly rejecting the notion that battered women have masochistic personalities (McMahon, 1999). Although a precise definition of Battered Woman syndrome remains obscure despite growing acknowledgement by the scientific community and endorsement by the American Psychological Association, methodical studies by trained psychologists, many of which we will investigate in detail, have revealed in situations of domestic violence a typical pattern of behavioral functioning for the male batterer and his female victim in addition to typical responses on the part of this same female victim (McMahon, 1999). By breaking down the two components of this theorized psychological impairment, we first define syndrome as a collection of symptoms that occur together and characterize a particular disease (Hubble, 1999). Of great scrutiny, however, researchers question the usage of the syndrome classification because this term implies that all symptoms and responses are consistent for every woman in the applicable situation. The definition of a battered woman as determined by Hocking (1999) applies to a woman who is eighteen years of age or older, and who has been in an intimate relationship with a man who repeatedly subjects (or in the past subjected) her to forceful physical and/or psychological abuse. Bradfield (2002) suggests that Battered Woman syndrome can be defined as “a distortion of thought and perception, impaired ability to perceive and realistically appraise alternatives and delusions regarding the batterer and relationships,” although considerable debate continues on the breadth and specificity of the psychological impairment. The duality of the term Battered Woman syndrome describes both the pattern of violence within a relationship, “as well as the psychological and behavioral sequelae for the female victim”, in addition to the behavioral and psychological characteristics of the abusive male and his female victim (Hocking, 1999). Further described as a general pattern of reaction to physical and psychological abuse inflicted on a woman by her spouse, Hocking (1999) identifies those diagnosed with Battered Woman syndrome to possess a “collection of specific characteristics and effects of abuse that result in a woman’s decreased ability to respond effectively to the violence against her, and a set of particular symptoms, characteristics, and problems experienced by a woman in an ongoing physically abusive relationship with a man” (Hocking, 1999). These extreme circumstances may produce a continual state of shame, isolation, guilt, depression, passivity, learned helplessness, implications of traditional sex role attitudes, low-self esteem, and dependency, propelling a battered woman to a situation of choosing to kill herself or the batterer or else face being reduced to a psychological state in which sustained physical existence has little or any meaning or value (Ewing, 1990). Overall, the experience of a battered woman may include a history of fatal threats by her husband, prior life-threatening abusive incidents, and a belief that her husband could eventually kill her due increasing severity and frequency of the abuse, all factors which must be taken into consideration when analyzing the mental state of an individual on trial (Follingstand, Ponek, Hause, Deaton, Bulger, & Conway, 1989).

Similarity to Post Traumatic Stress Disorder (PTSD)

As the result of a perpetual state of fear produced by repeated physical abuse by one’s spouse, mental anguish may affect all aspects of human functioning in battered women, thus causing women in these circumstances to display a variety of characteristics similar to those exhibited by sufferers of Post Traumatic Stress Disorder. Hubble (1999) has concluded that individuals assessed as having Battered Woman syndrome experience fear and terror with elevated levels of anger and rage towards their abuser, in addition to impaired functioning including an inability to engage in planful behavior, which can become particularly inhibitory in determining a safe and effective escape from the abuser when conditions are favorable. This same source also focuses upon a finding that battered women may begin to lose the “assumption of invulnerability and safety that ‘things would turn out’ alright or ‘this won’t happen to me’”, concluding that such beliefs often dissipate in the onslaught of abuse and violence (Hubble, 1999). Based on this determination, it is fairly easily to understand why women who are battered respond with hypervigilance to cues of danger, noticing subtle aspects of their partner’s behavior which others would deem inconsequential and ignore, and as a result may initiate a preemptive strike to what appears to be unrelated behavior. Battered women also most often display a high tolerance for cognitive inconsistency, that is, they may express two logically inconsistent ideas but fail to comprehend the discrepancy (Wrightman & Fulero, 2005). Due to this phenomenon, many often do not assess their habitual situation and alternatives for habitation from a coherent standpoint, instead demonstrating in a diminished-responsiveness reaction focusing all energies upon survival within the relationship rather than seeking out other safe options outside of the marriage. As evidenced when Walker interviewed four hundred battered women in 1993, eighty-five percent felt they could be killed at any point in the future, but failed to dissolve the union for an unspecified reason based on diminished alternatives (Wrightman & Fulero, 2005).

A remarkable and often controversial aspect of Battered Woman syndrome which deserves considerable attention is the notion that many women are plagued by self-defeat in a theory of learned helplessness developed by Martin Seligman (1975). Seligman established in his laboratory experiments with animals that, after being exposed to variable aversive and unavoidable stimuli repeatedly in a randomized fashion, his mammalian subjects subsequently failed to utilize available opportunities to escape from the painful stimuli (McMahon, 1999). In a similar way, female humans learn that, as abuse by their husbands continue, regardless of any of her attempted actions to halt this violence, she cannot control the battering and hence, assume that she has no control over her own environment (Schuller, Wells, Rzepa, & Klippenstine, 2004). Women in these instances of psychological paralysis eventually cease to avoid the painful stimuli, believing that nothing can be done to prevent being subjected to the abuse and fail to recognize available alternative avenues for escape (Ewing, 1990).

Despite a presumption that most battered women do in fact live in this perpetual state of fear as an indication of learned helplessness, research has yielded evidence that some victims of domestic violence report a cyclic nature to the abuse, describing lulls in the destructive and painful behavior by their spouse (Schuller & Hastings, 1996). The three phases of the described cycle begin in an initial tension building stage where the wife will often perceive her husband as becoming exponentially more “edgy and more prone to react negatively to frustrations” (Wrightman & Fulero, 2005). During this phase, as described by Wrightman and Fulero (2005), a woman’s hypervigilant nature may be engaged such that she begins to anticipate her partner’s transitions of moods and his needs in the presence of small episodes of physical and verbal abuse. As a result of these more trivial abusive instances and a persistent fear of more painful episodes which will inevitably occur in the future, it appears that battered women most often kill their partners during this tension building phase. Following this apprehensive stage full of anxiety by the wife, an acute battering incident occurs and can last anywhere from two to twenty-four hours. As Wrightman and Fulero (2005) note, “anticipation of this second stage results in severe psychological stress for the battered woman; she becomes anxious, depressed, and complains of other psycho-physiological symptoms.” The final stage which often mitigates flight impulses in a battered woman occurs when the abusive husband admits that his violent reactions are unacceptable and attempts to make amends through apology and promises that he will never behave that way again. This observation to be more thoroughly addressed is forensically significant in circumstances where a time gap between an abusive threat of death or seriously bodily injury by the husband and the battered woman’s prima facie criminal act (such as killing her abusive partner in his sleep) exists. In the case of these discrepancies, a symptomatic cycle of violence provides a psychological link in the criminal proceedings for the battered woman between the two temporally distinct occurrences (McMahon, 1999).

Public Perception of Battered Women

As a result of the apparent manipulation of battered women in this incessant cycle of abuse and absolution as identified by those of us on the outside of a particular series of circumstances, the American public have adopted views and often times strong stereotypes against battered women which can hinder a fair unbiased jury composition during trial. There is a tendency to characterize the violence of the murdered husband as ensuing from difficulties within the marriage rather than resulting entirely from a flaw in the violent partner himself, thus placing a slight yet significant degree of blame upon the battered woman (Bradfield, 2002). A study conducted by Reddy et al. addresses an underlying belief that the battered woman is somehow responsible for her continued abuse because she places herself repeatedly in a situation where she has prior knowledge that she will continued to be beaten (Bradfield, 2002). Society’s expectations assume that battered women should and will leave violent relationships prior to the actual murder of a spouse, and when this does not occur, individuals question the motives and rationale of the women in these relationships. Therefore, although the accused may inform a jury fully of her reasons for remaining with her husband throughout the battering cycles, a common sense understanding by jury members may lead them to question the severity of her abuse claims. Additionally, according to Bradfield (2002), these perceptions are further “reinforced by the dominant societal and legal conception of domestic violence that focuses on isolated and discrete episodes of violence which facilitates the position that leaving the relationship is the sole appropriate form of self-assertion” (Bradfield, 2002). Several misconceptions continue to circulate throughout American courtrooms particularly that battered women provoke their abuse, remain in these relationship because they enjoy the physical abuse aspect, or that violence fulfills some dark and deep-seated need within each partner (Spring & Winston, 1994), many of which could bear considerable influence on the decision of a jury during trial.

Although the scientific community acknowledges these assumptions of pleasure derived from physical violence and verbal ridicule as completely inaccurate, one must question what distinguishes a battered woman from other wives who are not physically, emotionally, or psychologically abused, and also the factors which differentiate battered women who kill from those who do not. Empirical research conducted by Hocking (1999) has revealed discrepancies between battered wives and those engaged in more healthy forms of marriage, stating that battered women are “over-socialized, submissive, dependent, conforming and self-less, cautious, controlling, superstitious, submissive, anxious,” and possess poor coping skills. Bradfield (2002) further explains that women in violent dyads are more emotionally dependent on their husbands than those in nonviolent dyads, have lower self-image than those in nonviolent unions, and tend to perceive their husbands more positively than women who are in nonviolent marriages (Anson & Sagy, 1995). On measures of marital and gender social organizational attitudes as assessed by Warren and Lanning (1992), it was determined that women in violent relationships responded significantly differently to four out of twelve statements concerning the division of labor and authority within the family than those in non-violent unions. According to this study, more women in the violent condition agreed that their husbands had the right to decide about intercourse, when she is able to leave the home for an outing, and that assertive women harm the dynamics of their families (Anson & Sagy, 1995). In terms of maintaining the relationship, battered women, it seems are more emotionally dependent on their husbands; “when their husbands go out, they feel, as may have been expected, more relieved and relaxed; they also, however, reported more frequent feelings of being angry, sad, and lonely (Anson & Sagy, 1995). Findings from this research study contradict a proposition that battered women have lowered self-esteem in that, it was verified that the self-image of women in violent marriages were quite similar to those in the non-violent condition, although the battered women were more nervous and less happy compared to their peers as reported by Walker (1984). Women in violent relationships, moreover, tend to perceive violence as commonplace, justifying their husbands actions with positive emotions, including love, and in many cases, actually believe that they bring their fate upon themselves. It is still a matter of debate whether these perceptions are a result of early socialization or perhaps are developed as a reaction to the violent martial experience (Anson & Sagy, 1995).

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Lobbying can be generally defined as the expenditure of resources by a firm or group of firms in order to secure a favorable political or legal environment for their activities. Though lobbying actions are most frequently geared toward achieving preferable domestic policies, larger governments with regional or international influence can be petitioned for favorable foreign policies. Domestic interest groups attempt to gain, often indirectly, economic benefits through a government’s exclusive diplomatic channels. Governments often hold a great deal of information unknown to the private sector, as well as direct contacts with officials and lawmakers of foreign countries. As monopolists of force, states also reserve the threat of war as a means to their ends. Economic interest groups can, instead of expending resources on adjusting their business to market conditions, expend those resources on adjusting market conditions to their business (“rent-seeking”).

For markets, lobbying has profound implications. The law has nearly limitless potential to interfere in the economy. Where there is this capability, laws become a commodity to be bought and sold. A fundamental error to make is to think that politics are non-quantifiable and non-economic. To quite the contrary, political structures are simply markets in which the rules are different (albeit radically at times). “Political entrepreneurship” becomes as much a skill as innovation in one’s industry: if the principal goal is profit for a group of people, then a dollar earned productively or coercively is, other things equal, the same.

The United States is the prime example of a powerful nation whose foreign dealings and economic policies are highly responsive to special interests. Both the structures of the electoral system and the government’s coercive powers grant a significant level of policymaking access to private organizations. A thorough examination of the government’s scope of powers, the structure of policymaking institutions, and the long-term trend of increasing reported lobbying expenditure reveals considerable evidence that political proficiency is part of an essential set of skills for the modern U.S. multinational corporation.

A Model of Multinationals and Lobbying

The political sphere is even more immensely complicated in the absence of the premises upon which the free market functions. Political structures frequently alienate the agent from the results of his actions (or inaction) in some way. The chief structure that causes this alienation is bureaucracy, partly via “diffusion of responsibility” effect. While this phenomenon occurs to some degree in free markets with large firms,[2] it is less of a problem, because productive deficiencies are more quickly answered by declines in profits and labor market adjustments. The obstacle is most often described as the principal-agent problem, which is especially pronounced in government. Whereas in the private sector, the “principal” at hand is concerned with easily quantifiable profits, the objectives of government institutions are much more specific, varied, and difficult to measure. On one hand, firms are naturally controlled by productivity, and in turn, profits; on the other, governments are validated simply by force and by the cost inefficiency of rapid change (revolution). Though democracies require input from the entire population, their input is channeled through a central decision-making and enforcement process; this should not be mistaken for the kind of integration of dispersed information that markets have. The end-state of a market is the product of an aggregation of many individuals associating in ways that benefit them individually, each person possessing a small amount of resources (relative to the rest of the economy). Alternatively, the end-state of government is the product of a pre-established institutional structure (e.g., a constitution) determining how to allocate a large amount of resources.
That the agents involved in government seek the maximization of their individual utility should not be ignored. In fact, this is the core assumption that does not differ between private and public activity. The agent does not change; only his constraints do. Though this view may appear to some as cynical, the basic intuition behind it is that while the costs of some kinds of choices may differs, an agent’s preferences generally do not change upon attaining public office. As might be argued, a sense of duty or responsibility (conscience?) may develop, altering the agent’s utility function. Nevertheless, it is clearly too limited to overcome the bureaucratic risk-reward gap.

For purposes of simplicity, we will assume that firms as a whole attempt to maximize their profits, without the risk of individual actors in the firm placing their own individual benefit above the firm’s profit (e.g. no corrupt CEOs trying to swindle shareholders). The objective of this investigation is to examine the specific nature of the relationship between rational market actors and government institutions.
It was stated earlier that laws are a commodity to be bought and sold. Beyond mere metaphor, we can construct a model that recognizes that political institutions are entities that possess the ability to, ceteris paribus, exogenously impose any desired condition of operation on market processes. Because these institutions are operated by individuals who are factually no different than market actors, the result is that these individuals possess some degree of that exogenous power for use at their own discretion. They are liable for what they do with it, but not completely. It is this discrepancy that subjects policymaking to a certain level of autonomy, and thus subjects it to market forces. From these assumptions, we can model the lobby-subsidy process.

The interaction between firms and the government can be summarized by the following model, beginning with a firm’s basic profit function:

p_d = p_m + s – E_L                                                                                                    (1)

A domestic firm’s profit, p_d, is a linear function of the firm’s exogenous market profit (p_m), plus subsidies (s), minus lobbying expenditure (E_L). Prior to any government assistance, a firm makes a certain level of profit; they can then receive more profits via subsidy from the government, but must count their expenditure in attaining those subsidies against them. E_L is not only meant to contain formalized lobbying spending conducted through institutions established for that purpose, but any expenditure of resources on attempting to influence political outcomes (the primary means being appeals to officeholders’ individual interests). E_L includes election campaign contributions to candidates who promise to reflect their contributors’ interests and any promises of special employment or other benefits after a policymaker’s term in office. It also consists of the payment of lawyers to assist policymakers in drafting the language of policies and experts to assist in implementation.

Next, we must consider the interests of the policymaker, and his obligation to the public:

U_g = rE_L – f(C_p)^a                                                                                                    (2)

The government policymaker’s utility, U_g, is the difference between the benefits received from private interests and a penalty caused by institutional mechanisms for public accountability. The first component is the product of some proportion r times the firm’s lobbying expenditure E_L, representing the amount of E_L that government agents “capture” for their own gain. Lower values for r tend to indicate more reliable institutional structures separating private from public interests. If r had a value of one, lobbying expenditure would essentially be direct bribery in exchange for arbitrary decree. The more that a firm has to spend in figuring out how the law works, what kind of law would benefit them the most, and other institutional intricacies, the lower r is.

The second component constitutes the role of the public in holding policymakers accountable for their decisions. It is the product of some proportion f times the perceived cost (to the public) of a policy, raised to an exponent a. a can be taken to represent the level of public attentiveness and responsiveness to how their tax dollars are used, and it is assumed that a ≥ 1 (if it were otherwise, the public would penalize the government marginally less for each extra dollar it spends- an absurd outcome). f represents the institutional manifestation of the public’s attitude: the higher it is, the more sensitive policymaking must be to public opinion. We also constrain this parameter between 0 and 1, for practical purposes.

Thus far, we only defined public opinion as a function of the perceived cost of a subsidy, which is actually defined by the actual cost of the subsidy minus some error:

C_p = C_s – u_i                                                                                                                                                (3)

Moreover, the cost of a subsidy is the quotient of the subsidy’s value over some efficiency proportion F > 0:

s = F*Cs                                                                                                                (4)

Thus, substituting (4) into (3) and then into (2), we have

U_g = rE_L – f(S/F – u_i)^a                                                                                             (5)

F represents how cost-effectively the government can perform the policy at hand. u_i indicates the level of misinformation the public has about the cost of a subsidy.

Taking the first-order conditions of each equation (i.e. optimizing firm profits and government utility with respect to the choice variables, s and E_L), we attain an equilibrium level of s:

s = ((r*F/a*f)^1/(a-1) + ui)*F                                                                                      (6)

From this, general intuition can be drawn about how each parameter affects the equilibrium subsidy value- in more plain language, how institutional, economic, and political environments determine the incentive structure for policymakers’ behavior. In short, differentiating with respect to each parameter individually yields the following results: greater government efficiency increases subsidies (dF/ds > 0); structural corruption increases s (dr/ds > 0); misinformation increases s (du_i/ds > 0); Public responsiveness decreases s (da/ds < 0); and strong public institutions decrease s (df/ds < 0).

The model operates on a short-run, ad hoc basis; the equilibrium value reflects optimization from a single firm’s perspective at a particular point in time. Appropriately, the parameters differ depending on the specific firm’s (or industry’s) case, the institutional nature of the policy in question, the public attitude toward the symbolic issues, etc. For the most part, this is concordant with the reality of the assumed profit-maximizing firms: they are willing to gain at anyone else’s expense. Overall, the model given above is not intended to deal with quantitative specifics, but to create an overarching cost-benefit analysis of one method of altering a firm’s profits: exploiting politics. It is sufficiently abstract to accommodate any form of government which allows for some degree of private property, whether it is a dictatorship or a modern liberal democracy; the parameters are what change, but not the logic.

Symbolic vs. Instrumental Policy as tools for economic gain

With quantitative reasoning in mind, we can begin to examine the qualitative aspects of the lobby-subsidy process. The distinction between “symbolic” and “instrumental” policy, a concept outlined by Murray Edelman in The Symbolic Uses of Politics (1964), is critical to fully understanding how MNCs (or any special interests, for that matter) can successfully have their private interests supported by government policies, even when those policies are detrimental to the public as a whole. He discusses the reality of the gap between the symbols invoked when policy decisions are being made and the actual instrumental, material status of such policies (i.e. what kinds of resource transfers the policy entails). These symbols are aimed at triggering conditioned responses, and are meant to be a substitute for the actual things they represent. For example, “the elimination of poverty” is supposed to trigger a positive response in favor of a policy, but its implementation may in fact be a tax break for the wealthy.

In accordance with that idea, important lobbying strategy lies in promoting favorable ideas to support firm or industry-specific goals. The aim is to achieve ideological or empirical consensus in policymakers and in, more importantly, the public. While some expenditure for this objective is through private organizations, the end result when it is successful is a favorable alteration of the law.[3]

Besides the standard range of direct government benefits which multinational corporations seek for their domestic markets (direct subsidies, tax breaks, etc.), MNCs often pursue policies that positively affect their standing as international companies (or negatively affect their competitors’). This could mean, for example, arguing for a tariff that may not be necessarily to inhibit a rival’s trade, but to make its production inputs more expensive if it depends heavily on outsourced components. MNCs can lobby for direct negotiations or even the use of force between its home country and a potential host country in order to increase its stock of investment abroad. These are but two examples of the many ways in which MNCs can attain indirect subsidies, whose legislative elements frequently obscure their ultimate beneficiaries who, in public discussion, are supplanted by symbolic language.

U.S. MNC Lobbying in the 90s to the Present

American institutions have a long history of lobbying, beginning in essence with the first amendment of the Constitution: “[Congress shall make no law abridging] the right of the people peaceably to assemble, and to petition the government for a redress of grievances.” Increasing demand for lobbyists in the late 1980s led to a growth in popularity of the practice, and the “Washington Game” began to perpetuate itself. The high demand also changed the traditional viewpoint that it was inappropriate for former elected officials to become lobbyists. Since 1998, 43 percent of the 198 members of Congress who are no longer in any elected office have registered as lobbyists at least once.[4] The overall result of this evolution is the ever-increasing presence of private money circulating in public affairs. The bottom line is that to the American politician, money matters greatly. In the 2002 midterm elections, candidates who spent more money than their opponents won 95% of all contested House seats and 75% of all Senate seats.[5]

In context of the model provided, there are many examples of the significant influence of multinational corporations on economic policy. America, despite being considered the most laissez-faire major power, is a massive provider of corporate welfare. A symbolic and instrumental assessment of most recent U.S. policy relating to multinationals bears very strong explanatory power. Partisan politics serve as a major front for symbolic stratification of policy. Generally, at least some semblance of connection between the larger stated ideological issues and the actual policies must exist. Though members of both the Democrat and Republican parties regardless receive immense contributions from multinationals, the prime political actors on behalf of large MNCs usually consist of Republicans, likely due to their ideological platforms which usually involve deregulation, trade liberalization, belief in the strength of entrepreneurship, and so forth. These beliefs, ironically, are used as the symbols to mask the economic interventionism of subsidizing large MNCs.

Given the general claims stated up to this point, the next inquiry must be into their actual historical relevance: what contemporary examples are there of MNCs demonstrating a palpable influence on U.S. policy? The difficulty of finding information on the topic is testament to the transparency that MNCs often enjoy in their lobbying activities, at least in regards to the general public. To discover the appropriate connections, one must integrate diffuse pieces of information from diverse sources in order to draw the connection between a particular firm’s action and how a government policy was determined. Furthermore, lobbying disclosure law is only relatively new, with the Lobbying Disclosure Act having been only passed in 1995. Besides the fact that lobbying activities falling under the guidelines of the law were sometimes underreported (especially during the first few years), there are still many methods of lobbying that have no legal disclosure requirements. These include “revolving door” offers, personal favors, insider information, and other transactions that frequently have no official paper trail. Discovering these obscure relationships beyond mere speculation is a matter of intensive research, including investigative reporting across many sources that only provide small amounts of information individually. For now, we will briefly explore two major and well-known contemporary examples of multinational industries that engage in and profit from abundant political activity: pharmaceuticals and petroleum.

The pharmaceuticals and health products industry constituted the largest portion of reported political contributions in 1998-2006, spending over $1 million. Their critical policy objectives focus on international recognition of “intellectual property” rights to their drugs, in order to undermine cheaper competitive drugs which cut into their market shares, and the elimination of price controls caused by growing desires for healthcare guarantees.[6]

The pharmaceutical industry deals primarily with products that prolong or improve the bodily well-being of humans. In most societies, the act of “saving lives” is a moral priority, or at least a noble deed. It is no surprise, then, that all related policies are couched in strongly symbolic terms. Their public claims are broadly reflected by statements such as “without [assistance on this issue] from government, expensive research on important drugs will stop and many life-saving implements will not be available.”

The industry’s influence on international trade is very palpable and significant. Its trade association, Pharmaceutical Research and Manufacturers of America (PhRMA) includes Pfizer Inc., GlaxoSmithKline Plc, Merck & Co Inc., primarily functioning as a means to increase transparency of individual companies’ political influence. PhRMA has filed 59 lobbying reports concerning the Office of the U.S. Trade Representative, more than any other organization historically. Drafts of the Dominican Republic-Central American Free Trade Agreement echo the pharmaceutical industry’s sentiments about price controls and intellectual property. Under its provisions, member nations will be required to comply with deregulated pricing and international patent laws. An examination of the voting record for implementing DR-CAFTA demonstrates almost unanimous votes along party lines: only 15 Democrats voted for the measure, and only 27 Republicans voted against it.[7] Furthermore, in light of CAFTA in 2005, Guatemala was pressured to repeal a law that would allow for increased marketing of generic drugs as long as the drugs were demonstrated to behave like approved drugs. The U.S. ambassador to Guatemala issued presented an ultimatum: Guatemala had to change its law to provide the clinical study data exclusivity mandated by CAFTA, or the U.S. Congress would not allow them membership.[8]

The oil industry, especially in extraction and transportation, is the beneficiary of a large amount of both direct and indirect subsidies. Two of the most significant (relating to their international position) are in the use of government resources in protecting their assets abroad as well as expanding their potential asset base, and in their lack of responsibility for environmental externalities caused by the consumption of fossil fuels.

The physical security of oil drills, pipelines, and shipping lanes constitutes billions of dollars of U.S. government services. Friendly diplomatic relations must be maintained with major exporter countries, especially those with U.S.-owned holdings. Likewise, military force must be readily available to combat any attempt to seize or otherwise disrupt oil supplies by foreign aggressors. Besides maintaining existing American assets and relationships, the government has also engaged in policies in seeking out new sources of oil. One need only imagine a world that did not need petroleum, and aptly ask: “would our foreign policy be the same if that were the case?” It is misleading, of course, to characterize the government’s heavy interest in maintaining and expanding oil supplies as only a resource transfer to large oil companies, as much income in America is authentically dependent on the energy generated by oil. Nonetheless, it is still a subsidy that discourages substitutes and conservation.

It is no surprise that Republicans advocate the very symbolic policy goal of an aggressive outward foreign policy. According to the Center for Reponsive Politics, in the 2006 election cycle, Republicans received 84% of all campaign contributions from the oil industry. While oil interests may not be the sole explanation of their foreign policy goals, they stand as part of a wider variety of interests that share common goals, such as defense contractors. A glimpse at the news today reveals that the price of oil per gallon to the customer is as much a leading economic statistic as the stock indexes. The “price at the pump” has become a highly symbolic issue, and many Americans often complain that gas prices have been allowed to become too high and that something ought to be done about it. To some, this means moving to alternative fuel sources. To oil companies, it is an opportunity to continue arguing for the necessity of oil on the basis of economic growth, appealing to the average American’s lifestyle.

The issue of global climate change has particularly in the last decade led to political gamesmanship from major corporate interests in the oil industry. The Kyoto protocols, negotiated and signed by the Clinton administration in 1997, were drafted with the objective of “stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.”[9] This would entail the reduction of emissions, either via increased automobile efficiency among other conservation measures, or even possibly the development of permanent alternative fuel sources- a clear threat to the oil industry’s many sunken capital costs. Exxon-Mobil, the largest oil company in the world and contributor of the greatest amount of U.S. lobbying dollars in its industry, has undertaken a strong anti-global-warming campaign, funding private think-tanks to promote uncertainty over global warming and the economic danger of environmental regulations. Not surprisingly, their business model is suited primarily for research and development in oil extraction and refinement, and they hold several oil assets abroad, including major pipelines in Siberia and Africa.

Oil companies like Exxon-Mobil had quickly realized that they needed to win the war against the Kyoto protocols and all other climate control policies, and doing so would require the scientific agreement of the public, and in turn Congress. In 1998, the New York Times revealed a leaked American Petroleum Institute (an organization whose membership includes Exxon-Mobil) memo aimed at addressing the ubiquitous presence of global climate concerns. Its proposed organization, the Global Climate Science Data Center, would serve several useful functions, among them, “identifying and establishing cooperative relationships with all major scientists whose research in this field supports our position,” and “developing opportunities to maximize the impact of scientific views consistent with ours with Congress, the media and other key audiences.” It is quite clear that no matter where the evidence lies for global warming phenomena, money is pushed into politics in a manner concurrent with partisanship over science. [10]

In Opensecrets.org’s special election report, “President Bush’s First 100 Days: A Look at How the Special Interests Have Fared,” the section subtitled “Energy” begins bluntly: “If there were any doubt that President Bush and Vice President Cheney, two former oil executives, would be sympathetic to the interests of energy companies, it has been put to rest in the first 100 days of the new administration.”[11] Evidence of a “revolving door”-style administration is abundant with respect to the petroleum industry. In 2001, Exxon-Mobil lobbyist Randy Randol sent a memo to the White House requesting that Intergovernmental Panel on Climate Change (IPCC) chairman Robert Watson resign. Though he did not resign, his reelection was blocked one year later.[12] In 2003, the Bush administration officially denounced the Kyoto protocols. Presently, the administration shows few signs of substantively addressing the global warming issue, and the “lame-duck” period will likely prolong that trend until 2009.

Conclusions

The omnipresence of private interests bearing significant influence on governmental policy is not unknown or surprising to most people. However, an understanding of the process of how these interests come to affect government policies is important for the MNC strategy theorist, for the foundations that underlie it must be considered as new developments in globalization world governance begin to surface. Greater empirical study of the effects of political dollars on profits can yield great insight into the causes MNC decision-making, along with possible reforms to counteract the exploitation of political systems for subsidies, but it is ultimately limited by the obscure nature of the interpersonal dealings and complexity of publicized procedures that constitute the lobbying-subsidy process. More exploration of the broad spectrum of powers such as multilateral institutions that can be tapped for MNC benefit can also explain how government intervention is still not out of the question in a rapidly globalizing economy.

[1] Lobbying Database, Center for Responsive Politics. http://www.opensecrets.org/lobbyists/index.asp (Accessed April 3, 2007)

[2] These large firms, because of their size, require bureaucracy-like institutions in order to effectively manage their vast resources.

[3] This is a quasi-political function of corporations that is captured exogenously in u_i in order to keep the lobbying-subsidy model simple.

[4] “Lobbying in the United States.” Wikipedia. http://en.wikipedia.org/wiki/Lobbying_in_the_United_States

[5] Compiled from Opensecrets.org.

[6] “Pharmaceutical Industry Spent $800M on Lobbying Over 7 Years, Report States.” Medical News Today. http://www.medicalnewstoday.com/medicalnews.php?newsid=27125

[7] “The U.S. Congress Votes Database.” The Washington Post. http://projects.washingtonpost.com/congress/109/house/1/votes/443/

[8] “CAFTA, Data Protection and Generic Drugs.” Embassy of the United States: Guatemala. http://guatemala.usembassy.gov/factsheetcaftagenerics.html

[9] The United Nations Framework Convention on Climate Change. http://unfccc.int/essential_background/convention/background/items/1353.php.

[10] Global Climate Science Communications: Action Plan. The American Petroleum Institute. http://www.euronet.nl/users/e_wesker/ew@shell/API-prop.html

[11]“President Bush’s First 100 Days: A Look at How the Special Interests Have Fared,” Center for Responsive Politics. http://www.opensecrets.org/bush/100days/energy.asp

[12] Mooney, Chris. “Some Like it Hot.” Mother Jones. http://www.motherjones.com/news/feature/2005/05/some_like_it_hot.html

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Small Claims Court Procedures

The Coral Gables District Court (CGDC) – located at 3100 Ponce De Leon Boulevard in a relatively rich neighborhood- serves as a court for hearing small claims ($5,000 or less), county civil damages, landlord/tenant eviction, circuit civil, and family court cases for Miami-Dade County. The court only has two of its three presiding judges; the third is currently left to a cycle of temporary judges due to the elevation of two other judges to federal and state positions. I attended a small-claims pretrial session which scheduled several cases over a two-hour period. There were a whopping 96 cases on the docket to be heard by a temporary substitute for the missing judges. At 2:00, the clerk began a roll-call of the cases to be reviewed that session, announcing the parties in the case (Litigant vs. Defendant) and whether the defendant had been served the suit (“pending service”). If the defendant was not pending service and did not postpone the pretrial hearing, his absence resulted in a “default,” the plaintiff submitting a final judgment to be signed by the judge. After roll call, the bailiff summoned the judge to the courtroom, and the hearings began. As explained to me by a another bailiff, pre-trial sessions in the CGDC have a few time-saving functions: officially determining whether the case will go to trial, discussing accepted matters of fact, and even providing a time and place on record to pass on paperwork. If the parties had not worked out a settlement by the time of the pretrial, the judge would either refer both parties to mediation (or arbitration), or hear the nature of the case and determine if it was to move to trial.

Immediately noticeable in the process is the resolution of cases at the first step: the roll call. In the 96 cases called, over half of them resulted in defendant default. The impersonality of the suits (a company suing a consumer for “contract & indebtedness”) almost precludes any urge on part of the defense to even show up to court to face a well-equipped “repeat player,” particularly if there is no defense to give for unpaid debts. For most who default, showing up to court would mean missing a day of work just to receive the inevitable final judgment, the binding order to pay a debt (with interest if not paid immediately). The remainder that did not move on to the next step were defendants yet to be served the lawsuit.

In approximately one-fifth of the cases called, a defendant was present to proceed with the pretrial hearing. In only five of these, however, were words unrelated to the settlement paperwork being handed in exchanged between the judge and the relevant parties. In the others, the disputes had already been settled in private conference or mediation. As a local attorney explained, “on average only about 10%” of the cases that complete a pretrial hearing proceed to trial. To be more precise, only 1 of the 96 disputes ended in a scheduled trial. Clearly, the outcomes demonstrated the ability of the court to come to resolution of disputes effectively.

According to G. Alan Tarr, the purpose of a pretrial conference is for the judge and attorney to address the points of agreement and disputed issues. This, of course, assumes that the case will even need to see trial. Many judges encourage and aggressively pursue settlement to avoid trial by referring the involved parties to alternative dispute resolution (mediation, arbitration) and even function in a way as mediators themselves during pretrial.[1] All of these are common practice in the CGDC; the courthouse even provides its own in-staff mediator for an hourly fee. The low ratio of non-defaulted cases that went to trial can be attributed to this tendency.

Repeat Players and One Shotters

The majority of plaintiffs were the court’s RPs (“repeat players”): insurance companies, credit bureaus, banks, and other contract-related businesses, represented by a single attorney over several cases. Likewise, because the court only deals with claims up to $5,000, most of the defendants (that did not default) were OS (“one-shotters”) and self-represented. One significant plaintiff was Asset Acceptance, LLC, a company that “buys” debt from other repeat players, and hires or sends its own lawyers to sue in court for collection of these debts.

Legal scholar Marc Galanter (creator of the phrases “repeat player” and “one-shotter”) suggests that an RP will wield significantly large edges over an OS. “… Repeat players can structure the law at the outset… [They] usually have hired or retained lawyers, and so their start-up costs of litigating are minimal.” A credit card company, for example, will offer a consumer a contract and that contract is seldom renegotiated (or renegotiable), giving that company a distinct advantage over delinquent debtors. These types of clear legal obligations explain the large number of defendant resignation leading to defaults, both in the CGDC and nationally. The repeat players are also involved in litigation so often that they can dedicate resources to minimize the costs of taking small claims to court.[2] In recent years, debt-collection companies such as Asset Acceptance have begun to dominate the RP versus OS process, their revenue almost entirely generated by lawsuits. This requires them to maintain the capacity to litigate successfully at a low cost; in 2004, Asset’s expenses were 2 cents per dollar of debt collected.[3]

Because few of the cases required judge-party interaction beyond the transfer of paperwork, there was only minimal evidence to gauge the Judge’s courtroom behavior. To place her actions in context, due to the missing judge, the CDGC’s small-claims division was backlogged with work and was under pressure to finish its weekly caseload. In the single case that moved to trial, she grew impatient and brusque with the informally-dressed plaintiff while he was explaining the disputed issue at hand. As he approached the bench to show her a document, Schwartz immediately rebuffed him and told him to return to the podium, promptly informing him, “this is not a trial.” She inquired into the reasons as to why the plaintiff refused to accept a settlement, and he contended that the invoice of the charge he owed was filed to his name instead of his company’s name, a reason she likely perceived to be an inane distinction when she asked, “But do you have the money to pay him?” the plaintiff did not give a direct answer, insisting on his invoice claim and a movement to trial. Schwartz, not appearing very pleased with him, curtly replied, “This is too much for me to try today, so I’m not going to do it,” and told them to schedule a trial with her clerk. Clearly, the judge was actively participating by pursuing a settlement between the two parties by referring them to mediation, probing into the failure to settle, and even becoming agitated at his insistence on trial. Though this exchange appeared to be straight from “Judge Judy,” it did not mean that she failed to move through the few other cases quickly, professionally, and effectively without occasion. It is also notable that the court staff was very helpful in assisting my research, and, despite the work to be done, I was permitted to speak with the Judge in her chambers. Overall, the court was effective in its business but informal in its communication, as demonstrated by the interpersonal interaction in the courtroom between attorneys and staff, and the general willingness to help the petty research of an undergraduate student.

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