The U.S. Government is the best government money can buy

“I’m a senator, I gotta raise $10,000 a day every day I’m in Washington. I ain’t getting it in South Central, I’m gettin it in Beverly Hills. So I’m votin’ for them in the senate the way they want me too.” This is a quote from one of my accidental favorite movies, Bullworth, the 1998 movie starring Warren Beatty, Halle Berry — and of course the flawless Christine Baranski — about a suicidal senator who puts a hit on himself. After he puts a hit on himself he decides he has nothing to lose but to tell it as he sees it. This movie is 14 years-old and part of this monologue is as pertinent today as it was then. Here is one of the timeless quotes after I have edited out the expletives, Warren Beatty as Senator Bullworth, “The rich is getting richer and richer and richer while the middle class is getting more poor.”

The 2011 U.S. tax code is just over 72,500 pages. By the way, the U.S. tax code increased 852 pages from 2010. You might wonder why this is, and I hope to be able to offer some insight. The reason the tax code is 72,500 pages and climbing is because every paragraph, sentence, word and punctuation has been bought and paid for by some lobbying group. You see, the money is the problem not the solution. An average U.S. Senate race is $8.5 million. A senator, once elected, has to raise almost $109,000 a month for their reelection campaign. A representative has to raise $58,300 a month for their reelection campaign. Where do they get the money? They get it from people that want the access, but more importantly, they get it from people who want the vote. The tax code is 72,500 pages long because it is for sale. It is the goose that continues to lay the golden egg. No one is going to kill it, but they will feed and water it until it just blows up.

Sadly, I believe we are closer to seeing it blow up than we think.

With the presidential election in full swing, I have some appalling statistics. This information is from January 2011 through the end of July 2012. President Obama, the DNC and his Super PACs have raised $587.7 million and spent $502.8 million. Gov. Romney, the RNC and his Super PAC have raised $524.2 million and spent $395.1 million. This left President Obama with cash on hand of $131.2 million and Romney with $197.1 million. It is going to get interesting people, but I am fascinated to see who will own the election. All of this money is an investment. It is not a donation.

So, how can we be so awash with money that we can effortlessly spend  to buy and influence an election and yet be in such an economic position? Our country is more divided now than during the Civil War. The most intense arguments I have had with my partner are about politics and we essentially agree 90 percent. Our country is torn in two directions because of “financial conflicts of donor interests.” As the fictional Senator Bullworth said, “We got public schools that are nightmares. We got a Congress that ain’t got a clue. We got kids with submachine guns. We got militias throwing bombs. We got Bill just gettin all weepy. We got Newt blaming teenage moms. We got factories closing down. Where the hell did all the good jobs go? Well, I’ll tell you where they went. My contributors make more profits makin’, makin’, makin’, hirin’ kids in Mexico.” This was said 14 years ago in a satirical movie about our political system and yet nothing has changed.

Money is the turbo charger of the world. I have a friend that wisely explained to me that people do not change. And certainly money does not change people; money just super charges their personality. He continued, “If a guy is a bloviating, arrogant idiot, once he inherits some money, he becomes an insufferable bloviating, arrogant idiot with money. But once a great guy inherits some money, he becomes a generous magnanimous great guy.” Our country has been turbo-charged into political schizophrenia. Our only hope is to stop contributing to political causes as it seems to only encourage them. We can vote the bums out, and by bums I mean any incumbent. Our country is the envy of the world in spite of all our problems, ironically our problems are due to our success and in turn our money. How to stop the madness you ask?

1. Political campaign budgets will be set per capita. The federal and state governments will simply pay for the election. The more people in the state, the more money they get. Yes California gets more money than Delaware.
2. No private contributions allowed. Candidates may not receive contributions in cash nor in-kind. So, sorry George Clooney, you will no longer be able to charge for a dinner party at your home.
3. Media outlets may only charge 50 percent of the actual market value of the time. This ought to stop the media from being shallow and whipping up the electorate into a dazed and confused frenzy. Once the media sees the spending is limited and barely profitable, we can only hope they start reporting on the issues versus how much Ann Romney’s blouse cost and Michelle Obama’s arms.
4. Term Limits! The president and senators get two terms, representatives get six terms.
5. The most important, stop donating money to political campaigns!

Whoever said, “When someone says it’s not the money, it’s the principle of the thing. It’s the money,” was one smart independent person.

The opinions and recommendations expressed herein are those of Mr. Garrido and do not necessarily reflect those of the firm and are subject to change without notice. This information is not to be construed as an offer to sell or the solicitation of an offer to buy any securities. The information contained herein has been derived from sources believed to be reliable but is not guaranteed as to accuracy and does not purport to be a complete analysis of the security, company or industry involved.