Private Interest Encroachments on Public Policy-Making

One of the most disturbing and covert means by which public knowledge is being eroded is in the public policy-making environment, a space often lacking transparency. Not only have private sector companies increasingly taken on state sector roles, through a mixture of privatization and outsourcing, so too have they increasingly taken over the decision-making process itself. Commercial lobbyists, think tanks and consultants provide a stream of reports, data and policy information that feeds into government departments. Legal, accounting and other experts are seconded from the private to the public sector to develop new laws and regulations before returning to exploit such knowledge for their long-term private employers. Everywhere one looks, from defence to health, education to finance, the policy-making process has been captured by vested interests.

In chapter 14, Bong-hyun Lee outlines the ways and means by which chaebols (Korean conglomerates) have taken over multiple forms of public policy-making and discourse about the economy itself. Their dominance has come through strong influence over think tanks, state-centred policy networks, business journalism and public relations units. It is by such means that economic power has shaped discourse, which, in turn, has reshaped the economy in Korea. Consequently, its previous state-sponsored development model has been reconfigured towards a more neoliberal capitalist template, bringing instability and extreme inequalities along the way.

In chapter 15, Michael Moran and Karel Williams take a close look at the growing outsourcing industry—another means by which the private sector encroaches on the state. They ask: Why does outsourcing continue to expand despite ongoing fiascos, frauds and cost over-runs? Answers lie somewhere between public and institutional financial illiteracy, market ideology and sleight-of-hand public discourses. The combination means that outsourcers keep profiting and growing—and at a cost to the public purse.

In chapter 16, Janine Wedel takes a close look at the new American influence elites, their modes of operation, and the vehicles and structures they co-create in order to advance their individual agendas. As traditional institutions and hierarchies become more fragmented, so the new breed of influence elites and flexible networks moves in to the policy-making spaces that open up. Such elites have moved far beyond the ‘standard revolving door’ as they move effortlessly between public legislative and regulatory bodies, private contractors, think tanks, consultancies and media outlets, leveraging inside knowledge and contacts as they go. Ultimately, these same elites have powerful input into numerous policy-making areas, from defence decisions and contracts to financial regulation. Their personal gain is often the public’s loss.

In chapter 17, Colin Leys outlines a major shift in the way UK health care policy is constructed. Starting in the 1920s, health care was debated very much within a public sphere made up of the professions, universities, media and government, thus linking policy to the public interest. However, after the late 1970s, this model was slowly dismantled. Instead, management consultancies and privately funded think tanks took over the policy-coordinating function of the Department of Health. It is this transition that has aided the shift towards the privatization and marketization of the National Health Service (NHS).