A fundamental misunderstanding about how politics interacts with money

Over in the US - and undoubtedly soon to be repeated here - a call for the trillions being splashed around by government to be used to fundamentally reshape the economy not just to dig said economy out of its current hole:

In this role, the NIA will act directly inside financial markets as a lender, guarantor, venture capitalist, and investment manager. It will combine modern financial engineering with the federal government’s unique scale advantages to boost supply of urgently needed public goods and services: clean energy, high-speed rail and broadband networks, affordable housing, tech startup incubators, and so on. This will create well-paying jobs, increase productivity, reduce inequality, and strengthen communities across America. Importantly, it will do so in partnership with private institutional investors—pension funds, insurance companies, university endowments, etc.—to whom it will offer an attractive opportunity to invest in “safe” assets with higher yields. In this model of public-private partnership, the public leads and private capital follows.

To prevent this partnership from being abused and corrupted by political incumbents and powerful private interests, it will be critical to subject the NIA to multiple layers of public oversight and accountability. Its organizational structure will need to guarantee sufficient insulation from political meddling…

The thought that such political control of investment might be useful strikes us as markedly naive. We are sure that idea died in 1989. But it’s that last insistence that betrays a fundamental misunderstanding. More political oversight does not reduce such abuse and corruption, it provides multiple levels for such influence to be brought to bear. It’s only if one can tell the entire political system to shut up and go away that political incumbents will not - not cannot but will not - divert such funding to their own interests.

Of course, we cannot have the allocation of billions or trillions of the public money without the political process being involved. Therefore we cannot have such allocation of the billions or trillions of public money into investments.

By the way, this isn’t because all in politics are greedy scumbags bent on lifting from the public purse. It’s that the political allocation of trillions will draw greedy scumbags to politics to gain a share of that allocation. It is no more possible to stop this than to stop the wasps finding the jam on a picnic - the only solutions are no jam, or no picnic.

It’s the Willie Sutton lesson in politics. Why wouldn’t the flimflam artists be attracted to where the money is?