Revolving Door

Monday: you regulate the oil industry. Tuesday: you work for the oil industry. Wednesday: you regulate it again. Nobody sees a problem.

The revolving door is the movement of people between government regulatory positions and the private industries those positions are supposed to oversee. A pharmaceutical executive becomes the head of drug safety. A banking regulator retires into a senior role at the bank they supervised. A defence official joins the weapons contractor whose budget they just approved.

The conflict of interest is obvious, but the system treats it as normal. The argument is always that you need industry expertise to regulate effectively. And that's partly true — the people who understand an industry best are the ones who worked in it. But the cost is enormous. When your next job depends on the goodwill of the people you're currently overseeing, the incentive to regulate aggressively disappears. You don't bite the hand that's about to feed you.

The revolving door doesn't require corruption in the traditional sense. Nobody needs to take a bribe. The mere expectation of future employment shapes present behaviour. Regulators soften their positions. Industry insiders bring their loyalties with them into government. The boundary between public interest and private profit blurs until it barely exists.

It's not illegal. That's the point. The door was built to spin.

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References

• Sheldon Wolin — Democracy Incorporated (2008)
• Chris Hedges — Death of the Liberal Class (2010)