Category ►►► Congressional Corruption

August 26, 2010

Why Political Sex Scandals Matter

Congressional Corruption
Hatched by Movie Badger

There hasn't been a political sex scandal in a while, which means that people aren't hypocritically changing their opinions based on which party the cheating politician belongs to. So now's a good time to discuss them.

A lot of people dismiss these scandals by saying, "That's between him and his wife." But I think that viewpoint is crazy, and we absolutely should care when a politician cheats.

The most important quality that we want in elected officials is for them to be trustworthy. We need to have people in office who will put their constituents' interests above their own. We can't watch over their shoulders every second. Anyone capable of getting himself elected will generally be better at hiding his crimes than we are at discovering them. (The exceptions are the scandals we know about. But obviously there are far more incidents that should have been scandals, except the corrupt politicians successfully kept them hidden.)

For a government official, trustworthiness is much more important than intelligence, competence, ability to communicate, or any other quality. If a politician is incredibly skilled but untrustworthy, he'll only be better at screwing us over for his own gain. That's the exact opposite of what we want.

Ordinarily, it's difficult to assess someone's trustworthiness. A successful politician will be very skilled at making people think they can trust him, whether or not that's the truth. Since we can't distinguish between candidates on the most important quality, we fall back on secondary issues - usually whether they claim they'll do stuff we agree with. Lacking better information, we simply have to hope this sub-optimal method of picking who to vote for works out for the best.

But occasionally we do get better information. When a politician cheats on his wife, he is demonstrating that he finds his own personal pleasure to be more important than the promises he made to and happiness of someone he ostensibly loves and sees every day. Once he's shown himself to be that kind of person, why would you think he would act in a trustworthy manner toward millions of people he's never even met?

Would you hire a pickpocket to manage your bank? Would you hire a tax-cheat to oversee the Treasury Department? (Oh, wait...) So why would you hire someone who lies to his wife to tell you the truth?

And this is true whether the cheater is a Democrat or Republican.

By contrast, it doesn't matter when an athlete or actor has an affair. Tiger Woods' job is to whack a ball into a hole with a stick. Nothing about his job requires us to trust him. (There are too many witnesses and cameras for him to have an opportunity to cheat at golf.) And since an actor's job is to pretend to be someone he's not, you could make the case that an ability to fool his wife demonstrates just how talented an actor he is.

So when you're talking about people outside of the government, I would agree that any extra-marital affairs are none of our business. But with government officials, basic common sense dictates that once they've demonstrated that they can't be trusted, we shouldn't trust them.

Dafydd queries -- What about clergymen, doctors, witnesses at trial, lawyers, bankers, and CEOs? Such figures do indeed have a moral, and in the latter four cases a legal obligation to be trustworthy. I think we should care about cheating whenever the cheater is in a position of trust, where we must accept his word as honest. Politicians are just one specific example of a general category.

Also, I should clarify that I'm only talking about when a politician cheats on his or her spouse. I don't care and don't think anyone else should care if it turns out a politician posed for racy pictures, or went to a sex club, or (for an unmarried politician) is "outed" as gay or promiscuous. Those are not issues of trust, and they have nothing to do with how their pepetrators would govern.

Hatched by Movie Badger on this day, August 26, 2010, at the time of 1:39 PM | Comments (1) | TrackBack

November 25, 2008

Rangel Dangle: the Democratic Tsunami of Corruption

Congressional Corruption , Dancing Democrats
Hatched by Dafydd

In an unusually blunt assessment, the New York Times as much as calls longtime, powerful Democratic Rep. Charles Rangel (NY) a crook:

Representative Charles B. Rangel has helped raise $11 million for a City College of New York school of public service to be named in his honor. In recent months, as questions have emerged about his fund-raising, he has insisted that he has kept his efforts to attract donors scrupulously separate from his official duties in Congress.

But Congressional records and interviews show that Mr. Rangel was instrumental in preserving a lucrative tax loophole that benefited an oil-drilling company last year, while at the same time its chief executive was pledging $1 million to the project, the Charles B. Rangel School of Public Service at C.C.N.Y.

On a nutshell, shortly after the September 11th terrorist attacks, Nabors Industries opened offices in the Caribbean to take advantage of tax shelters to duck paying "tens of millions of dollars annually," projected to be more than a billion over a decade; Rangel bitterly denounced the company in 2002-4 for doing so, even sponsoring (failed) legislation to prevent it.

But then in 2007, the CEO of Nabors, Eugene M. Isenberg, pledged a million dollars to help build the "Charles B. Rangel School of Public Service at C.C.N.Y."... and lo and behold, Charles B. Rangel abruptly saw the light; and now, as chairman of the House Ways and Means Committee, Rep. Rangel vigorously defends those selfsame tax shelters.

Not to worry, though; both Rangel and Isenberg insist "There was no quid pro quo." In fact, Mr. Rangel goes so far as to say he had no idea about the megabuck donation to the Rangel School until a year after the fact.

Yet the Times also reports:

What is clear is that Mr. Rangel played a pivotal role in preserving the tax shelter for Nabors and the other companies in 2007. And while the issue was before his committee, Mr. Rangel met with Mr. Isenberg and a lobbyist for Nabors and discussed it, on the same morning that the congressman and Mr. Isenberg met to talk about the chief executive’s potential support for the Rangel center.

In other words, Rangel flatly lied when he "maintained that he did not even know about [Isenberg's $1 million pledge] until this summer, more than a year later."

The essence of this story is not that Nabors Industries made use of a tax shelter; in fact, I'm all for tax shelters -- so long as they're open to any company, not limited to particular congressional "favorite sons." So far as I know, Nabors did nothing wrong or illegal; indeed, in 2004, the Republican 108th Congress gave its nihil obstat to those very shelters, including Nabors'. I have no reason to believe there was anything wrong or fishy about that decision.

No, the core of this story is the convoluted set of interactions between liberal idealism, ideology, and demagoguery, where raw political pragmatism always seems to triumph; administrations may go and come, but the Left abides -- whether under Woodrow Wilson, Franklin Roosevelt, Jimmy Carter, Bill Clinton, or Barack Obama.

In 2006, the chattering classes were all agog about "the Republican culture of corruption;" the cry likely played a great role in the terrible loss by the GOP that year, when both the House and Senate tumbled from the right to the left hand.

As the Minority Leader of the House became Squeaker of the House Nancy Pelosi (D-Haight-Ashbury, 93%), she kept up a bombardment of furious denunciation of the "corrupt" GOP, lumping together everything from votes that favored business in general to successful fundraising to Mark Foley's clumsy passes at former congressional aides (who were adults).

Indeed, poll after poll showed that the attacks worked, with a majority of Americans believing the GOP was uniquely corrupt, or at least far more corrupt than their counterparts on the left. After winning the congressional elections of 2006, Pelosi was still on that hobby horse:

"The American people voted to restore integrity and honesty in Washington, D.C., and the Democrats intend to lead the most honest, most open and most ethical Congress in history," Pelosi said.

Yet without the slightest sense of irony, she proved adamant in her refusal to lift a finger to rein in the most obvious, if not biggest, example of rampant corruption and abuse: earmarks. She also made no serious effort to purge the Democratic caucus of even the most egregious examples of "cold cash for legislation" (remember Rep. William "Freezer Bill" Jefferson, still a Member of Congress from Louisiana, despite being indicted last year for corruption?)

And the Democratic response to the continuing soap opera of Charles Rangel's ethics problems? He was just unanimously reelect him as chairman of Ways and Means last Thursday. So much for "the most honest, most open and most ethical Congress in history"... and the elite media's only reaction was a collective yawn.

They have no excuse; this story was published on the New York Times website yesterday and is on the front page of the print edition today; it is now part of "all the news we see fit to print," and it should be part of our national political dialog. So as a famous failed presidential candidate said more than a decade ago, "where's the outrage?"

Is the Washington Post going to pick up the story? They certainly haven't yet. Neither has any other major news outlet (unless one counts UPI as "major"). Nothing on the networks, not a word on CNN, MSNBC is silent; even Fox News seems to have missed the story -- which is not surprising, alas. We'll keep an eye on them to see if their consciences belatedly bait them into acknowledging this latest nigh-Jeffersonian (William, not Thomas) level of corruption by Mr. Rangel, but I doubt they will.

One would think that the elites would be a bit less reticent, given the powerful cover offered by the king of elite liberalism, the Times, which back on September 14th went so far as to call for Rangel to resign his chairmanship of the House Ways and Means Committee.

Evidently, however, "corruption" is defined as something that the Right does to the Left... just as liberals consistently define "racism" as something that whites do to blacks. By definition, it's not bribery if a Democrat -- especially a black Democrat -- accepts money in exchange for reversing his policy... but it's the rankest form of corruption if a Republican pursues policies, like tax cuts or the war in Iraq, that are supported by the folks who support him. (Republicans must continually prove their honesty by only supporting policies antithetical to everything their core constituencies want... which too many of them are all too eager to do.)

And equally evident is that the drive-by media are very comfortable letting the Democrats walk off with the cash register under one arm. No surprise there, either.

Hatched by Dafydd on this day, November 25, 2008, at the time of 3:24 AM | Comments (2) | TrackBack

November 18, 2008

Size Matters

Congressional Corruption
Hatched by Dafydd

All signs point to President-Elect Barack H. Obama naming Eric Holder to be his Attorney General. Holder is basically a nonentity whose only claim to the office is that he represents continuity and stasis with the Clinton administration, having moved into Jamie Gorelick's job when she abruptly resigned in 1997 to become vice chairman of Fannie Mae.

We essentially know only one thing about Holder: He favored the pardon of fugitive financier and justice mocker, the aptly named Marc Rich. In fact, President Bill Clinton said that Holder's support as Deputy Attorney General was a key factor in Clinton deciding to issue the pardon (that plus the millions of dollars Rich's wife Denise donated to the Clinton library fund).

Funnily enough, the one thing we know about Holder is also the one thing that may stand in his path to the AG's job:

The only hesitancy about Holder’s selection was that he himself had reservations about going through a confirmation process that was likely to revive questions about his role in signing off on the controversial pardon of fugitive financier Marc Rich. Although there is no evidence that Holder actively pushed the pardon, he was criticized for not raising with the White House the strong objections that some Justice Department lawyers and federal prosecutors in New York had to pardoning somebody who had fled the country.

Well, let's be a little more specific: Rich fled the country to escape prosecution for income-tax evasion and trading with Iran while Iran was holding American hostages and on the banned-nation list; he renounced his American citizenship as well.

Mark Rich was close friends with the Ayatollah Ruhollah Khomeini, which gave him access to lucrative illegal trade deals. Prior to Khomeini's ascension, Rich put together a deal to make a fortune by exploiting the Arab oil embargo of 1973-1974; his contacts with the corrupt governments of Iran and Iraq allowed him to buy cheap oil and sell it for more than a 100% profit in the United States.

Rich spent his exile in Swiss chalets and ski slopes with his fellow ultra-rich ex-pats and multinationalist vagabonds. After a few years of such penance, Clinton decided that the oil-crisis profiteer had suffered enough; the president gave Rich a full and complete pardon on the last day of Clinton's administration, despite the unease of his own Justice Department -- excepting Eric Holder, of course.

Thus, Holder is now nervous that his limp support and incuriosity -- Holder never wondered why the president would pardon a man who used his vast wealth (about $1.5 billion) to laugh at the American criminal-justice system -- might damage his chance to become the chief law-enforcement officer of the United States. But not to worry, because the Obama administration has the killer counterargument:

But after reviewing the evidence in the case, and checking with staffers on the Senate Judiciary Committee, Obama aides and Holder both decided the issue was highly unlikely to prove an obstacle to his confirmation, one of the sources said -- especially given the Democrats’ more sizable post-election majority in the Senate.

Yep; that's about the "size" of it; the Democrats have the votes, so to hell with the concerns of law enforcement.

Barack Obama: Stuffing his administration full of former Clintonistas; bullying the opposition; announcing practically the moment after his election that he didn't feel bound by any of his campaign promises; and already crowning himself with the glory of Franklin Delano "President Government" Roosevelt and (absurdly enough) Abraham Lincoln before serving even a single day as president. This is quite definitely "change I can believe in" from our President-Elect.

Hatched by Dafydd on this day, November 18, 2008, at the time of 2:31 PM | Comments (2) | TrackBack

November 17, 2008

Does She Get a "Bye?"

Congressional Corruption
Hatched by Dafydd

Rich Galen, of Mullings fame, wrote a cybercolumn about the 63-question "questionaire" that the Obama transition team now requires all applicants for administrative positions to fill out; it includes a very large number of very intrusive questions, which Galen compares to the "are you now or have you ever been a Communist?" type questions asked during the heyday of McCarthyism (which "ism" I happen to applaud, by the way, but that's not germane to this point).

Immediately after reading that issue of Mullings, I read this:

Sen. Hillary Rodham Clinton is among the candidates that President-elect Barack Obama is considering for secretary of state, according to two Democratic officials in close contact with the Obama transition team.

Clinton, the former first lady who pushed Obama hard for the Democratic presidential nomination, was rumored to be a contender for the job last week, but the talk died down as party activists questioned whether she was best-suited to be the nation's top diplomat in an Obama administration.

The talk resumed in Washington and elsewhere Thursday, a day after Obama named several former aides to President Bill Clinton to help run his transition effort.

This raises an immediate impasse: How on earth is Hillary going to be able to answer even half the questions on the questionaire? Here are a few examples, complete with Sen. Clinton's answers (leaked to Big Lizards by someone who identified himself only as "Ted"):

  1. If you or your spouse have performed any work for, received any payments from and/or made any payments to any foreign government, business, non-profit organization or individual, please describe the circumstances, and identify the source and amount. Also please specify if you or your spouse has ever been registered as an agent for a foreign principal.
Nobody every proved anything about the Riadys, the Buddhist monks, the People's Liberation Army, and the Clinton Library.
  1. If you or your spouse have ever lived or worked abroad, please describe the circumstances.
Spouse lived in England for several years, faking being a Rhodes scholar to evade Vietnam draft.
  1. Briefly describe the most controversial matters you have been involved with during the course of your career.
Please furnish additional ream of paper... I'm a little short right now. Or cf. the Seduction of Hillary Rodham.
  1. Testimony: Please identify each instance in which you have testified before Congress or other legislative, administrative, investigative or regulatory body, and specify the subject matter of the testimony. If available, please provide summaries or transcripts of your testimony.
Does this include congressional testimonty on HillaryCare and/or spouse's minor dustup in 1998?
  1. Speeches: Please identify all speeches you have given. If available please provide the text or recordings of each such speech or identify any recordings of speeches of which you are aware.
Speeches available upon request and prompt payment of $1,500,000 per shot.
  1. Electronic communications: If you have ever sent an electronic communication, including but not limited to an email, text message or instant message, that could suggest a conflict of interest or be a possible source of embarassment to you, your family, or the President-Elect if it were made public, please describe.
Does this include the spouse's pre-paid account at iHotTalk-976?
  1. Please specifically describe any affiliation you, your spouse or any member of your immediate family have, or have had, with any financial, banking, mortgage or insurance institution that is currently the subject of federal government intervention as part of the ongoing economic crisis. This question includes, but is not limited to, the following: Fannie Mae, Freddie Mac, AIG, and Washington Mutual.
Nope, nada: We were always careful to use cutouts, such as Franklin Delano Raines, Jamie Gorelick, and your new Chief of Staff.
  1. Other than the entities identified in questions 15-19 above, please provide the names and details of any individuals and organizations with which you or your spouse have been associated with which might present a conflict of interest with your proposed federal office, or have the poetntial for embarassment.
Sen. Charles Schumer, Rep. Charles Rangel, Guru Al Gore, 23 Buddhist monks, 4 PLA generals and colonels, Chelsea Clinton, Bono, the executive leadership of NARAL, Saul Alinsky, Michael Medved, David Brock!!, James Riadi, Johnny Chung, John Huang, and Weasely Clark. (See attached 413-page testimonial and 1-5 star rating of spouse's concubines.)
  1. Please list any lawsuits you or your spouse have brought as a plaintiff or which were brought against you or your spouse as a defendant or third party, or in which you or your spouse have testified at trial or deposition. Include in this response any arbitrations, mediations, and contested divorce proceedings or other domestic relations matters.
Paula Jones is a pig.
  1. Have any members of your family or close social or business associates been arrested for, charged with and/or convicted of a crime, other than a minor traffic violation? If so, please identify and describe each such arrest, charge, or conviction. Please provide the same information for anyone under your professional supervision, or anyone of your superiors.
We no longer speak of Roger, so butt out.
  1. Have you or your spouse ever been accused, formally or informally, of any violation of government or agency procedure (specifically including security violations)?
What is this, a joke? How much time do you think I'm going to spend on this thing?
  1. Have any civil judgments or liens been rendered against you or your spouse? If so, please provide details.
Paula Jones is a Notorious P.I.G..
  1. If applicable, please list the names, addresses and phone number of cohabitants within the last ten years. A cohabitant is a person with whom you share bonds of affection, obligation, or other commitment, as opposed to a person with whom you live for reasons of convenience (a roommate).
My spouse was never "alone" with Monica Lewinsky. And I was never "alone" with Patti Solis Doyle.
  1. Do you or any members of your immediate family own a gun? If so, provide complete ownership and registration information. Has the registration ever lapsed? Please also describe how and by whom it is used and whether it has been the cause of any personal injuries or property damage.
Not yet, but I'm running out of lamps. Just one more roundheel floozy, and who can say?
  1. Have you had any association with any person, group or business venture that could be used -- even unfairly -- to impugn or attack your character and qualifications for government service?
Yes, the United States Senate.
  1. Do you know anyone or any organization, either in the private sector or government service, that might take steps, overtly or covertly, fairly or unfairly, to criticize your nomination, including any news organization? If so, please identify and explain the potential basis for criticism.
Yes, the United States.
  1. Please provide any other information, including information about other members of your family, that could suggest a conflict of interest or be a possible source of embarassment to you, your famliy, or the President-Elect.
Oh for God's sake, mishandle your own foreign policy, you word-breaking, fund-withholding, King-Canute-copying, sexist jerk. I'm outa here.

Oh heck. Maybe they'll just pencil-whip her through without the silly, old questionaire at all.

Hatched by Dafydd on this day, November 17, 2008, at the time of 3:56 AM | Comments (9) | TrackBack

October 27, 2008

Maybe Sarah Palin Reads Big Lizards...!

Congressional Corruption , Presidential Campaign Camp and Porkinstance
Hatched by Dafydd

Earlier today, I gave Mrs. Palin a piece of my mind (I haven't many left) about what to do in response to the corruption convictions of Sen. Ted Stevens (R-AK, 64%). I suggested:

At the presser, Alaska Gov. Sarah Palin should discuss the verdict, note that she has fought Sen. Stevens for a long time over his corruption, and announce that when he is finally forced to resign his office -- she will call for a vote to expel him from the Senate feet first, if he won't go vertically -- she will appoint David Cuddy as his successor.

A vote for Stevens, she should say, will really be a vote for Cuddy.

I'm sure she reads Hugh Hewitt's blog -- at least the Palin posts by Bill Dyer (Beldar). I envy him the invitation to either the inaugural reception or the Alaska governor's mansion that I'm sure he'll receive.

But maybe she reads Big Lizards, too; either that, or it's a case of two thoughts with but a single mind between them. For as Dyer notes, she just released the following response:

This is a sad day for Alaska and for Senator Stevens and his family. The verdict shines a light on the corrupting influence of the big oil service company that was allowed to control too much of our state. That control was part of the culture of corruption I was elected to fight. And that fight must always move forward regardless of party or seniority or even past service.

As Governor of the State of Alaska, I will carefully monitor this situation and take any appropriate action as needed. In the meantime, I ask the people of Alaska to join me in respecting the workings of our judicial system. I'm confident Senator Stevens will do what is right for the people of Alaska.

All right, it's not exactly what I suggested: She didn't overtly threaten to get the Senate to expel him nor mention Cuddy or any other successor. But Bill Dyer points out that the verdict is not official yet, not until the trial judge accepts it. Then there are the inevitable appeals, but I don't think that will delay her more forceful statement; she must only wait for the trial judge to enter the judgment officially -- meaning he concurs that the jury had the necessary facts before it to find him guilty of those charges.

In any event, Palin evidently agreed with Big Lizards that she had to jump out immediately and say something about such a massive corruption decision in her own state. So there.

...So when do I get my own invitation to the inaugural or the Juneau jubilee? Or at the very least, my invitation to the next Iditarod, starting March 7th? I don't want to have to masquerade as Beldar's manservant yet again, just to get a free chicken dinner.

Hatched by Dafydd on this day, October 27, 2008, at the time of 11:36 PM | Comments (2) | TrackBack

What to Do About Criminally Convicted Sen. Teddy?

Congressional Corruption
Hatched by Dafydd

No, not that Teddy... I said "criminally convicted." I'm referring to RINO Sen. Ted Stevens (R-AK, 64%), just found guilty of all seven counts of felony corruption charges. He was already in a tight race against Democrat Mark Begich -- the polling at Real Clear Politics has three polls, each within the margin of error; what can be done to make it more likely that Republicans will hold that Senate seat?

As an immediate first step, I would hope that the governor of Alaska (some woman, I vaguely recall) should call a press conference. Because of other recent activities of hers, I suspect she will get a lot of reporters. At the presser, Alaska Gov. Sarah Palin should discuss the verdict, note that she has fought Sen. Stevens for a long time over his corruption, and announce that when he is finally forced to resign his office -- she will call for a vote to expel him from the Senate feet first, if he won't go vertically -- she will appoint David Cuddy as his successor.

A vote for Stevens, she should say, will really be a vote for Cuddy.

Former state legislator David Cuddy was the second-place finisher in the GOP primary; Stevens got 67% of the vote, Cuddy got 28%, and nobody else was even in double digits.

Palin should make it clear that even if Stevens tries to stay, Republicans in the Senate will vote en masse against allowing a convicted felon to serve.

But since expulsion from the Senate requires a two-thirds vote (67 members), it would finally be up to the Democrats to complete the sequence; in the current Congress, that means that if all 49 Republicans vote to expel, it would still require 18 of the 51 Democrats, or 35%, to rid the senatorial body of its cancer -- or this particular cell of it, at least. (I include Sens. Joe Lieberman, I-CT, 70%, and Bernie Sanders, I-VT, 95%, as "Democrats" because they caucus as such). Thus, if Stevens stays, it will be because Democrats, in a fit of staggering partisan gamesmanship, vote to keep him there so they can try to hang him around Republicans necks.

There is certainly no guarantee such an announcement would hold that seat; it was already dicey before the convictions. But at least this would give the Alaska GOP a fighting chance to make the case that they stand foursquare against corruption; and that if anyone is going to keep a convicted felon in the United States Senate, it will be the Democrats... who in the past have rarely seen mere criminality as a barrier to public service.

Hatched by Dafydd on this day, October 27, 2008, at the time of 2:58 PM | Comments (6) | TrackBack

October 7, 2008

Freddie & Fannie & Frank & Moses

Congressional Corruption
Hatched by Dafydd

Rep. Barney Frank (D-MA, 95%) has emerged as the face of the Democratic Party, explaining why the current fiscal crisis is all the fault of the Republican culture of corruption, laissez-faire Capitalism, and racism:

The Massachusetts Democrat, chairman of the House Financial Services Committee, said the GOP is appealing to its base by blaming the country's mortgage foreclosure problem on efforts to expand affordable housing through the Community Reinvestment Act.

He said that blame is misplaced, because those loans are issued by regulated institutions, while far more foreclosures were triggered by high-cost loans made by unregulated entities.

"They get to take things out on poor people," Frank said at a mortgage foreclosure symposium in Boston. "Let's be honest: The fact that some of the poor people are black doesn't hurt them either, from their standpoint. This is an effort, I believe, to appeal to a kind of anger in people."

Frank also dismissed charges the Democrats failed on their own or blocked Republican efforts to rein in the mortgage companies Fannie Mae and Freddie Mac. The federal government recently took control of both entities.

However, prior to emerging as the voice of restraint and regulation, Barney Frank was the voice of "nothing to oversee here, just move on" denial:

''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''

Frank made this argument to stop a proposal by the Bush administration to increase the regulation and oversight of Fannie Mae and Freddie Mac, creating a firewall that might have stopped exactly the crisis we face today. Barney Frank and his cohorts were successful; the plan was killed in Congress.

Going back at least to 1995, Frank has successfully fought against any sort of biting regulation of either Fannie or Freddie -- as well as against any curtailing of the Jimmy Carter written, Bill Clinton revised Community Reinvestment Act, which forces financial institutions to make low-interest, zero-down mortgages to poor people with lousy credit... the "subprime" component of the subprime mortgage crisis.

But on Friday we learned that there may be another, more personal reason why Barney Frank has been so adamant all these years against changing any of the corrupt financial practices at these institutions. Ace reporter Bill Sammon reports for Fox News:

Unqualified home buyers were not the only ones who benefitted from Massachusetts Rep. Barney Frank’s efforts to deregulate Fannie Mae throughout the 1990s.

So did Frank’s partner, a Fannie Mae executive at the forefront of the agency’s push to relax lending restrictions. [Note that "partner" doesn't just mean business partner or even partner in crime; it means domestic partner.]

Now that Fannie Mae is at the epicenter of a financial meltdown that threatens the U.S. economy, some are raising new questions about Frank's relationship with Herb Moses, who was Fannie’s assistant director for product initiatives. Moses worked at the government-sponsored enterprise from 1991 to 1998, while Frank was on the House Banking Committee, which had jurisdiction over Fannie.

Well! In fact, Moses was one of the progenitors of the very project that has crippled the world's credit market and led to a staggering loss on world stock markets. As "assistant director of product initiatives," he helped create the very "subprime" mortgage instruments that collapsed last month, leading to the financial meltdown.

Frank "spent years" preventing the Republican-sponsored regulations that would have trimmed the subprime market -- and incidentally hurt the pocketbook of Herb Moses and his domestic partner, Barney Frank. This is about as direct a conflict of interest as one can imagine, as Frank's deregulation fervor directly impacted his "spouse's" salary:

Although Frank now blames Republicans for the failure of Fannie and Freddie, he spent years blocking GOP lawmakers from imposing tougher regulations on the mortgage giants. In 1991, the year Moses was hired by Fannie, the Boston Globe reported that Frank pushed the agency to loosen regulations on mortgages for two- and three-family homes, even though they were defaulting at twice and five times the rate of single homes, respectively.

Amazingly, even Bill Clinton agrees that the Republicans kept trying to rein in the out of control securitization of bad mortgages, but the Democrats (led by Frank and other corrupt leaders) thwarted every attempt. How galling that Barack H. Obama now goes on television at every opportunity to blame John S. McCain and his fellow Republicans and their supposed "deregulate everything" attitude for the crisis... which would actually have been averted if Democrats such as Rep. Barney Frank had not been so bloody determined to stop any scrutiny of the subprime mortgage market -- and its enablers, Fannie Mae and Freddie Mac.

At least in Frank's case, we now know why he was so adamant.

Hatched by Dafydd on this day, October 7, 2008, at the time of 8:20 PM | Comments (3) | TrackBack

September 30, 2008

The Pearlstein Option Reconsidered

Congressional Corruption , Econ. 101 , Toxic Jackassets
Hatched by Dafydd

Clearly, we need a new proposal for the credit catastrophe... a proposal that is both workable and passable in the current 110th Congress (the 111th will almost certainly be worse). But allow me to start by looking at one that is obviously un-workable and un-passable.

Read this war statement by Rep. Michelle Bachmann (R-MN, 100%) "explaining" her Nay vote on the Paulson rescue plan; she first exults in her triumph, then enunciates her putatively new proposal. The statement was quoted rather approvingly by John Hinderaker as a good example of the "conservative case" that could be made against the plan:

Today marks an historic moment for America as a solid bipartisan majority of Congress rejected the fatally flawed Paulson Plan. Standing shoulder to shoulder with taxpayers, we declared that we can do better.

As I’ve stated previously, this plan was rushed, unworkable, and short-sighted. A majority of House Republicans have parted ways with President Bush on this plan and we demand that alternative proposals be put on the table. There is universal agreement that this plan was bad, but its supporters claimed it was the only option. There were alternatives available, but Speaker Pelosi and the Administration chose to ignore them and used every parliamentary trick in the book to stifle debate. Now, they will have to listen to the voices of American taxpayers who refuse to open their checkbooks to Wall Street to write a $700 billion check with no strings attached.

I support a plan that would have Wall Street bail itself out, not hardworking taxpayers, by requiring institutions to insure troublesome assets that are causing today’s credit crunch. It would suspend mark-to-market accounting, which forces companies to take losses on artificially devalued assets on an artificial timetable, to give investors more confidence.

The plan I support would break up Fannie Mae and Freddie Mac -- government sponsored enterprises that are at the heart of this crisis -- so that the encumbered taxpayer no longer backs them -- implicitly or explicitly -- and so that they do not artificially grow larger than the market will allow. We cannot pass legislation that sets America up for a Groundhog Day reprise of this mess and that means changing the problem at its core - the GSEs.

Furthermore, the plan I support suspends capital-punishing tax rates to bring more capital into the U.S. markets rather than our foreign competitors. And, the plan ensures the Federal Reserve’s attention is focused on long-term price stability rather than short term economic growth. Finally, it requires the US Treasury to write rules keeping executives who made the risky decisions from personally profiting from them with excessive compensation or golden parachutes all at the expense of taxpayers. We can't have a market that only condones risky behavior. The balance between risk and reward is an important part of the free market.

My colleagues and I stand ready and willing to negotiate with any parties on a plan that will help stabilize our financial markets and relieve the liquidity crisis without exposing taxpayers to a $700 billion bailout debacle.

What is wrong with this picture? Two things:

First of all, in the first blue-highlighted passage, she falsely -- even mendaciously -- caracatures the Paulson plan as a bid to "open [taxpayer] checkbooks to Wall Street to write a $700 billion check with no strings attached."

This is demagogy, pure and simple; it's as bad as Squeaker of the House Nancy Pelosi's (D-Haight-Ashbury, 93%) "history lesson" on the Bizarro-world origins of the crisis in the "unregulated, anything goes" economic policy of the Bush-McCain administration.

Bachmann knows better; she knows that nobody is writing a check to "Wall Street" (is that what Paulson scribbles on the "pay to the order of" line?); that we would in fact be buying securities that are underpinned, at their core, by real property; that the initial cost would be much less than $700 billion; and that the most likely outcome is that those securities would rise in value, so we would make back much of what we spent... and maybe even make a profit.

(We know that House Republicans understand this, else why would they have fought so hard to get a provision ensuring that all "profits" would go to pay down the federal debt?)

But apart from the libelous description of the rejected plan, there is another problem with Bachmann's statement: The centerpiece of Bachmann's own alternative is the same insurance-only option Democrats already rejected.

Why would the Democrats make an abrupt about-face and support it now? After deliberately (most now agree) killing the plan in the first place, does anybody honestly believe that they will now do everything in their power to give the Republicans a huge, huge victory -- right before the election?

The insurance option was never very well explained, and I for one cannot fathom how anyone could think that it, all by itself, would inject enough liquidity to unfreeze the credit market. For one reason, it requires massive insurance premiums to be paid on very, very insecure securities by the same firms that have no capital to pay anything. That's the whole problem... they have no liquidity, and they cannot borrow any money.

What are we supposed to do -- lend them the money to pay for the insurance premiums we charge them? Isn't that a lot closer to "opening taxpayer checkbooks to Wall Street" than the plan they rejected?

It is surreal to offer as a "plan" for resolving a congressional impasse the very provision the other side has already declared a deal-killer. It is absurdist to pretend that this time, everything will be different. Why -- does she think Democrats are now contrite? And it is breathtakingly hypocritical to reject a plan on the grounds that it constitutes writing a check to Wall Street... and then offer in its place a plan that constitutes writing a check to Wall Street.

If there were other new ideas in her "plan" besides the insurance option, something that Democrats had not already emphatically rejected, it might be a good basis to begin negotiation on a compromise. Here are the other ideas she proposes; see if any strikes you as either original or able to resolve the current crisis in any reasonable period of time (that is, before the axe rolls):

  • Suspend (why not eliminate entirely?) "mark to market" accounting, which forces even those firms that have no intention of selling a security nevertheless to revalue it everytime some other panicked or desperate institution dumps it below the current price -- thus devaluing the reserves of even healthy financial institutions, holding them hostage to the sickest.

This is a good idea -- but not only was it already in the previous bill she voted against, it can only help somewhat... and almost by definition, only helps those institutions that are the healthiest anyway. We need a way to prevent hundreds of unhealthy firms from going belly-up right now.

  • "Break up" Fannie and Freddie "so that the encumbered taxpayer no longer backs them -- implicitly or explicitly."

I have no idea what she means here: just remove their status as government sponsored enterprises (GSEs), so they become private institutions instead? Or forcibly dismantle them?

While that takes the taxpayer off the hook for propping them up, which is a worthy long-term reform, how does that make either more solvent right now? Wouldn't both Fannie Mae and Freddie Mac then immediately collapse, forcing them to flood the market with more than a trillion dollars (!) of currently toxic, illiquid instruments?

  • Temporarily suspend the capital-gains tax.

Again, a wonderful idea for the long-term (but let's make it a permanent elimination)... but how does this help now? Does Rep. Bachmann actually think that those firms currently in danger of sinking under the waves are worried about being taxed on some huge capital gain? In fact, as we discussed earlier, suspending the tax removes the incentive for firms to write off bad debts for tax purposes, pushing them towards bankruptcy instead.

  • Prevent "executives who made the risky decisions from personally profiting from them with excessive compensation or golden parachutes all at the expense of taxpayers."

An interesting argument to make from a congresswoman who goes on, two sentences later, to extol the "free market!" But again, the Democrats are foresquare behind this -- and it would have no short-term impact whatsoever on frozen credit.

  • [Ensuring] the Federal Reserve’s attention is focused on long-term price stability rather than short term economic growth.

This isn't a proposal; it's a description of the result that Bachmann hopes will accrue from the other elements of the plan. Congress cannot order the Fed to focus on one thing or another and expect to be obeyed:

Owen Glendower: I can call spirits from the vasty deep.

Hotspur: Why, so can I, or so can any man. But will they come when you do call for them?

Shakespeare, Henry IV, Part 1, act 3

What we need is a plan that is both workable -- that is, it would actually help resolve the present credit crisis, not simply a grab-bag of great ideas for making the system better far in the future -- and also passable... something both conservatives and liberals can back. To propose something that is neither is the pinacle of irresponsibility (and electoral stupidity).

I believe several points are imperative; for workability:

  1. Such a compromise plan must give a gigantic incentive for somebody with enough liquidity to take the toxics off the backs of the struggling financial institutions before they all collapse, taking the larger economy with them.
  2. This "somebody" must be able to make them thoroughly transparent, to give the market a chance to revalue them, allowing subsequent sale.
  3. Thus, Mr. Somebody must be able to compel compliance by the former owners in investigating the history of the security.

These three requirements narrow that "whoever" down to some branch of the administration or a proxy that holds the same powers, in my opinion; in other words, this program must be administered by the Treasury, FDIC, the SEC, some other regulatory body, or a corporation administered by one of the above and granted pass-through authority by Congress. Nobody else has the trust, the ready capital, and the regulatory power to make it work.

This doesn't mean that private capital cannot compete with the government for those securities... so long as, in the end, financial institutions are compelled to cooperate with some entity to detoxify their frozen assets and get the credit market moving again.

And for passability through Congress:

  1. The plan cannot be something already rejected by one or the other side as a "deal killer." (Liberal Democrats cannot ram through a Pelosi dream-list -- at least not for four months -- because (a) the Senate would filibuster it, and (b) the president would veto it.)
  2. Yet it must resolve the central problem stopping House conservatives like Michelle Bachmann from supporting it: putting taxpayers at risk for the huge price tag of what they have dubbed a giveaway to Wall Street.

In an earlier post here, we briefly mentioned an intriguing suggestion, the "Pearlstein Option":

There are some other proposals floating about. Steven Pearlstein in the Washington Post has a very interesting one... Treasury sets up a resolution corporation (as per Paulson-Bernanke); but then instead of buying the illiquid securities with cash, they swap them for preferred stock in the new resolution corporation itself:

My own suggestion would be to structure the rescue around a new government-owned corporation that would be capitalized, initially, with $100 billion in taxpayer funds. The company would use auctions or other mechanisms to buy the troubled securities from banks and other regulated institutions, but instead of paying for them in cash, the government would swap them for an equal number of preferred shares in the new company. (Preferred shares are something of a cross between a bond and common stock.) Those preferred shares would pay a government-guaranteed dividend and could be redeemed by the government at any time. But they could also be used by banks to augment the capital they are required to maintain by regulators.

The beauty of this arrangement is that, rather than protecting taxpayers by having the government take an ownership stake in hundreds of privately owned banks, it would be the banks that would own a stake of the government's rescue vehicle. The government would suffer the first $100 billion in losses from buying and selling the asset-backed securities, but any further losses would be borne by the other shareholders. And should the rescue effort actually wind up making a profit, then the banks would share in that as well.

I believe this could be the basis of a new compromise (sorry, more bullets incoming):

  • It would remove the risk from taxpayers and put it back on Wall Street institutions who accept the preferred stock; the only money spent would be the initial capitalization of the resolution corporation, and perhaps some later recapitalization in the early phases (probably less than the $85 billion required by the takeover of AIG... let alone if, say, Bank of Amerca were to go under).
  • Nevertheless, by allowing those institutions to count such preferred stock as reserves against whatever they have leveraged, it removes the pressure to sell, sell, sell to get their reserve-to-debt ratio down below the legal minimum.
  • Since no significant taxpayer money would be going directly to failed financial institutions, there is no way that any rational voter could consider this a "bailout" of Wall Street.
  • The resolution corporation (fully government-owned, not one of those pesky GSEs) would have the legal authority to compel cooperation by former security owners, thus allowing them to create a paper trail of each security. This will make it possible for the market to "reset" those securities by auctioning them off -- generally for much more than they paid for them.
  • But because even a government-owned corporation is still a corporation, not the U.S. Treasury itself, other institutions should be allowed to bid against it to buy securities. This creates market forces at both ends, buying the illiquid asset and reselling it.
  • Assuming all goes more or less as planned, the resolution corporation will make a profit... thus giving a big incentive to institutions to participate, since the value of their preferred shares in the resolution corporation will rise, giving them even more reserves.
  • The Democrats evidently had no problem with allowing the federal insurance idea as an option, not the entire plan, since it was an option in the last bill; I presume this means they'll allow it as an option again.

I hope this idea is at least brought up; I'm sure that a sizeable minority of Republicans now regrets its Nay vote and are looking for an excuse to change it; and I further suspect the majority of conservative Naysayers is quite willing to consider voting Aye -- for a less statist, more free-market proposal such as the Pearlstein Option.

But whatever we do, we need to do something quick. This isn't just the "do something!" disease; we really are on the brink of catastrophe. You know I'm not given to Cassandra-like dire warnings of pending doom... but let's all remember that Cassandra was right, and Troy did indeed fall.

Like a blinking VCR clock, even a prophet of doom can be right once a day.

Hatched by Dafydd on this day, September 30, 2008, at the time of 3:24 PM | Comments (17) | TrackBack

September 28, 2008

Done Deal - at Least, Very Likely Done

Congressional Corruption , Econ. 101 , Toxic Jackassets
Hatched by Dafydd

It appears that John S. McCain's intervention has borne fruit: All of the major players -- the White House, the Senate and House Democrats, the Senate Republicans, and now even the House Republicans (HRs) -- appear to have signed off on a credit-rescue deal tonight.

As we predicted, it is basically the original deal with some of the HRs' proposals rolled in... notably the insurance option, which would be one of the choices that Secretary Henry Paulson has at his disposal and is required to set up and at least attempt before buying the toxic assets on behalf of the government:

At the insistence of House Republicans, who threatened to sidetrack negotiations at midweek, the insurance provision was added as an alternative to having the government buy distressed securities. House Republicans say it will require less taxpayer spending for the bailout.

But the Treasury Department has said the insurance provision would not pump enough money into the financial sector to make credit sufficiently available. The department would decide how to structure the insurance provisions, said Sen. Kent Conrad, D-N.D., one of the negotiators.

This story doesn't quote any House Republicans directly; but I don't think they would stay silent if they were once again being rolled by the other players. Still, the AP story is cautious -- having been fooled once by Squeaker of the House Nancy Pelosi (D-Haight-Ashbury, 93%) and Senate Majority Leader Harry "Pinky" Reid (D-Caesar's Palace, 85%):

It was not immediately clear how many House Republicans might vote for the measure. With the election five weeks away, Democrats have said they would not push a plan that appeared sharply partisan in nature.

(That is, "Fool me once, shame on you; fool me 527 times in a row, and you can call me an Obamaton.")

The New York Times story did manage to corral Rep. Roy Blunt (R-MO, 96%), lead negotiator for the HRs, but he was in a "show-me" mood:

Representative Roy Blunt of Missouri, the chief negotiator for House Republicans, who have been among the most reluctant to support the plan, expressed some satisfaction but did not commit his members’ support.

“We need to look and see where we are on paper tomorrow,” Mr. Blunt said. “We have been talking about how we can make these things work in a way that our conference can come together.”

Some other concessions to the free market and conservative principles were obtained by Blunt, McCain, and the HRs:

  • The salary and bonus caps would only apply to "fired executives of financial firms, and executives of firms that go bankrupt," as AP puts it, not to every executive at every company that sells distressed securities to the federal government, as Democrats originally demanded.
  • The "equity interest" that the Democrats wanted in all firms that sell assets to the resolution corporation will be limited to only some of them, but I cannot discover the criteria that will determine which do and do not have to give up some stock to the Treasury-created corporation.
  • The Democrats had demanded that 20% of any profits that the feds might make on the deal, as they auction off value-added securities in an improved market, be ploughed into affordable housing -- which is what got us into this mess in the first place; but the HRs appear to have killed that provision.
  • Democrats also have given up on their scheme to allow bankruptcy judges to unilaterally alter the terms of first mortgages in bankruptcy proceedings; instead, the Treasury will have the authority to attempt to renegotiate mortgage terms if that would reduce the liability facing the government by reducing the risk of default or even foreclosure. That is, only when such renegotiation is good for the United States... not whenever it's advantageous to the over-extended borrower (buying a $400,000 dream house when he really could only afford a $200,000 fixer-upper).

But for the timely intervention of John McCain, no one would have talked to the House Republicans, and none of these concessions would have been made; therefore, the deal would never have gone through. McCain has kept in constant contact with the negotiators, relaying information back and forth, pushing for the necessary compromises, and selling the HRs on the plan.

Barack H. Obama, meanwhile, has also been "active," as the Times insists:

Early in the day, the two presidential nominees were active from the sidelines. Mr. McCain telephoned Congressional Republicans to sound them out, and Mr. Obama got regular updates by phone from Mr. Paulson and top lawmakers.

Evidently, the word "active" in Obama's case means standing anxiously by the phone, waiting for a call to bring him up to speed, so he won't look ridiculous.

Finally, I find this tidbit to be most illuminating:

While Congressional Republicans sent only their chief negotiators, Mr. Blunt and Senator Judd Gregg of New Hampshire, at least nine Democrats with competing priorities piled into the meeting, surprising the Republicans but apparently not unsettling them.

It fills my heart with patriotic joy to see the Democratic Party put aside its petty, internecine differences to resolve a true national crisis.

Hatched by Dafydd on this day, September 28, 2008, at the time of 4:04 AM | Comments (7) | TrackBack

September 26, 2008

The Roads Must Roll, Along With a Few Heads - slight UPDATE

Congressional Corruption , Econ. 101 , Presidential Campaign Camp and Porkinstance , Toxic Jackassets
Hatched by Dafydd

Here is the bailout problem in a nutbag. There was indeed a deal before John S. McCain arrived... a completely bicameral deal between House Democrats -- and Senate Democrats. The deal also included (evidently) the White House; and the Senate Republican conference climbed aboard the bandwagon.

The outlines of the deal were that President George W. Bush gets the Paulson-Bernanke emergency rescue plan -- and the Democrats extort a number of their domestic welfare programs:

  • Long-term extension of unemployment benefits, so that fewer people will go back to work;
  • A "housing trust fund" that would funnel taxpayer money to ACORN and other radical groups;
  • Salary caps on everyone who makes more money than members of Congress;
  • A secret, back-door restoration of the ban on shale-oil development, which Majority Leader Harry "Pinky" Reid (D-Caesar's Palace, 85%) tried to sneak into the rescue bill;
  • Fascistic government ownership of the banks, and so forth.

Of course, if you pore over the list above of participants in this deal, you will of course notice one missing piece: House Republicans. The House Republican conference is consistently more conservative, free-market, and even libertarian than any of the other four groups... and not surprisingly, they completely rejected this deal.

But nobody was speaking for the House Republicans; in fact, it appears that nobody was speaking to them, either. So despite the fact that McCain is a senator, not a representative, he nevertheless realized that without the House Republicans (HRs, from now on), no deal would ever be inked. Even though Democrats have a majority in the House (and no filibuster rule), they refused to pass legislation without the "cover" of a majority of the HRs along for the ride. (Which itself is a telling sign: The Democrats did not want to "own" the package.)

Thus, McCain thought it important enough to temporarily (for a few days) suspend his campaign, fly back to D.C. -- which is where his actual job is (and Barack H. Obama's too, by the way) -- and see if he could restart the dialog between the HRs and Everybody Else.

I believe every element of the House plan is worth some consideration in itself, and several would probably help the situation; but I do not believe that even all of them put together would actually resolve the illiquidity of the mortgage markets.

The core of their plan is to get the financial institutions to buy the toxic assets themselves by federally insuring them:

Under the alternative Republican plan, the government would set up an expanded insurance system, financed by the banks, that would rescue individual home mortgages. The government would not have to buy up the toxic mortgage-backed assets that are weighing down financial institutions.

They've also proposed a two-year suspension of the capital-gains tax -- which might actually be counterproductive in the short-term: These toxic assets are of course worth much less than the institutions paid for them; which means if they sell them, they would actually have a capital loss, not gain. Under the current system, they can claim a deduction for that loss; but if we suspend the cap-gains tax for two years, the financial institutions won't be able to deduct their losses.

In the long run, reducing or even eliminating capital-gains tax is a great idea. But it's not going to help in the present crisis.

In the end, I suspect the HRs will relent and compromise: They will accept the guts of the Paulson-Bernanke proposal in exchange for some significant trimming of the Democrats' grab-bag of socialist-populist goodies, particularly including the "equity stake" that the federal government would take in the affected institutions; my reading of the tea leaves tells me this is something that Senate Republicans love but of which House Republicans are very, very skeptical, for the same reasons I enunciated yesterday.

There is already some movement towards a compromise:

Cantor said that some of the "exotic sliced and diced" mortgage-backed securities at issue for the financial institutions are of such little value -- because the underlying mortgages are already in foreclosure -- that using the Republicans' preferred approach of federally insuring them is pointless. "So you've got to go with Paulson's model," Cantor said today, endorsing the federal purchase of those securities to clean up the books for financial firms in distress.

In exchange, Cantor said he is seeking some sort of assurance that that the Treasury secretary would be allowed to create an insurance program for the other mortgages, charging premiums to the firms holding securities tied to those mortgages.

There are some other proposals floating about. Steven Pearlstein in the Washington Post has a very interesting one... Treasury sets up a resolution corporation (as per Paulson-Bernanke); but then instead of buying the illiquid securities with cash, they swap them for preferred stock in the new resolution corporation itself:

My own suggestion would be to structure the rescue around a new government-owned corporation that would be capitalized, initially, with $100 billion in taxpayer funds. The company would use auctions or other mechanisms to buy the troubled securities from banks and other regulated institutions, but instead of paying for them in cash, the government would swap them for an equal number of preferred shares in the new company. (Preferred shares are something of a cross between a bond and common stock.) Those preferred shares would pay a government-guaranteed dividend and could be redeemed by the government at any time. But they could also be used by banks to augment the capital they are required to maintain by regulators.

The beauty of this arrangement is that, rather than protecting taxpayers by having the government take an ownership stake in hundreds of privately owned banks, it would be the banks that would own a stake of the government's rescue vehicle. The government would suffer the first $100 billion in losses from buying and selling the asset-backed securities, but any further losses would be borne by the other shareholders. And should the rescue effort actually wind up making a profit, then the banks would share in that as well.

I don't believe this would have happened without John McCain's presence: It took the support of a man so universally respected on the Republican side, even by those Republicans who frequently oppose him -- ironically, the very same House Republican conservatives whose cause he champions today -- to get the corrupt Democrats and the blowhard Senate Republicans to pay their House brethren any attention at all.

My guess is that many of the HRs' proposals (and several proposals of other critics, such as Pearlstein's "preferred shares" swap) will be rolled into the plan; much of the Democratic garbage will be stripped out; and the guts of the Paulson-Bernanke plan will be enacted with near universal support in both the House and Senate, to be signed by the president into law.

The liquidity crisis will be averted; companies will stop going under; the stock market will rebound (it hasn't dropped all that much, really); the Democrats will be exposed (well, by us, at least) as the venal rats who caused the problem in the first place; President Bush will seem a bit more presidential; John McCain will seem a lot more presidential.

The biggest loser will be, I think, Barack H. Obama, as more and more voters start to ask -- "Who is this guy anyway?"

And he'll lose tonight's debate, too.


These two videos are making the rounds; they fit so perfectly here, I just have to include them.

First, here is the blunt Rep. Roy Blunt (R-MO, 96%), official negotiator for the HRs in the Big Blowout, discoursing on how helpful John S. McCain has been during the negotiations, appointing himself Speaker to Animals... that is, guardian angel for the House Republicans. Watch this one first...



Now, here is the "same" video -- as creatively edited by the Barack H. Obama campaign, or some surrogate. Notice a few very subtle excisions, almost too small even to notice:



Team Obama is pointing to the truncated video to claim that even Roy Blunt agrees that McCain has been nothing but a roadblock, toppling a done deal and plunging America into a dark night of the financial soul.

Want to know just how corrupt, mendacious, and dishonorable is the campaign by the One We Have Been Waiting For, campaigning by what we call "Chicago rules?" That's how.

If in fact they have nothing to do with this disgraceful knife-job on Blunt's praise, there is a simple way to show it: The campaign can denounce this bearing of false witness. Let's see if any such denunciation forthcomes.

Hatched by Dafydd on this day, September 26, 2008, at the time of 6:03 PM | Comments (7) | TrackBack

Brad Weighs In with a Question for Dafydd (and the Massmind)

Congressional Corruption
Hatched by Brad

Our friend and worth co-conspirator against creeping statism, Brad Linaweaver, has a question for me; but I'd like you all to answer as well. This is your forum, too!

Here's Brad:


Regarding the latest McCain/Obama symbolism, aren't we conflating two things? McCain taking some days off from the campaign trail to go back to the Senate during the economic crisis is not the same as McCain canceling his participation in a scheduled debate unless Washington agrees on a deal. Democrats and Republicans are not making this distinction, because all they care about is the purity of their guy and the perfidy of the other guy.

Do you agree with my distinction or not?


Dafydd responds:

Yes, of course they are two separate things. They are distinct. I don't see that it's an important distinction, but it is a distinction.

However, what McCain actually suggested was not to skip but to postpone the debate, just for a few days. I see a much bigger distinction between what McCain said and how Brad characterized it ("canceling his participation in a scheduled debate") than between that postponement request and the decision to work on the liquidity catastrophe rather than jet around the country giving stump speeches. He was only saying that these negotiations were intense enough that he might not be able to break away from them in the middle... or he might, depending on how much progress had been made.

In any event, as you see, there was sufficient progress that McCain feels comfortable flying down to Mississippi for the debate, and then flying right back up to paradise on the Potomac; so the question is to some extent mooted.

But honestly, I really don't think that it's very important whether the debate is held tonight or next Tuesday or Wednesday night... which is really all that the debate flap was ever about.

All right, anybody else who wants to toss in your two centavos in the comments, feel free.

Hatched by Brad on this day, September 26, 2008, at the time of 4:29 PM | Comments (2) | TrackBack

September 25, 2008

Democrats Channel Hugo Chavez in Rescue Demands

Congressional Corruption
Hatched by Dafydd

It appears a deal in principle -- but perhaps an unprincipled one -- has been struck on the Paulson-Bernanke market-rescue plan. Early reports are that the Democrats demanded and received two very dangerous concessions as their price to agree to prevent the complete disintegration of the American economy:

  1. Some sort of government control of compensation (salary, bonuses) on the salaries of executives of companies embroiled in this crisis;
  2. Much worse, the government would gain an "equity interest" in those companies.

Squeaker of the House Nancy Pelosi (D-Haight-Ashbury, 93%) says the deal is done:

House Speaker Nancy Pelosi, D-Calif., said Bush's agreement with Democrats on limiting pay for executives of bailed out financial institutions and giving taxpayers an equity stake in the companies cleared a significant hurdle.

But in a miracle of clear and concise journalism, the same article claims -- two paragraphs later -- that it's still under discussion:

It was not yet clear how lawmakers had resolved lingering differences over how to phase in the eye-popping cost - a measure demanded by Democrats and some Republicans who want stronger congressional control over the bailout - without spooking markets. A plan to let the government take an ownership stake in troubled companies as part of the rescue, rather than just buying bad debt, also was a topic of intense negotiation.

Don't we love the feeling of security we get from those multiple layers of editing at the elite media? The New York Times weighs in, saying that it is indeed part of the plan:

But lawmakers in both parties said that few substantive differences and no major obstacles remained....

They also said that there would be limits on pay packages for executives whose firms seek assistance from the government and a mechanism for the government to be given an equity stake in some firms so that taxpayers have a chance to profit if the companies prosper in the months and years ahead.

The latter especially is a key element of Woodrow Wilson, Benito Mussolini style fascism; it invariably leads to the State, as the $700 billion gorilla on the board of directors, exerting overwhelming control over corporate decisions... which it will exercise on the basis of politics, not profits.

When people read "fascism," they immediately tend to envision concentration camps, jackboots, and Nazis goosestepping at mass rallies; but the real danger of fascism, especially liberal fascism (fascism with a smiley face, as depicted -- against author Jonah Goldberg's wishes -- on the cover of his book Liberal Fascism), is government control of corporations. The more control is handed over to politicians and bureaucrats who have no hand in actually producing the product (loans and securities, in this case), the more critical decisions will be made on irrelevant political considerations, often leading to financial disaster... and another bailout, leading to even more government control. Eventually, the State completely hijacks the corporation for political purposes... and we're well on our way to Hugo Chavez-land.

Imagine the possibilities!

  • The next Democratic president could threaten to order American banks and financial institutions to completely divest from Israel, in order to "pressure" Israelis to accept a suicidal deal with Hamas and Hezbollah terrorists.
  • The administration can flex its "equity stake" to force companies to offer benefits to same-sex partners on the same basis as spouses.
  • It can bully the companies it partially owns into ruinous union contracts, into making corporate donations to 527s, pressure executives into raising campaign cash for favored candidates... and it can certainly demand sweetheart loans to the very politicians who inherit such unearned power -- from the crisis they themselves created, à la Countrywide's deal with Chairman of the Senate Committee on Banking, Housing, and Urban Affairs Chris Dodd (D-CT, 93%).

There are some things that could be done to partially mitigate the horrific damage to free markets by government ownership of the nation's financial institutions. I would hope, even if Democrats demand an equity stake before they will agree to rescue the American economy, that conservative Republicans can at least limit that stake to non-voting stock, and put in place oversight that prevents some representative of the next administration from sitting on the institution's board of directors.

I don't know how long such limitations may last; the next president could still intimidate the company into political compliance by threatening to dump equity at "going out of business" prices (literally!), tanking the market capitalization. But it might hold back the tide of liberal fascism for a little while.

John S. McCain appears to be concentrating his efforts on responding to the oversight and spending misgivings of conservatives about this deal and getting some of their ideas incorporated into the deal; he is thus corralling their support for the eventual deal:

Rogers said McCain didn't participate in that [negotiation], but was in talks with Republican leaders afterward. Conservative Republicans were among the holdouts, and there were indications they were waiting for McCain to make a move before they did.

As Thursday began, McCain said he didn't believe the administration's plan had the votes to pass without changes. "We are running out of time," McCain said. However, he said he still was confident a bipartisan compromise could be reached before markets open on Monday, one that would stabilize the markets, protect taxpayers and homeowners and "earn the confidence of the American people."

Meanwhile, Barack H. Obama is showing his own kind of leadership, demonstrating what an Obama administration would actually be like:

For his part, Obama urged a swift resolution that would get the legislation passed, saying "action must be taken to restore confidence in our economy ... Now is a time to come together -- Democrats and Republicans -- in a spirit of cooperation on behalf of the American people."

Obama also rolled out a new 60-second TV ad to run in "key targeted states" in which he cited economic policies endorsed by Bush and McCain as essentially to blame for the troubles.

"For eight years we've been told that the way to a stronger economy was to give huge tax breaks to corporations and the wealthiest. Cut oversight on Wall Street. And somehow all Americans would benefit," Obama says in the ad. "Well now we know the truth. Instead of prosperity tricking down, the pain has trickled up. We need to change direction. Now."

Evidently, Obama believes that Democrats and Republicans should "come together" to cooperate on covering up for Democratic complicity in this crisis by slandering Republicans.

In fact, we already know who caused this problem... and we also know who is trying to resolve it, and who is trying to use the crisis to extort more socialist populist policies to damage the capitalist system.

Once McCain has satisfied himself that he has modified the deal enough to bring conservatives in Congress aboard, and that the deal is going to pass, he will return to full-blown campaign mode; and I hope he then releases his own advert, along the lines I suggested in the first link in the paragraph above, explaining how this crisis actually came about: through Democratic market manipulations and interventions for populist-political, non-economic reasons (giving other people's money to the poor to buy votes). The truth from McCain will surely be much more believable and convincing -- than Obama's handwaving, boilerplate fantasies about "huge tax breaks to corporations."

Hatched by Dafydd on this day, September 25, 2008, at the time of 3:23 PM | Comments (3) | TrackBack

September 23, 2008

Democrats: the Party of Fiscal Prudence and Political Streamlining

Congressional Corruption
Hatched by Dafydd

Democrats bolster their already sky-high reputation for fiscal responsibility

The Democrats are skeptical, even suspicious. They're not going "simply hand over a 700-billion-dollar blank check to Wall Street and hope for a better outcome," as Squeaker of the House Nancy Pelosi (D-Haight-Ashbury, 93%) said, referring to the rescue plan proposed by Secretary of the Treasury Henry Paulson and Chairman of the Federal Reserve Ben Bernanke:

Lawmakers said brisk talks toward a deal by week's end included an agreement that the US Treasury could acquire some equity from banks in exchange for bailing out bad debts, and an accord on an oversight plan.

But as markets plunged amid impatience and uncertainty with the process, some senior politicians warned they would not be hurried into agreeing to the biggest US bailout since the Great Depression of the 1930s.

No pig in a poke for them!

Chairman of the Senate Banking Committee Chris Dodd (D-CT, 93%), has already pronounced the Paulson-Bernanke rescue plan D.O.A.:

Getting the action right is key, Dodd said: "There is no second act to this." He later spoke disparagingly of the administration's proposal. "What they have sent us is not acceptable," he told reporters.

Sen. Chuck Schumer (D-NY, 95%) is well known for his prudence in spending taxpayer money. He believes the price tag of $700 billion -- he means spending authority, of course, since much of that money will be made back when the resolution corporation auctions off the newly revalued assets it acquired at discounted prices -- is simply too high; he wants to save the government money:

Paulson, seated next to Bernanke at the Senate hearing, objected strongly when Chuck Schumer, D-N.Y., asked if $150 billion might be enough to get the program started, with a promise of more to come.

In fact, they're so concerned about spending so much money without adequate debate, discussion, and without the American people being able to see exactly what we're getting, that they're willing to debate until the cows come home to roost, rather than rush into some massive spending authorization. After all, they haven't even seen the full plan on paper yet!

It should be clear by now that the Democrats are the party which can be trusted to be good stewards of the people's money, spending hawks, and champions of spending transparency.

Democrats: Politics you needn't worry your pretty little head about

In a completely unrelated story that we're including in this post only because of space limitations, efficiency-minded Democrats in Congress are attempting to push through a $488 billion omnibus spending bill:

Congress is scrambling to pass the Pentagon budget, aid for flood and hurricane victims and $25 billion in loans for Detroit automakers in a late-session burst of activity that's flying under the radar compared with efforts to bail out Wall Street.

Funding for veterans health care and homeland security programs is also in the mix as Democratic leaders ponder what other items should catch a ride on must-do legislation to keep the government running beyond the Oct. 1 start of the 2009 budget year.

A stopgap bill must pass to avoid a government shutdown, so Democrats are viewing it as a locomotive to pull past a skeptical White House measures such as the automaker loan and a doubling of home heating subsidies for the poor.

Enough blah-blah... the people want action, action, action!

In an effort to speed up the process (and not allow the opposition to confuse matters by participating in the discussion), they are crafting the bill entirely within the Democratic caucus, bypassing the contrarian Republicans and not letting them amend the bill -- or read it -- before the final vote. For even more streamlining, Democrats have eschewed informing Americans of each and every piddling detail, so as not to bore or confuse them:

Details of the emerging legislation remain secret, but its outlines have come out in interviews with aides to both the House and Senate Appropriations committees, as well as aides to top House and Senate leaders.

The legislation is coming together in a remarkably secretive process in which decisions are concentrated in the hands of just a few lawmakers such as House Speaker Nancy Pelosi, Senate Majority Leader Harry Reid and House Appropriations Committee Chairman David Obey, D-Wis.

To better service their constituents -- the people, not the powerful -- they have helpfully included many billions of dollars of congressionally directed spending, which they have inserted after strong, bicameral debate in joint conference between the House Democrats on the one hand and the Senate Democrats on the other:

The unusual process means thousands of lawmakers' pet projects of the very sort blasted by GOP presidential nominee John McCain on the campaign trail would escape scrutiny, including up to $5 billion worth of such "earmarks" in the defense budget alone.

It should be clear by now that the Democrats are the party that can govern swiftly and unobtrusively, unencumbered by odious and divisive Republican demands for "democracy"... and the party that can keep a secret!

The Democratic caucus: A little something for everybody.

Hatched by Dafydd on this day, September 23, 2008, at the time of 6:07 PM | Comments (4) | TrackBack

September 22, 2008

Democrats Try to Hijack the So-Called "Bailout"

Congressional Corruption , Toxic Jackassets
Hatched by Dafydd

Republicans see the collapse of the mortgage market as a potential catastrophe that requires emergency measures... but an aberration caused by government intrusion into the market, not an indictment of capitalism and free markets.

Democrats see it as proof positive that capitalism has been proven to be a fad that will soon pass away, like pet rocks... and a golden opportunity to reintroduce failed liberal fascist economic policies straight out of the platforms of Woodrow Wilson, Franklin Roosevelt, and Jimmy Carter.

Which George W. Bush will show up... the veto-wielding Bush with a spine that we've seen in Democratic spending legislation after the 2006 elections -- or the wimpy, appeasing Bush that we've seen in legislation on racial preferences, Israeli-Palestinian "negotiations," and Republican spending prior to the 2006 elections? The choice will spell the difference between a small-footprint intervention or a massive repudiation of decades of progress on free-market economics.

But first, let's again talk about how we got into this mess.

Subprime mortgages, securitization, and toxic assets

This is the crux of the crisis: Back in the cretaceous period, when a bank or S&L issued a mortgage, it held that mortgage until the borrower paid it off. But in the contemporary era, what starts out as a mortgage is typically bundled with other mortgages into a "mortgage-backed security" (MBS) -- essentially bonds that can be traded on the open market. Bizarrely, in the process, bad debt automagically becomes good investment.

How are MBSs created? Let me quote from an excellent sumary in a newsletter by John Mauldin (free registration required):

Let's jump back 18 months. I spent several letters going over how subprime mortgages were sold and then securitized. Let's quickly review. Huge Investment Bank (HIB) would encourage mortgage banks all over the country to make home loans, often providing the capital, and then HIB would purchase these loans and package them into large securities called Residential Mortgage Backed Securities or RMBS. They would take loans from different mortgage banks and different regions. They generally grouped the loans together as to their initial quality as in prime mortgages, ALT-A and the now infamous subprime mortgages. They also grouped together second lien loans, which were the loans generally made to get 100% financing or cash-out financing as home owners borrowed against the equity in their homes.

Typically, a RMBS would be sliced into anywhere from 5 to 15 different pieces called tranches. They would go to the ratings agencies, who would give them a series of ratings on the various tranches, and who actually had a hand in saying what the size of each tranche could be. The top or senior level tranche had the rights to get paid back first in the event there was a problem with some of the underlying loans. That tranche was typically rated AAA. Then the next tranche would be rated AA and so on down to junk level. The lowest level was called the equity level, and this lowest level would take the first losses. For that risk, they also got any residual funds if everyone paid. The lower levels paid very high yields for the risk they took.

Then, since it was hard to sell some of the lower levels of these securities, HIB would take a lot of the lower level tranches and put them into another security called a Collateralized Debt Obligation or CDO. And yes, they sliced them up into tranches and went to the rating agencies and got them rated. The highest tranche was typically again AAA. Through the alchemy of finance, HIB took subprime mortgages and turned 96% (give or take a few points depending on the CDO) of them into AAA bonds. At the time, I compared it with taking nuclear waste and turning it into gold. Clever trick when you can do it, and everyone, from mortgage broker to investment bankers was paid handsomely to dance at the party.

So what started as mortgages -- ranging from very secure prime mortgages, which are doing fine, to lousy subprime mortgages for too much money to borrowers who really didn't have either the credit history or income to justify such loans, many of which are currently in default 60 days or more -- were, by the magic of "securitization," turned into bond-like securities; and in the process, many of the bad and even defaulted loans were transmaugrified into AAA-rated investments.

The banks and other financial institutions that securitized mortgages (and resecuritized already securitized MBSs) would make their nut by skimming some percent, typically fifty basis points (0.5%), off the loan rate; thus, if they began with a package of mortgages at 6.5% (they tried to bundle like with like), they would securitize them into an MBS that paid 6%, keeping the difference -- and hoping there would be few enough defaults that the mortgages would produce more than 6% net.

What happens when loans are defaulted is very complicated and not really germane to this post; they created different tiers, or "tranches," with different ratings -- AAA down to junk -- for different prices, that distributed the losses from worst tranch up to best. Not important here.

But defaults, of course, are where the whole pyramid scheme broke down. While housing prices continued to rise, everybody was happy and there were few defaults. But starting a couple of years ago, when the housing bubble burst and the mortgage default rate shot up, a bunch of banks found themselves holding very insecure securities, losing money hand over teakettle. The crash began among the lenders and spread to secondary markets (the MBSs and CDOs) and even tertiary markets (insurance underwriters like AIG). In short order, institutions all over the world found themselves holding pieces of paper whose value was impossible to determine -- which are referred to as toxic assets.

Toxic assets are illiquid, meaning they cannot be bought or sold because nobody knows how much to offer for them; they are frozen. If you hang onto them, they might regain some value later... or they could disappear completely. Worse, illiquid securities see their ratings drop; and current law forbids some types of funds from holding anything but AAAs... which means they may be forced by law to sell -- but unable to sell because of illiquidity!

Not only that, but current law also requires that such securities be "marked to market," meaning they must be valued at the last price offered by some institution that was desperate to sell -- because of the law in the previous paragraph. Thus, even institutions that didn't have to sell their toxic assets had to reprice them; this meant that a number of financial institutions suddenly did not have sufficient reserves for the amount of loans or leveraging they had out. That meant they needed to get hard cash and fast... which meant they would have to panic-sell a bunch of securities, precipitating a new round of re-rating and re-valuating.

Eventually, nobody had a clue what anything was worth anymore; and nearly every financial institution in the world, it seems, was involved up to the fourth cervical vertebra in this mess.

It was that uncertainty that caused the mortgage market to collapse. It's like trying to buy a car when all you can see is a grainy photo in a newspaper: You can't test-drive it, inspect it, or even kick the tires. You don't even know whether it contains an engine... how can you possibly make any kind of offer whatsoever?

Worse yet, the seller has never seen the car either, and he knows no more about it than you!

So what is to be done? Obviously, since the problem is the inability to set a value for these instruments, which makes them impossible to buy or sell (illiquid), the solution is to find a way to value them. Enter the Paulson-Bernanke emergency rescue plan.

Treasury presses the reset button

As proposed by Secretary of the Treasury Henry Paulson and Chairman of the Federal Reserve Ben Bernanke, the putative "$700 billion" "bailout" is actually neither: It will neither cost that much, nor will it bail out those financial institutions that wrote bad loans for people they knew were not likely to be able to pay them off.

As I understand it, here is the basic plan. Note that I'm drawing this from many sources, it's not yet written in stone -- or even in ink -- and I can't give you sources. If you want more information, you're on your own! But here is what I've been able to glean:

  1. The Treasury is given authority to spend up to $700 billion (outstanding at any particular moment) to buy MBSs, CDOs, and related instruments that have become "illiquid." These "toxic assets" will be purchased from their current owners at a huge discount... meaning the banks and other investors who purchased these pigs in pokes will, in fact, take a significant financial hit... they're not being "bailed out."

So the Treasury can buy up these toxic assets; what do they do with them?

  1. I believe the plan (which has not yet been formalized in legislation) is to create a Treasury owned and managed resolution corporation that will take ownership of these toxic assets. Analysts will then pore through each MBS, determining the status of all the underlying mortgages and making a report publicly available. This will make the opaque assets completely transparent. All the financial fundamentals will be visible, so analysts at private companies can examine all of the securities and decide how much they would pay for each.
  2. The resolution corporation will then auction off each of the the now-transparent MBSs, selling it to the highest bidder; that very action allows the market to reset the value of the security.

That is why I characterize this rescue operation as "pressing the reset button."

Once some corporation has examined the fundamentals of the security and offered the winning bid for it, the MBS becomes (by definition) liquid; it is no longer a toxic asset. Its value has been reset... and it can go up or down after that point based upon subsequent, well-understood events (defaults, repayments, prepayments) in the underlying mortgages and reevaluations based upon other, market-based criteria. In other words, it becomes just like a mutual fund.

The crisis was the inability to value MBSs; the solution is to reset their values. The beauty of the Paulson-Bernanke plan is that this resetting is done by the free market, not by government decree.

Finally, note this point:

  1. When the Treasury-owned resolution corporation auctions off the now-transparent MBSs, it can use that money as income. Since the asset is now much more valuable than before (having been scrubbed into transparency), if it becomes saleable, then it will certainly sell for more than the discounted rate at which the corporation bought it. In other words, the resolution corporation will make a profit on every security it resells -- so the program will not actually cost $700 billion... it may even end up completely in the black.

That's why the Paulson-Bernanke plan is neither a bailout -- the so-called beneficiaries in fact must pay dearly for their folly -- nor massively expensive, since it resells most of the securities it bought, and at a profit. It could still end up costing money, depending on how many of the MBSs end up still toxic even after the complete report (if too many of the underlying mortgages are in default, for example); but the losses won't be anywhere near $700 billion, and they may be less than the profits.

Democrats: fingers in the pie, finger in your eye

But the loyal opposition is not content to use the Paulson-Bernanke emergency mortgage-market rescue plan to rescue the mortgage market from the current emergency; how dull that would be, especially in an election year. Rather, they see America's crisis as their opportunity to enact or re-enact by extortion every awful, failed, thoroughly discredited, socialist-populist scheme they have tried, or always wanted to try, over the past century. Senate Democrats demand:

  • Contingent stock in every, single company that sells its toxic assets to the resolution corporation; this would give the federal government a degree of ownership of virtually every bank, savings and loan, or other financial institution in the entire country. It is liberal fascism at its purest, and it would lead directly to much greater government control of private capital.
  • They demand that bankruptcy judges be allowed to rewrite the terms of the underlying mortgages, in order to "provide direct assistance to homeowners caught in the foreclosure crisis"... in other words, to allow people who took out loans much too big for houses they could not afford to nevertheless keep those houses, even though they cannot make the payments. All at the expense of financial institutions that are teetering at the brink as it is.
  • Democrats demand "limits on the pay of top executives whose firms seek help." That is, Congress would set the salaries and bonuses of executives working at companies that are in serious trouble because of the mortgage meltdown... and that's always worked out so well in the past!
  • They also have structural demands:

    The 44-page Senate proposal, pulled together by Senator Christopher J. Dodd, Democrat of Connecticut and the chairman of the banking committee, would require the Treasury to run the rescue plan through a new "Office of Financial Stability" to be headed by an assistant treasury secretary. It would also establish an "Emergency Oversight Board" to monitor the bailout effort, made up of the Fed Chairman, the chairman of the Federal Deposit Insurance Corporation, the chairman of the Securities and Exchange Commission; and two non-government employees with "financial expertise" in the public and private sectors, one each appointed by the majority and minority leadership in Congress.

    In addition, the Senate proposal would require monthly reports to Congress, rather than the biannual reports that would be required under the Bush administration’s proposal.

    This sounds like an invitation to micromanagement -- and unless I miss my guess, the "Emergency Oversight Board" will somehow end up stuffed with former members of the Clinton administration and/or Barack H. Obama's campaign, like Franklin Delano Raines, James Johnson, and Jamie Gorelick... the same people who ran Fannie Mae and Freddie Mac into the ground and ran many of the very multinationals that offered subprime loans, hedge-funds and other derivatives, or that insured these toxic assets, thus creating the crisis in the first place.

  • While former Clintonista (and now Charlie "Tax Ducker" Rangel's lawyer) wants the Democrats to go even further:

    Barack Obama has tried to run as a unifying centrist. Now it may be time for him to clear the fog and talk, walk and sound like a true FDR liberal -- reminding the American people that at times like this, the government is a friend, not an enemy, contrary to conservative theology. Indeed, now may be the time for him and the Democratic Congress -- urged on as recently as Thursday by Treasury Secretary Henry Paulson -- to take the next 30 days to enact something reminiscent of FDR's first 100 days. It should be more than just a $700 billion bailout. It should also include billions to help homeowners avoid foreclosure, to assist the auto industry, to upgrade the nation's infrastructure, and to spur development of alternative energy sources.

One can always trust Democrats to find a way, in any crisis, to throw gasoline at the bull.

President Bush (and the upcoming President John S. McCain) must remain stalwart and demand an up or down vote on a clean version of the Paulson-Bernanke rescue plan... no add-in spending, no wage and price controls or upgrading the nation's infrastructure, and specifically, no damned earmarks.

Anything less than this standard of rectitude and disinterested statesmanship would be an economic betrayal of America... and must lead to electoral ruin for any party which puts immediate self-gratification ahead of national economic survival.

Hatched by Dafydd on this day, September 22, 2008, at the time of 4:23 PM | Comments (30) | TrackBack

September 18, 2008

And While We're On the Subject of Capitalism...

Congressional Corruption
Hatched by Dafydd

How about this from that long-time champion of free markets, the New York Times?

In extending a last-minute $85 billion lifeline to American International Group, the troubled insurer, Washington has not only turned away from decades of rhetoric about the virtues of the free market and the dangers of government intervention, but it has also probably undercut future American efforts to promote such policies abroad.

I think that Washington D.C. "turned away from decades of rhetoric about the virtues of the free market" a long time ago -- say, back in 1977, when Democrats overwhelmingly passed Jimmy Carter's Community Reinvestment Act.

That act of semi-nationalization of banking directly precipitated the collapse of the mortgage market, leading to the collapse of several secondary investment groups (e.g., Lehman Brothers, Bear Stearns, Merrill Lynch) who bought the "securities" (that is, repackaged bad mortgages) offered by Fannie Mae and Freddie Mac... as well as the insurers, such American International Group, duped into guaranteeing them.

When the government has already intervened in a market, distorting and corrupting it beyond the point of no return, then obviously it takes another act of government to get the government out of the business of trying to run the banking industry and back to something more or less approaching a free market. Statist intervention never fades away on its own; like the hydra, each individual head must be severed, and the stumps must be seared with hot iron.

And by the way; since when does the collapse of a fraud-laden insurance company -- whose nearly 40-year CEO Maurice Greenberg was ousted in 2005, whose top executives were subsequently criminally prosecuted, and which was forced to pay a $1.6 billion fine for its fraudulent accounting practices... all years before the Freddie-Fannie crisis -- implicate "the virtues of the free market?" The only thing implicated with AIG is the lack of adequate supervision of yet another Statist scheme pushed by Democrats... who now abdicate all responsibility for fixing the problem they, themselves created!

Only economic imbeciles who imagine that a free market means no regulation whatsoever -- including no laws against fraud, embezzlement, theft, tax evasion, or obstruction of justice -- could make such a leap of bad faith.

Which evidently includes the New York Times and everybody who shares its thinking. And while I hate to judge before all the facts are in, that would appear to implicate, not free-market economists, but liberals, socialists, liberal fascists, and other Democrats.

Or did I miss some big, deathbed conversion by Milton Friedman to Keynesianism?

Hatched by Dafydd on this day, September 18, 2008, at the time of 4:32 PM | Comments (4) | TrackBack

By "No One," He Means...

Congressional Corruption
Hatched by Dafydd

How helpful -- and I mean that sincerely:

The Democratic-controlled Congress, acknowledging that it isn't equipped to lead the way to a solution for the financial crisis and can't agree on a path to follow, is likely to just get out of the way.

Lawmakers say they are unlikely to take action before, or to delay, their planned adjournments -- Sept. 26 for the House of Representatives, a week later for the Senate. While they haven't ruled out returning after the Nov. 4 elections, they would rather wait until next year unless Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke, who are leading efforts to contain the crisis, call for help. [In the meanwhile, Americans with pensions, investments, houses, or who pay taxes can just go hang.]

Hip hip, chin chin, we're all for the Democrats getting out of town early; so long as Senate Majority Leader Harry "Pinky" Reid (D-Caesar's Palace, 85%) and Squeaker of the House Nancy Pelosi (D-Haight-Ashbury, 93%) are sitting in their magisterial thrones issuing decrees (such as, "we have already lost this war" or "Democrats bear no responsibility for this economic crisis"), no one is safe. And especially no one's wallet.

In fact, we emphatically agree with Sen. Johnny Isakson (R-GA, 96%):

"The last thing you need,'' he said, "are 535 people, not many of whom are that well-versed in financial markets, trying to do quick fixes to a market correction that's one of the more significant that we've ever seen.''

But I found Sen. Reid's explanation for why he and the Speaker should get the heck out of Dodge in a week or two unintentionally hilarious:

One reason, Senate Majority Leader Harry Reid said yesterday, is that "no one knows what to do'' at the moment.

No one? Somehow I can't shake the suspicion that by "no one knows what to do," Sen. Reid really means "none of us liberals knows how to deal with this crisis... other than by dismantling Jimmy Carter's Community Reinvestment Act, that forces banks to make bad loans to poor people who can't pay the mortgage; and we just can't imagine ever agreeing to such a drastic affirmation of free-market Capitalism and the American way!"

  1. If the National Republican Congressional Committee and the National Republican Senatorial Committee don't run against the Democrats on the issue of their abdication, disconnect, and denial on the single greatest economic crisis of their brief tenure running Congress, then Republicans are insane.
  2. Republicans are not insane.
  3. Ergo, they will run on this issue, and run hard and deep.

I am astonished that the Democrats have simply left this door wide open. But for heaven's sake, let's charge through it, before Nancy and Pinky come to their senses!

For one example, I hope the Republicans quickly put together the best ideas from their own last several attempts to overturn the CRA, reform plans that were very well thought out and would have helped immeasurably:

  • Start with the Gramm deregulation of 1999 (which removes the requirement that banks must make those bad loans);
  • Add back in a certain amount of the regulation proposed by President Bush in 2003, which we now realize is necessary when corrupt Clintonite Democrats run Fannie Mae and Freddie Mac;
  • Finally, pore through the 2005 reform co-sponsored by John S. McCain and Sens. Chuck Hagel (R-NE, 79%), Elizabeth Dole (R-NC, 92%), and John Sununu (R-NH, 84%) for any good ideas not already covered.

We would then have a very strong, effective, and attractive reform bill. Call it the Fix Your Fannie Act of 2008.

...Which the Democrats would certainly refuse to return to Congress to vote upon, thus giving Republicans in Congress and McCain a perfect platform to demonstrate that it is they, not the corrupt-to-the-core Democrats or Mr. Chicago Machine, Barack H. Obama, who are the real reformers on this bus.

Hatched by Dafydd on this day, September 18, 2008, at the time of 1:46 PM | Comments (1) | TrackBack

August 1, 2008

Democrats to Drivers (Bus Riders, Truckers, etc): Drop Dead

Congressional Corruption , Future of Civilization , Future of Energy Production , Future of Food , Future of Transportation , Liberal Lunacy
Hatched by Dafydd

A most extraordinary exchange occurred yesterday in the august halls (thought it was still July) of the United States Senate. (Hat tip to Hugh Hewitt, who played this on his show today.)

It shows the Democrat in his natural environment: Complete disdain for working Americans, and utter indifference to their problems... but slavishly doting upon the various interlocking special interests that prop up the Democratic Party, like creeping vines holding a crumbling facade in precarious balance.

Just take a look-see:



Sen. Ken Salazar's (D-CO, 85%) message is stark: There is no gasoline price level, no matter how dear, beyond which Democrats will actually support drilling for more domestic oil. None. It could go to $100 a gallon, and they would still fold their arms and, like Khrushchev at the U.N., bark "Nyet!

Current projections from the "pundants" (as President George W. Bush calls them) are that Republicans will be slaughtered in November. Democrats are still talking about a "filibuster-proof majority" in the Senate, or even "veto-proof" majorities in one or both houses.

I say that's nonsense: If we can focus like a laser beam on issues like energy, taxes, the economy, jobs, winning the Iraq and Afghanistan wars, reforming immigration (including legal immigration), and confirming judges who won't rewrite the Constitution to fit the current fashion trend... then I say we can reduce the loses to negligible -- and maybe even nab a net seat in the Senate, if we can hold our own and pick off Sen. Mary Landrieu (D-LA, 80%). So far, the GOP is running a terrific campaign for the congressional races, and John S. McCain is running a pretty good campaign for president (still room for improvement there).

It's time, time for conservatives to come back and put country ahead of their own power within the party; it's time to come together, fight to take back Congress and retain la Casa Blanca -- then all Republicans must make reparations for their complete meltdown from 2004-2006, when they became as corrupt as the Democrats.

A good start would be for the GOP, either overtly or covertly, to support some other candidate other than incrumbent Sen. Ted Stevens (R-AK, 64% -- poster-boy for the corruption of the flesh of swine) in the Alaska primary later this month.

Hatched by Dafydd on this day, August 1, 2008, at the time of 8:25 PM | Comments (2) | TrackBack

June 6, 2008

"What's Bad for General Motors Is Good for the DNC!"

Congressional Corruption , Econ. 101 , Energy Woes and Wows , Future of Energy Production , Presidential Campaign Camp and Porkinstance , Tax Attax
Hatched by Dafydd

Over at Real Clear Politics, Tom Bevan speaks for nearly all pundits, spread across three parties unto the tenth generation, when he writes:

Of course, the worse the economy gets, the better it is politically for Obama...

This is Conventional Wisdom 101. But why? What is the connection?

CW 102 explains CW 101 by postulating the following syllogism:

  1. Economy heads south;
  2. Voters decide to blame the "party in charge" and punish them at the polls;
  3. The elite media always declare that the party in charge is the Republican Party;
  4. Thus, the voters will inevitably punish the GOP (and the country) in November by voting Democratic. It's elementary!

The truly sad thing is that Democrats actually do believe this; they believe what's bad for America is good for them, because they can play "pin the blame on the elephant" and parlay some terrible catastrophe -- an earthquake, an act of terrorism, an economic challenge -- into furthering their congressional careers.

But there's something kind of weird about this syllogism... for some odd reason, whenever anything bad happens that (we are told) will earn the ire of the electorate against the party in charge -- it always seems to turn out that the responsible party is the Republican Party.

Today the voters will blame the GOP because, while Democrats control Congress, a Republican sits in the White House. But conversely, back in the 1990s, the voters blamed the GOP... after all, while a Democrat sat in the White House, it was the Republicans who controlled Congress!

I understand why the elite media would always blame Republicans for anything bad; they're knee-jerk New Left liberals who vote 93% for Democrats.

I even understand why commentators on the right so often assume voters will blame the Republicans: First, they see all the other pundits around them blaming Republicans, and if they did the opposite, they would experience cognitive dissonance; second, Republicans by their very natures tend to be dour and pessimistic... so much so that they, themselves, reflexively assume that everything that can go wrong will... and even things that can't go wrong will find a way to do so anyway.

You just watch: The closer we slide to the election, the more depressed and apocalyptic will be the Republican and conservative columnists, talking heads, and bloggers, no matter what the facts on the ground may be; the perennial pundits' pessimism and pity parade will once again take over Fox News Channel, the WSJ and the Washington Times, the Weekly Standard and the National Review, and virtually the entire dextrosphere.

In terms of Republican Party temperment (as opposed to policy), Ronald Reagan is the exception; Richard "They're coming to take me away, ha ha!" Nixon is more the rule.

But understanding a bizarre psychological syndrome of conspiracy and defeat is not the same as believing it. Here's a new syllogism that begins from my own core political belief:

  1. Contrary to what the Left thinks, ordinary voters are not utter fools;
  2. If the economy goes south, they will want to punish the predators and incompetents who caused it to go south;
  3. Whichever party is best able to make a logical and rational argument that the economic problems are caused by the policies of the other guys will be rewarded at the polls;
  4. The biggest economic problem today is the ludicrously high cost of fuel, which is driving up the price of virtually everything else;
  5. The primary cause of that high cost is legislation preventing us from exploiting our own energy resources;
  6. The party responsible for that legislation is the Democratic Party, not the GOP;
  7. Thus if John McCain will actually articulate that argument and run on policies that would significantly increase our energy production -- something that Barack H. Obama will not, cannot do -- McCain has a very good shot at actually being rewarded by voters in November;
  8. Even better, if the GOP across the board were to run on that platform in congressional, gubernatorial, and other races, it might mitigate by future-policy promises the "bad branding" that threatens to decimate Republicans once again, as it did in 2006.

The only really big "ifs" in this syllogism, I believe, are the last two points, (7) and (8). So far, neither the presumptive Republican nominee nor Republicans running for reelection has embraced the stark difference between the two parties: In general, the GOP defines success through growth and expansion -- while Democrats define their success through contraction, contrition, and condemnation of everything American.

But right now, McCain is still stuck on globaloney hysteria, while Republican congressmen running for reelection stand on the brink of accepting the Devil's bargain that the California GOP bought into long ago: Accepting permanent minority status in exchange for perpetual reelection. This is the basest of bargains: GOP incrumbents get their perks, and we get punked.

You can't recapture Congress by graciously conceding defeat -- months before the election!

Boldness is what we need now: Instead of accepting our political dhimmitude at the hands of Majority Leader Harry "Pinky" Reid (D-Caesar's Palace, 85%) and Squeaker of the House Nancy Pelosi (D-Haight-Ashbury, 93%, not counting missed votes), we must risk everything on a real campaign to take back the Congress.

The GOP needs a new national strategy, similar in some ways to the Contract With America in 1994; but that contract was entirely procedural and inside-baseball. What we need today is a substantive national strategy.

Obama has his "American Moment" speech; fine. But for those of us who want America to last more than a moment, let's have a strategy based around the theme, Vote For an American Future:

1 - Vote for American energy for America and our friends

America is an energy nation: We use a lot, but we have a lot more reserves than we're allowed by law to tap.

We need to drill for oil everywhere on American territory where oil is to be found, as well as in international waters; but we'll use American high-technology to drill in an environmentally safe and sound way.. Produce energy for America, while preserving nature's beauty for all Americans.

With oil above $130 per barrel and people feeling the pinch everywhere, we no longer have the luxury of leaving our oil fields and natural gas mines unexplored and untapped. We must drill in the Bakken oil formation, off the two coasts, in ANWR, in the Gulf of Mexico, in international waters in the Caribbean and elsewhere. We mine oil shale and extract the oil. We mine for natural gas. We begin building smaller nuclear reactors using the safest of modern designs... and the federal government should insure them.

2 - Vote for an economy of wealth, not illth

A simple rule that applies universally: You cannot tax yourself into prosperity. We need some form of taxation to pay for things we need; but we don't need taxes to "level the playing field" by crippling successful people so that life's losers don't feel so bad.

Unless we make the tax cuts permanent, they'll expire (the Democrats forced that poison pill on us)... resulting in the largest tax increase in American history. But we need to go farther: We need to eliminate the alternative minimum tax altogether, cut the capital-gains tax to zero, and shift to a "fair tax" flat tax.

And we "pay for" these tax cuts, not with more tax increases, but by actually cutting spending -- reducing entitlements (see 4 below) and trimming unnecessary government departments and agencies -- and by growing the economy, letting Americans keep, spend, and invest more of what they earn.

3 - Vote for security, not surrender

We stand at a tipping point of history: We have it in our power to destroy the Iran/al-Qaeda axis and secure not just America but the West for decades. But we need to mobilize more than just our military, brilliant as it is. This existential struggle cannot be won by bullets and bombs alone.

We need to bring together defense, diplomacy, intelligence, and the ideology of freedom in this world-wide conflict. Americans instinctively distrust "nation building;" but that makes us ideal stewards to help failed states in the "non-integrated gap" to rebuild their own nations -- with our support and know-how.

We must completely rebuild our intelligence agencies from the ground up. They have failed terribly in recent years, but not because of the men and women who work tirelessly to get inside our enemies' heads. They failed because we're asking our intelligence agencies to do things they were never designed to do; they were birthed during the great wars of the twentieth century and raised during the cold war... but this is the twenty-first century, and we're fighting an enemy we've never faced before: A world-wide death cult that wants to destroy the entire modern world and drag us all back to the seventh century.

We fight on behalf of modernity -- so we need modern, up to date, redesigned, and reenergized intelligence agencies to be our eyes and ears.

Finally, the enemy has an ideology of repression, human sacrifice, and slavery. It sounds horrible to us; but to Muslim subjects living under totalitarian tyrants, peasant tribesmen whose world is a nightmare, the promise that, if they'll slaughter the innocent in this world, they'll gain paradise in the next must sound like a bargain.

You can't fight something with nothing: We need to create an ideological counterinsurgency to fight the war of ideas with the Iran/al-Qaeda axis. We need to spread the ideology of freedom, hope, security, stability, and the rights of the individual across the hellholes of the Earth. We must give potential terrorist recruits alternatives to that dreadful path, if we're ever going to be safe ourselves.

4 - Vote for the ownership society

So-called "entitlements" are bleeding us dry. Out of the $3 trillion budget, Medicare, Medicaid, and Social Security alone account for nearly 50% of spending. This is completely unsustainable; either we find a long-term solution to out of control entitlement programs, or else we give up on America.

The problem is right in the name: "Entitlement" programs are services and money that we've told citizens they're "entitled" to extract from the government, no matter how fiscally catastrophic that is. The amount we pay each recipient increases by more than inflation every year, while the number of recipients grow as we all live longer, due to better medical care, and lead healthier lives. Add those together, and you have a prescription for disaster.

Like the intelligence agencies, entitlement programs were created during a very different era, when people didn't live much past 65. Senior citizens, the disabled, and the poor had very real problems that were going unaddressed; and these three programs and similar ones were created by Democratic Presidents Franklin Roosevelt and Lyndon Johnson out of compassion. But their compassion turned out to be based on extremely bad economics.

We don't live there anymore... so we need a new paradigm to solve the old problems. The solution is to shift retirement planning and health care for the elderly, disabled, and poor from a "hand-out" mentality to an "ownership" mentality: Turn benefits into investments, and let the very people who need them control them.

This saves money two ways: First, when you're living on other people's money, it's easy to slip into the trap of "the sky's the limit;" but when you own your own programs, you have an incentive to avoid waste, fraud, and abuse. Second, owning your own retirement program is more economical in the long run for exactly the same reason that owning your own home is more economical than renting all your life: It's an asset that appreciates.

It would save big money for the country, too. The government invests today's Social Security so badly, it barely earns interest at all; that's because the feds want to be able to loot the money at a moment's notice, so it can't be tied up in anything high-yielding.

The government must pay for every dime of retirement out of current receipts. But in an ownership society, Social Security is like a government-guaranteed 401K that earns most or even all of its own expenditures by interest paid.

So your kids (and grandkids) won't be breaking their backs supporting you; with the same SSI tax you pay now, you'll have an account that could well earn more money per year than you take out of it. Thus, no matter how long you and your spouse live, you won't run out of money... and you can even leave it to your kids as a nest egg.

5 - Vote for Capitalism, not crony liberalism and corruption

Earmarks are the corruption of ruling elite; they're personal budget items stuffed into legislation in the dead of night, often without any other senator or representative even seeing them. They pour money into the pockets of special interests, to the tune of hundreds of thousands, millions, and sometimes even tens of millions of dollars.

The recipient then kicks back some of that money to the reelection campaign of the member who pushed through the earmark. Earmarks as close as you can get to out and out bribery without being arrested.

The Republican Party has tried time and again to get the rest of Congress to eliminate earmarks altogether, but the Democrats won't do it. John McCain has refused to insert earmarks into legislation for many years now -- and his constituents know that and respect him for his principled stand.

But America simply cannot wallow in quasi-legal corruption. It brings our entire government into disrepute. Neither Republicans nor Democrats can resist the temptation to funnel millions of taxpayer dollars for a twine museum or cookbook library in their home districts... or even giving public money to local churches, including the Rev. Michael Pfleger's church in Chicago.

Earmarks to a politician are like whiskey to an alcoholic: He can't have "just one drink." The only solution is that we must do away with earmarks, root and branch. Every expenditure in a piece of legislation must go through the regular process, with all senators and representatives getting a chance to vote up or down.

When no member of Congress has the power to sneak your tax money to his own favorite business (the one that supports his reelection most heavily); when you can look on the internet and find where every dollar of your tax money went; then the citizens can regain control of their government once more.

E pluribus unum

Democrats have controlled Congress for the past two years, and they had significant veto power even before the 2006 elections. The president is not a dictator; he can only sign the bills he's sent... he can't simply make up legislation and put it into effect by decree. There is no reason to assume from the outset that everybody in America thinks every bad thing that happens is all Bush's fault -- or that every Republican running is a Bush "mini-me." Voters are not stupid; they're you and me and that feller behind the tree.

Politically, an economic downturn is going to hurt whichever party is perceived as not having a clue how to grow the economy again. The only plan the Democrats have for growing the economy is to tax us all to death.

It shouldn't be too hard to show voters that we Republicans have a better plan than "taxicide." But we have to be unified. I want to see the party develop some sort of "Vote for an American Future" contract with voters: This is what we stand for; this is where we're miles ahead of the Democrats; this is what we will do if elected. Then each GOP candidate should flesh out what exactly these points mean in terms that resonate with his own constituents.

If we do that, we'll very quickly "rebrand" the Republican Party... and we might lose hardly any seats at all.

Heck, we could conceivably even gain seats; it wouldn't take much to flip either the House or Senate back to GOP control. But if Republicans stubbornly refuse to unite; if they don't support the Republican nominee for president; if they try to run as "diet liberals," then we're going to get kicked in the stomach by Jubilation T. Jackass.

Hatched by Dafydd on this day, June 6, 2008, at the time of 6:39 PM | Comments (10) | TrackBack

April 4, 2008

Squeaker Warns Petraeus He Had Better Admit Iraq War Is Lost

Congressional Corruption
Hatched by Dafydd

In a frankly stunning display of the audacity of hopelessness, Speaker of the House Nancy Pelosi (D-Haight-Ashbury, 95%) "warned" Gen. David Petraeus and Amb. Ryan Crocker, according to the Voice of America yesterday, that in their upcoming congressional testimony, they had better not say that Iraq is doing well:

A few days before General Petraeus and Ambassador Crocker appear before House and Senate committees to deliver their latest update on Iraq, House Speaker Nancy Pelosi makes clear what she hopes they will not say.

In a news conference together with the chairmen of the House committees on Armed Services and Foreign Affairs, she refers to the recent fighting in Iraq's southern port city of Basra, saying Petraeus and Crocker should not attempt to put a positive spin on events.

"We have to know the real ground truths of what is happening there, not put a shine on events because of a resolution [of the situation in Basra] that looks less violent when it has in fact been dictated by someone [Iraqi Shiite cleric Moqtada] al-Sadr who can grant or withhold that call for violence or not," said Nancy Pelosi.

Yesterday, the New York Times revealed that one of the major "anonymous" sources claiming that Iraq Prime Minister Nouri al-Maliki had lost the Battle of Basra -- and that Muqtada Sadr and the Mahdi Militia had won -- was none other than Ambassador Crocker himself:

But the Iraqi operation was not what the United States expected. Instead of methodically building up their combat power and gradually stepping up operations against renegade militias, Mr. Maliki’s forces lunged into the city, attacking before all of the Iraqi reinforcements had even arrived. By the following Tuesday, a major fight was on.

“The sense we had was that this would be a long-term effort: increased pressure gradually squeezing the Special Groups,” Mr. Crocker said in an interview, using the American term for Iranian-backed militias. “That is not what kind of emerged.”

“Nothing was in place from our side,” he added. “It all had to be put together....”

“He went in with a stick and he poked a hornet’s nest, and the resistance he got was a little bit more than he bargained for,” said one official in the multinational force in Baghdad who requested anonymity. “They went in with 70 percent of a plan. Sometimes that’s enough. This time it wasn’t.” [Anonymous "sources" still outnumber named sources seven to one in this article, even with the "outing" of Amb. Crocker... a ratio that is astonishing all by itself.]

As the Iraqi military and civilian casualties grew and the Iraqi planning appeared to be little more than an improvisation, the United States mounted an intensive military and political effort to try to turn around the situation, according to accounts by Mr. Crocker [which are not quoted but only characterized by the Times] and several American military officials in Baghdad and Washington who spoke on condition of anonymity. [Naturally.]

Crocker may very well have been taken out of context; a thorough reading of the Times story paints a fact picture significantly at odds with the conclusionary nature of the article itself. For example, it's not until the very end of the article that we learn how much in control Iraqi forces were during the battle:

The United States helped the Iraqis ferry in supplies by C-130. The Iraqis, however, also began to fly in supplies and troops using their two C-130s. More than 500 Iraqi replacement soldiers were moved by air while an additional brigade was sent by ground. The Iraqis also flew Huey and Hip multimission helicopters.

Taking a page out of the American counterinsurgency doctrine, the United States encouraged the Iraqis to distribute aid and mount job programs to try to win over the Basra population.

To ease the distribution of supplies, American officials from the Agency for International Development flew with Iraqi officials to Basra to work with United Nations officials. The Americans also encouraged Mr. Maliki to proceed with his plan to seek an alliance with the Shiite tribes, as the Americans had done with Sunni tribes in the so-called Anbar Awakening.

“We strongly encouraged him to use his most substantial weapon, which is money, to announce major jobs programs, Basra cleanup, whatnot,” Mr. Crocker said. “And to do what he decided to do on his own: pay tribal figures to effectively finance an awakening for Basra.”

All of the most explosive charges -- for example, that Maliki was really trying to "weaken the Mahdi Army and the affiliated political party of the renegade cleric Moktada al-Sadr before provincial elections in the south that are expected to be to be held this year" -- still remain in the mouths of unnamed and even unquoted sources; in this case, "one American intelligence officer in Washington."

But this overtly condemnatory but covertly explupatory article has now become the basis for Pelosi and Reps. Howard Berman (D-CA, 85%) and Ike Skelton (D-MO, 85%) to demand that Petraeus and Crocker tell Congress that Basra is lost, and thereby that the "surge" is a failure. .. once again pointing out how the elite media has made itself into simply the propaganda arm of the Democratic Party. From the VOA article:

Thursday's news conference came in the wake of seemingly critical comments by Ambassador Crocker in a New York Times interview about the Iraqi government's handling of military operations in Basra.

Elaborating during a Baghdad news conference, Crocker indicated again that Iraqi military decisions caught U.S. forces by surprise. But he described Prime Minister Nouri al-Maliki as having acted decisively, and praised the Iraqi military for its ability to plan, execute and adjust its operation....

Democratic House foreign affairs chairman Howard Berman says the Iraqi government appears, in his words, to have largely frittered away chances for political reconciliation:

"The purpose of the [U.S. military] surge was to create political space for Iraqis to make meaningful strides toward national reconciliation, but sectarianism sadly remains the dominant force in Iraq and the sacrifices involved in getting us to this point don't seem to have put us much closer to the goal," said Howard Berman.

Left unexplained by Rep. Berman is how the Iraqi government -- controlled by the Shia -- attacking the Shiite militias under Iranian control is an example of "sectarianism."

Berman also announced -- again without explanation -- that the Iraq war had created "the inarguable strengthening of Iran, the most dangerous state in the Middle East." As the point was "inarguable," the VOA did not report any demur from Republicans. I would love to see a transcript of the committee meeting, however, to see whether the inarguable was, in fact, argued with.

Democrats, still giddy from their 2006 electoral victories, have persistently tried to dictate political analyses to the generals running the Iraq war, frequently chastising them for reporting facts that are inconvenient to Democratic defeatism. This breathtaking attempt to hijack the president's position as Commander in Chief hit its liberal apotheosis today; I doubt that ever before in the history of the Republic (perhaps of the West) has a government ordered its own military to falsely claim defeat in the face of clear victory.

In that sense, the 110th Congress of the United States is indeed historic.

Hatched by Dafydd on this day, April 4, 2008, at the time of 2:45 PM | Comments (5) | TrackBack

March 10, 2008

The Power of the Big Idea: O'Billery Reduced to "Me Too!"

Congressional Calamities , Congressional Corruption , Presidential Campaign Camp and Porkinstance
Hatched by Dafydd

Previous posts in our series about Congress, the Democrats, the Republicans, and earmarks:

  1. The Missing Earpiece
  2. Has Nancy Pelosi Changed Her Mind About Ears?
  3. The Democrats Are All Ears
  4. Earmarks? No No... Phonemarks!
  5. They're All Ears... Again

If Barack Obama represents the New Left and "youth" vote, while Hillary Clinton represents the Paleo-Left and gender-feminist vote, how can John McCain possibly compete? Simple, though not easy: He must lock up the "big idea" vote.

Between now and the election, I want to see two big ideas per month come bubbling up out of the McCain campaign -- both foreign policy and domestic. Let the Democrats hog the headlines with an increasingly nasty and personal slugfest; McCain will slide into public consciousness with a high-minded campaign of real ideas to solve real, everyday problems bedeviling ordinary people... such as congressional corruption.

And McCain's off to a grand start. Today, both Obama and Hillary were forced to chime in with a hearty "what he said" on the issue of congressional earmarks, those nasty bits of business where members of Congress steer federal money to specific home-district companies -- usually after said companies donate mucho dinero to the senator or congressman. (No, that certainly doesn't create any suspicion of bribery!)

Democrats Barack Obama and Hillary Rodham Clinton on Monday joined Republican presidential candidate John McCain and a small band of GOP senators in making a run this week against the billions of dollars in home-state pet projects Congress funds each year.

Obama, locked in a head-to-head battle with Clinton for the Democratic nomination, was the first to declare through a spokesman Monday that he would support a one-year moratorium on so-called earmarks when it comes up for a vote later this week. Clinton followed shortly afterward through a spokesman....

South Carolina Republican Jim DeMint, a first-term McCain ally in the fight against pork, is the main sponsor of a one-year ban on earmarks, the term lawmakers use for the pet projects they slip into must-pass legislation.

A vote is coming this week as the Senate debates its annual budget plan. McCain is expected to give a floor speech to rally Republicans behind the idea and to make time in his busy campaign schedule to cast a rare vote.

But the power of the big idea goes even further, for McCain not only supports the one-year moratorium -- which many legislators might climb aboard, assuming that after the year is up, it will be business as usual again; John McCain is also campaigning on a stern and readily testable anti-pork policy: He vows as president not to sign any bill that contains earmarks.

This goes far beyond what either Obama or Hillary would ever agree to do... which puts them into the self-defeating position of agreeing with McCain that earmarks are a corrupt scourge -- but being unwilling actually to eliminate them entirely. Why? As Jimmy used to say on the Mickey Mouse Club, "because we like you!" Viz.:

McCain is among only six members of the Senate who don't ask for pet projects. Obama does, though his requests are generally modest when compared to more senior senators like Illinois colleague Dick Durbin, a fellow Democrat.

As for Hillary, the magazine The Hill provides a clue:

Presidential hopeful Sen. Hillary Rodham Clinton (D-N.Y.) has secured more earmarks in the fiscal 2008 defense authorization bill than any other Democrat except for panel Chairman Sen. Carl Levin (D-Mich.)....

Clinton received 26 earmarks worth about $148.4 million total, most of which were also sought by Sen. Charles Schumer (D-N.Y.). Clinton and Schumer agreed several years ago to go after projects together, according to several sources....

According to the watchdog group Taxpayers for Common Sense, Clinton has secured 360 earmarks worth a combined $2.2 billion from 2002 to 2006 in all spending and authorization bills.

Back to the Assocated Press article:

Old-school senior Republicans such as former Appropriations Committee Chairman Thad Cochran of Mississippi have long teamed with Democrats to block moves by McCain to cut earmarks, typically by margins of 2-to-1 or so....

"[The moratorium] sounds like a bad idea to me," said Cochran. "I don't think that's very wise, to give up a constitutional responsibility that is given to Congress."

Congress has a constitutional responsibility to appropriate money for necessary spending... but it most certainly does not have a mandate to funnel billions of dollars to favorite-son companies as a form of corporate welfare, gleefully picking the winners and losers of what should be a market-based process; while Democrats whine about "no-bid contracts" going to Halliburton (Halliburton! Don't you understand? It's -- it's Halliburton!), they're beavering away at directing megabucks to specific companies -- no other bids accepted -- that just happen to have plants or headquarters located in the legislator's home district... and just happen to send some of that same money right back to the member as campaign cash.

Ah, but at least Obama and Hillary are willing to go as far as a one-year moratorium; so they have innoculated themselves against charges of being willing accomplices to corruption and the selling of the Congress -- right? Well, not quite; they may have a bit of an ulterior motive:

Pelosi also has many stalwart defenders of earmarks in her party, particularly among freshmen who this year received a disproportionate share of them to tout to voters in what, for many will be tough re-election campaigns.

But she's helped by the fact that no one expects many spending bills to pass before Election Day anyway, so accepting a temporary ban isn't much of a sacrifice.

When penance is barely felt, grace barely shines. They can pretend to support an end to ears without actually inconveniencing themselves one bit. And I expect John McCain to be positively scathing in his remarks about Democratic candidates who do not join him in the larger pledge, not to sign any bill that contains earmarks.

The GOP's failure in the 109th Congress to rein in excess spending, and especially the corruption of earmarks, was probably the single greatest cause of their loss in the 2006 elections. There is no indication that voters will give Democrats a pass on the same issue; if they did, I suspect Congress' approval rating would be significantly higher than 25%.

It's high time we had a candidate who would stick the eventual Democrat nominee between the Devil and Charybdis, leaving him in a quandry where he has to cut off his ears to fight his race.

Hatched by Dafydd on this day, March 10, 2008, at the time of 7:39 PM | Comments (5) | TrackBack

November 24, 2007

More On the Clintonian Culture of Corruption

Congressional Corruption , Elections , Media Madness
Hatched by Dafydd

An innocuous AP story -- "InfoUSA discloses SEC investigation of company spending" -- hides deep within its bowels another serious indictment of corruption and incuriosity by Bill and Hillary Clinton about the likely criminal source of their donors' money. It's hard to believe the Clintons don't know about it -- assuming they read their own "home state" newspaper.

And even the New York Times itself goes to some effort to hide the real story from our eyes. Evidently, they're worried we might not have enough of a nuanced, sophisticated view to understand that there's really nothing to see here. But before blasting back to the dim mists of this spring, let's return to the Associated Press:

The Securities and Exchange Commission has opened an investigation into spending by database marketer InfoUSA Inc.

The Omaha-based company said in a filing Tuesday that it would cooperate with the SEC's request for documents related to expense reimbursement, transactions with related parties, some corporate expenditures and certain trades of company stock.

The company did not specify what spending the SEC is looking for, but a lawsuit two hedge funds filed earlier this year may offer some clues.

Ho-hum; MEGO; who cares... another company being investigated by the SEC, right? I never would have noticed this article had it not been reposted by Newsmax; and I never would have read it had they not given it a more revealing title: "SEC Investigates Co. with Clinton Links."

(As always with Newsmax, I distrust their objectivity; so when they post a story on their site, I always hunt for a more authoritative source. Since this International Herald Tribune version is word-for-word identical to what Newsmax reposted, I believe this is what AP actually moved on the wire.)

Reading further into the article, we see that AP unquestionably buried the lede; recall, the SEC is investigating InfoUSA because of allegations that surfaced in a lawsuit filed by a couple of hedge funds:

The lawsuit also questions why [InfoUSA founder Vin] Gupta used private jets to fly Bill and Hillary Clinton on business, personal and campaign trips, and why Gupta gave Bill Clinton a $3.3 million (€2.2 million) consulting contract.

According to the lawsuit, InfoUSA has spent nearly $900,000 (€607,533) since 2001 flying the Clintons to domestic and international locations and political events.

Has this previously been disclosed by the Clinton campaign? On its face, it would seem to violate campaign finance rules banning corporate (and union) political "in-kind" contributions to members of Congress. And that three-million dollar "consulting" contract to Bill Clinton could easily be seen as an end-run around the ban on direct corporate contributions to federal campaigns -- hey, it's not for Hillary, it's for Bill!

The Clintons insist that they did disclose and "reimburse" InfoUSA, and its Clintonista founder Vinton "Vin" Gupta, for some of its contributions, according to the New York Times version of the AP story; though so far, this is based entirely on the Clintons' word:

Mr. Gupta has been a major donor to Democrats and gave at least $1 million to Mr. Clinton’s presidential library in Arkansas. Mr. Gupta also took part in a June fund-raiser for Mrs. Clinton in Manhattan.

A spokesman for Mrs. Clinton said in May that all the flights connected to InfoUSA were reimbursed and disclosed in accordance with Federal Election Commission and Senate ethics rules.

Note that Hillary Clinton's campaign only claims that they reimbursed the air transportation; they say nothing about reimbursing or returning the multi-million dollar contract... to Bill Clinton. But Gupta has a long history of financial support of the Clintons, both as fundraiser and individual contributor, which bought him a night in the Lincoln bedroom and not one, not two, but three offers of appointment by President Clinton, only the last of which -- to the board of directors of the "prestigious" John F Kennedy Center for the Performing Arts -- did Gupta accept.

But the truly damning part of the AP story linked at the top is what else InfoUSA has been doing. Take a gander:

The company has come under scrutiny for its policies concerning the sale of personal information.

The New York Times reported in May that InfoUSA, which compiles consumer information and sells it to direct marketing companies and others, sold the names of senior citizens, including millions with Alzheimer's disease and others whom it identified as gamblers, with labels that said things such as, "These people are gullible."

The company has denied those allegations and said it does everything it can to ensure it does not do business with scam artists.

Curiously, this nugget did not find its way into the Times' version of the AP story. But perhaps they weren't aware of it?

That defense is a tad unlikely, when one reads this other NYT article, published way, way back -- in May of this year. The Times published what must be the definitive, multi-page article on the despicable, criminal behavior of InfoUSA (one of a series on corrupt corporations)... and gives us a much clearer view of the sort of folks who become top donors to Hillary Clinton's presidential and senatorial campaigns, and of course to Bill's campaigns and his presidential library (though the earlier NYT article leaves that part of the story unmentioned):

Bilking the Elderly, With a Corporate Assist

The thieves operated from small offices in Toronto and hangar-size rooms in India. Every night, working from lists of names and phone numbers, they called World War II veterans, retired schoolteachers and thousands of other elderly Americans and posed as government and insurance workers updating their files.

Then, the criminals emptied their victims’ bank accounts.

A 92 year old veteran of the Army during World War II, Richard Guthrie lost his entire life savings to thieves from India. And where do you suppose they got Guthrie's name and the idea that he would be a prime target for their scams? I'm sure you never saw this one coming...

Mr. Guthrie, who lives in Iowa, had entered a few sweepstakes that caused his name to appear in a database advertised by infoUSA, one of the largest compilers of consumer information. InfoUSA sold his name, and data on scores of other elderly Americans, to known lawbreakers, regulators say.

InfoUSA advertised lists of “Elderly Opportunity Seekers,” 3.3 million older people “looking for ways to make money,” and “Suffering Seniors,” 4.7 million people with cancer or Alzheimer’s disease. “Oldies but Goodies” contained 500,000 gamblers over 55 years old, for 8.5 cents apiece. One list said: “These people are gullible. They want to believe that their luck can change.”

Would the Clinton campaign consider "reimbursing" Mr. Guthrie, and all of his fellow "gullible" elderly, sick veterans and other victims?

The thieves would call and pose as government workers or pharmacy employees. They would contend that the Social Security Administration’s computers had crashed, or prescription records were incomplete. Payments and pills would be delayed, they warned, unless the older Americans provided their banking information.

Many people hung up. But Mr. Guthrie and hundreds of others gave the callers whatever they asked.

“I was afraid if I didn’t give her my bank information, I wouldn’t have money for my heart medicine,” Mr. Guthrie said.

Most of these listsellers, certainly including Mr. Gupta's InfoUSA, are well aware that they're selling to thieves and con artists; but they continue to do so, even after law-enforcement authorities warn them -- repeatedly -- who their "clients" really are. It's crystal clear to enforcement agencies that companies like InfoUSA know exactly what they're doing, and also know that the odds of them being convicted in court are quite low.

Perhaps especially if they have influential politicians in their back pockets.

Although some companies, including Wachovia, have made refunds to victims who have complained, neither that bank nor infoUSA stopped working with criminals even after executives were warned that they were aiding continuing crimes, according to government investigators. Instead, those companies collected millions of dollars in fees from scam artists. (Neither company has been formally accused of wrongdoing by the authorities.)

“Only one kind of customer wants to buy lists of seniors interested in lotteries and sweepstakes: criminals,” said Sgt. Yves Leblanc of the Royal Canadian Mounted Police. “If someone advertises a list by saying it contains gullible or elderly people, it’s like putting out a sign saying ‘Thieves welcome here.’ ”

Naturally, this being the world of the elite media, there is no mention of the Clinton connection in the Times article about the horrific scams committed by thieves working hand in glove with InfoUSA. They never even mention that InfoUSA is run by long-time Clintonista Vin Gupta, or the efforts Bill Clinton made to get him on the government payroll.

But even creepier, the Times' version of the Associated Press article on the SEC investigation of InfoUSA -- which discloses the fact that founder Gupta is one of the Clinton's most prolific and reliable donors and fundraisers -- completely omits the following paragraph from the AP story and other papers' versions (e.g., the IHT version linked above):

The New York Times reported in May that InfoUSA, which compiles consumer information and sells it to direct marketing companies and others, sold the names of senior citizens, including millions with Alzheimer's disease and others whom it identified as gamblers, with labels that said things such as, "These people are gullible."

So the New York Times printed two articles about InfoUSA:

  • The first discussed how InfoUSA criminally preyed upon "gullible" elderly victims, including veterans and Alzheimers patients -- but didn't mention the Clinton connection;
  • The second, published six months later (when the first article would have dropped into the memory hole), discloses the deep Clinton connection to InfoUSA through founder Vinton Gupta... but never mentions the earlier investigative report on InfoUSA's aiding and abetting of criminals who prey upon senior citizens.

One would think that a top Clinton donor making millions of dollars by knowingly selling victim-lists of "gullible" elderly and/or sick vets to heartless con artists, who then bilk the victims out of their life savings, would qualify as part of "all the news that's fit to print;" but evidently, when it comes to the Clintons, the motto mutates to "all the news we see fit to print."

If blogs came with soundtracks, I think I would insert the infamous clip of Hillary cackling madly, as heard on Hugh Hewitt's show and your local "internets."

But of course, this is just another eddy of the cylone of coincidence that forever swirls around the Clintons, which always fascinates but never illuminates: from astonishing luck in cattle futures to mysteriously vanishing Rose Law Firm billing records (which reappear, equally mysteriously, in the residence wing of the White House), to the amazing number of pardoned felons -- like multi-millionaire Marc Rich -- who just happened, by merest chance, to have donated huge sums to the Clinton Presidential Library.

Nothing to see here, folks; it's time to move on...

Hatched by Dafydd on this day, November 24, 2007, at the time of 4:39 PM | Comments (3) | TrackBack

October 4, 2007

He's Baaa-aack...

Congressional Corruption , Unuseful Idiots
Hatched by Dafydd

When news surfaced that Sen. Larry Craig (R-ID, 88%) had pled guilty to disorderly conduct -- in order to avoid prosecution for solicitation of sex in a men's room and for being a Peeping Tom -- he stated in no uncertain terms that he would resign on September 30th, 2007.

As that date approached, he belatedly decided to challenge his guilty plea, despite the low probability of success. Accordingly, he announced that he would not resign until he'd been heard and the issue was resolved. Well, it was resolved today: Hennepin County (Minnesota) Judge Charles Porter denied the request.

Mr. Craig's response?

Idaho Sen. Larry Craig defiantly vowed to serve out his term in office on Thursday despite losing a court attempt to rescind his guilty plea in a men's room sex sting.

"I have seen that it is possible for me to work here effectively," Craig said in a written statement certain to disappoint fellow Republicans who have long urged him to step down.

This is perhaps the most narcissistic decision by a senator I have ever seen. At least Mark Foley had the decency, grace, and sense of duty to resign from the House.

Craig evidently is so angry at his fellow Republicans not defending him (after he was nabbed trying to solicit sex in a men's room and peep into the adjacent stall), that he has decided to take the entire GOP down with him when he goes. This is so bitter, self-destructive, and vengeful, that I begin to suspect he is in the closet after all: I believe Larry Craig is a closet Democrat.

I hope that the Republicans, for their own sake and the sake of the nation, plan to take decisive action to remove the source of the problem. There is some indication they may be doing so:

In his statement, Craig said he will not run for a new term next year. [Uh-huh.]

But in the meantime, he said: "I will continue my effort to clear my name in the Senate Ethics Committee -- something that is not possible if I am not serving in the Senate."

The ethics committee has already signaled it is reviewing the facts of Craig's case, taking the step after the Senate Republican leadership requested it.

Craig's decision to stay and fight raises the strong possibility of public hearings - virtually certain to be televised live - centered on the issue of gay sex.

This needn't necessarily hurt the GOP in 2008 -- if they play it straight (sorry, couldn't resist). If they vigorously fight to expel him from the Senate, calling as witnesses the cop who arrested him and those who were involved in the interrogation, playing the audiotape of the interrogation, and so forth, then I don't think they will be Foleyed a year from November.

If the Republicans succeed in expelling Craig, then the Democrats will have a hard time arguing that the GOP is a seething hotbed (sorry) of sexual deviancy. And if the GOP fails because the Democrats vote en masse to keep Crait... well then the shoe is on the other hand, isn't it?

By the way, I love this sentence: "In his statement, Craig said he will not run for a new term next year."

Of course, he also said he would resign on September 30th; and he also strongly and deliberately implied that, if he lost his bid to withdraw his guilty plea, he would resign then. That constitutes two public lies to the American people in less than one month -- another reason to believe he is a closet Democrat!

I guess he believes "third time's the charm..."

Hatched by Dafydd on this day, October 4, 2007, at the time of 2:23 PM | Comments (2) | TrackBack

August 8, 2007

Kosher Security: the War Against Global Pork

Congressional Corruption , Econ. 101 , Presidential Campaign Camp and Porkinstance , War Against Radical Islamism
Hatched by Dafydd

This is the second in our ongoing series, searching for a unifying theme of national security in the campaigns of Republican candidates for president. I believe that we desperately need such a theme: an easy-to-understand, overarching "narrative" that melds together a number of urgent problems and their solutions. Our first post in this series explained why the future of energy production is actually a national-security issue:

In this installment, I hope we can demonstrate that eliminating "pork" (earmarks, phonemarks) from the government's diet is also a vital national-security issue.

First, let's start with a definition: Not every earmark is "pork." In the Congress, an earmark means a section of appropriations legislation that directs funding to a specific, named purpose. If the purpose truly benefits the entire country -- for example, earmarking funds to upgrade and improve the Air Traffic Control computer system -- there is nothing untoward about it. It could still be either a good or bad expenditure, but it's not necessarily corrupt, even if it specifies the company that will perform the upgrade.

The problem arises when the earmark is directed to a project benefitting only the district or state of the powerful congressman who forced its inclusion... and especially when it benefits a particular business within that district (or even elsewhere) that just happens to have contributed significant money to that congressman's reelection fund. Let's agree to call earmarks intended to benfit only a narrow subset of Americans, at the expense of the rest of us, "evil-earmarks," or EEs, to distinguish them from the other kind.

EEs can be a profitable deal for the company: They bundle $200 thousand from "voluntary" employee contributions to Congressman Smitty, and Congressman Smitty directs $223 million worth of new business to the company, building a Mucus Museum or a new dome for the George Soreass Sports Centre. If it just so happens that the 200 Gs came from a hundred executives, each of whom owns significant stock in the company, and if the company stock rises a few points because of the earmark, it can even be profitable (and legal) for the donating employees.

Of course, it's not so good for the rest of us, who have to pay higher taxes to support somebody else's wretched soccer stadium. $223 million may be a mere molecule in the opalescent ocean of federal spending; but a couple thousand of such earmarks would be greater than this year's entire budget for the Department of Defense. A billion dollars here, a billion dollars there... it adds up.

And as it adds up, such corruption saps the economic strength of the United States.

Econ. 101

Most economists -- and by definition all free-market economists, who are the only ones I care about (color me prejudiced) -- agree that wealth is generally much better spent or invested by its creators, or those who legitimately purchase it, than by the government. Financial decisions of governmental bodies or functionaries are often not made on the basis of a proper cost-benefit analysis but for purely political reasons.

For example, consider the move by politicians (and left-liberal academics at state-funded universities) in the 1970s and 80s to divest pension-fund portfolios of all stock in South African companies, to protest Apartheid... and the similar move among many state and local governments -- and left-liberal academics at state-funded universities -- to divest pension funds of all stock in Israeli companies, and even non-Israeli companies that do business in Israel, to protest Israel's continued existence. Or consider the move to divest from Wal-Mart because Wal-Mart's employees continue to vote against unionizing.

When people invest their own money, they tend to take more care; and they tend to put economic considerations above sending a partisan message. But when they invest "OPM," they're much less circumspect. Democrats especially are always willing to purchase sanctimony by digging down deep -- into your pocket.

It is a truism requiring no argument that investing for non-economic reasons will not, in general, generate as great a return as investing based upon purely economic reasons. Bad investments of great magnitude damage the economy. Thus, evil-earmarks damage the economy.

Why does this matter? For the obvious reason that the operating budget of the United States -- and all components, including the DoD, the CIA, DHS, NSA, FBI, and the State Department -- critically depends upon the health of the nation's economy: Anything that damages the economy, including evil-earmarks, harms national security.

The road to apathy

But there is a more subtle way that EEs become a national-security issue: They are the most visible examples of corruption in government; and when the government is seen as corrupt, it's harder to inspire support for vital national-security programs, from the NSA's Terrorist Surveillance Program and the data-mining program, to support for the Iraq and Afghanistan wars, to military recruitment.

The more people believe the government is corrupt, the less likely they are to believe anything government officials say... hence the less likely they are to support intelligence gathering programs and major sacrifices, such as war. In an indirect but nevertheless very real sense, past GOP corruption led Americans to discount defenses of the war and other security measures. Many Americans believed "they'll say anything to keep the spigot wide open."

Now the Democrats are in charge, to a large extent because of the perception of a "Republican culture of corruption;" and voters have discovered that lobbyists are equal-opportunity seducers: They're just as happy bribing Democrats as Republicans, and the former are equally willing to grab for the cash. Thus, despite many promises to the contrary, in the end, the Democrats could not bring themselves to shine a spotlight on individual earmarks; since they took over the corrupt practice of evil-earmarks themselves, they have lost all interest in making EEs public record.

In fact, they even invented a brand new method of achieving the same goal, which has been dubbed "phonemarking." See the link above.

Visible corruption leads to the erroneous belief that it "doesn't matter" who is in charge, because "they're all equally corrupt." This in turn leads to voter apathy... or even worse, electoral tribalism, where elections are treated as playoff games; voters cheer when "their guy" wins, regardless of his issue positions, experience, or even fitness for the job.

An apathetic or tribalist electorate has a very hard time understanding bipartisan issues such as war, national security, protecting the borders, the rule of law, and leadership. They care only where their "team" stands in the rankings.


A presidential candidate can sum up this entire syllogism very pithily:

Continued congressional corruption not only bleeds away funds we need to support vital national security; worse, it saps the willingness of the American people to stand up for our country and our culture.

I have never seen a valid counterargument: Stopping evil-earmarks is a vital national-security issue, and it should be defended as such by all the Republican candidates for president... and indeed, the Democrats as well; though so far, the latter -- notably including the Democratic presidential candidates -- seem as incapable of understanding this point as the Republicans who ran the 109th Congress last term.

Hatched by Dafydd on this day, August 8, 2007, at the time of 3:22 PM | Comments (2) | TrackBack

August 1, 2007

They're All Ears... Again

Congressional Corruption
Hatched by Dafydd

With great fanfare, the House nearly unanimously passed the Democrats' "ethics" bill... and just as Big Lizards predicted, there is virtually nothing in it to forbid or even slow down the enacting of congressional "earmarks":

The bill, which was drafted by Democratic leaders, has been a signature issue for Democrats since winning control of Congress last November. The measure would end gifts to lawmakers, including meals and tickets, by lobbyists and their clients. The bill is also intended to force members of both houses to make public the names of lobbyists who raise $15,000 or more for them in any six-month period with practice known as "bundling," the combination donations from many people.

House members approved the new legislation 411 to 8, even though some privately grumbled that it would make fund-raising more difficult.

Previous posts in our series about Congress, the Democrats, and earmarks:

  1. The Missing Earpiece
  2. Has Nancy Pelosi Changed Her Mind About Ears?
  3. The Democrats Are All Ears
  4. Earmarks? No No... Phonemarks!

In The Democrats Are All Ears, published more than eight months ago, here is what we said:

In today's New York Times, we've started to find out the contours of just what the Democrats meant when they said they would clean up the "Republican culture of corruption." Interestingly, it doesn't appear to include earmarks -- which are the biggest problem:

Their initial proposals, laid out earlier this year, would prohibit members from accepting meals, gifts or travel from lobbyists, require lobbyists to disclose all contacts with lawmakers and bar former lawmakers-turned-lobbyists from entering the floor of the chambers or Congressional gymnasiums. [That's harsh... congressmen turned lobbyists will no longer be able to use the Stair Stepper or the House basketball court. That's got to hurt.]

None of the measures would overhaul campaign financing or create an independent ethics watchdog to enforce the rules. Nor would they significantly restrict earmarks, the pet projects lawmakers can anonymously in sert into spending bills, which have figured in several recent corruption scandals and attracted criticism from members in both parties. The proposals would require disclosure of the sponsors of some earmarks, but not all.

I have the strangest sense of déjà vu; where did I hear this before? Oh yes, here we go... in both of the two previous Big Lizards posts linked above, I noted that "Democrats in the House voted 147 to 45 against the Republican rules change that identified all earmarks and their congressional sponsors." That's more than 3-1 against identifying the sponsors of earmarks.

Two-thirds of a year hath passed, but the Democrats are no more interested in curtailing earmarks than they ever were; the closest the new legislation -- now passed by the full House -- comes to the subject is to require that earmarks be disclosed by the congressional sponsors 48 hours before the House or Senate votes.

But there is not a word in here about the primary opportunity to insert earmarks, the point at which most of them get added: They usually appear in the joint conference, where congressmen reconcile differences between the House and Senate versions of the same bill.

At that time, in what is in essence a big committee (with members of both bodies present), I don't believe there is any official record kept of who added what, or even what is in there. Nor can there be any amendments after the joint conference, nothing either added or deleted; the only options are to pass the legislation as is or not to pass it at all.

Since the Times does not explicitly say that the current legislation would allow any exceptions to that rule, allowing earmarks inserted during the joint conference to be removed -- or even mentioned on the floor of either chamber -- then I must assume that it does not, in fact, prevent that particular form of corrupt skullduggery.

Sidebar: Evidently, the word "skullduggery" appears to come from the Scottish dialect "sculduddery," meaning obscenity or fornication. Stick that in your Congressional Record and smoke it.

So the mountain, having labored longly and loudly, with a hundred declamations of self-righteous sanctimony, has in the end given birth to a mouse of an ethics bill. As Shakespeare said, it's "sound and fury signifying nothing." The bill is utterly useless, serving only to make earmarks even more obscure and difficult to eradicate than before.

And let us not forget that one of the first acts of the incoming Democratic majority in the House was to find a brand, new way of slipping earmarks into pending spending -- this time by turning them into "phonemarks." In Earmarks? No No... Phonemarks!, we caught them in the act:

The Democrats have not only jettisoned any idea of "cleaning up" Washington and running the most ethical Congress in history... they have become positively ingenious in finding new ways to hide their culture of corruption from public view:

When the new Democratic majority in the House of Representatives passed one of its first spending bills, funding the Energy Department for the rest of 2007, it proudly boasted that the legislation contained no money earmarked for lawmakers' pet projects and stressed that any prior congressional requests for such spending "shall have no legal effect."

Within days, however, lawmakers including Senate Majority Leader Harry M. Reid (D-Nev.) began directly contacting the Energy Department. They sought to secure money for their favorite causes outside of the congressional appropriations process -- a practice that lobbyists and appropriations insiders call "phonemarking...."

That is, individual members of Congress would call appropriators at the Department of Energy and say, in their best Vito Corleone voice, "We know there's nothing in the bill requiring it, but we think it would be better for everyone, not to mention safer, if you hired this particular New Jersey contractor to develop a new nuclear reactor, rather than any of the other competitors."

And of course, it was House Appropriations Committee Chairman David R. Obey (D-WI, 90%) who came up with the brilliant idea of banning earmarks from spending legislation... but then re-inserting them into the bill when it goes to the join conference.

So now they've gone and done exactly what they said they would: Remove all their own earmarks even from the flickering light of yesterday's Congress and sneak them in under the total blackness of the secret joint conference... or even ex post facto by making extortionary calls to federal agencies, warning that it might not be healthy to forget to funnel a few billion dollars off to favored Democratic contractors.

Thank goodness we got rid of that Republican culture of corruption!

And will the elite media now leap to their collective feat in a standing ovulation, cheering this magnificent feat? We're all ears.

Hatched by Dafydd on this day, August 1, 2007, at the time of 3:30 AM | Comments (1) | TrackBack

June 25, 2007

Free Speech for Me AND for Thee

Congressional Corruption , Court Decisions , Presidential Campaign Camp and Porkinstance
Hatched by Dafydd

The realignment continues on the ship of state (that sounds weird somehow, but I'm too lazy to fix it). Today, the Supreme Court of the United States (SCOTUS -- which also sounds weird and vaguely salacious) cast out the most offensive provision of the McCain-Feingold Bipartisan Campaign Reform Act of 2002... the signing of which, and continued defense of, is the worst decision ever made by President Bush, a president I otherwise mostly admire.

The BCRA set contribution limits on individuals as well as corporations and -- in its most controversial section -- banned "issue ads" within 60 days of an election if they even so much as mentioned a candidate's name:

The case involved advertisements that Wisconsin Right to Life was prevented from broadcasting. The ads asked voters to contact the state's two senators, Democrats Russ Feingold and Herb Kohl, and urge them not to filibuster President Bush's judicial nominees.

Feingold, a co-author of the campaign finance law, was up for re-election in 2004.

The provision in question was aimed at preventing the airing of issue ads that cast candidates in positive or negative lights while stopping short of explicitly calling for their election or defeat. Sponsors of such ads have contended they are exempt from certain limits on contributions in federal elections.

The Court ruled today that preventing the airing of ads violated the First Amendment's freedom of speech provision:

The decision upheld an appeals court ruling that an anti-abortion group should have been allowed to air ads during the final two months before the 2004 elections. The law unreasonably limits speech and violates the group's First Amendment rights, the court said.

"Discussion of issues cannot be suppressed simply because the issues may also be pertinent in an election," Chief Justice John Roberts wrote for the majority. "Where the First Amendment is implicated, the tie goes to the speaker, not the censor."

Politically, the ruling is a horrendous body blow to the already faltering campaign of Sen. John McCain (R-AZ, 65%), one of the two eponymous senators who introduced the bill in the Senate (the other is Russell Feingold, D-WI, 100%), widely considered the most liberal fellow in the Senate. McCain seems to be enraged at the Court, perhaps seeing it as a personal insult to him that may require the Chief Justice to defend it with his body upon the field of honor:

The decision is a setback for Sen. John McCain, R-Ariz., who helped write the 2002 campaign finance legislation with Feingold that contained the advertising provision. McCain, now a presidential candidate, has come under criticism from conservatives for attempting to restrict political money and political advertising.

"It is regrettable that a split Supreme Court has carved out a narrow exception by which some corporate and labor expenditures can be used to target a federal candidate in the days and weeks before an election," McCain said in a statement. [That "narrow exception" appears to refer to the First Amendment to the United States Constitution, with which Sen. McCain takes issue.]

The court's decision, however, has no effect on the more far-reaching component of the campaign finance law - it's ban on the ability of political parties to raise unlimited and unrestricted amounts of money from unions, corporations and wealthy donors.

"Fortunately," McCain said, "that central reform still stands as the law."

Happily, Mitt Romney appears to have been the first Republican presidential candidate to applaud the demise of the odious "issue-ad" prohibition of McCain-Feingold.

I call this excellent ruling a realignment because the Court's reversal of a central provision of its December, 2003 ruling upholding the BCRA, McConnell v. Federal Election Commission, 540 U.S. 93 (2003), can be traced to one key event: President Bush nominated Samuel Alito to replace Justice Sandra Day O'Connor.

On the core findings in McConnell v. FEC, Justices O'Connor, Stephen Breyer, John Paul Stevens, Ruth Bader Ginsburg, and David Souter upheld all the most important elements of the law; the dissenters were Justices Antonin Scalia, Clarence Thomas, Anthony Kennedy, and Chief Justice William Rehnquist.

In today's ruling, every justice still on the Court voted the same as he or she did last time; Chief Justice John Roberts voted against the BCRA and in favor of freedom of speech, just as Rehnquist did. The only difference was that Justice Alito reversed Justice O'Connor's vote from pro-BCRA to anti.

I believe this signals a realignment of the Court, with a new 5-4 majority favoring more freedom for the individual at the expense of government control, except where the government can show a dire national emergency -- as with cases involving elements of the war against global jihadism -- or when the government stands "in loco parentis" of schoolchildren. And I think this ruling bodes very ill for those compulsive authoritarians, such as Sen. Diane Feinstein (D-CA, 90), who want to revive the "Fairness Doctrine": Surely the same five justices will agree that forcing a TV or radio show to broadcast political opinions contrary to those they hold, just to maintain a federally directed "balance of opinion," is also a violation of the fundamental (and constitutional) freedom of speech.

Asked if she would revive the fairness doctrine, which used to require broadcasters to present competing sides of controversial issues, Feinstein said she was "looking at it."

"I remember when there was a fairness doctrine," she said, "and I think there was much more serious correct reporting to people."

Yes. As "Uncle" Walter Cronkite's reporting of the Tet Offensive demonstrates.

In a shocking turn of events, the New York Times -- which, as a print newspaper, was exempt from the provisions of the BCRA on grounds of freedom of speech, and which thus was the major player in the news medium that held a monopoly on issue advertising during the last 60 days of an election -- bemoans the Court's decision today allowing broadcast media that same right:

By 5 to 4, the court ruled that an anti-abortion group in Wisconsin should have been allowed to broadcast ads before the 2004 race for the United States Senate in that state. In its ruling today, the high court opened a significant loophole in the Bipartisan Campaign Reform Act of 2002, familiarly known as the McCain-Feingold law, to curb donations to campaigns.

The "loophole" in question would appear to be that pesky First Amendment again... "free speech for me but not for thee." The Times continues, giving the gavel over to dissenting Justice David Souter:

In the case decided today, Federal Election Commission v. Wisconsin Right to Life, No. 06-969, Justice David H. Souter wrote a dissent that Justices John Paul Stevens Ruth Bader Ginsburg and Stephen G. Breyer joined.

“After today,” the dissenters said, “the ban on contributions by corporations and unions and the limitation on their corrosive spending when they enter the political arena are open to easy circumvention, and the possibilities for regulating corporate and union campaign money are unclear.”

The dissenters expressed dismay over today’s ruling and said it could portend a new wave of public cynicism about the role of big money in politics.When the case decided today was argued on April 25, Solicitor General Paul D. Clement, arguing on behald of the election commission, said that to find that the Wisconsin ads should have been allowed to run would leave the McCain-Feingold law “wide open.” Justice Breyer predicted then that a ruling like today’s could mean, in effect, “Goodbye, McCain-Feingold.”

Ooooh, if only! But two of the majority justices -- the two new guys -- decided to act like judicial conservatives who believe in judicial restraint, and they limited their decision to upholding the actual judgment of a three-judge panel of the D.C. Circus Court that heard the case. Rather than declare the entire provision unconstitutional, as Scalia, Kennedy, and Thomas did in a separate opinion, Roberts and Alito held only that the panel was right to rule that the "issue ads" of Wisconsin Right to Life, Inc. did not constitute "express advocacy," as banned by the BCRA.

(I think this is what lawyers call an "as applied" challenge, meaning that the court does not decide whether the law itself is unconstitutional but rather whether it was wrongly applied in the particular case.)

The refusal of Roberts and Alito to go as far as Scalia, Kennedy, and Thomas does not necessarily mean they disagree with the latter's position: Roberts' and Alito's understanding of judicial restraint may mean that they simply refuse to go beyond the particulars of the case to make sweeping judgments where none is required. In a clean challenge to that provision of the BCRA, they might very well vote to strike it down.

Sadly, the Bush administration doubled down in this case, filing an amicus curiae brief urging the Court to uphold the FEC's authority to ban the ads. Thus, the Bush psychodrama continues... although it's worth noting the administration's consistency: They support McCain-Feingold even against their own conservative Republican supporters... Bush is an equal-opportunity free-speech denier.

Nevertheless, I now expect to see a flurry of conservative, 5-4 decisions emanate from the penumbra of this Court, as the judicial realignment proceeds apace. Keep watching the skies!

Hatched by Dafydd on this day, June 25, 2007, at the time of 2:33 PM | Comments (19) | TrackBack

May 25, 2007

Earmarks? No No... Phonemarks!

Congressional Corruption
Hatched by Dafydd

In a stunning piece -- stunning that it appeared in the Washington Post, I mean, not stunning in what it reports -- John Solomon and Jeff Birnbaum ("the Mustache" from Brit Hume's Special Report roundtable) confirm what we've been seeing for some time now: The Democrats have not only jettisoned any idea of "cleaning up" Washington and running the most ethical Congress in history... they have become positively ingenious in finding new ways to hide their culture of corruption from public view:

When the new Democratic majority in the House of Representatives passed one of its first spending bills, funding the Energy Department for the rest of 2007, it proudly boasted that the legislation contained no money earmarked for lawmakers' pet projects and stressed that any prior congressional requests for such spending "shall have no legal effect."

Within days, however, lawmakers including Senate Majority Leader Harry M. Reid (D-Nev.) began directly contacting the Energy Department. They sought to secure money for their favorite causes outside of the congressional appropriations process -- a practice that lobbyists and appropriations insiders call "phonemarking."

(Hat tip to cybercolumnist Rich Galen of Mullings fame -- read and subscribe; he's a national treasure!)

That is, individual members of Congress would call appropriators at the Department of Energy and say, in their best Vito Corleone voice, "We know there's nothing in the bill requiring it, but we think it would be better for everyone, not to mention safer, if you hired this particular New Jersey contractor to develop a new nuclear reactor, rather than any of the other competitors."

Right after the election, incoming Squeaker of the House Nancy Pelosi (D-Haight-Ashbury, 95%) famous pledged, in a November 14th op-ed published in the Christian Science Monitor, to clean up what she was pleased to call "the Republican culture of corruption;" and in particular, she threatened to eliminate all earmarks. (Or was that earwigs? I get them confused.)

We pledge to make this the most honest, ethical, and open Congress in history.

But most non-readers of Big Lizards misunderstood her vow, not realizing that she actually meant to eliminate earmarks by changing them into "phonemarks" and driving them underground.

Readers of this blog were alerted to the many ways in which Democrats were trying to get around their promise to clean up congressional corruption -- now that they were in line to start receiving the lion's share of it. We published several posts on the subject:

Here is another example of the Democrats' peculiar talents: The chairman of the House Appropriations Committee wants to institutionalize the nasty bit of business whereby earmarks are banned in the original bills -- but inserted instead into the bill when it goes to the joint House-Senate conference committee:

Upon taking control of Congress after November's midterm elections, Democrats vowed to try to halve the number of earmarks, and to require lawmakers to disclose their requests and to certify that the money they are requesting will not benefit them.

But the new majority is already skirting its own reforms.

Perhaps the biggest retreat from that pledge came this week, when House Appropriations Committee Chairman David R. Obey (D-Wis.) told fellow lawmakers that he intends to keep requests for earmarks out of pending spending bills, at least for now. Obey said the committee will deal with them at the end of the appropriations process in the closed-door meetings between House and Senate negotiators known as conference committees.

Some of you may be getting bugeyed at all this "inside-outball," so here's a little explanation you will probably all remember from your Civics classes in public school, Capitol Conjugations 101. How a bill becomes a law:

  1. The bill is first introduced in one of the two chambers of Congress, the House or the Senate; let's say the former, in this instance.
  2. The House bill is debated, amended, and fails miserably.
  3. After a hundred iterations of 1 and 2, a completely different version of the bill passes the House.
  4. The bill is finally sent to the Senate (with some bills, debate and voting occurs simultaneously in both chambers).
  5. The Senate version of the bill is debated, amended, filibustered; and finally, the umpteenth time, it passes.
  6. At this point we have two versions of the same bill: the House version and the Senate version. Needless to say, since they evolved independently, they differ dramatically. But the Constitution says the same bill must pass both bodies before it can be sent to the president for his signature.

    What to do, what to do?

  7. The House and Senate form what is called a conference committee. Both chambers pick conferees to attend this committee, whose hearings are completely closed-door to other members. In conference, they mash the two bills together to make a single version, which each set of conferees introduces into the respective chamber.
  8. Here is the critical point: Conference committee reports are cannot be amended. They must either be passed as is -- or else rejected entirely. (They cannot be amended because then the two bills would once again differ, and the whole process would have to start all over again!)

Thus, what Rep. David Obey (D-WI, 90%) wants to do is hold off on all earmarks until the conference committee; then insert them, knowing that they cannot be amended out of the final bill. If the bill is critical, such as the emergency troop funding billl just passed, then nobody is going to reject the entire bill just beause of a paltry few billion in earmarks.

In other words, we'll have the same number of earmarks, but they'll be slipped in during the conference committee so that none of the other members of Congress can either debate them or strip them out... or even find out who inserted them in the first place. (Or more likely, more earmarks... 2006 saw 13,000 earmarks; there currently are 30,000 pending earmark requests.)

The Republicans used to do that too, though not to the same extent. Way, way back in the 109th Congress (last year), Democrats railed against earmarks in the conference committee as another example of the Republican culture of corruption:

Democrats had complained bitterly in recent years that Republicans routinely slipped multimillion-dollar pet projects into spending bills at the end of the legislative process, preventing any chance for serious public scrutiny. Now Democrats are poised to do the same.

"I don't give a damn if people criticize me or not," Obey said.

Of course not: Democrats are now the majority!

So between garden-variety earmarks slithering into the legislative process during the secret confrence committees and "phonemarks" -- telephone calls to Defense, Energy, and other administration appropriators "suggesting" that certain companies and contractors be used -- I'd say the Democrats are, indeed, all ears. And many of these earmarks personally benefit the bottom line of individual members... such as Nancy Pelosi herself:

Another key Democratic reform requires House members seeking earmarks to certify that neither they nor their spouses have any financial interest in the project.

House Speaker Nancy Pelosi (D-Calif.) did just that when she requested $25 million for a project to improve the waterfront in her home district of San Francisco. Her request did not note that her family owns interests in four buildings near the proposed Pier 35 project.

Well, the rich get richer, even if -- especially if -- the rich are Democrats. But at least now we know what "the most honest, ethical, and open Congress in history" looks like!

Hatched by Dafydd on this day, May 25, 2007, at the time of 8:41 PM | Comments (2) | TrackBack

April 9, 2007

Dems: ADM More Important Than Starving African Children

Congressional Corruption , Future of Food , Unnatural Disasters
Hatched by Dafydd

The 110th Democratic Congress -- like the 109th Republican Congress before them -- is more concerned with the profits of Archer Daniels Midland than getting food to starving African Children... and even the New York Times has noticed!

The United Nations World Food program supplies food rations to more than half a million impoverished Zambians, 50,000 of them with HIV or full-blown AIDS. But as American-made drugs gradually make Zambians healthier, they also get hungrier; and the food rations are in danger of running out, leading to possible mass starvation.

Hoping to forestall such a dire outcome, the World Food Program made an urgent appeal in February for cash donations so it could buy corn from Zambia’s own bountiful harvest, piled in towering stacks in the warehouses of the capital, Lusaka.

But the law in the United States requires that virtually all its donated food be grown in America and shipped at great expense across oceans, mostly on vessels that fly American flags and employ American crews -- a process that typically takes four to six months.

For a third year, the Bush administration, which has pushed to make foreign aid more efficient, is trying to change the law to allow the United States to use up to a quarter of the budget of its main food aid program to buy food in developing countries during emergencies. The proposal has run into stiff opposition from a potent alliance of agribusiness, shipping and charitable groups with deep financial stakes in the current food aid system.

And the Democrats in Congress seem to be as deeply in thrall to the lobbyists who represent these special interests as were the Republicans in the last Congress. So much for cleaning up the "Republican culture of corruption" to create "the most ethical Congress in history!"

The United States Agency for International Development [USAID] estimated that if Congress adopted the Bush proposal, the United States could annually feed at least a million more people for six months and save 50,000 more lives.

But the Democrats don't want to do it, and they have a glib argument for doing nothing to clean up the corruption inherent in a program that has become almost a foreign-policy "entitlement."

They claim that "decoupling" food aid from domestic agribusiness would quickly cause support for such aid to wane. But if you break it down, what they're really saying is that they, personally, will not vote for food aid unless it's really disguised corporate welfare for Big Food. After all, what difference does "support" (polling) make on Congress' decision to supply food aid -- unless Congress intends to act as a political weathercock?

Representative Tom Lantos, Democrat of California and chairman of the House Foreign Relations Committee, warned last year at a food aid conference in Washington that decoupling food aid from American maritime and agribusiness interests was “beyond insane.” [Can somebody please tell me what, exactly, lies "beyond insane?"]

“It is a mistake of gigantic proportions,” he said, “because support for such a program will vanish overnight, overnight.”

But according to the acting deputy director of USAID, James Kunder, the Bush proposal would affect only 0.5% of U.S. agricultural exports, thus could not possibly adversely affect American agriculture.

It would, however, adversely affect the bottom line of four specific companies which get most of the contracts... and it would also affect a huge percentage of congressional campaign contributions from Big Food. Now that the Democrats are the majority party, they're in line for the lion's share of that "food aid."

So they don't want to upset the gruel-cart:

Over the past three years, the same four companies and their subsidiaries -- Archer Daniels Midland, Cargill, Bunge and the Cal Western Packaging Corporation -- have sold the American government more than half the $2.2. billion in food for Food for Peace, the largest food aid program, and two smaller programs, according to the Department of Agriculture.

Shipping companies were paid $1.3 billion over the same period to move the food aid overseas, the department’s figures show....

Agribusiness and shipping groups vigorously oppose the Bush administration proposal to buy food in developing countries with cash, which they argue is more likely to be stolen. They say that American food is safer and of higher quality and that the government can speed delivery by storing it in warehouses around the world.

And they defend the idea that federal spending should benefit American business and farming interests, as well as the hungry. Without support from such interest groups, food aid budgets from Congress would wither, they say.

Well, there you are; they know the attention-span of their congressional clients.

I apologize if my sense of humor seems to drive out my sense of serious about this serious problem; but I so clearly remember then-Rep., now Squeaker of the House Nancy Pelosi's (D-Haight-Ashbury, 95%) shrill denunciation of Republicans as fostering a "culture of corruption." She added the following in an Op-Ed directly after the election:

With their votes, the American people asked for change. They cast their ballots in favor of a New Direction.

They called for greater integrity in Washington, and Democrats pledge to make this the most honest, ethical, and open Congress in history.

It's hard to know what she meant by this. Though of course, the next paragraph makes us a bit dubious that when Pelosi says "most honest, ethical, and open Congress," she is not using the normal definitions of those words found in most dictionaries...

The American people called for greater civility in how Congress conducts its work, and Democrats pledge to conduct our work with civility and bipartisanship, and to act in partnership - not partisanship - with the president and Republicans in Congress. [!]

Judging from the Democrats' responsiveness so far -- responsive to the big-money lobbyists, I mean, as the massive mound of pork larded into the supplemental war-funding bill illustrates -- I would have to stick with what I wrote in that earlier post:

So now we know what the Divine Ms. P. means by "the most honest, most open and most ethical Congress in history." She means a Congress where all the pork and beans goes to the good Democrats, rather the evil Republicans. And now that the electorate has thrown the old bums out, problem solved.

Meet the new boss...

Hatched by Dafydd on this day, April 9, 2007, at the time of 5:46 AM | Comments (5) | TrackBack

March 29, 2007

Still the Fever

Congressional Corruption , Illiberal Liberalism , Laughable Lawyers
Hatched by Dafydd

So the fever continues to rage; the entire Left (and elements of the Right) continue to demand that Attorney General Alberto Gonzales resign for... well, for some nameless offense to be filled in later.

"Let the jury consider their verdict," the King said, for about the twentieth time that day.

"No, no!" said the Queen. "Sentence first--verdict afterwards."

Despite the scary lede in the AP story (and in the New York Times, as well), there is actually nothing new in Kyle Sampson's testimony about Gonzales' involvement in discussions about firing eight U.S. Attorneys who flagrantly ignored the administration's prosecutorial priorities:

Contrary to his public statements, Attorney General Alberto Gonzales was deeply involved in the firing of eight federal prosecutors, his former top aide said Thursday, adding that the final decision on who was to be dismissed was made by Gonzales and President Bush's former counsel.

"I don't think the attorney general's statement that he was not involved in any discussions of U.S. attorney removals was accurate," Kyle Sampson, who quit this month as Gonzales' chief of staff, told the Senate Judiciary Committee. "I remember discussing with him this process of asking certain U.S. attorneys to resign."

Get it? Sampson says Gonzales discussed the process, not the specifics of who would go and who would stay. The state of play is unchanged from our earlier post last Saturday, What the Meaning of "Fizz" Is. We wrote then:

Any ordinary person, when asked if he was involved in discussions about firing the attorneys, would understand the question to mean, "Did you participate in discussions about which attorneys -- if any -- to fire?" And he would honestly say "No, I did not."

Nobody but a Democrat in full cry, anxious to find something, anything, to justify more scandalmongering, would imagine that the original question would also include any ancillary discussions about the best way to break the news to the press!

And we're sticking by it... no matter how gravely Blake Dvorak over on Real Clear Politics shakes his hoary locks... more in sorrow than in anger, you understand.

We agree with Paul Mirengoff: So far, there is no "there" there, no evidence of any lying to or misleading Congress, the American people, or anybody else. Here is the sequence of events, best as I can suss it out:

  • Around the time of the 2004 election and for some time afterwards, President Bush, Alberto Gonzales, and others receive complaints about some U.S. Attorneys: They've got a different set of prosecutorial priorities than does the administration; they're bad managers; they're unresponsive.
  • Bush tells Gonzales to do something about it. Such appointments aren't eternal; some people should go, others should stay.
  • Gonzales considers this a completely non-controversial issue (as it was and always had been), so he dumps it in the lap of his assisstant, Kyle Sampson.
  • Sampson proposes firing them all, but Gonzales rejects that idea. It's positively Clintonian.
  • Sampson has some discussions with Gonzales about what process to use to figure out who to sack, how to select replacements, how to go about getting the new attorneys confirmed (or whether to use the USA Patriot Act to bypass Senate confirmation), and finally how to announce the sackings.
  • Sampson and others in the Justice Department hold discussions, meetings, send e-mails back and forth, talk on the phone, pore over records, all about which attorneys stay and which are asked to leave. There is at this time no evidence that Gonzales was any part of this process.
  • The Justice Department group draws up a final list of people they want to replace. The list is sent to the AG.
  • Gonzales signs off on the final list and gets the president's approval. He is still unaware that, notwithstanding all the other times U.S. Attorneys have been fired for similar reasons -- and notwithstanding President Bill Clinton's firing of all 93 U.S. Attorneys when he first took office in 1993 (one, Michael Chertoff, slopped over to 1994) -- this time, it will be played by the press as a horrific and unprecedented abuse of power.
  • Democrats get hold of the list and gin up a fake controversy by falsely alleging that U.S. Attorneys were fired to stop prosecutions of Republicans. There is no evidence of this, but the Democratic Party's media wing promotes it as inarguable.
  • Gonzales is asked whether he participated in discussions about the fired attorneys. He evidently interprets the question as asking whether he participated in the discussions about which attorneys, in particular, to fire; he says no, he left that to Sampson.
  • Gonzales subsequently pours gasoline on the fire; when he is assailed in the press by nasty sound-bites from Democrats on the Judiciary Committee, Gonzales apologizes, clarifies, offers to testify, and showing other signs of weakness. Democrats scent blood in the water.
  • Democrats threaten to subpoena top presidential advisors, including Karl Rove and Harriet Miers, for political show trials -- which would likely violate the constitutional separation of powers doctrine. Nevertheless, Sen. Pat "Leaky" Leahy (D-VT, 95%) obtains the authority to issue those subpoenas... on a party-line vote in the J-Com. But he seems to have quietly dropped the idea of issuing them.

    (Was it all a bluff, just blustering to make Leahy look stronger than he really is? We'll know after a couple more weeks, I think.)

  • Democrats release documents showing that Gonzales participated in some process meetings; the elite media takes the cue, running the story as if this "contradicts" Gonzales' earlier statement.
  • Numerous members of Congress -- mostly Democrats but a few rancid Republicans, such as Sen. Arlen Specter (R-PA, 43%) -- accuse Gonzales of "lying" and "misleading" Congress when he said he wasn't involved in the attorney-firing discussions. Again, Democrats cast disagreement about the scope of the question as a federal felony, hoping to send the Attorney General of the United States to prison over political differences.
  • (Not so) shockingly, several conservative commentators and bloggers ("I name no names..."), who never liked Gonzales in the first place, seize upon these accusations to join with Democrats in calling for Gonzales' ouster... hoping, evidently, to ensure he won't be named to the Supreme Court.
  • Kyle Sampson voluntarily testifies before the J-Com, saying pretty much all of the above. The Democrats leap upon the table and perform the Grand Triumphal March from Aida, acting as if this proves everything they had alleged. (Academy awards are seriously being considered.)

The same conservatives noted above previously demanded and received Harriet Miers' withdrawal as Supreme Court nominee and Don Rumsfeld's resignation as Secretary of Defense.

Many of them currently also demand the resignation of Condoleezza Rice as Secretary of State, Michael Chertoff as Secretary of Homeland Security and the dismantling of that department. And they have complained bitterly about Gen. Michael Hayden as CIA Director, John Negroponte as the first Director of National Intelligence, and Mike McConnell as current Director of National Security. (I'm not sure what they do during the brief moments when they're not attacking the Bush administration.)

To some, this event-line provokes a non-stop threnody of the horrific "incompetence" and "dishonesty" of Alberto Gonzales. To me, it provokes nothing but annoyance that the traditional reactions and responses of bureaucrats must always be cast as demanding humiliation, dismissal, and incarceration for everyone even remotely connected... but only when the bureaucrats in question are Republicans.

Oh dear, have I discovered another Democratic double-standard... complete with conservatives eager to accept, in order it to trash their hated neocon rivals? Never mind!

Here, feast on this delicious irony instead. From the AP article linked above:

Democrats rejected the concept of mixing politics with federal law enforcement. They accused the Bush administration of cronyism and trying to circumvent the Senate confirmation process by installing favored GOP allies in plum jobs as U.S. attorneys.

"We have a situation that's highly improper. It corrodes the public's trust in our system of Justice," said Judiciary Committee Chairman Patrick Leahy. "It's wrong."

Yeah. And Webb Hubbell was appointed Associate Attorney General in 1993 solely because of his stellar record of legal achievement... and not at all because he was Hillary Clinton's partner at the Rose Law Firm in Little Rock, Arkansas. And of course, those 93 U.S. Attorneys that Clinton fired (that would be all of them) were fired strictly for job-performance issues: Each and every one of them was a lousy lawyer. No politics there!

Hatched by Dafydd on this day, March 29, 2007, at the time of 7:38 PM | Comments (6) | TrackBack

March 18, 2007

Quote of the Scandal

Congressional Corruption , Logical Lacunae
Hatched by Dafydd

I know you're more used to seeing "Quote of the Week" or "Quote of the Year;" but I am oriented more towards substance than calendar... so allow me to call this the Quote of the Fired-Attorneys Scandal. And you're not going to budge me; I am adamant!

The Drudge Report linked -- how can I get him to link Big Lizards? and would Hosting Matters explode into flinders if he did? -- about the continuing saga of eight U.S. Attorneys fired from the Bush administration for having their own set of priorities that did not match those of the White House. And let's lay one talking point to rest right away: Of course the firing was political!

It was political because policy itself is necessarily political: The administration has a set of principles of governance during time of war; those principles lead to a set of priorities of law enforcement. For example, Bush believes that controlling immigration is critcal to national security; therefore, he believes that the U.S. Attorneys should "privilege" immigration cases.

Democrats and some liberal Republicans by and large believe the opposite, that there is no connection between uncontrolled immigration and national security. Therefore, they tend to "deprivilege" immigration cases. This is a very deep, very consistent political split.

Thus, when several U.S. Attorneys (two or three of the eight) refused to prosecute or focus on immigration cases, they did so for political reasons: because their political priorities conflicted with those of the administration. And when they were subsequently fired, that too was political. However, those particular political differences form a perfectly valid basis for discharge.

Likewise anent the attorneys fired for refusing to take seriously allegations of Democratic electoral corruption: They were let go for political reasons, but those reasons were nevertheless perfectly proper.

This by way of prologue; now to the Quote of the Scandal...

The Democrats are clearly fanning the flames of scandal here -- you're way ahead of me -- for partisan political purposes: They want to make Republicans appear corrupt so they can beat them in 2008. As a prime example, here, from the story, is Rep. Rahm Emanuel (D-IL, 90%) on the subject of Republican corruption:

"Every time you get more memos, or more communications between the White House and the Justice Department, you get more facts that don't look good," said Rep. Rahm Emanuel (D-Ill.), chairman of the House Democratic Caucus. "The White House either hired a bunch of incompetent U.S. attorneys to start with, or hired a bunch of competent U.S attorneys that were incompetently fired...."

[Emanuel fails to consider a more plausible alternative: Eight of the 93 U.S. Attorneys the White House hired were competent, but they had their own agendas that prevented them from earning the pleasure of the president. So they were canned.]

Emanuel said his party would continue to focus on the corruption cases that several of the prosecutors had under way when they were fired. "One operative theory, and that doesn't mean that it's right," Emanuel said, "is that if you believe corruption was at the root of the election results, one way to handle that is to get rid of the U.S. attorneys who were pursuing corruption cases."

Why does this statement take top honors, in my opinion?

  • It conveys the implication that Republicans are somehow corrupt without actually coming out and making a specific, rebuttable accusation;
  • It looks vague but is in fact meaningless;
  • It will likely be picked up and recycled by the media, as if it were some crushing argument to which there can be no response... which is true, in a way, as you cannot respond sensibly to absolute nonsense.

Thus, Rahm Emanuel's summation is the Platonic ideal of a political statement in the midst of this entirely political non-scandal.

One operative theory, and that doesn't mean that it's right, is that if you believe corruption was at the root of the election results, one way to handle that is to get rid of the U.S. attorneys who were pursuing corruption cases.

Is Emanuel saying that this is only one theory among many? If it may not be right, yet he offers no criteria by which to judge, then why bother saying it at all? (One operative theory, and that doesn't means that it's right, is that Howard Dean is a centipede.)

Is he saying that the Bush administration believed that corruption was at the root of the 2004 election results? Does he mean Democratic corruption or Republican corruption? Does Emanuel imply that the Bush administration believes that they, themselves only won by corruption?

Or is he saying that the Democrats believe that Bush only won by corruption? Which states does he believe were so corrupted that they wrongly cast their electoral votes for Bush?

And in any event, does "you," the subject of the primary verb "believe," persist as the implied actor of the infinitive "to get rid of" in the final clause? If so, that would mean it was the Democrats who "got rid of" the attorneys -- so that can't be right! But then, who is the implied actor... the Bush administration? How many separate and contradictory subjects is a sentence allowed to have?

So what in the hell is he actually saying? I don't see any hands raised, except for the grammarians in the back... and I suspect theirs are raised, not to answer the question, but in unconditional surrender.

Thus I dub this quotation the synecdoche of the Democratic response to this firing, and to the Bush administration in general: They know (in a Gnostic sense) that there is some horrific, Lovecraftian corruption in there somewhere, but they just can't quite wrap their tentacles around it.

Hatched by Dafydd on this day, March 18, 2007, at the time of 5:53 PM | Comments (7) | TrackBack

February 16, 2007

Not A-Feared We're Gonna Lose...

Congressional Calamities , Congressional Corruption , Iraq Matters
Hatched by Dafydd

The more success we have in our new strategic change of course in Iraq -- the more desperate the Democrats become to stop it in its tracks. The dynamic has become as crystal: the Democrats are not afraid we'll lose... they're frantic that we might somehow win.

Their entire political strategy is based upon the assumption that Iraq in 2008 will be even more a catastrophe than today (and they have very funny ideas of how bad it is today).

Thus, I am hardly shocked that the Democrats in Congress, perhaps stunned by the speed with which President Bush's new strategy appears to be bearing fruit, have gone back on their word... and now openly threaten to cut off funding to end the war, a tactic which only a couple, three weeks ago was dismissed by both Majority Leader Harry Reid (D-Caesar's Palace, 100%) and Squeaker of the House Nancy Pelosi (D-Haight-Ashbury, 100%) as Republican paranoia:

Democrats are challenging President Bush's power to wage war, contending they've found a way to block a troop increase in Iraq and prevent any pre-emptive invasion of Iran....

"This country needs a dramatic change of course in Iraq and it is the responsibility of this Congress to consummate that change," said Rep. John Murtha, who chairs the House panel that oversees military spending.

Murtha, D-Pa., is preparing legislation that would set strict conditions on combat deployments, including a year rest between combat tours; ultimately, the congressman says, his measure would make it impossible for Bush to maintain his planned deployment of a total of about 160,000 troops for months on end.

The Fox News "All-Stars" had a lively discussion of Rep. John Murtha's (D-PA, 100%) scheme on Brit Hume yesterday: The basic idea is to set up a series of "benchmarks" -- not for the Iraqis to achieve, not even for the soldiers and Marines to achieve in the field; the benchmarks are "readiness" and "rest" standards that American units must meet in order for the Commander in Chief to be allowed by Congress to send them to Iraq.

(And the scheme is probably an unconstitutional violation of the separation of powers.)

The standards are ludicrous. For example, units cannot be deployed to Iraq if they have been in the United States less than one year, no matter what. They cannot be deployed if they have not received some very high level of training. Troops' tours cannot be extended; stop-loss extensions are forbidden; equipment must be up to some impossible standard... and all these must be reported, certified by the president, and (presumably) agreed to by Congress before the president is allowed to deploy any troops.

To Iraq, that is; none of this nonsense on stilts would apply to units being deployed to Afghanistan.

In an interview on the website (in a passage now "sanitized" from the site), Murtha made his intentions clear -- and it's not simply to prevent the so-called "surge" in Iraq:

The Appropriations Subcommittee on Defense has begun consideration of the president’s $93 billion supplemental appropriations request for Iraq. Action on the request will be the first opportunity for the new Congress to exercise its “power-of-the-purse” over the Iraq war.

Chairman Murtha will describe his strategy for not only limiting the deployment of troops to Iraq but undermining other aspects of the president’s foreign and national security policy. Chairman Murtha discusses these steps in a videotaped conversation with former Congressman Tom Andrews (D-ME), the National Director of the Win Without War coalition, sponsor of

In the discussion on Special Report, Hume, Fred Barnes, Mort Kondracke, and Nina Easton (no Mara yesterday) all agreed that the actual effect of the Murtha bill, if it were passed into law, would be to prevent reinforcements from arriving to relieve the augmented troop levels that will already be in country long before that point. They also all agreed that the bill has no chance at all of actually being enacted: It will never make it through the Senate and might not even pass the House, if the Republicans were to expose and attack it for what it really is.

Nina Easton thought it was good politics for the Democrats: They appear to be "pro-troops," looking out for their welfare, when in fact their real intent is to block the strategic change of course in Iraq. But both Fred and Mort, the "Beltway Boys," thought it would in fact turn out to be terrible politics for the Democrats, and I agree:

  • Even many of those who oppose the troop increase (a small but necessary part of the change of course) will balk at the idea of cutting off funding after the troops have already arrived, which is what the Murtha scheme would do;
  • This feeds directly into the traditional weakness of the Democrats on national defense, that they are so allergic to war that they actually prefer us to lose rather than win;
  • Even those who won't go that far might still think it feckless for Congress to try to micromanage the exact level and location of future troop deployments;
  • Since the FY 2007 budget is already appropriated, funding the DoD through September, President Bush can simply move funds from other DoD projects to fund the war; the Supreme Court has already ruled that this is within the Executive's authority; thus, Congress cannot cut off funds until at least October;
  • But by October, the Democrats' worst fears may be realized: it may already be obvious that the new strategy is working, and working so well that even the big-box media cannot cover it up.

Thus, it's almost a given that the Murtha scheme is doomed to fail -- which will make it all the more likely that moderate Democrats in the House will defeat it, led by Majority Leader Steny Hoyer (D-MD, 95%), who beat John Murtha out of that post and still bears ill will, and who has already come out against the Murtha scheme.

When the Democrats are unable to act on the supplementary budget request for the troops, they will have to scramble to accept it as is, without the Murtha scheme attached. This will humiliate and disempower Murtha within the Democratic caucus, relative to Hoyer.

What is most likely to happen then is that the frustrated Defeat Caucus in the House, having failed to enact the Murtha scheme, will push something even more radical... possibly a naked cut-off of funding to the troops in the field, essentially telling our soldiers and Marines in combat to "dry up and blow away."

By then, unless the liberal Democrats come to their senses somewhere in the middle and stop themselves, they will finally restore the natural distinction between Republicans who support victory in the war and Democrats who support only defeat, dishonor, and disaster. (The distinction had grown blurry with the small number of "white-flag Republicans" infesting the Congress.)

As always, the lizards are optimistic: I still bet on George W. Bush to keep up the good, very good fight in Iraq against both al-Qaeda and also the millenarian cult of Shiite death squads -- rather than betting on the antics of the defeatist Democrats in House and Senate. The fight is not just good for the GOP; it's vital for the future of Western civilization.

Hatched by Dafydd on this day, February 16, 2007, at the time of 5:18 AM | Comments (9) | TrackBack

December 14, 2006

That Was Thener; This Is Even Nower

Congressional Corruption , Terrorism Intelligence
Hatched by Dafydd

This is an update to our previous post a couple of weeks ago, That Was Then, This Is Now. In that post, we linked to a Washington Post story about the Democrats rejecting the most important congressional reform of intelligence that the 9/11 Commission recommended. Oddly, however, I notice now that I forgot to quote from it! I can only plead premature senility and correct the oversight now:

It was a solemn pledge, repeated by Democratic leaders and candidates over and over: If elected to the majority in Congress, Democrats would implement all of the recommendations of the bipartisan commission that examined the attacks of Sept. 11, 2001.

But with control of Congress now secured, Democratic leaders have decided for now against implementing the one measure that would affect them most directly: a wholesale reorganization of Congress to improve oversight and funding of the nation's intelligence agencies. Instead, Democratic leaders may create a panel to look at the issue and produce recommendations, according to congressional aides and lawmakers.

Well that Democratic panel has now produced its recommendations... and sure enough, the panel's only recommendation is -- to create another panel!

If you parse through the Clintonspeak, they're not accepting the recommendation of the 9/11 Commission to remove control of the funding of intelligence agencies from the Appropriations committees and give it instead to the Intelligence committees:

[Rep. Nancy] Pelosi, D-Calif. [100%], also said that one of the first tasks of the Democratic-controlled House she will lead beginning in January will be approving the recommendations of the 9/11 Commission, including taking steps to make intelligence decisions more transparent.

The Select Intelligence Oversight Panel proposed by Pelosi would be made up by members of the Appropriations Committee and the Select Committee on Intelligence, and would work within the Appropriations Committee.

Simply put, if the panel works "within the Appropriations committee," then it's controlled by that committee -- and that means Appropriations will still control the budget that will be "overseen" by the panel that it also controls:

[The panel] would examine, through hearings, the president's intelligence budget, prepare the classified annex to the annual defense spending bill and conduct oversight of the use of appropriated funds by intelligence agencies.

In other words, it will not itself appropriate the funds or even (it appears) recommend to the Appropriations committees how much to appropriate or how to use those appropriations. And it goes without saying (though I'm going to say it anyway) that nowhere in this statement does Pelosi or anyone else say that Appropriations will lose budgetary control over the clandestine and intelligence agencies, as the 9/11 Commission recommended, nor that the House and Senate Permanent Select Committees on Intelligence will gain that budgetary authority.

In fact, they don't even pledge to create a new Appropriations subcommittee devoted to intelligence... the bare minimum recommendation of the commission, which they offered if Congress couldn't bring itself to strip Appropriations of the least little bit of control.

Rather than actually accept the recommendations of the 9/11 Commission -- which are very clear (see our previous post) -- the Democrats plan only to create a PR stunt instead: a "panel" that is controlled by the Appropriations committees and will simply ensure that the administration actually uses the money as Appropriations directs.

Nancy Pelosi and Sen. Harry Reid (D-Wynn Las Vegas, 100%) believe they can get away with creating a committee to study the committee, rather than actually implement the recommended change.

But you know what I think? I believe that this time, they may not get away with it: if the Washington Post, of all liberal media outlets, is already publishing a major story chastising them for blowing off the Commission (after campaigning obsessively on "fully implementing" those same recommendations)... then the incoming Democratic 110th may find it's no longer immune from harsh criticism -- in any medium.

Hatched by Dafydd on this day, December 14, 2006, at the time of 4:54 PM | Comments (1) | TrackBack

November 18, 2006

The Democrats Are All Ears

Congressional Corruption
Hatched by Dafydd

In two previous posts, we discussed how incoming Squeaker of the House Nancy "Most Ethical Congress In History" Pelosi isn't quite living up to her mantra anent the "culture of corruption" in Congress, especially regarding earmarks:

What exactly are earmarks? We described them thus in the first post linked above:

Let's take a brief detour: we know what the politician gets out of the contact: loot. The lobbyist funnels a bunch of campaign contributions to the pol, or donations to the Clinton Library, or whatnot. This can add up to a lot of lettuce -- millions of dollars in the case of Cunningham, for example.

Now, we assume the lobbyists (and the special interests they represent) aren't the generous sort. They're not giving away bucks and perks for free! So what do they get in return? What would be so valuable to a corporation, say, that they would be willing to spend several hundred thousand dollars of squeeze to get it?

The payback, of course, is in government expenditures inserted into public bills which go to private corporations for purely private purposes. In a word, earmarks.

Just remember: an earmark is the primary means of payback by a politician to a private person or company in exchange for the legal bribery of campaign contributions; it is the "quo" in the quid pro quo.

A company bundles contributions of, say, $300,000 to a politician; in exchange, in the dead of night, often during House-Senate conferences, he (anonymously) slips an earmark into an unrelated bill that funnels $3,000,000 to that company to build a Museum of Earwax in Harrisburg, PA. The pol gets funding for his reelection; the company gets a 1,000% return on investment, and the taxpayers get hosed.

In today's New York Times, we've started to find out the contours of just what the Democrats meant when they said they would clean up the "Republican culture of corruption." Interestingly, it doesn't appear to include earmarks -- which are the biggest problem:

Their initial proposals, laid out earlier this year, would prohibit members from accepting meals, gifts or travel from lobbyists, require lobbyists to disclose all contacts with lawmakers and bar former lawmakers-turned-lobbyists from entering the floor of the chambers or Congressional gymnasiums. [That's harsh... congressmen turned lobbyists will no longer be able to use the Stair Stepper or the House basketball court. That's got to hurt.]

None of the measures would overhaul campaign financing or create an independent ethics watchdog to enforce the rules. Nor would they significantly restrict earmarks, the pet projects lawmakers can anonymously insert into spending bills, which have figured in several recent corruption scandals and attracted criticism from members in both parties. The proposals would require disclosure of the sponsors of some earmarks, but not all.

I have the strangest sense of déjà vu; where did I hear this before? Oh yes, here we go... in both of the two previous Big Lizards posts linked above, I noted that "Democrats in the House voted 147 to 45 against the Republican rules change that identified all earmarks and their congressional sponsors." That's more than 3-1 against identifying the sponsors of earmarks.

And this wasn't a revolt of the rank and rile; the opposition was led by the Democratic leadership. From Captain's Quarters:

The vote shows who on the Hill gets the new paradigm, and who still lives in the passing age of pork. Democrats voted 147-45 to defeat the new rule, and that included their leadership. Among those opposing the identification of earmarks are Nancy Pelosi, Sheila Jackson-Lee, Patrick Kennedy, Tom Lantos, Dennis Kucinich, John Conyers, Betty McCollum, Allan Mollohan, Barney Frank, Henry Waxman, and Ike Skelton, some of whom have been named as committee chairs if the Democrats retake control of the House this fall. Alcee Hastings voted to continue the practice of secret earmarking, no surprise given his impeachment for bribery that removed him from the federal judiciary, and the Democrats want to put him in charge of the Intelligence Committee. Jane Harman, the ranking Democrat on the committee now, voted to support the rule.

In contrast, only 24 Republicans voted against the rule, and all but two of those are appropriators. Twelve GOP appropriators voted for reform, however, including Ray LaHood, a surprise supporter of the rule.

Given such opposition just a few months ago, we opined that it's just not that likely that the Democratic leadership would have a sudden "road to Damascus" conversion... especially not after gaining the majority, which means starting to get the lion's share of those "quids" again. You don't reduce a taste for pork by offering a big plate of barebecued spareribs. So it's hardly a shock if the new majority decides it rather likes ears even more than it did as a minority.

It is a bit breathtaking, however, so watch them spin 180° after the election, but before even taking the gavel. That may have set a new land speed record for hypocrisy!

But if the Democrats don't see earmarks or other form of quid pro quo as the core of the "culture of corruption," what do they see? Oh, that's easy... the problem is just Republicans, who evidently are uniquely and genetically prone to corruption and evil-doing. From the Times article:

Other Democratic lawmakers argued that the real ethical problem was the Republicans, not the current ethics rules, and that the election had alleviated the need for additional regulations. “There is an understanding on our side that the Republicans paid a price for a lot of the abuses that evolved,” said Representative Barney Frank, Democrat of Massachusetts, alluding to earmarks. Senator Tom Harkin, an Iowa Democrat and a senior member of the Appropriations Committee, said the scandals of the current Congress were “about the K Street Project for the Republicans,” referring to the party’s initiative to put more Republicans in influential lobbying posts and build closer ties to them.

“That was incestuous from the beginning. We never had anything like that,” Mr. Harkin said of Democrats. “That is what soured the whole thing.”

And there you have it: the problem with the "Republican culture of corruption" was only the first word; when Democrats like Nancy Pelosi, John Murtha, Harry Reid, Barney Frank, Tom Harkin, and Dianne Feinstein do the same thing, it's totally different. After all, as the Party of the People, when Democrats secretly insert earmarks into a transportation or war-funding bill -- it's for a jolly good reason!

So now we know what the Divine Ms. P. means by "the most honest, most open and most ethical Congress in history." She means a Congress where all the pork and beans goes to the good Democrats, rather the evil Republicans. And now that the electorate has thrown the old bums out, problem solved.

Meet the new boss...

Hatched by Dafydd on this day, November 18, 2006, at the time of 4:36 PM | Comments (8) | TrackBack

Spanking Nancy

Congressional Corruption
Hatched by Dafydd

The New York Times, of all sources, delivers a wallop to the behind of the incoming Squeaker of the House, Nancy Pelosi (D-San Francisco, 100%):

Nancy Pelosi has managed to severely scar her leadership even before taking up the gavel as the new speaker of the House. First, she played politics with the leadership of the House Intelligence Committee to settle an old score and a new debt. And then she put herself in a lose-lose position by trying to force a badly tarnished ally, Representative John Murtha, on the incoming Democratic Congress as majority leader. The party caucus put a decisive end to that gambit yesterday, giving the No. 2 job to Steny Hoyer, a longtime Pelosi rival.

But Ms. Pelosi’s damage to herself was already done....

As incoming speaker, Ms. Pelosi will be dogged by skepticism — from within the party and without — about her political smarts and her ability to deliver a galvanized agenda.

Ouch. I don't think the Divine Ms. P. will be attending any sit-down dinners for a while. (Link via Drudge.)

Hatched by Dafydd on this day, November 18, 2006, at the time of 6:02 AM | Comments (3) | TrackBack

November 13, 2006

Has Nancy Pelosi Changed Her Mind About Ears?

Congressional Corruption
Hatched by Dafydd

Incoming Squeaker of the House Nancy Pelosi (D-San Francisco, 95%), who led the failed Democratic resistance against the Republican House rule requiring full disclosure of members of Congress who sponsor earmarks (which includes Nancy Pelosi), now wants us to believe that she is poised on the brink of an about-face... now that the Democrats can get credit for what the Republicans already passed over Democrats' objection.

Incoming Majority Leader Sen. Harry Reid (D-Caesar's Palace, 100%) now preens, fluffing up his feathers as another crusader against congressional pork.

But is there any reason to take seriously either of the two Democratic leaders who have captured Congress? Has either shown any previous interest in reforming congressional corruption, which is expressed most effectively in the form of "earmarks?"

Yesterday, in the Missing Earpiece, I noted that Mrs. Pelosi never seems to have met an ear she didn't like. The Los Angeles Times agrees:

[Nevada Sen. Harry] Reid is not the only powerful member known to use the practice. Incoming House Speaker Nancy Pelosi, a former appropriations panel member, has used earmarks prodigiously....

Last week, when Reid's status rose as Democrats took control of the Senate after the midterm election, the senator promised, like Pelosi, to make earmark reform a top priority when party members caucused.

Hm. Recall that the Democrats in the House voted 147 to 45 against the Republican rules change that identified all earmarks and their congressional sponsors. From Big Lizards' earlier post:

Whenever a new session of Congress begins, the majority typically incorporates the previous rules by voice vote; but it isn't required to do so. In this case, there is reason to doubt the zeal of Mrs. P. and her partisans for this particular program... given that she and the rest of the Democratic leadership, along with most of the Democrats, voted resoundingly against it by more than 3-1 when the Republicans forced it through.

(I link to Captain's Quarters in the previous post; Captain Ed, along with the rest of PorkBusters, has been one of the blogospheric leaders in the fight against pork.)

And recall also that the various changes that Nancy Pelosi and the House Democrats proposed did not include any specific repudiation or ban on earmarks, or even a committment to maintain the Republican rule that makes them transparent (after the 2007 budget). Again, from the earlier post on this blog:

Now, I want to be totally fair about this. One of the planks of Mrs. Pelosi's program could perhaps be stretched to cover this most invidious legal bribery. It's the last one:

"And subject government contracts to public disclosure and aggressive competition."

But I'm dubious. Why not just use the word "earmarks," which everybody already knows...?

If the Democrats had meant to curtail earmarks, they would have mentioned them by name, rather than use such nebulous circumlocutions as "government contracts." Heck, they don't even say "all government contracts!"

All right; how about the Senate Democrats? Will they be the vanguard of reforming the culture of corruption in Congress? Doubtful, perhaps:

In earlier years, Reid has boldly claimed credit for getting earmarks for his constituents. Last year, he boasted of securing $300 million in earmarks in the transportation bill.

When pressed about his position on earmarks in an interview on public television in January, Reid acknowledged abuses, but added: "There's nothing basically wrong with earmarks. They've been going on since we were a country."

Actually, earmarks have skyrocketed in recent years, from 1,439 in 1995 to 15,268 last year, according to a Senate estimate.

That is, Reid insists there is "nothing basically wrong" with powerful senators and representives forcing Arizona and New Mexico and Vermont to pony up for a bridge that only benefits Alaska... and another one that only benefits Nevada -- and actually puts money directly into Harry Reid's own pocket:

Incoming Senate Majority Leader Harry Reid vows to make reform of congressional earmarks a priority of his tenure, arguing that members need to be more transparent when they load pet projects for their districts into federal spending bills.

But last year's huge $286-billion federal transportation bill included a little-noticed slice of pork pushed by Reid that provided benefits not only for the casino town of Laughlin, Nev., but also, possibly, for the senator himself.

Reid called funding for construction of a bridge over the Colorado River, among other projects, "incredibly good news for Nevada" in a news release after passage of the 2005 transportation bill. He didn't mention, though, that just across the river in Arizona, he owns 160 acres of land several miles from proposed bridge sites and that the bridge could add value to his real estate investment.

I suspect the rules change in the House will remain: if the same number of Democrats vote for it in January 2007, when it can be spun as a Democratic rule, as did in September 2006, when it was a Republican rule, that means 45 Democratic Ayes. Last time, 199 Republicans and Independent Bernie Sanders (I-VT, 100% Dem) voted for the earmark-transparency rule (and 24 Republicans voted against it).

Reformers need 218 votes in the incoming Congress to maintain this rule... assuming it isn't denied a vote via some bizarre manipulation of the process. If all those who voted in favor of the vote last time (Republican and Democrat) do so again, then subtracting those who were defeated (or who didn't run for reelection), and assuming that every Republican successor to a Republican who supported the rule will also support the rule, we have the following:

  1. 199 Republicans minus 28 defeated by Democrats leaves 171 votes supporting the rule;
  2. 1 Independent replaced by a Democrat still leaves 171 Ayes;
  3. 45 Democrats who voted Aye -- this is the only number I'm not sure of; how many of these Democrats retired and were replaced by Democrats who would oppose the rule? I have no reasonable way to find out.

But assuming number 3 remained steady, then that would give us 216 votes. So if only two extra Democrats support the bill now -- or if the new Republican Minority Leader can armtwist a couple of GOP Nays into Ayes -- the earmark-transparency rule will remain.

But the acid test will be how many Democrats vote to keep it. Words are a whisper, but deeds are a shout: unless Mrs. P. can bring an overwhelming majority of her caucus to support earmark reform in 2007 -- to match the overwhelming majority of Democrats who opposed it in 2006 -- she will have a very hard time claiming credit for it, and any future reference to the "Republican culture of corruption" will provoke howls of laughter.

This is a surprisingly good article from the newspaper that Patterico rightly calls the "L.A. Dog Trainer." The entire first part goes into some detail about Reid's boondoggle bridge, and how he introduced an earmark that likely will quite directly enrich himself.

But it certainly raises a very serious question whether either Harry Reid or Nancy Pelosi is really the fittest person to lead a grand crusade against pork... or to sling around terms like "the Republican culture of corruption."

Too bad the L.A.Times didn't publish this piece a month ago. But I suppose it was merely the press of more important news (the Abramoff scandals, Tom DeLay) that pushed this example of blatant Democratic corruption all the way to November 13th, six days after the mid-term election.

Hatched by Dafydd on this day, November 13, 2006, at the time of 7:53 PM | Comments (1) | TrackBack

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