Gale Norton Loves Her Some Sex, Meth and Oil

Gale Norton, former Bush Pioneer,1 has no regrets about the shambles she left behind in her wake, before she joined Royal Dutch Shell.

I like to eat paste

Gale Norton, former President George W. Bush’s first Secretary of the Interior, ran the department during the time when its Minerals Management Service was guilty of some of its worst excesses—including holding cocaine and meth-fueled sex and oil parties. But that didn’t stop Norton from taking to Capitol Hill Tuesday to defend the “hardworking and professional men and women of the Minerals Management Service.”

Norton was one of two Bush-era Interior secretaries who testified before the House Energy and Commerce Committee Tuesday morning, the first time representatives from the previous administration have been put on the hot-seat about the regulatory miscues that may have led to the Deepwater Horizon disaster. Current Secretary Ken Salazar joined Norton (who served in the role from January 2001 to March 2006) and Dirk Kempthorne (June 2006 to January 2009) before the panel.

In her opening statement, Norton accused critics of the Interior Department of vilifying the Minerals Management Service (now renamed the Bureau of Ocean Energy Management, Regulation and Enforcement). “There has been a great deal of media attention to the ethics of MMS. It pains me to see the vilification of MMS and its employees. I want to speak in defense of the vast majority of hardworking and professional men and women of the Minerals Management Service,” said Norton in her prepared opening statement.

Now, it was under Norton’s watch that many of the porn, meth, and oil parties took place at the MMS’ Lake Charles, La. office. Oh, and the sex, oil, and cocaine parties at the Lakewood, Colorado office. And Norton, who went to work for Shell Oil shortly after leaving office, has been the subject of a Department of Justice criminal investigation into whether she illegally used her position at DOI to benefit the company that would hire her soon thereafter

(click to continue reading Bush Official on Sex, Meth and Oil: What’s the Big Deal? | Mother Jones.)

Jerkstore

Footnotes:
  1. well, probably, too lazy to look her up []

Chicago Corruption

Nice spin by Ronald Safer – Chicago isn’t more corrupt than other cities, it only seems that way because the US Attorney’s Office is so effective at rooting out the corruption. Well, that’s one way of looking at the situation I guess.

Pillars of Construction

For more than three decades, the United States Attorney’s Office in Chicago has made its reputation successfully prosecuting public servants. It has sent to prison Cook County judges, scores of Chicago aldermen and other City Hall officials, as well as former Gov. George Ryan. But in terms of pure news media spectacle and national profile, the Blagojevich trial may be the biggest test yet for an office with a storied legacy.

“The hobby of the office has been public corruption,” said Scott Lassar, the United States attorney whom Mr. Fitzgerald succeeded in 2001.

Though there is a common perception that the city’s politics are corrupt, “I don’t think it is only because corruption is rampant in Chicago and nowhere else,” said Ronald S. Safer, who worked as an assistant United States attorney from 1989 to 1999 and is now managing partner at the law firm Schiff Hardin. “It is, in part, because the F.B.I. and United States attorney’s offices have gotten so effective at uncovering it” that Chicago has a higher percentage of corruption cases.

(click to continue reading Chicago News Cooperative – Passion and Success in U.S. Attorney’s Office – NYTimes.com.)

Blagojevich Country

The contrary view is that Chicago is incredibly and deeply corrupt, there are so many prosecutions here because the US Attorney’s Office doesn’t have to look very hard to find illegal activity.

Federal Regulators Let Oil Regulate Itself

Typical, actually, though still irritating. Wouldn’t it be nice to live in a country where the government actually cared about enforcement of safety regulations of all sorts, and didn’t defer to the industries and their lobbyists? I know I would.

Displaced Truths - oil

“Federal regulators warned offshore rig operators more than a decade ago that they needed to install backup systems to control the giant undersea valves known as blowout preventers, used to cut off the flow of oil from a well in an emergency.

The warnings were repeated in 2004 and 2009. Yet the Minerals Management Service, the Interior Department agency charged both with regulating the oil industry and collecting royalties from it, never took steps to address the issue comprehensively, relying instead on industry assurances that it was on top of the problem, a review of documents shows.

In the intervening years, numerous blowout preventers and their control systems have failed, though none as catastrophically as those on the well the Deepwater Horizon drilling rig was preparing when it blew up on April 20, leaving tens of thousands of gallons of oil a day spewing into the Gulf of Mexico.

Agency records show that from 2001 to 2007, there were 1,443 serious drilling accidents in offshore operations, leading to 41 deaths, 302 injuries and 356 oil spills. Yet the federal agency continues to allow the industry largely to police itself, saying that the best technical experts work for industry, not for the government.

Critics say that, then and now, the minerals service has been crippled by this dependence on industry and by a climate of regulatory indulgence.”

(click to continue reading Federal Regulators’ Warnings on Safety Weren’t Acted On – NYTimes.com.)

Assholes.

Republicans Mindlessly Support Wall Street Criminals

To the Republicans on the SEC, and elsewhere, corporate crime is a category that does not exist. Even crooks like Goldman Sachs predictably are supported by Republicans. Shameful.

Urban archeology SwankoPrint version

The Securities and Exchange Commission decided to sue Goldman Sachs Group Inc. over the objections of two Republican commissioners, suggesting an unusual split at the agency that could politicize one of its most prominent cases in years.

People familiar with the matter said the five-member commission held a lengthy meeting Wednesday to debate the civil-fraud charges against Goldman, and ultimately voted 3-2 in favor of pushing forward. The charges were filed Friday.

Normally the agency prefers to have unanimous support when bringing enforcement actions against the firms it regulates. Word of the SEC split could exacerbate partisan tensions in Washington over the Obama administration’s proposed financial-regulatory overhaul.

[Click to continue reading SEC Was Split Over Goldman Case – WSJ.com]

Fraud is partisan, apparently

On Tuesday, SEC Chairman Mary Schapiro is likely to get a grilling over the internal dissent when she appears before the House Financial Services Committee for scheduled testimony.

People familiar with the vote said Ms. Schapiro—a registered independent—joined two Democrats on the commission, Elisse Walter and Luis Aguilar, in supporting the fraud case against Goldman. The two Republican commissioners, Kathleen Casey and Troy Paredes, were opposed, they said.

Again, this sounds like whining to me, there are five members of the SEC for a reason, just like there are 12 jurors in a criminal case, and 9 Supreme Court justices, sometimes there are differences of opinion on important matters. Expecting that every decision is unanimous translates into Doing Nothing, and while that is the Republican mantra, the rest of us would like Wall Street to be reined in.

Goldman Whines It Was Blindsided by The Law

Poor lil’ Goldman Sachs didn’t get a memo from the S.E.C. before the case went public. Of course, when the police arrest a serial killer they give at least 48 hours to the suspect so that the evidence can all be boxed up neatly. Right? I don’t care if this is common practice for Wall Street criminals, it shouldn’t be. I hope the Security and Exchange Commission has changed their modus operandus, and no longer is complicit with covering up financial malfeasance.

Funny also how the Republicans are all for law and order, when it applies to non-white collar crimes, but when their donor class is threatened, the tune changes.

crime plus 8 mailbox

Goldman Sachs Group Inc. officials said they knew as far back as August 2008 that regulators were examining controversial mortgage securities created by the firm but were stunned by the bombshell civil fraud suit lodged against it Friday, with most having learned about it from news reports.

Firms typically get a chance to settle such suits, but not in this case, Goldman said. The Wall Street giant said it was alerted to the probe in the summer of 2008 and was warned that it might face a suit in July 2009. It says it then responded in detail to the Securities Exchange Commission’s inquiry in September, but heard nothing back from the government until Friday’s unveiling of the civil suit. The SEC usually notifies firms ahead of a lawsuit as a courtesy to give them a chance for a last-ditch settlement or to prepare for the public fallout.

Lawsuits by the SEC are subject to a vote by the agency’s five commissioners, and the tally on the Goldman case will be closely watched in Washington, as the current commission is split along party lines—with two Republicans and two Democrats, plus one independent who was appointed by President Obama.

The way the SEC launched the suit “certainly doesn’t follow the spirit” or practice of the agency, said Paul Atkins, who served as a Republican SEC commissioner.

[Click to continue reading Goldman Contends It Was Blindsided by Lawsuit – WSJ.com]

Well, Paul Atkins is part of the problem then, isn’t he? If SEC commissioners aren’t interested in regulating Wall Street, they should go ahead and resign to get a job in a Wall Street bank.

Looters in Loafers

Goldman Sachs, aka Gold Sacks, aka corporate criminals, are not having a good PR month. They are an easy target – so greedy, so arrogant that even their allies are keeping mum. Whether any real penalties will be levied against Goldman Sachs remains to be seen.

Financial Blues Brothers

Paul Krugman writes, in part:

Most discussion of the role of fraud in the crisis has focused on two forms of deception: predatory lending and misrepresentation of risks. Clearly, some borrowers were lured into taking out complex, expensive loans they didn’t understand — a process facilitated by Bush-era federal regulators, who both failed to curb abusive lending and prevented states from taking action on their own. And for the most part, subprime lenders didn’t hold on to the loans they made. Instead, they sold off the loans to investors, in some cases surely knowing that the potential for future losses was greater than the people buying those loans (or securities backed by the loans) realized.

What we’re now seeing are accusations of a third form of fraud.

We’ve known for some time that Goldman Sachs and other firms marketed mortgage-backed securities even as they sought to make profits by betting that such securities would plunge in value. This practice, however, while arguably reprehensible, wasn’t illegal. But now the S.E.C. is charging that Goldman created and marketed securities that were deliberately designed to fail, so that an important client could make money off that failure. That’s what I would call looting.

And Goldman isn’t the only financial firm accused of doing this. According to the Pulitzer-winning investigative journalism Web site ProPublica, several banks helped market designed-to-fail investments on behalf of the hedge fund Magnetar, which was betting on that failure.

So what role did fraud play in the financial crisis? Neither predatory lending nor the selling of mortgages on false pretenses caused the crisis. But they surely made it worse, both by helping to inflate the housing bubble and by creating a pool of assets guaranteed to turn into toxic waste once the bubble burst.

[Click to continue reading Op-Ed Columnist – Looters in Loafers – NYTimes.com]

Continuing to Talk

and the part that interests me, as a non-Wall Street banker, will the proposed financial reforms stop future meltdowns?

The obvious question is whether financial reform of the kind now being contemplated would have prevented some or all of the fraud that now seems to have flourished over the past decade. And the answer is yes.

For one thing, an independent consumer protection bureau could have helped limit predatory lending. Another provision in the proposed Senate bill, requiring that lenders retain 5 percent of the value of loans they make, would have limited the practice of making bad loans and quickly selling them off to unwary investors.

It’s less clear whether proposals for derivatives reform — which mainly involve requiring that financial instruments like credit default swaps be traded openly and transparently, like ordinary stocks and bonds — would have prevented the alleged abuses by Goldman (although they probably would have prevented the insurer A.I.G. from running wild and requiring a federal bailout).

Read the rest

TIF Slush Fund

Mayor Daley’s budget is in deficit, municipal projects don’t get funded, schools don’t get funded, yet developers can get as much TIF money1 as they need, no matter what. No consequences, no strings. Just plain ole corporate welfare.

Half Done

A city panel approved another major increase in financial assistance for planned Loop apartment development that has struggled to get off the ground because of rising costs and the tough lending climate.

The Community Development Commission signed off Tuesday on a $34-million tax-increment financing subsidy to help pay for the conversion of a vintage Loop office tower at 188 W. Randolph St. into a 310-unit apartment building.

That’s more than four times the $8 million in TIF funds the city initially approved for the development back in 2006, when its total cost was estimated at $79 million.

But the projected cost had soared to $139 million in 2008, and the project’s developer, Village Green Cos., went back for more. The city complied by hiking the subsidy to $20 million.

[Click to continue reading Loop project poised to get another big TIF boost – Chicago Real Estate Daily]

Via Lynn Becker, who adds:

When, in 2006, a developer announced plans to rehab Vitzhum & Burns Steuben Club Building at 188 W. Randolph, an $8 million dollars contribution from the massive Central Loop TIF was going to kick in about 10% of the $79 million cost.

But wait – there’s more! The project is also getting $40 million dollars in tax-exempt bonds from the state, plus $37 million in tax credits. You, lucky taxpayer, kick in almost half of the project cost and the private developer gets the building. Socialism, Chicago style.

When Draconian cutbacks are effecting everything in Chicago from the CTA, to the schools, to 4th of July Fireworks, the city is diverting another $26 million in tax revenues to an economically unsustainable development.

[Click to continue reading ArchitectureChicago PLUS: Welfare Queen]

Really disgusting. The Vitzthum & Burns Steuben Club Building is not a cookie-cutter square box, but it isn’t in the upper echelon of Chicago architecture either.

from a CBS Chicago report (presumedly based on the press release from Village Green Companies)

The Community Development Commission approved a plan to redevelop the vacant and historic Randolph Tower at 188 W. Randolph St. into 310 apartments, retail and commercial space, according to a release from the CDC.

The action recommends the designation of Village Green Companies as the developer for the proposed $145 million renovation.

Plans call for the mixed-use building, formerly known as the Steuben Club Building, to be converted into 168 studios, 98 one-bedroom and 44 two-bedroom units, the release said. Sixty-two of the residential units will be made affordable to households at or below 50 percent of median area income.

Village Green bought the 45-story office building out of bankruptcy in 2005 and will convert the 80-year-old structure into apartments. Plans also include 9,500 square feet of ground floor restaurant and retail space. Village Green will occupy 11,400 square feet on the second floor as its Chicago regional office.

Amenities will include a fitness center, swimming pool and spa. A social club will be located on the 38th and 39th floors, offering 360-degree views of the skyline and Lake Michigan, the release said.

The Gothic-style building will have extensive work done to preserve its historic terra cotta façade and other ornamental details and a gut rehabilitation of the interior.

The CDC also approved a redevelopment plan for the proposed Randolph/Wells tax increment financing district. Creation of the district will support the renovation of Randolph Tower and help redevelop other underutilized and vacant buildings in the area.

[Click to continue reading
City OK’s Rehab Of Loop Tower, Home For Teen Mothers On West Side – cbs2chicago.com
]

Hey, build for the future, right? Demand for new condos might be low now, but in twenty years…

Via EveryBlock’s hyperlocal news

Footnotes:
  1. tax increment financing []

Bush Interference Seen in Blackwater Inquiry

Criminals and thugs. That is the description future historians will often use to describe members of the Bush Administration.

An official at the United States Embassy in Iraq has told federal prosecutors that he believes that State Department officials sought to block any serious investigation of the 2007 shooting episode in which Blackwater Worldwide security guards were accused of murdering 17 Iraqi civilians, according to court testimony made public on Tuesday.

David Farrington, a State Department security agent in the American Embassy at the time of the shooting in Baghdad’s Nisour Square, told prosecutors that some of his colleagues were handling evidence in a way they hoped would help the Blackwater guards avoid punishment for a crime that drew headlines and raised tensions between American and Iraqi officials.

[Click to continue reading Interference Seen in Blackwater Inquiry – NYTimes.com]

and if you don’t have the mental stamina to click the link1


“Blackwater: The Rise of the World’s Most Powerful Mercenary Army [Revised and Updated]” (Jeremy Scahill)

In a closed-door hearing, they also contended that they had evidence that, in the immediate aftermath of the shootings, there had been a concerted effort to make the case go away, both by Blackwater and by at least some embassy officials.

In fact, prosecutors were told that the embassy had never conducted any significant investigation of any of the numerous shooting episodes in Iraq involving Blackwater before the Nisour Square case, according to the documents.

In his October testimony, Mr. Kohl described how the Justice Department had “serious concerns” about obstruction of justice in the case. He also said prosecutors briefed Kenneth Wainstein, then an assistant attorney general, on evidence of obstruction by Blackwater management.

Mr. Kohl disclosed that prosecutors had discovered that five Blackwater guards who were on the convoy involved in the Nisour Square shootings reported to Blackwater management what they had seen. One guard, he said, described it as “murder in cold blood.” Mr. Kohl said that Blackwater management never reported these statements by the guards to the State Department.

He said that prosecutors informed senior Justice Department officials as early as 2007 that they were investigating whether Blackwater managers “manipulated” the official statements made by the guards to the State Department.

But he testified that prosecutors also had evidence of embassy officials thwarting the inquiry. In addition to the testimony of Mr. Farrington, Mr. Kohl said that United States military officials had told prosecutors that they witnessed State Department investigators “badgering” Iraqi witnesses

and I’d add, scum, to the description of Bushies cited above. Rule of Law, hah. Murderers for hire. Hessians were at least conscripted soldiers, not necessarily believers in the Divine Mission of their masters.

Footnotes:
  1. really, you should []

Blago – Mister Ethics

Blago Jogging on May Street

Oh, that’s rich. And how much is tuition at Northwestern? Something like six figures, I think. It’s fucking golden…

Even if Northwestern University has used the title for a literature course, “The Death of Irony” must be revived for next week’s campus appearance by the former Gov. Rod R. Blagojevich.

Mr. Blagojevich is scheduled to speak at a gathering called “Ethics in Politics: An Evening with Former Governor R. Blagojevich.”

Many people gagged for all the obvious reasons. His alleged misdeeds, cavalier ways, narcissism, favor-swapping pragmatism and seeming belief that he’ll be just fine if he corrals the news media to his side make him an atypical choice for presumably idealistic souls spending a king’s ransom for four years in Evanston.

“But the problem goes deeper,” said Rushworth Kidder, president of the Institute of Global Ethics. “In a sense, he’s the logical and inevitable outcome of a society that has refused to educate the next generation about values, ethics and character. As such, he’s the perfect outcome of our ethical indifference and a role model for the next generation.”

[Click to continue reading Chicago News Cooperative – Now at Northwestern, Ethics 101, Taught by, Well, Go Figure – NYTimes.com]

Blagojevich Country

But there was a contrarian view from Larry Miller, a comic who occasionally writes about politics.

“There are so many shatteringly immoral thieves and cutthroats in government today, yesterday and tomorrow, so many in Chicago and Illinois and New York and Texas and Montana, so many galloping egomaniacs who just haven’t been caught yet, so many roaches zipping around the kitchen floor before someone turns out the light, why not Blagojevich,” said Mr. Miller, who recently appeared in Las Vegas with his chum Jerry Seinfeld.

“You and I don’t want to live like this, but it’s not too cynical to say, ‘They are all like this.’ In theory, O.K., there’s one guy here, and one woman there, who are actually trustworthy. But isn’t it axiomatic that as soon as one of these horrible egomaniacs first decides to run for something, anything, that it’s irrefutable proof-positive the guy’s a complete lunatic and thug?”

His grand finale: “Why not Blagojevich speaking on ethics? At least that has humor. Is it not far worse and creepy to have Hugo Chávez or Ahmadinejad welcome at the United Nations? These are seriously bad people, and we all stand and applaud and nod as if we were about to listen to U Thant,” the former U.N. secretary general.

Food Safety and Tainted Tomatoes

If the Drown-The-Baby-in-the Bathtub Republicans ever get their way1, the federal regulatory infrastructure would get stripped, and there would be a lot more deaths from tainted food. The current system of food inspection is pretty corrupt, but least there is some restraint, and occasionally a corporation will commit such a heinous act that they will get sanctioned. Like SK Foods, and their buddies, Kraft, Safeway, and others:

tomatoes

Robert Watson, a top ingredient buyer for Kraft Foods, needed $20,000 to pay his taxes. So he called a broker for a California tomato processor that for years had been paying him bribes to get its products into Kraft’s plants.

The check would soon be in the mail, the broker promised. “We’ll have to deduct it out of your commissions as we move forward,” he said, using a euphemism for bribes.

Days later, federal agents descended on Kraft’s offices near Chicago and confronted Mr. Watson. He admitted his role in a bribery scheme that has laid bare a startling vein of corruption in the food industry. And because the scheme also involved millions of pounds of tomato products with high levels of mold or other defects, the case has raised serious questions about how well food manufacturers safeguard the quality of their ingredients.

Over the last 14 months, Mr. Watson and three other purchasing managers, at Frito-Lay, Safeway and B&G Foods, have pleaded guilty to taking bribes. Five people connected to one of the nation’s largest tomato processors, SK Foods, have also admitted taking part in the scheme

[Click to continue reading SK Foods at Center of Bribe Scheme to Sell Tainted Tomatoes – NYTimes.com]

The Big Tomato

Food corporations claim innocence, but I assume there was a lot of winkin’ and noddin’ going on, just no hard evidence.

Footnotes:
  1. Grover Norquist, Newt Gingrich, Mitt Romney, and the rest of that group of thugs []

Pawnbrokers Stained by Cohen

I don’t know if I agree with this line of reasoning

Wieners Circle Rages at the Dying of the Light

Illinois is no stranger to odd, larcenous or rough-and-tumble elections. But only here, it seems, has a candidate collapsed so ingloriously that he brought dishonor on what many consider a shame-proof industry: pawnbroking.

The Illinois Democratic Party is not the only statewide organization trying to step out of the cloud that hung over Scott Lee Cohen’s exit as the party’s nominee for lieutenant governor — the Illinois Pawnbrokers Association is trying to save face, too.

Mr. Cohen, the state’s first pawnbroker politician, managed to leave a blot on the ledger of an industry that could do without the extra stain. Mr. Cohen converted instantly from the pride of his industry to a public embarrassment for it when a former prostitute said that he had held a knife to her throat during an argument when the two were dating in 2005.

David Schoeneman, president of the Illinois Pawnbrokers Association and owner of Shane’s-The Pawn Shop in Chicago Heights, this week found himself sharing the same defensive crouch taken by distressed Democratic Party leaders once the abuse accusation surfaced.

“When somebody gets caught being a bad guy, you cringe,” Mr. Schoeneman said. “Same for doctors, lawyers, priests. People are people.”

[Click to continue reading Chicago News Cooperative – The Chicago Way – Ex-Nominee’s Troubles Stain Pawnbrokers – NYTimes.com]

If the actions of one disgraced politician besmirched the entire profession the politician came from, we would have exiled all the lawyers in the country. I think the (former or current, depending) occupation of a politician is less important than that. Political party affiliation is arguably more important to the equation.

Michael Chertoff is Not to be Trusted

Michael Chertoff is Not to be Trusted, part 564

It Pays to Play

WHEN The Times interviewed Michael Chertoff about airport security after the underwear bomber tried to blow up a passenger jet on Christmas Day, he said full-body scanners should be deployed at airports. Chertoff, the former secretary of homeland security, did not volunteer that he is a consultant to a company that makes such equipment, and though they spoke to him twice, reporters never asked if he had a financial stake in the matter.

Chertoff, who championed full-body scanners as head of the Department of Homeland Security, long before he went into private business, said it was no secret that he had become a consultant to corporate clients through the Chertoff Group, a risk-management firm he formed in March. He said that when two Times reporters, Eric Liptonand John Schwartz, called and the subject turned to scanners, it was up to them to ask whether he had ties to that industry. “I always answer when I’m asked,” he said. “But I don’t think it is my obligation to put myself in the head of a reporter” to decide what the reporter needs to know.

Chertoff did tell NPR and CNN interviewers when they asked.

Lipton and Schwartz agreed that they should have asked Chertoff, but both expressed disappointment that he did not volunteer obviously germane information. Bob Steele, a professor at DePauw University and a journalism values scholar at the Poynter Institute, said, “I believe a source does have an affirmative obligation to reveal any competing loyalties, even if the source isn’t sure they create a direct conflict of interest.”

Interestingly, Chertoff wrote an Op-Ed article for The Washington Post, published New Year’s Day, that carried a one-sentence biography divulging that his clients included a scanner manufacturer — a note he said he volunteered. “If I’m affirmatively getting out there,” he said, as opposed to being called by a reporter, “I make it my business to disclose.” That’s a distinction I don’t buy. What difference does it make whether a source seeks a forum or a reporter happens to call? Knowing Washington’s culture of revolving doors and news spin, the Times reporters should have asked the obvious question. But if Chertoff had a connection he thought the public needed to know in one instance, he should have made it clear in the others.

[Click to continue reading The Public Editor – The Sources’ Stake in the News – Op-Ed – NYTimes.com]

How about stop pretending political hacks like Chertoff even have anything relevant to add to the conversation in the first place? Start by assuming they always have a conflict of interest, and that’s why they agreed to be quoted.

The NYT appended the following mushy Editor’s Note below their Chertoff story:

Editors’ Note: January 15, 2010

Articles on Dec. 28, 29 and 30, about the apparent bombing attempt on a flight to Detroit, discussed the use of full-body scanners for airport security. They cited Michael Chertoff, the former secretary of homeland security, as supporting wider use of the scanners. Mr. Chertoff has confirmed in several recent interviews that a manufacturer of the devices is a client of his consulting company. That connection should have been noted in the articles.

Plotters on Wall Street

Frank Rich writes:

Benjamins

But in the 16 months since that other calamity in downtown New York — the crash precipitated by the 9/15 failure of Lehman Brothers — most of us are still ignorant about what Warren Buffett called the “financial weapons of mass destruction” that wrecked our economy. Fluent as we are in Al Qaeda and body scanners, when it comes to synthetic C.D.O.’s and credit-default swaps, not so much.

What we don’t know will hurt us, and quite possibly on a more devastating scale than any Qaeda attack. Americans must be told the full story of how Wall Street gamed and inflated the housing bubble, made out like bandits, and then left millions of households in ruin. Without that reckoning, there will be no public clamor for serious reform of a financial system that was as cunningly breached as airline security at the Amsterdam airport. And without reform, another massive attack on our economic security is guaranteed. Now that it can count on government bailouts, Wall Street has more incentive than ever to pump up its risks — secure that it can keep the bonanzas while we get stuck with the losses.

[Click to continue reading Frank Rich – The Other Plot to Wreck America – NYTimes.com]

Continuing to Talk

In an ideal world, the corporate media would be investigating this crime wave as breathlessly as they hyped the underpants bomber or the Balloon Boy. Why aren’t they? Collusion? Lack of intelligence? Lack of trust that viewers can understand complex issues? All of the above? The US Congress is so wimpy that they won’t consider investigations with teeth unless public outcry reaches deafening crescendos, and the public is only silently weeping at the moment. I doubt there are any public officials with the intestinal fortitude of Ferdinand Pecora in today’s Washington.

The last time Washington enacted sweeping financial reform, more than 75 years ago, the catalyst was a cigar-smoking, Sicilian-born immigrant named Ferdinand Pecora.

A former New York prosecutor, Pecora was the last in a series of investigators hired to examine the causes that led to the stock market crash of 1929 for the Senate Committee on Banking and Currency. In early 1933, the newly-elected Democratic president, Franklin D. Roosevelt, gave the bulldog lawyer his blessing to dig deep into the excesses that had plunged the nation into the Great Depression.

The result was a relentless investigation, 12,000 pages of transcripts that laid bare abuses on Wall Street and failures of Washington to adequately regulate the nation’s financial system. Pecora’s efforts provided a basis for reforms that would alter Wall Street and maintain relative stability in the banking industry until the recent crisis. These included legislation that for the first time regulated the sale of securities and helped establish the Federal Deposit Insurance Corp. and the Securities and Exchange Commission.

For all the differences between then and now, there also are whispers of familiarity: Abuses on Wall Street. The blind eye of Washington. An economy in crisis. A new and eager administration calling for reform, and efforts by those with v

[Click to continue reading Ferdinand Pecora Ushered In Wall Street Regulation After 1929 Crash – washingtonpost.com]

Gale Norton Lurves the Environment

In fact, the former Secretary of the Interior loves nature so much, she joined up with Royal Dutch Shell. A cynic might ask what Ms. Norton did for Shell while serving as Secretary from 2001-2006, but a realist could readily answer: anything Shell wanted. I mean, any thing. Ms. Norton apparently learned a lot by being an assistant to Regan era Interior Department under James Watt.

Ex-Interior Secretary Norton Is Hired as Counsel for Shell – WSJ.com

Royal Dutch Shell PLC said it hired former U.S. Interior Secretary Gale Norton to serve as a counsel for the Anglo-Dutch oil company.

The move comes amid rising scrutiny in Washington of the department’s dealings with the oil industry.

The hiring of Ms. Norton comes at a tough time for her former agency. With the Democratic takeover of Congress, leading lawmakers have signaled they will closely scrutinize the Interior Department’s policies for collecting oil-and-gas royalties from public lands.

The Minerals Management Service has come under particular criticism after agency omissions excused the oil industry from paying royalties on Gulf of Mexico leases from 1998 and 1999. A Government Accountability Office report said the omission by the MMS cost taxpayers $10 billion.

Shell, historically one of the biggest industry players in the Gulf of Mexico, was one of five oil companies that reached an agreement with the MMS Dec. 14 to pay royalties on the 1998 and 1999 leases.

She does have prior experience screwing the environment…

Before being named Interior Secretary in 2001, Norton was senior counsel at Brownstein, Hyatt & Farber, P.C., a Denver-based law firm. The firm was listed with the U.S. Congress as a lobbyist for NL Industries, formerly known as National Lead Company.

also, at the occasion of her stepping down to spend more time with Jack Abramoff’s family of criminals, the Sierra Club issued this press release:

As Interior Secretary, Gale Norton was an unpopular symbol of unpopular policies. Americans do not believe their public lands should be sold to the highest bidder, and they don’t believe in privatizing their parks, forests, monuments. While the symbol of those unpopular policies may be leaving, we don’t expect those unpopular policies to change.

Unless the Bush administration reverses direction, her replacement will merely be a different fox guarding the hen house. Considering that the administration is currently lobbying to open the Arctic National Wildlife Refuge and our coasts to destructive drilling, it’s hard to imagine that the next Interior Secretary will be allowed to promote smart energy solutions that protect sensitive lands, waters and wildlife habitat.

“Having previously represented oil, mining, and timber companies in her private life, Norton consistently gave those gave those interests special treatment while pulling agencies she oversaw away from their role as stewards of the land. Her policies were opposed by ranchers, hunters, anglers and other conservationists and the faith community.

”Thankfully, significant pieces of her agenda were blocked by Congress, courts, and by public outrage. For example her attempts to open the Arctic Refuge to drilling were repeatedly rejected by Congress and the American people.

and don’t forget:

an example of a nonbribe for which the Honorable Dennis Hastert, Speaker of the House of Representatives, will not spend one hour in jail. The Chicago Tribune reported this week that on June 3, 2003, Hastert held a fundraising event at Signatures restaurant, the deluxe Washington watering hole that Jack Abramoff appears to have run at a loss to corrupt federal officials.

At Hastert’s bash, Abramoff, who picked up the cost of the affair, also donated $20,000. One week later the Honorable Hastert sent Interior Secretary Gale Norton a letter asking her to go along with one of Abramoff’s Indian casino gambling schemes. Money changed hands, favors were done. But this is not a bribe, this is legal, this is OK. This stinks, and there is no law against it.

Robert Kennedy Jr. writes:

In October 2001 Interior Secretary Gale Norton, responding to a Senate committee inquiry on the effects of oil drilling on caribou in the Arctic National Wildlife Refuge, falsely claimed that the caribou would not be affected, because they calve outside the area targeted for drilling. She later explained that she somehow substituted “outside” for “inside.” She also substituted findings from a study financed by an oil company for some of the ones that the Fish and Wildlife Service had prepared for her.

In another case, according to the Wall Street Journal, Norton and White House political adviser Karl Rove pressed for changes that would allow diversion of substantial amounts of water from the Klamath River to benefit local supporters and agribusiness contributors. Some 34,000 endangered salmon were killed after National Marine Fisheries scientists altered their findings on the amount of water the salmon required. Environmentalists describe it as the largest fish kill in the history of the West.

Mike Kelly, the fisheries biologist on the Klamath who drafted the biological opinion, told me that under the current plan coho salmon are probably headed for extinction. According to Kelly, “The morale is very low among scientists here. We are under pressure to get the right results. This Administration is putting the species at risk for political gain. And not just in the Klamath.”

Roger Kennedy, former director of the National Park Service, told me that the alteration and deletion of scientific information is now standard procedure at Interior. “It’s hard to decide what is more demoralizing about the Administration’s politicization of the scientific process,” he said, “its disdain for professional scientists working for our government or its willingness to deceive the American public.”

I could go on, but you get the general idea. Too bad the modern Republican party doesn’t believe in conservative values anymore, you know, like conservation of our planet.

OK, one more tidbit, from Eyal Press:

At the heart of the controversy lies a drilling method known as coal-bed methane extraction, a technique pioneered in the late 1980s that enables companies to suck natural gas out of the coal seams that lie buried beneath the San Juan Basin and other formations. Beginning under the Clinton Administration, the federal government pushed to expand production of this comparatively clean-burning fossil fuel, although Clinton also protected millions of acres of public land from drilling. The Bush Administration, by contrast, has called for removing all “restrictions and impediments” on domestic development, code language for opening dozens of pristine natural habitats to unfettered leasing.

…But the Blancetts, like many Western ranchers, are not taking the Bush Administration’s policies lying down. Earlier this year, after the Interior Department’s Bureau of Land Management (BLM) issued a Resource Management Plan authorizing the creation of nearly 10,000 new oil and gas wells on public land in the San Juan Basin–where an estimated 19,000 producing wells already exist–Tweeti filed suit against Gale Norton and the Interior Department, accusing the government of failing to balance resource extraction with conservation, recreation and other uses of federal land. Among the other plaintiffs in the suit are the Natural Resources Defense Council, several Navajo Indian chapters–who say they were never consulted about the drilling plans–and the San Juan Citizens Alliance, a watchdog group based in nearby Durango, Colorado.

None of the plaintiffs claim that extracting coal-bed methane gas, which is used to heat millions of American homes each year, is an inappropriate use of public land. But under federal law, they note, the BLM is supposed to balance this objective with the interests of other users (hunters, ranchers) and insure that drilling is done in a way that does not wreak havoc on a precious public resource of value to all. “The federal lands that we have in the West are all of our heritage, all of our legacy,” says Tweeti Blancett, a feisty woman who has turned this issue into a personal crusade, and who is convinced the entire Rocky Mountain West will soon look like her ranch if landowners don’t fight back. “What’s happened here will happen throughout the American West if we don’t get the public to understand the issues.”

Coming from, say, a member of the Sierra Club, such a statement might not be terribly surprising–and would likely be ignored by Republicans, who long ago conceded the vote of avid environmentalists to Democrats. But Tweeti is no card-carrying Green. Four years ago, she not only voted for George W. Bush but served as the co-chair of his campaign in San Juan County, an area of New Mexico that is heavily Republican and crucial to the President’s hopes of winning this hotly contested swing state in November.

These days, she says, members of the Bush Administration don’t even return her calls. “What I didn’t factor in is the dollar sign, the billions,” she concludes. “They were not going to listen to me over the largest industry on the face of the earth and the billions of dollars they generate.”

Stadium Boondoggles ruining more cities


“Major League Losers: The Real Cost Of Sports And Who’s Paying For It” (Mark S. Rosentraub)

Cities are being forced to gut budgets for non-essential items like schools, police, road repair and so on in order to fund impoverished sports franchises, and the sweetheart stadium deals the sports teams negotiated. Or something.

LBJ Library Sky

Years after a wave of construction brought publicly financed stadiums costing billions of dollars to cities across the country, taxpayers are once again being asked to reach into their pockets.

From New Jersey to Ohio to Arizona, the stadiums were sold as a key to redevelopment and as the only way to retain sports franchises. But the deals that were used to persuade taxpayers to finance their construction have in many cases backfired, the result of overly optimistic revenue assumptions and the recession.

In Indianapolis, the Capital Improvement Board spent 2009 trying to find $32 million to run the Lucas Oil Stadium and convention center. In Milwaukee, a drop in sales tax receipts may delay by several years the date for paying off the bonds issued to build Miller Park, the home of the Brewers.

Columbus, Ohio, is considering using public money to keep the Blue Jackets in town. Glendale, Ariz., has fought to hold the Phoenix Coyotes to their long-term lease. In New Jersey, a ticket surcharge may be added to help resolve a tenant-landlord dispute between the Devils and Newark.

Mark Rosentraub, the author of the book “Major League Losers,” said that many of the stadium deals included “revenue bombs,” with financial traps like balloon payments on debt in later years and sweeteners like the Hamilton County property tax rebate to win public support.

In many cases, the architects of the deals are long gone by the time the bill comes due.

The plan went awry almost from the start. The [Cincinnati Bengal’s ] football stadium exceeded its budget by $50 million, forcing the county to issue more bonds. Forecasts for growth in the sales tax turned out to be too rosy. The teams received sweetheart leases. In 2000, voters threw out the county commissioners who cut the deal.

That year the sales tax grew 1.8 percent, the first of many years below the 3 percent forecast. Both stadiums were originally expected to cost $500 million combined. Yet Paul Brown Stadium alone cost $455 million and the Great American Ballpark, the Reds’ home a few hundred yards down the Ohio River, cost $337 million by the time it opened in 2003.

The generous deal for the Bengals has been a sore spot. The team had to pay rent only through 2009 on its 26-year lease, and has to cover the cost of running the stadium only for game days. Starting in 2017, the county will reimburse the team for these costs, too. The county will pay $8.5 million this year to keep the stadium going.

The Bengals keep revenue from naming rights, advertising, tickets, suites and most parking. If the county wants to recoup money by taxing tickets, concessions or parking, it needs the team’s approval.

[Click to continue reading As Revenue Plunges, Stadium Boom Adds to Municipal Woes – NYTimes.com]

Sunset at Safeco Field

Was it really worth it? Are public spectacles so important to our society that paying wealthy team owners to host their games is more important than funding all else? If owners of sport teams are so broke they need welfare to pay for their team’s stadium, perhaps they should sell the team to someone who can pay the team expenses without taxpayer dollars. The sporting stadium boondoggle is one of the worst kinds of corporate welfare in the nation.