August 17, 2003: Well well well well well well well.
So now the electricity troubles are in the east. It's early yet to
get a clear picture of what caused this giant blackout, reminiscent of
the legendary 1965 monster that was supposed to never happen again... but
one thing that's being said is that it has a lot to do with underinvestment
in transmission lines, which get short shrift because apparently the utilities
see them as all expense and no profit. Now, during the California
crisis, inadequate transmission lines came in for some of the blame (among
those not willing to say that generators were holding back production),
but what actually happened was that the market manipulation games that
drove the prices up created an artificially high demand for transmission
line capacity, and despite the overuse of the large trunk lines, the system
held up and kept working, even when one major north-south line failed.
So despite all the sneering that certain Easterners did about granola-eating
California hippie tree-huggers being unwilling to build power plants, it
turns out our power system is better put together than the one in the east
One thing that happened in the crisis here, by the way,
is that the state bought some of the big transmission lines from PG&E.
Time will tell whether the utility or the government takes better care
In the California recall election, the Republicans are
not, after all, all piling in behind Ahnuld. Bill Simon Jr., the
loser of the last real election, is running against Schwarzenegger and
intends to strongly emphasize the difference between their policy positions
-- namely, the difference that Simon has one. He says he's grateful
that Arnold is in the race, despite the two of them going after the same
pool of votes. Davis's popularity numbers are now even lower than
before the race started, and some Democrats are starting to think in terms
of unifying behind Lt. Gov. Cruz Bustamante instead of doing the right
thing and trying to get people to vote no on the pointless recall.
One thing Davis should do is call for debates early and
often. Most of the reasons he's unpopular are general unthinking
resentments over things going badly, for reasons which are not the
Governor's fault. The more he and other Dems can talk out the actual
issues and challenge their opponents for defensible alternatives, the more
the public is likely to see how unpromising the recall is. And if
Davis can actually get Ahnuld up on a debate stage, of course, the likelihood
is that the vacuity of the "pump up Sacramento" campaign is going to be
all too apparent... which means Schwarzenegger probably won't do it, at
which point Davis can gleefully rub it in that the tough guy is scared
to debate him on real issues. (Not that Davis is capable of doing
anything in a visibly gleeful manner, but whatever.)
Unfortunately, Davis is going with a "rose garden" strategy
of staying above the fight and just doing his job. Dumbshit.
My own prediction, from the start, has been that despite
Schwarzenneger being annointed by the media as the front-runner in the
race (I just heard a Fox News guy call the race "his to lose"... and it
should be noted that the state's newspapers have been generally hostile
to Davis and Bustamante), he is not going to win, because the populace
truly is not dumb enough to vote for someone that unqualified. My
friends think I'm being foolishly optimistic and uncynical about my fellow
citizens. I agree with Bill Simon (though the media isn't giving
this any credence yet) that he could well be a more important challenger
than Arnold. Which is good for Davis, because election rematches
are almost never upsets, the guy who lost the first one can be relied on
to do even worse the second time.
[UPDATE] Whoa, stop the presses -- the morning after
I first uploaded this page, suddenly the news comes out that Cruz Bustamante
has pulled ahead of Schwarzenegger in polls by three percent. And
as a result, there's immediate talk that all other Republicans in the race,
including Peter Ueberroth and Tom McClintock as well as Bill Simon, are
going to be leaned on by the state party to step aside. Simon says
nobody has tried yet to push him out of the way. Bustamante, by the
way, has come out swinging, saying that Davis's staff has tried to undermine
him, despite his official position being that people should vote no on
the recall, and vote for him only if they won't do that. Davis's
people deny it. Democrats have also alleged that President Bush is
quietly involved in the election behind the scenes.
No candidate except Bustamante has yet suggested a way
to handle the current budget crisis any better than Davis did. Bustamante
is biting the bullet and calling for some raised taxes, as well as cuts.
Schwarzenegger has avoided saying anything specific at all on the issue.
His sole campaign promises so far are ones that would increase spending.
The most bogus aspect of the whole recall is that if Davis
gets 49% of the vote, and Schwarzenegger gets 12%, Bustamante gets 11%,
Simon gets 10%, and the small fry divide another 18%, then Schwarzenegger
wins, despite Davis getting four times as many votes. This is way
worse than anything you can say about the Electoral
College. And if voting to keep Davis precludes you from voting
for Bustamante (I'm not certain this is the case, but I would expect so),
then Bustamante is likely to get fewer votes even if he has more supporters.
So my prediction that Ahnuld will lose may well go the same way as my 2000
prediction that Albert Gore would win the presidency: it might be right
as far as who has the support of the majority of voters, but wrong as to
who ends up in office. This is certainly a good reason why the State
Supreme Court should seriously consider the case to make the recall vote
a simple yes/no, with the selection of the new governor happening separately,
like in the March primary election. That way, the winner is the one
who is favored by the most voters; this way, it's not.
This recall is so toxic that even my local alt-weekly
newspaper, which is normally quite respected and reputable, has come out
looking like a bunch of dickheads. Last week's issue had Gary Coleman,
the diminutive former TV star, on the cover. Gary, they announced,
was running for governor! They reported breathlessly on Coleman's
platform, which was one random absurd piece of thoughtlessness after another.
For instance, Coleman wants to get rid of buses because they slow down
cars. But then it turned out that the paper had put together Coleman's
campaign itself -- they wanted to make the whole thing look as silly as
possible, so, in essence, they hired a washed-up actor to make a fool of
himself and be laughed at, hoping that the derision he pulled down on his
own head would rub off on the recall election itself. From a personal
ethics standpoint, this stunt leaves a lot to be desired... and from a
political standpoint, isn't this the sort of thing we would expect from
some right-wing kingmaker mogul like Rupert Murdoch or somebody?
Well, Coleman showed them. The day the paper came
out, he endorsed Schwarzenegger.
By the way, isn't it funny how a few months ago, all the
right wing media shouting heads were telling Hollywood celebrities to stay
the hell out of politics? Now they all think Ahnuld is the hero who
will save the state. (How, by contributing his movie revenues to
There is one good thing about the Schwarzenegger campaign.
It has to do with property taxes. For twenty-five years, the elephant
in the living room of California politics has been the fact that we completely
fucked ourselves revenue-wise by passing that classic opening salvo of
the eighties anti-tax revolution, the Jarvis-Gann Initiative, a.k.a. Proposition
13. That one maneuver is at the core of most every problem the state
has developed with budgetary matters. What it was, for those not
familiar with it (and the many who think you are) was a cut in property
taxes, combined with a measure to stop property tax assessments from keeping
up with the growth of inflation as long as the property stays under the
same ownership. The second part of this, not the first, is where
the problem comes in. You see, the long term result is that tax revenue
isn't just cut once, but keeps on shrinking and shrinking. Also,
as I pointed out the time (though I was hardly out of high school then)
and almost nobody else paid any attention to back then, the taxes paid
by different people and different corporations get farther and farther
apart, until you practically have no two people on the block paying the
same tax rate... and this difference in rates tends to favor the advantaged,
and to favor large corporations over small companies and individuals, because
an outfit like IBM or Chevron or Lockheed Martin is far more likely to
hold the same large plot of land for sixty years than a homeowner is, especially
a less well off homeowner. Prop 13 was the first of the great eighties-style
grabs of extra privilege for the already privileged, the opening salvo
of the modern class war. (If you can call it a war when the other
side isn't fighting back worth a damn.) As befit a tentative opening
shot, it was a subtle and indirect bit of assistance to the rich, not nearly
as nakedly greedy as the stuff they pulled later. (Like, for instance,
last year.) Anyway, for twenty-five years the great unspoken secret
in California politics has been that we need to undo Prop 13, because it's
the core of all the reasons why we have problems such as schools that used
to be among the top few states in quality and are now among the bottom
few. My great fear is that our abandonment of decent education is
eventually going to cause the state to abandon all its wealth and prosperity,
which has mainly arisen from our rich crop of bright creative minds, and
we'll end up as poor as Mississippi. And nobody has dared to make
a peep about this all-important issue, because the anti-tax faction has
got every living politician buffaloed and terrified.
But finally somebody came out today and said the unspeakable:
we are not making enough property tax revenue and we should raise property
taxes back to a higher level. Who said it? A top adviser of
the Schwarzenegger campaign! Not just any random political flack
either: this was Warren Buffett, the billionaire Wall Street financier.
Buffett gave as an example
two houses he owns himself, one in Nebraska and one here: the tax rate
on the former is about 2.9 percent per year, but on the latter he's paying
only around 0.05 percent! Even I didn't know it had gotten that bad.
When even a billionaire thinks taxes are too low, that's saying something.
(Billionaires traditionally don't like taxes, because under any sensible
system they pay the most while getting less value for their dollar than
non-billionaires. Hence, like magic, we get a great big "popular"
anti-tax movement... and Dubya selling tax cuts even when the public isn't
wanting one. You think the people behind Dubya believe that
supply-side shit? Or that cuts will create millions of jobs?
There are indeed some advantages to political outsiders,
no matter how ill-prepared they are.
After my long period without updates, there are still
far too many corruption-related stories to cover. I'll once again
go for the abbreviated bullet list. But I have to discuss one corruption
item related to Iraq.
You've no doubt heard some moderate stink about how Halliburton
(Dick Cheney's old company) got all the lucrative contracts in Iraq --
both for rebuilding the infrastructre (mostly the oil infrastructure, that
is), and through its Kellogg Brown & Root subsidiary, for logistical
support of the troops themselves. Well, that story just got twice
as good... no, three times as good. You see, there wasn't really
much evidence that the government was particularly playing favorites with
Halliburton, it could just be a matter connecting two dots that look close
but aren't linked... until now: the Bechtel Group, a company with a long
history of enjoying a favorably close relationship with Washington when
it comes to bidding on assorted contract jobs, is now complaining
that the bidding process for Iraq is so tilted towards Halliburton that
there's no point in them even competing for contracts any more. That
pretty much tells you how bad it is. I mean, this is not an
outfit that would want that kind of issue raised under ordinary circumstances.
In fact, for the oil contract, the Army eventually just shut down the open
bidding process altogether, to make sure Halliburton got the job.
But if you think that's bad, here's the really awful part:
it turns out that the Brown&Root people who are supposed to be supporting
the troops aren't doing their jobs! Increasingly, their people
have simply been unwilling to go into the areas where the soldiers have
no choice but to go, due to the possible dangers to life and limb.
So we are paying hundreds of millions for these clowns to do nothing,
while the young people who put their asses on the line for freedom and
democracy (at least, they hope that's what it's for) are left with no fresh
food or no toilet paper or no mail or no landing strip for the aircraft
that's supposed to be coming in tomorrow, or no shelter. They end
in squalor because the modular buildings they were supposed to live
in went undelivered. They end up begging their families or visiting
reporters for such things as a box of nails to hold a wall up. This
shift to civilian support contracts is part of Donald Rumsfeld's campaign
to modernize the military so it's "more agile".
Oh, and it turns out that the oil rebuilding part is somehow
going to cost twice as much as they expected it to. In spite of Executive
Order 13303, which essentially protects any company involved in the
Iraq rebuilding effort from any legal liability over anything, no matter
how guilty they are. You'd think they would know how to estimate
the costs of rebuilding Iraq's oil equipment, since they already got hired
for it once, after the last time Dick Cheney bombed the country into submission.
(And at which time, I'll remind you, doing business with Iraq was illegal.
No problem for them, all they need is an overseas front.)
A whistleblower has come out of the Pentagon, by the way,
who points the finger straight at Donald Rumsfeld for all of the many sordid
episodes coming out of, or leading into, the war in Iraq, including the
misuse of intelligence reports to make Iraq sound like a threat: recently
retired Air Force Lt. Col. Karen Kwiatkowski, a specialist in Middle East
affairs. She says
that what she saw from the inside was "a subversion of constitutional limits
on executive power and a co-optation through deceit of a large segment
of the Congress." Said Congress is likely to be very interested in
her testimony next month.
Let us not forget that it was none other than Rumsfeld
who helped arm not one but two members of the Axis of Evil, in the
old days before we realized they were the bad guys. Iraq in the eighties,
and North Korea just three years ago, when a company called ABB, with Rumsfeld
on its board, contracted to build two nuclear reactors there.
Now, a spray of bullets. Eat lead, yankee dog!
I mean, eat phosphorus. No wait, maybe I mean eat liquid crystals.
Here we turn toward state and local government matters:
A piece of good news about a story we were covering in the
past. Sure enough, Michael Powell's FCC board passed new rules allowing
greater centralized media ownership, so we can have even more synthetic
unanimity, despite over 90% of the public being against it. But huge
letter-writing campaigns and so on were effective enough that Congress
took up the issue and looks ready to overrule the worst parts of Powell's
new rules. The House has done so, the Senate is expected to follow,
in spite of Dubya threatening a veto. Even Trent Lott is siding against
Powell. Now Powell, like his father, is being targeted with that
favorite little bit of Washington backstabbing: the leaked rumor of impending
(What is it with the damn GOP and their nepotism, anyway?
You don't see one tenth as many kids of democrats getting into prominent
jobs grooming them to replace their parents. If you read Blinded
By The Right, one thing that constantly sticks out is phrases like
"Xxx, son of the well-known Xx" -- half the major characters in there are
some famous older conservative's kids.)
Speaking of centralized media ownership, when DJ Roxanne
Cordonier of WMYI made no secret of her anti-war beliefs on the air, Clear
Channel Communications (owner of 1200 radio stations) fired her ass.
(Did you know that even in the Bay Area, probably the most
liberal metropolitan region in America, throughout many parts of which
no Republican ever has a chance in hell to get elected to anything... even
here, the AM radio dial is packed with shouting right-wingers, with hardly
a liberal in sight? The left is scarcely visible except on noncommercial
stations. You really think the media is organized by just giving
people what they want?)
Clear Channel sponsored pro-war rallies too. And by
the way, such rallies in the New York State area were mostly run by a guy
named Don Neddo, who stirred crowds with his tales of serving in Korea,
how he parachuted behind enemy lines and suffered frostbite. Which,
it turns out, he didn't do. Not any of it.
How did Argentina get its finances so thoroughly hosed?
Well, the IMF was no help, but it turns out they were helped along into
bankruptcy by U.S. financial houses. Big names on Wall Street all
touted Argentina as a great place to lend money, because the economy there
was hot stuff. In other words, they puffed it up like Enron in order
to collect a cut of the money being sent down there, and to sell Argentinian
stocks and bonds at inflated prices. When Argentina came close to
failure, the banks engineered a big complicated "debt swap" which didn't
help, but did collect $100,000,000 in transaction fees. Soon after,
the investors lost their asses, and the Argentinians practically lost their
entire economy. Barclays Capital is one bank that is 'fessing up.
Other guilty houses include Goldman Sachs, Morgan Stanley, Credit Suisse,
J.P. Morgan, Merrill Lynch... pretty much the entire Wall Street crowd
with the one exception of Desmond Lachman at Salomon Smith Barney, which
is part of Citigroup... which did not publicize his concerns.
an article about major banks indulging in Enronesque tax avoidance games,
by creating fake investment funds with no outside investors. Almost
all of these funds were set up with advice from KPMG, the top competitor
to Andersen/Accenture in the crooked accounting business. Much of
the pressure to shut these funds down came from (yay) officials of the
California state government. KPMG, which now likes to call itself
"BearingPoint", recently had a huge drop in stock price, by the way.
And there's a fresh bit of news about Enron itself from the
bankruptcy court: they're finding that Arthur Andersen was not as involved
in some of the shady dealing as previously supposed, that Enron's banks
were taking on the dirty work and concealing it from Andersen. The
main offenders are, of course, Citigroup and JP Morgan Chase. They've
already settled their case with the SEC for a combined $255,000,000, plus
another $25,000,000 to the city and state of New York. Other banks
involved were Barclays, BT/Deutsche, CIBC, and Merrill Lynch. All
of these banks are attempting to recover some assets from Enron that they
say they are owed... this evidence means the court may well send them home
with nothing. Barclays denied any hint of wrongdoing. (The
same company that, when admitting to bullshitting investors about Argentina,
compared it to the inflation of Enron.) CIBC also denied. BT/Deutsche
has said nothing either way.
The Treasury department has released documents -- after being
poked with the Freedom of Information Act -- that show
that Enron "regularly and aggressively" got government officials to lean
on officials in half a dozen foreign countries who were not giving them
what they wanted. We already knew of one gross example of Dick Cheney
himself leaning on officials in India to pay money to Enron... now we are
learning how common and frequent this pattern was, of government officials
doing Enron's work instead of their own jobs. Consumer groups who
have gone through the documents (or at least the uncensored parts) say
that Enron just had that magic touch for taking this sort of sleaze further
than any of their competitors did... which is to say that other companies
were doing the same thing, they were just less extreme and brazen about
it. Other officials besides Cheney who got involved in this included
Paul O'Neill at Treasury, and members of the National Security Council.
Thanks to U.S. intermediaries, even the World Bank ended up doing Enron's
bidding. U.S. officials helped Enron's water company, Azurix, squeeze
money out of Argentina, thereby doing their part to help bring the country
Has the recent spate of big embarrassing business scandals
done anything to curb the corporate culture of rewarding CEOs of failing
companies with enormous personal compensation? Uh, no.
Oh, a subsidiary of Halliburton has confessed
to bribery in Nigeria.
The FBI reports that they are opening three to five investigations
a month into cases of corporate fraud of $100,000,000 or more. If
you thought the corporate scandal situation had settled down or been cleaned
up since two years ago, you're mistaken.
It isn't just conspiracy theorists any more who are raising
a fuss over the trustworthiness of the new electronic voting machines.
After an academic team of security experts analyzed the source code for
Diebold's voting machines (which they weren't supposed to have access to,
but did) and found numerous vulnerabilities that could allow an outside
hacker to affect election results, a meeting of the National Association
of Secretaries of State hurriedly agreed to look into ways to give these
systems much more stringent scrutiny. Several individual states,
such as Virginia, Maryland, and North Dakota, are backing away from deals
with Diebold. The head of the investigating team made the same recommendation
I discussed last week, by the way: a verifiable paper record that is seen
by the voter, perhaps behind glass.
Oh, this is just great. The Bush administration
is moving toward approving
the testing of toxic and noxious chemicals on human beings, which was banned
(at least for studies accepted by the government for new pesticides and
so on) in 1998.
The Bush energy bill is back, still not passed after kicking
around for more than two years. It may have mutated a lot since Ken
Lay of Enron first told Bush what to put in it... but it still includes
an effort towards hydrogen powered cars for politicians to pose in front
of (but with all the hydrogen extraction effort currently going to fossil
fuel outfits, ensuring that no ecological benefits will arise in the shorter
term), but it also includes enormous incentives to reestablish a thriving
US nuclear power plant industry. Because the Bushies know, you see,
that oil is going to dry up soon, whether they admit it in public or not.
They aren't willing to invest in anything green, so their answer is nuclear
power plants. Now nobody with any sense wants to be in the nuclear
power business because it's so financially risky, so Bush is sweetening
the pot: huge subsidies, and a guarantee of legal protection in the event
of a catastrophic accident that, say, wipes out a city... a guarantee that
could end up costing taxpayers as much as a war if anything bad happens.
The package is so generous that even some pro-nuclear advocates are calling
it excessive and unfair to other power technologies. Even with all
this, it's even money that power companies still won't want to build the
plants... far better, economically, to let the other guy build
them, and keep burning oil, raising your prices to nuclear power levels
in order to afford the rising cost of crude.
No matter how much it's changed since the Ken Lay days, the
current version of the energy bill still contains language empowering utilities
to create lots of confusion in their accounting, through subsidies and
so on. According to the Sierra
Club, it's still set up to allow more states to be ripped off as California
Speaking of nuclearity, I bet you didn't hear about the Department
of Energy resuming production of plutonium cores for nuclear warheads...
now that will sure encourage the North Koreans to take us seriously
when we tell them they're all wrong for making bombs of their own.
Going all the way back to the beginning of March, I should
let you know what happened to the General Accounting Office's lawsuit that
was trying to get Dick Cheney to hand over the records of his energy policy
commission, so the nation could see whether they really did or did not
have Ken Lay write the energy bill. Well, the Comptroller General,
David Walker, dropped the suit. Why did he do that -- because he
didn't have a case? Because his suspicions turned out to be unfounded?
No, because an unidentified congressman in the White House's pocket told
him that the GAO's budget would be gutted if he didn't back off.
Walker also complained that U.S. District Judge John Bates, in making rulings
on the suit, had "made up" some of his findings of fact. Bates is
a Bush appointee to the bench who donated money to Bush's election, and
whose former job was assisting Kenneth Starr in sniffing Bill Clinton's
Meanwhile, the joint lawsuit of the Sierra Club and Judicial
Watch continues to drag on in the process of forcing Dick Cheney and the
Department of Energy to cough up those same records. The White House
at every step of the legal process, but they make sure each step takes
months and months. All past court orders have been that they turn
over the documents already, but they are still managing to stall.
The Bush administration told their top Medicare accountant
to write a report about the impact of bringing private managed care into
the system, as Bush wants to do. The report's findings were not favorable.
So naturally, the White House suppressed it. Tom Scully, the chief
of Medicare, threatened to fire anyone who released the numbers.
Once again, the administration has also decided not to release
to the public their own findings about global warming. This is becoming
an annual event. Almost a tradition.
Oh, and just before Treasury Secretary Paul O'Neill was given
the hook, he asked for a report on the future of the budget deficit.
The report concluded, naturally, that we're fucked. Which we didn't
need any expert to tell us, of course. It says that the retirements
of baby boomers could be in very bad trouble. Add this report to
the list of those the White House has decided to keep quiet... all mention
of it being excluded from the Annual Budget Report, for instance.
Because this happened right at the time that Bush was trying to pass his
second tax cut. (Which passed only with a tiebreaking vote from Cheney.)
Here's a bad
one: the Class Action Fairness Act, a tort reform bill that is designed
to cut back on consumer class action suits. The key part of it is
a federal takeover of what otherwise would be state and local cases.
A pair of congressmen, one from each party, put out a bill
corporate obligations toward their employee pension funds, through
a totally arbitrary accounting trick that makes their contribution count
as enough though less money is being put in. The Portman-Cardin "Pension
Preservation and Savings Expansion Act” is trundling along through the
ol' congressional law-grinder. Big corporations are all for it.
Senator Larry Craig of Idaho decided to block the promotions
of 850 Air Force officers, including those who served bravely in recent
combat. Why? Because he's trying to force the Pentagon to station
four cargo planes at an Idaho Air National Guard base, and they didn't
want to. Way to go on supporting our troops, you childish putz.
Good old Pat Robertson called for a 21 day "prayer offensive"
to ask God to, ah, remove some liberal Supreme Court justices. He
also strongly supported Charles Taylor, the president of Liberia, before
he finally gave up and left office, on the grounds that however evil and
Saddam-like he might have been, he was Christian and his opponents were
more Muslim. Or is it because Robertson invested $8,000,000 in a
Liberian gold mine four years ago, with Taylor's help?
Oh, and back in April Pat Robertson found a cryptic bible
verse which, according to him, means we should bomb the crap out of Syria.
And in March, Regent University (founded by Robertson) kicked out a student
for developing a facial tic. The student, Herbert Chadbourne, thought
it might be due to exposure to some toxin while serving in the first Gulf
War, but his fellow students at Regent thought it was more likely that
he was possessed by demons, and "expressed concern" until he was
booted out. He sued.
We've mentioned Mitch McConnell as the senator who was most
vigorously trying to gut the McCain-Feingold campaign finance reform law.
His daughter Claire recently ended up in the news: she's an elementary
school teacher, and she got in trouble when parents discovered that she
liked to discipline children by tying their hands, strapping them to their
chairs, and putting tape over their mouths. What kind of hellhole
did you raise your daughter in, Senator? (I guess Dan Quayle said
it best: "Republicans understand the importance of bondage between a mother
The latest company accused of fraudulent accounting: Coca-Cola.
Is nothing sacred? Feds are investigating.
AOL has been hit too, with insider trading stock inflation
Worse than that, here's some greedy book-cooking that isn't
even at a private company: the president of Freddie Mac, a federal home
mortgage outfit like Fannie Mae, refused to cooperate with an internal
accounting probe, and so when they found crooked dealings, he got booted
out along with two other sleazebags. Now prosecutors and the SEC
are digging into the organization, to see if there are more bad apples.
And with that, I proclaim myself as done as I'll ever be
with covering the stories I missed during the six month gap in Enron
& Friends production. Now, on to new breaking stories.
Some good news in California: State Senator Jackie Speier
is no stranger to having her bills shot down by lobbyists of various industries.
She sponsored an anti-spam bill, for instance, which pro-spamming interests
got Governor Davis to undercut. (It's crap like this that makes even
the most ardent anti-recall people, like me, shy away from actually claiming
that Davis is a good governor.) Well, for four years Speier has been
trying to pass a bill forbidding banks and so on from selling their customers'
personal information for profit without permission. The industry
kept the bill completely blocked. But since this is one of those
things where the only interest group in favor of it is the voters, somebody
started collecting signatures for a ballot initiative. Suddenly the
industry backed down and stopped fighting. Speier is trying to get
it through the Assembly by Wednesday, or the initiative will go ahead,
and some Assembly people are still dragging their feet, so she says it'll
be tough to make it in time.
Jeb Bush® wants to put caps on pain-and-suffering awards
in medical malpractice suits, and says that doctors are being driven out
of Florida by high awards in such cases. Except, woops, testimony
before the legislature shows that doctors are still moving into the state
more than they're moving out, and there has been no particular rise in
either malpractice cases or the awards granted in them. The local
insurance companies just want to keep more money.
Guess what else the Florida legislature passed. They
changed the rules for worker's compensation. Now, you can't get "catastrophic"
comp any more if you lose an arm in a workplace accident -- only if you
lose both arms! Or both legs, both eyes, etc. The word
they used for this change was "reform". Stopping those welfare chiseling
one-armed bums from living high on the hog, they are.
(In some future edition, I'm going to have to devote a lot
more space to medical and pharmaceutical corruption. It's a subject
worthy of its own page and its own dedicated muckraker to follow it.
Unfortunately, my natural temperament is to be much more interested in
energy issues. That's where my gearhead side intersects my green
In the latest back-and-forth on the issue of Americans buying
cheaper Canadian pharmaceuticals, Pfizer is warning retailers that if its
bean-counters find them to be buying too many pills to meet the needs of
their local customers, and are suspected of selling stuff south of the
border, Pfizer will cut off their supply.
Here's a crooked hospital in Redding, California (a small
city at the north end of the Central Valley): it's called Redding Medical
Center, and it was raided by feds as part of a broader investigation of
the company that owns it, Tenet Healthcare, which has been accused of Medicare
fraud and tax evasion since at least January. Then they got indicted
for further abuses in July. Hell, it turns out they were pleading
guilty of bribery and kickback games way back in 1994, and had supposedly
cleaned up their act. In 1997 they settled another case for $100,000,000.
Apparently, they just don't learn... or maybe their profits are such that
these legal cases are an acceptable business expense to them. Anyway,
it seems that Redding Medical Center responded to the Tenet directives
to maximize their bottom line by prescribing major
heart surgery for patients who did not need it. The more heart
surgeries, the more profit. Some patients died. At least one
suffered major permanent disability. The feds are settling the Medicare
fraud case for $54,000,000. Apparently criminal investigations are
continuing against a couple of individual doctors.
A crooked medical company: CG Nutritionals, owned by Abbott
Laboratories. Abbott has agreed to pay $622,000,000 in fines over
fraudulent sales of equipment for feeding patients through tubes, and sales
pitches that included instructions in how to scam Medicare.
Another: Schering-Plough employees may be facing charges
of obstruction of justice for shredding documents related to marketing
Another: Bayer pays $257,000,000 in the largest Medicaid
fraud settlement ever, for overcharging for the antibiotic Cipro.
(Cipro, by the way, is a drug that might save ten thousand lives a year
if it were made available in poor tropical countries at a price similar
to the cost of making it, or if it could be made by competing generic manufacturers...
but Bayer insists on getting their full price.)
A White House official indicted over stock tricks when he
was at a utility company in Indiana called IPALCO: Mitch Daniels, the outgoing
head of the Office of Management and Budget. He and about 30 others
took a big stock dump just before it underwent a 90% price drop, and Indiana
state investigators say this smells a little too ripe. Daniels quit
the OMB to run for governor of Indiana in 2004... and is considered the
Tim Pawlenty, the Republican governor of Minnesota who replaced
Jesse Ventura, turns out to have been tangled up with an exceptionally
crooked telephone company called New Access during the time he was running
for office. New Access was accused of widespread cheating of its
own customers. Pawlenty was on its parent company's board of directors.
His excuse is that he knew nothing of any complaints and "should have asked
more questions". He was paid by this and other telecom outfits for
"consulting", with the nature of the consultancy involved being awfully
Pawlenty also tried to bill arrested protest marchers for
the cost of arresting them (but not any other arrestees), and signed a
bill to force all school classes to lead pupils in reciting the
Pledge of Allegience. Not a fan of the First Amendment, this guy.
The Texas legislature passed a bill requiring all abortionists
to inform patients that getting an abortion increases their risk of breast
cancer. Which, according to the American Cancer Society, it does
not. Why not tell them it will grow hair on their palms while you're
at it, or that medical research shows they will not be forgiven by Jesus.
About three months ago, the Texas legislature also did a
possibly illegal end run around the agreed-on process for redistricting
the state, throwing out the work of the official commission of judges charged
with the job and tried to push their own ultra-gerrymandered plan through.
The Democratic minority could only stop this by leaving the state so the
R's didn't have a quorum. It was this that led to the notorious incident
you may have heard of, in which Senator Tom "The Hammer" DeLay (mentioned
in our last issue for handing billion-dollar regulatory favors to Westar,
a Kansas utility, for a mere $55,000 cut) sent out federal investigators
to track down the absent Democrats, whom he called "disloyal". In
fact, it was Senator DeLay, not any member of the legislature, who apparently
started the whole plan for gerrymandering the state. Meanwhile, Texas
House speaker Tom Craddick charged state troopers to go out and bring the
absent Democrats back to Austin by force! The cops could not actually
do that, of course, especially since the D's were outside their jurisdiction,
in Oklahoma. And one cop started a rumor that the legislators had
been in a plane crash, and suddenly the Department of Homeland Security
is involved... but that makes sense because, according to Republican representative
Dan Branch, the absent Democrats are "legislative terrorists".
Combine that with the incident in which the Republicans in
the House Ways and Means Committee sent
DC cops after some Democrats who walked out of a meeting in which the
Republicans tried to pass something none of the democrats had read, and
we've got a disturbing habit building up here. How long before the
party attempts to just start arresting representatives who interfere with
them legislating the way they want?
Speaking of Tom DeLay, it was he who sent out a fundraising
letter six months ago suggesting that labor unions were a threat to national
security and their members were unpatriotic, and when a stink was raised
about it, he blamed a "sloppy" staffer and denied any and all responsibility.
Of course, you might reasonably expect a staffer to write that way when
you tell them to write a fundraising letter for the Right to Work Legal
Defense and Education Foundation, an outfit that exists for the sole purpose
of attacking unions.
Before that it was Tom DeLay who told fellow Republicans
to try to hire more black staffers, so the organization doesn't look so
white and maybe they can groom some future black Republican candidates.
I thought you were dead against affirmative action, d00d.
More old news: Governor Mark Sanford of South Carolina joined
the Air Force Reserve during his election campaign. He said it was
because he wanted to set a good example for his sons, and said how much
he admired military service in others. Once he was governor, when
it started to look like there might be a war... suddenly he needed real
bad to get the hell out of the Air Force Reserve. Because his state
needs him, you see, and he doesn't have time.
a New York police official who skimmed $107,000 for himself from a nonprofit
foundation that was supposed to help the Department of Corrections.
No word on if he was a Republican.
are some corrupt Democrats in Brooklyn. Apparently they have an extremely
bogus system of selecting and promoting judges. They're now sending
someone who has been called "a nightmare of a judge" to the state supreme
court. Brooklyn is apparently the sort of place where even divorce
and child custody rulings are controlled by a system
of bribery, involving other state supreme court justices.
Ron Wieck, an Iowa Republican recently elected to the legislature
who sponsored a "tort reform" bill, one that made it more difficult to
collect damages in any civil lawsuit, sued somebody because a dog bit him.
(His bill was vetoed.)
The Republican Attorneys General Association has not only
been hitting up corporations for money -- corporations that all too often
are among those they have either regulatory authority over, or legal conflict
with -- but they have also
apparently been doing a bit of washing of that money afterwards.
By the time the money got to GOP campaign funds, there was no trace left
in the records of who had contributed it.
I guess I never mentioned Philip Giordano in here before.
He was the mayor of Waterbury, Connecticutt, and was the Republican party's
challenger for Joe Lieberman's senate seat in 2000. He's not mayor
any more, because he's serving 37 years for making eight and ten year old
girls give him oral sex. In his city hall office. He's not
the only Republican in trouble this year for making sexual use of minors
-- there's fundraiser Richard Anthony Delgado, for instance, or Robin Vanderwall,
campaign staffer for an extreme Christian-right moralist legislator in
Virginia -- but he's the worst. That we know of.
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