ENRON & FRIENDS


August 25, 2004:  It may be that Enron & Friends will soon wind down.  By "soon" I mean November.  If I continue to do some form of corruption watch over the new administration, it will not be on anything like the scale that this has had to be, and it won't have much to do with Enron.

At this point the Bush administration has pretty much fucked itself.  It has destroyed all its credibility and only those partisan enough to wilfully blind themselves to all its mistakes (mostly out of hatred of liberalism, apparently) are going to vote for it.  That's enough people to make a close race, but not enough to win.  At this point the Bushies have only two chances for re-election: (1) stealing the vote, or (2) a really good October Surprise.  Otherwise they're toast.  One political analyst, Larry Sabato of the University of Virginia, recently said that at this point Bush "really will need a miracle to win", and the reason for this is the war in Iraq; he says that by his analysis Bush would have had a landslide reelection if he had not started the war.  No wonder Bush has started describing himself as a "peace president", when not long ago he liked to call himself a "war president".

Meanwhile we get a White House insider telling reporters that if reelected, Bush is going to attempt a regime change in Iran.  Not with overt military action, just with "contra" style tactics, i.e. fomenting civil war.  An approach which, if anywhere near successful, probably creates more bloodshed than an overt invasion would.  Once again, North Korea is the Axis of Evil member that gets a free pass.  Since they're the only one to actually threaten us with a Weapon of Mass Destruction, the lesson I would expect the Iranian government to take from this is that successfully building a nuclear weapon really works as a way to keep the USA off one's back.  But maybe what really protects the North Koreans is just that there's no oil there.

The saga of Enron itself is nearing completion... here, for your enjoyment, is a picture of Ken Lay in handcuffs:

A gratifying thing to see, is it not?

Bush now describes his long relationship with Lay as just a "passing friendship".  When questioned further about Lay, Bush got mad and walked out, ending the media event early.

(I recently read a little blurb by a guy who used to fly Ken Lay's private plane.  He was wondering out loud how Lay could have gone bad.  His hypothesis: Lay was corrupted by hanging out with George W. Bush.  Lay'd had Bush on his plane since the early eighties... and Bush sometimes liked to sit in the control cabin.  Hey, I would too.)

By the way, Lay's attorney is Jim Sharp, who just a month ago represented George W. Bush in the case arising from the scandal of CIA agent Valerie Plame's cover being blown out of spite by a White House insider (rumored to be Dick Cheney himself).  (And by the way, John Ashcroft clearly should have recused himself from involvement in that case, but instead constantly monitored the investigation.)

One of Enron's former competitors, Duke Energy, recently reached a settlement with the state of California.  They're paying $207,500,000 and admitting no wrongdoing.  To me that sounds like we're probably getting back no more than ten cents on the dollar for how much they grabbed from us.  I'm afraid that governor Ahnuld is a little too eager to take it easy on these guys... but then, it already seemed to be working that way before Ahnuld took office.  Less than half of the money is cash; the rest is unpaid IOUs from local utilities.  That brings the total amount of settlement money brought in by Attorney General Bill Lockyer up to over $2,600,000,000 -- a respectable figure, but only about five cents for every dollar that was stolen overall.  More than half of that is from El Paso Natural Gas, which was only a peripheral player in the gouging.  The amount recovered from Enron remains at $0.  But then, Lockyer's lawsuit against Enron itself wasn't filed until two months ago.  At the time, he said "If FERC [the Federal Energy Regulatory Commission] had been aggressive from the beginning, we wouldn't have had to file these lawsuits."  Lockyer says the remnant of Enron still has some assets, but even if the state can't collect any cash the legal judgement is still worth pursuing.  He's hoping for a judgement in the one billion dollar range but realistically expects less.

By the way, the state's level of electricity usage is finally recovering from the reduced levels brought on by the crisis and the recession -- usage hit record levels on August 12 (my 45th birthday, as it happens), reaching 44.8 gigawatts.  (Enough energy per hour to weigh 1.8 grams, by E=Mc2.)  As yet, there is no shortage of generating capacity, though transmission capacity is getting a bit worrisome.  Most of the growth in consumption is in the Los Angeles area.  A legal plan was afoot to get generating companies to expand their capacity to have a 15% safety margin by 2008, but governor Ahnuld wants to move the date up to 2006, otherwise some predict we might hit a genuine shortage in that year.

Ahnuld seemed, before the election, ready to reinstate large portions of the failed energy deregulation package.  So far he's only asked to restore one piece of it: a means for large businesses to cut price deals directly with generators, bypassing utilities.  Some consumer groups think that could lead to higher residential prices, but overall, this isn't a very alarming proposal.  Still, TURN (the leading utility consumer group) describes Ahnuld's policy as "faith-based deregulation".  On the other side, the utilities are grumbling that very little is being done to restore order and make the trains run on time.

That's all I'll say about Ahnuld for now.  The plan is to devote more space to him in the next Enron & Friends.

Oh, by the way, PG&E has emerged from bankruptcy and is back to normal business.  The PUC settled on a bankruptcy deal that keeps consumer rates artificially high for the next nine years, more than 50% above the current national average price, to pay bills that PG&E owes to generating companies that profited from the crisis.  This will cost the average consumer about $1500!  Creditors didn't have to settle for getting partial payment -- in fact they're getting interest on the debt.  Likewise, PG&E and its shareholders have not had to give up any capital.  In short, folks, we got fucked.  The only way to un-fuck ourselves now is to hope that Bill Lockyer recovers more lawsuit winnings, because they mainly go toward relief of this ongoing surcharge.  Loretta Lynch and Carl Wood of the PUC filed a case arguing that the deal is illegal because it denies the state its regulatory power to adjust consumer prices, but the appeal was rejected.

PG&E's legal and administrative costs for dealing with bankruptcy court and getting the result they wanted: over $400,000,000.  A sound investment, from their point of view.  The lawyers who work on those Chapter 11 cases make exorbitant rates of pay -- up to $800 per hour -- and the investment bankers make thousands of dollars per hour.  (Scroll this audio stream to 17:45... but there's good stuff earlier about the corruptness of the old pre-Google style of stock IPOs, which basically consists of a method for insiders to get stock cheap and give each other kickbacks.)   And they get first dibs, before the creditors.  MCI/Worldcom recently set a new record for bankruptcy legal fees of $613,000,000, but speculation is that the Enron bankruptcy fees could end up topping $700,000,000.

Somebody emailed me a macroeconomic analysis by reader J. Kramer which concludes that a huge portion of the country's current recession was caused directly by Enron's ripoff of California during the electricity crisis.  I am not qualified to judge the validity of the analysis.  Anyone who wants to look it over can read it here, with minimal HTML formatting (the original was plain text).  His conclusions are clear enough.  There are three possible events that you can blame our recent recession on:  the bursting of the tech stock bubble, the 9/11 attack, and the California electricity crisis.  He correlates each of these events against changes in the economy, and also looks at the concrete macroeconomic costs involved.  His result: the gouging of the West with high electricity prices had a negative impact on the economy that was three times as big as the impact that the stock collapse had, and the economic impact of 9/11 was a surprisingly small part of the total.  He concludes that the current recession we are in was about two thirds caused by the electricity crisis -- not just California's recession, but the entire country's recession.  That act of thievery hurt everyone, not just people living in the west.  He further concludes that for the western states, the real economic burden imposed by the price increases was every bit as big as that of the 1970s oil crisis, which left the economy shaken for years.

If you've lost your job in the last few years, as I did three months ago, this may be a bigger reason to vote against Bush than all the foreign policy issues are.  This recession was caused, in part, by legalized thievery, and Bush and Cheney aided and abetted that thievery.  They denied the shortage was artificial, then they denied that tighter regulations or price caps would alleviate it, and when the chairman of the Federal Energy Regulatory Commission wasn't cooperative enough, they replaced him with a guy nominated by Ken Lay.  Fortunately, he surprised Lay in the end by finally supporting price caps, which ended the crisis.

To get back to the Bush administration, speculation about what kind of October surprise they might come up with is rampant.  My ex-boss (before the Bush economy toasted the company a few months ago and I became a gentleman of leisure) thinks they have Osama already and will pull him out then.  Others, more fearfully, are talking about the possibility of a fresh terror attack happening this fall.  Perhaps that's too paranoid.  Perhaps.  There are enough ideas floating around that at least one guy -- a radio DJ, I think -- has started a betting pool to see who can guess most accurately what the October Surprise is.

They even tried floating the idea of postponing the November election in the event of a terrorist attack, but the outrage was so complete (and many of Bush's enemies were going "I just knew they'd try this sometime!")  that they quickly disavowed the suggestion.  Just one or two minor staffers thinking out loud.  Nothing to see here, ladies and gentlemen.

I'm told that in Europe, where they have a bit more recent experience of hardcore demagoguery than we have, it's been a popular suspicion for a long time that Bush would find some way to stop the election.  But that is one thing that Americans truly would not sit still for.  I hope!

It's clear that they don't have Osama in a hole, waiting until October to whup him out -- the revelation that they were pushing the government of Pakistan to catch a High Value Target such as Osama during the Democratic convention made that clear:

"The Pakistani government is really desperate and wants to flush out bin Laden and his associates after the latest pressures from the U.S. administration to deliver before the U.S. elections."
-- anonymous Pakistani intelligence source #1

"[We] have been told at every level that apprehension or killing of HVTs before [the] election is [an] absolute must."

-- anonymous Pakistani intelligence source #2
(These sources are anonymous because revealing this stuff is a felony under Pakistani law.)  Specifically, the administration gave dates on which they wanted the capture of a HVT (high value target) to be announced: the last days of July, which happen to be when the Democratic convention was held.  And the Pakis complied, but the guy they got wasn't big enough to steal the headlines.  They captured Ahmed Khalfan Ghailani, one of the planners of some of Al Qaeda's embassy bombings.  The Pakis kept this quiet for a week before announcing it, just as desired by the Bush administration, on the morning of the very day that John Kerry accepted the nomination.  As cartoonist Scott Bateman put it, it's too bad the Democrats don't have a convention every week, or all of the Al Qaeda leaders might have been rounded up by now.

The Musharraf government is in a very awkward position with the War on Terror, because in the western part of the country the government is less popular than Al Qaeda is, and any really hard push to clean out the terrorists could lead to a new anti-US government.  On the other hand, the present government wants very much to please the US, and to keep a Republican administration, because they see this as being a powerful plus in conflict with India.  (The conventional wisdom over there is that Republicans lean toward Pakistan and Democrats lean more toward India, and Bush certainly has lived up to that.)  So, for much of the last two or three years they have tried to make a fair show of cleaning out the Taliban and Al Qaeda elements, but not tried too hard for fear of provoking a popular uprising.  Only in the last month or two have they really made a major effort and gotten better results.  And they did this because the Bush administration started leaning harder on them.

We know what this means, of course, and it's the same thing that has come out of pursuing the supposed War on Terror in Iraq instead of where our enemies are: the Bushies and their allies have inexcusably neglected the campaign against those who attacked America, and left them running loose for years after they might have been dealt with far more decisively.  The tiny forces we've deployed on the Afghan side of the border, and the half-hearted efforts on the Paki side, have combined to give Al Qaeda a free pass to hang on years longer than they should have been able to.  The fact that we are now seeing a new effort that is getting results, means we could have done that in the first place.  The anti-American sympathy that worries Musharraf is undoubtedly worse after invading Iraq than it was before, to back then would probably have been the better time for everyone.  But Bush wanted everyone to forget bin Laden so he could pursue Saddam.  (How far did this desire go?  Well, at Fox News, the order went out that Osama bin Laden's name was simply not to be mentioned on the air.)

In the absence of an Al Qaeda attack, they can of course issue terror alerts... but the public has started to disbelieve the terror alerts, especially when it came out that the last one was based monstly on very old data -- some of which had actually been previously reported to the public by CNN back in 2002 -- with no strong evidence that these plans were still active.  The administration has been scrambling rather desperately in its attempt to claim that there was some fresh intel behind the most recent "orange plus" terror alert -- the one that coincided with the end of the Democratic convention.  A comparison of terror alerts with Bush's polls shows that they have come a lot thicker and faster now that his approval numbers are at or below the 50% level... they used to be about one every two months; lately they've been a lot more frequent, without us being told anything helpful by them.  Here is somebody's analysis of the connections between the timing of terror alerts and political events damaging to Bush.

What fresh intelligence there is came from two operations: one was the above-mentioned Pakistani capture of Ghailani.  The other was an undercover operative inside Al Qaeda.  But it looks like the push to produce a High Value Target on a political schedule, or the desire to use politically timed terror threats, may have had severe long term consequences: this double agent has had his cover blown.  Who blew the cover?  One of the White House spinsters trying to claim that the intelligence behind last week's terror alert was not outdated, that's who!  He just went and blurted out the name of the source, an Al Qaeda member who had changed sides: Mohammad Naeem Noor Khan.  He had to run for his life and go into hiding under Paki government protection.

God damn stuff like this makes me mad.  Is there nothing the Bushies will not sacrifice for momentary political gain?  This is like the Valerie Plame case all over again, only much worse.  Or was it simply a moment of clueless incompetence?  Perhaps so.  Either way, Khan risked his life for our sorry asses, and was the best opportunity we had to really bring in a major group of terrorists... and now we've betrayed someone who was helping us and thrown away our chance to really nail this bunch of terrorists.  In fact, it was Khan who made the arrest of Ghailani two weeks ago possible.

The Pakistani operation wasn't the only one messed up: the British made a sudden set of raids and swept up twelve Al Qaeda suspects shortly after... because their own surveillance operation was interrupted by the revelation  of Khan's identity, and they had to hurry it up and arrest people prematurely, before they could follow them up and identify more suspects.  One of the people rounded up had to be promptly released again.

The Bushian struggle to save his administration has now proceeded to its next tactic: a smear campaign against the opponent.  The campaign is conducted by a group calling itself Swift Boat Veterans for Truth.  John Kerry commanded a "swift boat" in the Vietnam war, and during that service was awarded a silver star, a bronze star, and three purple hearts.  The smear group is claiming that he's not entitled to those medals and lied to get them.  They even say the purple hearts were not for real wounds... despite the fact that Kerry has shrapnel in his leg to this day.

The exact same kinds of smear tactics were used against Max Cleland in 2002, and against fellow Republican John McCain in 2000.  Both of these men made huge sacrifices for America in time of war -- Cleland lost three limbs, and McCain was a prisoner of the North Vietnamese for years -- and both had their military records lied about and their patriotism impugned.  In fact, the smears in those elections were run by some of the same people backing the Swift Boat Veterans for Truth.

The smear group is publishing a book, and accompanying it with TV spots, in which they essentially claim that their members served alongside Kerry and were there at the incidents where he was awarded medals.  None of them were actually on Kerry's boat.  Everyone who was is saying that Kerry deserved the medals and, in fact, saved their lives by gunning down a Viet Cong who was about to blow their boat out of the water.  (Kerry himself won't talk much about that incident -- according to his friends, he found the experience of intentionally shooting the guy traumatic.)  In the Bronze Star incident, veteran Jim Rassmann says that Kerry turned his boat around, drove it into enemy fire, and personally hung himself over the side while being shot at -- and while already wounded -- in order to fish him out of the water.  He says, in an editorial entitled "Shame on the Swift Boat Veterans for Bush":

Nobody asked me to join John's campaign.  Why would they?  I am a Republican, and for more than 30 years I have largely voted for Republicans.  I volunteered for his campaign because I have seen John Kerry in the worst of conditions.  I know his character.  I've witnessed his bravery and leadership under fire.  And I truly know he will be a great commander in chief.

...  This hate-filled ad asserts that I was not under fire; it questions my words and Navy records.  This smear campaign has been launched by people without decency, people who don't understand the bond of those who serve in combat.  As John McCain noted, the television ad aired by these veterans is "dishonest and dishonorable."  Sen. McCain called on President Bush to condemn the Swift Boat Veterans for Bush ad.  Regrettably, the president has ignored Sen. McCain's advice.

...  Texas Republican donors with close ties to George W. Bush and Karl Rove crafted this "dishonest and dishonorable" ad.  Their new charges are false; their stories are fabricated, made up by people who did not serve with Kerry in Vietnam. They insult and defame all of us who served in Vietnam.

One of the accusing Swift Boat Veterans is Larry Thurlow, who also earned a bronze star in that same incident.  Now he claims Rassmann was not under any enemy fire. If this is true, it means Thurlow's own bronze star is just as fraudulent as Kerry's.  He claims Kerry planned ways to earn purple hearts -- a charge for which he admits he has no evidence, and which is, let's face it, pretty ridiculous.  If one was going to plan to get medals, a purple heart is the last one you'd want to go after intentionally.

Another was Alfred French, a senior deputy district attorney in Clackamas County, Oregon, who said "I served with John Kerry" and "He is lying about his record", but finally had to admit he never saw any of the incidents he claims Kerry was lying about.  What makes this awkward is that he filed a sworn affidavit saying he knew Kerry was lying.  Since to swear an affidavit on nothing but hearsay is basically perjury, a lot of Oregonians are demanding his resignation from the district attorney's office for gross unprofessionalism.

The strangest part of the Swift Boat Veterans story is the behavior of Kerry's former commanding officer, George Elliott.  He keeps changing his story.  He lauded Kerry as recently as 1996, but this year signed a Swift Boat Veterans affidavit saying he thinks Kerry didn't deserve the Silver Star, then he told a Boston Globe reporter that he made a big mistake by signing that and he still thinks Kerry deserved the medal, then he claims the reporter misquoted him, and the Globe said no we didn't, it's on tape... back and forth the story goes.  I can only go, WTF?  Is somebody applying some kind of blackmail pressure, or something?

As mentioned by Jim Rassmann, the Bush administration chose not to condemn the Swift Boat smear.  Ironically, it was George W. Bush who in 1992 wrote a letter asking fellow Republicans who supported his father to refrain from making dishonest attacks against Bill Clinton.

Time will tell whether the mud sticks at all.  With most of the guys who served on Kerry's boat taking a similar line, saying Kerry fully earned his medals (including one Mike Medeiros, who lives not that far from me, who says the accusations are "totally false"), it's probably just a matter of how well the voting public manages to hear both sides.

By the way, one of the co-authors of the book is Jerry Corsi, who is now finding himself having to apologize for repeated hate slurs along the lines of accusing both Islam and Catholicism of supporting pederasty, suspecting Kerry of being a closet Jew, calling him a "fucking Commie", calling "HELLary" Clinton a "fat hog" and suspecting that Bill went outside their marriage because she's lesbian, calling Islam "worthless" and "Satanic", etc.  He claims he didn't mean any of it.  The other author, John O'Neill, claimed to have "had no serious involvement in politics of any kind in over 32 years"... then it came out that he'd given $15,000 of his own money to Republican candidates (and $0 for Democrats).

John McCain, meanwhile, is apparently quite furious with this tactic -- I sure would be, in his place -- but is still supporting Bush's reelection as a loyal Republican, despite reportedly loathing him in private.

(As one blogger put it: "Focus on John McCain's face; it looks like he's being felt-up by his grandmother.")  McCain did say that there's nothing wrong with Kerry on defense.  He also said "I believe my party has gone astray" back in April, at which time he also expressed disgust for Bush's aircraft carrier flight suit stunt.  But he still campaigns for Bush.

I even found one pro-Bush veteran who thinks Kerry really did tell some lies about Vietnam deploring the Swift Boat Veterans smear as rotten.

One Republican who is not supporting Bush any more is Ron Reagan: in Esquire magazine, he wrote that "The Bush Administration cannot be trusted.... George W. Bush and his administration have taken 'normal' mendacity to a startling new level far beyond lies of convenience.  On top of the usual massaging of public perception, they traffic in big lies, indulge in any number of symptomatic small lies, and ultimately, have come to embody dishonesty itself."  Meanwhile, Nancy Reagan refused to appear at the Republican convention, and has reportedly told GOP leaders in private that she wants nothing to do with the Republican party any more, and especially not Bush, whom she views as "extreme".  The only Reagan still supporting Bush is Michael.  He claims that Nancy's lack of support is all because she always liked Ron better than him, so Ron is guilty of "manipulating" her.  What a mature guy.

Another guy who has renounced Bush is the neoconservative author Francis Fukuyama.  He's a friend of Donald Rumsfeld but is now calling for Rumsfeld to resign.  And this is one of the guys who signed the notorious Project for a New American Century document -- the one that reads suspiciously like a blueprint for the entire Bush administration, including 9/11, before he was elected.

Another Republican who has lost faith is Pat Buchanan, who recently published a book called Where the Right Went Wrong, arguing that the neo-cons have taken over the GOP and destroyed true conservatism in favor of Big Brotherism.  Of course, in Buchanan's case one can't help suspecting that part of his beef against neo-cons is that they're not racist enough.

Former Reagan administration press staffer David Gergen said of the Swift Boat ads, "This is really a mistaken, terribly wrong-heading pattern for the Republicans."  He thinks Big Lie tactics help a party in the short term but hurt in the long term.

When prodded by McCain to disavow and denounce the Swift Boat Veterans smear, the White House responded by suggesting that we should rein in all independent campaigning groups.  See, they are getting badly hurt by the fundraising and advertising prowess of MoveOn.org, and they are wishing with all their might that they could make it go away.  They already tried one legal attack, which fell flat.  All of a sudden the opponents of campaign finance reform are in favor of draconian limits, because suddenly all their rich friends are raising less money than the more grassroots support of the opposition is.  They also tried to organize a conservative MoveOn-like group, and it never amounted to much.  In fact, to get small-scale internet fundraising of the type pioneered by Howard Dean and MoveOn off the ground, they had to offer participating webmasters a 30% commission.  Dudes, the whole reason web-based donating worked so well for liberals was because of its low transaction cost.

Kerry himself finally came out swinging at the Swift Boat Veterans group, and accused them not only of lying, but of directly collaborating illegally with the Bush campaign, on the basis of a New York Times story that diagrammed the web of common links between the two groups, particularly via Karl Rove.  Further scraps of evidence turned up in the following days: a Swift Boat pamphlet displayed in Bush campaign offices, a Swift Boat Veterans talking head named Ken Cordier turning out to also be on the Bush-Cheney National Veterans Steering Committee, with his name listed on Bush campaign websites (but removed quickly once the connection came out -- he had to resign soon after), and also a member of a White House administrative committee on veterans' affairs.  Cordier was an Air Force man, not someone who ever did duty on a boat.  His beef has nothing to do with Kerry's actual performance in combat -- in fact, Cordier was in a POW camp the entire time Kerry fought -- he is just someone who could not forgive Kerry for testifying against the war in Congress.  His sense of betrayal as a POW may be heartbreaking, but it certainly doesn't qualify him to endorse claims about what actually happened on those boats.

Later, another person working in both camps was identified: attorney Benjamin Ginsberg.  He resigned his position in the campaign.  And someone caught a Bush campaign office soliciting donations to the Swift Boat Veterans.

Kerry filed a complaint with the Federal Election Commission demanding that the Swift Boat ads be pulled off the air -- something very unlikely to actually happen.  The Bushies replied by making a similar accusation that MoveOn and other groups are collaborating with the Kerry campaign, largely without concrete evidence of the kind Kerry has.

Another event, besides the Democratic convention, which coincided fairly closely with the latest terror alert was the release of more of George W. Bush's military records from the Texas Air National Guard.  For weeks the Pentagon claimed that the records -- just a few months' worth -- had been accidentally destroyed.  Then they said they found them in a manila folder that had gotten misplaced.  This story seems unlikely, because the official policy of the office that stores old military records calls for everything existing in at least three copies on microfilm, the original being stored securely and recorded on a film stock with a normal lifespan of at least 75 years.  The story was that the microfilm had "deteriorated".

What we saw of the records didn't show anything bad or embarrassing... but neither did they contradict the charges that he went AWOL in 1972.  They failed to show him doing anything in the disputed period.  They did show him getting an honorable discharge... but wait, what's this?  Here's a notice of Bush's honorable discharge:

The last sentence seems to say "DD FORM 258AF will be furnished."  Now it's possible that this grainy-ass copy is just making it look like "258AF" when it really says "256AF"... but it looks like 258AF to me.  Why is that important?  Because 256AF was the form number for a reservist's fully honorable discharge, and 258AF was the form for an "undesirable" discharge.  It would be nice to know the story.  Even with the forms already released, one guy named Paul Lukasiak, who has dug into the meaning of every bit of paper and knows how to interpret every hole in the punched cards, says it's already proven that Bush was paid for duties he didn't show up for.  His analysis is here.

Then there are some who argue that Bush overstated his military record, and may have been photographed wearing a medal he never earned.  (The latter story was uncovered by an amateur like me, one Walt Starr, but later picked up by Michael Moore and others.)  Some of his older campaign literature actually claimed that Bush flew in the Air Force, which of course he did not.  When asked about this, he appeared to be thinking that "air force" was a legitimate term for the Texas Air National Guard -- an understandable bit of verbal confusion for him, but the term also appeared in campaign literature.  He also claimed in the old literature that he had flown with them for "several years", a definite exaggeration.

By the way, when Bush was at Harvard, one of his old business school professors, Yoshihiro Tsurumi, says he bragged about how his dad's importance got him perks such as getting to the top of the waiting list for the Texas National Guard so he wouldn't have to go to Vietnam.  He "displayed a sense of arrogance" about his level of privilege.  "He wasn’t bashful about how he was being pushed upward by Dad’s connections."  He also says Bush constantly made "flippant" remarks to him "revealing of his prejudice."  Tsumuri says Bush was enough of a right wing nut that he called the Securities and Exchange Commission "an enemy of capitalism".  He says his opinion of Bush at the time was, "if you become president of a company some day, may God help your customers and employees."  He says he tried to tell people about this in 2000 but the media mostly ignored him... though he did get a couple of death threats.  But hey, Bush recently came out against "legacy admissions" of the kind that got him into the top ivy league schools without having to work for it.

(On a related note, one of the board members of the Carlyle Group, a financial organization that includes lots of George Bush the Elder's friends, remembers George W. as someone who was put on the board solely because it was asked of him as a favor, and whose main contribution was to tell dirty jokes, and who was eased out a few years later with the suggestion that he might show his talents better doing something else.)

It might bear mentioning that Bush wears military garb more often than any other modern world leader except Fidel Castro, and Saddam while he was in power.  All this sort of crap is probably the reason why, according to a CBS poll, Kerry recently pulled ahead of Bush with veterans... though the Swift Boat charges are now pulling that figure down again.  Bush led strongly among veterans three months ago.  I doubt he's doing even that well with active duty soldiers, especially given what a piss-poor job they're generally doing these days of supporting servicepeople and their families... morale in the ranks is rumored to be abysmal these days, with retention of soldiers whose terms are up at an all time low, for which reason the Pentagon has resorted to invoking a special rule that lets them force soldiers who thought their terms of service were complete to serve years more, thus making morale even lower.

Anyway, MoveOn responded to the Swift Boat ad campaign with an ad of its own hitting Bush on the AWOL issue.  McCain called on Kerry to denounce the MoveOn ad just as he called on Bush to denounce the Swift Boat Veterans.  Kerry did so, repeating his call for Bush to match him.  After some prolonged reluctance, Bush finally called on both groups to stop, but used the occasion mostly to call again for clamping down on the "soft money" supplying both sides... though in the one case the money comes from grassroots small donors like me, and in the other it clearly comes from Bush insiders.  Bush position now is apparently that he wants the entire campaigns controlled by the political parties alone.  (McCain has led the battle to ban "soft money"... back then, Bush opposed him.)  Bush still stopped short of actually condemning the ads.

Although he denounced the AWOL ad, a Kerry campaign-affiliated news conference did feature General Wesley Clark and Admiral Stansfield Turner accusing Bush of using family connections to escape hazardous service.  That charge, unlike the rather uncertain AWOL one, is one Bush pretty much can't duck.  The fact he was actively seeking to avoid Nam are clear from Bush's own words, from 1990: "I was not prepared to shoot my eardrum out with a shotgun in order to get a deferment.  Nor was I willing to go to Canada.  So I chose to better myself by learning how to fly airplanes."

Speaking of the question of whether the mud will stick and whether the voters will get to hear all sides thoroughly, an anonymous insider in the Kerry campaign has this to say:  "John Kerry's chief opponent is not George Bush.  It's the media."  For example, in the case of the Swift Boat Veterans, here is what I have been hearing from the pundits discussing the campaigns:  they will discuss endlessly the content of the charges, the statements Kerry has made in response, the spending on ads and the media strategy of both sides, the charges filed with the election authorities, and so on, but they will not touch in any way the key central question of the Swift Boat Veterans issue, which is whether the charges are true.  They treat this as a complete non-issue!  There are concrete undeniable falsehoods in the Swift Boat charges, mainly statements like "I served with John Kerry" coming from people who did not, or claims that certain people who served with Kerry don't support his candidacy, when they do, and are very pissed at the group for misrepresenting them.  But all that gets mentioned about this is that Kerry has a different version of the story.  Even Kerry's bald statement "Check the shrapnel in my leg!" in response to those accusing him of faking wounds goes unquoted.  They quoted John McCain calling the ads "dishonorable", but not him calling them "dishonest".  They leave the impression that the whole dispute over them is about legal technicalities, not over whether they are mendacious fantasies that some right-wingers pulled out of their asses.

Speaking of right-wing asses, by the way, the Swift Boat Veterans' book is published by Regnery Press, an extreme rightist publishing house previously best known for publishing books full of the most far-out and unsupported sorts of anti-Clinton rumors.  The family has a history of extremism... the publishing company's founder, William Regnery I, was part of a pro-Nazi group trying to keep the USA out of WWII.  The company's earliest books, after the war, were still pro-Nazi.  William Regnery II, brother of the publishing company's current owner Albert Regnery, is a white supremacist whose latest business venture is a whites-only dating service.

One reason why this anonymous campaign strategist considers the media a bigger enemy than Bush can be seen here: it turns out that since Kerry emerged as the winner in the Democratic primaries, up until the convention, the news media started giving him less and less airtime, to the point that Bush was getting four mentions for every one of his.  Some advantage in this area is to be expected for an incumbent, but that might be a bit much, no?  This insider urges Kerry supporters to join and support media watchdog groups, and just generally get the word out about whatever media distortions they notice.  Now, we all know that Fox News is a propaganda organ of the Republican Party -- that's not news.  (Though it's still good that someone took the time and energy to document proof of it, in the documentary "Outfoxed", which is based in part on Fox internal memos available here.)  What isn't commonly recognized is the bias, or leniency, of other news organizations not so overt in their non-neutrality.  It's now widely accepted that news media in general are gradually giving up the effort to maintain any objective neutrality, and are dividing themselves more and more into groups with opposed partisan slants.  A lot of readers and viewers actually like this... especially on the conservative side, it seems to me.  One factor driving this is the proliferation of non-mass media -- small-time information sources such as, for instance, Enron & Friends.  A bigger source is the dismantling of the regulatory rules that used to exist when I was young, things like the "Fairness Doctrine", which gave government authority to the principle that the news should not be partisan.  That system was dismantled by Republicans.  A third factor is the campaign by big media owners to legalize massive semi-monopolies such as that of Clear Channel in the radio business.  (Clear Channel is so nonpartisan that in 2002 and early 2003 they provided corporate sponsorship for pro-war rallies, and they've become known for banning from their airwaves performers critical of Bush.)  A fourth factor is the increasing revenue that all of the media get from political advertisers... an increase that correlates directly with a decrease in true reporting on politics.  The media act increasingly as mere channels for established and upcoming power figures and factions to speak through, rather than as investigators and analysts in their own right.  So the overall content contains more and more spin, less and less discovery of facts.  If no major faction benefits by a given fact being publicized, that fact probably won't ever be told to the public.

The conventional wisdom is that of the two main cable news channels, Fox is for Republicans and CNN is for Democrats.  But anyone who thinks CNN has a pro-Democratic bias should check what Paul Krugman has to say on the matter.  He cites the Columbia Journalism Review's statement that CNN “has stooped to slavish imitation of Fox’s most dubious ploys and policies."  David Brock (author of Blinded By The Right), hardly a liberal himself, says liberals have sometimes been sidelined by CNN.  Here's a group that has a detailed list of Fox-like crap CNN did during coverage of the Democratic convention.  What's going on here?  Simple: Fox's ratings are higher than CNN's, so they're starting to fight over the same conservative audience.  I guess liberals watch less TV, so they're a smaller market.  (I know that liberals tend to use more varied news sources than conservatives do, so the idea that they spend less time before the tube is plausible.)

Fox itself, meanwhile, is resorting to outright lying during their coverage of the convention (e.g. claiming Dems did not applaud things Kerry said about strong defense, when they did) and to not allowing viewers to even hear major speeches, putting their own yammering heads on the air instead.  At other times, they do nice things like run Bush campaign ads as part of a story allegedly about ads, randomly asserting that Kerry is pushing the stock market down, and hyping polls that show Bush doing better than what all the other polls show.  I already mentioned their internal policy of never mentioning Osama bin Laden...  (Hey, guess who the source for that tidbit is?  Ron Reagan says he was told of it privately by a Fox employee.)

Rupert Murdoch's hands-on management of what the news is supposed to say did bite him in the ass recently: his New York Post published a Dewey-defeats-Truman headline saying that John Kerry's running mate would be Dick Gephardt.  Apparently the "source" for this tip was Murdoch himself, but he strenuously denies it now.

Things could be worse... in Italy, a figure very much like Rupert Murdoch, with a media empire similar to Fox (including the greater emphasis on sexual crassness than the competition) got himself elected Prime Minister.  Silvio Berlusconi.  Fox doesn't quite have that much influence, thank God.  Berlusconi is now in increasing legal trouble for things like bribing judges, by the way.  And hey... remember when Bush used that fake intelligence about Saddam trying to buy uranium ore, in his State of the Union speech?  It looks like the phony report came from Berlusconi.

The main media outlets usually accused of being full of liberal bias are the New York Times and the Washington Post... but they aren't much in volume compared to the totality of news media; they're just higher in credibility... and in actual news-gathering effort.  The Post can be rough on anyone who's in power; they hardly gave Clinton free passes.  And it was the New York Times that embarrassed itself with a whole series of "news" stories about Iraq's weapons of mass destruction that turned out to be fanciful.  The lies they've been caught telling were conservative ones.  And the Washington Post is now confessing that it softballed stories questioning the Iraqi WMD dogma.

I don't believe we really have any "liberal media" on a national scale.  We have a choice between centrist media and conservative media.  Well, maybe NPR is liberal.  Whoop de doo.  But certainly not to a degree comparable to the conservatism of Fox... to find that on the left, you have to go to something as small and obscure as, say, Pacifica Radio.

In today's climate, even such a minor (and obviously needed, for balance) thing as a liberal call-in talk show can end up being suppressed by sponsors, not permitted to be broadcasted.

Now, back at the top of this article, I said that a Bush victory would probably require either a really good October Surprise or some election stealing.  How are things looking on the election stealing front?

Well, the whole issue of touchscreen voting continues to boil along, but not in a way that looks like it's going to resolve anything.  The state of California recently decided, to my aggravation, that the security issues of the touchscreen machines they've got have now been resolved.  Correction: "many" of the security issues have been resolved -- mainly by tightening procedural requirements on the county election officials' management of the system.  (The approval is on a county-by-county basis as they implement the requirements.)  Hopefully with good supervision of the servers nobody will be able to hack in... but I still ain't putting my vote into one.  We still have no way to verify whether the touchscreen terminals report votes accurately to the servers.  If Diebold chooses to change every tenth vote, we'll never know it happened, and no amount of security consciousness among the server managers can stop it.  Because the key missing piece is that there is no way in the world for any voter or election official to check whether the vote totals sent to the server match what the users entered on the screen.

At least one company has tried to float a system where the servers were at company headquarters, not under the control of election officials.

Now one thing that hasn't been discussed all that much about the touchscreen voting machine issue is just what level of security paranoia is really necessary and appropriate when dealing with machinery that people have a motive to corrupt.  Take a look at the banking industry: they use software there that has to protect your money from any possible embezzlement scheme... and you know how they do it?  They write the programs with the assumption that every single bank employee is looking for a way to steal something.  Nobody is ever trusted to have authority to fuck with the contents of the account records, and absolutely everyone's work is double-checked in some way.  I'm told one former banking software guy (I wish I had his name on hand, but I can't find it) who went to work at the touchscreen voting places ended up telling people that he was appalled at the total lack of such protections in defending something as valuable as the integrity of the vote.  The software constantly entrusts company technicians, election workers, and all kinds of other people to have access to messing with the vote data.  Any one of these can rig the vote and cover all traces of it.  If they had been making video slot machines, you can sure bet they would have put in a lot more security and accountability.  (Or would they?  Diebold recently got in trouble for selling an automatic teller machine with security holes.)  In other words, one reason the problem is so gross is because they're doing the job like total amateurs (a conclusion hard to avoid in the case of that ATM), even if you assume that the company has the most honest of intent... which is hard to assume when both Diebold and ES&S are headed by hardcore Republicans, and ES&S has shown signs already of, at least, rigging the Ohio legislative process for approving their machines, if not the vote totals themselves in the 2002 Ohio senate race, which was won by Chuck Hagel... the ex-CEO of the company making the machines the votes were cast on.  Wally O'Dell, head of Diebold, recently made a too-little-too-late announcement that he's not going to actively fundraise for George W. Bush any more...

By the way, a smaller touchscreen voting company, Sequoia Voting Systems (based in my home town, Oakland... yet my county uses Diebold machines) recently demonstrated a new model that prints a permanent paper record for verification -- something its three main competitors haven't yet bothered to build.  The demo flopped; the printer failed to print some votes.

Bev Harris and some of her "Black Box Voting" crew have been touring around the country, showing state and local election officials how hackable their touchscreen vote counting servers are.  Hopefully this will help.  One new voice which has been added to those calling for requiring a verifiable paper ballot record is that of Hillary Clinton.  Howard Dean is raising the issue too.  The League of Women Voters has retracted its endorsement of the technology.

Harris and her colleague Jim March, a California computer expert who once created a "rig-a-vote kit" out of leaked Diebold files, filed suit against Diebold in California last November.  For some reason beyond my feeble understanding, the case was kept sealed for months, and only became public knowledge after attorney general Lockyer unsealed it in July.  It alleges that the Diebold machines are shoddy equipment and asks Diebold to refund what the state and counties have paid for the hardware.  They hope the state itself, or some counties, will join the suit as a plaintiff.  They took this approach, of alleging fraudulent sales to the state, because it was an area where the legal lines are clearer than they are in the area of voting integrity.  The delay is seriously unfortunate... the state may not decide whether to join the suit until September.

In Florida, a Republican group put out a pamphlet warning voters that touchscreen voting was untrustworthy (it might be hacked by Democrats) and they should use absentee ballots.  Then the higher-up Republicans made them apologize and retract what they said in the pamphlet!  Jeb Bush® and his new Secretary of State have been urging everybody for months and months to trust the machines, and fended off efforts to have them independently audited -- Jeb says you should trust the machines because he has "every faith and confidence" in them.  Meanwhile, a suit has been filed in Florida asserting that touchscreen voting is less reliable at the user end than previously assumed, as shown by the fact that it gets more "undervotes" -- lack of any recorded vote in major races -- than optical scanner ballots do.  Statistics available before they bought the machines showed touchscreen systems to be "unreliable" in some way or another (from technical trouble to user difficulty) three percent of the time, just as bad as the punch card systems everyone wanted to get rid of.  Optical systems have a tiny fraction of that trouble rate.  Common Cause and the ACLU are also challenging the decision by Jeb's administration to impose a rule that no attempt should even be made to do any recounting of touchscreen results, and the initial numbers should be considered infallibly final.

An international group called the Organization for Security and Cooperation in Europe is sending international observers from their human rights office to monitor our election.  That's how much the rest of the world trusts our current electoral process.

The Venezuelan faction that's been trying to oust president Hugo Chávez finally got their referrendum to recall Chávez. Voting day was August 15, and Chávez won again.  The recall backers were the same group that tried guns first and democracy afterwards... namely, Venezuela's rich business community, which consists mostly of white people.  (Venezuela never had a non-white head of state before Chávez!)  And guess what: they used touchscreen voting machines.  But they're not Diebold or ES&S machines, they're from a Florida company called Smartmatic, which was founded by Venezuelan emigrants, and they do create a paper record.  The machines have never been tested in a real election before.  Machines made by ES&S failed to work in Venezuela's 2000 election.  They had to delay the election two months.

If these Smartmatic machines have any crookedness, the suspicions being most widely expressed is that they are pro-Chávez, since his people picked them... but the choice of a system with a verifiable paper record argues against any intent by Chávez to cheat.  Chávez charges that the petitions used to launch the recall had huge numbers of faked signatures.  He's told his constituents that George W. Bush is behind the recall initiative and that the issue is not who is president, but whether Venezuela is a sovereign nation or will "once again become an American colony".  Chávez promises to abide by the outcome of the vote... some of his opponents were talking civil war if they lost.  After the election, they charged massive fraud and insisted that they had won, even though their own pre-election polls showed them losing.  We will see what kind of bullshit they pull next... I hope it's something nonviolent, but I can't say I expect it to be.

Oil prices spiked way up before the referendum and came back down afterwards.  The U.S. elite may want him out, but the international oil market wants stability.  Of course, the lower price on either side of the spike is already exceptionally high, due to instability in (cough) certain other oil-producing regions.  And Bush once promised that he's heavily pressure OPEC if oil got more than half this high... it was one of his campaign points in 2000.

Meanwhile, we've been getting reports of a whole series of smaller scale dirty-trickery on the vote stealing front.  Some examples:

How about a nice Halliburton story?  (Halliburton story!  Daddy daddy, tell us another Halliburton story!)  Well, there are a few little Halliburtonian tales to tell today: one is that they spent $1,800,000,000 of taxpayer money that they now can't account for the usage of due to sloppy-ass record keeping, a fact that came to light once outside auditors from the Pentagon were called in.  Get this: Halliburton's official response was that this audit result was "just an opinion", and the sort of thing that's only being made an issue of because it's an election year.  They actually said that!  The Pentagon replied that they ought to come up with better answers for where the money's going if they want to get paid -- about $600,000,000 could be held back.  In fact, the Army announced at one point that the money would be held back, then retracted the announcement... and we still don't know what the final decision will be.  Halliburton also blamed "tunnel vision... naiveté... [and] ulterior motives" for whistleblowers coming forward with testimony against them (as described in the previous Enron & Friends).  The whole mess has led to more than two dozen separate criminal investigations.

Second: Halliburton has also been caught spending money that belongs to Iraq instead of U.S. money, around $1,900,000,000... and offered as its excuse that the U.S. taxpayer money it was supposed to be using had too much inconvenient red tape attached to it.  I can sympathize; I do usually find that there's less paperwork if I steal someone else's money instead of dealing with my own bank.  Another case found $600,000,000 of Iraqi money that was spent with insufficient accountability to see where it really went... how much this sum might overlap with the $1,900,000,000 I don't know.

Third: Halliburton just got fined $7,500,000 by the SEC for bogus revenue-inflating accounting practices which were put in place while Dick Cheney was CEO.  And four former employees just filed suit over these same accounting bogosities.  (An earlier suit with similar charges got thrown out.)

Fourth: a unit of Halliburton based in the Cayman Islands (riiiiight) just got subpoenaed for illegally doing business with Iran.  The case has been kicking around in the Treasury department for a few years; now it's in the hands of the Justice department.

Fifth: here are some Halliburton truck drivers who say they were sent on dangerous driving runs with empty trucks, just to be able to bill the government for nonexistent services -- risking their lives so somebody else could rip off taxpayers.

With all these troubles, and others (including some old asbestos claims), the company is actually in Chapter 11 reorganization even as it scoops up the cash in Iraq.  The Halliburton situation is getting embarrassing enough that Democrats are praying that Bush doesn't replace Cheney with someone untainted.  Some Republicans, such as Alphonse D'Amato, say Bush should jettison him...


As I have often done before, here is a list of brief other story items related to corruption... enough to make this the longest E&F edition ever:

To close, here's a corruption scandal or two involving Democrats.  Kevin Shelley is the Secretary of State of California, elected in 2002. (Yeah, he's the guy who had final responsibility for deciding that it's okay to use touchscreen voting machines in California.)  And in that election, it looks like he took donations of $100,000 from a San Francisco nonprofit -- an organization which got $500,000 from the state government, thanks to none other than Shelley.  So it appears that Shelley basically got a kickback on a grant he arranged.  The money was laundered through private intermediaries who were paid as alleged consultants and contractors, and these intermediaries apparently got $8,000 more for themselves as a shipping and handling fee.  The $500,000 was supposed to be so that the San Francisco Neighbors Resource Center could build a community center to support Asian immigrants... it was never built.  Now Shelley is making a big show of cooperating and calling for full investigation.   "If this sequence of events is true, very frankly I'm disappointed and more than outraged."  The FBI is involved.

How does this differ from most of the Republican scandal stories I report?  Here's how: this one has gotten multiple front-page headlines.

Another Democrat in trouble is New Jersey fundraiser Charles Kushner.  It seems that when a friend of his was about to testify against him in an investigation of campaign finance chicanery, Kushner hired two prostitutes to have sex with the guy and tape it, so he could threaten to reveal the tape to the guy's wife.  Apparently he never managed to carry out the plan.
 



 
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