News and Features
SEC chairman Harvey Pitt lurches from lapdog to bulldog, threatening
CEOs with jail time if their corporate reports mislead. George Bush
demands "top floor" accountability. Republican leaders in the House
muscle their own caucus members into passing a sham prescription drug
The run-up to the fall elections has begun. Barely a month ago, White
House political guru Karl Rove was telling Republicans they could retain
control of Congress by waving the flag, celebrating the recovery and
promoting an ill-defined "compassion agenda." Now, with the dollar and
the stock market sinking, the recovery looking shaky and Vice President
Cheney back in hiding as investigations widen into accounting deceptions
at his former company, Halliburton, Republicans are getting nervous.
Americans don't want the war on terrorism turned to partisan purpose,
pollster Stan Greenberg informed a Campaign for America's Future press
briefing, "and they want this election to be about their own pressing
concerns"--the soaring price of healthcare, educating their children,
paying for college, decent jobs with good benefits and whether they can
afford to retire now that their 401(k) has become a 201(k).
At such a moment, progressive reforms are not only good policy but good
politics. Add a real prescription drug provision to Medicare. Get
serious about cracking down on HMOs. Invest in teachers, schools and
after-school care and help with college tuition; pay for it by closing
down offshore tax havens and making billionaires pay what they did
before George W. Bush cut their taxes. Raise the minimum wage and curb
excessive executive pay packages. Protect workers' pensions and
prosecute corrupt corporate executives. Save Social Security from
privatization's benefit cuts. Stop fast-track trade authority and demand
trade accords that strengthen rather than diminish worker, farmer and
environmental protections. Make polluters pay for cleaning up their
toxic wastes instead of sending the bill to taxpayers and slowing the
The popularity of these reforms has led Republicans to add political
cross-dressing to the Rove strategy: Hug a tree, hang a CEO, don't say
the word "privatization." Whether they can get away with this is
unclear. It's a bit like putting pearl earrings on a sow. It's an
all-too-real prospect, however, at a time when Democrats control the
Senate but fast track passes easily, when Senator Ted Kennedy still has
trouble getting fellow Democrats to sign on for a rewrite of Bush's
fundamentally flawed tax plan, and when Democratic Leadership
Council-addled "money Democrats" blur the differences between the
If Democrats hope to win in 2002, they will have to do it the
old-fashioned way--by running as Democrats. And labor, community, civil
rights, women's and environmental groups will have to give them a push
in the right direction--just as they did with the successful effort to
keep the GOP from enacting a permanent repeal of the estate tax. Rove
and his army of strategists are masters at filling the narrow cracks
between the GOP and "kinder, gentler" Democrats. Only by opening a
significant divide between themselves and the GOP can the Democrats
emerge as the alternative that Rove and his minions fear--and that the
voters are ready to embrace.
"How long do I have?" James Pierson asked, trying to maintain eye
contact with the man behind the desk.
"Three months, eleven days, seven hours and forty-three minutes,"
David Barnett said.
"Well, it's now the afternoon of August 19, 2010," Barnett said. "We're
advising people not to wait until the very last day. December 31 is a
time when there can be a certain amount of New Year's Eve chaos at
hospitals, and that could put the death certificate over until next
year, or at least muddy the waters if there's a question that ends up in
court. So, getting it done in 2010, if you're being prudent, means
getting it done before December 31, or three months, eleven days, seven
hours and forty-three minutes from now."
Pierson swallowed. He found the phrase "getting it done" off-putting.
Finally, he said, "I don't suppose there's a chance that this could be
"Well, in theory there's always a chance," Barnett said. "The Democrats
could come back after recess and announce that they've changed their
minds, and, despite everything they've said in the nine years since
2001, they're going to make the repeal of the inheritance tax permanent,
but I don't think it would be wise to count on that happening."
"So it's now or never is what you're saying?" Pierson said.
"Well, it's this year or never. Look, under the provisions of the
original law, the exemption has been raised and the rates lowered every
year for the past nine years. It would have been shortsighted to die in
order to take advantage of any of those tax reductions, because this
year the tax is gone altogether. But the law still has its sunset
provision: It fades away on December 31, 2010, unless it's renewed. So,
given the Democratic majorities in both houses and the current deficit,
it's likely that starting January 1, 2011, the estate tax will be the
same as it was before the rates started coming down. From a tax
liability standpoint, there is no alternative to taking advantage of
this window of opportunity."
"Look, Jim," Barnett said, "Why are you in the business you're in?"
"Because the company had enormous paper losses that saved me a bundle in
taxes and the only thing it actually owned was shares in some airliners
that we depreciated the hell out of before we fobbed them off on some
bush airline in Central America."
"And why do you drive the vehicle you drive, even though the dozer
attachment makes it difficult to park in any space smaller than the
Wal-Mart parking lot?"
"Because we can write it off as farm equipment, of course," Pierson
"This is my point," Barnett said. "You've always run your life according
to what makes sense from a tax-liability standpoint. You have a vacation
condo in Louisiana, where you exist in what amounts to a steam bath all
summer, because it's in a development that juts out into the gulf and we
figured out how to depreciate it as a shrimp boat. You and Margaret
tried to time the birth of your children for late December to get an
extra year's deduction. You've planted a lot of weird-looking trees so
we could have your backyard declared an experimental forest and take a
$14,000 loss every year, not to mention deducting what you pay the kid
to mow the lawn. I'm just your tax consultant, Jim. But it seems to me
that if you don't take advantage of the 2010 window, you wouldn't be
"I'd be alive, of course," Pierson said. "There's that."
"But don't you see: You'd just be living for the government," Barnett
said. "Just because you live past 2010, 50 percent of your estate will
go right into Uncle Sam's pocket. What's the point?"
"Fifty percent!" Pierson blurted out--and then, before he realized what
he was saying, added, "I'd sooner die than give the government 50
"Exactly!" Barnett said.
Pierson was silent for a while. Then, his voice still tentative, he
said, "Have you been making any suggestions about method? When you said
'window of opportunity' a moment ago..."
"No, no," Barnett said. "What we're recommending is a high-quality
hunting rifle. It's dependable, easy to operate and almost certain to be
completely undamaged by the incident, so that it can be passed on in
mint condition to the heirs--who, of course, would pay absolutely no
inheritance tax on it."
"A high-quality hunting rifle would be rather expensive," Pierson said.
"I don't suppose..."
"Yes, we believe that under a loophole in a rider to the Reserve Officer
Training Act, as rewritten in 1978, we have a way to deduct it," Barnett
said, "as long as you register your cellar as an Alternate Emergency
Munitions Collection Point."
Pierson nodded his head silently, and then said, "I wouldn't imagine..."
"Yes," Bartlett said. "We believe we've figured out a way that your
heirs could depreciate the hunting rifle."
"Over ten or fifteen years?"
"Six years," Bartlett said, beaming with pride.
"Six years!" Pierson said.
"Wow!" He nodded his head again, slapped his hands on his knees, and
stood up. Then he said, with new resolution in his voice, "That settles
The Pentagon's recent decision to limit anthrax vaccine shots to those
at high risk does not address the fundamental objection to the shots,
which is the lack of informed consent. The military maintains that it is
not required to seek informed consent for the vaccine because it is
currently approved by the Food and Drug Administration, and it continues
to court-martial personnel who refuse the vaccine. These servicemembers
contend that the vaccine is unsafe and that the military is not using it
in the prescribed manner.
The Pentagon announced its controversial plan to forcibly inoculate all
2.4 million troops against anthrax in 1997. Almost immediately, military
members began to protest, based in part on the revelation that
approximately 300,000 servicemembers had been given experimental drugs
without their knowledge in the Gulf War. Both during and after the Gulf
War, many military personnel experienced systemic medical problems,
which are often collectively termed Gulf War Syndrome. Seven years after
the Gulf War, the military finally admitted that it had used
experimental drugs on its personnel without their consent, and that
these drugs could be factors in the medical problems.
The FDA approved the current anthrax vaccine in 1970 primarily for
agricultural workers, but not for routine immunization on large
populations. Originally approved for a six-shot, eighteen-month
protocol, the vaccine is intended to treat cutaneous (through the skin)
anthrax, but has never been tested for inhalation anthrax, which is the
most deadly form and the most likely to occur in a combat situation.
Despite the military's assertions that very few adverse reactions have
been reported from the vaccine, the General Accounting Office found that
the Pentagon has been negligent in tracking such reactions. In fact,
many military personnel have reported adverse reactions. In 2000 the GAO
surveyed the National Guard and reserve forces given the vaccine, and 85
percent reported some reactions, with 23.8 percent reported to be
systemic. Additionally, the GAO reports that the long-term effects of
the anthrax vaccine have never been studied. In 1994 one of the Army's
top biological researchers wrote that "the current vaccine against
anthrax is unsatisfactory."
In 1996 the manufacturer BioPort submitted an application to the FDA to
amend the original anthrax vaccine license to include treatment of
inhalation anthrax as an approved use, as well as an approved reduction
in the vaccination schedule. FDA regulations specify that should an
organization desire a license change for a previously approved drug or a
modified dosing schedule, the drug essentially reverts to experimental
status. Due to a vaccine shortage, the military does not require that
personnel complete the six-shot protocol, and in some cases it has
prescribed that only two of the six required shots are necessary. So
under the current law, the military, in using the anthrax vaccine as a
prophylactic against inhalation anthrax, is basically using an
experimental drug on its own people without their consent.
In light of the Gulf War experimental drug abuses, the Pentagon's
circumvention of FDA regulations with anthrax vaccine is very
unsettling. Even after the anthrax scare post-9/11, we cannot simply
ignore the system of checks and balances for experimental drugs. In
volunteering for service, military members sacrifice much for their
country. Just as they are expected to conform to the rules of their
superiors, the Pentagon should be expected to obey the laws of the
Big Pharma tries out First World drugs on unsuspecting Third World
The EPA cites chapter, and some verse,
To show this warming's making matters worse.
It's getting worse no matter how you score it.
So here's the plan: They think we should ignore it.
Minnesota can be considered a veritable mecca for insurgent third parties. Its governor is maverick independent Jesse Ventura.
Speech to The Democratic National Committee--Western Caucus
Saturday, May 25, 2002
"Death Star," "Get Shorty," "Fat Boy"--the revelation of Enron's trading
schemes in California have turned the Enron scandals virulent again.
Just when the White House thought the disease was in remission and
relegated to the business pages, the California scams exposed more of a
still-metastasizing cancer of corporate corruption.
Internal Enron memos reveal that it and other companies preyed on
California's energy crisis, helping to manufacture shortages and using
sham trades to drive up prices. The somnambulant Federal Energy
Regulatory Commission (FERC)--headed by Pat Wood III, "Kenny Boy" Lay's
handpicked chairman--decided that its initial finding of no market
manipulation in California was inoperable and opened a broader
investigation. With stocks plummeting and lawsuits piling up, CEOs at
Dynegy and CMS Energy resigned, as did heads of trading at Reliant
Resources and CMS.
The Bush Administration was directly implicated as the White House's
Enron stonewall began to collapse. A reluctant Joseph Lieberman,
chairman of the Senate Governmental Affairs Committee, finally got
sufficient spine to issue subpoenas, stimulating the White House to
release more documents about its contacts with Enron. These showed that
the White House had lied to House investigators when it reported only
six contacts between Enron officials and the White House energy task
force. The incomplete White House submissions now admit four times that
number, with more surely to come.
Lay and the Enron executives were pressing Vice President Cheney not
only to influence the President's energy policy but also to oppose price
controls on electricity in California, even as they were gaming the
market. Cheney and Bush responded to their leading contributor by
publicly scorning price controls, while White House aides encouraged the
energy industry to organize an ad campaign in California against
controls. Cheney surely felt comfortable with Enron's shady side: As we
recently learned, when he was CEO of Halliburton and its profits were
declining, his accountants--the ubiquitous Arthur Andersen--suddenly
started counting as revenue a portion of payments that were in dispute,
without informing investors of the change.
The Administration has painted Enron as a business, not a political,
scandal. Now it is apparent that the scandal is political and
economic, showing the problems of a system with too little
accountability and too much corporate influence both in the White House
and on Capitol Hill. And with the United States having to import more
than $1 billion a day in capital to cover trade deficits, the scandals
are already a drag on investment, growth and jobs.
Neither the Administration, Congress nor the business lobby has yet
awakened to the perils. Bush retains as Army Secretary former Enron
executive Tom White, who claims no knowledge that his subsidiary was
involved in the sham trading schemes (although his own bonuses were
undoubtedly based in part on the inflated revenues that resulted). Big
Five accounting firms lobbyist Harvey Pitt remains head of the SEC, even
after repeatedly traducing elementary ethics by meeting privately with
representatives of companies under investigation by his agency. Wood
remains the head of FERC, even as legislators call on him to recuse
himself from the California investigation. Bush and House Republicans
continue to resist sensible reforms. The business and accounting lobby,
in a victory of ideology over common sense, has mobilized against
anything with teeth.
Beltway conventional wisdom dismisses the political fallout of the Enron
scandals. But Americans are furious at executives who betray their
workers and mislead small investors while plundering their companies.
Thus far their anger hasn't fixed on Washington, but it may if no one is
held accountable. It's long past time for Senate Democrats to rouse
themselves, demand the heads of White and Pitt and launch a scorching
public investigation of the Administration's complicity with Enron in
California and elsewhere. Any real reform will require displacing Enron
conservatives, with their mantra of "self-regulation" and their corrupt
politics of money. With the revelations continuing and elections coming
up, progressives should be mobilizing independently to name names,
exposing those who shield the powerful. If voters learn who the culprits
are, Enron may end up reflecting the "genius" not of capitalism but of
democracy--the people's ability to clean out the stables when the stench
gets too foul.
During the long months of post-September 11 presidential invincibility,
no member of Congress climbed further out on the what-did-Bush-know-when
limb than Representative Cynthia McKinney. "We know there were numerous
warnings of the events to come on September 11," the Georgia Democrat
said in March. "What did this Administration know and when did it know
it, about the events of September 11? Who else knew, and why did they
not warn the innocent people of New York who were needlessly murdered?"
The disclosure that President Bush was warned in August that Al Qaeda
was seeking to hijack domestic aircraft did not confirm all McKinney's
intimations--which extended to talk about how the Bush family might have
profited from the attacks. Yet she was freed to stake a claim of
vindication. "It now becomes clear why the Bush Administration has been
vigorously opposing Congressional hearings. The Bush Administration has
been engaged in a conspiracy of silence. If committed and patriotic
people had not been pushing for disclosure, today's revelations would
have been hidden by the White House."
McKinney's initial calls for an investigation of what Bush knew prompted
a storm of criticism. "McKinney has made herself too easy a target for
mockery," Atlanta Journal-Constitution editorial page editor
Cynthia Tucker announced in April. "She no longer deserves serious
analysis." After Bush aides condemned McKinney's "ludicrous, baseless
views," National Review Online editor Jonah Goldberg diagnosed
her as suffering from "paranoid, America-hating, crypto-Marxist
conspiratorial delusions." Barely a month after the McKinney-bashing
peaked, however, the Journal-Constitution headline read: "Bush
warned by US intelligence before 9/11 of possible bin Laden plot to
hijack planes," while Senate Intelligence Committee vice chairman
Richard Shelby, an Alabama Republican, said, "I believe, and others
believe, if [information on threats] had been acted on properly, we may
have had a different situation on September 11."
There were no apologies to McKinney. Brushing aside complaints from
Atlanta civil rights activists, Georgia Senator Zell Miller continued to
characterize his fellow Democrat as "loony." McKinney's critics kept
exploiting the opening she gave them with her unfounded rumination on
the prospect that something other than ineptness might explain the
Administration's failure to warn Americans about terrorist threats. But
her willingness to go after the Administration when few Democrats dared
earned her folk-hero status among dissenters from the
Bush-can-do-no-wrong mantra: The popular democrats.com website now
greets visitors with a We Believe Cynthia icon.
In Georgia, where McKinney faces a July primary challenge from a former
judge who labels her "off-the-wall and unproductive," a recent
Journal-Constitution headline read, "Revelations Give Boost to
McKinney." Letters to the editor, even from former critics, hail her
prescience. And Georgia Democratic Representative John Lewis, who once
steered clear of McKinney's call for an investigation, says, "I hate to
put it in this vein, but she may have the last laugh."
Quick, pinch me--am I still living in the same country? Reading and
watching the same media? This "Bob Woodward" fellow who co-wrote a tough
piece in the May 18 Washington Post demonstrating that the
now-famous August 6 presidential daily briefing, contrary to
Administration officials' claims about its contents, actually carried
the heading "Bin Laden determined to strike in U.S."--is this the same
Bob Woodward who co-wrote the Post's infamous "Ten Days in
September" series earlier this year, the ur-document of George W. Bush's
Churchillization? And this "Michael Isikoff," sharing a byline on the
eye-opening May 27 Newsweek cover story that shreds the
Administration's "we did everything we could" line of defense--is this
the Isikoff who four years ago defined national security in terms of
dress stains and cigar probes? One begins to suspect that unbeknownst to
all of us, the terrorists have indeed struck--the Washington, DC, water
An overstatement, to be sure. But it does seem to be the case that
wherever this potentially incendiary story leads, from fog of
unprovables to hot smoking gun, one change has already taken place
because of it that is well worth marking. For the first time since
September 11--or, arguably, since ever--the press corps appears ready to
expend more effort poking holes in the vaunted Bush Administration spin
operation than admiringly limning it. More to the point, Is a new
skepticism stirring around such heretofore Teflonized officials as
National Security Adviser Condoleezza Rice? Before her May 16
damage-control press conference, Rice was probably the Administration's
leading untouchable. After it ("I don't think anybody could have
predicted these people would...use an airplane as a missile," a
statement left bleeding on the floor after a pile of evidence came
forward showing plenty of people were predicting precisely that), her
status has taken a major hit. So, as Professor Harold Hill might put it,
certain wooorrrrdds are creeping into the media vocabulary--words
like "serious credibility gap," in the Newsweek piece.
It's been a long time coming. If anything "un-American" happened after
September 11, it was the triumph of the notion--propounded by the
Bushies, reinforced by the major media and far too readily accepted by
cowardly Democrats--that "patriotism" somehow equals "support the Bush
Administration." CBS's Dan Rather said it recently in an interview with
the BBC: "Patriotism became so strong in the United States after 11
September that it prevented US journalists from asking the toughest of
the tough questions about the war against terrorism," adding, "I do not
except myself from this criticism." The genuflection sometimes reached
levels that we might call comic, except that there's nothing comic about
a "free" press choosing to ape state-owned media, throwing rose petals
at the feet of officials from the most unilateral and secretive
Administration in modern American history ("sixty-nine years old, and
you're America's stud," Meet the Press's Tim Russert once said to
Defense Secretary Donald Rumsfeld).
One is not quite ready to say, on the evidence of several days' worth of
stories, that this sorry era is over just yet. The New York Times
and the Washington Post both ran editorials on May 17 that were
something short of being full-throated calls for investigation; from the
right-wing papers, the predictable yelping about how it's really
All this will probably continue, but at least now it appears that it
will be offset by some post-post-9/11 aggression. It will be interesting
to watch what leads the media now follow and how far they follow them.
For example, some reports--originating with the BBC but picked up in a
few minor US outlets--indicate that US intelligence agents were told to
back off the bin Laden family and the Saudi royals soon after Bush
became President. Reporters might also look into the way the
Administration declined to continue a process of tightening overseas and
offshore banking regulations begun by the Clinton Administration in an
effort to track down narcotics traffickers and terrorists. The Bush
people acted partly at the behest of Texas Senator Phil Gramm, which
means partly at the behest of Enron--and which may have ended up helping
"Connecting the dots" has become the operative cliché about
whether intelligence officials should have been able to put together the
various pre-9/11 clues they received. Now, maybe the media will start
connecting some dots of their own.
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