When Congress passed incentives in the 1990s for drilling and exploration by oil and companies supporters claimed that there would be no cost to the taxpayer. This, of course, was not the case as today’s New York Times report indicates: “the Bush administration confirmed that it expected the government to waive about $7 billion in royalties over the next five years, even though the industry incentive was expressly conceived of for times when energy prices were low. And that number could quadruple to more than $28 billion if a lawsuit filed last week challenging one of the program's remaining restrictions proves successful.” The story of how the federal government wound up providing massive taxpayer funded incentives to one of the most lucrative industries involves a bill passed by legislators riddled with ambiguities, crucial errors by midlevel bureaucrats under President Bill Clinton, a Bush administration seeking greater incentives for the oil and gas industry, and “Republican lawmakers who wanted to do even more.” While the Clinton administration missteps appear to be “a massive screw-up,” according to a former Energy Department official, the Bush administration has continuously sought to provide as many incentives to the oil and gas industry as possible. President George W. Bush is the largest recipient of campaign cash from the oil and gas industry, with totals topping $4.5 million. Recently resigned Interior Secretary Gale Norton, a major proponent of incentives to the oil and gas industry, founded a non-profit before she joined Bush’s cabinet, the Council for Republican Environmental Advocacy, which is heavily funded by oil and gas, mining, and logging interests.
The World of Congressional Earmarking:
The Washington Post delves into the world of Congressional earmarking where it is completely ethical for lawmakers to suggest that groups hire lobbyists and the lobbyists, after winning contracts for their clients, donate money to the lawmaker’s campaign fund. One group, Students for Free Enterprise, talked to Rep. Roy Blunt (R-MO) about getting federal funding for their organization, which included a student exchange program. Blunt suggested that they hire a lobbyist, so they hired Blunt’s former chief of staff Gregg Hartley. The group paid Hartley $80,000 and won $750,000 to “expand their headquarters” and $250,000 for the student exchange program. Rep. Tom Reynolds (R-NY) suggested some lobbying firms to a defense contractor back in 2001. This year the company received a $1.5 million earmark and Reynolds received $6,000 from the lobbying firm he suggested that they hire. The article is full of similar stories of lawmakers, including Rahm Emanuel (D-IL) and Vern Ehlers (R-MI), suggesting lobbyists, writing earmarks, and receiving campaign contributions.
Continue readingMore News:
- Roll Call reports that “Despite public and private assurances by Senate Rules and Administration Chairman Trent Lott (R-Miss.), the Senate may not be able to wrap up work on the lobbying reform legislation it is preparing to take up today.”
- “Reps. Doc Hastings (R-Wash.) and Alan Mollohan (D-W.Va.), the committee’s chairman and ranking member, respectively, met to discuss the panel’s direction shortly before the House left for the weeklong St. Patrick’s Day recess, and more talks are expected soon, GOP and Democratic sources say,” according to Roll Call. Those expected to come before the ethics committee includes Tom DeLay (R-TX), Bob Ney (R-OH), John Conyers (D-MI), Richard Pombo (R-CA), and Jim McDermott (D-WA).
- The Birmingham News reports that backers of earmarks are invoking U.S. law to show that earmarks are justified. Earmark supporters point to the U.S. Constitution Article I, Section 9 reads, “No money shall be drawn from the treasury, but in consequence of appropriations made by law,” which also means, “Congress has the right to tailor the nation's budgets as generally or as specifically as it chooses.” Spencer Bachus (R-AL) states, “Either a bureaucrat is going to make a decision how to spend it or your elected member of Congress.”
Weekend Round-up:
- Ed Buckham, the former chief of staff and religious advisor to former Majority Leader Tom DeLay (R-TX), collected over $1 million through a non-profit group created while he was still under DeLay’s employ. (Washington Post) TPM Muckraker has been following Buckham’s money trail for some time. Check out their three parts series here, here, and here.
- The founder of “compassionate conservatism” Marvin Olasky is assailing former Christian Coalition head Ralph Reed over his connections and dealings with disgraced lobbyist Jack Abramoff. (Washington Post)
- Robert Novak claims that Jack Abramoff is clearing DeLay from charges of corruption in his talks with investigators. Of course, the steady stream of stories like the Washington Post Ed Buckham story indicates that Abramoff is not the only corrupting influence on Capitol Hill. (Townhall.com)
- Laura Rozen notes that the wife of the mysterious Thommas Kontogiannis – one of the alleged bribers in the Duke Cunningham corruption case – gave “$18,000 to eighteen vulnerable Republican US House candidates” in 2004. Rozen writes, “These are not her local candidates, or broad nationally known candidates. Who was directing these payments to these obscure, vulnerable national Republican candidates? Who gave the Kontogiannis the Republican House play map? These payments suggest a degree of connection to someone far more central to the GOP House machine than even Cunningham.” (War and Piece)
What I’m Reading
American Theocracy : The Peril and Politics of Radical Religion, Oil, and Borrowed Money in the 21st Century by Kevin Phillips. If you're not already depressed about America's future, this book will hit you with a triple whammy: The Iraq invasion was all about oil, not terrorism. Fundamentalist religion is having an ever-growing influence US foreign policy. And the federal deficit is going to sink our kids if it doesn't sink us first. Well-documented and well-reasoned, which makes it even more depressing.
National Journal: The State of Lobbying:
“Lobbying is now a $2 billion-plus annual business in Washington -- and that's just the amount that can be tracked through official lobbying filings. Billions more are spent on public-relations, grassroots, and other advocacy efforts that don't have to be disclosed but are increasingly a key part of the influence industry,” according to a National Journal report on lobbying. The article provides a detailed look at attempts to reign in lobbying over the past century and a half. The Lobbying Disclosure Act of 1995 comes in for particular criticism by some lobbyists, “The LDA is a joke in some ways, because no one looks at those filings and there has been no enforcement.” In the past ten years the Justice Department has investigated only 13 violations and reached three civil settlements. Lobbyists also claim that the system in Washington is broken, due in part to the revolving door between Capitol Hill and K Street, “They cite short-term Hill staffers whose knowledge base is shallow, forcing them to rely on lobbyists for information. … Lobbyist Pete Rose … talks about a ‘broken’ system on the Hill. ‘I mourn the loss of institutional knowledge, and as a result of high staff turnover and lack of knowledge on issues there is often a lack of responsiveness.’” Stories abound of “arrogant” and “rude” congressional staffers strong-arming lobbyists into buying them meals, paying for their drinks at a bar, or demanding a party to be paid for by the lobbyist’s firm. The Journal story also provides a list of the top 25 lobbying firms and the top clients of the top 15 firms.
Continue readingMore News:
- Will Bunch reports in the Philadelphia Daily News, “A faith-based Philadelphia group at the center of a flap over whether tax-exempt religious groups are aiding the re-election campaign of U.S. Sen. Rick Santorum has won more than $250,000 in federal grant money pushed for by Santorum over the last three years.” The group, the Urban Family Council, participated in a training session held by the ad-hoc group Pennsylvania Pastors Network, “which pushed a church-based get-out-the-vote drive for November.” Santorum addressed the meeting by video and spoke about stopping same-sex marriage raising questions about the political purposes of the tax-exempt group.
- The New York Times reports on the auction of jailed ex-Rep. Duke Cunningham’s goods. The auction netted $94,625 or, “about two-thirds of the $150,000 that the military contractors who gave the items to Mr. Cunningham as bribes reportedly paid for them.” TPM Muckraker has the full list of items and what they sold for in their document collection. The San Diego Union-Tribune has the pictures of the auction that even includes bidding paddles with the face of Comedy Central’s Stephen Colbert glued on.
- Adam Kidan and Jack Abramoff will be subpoenaed by the defense in the Gus Boulis murder case, according to the South Florida Sun-Sentinel. In 2001, Boulis was ambushed and slain in his car following a bitter, months-long sale of his SunCruz casino lines to Kidan and Abramoff. Anthony Moscatiello and two associates, hired to provide security for the casino boat line, were indicted in Boulis’ murder last year. Moscatiello was hired by Kidan and Kidan “has not been eliminated as a suspect in the murder case”.
- The Washington Post looks deeper into the activities of MZM and Duke Cunningham as the Pentagon prepares to look for earmarks that Cunningham may have written for MZM:
"…prosecutors said that in fiscal 2003 legislation, the congressman, who was a member of the House Permanent Select Committee on Intelligence, set aside, or earmarked, $6.3 million for work to be done ‘to benefit’ the Counterintelligence Field Activity (CIFA), created in 2002. …
In 2004, three MZM employees served as staff consultants to the presidential commission investigating prewar Iraq intelligence, which was run by federal Judge Laurence H. Silberman and former senator Charles S. Robb (D-Va.). One of the three was retired Lt. Gen. James C. King, who then was a senior vice president of MZM for national security. King, who before joining MZM had been director of the National Imagery and Mapping Agency, played a consultant's role in the establishment of CIFA in 2002 before MZM received its first contracts from that agency.
The Silberman-Robb commission report in 2005 recommended that CIFA play a bigger role in the government's counterterrorism activities.”
Silberman denies that King and the other two MZM employees played any role in recommending a bigger role for CIFA.
- MSNBC reports that Abramoff associate David Safavian is headed to court today for a pretrial hearing.
- The Christian Science Monitor provides yet another story that ethics reform is stalling in Congress. Norm Ornstein says, “Some members are pulling the blanket over their heads and hoping the storm will pass. For others, there is also a genuine belief that if you just jump in a spasm of reaction, you could do some things detrimental to a good deliberative process.”
Former USAID Official Blows Whistle on Iraq Fraud:
The former head USAID Andrew Natsios, interviewed in Newsweek, claims that the Coalition Provisional Authority, which ruled Iraq after Saddam’s fall, was not prepared for the rebuilding of Iraq and let “ill-qualified or corrupt contractors” dominate the rebuilding process. “They didn't have [monitoring] systems set up. They were very dismissive of these processes,” he stated. Others are speaking out on contractor fraud and corruption including the watchdog group Transparency International, which claimed that the contractor fraud could become “the biggest corruption scandal in history.” Rep. Chris Shays (R-CT), who has investigated fraud allegations states, “The administration seems to have a deaf ear to this issue … When you have men and women dying on the battlefield and you have corruption, then you've got a problem.” The Defense Department refused to send auditors to Iraq until numerous pleas and corrupt practices brought them to send a team to Qatar, a thousand miles away from Baghdad. The Inspector General at the Pentagon oversaw the auditing practice of rewarding and monitoring contracts – until he left his position to take a job with Blackwater USA, one of the top Pentagon contractors in Iraq.
Continue readingSale of War Firm Makes Millions for Presidential Uncle:
President Bush’s uncle William Bush collected $2.7 million in cash and stocks in the sale of the war contracting firm ESSI to DRS Technologies, according to the Los Angeles Times. ESSI received hundreds of millions of dollars in contracts for operations in Iraq, many of them no-bid, and is currently involved in two federal investigations according to the SEC. One of the investigations revolves around a delayed disclosure to stockholders of a stop-order put on a contract. During the delay “several ESSI executives, including Bush's uncle, cashed in stock and stock options worth millions of dollars”.
Continue readingMore News:
- The New Orleans Times-Picayune reports that the investigation into the bribery allegations against Rep. William Jefferson (D-LA) is moving along as a Virginia court has subpoenaed records from “a law firm where one of the congressman's daughters once worked”. The judge also delayed the sentencing of Jefferson’s former aide Brent Pfeffer, who pleaded guilty to “aiding and abetting the solicitation of bribes” and implicated Jefferson as demanding bribes from technology firms.
- According to the Associated Press, Rep. Russ Carnahan (D-MO) and the Missouri House Democratic Congressional Committee are being fined for “various campaign finance violations.” The State Ethics commission found that the committee “failed to file proper financial reports and mixed money with another campaign committee” during the 2002 campaign and the Carnahan “signed checks for the committee that he wasn't authorized to.”
- Barbara Bush’s donation to the Bush-Clinton Katrina Fund was earmarked for her son Neil’s technology firm Ignite!, according to the Houston Chronicle.
- Senator Ted Stevens (R-AK) is warning his constituents that earmarks are under attack and that Alaska risks losing its share of federal money, according to the Associated Press.
- Bloomberg reports on the attempt to attach 527-reform to the lobbying and ethics reform legislation.
- Patt Morrison of the Los Angeles Times goes down to the Duke Cunningham auction and exposes what Cunningham bought with all of that dirty money. Morrison is disappointed: “You sell out your career, your reputation and your freedom, and this is your asking price?”
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