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Anti bribery, Halliburton, Murdoch anti investigation

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Anti bribery?

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Secretary of State Colin L. Powell

The late years of the Clinton administration produced an anti-corruption inspection that could have been advantageous to United States interests, if the George W. Bush administration had not discontinued it when Colin Powell was replaced as Secretary of State by Condoleezza Rice.

In 1999-2000, the U.S. State Department began publishing an annual report on international bribery. Titled Battling International Bribery, it came out six times, ceasing in 2004. As Secretary of State Colin Powell noted in the release accompanying the 2001 publication, the report

“analyses the implementing legislation of seven of the countries that have ratified the [Organisation for Economic Co-operation and Development] Convention since our 2000 report and updates the information on 21 other Parties to the Convention. The report also provides updated information on enforcement of the Convention, measures taken by the signatories to end the tax deductibility of bribes, areas where the Convention might be strengthened, and efforts at encouraging additional non-OECD key exporting states to join the Convention.” [emphasis added]

OECD bribery awareness handbook for tax examiners

The U.S. ratified the OECD Convention against bribery in 1998 and, as said, began publishing its annual track-down, within scrupulously detailed limits, the next year.

Bush’s first Secretary of State supported the endeavor. In his 2001 statement, Powell noted that

“The OECD Convention represents a key element in the Administration’s wider campaign to combat corruption and promote fair competition. The United States initiated and hosted the first of a series of Global Forums on Fighting Corruption. The first was held in Washington, D.C. in February 1999, and the Second Global Forum, held in the Netherlands in May 2001, was co-sponsored by the United States. These meetings have placed a strong emphasis on combating corruption in the public service. In our own hemisphere, the United States and over 20 other nations have ratified the Inter-American Convention Against Corruption, which was negotiated under the auspices of the Organization of American States in 1996.”

The anti-bribery Convention seems to have shown hopeful signs of progress. Seven countries ratified it from 2000 to 2001; by the 2003 report, 35 countries had ratified it; as of the 2004 report, Ireland had joined the list.

An early question that leaps to mind is why, why, any such beneficial endeavor would be discontinued. Perhaps a clue can be found in the public release:

“Another import part of this [anti-bribery] strategy is to reach out to American companies and business associations to make them better aware of the international anticorruption environment. In May 2001, the Departmetn of State, in cooperation with the Commerce and Justice Departments, published a new edition of our brochure titled Fighting Global corruption: Business Risk Management. This booklet contains information about the benefits of strong corporate antibribery policies and gives guidance to businesses on the requirements of U.S. law and the OECD Convention.”

Powell included a reminder, or hint, in his foreword to the brochure:

“Since the enactment of the Foreign Corrupt Practices Act of 1977, the United States has provided indispensable leadership so that business enterprise can compete fairly in the global economy. Today, rule of law and anticorruption initiatives are key foreign policy elements that promote integrity and confidence in both government institutions and in the global marketplace.”

 

Nigeria rounds up HAL employees in bribery investigation

The 2001 statement continues further hints:

“Our review of the legislation of the 27 foreign countries in this report indicates that most Parties have taken effective steps to make bribery of foreign public officials illegal under their domestic law. We believe, however, that the laws of some countries fall short of the Convention’s requirements. We are also disturbed by continuing reports of alleged bribery of foreign public officials by firms based in countries for which the Convention is in force. We will continue both bilaterally and in the OECD to urge these countries to remedy these legislative and enforcement deficiencies. All signatories have an interest in ensuring that all Parties vigorously implement and enforce the Convention.” [emphasis added]

Out of Africa

Regrettably, the list of ratifying OECD nations did not include Nigeria. It still does not, to this day.

If the OECD Convention was not operating in Nigeria, however, Halliburton was; Nigeria has copious oil and natural gas resources. And as most Americans know, or anyway Americans who get their news from other sources in addition to corporate media outlets, the words “Halliburton,” “bribery,” and “Nigeria” have been significantly joined for several years now.

Now let’s put our thinking caps on. Who, in public life, was connected to Halliburton around the time of the second Bush administration? Who?

Dick Cheney

Details of the years of U.S. investigation and non-investigation of Halliburton’s practices in Nigeria are beyond the scope of one article. Suffice it to say that investigation moved slowly under the Bush administration, and that a number of Bush officials successfully ‘burrowed’ in the departments of State, Justice and Commerce before the inauguration of President Obama. Some matters under federal investigation were resolved early on, under the new administration—very early, as the company moved swiftly in the post-election period to avoid worse problems down the road.

Previously, under the Bush administration, Halliburton sent an interesting little cache of documents to an unknown contract worker by mistake.

The Washington-type high-grade office temp was David A. Smith, a northern Virginian by way of West Virginia and Harvard, who worked at Halliburton subsidiary KBR. What Smith received perturbed him so much that he took the trouble to become a Halliburton (HAL) shareholder, on a small scale, better to communicate with the company and the Securities & Exchange Commission. As he notified the SEC in a filing Sept. 21, 2006,

“I worked at Halliburton’s Kellogg, Brown & Root offices in Arlington, Virginia from August 2001 (just before the September 11th attacks) until April 2003 (just after we went to war in Iraq). Needless to say, this was a very interesting time to be in the belly of the war machine beast. I worked in the Government Proposals group, responding to Federal, State, and local requests for proposals. The proposal responses I worked on included the logistics support contracts for Iraqi operations (LOGCAP III), Iraqi oilfield reconstruction (RIO), embassy security upgrades and rebuilding (e.g., the Afghan embassy re-build project), nuclear non-proliferation (DTRA CTRIC), and other crucial projects.”

A hot set of topics, it would seem, and from the point of view of HAL probably ill coupled with any investigation of bribery, anywhere. While working in this setting, Smith goes on, “I received a series of mis-directed e-mails intended for David R. Smith, the Vice President of Tax for Halliburton . . . These e-mails pertained to the as-yet-unannounced Federal investigations into bribery and public corruption charges in Halliburton’s Nigerian operations.”

The back-story to the emails is likewise interesting:

“One day, the entire Proposals Group was summoned to a meeting that lasted quite a while (a couple of hours at least). When I returned to my desk after that meeting, I was surprised to discover that my corporate e-mail inbox was overflowing with new messages.”

“’That’s odd,’ I thought. ‘Everyone who would have been e-mailing me was in that meeting’.”

“Scrolling through the e-mails, I discovered that I was on the ‘cc: list’ – along with many others inside and outside the company – for the original e-mail. The other e-mails cluttering my inbox were the ‘Reply to All’ responses that some of the other ‘cc: list’ recipients had made in response to the original e-mail.”

‘The original e-mail should have been sent to David R. Smith–the Vice President of Tax for Halliburton, appointed to that role during Vice President Dick Cheney’s tenure as CEO […] See also the insider trade filings for the other David Smith, at the SEC’s EDGAR website.”

“The Halliburton attorney who authored the original e-mail chose the first David Smith in the internal address book by mistake (I surmise he was thinking hierarchically, rather than alphabetically). Alphabetically, the first David Smith in the address book (and there were several of us with that common name who worked for the company) was me: David A. Smith. I guess the Halliburton attorney’s kindergarten teacher didn’t teach him his alphabet; mine did.”

“As I scrolled through the responses, it became clear that the subject under discussion was certain projects Halliburton was seeking to undertake in Nigeria, including a liquefied natural gas (LNG) plant. So far, the e-mails pertained to my job function, and I continued to scan them for whatever specific action item(s) I was being asked to perform. It was not uncommon for my proposal group to work with our counterparts in overseas offices, to produce key personnel curriculum vitae, past project write-ups, etc.”

Then the plot, as they say, thickened:

“However, it quickly became clear that something was wrong. The e-mails centered around how to defend the company from a Federal investigation that the Houston home office had just learned about, arising under the Foreign Corrupt Practices Act. Intrigued – I am a policy wonk and [Sen. Robert] Byrd Scholar after all–I began to read the e-mails more carefully. As I did, it became apparent that the responses I had mistakenly received were from the company’s entire ‘damage control fire brigade’: the public relations flaks were weighing in on how to spin the investigation, should it become public knowledge. The attorneys (both in-house and external) were weighing in on how to mount a legal defense, and how to keep the DOJ and SEC thrown off the scent. Government Relations personnel were weighing in on how to call in favors from the Executive Office of the President–including specific mention of making contact with the Vice President’s office.” [emphasis added]

“Aghast, I continued to search the e-mails for the specific action I was being asked to undertake. ‘Why has this correspondence been sent to me?’ I kept wondering.”

“The answer soon became clear. The other David Smith–VP of Tax at Halliburton–was being asked to weigh in on how to explain away the source of the bribes paid to Nigerian officials. After all, a dirty foreign bribe is usually paid with dirty, offshore, untaxed money, right?”

 

Feeling a trifle vulnerable, Smith nevertheless did not drop the matter:

“I approached my supervisor with my problem. He said that I should just ignore them. I protested, pointing out that my silence might be misconstrued, and land me in hot water. Mulling it over, he told me to go ahead and alert the original sender. (As an aside, it was not uncommon for me to receive mis-directed e-mails–intended for one of the other David Smiths in the company – but they usually were either benign, or at worst, a dirty joke.)”

“When I alerted the original sender (the Halliburton attorney), he fired back an angry e-mail, ordering me to destroy all copies of the e-mails I had received, and to send him a signed written letter to the effect that I had done so. Rather than thanking me for proactively (and quietly) alerting him to his mistake, he essentially ‘shot the messenger’–acting as if I were the one who had done something wrong.”

This writer met Smith and his partner in Northern Virginia, after he got in touch—frustrated at some lack of investigation and reporting—and interviewed him at some length. Without going into full detail, Smith clarified that he had taken steps to protect the emails.

There were the beginnings of an investigation in those years. Smith’s message to the SEC continues,

“In late July 2004, I received a phone call from Mr. Peter Clark, the Deputy Chief of the Fraud Section of the Criminal Division of the Department of Justice. He informed me that another U.S. Attorney was on the line with him, along with two FBI agents from the Houston Field Office. He asked if he could record the conversation. I agreed.”

(For the record, Smith also suspects that Peter Clark may have been one of the name-redacted Justice Dept attorneys slated for firing, back when.)

“At Mr. Clark’s request, I recounted the information above. […] I explained to Mr. Clark that the young man who maintained Halliburton’s e-mail backups for the Arlington, Virginia office could surely produce copies [of the e-mails] directly from the company’s own storage system, and also pointed out that the e-mails that would be of most interest to the ongoing FCPA investigation would be those e-mails that were exchanged by the damage control fire brigade after the correct David Smith was looped in (e.g., what did the Tax group down in Houston have to say about how to spin the dirty bribe money’s tax status and offshore source?). Excitedly, Mr. Clark rang off, promising to call with further updates.”

“Later that same day–much to my surprise–he did just that. He informed me that following the morning phone call, FBI agents showed up in both Arlington, Virginia and Houston, Texas, demanding copies of both my e-mail account’s backups, and the other David Smith’s. [emphasis added]

Unfortunately if unsurprisingly, the investigation went nowhere. David A. Smith was not forbidden to share his information with others, but with some regret he chose not to go public at the time, getting in touch with authorities and with journalists later. The actions of Halliburton in Nigeria were consistently under-reported.

Halliburton to settle Nigerian bribery allegations with fines

Going forward with recently added hindsight, it would be only reasonable to follow up on entities and individuals benefiting from the cessation of State’s bribery report. Up top, we have Halliburton and its subsidiaries and spin-offs. Farther afield from the oil industry, we have Rupert Murdoch and his media empire.

 

Murdochs, News Corp face questions

More later

 

 

Note: Parts of this article were previously published under the tongue-in-cheek title “The importance of being earnest at Halliburton.” No major newspaper during the Bush years got in touch with David Smith, whose information still sounds relevant.

It was never about the debt ceiling

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It was never about the debt ceiling

What a time for my domain to become live again, just when Congress leaves town after finalizing a rise in the ‘debt ceiling.’

There will be several parts to this post.

First, to some of the more sweeping or superficial distortions and debt-ceiling politics:

  •  On balance, I think the Democrats in Congress, the White House, and the public came out better—given the situation–than has been indicated by some progressive outlets. Admittedly I am influenced by the fact that some of the most vitriolic ‘progressive’ voices against Dems and the WH are also corporate-allied. They do tend to get all rabble-rousing in the abstract, simultaneously resisting options to help improve the lot of working people (such as writers) themselves. They also tend not to be very effective, politically speaking. They also tend to have dismissed candidate Obama’s chance of winning early. So in a sense it is natural for them to lob attacks on the president, rather than fight 1) against the GOP corpo-party and 2) for working people. That aside, the final bill avoided default (more on default later); prohibited another debt-ceiling ruse for the next couple of years; and kept the GOP on the hook for its program cuts, government spending, and tax favoritism for the wealthy and corporations.
  • That last item is so significant that I have been a little surprised to see it so neglected in political commentary over the last few days. The lift on the debt ceiling was passed by Republicans in the House.
  • Let me repeat that: After all the hoopla about the Tea Party, a ‘rift’ or schism in the GOP, threats to John Boehner’s position as Speaker, etc., etc., the bill raising the debt ceiling was passed by Republicans in the House. The bill was supported by more Republicans than Democrats, with 174 Republicans voting to raise the debt ceiling and 95 Democrats. The bill was opposed by more Democrats than Republicans, with 95 Dems voting against it and only 66 GOPers.
  • Our political reporters have not highlighted this fact. While the final tally pretty much had to be reported, the party break-down is being spun so far as a revolt against the president in Democratic ranks; or as a sign of weakness for Dems/WH; or as a sticking point for progressives re 2012; etc. (Again the refrain: So much for the liberal media.)
  • Even in the Senate, where the bill passed 74-26 and more Democrats voted for it, more Republicans voted for it (28) than opposed it (19).
  • Btw, one factoid sheds some light on the supposed popularity of opposing, or rebelling, or shaking things up, re those Republican primaries. Of the 19 Republican senators who voted not to raise the debt ceiling, 13 are not up for re-election until 2016. Four are not up for re-election until 2014. Every GOPer up for election in 2010 voted to raise the debt ceiling, except Hatch (R-Utah) and Heller (R-Nev.). Theoretically Hatch and Heller know the electorates of their states best. In any case, the final vote tally casts some doubt on the much-vaunted electoral clout of the Tea Party, at least measured against the importance of Wall Street contributions.
  • Any Dem running for Congress who allows himself to be put on the defensive about ‘gummint spending’ after this deserves to lose.

 

The bigger distortions are misrepresentations on a more fundamental level. Some of the deeper issues go to the heart of political reporting in large media outlets:

  •  This fight in Congress was never about the debt ceiling. With the exception of a few Tea Party members, mainly from South Carolina, who were genuinely ready to become defaulters, the GOP in both House and Senate has repeatedly voted in the past to raise the debt ceiling, under both Republican and Democratic presidents, or to vote no only in a symbolic gesture after it was already clear that it would be raised. Every member of Congress had access to former Federal Reserve Chairman Alan Greenspan’s remarks on the debt ceiling, including Greenspan’s call for eliminating the debt ceiling. (Yes, the right wing distrusts the Fed. That doesn’t mean they mistake Greenspan for Greenpeace.) Every experienced Congress member knows that, as the president said, raising the debt ceiling simply allows the U.S. “to pay its bills on time, as we always have.”
  • The fight from Republicans in Congress was never about reducing the deficit. As President Obama said earlier, “There’s nothing serious about a plan that claims to reduce the deficit by spending a trillion dollars on tax cuts for millionaires and billionaires.” The congressional GOP could have attempted what Sen. Tom Coburn (R-Okla.) is attempting, to find genuine examples of waste, fraud and abuse to cut. It could have voted—for the past thirty years—to trim military spending, reining in federal contractors. It could have eliminated tax breaks, unneeded by any measure, for Big Oil. It could have voted against the Iraq War. It could have reined in the intelligence establishment, which failed to prevent 9/11 and was rewarded for failure by more far-flung billions than ever, with the massive additional layer of bureaucracy known as the Department of Homeland Security. Congress could even have opted to run itself more frugally.

  • Instead, the Republican apparatus in government has worked, often behind the scenes, to drive up the cost of government more, regardless of the wishes of ordinary Republican voters. Every delay in Congress adds to the cost of government—added on top of other damage done in delaying needed legislation (the FAA is a prime example). Every delay in confirming judges and other federal appointees adds to the cost of running the agencies involved, and this GOP has delayed judicial confirmations and backlogged the courts more than any other party in U.S. history. The delay in raising the debt ceiling alone cost U.S. taxpayers billions. Furthermore, top GOPers have resisted efforts to make large federal contracts (mainly in military-security spending) more competitive, sometimes while simultaneously resisting efforts to exempt small contracts from competition. All this, of course, comes on top of the massive trillion-dollar hole of two wars and tax breaks for the wealthy and corporations, all funneled into effect by the GOP with some acquiescent Democrats.
  • The fight was never over the national debt. What GOPer has seriously called (publicly) for refusing to pay the interest, let alone the principle, on U.S. Savings Bonds bought by Americans or by other people? Come to think of it, what Republican in office has mentioned U.S. Savings Bonds recently?

  • Conclusory statement: Regardless of ‘red-meat’ campaign rhetoric, the GOP in office never strays far from the Wall Street fold. If you really want to analyze current GOP politics you can forget guns, god and gays.
  • Second conclusory statement: Regardless of ‘the base,’ the middle class, or the rest of the electorate, Republican policy in office is about using the power of office to break the middle class. GOP honchos have tried to replace Social Security; they are trying to weaken Medicare and Medicaid, using Orwellianisms the while; they fought tooth and nail to prevent enlightened single-payer health coverage and to keep insurance companies the gatekeepers for health care. For three decades they have boosted corporate efforts to undermine pension plans. They support every corporate effort to jettison pensions and health benefits. Their financial policy, if you call it that, enabled the mortgage-derivatives industry to damage trillions of dollars worth of pension security. They support easy bankruptcy for corporations and impose stringent bankruptcy standards on the unemployed. They oppose every effort toward accountability and transparency (‘regulation’) in both government and corporate bureaucracies. They oppose every effort to protect ordinary people’s ability to seek redress for harm, harm up to and including death, in our taxpayer-funded courts. The strategy is to reduce the clout of the middle class—i.e. the bottom 90 percent of the population, as Inside Job puts it—and to make most of the population ever more dependent on the few. And when individual GOP congress members interrupt the over-all strategy on some particular legislation, they lose. The one exception to this big-picture GOP rule in his own way, the one congressional Republican who opposed the invasion of Iraq, Rep. Ron Paul (R-Tex.), is retiring from Congress.

All of this has passed largely unreported in the same news media that also missed (among other things) the lead-up to the Iraq War, the bubble and bust in the real estate boom, and the impending crisis in the mortgage-derivatives industry.

 

Thought for the week, passed along from Local 2336 of Communications Workers of America (CWA): “Do you remember when teachers, public employees, Planned Parenthood, NPR and PBS crashed the stock market, wiped out half of our 401K’s, took trillions in taxpayer funded bailouts, spilled oil in the Gulf of Mexico, gave themselves billions in bonuses and paid no taxes?  YEAH, ME NEITHER!”

 

Side note: In what is being reported as bad news financially, Americans are spending less and saving more. Setting aside if one could that that is actually good news, what did they expect after the charade over what should have been a routine rise of the debt ceiling?

Did anyone catch the language coming out of Washington last month, along with the name-calling? Debtdebtdebtdebtdebtdebtdebt . . .

 

More later

Drowning the Middle Class in the Bathtub, part 2

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Yesterday the public won one: The Senate upheld rules reining in debit card ‘swipe fees’ in the Dodd-Frank legislation passed last year.

The vote was uncomfortably close—with 54 senators voting to delay implementation of much-needed rules limiting the fees. Banks and major credit-card lenders, the same people helping drive college kids to suicide for years with unbridled credit-card marketing to young people untrained in handling debt, lobbied intensely against the bill. The fees pull in an estimated $20 billion a year for the industry, for debit-card services that cost lenders little to provide. You might remember that more people than ever are using debit rather than credit, part of the current trend toward less consumption and more saving that the public is engaged in that so threatens the GOP.

Some of the lobbying was done by Dick Armey of ‘FreedomWorks,’ a former Houston congressman who spends considerable time and energy trying to rally Tea Partiers in support of measures protecting the financial services industry. FreedomWorks gives every sign of considering the Tea Party gullible. Protecting abusive mortgage lenders, credit card lenders and other members of the financial sector from shouldering some of the burden of their own abuses is not in the public interest.

That doesn’t keep them from trying to claim it is, though. The D.C. Metro system has had large advertising signs posted for the past few weeks, urging the public not to let “big retailers” defeat our beloved credit card companies. You’d think VISA was Winnie Churchill. Following the Senate vote, banks pronounced yesterday a “dark day.” Here’s the darkness: Starting in July, swipe fees will be set at a flat rate of 12 cents per transaction. Multiply that 12 cents by billions of transactions, and the lenders still take away something that, to most people, looks like real money.

Meanwhile, Armey of FreedomWorks sent around a mass email under the subject line, “Stop Government Price Controls on Debit Cards.” More of that finish-off-the-public-once-and-for-all renaming (previously written about), but this one carries considerably less punch than renaming teachers and police ‘government jobs.’ ‘Price controls’ do not strike the same fear in a grass-roots movement with a populist tinge—too little populism, admittedly, but still it flashes out intermittently—that they strike among insurance companies, and anyway the accusation that the Obama administration or congressional Democrats are trying to implement price and wage controls the way Richard Nixon did is a bit much for anyone to swallow.

In fact, the white-collar goon squads slipped up big-time on this one. “TAKE ACTION!” Armey says in bold caps:

“Unless the law is changed, new Federal Reserve regulations will impose price controls on “interchange fees,” the price retailers pay for the ability to use debit cards. These price controls are yet another example of unnecessary government intervention that will likely result in higher fees and new restrictions on debit cards to include the end of banks issuing free debit cards and debit card reward programs.

Government bureaucrats should never be in the business of trying to set prices. The market should be allowed to operate free from government intervention in setting interchange fees.”

For one thing, this looks like an admission that swipe fees do add to consumers’ costs—“prices.” For another, this is another of those threats by the financial sector, like the insurance companies’ threat to raise their rates if health reform were implemented. Insurance companies raise their rates every year. There has not been one year in the past three decades when insurance rates did not go up. This time, the threat is that the public will lose free debit cards and debit card reward programs.

That last one is really a seriously hollow threat, as anyone who bothers to check the details of those ‘reward points’ programs can tell you. The customer has to rack up about half a million ‘reward points’ to purchase even a small item for ‘free.’ To get a ‘free’ round-trip flight to anywhere, it’s more like half a billion ‘reward points.’ This is an exaggeration, but not by much. It still takes an almost unthinkable number of purchases to get one freebie.

Quick reminder of the bigger picture here: 1) The GOP in Congress and GOP White House hopefuls are weeping crocodile tears over a federal budget deficit that their party largely created, with trillions down the drain through two wars and wasteful tax cuts for the rich and for corporations; 2) the same public figures go around saying that the federal government should balance its budget ‘the way people have to balance their household budgets,’ knowing full well that most households are surviving, if at all, partly on their mortgages, auto loans and education loans if not on other credit; 3) regardless of the wishes of individual rank-and-file members, the top party apparatus of the GOP has prevented or at least opposed every measure that might improve employment in the U.S. in the long term; 4) regardless of the wishes of individual rank-and-file party members, the same GOP apparatus has opposed every attempt to rein in abuses by the financial sector; and 5) because of that opposition, not one top executive in the industry that created the multi-trillion-dollar meltdown of mortgage derivatives has gone to prison or made adequate financial restitution.

To call this picture ‘irony’ would be too weak a sentiment. It represents quite simply an organized effort to break the back of the middle class, generally well orchestrated (though not with regard to swipe fees) and always well funded–being given a pass by the political press, which is missing this story the way it missed the story of Bush-Cheney’s true objectives back in the 2000 election campaign, missed the story of the 2000 non-vote count in Florida, and missed the story of the lead-up to invading Iraq.

And now they’re doing it again.

The picture is by no means just Dick Armey. Armey is just unusually crude and up-front—“Join the Fight Against the Unions,” reads another of his message lines—and I am undoubtedly doing him a favor (unsolicited and uncompensated) by writing this. That said, the FreedomWorks messages are peculiarly blatant. The most recent message reads, “Do Not Raise the Debt Ceiling and Save Medicare!”

Uncle Sigmund, call your office.

Another message from spring 2011 read, “First Wisconsin, Now Ohio!”

More eagerness to get public sector workers fired.

Not to harp on the misfeasance of the entrenched know-it-all political press, but that FreedomWorks has not been laughed out of town—along with the GOP budget proposals–really is a measure of institutional feebleness. Right now the entrenched are focusing most of their energy on Rep. Weiner, at the expense even of other sex scandals: Last word is that there are more shoes to drop re Gov. Arnold Schwarzenegger. Btw In case anyone missed it, Schwarzenegger was propped up, not to say boosted, by the same know-it-alls for years.

to be continued

Governor Palin’s Ride

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Palin on Harley

Governor Palin’s Ride

 

Listen, my children, and you shall hear

Of Palin’s requital for snubs severe

From electable candidates, in 2008:

Hardly a politico can now relate

He remembers that famous time and year.

 

She said to her friends,–“If Romney announce

By land or sea from the town tonight,

Tweet a message, or text, don’t let it bounce,

To me or a fan if we lose the limelight,–

One if by land and two if by sea;

And I on somebody’s Harley will be,

Ready to ride and spread the alarm

Through every sex-messaging village and farm,

For the knuckleheads to be up and to arm.”

 

Then she said good-night, and with muffled oar

Silently rowed to Max Factor’s shore;

Meanwhile, her friends, through alley and street

Wandered and watched with eager ears,

Till in the silence around them they hears

The muster of men at the green-room door,

The clink of mugs, and the tramp of feet,

And the shuffling of photo-grenadiers

Slouching down to their marks on the floor.

 

Palin in greenroom

Beneath, they could hear, like a sentinel’s tread,

The watchful night-wind, as it went

Creeping along from tent to tent,

And seeming to whisper, “All is well!”

A moment only they feel the spell,

For suddenly all their thoughts are bent

On a shadowy something far away,

Where the river widens to meet the bay,–

Like literacy, but it’s still the GOP—

A line of black, that bends and floats

On the rising tide, like a bridge of boats.

 

Meanwhile, impatient to mount and to ride,

 [another “Meanwhile,” Henry, really? Seriously?]

Alarmed that somebody’s boat might be raised by a tide,

Black-jeaned and leathered, with heavy stride,

On a different coast walked Governor Rear

Now she patted the Harley’s side,

Now gazed on the landscape far and near,

But mostly she watched with eager search

The twinkling monitor of the old iPod.

 

Palin and Harley fan

And lo! As she looks, on the menu site,

A glimmer, and then a gleam of light!

She springs to the back seat, the angle she turns,

But lingers and gazes, till full on her sight

A second light on the monitor burns!

 

A hurry of Harleys in a village-coast,

A shape in the moonlight, a bulk in the dark,

And beneath from the pebbles, in passing, a spark

Struck out by a Hog that flies fearless and fleet:

That was all! And yet, through the gloom and the light,

The fate of a career was riding that night;

And the spark struck out by that hog, in her flight,

Kindled the launching of Romney to toast.

 

Romney launches bid for president

It was one by the village-clock

When she rode into Lexington.

She saw the gilded weathercock

Swim in the moonlight as she passed,

Like a tweety bird already staring aghast.

 

It was two by the village-clock

When she came to the bridge in Concord town.

She heard the bleating of the flock,

And one at the bridge would be first to fall,

Pierced by his own tweeted photo-ball.

 

Former Rep. Weiner

You know the rest. In the books you have read

How the former governor fired and fled,–

How the GOP regulars gave ball for ball,

From behind each fence and farmyard-wall,

Chasing other knuckleheads down the lane,

Then crossing the fields to emerge again,

While Governor Palin denied it all.

 

 

So in the spotlight did not ride Revere;

Through the night went his cry of alarm

To every Middlesex village and farm,–

A cry of defiance, and not of fear,–

A voice in the darkness, a knock at the door,

And a word that shall echo forevermore!

As long as people try to get it right,

Through all our history, if we read,

In the hour of darkness and peril and need,

The people will waken and listen to hear

The hurrying hoof-beat of that steed,

And the midnight-message of Paul Revere.

 

 (“The liars are winning! The liars are winning!”)

Anne Arundel Community College teaches wrong lesson: Break Maryland law and get what you want

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Anne Arundel Community College teaches wrong lesson: Break Maryland law and get what you want

The unfair treatment of instructor Bert Hubinger

Colleges should not break the law.

 

AACC

Background: In Maryland, recording a private conversation requires the consent of both parties. Secretly recording a conversation falls legally under the heading of an “intercept,” as defined in “Wiretapping and electronic surveillance” in the Annotated Code of Maryland (“Courts and Judicial Proceedings, Title 10. Evidence, Subtitle 4.)

Incidents of secret videotaping proliferating

The law on being recorded in a conversation without consent varies from state to state. As shown in a number of similar or parallel incidents, numerous states permit audiotaping or videotaping a conversation, even a private conversation, if only one party to the conversation consents. Maryland, where Anne Arundel Community College is located, is not one of these states.

On March 31, AACC adjunct English professor Bert Hubinger met by prior arrangement with one of his students, Michael A. (Mike) Fowler, 38. The meeting took place in the classroom, after everyone else had left—“I don’t really have an office,” says Hubinger, who has taught at AACC since 1998—to discuss issues arising from Fowler’s conduct, including non-attendance and disruptions in class.

Hubinger was interviewed by telephone and has communicated several times by email and phone. Fowler responded to questions by messages through his Facebook page.

 

After receiving a grade of 65 on his first essay in Hubinger’s English 112 class, Fowler was “furious,” Hubinger wrote to AACC administrators, telling Hubinger that he knew better how to teach, because he taught swimming, and that he had a military background in Special Forces. Fowler’s Facebook page lists his major as psychology. Hubinger’s wife is a child psychologist. Hubinger says that he assumed Fowler had dropped the course after missing classes from March 10 to March 29, when he returned but stormed out mid-class.

The March 31 meeting was their second private talk. Fowler told Hubinger that he had complained about Hubinger to the English department chair, Ronald A. Deabreu. Hubinger wrote to AACC administrators, “He said that he had gone to DeAbreu to complain about me, and that DeAbreu’s instructions to him were to instruct me to help him catch up on all the work he had missed during his absences.” DeAbreu has not responded to a call for comment.

Hubinger, who says he “used the f-word twice,” adds that “Fowler even had the impertinence to tell me what I could say or do. That’s when I reached my limit, and cursed at him.” Hubinger says that he angrily refused to make up for the student’s missed work after being repeatedly insulted. Fowler, he says, seemed to stay calm in the individual conference despite his previous anger and disruptions. At the end of the conversation, Fowler exited the classroom, pulling his cell phone camera out of his pocket and waggling it at Hubinger, who says Fowler smiled at him and said, “Got you! Thanks!”

Fowler posted the video clip online the same day, posting it on his Facebook page, on YouTube, and at toshcommunity.comedycentral.com. He also joined the Tosh.O online community March 31, but his page at toshcommunity.com has no profile and no other postings. The video remained on Facebook Apr. 26, captioned “AACC Professor Bert Hubinger goes way to [sic] FAR!” It has since been removed from Facebook but appears on other web sites, some dedicated to practicing English.

Fowler also sent a copy of the video to DeAbreu, the English Department chair, “as a precautionary measure,” he says. He has not replied to a question whether he sent the clip to anyone else at AACC.

Under Maryland law, every further transmission of the original illegal recording is also a violation of law.

AACC Interim Director of Public Relations and Marketing Laurie Farrell, returning a call for comment, says only that the college “does not discuss personnel or student actions, or any actions, if any, taken by the college with regard to either.”

 

“I haven’t seen it myself”

Links to the video bring up the message “This video is private.” “I haven’t seen it myself,” says Hubinger. Fowler has not replied to questions whether he would allow viewing access to Hubinger, or to a journalist.

 

At Tosh.O on May 11, the video shows 92 views. Heading: “AACC Professor Bert Hubinger Uncensored!! Watch it . . .”

  • Caption: “English professor Bert Hubinger and I had a bit of a disagreement..It is a bit slow in the begining..wait for it because he GOES WAY OUT OF LINE FOR A PROFES…”

Hubinger was shortly informed by superiors that “certain people,” meaning administrators, had seen the video. He was also informed that his teaching services would not be needed in fall 2011, and his tutoring—a regular part of his job, approximately ten hours a week–was terminated immediately.

Fowler is 38 according to his MySpace page. Asked about the incident, Fowler begins cautiously: “What position are you taking with this article?”

Responding to further questions, he writes, “I posted the video shortly after the situation occured..and no the video is completely unedited..I sent a copy to the english department head as a precautionary measure.”

The audio-visual aid worked with unusual effectiveness. As stated, Hubinger was informed by superiors that he was not going to be offered tutoring or fall classes. Hubinger says that Fowler was transferred to another class.

 

Back to the law

The Maryland statute is commendably clear; see “§ 10-402. Interception of communications generally; divulging contents of communications; violations of subtitle”:

“(a) Unlawful acts. –Except as otherwise specifically provided in this subtitle [law enforcement] it is unlawful for any person to:

(1) Willfully intercept, endeavor to intercept, or procure any other person to intercept or endeavor to intercept, any wire, oral, or electronic communication;

(2) Willfully disclose, or endeavor to disclose, to any other person the contents of any wire, oral, or electronic communication, knowing or having reason to know that the information was obtained through the interception of a wire, oral, or electronic communication in violation of this subtitle; or

(3) Willfully use, or endeavor to use, the contents of any wire, oral, or electronic communication, knowing or having reason to know that the information was obtained through the interception of a wire, oral, or electronic communication in violation of this subtitle.

(b) Penalty. –Any person who violates subsection (a) of this section is guilty of a felony and is subject to imprisonment for not more than 5 years or a fine of not more than $10,000, or both.”

In a nutshell: An Anne Arundel Community College student broke Maryland law when he video-recorded a private conversation without the professor’s consent, broke the law again when he posted the video online, and broke it again transmitting the video to the department chair. Any administrator who then transmitted the video access to others, aside from legal counsel, also violated the statute.

That no administrator viewing the video saw fit to give the instructor himself access to it looks as snaky as the initial videotaping.

Even for a non-lawyer, it is easy to understand why school administrators refuse to discuss a matter involving personnel or a student. It is particularly easy to understand in a matter where administrators have not only the official obligation to protect others’ privacy but also the constitutional protection against self-incrimination.

But it is more difficult to understand why AACC, or any institution funded by Maryland citizens, would not have a policy of compelling its students to abide by Maryland law in the first place.

As clarified by Raquel Guillory, Public Information Officer for Maryland Attorney General Douglas Gansler, “It doesn’t matter whether a student is on campus or not, they have to abide by Maryland law. Being on campus doesn’t make them immune.” Guillory adds, succinctly, “The student issue is not an issue. If you’re in Maryland, you have to abide by Maryland law.”

 

The same principle should apply to campus administrators.

Too bad it was not applied in the Hubinger incident.

Fowler has not responded to further questions. Hubinger has filed charges with Anne Arundel County and with the State’s Attorney for AA County. “We’ll see what happens,” he says.

It will be interesting to see, going forward, what if any legal costs AACC administrators try to stick the public with. A more economical as well as more principled route in future would be to inform incoming college students of the right not to be secretly taped in Maryland, and of available channels for complaint or redress on campus.

 

To be continued

[This article, deleted by the system among hundreds of articles and blog posts in summer 2011, is re-posted using archives and Word files.]

Goldman Sachs shorted its own products, Senate investigation reports

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Senate Permanent Subcommittee on Investigations: Goldman Sachs shorted its own products

Sen. Carl Levin intends to refer Goldman Sachs to the Justice Department and the SEC for possible prosecution and civil litigation, regarding its trading in subprime mortgage-related paper.

Goldman Sachs

The Senate Permanent Subcommittee on Investigations, chaired by Levin, released its report on the subprime lending crisis yesterday, following months of investigation into the financial debacle culminating in 2008.

Sen. Levin

“The investigation found that the crisis was not a natural disaster, but the result of high risk, complex financial products; undisclosed conflicts of interest; and the failure of regulators, the credit rating agencies, and the market itself to rein in the excesses of Wall Street.”

Among the most hair-raising instances of the latter, the report summarizes, were problems at the formerly hallowed Wall Street firm of Goldman Sachs.

Saving discussion for later, following are some pertinent passages from the Executive Summary on Goldman Sachs, one of two case studies on investment bank abuses. (The other is DeutscheBank.)

As the Subcommittee notes,

“Investment banks can play an important role in the U.S. economy, helping to channel the nation’s wealth into productive activities that create jobs and increase economic growth. But in the years leading up to the financial crisis, large investment banks designed and promoted complex financial instruments, often referred to as structured finance products, that were at the heart of the crisis. They included RMBS [residential mortgage backed securities] and CDO [collateralized debt obligation] securities, credit default swaps (CDS), and CDS contracts linked to the ABX Index. These complex, high risk financial products were engineered, sold, and traded by the major U.S. investment banks.”

Wall Street commerce in these complex packages based ultimately on ordinary homeowners’ mortgages became brisk and then became huge:

“From 2004 to 2008, U.S. financial institutions issued nearly $2.5 trillion in RMBS and over $1.4 trillion in CDO securities, backed primarily by mortgage related products. Investment banks typically charged fees of $1 to $8 million to act as the underwriter of an RMBS securitization, and $5 to $10 million to act as the placement agent for a CDO securitization. Those fees contributed substantial revenues to the investment banks, which established internal structured finance groups, as well as a variety of RMBS and CDO origination and trading desks within those groups, to handle mortgage related securitizations. Investment banks sold RMBS and CDO securities to investors around the world, and helped develop a secondary market where RMBS and CDO securities could be traded. The investment banks’ trading desks participated in those secondary markets, buying and selling RMBS and CDO securities either on behalf of their clients or in connection with their own proprietary transactions.”

This is where the plot thickens:

Two investment banks in particular, Goldman Sachs and Deutsche Bank, “illustrate a variety of troubling practices that raise conflicts of interest and other concerns . . .”

Goldman was engaged not only in selling complex derivatives, i.e. boosting them, but also in betting against complex derivatives:

“From 2004 to 2008, Goldman was a major player in the U.S. mortgage market. In 2006 and 2007 alone, it designed and underwrote 93 RMBS and 27 mortgage related CDO securitizations totaling about $100 billion, bought and sold RMBS and CDO securities on behalf of its clients, and amassed its own multi-billion-dollar proprietary mortgage related holdings. In December 2006, however, when it saw evidence that the high risk mortgages underlying many RMBS and CDO securities were incurring accelerated rates of delinquency and default, Goldman quietly and abruptly reversed course.

“Over the next two months, it rapidly sold off or wrote down the bulk of its existing subprime RMBS and CDO inventory, and began building a short position that would allow it to profit from the decline of the mortgage market. Throughout 2007, Goldman twice built up and cashed in sizeable mortgage related short positions. At its peak, Goldman’s net short position totaled $13.9 billion. Overall in 2007, its net short position produced record profits totaling $3.7 billion for Goldman’s Structured Products Group, which when combined with other mortgage losses, produced record net revenues of $1.2 billion for the Mortgage Department as a whole.”

Investment bank and investment advisor Goldman did not go the extra mile in transparency:

“Throughout 2007, Goldman sold RMBS and CDO securities to its clients without disclosing its own net short position against the subprime market or its purchase of CDS contracts to gain from the loss in value of some of the very securities it was selling to its clients.” [emphasis added]

There are four such mega-packages in particular, “four CDOs that Goldman constructed and sold called Hudson 1, Anderson, Timberwolf, and Abacus 2007-AC1.”

“In some cases, Goldman transferred risky assets from its own inventory into these CDOs; in others, it included poor quality assets that were likely to lose value or not perform. In three of the CDOs, Hudson, Anderson and Timberwolf, Goldman took a substantial portion of the short side of the CDO, essentially betting that the assets within the CDO would fall in value or not perform. Goldman’s short position was in direct opposition to the clients to whom it was selling the CDO securities, yet it failed to disclose the size and nature of its short position while marketing the securities. While Goldman sometimes included obscure language in its marketing materials about the possibility of its taking a short position on the CDO securities it was selling, Goldman did not disclose to potential investors when it had already determined to take or had already taken short investments that would pay off if the particular security it was selling, or RMBS and CDO securities in general, performed poorly.”

Taking these four packages one by one:

  • “In the case of Hudson 1, for example, Goldman took 100% of the short side of the $2 billion CDO, betting against the assets referenced in the CDO, and sold the Hudson securities to investors without disclosing its short position. When the securities lost value, Goldman made a $1.7 billion gain at the direct expense of the clients to whom it had sold the securities.”
  • “In the case of Anderson, Goldman selected a large number of poorly performing assets for the CDO, took 40% of the short position, and then marketed Anderson securities to its clients. When a client asked how Goldman “got comfortable” with the New Century loans in the CDO, Goldman personnel tried to dispel concerns about the loans, and did not disclose the firm’s own negative view of them or its short position in the CDO.”
  • “In the case of Timberwolf, Goldman sold the securities to its clients even as it knew the securities were falling in value. In some cases, Goldman knowingly sold Timberwolf securities to clients at prices above its own book values and, within days or weeks of the sale, marked down the value of the sold securities, causing its clients to incur quick losses and requiring some to post higher margin or cash collateral. Timberwolf securities lost 80% of their value within five months of being issued and today are worthless. Goldman took 36% of the short position in the CDO and made money from that investment, but ultimately lost money when it could not sell all of the Timberwolf securities.
  • “In the case of Abacus, Goldman did not take the short position, but allowed a hedge fund, Paulson & Co. Inc., that planned on shorting the CDO to play a major but hidden role in selecting its assets. Goldman marketed Abacus securities to its clients, knowing the CDO was designed to lose value and without disclosing the hedge fund’s asset selection role or investment objective to potential investors. Three long investors together lost about $1 billion from their Abacus investments, while the Paulson hedge fund profited by about the same amount. Today, the Abacus securities are worthless.”

[update]

Goldman spokesman Michael DuVally returned a call for comment on the Subcommittee report and referral to the DOJ. His statement, by email:

“Margie,

As discussed.

Michael

General response:

“While we disagree with many of the conclusions of the report, we take seriously the issues explored by the Subcommittee. We recently issued the results of a comprehensive examination of our business standards and practices and committed to making significant changes that will strengthen relationships with clients, improve transparency and disclosure and enhance standards for the review, approval and suitability of complex instruments.”

On the issue of GS allegedly giving misleading testimony:

“The testimony we gave was truthful and accurate and this is confirmed by the Subcommittee’s own report. The report references testimony from Goldman Sachs witnesses who repeatedly and consistently acknowledged that we were intermittently net short during 2007.  We did not have a massive net short position because our short positions were largely offset by our long positions, and our financial results clearly demonstrate this point.””

More later

Richard Helms, unsung hero re Iran?

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Richard Helms unsung hero re Iran?

 

Shah of Iran

As previously written, part of the long shadow cast by foreign policy in the Nixon administration has come from Nixon, Kissinger and Gerald Ford’s unwillingness or inability to understand domestic unrest in Iran. In a reciprocal cause and effect, their intransigent unwillingness in the 1970s to acknowledge the extent of the Shah’s unpopularity among his own people corresponded to their unwillingness to make U.S. policy toward Iran genuinely reflective of American interest.

The release of embassy cables by wikileaks casts new light on U.S. relations with Iran in the 1970s, with the unexpected twist of a new unsung hero for the epoch, Ambassador Richard Helms.

 

The condensed version of this story is that former Director of Central Intelligence Helms apparently learned something from the shameful CIA episodes in Cuba, Vietnam and Chile. Better late than never, although as Bob Haldeman might have put it, “TLsub2”—too little, too late.

The Nixon administration’s coziness with the Shah of Iran, little publicized by Nixon’s people at the time, has already been highlighted by a February 1972 cable from the U.S. ambassador in Iran urging that a shipment of fighter planes for the shah be expedited. Such friendly overtures to the shah were not impeded by ample warning from the U.S. embassy that the shah was under attack by his populace.

Predictably, this alliance between administrations of two countries disconnected from their people came to a head in a foreign policy disaster, a disaster which seems to have been foreseen by Helms.

In a lengthy cable on March 4, 1975, Helms warned Washington of the trouble brewing in Iran. This, be it noted, was the period when the White House was occupied by President Gerald Ford, the man who famously said in debate with Jimmy Carter that the Soviet Union did not dominate Eastern Europe.

Helms’ cable, declassified by the State Department, is crisp, clear and to the point, refreshingly clear of cant about our friends on or near the Peacock Throne. Helms summarizes the shah’s light-bulb idea of creating a one-party system as it deserves:

ALL IRANIANS OF VOTING AGE ARE EXPECTED TO EXPRESS ALLEGIANCE TO NEW PARTY OR RISK BEING VIEWED AS OPPONENTS OF SHAH AND EVEN TRAITORS WHO SHOULD LEAVE IRAN OR GO TO PRISON. SHAH EXPLAINED IRAN’S RETURN TO SINGLE PARTY SYSTEM AS NECESSARY BECAUSE QTE SHAMEFUL UTTERANCES UNQTE BY SOME IRANIANS SHOWED NEED FOR IRANIANS TO CLOSE RANKS IN EFFORTS TO ACHIEVE QTE GREAT CIVILIZATION, UNQTE AND BECAUSE OPPOSITION PARTIES HAD FAILED. ELECTIONS SCHEDULED FOR SUMMER WILL APPARENTLY BE HELD, BUT IT IS NOT CLEAR HOW THEY WILL BE ORGANIZED. NET RESULT IS TO MAKE IRANIAN POLITICAL SYSTEM LESS FLEXIBLE. INTERNATIONAL REACTION

WILL PROBABLY RANGE FROM INDIFFERENCE TO CHARGES OF INCREASED TOTALITARIANISM.

 

Further enhancements of dictatorship are clearly in the offing:

SHAH’S LENGTHY STATEMENT AT HIS MARCH 2 PRESS CONFERENCE, FROM WITH CORRESPONDENTS FOR FOREIGN MEDIA WERE EXCLUDED . . . ESTABLISHED IRANIAN RESURGENCE PARTY. NEW PARTY WILL

ABSORB RULING IRAN NOVIN PARTY, LOYAL OPPOSITION MARDOM PARTY, AND THE ULTRA-NATIONALIST PAN IRANIST PARTY AND ITS SPLINTER GROUP THE IRANIANS PARTY. PRIME MINISTER HOVEYDA IS TO BE SECRETARY GENERAL FOR A PERIOD OF AT LEAST TWO YEARS. SHAH WILL LATER PROPOSE CHAIRMAN OF NEW PARTY’S EXECUTIVE BOARD AND PRESIDENT FOR ITS POLITICAL BUREAU.

 

The picture does not get any sunnier as the shah and Helms continue:

ONLY REQUIREMENTS FOR MEMBERSHIP IN NEW ORGANIZATION WOULD BE LOYALTY TO (1) MONARCHY, (2) IRAN’S CONSTITUTION, AND (3) SIXTH OF BAHMAN (SHAHPEOPLE) REVOLUTION. . . HE URGED ALL IRANIANS ELIGIBLE TO VOTE TO ENTER INTO NEW POLITICAL STRUCTURE OR CLARIFY THEIR POSITION. BY THIS HE MEANT THAT THOSE WHO COULD NOT AGREE WITH THE THREE PRINCIPLES SHOULD LEAVE IRAN OR GO TO PRISON AS TRAITORS UNLESS THEY OPENLY EXPRESSED THEIR DISAPPROVAL AND WERE NOT ANTINATIONAL. IF DISAPPROVAL IS IDEOLOGICAL, PERSON WOULD REMAIN FREE

IN IRAN BUT QTE SHOULD NOT HAVE ANY EXPECTATIONS UNQTE. FULL PARTICIPATION IN IRAN’S PROGRESS WOULD OBVIOUSLY REQUIRE MEMBERSHIP IN THE IRAN RESURGENCE PARTY. HE SAID IT WAS HIS EXPECTATION THAT WORKERS, FARMERS, AND TEACHERS WOULD BE THE FIRST GROUPS TO ANNOUNCE THEIR LOYALTY TO THE NEW PARTY.

Helms’ comment is trenchant:

COMMENT: ABOVE ALL, SHAH’S ACTION IN RETURNING TO SINGLE PARTY SYSTEM OF 1964-67 PERIOD SHOWS HIS EXTREME SENSITIVITY TO CRITICISM AND STRONG DESIRE TO RECEIVE OVERT EVIDENCE OF POPULAR SUPPORT. AFTER HE EXPERIMENTED WITH TAME OPPOSITION PARTIES IN 1956-64 PERIOD WITH POOR RESULTS, SHAH THEN TURNED TO HASSAN ALI MANSUR’S PROGRESSIVE SOCIETY TO CREATE IRAN NOVIN PARTY AS INSTRUMENT TO IMPLEMENT HIS SIXTH OF BAHMAN REVOLUTION. MARDOM PARTY WAS SUBSEQUENTLY REJUVENATED TO STIMULATE IRAN NOVIN TO PERFORM MORE EFFECTIVELY. DESPITE CONSTANT STATEMENTS OF LOYALTY TO SHAH AND HIS PLANS FOR IRAN, PARTIES HAVE APPARENTLY NOT PLEASED HIM.

. . . EVEN ACTIVITIES OF GELDED OPPOSITION HAD PROVED TOO CRITICAL FOR SHAH’S TASTE. NEVERTHELESS HIS PAST STATEMENTS INDICATED CONTINUING SUPPORT FOR COCCEPT OF MULTI-PARTY SYSTEM IN IRAN, AND IMPERIAL DECISION TO INSTITUTE ONEPARTY STATE REPRESENTS 180-DEGREE SHIFT IN POLICY WHICH ALSO APPEARS TO NEGATE EARLIER PROMISES OF FREER ELECTIONS LATER THIS YEAR. KEY SECTION OF SPEECH IS COMMENT THAT HE HAD HEARD QTE SOME REALLY SHAMEFUL UTTERANCES, WHICH IN NOW WAY SHOULD BE EXPECTED FROM AN IRANIAN. THIS SCENE, OF COURSE, HAS ALWAYS RECURRED WHEN IRAN HAS BEEN ENGAGED IN THE DEFENCE OF ITS RIGHTS AT A HISTORIC JUNCTURE. THIS SITUATION IS INTOLERABLE, UNQTE UNDER THESE CIRCUMSTANCES WE DOUBT THAT MUCH CONSTRUCTIVE CRITICISM WILL EMERGE FROM THE IRANIAN RESURGENCE PARTY.

The conclusions are sadly prescient:

IN OPERATIONAL TERMS LITTLE HAS CHANGED, FOR DESPITE FACADE OF QTE ME-TOO UNQTE OPPOSITION PARTIES SHAH HAS ALWAYS CALLED THE TUNE AND ONLY RULING IRAN NOVIN PARTY HAD ANY IMPORTANCE. PRIME MINISTER HAS BEEN LEAD DANCER, AND HIS SELECTION AS SECGEN AT JANUARY PARTY CONGRESS HAD TIED IRAN NOVIN PARTY EVEN CLOSER TO SHAH. IMMEDIATE CONSEQUENCE OF NEW MOVE HAS BEEN FLOOD OF STATEMENTS OF LOYALTY TO SHAH, CONSTITUTION AND REVOLUTION, BOTH BY GROUPS AND INDIVIDUALS. THERE IS CLEARLY NO VIABLE ALTERNATIVE FOR

IRANIANS WHO WANT TO PARTICIPATE ACTIVELY IN IRAN‘S DEVELOPMENT AND SHARE ITS PROSPERITY. ALL DIFFERENCES OF VIEW ON HOW TO IMPLEMENT SHAH’S PLAN FOR IRAN WILL BE SUPPRESSED UNTIL NEW PARTY DEVELOPS AN IDEOLOGY AND ITS LEADERSHIP IS CONSTITUTED.

 

INTERNATIONAL REACTION WILL PROBABLY VARY FROM INDIFFERENCE TO INCREASINGLY SHRILL CHARGES OF TOTALITARIANISM. IRAN’S IMAGE AS COUNTRY IN WHICH ALL ELEMENTS WERE BEING TAPPED IN DEVELOPMENT PROCESS MAY SUFFER UNLESS NEW PARTY’S MEMBERSHIP COMES FROM BROAD SPECTRUM. IT APPEARS THAT EARLIER SUCCESSFUL IRANIAN POLICY OF COMPROMISE AND COOPERATION HAS BEEN REPLACED BY QTE TAKE IT OR LEAVE IT UNQTE STANCE IN DEALING WITH OPPOSITION.

IN SUM, GIVEN EXISTING STRICT DEGREE OF POLITICAL CONTROLS, SHAH’S DECISION TO MELD ALL POLITICAL PARTIES INTO ONE APPEARS TO OFFER LITTLE IN WAY OF IMPROVEMENTS TO IRANIAN POLITICAL SYSTEM WHILE ADDING SEVERAL DISADVANTAGES BOTH DOMESTICALLY AND INTERNATIONALLY.

 

Note:

Newly released tapes continue to disclose Nixon’s problems with ethnicity in the U.S. They have long been written about, notably in the vibrant and colorful How the Good Guys Finally Won, by Jimmy Breslin. Breslin’s touching narrative about Italian-American congressman Peter Rodino (D-N.Y.), an honorable man, is worth reading on its own.

Fox News transcript, yesterday morning

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Fox News transcript, yesterday morning

Following up the previous post: For anyone who missed Chris Wallace and Representatives Chris van Hollen (D-Md.) and Paul Ryan (R-Wis.) talking about the tax bill yesterday on Fox News Sunday, portions of the transcript are below.


Wallace

First, here is Wallace’s idea of a lead-in:

 

Nixon and the Shah of Iran

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Nixon and the Shah of Iran

 

Shah of Iran

 

Diplomatic cables released via wikileaks reinforce the perception that the Nixon administration was too cozy with the Shah of Iran. While few cablegrams dating from the 1970s are included in ‘cablegate,’ three released so far originate from the U.S. embassy in Tehran, Iran, including a strongly worded message in February 1972 favoring shipment of F-4E fighter planes for the Shah.

The cable is highlighted on wikileaks here.

Shah Reza Pahlavi had been placed back on the ‘Persian’ peacock throne in 1953 by the CIA, after his people ousted him in favor of a better-qualified political opponent, Mohammad Mossadeq. The head of a repressive regime widely credited with looting the country and enriching his own family, supported in power by the fearsome SAVAK, secret police, Pahlavi re-styled himself ‘shah’ after ancient (undemocratic) tradition.

 

By the early 1970s, the secret police in combination with other forces had entrenched a dictatorship criticized by international human rights organizations. Within a few years, the Shah, increasingly unpopular, was ousted by revolution rather than by peaceful process, bringing down allies and supporters with him. Everyone knows what happened when the Shah was allowed entry into the U.S. for medical treatment by President Jimmy Carter, fueling Iranian suspicions of another U.S.-backed takeover in the offing. Incidentally, the minimal actual spycraft going on in the U.S. embassy in Iran was later reported as “routine, prudent espionage conducted at diplomatic missions everywhere.”

 

Carter

The hostage crisis is associated with Carter as Watergate is associated with Nixon; news outlets do not always remind readers and viewers of longer causes. (I had to send evidence, documents, to readers unaware that presidents Reagan and George H. W. Bush had supplied Saddam Hussein with money and weapons, when I wrote about the issue during the lead-up to invading Iraq.) Anyway, Nixon became yesterday’s news when he resigned rather than face impeachment, and the Watergate scandal used up all the oxygen for reporting on Nixon.

Instant amnesia about the mistakes and misdeeds of a previous administration did not begin yesterday. The fact remains that Nixon and Jerry Ford, his Vice President who became president, gave aid and comfort to the Shah in a degree not emphasized in Peoria.  “SUBJECT: ACCELERATION OF F-4ES FOR IRAN”:

“GENERAL AZIMI, MINISTER OF WAR, ON INSTRUCTION OF SHAH ASKS THAT WE TAKE ANOTHER HARD LOOK AT F-4E PRODUCTION LINE IN ORDER ACCELERATE DELIVERY OF ONE SQUADRON OF F-4ES TO IRAN IN 1972. REQUEST REFLECTS SHAH’S INCREASING CONCERN OVER SOVIET AMBITIONS IN AREA AND ESPECIALLY THREAT SHAH SEES TO IRAN OF FRIENDSHIP TREATY UNDER CONSIDERATION BY IRAQ AND USSR. SHAH RECOGNIZES PROBLEMS THIS POSES FOR US BUT IS TURNING TO USG WITH THIS REQUEST TO GIVE IRAN HIGHER PRIORITY ON FA-4E PRODUCTION SCHEDULE BECAUSE HE REGARDS US AS MOST DEPENDABLE FRIEND. END SUMMARY

ACTION REQUESTED: COUNTRY TEAM RECOMMENDS US REVIEW F-4E PRODUCTION LINE AND RESPOND FAVORABLY TO SHAH’S REQUEST FOR 16 F-4ES IN 1972 FROM WHATEVER SOURCE MAY BE AVAILABLE.”

As with the Reagan and Bush administrations, the short story here is that a repressive regime shopping for advanced aerospace and military technology did not want long for wares. Like Saudi Arabia later, and with the same fatal potential for blowback against American interests, the Shah got what he wanted and more.

The longer saga dating from the Nixon administration, and the flip side of the same coin, is Nixon and National Security Advisor Henry Kissinger’s continuing inability, or unwillingness, to understand what domestic unrest in Iran actually meant. On Aug. 22, 1972, they received what might be called adequate warning. The cable from the U.S. embassy in Iran begins,

“SUMMARY: FOLLOWING ASSASSINATION OF GENERAL SAID TAHERI, BOMBING AND OTHER TERRORIST ACTIVITIES HAVE CONTINUED TO INCREASE. SAVAK MAINTAINING ITS POLICY OF WIDESPREAD PREVENTIVE ARRESTS AND, WHILE THIS RUNS RISK OF HEIGHTENING RESENTMENT AMONG POPULACE, OFFICIALS SEEM CONFIDENT THAT GUERRILLAS ARE ON THE RUN. WE ARE SKEPTICAL ABOUT THE OFFICIAL OPTIMISM AND FEEL THAT SANGUINE PUBLIC STATEMENTS AND THE GUERRILLA REACTION THEY USUALLY PROVOKE MAY FURTHER ERODE CREDIBILITY OF SECURITY ORGANS IN MIND OF PUBLIC.

END SUMMARY.”

Gen. Said Taheri was the head of prisons. The embassy clearly saw the downside of ongoing repressive tactics and a government crackdown:

“SAVAK AND OTHER SECURITY ORGANS ARE PROCEEDING WITH A WIDESPREAD AND, WE HEAR, NOT VERY WELL TARGETED ROUND-UP OF SUSPECTS, AIDED BY LISTS OF NAMES AND OTHER DOCUMENTS FOUND IN DWELLING OF A RECENTLY SLAIN TERRORIST LEADER. POLICE NETS, WHICH ARE REPORTEDLY HAULING IN THE INNOCENT WITH THE GUILTY, HAVE EXTENDED AS FAR AFIELD AS ISFAHAN WHERE A NUMBER OF SUSPECTS WERE ARRESTED TWO WEEKS AGO.”

The telegram, signed by Ambassador Joseph S. Farland, goes on,

“COMMENT: WE CONSIDER IT MORE LIKELY THAT TAHERI WAS PERSONALLY TARGETED DUE TO HIS DIRECT INVOLVEMENT IN ANTI-GUERRILLA ACTIVITIES. MOREOVER, SKILLFUL MANNER IN WHICH ASSASSINATION CARRIED OUT, REQUIRING CAREFUL PLANNING AND RECONNAISSANCE AS WELL AS DEFT EXECUTION, APPEARS TO INDICATE THAT THOSE INVOLVED WERE MUCH BETTER TRAINED THAN AVERAGE TERRORISTS, SOME OF WHOM HAVE BEEN BLOWN UP BY THEIR OWN BOMBS.

IT IS POSSIBLE THAT NUMBER OF GUERRILLA INCIDENTS WILL BEGIN TO TAPER OFF, BUT WE DO NOT SHARE SADRI’S CONFIDENCE THAT HIS TACTICS AND THOSE OF SAVAK CAN COMPLETELY HALT TERRORIST ACTIVITY. IN FACT OVER REACTION AND TOO ZEALOUS A REPRESSION BY SECURITY ORGANIZATIONS SEEM AT LEAST AS LIKELY TO RECRUIT NEW GUERRILLAS AS TO STAMP OUT OLD ONES. IN ADDITION WISDOM SEEMS QUESTIONABLE OF SECURITY OFFICIALS MAKING PUBLIC PRONOUNCEMENTS ABOUT BREAKUP OF GUERRILLA GROUPS AND PREDICTIONS OF THEIR DEMISE. WE RECALL THAT THE LAST SUCH ANNOUNCEMENT LAST JANUARY WAS FOLLOWED BY SERIES OF EXPLOSIONS ON US-PROPERTIES AND OTHER SITES IN TEHRAN. IN OUR VIEW SUCH PUBLIC DECLARATIONS RUN RISK OF INCREASING CREDIBILITY GAP AND RESENTMENT ON PART OF PUBLIC WHO LIKELY BE INCREASINGLY APPREHENSIVE OF INDISCRIMINATE ARRESTS THAT DO NOT SEEM TO BE STAMPING OUT TERRORISTS.”

Unlike the situation addressed by the previous cablegram, this one includes no quick fix. It is to the ambassador’s credit that he is not ginning up U.S. shipments of more weaponry to the Shah at this point. But it is hardly likely that a major course correction would be requested in such a message, and major course correction was the only way to salvage American interests in Iran in the 1970s.

The next cablegram from our man in Iran is yet more pessimistic. On March 4, 1975, Ambassador Richard Helms—who went to Iran from CIA–sent a devastating assessment by cable to Washington:

“SUBJECT: IRANIAN RESURGENCE PARTY CREATED BY SHAH:

SUMMARY: CREATION OF IRANIAN RESURGENCE PARTY ANNOUNCED BY SHAH MARCH 2 IS MOVE TO SEEK BROADER SUPPORT FOR MONARCHY AND THE SHAHPEOPLE REVOLUTION. ALL IRANIANS OF VOTING AGE ARE EXPECTED TO EXPRESS ALLEGIANCE TO NEW PARTY OR RISK BEING VIEWED AS OPPONENTS OF SHAH AND EVEN TRAITORS WHO SHOULD LEAVE IRAN OR GO TO PRISON. SHAH EXPLAINED IRAN’S RETURN TO SINGLE PARTY SYSTEM AS NECESSARY BECAUSE QTE SHAMEFUL UTTERANCES UNQTE BY SOME IRANIANS SHOWED NEED FOR IRANIANS TO CLOSE RANKS IN EFFORTS TO ACHIEVE QTE GREAT CIVILIZATION, UNQTE AND BECAUSE OPPOSITION PARTIES HAD FAILED. ELECTIONS SCHEDULED FOR SUMMER WILL APPARENTLY BE HELD, BUT IT IS NOT CLEAR HOW THEY WILL BE ORGANIZED. NET RESULT IS TO MAKE IRANIAN POLITICAL SYSTEM LESS FLEXIBLE. INTERNATIONAL REACTION WILL PROBABLY RANGE FROM INDIFFERENCE TO CHARGES OF INCREASED TOTALITARIANISM. SHAH APPARENTLY PLANS TO CONTINUE ACTIVE INVOLVEMENT IN DAILY POLITICAL AFFAIRS. THIS IS CONTRARY TO EARLIER SUGGESTIONS

THAT HE MIGHT BE MOVING GRADUALLY TO CONFINE HIMSELF TO BROAD POLICY GUIDANCE AND LEAVE IMPLEMENTATION TO GOVERNMENT.

END SUMMARY.”

To be continued

Heckuva job brownie, November 1963

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FBI Director J. Edgar Hoover, in a publicity shot

Heckuva job brownie, November 1963

 

 

In what would now be called a ‘heckuva job, Brownie’ moment, FBI Director J. Edgar Hoover is on record as scattering praise and commendations freely in the days following the assassination of President John F. Kennedy.


Ironically, given the course of events and the unavailability of key personnel when they were most needed, Hoover was moved on Dec. 4, 1963,  to issue grateful thanks to all FBI people involved in responding to the assassination. In a memorandum for top personnel headed “RE: COMMENDATION, NOVEMBER 25, 1963,” Hoover wrote,

“I want you to convey my sincere appreciation to the personnel in your division who so graciously volunteered to work on November 25, 1963, in connection with the emergency occasioned by the assassination of the President.

Their devotion to duty and obvious desire to be of assistance and to protect the best interests of the Bureau during this trying time were of the highest caliber and a credit to them. Please extend to all my sincere and heartfelt thanks.

Very truly yours,

John Edgar Hoover

            Director”

It was Hoover’s wont to express praise and blame at frequent intervals, and even highly praised and promoted officers like Courtney Evans received their share of censure as well as praise. By the same token, Bureau divisions and members sometimes got a pat on the back from Hoover at junctures when they might be seen as less than successful, as in the memo quoted here.

There are oddities in the memo aside from characterizing the assassination of a president as “this trying time.” Nov. 25, 1963, was a Monday, and it is puzzling that FBI personnel are being thanked for showing up for work as they would have had to do on any other weekday. Presumably the underlying reference is that President Kennedy was being laid to rest in Arlington Cemetery that day, with full military honors, and the funeral ceremonies were accompanied by a holiday for government workers. Still, the memo jibes oddly with the events; most Americans would have assumed–taken for granted–that FBI investigators and staff were working around the clock on the assassination. The general public would probably have assumed also that the Bureau was working to protect more than its own “best interests.”

In this latter assumption, the public looks to have been mistaken.

The Dec. 4 memo was no impulse; the Director followed it up with another on Dec. 9, 1963, headed “COMMENDATION, NOVEMBER 25, 1963.” This one was directed specifically to the Special Investigative Division handling the investigation of the assassination:

             “By memorandum dated December 4, 1963, the Director requested that his sincere appreciation be conveyed to the personnel who so graciously volunteered to work on November 25, 1963, in connection with the emergency occasioned by the assassination of the President. He stated their devotion to duty and obvious desire to be of assistance and to protect the best interests of the Bureau during this trying time were of the highest caliber and a credit to them.

            The following employees voluntarily reported for duty in the Special Investigative Division on November 25, 1963, and it is recommended that a copy of this memorandum be placed in the personnel file of each of these individuals.”

A list of about 35 names, some redacted in the Evans file, follows.

Funeral procession


Reading this memo is chilling, especially for anyone alive at the time of JFK’s funeral. The sound of that somber drum and the sight of the riderless horse tend to stick in the memory.

 

That J. Edgar Hoover could delicately convey surprise that personnel in the Special Investigative Division did not seize the opportunity to take the day off suggests that, even now, historians still have not come to grips with the actual character of the FBI under Hoover.*


To be continued

 

*There is a faint analogy here, and maybe more than faint, with current revelations from wikileaks. Some news reports on the wikileaks material suggest surprise that diplomats spy on each other, as the hostage-taking at the U.S. embassy in Iran in the 1970s surprised any member of the general public who assumed that diplomats engage solely in diplomacy. However, the infiltration of pure and disinterested diplomacy by intelligence agencies, mainly CIA, while not exonerating the kidnappers, was known especially in the Washington, D.C., region.

 

Material on how much spying among nations is protected by diplomatic immunity is available, although some of it is in books where the pertinent information has to be linked up by painstaking re-organizing.

 

For the moment, it looks as though the chief impact of the wikileaks material has been on people who were saying one thing in public and another in private. This is obviously a penchant not to be over-indulged; equally obviously, all fallible human beings can slip into it. But a big problem is immature personalities in responsible positions, who get a sense of power—whoa!—from deliberately being as two-faced as they can get away with.