April 19, 2011

Bipartisan law breaking

Sam Smith

One of the problems in understanding what is happening in Washington is that if both major parties lie or break the law, the media tends to just go along with it.

A recent example is the case of Obama issuing signing statements allegedly exempting himself from having to obey Congress' defunding of his czars.

To be sure, George Bush issued over a hundred of such statements, essentially saying "screw you" to the US Congress, not to mention the Constitution.

The problem in Obama's case is that a few years ago, when he was seeking a new job, he promised "I will not use signing statements to nullify or undermine congressional instructions as enacted into law." The exceptions would be in cases in which Congress ordered to do something unconstitutional. Obviously, not funding czars - which a democracy shouldn't have in the first place - doesn't fall into this category.

But there is a much greater problem. The media just assumes that since both Democrats and Republicans have used them, they must be legal. In its coverage it totally - so far as Google can tell - failed to mention, for example, a 2006 American Bar Association Task Force that, as Wikipedia explains, "stated that the use of signing statements to modify the meaning of duly enacted laws serves to 'undermine the rule of law and our constitutional system of separation of powers' In fact, the Constitution does not authorize the President to use signing statements to circumvent any validly enacted congressional laws, nor does it authorize him to declare he will disobey such laws (or parts thereof). When a bill is presented to the President, the Constitution allows him only three choices: do nothing, sign the bill, or (if he disapproves of the bill) veto it in its entirety and return it to the House in which it originated, along with his written objections to it."

In other words, Obama, like his predecessor, is clearly disobeying the Constitution. But worse, the Washington media isn't even mentioning the problem because it has become unable to distinguish the difference between habit and the law.

April 18, 2011

How to bribe a politician without anyone noticing

There is no doubt that, as a financial matter, corporations are the greatest abusers of offshore havens. Nichole Tichon, executive director of the Tax Justice Network, notes that "estimates by the Government Accountability Office show at least 83% of the largest 100 companies have created offshore subsidiaries. . . Offshore tax havens cost the Treasury over $100 billion per year. 

In a study cited by the World Bank, Raymond Baker's Global Financial Integrity Program found that two thirds of the offshore havens' business came from corporations and only a third from conventional criminal activity. Just three percent was used to launder bribes. 

Writes Nicholas Shaxson in his excellent new book, Treasure Islands, "This research underlies the point that illicit offshore flows of money are far less about the drug smugglers, Mafiosi, celebrity tax exiles, and fraudsters of the popular imagination and mostly about corporate activity."

Which is fine as long as you're only comparing fiscal impacts. But consider that three percent of $100 billion is $3 billion - and that's just the taxes that aren't being paid on bribes and other funny money. Add to this the fact that these funds are having a political as well as a financial effect. And that it takes a lot less money to buy a politician than it does to make a major corporate tax burden disappear. 

I recently came something I had previously written that included this paragraph:

"In the 1930s, Hot Springs represented the western border of organized crime in the U.S with the local syndicate headed by Owney Madden, a New York killer who had taken over the mob's resort in Arkansas. Owney Madden was an English born gang member who had been arrested more than 40 times in New York by the time he was 21. Madden got the assignment from his boss, Myer Lansky. The plan for Arkansas was modeled on an earlier one in which Governor Huey Long opened a Swiss bank account into which the mob would put $3 to $4 million annually for the right to run casinos in the state."

Two things jumped out. First, the use of offshore havens goes back at least 80 years. Second, one of its early manipulators was a politician looking for a place to hide his illegal money. 

If Huey Long could use offshore money laundering in 1932 to handle $3-4 million in annual bribes, how many politicians and other public officials are currently using the same techniques and with how much money?

Here's how RT Naylor described it in Hot Money & the Politics of Debt:

||||| The Lansky operation perfected the technique of the 'loan-back.' The first stage involved moving funds out of the U.S. Although couriers carrying cash were the favorite vehicle, money could also be moved abroad in the form of traveler's checks, cashier's checks, stocks with nominee ownership, bearer bonds, and even blank airline tickets. . . .

Once safely behind the screen of Swiss bank secrecy laws, the money was ready to return home, with its origins and nature in disguise. Sometimes it stopped en route in a Liechtenstein anstalt (an anonymous company with a single secret shareholder). In the final stage, the initiator of the cycle 'borrowed' the funds from the anstalt or directly from the Swiss bank, repaying the 'loan' with interest - to himself - while deducting the interest from his taxable income as a business expense." ||||

Philip Brewer, in How to Launder Money, gives more details: 

|||| First, you need to make the money disappear. Second, you need to make it reappear in some gradual fashion that doesn't bring it to the attention of whoever you're trying to hide it from…

If you really want to be able to invest the money, get it overseas. . . .There are plenty of fancy, complex ways to get the money overseas, that mostly require an accomplice. The most basic is an invoice scam. Establish a business that imports or exports something. Meet with your customer or supplier and arrange with him to either over-pay or under-bill, and then to have your counterpart deposit (most of) the excess into your foreign bank account.. . . 

If you've got the money overseas somewhere, bring it back in some way that makes it legit. The easiest would be to create an overseas company that then hires you to do something. You do whatever it is and send an invoice whenever you want some cash. You can also reverse the invoice scam that let you get the money overseas in the first place--now you under-pay (or over-bill), while making up the difference out of your foreign bank account. A third option is a fake loan where you "borrow" the money and then simply fail to pay the money back.

If you can't wait to reappear the money gradually, and the amount involved isn't too big, you can always use a simple casino scam. Go to a casino and buy some chips. Do a little low-risk gambling. (For example, bet each chip, one at a time, on red. Do that 20 or 30 times and you'll have about the same amount you started with.) Get a few more chips and repeat. Play a few different games (blackjack, craps, slots). Ideally, go to several different casinos and repeat the whole process there. Eventually, cash in all your chips and go home with a story about how you won a bunch of money at roulette. Pay taxes on your winnings. ||||

Well before concerns about corporate tax havens were being seriously raised, money was flowing to and fro in this fashion. The drug cartels sent cash out of America, writes Shaxson, "in shrink wrapped bills loaded on wooden pallets." And one of the beneficiaries of the system was Richard Nixon whose Committee to Re-Elect The President sent illegal contributions to Mexico, and then sneaked it back through a company in Miami. According to the Solar Navigator website, it was this saga that led the British Guardian newspaper to dub such transactions "laundering." 

A 1998 UN report described another example: 

|||| Franklin Jurado, a Harvard-educated Colombian economist, pleaded guilty to a single count of money laundering in a New York federal court in April 1996 and was sentenced to seven and a half years in prison. Using the tools he learned at America's top university, he moved $36 million in profits, from US cocaine sales for the late Colombian drug lord Jose Santacruz-Londono, in and out of banks and companies in an effort to make the assets appear to be of legitimate origin.

Jurado laundered the $36 million by wiring it out of Panama, through the offices of Merrill Lynch and other financial institutions, to Europe. In three years, he opened more than 100 accounts in 68 banks in nine countries: Austria, Denmark, the United Kingdom, France, Germany, Hungary, Italy, Luxembourg, and Monaco. Some of the accounts were opened in the names of Santacruz's mistresses and relatives, others under assumed European-sounding names.

Keeping balances below $10,000 to avoid investigation, Jurado shifted the funds between the various accounts. He established European front companies with the eventual aim of transferring the "clean" money back to Colombia, to be invested in Santacruz's restaurants, construction companies, pharmacies and real estate holdings. ||||

Wikipedia puts some numbers on it all: "Tax havens have 1.2% of the world's population and hold 26% of the world's wealth, including 31% of the net profits of United States multinationals. . . The IMF has said that between $600 billion and $1.5 trillion of illicit money is laundered annually, equal to 2% to 5% of global economic output."

While the illegal drug trade might not compete in numbers with corporate tax laundering, it is hardly insignificant. Its size has been estimated at $400-$500 billion, roughly that of the legal pharmaceutical industry or twice as large as Saudi Arabia's annual oil exports. 

What is astounding about this is that an industry so big would have - at least if you only listen to law enforcement and the media - no lobbyists in Washington, no political agenda and make no contributions to politicians. Based on the way the story is being told to America, the illegal drug trade must be the most politically ethical business in the land. 

In fact, of course, the money and its travels are just well hidden and nobody in the establishment really wants you to spend the slightest time worrying about it. Just like nobody in the establishment seems to care that the drug war hasn't worked at all for four decades (money launderer Richard Nixon first used the term in 1971). And just like only a handful seem concerned about offshore tax havens. 

If it were otherwise, then there would have been far more interest when an investigator discovered in the 1990s that the Development Financial Authority of the drug-infested state of Arkansas had made an electronic transfer of $50 million to a bank in the Cayman Islands. At the time Grand Cayman had a population of 18,000, 570 commercial banks, one bank regulator and a bank secrecy law. It was a favorite destination spot for laundered drug money.

One of those bringing drugs into Arkansas was Barry Seal, then the biggest drug importer in the country. He was murdered and after his death it was found that among his bank accounts was one in the Cayman Islands branch of the Fuji Bank containing $1.6 million. 

There are no culpable names mentioned here, in part because so few in the media or law enforcement have the slightest interest in following the money. 

On the other hand, there is simply no logical reason to assume that politicians and law enforcement officers are somehow exempt from the extraordinary temptations involved in offshore money laundering. Every way that the drug cartels are using offshore financing is also available to corrupt politicians.

Consider, for example, the huge fees some American politicians are paid when they speak abroad. What a great way to launder some money. Or what if the purchasers of those endless political memoirs by failed politicians include mass purchases by corrupt interests? 

So far, we're certainly far more polite about it all than, say, Mexico. But scrape the surface just a bit and you'll find an illegal system as massive and political corrupt as our neighbor to the south. 

And one of the telling signs is that the facts are there but so few in America's establishment or media even want to talk about it.

April 16, 2011

All politicians left behind in math

Sam Smith

The story got nowhere near the attention it deserved, but after Obama and Boehner declared that their budget agreement would produce a $38 billion savings, the Congressional Budget Office estimated that the effect would be about $352 million - or less than one percent of the amount the politicians claimed.

How can one possibly have a workable government - let alone a reasonable budget - when the numbers being used are that far apart? And when the media gives it token mention and moves on to the next press conferences?

This is not a debate. This is not a difference in ideology or an adut conversation. This is adult insanity.

As noted here before, we are really living in a new Middle Ages in which life is being driven by myths rather than reality. And where reality is generally considered irrelevant, unsophisticated or perverted.
The media has slipped hopelessly into this morass, witness this from the Washington Post: "Obama acknowledged that the debt must be tackled faster than he has previously proposed."

As Dean Baker - one of the isolated sane - observes: "It is only possible to 'acknowledge' something which is true. The Post obviously believes it is true that 'the debt must be tackled faster than he has previously proposed,' but that does not make it so. This is the Post's opinion."

Baker goes on to note: "Remarkably, the coverage of the President's [budget] speech in both the Post and the NYT included no mention of the recession. The main reason that the deficit has soared in the last three years is because of the economic collapse that followed the crash of the housing bubble.

"If the deficit is reduced substantially before the economy has gotten back to near full employment levels of output, the main effect will be to slow growth and throw more people out of work. This fact was never mentioned in either piece even though President Obama proposes to have his deficit reduction targets to become binding in fiscal year 2014, a point at which the unemployment rate is still projected to be 7.2 percent. "

It is one thing to have Republican corporate hit men treating facts with such indifference, but when Obama, the NY Times and the Washington Post, join in the fantasy, your chances of a realistic solution from the capital are pretty much over.

It is one thing to have someone like Senator Kyl declare that Planned Parenthood spends 90% of its fund on abortions (instead of the actual 3%) and then to have his office declared that "his remark was not intended to be a factual statement," but when a Democratic president is 100 times off from a Congressional Budget Office analysis you have what they call in Washington a serious structural problem.

April 11, 2011

Mending my ways

Sam Smith

I'm sorry. Now I understand. Until last week's budget deal, I never really appreciated the importance of adult conversation, bipartisanship, moderation and calming a bunch of bullies by giving up everything you promised the voters.

I'm going to try to mend my ways. From here on out, I'm only going to advocate policies that have at least majority support with the American people. I hope President Obama, and the media that so admires his lofty elevation above all debate, will join me.

In keeping with this standard I propose for starters that we raise to the top of the agenda the following items most Americans say they want:

Gay marriage

A faster withdrawal from Afghanistan

Legalized marijuana

An end to corporate personhood

Increasing taxes on the wealthy

No cuts in Social Security.

An end to capital punishment

Mr. President, would you join us mainstream Americans for an adult conversation on these matters?

If not, could you advise us as to which programs we should threaten to abolish in order to get your attention? We're kind of new to this maturity thing.

April 10, 2011

Recovered history: the next stop after Hope

Sam Smith

The best piece of political fiction in modern America is still Bill Clinton. Much of the narrative he wrote himself, but a deeply embedded national media distributed it widely and made sure that reality didn't intrude too much.

The tale began in Hope, Arkansas. As Clinton said when first nominated, "I still believe in a place called Hope." The National Park Service would eventually give his birthplace official landmark status. And everyone knows about Hope.

What they don't know is that when he was seven, Bill and his mother moved to Hot Springs.

Hot Springs would become the first of innumerable deletions or brush overs from the official Clinton story, but it came back to mind the other day when a memoir by Dora Maxine Temple Jones arrived on my desk.

It was a 2008 edition of a book originally published in 1983, when Clinton was still a young politician. Dora Maxine Temple Jones was already ill and past her prime as Clinton got started.

Nonetheless, the book will tell you more about the real Bill Clinton and where he came from then most of the hundreds of thousands of words that have been devoted to the topic. Further, it's the sort of book that should be required reading in every American political science course. And isn't.

Maxine, you see, was the top madam of Hot Springs, in the heart of one of most corrupt states in the union. It was, to be sure, a simpler period, with gambling and prostitution the lead enablers. By the time Clinton became chief executive, these sins had been replaced by drugs, with the state becoming of the leading importers and with the governor's prime assignment - as in earlier times - to look the other way. A pilot would tell a reporter that he loved bringing drugs into Arkansas and gave as an example the time he landed in a pasture with his pickup being a state trooper in a marked car.

There is no way to understand the Clinton story without the Hot Springs context, and Maxine tells it in an amazing fashion. Her clients included a federal judge, senators and representatives. Writing in 1983, she said, "Some of them have been in Washington for years, and some are still there."
Hot Springs was the southern recreation center for America's underworld and for those wishing to escape more visible and moral climes.

"My guests included local businessman, doctors, and many top officials form the state.

"One such official was the attorney general, Beauregard Clochard (his name changed by the author). We did each other a lot of favors during his term in office and he did a lot of special favors for Garland County officials while he Attorney General.

"Prominent underworld figures from the East and the West coasts were also among my clientele. . .They'd fly into Hot Springs, go to their hotels, and then hire a limousine to drive them to the Mansion. They always respected me and liked me. They were the best customers I had; they were generous with their money and conducted themselves in a gentlemanly and respectful fashion towards my girls.

"They were polite and even kind. I admired them; they were my kind of people. You would never had guessed that they were underworld figures or hired killers."

The book is riddled with examples of trade-offs, pay-offs and favors:

"When election day came I loaned by Cadillac to a cab driver. He hauled people all over town to the polls to put in the people I wanted. Back in those days you could do a little stealing in the voting situation, so they would take my girls to one poll to cast their vote, and then across town to another polling place, and they'd vote for them again."

Maxine was tough and did things her own way, symbolized by the fact that when she was just a prostitute, she steadfastly refused to remove her bra. Most anything else was permitted.

It all fit in with the Hot Springs I had described back when Clinton was in office: 

|||| In the 1930s, Hot Springs represented the western border of organized crime in the U.S with the local syndicate headed by Owney Madden, a New York killer who had taken over the mob's resort in Arkansas. Owney Madden was an English born gang member who had been arrested more than 40 times in New York by the time he was 21. Madden got the assignment from his boss, Myer Lansky. The plan for Arkansas was modeled on an earlier one in which Governor Huey Long opened a Swiss bank account into which the mob would put $3 to $4 million annually for the right to run casinos in the state. Lansky then moved to Hot Springs where he hired Madden, former operator of Harlem's Cotton Club. According to one account, "The Hot Springs set up was so luxurious and safe that it became known as a place for gangsters on the lam to hole up until the heat blew over."

Hot Springs was also where Lucky Luciano was arrested and brought back for trial prosecuted by Thomas E. Dewey. According to one account, "Dewey proclaimed Luciano Public Enemy No 1, and a grand jury returned a criminal indictment against him that carried a maximum penalty of 1,950 years. . . He was arrested in Hot Springs, Arkansas, and extradited back to New York. There, in the New York State Supreme Court, he was tried, and on June 7, the verdict of guilty was returned. ||||
Another description added:

|||| There is evidence that many syndicate groups became involved in Hot Springs. Owney Madden was the overseer of everything and watched out for the New York mob's interests. Morris Kleinman, who was one of the founding gangsters of the Cleveland syndicate spent much time in Hot Springs. It is rumored that the Cleveland boys had pieces of the profits from Hot Springs gambling. Johnny Roselli, an "upper level" member of the Chicago mob was a silent partner in many Hot Springs casinos in the 1940's and 1950's, as was Frank Costello. All of these groups used local operators as "fronts", a system perfected by the Cleveland syndicate in Ohio, Florida, and Kentucky. Since Hot Springs was a very popular tourist spot, the command went out from the different syndicates that there should be no murders carried out in Hot Springs. This would be the rule in Las Vegas too. If bodies littered the streets like in Chicago, it would only hurt business. Also "petty" crimes like burglary and armed robbery were not to be tolerated. If the suckers weren't comfortable, they wouldn't come to Hot Springs.

Owney Madden laid the groundwork for gangsters on the lam to hide out in Hot Springs. The city had a resort-like atmosphere and elegant nightlife, with people coming and going all the time. This was the perfect situation to "hide" mobsters who couldn't be seen in their hometowns. Al Capone would stay at the Arlington Hotel when things got too hot in Chicago. |||
Hot Springs Business Men's Social Club, aka Maxine's
Maxine's troubles - including ending up in prison at one point - were basically those of a local small business operator up against the mob - compromising, paying off, trying to hold her own. And Owney Madden (Oney, she calls him) is mentioned numerous times in her tale.

A Clinton is only mentioned once in the book.

Her first attorney - she calls him Uriah Toper - didn't look respectable enough for her tastes. So she bought a new set of clothes for him at Dan's Men's Store and then told him:

"Mr Toper, you need a new car. I'm supposed to be the high classed madam of this town and if you're going to represent me I want you to look like a high classed lawyer. . . Let's go down to Raymond Clinton's Buick place and get you one." And they did, paid for in cash.

Raymond was Bill's uncle. Clinton's stepfather had been a gun-brandishing alcoholic who lost his own Buick franchise through mismanagement and pilfering. He physically abused his family, including the young Bill. His mother was a heavy gambler with mob ties. According to FBI and local police officials, Uncle Raymond -- to whom young Bill turned for wisdom and support -- was a colorful car dealer, slot machine owner and gambling operator, who thrived (except when his house was firebombed) on the fault line of criminality.

Among other things he ran the Belvedere Club. Gail Sheehy would politely describe it this way: "The club offered the full menu of wink-wink 'illegal' pleasures, liquor, crap tables, waitresses who could be persuaded to get familiar with the customers."

Raymond also helped Clinton's mother get started in nursing by providing her with prostitute clients. Virginia especially liked Maxine's crowd, explaining once that "Mister president of the bank might not pay me on time, but Maxine's girls would."

Bill Clinton's mother loved Hot Springs because, "I'm not one for rules, and the only rule in Hot Springs was to enjoy yourself - a rule I could handle." On another occasion, she remarked, "Hot Springs was so different. We had wide-open gambling, for one thing, and it was so wide open that it never occurred to me that it was illegal - it really didn't - until it came to a vote about whether we were going to legalize gambling or not. I never was so shocked."
And when Governor Winthrop Rockefeller took over and shut down the illegal gambling (with help from Maxine whom he had pardoned) one of Virginia's friends complained, "the Puritans ruined this town."

Only months out of Yale Law School, Bill Clinton returned to Arkansas to run for Congress. Author and investigative journalist Roger Morris described what happened next: 

||||| A relative unknown, he faces an imposing field of rivals in the Democratic primary, and beyond, in the general election, a powerful Republican incumbent. Yet as soon as he enters the race, Mr. Clinton enjoys a decisive seven-to-one advantage in campaign funds over the nearest Democratic competitor, and will spend twice as much as his well-supported GOP opponent. It begins with a quiet meeting at his mother's house in Hot Springs. Around the kitchen table, as Virginia Clinton will describe the scene, avid young Billy meets with two of his most crucial early backers -- uncle Raymond G. Clinton, a prosperous local Buick dealer, and family friend and wealthy businessman Gabe Crawford. As they talk, Mr. Crawford offers the candidate unlimited use of his private plane, and Uncle Raymond not only provides several houses around the district to serve as campaign headquarters, but will secure a $10,000 loan to Bill from the First National Bank of Hot Springs - an amount then equal to the yearly income of many Arkansas families. Together, the money and aircraft and other gifts, including thousands more in secret donations, will launch Mr. Clinton in the most richly financed race in the annals of Arkansas -- and ultimately onto the most richly financed political career in American history.

Though he loses narrowly, his showing is so impressive, especially in his capacity to attract such money and favors, that he rises rapidly to become state attorney-general, then governor, and eventually, with much the same backing and advantage, president of the United States . . . No mere businessman with a spare plane, Gabe Crawford presided over a backroom bookie operation that was one of Hot Springs' most lucrative criminal enterprises. [And the] inimitable Uncle Raymond - who had also played a pivotal behind-the-scenes role in keeping young Bill out of the Vietnam draft - was far more than an auto dealer. In the nationally prominent fount of vice and corruption that was Hot Springs from the 1920s to the 1980s (its barely concealed casinos generated more income than Las Vegas well into the 1960s), the uncle's Buick agency and other businesses and real estate were widely thought to be facades for illegal gambling, drug money laundering and other ventures, in which Raymond was a partner. He was a minion of the organized crime overlord who controlled the American Middle South for decades, New Orleans boss Carlos Marcello or "Mafia Kingfish" as his biographer John Davis called him.|||||

As Paul Bosson, a Hot Springs prosecutor, would put it, "In Hot Springs, growing up here, you were living a lie. You lived a lie because you knew that all of these activities were illegal. I mean, as soon as you got old enough to be able to read a newspaper, you knew that gambling in Arkansas was illegal, prostitution was illegal. And so you lived this lie, so you have to find some way to justify that to yourself and, you now, you justify it by saying, "Well," you know, "it's okay here."

Some of the operations were quite complex. Say the syndicate had a rich guy from Dallas who had just lost $10,000. He offered to write a check, but the syndicate would instead fly him back to Dallas accompanied by one of its girls to pick up the money in cash. Liquor would flow as well and, often as not, the gambler would come back with the $10,000 plus more to lose.

Maxine survived on a strong but attractive personality, bribery, proto-feminism, and blackmail. The fact the Hot Springs was a no-kill zone for the mob probably didn't hurt, either.

I first heard about this distinction from investigative reporter Dan Moldea who had once gotten word in Michigan that, because of his aggressive reporting, there was a hit out on him. He went to the FBI whose agents told him there wasn't much they could do until he got hit, but that he might think about moving to one of the neutral cities - places that were off limits for mob murders. Hot Springs had fallen off the protected list by then, but Las Vegas, Miami, and Washington were the three mentioned. Moldea moved to DC.

In any case, Maxine stood up for herself. When her lawyer became a judge who tried to get her to close her place, she told him, "You're not going to make me a scapegoat just because I wouldn't pay off the syndicate."

Later she confronted Judge Toper, then accompanied by the sheriff: "I'm going to tell you something, Mister Bigshit. You may be a judge now, but you represented me for twelve long years. You took my money that came out of the whorehouses.. . .Has the syndicate got you under their thumb?"

She gave the judge and the sheriff until six o'clock that evening to close every other whorehouse in town or "I'm going to Little Rock to the newspaper and tell them what's going on."

They agreed and she shut her place as well: "At six pm, you never saw so many whores going out of town on buses and planes in your life."

Some time late a grand jury was called, but her testimony nowhere as secret as she thought. A microphone had been hidden so that Owney and other mobsters awaiting their turn could hear what she had to say.

On another occasion, facing trial after a raid on her place, Maxine's lawyer confronted the prosecutor, "Dennis, if you don't lay off Maxine. . . I'll have her tell how many times you've been in her whorehouse and gone to bed with her girls."

Then he added, "You didn't have natural relations with hose girls, either. There was a picture made of you with your head down between their legs."

Maxine even took on the FBI, obtaining Attorney General Bobby Kennedy's private phone number to ask that he send some clean agents down to deal with syndicate. Kennedy sent a squad to the scene, but the syndicate had already pulled back.

Maxine had some friends among the cops - such as sheriff's deputy Kyle Mason who drove her to start a prison term. He remarked, "You know, Maxine, if it wasn't for losing my job, I'd let you get out of this car and catch the next plane to Mexico."

When she came up for parole, however, the situation was a bit different. Every member of the parole board had been at her whorehouse and one of them said, "Maxine, we can't let you got right now. The governor's coming up for reelection. We'll just keep you a few more months and til the next heard, and then we'll let you go."

Out of prison, she confronted the mayor in his office: "Remember this. If you bother me again, I'll have that goddamned house of your blown up and your family along with you. Put that in your little hat and think about it. . . By the way, if you ever repeat this to anyone, it'll get back to me, and I’ll have it done anyway." The mayor and the cops left her alone.

And to an FBI agent: "Listen, honey. You can forget the instruction course on federal law you’re at such pains to give me. I know how to read, too, you know. I'm a professional racket woman, and I make a point of keeping up with all the new laws passed on prostitution."

In the end, Maxine summed it up this way

"Most people think prostitution is a dirty business but I can tell you a profession that makes a prostitute look like a Little Miss Muffett in a child's nursery rhyme book. That profession is none other than politics. . . .

"The best thing that could happen would be to put all the freeloading politicians behind bars and let the whores out so they could do an honest night's work"

Little did she know that instead, and only a few years later, one of the former, raised and well trained in Hot Springs, would be elected president of the United States.

April 07, 2011

My first political lesson

Sam Smith 

For some four decades I argued for an elected district attorney and comptroller in my hometown of Washington DC. This wasn't just an intellectual argument. When I was 12 I took part in my first political campaign, a successful effort to end 69 years of Republican rule in Philadelphia with the election of Joseph Sill Clark as comptroller and Richardson Dilworth as district attorney.

Though both were patrician in name and bearing, in Clark the quality went through to his soul. With Dilworth it stopped with his tailored suits. He was an ex-Marine with a quick temper and a townie accent, who never ducked combat or favored equivocation. After the pair had shaken the GOP regime by winning the offices of comptroller and district attorney, Dilworth got the first chance to run for mayor, with Clark succeeding him and then moving to the Senate.

Dilworth's mayoral race remains a classic. His most notable campaign technique was the street corner rally, which he developed to a degree probably unequalled since in American politics. Using the city's only Democratic string band as a warm-up act, Dilworth would mount a sound truck and tick off the sins of the Republican administration. On one occasion he parked next to the mayor's home and told his listeners: "Over there across the street is a house of prostitution and a numbers bank. And just a few doors further down this side of the street is the district police station. . . The only reason the GOP district czars permit Bernard Samuel to stay on as mayor is that he lets them do just as they please."

At first the crowds were small. But before long he was attracting hundreds at a shot with four or five appearances a night. One evening some 12,000 people jammed the streets to catch the man who would eventually become mayor.

Dilworth on another occasion got into a fist fight with a member of his audience. His wife once knocked an aggressive heckler off the platform with her handbag and, in a later campaign, his daughter picketed the office of the GOP candidate with a sign reading, "Why won't you debate the issues with my father on TV?"

The Republicans responded with sneers, rumors and allegations about Dilworth's liberalism and, in particular, his association with Americans for Democratic Action. The GOP city chairman, William Meade, called ADA communist-infiltrated and `inside pink' where "Philadelphia members of that radical and destructive [Democratic] party have gone underground and joined the Dilworth ranks."

Dilworth's initial reaction was to call Meade a "liar" and to challenge him to a debate. Said Dilworth: "The ADA acted and struck hard against communism while Mr. Meade and his gang created by their corruption the very conditions that breed communism."

But that wasn't enough for Dilworth. To make his point, he marched into the offices of the Republican City Committee and, with press in tow, brushed past the receptionist, and barged into Meade's private office where the chairman was conversing with two city officials. Dilworth challenged Meade to name one Communist in ADA. When Meade demurred, Dilworth said Meade had accused him of treason: "If you want to debate publicly, I'll go before any organization you name. I'll go before your ward leaders. I challenge you to produce evidence of a single Communist or Communist sympathizer in ADA. I say this as one who fought for his country in the Marine Corps. That's more than you did, Mr. Meade."

"Maybe I wasn't physically fit," replied Meade.

Dilworth continued the confrontation a few minutes longer and then stormed out. The red-baiting subsided and the central issue once more became corruption. Dilworth had won and as I read the big black headlines, I thought it was my victory too.

Which is why I was so pleased to learn that Washington has approved by ballot referendum an elected attorney general, albeit not - as is most wisely in the case - chosen in a year when the mayor isn't up for election. It would also help to have the city's inspector general elected and, while we're at it, to have a constitutional amendment to make the U.S. Attorney General an elected position as well.

Since it's taken four decades for Washingoton just to get where it is on the matter, however, I supposed the national AG election will have to wait awhile, but anyone living in a corrupt city that doesn't have elected District Attorneys and comptrollers should definitely get the idea rolling.

Progressive Review censored by Facebook

A reader writes that he tried to to share three different stories from the Review site on Facebook and what came up was this:

"Message Failed. This message contains blocked content that has previously been flagged as abusive or spammy. Let us know if you think this is an error."

This doesn't surprise us. Facebook is the anti-Internet. It is a gated community designed to protect its residents from the incredible variety of  the real Internet. Its guard house is there not to block undesired people, but unwanted information.

In the early days, people had to use corporate sites such as AOL to tap into the Internet. Of course, these sites controlled what you could see or visit. Then came the free and open web and a huge increase in the information available to the average viewer.

Facebook is an attempt to revive corporate control of the Internet, by fooling people into thinking they can get all they want from its links. Of course, one of the prices you pay for this is that a guy named Zuckenberg gets to decide what you see, a guy who thinks the Progressive Review is too dangerous to read.

April 05, 2011

The Mafia in the House

Sam Smith

Raw Story reports that "a new NBC/Wall Street Journal poll found Monday that 76 percent of Americans consider it unacceptable to cut Medicare, while 67 oppose cutting Medicaid, despite their deficit concerns."

On Tuesday, the pluto pimps of the House GOP proposed a budget plan drastically cutting both Medicare and Medicaid.

Why would they take on two-thirds to three-quarters of the public on such issues? Simply because under the new rules of the game, in the wake of the Supreme Court decision on campaign financing, the public no longer matters that much.

The archaic media will continue to play this as an ideological matter, but it is not. The goal of the House Republicans is not fiscal conservativism but governmental elimination in as many forms as possible in order to satisfy its major campaign contributors. If they felt they could get away with attempting to abolish anti-trust, product liability and environmental limits on industrial pollution, they would add them to their list.

The Washington entropic elite will continue to speak of things like the need for "adult conversation" on the budget, but it is hard to have such a dialogue when the other party puts a knife to your throat.

Here's an excerpt from the Washington Post description of the budget plan:
|||| The proposal urges a sweeping transformation of federal health programs that would wipe out funding for Obama’s health-care initiative and end Medicare as an open-ended entitlement. Medicare, the federal health program for the elderly, would be replaced for those under age 55 with a system of premium supports to buy insurance policies in the private market.
Medicaid, the health program for the poor, would come in for sharper cuts, totaling $771 billion over the next decade.

On discretionary spending, Ryan’s plan would match Obama’s call for Pentagon and war funding, but it proposes major cuts to domestic programs totaling $1.6 trillion over the next decade - holding growth in education, transportation, justice, food safety and other programs well below the rate of inflation.

Ryan also proposes to overhaul the tax code, lowering the top rate for individuals and corporations from 35 percent to 25 percent. . .

Ryan also rejects calls to raise taxes on high earners to finance Social Security benefits at their current levels, one of the most popular methods of repairing the program’s finances. ||||
Admittedly, the Democrats have enabled some of the attack. After all, Clinton wantonly dismantled welfare programs and Obama resurrected the horrible Alan Simpson from his blessed obscurity to help undo Social Security.

Still, if the Ryan budget plan were to pass, it would be perhaps the greatest political assault on the federal government since the South seceded. It's aim is to weaken government in every form possible as quickly as possible, reversing 80 years of American political progress. The sole beneficiaries would be the ultra wealthy - whether as individuals or as institutions with LLC and Inc after their name.

In fact, such legislation would also be an act of reckless and willful manslaughter since it would inevitably result in the deaths of thousands of Americans stripped of needed support.

While manslaughter is not a legally defined criminal offense as long as it's carried out as a legislative act, what the House Republicans are doing such be regarded in every other regard as crime rather than politics. They are simply serving as the Mafia hit men for America's hyper elite.