“The Marriage from Hell: Jane Harman & the Woodrow Wilson Center�

Last year investigative journalist David Boyajian wrote two exposés on Washington-based Woodrow Wilson International Center, revealing how the center has been violating its Congressional mandate and been up to its neck in tainted corporate cash. You can read Boyajian’s exposés here and here. Many agreed with Boyajian’s damning assessment, including a prominent journalist who called the WWC “a global joke.� I too wrote a follow up article on WWC with a special focus on its ‘oily’ President, Mr. Lee Hamilton. By oily, I mean ‘glisteningly greasy.’ I am sure you recognize his name from his highly publicized position and face as one of the 9/11 Commissioners, but his possibly pay-off position with WWC was not the lone factor for his glistening status in my report. Here are a few excerpts from my piece to illustrate what I mean:

Fortunately one independent reporter researched and reported on one such case, call it ‘chased the egg,’ on one of the 9/11 Commissioners, a Former Representative, Mr. Lee Hamilton, which I happened to come across yesterday. It was truly interesting to see how many ‘honorary’ positions Mr. Hamilton has been given, handed, by our government alone, just check out a few here:

-Co-chair of the Department of Energy Blue Ribbon Commission on America’s Nuclear Future with Brent Scowcroft

-Serves on the President’s Intelligence Advisory Board & the FBI Director’s Advisory Board,

-Serves on the US Department of Homeland Security Task Force

- Serves on the CIA External Advisory Board

The White House, the CIA, and the FBI must have been extremely well-served by Hamilton’s performance as the commissioner to grant him this many prestigious quasi positions. No? For me, the most interesting aspect which was covered by CounterCurrents.Org had to do with Hamilton’s position with and current salary from the Woodrow Wilson Center, and his questionable corporate ties, particularly with BAE Systems, the main sponsor of his forthcoming gala dinner…

You can read my entire article ‘9/11 Commissioner’s Turkey Baste: Chicken or the Egg?’ here. Now back to the focus of this post.

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Beating a Dead Horse?

Some recent and not-so-recent news items help reinforce the arguments for broader audits of the Federal Reserve.

The Government Accountability Office recently issued two special audit reports relating to the Fed’s activities leading up to and amidst the recent financial and economic crisis.  The reports from those audits outlined the breathtaking scope of the Fed’s bailout (“rescue�?), and also described some of the conflicts of interest arising within the Fed while pursuing those efforts.  But these audits were constrained by the law that required them (Dodd-Frank).

A congressional effort remains underway to broaden the scope and deepen the authority of Congressional oversight of the Fed.  This effort is resisted by defenders within and attached to the Fed, with some of their most important arguments rooted in concern that the Fed’s operations should retain their ‘independence’ from murky political forces.

Three interesting but little-discussed topics related to Fed independence matter for the effort to develop a more strenuous audit.  They include a recent scolding of a large accounting firm, a curious Fed income statement line item, and some older information from visitor logs.

Peek-A-Boo!

When faced with demands for audits, the Fed and the public frequently have to deal with shrill but sometimes-uninformed complaints that “the Fed isn’t audited.�  The Federal Reserve Banks have internal auditors, and the Reserve Banks are also overseen by the Federal Reserve Board of Governors, a government agency.  The Federal Reserve Banks produce financial statements, and those financial statements are audited by independent accounting firms.  And the Congress has directed the Government Accountability Office (GAO) to conduct special Fed audits in the past.  The Fed frequently points to these facts in its defense.

But existing audit mechanisms could still be inadequate, particularly in light of special issues relating to the financial crisis, such as the prices paid for risky securities that the Fed has purchased in its open market operations in massive quantities recent years.  The law currently puts monetary policy out-of-bounds for GAO audits, for example, and the GAO was so constrained in the most recent audit on this score as well.

And several weeks ago, a news item arose that undermined one of the defenses that the Fed uses to deflect demands for more forceful Congressional oversight and auditing.

The Public Company Accounting Oversight Board (the PCAOB, sometimes referred to as PeekABoo) was created by law in 2002 in response to the Enron and related scandals.  The PCAOB is directed to oversee the work of public accounting firms.  The PCAOB issues standards, examines auditors, and pursues enforcement actions.  In mid-October, the PCAOB released a previously-private portion of an inspection report of Deloitte Touche LLP, one of the largest accounting firms in the world – and the firm that audits the Federal Reserve Banks.  The release of this previously-private portion of its inspection report indicated that the PCAOB found insufficient progress at Deloitte in addressing issues for which it was cited in previous years. Read more È

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American voters disagree on many issues but nearly all agree that government’s performance has been abysmal.

Americans’ satisfaction with the way things are going in the United States has fallen back to 11%, the lowest level since December 2008 and just four percentage points above the all-time low recorded in October 2008…The all-time low of 7% came in an Oct. 10-12, 2008, poll, conducted shortly after stock values plummeted following Congress’ passage of the TARP legislation in response to the September 2008 financial crisis. (Gallup.com, August 18, 2011)

The data show that public confidence fell most sharply when the President and Congress rejected majority public opinion on economic issues, namely bank bailouts and federal debt reduction. Those were not the only disappointments, by any means. On a variety of issues, from healthcare reform to credit card legislation, government officials have given lip service to the wishes of their constituents.

Political commentators and candidates for political office regularly attack government officials as inept.  President Bush was labeled incompetent. President Obama is criticized as a poor negotiator.  Democrats, in general, are described as weak while Republicans are viewed as cold-hearted. Unsurprisingly, that is how voters perceive the parties, also.

Few of these politicians were really incompetent. Many failed to produce the results voters said they wanted.  But, that may be because the politicians were serving a different constituency: a wealthy corporate elite.  With a coterie of lobbyists constantly tugging on their strings, political puppets are bound to appear clumsy. They know how to get what they want, though. Most freshman members of Congress are millionaires, after all.
The only downside for political puppets is the possibility of voter backlash at election time. Economically, however, politicians are well-insulated from public displeasure. Whether they are booted from office or decide to retire, they can look forward to cushy jobs with corporations, corporate lobbies, and corporate-funded think tanks.

Elected officials have another incentive to be responsive to corporate lobbying:  their stock portfolios. For example, eight members of Congress hold $50,000 or more in Apple stock, reports OpenSecrets.org (August 25, 2011), and one of the eight (Nancy Pelosi) reportedly has Apple stock worth $1 million or more. Observers have noticed that Congressional investments out-perform the stock market and even out-perform investments held by corporate insiders.

Some outraged citizens have called for mass demonstrations.  But, demonstrations against government policies tend to fail when the policies are profitable for corporations, observes psychologist Bruce Levine. In his book, Get Up, Stand Up, Levine writes: Read more È

I’ve been meaning to write about this for weeks, and just got around doing it. Maybe the subconscious procrastination was due to the conscious sanitization of this news by venues like this. Maybe it was the dread of having to tackle one of the quasi media phony darlings like this guy. Or maybe it was the repressed exhaustion-frustration I went through a couple of years back with this. Okay, allow me to start with the fairly recent development reported ‘incompletely and badly’ by the New York Times:

Representative Jean Schmidt, Republican of Ohio, has been ordered by the House Ethics Committee to repay a Turkish-American group $500,000 for legal services it improperly paid for to help her pursue a defamation lawsuit and other legal proceedings against a Democratic opponent in the 2008 election.

As you can see, very consciously the Times avoids naming ‘that Democratic opponent.’ Because naming him, David Krikorian, would require some fact citing and more context-background on the case; the case they together with the rest of the mainstream media went out of their way to black out. And doing ‘that’ would God forbid bring up the long-blacked-out state secrets privilege in my case. And ‘that’ my dear friends, is something that has been forbidden to these stenographers in the media circus.

So let’s continue the no-coverage coverage of a very significant case involving Congresswoman Jean Schmidt and the twisted and rechanneled Turkish Foreign Lobby dollars:

The action by the House committee, disclosed Friday, did not come with a formal punishment, because ethics investigators concluded that Ms. Schmidt had been misled by her own lawyers from the Turkish American Legal Defense Fund about who was paying the legal bills.

Ms. Schmidt was ordered to amend her annual personal financial disclosure reports to acknowledge the gift from the Turkish Coalition of America, which actually paid the bills, and then reimburse the lawyers.

 The report above casually, and very quickly, glosses over one of the implicated, that is, directly implicated, parties in this case: Schmidt’s lawyer- the lawyer who supposedly, and intentionally, misled his client, and did so with a dollar amount not in the thousands, but actually half a million dollars. Ordinarily this slip by a government garbage disposal facility like the Times would not raise big flags. However, this lawyer is no ordinary lawyer. The lawyer in question here happens to be a famous, very public, high-profile and very deviously and shrewdly marketed man. The lawyer in this case is none other than deceivingly perceived Bruce Fein.  A man who has gotten very wealthy thanks to the foreign lobby, in this case the Turkish lobby in need of a man who knows the maze that gets the cheese to the congressional mice:

In 2007, Ayasli transferred $30 million in stock to fund a new endeavor, the nonprofit Turkish Coalition of America. The organization is headquartered in a Washington suite that has also been listed as the address for the Turkish Coalition USA PAC, the lobbying firm of Lydia Borland (who has represented the Turkish government), and the law firm of Bruce Fein and Associates (Fein comprises half of the Turkish American Legal Defense Fund).

…

In addition to the advocacy done through the ATC (which also funds trips to Turkey for congressional staff), a handful of its members–Citigroup, BAE Systems, Northrop Grumman, Chevron, Textron, United Technologies, Lockheed Martin and Raytheon, which spent a combined $80 million lobbying Washington last year lobbied Congress directly on the genocide resolution and other issues important to Turkey; the Aerospace Industries Association, a trade group, helped coordinate the effort.

…

Oh wait, Bruce Fein is married to Mattie Fein, the Republican candidate who ran against Jane Harman in 2010. Had she won, how would one go about calculating and deducting her campaign-donation  ‘gifts’ from her husbands million-dollar foreign lobby gifts? Isn’t it interesting? And as far as Turkey’s former partner lobby, the Israeli Lobby, this is where Bruce & his voluptuous wife stand when given the Zionism litmus test:

7. Would you support Israel taking military action to stop Iran from obtaining nuclear weapons? Under what circumstances?

The United States should support whatever Israel believes is justified by national security worries over Iran.

I know Mr. Fein has many pro-liberties fans out there who are mistaking him for ‘real;’ some consider him a real constitutionalist who stands for liberties and against secrecy. That’s very similar to those who fell for Obama the constitutionalist. Remember, Obama the author of a very constitutional book? Recall the beautiful words spoken and sold as pro liberties, pro change, anti secrecy and beyond? Well, you have a similar situation with Mr. Fein: he talks a good talk, and writes well. As for who Mr. Fein is: you are looking at a man long succumbed to foreign lobby and military industrial complex lobby dollars. You are looking at a man far more loyal to Israel and its lobby than to our nation. You actually have a man who believes any war would be justified for the sake of Israel. And in the latest Schmidt case you are looking at a man who helped funnel half a million dollar foreign ‘Bakshish’ to his congresswoman friend, and even indicted by the lame Congressional Ethics Committee as an attorney who intentionally misled his client. Read more È

 In the debate on reducing the national debt, members of Congress have focused on two options–tax increases and entitlement cuts—both considered unhelpful to restarting a stalled economy.  Congress seemingly has forgotten that it has another option for reducing the debt: eliminating waste, fraud and corruption in government programs. Perhaps, Congress knows that the success of such a plan would correspond with the effectiveness of whistleblower protections—protections it has been reluctant to provide to the thousands of whistleblowers who hold security clearances.

Insiders are critical to identifying government waste, particularly in agencies, such as the Department of Homeland Security, where much of the information is classified and not available for public review.  But, insiders are vulnerable to retaliation from managers embarrassed by their disclosures. The Obama administration has been particularly aggressive toward whistleblowers, launching criminal prosecutions against several of them.

Most Americans would be surprised to know that thousands of federal workers with ordinary jobs–food safety, for example–are required to have security clearances even if they may never handle a classified document.  Agencies pay dearly for the necessary background investigations. But, they just can’t seem to pass up the opportunity to give themselves an end run around civil service laws. Steve Kohn, of the National Whistleblowers Center, writes:

A 1989 law was supposed to protect federal employees who expose fraud and misconduct from retaliation. But over the years, these protections have been completely undermined. One loophole gives the government the absolute right to strip employees of their security clearances and fire them, without judicial review. Another bars employees of the National Security Agency and the Central Intelligence Agency from any coverage under the law. And Congress has barred national security whistle-blowers who are fired for exposing wrongdoing from obtaining protection in federal court.

Knowing that they are vulnerable to retaliation, few federal employees are inclined to report wrongdoing.  Nevertheless, they are required to report wrongdoing.

Every employee takes an oath or affirmation, required by Article VI of the U.S. Constitution to “support the Constitution.� Since 1884, employees have taken this   expanded version of the oath, described in the U.S. Code (Title 5, Chapter 33).

I, [name], do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter. So help me God.

Incredibly, through court decisions and Congressional foot-dragging, civil servants tasked with defending the Constitution are forced to do so with an abridged set of Constitutional protections, particularly with regard to free speech and due process—essential elements for holding a government accountable.

Civilian federal employees also must adhere to the federal code of ethics (Executive Order 12674, as amended).  It states, in part:

“Employees shall disclose waste, fraud, abuse, and corruption to appropriate authorities.�

The code also directs that employees “shall protect and conserve Federal property and shall not use it for other than authorized activities.�  This is important because agencies tend to treat classified information as government property, although it’s more accurate to say that a representative government holds information in trust for its citizens.

Sometimes, classified information contains evidence of waste, fraud or corruption, documents abuses of human rights, or it exposes negligent handling of national security.  In such cases, classifying the information was illegal. Executive Order 13526 forbids classifying information to hide violations of law, inefficiency, or administrative error or to avoid embarrassing officials.

An employee who encounters classified evidence of wrongdoing therefore is compelled to ask, “Which of the applicable laws has priority?â€�  Agencies provide little or no guidance to employees for dealing with the moral hazard dumped in their laps. Think of it as a ticking black box with protruding wires in several colors.  Does one pull the blue wire, the yellow or the red? Pull the wrong one and your career explodes.  Read more È

As some politicians describe it, the Social Security program is an economic disaster forced upon younger generations by the demands of greedy baby boomers. News media obediently parrot the scare stories, seldom questioning the math in a story that is all about the numbers. A rare departure from that script occurred on July 29 when an alert Washington Journal moderator stalled a Businessweek editor’s argument for Social Security cuts by observing that the data he brought with him showed a projected Social Security surplus.[C-SPAN Video: Washington Journal, July 29, 2011. Interview begins at the 28-minute mark.]

Bloomberg’s Peter Coy was on the program that day to discuss his article, Why the Debt Crisis is Even Worse than You Think. Coy described a long-term “fiscal gap� of $211 trillion dollars, which he explained is “the difference between tax revenue…and everything we expect to spend.� His published article provides a bit of additional explanation.

A more revealing calculation is the [Congressional Budget Office’s] measurement of what’s called the fiscal gap. That figure is conceptually cleaner than the national debt—and consequently more alarming. Boston University’s Kotlikoff has extended the agency’s analysis from 2085 out to the infinite horizon, which he says is the only method that’s invulnerable to the frame-of-reference problem.

Social Security, Medicare and Medicaid entitlements bear most of the blame for the $211 trillion shortfall, Coy said. As he spoke, C-SPAN moderator Susan Swain pointed to the article’s accompanying chart of the data, entitled “The Debt Deluge.â€� Seconds later, the wheels came off Coy’s talking points.“You’re saying Social Security is part of the solution,â€� commented Swain. “[But], in this illustration…it shows Social Security with a surplus…right?â€� She pointed to the chart where it clearly indicated a Social Security debt of $110 trillion and projected Social Security receipts of $132 trillion.“ Am I reading that correctly?â€� Swain asked politely.

Weakly, Coy answered, “Yeah.â€� After fumbling for a better response, he concluded by telling Swain that he would look again at the data and provide an explanation the following week. But, the following week, Ms. Swain was not there–a male moderator appeared, instead. Coy did not revisit the $22 trillion surplus and did not offer a correction. Read more È