Corruption Digest - December 19, 2005

As my new book Hostile Takeover prepares to be released in the Spring, here is your December 19, 2005 briefing on how America's political system is being sold to the highest bidders. To sign up to receive the Corruption Digest in your email box, just go to www.davidsirota.com and enter your email address on the righthand side.

WHITE HOUSE CORRUPTION
The Toledo Blade kicks off a major series on how President Bush has used the power of the federal government to reward his biggest campaign fundraisers (called Rangers & Pioneers). In the first overview piece, the paper notes "Bush administration policies, grand and obscure, have financially benefited companies or lobbying clients tied to at least 200 of the president's largest campaign fund-raisers...Dozens more stand to gain from Bush-backed initiatives that recently passed or await congressional approval." The investigation included targeted tax breaks, regulatory changes, pro-business legislation, high-profile salaried appointments, and federal contracts. In a subseqent story about the specifics, the Blade notes that "since Mr. Bush took office in 2001, the federal government has awarded more than $3 billion in contracts to the President's elite 2004 Texas fund-raisers, their businesses, and lobbying clients." Earlier this year, the Blade reported that "Mr. Bush's top Ohio fund-raisers collected more than $1.2 billion in taxpayers' dollars for their companies and lobbying clients." The Blade also reports that the Bush administration has showered some of these donors with taxpayer cash and favors despite them being under criminal investigation a...The Financial Times reports that Washington is abuzz with chatter about whether longtime Bush confidant and former Commerce Secretary Don Evans will sell out and become the head of Russia's state-owned oil company. One friend and former Evans colleague admitted that "The reality is the Russians want something that he should not feel comfortable delivering" - namely, U.S. government contacts, and potentially knowledge of sensitive energy information. Hilariously, a former U.S. government official, seemingly oblivious to how corruption is becoming a major political issue, said "The fact that he would be cashing in his political connections is not the problem." The only problem, he said, would be "doing it in a foreign county."...The Washington Post's Ruth Marcus suggests President Bush take up the call of lobbying reform in his 2006 State of the Union. She writes: "It sees unlikely, I concede, that the president will choose to take up this cause. But maybe -- as with Nixon going to China -- George W. Bush is just the right president to go after lobbyists."

CONGRESSIONAL CORRUPTION
The Missoulian reports "U.S. Sen. Conrad Burns first pushed for a tribal school construction program sought by lobbyist Jack Abramoff's clients within two months of receiving $75,000 in campaign donations from the indicted lobbyist's tribal clients in 2002...Burns has said Abramoff's campaign donations had no bearing on his support for a controversial grant he supported, and that he was supporting it because of official requests from Michigan's Senators. But "according to letters released from both Burns and Sen. Robert Byrd, D-W.Va., Burns began advocating for the program more than a month before he received official requests from the Michigan delegation for grant money."...The most recent Burhs story highlights another story by the New York Times about how "political strategists working for likely challengers in several 2006 Congressional races have said they intend to publicize the donations" from indicted lobbyist Jack Abramoff to incumbents...The LA Times' Jonathan Chait points out just how ridiculous it is for President Bush and congressional Republicans to claim that the Abramoff scandal involves both parties equally. "Republicans were happy to broadcast their close ties to lobbyists back when they brought little scrutiny and lots of money," Chait writes. "Now that Abramoff and other lobbyists are suddenly a political liability, Republicans are retroactively happy to share power with the other side. If they'd been a bit less greedy then, they'd be in a bit less trouble now."...AP reports that Senate Majority Leader Bill Frist (R-TN) used an AIDS charity he created to siphon "nearly a half-million dollars in consulting fees to members of his political inner circle."...AP reports "A state district judge said Saturday he will not immediately consider separating two criminal charges against Rep. Tom DeLay to allow an early trial, another blow to the former House majority leader's hopes of regaining his post."

CORRUPTION INDUSTRY
Reuters reports that newspapers are dropping a second columnist, Peter Ferrara, who now admits to being paid by Jack Abramoff to write favorable opinion pieces about Abramoff's clients. Incredibly, Reuters also notes that "the columnist told BusinessWeek Online last week that he takes payments from lobbyists 'all the time' to write articles favorable to their clients and did not see anything wrong with the practice."

CORPORATE CORRUPTION
A secret letter from pension funds to the SEC obtained by USA Today details just how much CEOs are ripping off their shareholders. As the story notes, research shows "that CEO pay at many companies in the Russell 3000 index (representing 99% of the U.S. stock market) bore no relation to how well those companies performed...At 60 of the worst-performing companies in that group, which lost $769 billion in market value over the past five years, the aggregate pay for the top five executives of those 60 companies over the same period was $12 billion. In other words, since January of 2000, some 300 executives who were responsible for more than three-quarters of a trillion dollars in shareholder value vanishing were rewarded by their shareholders with salary, bonuses and stock options worth $12 billion."...Businessweek reports "A judge Friday refused to muzzle out-of-court statements related to the fraud and conspiracy case against Enron Corp. founder Kenneth Lay and former CEO Jeffrey Skilling after Lay's speech Tuesday lambasting government tactics in pursuing him."

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