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March 12, 2007
“I ask, sir, what is the militia? It is the whole people, except for a few public officials.” George Mason, in Debates in Virginia Convention on Ratification of the Constitution, Elliot, Vol. 3, June 16, 1788
On March 9, 2007, a decision came down in the United States Court of Appeals that flashed all across cable networks as breaking news and indeed, it was. My first reaction even though details were limited, was this must be my friend, Dane von Breichenruchardt’s case. Dane is president of the Bill of Rights Foundation in Washington, DC, and is part of a group of appellate attorneys that I knew were involved in an important Second Amendment case. As the details emerged throughout the day, I was ecstatic to see that it was Dane and a group of dedicated Americans who stuck with it and won a huge victory for we the people. I am so happy for Dane, all his colleagues and support staff who worked so hard for so long. Way to go!
“[W]e conclude that the Second Amendment protects an individual right to keep and bear arms.” So said the court and this is a major victory that no doubt caused immediate anger from those who have zero understanding of the U.S. Constitution, the Bill of Rights, the founding of this republic and what the Second Amendment actually means. That would be Comrades Hillary Clinton, Charles Schumer, Diane Feinstein, Teddy Kennedy who uses his car to kill, Handgun Control, Inc., and Brady Campaign to Prevent Gun Violence. Make no mistake: these hucksters and their minions will not give up:
“We’ll take one step at a time, and the first is necessarily – given the political realities – very modest. We’ll have to start working again to strengthen the law, and then again to strengthen the next law and again and again. Our ultimate goal, total control of hand guns, is going to take time. The first problem is to slow down production and sales. Next is to get registration. The final problem is to make possession of all handguns and ammunition (with a few exceptions) totally illegal.” Pete Shields, founder of Handgun Control, Inc., New Yorker Magazine, June 26, 1976, page 53.
I spoke with Dane via telephone on March 10, 2007, about this decision and what comes next? Dane’s response was that it would probably go up to the U.S. Supreme Court. If that court takes the constitutional position, the decision will stand. Of course, if this happens, it won’t stop the gun grabbers and fools in Washington, DC, who think guns are the problem. With the strictest gun laws in the country, Washington, DC, is drowning in crime and killings 24/7. I have been there many, many times and I don’t care how expensive your hotel room or the location, half the night you’re kept awake by sirens from police cars cleaning up the carnage with innocent Americans dying because they didn’t have the “right” to defend themselves or their family against the criminals who have the guns. One can see how well “gun control” has worked in Washington, DC.
The full decision of the court is here and I encourage you to read it.
The next move and one of my top priorities which regular readers know I hammer on repeatedly is reconstituting the state militias under the control of the state legislatures. Our very survival depends on it and if anyone thinks that’s hyperbole, underestimates the current situation in this country. I’m not going to repeat my past columns on this issue; they’re cited below. I have asked Americans – especially gun owners – to read the scholarly writings of Dr. Edwin Vieira on the Second Amendment and the state militias so that they can learn, as I have, the true nature and meaning of this most important amendment. I feel so strongly about it, I put some of his most important writings on this issue on a CD that people can acquire for $2.00. If time is an issue as it is with most Americans, you can listen to it while you drive (see here, scroll to the bottom). This effort has been very successful and educated thousands.
Edwin’s new book has been released: Constitutional “Homeland Security,” Volume 1: The Nation in Arms. I had the opportunity to read the final manuscript before it went to print. A magnificent piece of writing; here’s Edwin’s opening comment from his book:
“A single individual should not have to undertake this task. It should have been completed decades ago by Congress and the States’ legislatures. It should have been proposed within the last few years by the President, the Department of Defense, the Department of Homeland Security, and leading State Governors. It should be an issue in every contemporary candidate’s campaign for high office throughout this country. But, instead, it has been left to me.
“Whether I can complete it, however, does not depend on me alone. And thanks be to Providence for that, because no single individual could do all that needs to be done. Rather, the success of this endeavor depends upon the readers of this book. Theirs is the responsibility, because the defense of their country today, against the gravest threats that have ever confronted her, depends upon revitalization of “the Militia of the several States” — and they constitute the Militia. I have no doubt that enough of my fellow Americans are equal to this task. History will record whether or not they are willing to take it on.”
I’m here and am urging everyone to do their part. Those in a state of denial or blinded by party loyalty must open their eyes to a painful truth: the mission of Bush and his predecessors is to erect a police state in this country that would rival those of Stalin, Lenin and other world dictators in order to bring Americans under the iron fist of a one world government. Time is of the essence and to the whiners out there who send me their excuses about what can and can’t get done: Buck up and get serious because your backside will depend on this effort succeeding. We only need one state to get this done and then watch history made. Besides Edwin’s warnings on like will happen with a monetary/financial crisis in this country, Americans must understand we are in danger every day because Bush and his corrupt Attorney General, Alberto Gonzalez, refuse to close the border. They know exactly who is running these radical Islamic terror cells in this country and are allowing them to operate; this can be proven clear back to the first World Trade Center bombing in 1993.
Patrick Briley’s detailed research on the issue of terrorist cells, the OKC bombing and the cover up are critically important and should serve as a warning. His columns are archived here. As I conveyed in a past column, Patrick has complied a great deal of this information in a short book available for free on the Internet. We’ve parked it on my main site and every law enforcement officer in this country must read this fully documented information and began demanding answers from Bush, Gonzalez, their state governor and congressional representatives.
“The militia is the natural defense of a free country against sudden foreign invasions, domestic insurrections, and domestic usurpation of power by rulers. The right of the citizens to keep and bear arms has justly been considered, as the palladium of the liberties of the republic; since it offers a strong moral check against the usurpation and arbitrary power of rulers; and will generally … enable the people to resist and triumph over them.” Joseph Story, Supreme Court Justice, Commentaries on the Constitution of the United States, p. 3:746-7, 1833
Our job — because our freedom is our responsibility — is to get Edwin’s book and get it into the hands of your state rep and senator. I purchased six copies and today they’re going into the mail to key legislators I am honored to either know personally or by e-mail exchange and the most effective Second Amendment leaders in those states. I’m not naive or stupid so I know how difficult this undertaking is – the same as Dane and all the wonderful lawyers who worked the Parker v DC case cited above — against what seemed insurmountable odds. But, with the right argument and staying focused, they won and so can we the people.
Because I live in the real world, let me say that the states where there is little to no hope would be California and New York. That doesn’t mean if you’re a citizen of those states you shouldn’t do everything in your power to get the big Second Amendment organizations to get with the goal of freedom and protecting our country to the right side and use their influence. You should, because as things continue to deteriorate, even law enforcement that have been lied to and manipulated by the feds will realize that they cannot do it alone. I would guess our best shot at getting the first state to become a beacon for freedom and liberty would be Montana, Arizona, Idaho or one of the other smaller states. I have been working my fingers to the bone trying to get one state to repudiate the fraudulent Seventeenth Amendment and reconstituting the state militias at the top of my list with that amendment. It’s most unfortunate that programs like Hannity & Columns, O’Reilly and others waste their time covering the naked ‘American Idol’ chick, the pathetic life and death of Anna Nicole Smith or rehashing the same old political BS instead of getting individuals like Dane or Edwin on their shows. But, they aren’t paid to go after the tough issues; not surprising when you consider who owns FOX News Network, globalist and purveyor of filth, Ruppert Murdoch.
First, order Edwin’s book; ordering information below. (For the sake of full disclosure: I receive zero compensation of any kind for recommending any books or DVDs in my columns). Get a copy to your state rep and state senator if you feel they might believe in actually upholding their oath of office. If not, then send or hand deliver it to someone in your state legislature that is a champion of the Second Amendment. Months ago I wrote a column about the National ID: take it to your state legislatures and we have been very effective doing just that; see here. If you know anyone who is active or retired military or law enforcement at any level, give them Edwin’s book, ask them to read it and get back to you with their opinion. Talk to them about constitutional homeland security. Give them a copy of my CD with Edwin’s scholarly writings on this issue so they can listen to it in their car or truck. Education is everything.
All you whiners out there who send me sniveling e-mail, don’t bother because I just trash it. I’m sick to death of sissies and wimps belly aching instead of doing what millions of us have been doing for years: sacrificing our time and what little resources we have to fight. Quit worrying about the oxen out there who trudge each day under the yoke without ever standing up for their rights, foolish hens like Congresswoman Carolyn McCarthy or gas bags on the tube who wouldn’t know what the U.S. Constitution said if James Madison stood before them and read it word by word.
Stop sending me alerts to stop this gun bill or that gun bill. Treating the symptoms still leaves the disease. You either go for the jugular and kill the cancer or continue fighting the same old politicians, decade after decade. There are an estimated 80 MILLION gun owners in this country. If only one quarter of them unite in this effort, we would get the job done and once and for all end this constant assault on our gun rights. Continue doing the same thing that brings failure and failure will continue to be the end result.
Order Edwin’s book: Send a check or money order for $19.95 (with 5% sales tax or a total of $20.95 for orders delivered in Virginia), payable to “Edwin Vieira, Jr.,” to 13877 Napa Drive, Manassas, Virginia 20112. Books will be shipped postpaid by U.S. Postal Service Media Mail.
1. Edwin’s columns on Homeland Security and reconstituting the state militias
2. Patrick Briley’s free book on terrorists operating in this country
3. Second Amendment Committee – this is a site where you learn the truth
4. Attend this important conference in July
5, Devvy’s Place – real time postings on legislation, radio shows, my ‘edgier’ comments on issues, groups and organizations fighting the real issues
6, The Shearing is Nearing by Dr. Edwin Vieira
7, No More Angel Shamaya’s
8, When illegals go berserk will your state be prepared?
9, Sheriff Arpaio implementing true meaning of the Second Amendment
10, Pro Second Amendment incumbents & gun raids
11, Do gun owners really want to stop constant assaults on the Second Amendment?
12, National ID: Target the State Houses
by Paul Craig Roberts
John Derbyshire is the sole remaining adult writing for National Review. In a recent issue he noted that Aldous Huxley’s novel, Brave New World, first published in 1932, now reads like contemporary news. Huxley’s fearsome predictions of a 26th century world have all come true six centuries early – in vitro fertilization, genetically modified crops, stem-cell research, promiscuous recreational sex, the demise of marriage and families, and the epidemic use of prescription and illegal drugs to escape from anxiety, frustration and disappointment.
Alas, Franz Kafka’s novel, The Trial, published in 1925 and George Orwell’s novel, 1984, published in 1949, also have been turned into period pieces by the practices of the Bush Regime.
In Kafka’s novel, Josef K. is arrested for reasons never given, tried for an unspecified crime, and executed.
The Trial is the model for the Bush Regime’s Military Tribunals, which permit execution on the basis of hearsay, secret evidence unknown to the defendant, or confession extracted by torture.
For the past five years, the Bush Regime has held people in secret prisons without warrants, charges, or access to an attorney. Most detainees have been tortured and abused. Bush’s real world victims suffer from more disorientation and hopelessness than Kafka’s character, Josef K.
In Orwell’s 1984, people are subjected to relentless spying. A state or alleged state of war is used to maintain total control over everyone. Lies have replaced truth, and the media serves as propagandist for the Ministry of Truth. The meaning of words, such as “freedom” has been perverted. The attitude of 1984’s all-powerful government is “you are with us or against us.”
In the United States, each member elected to the House and Senate takes an oath to uphold the US Constitution, as does the president and vice president. Yet the Bush Regime drafted and Congress passed the Military Commissions Act, a constitutional monstrosity that denies the protection of law to everyone declared, without evidence, by the executive branch to be a suspected terrorist or enemy combatant.
The Military Commissions Act became law in “the land of the free” in 2006. The Act strips detainees of protections provided by the Geneva Conventions. The Act declares that no person “subject to trial by military commission under this chapter may invoke the Geneva Conventions as a source of rights.”
The Act also denies detainees the protections of the US Constitution and Bill of Rights: “No court, justice, or judge shall have jurisdiction to hear or consider an application for a writ of habeas corpus filed by or on behalf of” a detainee. Some language in the Act refers to detainees as “aliens,” but, ominously, other language does not limit the Act’s applicability to “aliens.”
In Orwell’s novel, Winston Smith commits a thought crime, is arrested by the Thought Police, and imprisoned in the Ministry of Love. Winston’s dearth of rights under Big Brother is comparable to the absence of rights of detainees under the Military Commissions Act
This dangerous legislation is the product of the same regime that resurrected the medieval practice of torture of prisoners and that has consistently lied about the reasons for the wars it has initiated.
Scholars, such as Philip Cooper of Portland State University, warn that the Bush Regime is using presidential signing statements to replace constitutional checks and balances with elevated executive powers associated with the unitary executive theory.
The unitary executive theory is a way to turn the US president into Big Brother. Already Bush is replacing Congress as the arbiter of law and the judiciary as the arbiter of rights. The media enable his usurpation, and the people, distracted by war and “terrorism,” have their various forms of soma.
Amazing but true – three novels of the early 20th century predicted present-day America.
March 12, 2007
THROUGH THE SYSTEM DARKLY
By: Roderick T. Beaman
Over the years, I’ ve witnessed and read about a number of events that have left an indelible impression on me about the welfare system. In no particular order, here they are. I leave the reader to arrive at his own conclusions.
When I was an intern, on my first surgical rotation, I was given the duty of discharging a post-surgical female. The surgeon instructed me to tell her to take a good general vitamin. When I told her, the patient demanded a prescription for it. She was actually indignant, saying “I’m on welfare. I shouldn’t have to pay for it.” When I told the attending that she was demanding a prescription, he told me to tell her that vitamins weren’t covered. He told me that he’d be damned if we should have to pay for something like that. She, grudgingly, accepted.
For a while during the 1960s, the welfare department of New York City was having trouble finding living quarters for their clients. So, they put them up in hotels. And if they couldn’t find a spot in just any old hotel, why they’d put them up at The Waldorf-Astoria! When one welfare client was asked how she felt about living at one of the most expensive hotels in the world, she responded, “The maid service could have been better.” Esquire Magazine gave it a dubious Achievement Award for the year with the caption, “What do they want? What do they really want?”
When I used to work the emergency room, I’d often treat patients or their children. It wouldn’t be unusual to later go to some neighborhood Formica table top restaurant and see the mother working as a waitress. She was working ‘under the table’, as the saying goes. She wasn’t supposed to be receiving any wages at all. At least give her credit for trying to earn something but, if she had been found out, she would have had her monthly allowance reduced.
Welfare patients used to come to the emergency room for routine medical visits. Our hospital had no contract with the welfare department, so they’d pay the physician nothing for the visit because they maintained that it should have been treated in an office. We’d have to treat the patient because if we didn’t, the welfare department would withhold all payments to the hospital. But if the recipient called them up and didn’t know what to do about some minor medical complaint, they’d tell him to go to an emergency room.
One day, I was looking out one of our windows overlooking the parking lot, when a Lincoln Town Car pulled up. A woman, wearing an ankle length fur coat, got out and walked to the back entrance. I said to myself that she was on welfare and was coming to the E.R. for a medical problem for which we’d get paid nothing. .
Sure enough, a few minutes later, I heard the receptionist’s typewriter tapping. When she handed the patient’s information sheet through the window, I looked at it and could tell by the case number that she was on welfare because of ADC (Aid to Families with Dependent Children). I asked the receptionist to get her case card so I could look at it. She had five children with four different last names and she had a fifth. That meant that she had five children by four different men who were either contributing nothing or nearly nothing to the costs of raising them. So, it fell to the taxpayers.
I knew a couple who got divorced because they couldn’t afford health insurance for themselves and their three children. When they divorced, she immediately qualified for ADC. He worked but had no health coverage. Three or four nights a week he’d stay at the house with her and the other nights, sleep elsewhere. He couldn’t stay all the time, because if it was discovered, she’d lose the welfare coverage.
I know a woman who was sent to optometry school while on ADC.
I know another woman who was went to hairdressing school while on welfare, after she had a child out of wedlock. Since she graduated, she has never worked a day as a hairdresser.
Another patient brought her son to the E.R. while I was an intern, and handed him to us, lifeless. We tried to resuscitate him but he was Dead On Arrival. She broke down into tears when we told her of it. She sat in the E.R. crying that ‘I only have six kids, now.’ The more children the recipient had, the higher her monthly grant.
We used to submit our payment claims for medical services on IBM cards. We’d often have the cards returned to us for signatures, usually the physician’s. One colleague often told the story of how he had one returned and said, “Let’s see if they’ll pay it, if I sign it ‘Donald Duck’.” He signed it ‘D. Duck’, sent it in and, sure enough, he got paid.
In my private practice, for a long time, I refused accept welfare patients because of the bureaucratic snafues and the length of time, often three or four months, that it took to get paid anything, that was if you got paid at all. It wasn’t unusual for them to ‘lose’ a bunch of claim forms.
One of the departments at the hospital, had a woman who did volunteer work and was on Rhode Island Disability. They asked me to treat her for her back problem and I relented. I treated her at the hospital and she came to my office. After I treated her, she asked me how I thought she would be. I told her that I thought she was over the worst of it but she might have some more pain, but probably much less. She thanked me, saying that she was glad because she was going to Bermuda the next week and she didn’t want it to ruin her trip.
We had another patient who was on General Public Assistance (GPA). GPA is usually for some type of general problem, often mental such as retardation or psychosis, that renders the client incapable of work. This one patient had a brown belt in karate, yet he was on GPA. You should ask why someone with a brown belt in karate shouldn’t be capable of some kind of gainful employment. He was what we call a frequent flier. He’d come in regularly for some kind of chronic problem that should have been seen in an office.
One time he came in with his girl friend who had no coverage. The physician, Bert, a no nonsense kind of a guy, examined her and gave her a prescription. The Karate GPA Kid came in and asked Bert to give him a prescription on a welfare form in his name because he could get it for no charge. Bert threw him out and called the welfare department to report it as fraud. The woman there asked him why they were bothering them for something like that.
There was another woman, a frequent flier, who had an asthmatic son. He was truly sickly but the mother used to bring him in on a Friday night to have him admitted so that she and her boy friend could take off for the weekend. She did it every five or six weeks. I fell for it a few times but finally wised up. This one weekend, she brought him in and I told her that he wasn’t sick enough to admit him.
She went off on a sob story about how it was too much for her to take care of him. She might have to stay up all night with him, crying for dramatic effect. I told her, look lady, I have four kids and many a night my wife and I spent walking the floors with one or more of them, so her sobs fell on my deaf ears. She didn’t like it but shut up. She went out into the waiting room as her boyfriend arrived with his suitcase packed. So when she told him about her son not being admitted, he got mad.
These are some of the misadventures we had over the years in just this one man’s experience with welfare. Your tax dollars at work.
Why you could soon be paying Wall Street investors, Australian bankers, and Spanish builders for the privilege of driving on American roads.
Daniel Schulman with James Ridgeway
January/February 2007 Issue
“the road is one succession of dust, ruts, pits, and holes.” So wrote Dwight D. Eisenhower, then a young lieutenant colonel, in November 1919, after heading out on a cross-country trip with a convoy of Army vehicles in order to test the viability of the nation’s highways in case of a military emergency. To this description of one major road across the west, Eisenhower added reports of impassable mud, unstable sand, and wooden bridges that cracked beneath the weight of the trucks. In Illinois, the convoy “started on dirt roads, and practically no more pavement was encountered until reaching California.”
It took 62 days for the trucks to make the trip from Washington, D.C., to San Francisco, and another 37 years for Ike to complete a quest, inspired by this youthful journey and by his World War II observations of Germany’s autobahns, to build a national road system for the United States. In 1956, President Eisenhower signed the Federal-Aid Highway Act, which called for the federal and state governments to build 41,000 miles of high-quality roads across the nation, over rivers and gorges, swamps and deserts, over and through vast mountain ranges, in what would later be called the “greatest public works project in human history.” So vital to the public interest did Eisenhower, an old-style fiscal conservative, consider the interstate highway system, he even authorized the federal government to assume 90 percent of the massive cost.
Fifty years to the day after Ike put his pen to the Highway Act, another Republican signed off on another historic highway project. On June 29, 2006, Mitch Daniels, the former Bush administration official turned governor of Indiana, was greeted with a round of applause as he stepped into a conference room packed with reporters and state lawmakers. The last of eight wire transfers had landed in the state’s account, making it official: Indiana had received $3.8 billion from a foreign consortium made up of the Spanish construction firm Cintra and the Macquarie Infrastructure Group (mig) of Australia, and in exchange the state would hand over operation of the 157-mile Indiana Toll Road for the next 75 years. The arrangement would yield hundreds of millions of dollars in tax breaks for the consortium, which also received immunity from most local and state taxes in its contract with Indiana. And, of course, the consortium would collect all the tolls, which it was allowed to raise to levels far beyond what Hoosiers had been used to. By one calculation, the Toll Road would generate more than $11 billion over the 75-year life of the contract, a nice return on mig-Cintra’s $3.8 billion investment.
The deal to privatize the Toll Road had been almost a year in the making. Proponents celebrated it as a no-pain, all-gain way to off-load maintenance expenses and mobilize new highway-building funds without raising taxes. Opponents lambasted it as a major turn toward handing the nation’s common property over to private firms, and at fire-sale prices to boot.
The one thing everyone agreed on was that the Indiana deal was just a prelude to a host of such efforts to come. Across the nation, there is now talk of privatizing everything from the New York Thruway to the Ohio, Pennsylvania, and New Jersey turnpikes, as well as of inviting the private sector to build and operate highways and bridges from Alabama to Alaska. More than 20 states have enacted legislation allowing public-private partnerships, or P3s, to run highways. Robert Poole, the founder of the libertarian Reason Foundation and a longtime privatization advocate, estimates that some $25 billion in public-private highway deals are in the works—a remarkable figure given that as of 1991, the total cost of the interstate highway system was estimated at $128.9 billion.
On the same day the Indiana Toll Road deal closed, another Australian toll road operator, Transurban, paid more than half a billion dollars for a 99-year lease on Virginia’s Pocahontas Parkway, and the Texas Transportation Commission green-lighted a $1.3 billion bid by Cintra and construction behemoth Zachry Construction to build and operate a 40-mile toll road out of Austin. Many similar deals are now on the horizon, and mig and Cintra are often part of them. So is Goldman Sachs, the huge Wall Street firm that has played a remarkable role advising states on how to structure privatization deals—even while positioning itself to invest in the toll road market.
Goldman Sachs’ role has not been lost on skeptics, who accuse the firm of playing both sides of the fence. “In essence, they’re double-dipping,” says Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association, a truckers’ group that opposes toll road privatization. “They’re basically in the middle, playing one side against the other, and it’s really, really lucrative.”
Despite such concerns, the privatization model has the full backing of the Bush administration. Tyler Duvall, the U.S. Department of Transportation’s assistant secretary for transportation policy, says dot has raised the idea with “almost every state” government and is working on sample legislation that states can use for such projects. “This is a ground battle in the United States right now,” he says. “States just need to be convinced that this is basically something they should be considering.”
The financial stakes are potentially huge. “You’re buying the infrastructure of the economy, and it’s enormously valuable,” says John Schmidt, who served as associate attorney general in the Clinton administration and as counsel to the city of Chicago on the $1.8 billion privatization of the Chicago Skyway, the 7.8-mile freeway that connects the Dan Ryan Expressway in the west to the Indiana Toll Road in the east. “[Private road operators] haven’t been able to get in here previously. There’s been a demand, and it’s been bottled up because we just haven’t had privatized infrastructure in this country, so they’ve been buying toll roads in Chile and in France. Now, they suddenly have the opportunity to come into this country.”
at the western end of the Indiana Toll Road, just over the Illinois border, the scenery rolls by like the lyrics to a particularly forlorn Bruce Springsteen song. Passing over Wolf Lake, infamous in these parts as the site where “thrill killers” Nathan Leopold and Richard Loeb dumped the body of 14-year-old Bobby Franks in the 1920s, the highway skirts ghost factories and decaying main streets until, outside Gary, the smokestacks give way to cornfields and Christmas tree farms, and the scenery stays pastoral across the length of northern Indiana. If you’ve ever traveled cross-country on I-90, known here as the “main street of the Midwest,” you’ve driven the Toll Road.
Privatizing this 157-mile interstate artery was the brainchild of Indiana governor Mitch Daniels, a former Eli Lilly executive and the director of the White House Office of Management and Budget between 2001 and 2003—a position in which he was known, for his budget-cutting fervor, as “The Blade.” Daniels, by all accounts, began plotting the privatization of the Indiana Toll Road soon after he took office in January 2005. The new governor was inspired by Chicago’s $1.8 billion Skyway deal but had something far bigger in mind. Leasing out the Toll Road would be the centerpiece of his transportation plan, “Major Moves,” a name—borrowed from a Hank Williams Jr. album—that Daniels said he came up with while singing in the shower. Under the plan, Indiana will spend nearly $12 billion over the next decade on highway construction projects funded, in part, by the proceeds from the Toll Road lease.
By September 2005, the governor was soliciting bids for the project, with Goldman Sachs serving as the state’s financial adviser—a role that would net the bank a $20 million advisory fee. The winning company would maintain and improve the highway, with the lease agreement spelling out its responsibilities down to the maximum time allowed for clearing roadkill. In return, the company would collect tolls, which it would be allowed to raise by a specified percentage each year after 2010. The deal (including the 75-year term chosen for the lease) was structured so the companies would gain a huge tax advantage; to further sweeten the pot, the state instituted the first toll increase in 20 years shortly before the agreement went through, nearly doubling the rate for passenger cars and gradually raising truck tolls 120 percent. (The toll for cars was promptly frozen pending the installation of electronic tolling, sometime before mid-2008; in the meantime, the state is paying mig-Cintra the difference.)
Driving the Toll Road on a temperate late-summer morning, the sun squinting through a thick covering of stratus clouds, it was hard to find anyone who approved of Daniels’ deal. “Our economy’s already bad,” said Amber Kruk, an 18-year-old starting her shift at a Perkins just off the highway in South Bend. “We don’t understand why we’re giving this road to a foreign company.” Gassing up his flatbed at a service station off the Toll Road, 62-year-old trucker Richard DeRohan said he runs the road less now because of the increased tolls. “It should have stayed in state hands,” he said. “I didn’t like when they did it in Chicago. It should be run by a public entity—they’re the ones who created it.”
In a New York Times op-ed published in May, not long after Indiana’s state Legislature approved the Toll Road deal, Daniels acknowledged that public sentiment had run almost 2-to-1 against the idea, and then summarily dismissed the opposition: “Their hearts were in the right place, but not their logic.” Indiana, he argued, “very nearly tore up its equivalent of a Powerball check” as Hoosiers convinced themselves “either that our proposal borrowed from the future, or that it gave away a part of America to ‘foreigners.'”
In fact, Daniels argued in a paper he wrote for the Reason Foundation last spring, “any businessperson will recognize our decision here as the freeing of trapped value from an underperforming asset, to be redeployed into a better use with higher returns.” Yet his administration failed to commission an independent financial analysis of the Toll Road project until the deal was almost done—and when it did, internal emails obtained by Mother Jones show, the motivation was primarily political. “Current criticism from opposition is ‘no independent analysis’ and Scott and his team have kindly volunteered to fill this void,” one high-level state official wrote in a February 2006 email, referring to Scott Nickerson, an executive at the accounting firm Crowe Chizek, which conducted the analysis.
The emails suggest that Daniels’ administration remained preoccupied with how to deploy the analysis to best political advantage—for example, by releasing it through a third party, such as a think tank. “The Governor is of the opinion that in order for our response to be politically independent, he would prefer that Crowe not be formally engaged to do this work,” one email states (emphasis in original). According to another, “Upon further discussion, the group decided that it would be beneficial to be engaged by a separate entity to allow us to perform the consulting project and avoid the appearance of a lack of objective, independent examination.”
In the end, the “independent” analysis, released just days before legislators were set to vote on Daniels’ plan, found exactly what the state had been arguing all along—that the private-sector bid far surpassed what the state stood to earn on its own. Near midnight on the final day of the legislative session, after contentious debate, the bill squeaked through the House in a 51 to 48 party-line vote.
Not everyone bought Crowe Chizek’s conclusions, though. Roger Skurski, a professor emeritus of economics at Notre Dame, analyzed the deal extensively on behalf of an Indiana law firm that brought suit to block the transaction. (The lawsuit ultimately failed.) It was Skurski who found that the value of the road, over a 75-year term, could be as much as $11.38 billion; in a letter to Rep. Thomas Petri, the Wisconsin Republican who chaired the U.S. House Subcommittee on Highways, Transit, and Pipelines, the economist wrote that “based on the State of Indiana’s own studies and figures…it seems that the conclusion changes from ‘deal’ to ‘no deal.'”
“The public was ignored on this; public opinion was ignored on this,” says Dave Menzer, an organizer at Citizens Action Coalition, an Indianapolis-based advocacy group that also joined the anti-privatization suit. “I think that increasingly the public feels like what’s driving politics, what’s driving these decisions, is multinational corporations and deal-makers like Goldman Sachs, Merrill Lynch, and Morgan Stanley. They’re the ones making tens of millions of dollars ultimately at the public’s expense.”
Shortly after the coalition launched its campaign to stop the deal, Menzer says, its six phone lines lit up with callers from around the country seeking to help pay for the lawsuit. In less than a month, it had helped raise nearly $120,000 toward the legal bills. “We saw so many different interests coming together saying that they didn’t like this,” he says. There were libertarians and Republicans, who felt the state was giving away too much for too little; long-haul truckers, who viewed the deal as the first stage of a national trend that could threaten their livelihoods; and environmentalists, who in the fine print of Daniels’ “Major Moves” plan had noticed an effort to revive (and possibly privatize) a long-stalled project to construct Interstate 69, the so-called nafta highway, through the farmlands of southern Indiana.
So why did Daniels insist on pushing the project through in the face of so much opposition? Daniels’ office turned down Mother Jones’ requests for an interview, but quite a few Hoosiers have come to believe that the governor could have been taking his cue from Washington. In this scenario, Indiana, a bellwether state in many ways, would serve as a test case. “Working to make Indiana one of the first states to pave the way for road privatization, to make a bad pun, was definitely his motivation,” Menzer says.
in mid-September, as the 61st United Nations General Assembly convened in New York, the Waldorf Astoria’s dim, ornate lobby was teeming with diplomats and dignitaries who sat huddled in armchairs, conferring in a multitude of languages. Rumor had it that President Bush himself had dropped by the hotel the night before.
Down the hall, in the chandeliered entryway that leads to the Waldorf’s Park Avenue entrance, 300 sharply dressed men and women were carrying on a different sort of diplomacy. These delegates, as they referred to themselves, were representatives from white-shoe investment banks and consultancies; high-powered lawyers; executives from the world’s leading infrastructure companies; and, sprinkled here and there, federal and state officials, who never seemed to go long without being pulled into a conversation and handed a business card. They were at the Waldorf for North American ppp 2006—a conference dedicated entirely to infrastructure privatization in the United States.
As the conference opened, on the morning of September 19, Tom Nelthorpe, the editor of the trade magazine Project Finance, addressed the audience, drawing a laugh when he joked about pirates “plundering the resources of the New World.” “I hope you’ll find today’s varied program evidence of a more sophisticated approach,” he said.
Emerging markets rarely emerge solely on their own, and would-be road operators have spent years working to convince state and local officials that privatization is a no-lose proposition. It has created something of an echo-chamber effect, says John Foote, a senior fellow at Harvard’s Kennedy School of Government who specializes in transportation issues. “If you’ve got enough people whispering in the ears of governors and mayors and so forth saying that this is the greatest thing since sliced bread and don’t miss the boat, pretty soon people start believing it.”
Perhaps the most tireless of the privatization advocates is Mark Florian, the chief operating officer of Goldman Sachs’ municipal finance division, who advised Chicago and Indiana on their toll road deals and says he has personally visited more than 35 statehouses to “help spur the market.” Florian was a speaker at the Waldorf conference, and after his remarks in the hotel’s lavish ballroom, the Goldman Sachs executive—who bears a mild resemblance to Stephen Colbert—was instantly mobbed, rock star style, by delegates, all of whom seemed to be on a first-name basis with him.
“I at times tell my colleagues that I kind of feel like a missionary—out trying to sell the religion,” Florian told Mother Jones. “We have been heavily invested in this.”
Florian’s employer isn’t just any old Wall Street firm. It is one of the nation’s most active and most profitable investment banks, and top Goldman Sachs officials have served in numerous administrations. Last summer, President Bush tapped its ceo, Henry “Hank” Paulson, as secretary of the treasury. Another former Goldman Sachs ceo is New Jersey governor Jon Corzine, who in September commissioned an analysis of whether state assets, including the New Jersey Turnpike, should be turned over to private companies. In addition to advising Indiana on the Toll Road deal, Goldman Sachs has worked with Texas governor Rick Perry’s administration on privatization projects, and according to Schmidt, the former adviser to the Chicago mayor’s office, it was a Goldman Sachs representative who first pitched the city on the idea of leasing out the Skyway.
That deal, which yielded $9 million in fees for Goldman Sachs, was “an eye-opener” for the company, Florian recalls: “That was a pretty phenomenal transaction. As soon as we were involved in that and saw the potential application of doing this more broadly, we were very excited about doing that.” After the Skyway lease closed, Florian says, Goldman Sachs was inundated with calls from investors worldwide who wanted a piece of America’s transportation infrastructure. “We said, ‘Well, gee, if all these people are interested in investing, perhaps we can create a vehicle for them to invest through,'” he explains. To that end, Goldman Sachs put together an infrastructure fund that, by the time Florian addressed the conference, had already surpassed its original $3 billion target. Other investment firms, including Morgan Stanley and the Carlyle Group, began putting together their own funds. So appealing is the infrastructure market that Goldman Sachs has made significant changes to its municipal finance group to better position itself for a coming boom.
When Goldman Sachs began advising Indiana on selling its toll road, it failed to mention to the state that it was putting together a fund whose sole purpose would be to pick up infrastructure for the best price possible in order to maximize returns for its investors. Nor did the bank advertise the fact that, even as it was advising Indiana on how to get the best return, its Australian subsidiary’s mutual funds were ratcheting up their positions in mig—becoming de facto investors in the deal.
“The firm is an established adviser, but we also have this big investment arm,” Florian told Mother Jones, arguing that Goldman Sachs’ dual nature typically doesn’t cause a problem in corporate deals. “But this is a trickier marketplace, and people are cognizant of that because it is so public. It’s so new…. We’re going to really feel our way along here.” A Goldman Sachs spokesman later contacted Mother Jones to stress that there is “a wall” between the firm’s investment and advisory divisions. “Asset management makes its investment decisions independently of the rest of the firm,” he said. Asked whether the firm has a system to prevent conflicts of interest, the spokesman demurred.
Florian says Goldman Sachs does have a system for avoiding conflicts in situations when Goldman is a principal investor in a deal. “We put in a voice mail and some information about that situation and what our role might be, and it literally goes around the world…. It’s a good system, but it’s not always perfect.” Indeed, the system didn’t stop Goldman Sachs last spring from vying to advise the city of Chicago on a deal to privatize Midway airport—even as it was seeking, along with other partners, to take over British Airports Authority, one of the companies likely to bid on the airport.
“One of the things we’ve learned in these recent corporate scandals is that those firewalls may not be very soundproof,” says Duane Windsor, a professor of business management at Rice University and an expert on business ethics. “There is a lot of leakage back and forth…that kind of problem where the motives are so mixed that it’s hard to tell why you are getting a certain piece of advice.
“There’s no reason to think the people in these companies are abnormally honest,” he adds wryly.
Dennis Enright, a principal at NW Financial Group, a New Jersey-based investment banking firm that advises municipal governments, says that in transactions involving vital public assets, investment banks such as Goldman Sachs should be carefully watched. “It does seem odd that they are effectively teeing up assets for their corporate clients to buy,” he says. “In most situations, that wouldn’t be deemed ethical.” John Foote, the Kennedy School fellow, also suggests that Goldman Sachs has “some decisions to make. People don’t want them playing on both sides of the fence.”
So, we asked Florian, does Goldman Sachs want to be an adviser or an investor in the business of roads? “Both,” he replied.
since its emergence as a major political issue in the Reagan era, privatization has become a default option for politicians of both parties aiming to off-load everything from prisons and welfare offices to Social Security. The movement has spawned its own industry of contractors, consultants, think tanks (with the Reason Foundation in the lead), and lobbyists; as a result, private companies now do everything from feeding soldiers in Iraq to taking welfare applications and even operating entire city halls for towns such as Sandy Springs, Georgia, a city of 85,000 that has outsourced its public works, administration, and finance to the Colorado-based firm ch2m hill. But the brass ring has long been seen to be the nation’s enormous, and aging, infrastructure.
Roads, in particular, are ripe for the picking. Congestion is increasing, and the Federal Highway Administration estimates that it will cost $50 billion a year above current levels of federal, state, and local highway funding to rehab existing bridges and roads over the next 16 years. Where to get that money, without raising taxes? Privatization promises a quick fix—and a way to outsource difficult decisions, like raising tolls, to entities that don’t have to worry about getting reelected.
More often than not, those entities are foreign—primarily because, unlike U.S. firms, foreign companies have years of experience operating private toll roads in South America, Europe, and Australia. One of the biggest among them is mig, a $6 billion subsidiary of Macquarie Bank Ltd. The company operates roads in the United Kingdom, Canada, and Germany, among other countries, but, as ceo Stephen Allen told the Australian TV show Business Sunday in 2005, “The attractive market to us is the U.S…. We’re well positioned in what we think could be a huge market.” The company’s annual report offers an upbeat illustration of mig’s business: a picture of a sad-faced terrier alone in a living room at 6:10 p.m. (“Before”); a picture of the same terrier with attractive couple, in the same living room, same time (“After”). “Our motorways deliver people to places faster than if they used the often heavily congested, slower alternative routes,” the copy notes.
mig once owned 40 percent of Cintra (Concesiones de Infraestructuras de Transporte, S.A.), a Spanish company whose holdings include 21 roads across Europe and the Americas. Cintra’s 2005 annual report describes the company as “one of the world’s leading private transportation infrastructure developers,” and reassures investors that it offers the magical combination of high profits and “a low risk profile.” Investors in toll roads face stable revenues as well as expenses—and, best of all, “limited competition.”
Indeed, private road operators often insist on noncompete clauses that limit governments from expanding nearby roads. In 2003, Orange County bought back the lease for a set of pay-to-drive express lanes in the median of Route 91, just so it could finally expand the adjacent road. Toll road companies can even get governments to do their enforcement for them: In July 2004, the consortium that owns Toronto’s 407 etr, a 67-mile highway that relies on transponders and cameras to collect tolls, sued the provincial government to force it to deny license plate renewals to motorists who hadn’t paid their tolls. In the end, the consortium, which included mig and Cintra, was successful.
Over the past few years, the federal government has rolled out the welcome mat for private road companies. The 2005 highway bill changed the tax code to allow private firms to raise tax-exempt financing for road projects, something that only governments were able to do up to now. (For congressional pork buffs, this was the same legislation that contained Alaska Republican congressman Don Young’s “bridge to nowhere,” and that, by way of homage to Young’s wife, Lu, was named the Safe, Accountable, Flexible, Efficient Transportation Equity Act—A Legacy for Users, a.k.a. safetea-lu.) The bill also expanded eligibility for a transportation subsidy program that includes loan guarantees and lines of credit, and created a pilot program that lets participating states use tolling to finance interstate highway construction and invite private-sector participation on the projects. “It’s a very, very sweet deal,” says a veteran congressional transportation committee staffer who requested anonymity because of his role advising members on highway policy.
one morning last May, Congress took up the issue of highway privatization in a hearing of the House Subcommittee on Highways, Transit, and Pipelines. In attendance were D.J. Gribbin, a former chief counsel to the Federal Highway Administration who went to work as a lobbyist for Macquarie early last year; Goldman Sachs’ Mark Florian; and Governor Mitch Daniels, who was then a little more than a month away from sealing his historic deal with Cintra and mig.
Referring to Indiana’s decision to privatize its toll road, Daniels told the committee that so far, no one in government has come up with a workable solution to patch the gap between transportation needs and available funding. “All across our state, hundreds of road and bridge projects have been promised for years, in some cases decades, with no source of funding and no hope of becoming reality unless bold new steps are taken…. We looked at every option to address this funding shortfall, from raising the state gas tax [to] issuing more debt, increasing heavy truck fees, and increasing vehicle registration fees, to name just a few. It was clear that very few of these 200-plus projects would become reality on a business-as-usual basis.”
He later remarked, “Just as many business units are more valuable if separated from their conglomerate parent, an asset like a highway can be worth vastly more under different management.”
The hearing was a fairly docile affair—that is, until Oregon’s Peter DeFazio, the ranking Democrat on the subcommittee, got his turn questioning Daniels. “So you’re saying that there’s no political will to raise the tolls,” he began, “but if you enter into a binding contract which gives a private entity the right to infinitely raise tolls, then that’ll happen—but politically you couldn’t say we’re going to go out and raise the tolls.”
“Well, you’re a busy man, Congressman,” Daniels responded dryly. “I don’t expect you to understand our state.”
“No, sir. I’m just asking a question,” DeFazio shot back, his voice rising. “Are we outsourcing political will to a private entity here?”
When DeFazio spoke with Mother Jones months later, he was still seething. Daniels, he said, “just screwed the state of Indiana and the people of the state of Indiana.” In his view, mig-Cintra has “a license to print money here. They do the deal, put money up front, turn around and go to a bank, which will gladly give them whatever they want, and pay themselves back, and they are left with equity and debt. They are projecting that they already would have broken even around the 15th year. So we’ve committed an asset for 75 years and after 15 years the state could have been making money on it.”
DeFazio continued, “When you look at the Chicago Skyway, that’s even worse. They are not even reinvesting the proceeds of the sale in transportation. They’re using them for operating costs. That would be like anybody selling their assets in order to live. You can’t sell your assets very long to put food on the table—before long you’re out of assets. Chicago has sold an asset, which will be extraordinarily profitable for the company that got it.”
DeFazio’s take harkens back to Eisenhower and his vision of a national highway system as vital to economic development, commerce, and even national security. “It’s a scam, basically,” he says. “And you lose control of your transportation infrastructure. It means you fragment the system ultimately. It just does not make sense for an integrated national transportation system.”
The transportation committee staffer echoes DeFazio’s broad concerns. “You’re replacing a federal-state partnership with a public-private partnership,” he says, “and the whole idea of developing a national transportation system may go by the wayside.” When asked whether private interests will begin to drive transportation decisions, including when and where roads are constructed, he responded, “Absolutely. They would definitely only go to where the profit is.” Just as the creation of a National Highway System promised, in Eisenhower’s words, to “change the face of America,” so too could its demise.
Ralph Nader, too, has been vocal in opposing the privatization deals. Last February he wrote a scathing letter to Mitch Daniels, comparing the toll road lease to the Louisiana Purchase, “only Indiana is the France of this deal. You are taking a minuscule up-front payment in return for a large downstream private profit to a foreign company which is being handed a captive customer base.” Nader says he and other consumer advocates were late to recognize the trend. “Who would have dreamed” that the nation would begin actually selling off its core assets, he told Mother Jones. “That’s new. They caught everybody napping.”
Some conservatives are also sounding the alarm. Phyllis Schlafly, writing for the conservative publication Human Events in September 2006, tore into the recent privatization deals under the colorful heading “Greedy Politicians Seduced by Siren Song of Filthy Foreign Lucre.”
“Why the rush to sell our transportation systems to foreigners?” she queried. “‘Follow the money’ explains all. State and local governments pocket the money upfront and get to spend it here and now, so politicians can cover their runaway budget deficits and enjoy the political rewards of spending for new facilities. They ignore the fact that U.S. citizens must pay tolls to foreign landlords for the next two or three or even four generations.”
In some places, highway deals have already become campaign fodder: In Texas, where Governor Rick Perry has proposed a $184 billion, 4,000-mile network of toll roads, which is expected to be financed largely through public-private partnerships, the notion proved widely unpopular, and independent gubernatorial candidate Carole Keeton Strayhorn made the proposal a key target of her campaign. “I don’t think the people want anything that is riddled with personal profiteering and enrichment, and this is riddled with all of the above,” she told Mother Jones last July. “This is critical infrastructure and you are turning it over to a foreign company with a secret contract.”
Perry has refused to release many of the details of the $1.3 billion contract his administration has signed with Cintra for a toll road from Austin to Seguin. The Spanish company has enjoyed a cozy relationship with the governor’s office: Perry’s former legislative director, Dan Shelley, worked as a Cintra consultant and lobbyist prior to joining the governor’s staff, and in September 2005, he went back to work for Cintra. Both he and his daughter, Jennifer Shelley-Rodriguez, now have lucrative contracts to lobby Texas legislators on the company’s behalf.
More and more, the argument over private roads comes down simply to the bottom line. Dennis Enright, the infrastructure expert at NW Financial, says the most common argument for privatization deals—that government simply can’t come up with the kind of big money private companies can mobilize—is a myth: “If the public sector wants to raise $1.8 billion or $3.8 billion, they can do it themselves” with standard financing techniques. The problem with public-private deals, Enright argues, is that the companies will cherry-pick the most profitable roads and leave much of the public stuck in the slow lane. He offers this hypothetical: “If you want to go on the Chicago Skyway during rush hour, they can charge you a much higher price because it’s premium travel time. Now what does that do to the rest of the transportation system? It puts all of those people who can’t use the Skyway onto the adjacent roads. Now the adjacent roads are backed up further. Now [the Skyway] can charge even more because they have more of a time advantage.”
Enright concludes, “The private operator’s fidelity is to his stockholders—not to the public transportation system, not to the people who use the road. His duty is to get the most possible revenues out of the asset.” Enright’s firm did a study showing that if a pricing scheme similar to the one agreed to in Chicago had been applied to New York’s Holland Tunnel for the past 70 years, the toll would stand at $185 rather than the current $6.
Higher tolls and a proliferation of private roads are certainly in the nation’s future unless the federal government delivers some other solution to a looming funding crisis. The federal highway trust fund, which is financed by the proceeds of the federal gas tax, is running out of money—in part because lawmakers have not dared to raise the tax, currently 18.4 cents per gallon, since the mid-’90s. At this rate, the fund, which is the primary source of money for federal highways, will be spending more than it takes in by 2009. “A question has been raised about what the proper federal role in transportation is,” the transportation committee staffer says. That question now faces Congress, which has responded, in trademark fashion, by creating a commission. In 2005, as lawmakers hefted safetea-lu onto the president’s desk, they convened the National Surface Transportation Policy and Revenue Study Commission, with the lofty mandate of exploring ways to “preserve and enhance the surface transportation system to meet the needs of the United States for the 21st century.”
The commission’s chair is Transportation Secretary Mary Peters, who is, as dot’s Tyler Duvall puts it, a “tremendous champion” of privatization. Joining her is Paul Weyrich, the founder of the Heritage Foundation—the conservative think tank that advocates privatization. Another commission member, Cornell economist R. Rick Geddes, has suggested turning the U.S. Postal Service over to the private sector. Geddes told Mother Jones that, while he is not yet sold on the idea of private highways, he is “sympathetic” to the model; he said the commission’s recommendations, due by July 1, will likely suggest a number of “tools in the toolbox.”
DeFazio, however, fears the panel may have already made its choice. “My understanding is it’s turning more and more and more toward a sole focus of how to justify the privatization of infrastructure—just like Bush’s Social Security commission,” he says. “You couldn’t be on the commission to study the future of Social Security unless you signed off in favor of a privatization solution in the beginning. It sounds like they’re trying to pervert the commission we created to take the same direction.”
One reason the Bush administration has fared so poorly over the past several years is its obsessive fear of public accountability, separation of powers and checks and balances. From its secret prisons to its classified torture memos, from its clandestine authorization of NSA spying to its efforts to deny the detainees at Guantanamo Bay any access to the writ of habeas corpus, the Bush administration has entered one long plea of “trust us”. President Bush is, after all, “the decider”.
As the Framers of the US Constitution well understood, such an approach to governance is a recipe for disaster. A recently-released Justice Department audit of the FBI’s use of PATRIOT Act authority is the latest example of the consequences that accompany the “trust us” theory of governance.
Enacted only weeks after 9/11, the PATRIOT Act, among other things, empowered the FBI in the course of terrorism investigations to issue “national security letters” (NSLs), which can be used to force businesses, universities, telephone companies and other organizations to turn over email, telephone, credit card, banking, educational, library, medical and other personal and financial information to the FBI.
Civil libertarians objected that this procedure authorized the FBI to invade legitimate private interests without any judicial supervision. The Bush administration, however, insisted, as always, on the autonomy of the executive branch. It promised that it would institute internal FBI safeguards to ensure that this authority was not abused. Judicial oversight, it explained, was a bother and, in any event, unnecessary.
The Justice Department’s audit of the NSL program reveals, once again, the difference between government by executive decree and government by checks and balances. From 2003 to 2005, the FBI issued more than 140,000 NSL requests. Although the FBI is required by law to report these requests to Congress, the audit revealed that over the past three years the FBI underreported the number of national security letters it had issued by more than 20%.
Even more shocking, over the past three years the FBI reported a total of only 26 instances in which it had violated the guidelines for the issuance and use of national security letters. But when the Justice Department independently audited the FBI’s records, it found violations – not reported by the FBI – in 22 of the 293 national security letters it examined. Thus, roughly 7% of the national security letters – approximately 10,000 – were issued unlawfully. In effect, then, the FBI had self-reported fewer than 1% of its own violations.
These violations run the gamut from improper requests for NSLs, to unauthorized collection of data, to unlawful authorization of NSLs. Some of these errors were made by the FBI, others were made by the third-party recipients of the NSLs. Most of these errors were no doubt unintentional. They were due to inadequate guidelines, confusion about the standards and reporting requirements, typographical errors that resulted in information being obtained about the wrong people, and the like.
But none of that is an excuse. For the government to gather private information about individuals for use in terrorism investigations is a serious business. The failure to institute appropriate guidelines, standards, procedures and safeguards is precisely why public accountability, separation of powers and checks and balances are important. What this blunder of executive branch arrogance proves once again is clear – “trust us” is not how a well-functioning democracy operates.
Friday, March 9, 2007
It is shameless, but wholly typical. “Fears about U.S. job losses from globalization are driving the debate over renewing the White House’s fast-track trade negotiating authority and may require legislative action on a number of fronts, a top Senate Democrat said,” reports the CIA’s favorite newspaper, the Washington Post. “The White House wants a renewal of fast-track trade legislation—also known as trade promotion authority—to finish the five-year-old Doha round of trade talks and pursue additional bilateral trade deals.”
Of course, this has nothing to do with fears of job losses, as impoverishing the American people, or rather putting them on a “level playing field” with the slave economy of “communist” China is the idea here. NAFTA was sold in much the same way. “NAFTA means jobs. American jobs, and good-paying American jobs. If I didn’t believe that, I wouldn’t support this agreement,” declared Clinton in 1993, as he signed “NAFTA side agreements.” Clinton, a member of the Trilateral Commission, knew the exact opposite would happen—NAFTA made sure “good-paying American jobs” would eventually end up in China by way of Mexico.
It is no mistake “fast track” legislation was passed by Congress in 1974, a mere year after the founding of the Trilateral Commission. “In Article 1, Section 8 of the U.S. Constitution, authority is granted to Congress ‘To regulate commerce with foreign nations.’ An end-run around this insurmountable obstacle would be to convince Congress to voluntarily turn over this power to the President. With such authority in hand, the President could freely negotiate treaties and other trade agreements with foreign nations, and then simply present them to Congress for a straight up or down vote, with no amendments possible,” writes Patrick Wood for the August Review. “When an agreement is about to be given to Congress, high-powered lobbyists and political hammer-heads are called in to manipulate congressional hold-outs into voting for the legislation. With only 20 hours of debate allowed, there is little opportunity for public involvement.” Of course, “congressional hold-outs” are a minor issue, as Congress is by and large a corporate bought and paid for whorehouse.
“Fast Track was created as a very specific legislative tool to accomplish a very specific executive task—namely, to ‘fast track’ the creation of the ‘New International Economic Order’ envisioned by the Trilateral Commission in 1973,” Wood continues. Some of us call it the “New World Order.” I call it the “Neoliberal World Order,” as it is all about neoliberal economic policy as envisioned by the Trilateral Commission, the Council on Foreign Relations, David Rockefeller, and Zbigniew Brzezinski, who tutored Jimmy Carter on the ins-and-outs of predatory globalism. It is interesting to note that Brzezinski has come out in vocal opposition to the neocon faction, determined to start “World War Four” at the behest of Israel, as this most certainly endangers the “New International Economic Order.”
According to Woods, “the United States has literally been hijacked by less than 300 greedy and self-serving global elitists who have little more than contempt for the citizens of the countries they would seek to dominate. According to Trilateralist Richard Gardner’s viewpoint, this incremental takeover (rather than a frontal approach) has been wildly successful.” Indeed, as the brisk clip of the so-called North American Union zipping along demonstrates, mostly unseen by the vast majority of Americans, this “incremental takeover,” as opposed to the in-your-face “frontal approach,” is “wildly successful.”
Former Treasury Secretary Lawrence Summers told the Senate Finance Committee “fast track,” due to expire, must be “put it in the broader context of adapting the economy to globalization,” that is to say remaking America in the image of the slave labor gulag, China. Our “representatives,” beholden to multinational corporations, declare they only want to “better equip Americans to compete in the global workplace,” that is to say get them accustomed to working for a hundred bucks a week or less.
Obviously, little to nothing stands in the way of a unitary decider “fast tracking” largely ignorant citizens into the global slave labor plantation, i.e., the “New International Economic Order” mapped out by the Trilateral Commission and the CFR.
By Liz McIntyre & Katherine Albrecht
March 10, 2007
The top brass at American Express, chagrined at the discovery of its people tracking plans, met with CASPIAN (Consumers Against Supermarket Privacy Invasion and Numbering) last week to discuss the issue. One outcome of the meeting was a promise by American Express to review its entire patent portfolio and ensure that any people-tracking plans be accompanied by language requiring consumer notice and consent.
The meeting was organized after CASPIAN called attention to one of the company’s more troublesome patent applications. That patent application, titled “Method and System for Facilitating a Shopping Experience,” describes a Minority Report style blueprint for monitoring consumers through RFID-enabled objects, like the American Express Blue Card.
According to the patent, RFID readers called “consumer trackers” would be placed in store shelving to pick up “consumer identification signals” emitted by RFID-embedded objects carried by shoppers. These would be used to identify people, track their movements, and observe their behavior.
The patent also suggested such people-tracking systems could “be located in a common area of a school, shopping center, bus station or other place of public accommodation.”
Allegations of American Express people-tracking blueprints first came to light at a conference sponsored by the Consumer Federation of America in Washington, D.C. last month. There, Dr. Katherine Albrecht, Founder and Director of CASPIAN, revealed the patent pending plans that she and her “Spychips” co-author Liz McIntyre uncovered in their ongoing RFID research.
Soon thereafter, American Express arranged for four of its vice presidents, including the vice presidents of Contactless Payments and Public Affairs, to meet with CASPIAN leaders in a phone conference.
“We are pleased that American Express responded to our concerns,” said Albrecht. “It’s clear the company is thinking about privacy issues and wants to address them constructively. However, we had hoped that American Express would renounce its people tracking plans altogether and be more sensitive to the fact that placing RFID tags in consumer items, like credit cards, puts consumers at risk for surreptitious tracking by others.”
In response to CASPIAN concerns, American Express also promised that it would make a chip-free version of its credit card available to concerned consumers who ask for it.
“Offering a chipless credit card is a positive step and should serve as an example to the rest of the industry,” said McIntyre. “Consumers don’t like RFID technology. Contrary to American Express ads, most people would rather leave home without it.”
By HEDY WEINBERG
“We are, after all, for the first time in the history of a liberty-loving nation, creating a national identification card … with all the ramifications of that. … Real ID was stuffed into the supplemental appropriations bill for Hurricane Katrina and the troops in Iraq, so of course, we had to vote for the bill, but we had no chance to amend it — no debate, no hearing, and no consideration of other alternatives, And now we impose on the states an $11 billion unfunded mandate. … I would say we wouldn’t be doing our job if we didn’t stop and think about what we’ve done.”
Sen. Lamar Alexander’s recent comments about the Real ID Act echo the widespread bipartisan resistance to this new law.
In 2005, Congress passed the Real ID Act, a law that proposed a sea change in how states issue driver’s licenses. In essence, the law would federalize all state departments of motor vehicles and turn our driver’s licenses into national identity cards. The burdens of compliance are onerous and guarantee longer lines, higher fees and huge bureaucratic and financial nightmares for state government.
However, the real nightmare of Real ID is the law’s assault on our privacy rights. The law mandates a central, interlinked database containing a wealth of personal information, including name, address, date of birth, biometric information and an assigned identification number. Over time, the database will inevitably become the repository for more and more of citizens’ personal data and will be used for an ever-wider set of purposes, moving us closer to a surveillance society.
Vulnerable to thieves
Linking the Real ID information to a central database makes our private information vulnerable to identity thieves. Real ID requires the DMV to store scanned copies of all documents presented as part of the application process. A single break in the security of this system at any of the thousands of DMV offices across the country could potentially compromise the personal information and documents of millions of Americans.
It’s not often that the ACLU agrees with Sen. Alexander, but he got it right when he said that the two-year delay could be used to re-examine Real ID, explaining “It’s not insignificant that there are privacy concerns. Big Brother government is a big problem.”
In addition, Real ID remains an unfunded federal mandate. The federal government estimates the cost of implementing Real ID at over $11 billion. Yet the government has pledged only $130 million toward the states to comply with that effort.
Concerns about privacy, security, cost and implementation are fueling a growing national revolt against Real ID. In January, Maine became the first state to pass a resolution rejecting participation in the Real ID scheme. Last Thursday, Idaho passed a resolution to opt out of Real ID.
Real ID is built on the false premise that this attack on privacy and security will make our nation more secure. But the truth is that Real ID does little to make us safer. Tennesseans must join the rebellion now and call on their elected officials to end the real nightmare that is Real ID.
For more information, go to http://www.Realnightmare.org.
WASHINGTON – The nation’s top two law enforcement officials acknowledged Friday the FBI broke the law to secretly pry out personal information about Americans. They apologized and vowed to prevent further illegal intrusions.
Attorney General Alberto Gonzales left open the possibility of pursuing criminal charges against FBI agents or lawyers who improperly used the USA Patriot Act in pursuit of suspected terrorists and spies.
The FBI’s transgressions were spelled out in a damning 126-page audit by Justice Department Inspector General Glenn A. Fine. He found that agents sometimes demanded personal data on people without official authorization, and in other cases improperly obtained telephone records in non-emergency circumstances.
The audit also concluded that the FBI for three years underreported to Congress how often it used national security letters to ask businesses to turn over customer data. The letters are administrative subpoenas that do not require a judge’s approval.
“People have to believe in what we say,” Gonzales said. “And so I think this was very upsetting to me. And it’s frustrating.”
“We have some work to do to reassure members of Congress and the American people that we are serious about being responsible in the exercise of these authorities,” he said.
Under the Patriot Act, the national security letters give the FBI authority to demand that telephone companies, Internet service providers, banks, credit bureaus and other businesses produce personal records about their customers or subscribers. About three-fourths of the letters issued between 2003 and 2005 involved counterterror cases, with the rest for espionage investigations, the audit reported.
Shoddy record-keeping and human error were to blame for the bulk of the problems, said Justice auditors, who were careful to note they found no indication of criminal misconduct.
Still, “we believe the improper or illegal uses we found involve serious misuses of national security letter authorities,” the audit concluded.
FBI Director Robert S. Mueller said many of the problems were being fixed, including by building a better internal data collection system and training employees on the limits of their authority. The FBI has also scrapped the use of “exigent letters,” which were used to gather information without the signed permission of an authorized official.
“But the question should and must be asked: How could this happen? Who is accountable?” Mueller said. “And the answer to that is, I am to be held accountable.”
Mueller said he had not been asked to resign, nor had he discussed doing so with other officials. He said employees would probably face disciplinary actions, not criminal charges, following an internal investigation of how the violations occurred.
The audit incensed lawmakers in Congress already seething over the recent dismissals of eight U.S. attorneys. Democrats who lead House and Senate judiciary and intelligence oversight panels promised hearings on the findings. Several lawmakers — Republicans and Democrats alike — raised the possibility of scaling back the FBI’s authority.
“It’s up to Congress to end these abuses as soon as possible,” said Sen. Edward M. Kennedy, D-Mass., who sits on the Senate Judiciary Committee. “The Patriot Act was never intended to allow the Bush administration to violate fundamental constitutional rights.”
Rep. Pete Hoekstra, top Republican on the House Intelligence Committee, said the audit shows “a major failure by Justice to uphold the law.”
“If the Justice Department is going to enforce the law, it must follow it as well,” said Hoekstra, of Michigan.
The American Civil Liberties Union said the audit proves Congress must amend the Patriot Act to require judicial approval anytime the FBI wants access to sensitive personal information.
“The attorney general and the FBI are part of the problem, and they cannot be trusted to be part of the solution,” said ACLU’s executive director, Anthony D. Romero.
Both Gonzales and Mueller called the national security letters vital tools in pursuing terrorists and spies in the United States. “They are the bread and butter of our investigations,” Mueller said.
Gonzales asked the inspector general to issue a follow-up audit in July on whether the FBI had followed recommendations to fix the problems.
Fine’s annual review is required by Congress, over the objections of the Bush administration. It concluded that the number of national security letters requested by the FBI skyrocketed in the years after the Patriot Act became law. Each letter issued may contain several requests.
In 2000, for example, the FBI issued an estimated 8,500 requests. That number peaked in 2004 with 56,000. Overall, the FBI reported issuing 143,074 requests in national security letters between 2003 and 2005.
But that did not include an additional 8,850 requests that were never recorded in the FBI’s database, the audit found. A sample review of 77 case files at four FBI field offices showed that agents had underreported the number of national security letter requests by about 22 percent.
Additionally, the audit found, the FBI identified 26 possible violations in its use of the letters, including failing to get proper authorization, making improper requests under the law and unauthorized collection of telephone or Internet e-mail records.
The FBI also used exigent letters to quickly get information — sometimes in non-emergency situations — without going through proper channels. In at least 700 cases, these letters were sent to three telephone companies to get billing records and subscriber information, the audit found.