Andy Kroll

Andy Kroll

Senior Reporter

Andy Kroll is Mother Jones' Dark Money reporter. He is based in the DC bureau. His work has also appeared at the Wall Street Journal, the Detroit News, the Guardian, the American Prospect, and TomDispatch.com, where he's an associate editor. Email him at akroll (at) motherjones (dot) com. He tweets at @AndrewKroll.

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Can the Tea Party Steal Nevada?

| Fri May. 28, 2010 6:35 AM PDT

Will the Tea Party score another early victory, this time in Nevada's June 8th GOP primary? The latest Mason-Dixon/Las Vega Review-Journal poll suggests as much. GOP frontrunner Sue Lowden, with 30 percent support, has seen her once-formidable lead shrink to a meager one-point margin over Sharron Angle, the Tea Party-endorsed, more conservative candidate eyeing incumbent Harry Reid's Senate seat this fall. Danny Tarkanian, the third major candidate in Nevada's GOP primary, has 23 percent support. Angle's 29 percent support signals a major surge for the former Nevada assemblywoman, given she only had 13 percent support a month ago, polls show.

Angle's rise can be attributed to a number of sources. The Tea Party darling's campaign has been outright bashing Sue Lowden's conservative cred, running ads that say she supported state spending increases, raised taxes, and even, god forbid, backed Harry Reid. (Lowden refutes these claims.) Lowden herself hasn't been helping her cause, either: There was Chickengate; then Tarkanian accused her of breaking campaign finance law by accepting an RV from a donor; and more recently she pulled a Rand Paul by stumbling when asked about her views on the Civil Rights Act. (She failed to answer the question, then released a statement afterward saying, yes, she supports it.) Not that Angle has been without controversy herself—she's taken heat for alleged ties to the Church of Scientology.

One of the biggest causes for Lowden's plummet, though, has been Harry Reid. As Reid's campaign sees it, they'd much rather face Sharron Angle, a more controversial and less established figure, then Lowden, a creature of the GOP establishment. Reid's team has unleashed a barrage of attacks on Lowden, doing everything they can to sink her run for the GOP candidacy this fall and open the door to Angle. "[Angle is] the most polarizing," said Mason-Dixon polling director Brad Coker. "She's clearly the most conservative. But that 20 percent of independent voters are the ones who are going to decide this election. And it's easier for them to pick a Lowden or even a Tarkanian."

Which is to say, out in Nevada, the Tea Party might win the primary battle, but if they do, odds are Harry Reid will win the war.

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Is BP Dodging $2 Billion in Fines?

| Thu May. 27, 2010 8:35 AM PDT

Rep. Ed Markey (D-Mass.) ripped oil corporation BP today by claiming they were low-balling the spill's damage to dodge more than a billion dollars in financial liabilities. Markey's attacks come on the same day an independent report put the BP oil spill at between 12,000 and 19,000 barrels a day, far exceeding BP's 1,000 to 5,000 estimate. “What’s clear is that BP has had an interest in low-balling the size of their accident, since every barrel spilled increases how much they could be fined by the government,” said Markey, who chairs the select committee on Energy Independence and Global Warming and the Energy and Environment subcommittee.

According to Markey, the difference between BP's and independent scientists' estimates on the spill's size amounts to tens of millions of dollars everyday. If the spill were really 1,000 barrels per day, the fines would total between $5 to $15 million each day; if 14,000 barrels a day, then BP is looking at fines of $14 to $42 million every day. The current governing financial liabilities for oil spills like BP's, the Oil Pollution Act of 1990, mandates fines of $1,000 per barrel or, in the case of "gross negligence," $3,000 per barrel. All told, BP, using scientists' projections on the Gulf spill, the oil giant could face fines of $444 million and $2.1 billion now on the 37th day of the spill.

Here's Markey's full release on BP's financial liabilities:

Following the release of a report on the flow rate of the oil spill by a technical team assembled by the Obama administration, Rep. Edward J. Markey (D-Mass.) today continued to raise questions about BP’s potential motivations to low-ball the flow rate and size of the spill, and released new documents showing BP knew the spill could have been much bigger than they claimed.

The report, conducted by the National Incident Command’s Flow Rate Technical Group, found that the spill was likely between 12,000 and 19,000 barrels a day, far above the 1,000-5,000 barrels a day BP estimated for most of the spill’s duration. Rep. Markey has engaged with numerous independent scientists on this issue who claimed the spill was much larger than BP’s estimates.

"Now we know what we always knew—this spill is much larger than BP has claimed," said Rep. Markey, who chairs the Select Committee on Energy Independence and Global Warming and the Energy and Environment Subcommittee in the Energy and Commerce Committee. "What’s clear is that BP has had an interest in low-balling the size of their accident, since every barrel spilled increases how much they could be fined by the government."

Yesterday Rep. Markey pressed this point with Interior Secretary Ken Salazar, citing documents he obtained from BP that showed BP knew as early as a week after the explosion on the Deepwater Horizon rig that the spill could have been much higher than their initial estimate of 1,000 barrels. Secretary Salazar agreed with Rep. Markey that BP could have a financial interest in underestimating the size of the spill.

The documents can be found here

One document, dated April 27, shows that BP’s high estimate for the daily rate of the spill was 14,266 barrels per day, well within the midrange of today’s technical group report. Yet one day later, BP was asserting to the public that the spill was only 1,000 barrels a day—their low estimate for the size of the spill.

The implications for BP’s financial liability are directly tied to the size of the spill. Under current law—the Clean Water Act as amended by the Oil Pollution Act of 1990, following the Exxon Valdez disaster—a company that spills oil is subject to fines up to $1,000 per barrel, or up to $3,000 per barrel in the case of gross negligence.

For BP, the difference between an estimate of 1,000 barrels per day and one of 14,000 barrels a day could really be the difference between $5 to $15 million per day in fines versus $14 to $42 million per day. That means, at the end of yesterday, the 37th day of the spill, the difference could potentially be between $37 million in fines or $1.5 billion in fines, according to BP’s own estimates from the documents.

According to the range reached by the technical group today, BP could be subject to between $444 million and $2.1 billion in potential fines for the oil spilled thus far.

"BP has to stop protecting their liability and start dealing with the reality of the size of this spill,” said Rep. Markey. “Knowing the size of the spill is vital to all facets of this spill, from response to recovery to accountability."

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Steve Eisman's Next Big Short: For-Profit Colleges

| Thu May. 27, 2010 4:55 AM PDT

Steve Eisman, the outspoken investor whose huge wager against the subprime mortgage market was chronicled by author Michael Lewis in his bestselling book The Big Short, has set sights on a new target: for-profit colleges of the kind of you might see advertised on daytime TV and at bus stops. Think ITT Educational Services, Corinthian Colleges, or Education Management Corporation.

In a speech titled "Subprime Goes to College," delivered Wednesday at the Ira Sohn Investment Research Conference, Eisman blasted the for-profit education industry, likening these companies to the seamy mortgage brokers who peddled explosive subprime loans over the past two decades. "Until recently, I thought that there would never again be an opportunity to be involved with an industry as socially destructive and morally bankrupt as the subprime mortgage industry. I was wrong," Eisman said. "The for-profit education industry has proven equal to the task." (All of Eisman's remarks here come from a copy of his prepared remarks obtained by Mother Jones.)

Eisman, a blunt, no-frills portfolio manager at FrontPoint Financial Services Fund, a Morgan Stanley subsidiary, became an overnight sensation as one of the main characters in Lewis' latest. After witnessing the first wave of subprime madness in the 1990s, Eisman grew skeptical of the industry as a whole, Lewis writes. Then, when subprime surged again in the 2000s, he put his knowledge to work. Needless to say, he's a lot richer than he was two years ago.

Sarah Palin's Endorsement Curse

| Thu May. 27, 2010 4:55 AM PDT

Quiz: What do these struggling or failed political aspirants all have in common?

  • Vaughn Ward, a GOP candidate for Idaho's 1st congressional district who plagiarized Barack Obama's famous 2004 Democratic National Convention speech and thought Puerto Rico was a separate country;
  • Nikki Haley, the South Carolina gubernatorial candidate embroiled in controversy with a political blogger who claims he had an affair with Haley, who is married with two children;
  • Doug Hoffman, the conservative candidate in last fall's special House election in upstate New York's 23rd district who ultimately lost in an upset to Democrat Bill Owens;
  • Tim Burns, the Republican candidate to fill the late Pennsylvania Democratic congressman John Murtha's 12th district who lost to Democrat Mark Critz;
  • Clint Didier, the Republican candidate for Senate in Washington state trailing incumbent Democrat Patty Murray by anywhere from 15 to 26 percentage points; and
  • John McCain, the Republican loser in the 2008 presidential election

They're all the (un)lucky recipients of campaign endorsements from the Tea Party darling herself, Sarah Palin! Of course, there's no doubt Palin remains a superstar in conservative circles, her every tweet and Facebook message treated as conservative scripture these days. And she has been right on a few occasions—notably, Rand Paul in the recent Kentucky GOP Senate primary. But overall, her political seal of approval may be losing some of its luster.

And some of her fellow Republicans have noticed. In early May, Palin endorsed Carly Fiorina in the California Republican Senate primary. Later that month, Matt Rexroad, a director for political strategy group Meridian Pacific, which is employed by Fiorina's campaign, posted on Facebook  that "if Sarah Palin endorsed me I would be too embarrassed to tell anyone. [F]rom my point of view, I don't know how you quit as the governor of your state and get taken seriously." Ouch.

I guess we'll have to wait and see how the remaining candidates that Palin has blessed with her endorsement—Fiorina, Wisconsin House candidate Sean Duffy, et al—fare before deciding whether Palin's support amounts to a golden touch or the kiss of death.

Nevada's Rand Paul Primary Redux?

| Wed May. 26, 2010 12:50 PM PDT

Sharron Angle, the Tea Party favorite in Nevada's three-way Republican primary, is mounting an anti-establishment, Rand Paul-esque charge in her state's June 8 primary vote. Between late April and mid-May, Angle surged in the polls, from 13 percentage points to 25, according to R2000/Daily Kos and Las Vegas Review-Journal polling data. Meanwhile, the front-runner and GOP choice in that primary, former state GOP chairwoman Sue Lowden, dropped from 38 points to 30, and the third main candidate, Danny Tarkanian, dipped from 28 points to 22.

A former Nevada assemblywoman, Angle has seized on a handful of mistakes by Lowden, whose comfortable lead in the primary has all but eroded. Adopting the wildcard, Tea Party mantle, Angle is now bashing Lowden's fiscal record, claiming her opponent raised taxes and supported state spending hikes. Angle also unleashed the ultimate of political insults in the hard-hit Silver State, claiming Lowden—gasp!—"backed Harry Reid for years."

Whether Angle can overcome Lowden in the final days before the primary—Angle's raised a mere $945,000 for her campaign, less than half of Lowden's war chest—depends on how much she can paint Lowden as another political insider wedded to an incredibly unpopular Republican Party. Here's Angle's most recent ad attempting to do just that:

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