Corn has broken stories on presidents, politicians, and other Washington players. He's written for numerous publications and is a talk show regular. His best-selling books include Hubris: The Inside Story of Spin, Scandal, and the Selling of the Iraq War.
A giggle or two about Eliot Spitzer's attempted comeback would be quite natural. With the news that he'll be running for comptroller of New York City, the former New York governor, who resigned after he was caught in an S&Mish prostitution scandal, invites the unavoidable comparison to Anthony Weiner, another former disgraced Dem currently seeking redemption by campaigning for NYC mayor. But when Spitzer reentered public life in 2008 as a Slate columnist, I noted that his return to the national discourse was worth a cheer or two—mainly because he had been and could once again be a well-informed voice regarding the excesses of Wall Street and Big Finance. Does that mean that he should be embraced by populist-minded voters and pundits, as he embarks on his make-over campaign? Judging politicians on morality is often a personal exercise, and reasonable people (prudes and non-prudes) can reach different but equally legitimate conclusions about the connection between a candidate's personal life and his or her public standing. In other words, that's up to you.
In any event, with Spitzer now water-cooler fodder, here's the post I wrote when he first stepped out of the shadows:
It's easy to snicker at Slate magazine for signing up Eliot Spitzer, former New York governor and onetime john, as a regular columnist. But judging from Spitzer's first outing, it was a master stroke.
The manner in which Spitzer crashed and burned has essentially wiped out the pre-prostitution portion of the Spitzer tale, which included his longtime stint as a critic of corporate excesses. But Spitzer's opening column in Slate is a reminder that in these days of multi-billion-dollar bailouts, there are few powerful and knowledgeable figures in government raising the appropriate questions and challenging the save-the-rich orthodoxy.
What are we getting for the trillions of dollars in rescue funds? If we are merely extending a fatally flawed status quo, we should invest those dollars elsewhere. Nobody disputes that radical action was needed to forestall total collapse. But we are creating the significant systemic risk not just of rewarding imprudent behavior by private actors but of preventing, through bailouts and subsidies, the process of creative destruction that capitalism depends on.
A more sensible approach would focus not just on rescuing preexisting financial institutions but, instead, on creating a structure for more contained and competitive ones. For years, we have accepted a theory of financial concentration—not only across all lines of previously differentiated sectors (insurance, commercial banking, investment banking, retail brokerage, etc.) but in terms of sheer size. The theory was that capital depth would permit the various entities, dubbed financial supermarkets, to compete and provide full service to customers while cross-marketing various products. That model has failed. The failure shows in gargantuan losses, bloated overhead, enormous inefficiencies, dramatic and outsized risk taken to generate returns large enough to justify the scale of the organizations, ethical abuses in cross-marketing in violation of fiduciary obligations, and now the need for major taxpayer-financed capital support for virtually every major financial institution.
But even more important, from a structural perspective, our dependence on entities of this size ensured that we would fall prey to a "too big to fail" argument in favor of bailouts.
Spitzer has summed up the problem as well as anyone. He goes on:
Two responses are possible: One is to accept the need for gigantic financial institutions and the impossibility of failure—and hence the reality of explicit government guarantees, such as Fannie and Freddie now have—but then to regulate the entities so heavily that they essentially become extensions of the government. To do so could risk the nimbleness we want from economic actors.
The better policy is to return to an era of vibrant competition among multiple, smaller entities—none so essential to the entire structure that it is indispensable.
Spitzer, a populist in a suit, decries the "concentration of power--political as well as economic--that resided" in the Big Finance institutions that have dragged the economy down. He writes:
Imagine if instead of merging more and more banks together, we had broken them apart and forced them to compete in a genuine manner. Or, alternatively, imagine if we had never placed ourselves in a position in which so many institutions were too big to fail. The bailouts might have been unnecessary.
In that case, vast sums now being spent on rescue packages might have been available to increase the intellectual capabilities of the next generation, or to support basic research and development that could give us true competitive advantage, or to restructure our bloated health care sector, or to build the type of physical infrastructure we need to be competitive.
This is the opposite of Rubinomics. Spitzer is contemplating what must be done to rebuild our economy so that it truly competes internationally and, most important, generates wealth--not what must be done to rescue the high-fliers who have crashed and who seem to hold our credit lines and economy hostage. It's a perspective not heard within the mainstream too often these days. His views could have been influential when the first Wall Street bailout was pulled together in September--had he been part of the public discourse at the time and had he not been such a bad boy in the Mayflower Hotel.
I'm not often a fan of second acts for disgraced public officials. But in this instance, I'm glad Slate is sponsoring the Spitzer rehabilitation program. In fact, after reading his article, I'd be delighted if Barack Obama dumped Lawrence Summers and tapped Spitzer to be head of his National Economic Council.
Spitzer, after the fall he took, is not likely to rise so high. But he's demonstrated he deserves a platform. Let's hope the marketplace of ideas operates better than the marketplace of Wall Street and recognizes the merits Spitzer still possesses.
As of Monday afternoon (Eastern time), the whereabouts of on-the-run NSAleaker Edward Snowden remained unknown. But it seemed the onetime contractor might be headed to Ecuador. There's little doubt that the country's president, Rafael Correa, would relish the chance to welcome Snowden and irritate Washington. Correa has been a leading purveyor of anti-United States rhetoric in Latin America, reviving the down-with-gringos banner-waving once so popular in the region. But Correa's embrace of Snowden—if it comes to be—could produce blowback for the heavy-handed Ecuadorean leader by focusing global attention on his own, far-from-laudable policies regarding transparency, press freedoms, and refugees.
Just two weeks ago, his party passed a law in the National Assembly that, according to Human Rights Watch, "undermines free speech." HRW official José Miguel Vivanco notes, "This law is yet another effort by President Correa to go after the independent media. The provisions for censorship and criminal prosecutions of journalists are clear attempts to silence criticism."
Here's how HRW describes the law:
It prohibits so called "media lynching" which is defined as "the dissemination of concerted and reiterative information, either directly or by third parties, through media outlets, with the purpose of undermining the prestige" of a person or legal entity or "reducing [their] credibility." The provision would allow the authorities to order the media outlet to issue a public apology and states that they are also subject to criminal and civil sanctions, imposed by the courts.
It requires media outlets to issue their own codes of conduct to "improve their internal practices and their communications work" based on a series of requirements such as to "respect people's honor and reputation." Although self-regulation of this nature is not in itself problematic, the law provides that any citizen or organization can report that a media outlet violated the requirements, and government authorities can issue a written warning, or impose sanctions.
It says that journalists must "assume the subsequent administrative consequences of disseminating content through the media that undermines constitutional rights, in particular the right to communication, and the public security of the State." Journalists deemed to violate this responsibility could be subject to civil, criminal or other sanctions.
The law would essentially allow Correa's government to criminalize journalism that inconveniences the president and his allies. HRW points out that human rights advocates generally oppose granting government the power to charge journalists with a crime for publishing derogatory information about public figures: "International bodies from the Inter-American, European, and United Nations human rights systems have long criticized the use of criminal charges to respond to media allegations made against public officials, as contrary to the interest of promoting vibrant public debate necessary in a democratic society." But that's what Correa's party has sought to do. Vivanco puts it this way: "Giving the government the power to decide whether or not information is 'truthful' will open the door to unlawful censorship. This is an especially alarming provision in a country where the president has a track record of using his powers to target critics in the press."
The law would essentially allow Ecuador to criminalize journalism that inconveniences the president and his allies.
This is not Correa's first stab at media intimidation. In July 2011, an Ecuadorean court sentenced a reporter for El Universo, a newspaper based in Guayaquil, and three members of the paper's board to three years in prison for defamation because the paper criticized Correa. The reporter, Emilio Palacio, had written an opinion piece that referred to the president as a "dictator" for having considered pardoning people involved in a police rebellion that included an attack on a hospital. The criminal case was triggered by a defamation suit filed by Correa.
With the suit and the recent law, Correa has shown he's no fan of a free media and a vibrant national debate—at least not when he and his actions might be the focus. In its most recent ranking of international press freedoms, Reporters Without Borders scored Ecuador toward the bottom: "Ecuador fell 15 places to 119th after a year of extreme tension between the government and leading privately-owned media." In its annual report on Ecuador, Amnesty International notes that "there were concerns that laws dealing with the crime of insult were being used against journalists in violation of the right to freedom of expression and could deter other critics of government authorities from speaking out" and that "indigenous and community leaders faced spurious criminal charges aimed at restricting their freedom of assembly." And HRW has also assailed Correa for not respecting the due process rights of asylum seekers. (Snowden's standing as a persecuted refugee is far from certain.)
Correa might boost his anti-Yankee creed by sheltering Snowden and seek to portray himself as a protector of the persecuted. "Human rights will take precedence over any other interests or pressure that some might want to exert,” Ecuador Foreign Minister Ricardo Patiño said on Monday regarding the possibility Snowden would find asylum in Ecuador. But by bear-hugging Snowden, Correa would draw attention to his own history of opposing a robust press that dares to challenge the powers that be.
CLARIFICATION: This piece neglected to report that Correa eventually pardoned Palacio and the three other journalists. But he was unrepentant about having pursued the case. At the time of the pardons, Reuters reported Correa said, "They have been talking about a dictatorship and they were right because there's a dictatorship and there's a government that has been fighting that dictatorship, the dictatorship of the media." The news service also noted, "The Miami-based Inter American Press Association said media freedom was still under attack in Ecuador regardless of Correa's decision."
Given the chance to shoot down affirmative action, the Supreme Court, in a 7-1 decision, chose not to (PDF). But it did say that a lower court decision that had approved the University of Texas' affirmative action program needed to be revisited, with the justices in the majority noting that this appeals court had not applied a stringent enough rule when reviewing the UT program. In short, the court said: Affirmative action is indeed permissible, but only in instances when the public benefit is narrowly defined and justified—and there is strict scrutiny of such factors.
The decision is mostly about how the lower court handled the case, which involved a white student whose application to the college was denied. (For more background on the case see here.) The majority noted, "The reviewing court must ultimately be satisfied that no workable race-neutral alternatives would produce the educational benefits of diversity." And the appeals court, it ruled, did not:
Rather than perform this searching examination, the Fifth Circuit held petitioner could challenge only whether the University's decision to use race as an admissions factor "was made in good faith." It presumed that the school had acted in good faith and gave petitioner the burden of rebutting that presumption.
What does the IRS scandal have to do with the recent disclosures about National Security Agency surveillance programs that sweep up phone records and internet communications? The answer doesn't involve President Barack Obama thuggishly conspiring to spy on political foes and average Joes. But the two controversies have this in common: congressional oversight. The NSA leaks underscore the compelling need for vigorous and extensive monitoring of secret government action by congressional leaders who are elected to look out for the public's interest. The trumped-up IRS scandal shows how many of those leaders cannot be trusted to take their oversight duties seriously.
In recent weeks, Republican leaders in Congress have waved the banner of oversight, as they have attempted to turn the Benghazi tragedy and then the IRS revelations into partisan fodder. Instead of responsibly probing significant questions of government malfeasance or nonfeasance (did IRS vetters inappropriately target right-wing groups, and did the State Department fail to provide adequate security for its Benghazi facility?), the GOPers whipped up frenzied anti-Obama narratives that crumbled once facts emerged. The White House release of emails undercut Republican claims of a Benghazi cover-up. And Rep. Elijah Cummings' release of an interview with an IRS manager indicated that GOP accusations of White House involvement in the heightened scrutiny of tea party groups seeking nonprofit status were based on…nothing.
A more telling case study is Rep. Mike Rogers, the chairman of the House Intelligence Committee, who demonstrated just how far off the rails a legislator in whom the public must place its trust can go.
A month ago, Rep. Darrell Issa (R-Calif.), the chair of the House Oversight Committee, claimed that the IRS scandal entailed "the targeting of the president's political enemies" and White House "lies." His brethren issued similarly breathless declarations. Rep. Hal Rogers (R-Ky.), chair of the House Appropriations Committee, referred to "the enemies list out of the White House that IRS was engaged in shutting down." And Rep. Dave Camp (R-Mich.), chair of the Ways and Means Committee, asserted, "we know" the IRS affair "didn't originate in Cincinnati," where the out-of-line vetters were based. All this white-hot rhetoric suggests Issa and the others cannot engage in the sort of reasonable, responsible, and nonpartisan oversight activity that is necessary if the executive branch is allowed to conduct sweeping surveillance that has the potential for abuse.
Issa, Rogers, and Camp have not demonstrated the credibility that is required of lawmakers whom the public must rely upon to ensure the government is functioning effectively and responsibly, especially when it mounts highly covert operations. To be fair, none of these men are directly charged with watching over the snoops and spies of the intelligence community, but they do undermine the overall notion of congressional oversight. A more telling case study is Rep. Mike Rogers (R-Mich.), the chairman of the House Intelligence Committee, for he has demonstrated just how far off the rails a legislator in whom the public must place its trust can go.
This past weekend, on Face the Nation, Rogers veered from discussing the NSA leaks to talking about the IRS controversy. The IRS affair, he insisted, "clearly showed some criminal behavior that at least we know was back at 1600 Pennsylvania Avenue." Wait a moment: Rogers was tossing out fake GOP talking points claiming Obama's crew had broken the law in the IRS mess.
When host Bob Schieffer asked Rogers if he was connecting "criminal activity" to the White House, Rogers replied:
No. What I'm saying is the White House themselves have admitted that people in the White House knew about this behavior, and I think that investigation is still ongoing. Clearly, when the government in any way, shape, or form uses its power to intimidate citizens who are donating to whatever their political belief—Republican or Democrat—that's a criminal activity. And the fact that initially was said it wasn't at the White House, and later said, well, people did know at the White House, so it's clearly gotten to the front steps.
Rogers was being sly—and disingenuous. He had claimed criminal activity had occurred at the White House. When called on that, he shifted his argument and asserted that the White House had been aware of the IRS wrongdoing—and had admitted being aware.
That was not accurate, either. The issue of White House awareness has focused on when Obama and his aides learned of the internal investigation of the alleged IRS wrongdoing. Last month, White House press secretary Jay Carney outlined who at the White House knew what—and when they knew it—about the inspector general inquiry into the IRS scrutiny of conservative groups. Carney noted that the first the White House had heard of anything related to the IRS screwup was when the president's counsel in April was informed that a report on this matter was being finalized. This was a full year after the alleged misconduct had stopped.
Rogers was mangling the known facts and conflating White House knowledge of the report with concurrent awareness of the improper activity. Either he had not paid attention to the public record, or he was purposefully concocting a way to slam a political opponent. Whatever the case, this episode is reason to be wary of Rogers' ability to provide evenhanded oversight.
Since the NSA story broke, Rogers has been front and center, vouching for the surveillance programs and insisting that the system of checks and balances that governs clandestine surveillance works. And he is one of the most important cogs in this oversight machine. In theory, the president and his intelligence agencies are only allowed to engage in secret operations because Rogers and other elected officials in the legislative branch of the government keep a close watch on the cloak-and-dagger gang and tell the rest of us that all is kosher. But with Rogers engaging in partisan hackery (on the IRS issue), his word (on NSA surveillance) is not worth that much. And that's a problem. If the overseers within Congress cannot be trusted on public matters, how can the American citizenry believe them when they say it's okay to trust the dark-shadows crowd?
The news cycle can be a silly place. The Republicans in recent months have sucked up a lot of oxygen with a phony scandal (Benghazi) and a trumped-up scandal (the IRS's improper targeting of tea party groups for scrutiny). The White House has been pinned down by some of this, while also contending with a very real and front-page debate over NSA surveillance prompted by leaks regarding two of its super-secret programs. Yet one matter that is perhaps more important than all of this and that is in the news for the moment registers much lower on the media Richter scale: trying to prevent humans from blowing up the one planet they have.
On Wednesday, President Barack Obama announced a new guidance for US nuclear weapons policies, and it's a big deal. It follows Obama's 2009 Prague speech, in which he declared the long-term goal of zeroing out nuclear weapons. According to a White House fact sheet, the new guidance "narrows U.S. nuclear strategy to focus on only those objectives and missions that are necessary for deterrence in the 21st century" and "directs DOD to strengthen non-nuclear capabilities and reduce the role of nuclear weapons in deterring non-nuclear attacks." The fact sheet notes, "the guidance takes further steps toward reducing the role of nuclear weapons in our security strategy." In non-wonk terms that means the US military will alter its planning that might entail the use of a nuclear weapon. And Obama's new guidance declares that it would be reasonable to cut the level of strategic nuclear weapons by a third, beyond the lower levels Obama negotiated with the Russians for the New START treaty. Obama announced this proposed reduction in a Berlin speech.
All of this is receiving some news coverage today, but it won't draw a smidgeon of the attention the assorted quasi-scandals do. Yet the effort to lower the possibility of a nuclear war is one of the most noble and significant endeavors for a president. (Addressing climate change ranks high, too.) Still, not since the early 1980s, when literally millions of Americans took to the street to protest President Ronald Reagan's nuclear policies, has this been a hot political subject. It may be that the notion of a nuclear conflagration is too overwhelming to consider on a routine basis. Certainly, it's more fun to fret about a stolen (or not stolen) Super Bowl ring.
Arms controllers did hail Obama's actions. The Ploughshares Fund noted that the president "has finally replaced the nuclear guidance issued in 2002 by President George W. Bush with new policies that will reduce the roles, numbers and alert rates of nuclear weapons in US national security strategy." (The United States currently maintains 7000 nuclear weapons in its arsenal.) And the Union of Concerned Scientists applauded Obama's nuclear policy reform and urged him to go further, noting the United States "can maintain a robust deterrent with less than a 1,000 nuclear weapons—including strategic and tactical, deployed and stored—independent of Russia’s arsenal. Maintaining more weapons than needed undercuts U.S. security and wastes taxpayer dollars." Hawks, inevitably, will denounce Obama's attempt to reduce the United States' warehouse of nukes and to decrease the significance of nuclear weapons in contingency planning. Yet it's unlikely that a robust debate will erupt to equal the fuss over, say, Michelle Obama's latest hair style. But for anyone who is serious about divining crucial national security differences between Obama and his predecessors, Obama's new nuclear posture is significant and worthy of much notice.