Mojo - February 2010

If it Looks Like Blackwater and Acts Like Blackwater...

| Wed Feb. 24, 2010 5:32 PM EST

Why did Blackwater set up a new corporate identity when it inked a subcontract with Raytheon to train Afghan troops? Masking its scandal-tainted brand was the brainchild of its defense contractor client, according to a top executive for Xe Services (as Blackwater is now known).

Testifying before the Senate Armed Services Committee on Wednesday, Fred Roitz, an executive vice president at Xe, pulled back the curtain on the creation of Paravant, LLC. He suggested that Raytheon wanted to do business with Blackwater—so long as it didn't appear that it was actually doing business with the controversial security firm. Roitz said it was his "understanding... that the request for a company other than Blackwater came from Raytheon."

So Paravant was born. As Brian McCracken, a former Paravant vice president who now works for Raytheon, acknowledged, the subsidiary and Blackwater were effectively "one and the same." Along with a bank account and address, Paravant also shared its corporate parent's propensity for stirring up controversies. In May, two of the firm's trainers, Justin Cannon and Christopher Drotleff, opened fire on an oncoming car, killing two Afghan civilians and wounding a third. The men are currently being prosecuted by the Justice Department on second-degree murder and weapons charges. A months-long investigation by the armed services committee followed, unearthing evidence [PDF] that Paravant personnel had acted recklessly, disregarded military regulations, and improperly acquired hundreds of AK-47s and other firearms that were intended for use by the Afghan National Police. The probe also indentified a series of vetting lapses by Blackwater and major oversight failures by the army officials that were supposed to be supervising its work.

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Inside the Chamber's Free Enterprise Campaign

| Wed Feb. 24, 2010 3:57 PM EST

National Journal has a fantastic new piece out today about the Chamber of Commerce's advocacy campaign to "defend and advance America's free enterprise values." Turns out, it's not going quite as well as they hoped, and is even drawing criticism from some conservatives for being more about raising money for the Chamber than it is about promoting an agenda in a meaningful way.

But that's not to say it hasn't been effective. The Chamber is expected to report $250 million in revenues last year, a 25 percent increase over 2008. It spent $123 million on lobbying last year, nearly twice as much as it did in 2008. The group has launched a campaign to gather 1 million voter contacts that it can use to advance its electoral and policy agenda. And its non-profit wing, the National Chamber Foundation, is planning an initiative to get educational information about "the free enterprise system" into elementary and high schools across the country (nothing like starting early!).

Among the more interesting elements of the article: apparently the Chamber approached some major corporations, like ExxonMobil, about funneling more money into the group's advocacy work, but met hostility. Instead, Chamber president Tom Donohue is turning increasingly to very wealthy individuals for support:

When he launched the campaign last spring and summer, Donohue initially talked to ExxonMobil and some other longtime financial angels about committing new funds to the project, according to lobby sources. Executives at two companies that he approached let it be known that they had already made big contributions to other chamber efforts, such as the Institute for 21st Century Energy. (Chamber officials dispute that these corporations gave them the cold shoulder.)
The executives suggested that Donohue consider approaching wealthy individuals in such sectors as energy, financial services, and high tech, according to a lobbyist close to the chamber.
Donohue has done just that. For the first time in chamber officials' memory, he is seeking to finance most of the campaign through donors outside of the corporate community. He has been searching out individuals, who, as Donohue puts it, "have done exceedingly well in a free enterprise system" and asking them for contributions as high as six and seven figures. "These are people who said, 'Hey, I never could've done this anywhere else in the world, and it's probably a good idea to remind everybody how it worked.' "

The piece is worth a read.

Obama: Markets No Better than Pre-Crisis

| Wed Feb. 24, 2010 3:49 PM EST

In a speech today to the powerful coalition the Business Roundtable, President Obama tried to rally some of the biggest players in the US economy around his plans to re-regulate the financial system—a system, he warned, "with the same vulnerabilities that it had before this crisis began." Obama was speaking to the Business Roundtable at their quarterly meeting in Washington, and set aside a few minutes in his speech—which ranged from job creation to international trade to health care—to emphasize the need for reining in Wall Street and preventing the kinds of reckless risk-taking and outright gambling that fueled the subprime meltdown and the Great Recession. "If we don't pass financial reform," he said, "we can expect more crises in the future of the sort that we just saw."

Here's more from his speech calling on the need for greater—and smarter—financial reform:

[A]s I said in the State of the Union, my goal is not to punish Wall Street. I believe that most individuals in the financial sector are looking to make money in an honest and transparent way. But if there aren't rules in place to guard against the recklessness of a few, and they're allowed to exploit consumers and take on excessive risk, it starts a race to the bottom that results in all of us losing.

And that's what we need to change. We can't repeat the mistakes of the past. We can't allow another AIG or another Lehman to happen again. We can't allow financial institutions, including those that take your deposits, to make gambles that threaten the whole economy. What does that mean? It means we've got to ensure consolidated supervision of all institutions that could pose a risk to the system. It means we have to close loopholes that allow financial firms to evade oversight and circumvent rules of the road. It means that we need more robust consumer and investor protections.

And I ask the Business Roundtable to support these efforts. There are lobbyists on the Hill right now trying to kill reform by claiming that it would undermine businesses outside of the financial sector. That is not true. This is about putting in place rules that encourage drive and innovation instead of shortcuts and abuse. And those are rules that will benefit everybody.

The Oath Keeper Candidate

| Wed Feb. 24, 2010 3:20 PM EST

Debra Medina almost certainly won't be the next governor of Texas. According to recent polls from Public Policy and Rasmussen, the Tea Party insurgent's momentum has crashed full-speed into the proverbial wallor, as the case may have it, Sen. Kay Bailey Hutchison's wire fence. But I think the fixation, by TPM and others, on Medina's drop in the polls in the wake of her Vesuvian performance on Glenn Beck really misses the point. Medina was bound to lose at least a handful of swing votes; what's remarkable is just how much of her base (16 to 20 percent of likely voters, depending on the poll) is sticking with her.

'School of Shock' Under Federal Investigation

| Wed Feb. 24, 2010 2:26 PM EST

More than two years after Mother Jones published a groundbreaking investigation of the Judge Rotenberg Center (JRC), a private school in Massachusetts that uses electric shocks to discipline its mentally retarded and autistic students, the federal government is finally looking at the school. The Department of Justice's Civil Rights Division says it has opened a "routine investigation" (PDF) of the Rotenberg Center in response to a September 2009 letter signed by 31 disability organizations that contended the school violated Title III of the Americans with Disabilities Act. 

"The initial response of the Department of Justice was that they didn't believe that they could take action because they didn’t believe they had jurisdiction over privately operated facilities," wrote Nancy Weiss of the National Leadership Consortium on Developmental Disabilities. "I suggested to them that they consider jurisdiction under the ADA on the basis that people with disabilities are being treated in ways that are neither legal nor would be tolerated if applied to people who do not have disabilities." Weiss reported that the DOJ couldn't give her an estimate on how long their investigation would take.

This is far from the first time the Rotenberg Center has come under fire for its controversial punishments, called "aversives" which include food restriction, isolation, and physical restraints. Because some children from District of Columbia attend the residential school, DC Schools Chancellor Michelle Rhee called for an investigation into the center in 2007, and Massachusetts State Senator Brian Joyce has introduced several laws to ban the use of electric shock devices on students. This is not to mention a damning investigation by the New York State Education Department and statements by then-Governor Elliot Spitzer that the school was "wrong" and he would pull New York students if possible. This could be disastrous for the Rotenberg Center as New York state supplies, and funds, many of the school's out-of-state students. More recently, JRC was fined tens of thousands of dollars for allowing 14 unlicensed clinicians to label themselves "psychologists." Although the House Education and Labor Committee recently introduced a bill that would ban the use of restraints on students, and another which would establish an abuse reporting system for residential schools which could potentially apply to the Rotenberg Center, this is the first real federal attention the school has received. And while disability rights groups are celebrating the DOJ's investigation, if the DOJ decides in the JRC's favor, it will be a major setback. Wrote Weiss, "We can only keep our fingers crossed that this is the first step in righting a long history of wrongs."

Which Agency is Most Open?

| Wed Feb. 24, 2010 2:21 PM EST

Which government agencies are most transparent? Which are the least open? The surprising answers are in a new report from OMB Watch, a good-government group that monitors the White House's Office of Management and Budget. The report shows that some agencies, such as NASA, the General Services Administration, the State Department, and the Department of Education, are doing a halfway decent job adhering to the minimum requirements of the "Open Government Directive" [OGD] released by the White House late last year. But even NASA scored only 40 of a potential 57.5 points on OMB's scale, and most agencies did a whole lot worse—including, tellingly, the White House itself:

While agencies did generally meet the minimum requirements of the OGD for the new webpages, several scored particularly low in this review. The bottom five agencies, excluding those that failed to put up any open government page, were the Office of Management and Budget (OMB)/White House, the Department of Agriculture, FDIC, the Department of Health and Human Services, and the Department of Justice... [N]one of the bottom agencies' have Inspector General reports, a link to Recovery Act data, reports to Congress, budget justifications, or performance results that can be easily found from the new webpages. Similarly, several laggard agencies, including FDIC, Department of Health and Human Services, OMB/White House, as well as others, failed to link to public participation tools for collecting input and open government ideas as mandated by the OGD.

You read that right: the White House agency that promulgated the open government plan has trouble living up to the spirit, if not the letter, of its own rules. That's pretty sad.

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Glenn Beck, Environmentalist?

Wed Feb. 24, 2010 1:40 PM EST

Is Glenn Beck, right-wing TV superstar and Tea Party darling, a closet treehugger? If you've read his books or watched his show or listened to his radio broadcast, you'd consider such a question insane, even blasphemous. But as our own Kate Sheppard writes, Beck's private views on the environment and climate change are startlingly different from his public stance:

In fact, Beck appears not only to be convinced that global warming is real, but that it's a genuine problem. "You’d be an idiot not to notice the temperature change," he [told USA Weekend recently]. He also says there’s a legit case that global warming has, at least in part, been caused by mankind.

The article also says that Beck has felt compelled to "buy a home with a 'green' design and using energy-saving products." "I’m willing to do anything but use the CFLs," he tells USA Weekend, referring to energy efficient light bulbs. "I put them in once and couldn’t stand the way they lit up the room." These are hardly the words or actions of a hardcore climate denialist.

The comments—made in passing during the course of a longer interview—attracted almost no attention. But they've stirred up a frenzy among right-wingers in certain corners of the web who are horrified to hear their standard-bearer sounding suspiciously like Al Gore. Prison Planet, a news hub for conservative conspiracy theorists, called his remarks "a shocking stab in the back of conservatives who consider Beck to be their anointed leader." A post on the interview provoked more than 200 comments on the right-wing website Free Republic, with one asking whether Beck was "moving to the left," and another saying the news was the "final straw for Beck with me." WorldNetDaily attempts to explain the remarks by musing that they perhaps reflect Beck's "kinder, gentler" side. (In the same interview, Beck also admits to liking liberal celebrity George Clooney, and it's noted that his publicist is Matt Hiltzik, a Democratic heavy hitter who worked on Hillary Clinton's Senate campaign.)

On his show, Beck had plenty of criticism of the USA Weekend story. But he didn't raise any objections to the article's portrayal of his environmental views. That must leave his supporters contemplating the possibility that when it comes to climate change, Beck may not really be one of them.

Bloggingheads.tv: Corn & Pinkerton on Health Care Summit

| Wed Feb. 24, 2010 12:47 PM EST

Once again, Jim Pinkerton and I faced off on the most pressing issues of the cyber-moment for Bloggingheads.tv. Regarding Thursday's health care summit, we agreed that it won't be of much use—to either side. (I explain this further here.) But we bickered over Jim's assertion that the stimulus—and economic recovery—has been stymied by environmentalists and their darn rules, especially when it comes to high-speed rail projects. I asked Jim repeatedly to cite a specific project that has not taken off because of those pesky environmental regulations. Astute watchers will note Jim couldn't come up with one. Comity was restored, though, when we both explained why we enthusiastically support the Demand Question Time campaign. Finally, we mulled Rahm Emanuel's past, present...and future.

Here's the show:

 

 

You can follow David Corn's postings and media appearances via Twitter.

Did Blackwater Rescue Alan Grayson in Niger?

| Wed Feb. 24, 2010 12:35 PM EST

Before joining Congress, Rep. Alan Grayson (D-Fla.) was the scourge of military contractors, filing dozens of whistleblower lawsuits against companies who defrauded the government in connection with their work in Iraq. In the past, the freshman lawmaker, who's known for his pugilistic style and no-holds barred remarks, has blasted the firms working on the payroll of the US government overseas: "We're not going to let the defense contractors use our money to bribe our government and take it over," he once said. And he has singled out Blackwater (now known as Xe) for special criticism: "We can't let, basically, Blackwater take over the entire government here. We have to draw the line somewhere."

But did Blackwater contractors come to his rescue last week, when Grayson was traveling in Niger and a military coup erupted? It certainly seems that way, considering the prepared testimony of Xe executive vice president Fred Roitz, who will testify later today in connection with a Senate Armed Services Committee hearing on Blackwater subsidiary Paravant. In his remarks, he stated: "Xe Services, through its subsidiary Presidential Airways, provides aviation support and medevac services to Defense Department personnel in Africa. Just last week, our personnel evacuated a congressman from Niger during civil unrest."

The description certainly seems to fit the dicey circumstances Grayson found himself in last week. As CNN reported:

Rep. Alan Grayson, D-Florida, narrowly escaped harm earlier this week after being caught up in a military coup in the African country of Niger.

Grayson's press secretary, Todd Jurkowski, confirmed to CNN that Grayson was close to the action. "He heard the gunshots. They were literally in the building next door."

The outspoken congressman was in Niger as part of a congressional delegation focused on science, technology and humanitarian relief, according to Jurkowski. When the situation began to unravel, Grayson was taken to the residence of the United States Ambassador to Niger, where he was placed under armed protection.

Roitz offered his remarks in defense of Xe's personnel, who he described as "good corporate citizens," who "support numerous charitable and civic organizations in the region, including the Special Olympics, the USO, the Boy Scouts, and local nonprofit food service organizations."

In his prepared statement, Roitz said that Xe was a changed company following the departure of a series of high-level Blackwater employees and installation of a new management team. "Unfortunately, there were times when the first priority of the former leadership of the company was supporting those missions, even at the expense of complying administrative and regulatory requirements," Roitz said, referring to the firm's work in Iraq and Afghanistan. "That will not happen under the company's new leadership team, which emphasizes core values of honesty, integrity, reliability, and accountability." He also said the company is "in many significant ways, a new company when compared to the old Blackwater."

As for Grayson, if he was in fact saved by Blackwater, I wonder whether the experience has given him a newfound respect for the work of contractors. I have a call in to Grayson's spokesman. I'll update this post when I hear back.

UPDATE: Todd Jurkowsk, Rep. Grayson's spokesman, says the congressman's office is still trying to confirm whether he was in fact evacced by Presidential Airways. "The flight was arranged through the State Department," Jukowski says. "The Congressman did not know, and frankly did not care, who owned the plane.” On the subject of contractors, Jurkowski added, "The Congressman does not deny that there is admirable work being done by some employees of private contractors.  However, he stands by his criticism of companies who have been found to cheat the American people, defraud our government, and unnecessarily risk the lives of members of our military, all in the name of making a profit."

UPDATE 2: Case closed.

Advocate: Rein in CEOs!

| Wed Feb. 24, 2010 11:33 AM EST

The pro-financial reform organization Americans for Financial Reform (AFR) today sent a letter [PDF] to the Senate banking committee, who's leading financial-reform talks right now and is expected to release a bill next week, to make sure it includes new oversights and protections of corporate boards—the very leaders, AFR says, who blindly let financial markets implode under their watch:

"Institutional investors have recognized that risk management oversight failures by the boards of Wall Street banks were a central factor in the financial collapse. Moreover, it is well documented that the executive compensation plans prevalent on Wall Street, in which the vast majority of pay comes through stock options and bonuses based on short-term performance, ensured that bank executives reaped huge gains while the housing bubble grew, but suffered none of the downside when their over-leveraged bets and gambles on complex derivatives went sour."

In a November financial-reform discussion draft in the Senate [PDF], a number of investor protections and executive-compensation crackdowns were included, like giving shareholders a "say on pay" and requiring a majority vote for uncontested director elections, among others. Right now, though, it's unclear whether those reforms from last fall will make it into the draft being crafted by Sen. Chris Dodd (D-CT), the committee's chairman, Sen. Richard Shelby (R-AL), the ranking member, and Sen. Bob Corker (R-TN), who joined Dodd after Shelby briefly dropped out of the talks earlier this month.

AFR's letter is intended as well a counterbalance to recent lobbying efforts, most visibly those by the US Chamber of Commerce, to oppose corporate-governance reform. For instance, Chamber CEO Tom Donahue said in January that the "mad scientists" who created tricky financial instruments (read: synthetic collateralized debt obligations, derivatives, option adjustable-rate mortgages) deserved the high salaries and bonuses they've earned in the past. However, AFR goes after Donahue in today's letter, citing his past leadership roles in maligned companies like Qwest and Sunrise Senior Living, and says his checkered record in corporate governance should cast serious doubt on any of his reform suggestions. "The US Chamber under Mr. Donohue is uniquely unqualified to speak credibly on what corporate governance structures are necessary to protect shareholder wealth," the letter concludes.