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Elizabeth Warren Slams Wall Street Again

Erika Eichelberger — Fri, 17 May 2013 21:29:03 +0000

On Thursday, bank-basher Sen. Elizabeth Warren (D-Mass.) slammed several bills headed for the House floor that would severely weaken Wall Street reform.

The Dodd-Frank Act, the 2010 law aimed at preventing another financial crisis, "put in place a variety of measures that work together as a system to protect consumers, hold big banks accountable, and reduce the risk of future crises," Warren said in a statement. "It is dangerous for Congress to amend the derivatives provisions of the Dodd-Frank Act." (Derivatives are financial products that have values based on underlying numbers, like crop prices or interest rates; some economists believe these products helped cause the 2007 financial collapse.)

Warren's condemnation of the bills, which just passed out of the House Financial Services Committee (HFSC), echoes a May 6th letter from Treasury secretary Jack Lew to House Financial Services Chair Jeb Hensarling attacking the bills. "The derivatives provisions in the Wall Street Reform Act constitute an important part of the reforms being put into place to strengthen our financial system by improving transparency and reducing risk for market participants," Lew wrote in the letter. "These reforms should not be weakened or repealed." Last year, former Treasury Secretary Tim Geithner denounced a series of nearly identical bills.

One of the bills now headed to the House floor would expand the types of trading risks that banks can take on. Another would allow certain derivatives that are traded within a corporation to be exempt from almost all new Dodd-Frank regulations. Financial reform advocates say these kinds of trades can still pose a risk to the wider financial system. A third bill would allow big, multinational US-based banks to escape US regulations by operating through international arms.

"Wall Street's aggressive determination paid off last week" when the bills passed out of committee, Warren said. The bills also have bipartisan support, and have a good chance of being taken up in the Senate. If they do, Warren says she'll go to battle: "Now is no time to go backwards," she said. "I will do what I can in the United States Senate to stand up to those who would chip away at reform."

Ad Slams Arizona Sen. Flake for Flaking on Background Checks

Gavin Aronsen — Fri, 17 May 2013 19:40:05 +0000

Last month, Republican Sen. Jeff Flake broke with his Arizona colleague John McCain to vote against the background check compromise brokered by Sens. Joe Manchin (D-W.Va.) and Pat Toomey (R-Pa.). Soon after, Caren Teves, the mother of Aurora mass shooting victim Alex Teves, went public with a note she had received from Flake the week before he, well, flaked. In the note, the junior senator wrote that "strengthening background checks is something we agree on."

On Friday, Michael Bloomberg's Mayors Against Illegal Guns (MAIG) released an ad featuring Caren Teves that will air in Phoenix and Tucson through the end of the month. In the ad, Teves shows the handwritten letter Flake sent her. "The issue isn't just background checks," she says. "It's keeping your promise. And Senator Flake didn't."

Flake has disputed the ad's claim in a Facebook post. "If you are anywhere close to a television set in Arizona in the coming days, you’ll likely see an ad about gun control financed by NYC Mayor Bloomberg," he wrote. "Contrary to the ad, I did vote to strengthen background checks," referring to his vote for the alternate gun amendment introduced by Sen. Chuck Grassley (R-Iowa) that included weaker measures to strengthen background checks (and was also voted down).

MAIG and other gun reform groups have vowed to hit Manchin-Toomey opponents hard. Opponents of the compromise have seen their poll numbers drop, and polling by MAIG and other organizations has consistently shown overwhelming support for expanded background checks.

There have been quiet discussions on the Hill about reintroducing an amendment with further concessions to Republicans. But in a meeting with reporters at the Capitol on Wednesday, Sen. Harry Reid (D-Nev.) said that although he'd been in daily talks with senators about bringing background checks back for a vote, the Democrats still didn't have the 60 votes needed to get it passed. Asked if there were any new supporters, Reid replied, "Maybe."

IRS Speaks Out: We Messed Up, But We Would've Scrutinized Tea Partiers Anyway

Andy Kroll — Fri, 17 May 2013 18:35:55 +0000

Finally, the IRS is giving a full accounting of how and why its staffers singled out tea partiers and other conservative groups seeking tax-exempt status. The quick version: We had the right idea but went about it all wrong.

On Friday morning, Steven Miller, the acting IRS commissioner set to resign due to the scandal, appeared before the House ways and means committee and testified that several IRS employees made "foolish mistakes" by using catchwords like "tea party" and "patriots" as they picked through hundreds of nonprofit applications from groups that might be involved in politics. Miller described his agency's behavior as "obnoxious." Yet he denied that the IRS vetters who handled all those applications for groups wanting 501(c)(4) nonprofit status—who were working out of a field office in Cincinnati—acted out of political bias. Instead, he said the agency's errors "were made by people trying to be more efficient in their workload selection."

Prior to Miller's testimony, the IRS itself took the unusual step of posting on its website 14 questions related to the tea party debacle and the agency's official response to each one. It's an interesting and useful document.

The IRS insists that its staffers, as Miller emphasized, were wrong to target groups with "tea party" or "patriots" in their name. However, the agency says that it would've zeroed in on tea partiers and other conservative groups anyway, as it looked for applicants that might be getting too involved in politics. They sought out politically-inclined groups because 501(c)(4) nonprofits are allowed to dabble in politics but cannot make it their "primary activity." But as they looked for groups that might be too political, they used inappropriate shortcuts.

"IRS employees had seen cases of organizations with the name Tea Party in which political activity was an issue that needed to be reviewed for compliance with legal requirements," the agency says. "Because of the increased inventory of applications, this inappropriate criterion was used as a shortcut to centralize similar cases." In other words, as a booming number of tea party outfits across the country were filing for tax-exempt status, the folks in charge of reviewing such applications—and making sure applicants were not engaged in so much political action that they would not qualify for this tax status—found it convenient to flag groups with "tea party," "patriot," and "9/12 Project" in their name.

The agency also says on its website that it found "no indication of political bias"—echoing the Treasury Department inspector general who investigated the tea party mess. The IRS staffers in Cincinnati didn't have a grudge for the tea party; they felt, it seems, that tea partiers were simply more prone to get involved in politics.

The agency also offered a few basics on how it handles nonprofit applications. All applications go through Cincinnati, where there are less than 200 people who directly handle those files. Because the agency saw an increase in 501(c)(4) applications from potentially politically active groups, staffers there pooled all those applications together and gave a few selected employees the job of scrutinizing those applications.

Some more interesting nuggets in the Q-and-A:

Not only has the IRS seen an uptick in the number of 501(c)(4) applications, it says the number of groups applying that could become involved in politics has risen as well.
The IRS admits it mistakenly caused "inappropriate delays" for groups applying for tax-exempt status, and made "over-expansive information requests" of the groups it singled out for extra scrutiny. The IRS blamed this on "ineffective processes."
In 2010 and 2011, as we've reported, IRS staffers specifically looked for groups with "tea party" or "patriots" in their name. However, of the nearly 300 groups with applications flagged by IRS staffers, the vast majority did not have either of those words in their name.

The IRS Q-and-A links to a list of almost 170 nonprofit groups given special scrutiny by IRS staffers but later approved for 501(c)(4) status. The entities on that list run the political gamut and include local tea party groups, statewide progressive organizations such as Progress Texas and Progress Missouri Inc., former Sen. Russ Feingold's Progressives United outfit, and issue-based organizations such as Californians Against Higher Health Costs and Homeless But Not Powerless.

Here is the full list from the IRS' website:

We're Still at War: Photo of the Day for May 17, 2013

Fri, 17 May 2013 16:38:06 +0000

Lance Cpl. Brandon King, a driver with Delta Company, 1st Tank Battalion, performs maintenance on an M1 Abrams Tank at Forward Operating Base Shir Ghazay, Afghanistan, April 5, 2013. U.S. Marine Corps photo by Sgt. Tammy K. Hineline.

Corn on Hardball: What's Obama's Next Move On the IRS Scandal?

Thu, 16 May 2013 19:01:42 +0000

Did President Obama make the right move when he ousted IRS commissioner Steven T. Miller yesterday? DC bureau chief David Corn joins the Huffington Post's Howard Fineman to discuss Miller's resignation on MSNBC's Hardball:

David Corn is Mother Jones' Washington bureau chief. For more of his stories, click here. He's also on Twitter.

What Obama Meant When He Said He Fantasizes About "Going Bulworth"

Asawin Suebsaeng — Thu, 16 May 2013 16:12:49 +0000

"I would love to see Barack Obama be Bulworth." — actor Sean Penn, on Piers Morgan Tonight in Oct. 2011.

On Tuesday night, the New York Times ran a story examining the contrast between President Barack Obama's vision for his second term and the apparent deluge of scandal (and non-scandal) that has swamped the White House for the past weeks. The piece quotes Obama insiders and runs down bullet points for a second-term agenda, but the bit that's gotten the most attention (at least on Twitter and among the Washington news media) is the president's reference to a Warren Beatty political satire:

In private, he has talked longingly of "going Bulworth," a reference to a little-remembered 1998 Warren Beatty movie about a senator who risked it all to say what he really thought. While Mr. Beatty's character had neither the power nor the platform of a president, the metaphor highlights Mr. Obama's desire to be liberated from what he sees as the hindrances on him.

[...]

At the White House Correspondents Association dinner last month, he bristled at the idea that he should be pattern himself after Michael Douglas's assertive character in "The American President." Turning to Mr. Douglas, who was in the audience, he jokingly asked what his secret was. "Could it be that you were an actor in an Aaron Sorkin liberal fantasy?" Mr. Obama asked.

(The irony here is that both films bear the mark of writer Aaron Sorkin. The American President—which Sorkin wrote while high on crack cocaine—is a hilariously optimistic look at liberal politics in America that inspired much of Sorkin's successful NBC series The West Wing. And although Bulworth had three other credited writers—including Beatty—Sorkin served as an uncredited script doctor, and it shows.)

For those unfamiliar with the film, Bulworth is a middle-aged, cynical, and suicidal Democratic lawmaker who is in the pocket of health insurance companies. Shortly after hiring an assassin and putting a hit out on himself, he drunkenly embarks on his reelection campaign with a newfound, smirking nihilism that manifests itself in the form of politically incorrect straight talk about the US health care system, poverty, Newt Gingrich, American intervention in the Middle East, and so on. His political ballsiness quickly earns him a sharp spike in popularity and the privilege to make out with Halle Berry in front of the campaign press corps.

Also, the straight talk often involves Warren Beatty performing original and topical rap music in public, including this "Big Money" song in which he trolls the right by slamming the oil industry and promoting "socialism." Here's an excerpt from the scene:

It's safe to assume that the president did not mean to say that, in the face of recent outrages and pervasive Republican obstructionism, he regularly fantasizes about drunkenly spitting pro-socialist rhymes at high-profile fundraisers. It's merely an expression of the perfectly understandable desire of any American president to (on occasion angrily) tell it like it is, rather than be bound by the decorum of the office. "Probably every president says that from time to time," David Axelrod, a longtime Obama adviser, told the Times. "It's probably cathartic just to say it. But the reality is that while you want to be truthful, you want to be straightforward, you also want to be practical about whatever you're saying."

The pop-cultural reference provoked some snark and mockery from reporters and commentators on the internet. But with the lousy few weeks the White House has been experiencing, it's mildly surprising the president didn't express a private fantasy about "going James Marshall":

GOP Bill To Hogtie Wall Street Watchdog Heads for Vote

Erika Eichelberger — Thu, 16 May 2013 14:20:52 +0000

A bill designed to tie the hands of a key Wall Street regulator is headed for a vote in the House this week.

The SEC Regulatory Accountability Act, introduced by Rep. Scott Garrett (R-N.J.) and co-sponsored by 23 other Republicans, sounds innocuously administrative. The bill would direct the Securities and Exchange Commission (SEC) "to conduct cost-benefit analyses to ensure that the benefits of any rulemaking outweigh the costs," according to a statement by the House Financial Services Committee. Plus, says Garrett, the bill is good for jobs, job-creators, and people who want jobs. "The American people are hungry for common sense reform that will help unleash the economy," he said in a statement. "I regularly hear from constituents, especially job creators, about how Washington red tape needs to be cut."

But financial reform advocates say the bill could kill tons of new regulations designed to rein in the industry that crashed the economy a few years ago. "Cost-benefit has become a favorite club used by industry to try and kill legislation," Dennis Kelleher of the financial reform group Better Markets told me earlier this year. The SEC is in the process of finalizing scores of new rules required by the 2010 Dodd-Frank financial reform law, and reformers say Garrett's bill would force the agency to study the impacts of regulations before they are known, and require analysis that would delay final rules. Not only that, says Kelleher, but the cost-benefit analysis the bill calls for includes only "industry costs," not potential longer term costs to the broader economy that could result from killing these rules. For example, the SEC would have to consider the cost of to industry of making foreign banks adhere to US regulations, but not the cost to the global economy of allowing those banks to be regulated by potentially weaker foreign rules. (Many federal agencies are required to consider cost-benefit analyses when developing major rules, but the SEC and other independent agencies—those outside federal executive departments that are headed by a Cabinet secretary—are exempt.)

The White House slammed Garrett's bill when it was approved by the House rules committee Wednesday, arguing that it would keep the SEC from doing its job. "The Administration believes in the value of cost-benefit analysis," the White House Office of Management and Budget said in a statement. "However, [the bill] would add onerous procedures that would threaten the implementation of key reforms related to financial stability and investor protection." Still, the president stopped short of saying he'd veto the bill.

As my colleague Tim Murphy reported Wednesday, Rep. Louise Slaughter (D-N.Y.), the top Democrat on the House rules committee, attempted to stymie the deregulatory bill by attaching an amendment that would have required political intelligence operatives to register under the Lobbying Disclosure Act and disclose their clients. It was voted down.

Now the GOP bill is headed to the House floor for a vote by Friday. Kelleher has his fingers crossed that the bill doesn't make it into law. "Financial reform does not exist to minimize cost on the industry that almost caused a second great depression," he says.

Tennessee Congressman Slams Holder on Pot Prosecution

Tim Murphy — Thu, 16 May 2013 14:17:45 +0000

Attorney General Eric Holder's appearance before the House Judiciary Committee went exactly like you'd expect. Rep. Darrell Issa (R-Calif.) grilled him on the excessive redaction of emails he'd requested relating to Secretary of Labor-nominee Tom Perez. Rep. Tom Marino (R-Penn.) grilled him on the investigation into leaked intelligence on the Benghazi attack. Rep. Raul Labrador (R-Idaho) grilled him on his failure to recuse himself in writing from said leak investigation. Rep. Louie Gohmert (R-Texas) said some crazy things about asparagus.

But not everyone was as focused on the scandals du jour (or asparagus). In a rare moment of actual congressional outrage over federal sentencing guidelines and drug policy, Rep. Steve Cohen (D-Tenn.) used his allotted five minutes to question the administration's near-total refusal to make use of its pardon power—and its continued prosecution of marijuana offenses. The money quote:

One of the greatest threats to liberty has been the government taking people's liberty for things that people are in favor of. The Pew Research Group shows that 52 percent of Americans think that marijuana should not be illegal. And yet there are people in jail, and your Justice Department continues to put people in jail for sale and use, on occasion, of marijuana. That's something the American public has finally caught up with. It was a cultural lag, and it's been an injustice for 40 years in this country, to take people's liberty for something that was similar to alcohol. You have continued what is allowing the Mexican cartels power, and the power to make money, ruin Mexico, hurt our country, by having a prohibition in the late 20th- and 21st-century. We saw it didn't work in this country in the '20s, we remedied it. This is the time to remedy this prohibition, and I would hope you would do so.

Watch:

Why Won't the Feds Rein In the Firms That Tanked America's Economy?

Erika Eichelberger — Thu, 16 May 2013 02:36:31 +0000

It looks like one of the primary causes of the 2007 financial crash may be here to stay.

Before the crisis, the credit-rating agencies (such as Fitch, Moody's, and Standard & Poor's) that evaluate the relative risk of investment products offered by Wall Street banks, routinely assigned their highest ratings to bonds built out of junky, high-risk mortgages. Because of those ratings, the bad bonds sold like hotcakes, which in turn encouraged lenders to make more high-risk loans to sell to the banks to package into more risky bonds—and so on until the house of cards came down. (For a great read on all of this, see Michael Lewis' "The Big Short.")

Part of the reason the ratings agencies behaved so recklessly is that they were (and still are) paid by the banks whose products they rate. Yet even now, years after the financial crisis, the Securities and Exchange Commission isn't sure what it wants to do, if anything, about this loaded situation. So it held a roundtable discussion on Tuesday to think about it some more.

Credit-rating agencies "effectively took huge bribes from banks to misinform people about risk," says Marcus Stanley, policy director of Americans for Financial Reform. "This is a critical issue and [the SEC] has taken a complete pass on it" so far.

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IRS Head Forced Out After Tea Party Scandal

Gavin Aronsen — Thu, 16 May 2013 00:55:07 +0000

President Barack Obama announced Wednesday that Treasury Secretary Jack Lew has requested and accepted the resignation of acting Internal Revenue Service commissioner Steven Miller in response to news that the agency singled out some conservative organizations for extra scrutiny.

Beginning in March 2010, the IRS targeted groups with words like "tea party" and "patriot" in their names when applying tax laws relating to political activity. There's no evidence other groups got the same level of scrutiny, although according to a investigation by the Treasury Department's inspector general, that was due more to murky campaign finance laws than ideological discrimination.

More MoJo coverage of the IRS tea party scandal

The IRS Tea Party Scandal, Explained

IG Report Says IRS Has No Idea What Its Own Rules Mean

5 Things You Need to Know in the Inspector General's IRS Tea Party Scandal Report

Did the Acting IRS Commissioner Mislead Congress?

Word of the Month for May: BOLO

Ex-IRS Director: Tea Party Groups Deserved Scrutiny, But IRS Bungled the Job

"I will not tolerate this kind of behavior in any agency, but especially in the IRS, given the power that it has and the reach that it has in all of our lives," said Obama, who took heat this week over the IRS affair as well as his administration's handling of the Benghazi attack and the Justice Department's seizure of journalists' phone records.

Miller wasn't at the IRS when the Tea Party targeting happened—Bush appointee Doug Shulman was in charge then. But according to the IRS, Miller failed to alert the Obama administration to the problem when he learn it in May 2012. Miller is scheduled to testify before the House Ways and Means Committee on Friday.

Obama also announced that he had told Treasury Secretary Lew to implement recommendations in the inspector general's report, which doesn't mention Miller's name, and said he will work with Congress "as it performs its oversight role."

Harry Reid: Obama's Pick for Labor Secretary Will Get a Vote Soon

Gavin Aronsen — Wed, 15 May 2013 20:10:18 +0000

Much news has been made of the dozens of judicial slots left vacant due to the constant roadblocks set by Senate Republicans. But Republicans have also blocked or delayed an unprecedented number of cabinet-level presidential nominees during the Obama administration, including most recently labor secretary nominee Thomas Perez, the assistant attorney general for civil rights in the Justice Department, a progressive whose confirmation vote Republicans have repeatedly derailed.

"Now they're double-teaming him," Sen. Majority Leader Harry Reid complained during a Wednesday morning meeting with reporters at the Capitol. "They're holding hearings in the House as to how he's doing in his present job."

House Republicans have scrutinized Perez's alleged role in preventing a St. Paul housing discrimination case from reaching the Supreme Court, and his use of a personal email address to conduct official business. That, Reid said, was done "just to deflect attention from the fact that he's being held up [in the Senate]."

To push back, Senate Democrats plan to force committee votes on three cabinet-level nominees, including Perez. Reid's office expects Perez to be voted out of committee on Thursday, after which Reid plans to schedule a confirmation vote in the near future. Senate Democrats, including Harry Reid, have also floated the possibility of using the nuclear option, which would change Senate rules through a simple majority vote to prevent filibusters on nominees.

The only cabinet-level nominee who has arguably faced harsher resistance from Republicans was former Sen. Chuck Hagel, a Republican himself who was confirmed as secretary of defense in February after facing a filibuster unprecedented for his cabinet position.

Republicans have also been using procedural maneuvers in the Senate to block two other cabinet-level nominees: Obama fundraiser Penny Pritzker as commerce secretary, and Gina McCarthy as head of the Environmental Protection Agency.

Reid also said he planned to schedule a vote soon for Richard Cordray, an uncontroversial lower-level nominee picked to lead the Consumer Financial Protection Bureau. If Republicans block his nomination, Talking Points Memo reports, it could strengthen the case for filibuster reform.

"I'm going to make sure he's going to have a vote next week, and we'll see what happens after that," Reid said of Cordray. "But my point is, this [obstruction] can't go on. This is not good for the country."

Earlier this year, Reid disappointed allies craving real filibuster reform when he declined to pursue major Senate rules changes. He said he has no current plans to take on filibuster reforms, such as one that would weaken Senators' ability to block nominees, but is considering doing so "very closely" as Republicans continue to threaten filibusters against Obama nominees.

"Whether it’s Jeb Bush or Hillary Clinton that’s the next president, I don’t think they should have to go through what we’ve gone through here," Reid said.

Top Dem Trying to Resurrect Political Intel Disclosure Requirement

Tim Murphy — Wed, 15 May 2013 18:40:04 +0000

Rep. Louise Slaughter, the top Democrat on the powerful House rules committee, has a response to Republican efforts to water-down financial reform legislation: Tie it to political intelligence. On Tuesday, with the rules committee set to consider the SEC Regulatory Accountability Act, a GOP bill designed to stunt the Security and Exchange Commission's implementation of the Dodd–Frank financial reform law, Slaughter introduced an amendment that would prevent the law from going into effect unless Congress also passes a law requiring so-called political intelligence operatives to register under the Lobbying Disclosure Act and disclose their clients. Slaughter would also extend revolving-door statutes to government employees who join the private sector, mandating a cooling-off period of varying length before they can begin working as a political intelligence operative.

Political intelligence is a roughly $400-million-a-year industry which collects information on Congressional and regulatory wheeling and dealing, and passes it on to clients on Wall Street. Political intel operatives insist they come in peace, and that their work at its most basic level is a lot like that done by journalists—albeit for much smaller audiences. The counterpoint from disclosure advocates is this story from the Wall Street Journal, which describes how a hedge fund gained early access to a decision by the Centers for Medicare and Medicaid Services and triggered a spike in the stock prices of health insurers. The SEC launched an investigation into the case in April.

Slaughter first floated regulation of political intelligence in 2006, and nearly pushed it through last year before a fierce push-back from hedge fund lobbyists slammed the door. Her amendment isn't expected to pass, but it's a preview of what Slaughter and Sen. Chuck Grassley (R-Iowa) are hoping to unveil in a few months, after the SEC finishes its probe.

Here's the amendment:

Update: Slaughter's amendment was blocked. Here's the relevant exchange:

Corn on MSNBC: It's Insulting To Watergate to Compare Anything to Watergate

Wed, 15 May 2013 17:32:09 +0000

The spate of investigations in Washington this week is great fodder for GOP members, who have repeatedly compared the scandals to Watergate. DC Bureau Chief David Corn doesn't think it's a fair comparison: "It's insulting to Watergate to compare anything to Watergate!" he says. Watch him discuss the Watergate analogy with Salon's Joan Walsh and host Al Sharpton on MSNBC's PoliticsNation:

David Corn is Mother Jones' Washington bureau chief. For more of his stories, click here. He's also on Twitter.

The Obama Administration Has a Long Record of Prosecuting Leakers

Thomas Stackpole — Wed, 15 May 2013 17:17:50 +0000

The Associated Press announced on Monday that federal agents had secretly seized two months of its phone records in what the organization called a "serious interference with the A.P.’s constitutional rights to gather and report news." Although much of the resulting furor has focused on the rights of a free press, the sweeping move by the Department of Justice also highlights the Obama administration's rough treatment of leakers and whistleblowers within its ranks.

The Obama administration has used the 1917 Espionage Act, which was originally designed to prosecute spies, to indict twice as many government officials for leaks than all other administrations combined. The Knight Center for Journalism in the Americas has assembled a list of the six current and former government officials that the Obama administration has indicted under the law:

1. Shamai K. Leibowitz, 2009

Leibowitz, a former-FBI Hebrew translator, pleaded guilty to leaking classified information to Richard Silverstein who blogs at Tikun Olam, reported AlterNet. The translator passed 200 pages of transcribed conversations recorded by FBI wiretaps of the Israeli embassy in Washington, D.C. Leibowitz was sentenced to up to 20 months in prison, according to The Washington Post.

2. Stephen Jin-Woo Kim, 2010

Kim was a nuclear proliferation expert working on a contract basis for the U.S. State Department when he was accused of leaking information about North Korea to Fox News.

The Justice Department claimed that Kim was the source behind Fox News journalist James Rosen’s 2009 report suggesting that the North would likely test another nuclear bomb in reaction to a United Nations Security Council resolution condemning its tests, reported AlterNet.

Kim pleaded not guilty to the charges. A Federal Grand Jury indicted him but the case has not gone to trial, according to The New York Times.

3. Thomas Drake, 2010

Drake worked as a senior executive at the National Security Agency when he was charged with “willful retention” of classified documents under the Espionage Act. He leaked information about government waste on digital data gathering technology to The Baltimore Sun, according to AlterNet.

At one point Drake faced up to 35 years in prison for several charges. Eventually, most of the charges were dropped and he pleaded guilty to a misdemeanor for “exceeding authorized use of a computer.” He was sentenced to one-year probation and community service.

4. Pfc. Bradley Manning, 2010

Probably the best known of the six under indictment, Manning was the source behind the WikiLeaks and CableGate information dumps. Critics accuse the government of dragging its feet and aggressively redacting requests for public information about the trial. One journalist opined that the Guantanamo military tribunals were more transparent.

Manning faces a court martial and a harsher sentence that could include life in prison without parole, reported The New York Times. AlterNet pointed out, however, that prosecutors would have to prove Manning released the documents with the intention of harming the U.S. to win those harsher charges, something Manning denies. His trial is set for next month, June 3.

5. Jeffery Sterling, 2010

Sterling, a former-CIA official, pleaded not guilty to leaking information to New York Times journalist James Risen regarding a failed U.S. attempt to sabotage Iran’s nuclear program. The information in question was published in Risen’s book “State of War.”

Risen successfully fought several subpoenas from the federal government to reveal his sources during Sterling’s trial, according to the Committee to Protect Journalists. The Justice Department announced in the summer of 2012 that it has “effectively terminated” the case, according to the Times.

6. John C. Kiriakou, 2012

One of the few prosecuted under the Espionage act to serve jail time, Kiriakou was sentenced to 30 months in prison on Jan. 25, 2013, for leaking classified information to the media. Kiriakou pleaded not guilty to releasing the name of an undercover CIA agent to a reporter and information about the intelligence agency’s use of waterboarding, a controversial interrogation technique.

Kiriakou is the first person successfully prosecuted under the Intelligence Identities Protection Act in 27 years, according to the Times. The reporter the ex-CIA official spoke to did not publish the undercover agent’s name, although the Times pointed out that the agent’s identity appeared in a sealed legal filing and on an “obscure” website.

Ex-IRS Director: Tea Party Groups Deserved Scrutiny, But IRS Bungled the Job

Andy Kroll — Wed, 15 May 2013 10:00:08 +0000

Among those in attendance last Friday when IRS official Lois Lerner admitted that agency staffers had systematically singled out tea partiers and other conservative groups for special scrutiny was a lawyer named Marcus Owens. Lerner's admission was shocking, and nobody realized that more than Owens. That's because he served as director of the Exempt Organizations Division from 1990 to 2000, prior to Lerner holding the job.

More MoJo coverage of the IRS tea party scandal

The IRS Tea Party Scandal, Explained

IG Report Says IRS Has No Idea What Its Own Rules Mean

5 Things You Need to Know in the Inspector General's IRS Tea Party Scandal Report

Did the Acting IRS Commissioner Mislead Congress?

Word of the Month for May: BOLO

Ex-IRS Director: Tea Party Groups Deserved Scrutiny, But IRS Bungled the Job

Owens, who has worked on tax law issues in private and public practice for almost 40 years, including 25 years at the IRS, says he has been getting a lot of calls about the scandal. The way he sees it, he told me in an interview on Tuesday, is that the IRS was right to take a close look at conservative groups applying for tax-exempt status during the 2010 and 2012 election cycles. Particularly in 2010, hundreds of new conservative groups were springing up across the country. "I think that it would be unreasonable to expect the IRS to ignore that, and to simply approve these 501(c)(4) applications from politically active organizations as if they were Scout troops or Little Leagues," he said. "That doesn't mean they should be denied exemption or that the evaluation should be overboard or overly intrusive, but there should be special evaluation."

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Could Federal Seizure Be the Beginning of the End for Bitcoin?

Josh Harkinson — Wed, 15 May 2013 00:03:36 +0000

In what may be the first move toward a federal shutdown of the wildly popular online currency known as Bitcoin, the Department of Homeland Security today issued an order that has restricted the transfer of funds in and out of Mt. Gox, the Bitcoin exchange that handles some 60 percent of the transactions.

A creation of bank-fearing techies, Bitcoins are now worth more than $1 billion, and consumer interest has been skyrocketing. For more background, read our Bitcoin explainer.

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Elizabeth Warren to Obama Administration: Take the Banks to Court, Already!

Erika Eichelberger — Tue, 14 May 2013 23:34:46 +0000

On Tuesday, fierce consumer advocate and needler of banks Sen. Elizabeth Warren (D-Mass.) called out Wall Street regulators for their habit of giving tepid punishments to misbehaving banks, and asked the agencies to justify their policy of settling with the wrongdoers out of court.

Warren sent a letter to the Justice Department, as well as to the Securities and Exchange Commission and the Federal Reserve, asking them for evidence on how a settlement that doesn't require a bank to admit guilt would be better policy than taking the bad apple to trial. If regulators at least show that they are willing to play tough, she argued, it will help deter bad behavior and allow regulators to negotiate bigger fines in the event of a later settlement.

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Why "Feticide" Charges Are More Complicated Than They Seem

Kate Sheppard — Tue, 14 May 2013 21:38:28 +0000

Prosecutors in Ohio have indicated that they will seek murder charges against Ariel Castro, the man they believe kidnapped, tortured, and imprisoned three women in his house for roughly a decade. The murder charges stem from reports that he raped, impregnated and abused one of the women, Michelle Knight, causing her to miscarry multiple pregnancies.

"I fully intend to seek charges for each and every act of sexual violence, rape, each day of kidnapping, every felonious assault, and each act of aggravated murder for terminating pregnancies that the offender perpetrated," Cuyahoga County Prosecutor Timothy McGinty said at a news conference late last week. Ohio prosecutors are assessing whether they could seek the death penalty against Castro.

Thirty-eight states have laws on the books that make killing a fetus in a violent act a separate crime from the harm done to the pregnant woman, according to the National Conference of State Legislatures. Ohio has had a feticide law since 1996. Although there is broad agreement on the idea that Castro should be prosecuted for his alleged crimes, the use of this type of "feticide" law makes some in the world of reproductive rights and law nervous, since these laws move toward the kind of "fetal personhood" measures that anti-abortion groups have tried to push to define a fetus as a full and separate human being.

"What Castro is accused of doing is so horrendous it defies comprehension. He allegedly forced Ms. Knight to become pregnant, and then forced her to miscarry—nobody disagrees that he should be punished for this," Farah Diaz-Tello, a staff attorney at National Advocates for Pregnant Women, told Mother Jones. "But when the law treats fertilized eggs, embryos, and fetuses as legally separate from the pregnant women who carry them, the door is open to a host of problematic consequences for pregnant women."

The concern is that this sort of law could in turn be used to prosecute women for seeking an abortion or other potential or perceived harms to a fetus. And as I've reported here before, women already have been prosecuted under this type of law in some states.

Lindsey Beyerstein has a great piece at RH Reality Check looking at the legal issues at hand in the case. Michelle Goldberg also makes an elegant argument against the murder charge at The Daily Beast:

But if he is convicted of capital murder, it will ultimately be an injustice—not to him, but to the rest of us. That's because it will mean that legally, ending a pregnancy is a greater crime than keeping three human beings locked in a squalid dungeon for a decade. Such a precedent will have implications beyond this terrible case.

Emily Bazelon made a similar point about this over at Slate. As Diaz-Tello puts it, "The acts of torture Castro allegedly committed against these three women are certainly more than enough to put him away for life without going down roads that lead to locking up pregnant women."

Attorney General Eric Holder Orders Investigation of IRS

Gavin Aronsen — Tue, 14 May 2013 20:27:03 +0000

At a Tuesday press conference, Attorney General Eric Holder announced that he had ordered the Justice Department and FBI to investigate whether the Internal Revenue Service violated the law by subjecting tea party groups applying for tax-exempt nonprofit status to special scrutiny. Other dark money organizations that have drawn criticism from advocates of campaign finance reform, including the pro-Obama Priorities USA and Karl Rove's Crossroads GPS, have received little attention from the IRS.

The controversy, which was first reported on Friday, is the latest in a long line of alleged IRS witch hunts against specific political and religious organizations.

The New York Times reports:

The activities of I.R.S. officials are already the subject of an investigation by the agency's inspector general. The results of that inquiry, which are expected in the next several days, are likely to detail how officials at the agency selected political groups for extra scrutiny about their tax status.

...

The attorney general said there were "a variety of statutes within the I.R.S. code" that could be the basis of a criminal violation. He said officials conducting the investigation would also look at "other things in Title 18" of the United States Code. Title 18 is the overall criminal code for the federal government.

During a concurrent press conference, White House press secretary Jay Carney said that "if the reports about the activity of IRS personnel prove to be true," President Barack Obama "would find them outrageous, and he would expect that appropriate action be taken, and that people be held responsible. He has no tolerance for targeting of specific groups."

Did the Acting IRS Commissioner Mislead Congress?

Andy Kroll — Tue, 14 May 2013 17:50:15 +0000

When Lois Lerner, a top IRS official, revealed last Friday that agency staffers had singled out conservative nonprofit groups for extra scrutiny over their potential political activities, she blamed low-level, "frontline" staffers in the agency's Cincinnati office, a hub of activity that handles tens of thousands of applications for tax-exempt status. The IRS later said no high-level officials were aware of these controversial actions.

More MoJo coverage of the IRS tea party scandal

The IRS Tea Party Scandal, Explained

IG Report Says IRS Has No Idea What Its Own Rules Mean

5 Things You Need to Know in the Inspector General's IRS Tea Party Scandal Report

Did the Acting IRS Commissioner Mislead Congress?

Word of the Month for May: BOLO

Ex-IRS Director: Tea Party Groups Deserved Scrutiny, But IRS Bungled the Job

As it turns out, the current acting IRS commissioner knew that staffers were flagging applications from certain conservative groups a year before Congress and the public found out about it. And members of Congress are steaming mad that the IRS was aware of the questionable practices of some of its staffers and didn't speak up about it. Several Republicans claim that Congress was misled by the IRS and its top brass about these actions.

The IRS said that current acting commissioner Steven Miller learned on May 3, 2012, that staffers had been picking out conservative groups for greater scrutiny than is typical. (Miller was deputy commissioner at the time.)

Yet Republican lawmakers say Miller neglected to tell Congress about the systematic singling out of conservative groups in subsequent interactions. Miller wrote two letters to Congress after his May 2012 briefing about how the IRS reviews applications for tax-exempt status, but did not mention the scrutiny of tea party groups. On July 25, 2012, Miller testified before the House ways and means oversight subcommittee on the subject of "organizational and compliance issues related to public charities." During questioning, Miller was asked about tea party groups being harassed, but not about tea partiers specifically. He did not mention having been briefed on the IRS' actions.

"It is almost inconceivable to imagine that top officials at the IRS knew conservative groups were being targeted but chose to willfully mislead the Committee's investigation into this practice," Rep. Dave Camp, chair of the ways and means committee, said in a statement.

An IRS spokesman did not respond to a request for comment.

Miller wrote in an op-ed for USA Today on Tuesday that the IRS' singling out of conservative groups showed "a lack of sensitivity to the implications of some of the decisions that were made." He added that sifting through applications for tax-exempt status was "factually complex, and it's challenging to separate out political issues from those involving education or social welfare." He did not say why he didn't tell Congress about the tea party scrutiny when he learned of it in May 2012.

Other lawmakers say they corresponded with the IRS on the tea party issue and can't understand why the agency didn't share all of what it knew. "I wrote to the IRS three times last year after hearing concerns that conservative groups were being targeted," Sen. Orrin Hatch (R-Utah), said in a statement Monday. "Yet it didn't occur to anyone at the IRS to let us know that this targeting was in fact happening? Knowing what we know now, the IRS was at best being far from forthcoming, or at worst, being deliberately dishonest with Congress. These are the facts and the questions we need answered."

They could be answered soon. On Friday, the House ways and means committee will hold a hearing on the IRS' tea party controversy. Other House and Senate committees have pledged to investigate the matter, too.

Minn. Passes Gay Marriage and Michele Bachmann Is Sad

Tim Murphy — Tue, 14 May 2013 15:37:30 +0000

At 5 p.m. CST on Tuesday, Minnesota will become the 12th state to legalize same-sex marriage when Gov. Mark Dayton (D) signs into law legislation that just passed the state Senate on Monday. It's a remarkable turn of events for a state where conservatives spent much of the last decade trying to pass a Constitutional amendment to put marriage equality out of reach. (A referendum narrowly failed last November.)

This is bad news for the politician who, perhaps more than anyone else in the state, has built her career on denying full rights to same-sex couples—Rep. Michele Bachmann (R-Minn.). Bachmann's influence in her home state has been fading since her GOP presidential bid failed spectacularly in 2011. In a solidly conservative district, she squeaked past her Democratic challenger last fall by just 4,300 votes, and is now in the crosshairs of the Office of Congressional Ethics over charges that she improperly used campaign funds to promote her memoir. What political currency she has left may as well be in Bitcoin. Here's how she responded to the vote on Monday:

I’m proud to have introduced the original traditional marriage amendment, and I thank all Minnesotans who have worked so hard on this issue.
— Michele Bachmann (@MicheleBachmann) May 13, 2013

No kidding. As I explained in a profile for the magazine two years ago, Bachmann opposed marriage equality with a religious fervor, viewing it as a struggle for the future of society. At one point she even enlisted divine intervention on a gay colleague, Sen. Scott Dibble:

In two consecutive legislative sessions, Bachmann introduced bills to place a gay marriage ban on the ballot. Openly gay Democratic state Sen. Scott Dibble says that when he wasn't there she brought a group of conservative activists—"prayer warriors," as she called them—into the chamber to pray over his desk. She held a candlelight vigil outside the Capitol to pray for the legislation's passage and, with the Legislature scrambling to finish up its session in the spring of 2004, brought the body to a standstill through her efforts to bring the bill to the floor.

Dayton's signature will mark the end of an era in Minnesota politics. On Monday, as the Senate at last voted for marriage equality, Dibble blew a kiss to his husband in the gallery. He may as well have been bidding Bachmann farewell.

Brian Mark Peterson/Minneapolis Star Tribune/ZumaPress.com

Sen. John Cornyn Takes a Stand Against Migrant Deaths. Sort Of.

Tim Murphy — Tue, 14 May 2013 15:02:42 +0000

On Monday, Sen. John Cornyn (R-Texas) published an op-ed on Fox News detailing his recent travels in the Rio Grande Valley, where he met an undocumented immigrant from El Salvador and visited a cemetery that houses the remains of unidentified migrants who died traversing the county's scorching canyons. "As a policymaker, I have a responsibility to find real solutions to these issues that are all-too-familiar to Texans," he writes. "Anything less only perpetuates this grotesque human tragedy playing out every day on American soil." So far so good. He also released this video, which documents his trip to the cemetery with a close-up on the details (or lack thereof) on the unmarked graves:

At this point you might think that Cornyn is taking a lead role in combating the surge in migrant deaths in South Texas. But that's where things get weird.

Cornyn's video points to the increasing number of migrant deaths in Brooks County as evidence that the border isn't really secure. That's really the opposite of what's happening. Rising migrant death totals aren't a symptom of a porous border; they're a symptom of a border that's increasingly locked-down, and a testament to more effective enforcement policies in traditional migrant corridors—a point that's made in the Washington Post story Cornyn cited in the video. The idea that tougher border security makes border crossings more dangerous is well-established (this 2009 report from the American Civil Liberties Union is instructive, as is this from the American Public Health Association). Contra Cornyn's assertion in the video, Brooks County is what a secure border looks like. That's why Coalición Derechos Humanos Arizona, which works with migrants in the Sonora desert, doesn't support the enforcement-heavy bill currently being considered in the Senate.

Cornyn did vote for a successful amendment to the Senate legislation to mandate better data collection of human trafficking, inspired by this specific case in Houston. But he's pushing for a harsher security policy that would exacerbate the problems Brooks County already faces—citing, among other things, the presence of men "wearing some form of turban" crossing into South Texas. (Cornyn has introduced his own legislation focusing exclusively on border security, which he'd like to see as a prerequisite for any kind of immigration reform.) During the committee markup, Cornyn broached the subject of Brooks County's rising toll, but only to push for reimbursement for the county. On Thursday, he voted for a proposal from Sen. Jeff Sessions (R-Ala.) that would modify the Senate immigration reform bill to "strike the section that requires the Secretary of Homeland Security to issue policies governing the use of force by Department of Homeland Security personnel."

Boehner and the Benghazi Emails: Been There, Done That?

David Corn — Mon, 13 May 2013 14:55:35 +0000

House Speaker John Boehner, according to Politico, is obsessed with Benghazi. And last week, after ABC News revealed the revised talking points crafted by the Obama administration following the September 11 attack that left four Americans dead, Boehner demanded that the administration release emails related to these talking points. "The truth shouldn't be hidden from the American people behind a White House firewall," Boehner declared. "Four Americans lost their lives in this terrorist attack. Congress will continue to investigate this issue, using all of the resources at our disposal." But thanks, in part, to the Republicans, the truth isn't being hidden. Boehner and his fellow Republicans had access to those emails—and used them for a public report they issued weeks ago that scooped the ABC News story.

In March, Boehner, according to a senior administration official, was invited to a White House-arranged briefing where the emails and other Benghazi-related material could be privately reviewed. Boehner did not attend; he sent staff, who attended with other House Republicans. Asked why Boehner did not participate in this session and why he did not at that time demand the release of the emails, Brendan Buck, his press secretary, says, "This is embarrassing pushback. Do you recall the report we put out in April? The committees were compiling information as part of their investigation and when the report was done, the committees requested the release of the emails." In an April 23 letter, five GOP House committee chairs did ask the White House to turn over to their committees the documents it had allowed the GOPers to review.

Continue Reading »

Electric Car Guru Elon Musk Ditches Mark Zuckerberg's FWD.us Group

Andy Kroll — Mon, 13 May 2013 14:31:53 +0000

Elon Musk, the CEO of Tesla Motors and the private space travel company SpaceX, has parted ways with FWD.us, the tech-centric political group that Facebook cofounder Mark Zuckerberg launched last month. So, too, has investor and entrepreneur David Sacks, who created the social network Yammer and financed the satiric 2005 movie Thank You for Smoking. The tech news website AllThingsD first reported the departures of Musk and Sacks, and their names have been removed from the list of nearly two-dozen "major contributors" to FWD.us.

Zuckerberg and Facebook "Causes" creator Joe Green founded FWD.us to lobby on behalf of Silicon Valley firms in Washington. They quickly earned the endorsements of a host of other tech superstars. The group—which, as a 501(c)(4) nonprofit, does not have to disclose its donors—has reportedly raised more than $25 million so far. The group chose the ongoing fight over comprehensive immigration reform as its first foray into Congressional politics, seeking to expand the number of visas available to engineers and other high-skilled workers that tech companies would like to recruit. By all accounts, FWD.us' message has gotten a warm reception on Capitol Hill.

But the group caused a political firestorm recently when it ran TV advertisements praising Sen. Mark Begich (D-Alaska) for supporting more oil drilling in the Arctic National Wildlife Reserve. Another ad depicted Sen. Lindsey Graham (R-S.C.) criticizing Obamacare and President Obama's refusal (so far) to green-light the controversial Keystone XL pipeline. FWD.us ran the ads to give Begich and Graham some political cover on immigration reform, the theory being that by touting the senators' conservative bona fides, they could give them the space to take a moderate position on an immigration reform bill. The Begich and Graham ads ran for a week and are no longer on the air. Liberal and environmental groups reacted furiously to FWD.us' conservative and anti-environmental message, protesting at Facebook's headquarters in Menlo Park, California. And last week, nine progressive groups, including MoveOn.org, Progressives United, the Sierra Club, and Daily Kos, pledged to pull down their existing paid Facebook ads or cancel future ad buys for at least two weeks.

It's not surprising that Musk would break with FWD.us. Tesla Motors builds high-end electric cars; its entire business model is built around a clean-tech economy. Musk also sits on the board of SolarCity, a company that delivers, installs, and maintains solar panels powering homes, businesses, and government offices.

Musk sent this statement to AllThingsD: "I agreed to support Fwd.us because there is a genuine need to reform immigration. However, this should not be done at the expense of other important causes. I have spent a lot of time fighting far larger lobbying organizations in DC and believe that the right way to win on a cause is to argue the merits of that cause. This statement may surprise some people, but my experience is that most (not all) politicians and their staffs want to do the right thing and eventually do."

FWD.us spokeswoman Kate Hansen emailed this statement to Mother Jones: "We recognize that not everyone will always agree with or be pleased by our strategy—and we're grateful for the continued support of our dedicated founders and major contributors. FWD.us remains totally committed to supporting a bipartisan policy agenda that will boost the knowledge economy, including comprehensive immigration reform."

Val Kilmer Was in DC This Week Lobbying for What?!

Asawin Suebsaeng — Fri, 10 May 2013 23:52:53 +0000

Val Kilmer is a part-time Washington lobbyist now.

Earlier this week, the film and stage actor (Batman Forever, Top Gun, The Doors, MacGruber) was on Capitol Hill advocating for the Equitable Access to Care and Health Act, which would expand Americans' ability to claim religious exemptions to Obamacare's health insurance mandate. Kilmer alerted the world to his latest foray into political advocacy with a series of tweets, which included a photo taken at the Hart Senate Office Building.

In the bowels of government WASHINGTON DC twitter.com/ValEKilmer/sta…
— Val Kilmer (@ValEKilmer) May 8, 2013

A day lobbying for health care exemption on the hill. The EACH ACT (bill #1814). twitter.com/ValEKilmer/sta…
— Val Kilmer (@ValEKilmer) May 8, 2013

New hair do for my new job as lobbyist twitter.com/ValEKilmer/sta…
— Val Kilmer (@ValEKilmer) May 9, 2013

The description of "lobbyist" here should not be taken literally; a search on the House lobbying disclosure webpage does not yield Kilmer's name.

The EACH Act is sponsored by Rep. Aaron Schock (R-Ill.), best known for getting his six-pack abs splashed on the cover of Men's Health. Under the EACH Act, Americans can avoid the insurance mandate if they file an affidavit stating that their religious faith bars them from buying insurance. Various religious groups have fiercely opposed the law, and Obamacare already includes a "religious conscience exemption."

Kilmer did not respond to requests for comment and it's not known whom he met with (he reportedly had dinner with Democratic Senator Kirsten Gillibrand of New York). "We have no idea why he was at the Hill; we have nothing to do with that part of his life," a representative for the actor said. "He doesn't have a publicist now, and he doesn't really do interviews."

Kilmer's visit is likely linked to his religious faith; he is a committed Christian Scientist. "It is quite a challenging faith," he told Esquire in 2005. Certain Christian Scientists' beliefs about health care, particularly their denial of modern medical care to children, are controversial, to say the least.

This isn't the 53-year-old actor first brush with politics. A few years ago, Kilmer considered making a run for governor of New Mexico, consulting with strategists and politicos; then-New Mexico governor Bill Richardson said he liked Kilmer's prospects partly because "he was Batman." He has engaged in some environmental activism and supported Ralph Nader in the 2008 presidential election. In 2010, Kilmer teamed up with the ACLU to win the right to convert his ranch near Santa Fe into a posh bed-and-breakfast.

It's hard to say if Val Kilmer will continue his public charge for Obamacare religious exemptions. As for merging elements of his faith and profession, it's still a work in progress: For more than a decade Kilmer has been working on a "tragicomic" film about Mark Twain—and Christian Science church founder Mary Baker Eddy.