Skip to comments.Insider deals taint Senate
Posted on 02/23/2012 5:49:52 PM PST by Graybeard58
A new report by the University of Illinois at Chicago concludes, based on conviction rates since the 1970s, Chicago is America's most corrupt city and Illinois its third most corrupt state. Among our initial reaction: Another taxpayer-funded study belabors the obvious.
"What has come to be called 'The Chicago Way' or 'The Illinois Way' of public corruption has undermined ... voters' sense of political efficacy," the authors wrote. "Why report corrupt officials if you know they won't be punished and they may turn the powers of the government on you?" A good question. But the fear of reprisal finishes a distant second to abetting corruption of officials by legalizing their illicit acts. Examples abound, but one of the best was detailed in a recent Wall Street Journal article about the close ties between hedge funds and members of Congress, specifically Sen. Joseph Lieberman, I-Conn., and former Connecticut Sen. Christopher Dodd, D-Hollywood.
Already notorious for pushing federal bailouts for his Wall Street funders, scoring sweetheart mortgages and steering tax dollars to bonuses for his sugar daddies at AIG, then-Sen. Dodd had a number of private meetings in 2009 and 2010 with hedge-fund managers to keep them apprised of the progress of the Dodd-Frank legislation. On Jan. 28, 2010, the Journal reported, he told them the bill overhauling financial-industry regulations would not include caps on fees credit-card companies could collect on debit-card purchases. Conatus Capital Management then added more than 300,000 shares of Visa to its portfolio, and by April, it was sitting on a $14 million profit.
Mr. Dodd would deny his insider information was payback for the $6.3 million the securities industry donated to his campaigns over the years. But that and other quid pro quos that enriched him and funded his re-elections are allowed under federal laws and ethics rules.
The insider trading involving Sen. Lieberman occurred while Congress was ramming Obamacare down America's throat. He was the crucial 60th vote the Democrats needed to end a Republican filibuster in 2009. As negotiations neared a resolution, the Journal reported, Sen. Lieberman and others hosted a meeting Dec. 8, 2009, at the Capitol with JNK Securities and its hedge-fund clients. "The broad outlines of an agreement had been circulating for days, but the lawmakers confirmed they were close to a deal that discarded the public insurance plan, a boost to private insurers."
Actually, Democrats had every reason to believe he would vote for the so-called public option and reacted angrily when he flip-flopped days after he met with the hedge funds. "Mr. Lieberman's threat to block the bill blew up a proposed deal among the Democratic caucus," The New York Times reported at the time.
What he did was to tip off the hedge funds that Obamacare with the public option was dead. Two of the funds represented at the meeting eventually accumulated 6.5 million shares of Aetna; its stock price is up 48 percent since that meeting. By the way, investment firms contributed $4 million to Sen. Lieberman's campaigns over the years, with more than half coming in the most recent election cycle, according to federal data compiled by the Center for Public Integrity.
"Voters may laugh at times at the antics of public officials," the UI-Chicago report observed, "but in the end, they feel powerless, lose their faith in government and vote less often because they believe the 'fix is in.'" Well, the fix is in because they keep re-electing corrupt politicians more interested in re-election and personal enrichment than public service.
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“...A new report concludes Chicago is America’s most corrupt city...”
I don’t know how much was spent for the study, but I could have told them that for free.
Perhaps what Dodd did was not a violation (although I suspect that's a cop-out), but surely what Conatus did is prosecutable.
Chicago is an organized criminal enterprise. They ought to build a wall around it and add guard towers, because it would be much cheaper and quicker than trying them all.
Nothing wrong with Chicago and Springfield that 7 megatons (each) wouldn’t cure.