AlterNet: Amy Goodman: How Two Former PA Judges Got Millions in Kickbacks to Send Juveniles to Private Prisons

By Amy Goodman, Democracy Now!

http://www.alternet.org/story/127461/

Amy Goodman: An unprecedented case of judicial corruption is unfolding in Pennsylvania. Several hundred families have filed a class-action lawsuit against two former judges who have pleaded guilty to taking bribes in return for placing youths in privately owned jails. Judges Mark Ciavarella and Michael Conahan are said to have received $2.6 million for ensuring that juvenile suspects were jailed in prisons operated by the companies Pennsylvania Child Care and a sister company, Western Pennsylvania Child Care. Some of the young people were jailed over the objections of their probation officers. An estimated 5,000 juveniles have been sentenced by Ciavarella since the scheme started in 2002.

In addition to the jailing of the youths, the judges also admitted to helping "facilitate" the construction of private jails. The U.S. attorney for the Middle District of Pennsylvania, Martin Carlson, unveiled the charges last month.

Martin Carlson: These payments were made to the judges, it is alleged, in return for discretionary acts by the judges favoring these businesses, acts relating to the construction, expansion, operation of these juvenile facilities and acts relating to the placement of juveniles in these facilities.

Amy Goodman: On Thursday, Judges Ciavarella and Conahan entered guilty pleas on charges of wire fraud and income tax fraud. They're currently free on a $1 million bail bond pending sentencing. Their plea agreements call for jail sentences of more than seven years. No charges have been filed against the private prisons that paid the bribes.

Pennsylvania's Supreme Court has appointed an outside judge to review all the cases tried by Ciavarella and Conahan. But the case has prompted calls for broader reforms of the juvenile justice system in Pennsylvania and nationwide.

We're joined now by two of the thousands of youths jailed by the corrupt judges. On the line with us from Scranton, Pennsylvania, eighteen-year-old Jamie Quinn is with us. She spent more than eleven months in a privately run juvenile prison camp after being sentenced by Judge Mark Ciavarella as a first-time offender. Also on the line in the nearby town of Wilkes-Barre is twenty-two-year-old Kurt Kruger. Another first-time offender, he spent more than four months in a privately run prison--juvenile prison camp after also being sentenced by Judge Ciavarella.

And joining us in a studio in Philadelphia is Bob Schwartz. He is a co-founder and executive director of the Juvenile Law Center, which helped expose the corrupt judges and is now involved in the class-action suit brought on behalf of the jailed youths' families.

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AlterNet: HuffPo Breaks Huge Corruption Story and Now We Must Do Something About It

By Lawrence Lessig, Huffington Post
http://www.alternet.org/bloggers/http://www.huffingtonpost.com//124151/

You can't make this stuff up. Breaking news from The Huffington Post:

Three days after receiving $25 billion in federal bailout funds, Bank of America Corp. hosted a conference call with conservative activists and business officials to organize opposition to the U.S. labor community's top legislative priority.

Participants on the October 17 call -- including at least one representative from another bailout recipient, AIG -- were urged to persuade their clients to send "large contributions" to groups working against the Employee Free Choice Act (EFCA), as well as to vulnerable Senate Republicans, who could help block passage of the bill.

...Donations of hundreds of thousands, if not millions, of dollars to Republican senatorial campaigns were needed, they argued..."If a retailer has not gotten involved in this, if he has not spent money on this election, if he has not sent money to [former Sen.] Norm Coleman and all these other guys, they should be shot. They should be thrown out their goddamn jobs," Marcus declared.

Not only are some of the most non-trusted companies in America blatantly trying to buy off Congress, but they're using our bailout money to do it. Enough!

If there was ever a time to join Change Congress's political "donor strike" in support of fundamental campaign finance reform, this is it.

Click here to join the fight for reform.

Together, thousands of us have pledged not to donate a penny more to politicians unless they support "citizen-funded elections" for Congress -- a combination of public financing plus Obama-style small-dollar donations. We have removed $431,000 from the campaign coffers of those who oppose reform, and it's growing by the hour.

Instead of politicians spending their time begging those who got us into this economic crisis for big-dollar checks, politicians will have to spend their time being responsive to regular people. That's the way democracy should work. And now, at this moment of outrageous news, all of us can do our part. Please join the fight for reform today by clicking here, and then forward this news to some friends today.

Thanks for changing Congress,
Lawrence Lessig & Joe Trippi (co-founders, Change Congress)

UPDATE: A commenter at DailyKos smartly said we should Digg and Reddit this. Please do!

© 2009 Huffington Post All rights reserved.
View this story online at: http://www.alternet.org/bloggers/http://www.huffingtonpost.com//124151/

AlterNet: Rove's IT Guru Warned of Sabotage Before Fatal Plane Crash; Was Set to Testify

By Amy Goodman, Democracy Now!

http://www.alternet.org/story/114674/

Amy Goodman: A top Republican internet strategist who was set to testify in a case alleging election tampering in 2004 in Ohio has died in a plane crash. Mike Connell was the chief IT consultant to Karl Rove and created websites for the Bush and McCain electoral campaigns. He also set up the official Ohio state election website reporting the 2004 presidential election returns.

Connell was reportedly an experienced pilot. He died instantly Friday night when his private plane crashed in a residential neighborhood near Akron, Ohio.

Michael Connell was deposed one day before the election this year by attorneys Cliff Arnebeck and Bob Fitrakis about his actions during the 2004 vote count and his access to Karl Rove's e-mail files and how they went missing.

Velvet Revolution, a non-profit investigating Connell's activities, revealed this weekend that Connell had recently said he was afraid George Bush and Dick Cheney would "throw [him] under the bus." Cliff Arnebeck had also previously alerted Attorney General Michael Mukasey to alleged threats from Karl Rove to Connell if he refused to "take the fall."

Well, Mark Crispin Miller joins us now, a professor of media culture and communication at New York University, the author of several books, including Loser Take All: Election Fraud and the Subversion of Democracy, 2000-2008 and Fooled Again: How the Right Stole the 2004 Election & Why They'll Steal the Next One Too. Mark Crispin Miller us now in our firehouse studio.

Welcome to Democracy Now!

Mark Crispin Miller: It's good to be here, Amy. Thank you.

AG: Alright, well, we had you on right before the election, because that's when Mike Connell was being deposed. This news that came out of his death in a plane crash on Friday night, talk about what you understand has happened.

MCM: Well, I cannot assert with perfect confidence that this was no accident, but I will say that the circumstances are so suspicious and so convenient for Rove and the White House that I think we're obliged to investigate this thing very, very thoroughly. And that means, first of all, taking a close look at some of the stories that were immediately circulated to account for what happened, that it was bad weather. That was the line they used when Wellstone's plane went down. There had been bad weather, but it had passed two hours before. And this comes from a woman at the airport information desk in Akron. We're told that his plane was running out of gas, which is a little bit odd for a highly experienced pilot like Connell, but apparently, when the plane went down, there was an explosion, a fireball that actually charred and pocked some of the house fronts in the neighborhood. People can go online and see the footage that news crews took. But beyond the, you know, dubiousness of the official story, we have to take a close look at -- and a serious look at all the charges that Connell was set to make.

AG: Now, he had asked the Attorney General Mukasey for protective custody, because of threats to him and his wife?

MCM: He reported threats to his lawyer, Cliff Arnebeck, and Arnebeck -- also, Velvet Revolution heard from tipsters, as well, tipsters who also claimed that Connell's life was at risk. Stephen Spoonamore, the whistleblower who was the first -- who was the one to name Connell in the first place, also had an ear to the inside. He's also very connected. And all these people were saying Rove is making threats, the White House is very worried about this case.

Having heard all this, Arnebeck contacted Mukasey, he contacted Nancy Rogers, who is the Ohio Attorney General, and he wrote a letter to the court, telling all of them that "This man should be in protective custody. He is an important witness in a RICO case. Please do something to look after him." And they didn't respond to this.

AG: So, explain what this case is all about and exactly what Mike Connell has been doing over these last years. What does it mean to be Karl Rove's IT guru?

MCM: Well, the lawyers in the case refer to him as a high-IQ Forrest Gump, by which they mean that he seems to have been present at the scene of every dubious election of the last eight years. We're talking about Florida in 2000. We're talking about Ohio in 2004. We're talking about Alabama in 2002. He seems to have been involved in the theft of Don Siegelman's re-election for governor. There's some evidence that links him with the Saxby Chambliss-Max Cleland Senate race in Georgia in 2002. To be Karl Rove's IT guru seems to have meant basically setting it up so that votes could be electronically shaved to the disadvantage of the Democrats and the advantage of Republicans.

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Follow Madoff money straight into Washington because the corporate media won't

Pam Martens - Counterpunch

The forces of the universe sent us a corruption triple play the week of December 8th. Just in case there were any slumbering souls still doubting the multi headed monster we need to slay to avoid becoming Rome, those benevolent forces assaulted our senses with a politician, a lawyer, and a Wall Street icon in a three-day sweep of unimaginable crime. Unimaginable, at least, to those of us bereft of adequate imaginations to keep up with the criminals.

The trifecta began on Monday, December 8, with Marc Dreier charged by Federal prosecutors in Manhattan with selling bogus promissory notes to steal what currently adds up to over $380 million. Mr. Dreier, a graduate of Harvard Law and Yale College, is the owner and founder of Dreier LLP, a prominent law firm employing over 250 lawyers.

On Tuesday, December 9, the Feds arrested Democratic Governor Rod Blagojevich of Illinois, revealing transcripts of taped phone calls where the governor was strategizing on how to sell the U.S. Senate seat of President-elect Barack Obama to the highest bidder or career enhancer and, separately, getting revenge on the editorial board of the Chicago Tribune whose writers were saying bad things about him (for some strange reason).

We had a day off to allow our psyches to mend and then Thursday, December 11 arrives.

We are told that Wall Street icon, Bernie Madoff, a key player in self regulation of Wall Street, has stolen $50 billion from investors in a Ponzi scheme stretching over what is now emerging as a three-decade crime spree, or longer. Despite our sprawling Homeland Security apparatus that regularly catches Democratic governors, law enforcement did not catch Madoff; his two sons turned him in after he confessed.

As of December 19, Blagojevich had been released and was in the Governor’s Mansion issuing pardons; Madoff was in his $7 million penthouse in Manhattan after being allowed to post, as collateral for his bond, the East Coast mansions he likely bought with Ponzi money stolen from an eclectic group of charities, Florida pensioners and a well-heeled country club set. Dreier was still in jail even though he stole less than 1 percent of the Madoff take. Apparently, Mr. Dreier lacks the right friends in high places.

The major beneficiary of the week was Citigroup. The leaky piggy bank disappeared from the news along with the investor lawsuit charging it with running its own Ponzi scheme on a scale to dwarf Madoff to piker status. Had it not been for the Madoff media frenzy, folks might have started connecting the dots to a $300 billion taxpayer bailout of a bank serially charged with global misdeeds, market maneuvers internally named “Dr. Evil” and “Black Hole,” and recent press reports that Citigroup had stashed over $1.2 trillion off its balance sheet.

I seldom have the urge to give a comforting pat on the back to people profiled in the Wall Street Journal. But that was my reaction when I read the 21-page whistleblower document about Madoff that was written by Harry Markopolos to the Securities and Exchange Commission (SEC) on November 7, 2005. The Journal still has the document on its web site and Markopolos provides a step by step plan for the SEC to follow to nail Madoff as a Ponzi fraudster. The letter followed a five-year effort by Markopolos, who supplied documentation and made repeated requests to the SEC to investigate Madoff.

Here’s how the SEC characterized the letter from Markopolos in a January 4, 2006 memo: “The staff received a complaint alleging that Bernard L. Madoff Investment Securities LLC, a registered broker-dealer in New York (“BLM”), operates an undisclosed multi-billion dollar investment advisory business, and that BLM operates this business as a Ponzi scheme. The complaint did not contain specific facts about the alleged Ponzi scheme…”

Here’s a tiny sampling of what Markopolos told the SEC in his 21-page November 7, 2005 letter. You decide if these are “specific facts.”

“I am a derivatives expert and have traded or assisted in the trading of several billion $US in options strategies for hedge funds and institutional clients…(Highly Likely) Madoff Securities is the world’s largest Ponzi Scheme…The [Madoff] family runs what is effectively the world’s largest hedge fund with estimated assets under management of at least $20 billion to perhaps $50 billion…The third parties organize the hedge funds and obtain investors but 100% of the money raised is actually managed by Madoff Investment Securities, LLC in a purported hedge fund strategy. The investors that pony up the money don’t know that BM [Bernie Madoff] is managing their money…Some prominent US based hedge fund, fund of funds, that “invest” in BM in this manner include: A. Fairfield Sentry Limited (Arden Asset Management) which had $5.2 billion invested in BM as of May 2005…Access International Advisors…which had $450 million invested with BM as of mid-2002…Tremont Capital Management, Inc…Tremont oversees on an advisory and fully discretionary basis over $10.5 billion in assets. Clients include institutional investors, public and private pension plans, ERISA plans, university endowments, foundations, and financial institutions, as well as high net worth individuals…Madoff does not allow outside performance audits. One London based hedge fund, fund of funds, representing Arab money, asked to send in a team of Big 4 accountants to conduct a performance audit during their planned due diligence. They were told ‘No, only Madoff’s brother-in-law who owns his own accounting firm is allowed to audit performance’…Only Madoff family members are privy to the investment strategy. Name one other prominent multi-billion dollar hedge fund that doesn’t have outside, non-family professionals involved in the investment process. You can’t because there aren’t any…There are too many red flags to ignore. REFCO, Wood River, the Manhattan Fun, Princeton Economics, and other hedge fund blow ups all had a lot fewer red flags than Madoff and look what happened at those places…”

Here is what the SEC’s memo of November 21, 2007 said following its investigation:

“The staff found no evidence of fraud…All files have been prepared for closing…Termination letters have been sent to Bernard L. Madoff Investment Securities LLC, Bernard L. Madoff, and Fairfield Greenwich Group. The staff has no objection to the eventual destruction of the files and has no knowledge of any impediment to such a disposition.”

Let me run that by you again. Mr. Markopolos, a private citizen, uses his personal time and energy over a seven year period to document a fraud occurring under the nose of the SEC that could impact the international reputation of the United States along with the financial well being of pensioners, university endowments, foundations and private investors. After losing track of the case for five years, the SEC finally gets around to investigating using taxpayers’ monies. They come up with nothing despite being given a perfect path to follow to the fraud. And their final suggestion for dealing with the investigation is to destroy the files! With regulators like these, who needs Ponzi artists?

In 1992, eight years before Mr. Markopolos started hounding the SEC to take action against Madoff, the SEC was settling an investigation against two Florida accountants, Frank Avellino and Michael Bienes. The pair had started raising money for Bernie Madoff to manage in 1962, just two years after he came to Wall Street. Avellino and Bienes has sold over $440 million in unregistered notes to thousands of people over yet another three-decade period when the SEC was napping. Mr. Madoff was not charged.

Representing Avellino and Bienes in that matter was Ira Lee Sorkin, the former head of the SEC region in New York City. Mr. Sorkin represents Bernie Madoff today. Put in charge as trustee of the Avellino and Bienes funds and records was Lee Richards. The SEC has put Mr. Richards in place as a receiver and document custodian in the current matter, overseeing the London black hole operation known as Madoff Securities International Ltd.

Marc Mukasey, the son of the U.S. Attorney General, Michael Mukasey, is representing Frank DiPascali, a key Madoff employee. This has resulted in the highest law enforcement officer in the nation recusing himself from the investigation of the largest Ponzi scheme in history.

Naturally, the Madoff money trail of special favors and exceptions leads straight to Washington. From 1998 through 2008, Bernard L. Madoff Investment Securities paid $590,000 lobbying Congress and the SEC, according to the Center for Responsive Politics. His lobby firm for most of those years was Lent, Scrivner & Roth, with Norman F. Lent III signing the disclosure documents in the House and Senate. One of Madoff’s hot button issues during those years according to the disclosure documents was getting a single regulator. That meant, for starters, merging those prying eyes over at the New York Stock Exchange into the clubby pool of self-regulators at the National Association of Securities Dealers where the Madoff family held numerous seats of power. That wish came true when NASD Regulation merged with the enforcement and arbitration units of the New York Stock Exchange in July 2007 to create the Financial Industry Regulatory Authority (FINRA). CEO of the consolidated body is Mary Schapiro, who formerly headed up NASD Regulation, one of the most conflicted bodies in the history of finance. Ms. Schapiro has just been nominated by President-Elect Barack Obama to be the new SEC Chair. Expect to hear more about killing off the SEC (instead of giving it some teeth) and giving Madoff and his fellow miscreants their ultimate dream of just one compromised regulator instead of three.

The Madoff family almost uniformly gives to the same candidates. Cumulatively, since 1993, they have given more than $400,000 to political candidates, committees and PACS.

The Madoff family is also a uniquely telepathic group. When one member had an idea, invariably they all had the same idea. For example, in May 1998, June 1999 and June 2004, a total of seven members of the Madoff family (all living in New York) decided to enrich the coffers of the Ed Markey Committee to the tune of $30,000. Mr. Markey does not represent New York. He is a Democrat who has represented the 7th Congressional District of Massachusetts for more than 30 years. What could have been the motivation?

On February 24, 1997 I flew on US Air flight 6431 from New York to DC along with producer Dean Irwin and a film crew from ABC’s 20/20. We were all heading to Ed Markey’s Congressional office to talk about one of Wall Street’s dirtiest secrets: their denial of an employee’s right to sue the Wall Street firm in an open courtroom, mandating instead, as a condition of employment, that the workers contractually agree to usher all claims (even whistleblower claims) into a crony system of arbitration run by Wall Street firms where case law and legal precedent are not followed and discovery is limited. The system draws a dark curtain around the misdeeds of Wall Street and is an enabling agent for ever greater crimes sealed in secrecy. A dream come true for a Ponzi operator.

Congressman Markey was a threat to Wall Street because he continued to introduce legislation known as the Civil Rights Procedures Protection Act that would have outlawed mandatory arbitration for certain employee claims and allowed those claims to proceed to an open courtroom.

The 20/20 crew spent a good portion of the afternoon filming Congressman Markey and myself talking about arbitration. When the program aired, Congressman Markey was gone from the film and just a brief statement was inserted. For decades now, that legislation, or similar legislation, has been introduced and then died a quiet death; much like the SEC investigations of Madoff.

Pam Martens worked on Wall Street for 21 years; she has no security position, long or short, in any company mentioned in this article. She writes on public interest issues from New Hampshire. She can be reached at pamk741@aol.com

In Banking, Emanuel Made Money and Connections

By MICHAEL LUO

In late 1998, while Washington was in the throes of the Monica Lewinsky scandal, Rahm Emanuel, a departing senior political aide to President Bill Clinton, ventured out to an elegant restaurant in Dupont Circle for something of a job interview.

John Simpson, who ran the Chicago office of the investment banking boutique Wasserstein Perella & Company, had flown to Washington to meet with Mr. Emanuel at the behest of Mr. Simpson’s boss, Bruce Wasserstein, a major Democratic donor and renowned Wall Street dealmaker who had gotten to know Mr. Emanuel.

“I had this idea that this could work and that it had upside,” said Mr. Wasserstein, now chairman and chief executive of Lazard, the investment bank. “It worked out better than I could have hoped.”

And better than Mr. Emanuel could have imagined as well. Over the course of a three-hour-plus dinner, Mr. Simpson and Mr. Emanuel discussed how they might work together. Shortly afterward, Mr. Emanuel accepted an offer, nudging him down what has by now become a well-trodden gilded path out of politics and into the lucrative world of business.

Mr. Emanuel, who was chosen last month to become President-elect Barack Obama’s White House chief of staff, went on to make more than $18 million in just two-and-a-half years, turning many of his contacts in his substantial political Rolodex into paying clients and directing his negotiating prowess and trademark intensity to mergers and acquisitions. He also benefited from the opportune sale of Wasserstein Perella to a German bank, helping him to an unusually large payout.

The period before he was elected to a House seat from Illinois is a little-known episode of Mr. Emanuel’s biography. Former colleagues said the insight it afforded him on the financial services sector is invaluable especially now. But Mr. Emanuel built up strong ties with an industry now at the heart of the economic crisis, one that will be girding for a pitched lobbying battle next year as the incoming Democratic administration considers a potentially sweeping regulatory overhaul.

After Mr. Emanuel left banking to run for Congress, members of the securities and investment industry became his biggest backers, donating more than $1.5 million to his campaigns dating back to 2002, according to the Center for Responsive Politics.

Mr. Emanuel also leaned heavily upon the industry while he was chairman of the Democratic Congressional Campaign Committee during the 2006 midterm elections. Financial industry donors contributed more than $5.8 million to the committee, behind only retirees.

Friends of Mr. Emanuel’s from his private-sector days said he still checks in with them regularly to plumb their insights on economic issues.

“He asks me what am I seeing, what business is like, what’s the climate, where are the weak spots,” said John A. Canning Jr., chairman of Madison Dearborn Partners, a Chicago private equity firm that is in the same building as Wasserstein’s offices.

Mr. Canning was one of many financial executives Mr. Emanuel met with soon after he left the White House to discuss job prospects, with Mr. Emanuel’s political connections often opening doors. Mr. Canning agreed to sit down with Mr. Emanuel at the recommendation of several friends, including Stanley S. Shuman, an investment banker at Allen & Company and a major Democratic donor who once stayed in the Lincoln Bedroom at the White House as a guest of President Clinton’s.

Mr. Canning could not offer him a job, but Mr. Emanuel came to pitch deals to him and they became friends. Employees of that particular firm became Mr. Emanuel’s biggest financial supporters in Congress, according to the Center for Responsive Politics.

When the House was weighing a measure last year to significantly increase the tax rate on profits earned by private equity firms, Mr. Canning said Mr. Emanuel attended a luncheon with Madison Dearborn executives, first reported by Bloomberg News, to listen to their arguments against the changes.

Mr. Emanuel, however, wound up joining other Democrats in voting for the measure.

In an interview, Mr. Emanuel, pointed to other actions he had taken over the objections of the financial industry, including sponsoring a bill last year to curb the ability of hedge fund managers to defer paying taxes on compensation they stashed in offshore tax havens and another measure that imposed new reporting requirements on financial firms for what investors pay on stocks and mutual funds.

“I would say I’ve been as tough on my friends as others,” Mr. Emanuel said. “I call it like I see it.”

Confidants of Mr. Emanuel’s said he decided to try his hand at business because he wanted financial security for his family, before eventually returning to public service.

“He had a number in his head to make enough for the family,” said Ezekiel J. Emanuel, one of Rahm’s two brothers and a prominent bioethicist at the National Institutes of Health.

It was Morton L. Janklow, the literary agent for several former presidents, who introduced Mr. Emanuel to Mr. Wasserstein. Erskine B. Bowles, the White House chief of staff and a former investment banker, also said he recommended Mr. Emanuel. Mr. Emanuel met in Mr. Wasserstein in his New York office, where they had a wide-ranging discussion about the future of financial regulation, as well as Mr. Emanuel’s plans.

Jeffrey A. Rosen, now deputy chairman of Lazard and a former managing director of Wasserstein Perella’s international practice, said Mr. Emanuel was “both a developed and a raw talent.”

“His years in the White House and what he’d done before that really honed what I’d call deal-making instincts, which could be easily translated into the business arena,” Mr. Rosen said. “Plus, he was someone who was well connected in Chicago and highly respected.”

Mr. Emanuel turned out to be an effective banker, proving a quick study with financial concepts, even as he relied on others in his office for heavy number crunching, former colleagues said. He worked 12-hour days and was known among clients for his relentlessness, constantly on the phone or sending e-mail, and being unafraid to pitch deals. Revenue in Wasserstein’s Chicago office climbed significantly after his arrival.

There is no evidence Mr. Emanuel used his political clout on behalf of his clients, but his connections certainly helped drum up business and contributed to his hiring, former colleagues said. Indeed, a partial list of clients from Mr. Emanuel’s Congressional financial disclosure in 2002 is easily linked up to the various strands of his political career, including his time as a fund-raiser for Mayor Richard M. Daley of Chicago and then for Mr. Clinton’s first presidential run.

The clients included Loral Space & Communications, run by Bernard L. Schwartz, one of the Democratic Party’s biggest donors, who said he got to know Mr. Emanuel while he was in the White House; the Chicago Board Options Exchange, whose chairman and chief executive, William J. Brodsky, became friends with Mr. Emanuel while he was working for Mayor Daley; and Avolar, a business aviation company whose top executive, Stuart I. Oran, was formerly in charge of governmental affairs for United Airlines, a role in which he said he interacted with Mr. Emanuel at the White House.

One of Mr. Emanuel’s major deals was the purchase in 2001 of a home alarm business, SecurityLink, from SBC Communications, the telecommunications company that was run by William M. Daley, the former secretary of commerce in the Clinton administration and the brother of Chicago’s mayor.

Mr. Emanuel represented GTCR Golder Rauner, a Chicago private equity firm that was buying the business for an affiliate. Bruce Rauner, the firm’s chairman, had first met Mr. Emanuel when he was still exploring job prospects in Chicago after getting a call from Mr. Bowles, an old friend.

Instead of private equity, Mr. Rauner advised Mr. Emanuel to pursue investment banking, where his political experience might be more valuable in landing deals in regulated industries.

Mr. Emanuel called him back after starting at Wasserstein and asked if he could take over coverage of GTCR for his new employer. That eventually led to the nearly $500 million SecurityLink deal.

Mr. Emanuel’s biggest transaction came in late 1999 when he landed an advisory role for Wasserstein in the $8.2 billion merger of two utility companies, Unicom, the parent company of Commonwealth Edison, and Peco Energy, to create Exelon, now one of the nation’s largest power companies.

John W. Rowe, the former chief executive of Unicom who now holds the same position at Exelon, sought out Mr. Emanuel after he went to Wasserstein. Mr. Rowe said he believed Mr. Emanuel would offer a different dimension, providing wisdom on what might pass muster at the governmental level.

“You can’t understand utility transactions without thinking about whether they’ll play or not play in legal and political circles,” said Mr. Rowe, who was first introduced to Mr. Emanuel by Lester Crown, the billionaire scion of Chicago’s influential Crown family.

Tax returns Mr. Emanuel released while first running for office and reported in news articles, along with Congressional financial disclosures, reveal his steep financial ascent while working at Wasserstein. He earned more than $900,000 in 1999, his first year at the firm; nearly $1.4 million in 2000; and $6.5 million in 2001, when he left the firm in midyear to run for Congress. He collected $9.7 million more from the firm in deferred compensation in 2002.

Mr. Emanuel’s annual salary was not especially large but his hefty paydays came from bonuses for the business he brought in, as is customary in investment banking, along with the company’s sale in 2001 to the German Dresdner Bank, which allowed him to benefit from an equity stake, as well a large retention bonus paid to him based on his prior performance.

The bonanza Mr. Emanuel reaped would come in handy when he ran for the House seat vacated by Representative Rod R. Blagojevich, now governor.

Mr. Emanuel contributed $450,000 out of his own pocket to his campaign in the primary, and his leading rival accused him of trying to buy a seat in Congress.

Canadian Leader Shuts Parliament

By IAN AUSTEN,

OTTAWA — Canada’s parliamentary opposition reacted with outrage on Thursday after Prime Minister Stephen Harper shut down the legislature until Jan. 26, seeking to forestall a no-confidence vote that he was sure to lose and, possibly, provoking a constitutional crisis.

Mr. Harper acted after getting the approval of Governor General Michaëlle Jean, who represents Queen Elizabeth II as the nation’s head of state. If his request had been rejected, he would have had to choose between stepping down or facing the no-confidence vote on Monday.

The opposition fiercely criticized the decision to suspend Parliament, accusing Mr. Harper of undermining the nation’s democracy. “We have to say to Canadians, ‘Is this the kind of government you want?’ ” said Bob Rae, a member of the opposition Liberal Party. “Do we want a party in place that is so undemocratic that it will not meet the House of Commons?”

That sentiment was echoed by constitutional scholars, who lamented that the governor general might have created a mechanism that future prime ministers could use to bypass the legislature when it seemed convenient.

“This really has been a blow to parliamentary democracy in Canada,” said Nelson Wiseman, a professor of political science at the University of Toronto. “It has lowered the status of the elected Parliament and raised the status of the unelected prime minister.”

Thursday’s events had their origins in a hotly contested election, which Mr. Harper’s Conservative Party won less than two months ago without achieving a majority, leaving it vulnerable to challenge. In light of that and the growing economic turmoil, Mr. Harper promised to work closely with the opposition in the Parliament.

But the proposed budget he presented last week had none of the stimulus programs that the opposition had sought to help Canada’s sagging economy. The final insult for the main opposition parties, the New Democrats and the Liberals, was a provision that would eliminate public financing for political parties. They considered it a deliberate slap because Mr. Harper’s Conservative Party is currently far better financed than they are.

With that, they began scrambling to put together a coalition with the backing of the separatist Bloc Québécois to displace Mr. Harper’s government.

Mr. Harper said he suspended Parliament to allow time to put together a budget that he would introduce in January, and he once again spoke in conciliatory terms, inviting the opposition to participate in the drafting. “Today’s decision will give us an opportunity — and I’m talking about all the parties — to focus on the economy and work together.”

But Stéphane Dion, who leads the Liberals and who would become the coalition’s prime minister, dismissed the idea of working with Mr. Harper and said the Conservatives’ budget was unlikely to satisfy the opposition’s economic demands.

“We do not want any more of his words, we don’t believe them,” Mr. Dion told reporters before the closed doors of the House of Commons. “We want to see changes, monumental changes.”

Opposition leaders said they would continue to try to form a new coalition, and strongly criticized Mr. Harper’s attempt to thwart them. “He’s put a lock on the door on the House of Commons,” Jack Layton, the leader of the New Democrats, told reporters. “He refuses to face the people of Canada through their elected representatives.”

The opposition’s move to form a new coalition has, in turn, elicited sharp criticisms from some Conservative members. “That is as close to treason and sedition as I can imagine,” Bob Dechert, a Conservative member, said Wednesday, echoing a refrain heard widely in Alberta, the prime minister’s home province.

Technically, what Mr. Harper did was to “prorogue” Parliament, a move that stops all actions on bills and the body’s other business, and thus goes well beyond an adjournment (which was not available to Mr. Harper in any event, as it requires parliamentary approval). It is not unprecedented — prorogation is used occasionally to introduce a new legislative agenda — but this is the first time any Parliament members or constitutional scholars here could recall the maneuver being used in the midst of a political crisis and over the objections of Parliament.

Mr. Harper declared the parliamentary suspension after a two-and-a-half hour meeting in Ottawa with Ms. Jean. While no governor general has ever previously rejected a prime minister’s request to prorogue Parliament, several constitutional scholars said Mr. Harper was the first one to have asked permission when he did not have the support of the legislature.

“That’s why they spent two and a half hours talking,” said C. E. S. Franks, a professor emeritus of political studies at Queen’s University in Kingston, Ontario.

Ms. Jean did not explain her decision, but Professor Franks speculated that Ms. Jean thought it was the least disruptive option. “There’s every likelihood that saying no would have thrown the whole system into turmoil,” he said. “But maybe it needs that.”

None of the opposition parties have suggested that they will mount a legal challenge. Adam Dodek, a law professor at the University of Ottawa who has studied the governor general’s powers, said Canadian courts could offer only an opinion about the constitutionality of the decision. They lack the ability to issue orders to the governor general.

“I think it highly unlikely that any court would want to deal with this,” Professor Dodek said.

He added that an appeal to Queen Elizabeth was impossible.

In contrast to the relative public indifference to the elections two months ago, the current situation has provoked a passionate debate in the country and inflamed latent regional tensions.

In Western Canada, the Conservatives’ main base of support, political commentators are arguing that the coalition represents an attempt by more populous Ontario and Quebec to deny political influence to the West. But many Quebecers, particularly French speakers, have been offended by Conservative suggestions that they have no interest in remaining a part of Canada.

http://www.nytimes.com/2008/12/05/world/americas/05canada.html?_r=1&th&emc=th

Union-Busters Want GM to File for Bankruptcy

By Jane Hamsher, Firedoglake
http://www.alternet.org/blogs/peek/106911/

Let's call it what it is:

[N]ot everyone agrees that a Chapter 11 filing by G.M. would be the disaster that many fear. Some experts note that while bankruptcy would be painful, it may be preferable to a government bailout that may only delay, at considerable cost, the wrenching but necessary steps G.M. needs to take to become a stronger, leaner company.

Although G.M.'s labor contracts would be at risk of termination in a bankruptcy, setting up a potential confrontation with its unions, the company says its pension obligations are largely financed for its 479,000 retirees and their spouses.

This is about union busting, pure and simple.

No mention made about Rick Wagoner giving back the $2.2 million salary he pulled down in 2008 for driving GM into the ground.

Jane Hamsher is the founder of FireDogLake. Her work has also appeared on the Huffington Post, Alternet and The American Prospect.

© 2008 Firedoglake All rights reserved.
View this story online at: http://www.alternet.org/blogs/peek/106911/

THE MEN HE DIDN’T LIKE

By Will Rogers, from a recording released May 31, 1923, by Victor Records. The origins of the speech are unknown; Rogers may have been speaking before the annual convention of the American Bankers Association in 1922, in New York City. The document is included in The Papers of Will Rogers, Volume Four, published by the University of Oklahoma Press.

Loan sharks and interest hounds—I have addressed every form of organized graft in the United States, excepting Congress, so it’s naturally a pleasure for me to appear before the biggest. You are without a doubt the most disgustingly rich audience I ever talked to, with the possible exception of the bootleggers’ union, Local No. 1, combined with the enforcement officers.

Now, I understand that you hold this convention every year to announce what the annual gyp will be. I have often wondered where the depositors hold their convention. I had an account in the bank once, and the banker, he asked me to withdraw it. He said I had used up more red ink than the account was worth.

I see where your convention was opened by a prayer, you had to send outside your ranks to get somebody that knew how to pray. You should have had one creditor there; he’d have shown you how to pray. I noticed in the prayer the clergyman announced to the Almighty that the bankers were here. Well, it wasn’t exactly an announcement. It was more in the nature of a warning. He didn’t tell the devil, as he figured he knew where you all were all the time anyhow.

I see by your speeches that you’re very optimistic of the business conditions of the coming year. Boy, I don’t blame you. If I had your dough, I’d be optimistic too.

Will you please tell me what you all do with the vice presidents the bank has? I guess that’s to get anybody more discouraged before they can see the main guy. Why, the United States is the biggest business institution in the world. They got only one vice president. Nobody’s ever found anything for him to do.

You have a wonderful organization. I understand you have 10,000 here, and what you have in federal prisons brings your membership up to around 30,000. So goodbye, paupers. You’re the finest bunch of shylocks that ever foreclosed a mortgage on a widow’s home.

Jerry's diggin' for that prison-guard cash to help fund his gubernatorial run...

...and it looks like he got it!

From Daniel Abrahamson at HuffPo

http://www.huffingtonpost.com/daniel-abrahamson/jerrys-brown-nosin-ith-c_b_139293.html

The California prison guards' union -- one of the state's richest and most reviled special-interest groups -- is funding a multi-million-dollar attack on Proposition 5, the Nonviolent Offender Rehabilitation Act. The prison guards' newest ally is Jerry Brown, attorney general and former governor of California.

Prop. 5 is a modest and sensible reform of California's corrections system that promises to reduce the state's bloated prison population and, in the process, cut state spending by billions of dollars. The measure is supported by a wide-range of treatment professionals, good-government types and former high-ranking corrections and law enforcement officials.

The prison guards, however, oppose Prop. 5. They don't like the math. Fewer prisoners will mean fewer jobs and less overtime pay for prison guards. Today we released a new ad that will be running throughout the state that shows how the prison guards are sabotaging California's future for their own self interest.

Prop. 5 would also forestall massive new prison construction. For taxpayers, that means saving $2.5 billion for each new prison that is no longer needed. For the guards, however, fewer prisons will mean less staff to run them -- and possibly fewer new dues-paying members in the future. This is bad news for a union with burgeoning membership that boasts higher annual take-home pay than the governor. To put it bluntly, the prison guards' union is built on the backs of human beings in cages.

A.G. Jerry Brown's role in all this is the most perplexing. He is either taking progressives for granted or figures they'll give him a pass for cozying up to the prison guards and fighting a measure that offers drug treatment and a second chance to young people, nonviolent offenders and prisoners.

Since I am a co-author of Prop. 5, Jerry contacted me a couple of weeks back. Said he wanted to talk about Proposition 5. He called me on my cell phone while I was participating in a panel discussion about California's prison crisis sponsored by U.C. Berkeley. I decided to duck out of the symposium. Months earlier, I had reached out to Jerry to discuss the details of Prop. 5, but those calls went unreturned. I figured that, if Jerry Brown was now ready to talk about Prop. 5, that would be a good use of my time.

"OK," I say, "let's talk." Turns out, Jerry doesn't want to chat about public policy. He wants to vent. He lectures me for five minutes about how, when he's governor, he'll solve the state's decades-old prison crisis in his first month in office. He neglects to mention that the roots of the prison crisis date back to his first stint as governor.

Jerry pounces: "Prop. 5 is anti-democratic," he complains. I tell him that that's an odd attack, particularly when Prop. 5 creates an independent citizen's oversight commission, appointed by the legislature and governor, to bring transparency and change to the state's prison system. And what could be more democratic than a voter initiative?

Jerry switches tack. He argues that Prop. 5 deprives him -- and by "him" it is clear Jerry means the next governor of California -- of too much power over prisons. I ask him whether he's actually read Prop. 5. No response. I note that Prop. 5 in fact allows the governor to appoint two officials to head up the state's prison and parole agency, not just the one allowed under current law. The governor also gets to appoint more than half the members of new oversight panels that, in turn, must run public hearings, take public comment and publish audits and reports on their activities. These panels provide new levels of transparency and accountability for prisons and for treatment programs statewide.

Jerry gets flustered. His angry pit-bull persona dissolves into more of a wet pug. "But the drug court judges oppose you," he stammers. "True," I respond. "But their opposition, like the prosecutors and prison guards, is ideological, not evidence-based." I continue, "All of the state's leading drug treatment and medical professionals -- the folks who know the most about delivering substance abuse and mental health services to this population -- support Prop. 5." Also, recalling Jerry's "anti-democratic" blast earlier, I note that the drug court judges voted to oppose Prop. 5 when their partners in the treatment community were out of the room.

Jerry wants off the phone. "Okay. Listen. This thing is complicated," he says. "I need you to walk me through Prop. 5, line by line, so I can understand what you are doing here."

"Great," I say. "How about we talk later today or tonight, right after this prison symposium is over. I can meet you or go over it by phone." Jerry gives me his mobile number.

Later that evening, I call Jerry. No response.

I call Jerry more than a dozen times over the next week, not only on the cell number he gave me, but also on two other numbers I have for him. I call every morning and every afternoon. I leave messages. Jerry has my home, office and wife's cell phone numbers. He knows what time I pick up and drop off my son at kindergarten. Still no word from Jerry. I'm starting to think the facts don't matter, despite his entreaty to grapple with the details of Prop. 5.

Two weeks later, Jerry accidentally answers his cell phone while getting in his car to go to Sacramento. It's me. "Let's talk," I say. Jerry sounds bummed that he forgot to check caller ID. He says, "Can't talk now. I'll call you tonight at home." I say, "Great. No hour is too late." I give him my numbers again.

Jerry doesn't call.

But Jerry was working the phones, after all. He's done a press conference for No on 5. He's inserted himself into the campaign, courtesy of the prison guards. They are now listed as among the largest contributors to "Jerry Brown 2010." Their biggest gift to date: $825,000 worth of TV time starting this week for No-on-5 ads starring Jerry.

If those ads help Jerry, he'll move one step closer to becoming CEO of one of the largest, most expensive and worst-performing penal colonies in the world. History suggests that in 2010 he will need some help with his prison problems. I don't trust him to make the right call.

Daniel Abrahamson is the Director of Legal Affairs at the Drug Policy Alliance Network and co-author of Prop. 5