Many Accounts and Chronicles 


The Great Texas Bank Job

What a Wicked web we weave

The far reaching cause and effect of the Largest Bank Robberies in Human History

Quid Pro Quo In Action

No better example will serve to demonstrate the quid pro quo arrangement that underlies American politics than through an acquaintance with the circumstances surrounding the failure of a particular S&L;, Lincoln Savings and Loan of Irvine California. First a brief introduction.

The S&L; problems began in 1982 with the introduction of the Garn-St.Germain Act (introduced by Senator Jake Garn (R-Utah)), which had to do with deregulating the banking industry. Deregulation in a nutshell amounts to less regulation and less supervision. The first relaxation of regulations actually occurred in 1981, when S&Ls; were permitted to offer variable-rate mortgages. In 1982 they were allowed to branch into business loans and into the funding of developers' real estate ventures. {B118} The relationships that soon evolved between developers and S&L; owners amounted to real estate speculation teams. The speculation binge that resulted created an artificial boom that made billions of quick and easy profits for existing multimillionaires, before eventually going bust in a big way. Hell-bent on deregulation, the Reagan Administration even denied the Federal Home Loan Bank Board money to increase the number of its regulators.

And now to the Lincoln fiasco.

When Mr Charles Keating, a lawyer, purchased Lincoln Savings and Loan for $51 million back in 1984, it had assets worth 1 billion. In one of his investment ventures later that same year, Keating used Lincoln's federally insured S&L; deposits to effectively make $30 million in "greenmail" profit involving a take over bid for Dallas-based Gulf Broadcasting Co. {B119} Then in 1985, Mr Keating hired none other than the present chairman of the Federal Reserve Board, Mr Alan Greenspan, to lobby government to allow diversification from home loans into direct equity investments. In fact, Mr Greenspan praised Lincoln as "a financially strong institution that presents no foreseeable risk to the Federal Savings and Loan Insurance Corporation". Mr Greenspan was successful. Mr Keating was virtually free to speculate directly. Mr Greenspan's lobbying had in effect pulled the cork. By October 1986 when San Francisco regulators first investigated Lincoln, the S&L; already had unreported losses of $135 million. The regulators started putting pressure on Mr Keating.

At this stage Mr Keating first called in four of the five Senators (that would later come to be called the "Keating Five") to lobby on his behalf. The Senators, who were all recipients of Keating's generous campaign support, received the following: Senator Alan Cranston of California, $974,000; Senators John McCain of Arizona, $125,000; Dennis DeConcini of Arizona, $48,000; Senator John Glenn of Ohio, $234,000; and Senator Riegle of Michigan, $76,000. The first four Senators lobbied the Washington-based head of the Home Loan Bank Board, Mr Edwin Gray, on April 2 1987, in Senator DeConcini's office. Mr Gray, who later commented that the four senators "came at me like lawyers arguing for a client", refused to be bullied into submission and suggested that they deal directly with the San Francisco Bank Board regulators under whose jurisdiction Lincoln actually fell.

One week later, they did. But this time the four original Senators were joined by Donald Riegle, now Chairman of the Senate Banking,

Housing and Urban Affairs Committee. The San Francisco regulators held to their position that Lincoln should be shut down.

Soon after this meeting Mr Gray in Washington was replaced by Mr Danny Wall, who had been the top aide of Senator Garn (who had begun the reckless spree in the first place). Mr Wall acted quickly to prevent the San Francisco branch of his Board from shutting Lincoln down by transferring the regulatory authority for Lincoln Savings and Loan from San Francisco to Washington, and thus under his direct control. {B120} It is estimated that the 20 month delay to the closure of Lincoln Savings that resulted (caused collectively by the five senators and Danny Wall), will cost the taxpayers an additional $1.5 billion dollars. {B121} In all, the cost to taxpayers for the failure of this S&L; alone, is estimated at from $2 billion to 2.5 billion.

Few articles have conveyed the favors for favors mechanism underlying American politics better than the article entitled "An amazing tale" on page 66 of the August 26 1989 issue of The Economist, which deals with the Lincoln Savings and Loan debacle. If you next read "High-Rolling Texas: The State That Ate FSLIC", you probably won't need to read much more about how Congress operates. {B122}

However, if you are a glutton for punishment, I would certainly recommend you read the following additional related articles, but make sure you have a sick-bag handy when you read them.

Start with "The Seduction Of Senator Alan Cranston which appeared on page 82 of the December 4 1989 issue of Business Week. {B123} Then try the article entitled "DeConcini Banks On Voter Loyalty" in the Dec 18 1989 issue of Insight which disclosed, among other things, that DeConcini and family had made a 540% profit on parcels of land that they, through privileged political knowledge, knew were to be used for a $3.8 billion canal project called Central Arizona Project. The DeConcinis, it seems, did not share this information with the folks whom they purchased the lands from. {B124} The article also mentions that Senator McCain flew in Keating's private plane on several occasions to the Bahamas to vacation and enjoy hospitality in Keating's house.

In short, each of the articles gives a tip of the iceberg peek into the general ethical standards of the men running the nation, and does a fine job in helping to put American democracy in perspective.

But the Lincoln incident is not an isolated incident, quid pro quo is practically the only game in town.

Additional insights on the topic of quid pro quo can be gained from reading "How one family handles its finances", on page 42 of the June 12 1989 issue of Forbes, which outlined how Jim Wright, the ex Speaker of the House was able to enhance his lifestyle beyond the normal limits of his Congressional salary. {B125} It is worth noting too that in 1986, Jim Wright also used his lobby power on behalf of his fellow Texans to prevent Mr Edwin Gray from putting the squeeze on the S&L; industry. I guess it was his way of thanking the thrift and real estate interests who had donated $240,000 to his 1986 campaign war chest.

Meanwhile, in an effort to stamp out thrift examiners, Texans killed a measure in committee in 1987 that would have increased the pay of thrift examiners, whose starting pay is only $18,500.

Honest Politicians

Wait just a minute. In all fairness, should not the honest politicians be given some credit too? Yes indeed they should, no matter how few in number they may be.

One such individual is Mr Henry Gonzalez, chairman of the House of Representatives' banking committee, who played such an important part in exposing the Lincoln abuses. He is busy investigating another S&L; called Silverado which appears just as worthy of headlines. It is alleged that Silverado, like Lincoln, was involved in buying up assets (mainly junk bonds) which had been first artificially pumped up in value by being sold profitably back and forth between selected insiders (prior to selling the overpriced assets to the various S&Ls; involved. The insiders allegedly included among others, Colorado-based Silverado S&L;, California-based Lincoln S&L;, a Miami-based thrift called CenTrust, Houston-based San Jacinto Savings (owned by the now bankrupt Southmark), and a troubled Colorado property development company called MDC Holdings which worked closely with Silverado S&L.;

The interesting point to note is that it was Mr Larry Mizel, chairman of MDC Holdings who introduced President Bush when he surprisingly showed up at a Republican fund-raising lunch in Denver in late 1989. Mr Mizel's company is at the center of a federal investigation of Silverado S&L; which had as one of its directors none other than one of President Bush's sons, Neil. Both Silverado and Mr Mizel's company (MDC) are being investigated by the honest politician Mr Gonzalez.

Neil Bush, the President's son, was a director of Silverado from 1985-1988, during which time the alleged artificial profit taking was occurring. Silverado's bailout alone cost the taxpayers over $1 billion.

Not only that, the man who provided the insider connection between all these entities was none other than Michael Milken the junk bond king. He provided the means for the entities to buy up each other's thrift junk bonds. Should anyone be surprised?
Perhaps I should have warned the readers to wear knee high rubber boots when approaching politics for a closer view, because it's literally impossible to get a close look into the pig trough without being surrounded by some pretty foul smelling mire. {B126}

Keep your nose plugged, because I have to tell you that even George Bush's campaign manager, Thomas Loeffler (another Texan) solicited support from the Reagan Administration to appoint lobbyist Texan Durward Curlee to the Federal Home Loan Bank Board. Loeffler's client list was a virtual Who's Who of S&L; owners, and Curlee was once executive director of the Texas Savings and Loan League. Again it's foxes minding the chicken coop.

Jay Leno, an American talk-show comedian had a brilliant suggestion. Because there is such a shortage of prison space in America, why not build a high wall around Capitol Hill and the White House and convert the whole area into a State Prison!!

Red-handed but definitely not Red-faced

We are currently going through an era where money and favors are being dished out so fast and furiously, that in the scramble, players are losing track of the need to conceal the graft and corruption. When politicians get caught nowadays, they don't consider remorse or guilt any more, ...only anger and indignation at perhaps losing their place at the trough. One or two examples from the countless available will serve to illustrate this brazen new technique for sidestepping justice.

Although Mr Wall resigned in December to help take some of the heat off the issue, {B127} and Mr Keating began taking the 5th amendment, {B128} the cocky senators have not stepped down because what they did is no different from what virtually everyone else in Washington is doing. After the scandal was uncovered, Senator Riegle returned his campaign contributions in a naive bid to buy back his innocence. Senator McCain eventually reimbursed Mr Keating for his plane rides. Later he commented, "I've openly and candidly admitted it was a mistake for me to not reimburse on time". {B129} But like Nixon and Oliver North, all five senators are well aware that defiance and continued declarations of innocence are honored and rewarded, because it gives the establishment a chance to use the mass media to do what they can to diffuse the issue.

For starters, it is practically unthinkable for lawyers to admit guilt, and so even though an increasing number of Washington lawyers or their clients get caught red-handed, they, like Oliver North, take their chances at riding out the controversy, because history has proven that this approach works best. To weather the storm, some or all of the following tactics are almost always employed:

Why have these tactics come to be used so often, so successfully, and increasingly more openly on Capitol Hill? Mainly because these four tactics are the most successful tactics used in law today, and Capitol Hill is literally teeming with lawyers. Sixty out of 100 senators, and 186 out of 435 House members have law degrees, as have the majority of the Senate and House Judiciary Committee members. {B130} Needless to say, the lobbyists are basically lawyers as well. Congress, is little more than a fraternity of lawyers. Capitol Hill is to lawyers what Wall street is to MBAs.

Those who are forced to disembark from the gravy train are usually compensated by the elite for their past loyalty. The media elite quite often help out by promoting their books, or by tucking them under a wing as they did with Nixon in subsequent years.

The special interest lobbying and subsequent legislation that allowed for easy overnight wealth for S&L; owners, and merger and acquisition players, will be extremely hard to top in the coming decade. Nevertheless, no one appears to know when to stop. As more and more S&Ls; declared bankruptcy, Mr Wall kept the brakes on remedial action by insisting on lowball estimates of the potential S&L; industry losses. When it became obvious that the Federal Savings & Loan Insurance Corporation (FSLIC) could no longer cope with the enormity of claims payouts, Danny Wall was placed in charge of the new Office of Thrift Supervision which then had the job of disposing of the assets from the bankrupt S&Ls.;

Evidence is now coming to light to suggest that the S&L; bailout operation itself was taken as yet another opportunity to offer favors to the wealthy. As director of the Office of Thrift Supervision, Mr Wall was again in the driver's seat, about leaving the fox to mind the chicken coup. The plan he came up with was called the Southwest Plan, and just two of his deals should be enough to convince anyone that Mr Wall has made many friends among the economic elite.

The first case involves a Mr Ronald O. Perelman. (You might remember Mr Perelman as the billionaire who, according to Forbes magazine, made $750 million last year.) For this particular deal, Mr Perelman put up $315 million, of which $155 million was borrowed, to take over ownership of, among other things, First Texas Gibraltar, an S&L; which had racked up its losses serving as a real estate speculation vehicle for none other than the former Democratic Party chairman Robert Strauss, whose very close social friend Mr Alan Greenspan, currently in charge of the Federal Reserve, was the gentleman who initially lobbied for Lincoln Savings and Loan to deregulate the S&L; industry! Amazingly small world isn't it, and all so logically interconnected! {B131}

However, to get back to the point. For his $315 million investment, Mr Perelman received the following: good assets worth $7.1 billion; $5.1 billion in Federal guarantees to cover the thrift's bad assets; plus $900 million worth of tax benefits! Within a week, Perelman had sold $2 billion of FTG's dodgy assets which generated tax loss credits that saved him roughly $135 million in taxes. In short, the rate of return on his initial investment, in the first 90 days, amounted to roughly 80%. We should all be so lucky. The rest will be gravy. {B132}

The second case worthy of mention involves the sale to PMH Corporation of five S&L; thrifts with 25 retail branches and about $1.3 billion in assets, for the paltry sum of $45 million. Like the deal to Perelman, the terms of the deal ensured that the government (i.e. the taxpayer) would absorb any of the thrifts' existing bad debts. In the first 15 months, $132 million of good assets were sold that more than easily recouped the initial $45 million purchase price. Most of the remaining assets are covered by government guarantee against loss to the new owners, and the estimated $40 million in earnings and tax breaks expected this year alone are pure profit.

Although these deals sound more like giveaways, many of the deals initially sanctioned by Mr Danny Wall were just as lucrative. Incidentally it is probably worth mentioning that Mr Grosfeld, the CEO of PMH's subsidiary, is director of several Blackstone Group funds. And, oh yes, the Blackstone investment firm just happens to be headed up by Mr Peter G. Peterson, former Secretary of Commerce, and by Roger C. Altman, the former Assistant Secretary of the Treasury. {B133}

Unfortunately for the elite and the taxpayer alike, the S&L; bailout deals appeared a little too much like additional gifts to the haves at the expense of the taxpayers, so that a special boondoggle committee may have to be set up to investigate the matter. The aspect that has made these bailout deals so beneficial to the lucky buyers is the tax loss credits that went along with the deals. In short, massive tax avoidance vehicles.

The impending Capital Gains Tax cut will be a variation on an already too familiar theme. The Joint Committee on Taxation says the capital gains proposal passed by the House on Sept. 28 1989 would cost $35 billion in lost revenues over the next 10 years. The recipients will be almost exclusively the richest 10%. In the House, 64 Democrats who theoretically owe a fiduciary responsibility to the bottom 90% voted for Bush's tax cuts. {B134}

Because politicians, both Republicans and Democrats alike, come mainly from the richest 10 percent and have small personal fortunes to protect, they are eager to create tax shelters. After all, exemption from taxes is still one of the best vehicles available for amassing and retaining wealth. The tax reforms of 1981, which relieved the elite of so much of their tax share that budget deficits and widespread social program cutbacks resulted, were passed for exactly the same reason. As long as the Congress is controlled by lawyers, the rich will continue getting richer while the poor become poorer.

   "There is no distinctly native American criminal class except Congress" -Mark Twain

Dick Armey

Bob Barr

Corrine Brown

Dan Burton



 Jerry Costello

Tom Delay


Dick Gephardt

Henry Hyde

David McIntosh



Bud Shuster


Jim Traficant




Robert Byrd

Jesse Helms

Trent Lott

Bill Clinton
(someone else's page)

Newt Gingrich




What's New or Upcoming & Links

Comments? Recommendations for Crookhood?

 Tell me or Sign my Guestbook or View my Guestbook

FDIC's Official Site

Charles Keating and Lincoln Savings and Loan;/slbib9.html


Navy flier testifies he flew Bush to Paris for deal to block release of hostages


The Clinton Administration's Ethical Problems: Here's What Has Been Reported About*....

Dallas I 30 Condo Schemes

Henry Hyde's Ghosts

Hanging Death of Mark Lombardi (Artist who Diagramed Who Looted which Banks and S&Ls;)

The Clinton Administration.
1998 The Clinton Administration Page: a part of The Capitalist Conservative Republican Homepage. All rights reserved
Clinton Impeached! Jail to the Chief!
Legal Justification that perjury is impeachable - The House was completely within its Constitutional rights.
Welcome! This page is designed to serve as a comprehensive collection of information surrounding the highly corrupt activities of the Clinton administration. Ranging from the solid facts and evidence, to the humorous anecdotes, thorough information about the Clinton presidency is included. To use this page, scroll down to the "features" section for a list of topics. Popular pages include an introduction to all the "gates" and "waters" of the Clinton administration, a list of convictions from the many Clinton scandals, lists of solid evidence against Clinton as presented in the Starr report and in other publications, and a guide to the legal understanding of how impeachment works.

Reflections on Impeachment

       Years of repeated lies, scandals, illegal and possibly treasonous acts, and disgustingly perverse behavior have caught up with Bill Clinton.  The United States House of Representatives took the necessary bold condemnation of this sorry excuse for a president by impeaching him for perjury and obstruction of justice.  Clinton is only the second president to ever have been impeached.  Bill Clinton's senate trial, however, did not fare so well.  While demanding cooperation from Republicans, the Senate Democrats displayed the truth behind their 'bipartisan' facade. I guess bipartisanship only occurs when Republicans give in to Democrats.  Then again, one could expect such a verdict in a trial when 45% of the Senate had already chosen to vote for acquittal long before Clinton was even impeached.  The Senate practically agreed in unanimity that Clinton broke the law, then acquited him! It is a sad day when certain members of Congress place their allegiance to their party and leader, a sorry excuse for one at that, above the Constitution and rule of law.  Message to the spineless Democrats and Republican dissenters: Think for yourself for a change!

The many faces of Bill Clinton

"If a President of the United States ever lied to the American people he should resign." Bill Clinton in 1974

        Bill Clinton committed several serious crimes while in office and these crimes will become his legacy.   Even Democrats find it hard to dispute the material evidence against the president.  The fact perjury was committed has recieved little challenge.  What this means is that we have a felon in the White House.  According to the law and Constitution this felon should recieve penalty for his actions.   Unfortunately, some senators spit on the sacred document we call the Constitution.  Exepctedly, not a month passed before a new scandal arose.  The only constant aspect of the Clinton administration is the fact that new scandals arise weekly.  I still urge this president to resign and prove he has some aspect of common decency.   If not for himself, resignation should be on behalf of the American judicial system, any honor that is left in our legal system, in respect of the office of the presidency, and for the sake of the future of the United States of America.

More on the Scandal

Ken Starr's Report

Clinton Links and Features:
Look for the  indicator!

Bill Clinton's acting career.


Bill's new home!

Links to related sites:

Updates on The Impeachment of Bill Clinton

The Bill Clinton Scandal of the Week: 8/1/99
Interngate/Paula Jonesgate- Clinton was ordered to pay a $100,000 penalty for his contempt of court charge for lying under oath. The money goes to pay for Jones's legal fees and Judge Wright's travel costs. Meanwhile several lawyer groups are petitioning for Clinton's disbarment.
NEW: Scandals PBS-gate and Filegate II break. See below for detail

"I'm just trying to suppress my natural impulses and get back to work." - Bill Clinton on Interngate
Scandal Updates: Townhall Online

Just another snafu Mr. President?

Scandal Updates Since The Lewinsky scandal

STATE OF THE UNION - President Clinton's advisors edited phrases about "family values," "integrity,"  and "personal leadership" from the speech to avoid possible laughter and embarrassment. 1/22/98 Clinton admits to affair with Gennifer Flowers before he came to office. 1/24 Kenneth Starr accused of wrongful investigations by White House 1/24 Clinton's Ratings in the polls are falling fast 1/24 Clinton hugging Lewinsky video found
Click here for the rest of the list.

Who's Who in the Clinton Scandals:
    I have noticed many of the key figures are Clinton friends and Democrats who would have no reason or motive to speak out against him except the when telling what actually happened.  Therefore I have added these symbols:
- denotes Democrats (many of the Clinton Administration itself)
- denotes Clinton collegue
- denotes convicted/plead guilty in a scandal related to Clinton
- denotes Clinton associate who is being/has been investigated due to a scandal

List 1: Key figures

List 2:  The scandals:
A list of all the "gates," most are serious, a few are humorous
Remember: Nixon only had one, Harding had but a few,
The Clinton Administration has dozens
Most scandals link to a brief description (more detail is coming shortly) Bonus: Humorgate: some mishaps and mysteries around the Clintons. This is just humor in a serious scandal page. Is this Administration Shameless?

List 3: Clinton Excuses
These are the most popular excuses used by Democrats and the Clintons. A little satire is included. Remember that Bill Clinton claims to have worked together with the investigations by completing all requirements asked of him.
Obviously none of the excuses worked!

What is your favorite excuse? Take a survey

List 4 - Clinton FRIENDS and ASSOCIATES who have given conflicting accounts with the account given by the administration:
    This list contains much from list 1 above.  There is one MAJOR difference though.  This list contains only those who (1) are/were personal friends with Clinton or (2) are/were associates of Clinton (ie. staffers, campaigners, etc.)  Note that these people are supposedly his friends yet all have openly spoken out against Bill Clinton.

    I somehow doubt ALL these people are lying while Bill Clinton is telling the complete truth.

NOTE: These are only the Democrats and Clinton associates that have held an account in conflict with Clintons.  Dozens of others have given accounts as well ( for example Gary Aldrich and Paula Jones).  This list is here merely to show that Clintons own friends and former friends are testifying against him!  More to come soon.

List 5: DEMOCRATS and CLINTON ASSOCIATES who have been critical of the president's scandals at one time or another.  These are Democrats and Clinton associates!  It is not only conservatives that criticize Clinton. It is members of his own party! Wouldn't you be mad if the person you spent the last seven months defending told you he was lying all along and that you were wrong?

Note: THREE living presidents have criticized Clinton's actions: George Bush, Jimmy Carter, and Gerald Ford!

List 6: Criminals:  All these people have served prison sentences for illegal activity in a Clinton scandal.  They either were convicted or pled guilty.  There are over 15 convictions/guilty pleas from Starr's investigation plus several others from other scandal investigations.


Letters to the Editor

North County Times


Media ignored Reagan-Bush scandals
Every time Clinton and Gore blink, the media bash them. But today¹s GOP leadership is as corrupt as Mexico¹s PRI. The Reagan-Bush administrations were thick with scandals. The Iran-Contra scandal, the Savings & Loan scandal, the HUD scandal, the IRS scandal, the Pentagon scandal, the Iraqi-Gate scandal, etc. The cost to taxpayers? Reagan and Bush made Richard Nixon look like a saint, but pressured by media owners, major shareholders and advertisers, reporters largely ignored their malfeasance. Here¹s an example. Special Prosecutor Lawrence Walsh¹s investigators found evidence Reagan and Bush committed numerous, serious felonies related to illegal arms sales to Iran, including violations of the Arms Export Control Act, the Neutrality Act and Separation of Powers statutes, also subversion of the Constitution, subornation of perjury and criminal conspiracy.  Naturally, George Bush pardoned all major Iran-Contra defendants when indictments came down after a $57 million, five-year criminal investigation. The press slept. If Bill Clinton ever displayed such hubris, the media screams for his head would deafen the human race. Clinton and Gore are hated because they fight for ordinary taxpayers. Rich special interests don¹t like that.


Order Reprints of Documented


414 "The CIA, The Mob & The S&L;'s"

The journalist who uncovered the CIA-Mob-S&L; connection discusses his findings with a reporter for the Texas Observer. Enlightening! 

392 "The Real S&L; Scandal: How Bush's Pals Broke the Banks"

Who benefited from the S&L; ripoff? George Bush, his sons, his Houston pals, his campaign manager, his comptroller of the currency, and his landlord, not to mention the Republican Party, the Mafia, and the CIA. Drawing from research done by Pete Brewton, Kwitny shows how George not only looked the other way, but actively intervened to keep failing S&L;'s open. Makes Whitewater seem as naughty as an overloud belch.  

062 "The CIA & Financial Institutions"

Although the Big Media barons don't like to talk about it, the CIA was a huge part of the S&L; debacle. Learn how the Agency helped pull off the greatest bank robbery in history.  

061 "The Banks & The CIA: Cash & Carry"

The authors of Inside Job probe three specific incidents which point to CIA involvement in the S&L; fiasco: (1) The owner of a freight airline that shipped guns to the Middle East and Central America kept this Agency operation afloat with loans (never repaid) from a bank at which he was a director. (2) A Baltimore banker found himself servicing a CIA front company and arranging over $20 million in arms deals before being hung out to dry. (3) Acting as a middleman for arms shipments to Afghanistan, Iran, Iraq, and Central America, a CIA contract pilot helped bilk a Denver bank out of more than $2 million. $

064 "The Brewton Articles"

These articles from The Houston Post are the result of a year-long investigation by reporter Pete Brewton of CIA links to the S&L; scandal. The mainstream press ignored this story. As usual. Brewton connects the dots in the S&L; puzzle, including Neil Bush's Silverado buddies. 

065 "Did the CIA Raid the S&L;'s?"

Investigative reporter Joel Bleifuss examines the involvement of key CIA people in the collapse of S&L;'s and summarizes Pete Brewton's investigations. 

066 "Ripoff Savings & Loan of Colorado"

This fine article focuses primarily on Richard Rossmiller and his involvement in several S&L; failures. Abas also exposes Neil Bush and his suspicious involvement in the failure of the Silverado S&L.; Great info that you can't get anywhere else. 

No fault capitalism

meets lemon socialism

By Sam Smith

Copyright 1990 The Progressive Review

This award-winning article outlined the second S&L; scandal, namely how the bailout was carried out.

In the early days of the savings and loan crisis the joke was that in Texas if you bought a toaster oven they gave you a free S&L.; It turns out not to have been much of a joke. The Resolution Trust Corporation -- the government's misnamed S&L; caretaker that is neither producing a resolution nor inspiring trust -- is engaged in a massive giveaway that may make Teapot Dome look like a demitasse cup.

The RTC is already the nation's largest operator of financial institutions and, according to the New York Times, "quickly becoming the biggest financial institution in the world, the largest single owner of real estate, the largest liquidation company and the largest auction firm." This ungainly monster of America's late empire period was established without meaningful public debate nor with any serious consideration of alternatives.

But official Washington is not alone in its odd indifference to the nature of the S&L; solution. The media --even the op-ed pages and Sunday feature sections -- have largely ignored the question. The topic was not listed on the agenda of The Other Economic Summit -- the progressive alternative to the meeting of economic ministers -- even though TOES gathered this year at virtual ground zero of the crisis: Houston, Texas. And Ralph Nader's major concern seems to be which group of taxpayers will bear the fiscal burden of the scandal.

Cost estimates continue to soar -- as high as $500 billion if you believe congressional analysts or $1.4 trillion (that's right between the GNP of West Germany and Japan, folks) if you accept the calculation of a knowledgeable Wall Street Journal correspondent. But the press, the politicians and even the public interest groups seem far more concerned about how the crisis came about than what we are going to do about it.

One has to admit the former matter is enthralling and appalling. Put rather neatly by one former FBI fraud specialist to the Village Voice, the S&L; crisis is perhaps the largest criminal conspiracy ever created. The FBI currently has some 8,000 cases of S&L; fraud before it, 1300 of them gathering dust for lack of funds to pursue them. Another 13,000 tips haven't even been followed up, according the Newsweek. According to Rep. John Conyers, to date the government has recovered less than 2% of the money lost through criminal fraud in thrift cases, even though fraud was involved in at least three-quarters of S&L; insolvencies.

The sum of money involved is staggering. Newsweek estimates that even at a conservative $250 billion cost, this is an amount that would pay for existing education programs for the next four years; or nearly pay for universal health insurance and long-term care for the next four years; or overhaul the nation's water systems, repair all bridges and have money left over to start fixing highways. There are currently some 40,000 law suits over all this money and the figure is expected to double by year's end.

But recounting neither the sum nor the sin involved leads to a solution. After all, the broad outline of the S&L; scandal have been known for some time yet in its wake the president and the Congress have fashioned an extraordinarily shoddy, dangerous, expensive and corrupt jury rig to correct the matter.

Not only is the government failing to solve the problem, it is creating massive new scandals, inequities and public deficits. Not the least of these is the likelihood that the major beneficiaries of the S&L; bailout will be the very states responsible for it. An S&L; in stodgy Wisconsin, for example, ran an ad boasting, "We dare to be dull." But that will not protect the people of Wisconsin from having to cough up an estimated $592 apiece to bailout such states as Texas where Cleveland State University professor Edward W. Hill estimates the per capita benefit of the bailout will be $4,775.

Among the other clear beneficiaries of the bailout are the quick-rich financiers who, with their soul brothers, helped to create the scandal. Small business and ordinary citizens are not invited to the RTC's extraordinary fire sales. You can't get a catalog and order by mail. Yet The New York Times reported on July 3 that RTC owns 35,908 properties and "though no specific list has been released, the agency's holdings include coal and uranium mines, ranches and pasture lands, 162 golf courses, oil fields, marinas and boat yards, athletic clubs, garages, parking lots and mobile home parks. 84% of the total inventory is residential -- mainly in Texas." Public Citizen notes that the assets include "a buffalo sperm bank, a Nevada bordello, a windmill farm, a share of the Dallas Cowboys, [and] an entire town in Florida."

With a few exceptions -- such as the RTC's grudging, miserly and belated offering of housing to non-profit groups -- the marketing of assets is what they call in the trade a private sale. As a result you may not heard about the satellite auction that will take place in September to sell 98 properties worth $341 million. The government reports that buyers in Japan, Britain and Canada are expressing the most interest. You won't be able to get it on cable.

Billions of dollars worth of assets are being traded at prices that challenge even Crazy Eddie's Emporium in the midst of a recession Memorial Day weekend, -- but for the benefit only a handful of huge corporations and redundantly wealthy financial hustlers. The overhead for these sales is on us.

Playing with matches

We know -- or should know by now -- that the crisis was created in no small part by the gluttony and stupidity of advocates of the so-called free market running rampant through America's fiscal countryside. What you may not realize is how far the government's acquiescence went. For example, until the deregulation of the 1980s, S&Ls; had to have at least 400 shareholders. By 1981, the government had made it possible for there to be only one shareholder and that shareholder didn't have to have any hard equity in the institution. It was also possible for a S&L; to have only one borrower. Further, Congress raised the limit of federal insurance from $40,000 to $100,000 -- and that per account rather than per individual depositor. As Rep. Charles Schumer put it, "The government behaved like a fire insurance company that said to its customers, go ahead, play with matches. We'll cover you if anything goes wrong."

Although some Democrats are smugly blaming the Republicans for the S&L; disaster, the truth is that this bill passed the House 380 to 13 and by a voice vote in the Senate. In another spate of misdirected bi-partisanship, Senator Jake Garn and Rep. Ferdinand St. Germain introduced successful legislation which allowed S&Ls; to get into such new activities as junk bonds, unsecured commercial loans and major real estate projects.

Thanks to recent revelations we now have a better idea of why Congress didn't look after our interests more assiduously. As just one small example, one study has found that S&Ls; gave $45 million to congressional candidates during the past three elections, including more than $1 million to members of current congressional banking committees. The aforementioned St. Germain, according to the newsletter PACs and Lobbies, received nearly $150,000 in campaign contributions, over a six year period. In contrast, S&L; and HUD prober Henry Gonzalez received only $1750 during the same time.

Such facts blast huge holes in arguments that S&Ls; were largely victims of changing world economics, regional recessions and other macro-economic rationalizations. They were, in fact, victims of the avarice of their owners, licensed in their greed by the United States Congress and the executive branch. And the media hardly said a mumblin' word.

It is this same cast of characters that have given us -- or are overseeing -- the so-called S&L; bailout. The same hidden agendas, the same fiscal fast shuffles, the same class of beneficiaries, the same lack of media concern for the import of public actions.

The drama is reminiscent of corporate reorganizations described many decades ago by Thurman Arnold in The Folklore of Capitalism:

"In reality the struggle which attended the `insolvency' of a great organization could be nothing other than a struggle for political control of that organization. The symbols were debts and credits and sales, and men had to plan their practical campaigns in those terms. This created a situation in which the rules of debts and credits became like the platforms in a political campaign. They didn't mean anything. They were full of contradictions. . . The conflict could only be resolved by a public drama where the rules paraded in dress clothes, while a political machine directed the play from behind the scenes."

Behind the public drama of the S&L; solution is the most egregious example to date of no-fault capitalism and lemon socialism. The former is the remarkable principle that -- notwithstanding all the fawning over the "free market economy" -- our largest business institutions are philosophically, fiscally and criminally exempt from the ultimate consequences of laisse faire. The latter is the equally inconsistent principle that to maintain the free market the government is responsible for anything out of which private enterprise can't make a profit. It may not, however, help support this magnificent non sequitur through activities that might actually provide income for the government.

No, the rules of the game are that a major industry is allowed to make whatever mistakes it wishes in pursuit of the holy grail of free enterprise, the costs of which to be fully borne by the taxpayer.

Further, the S&L; solution has the hidden goal of moving America towards increasing financial oligopoly. The government is prepared to guide, assist, regulate and tax to accomplish this goal. This sort of economic policy has been seen before in fully developed form and it has a name: fascism, described by Mussolini biographer Adrian Lyttelton as "the product of the transition from the market capitalism of the independent producer to the organized capitalism of the oligopoly." As Italian fascist economic theorist Alfredo Rocco put it, such an economy "is organized by the producers themselves, under the supreme direction and control of the state."

The media: unskilled and inattentive

What has taken place certainly involves fraud, malfeasance, misfeasance and nonfeasance. But beyond that, what we are experiencing approaches a fiscal coup. Using the not unreasonable cost estimate of $500 billion we are talking about a sum the size of the combined 1986 assets of General Motors, Exxon, Ford, IBM, Mobil, General Electric, ATT, Texaco, Dupont, Chevron, Chrysler Philip Morris and Amoco.

Our last line of defense -- the media -- has been absorbed in the human interest and fraud aspects of the crisis, but woefully unskilled in reporting what is really going on. Reading separate stories about an RTC deal is unnerving. In one S&L; case, The New York Times listed an institution's assets at $1.8 billion, while the Washington Post pegged them at $3.3 billion. Deposits were $2.1 billion in the Times and $5.2 billion in the Post. Remember now, we are talking billions.

In another story, the Times put the government's annual assistance to an S&L; deal at $250 million; the Post called it $250 thousand. The same Post story made it seem the new purchaser had put up $60 million of his own money (of a promised $70 million); the Times explained that the figure was only $1,000. The rest was borrowed.

These examples are not cited to nit-pick but to point out that not even journalists and copy editors can keep the scale of this scandal in perspective.

More significantly, important S&L; stories are relegated to the business pages despite their enormous effect on every American. As a result many readers may have missed, for example, a February 3, 1989, financial page story in the Washington Post. The story, just as the government started rushing pell-mell to dump S&Ls;, began:

"The head of the General Accounting Office yesterday criticized the government's year-end fire sale of 200 failing savings and loans, saying taxpayers would have paid less in the long run if the S&Ls; had been turned over to the government or closed. The Federal Home Loan Bank Board, which oversees and regulates the thrift industry should have held onto the S&Ls; rather than promising an estimated $60 billion in tax breaks to the investors who agreed to buy the ailing institutions."

The GAO said the Federal Home Loan Bank Board weighted its assumptions in favor of sales by not including tax breaks and calculating unrealistic interest rate figures.

The GAO boss, Charles Bowsher, testifying before the Senate, said it would have been cheaper if the regulators had done nothing. Bowsher proposed that insolvent savings and loans be placed in receivership until regulators could figure out whether it would be cheaper to shut them down or merge them into other institutions.

(Although little noted, the administrative costs of the S&L; bailout are phenomenal in themselves. The Times estimates them at $37 billion.)

And this was just the beginning. In a more recent example, the media tended to regard as technical information the news that the Office of Thrift Supervision would temporarily allow the strongest S&Ls; to lend up to 60% of their capital to a single developer for residential construction. This is four times the amount allowed under the bailout law. Most Americans remain unaware that its government is slipping back into practices that created the crisis in the first place. Does the media really believe it is too hard for the average person to understand the risks involved with a financial institution lending the majority of its money to one developer? Or does the media not understand it? Certainly the developers understand what is going on. AP quoted the economist for a homebuilders association as saying, "This will give us some breathing room."

Unasked questions

Among the questions in which the media has generally been disinterested are these:

o How does each of these multi-billion dollar deals compare with what would happen in a normal business transaction? Or even in previous bids for the same company? For example, in a recently-completed sale (which could end up costing taxpayers $2 billion), Greater Western Financial bought Centrust Savings Bank of Miami, including $2.1 billion in deposits and about $1.8 billion in mortgages and consumer loans. GWF, however, left the government with some $5 billion in loans to worry about. GWF is paying $86 million for this largely risk-free investment and it gets to turn back any assets within three months if they turn out to be worth less than expected. On the other hand, before Centrust was seized by the feds, GWF had offered $100 million, or $14 million more, for partial purchase of Centrust -- presumably including both good and bad assets. The difference is striking but neither the Times nor the Post seemed interested in the variance. The now prominent James M. Fail paid almost as much for an institution one-third as large as Centrust. Similarly, in a 1988 non-governmental deal terminated apparently because of environmental problems with some of the assets, Lomas & Nettleson proposed spending over twice as much (again presumably including everything -- good and bad) for Farm & Savings Association of Missouri, an operation half the size of Centrust. Such gross figures in themselves reveal little without much closer examination of the specific situation, but they do raise questions worth answering.

o Are purchasers paying fair price for deposits? A reasonable range, I'm told, might be between 3 to 5 cents on the dollar for a good core deposit. This is why giving away toaster ovens was in vogue for awhile. But what are bailout purchasers paying? Does anyone in the media or Congress care?

o Why are lists of assets for sale not readily available? Why has the media and Congress not demanded more prior information on these sales?

o Why has the media not done its own independent appraisals of various assets to check on the government's work? The rigging of appraisals was one of the causes of the S&L; scandal. A 1985 study by the House consumer and monetary affairs subcommittee said, "Faulty and fraudulent real estate appraisals contributed directly to the insolvency of the nation's financial institutions and have helped cause billions of dollars of losses." There is no reason to believe this manipulation has ceased. As one small appraiser once told me: "There are different types of appraisals. There's an appraisal for an arms-length transaction. There's an appraisal for a deal between friends. There's an appraisal for a divorce settlement. There's an appraisal for insurance purposes and there's an appraisal for estate purposes. Depending on which appraisal you want, that table over there is worth anywhere from $50 to $500." Neither of us at the time had heard of appraisals for a government trying to get a $500 billion monkey off its back and keep campaign contributors happy at the same time.

o Are the government agencies involved in the bailout competent to do the job? Scattered reports from the field should raise far more concern than they have. For example, Rep. Bruce Vento tells of "growing reports of overpaid individuals running RTC-held institutions [and] of officers from failed institutions staying on the government payroll with six figure salaries."

Newsweek says of the RTC: "Many of its 3000 employees have little experience in the field." True enough. The government has advertised for staffers in banking magazines and the like but, as one banker put it, "who are you going to get willing to leave" a stable situation "for an 18-month career?" But if this is the case, what does it say for the underlying approach government has taken towards the S&Ls;? If the approach is premised on staking the future of the worst financial crisis of our history on such people, what does it say about the premise? And why so little concern?

One of the more extraordinary tales to come out of the S&L; crisis is the GAO report that found that the Federal Savings & Loan Insurance Corporation had netted only $57,000 on more than $3 million in S&L; assets. The government spent over $2 million with four firms for communications equipment, inventory and appraisal, moving and warehousing. It turns out all four firms had the same owner and competitive bidding had not been used.

As New Jersey banking analyst James Marks notes, "When there's that much money flowing, there's always someone who figures out a way to stick his finger in and divert some of the flow."

o Who picked the real estate brokers, appraisers and outside lawyers involved in the bailout and how? We're talking $500 million in outside legal fees alone.

o How does the RTC -- and Congress and the media -- determine the difference between bad assets and bad borrowers? The fact that a borrower is going bankrupt does not reveal much about the nature of a particular asset. The media and much of the public seems to have bought the idea that the assets owned by failed S&Ls; are all dogs. This is highly unlikely but helps to justify fire sale prices.

The wrong questions

On the other hand, the questions the media have asked often miss the mark. Because these questions are frequently planted by "official sources," however, they do reveal some of the hidden agenda behind the bailout. Here is an exquisite example from the Times in a recent weekend roundup of the news:

"Does the nation need a specialized industry to finance housing when it now has an efficient mortgage market? Does the nation need 13,000 independent banks and 3000 independent thrifts, or should institutions be allowed to consolidate across state lines, which would also enable them to spread their risks by diversifying their sources of loans and deposits? Most important is it time to consider changing the system for insuring deposits so that there is less of an incentive to gamble with taxpayer's money?"

The clue to the source of such queries is the phrase "efficient mortgage market," one of those delightful terms of art used by economists and financiers which would never be used by the average homeowner or wistful would-be purchaser. The latter would be more incline to favor words like "gouging."

In fact, the mortgage market is efficient only to the extent that it has made some people and some institutions a lot of money. It has also developed in such a way that the average age at which someone can afford their first home is rising rapidly, people are paying an exorbitant percentage of their income to finance their homes, and the former stability of the home mortgage has been increasingly replaced by such economic Russian roulette techniques as variable rate mortgages.

Contrary to the image being created by the media, the banking industry and its political toadies, the need for institutions to carry out the historic functions of a savings and loan is enormous and there is absolutely no way a headlong rush towards further oligopoly in the financial world is going to help meet that need.

Yet in the June 9 Washington Post an editorial stated flatly: "It's time, first of all, to abolish S&Ls.;" The chair of the Council of Mutual Savings Institutions, which represents the over half of all S&Ls; that are mutually owned and locally managed and which have generally avoided scandal and bankruptcy, noted in a letter to the Post that it was the capital stock, publicly-owned institutions that were in trouble and added, without too much exaggeration:

"Mutual savings institutions have made this a nation of homeowners. They are the nation's primary home mortgage lenders. Commercial banks enter the home mortgage market only when interest rates are high; thrifts are in this market through all economic cycles."

But not if the Washington Post has its way.

Further, while obvious excesses in federal insurance that aid only large fiscal hustlers need to be ended, there is a clear danger that the current crisis will be used as an excuse to undercut the immensely valuable 60-year-old principle of federal deposit insurance as it applies to the ordinary citizen. We can expect little help from the Times in this matter.

On the other hand, in recent weeks the Times has gotten on aspects of the S&L; case with a vengeance, running circles around the Post, On July 8 it even elevated its coverage to lead story status on the front page. The legwork had been done not by the press, however, but by an investigator hired by a Senate subcommittee led by Senator Howard Metzenbaum. The deal was no secret. Phoenix newspaper coverage at the time raised enough questions to make a prudent politician or regulator pause. But what wasn't apparent from those early stories, however, was made clear in the piece by Jeff Gerth:

"An Arizona insurance executive with a history of legal and regulatory problems was allowed to buy 15 insolvent Texas savings and loan associations with borrowed money in 1988 and was promised $1.85 billion in federal subsidies in what Congressional investigators call the worst abuse found in the Federal bailout program."

According to the Times, James M. Fail had paid $1000 of his own money and borrowed $70 million for the deal establishing Bluebonnet Savings. And then: "Last year, with the help of the first $250 million of Federal payments pledged over 10 years, Bluebonnet was the most profitable large savings and loan in the country." It turns out that this profit was largely due to the federal payment, Bluebonnet having only made four loans in the period -- one to an ex-Bush aide.

Said Metzenbaum: "In all my years in public office, I have never seen such an abandonment of public responsibility as in the S&L; deals of 1988, and the Bluebonnet deal is an abomination, the worst case we have found."

Keep in mind that we're no longer talking about the S&L; crisis itself, but with the so-called solution, as applied less than two years ago.

The story of a century

In the first decade of this century, in the wake of the San Francisco earthquake, as other bankers helplessly watched their money disappear in fire and rubble, Amadeo Peter Giannini of the Bank of Italy walked 18 miles from his home to the bank where he retrieved some $80,000 in gold and silver from the vaults, loaded it on a wagon and made his way to his brother's house in the hills. There he opened for business, loaning the money to San Franciscans so they could rebuild their homes and businesses. He gambled that his action would encourage others to deposit funds they had been hoarding so he could loan still more. It worked and on this shaky foundation there arose the Bank of America, later to become the largest banking house in the world.

In the last decade of this century, in the wake of another great disaster, America has reversed the parable. The money of the taxpayers, needed for their homes and businesses, is being loaded on the wagons of the state for deposit in the vaults of those few who have the means, the political power and the gall to profit from the rubble of the fiscal crisis that has struck the S&L; industry.

And America, its politicians, its captains of industry, its media, can think of little else to do about it except tacitly sanction the continued looting in the wake of the great capitalist riot of the 1980s

FDIC Global Navigation Links
The S&L; Crisis: A Chrono-Bibliography
General Books and Articles   A basic bibliography to provide an overview of the S&L; Crisis.
Causes of the S&L; Crisis   Background materials for understanding what led to the S&L; Crisis.
Charles Keating and Lincoln Savings and Loan   Details on one of the costliest S&L; failures that involved 5 U.S. Senators.
Criminal Activity Associated with S&L; Failures   The goods on specific criminal investigations of S&L; owners and directors.
Depository Institutions Deregulation and Monetary Control Act of 1980   Details on the 1980 law (DIDMCA) that eased the distinctions among savings institutions.
Deregulation of the S&Ls;   Working papers and analysis covering the deregulation of the S&L; industry that led to the crisis.
Financial Institutions Reform Recovery and Enforcement Act (FIRREA)   The law enacted in August, 1989, to bail out the S&L; crisis and create the Resolution Trust Corporation.
Garn - St. Germain Depository Institutions Act of 1982   Analyses of the 1982 law that allowed S&L;'s to diversify their activities with the view of increasing profits.
Interest Rate Vulnerability   Bibliography for understanding S&L; interest rates, and S&L; vulnerability during this time period.
Southwest Plan   The plan to consolidate and package insolvent Texas S&Ls; and sell them to the highest bidder.
State Deposit Insurance Funds - Ohio and Maryland   S&L; failures in Ohio and Maryland and the end of the State Deposit Insurance Funds/
Taxation and Accounting bibliography   Understanding the tax and accounting rules for S&L;'s
1966-1979   Market interest rates fluctuate with increasing intensity and S&Ls; experience difficulty with each interest rate rise. Interest rate ceilings prevent S&Ls; from paying competitive interest rates on deposits. Thus, every time the market interest rates rise, substantial amounts of funds are withdrawn by consumers for placement in instruments with higher rates of return. This process of deposit withdrawal ("disintermediation") and the subsequent deposit influx when rates rise ("reintermediation") leaves S&Ls; highly vulnerable. Concurrently, money market funds become a source of competition for S&L; deposits. S&Ls; are additionally restricted by not being allowed to enter into business other than accepting deposits and granting home mortgage loans.

1967--State of Texas approves major liberalization of S&L; powers. Property development loans of up to 50% of net worth are allowed.

1972--Hunt Commission recommendations would have created federal savings banks to replace S&Ls.; The banks would have had additional authority to make commercial loans and invest in commercial paper.

1973--FINE Study would have granted same powers for S&Ls; as for banks, including checking accounts. Also recommends consolidation of the regulators. Interest rate insurance was recommended if S&Ls; are to remain primarily involved in housing finance.

1978--Financial Institutions Regulatory and Interest Rate Control Act of 1978 enacted. Weak version of previous recommendations. Allows S&Ls; to invest up 5% of assets in each of land development, construction, and education loans.

1979--Doubling of oil prices. Inflation moves into double digits for second time in five years.

1980-1982   Statutory and regulatory changes give the S&L; industry new powers in the hopes of their entering new areas of business and subsequently returning to profitability. For the first time, the government approves measures intended to increase S&L; profits as opposed to promoting housing and homeownership.

March, 1980--Depository Institutions Deregulation and Monetary Control Act (DIDMCA) enacted. The law is a Carter Administration initiative aimed at eliminating many of the distinctions among different types of depository institutions and ultimately removing interest rate ceiling on deposit accounts. Authority for federal S&Ls; to make ADC (acquisition, development, construction) loans is expanded. Deposit insurance limit raised to $100,000 from $40,000. This last provision is added without debate.

November, 1980--Federal Home Loan Bank Board reduces net worth requirement for insured S&Ls; from 5 to 4 percent of total deposits. Bank Board also removes limits on the amounts of brokered deposits an S&L; can hold.

August, 1981--Tax Reform Act of 1981 enacted. Provides powerful tax incentives for real-estate investment by individuals. This legislation helps create a "boom" in real estate and contributes to over-building.

September, 1981--Federal Home Loan Bank Board permits troubled S&Ls; to issue "income capital certificates" that are purchased by FSLIC and included as capital. Rather than showing that an institution is insolvent, the certificates make it appear solvent.

1982-1985   Reductions in the Bank Board's regulatory and supervisory staff. In 1983, a starting S&L; examiner is paid $14,000 a year. The average examiner has only two years on the job. Examiner salaries are paid through OMB, not the Bank Board. During this period of supervisory and examination retraction, industry growth increases. Industry assets increase by 56% between 1982 and 1985. 40 Texas S&Ls; triple in size between 1982 and 1986; many of them grow by 100% each year. California S&Ls; follow a similar pattern.

January, 1982--Federal Home Loan Bank Board reduces net worth requirement for insured S&Ls; from 4 to 3 percent of total deposits. Additionally, S&Ls; are allowed to meet the low net worth standard not in terms of generally accepted accounting principles (GAAP), but of even more liberal regulatory accounting principles (RAP).

April, 1982--Bank Board eliminates restrictions on minimum numbers of S&L; stock holders. Previously, it required at least 400 stock holders of which at least 125 had to be from "local community", with no individual owning more than 10% of stock and no "controlling group" more than 25%. Bank Board's new ownership regulation would allow a single owner. Purchases of S&Ls; were made easier by allowing buyers to put up land and other real estate, as opposed to cash.

December, 1982--Garn - St. Germain Depository Institutions Act of 1982 enacted. This Reagan Administration initiative is designed to complete the process of giving expanded powers to federally chartered S&Ls; and enables them to diversify their activities with the view of increasing profits. Major provisions include: elimination of deposit interest rate ceilings; elimination of the previous statutory limit on loan to value ratio; and expansion of the asset powers of federal S&Ls; by permitting up to 40% of assets in commercial mortgages, up to 30% of assets in consumer loans, up to 10% of assets in commercial loans, and up to 10% of assets in commercial leases.

December, 1982--In response to the massive defections of state chartered S&Ls; to the federal system, Nolan Bill passes in California. Allows California-chartered S&Ls; to invest 100% of deposits in any kind of venture. Similar plans adopted in Texas and Florida.

1983--Lower market interest rates return many S&Ls; to health. 35% of institutions, however, still sustain losses. 9% of all S&Ls; (representing 10% of industry assets) are insolvent by GAAP standards.

March, 1983--Edwin Gray becomes Chairman of the Federal Home Loan Bank Board. Beginning in 1984 and continuing throughout his tenure, regulatory and supervisory measures passed by the Bank Board begin the reversing of deregulation.

November, 1983--Bank Board raises net worth requirement for newly chartered S&Ls; to 7%.

March, 1984--Failure of Empire Savings of Mesquite, TX. "Land flips" and other criminal activities are a pattern at Empire. This failure would eventually cost the taxpayers approximately $300 million.

April, 1984--Bank Board moves jointly with the FDIC to attempt to eliminate deposit insurance for brokered deposits. Federal court rejects this attempt in mid-1984 as overstepping statutory limits.

July, 1984--Bank Board requires S&L; management to adopt policies and procedures for managing interest rate risk.

January, 1985--Bank Board limits the amount of brokered deposits to 5% of deposits at FSLIC insured institutions failing to meet their net worth requirements. Bank Board also limits direct investment (equity securities, real estate, service corporations, and operating subsidiaries) to the greater of 10% of assets or twice the S&L;'s net worth, provided the institution meets regulatory net worth.

March, 1985--Ohio bank holiday. Anticipated failure of Home State Savings Bank of Cincinnati, OH and possible depletion of Ohio state deposit insurance fund cause Governor Celeste to close Ohio S&Ls;. Eventually, those that can qualify for federal deposit insurance are allowed to reopen.

May, 1985--S&L; failures in Maryland eventually cause loss to state deposit insurance fund and Maryland taxpayers of $185 million. Ohio and Maryland S&L; failures helped kill state deposit insurance funds.

July, 1985--Chairman Gray begins transfer of federal examiners to the twelve regional Federal Home Loan Banks so that they are no longer overseen by OMB and their salaries are paid directly by the Bank Board system.

August, 1985--Only $4.6 billion in FSLIC insurance fund. Chairman Gray tries to gain support for recapitalizing FSLIC on Capitol Hill. In 1986, GAO estimates the loss to the insurance fund to be around $20 billion.

December, 1985--Bank Board allows S&L; examiners to "classify" questionable loans and other assets for the purpose of requiring loan loss reserves.

1986-1989   Compounding of losses as insolvent institutions are allowed to remain open and grow, allowing ever increasing losses to accumulate.

August, 1986--Bank Board raises net worth standard gradually to 6% with up to 2% points offset for reduced interest rate-risk.

1987--Losses at Texas S&Ls; comprise more than one-half of all S&L; losses nationwide, and of the 20 largest losses, 14 are in Texas. Texas economy in major recession: crude oil prices fall by nearly 50%, office vacancy is over 30%, and real estate prices collapse.

January, 1987--GAO declares FSLIC fund insolvent by at least $3.8 billion. Recapitalization has stalled on Capitol Hill until now by claims of powerful S&L; lobbyists that Bank Board regulations are too harsh and arbitrary.

February, 1987--Bank Board requires prior supervisory approval for S&Ls; making direct investment in excess of 2.5 times their tangible capital.

April, 1987--Edwin Gray ends his term as chairman of Federal Home Loan Bank Board in June. Before his departure, he is summoned to the office of Sen. Dennis DeConcini. DeConcini, with four other Senators (John McCain, Alan Cranston, John Glenn, and Donald Riegle) question Gray about the appropriateness of Bank Board investigations into Charles Keating's Lincoln Savings and Loan. All five senators, who have received campaign contributions from Keating, would become known as the "Keating Five". The subsequent Lincoln failure is estimated to have cost the taxpayers over $2 billion.

May, 1987--Bank Board begins phasing out the remains of the liberal RAP accounting standards. S&Ls; must conform to GAAP accounting standards, as banks do. Effective date of this rule postponed by new Chairman of the Federal Home Loan Bank Board, M. Danny Wall, to 1/1/1989.

August, 1987--Competitive Equality Banking Act of 1987 enacted. The Act authorizes $10.8 billion recapitalization of the FSLIC with only $3.75 billion authorized in any 12-month period. Also contains forbearance measures designed to postpone or prevent S&L; closures.

February, 1988--Bank Board introduces the "Southwest Plan" to consolidate and package insolvent Texas S&Ls; and sell them to the highest bidder. The strategy is to resolve insolvencies quickly while conserving scarce cash for FSLIC. The Bank Board uses a number of strategies to pay for the difference between assets and liabilities of the failed institutions: FSLIC notes, tax incentives, and income, capital value and yield guarantees. The Bank Board disposes of 205 S&Ls; through the Southwest Plan with assets of $101 billion.

November, 1988--George Bush elected President. S&L; problem not part of election debate.

1989--President Bush unveils S&L; bailout plan in February. In August, Financial Institutions Reform Recovery and Enforcement Act (FIRREA). FIRREA abolishes the Federal Home Loan Bank Board and FSLIC, switches S&L; regulation to newly created Office of Thrift Supervision. Deposit insurance function shifted to the FDIC. A new entity, the Resolution Trust Corporation is created to resolve the insolvent S&Ls.;

Other major provisions of FIRREA include: $50 billion of new borrowing authority, with most financed from general revenues and the industry; meaningful net worth requirements and regulation by the OTS and FDIC; allocation funds to the Justice Department to help finance prosecution of S&L; crimes. Additional bank crime legislation the next year (i.e., the Crime Control Act of 1990) mandates a study by the National Commission on Financial Institution Reform, Recovery and Enforcement to uncover the causes of the S&L; crisis, and come up with recommendations to prevent future debacles.


Last Updated 6/6/99
Sitemap | Search | Help | Home
FDIC Home FDIC Help FDIC Search FDIC Sitemap



The Family That Preys Together

From Issue No. 41, Summer, 1992
by Jack Colhoun

GEORGE JR.'S BCCI CONNECTION "This is an incredible deal, unbelievable for this small company," energy analyst Charles Strain told Forbes magazine, describing the oil production sharing agreement the Harken Energy Corporation signed in January 1990 with Bahrain.

Under the terms of the deal, Harken was given the exclusive right to explore for gas and oil off the shores of the Gulf island nation. If gas or oil were found in waters near two of the world's largest gas and oil fields, Harken would have exclusive marketing and transportation rights for the energy resources. Truly an "incredible deal" for a company that had never drilled an offshore well.

Strain failed to point out, however, the one fact that puts the Harken deal in focus: George Bush, Jr., the eldest son of George and Barbara Bush of 1600 Pennsylvania Avenue, Washington, DC, is a member of Harken's board of directors, a consultant, and a stockholder in the Texas-based company. In light of this connection, the deal makes more sense. The involvement of Junior-George Walker Bush's childhood nickname-with Harken is a walking conflict of interest. His relationship to President Bush, rather than any business acumen, made him a valuable asset for Harken, the Republican Party benefactors, Middle East oil sheikhs and covert operators who played a part in Harken's Bahrain deal.

In fact, Junior's track record as an oilman is pretty dismal. He began his career in Midland, Texas, in the mid-1970s when he founded Arbusto Energy, Inc. When oil prices dropped in the early 1980s, Arbusto fell upon hard times. Junior was only rescued from business failure when his company was purchased by Spectrum 7 Energy Corporation, a small oil firm owned by William DeWitt and Mercer Reynolds. As part of the September 1984 deal, Bush became Spectrum 7's president and was given a 13.6 percent share in the company's stock. Oil prices stayed low and within two years, Spectrum 7 was in trouble.

In the six months before Spectrum 7 was acquired by Harken in 1986, it had lost $400,000. In the buyout deal, George "Jr." and his partners were given more than $2 million worth of Harken stock for the 180-well operation. Made a director and hired as a "consultant" to Harken, Junior received another $600,000 of Harken stock, and has been paid between $42,000 and $120,000 a year since 1986.

Junior's value to Harken soon became apparent when the company needed an infusion of cash in the spring of 1987. Junior and other Harken officials met with Jackson Stephens, head of Stephens, Inc., a large investment bank in Little Rock, Arkansas (Stephens made a $100,000 contribution to the Reagan-Bush campaign in 1980 and gave another $100,000 to the Bush dinner committee in 1990.)

In 1987, Stephens made arrangements with Union Bank of Switzerland (UBS) to provide $25 million to Harken in return for a stock interest in Harken. As part of the Stephens-brokered deal, Sheikh Abdullah Bakhsh, a Saudi real estate tycoon and financier, joined Harken's board as a major investor. *5 Stephens, UBS, and Bakhsh each have ties to the scandal-ridden Bank of Credit and Commerce International (BCCI).

It was Stephens who suggested in the late 1970s that BCCI purchase what became First American Bankshares in Washington, D.C. BCCI later acquired First American's predecessor, Financial General Bankshares. At the time of the Harken investment, UBS was a joint-venture partner with BCCI in a bank in Geneva, Switzerland. Bakhsh has been an investment partner in Saudi Arabia with Gaith Pharoan, identified by the U.S. Federal Reserve Board as a "front man" for BCCI's secret acquisitions of U.S. banks.

Stephens, Inc. played a role in the Harken deal with Bahrain as well. Former Stephens bankers David and Mike Edwards contacted Michael Ameen, the former chief of Mobil Oil's Middle East operations, when Bahrain broke off 1989 talks with Amoco for a gas and oil exploration contract. The Edwardses recommended Harken for the job and urged Ameen to get in touch with Bahrain, which he did.

"In the midst of Harken's talks with Bahrain, Ameen- simultaneously working as a State Department consultant-briefed the incoming U.S. ambassador in Bahrain, Charles Hostler," the Wall Street Journal noted, adding that Hostler, a San Diego real estate investor, was a $100,000 contributor to the Republican Party. Hostler claimed he never discussed Harken with the Bahrainis.

Harken lacked sufficient financing to explore off the coast of Bahrain so it brought in Bass Enterprises Production Company of Fort Worth, Texas, as a partner. The Bass family contributed more than $200,000 to the Republican Party in the late 1980s and early 1990s. *9 On June 22, 1990, George Jr. sold two-thirds of his Harken stock for $848,560-a cool 200 percent profit. The move was well timed. One week after Junior sold his stock, Harken announced a $23.2 million loss in quarterly earnings and Harken stock dropped sharply, losing 60 percent of its value over the next six months. On August 2, 1990, Iraqi troops moved into Kuwait and 541,000 U.S. forces were deployed to the Gulf.

"There is substantial evidence to suggest that Bush knew Harken was in dire straits in the weeks before he sold the $848,560 of Harken stock," asserted U.S. News & World Report. The magazine noted Harken appointed Junior to a "fairness committee" to study possible economic restructuring of the company. Junior worked closely with financial advisers from Smith Barney, Harris Upham & Company, who concluded "only drastic action could save Harken."

George "Jr." also violated Securities and Exchange Commission (SEC) regulations which require "insider" stock deals to be reported promptly, in Bush's case by July 10, 1990. He didn't file the stock sale with the SEC until the first week of March 1991.

Meanwhile, a cloak-and-dagger aura surrounds Junior's business dealings. James Bath, a Texas entrepreneur who invested $50,000 in Arbusto Energy, may be a business cutout for the CIA. Bath also acted as an investment "adviser" to Saudi Arabian oil sheikhs, linked to the outlaw BCCI, which also has ties to the CIA.

Bill White, a former Bath partner, claims that Bath has "national security" connections. White, a United States Naval Academy graduate and former fighter pilot, charges that Bath developed a network of off-shore companies to camouflage the movement of money and aircraft between Texas and the Middle East, especially Saudi Arabia.

Alan Quasha, a Harken director and former chair of the company, is the son of attorney William Quasha, who defended figures in the Nugan Hand Bank scandal in Australia. Closed in 1980, Nugan Hand was not only tied to drug-money laundering and U.S. intelligence and mi- litary circles, but also to the CIA's covert backing for a "constitutional coup" in Australia that caused the fall of Prime Minister Gough Whitlam.

The Harken deal with Bahrain raises another troubling question: Did the Bahrainis and the BCCI-linked Saudi oil sheikhs use the production sharing agreement with Harken to curry favor with the Bush administration and influence U.S. policy in the Middle East? Talat Othman's sudden rise to prominence in Bush administration foreign policy circles is a case in point. Othman, who sits on the Harken board as Sheikh Bakhsh's representative, didn't have access to President Bush before Harken's Bahrain agreement. "But since August 1990, the Palestinian-born Chicago investor has attended three White House meetings with President Bush to discuss Middle East policy," the Wall Street Journal pointed out. "His name was added by the White House to a select list of 15 Arab-Americans chosen to meet with President Bush, [then White House Chief of Staff John] Sununu and National Security Adviser Brent Scowcroft in the White House two days after Iraq's August 1990 invasion of Kuwait."

Prescott Bush, Jr., the president's older brother, also has a knack for nailing down "incredible deal[s]." Prescott took advantage of his brother's first presidential visit abroad in February 1989 to schedule a business trip to the same countries-China, Japan and South Korea.

Prescott arrived in Tokyo February 14, 1989, ten days before President Bush's stop in Japan, to drum up business for Prescott Bush Resources Ltd., a real estate and development consulting company. Prescott said he was dealing with four Japanese companies wanting to do business in the U.S.

From Japan, Prescott went to China, where he had a joint partnership with Akoi Corporation to develop an $18 million golf course and resort near Shanghai. Prescott had introduced the Tokyo-based Akoi to Chinese officials in 1988. With a 30 percent stake in the project, Prescott used his China connections to pave the way for capital-rich Akoi. Akoi had run into business obstacles in China because of lingering Chinese resentment over Japan's brutal occupation of China in the 1930s and 1940s.

Some of Prescott's most controversial business deals have been with Asset Management International Financing & Settlement Ltd., a Wall Street investment firm which has been in bankruptcy proceedings since fall 1991. Prescott was hired by Asset Management, which paid him a $250,000 fee for consulting in its joint venture with China to set up its internal communications network. Asset Management enlisted Prescott's services soon after President Bush imposed economic sanctions in June 1989 in response to Beijing's brutal crackdown on anti-government demonstrators in Tienanmen Square.

Under the sanctions, United States export licenses were suspended for $300 million worth of Hughes Aircraft satellites, a key component of Asset Management's joint venture with the Chinese government. The satellites would beam television programming to broadcasters in China and provide telecommunications links for the country's far-flung provinces. In November 1989, Congress passed additional sanctions specifically barring the export of U.S. satellites to China unless the president found the sale "in the national interest."

On December 19, 1989, President Bush lifted the sanctions that blocked the satellite deal, citing "the national interest." Two months earlier, the Bush administration had granted Hughes Aircraft "preliminary licenses" to exchange data with Chinese officials to ensure that the satellites met the technical specifications of the Long March rockets which would launch them into space.

Meanwhile, Prescott was hard at work in the summer of 1989 as middleman in the takeover of Asset Management by West Tsusho, a Tokyo-based investment firm linked to one of Japan's biggest mob syndicates. Prescott, as head of Prescott Bush & Co., received a $250,000 "finder's fee" from West Tsusho when the deal was closed and was promised an annual retainer of $250,000 over the next three years as a "consultant." Asset Management, however, went bankrupt in March 1991. In May 1992, West Tsusho filed a $2.5 million lawsuit against Prescott claiming that he reneged on his promise to protect the mob-linked firm's $5 million investment in Asset Management.

According to Japanese police, West Tsusho is controlled by the Inagawakai branch of the Yakuza, the Japanese equivalent of the Mafia crime syndicate. By the mid-1980s, the Yakuza were buying up real estate and investments in Japan and overseas to launder their ill-gotten profits from drug sales, prostitution, gambling and extortion. Yakuza's annual income is estimated at $10 billion.

Like George Jr., Prescott combined business with secret operations. He offered his services to the covert operations of the Reagan-Bush campaign in 1980, and later to the Reagan administration. A September 3, 1980, letter from Prescott to James Baker indicates Prescott was part of the Reagan-Bush campaign's secret surveillance of the Carter administration's efforts to obtain release of U.S. hostages held in Iran. Prior to inauguration, the Reagan-Bush campaign recruited retired military and intelligence officers to monitor activities of the CIA, the Defense Department, the National Security Council, the State Department, and the White House. This operation later became known as the "October Surprise."

"Herb Cohen-the guy that offered help on the Iranian hostage situation-called me yesterday afternoon," Prescott wrote in a letter designated "PRIVATE AND CONFIDENTIAL." "Herb has a couple of reliable sources on the National Security Council, about whom the [Carter] administration does not know, who can keep him posted on developments."

Prescott continued, "He cannot come out now and say that Carter is going to do something on Iran in October because he said everything is a contingency plan that is loose and fluid from day to day.... Herb says, however, that if he and others in the administration who really care about the country and cannot stand to see Carter playing politics with the hostages, see Carter making a move to politicize the release of the hostages, he and they will come out at that time and expose him."

Prescott's covert associations continued while his younger brother was vice president. He appears to have aided the Reagan administration's clandestine support of the Nicaraguan Contras. In the 1980s, he served on the advisory board of Americares, the U.S.-based relief organization with ties to prominent right-wing Republicans and the intelligence community. Bush's other son, Marvin, also helped the family's pet charity and accompanied a flight of medical supplies to Nicaragua three days after Chamorro's inauguration. An undisclosed amount of the $680,000 in Americares aid to Honduras was delivered to Nicaraguan Miskito Indian guerrillas. Based in Honduras, they were aligned with the CIA-funded Contras, according to Roberto Ale- jos, a Guatemalan sugar and coffee grower who coordinated the Americares project in Honduras. In 1960, Alejos had permitted the CIA to use his plantations to train right-wing Cubans in preparation for the Bay of Pigs invasion of Cuba.

In 1985 and 1986, after Congress cut off U.S. aid to the Contras, Americares donated more than $100,000 worth of newsprint to the pro-Contra newspaper La Prensa in Managua. Americares supplied $291,383 in food and medicine and $5,750 in cash to Mario Calero, New Orleans-based quartermaster and arms purchaser for the Contras, and brother of Contra leader Adolfo Calero. In this same period, groups associated with Lt. Col. Oliver North's off-the-shelf Contra arms network provided covert support for La Prensa.

Jeb: Liaison to Anti-Castro Right
George Herbert Walker Bush's second eldest son, John Ellis or Jeb, was also linked to clandestine schemes in support of the Contras. Soon after congressional prohibition in late 1984, Jeb helped put a right-wing Guatemalan politician, Dr. Mario Castejon, in touch with Oliver North. Jeb acted as the Reagan administration's unofficial link with the Contras and Nicaraguan exiles in Miami.

Jeb was contacted in February 1985 by a friend of Castejon, who gave him a letter from Castejon to be passed on to then Vice President Bush. In his letter Castejon, a pediatrician and later an unsuccessful National Conservative Party presidential candidate, requested a meeting with George Bush to discuss a proposed medical aid project for the Contras. Jeb forwarded the letter to his father. In a March 3, 1985, letter, Vice President Bush expressed interest in Castejon's proposal to create an international medical brigade.

"I might suggest, if you are willing, that you consider meeting with Lt. Colonel Oliver North of the President's National Security Council Staff at a time that would be convenient for you," Bush wrote. "My staff has been in contact with Lt. Col. North concerning your projects and I know that he would be most happy to see you. You may feel free to make arrangements to see Lt. Colonel North, if you wish, by corresponding directly with him at the White House or by contacting Philip Hughes of my staff."

Castejon later met with North in the White House, where he also saw President Ronald Reagan. When Castejon returned to Washington for a second visit, he was introduced to members of North's secret Contra support network, including retired Maj. Gen. John Sing- laub and Contra leader Adolfo Calero. Castejon also met with a group of doctors working with Rob Owen, North's liaison with the Contras.

"He [Castejon] was offering us a pipeline into Guatemala," said Henry Whaley, a former arms dealer who said he was asked by his intelligence community connections to help Castejon. Whaley was optimistic about opening a new shipping route to the Contras through Guatemala. "If you can move Band-Aids," he reportedly said, "you can move bullets."

With Castejon, Whaley prepared a proposal to the State Department for the purchase of medical supplies for the Contras from the Department's newly established Nicaraguan Humanitarian Assistance Office. The document included requests for mobile field hospitals and light aircraft to evacuate wounded Contra guerrillas. Congress approved $27 million in "humanitarian" aid to the Contras in 1985. The Castejon proposal was hand-delivered to TGS International Limited in the Virginia suburbs of Washington. Whaley said he sent the report to TGS so it would be "quietly" forwarded to the CIA. TGS International is owned by Ted Shackley, who was CIA Associate Deputy Director of Operations when Bush Sr. headed the Agency in 1976-77.

Jeb had another Contra connection in his involvement with Miguel Recarey, Jr., a right-wing Cuban who headed the International Medical Centers (IMC) in Miami. In 1985 and 1986, Recarey and his associates gave more than $25,000 in contributions to political action committees controlled by then Vice President Bush. In 1986, Recarey hired Jeb, a real estate developer, to find a new headquarters for IMC. Jeb was paid a $75,000 fee, even though he never located a new building.

In September 1984, two months after IMC's $2,000 contribution to the Dade County Republican Party, which was headed by Jeb, the vice president's son contacted several top HHS (Department of Health and Human Services) officials on behalf of IMC. "Contrary to rumors, [Recarey] was a good community citizen and a good supporter of the Republican Party," one official of the HHC remembered Jeb telling him in late 1984. Jeb successfully sought an HHS waiver of a rule so that IMC could receive more than 50 percent of its income from Medicare.30

Leon Weinstein, an HHS Medicare fraud inspector, worked on an audit of IMC in 1986; he has charged that IMC used Medicare funds to treat wounded Contras at its hospital. *31 The transaction was arranged by IMC official José Basulto, a right-wing Cuban trained by the CIA, who arranged for Contras to receive treatment in Miami. Basulto was praised for his commitment by Felix Rodriguez: "He has been active for a decade in supporting the Nicaraguan freedom fighters ever since the Sandinistas took power, and is constantly organizing Contra support among Miami's Cuban community. He has even been to Contra camps in Central America, helping to dispense humanitarian aid."

At the same time as Recarey was providing medical assistance to the Contras, he was embezzling Medicare funds. IMC, one of the largest health maintenance organizations in the United States, received $30 million a month for its Medicare patients, clearing $1 billion in federal monies from 1981 to 1987. While he headed IMC, Recarey's personal wealth jumped from $1 million to $100 million, U.S. investigators believe.

"IMC is the classic case of embezzlement of government funds," according to Robert Teich, the head of the Drug Enforcement Administration's Office on Labor Racketeering in Miami. Reich described IMC's skimming Medicare funds as a "bust-out" where money was "drained out the back door." A Florida state investigator concluded in a 1982 report that some federal funds IMC received "are being put in banks outside the country."

Recarey's links to the Mafia also raised eyebrows in Washington. "As far back as the 1960s, he had ties with reputed racketeers who had operated out of pre-Castro Cuba and who later forged an anti-Castro alliance with the CIA," the Wall Street Journal reported. The Journal added that the late Santos Trafficante, Jr., the Mafia boss of Florida, "helped out when Recarey needed business financing." Trafficante, a major drug trafficker, joined a failed CIA effort to assassinate Cuban President Fidel Castro in the early 1960s.

Recarey's access to Republican circles was probably one reason he was able to rip-off U.S. tax dollars for so long. He hired former Reagan aide Lyn Nofziger, the public relations firm Black, Manafort, Stone and Kelly, which was close to the Reagan White House, and attorney John Sears, a former Reagan campaign manager, to look out for his interests in Washington. Recarey fled the United States in 1987 to avoid a federal indictment for racketeering and defrauding the U.S. government. The Bush administration has made no effort to extradite him from Venezuela where he is currently living.

Jeb Bush has also been linked to Leonel Martinez, a Miami-based right-wing Cuban-American drug trafficker. Martinez, who was linked to Contra dissident Eden Pastora, was involved in efforts to smuggle more than 3,000 pounds of cocaine into Miami in 1985-86. He was arrested in 1989 and later convicted for bringing 300 kilos of cocaine into the U.S. He also reportedly arranged for the delivery of two helicopters, arms, ammunition, and clothing to Pasto- ra's Costa Rica-based Contras.

Federal prosecutors in Miami have a photograph of Jeb and Martinez shaking hands but won't release the photo to the public. Whether Jeb was aware of Martinez's drug trafficking activities is not known, but it is known that Leonel and his wife Margarita made a $2,200 contribution to the Dade County Republican Party four months after Jeb became the chair of the local GOP.

It is also known that Martinez wrote $5,000 checks to then Vice President Bush's Fund for America's Future in both December 1985 and July 1986 and made a $2,000 contribution to the Bush for President campaign in October 1987.

Martinez's construction company gave $6,000 in October 1986 to Bob Martinez (no relation), the GOP candidate for governor in Florida; he was governor from 1987 to 1991. At that time, Vice President Bush was serving as head of the South Florida Drug Task Force and later as chair of the National Narcotics Interdiction System, both set up to stem the flow of drugs into the U.S. While Bush was drug czar, the volume of cocaine smuggled into the U.S. tripled.

President Bush later appointed Bob Martinez in 1991 head of the U.S. Office of National Drug Control Policy- the drug czar to succeed the controversial William Bennett.

In 1988, Jeb was mentioned in a deposition taken by a Senate Foreign Relations subcommittee, chaired by Sen. John Kerry (D-Mass.), which was investigating drug money laundering operations in the U.S.

"I saw Jeb Bush two or three times over there with [Abdur] Sakhia," stated Aziz Rehman, a junior BCCI-Miami official in the 1980s. "This was all part of the bank's trying to cultivate public officials and prominent individuals." *38 Rehman said BCCI's practice was to "bribe" government officials in the United States.

"Jeb Bush, V.P. George Bush's son," Sakhia noted in a 1986 BCCI document, was a "name…to be remembered."

Most of Rehman's testimony focused on his role in BCCI-Miami's money laundering operation. Rehman said it was his job, in the mid-1980s, to chauffeur and entertain BCCI-Miami's big clients when they came to the city from the Caribbean and Latin America. Rehman described how he deposited large amounts of cash for these clients, ranging from $100,000 to $2 million, in other Miami banks at which BCCI-Miami had accounts. To disguise the money trail, BCCI transferred the cash electronically from Miami to BCCI banks in Panama and the Grand Cayman Islands.

Jeb's name also shows up in a September 1987 BCCI document written by Amjad Awan, then a senior BCCI-Miami official. The memorandum planned a BCCI breakfast meeting with a senior level delegation from the People's Republic of China and high Florida state government officials, including Secretary of Commerce Jeb Bush. Among the Chinese delegation was Ge Zhong Xue, Deputy Division Chief of the Ministry of Public Security, a top police official.

Meanwhile, Jeb and his business partner Armando Codina profited handsomely when the Bush administration bailed out Broward Federal Savings and Loan in Sunrise, Florida, which went belly up in 1988. The Federal Deposit Insurance Corporation (FDIC) absorbed $285 million in bad loans, including a $4.6 million loan by the Bush-Codina partnership. According to the deal struck by federal regulators, the Bush-Codina partnership wrote a check for $505,000 to the FDIC, and the government paid off the remaining $4.1 million of the loan for an office building on which Jeb and Codina defaulted. As a result of the bailout, the Bush-Codina partnership retained possession of its office building at 1390 Brickell Avenue in Miami's posh financial district.

Currently, Jeb is involved in a number of joint ventures with Codina, a Miami real estate developer who is also a leader of the right-wing Cuban American National Foundation (CANF). The Brickell Avenue office building is owned by IntrAmerica Investments. Jeb was listed in business documents in 1985 and in 1986 as the president of IntrAmerica Investments, and the building is managed by one of Jeb's real estate companies. Codina owns 80 percent of the building, while Jeb owns the remaining 20 percent.

Jeb has acted as the Reagan and Bush administration's liaison with the politically influential Cuban exile community in South Florida. Jorge Mas Canosa, president of CANF, succinctly described Jeb's role as the ultra-right Cuban-American community's liaison with the White House: "He is one of us."

Jeb Asks Dad To Free Terrorist
As a link to that powerful and wealthy South Florida community, Jeb has been a tireless supporter of some of the most reactionary Cuban-American political causes -from promoting CANF projects like Radio and TV Marti & acute;, to lobbying for the release of anti-Castro terrorist Orlando Bosch from a Miami jail. TV propaganda broadcasts into Cuba, considered by legal experts a violation of the International Telecommunications Convention, are fully subsidized by U.S. taxpayers.

Anti-Castro terrorist Orlando Bosch was paroled in 1990 after Jeb lobbied the Bush administration for his release from prison in Miami. Bosch had been jailed in 1988 for jumping bail on a 1968 conviction for shooting a bazooka at a Polish freighter in the Miami harbor. He is better known as the mastermind of the explosion of a Cuban commercial airliner over Barbados on October 5, 1976, in which 73 passengers were killed. A U.S. District Court judge revealed in 1988 that secret U.S. documents concluded Bosch was a leader of the Coordination of United Revolutionary Organizations (CORU), which was responsible for more than 50 anti-Castro bombings in Cuba and elsewhere in the Western Hemisphere.

The Cuban government filed an order for his extradi- ction in May 1992.

"Tell Him...The Vice President's Son" Called
"There was no conflict of interest," third Bush son Neil told reporters after the Office of Thrift Supervision (OTS) in Washington issued a notice of intent in January 1990 to hold a hearing on the failure of Silverado Banking Savings and Loan. Neil had been a member of Silverado's board of directors from 1985 to 1988. *45 Federal regulators shut down Silverado shortly after George Bush was elected president in 1988. The federal bailout cost U.S. taxpayers $1 billion.

Neil was responding to charges made in an OTS report that he had "breached his fiduciary duty" to Silverado by engaging in unethical business deals while a board member of the Denver savings and loan. The report documented that Neil personally profited from questionable Silverado loans to his business partners, Ken Good and Bill Walters. Good and Walters later defaulted on $132 million in loans to Silverado, leaving the taxpayers to pick up the tab.

The OTS report alleged that Neil failed to disclose his business connections to Good and Walters when he voted to approve a $900,000 line of credit to Good International, Inc. Neil got Silverado to write a letter of recommendation to authorities in Argentina, where Good International, in partnership with Neil's JNB Exploration Company, was exploring for gas and oil. Good also gave the President's third son a $100,000 loan to invest in the commodities market, which Bush was never required to repay.

Neil failed to inform Silverado that Walters had contributed $150,000 to the initial capitalization of JNB Exploration, or that Walters' Cherry Creek National Bank in Denver extended a $1.5 million line of credit to JNB Exploration. Neil put up a paltry $100 in start-up funds in 1983 when he founded JNB Exploration, but over the next five years was paid $550,000 in salary drawn from the Cherry Creek National Bank line of credit.

Neil brought few business skills to his job at JNB Exploration but he was adept at cashing in on his family name. "Tell him Neil Bush called," Neil once told the secretary of a wealthy Denver oil entrepreneur. "You know, the vice president's son."

"Neil knew people because of his name," acknowledged Evans Nash, one of Neil's partners at JNB Exploration. "He's the one that got us going. He's the one that made it happen for us."

When Neil left JNB Exploration in 1989, the company had yet to discover a profitable gas or oil well.

Neil: The Sensitive One
Neil's business partners also included shady characters with ties to the world of covert operations. In 1985, Good received an $86 million loan from the Dallas Western Savings Association, which was tied to Robert Corson, a Texas developer and reputed CIA operative, and Herman Beebe, Sr., a convicted Mafia associate of Louisiana mob boss Carlos Marcello.

Neil profited from the Western Savings loan to Good, because the loan helped Good buy Gulfstream Land and Development, a Florida real estate company. Good made Neil a board member of one of Gulfstream's subsidiaries in 1988. Bush was paid $100,000 a year to attend occasional Gulfstream board meetings before it went out of business in 1990.

Investigative reporter Pete Brewton identified Corson as a CIA operative in a long Houston Post series on CIA links to organized crime and failed savings and loans. "One former CIA operative told the Post that Corson frequently acted as `a mule' for the agency, meaning he would carry large sums of money from country to country," Brewton wrote.

Corson's Vision Banc Savings in Kingsville, Texas, loaned about $20 million to Mike Atkinson, a Corson associate, for a Florida land deal put together by Lawrence Freeman. Freeman, who laundered money for Santos Trafficante, Jr., was also tied to veteran CIA operative Paul Helliwell. In the Bahamas, Helliwell set up Castle Bank and Trust Ltd., which was the CIA's primary financial front in Latin America and the Caribbean during the 1960s and 1970s. Castle laundered funds for the Agency's covert operations against Cuba.

Walters had ties to Richard Rossmiller, a Beebe associate. In the mid-1970s, Walters was a part-owner with Rossmiller, of Peoples State Bank in Marshall, Texas, at the same time as Rossmiller was doing business with Beebe.

Wayne Reeder, another Beebe associate, a big borrower from Silverado, defaulted on a $14 million loan. Reeder was involved in an unsuccessful arms deal with the Contras. Reeder accompanied his partner, John Nichols, in 1981 to a weapons demonstration attended by Contra leaders Eden Pastora and Raul Arana, both of whom were interested in buying military equipment from Nichols.

"Among the equipment were night vision goggles ... and light machine guns," according to the book, Inside Job: The Looting of America's Savings and Loans. "Nichols ... had a plan in the early 1980s to build a munitions plant on the Cabezon Indian Reservation near Palm Springs, California, in partnership with Wackenhut, the Florida security firm. [But] the plan fell through."

There was another Silverado-Contra connection, however, that didn't fall through. E. Trine Starnes, Jr., the third largest Silverado borrower, was a major donor to the National Endowment for the Preservation of Liberty (NEPL), directed by Carl "Spitz" Channell, which was a part of Oliver North's Contra funding and arms support network. A NEPL document, "Top 25 Contributors as of October 3, 1986," showed Starnes contributed $30,000 to NEPL's Central America Freedom Program. Starnes closed a deal with Silverado on September 30, 1986, for three business loans totaling $77.5 million, on which Starnes later defaulted.

The Central America Freedom Program was a propaganda effort in conjunction with the Reagan administration's campaign in 1986 to win congressional support for resuming arms aid to the Contras. When the administration wooed potential NEPL donors, Starnes was invited to a January 30, 1986, White House briefing, which included Reagan, National Security Adviser John Poindexter, White House Chief of Staff Donald Regan and Assistant Secretary of State Elliott Abrams. Congress resumed U.S. arms aid to the Contras in mid-1986.

In a final ironic Silverado-Contra connection, NEPL banked at the Palmer National Bank in Washington, a bank with ties to Vice President Bush and Herman Beebe. Palmer National was also linked to North's Contra arms network.

Palmer National was established in 1983 by Stefan Halper and Harvey McClean, Jr., two former aides in Bush's unsuccessful presidential campaign in 1980. Halper, who had links to the intelligence community, became deputy director of the State Department's Bureau of Politico-Military Affairs in the Reagan administration. McClean was a Beebe associate. Beebe supplied the majority of the capitalization for the start-up of Palmer National.

"Palmer National lent money to individuals and organizations that were involved in covert aid to the Nicaraguan Contra rebels," Brewton wrote in the Houston Post. "Money was channeled through Palmer National to a Swiss bank account used by . . . North to provide military assistance to the Contras."

Bushed Out
George Herbert Walker Bush is the first former CIA director to serve as president. The implications for U.S. politics of Bush's move from CIA headquarters to the White House are profound and chilling, but seldom the subject of mainstream political discussion. The corruption of the Bush family, however, is a good introduction.

The Bushes' shadowy business partners come straight out of the world in which the CIA thrives-the netherworld of secret wars and covert operators, drug runners, mafiosi and crooked entrepreneurs out to make a fast buck. What Bush family members lack in business acumen, they make up for by cashing in on their blood ties to the former Director of Central Intelligence who became president. In return for throwing business their way, the Bushes give their partners political access, legitimacy, and perhaps protection. The big loser in the deal is the democratic process.



    When you start digging into the circumstances surrounding the death of White House aide Vince Foster, a number of names keep popping up that have popped up in relation to a number of large scandals of the last two decades. Starting with the "October Surprise," the alleged plot to delay the release of hostages from Iran to after the presidential election in 1980 in an attempt to embarrass President Carter, it is indeed striking that the hostages were released just a few hours after President Reagan was sworn in. A number of witnesses have testified to the involvement of Vice President Bush and Earl Brian in this secret plot. These witnesses, all CIA or Mossad assets, have received the "Terry Reed treatment": indictment on false charges and thorough discrediting. But it was another source, White House staffer Barbara Honegger, who wrote the first "October Surprise" book in 1989. It was early in the Reagan administration that Earl Brian, Richard Secord and others used their influence and connections to make money on selling the pirated PROMIS software from Inslaw Inc. Former OSS agent Jackson Stephens is alleged to have made money on PROMIS as well through his Arkansas Systematics Inc. It was there that Vince Foster, as a partner of Hillary Clinton in the Rose Law Firm and representing Systematics, became involved with the Inslaw affair. A much bigger scandal of government corruption was the Savings and Loan scandal of the 1980. The federally backed savings-and-loans were not only looted by crooks and criminals but also by well-connected politicians who needed an easy buck. Neil Bush and Bill and Hillary Clinton are just a few examples. Apparently not content with the hundreds of billions in S & L loot from the taxpayer, corrupt government officials turned to drugs. The CIA-sponsored Contra re-supply network was used to ship illegal drugs of incredible volume into the United States. CIA assets Terry Reed and L.D. Brown implicate Bill Clinton, George Bush and Oliver North with this operation. A confidential CIA document obtained by the Washington Weekly supports the involvement of George Bush by linking him to arms-dealer Adnan Khashoggi, Richard Secord, and CIA asset John Hull, whose ranch in Costa Rica was used for transshipment of drugs and arms through Mena, Arkansas and other U.S. destinations. Another of these scandals during the 1980s was the illegal penetration of the bank that the CIA preferred - the BCCI Bank of Crooks and Criminals. Politicians across the spectrum are implicated in taking bribes to allow this bank to take over American banks with the help of Jackson Stephens and Vince Foster. No serious investigations have been launched by the Bush and Clinton Justice Departments. Leaving aside for a moment the dispute over whether any of these scandals have been proven, there is one remarkable facet about the facts as they have been presented: some names appear in several of these alleged scandals. Topping the list is George Bush, the only CIA director to become President of the United States. It is difficult to reconcile these serious allegations with the rather decent public image of George and Barbara Bush. But to dismiss these allegations out of hand is to accept a conspiracy that includes a large number of unrelated witnesses naming the same culprits in different scandals. But it should also be said that participants in these scandals may have thought they acted to defeat Communism, where the end would justify every means. After all, that was the prime objective of the CIA during the Cold War. Are these the arms of the octopus that reporter Danny Casolaro referred to just before he was found dead in his hotel room in 1991? He told friends he was tracing a network of government corruption involving Inslaw, BCCI, and the October Surprise. Washington D.C. attorney Paul Wilcher was tracing the same Octopus when he was found dead three days after Vince Foster died. Think back to the 1992 elections for a moment. Did George Bush bring up any of the scandals that could have defeated Clinton? Did he mention Whitewater, Cattlegate, Paula Jones, Gennifer Flowers, Mena? Why not? Did he know that it could backfire seriously because of what Bill Clinton knew about him? Did Bill Clinton take advantage of that in his unlikely bid for the presidency? What, then, is this Octopus? It appears to be an association between rogue elements of the CIA and certain elected officials. An analysis of these structures will show that corruption is inevitable. The CIA has a budget of $28 billion, it assassinates people without being held accountable in a court of law, it operates in secret, it has almost unlimited power and is not subject to any meaningful oversight. Only saints could avoid corruption and abuse of power in such an environment. Then what can we do about it? Limit the budget of the CIA, limit its role, subject it to greater outside scrutiny, expose past scandals and hold individuals responsible for their crimes. Three presidents tried to do just that: John F. Kennedy, Richard Nixon, and Jimmy Carter. None of them stayed in office for long, and none of them achieved their goal. Copyright (c) 1995 The Washington Weekly (

Clinton Corpse Collection

I've investigated a lot of crimes over the last 27 years, including murders. Any criminal investigator with the slightest bit of experience and training could easily see (and most have seen) the many flaws, holes and gaps in the so-called Vince Foster "murder" investigation by, of all the federal law enforcement agencies, the Park Police. But, when one does a little more checking into the past of Bill and Hillary Clinton, they will find a long path of former friends, associates and business partners of the Clinton's who have died young and under mysterious circumstances. The following is a partial list of those whose blood cries out for justice.

Kevin Ives and Don Henry: Died August 1987. Reportedly, they had stumbled upon the Arkansas Mena Drug Operation (many stories and articles have been written about Clinton's affiliation with the Mena Mafia) It was first reported that these two young boys died as a result of falling asleep on a railroad track. It was later revealed that Ives had received a crushed skull prior to being placed on the tracks and Henry had been stabbed to death. The following 7 deaths were all of people who reportedly had knowledge and information concerning the mysterious, unsolved murders of Kevin Ives and Don Henry:

  1. Keith Coney:died July 1988 from injuries sustained from a motorcycle accident. Some reports indicated that he was being chased by an unidentified vehicle.
  2. Keith McKaskle: died Nov. 1988 from multiple stab wounds
  3. Greg Collins: died Jan. 1989 from a gunshot wound to the head. No suspect was ever found.
  4. Jeff Rhodes: died April 1989 from a gunshot wound to the head. His body was burned and thrown in a dumpster.
  5. James Milam: died 1989. His death was ruled as being from natural causes, until his head was later recovered from a trash bin!
  6. Richard Winters: died July 1990 from injuries sustained during a robbery attempt. He was a suspect in the death of Kevin Ives and Don Henry. Some reports claim the robbery was only a setup.
  7. Jordan Kettleson: died June 1990. He died from gunshot wounds and was found sitting in his truck.
SeeBo Home Page / Plea for Deliverance / About the Author / EMail Seebo


Bum's Rush

Bum Rap


Rose Law Firm
rebuilds after
improper shredding
of its reputation

When partners of the beleaguered Rose Law Firm held a special meeting in March at the Excelsior Hotel in Little Rock, few if any of them knew the gravity of what was coming.

The Excelsior might seem an odd place for the gathering because the hotel has a peculiar image in the Paula Jones nook of the American psyche. More than a few of the scandal-whipped forces around President Clinton and former Rose partner Hillary Rodham Clinton have buffeted the firm. But in a small capital city, the Excelsior is a convenient downtown location with meeting rooms.

The partners went there rather than use the firm's boardroom at the suggestion of a consultant from Hildebrandt Inc., a business-advice group for law firms.

RONALD CLARKE and the Rose Law Firm offices
They were away from their own Rose Room, where the original partnership agreement struck in 1820 is framed and hanging on a wall, alongside the portrait of the firm's namesake, U.M. Rose, both a founder and former president of the aba. They were away from the hallway lined on both sides with portraits of the firm's leaders over the years. They gathered, instead, on neutral ground, distanced from reminders of their estimable past and more recent predicaments.

During three hours that Saturday at the Excelsior, the consultant detailed a number of business and professional difficulties they faced, which would have been there even if they hadn't suffered some of the slew of Arkansas scandals in the wake of the Clinton presidency. While some Rose lawyers had been slightly apprehensive about this meeting, they didn't expect the shocking question that would be posed by the consultant--whether they even have a future.

Many old law firms stumbling or getting pushed into modernizing their ways have found themselves in this situation, but this was the second time for the Rose lawyers. The firm had forced out its first modern, hands-on leader in 1988 in a then-unreported battle that was probably as traumatic as any law partnership has endured.

C. Joseph Giroir had been named the Rose firm's first-ever chairman of the board and ceo in 1975, after more than 150 years of the firm usually having the eldest chair meetings. In the 1960s Giroir had returned to Arkansas from Washington, where he worked at the Securities and Exchange Commission.

He brought the firm into the age of billable hours, computers and high-premium securities work, then got into trouble with his side business--buying and selling banks while wearing too many hats for his shallow pockets, and using Rose lawyers to do the work.

The Rose firm's loose management system offered an independence and lack of accountability--it was the Rose way, one of honor among partners--that allowed such a fiasco. (That same lack of structure later made possible the tragedy of Webster Hubbell's embezzlement, guilty plea and imprisonment.)

Rose partners ended up paying a $500,000 deductible toward a $3 million settlement with the Federal Deposit Insurance Corp. for fallout from Giroir's business deals.

There were problems enough even without that. The firm's compensation system hadn't contemplated the huge fees in securities work, skewing the fattest draws to the managing partner's clique within the firm and causing unbearable friction. It contributed to his ouster. (And it contributed later, as did the lack of accountability based on honor, to Hubbell's bizarre reasoning in stealing from the firm and its clients.)

07-48 Hillary Rodham Clinton

Rose practice: As partner did legal work for Madison Guaranty S&L; before its collapse.

In Washington: Championed health care reform, children and families. Field general in public defense of husband after allegations of affair with White House intern.

The inside story at Rose: In 1977, Rose lawyers vigorously debated whether hiring her would be a help or a hindrance to the firm. Unlike other Little Rock firms, Rose had always been aloof from politics. That distance made it the most sensible career choice for a very capable lawyer who happened to be the wife of the new state attorney general.

A core of younger leaders guided the Rose firm through those straits in the late 1980s and righted its course, then left a huge vac-uum just four years later when they moved to Washington, D.C., for the Clinton presidency, and ultimately their own personal tragedies and scandals. Hillary Rodham Clinton took up residency in the White House; Hubbell was appointed associate attorney general; Vincent Foster became deputy White House counsel; and William H. Kennedy III was Foster's associate counsel.

Not only was the new cadre of leadership suddenly gone, the problems that soon engulfed them in Washington put the Rose firm in the national spotlight and under the microscope.

The Fallout Begins

Arkansans were giddy with hope when Bill and Hillary Clinton went to Washington, excited with visions of corporations and work and money moving into their now higher-profile state. And the Rose firm, premier among others in the state with its corporate work, figured its national reputation would grow now that its first female lawyer and partner was first lady.

Indeed, Rose lawyers quickly saw their workloads increase, but not exactly in the way they'd hoped or expected. And their reputation, once the most sterling in the state, was tarnished--for the most part wrongly and unfairly and in ways that can never be undone. The Rose Law Firm got a bum rap.

More than 10 years' worth of Rose work and files have been sorted and sifted by more investigative bodies--not to mention investigative reporters--than the firm has practice areas.

Hearings in both houses of Congress delved into the firm's work for Madison Guaranty Savings & Loan Association, poking around for conflicts and fraud behind the Whitewater land deals that were thought to involve wrongdoing by the Clintons. Every file in the firm's work on 38 savings and loan associations for federal regulatory agencies in the big cleanup that began in the late 1980s was combed for possible overbilling--or worse.

The firm opened itself further by doing what few firms have chosen to do--go public with an ethical complaint against an errant partner, Hubbell, and then sue him.

No law firm ever has come under such relentless scrutiny. And probably few could survive it.

A Reputation at Stake

When Little Rock lawyers travel, they almost always are asked about that den of thieves, the Rose firm. When Rose lawyers travel, they sometimes hear wisecracks from hotel desk clerks who think they're Jay Lenos.

What those outsiders don't know is that in Little Rock the Rose Law Firm had long been the one whose name, when mentioned to other lawyers, would elicit a respectful, low-throated, "Oh." It was known for being a cut above the rest and above the fray. It attracted the best minds, scholarly types and the cleanest work, along the lines of a Cravath, Swaine & Moore in New York City or a Covington & Burling in Washington, D.C.

But outside Little Rock that utterance, "Oh," now rises abruptly in pitch, with deris-ive inflection. Among Little Rock lawyers, the sound has not changed much, but they stretch it out just enough to carry a there-but-for-the-grace-of-God sympathy.

The Rose firm has been chewed up by what has been termed "the modern scandal-production machine." Mostly, this is an unholy alliance of congressional members and staff, special interest groups and the news media--and a public eager to see the powerful brought down.

Except for the $482,410 embezzlement by Hubbell from both clients and the firm--which still leaves heads shaking about everybody's Mr. Nice Guy--sensational allegations of wrongdoing at the firm have proved untrue, and that has gone unreported. In other instances, findings that support Rose have been buried many paragraphs down in news stories that still spun the scandal along.

"I'm appalled at how the Rose firm has been attacked by the national press and I think they've been treated unfairly," says Philip S. Anderson, aba president-elect and name partner in Little Rock's Williams & Anderson, where his national litigation practice includes representation of news organizations. "It's just not deserved."

No reporters lingered outside the meeting room that Saturday this past March at the Excelsior. This was purely internal firm bus-iness, away from the raging Whitewater scandal. They had lost a number of partners. They were saddled with ownership of an office building. They were riven by bloc voting.

Like a splash of cold wat-er in the face, the remaining 28 partners suddenly had a hard choice put to them by the consultant. Don Akins of Hildebrandt had a 75-page report with him, based on interviews and surveys of lawyers and staff, a detailed analysis with recommendations.

But his message was simple: Change your management and compensation systems, or dissolve the firm.

It might be easier on everyone to choose the latter, Akins told them. He had seen the same situation in other firms and offered the same recommendations--only to watch them try and fail. But what the Rose firm had going for it, he explained, was one leader everyone trusted. Give him virtually absolute control and get back to work--then let the rising tide lift all boats.

"We made a decision we have something here we want to fight for, and we're going to fight," says one senior partner.

07-49 Webster Hubbell

Rose practice: Partner involved in litigation work and in S&L; cleanup work.

In Washington: Associate attorney general 1993-1994.

The inside story at Rose: Disgruntled that the firm's compensation system was skewed toward the securities group, he began embezzling from the firm and its clients in 1988 and continued for several years. He wasn't found out until after he went to Washington, D.C., to be No. 3 at the Justice Department. "It was like a bird nest on the ground," Rose chief operating officer Ronald Clark says of the paper trail Hubbell thought he could walk away from.

The lawyers voted to implement the recommendations and give up the overly democratic and independent ways that had turned partner meetings into a debating society and permitted Hubbell's Jekyll-to-Hyde demise.

The executive committee was cut from seven to three, with the chief operating officer taking the reins and the other two positions serving as checks on his authority.

Now the Rose Law Firm, the oldest west of the Mississippi River, is trying to move beyond the scandals and tragedies and loss of leaders, and into the future.

The attorneys once thought Foster, acknowledged by many as the soul of the firm, would return from Washington at the end of Clinton's presidency to lead it. "He was my ideal of a young lawyer," says 72-year-old Phillip Carroll, counsel to the firm and for many years its leading litigator. Foster's suicide when the scandal machine was on him full bore ended that hope.

Instead, Ronald M. Clark once again is chief operat-ing officer, the "benevolent dictator we need," says one partner. Clark had held the position through the roughest four years the firm has ever faced, stepping down in February 1996. He declined to seek the additional one-year term for which he was eligible and which he would have gotten.

"Ron was so diverted by all these other things that he really didn't have a chance, management-wise, to do what he'd intended to do," says Garland J. Garrett, who succeeded Clark as coo in March 1996. "He'd taken a beating, he was tired and he took a break." Garrett was instrumental in bringing the consulting firm in to consider restructuring the firm and had no qualms about the recommendation that Clark take back the leadership job.

With new arrangements for governance and compensation, the Rose firm came to resemble most modern law firms--which themselves resemble corporations in lines of reporting and management responsibilities, with close tracking of work and money.

A Seismic Split

Rose once numbered 56 lawyers, and had built its own offices with plans to grow to 80 or 100. The number was at about 44 when the partners held their special meeting.

Then, before the ink was dry on their blueprint for the future, there was yet another major blow. The new power alignment did not sit well with two partners leading the firm's securities group, Les Baledge and Richard Massey. Within weeks, four other partners and three associates left with them to join the three-lawyer Little Rock outpost of Omaha's Kutak Rock.

07-53 Les Baledge:

Lucrative securities group
left with him.

That exodus amounted to virtually all of the firm's lucrative securities practice, and ultimately perhaps as much as 30 percent to 40 percent of the billings.

Baledge had become a big rainmaker at the Rose firm with clients such as Fairfield Communities Inc., the huge national time-share concern based in Arkansas. He is a director of the company and when it bounced back from bankruptcy recently to become a stock market darling, Baledge's personal holdings ballooned to $32 million. But some of his former partners at Rose say Baledge is interested in power, not money.

"If you cross him, vote against him on an issue in a firm meeting, you don't see any work from his clients again," says one partner.

Part of the difficulty was the firm's traditional corporate practice of cautious counsel rubbing up against the go-go nature of high-flying securities work.

"Internal firm management is one of the reasons," Baledge says of his departure. He hints that the Rose firm isn't aggressive enough for his kind of practice.

"The approach to law practice as a profession and business is reason to come to the conclusion that times are right for change. To some extent you will find lawyers maybe raised in a different day and age who think the practice of law is more formal or precise, but it's not. Clients hire lawyers to get things done and for no other reason."

The Rose firm now has 35 lawyers, 22 of them partners, swallowed by 65,000 square feet of office space and harnessed in the yoke of a mortgage. The firm has a history of owning its own buildings that dates back to 1872. In 1981, it bought and refurbished the old ywca building downtown, with the swimming pool in the basement still kept up. In 1990, it added on, doubling the space. New partners must join in ownership of the building af-ter three years.

Firm members say the building, freestanding with a surfeit of parking and near the redeveloping eastern end of downtown, is a valuable asset, although others call it a millstone. The firm has had pre-liminary talks with architects on bifurcating the building, so half of it could be leased out.

At best, the situation is problematic. But at least there is a new lease on the future.

Clark--the one whose decisions all others trusted enough to bank their future on--during an interview at first dismisses questions about the firm's difficulties and plans for the future as "a fairly boring story." But he later becomes more candid and passionate.

"How many firms in America could withstand what we withstood and survive?" asks Clark, who himself has withstood withering questions before congressional committees, grand juries and government regulators, as well as hundreds of re-porters. "It's a testament to the people who are here and to our clients and the loyalty they've shown us."

07-52 William Kennedy III

Rose practice: Was a top corporate lawyer and chief operating officer from 1988 to 1993.

In Washington: Associate White House counsel from 1993 until his resignation in 1995 over late payment of taxes in wife's name and Travelgate role.

The inside story at Rose: Along with Hubbell, Foster and Hillary Clinton, he brought the firm through the tumultuous 1988 ouster of its ceo. Following difficulties that prompted his 1995 resignation, he has returned as a strong contributor in the firm's corporate practice.

He was first elected to the position to begin in April 1993, but had to start two months early to replace William Kennedy, who resigned to become associate White House counsel. (Kennedy returned to the firm in 1995 after the scandal machine got onto his late payment of "nanny taxes," and his role in the Travelgate scandal, in which long-time White House travel office employees were fired to make room for Clinton friends.)

A studious-looking 43-year-old tax lawyer and certified public accountant, Clark has guided the firm through its toughest years, partic-ularly his own trial by fire beginning with the media frenzy in 1994.

The Troubles

With Clark out front as the law firm's lightning rod, Rose took a drubbing in Senate Whitewater Committee hearings by partisan members and the press. Chairman Alfonse D'Ama-to, R-N.Y., was particularly rough on the firm. When the fdic's inspector general reported in the spring of 1994 that the Rose firm had no serious conflicts of interest in the Madison Guaranty Savings and Loan Asso-ciation work, D'Amato was furious.

One of the firm's smaller clients, Madison Guaranty Savings & Loan Associ-ation, controlled by James McDougal, was at the center of the Whitewater investigation.

In the late 1970s the Clintons had bought land on Arkansas' White River along with McDougal and his wife, Susan. D'Amato was looking into allegations that Hillary Clinton represented McDougal in matters before state officials her husband appointed, and into the Rose firm's later representation of the government in suing the concern that audited Madison.

D'Amato angrily ordered the fdic to re-investigate, and the agency contracted out that task to the Washington, D.C., office of San Francisco's Pillsbury, Madison & Sutro. The investigation broadened far beyond the Rose firm's work for Madison Guaranty. The firm had worked on matters involving 38 S&Ls; in the nationwide cleanup that began in the late 1980s for the fdic and Resolution Trust Corp., and for the now-defunct Federal Savings and Loan Insurance Corp.

When the Pillsbury lawyers reported in 1995 that they hadn't found substantial problems with the Rose firm's work, D'Amato, again furious, ordered them to go back and try harder--the clear message was for them to find wrongdoing.

Pillsbury then came up with some "impermissible conflicts" on the part of Rose lawyers. But they were arguably innocuous ones, inevitable in a small state with only so many lawyers capable of handling big matters.

Even without the Rose firm's other problems, this investigative audit would have been daunting enough. Hundreds of law firms around the country were being pinched by audits of their work in the S&L; cleanup.

When the fdic took over from the fslic in the early 1990s, the agency began auditing law firms contracted to handle liquidations of S&Ls; and lawsuits against officers and directors. Bills and expense accounts were suddenly challenged so aggressively, and demands by the fdic for the return of sometimes hundreds of thousands of dollars in alleged overpayments were so great, that some law firms stopped taking the work.

The rules were changed midstream. Hard copies of airline ticket receipts were required, when they hadn't been before. Proof that depositions had been conducted were no longer sufficient for bill-ing; contemporaneous time records were required as well. Firms had to eat the challenged fees and costs.

Most of those audits were done by sampling various files in the firms and working out repayments based on averages. In the case of the Rose firm, D'Amato ordered every file, every bill, every receipt, every scrap of paper investigated.

Eventually, the fdic and rtc wanted the firm to repay $341,486 from billings of about $1.2 million from 1987 through 1993. Rose immediately paid an uncontested $41,000 that, the firm's coo Clark says, "Hubbell flat out stole." Hub-bell's phony billing often matched his personal credit card purchases to the penny. The firm, despite be-ing under tremendous pressure and scrutiny from many directions, challenged the remaining $300,000 and finally settled by paying out $210,000.

Two Rose lawyers handled billing in the S&L; cleanup work: Hubbell and Foster. "They didn't find one thing wrong with Foster's bills," Clark says.

07-50 Vincent Foster

Rose practice: A top litigator who was instrumental in bringing Hillary Clinton into the firm.

In Washington: Deputy White House counsel, 1993 until his suicide in 1994.

The inside story at Rose: Lawyers considered him the ethical and professional backbone of the firm, its soul, and expected him to return as its leader after the Clinton presidency.

The Rose firm had actually been one of the more productive ones for the government, recovering roughly $8 million and receiving about $1.2 million for its work. In a number of instances with other firms, that ratio was reversed. And the cost of the government's own investigation of the Rose firm was steep.

When the fdic inspector general's office wanted to arrange interviews with firm lawyers and staff, Clark suggested it handle the sched-uling by phone. But the office insisted on doing it in person, and flew 11 people to Little Rock to meet with the firm's office manager and go over the list of those they might interview.

After two years of investigations costing nearly $4 million, the Pillsbury firm's final report in February 1996 noted, as far as the Rose firm's work was concerned: "[I]t simply would not be persuasive to argue that, for $21,000 [in legal fees over several years], McDougal corrupted the Rose Law Firm and convinced half a dozen lawyers, most of whom he did not know, to join him in a scheme to violate the law. ... The conspiracy theory is hopelessly flawed."

Further, the Pillsbury report said, any discarding of documents concerning those matters was done "in a seemingly innocent context" of routine purging of files.

The Rose firm's lawyers held their own under the various onslaughts, says Richard Ben-Ven-iste, a former Watergate prosecutor and partner in New York's Weil Gotshal & Manges. Ben-Veniste has spent a lot of time in the eye of storms in Washington but saw new patterns swirling in this scandal. He served 11Ž2 years as minority counsel for the Senate Whitewater Committee's investigation.

"One of the stranger things about these hearings," says Ben-Veniste, "is that you'd see people from the majority [Republican members and staff] out there in the halls sitting with the press in plain view, ba-sically putting forward some version of either this [news] story or the next story. It was so blatant that someone coming from outside the culture would be in for a real shock."

Of the many allegations against the Rose firm, probably the most damaging was that it shredded Whitewater documents in January 1994, just before then-special counsel Robert Fiske could get to them.

When it turned out the only improper shredding was not of documents but of the Rose firm's reputation, the Whitewater scandal machine simply moved on to the next gob of mud to sling.

"[The news media] wouldn't report testimony if it conflicted with that morning's story based on leaked information," Ben-Veniste says. "They were already into the next day's leak and hype."

In January 1996, after Rose coo Clark was grilled for several hours by the Senate Whitewater Committee, following earlier appearances by himself and others at the firm, D'Amato's wrath suddenly softened.

D'Amato concluded with what amounted to an apology for what the firm had endured. The chairman noted that the Rose firm had been in circumstances beyond its control, that "the chair does appreciate" what Clark had to go through, and that witnesses such as Clark "may find themselves in positions which are unfair" in testifying before congressional committees.

D'Amato went on tell Clark: "And I think that you attempted to answer the questions to the absolute best of your recollection. You have not withheld anything from this committee, and you have answered in all candor. And I think that where those observations can be made as it relates to witnesses who come, we have a duty to try to set that record straight and indicate that. And that's why I do that."

Clark's response to the chairman: "It's been nice to finally be talked with instead of just be talked about."

That exchange was not reported outside the committee room. Most notably not in the Washington Times, the ultraconservative newspaper that broke the shredding story in February 1994, apparently on a tip from a young courier at the firm.

And not in the New York Times, which had quickly followed suit with breathless innuendo from the two college frat boys who worked part-time as couriers at Rose--one of whom then placed a classified ad in the American Spectator magazine, selling autographed baggies of shredded Whitewater paper, albeit described as "not actual documents."

The actual documents that had been shredded, it turned out, had nothing to do with Whitewater. Rose simply had engaged in the routine shredding of old files, much as any law firm does in the face of limited storage space.

The Damage Is Done

"People ask us if all this has adversely affected our business," says Clark. "That's almost impossible to tell, which clients did not come to us."

One palpable sign may have come with the first shredding allegations. Just months earlier, in the fall of 1993, the Rose firm had opened a one-man office in Washington, D.C., sending partner Allen Bird II in hopes that his experience in government relations and the firm's possible new cachet in the nation's capital might prove fruitful.

"Then the shredding story hits and I'm radioactive," says Bird. "I had trouble getting people to go to lunch with me. The bottom dropped out and I hadn't generated enough to buy a cup of coffee. Professionally, it was extremely frustrating."

Bird, shaken, packed his bags and returned to Little Rock in November 1995. He has been with the firm since the early 1970s, before it began its rapid growth. Almost immediately upon his return--in a mixture of anguish, curiosity and love for his firm of 25 years--he began researching the Rose history and is writing about it.

Damage to the Rose firm was done and never undone. It became part of the broad stroke of the tar brush that included Hubbell's near $500,000 embezzlement from the firm and its clients--which he was able to do because of the firm's way of letting partners handle all aspects of their own matters. Many firms have quietly settled such transgressions internally with rogue partners.

That damage became part of the backdrop to the search for some of Hillary Clinton's billing records in Whitewater matters, which were removed by either Hubbell or Foster without the firm's knowledge, and which also have proved innocuous--except for possible implications of their mysterious disappearance and re-appearance.

At the height of the media frenzy feeding off the shredding accusations made in February 1994, one of the screaming heads on television's McLaughlin Group predicted the firm soon would go into bankruptcy. An abc News producer demanded an interview with Clark in the firm's offices and followed through on a threat when he was denied: He put a camera outside the firm's door taping everyone coming and going, including clients.

About the same time, in March 1994, the Arkansas Democrat-Ga-zette floated a zinger in a Page One news feature on the Rose Law Firm's travails: "Some people around Little Rock have begun to whisper: Can the firm survive this?"

That same month, a congressman stood virtually alone in the House chambers for one of those C-Span moments--offering to the public record, not a living, breathing audience--an "Academy Award" for special effects to "the Rose firm's shredder. Like the Energizer Bunny, it just keeps on shredding and shredding."

If there was an Energizer Bun-ny at work, it was powering the Rose firm's adversaries.

The federal government's spare-no-cost approach to investigating the Rose firm cut both ways. The firm's lawyers and staff spent untold hours researching their own files to respond to myriad investigations and investigators. While they didn't tally work hours, Clark says the actual out-of-pocket costs, including fees paid to Houston's Vin-son & Elkins to represent the firm in some of the matters, were in the seven figures.

Perhaps it was enough money to have retired the debt on the firm's building.

"It has all had a terrible effect on our good reputation, but particularly on the younger attorneys who have thought it's the end of the firm," says 84-year-old Gaston Wil-liamson, a former Rhodes Scholar and longtime leader of the firm who still keeps an office there and comes in a couple of times a week. "But they'll do all right."

All the Law in Little Rock

It seems certain the Rose Law Firm will continue in some form, which is testament to the institution itself. For years the firm had been among the top three in Little Rock, close in size to the largest and always just a cut above in reputation. Now it is the fourth largest and must find a new niche in the shuffling.

The big three had long been Rose; Friday, Eldredge & Clark; and Wright, Lindsey & Jennings. Close behind has been Mitchell, Williams, Selig, Gates & Woodyard.

Each has its specialties, but always looming over the local legal market is Little Rock-based Ste-phens Inc., the largest financial investment house off Wall Street. Among companies underwritten by Stephens are Wal-Mart and Tyson Foods, the poultry giant.

For years, Stephens has spread a lot of work around to Little Rock law firms. The securities group that left Rose for Kutak Rock is expected to take with it, and continue getting, a lot more lucrative Stephens work.

It would be foolish to dismiss Little Rock and its legal community as backwater with such a powerhouse as Stephens--and the connections it brings--in the mix.

Consider that two leaders at the exclusive Augusta National Golf Club in Georgia are based in Little Rock. Stephens chairman Jack Ste-phens recently stepped down after seven years as chairman of the Augusta club, known for having as members more ceos of large corporations than any other, and for its Masters Tournament, which Ste-phens also chaired.

And his friend Joe T. Ford, chairman and ceo of the Little Rock-based cellular phone giant, Alltel Corp., is vice chairman at Augusta.

Those names and connections have meant a lot of work for Rose over the years and now the question is how much that will continue.

Stephens general counsel, Da-vid Knight, would only say, "We use a large number of local law firms on a regular basis as service provi-ders." Knight had been at the Rose firm in the 1980s, working with for-mer Rose chairman and ceo Giroir in the securities area. He left not long after Giroir was ousted and went to Stephens.

Knight is known to be close to Baledge and Massey, the two key securities partners who left Rose for Kutak Rock. He declined to discuss any of these matters, even on a background basis. "This place is so close that when people talk off the record, it's easy to figure out who's doing it," Knight says.

While the Rose firm has been hurt in recent years, others in town have had their own difficulties. The Friday firm, as it's called, was expected to fall apart after the death four years ago of its omnipotent leader, Herschel Friday. But, unknown to most people outside the firm, Friday had cultivated his successor, William H. "Buddy" Sutton. The firm remains strong and the largest, with more than 70 lawyers.

While the Rose firm has been touted in the national press as a political firm, the reality in Arkansas is that if you want to stop or start legislation, or get your corporate client a tax break, go to the Friday firm, especially to partner Joe Bell. Lawyers point to the famous Oaklawn Race Track in Hot Springs as a classic example--a beneficiary of the legislature in such matters as which days horses can race and regulation of off-track betting.

The Wright, Lindsey & Jennings firm, founded in 1900, had several Whitewater connections, but none that even slightly damaged it. Bruce Lindsey, son of the name partner, left the firm to be Clinton's White House aide and close confidant. The firm proudly shows off its "Governor Clinton Conference Room," which was set up for Clinton when he worked at the firm between his jobs as attorney general and governor. The late name partner Edward L. Wright was aba president in 1970-71.

Perhaps some of the strongest competition for the Rose firm now is the Mitchell firm. Clark says he expects to develop a new securities group at Rose and to add lawyers in the environmental and employment areas.

Those practice areas just happen to figure largely in the Mitchell firm's newly launched, ambitious, detailed five-year strategic plan. The theme behind the plan is to become "recognized as the best law firm in Arkansas," says Mitchell's new managing partner, Richard Campbell. That just happens to be the recognition given Rose for all these many years.

While Rose's numbers have dwindled from a high of 56 lawyers to the current 35, the Mitchell firm has gone the other way, now with 45. The Mitchell firm has grown through lateral hires, in contrast to the Rose method of growing its own. While the Rose firm was forced onto the public stage in recent years, and out of its low-key way of doing things, the Mitchell firm was the first to go hard at modern marketing and public relations, making sure announcements and photos reach business editors.

As elsewhere, the legal market has tightened in Little Rock, and competition rules. The Rose Law Firm is going to have to do more than simply stick to its knitting.

Recruiting hasn't posed any great difficulty because these days in Little Rock, as elsewhere, it's a buyer's market. But there is some question as to whether the firm will be able to attract the same caliber of lawyer it always has.

"We're going to keep doing what we've always done," Clark says. "We're practicing law."

The hope is that the core that still is the Rose Law Firm can flourish anew.

Good and Bad at Rose

1977 Hillary Rodham Clinton becomes first female associate. Clintons buy property on White River.
January 1980 Hillary Clinton becomes first female partner. Bill Clinton loses governorship (regains it in 1986).
1981 Firm outgrows offices and converts ywca building, preserving swimming pool.
April 1988 C. Joseph Giroir, Rose chairman and ceo, ousted over banking deals and feud over compensation system.
November 1988 Webster Hubbell, in financial pinch and perturbed with compensation system, begins stealing.
1993 Hillary Clinton, Vincent Foster, William Kennedy III and Hubbell go to Washington, D.C., with Clinton administration.
July 14, 1993 Wall Street Journal editorial includes sketch portraits of the four, noting, "A Rose clique from Little Rock that has already shown a willingness to cut many legal corners needs adult supervision." Days later, Foster commits suicide.
Jan. 20, 1994 Robert Fiske Jr. named Whitewater special counsel by Attorney General Janet Reno.
Feb. 9, 1994 Rose courier says he was told to shred Whitewater probe documents. Turns out to be unrelated routine file clearing.
Feb. 24, 1994 Gop senators use Banking Committee hearing to accuse Democrats of covering up Clintons' Whitewater deals.
March 1994 Firm tells Arkansas ethics unit of Hubbell's billings. He quickly leaves Justice Department to handle problem.

Summer 1994 Senate Whitewater hearings begin.
Judicial panel names Ken Starr new Whitewater prosecutor.
Dec. 6, 1994 Hubbell pleads guilty to fraud, tax evasion.
November 1995 D.C. office closed. Kennedy quits as associate White House counsel because of taxes, returns to firm.
Jan. 18, 1996 Sen. Alfonse D'Amato, R-N.Y., apologizes to Rose coo Ronald Clark at Whitewater Committee hearing for what firm forced to endure. Questioning and testimony indicate firm did nothing wrong in work and handling files, particularly shredding.
February 1996 Outside probe for fdic and rtc finds firm guilty only of slight "impermissible conflicts of interest" in Whitewater-Madison Guaranty work.
March 1998 Firm is presented with choice to restructure or dissolve. Decides to give Clark virtually total control and go forward.

Terry Carter is a reporter for the ABA Journal. His e-mail address is





On December 26, 1995, the U.S. Treasury Office of Thrift Supervision ("OTS") issued a Notice of Charges against Maxxam, Inc., Federated Development Co., Charles E. Hurwitz, and other individuals, to obtain restitution for losses caused by their alleged violations of federal law in connection with the failure of United Savings Association of Texas. (In the Matter of United Savings Association of Texas, OTS Order N¡ AP95-40.) Respondents have denied all material allegations. A hearing on the charges is now set for July 1997.


OTS has the statutory authority to issue temporary asset preservation orders pending the hearing, freezing the assets of the Respondents including the Maxxam Corporation, to prevent dissipation, but it has not yet taken this important enforcement step. This memorandum discusses the legal and factual basis for issuance of a temporary asset preservation order, and urges the OTS to issue such an order immediately.


While the basis for the order is purely financial and the government's goal would be to preserve Respondents' ability to meet an eventual judgment, it is worth noting in passing that an asset preservation order may also forestall imminent logging threats to the Headwaters Forest, an asset of Maxxam's wholly owned subsidiary, Pacific Lumber, at least until the actual financial impact of those operations can be evaluated.

1. Legal Background

In the wake of the savings and loan scandal, Congress created the Office of Thrift Supervision and gave it significant new powers under legislation known as "FIRREA", a sweeping 1989 revision of the former regulatory and enforcement structure for thrift institutions. Among OTS' new enforcement powers is the power to issue cease and desist orders (including asset preservation orders -- commonly called asset freeze orders) after an administrative hearing, and to issue temporary cease and desist orders, including asset freeze orders, without a hearing. Such proceedings are initiated by filing a Notice of Charges, as was done here.

2. Parties

United Savings Association of Texas ("USAT") was a wholly owned subsidiary of United Financial Group ("UFG"). According to OTS, Maxxam (and its predecessor, MCO Holdings Inc.) and Federated Development Co. ("Federated") were controlling shareholders of UFG Federated was also a controlling shareholder of Maxxam.


Charles E. Hurwitz is a controlling shareholder of Federated and is Chairman of the Board and Chief Executive Officer of both Federated and Maxxam. He was also a Director and Executive Officer of United Financial Group, and, according to the OTS Notice of Charges and a related federal court lawsuit filed against him in August 1995 by the Federal Deposit Insurance Corporation ("FDIC"), a de facto controlling person of USAT.


Barry Munitz, also named as a Respondent in the OTS Notice, is current chancellor of the California State University system. As an officer and director of several of the subject companies during key time periods, Munitz was arguably Hurwitz' right-hand man in controlling USAT's activities.


Also central to the OTS' charges, and to the FDIC's case, is Drexel Burnham Lambert, Michael Milken's notorious investment banking firm that dominated the market for ")unk'' bonds in the 1980s. Though not named as a Respondent in the OTS Notice of Charges, Drexel is alleged to be a key participant in the activities by Maxxam and Hurwitz that brought down USAT. Certain of the allegations central to the gcvernment's case against Maxxam and Hurwitz were first outlined in FDIC v. Milken, a case that ultimately resulted in Milken paying $600 million to the FDIC in settlement of its various claims.


3. Maxxam's Corporate History


In the early 1980s, Maxxam, then known as MCO Holdings, Inc., acquired Simplicity Pattern Corporation. Through a complex series of mergers and reorganizations, Simplicity divested its actual pattern-making operations and changed its name, emerging as Maxxam Group Inc. ("MGI"), then a subsidiary of MCO. After another round of mergers and name changes in the mid-1980s, MCO was renamed Maxxam, which wholly owns MGI. MGI in turn owns Maxxam's operating forest products companies, including Pacific Lumber. Maxxam's other two primary divisions are Kaiser Aluminum (in which Maxxam held a 62% interest at year-end 1995), and Maxxam Properties, a company dedicated to real estate development and speculation.


Pacific Lumber is Maxxam's most widely known and most controversial component. Maxxam acquired Pacific Lumber in 1985 using approximately $850 million of debt financing arranged by Drexel Burnham Lambert. At the time, Maxxam's own net worth was only about $100 million Below, the memorandum describes this acquisition, and Drexel's prior involvement with Maxxam, in greater detail. For more than ten years, both the mechanics of Maxxam's acquisition of Pacific Lumber and Pacific Lumber's subsequent timber practices, have been the subject of considerable litigation, press attention, and public outcry. Among other things, it appears that in its effort to acquire Pacific Lumber, Maxxam benefited from Pacific Lumber stock purchases by Ivan Boesky and Boyd Jefferies--both of whom were subsequently indicted for federal securities law violations


4. Charges Against Maxxam Hurwitz


In section III of the main text of this memorandum, "Description of OTS Charges Against Hurwitz and Maxxam," we outline in substantial detail the OTS' massive Notice of Charges (a document 140 pages long, containing 13 separate claims for relief. The main charging allegations are summarized as follows:


  • Maxxam and Hurwitz violated federal statutory and contractual obligations to maintain the net worth of USAT.


  • USAT's purchases of junk bonds from Drexel were illegal "affiliated party" transactions.


  • Maxxam and Hurwitz engaged in unsafe and unsound banking practices by speculating in mortgage-backed securities, and made false and misleading statements to federal regulators to conceal their activities.


  • Maxxam and Hurwitz caused USAT to enter into sham transactions in order to inflate USAT's gains, hide its losses, and deceive the regulators.


  • Maxxam and Hurwitz caused USAT to make unsafe and unsound investments and loans.


  • Maxxam and Hurwitz willfully disregarded the law regarding safe banking practices; took unreasonable, speculative risks with USAT's capital in the knowledge that USAT's losses would be paid by the taxpayers (through federal deposit insurance), not by them; and were unjustly enriched as a result.


5. OTS' Authority to Issue Asset Preservation Orders


Under FIRREA, the OTS may issue temporary cease and desist orders, including orders to preserve assets, at any time pending a hearing on permanent cease and desist proceedings. No hearing is required before issuance of temporary cease and desist orders. Both permanent and temporary cease and desist orders may include mandatory provisions to prevent further wrongdoing or to remedy past wrongdoing. In other words, the power of the OTS to issue a temporary asset preservation order goes far beyond merely preserving the status quo. Courts have upheld the decisions of the OTS when it has issued temporary remedial orders, including orders to pay money, or to post bond in lieu of paying money.


The OTS authority extends beyond the thrift institutions themselves, and applies to "institution-affiliated parties," individuals and entities deemed by law to have played a role in the operation (and failure) of the thrift. From the statutory definition of institution-affiliated parties, from case law, and from OTS' own allegations, it is absolutely clear that Maxxam and Hurwitz are institution-affiliated parties of USAT,.


The OTS can issue its orders even after the regulated institution has closed. Courts have upheld temporary with affirmative provisions against former officers and directors of defunct thrift institutions on many occasions. The legal argument in support of OTS authority appears in section IV of the main text of the memorandum.


6. Compelling Reasons to Issue Asset Preservation Orders Here


An asset preservation order should issue here because the assets of Maxxam and Hurwitz may be in immediate jeopardy.


From our review of Maxxam's financial statements and SEC filings, it appears that on its books, Maxxam is grossly over-leveraged and that its shareholders essentially have no equity. Based on Maxxam's own financial statements, the total value of Maxxam's liabilities, including contingent obligations, appears to exceed the value of its assets. Further, we suspect, based on those statements, that the value of certain of Maxxam's assets is overstated at least slightly, and certain liabilities and contingent liabilities are significantly understated. Also, the OTS should consider the fact that Maxxam, through its Kaiser subsidiary, has, for the last several years, consistently expanded its investments outside of the United States, including investments in China. Maxxam's most valuable corporate assets increasingly lie overseas, invested in Maxxam's aluminum processing operations. We believe that the longer the OTS waits to move against Maxxam, the less likely it is that Maxxam will have U.S-based assets available to satisfy any ultimate restitution order.


Maxxam's marginal book valuation is of particular concern because the actual misconduct alleged by OTS in the Notice of Charges includes material misrepresentations on the part of Mr. Hurwitz and his associates regarding the financial condition of an institution under their control, as does the misconduct alleged in a parallel complaint filed by the FDIC against Mr. Hurwitz exclusively. In a parallel proceeding against Mr. Hurwitz filed by the FDIC on August 2, 1995 the FDIC states: "Hurwitz and his colleagues covered up the true state of the Association by a pattern of deceptive financial reporting and balance sheet manipulation. Gains were taken on certain securities transactions, while losses were left imbedded in the portfolio; . . . losses on real estate investments were repeatedly understated..." (Complaint in FDIC v. Hurwitz, par. 16) Although Hurwitz has denied all material allegations in the Complaint and Respondents have denied all material allegations in the Notice of Charges, in the absence of a final adjudication in their favor (which, in our opinion, is very unlikely), based on these allegations in the complaint and those in the Notice of Charges there are substantial reasons to believe that there is a real risk of dissipation.


Nor is the veracity of other elements of Maxxam's current management beyond reproach: ruling on the accuracy of Maxxam subsidiary Pacific Lumber's' record keeping in a non-financial arena, U.S. District Court Judge Louis C Bechtle, in his findings in Marbled Murrelet v. Pacific Lumber indicated that Pacific Lumber Intentionally understated the number of endangered sea-birds detected on its property in an effort to forestall regulatory intervention in its logging operations. All of this suggests that Maxxam's balance sheet must be subject to the highest level of scrutiny.


Current logging plans of Maxxam's subsidiary, the Pacific Lumber Company (Pacific Lumber or PALCO) lead to heightened concern. Since the takeover, PALCO's timber assets have been liquidated at an alarming rate (both in terms of environmental consequences and in terms of the long-term sustainability of the company), in part to service the heavy burden of junk bond debt incurred in the takeover. Until recently, PALCO's most valuable assets, its stands of virgin oldgrowth redwood, have, however, been largely immune. Plans now have been announced to log in the heart of PALCO's virgin groves and in nearby residual oldgrowth stands, removing individual trees that are worth between $30,000 and $100,000 after passing through PALCO's mills1. As OTS' complex case wends through the judicial system, there is a very real possibility that these extremely valuable assets will be liquidated and dissipated before a final resolution is reached.


Issuance of a temporary asset preservation order will expedite resolution of all issues and accelerate the process of judicial review. No compelling reasons exist not to issue a temporary asset preservation order. Should the charges against Maxxam not be sustained, the order would be lifted within a few months. On the other hand, if, as we believe is likely, the OTS' charges against Maxxam and Hurwitz are sustained, a temporary asset preservation order will preserve Maxxam's assets pending full restitution by Maxxam and Hurwitz to the taxpayers.


Many of the discussion sections below are prefaced with key excerpts from the OTS Notice of Charges. Even without the explanatory material that follows, we believe that these excerpts present a compelling case for issuance of a temporary asset preservation order against Maxxam and Hurwitz.


1An Individual old-growth redwood tree is estimated to be worth about 830.000 at the sawmill. The same tree is worth about $100,000 as lumber at a retail lumber yard. Since PALCO operates its own mill. the value of old-growth logs to the company would fall within this range.

George Bush: The Unauthorized Biography  

by Webster G. Tarpley & Anton Chaitkin

Chapter -XVII- The Attempted Coup D'Etat of March 30, 1991

"Bizarre happenstance, a weird coincidence"

Bush spokeswoman Shirley M. Green, March 31, 1981

cui prodest scelus, is fecit

--Seneca, first century AD

For Bush, the vice presidency was not an end in itself, but merely another stage in the ascent towards the pinnacle of the federal bureaucracy, the White House. With the help of his Brown Brothers, Harriman/Skull and Bones network, Bush had now reached the point where but a single human life stood between him and the presidency.

Ronald Reagan was 70 years old when he took office, the oldest man ever to be inaugurated as president. His mind wandered; long fits of slumber crept over his cognitive faculties. On some days he may have kept bankers' hours with his papers and briefing books and meetings in the Oval Office, but he needed a long nap most afternoons and became distraught if he could not have one. His custom was to delegate all administrative decisions to the cabinet members, to the executive departments and agencies. Policy questions were delegated to the White House staff, who prepared the options and then guided Reagan's decisions among the pre-defined options. This was the staff that composed not just Reagan's speeches, but the script of his entire life: for normally every word that Reagan spoke in meetings and conferences, every line down to and including "Good morning, Senator," every word was typed on three by five file cards from which the Reagan would read.

Foreign leaders like the cunning Francois Mitterrand professed shock over Reagan's refusal to depart from the vaguest generalities in response to impromptu questions; Mitterrand had attempted to invite Reagan to a private tete-a-tete, but he had been overruled by Reagan's staff. French Foreign Minister Cheysson lamented that the exchanges had been "shallow." When asked for decisions in the National Security Council, Reagan would often respond with his favorite story about black welfare mothers chiselling the government out of money; aides would then interpret that as approval of the options they were putting forward.

But sometimes Reagan was capable of lucudity, and even of inspired greatness, in the way a thunderstorm can momentarily illuminate a darkling countryside; these moments often involved direct personal impressions or feelings. Reagan's instinctive contempt for Bush after the Nashua Telegraph debate was one of his better moments. Reagan's greatest moment of conceptual clarity came in his televsion speech of March 23, 1983 on the Strategic Defense Initiative, a concept that had been drummed into the Washington bureaucracy through the indefatigable efforts of Lyndon LaRouche and a few others. The idea of defending against nuclear missles, of not accepting mutually assured destruction, and of using such a program as a science driver for rapid technological renewal was something Reagan permanently grasped and held onto even under intense pressure in Hofdie House in Reykjavik in October, 1986 during the summit with Gorbachov. In addition, during the early years of Reagan's first term, there were enough Reaganite loyalists, typified by William Clark, in the administration to cause much trouble for the Bushmen. But as the years went by, the few men like Clark that Reagan had brought with him from California would be ground up by endless bureaucratic warfare, and their replacements, like McFarlane at the NSC, would come more and more from the ranks of the Kissingerians. Unfortunately Reagan never developed a plan to make the SDI an irreversible political and budgetary reality, and this critical shortcoming grew out of Reagan's failed economic policies, which never substantially departed from Carter's.

But apart from rare moments like the SDI, Reagan tended to drift. Don Regan called it "the guesswork presidency;" for Al Haig, frustrated in his own lust for power, it was government by an all-powerful staff. Who were the staff? At first it was thought that Reagan would take most of his advice from his old friend Edwin Meese, his close associate from California days, loyal and devoted to Reagan, and sporting his Adam Smith tie. But it was soon evident that the White House was really run by a troika: Meese, Michael Deaver, and James Baker III, Bush's man.

Deaver's specialty was demagogic image-mongering. Deaver's images were made for television; they were edifying symbols without content, and took advantage of the fact that Reagan so perfectly embodied the national ideology of the Americans that most of them could not help liking him; he was the ideal figurehead. Deaver had another important job, for Reagan, as everybody knows, was uxorious: Nancy Reagan, the narrow-minded, vain, petty starlet was the one the president called "Mommy." Nancy was the mamba of the White House, the social-climbing arriviste of capital society, an evil-tongued presence on a thousand telephones a week complaining about the indignities she thought she was subjected to, always obsessed by public opinion and making Ronnie look good in the most ephemeral short term. Deaver was like a eunuch of the Topkapi harem, responsible for managing the humors of the sultan's leading odalisque.

Nancy was a potential problem for Bush; she did not like him; perhaps she sensed that he was organizing a putsch against Ronnie. "He's a nice man and very capable. But he's no Ronnie. He comes across as a 'wimp.'I don't think he can make it. He's a nice man, but his image is against him. It isn't macho enough." [fn 1] So spoke Nancy Reagan to her astrologer, Joan Quigley, in the White House in April, 1985. That could have been a very serious problem indeed, and that was where James Baker came in.

If Deaver played the eunuch for Nancy, Baker was to impersonate her squire and champion. In Nancy's provincial view, Baker was a sartorially elegant, old money aristocrat and charmeur. His assignment for the Bush machine was to ingratiate himself with the adolescent old lady with flattery and schmooze, and Nancy appears to have been entranced by Baker's Princeton Ivy Club veneer --those ties! Those suits!

Deaver gravitated by instinct towards Baker; Deaver tells us in his memoirs that he was a supporter of Bush for vice president at the Detroit convention. This meant that Baker-Deaver became the dominant force over Ron and over Nancy; George Bush, in other words, already had an edge in the bureaucratic infighting.

Thus it was that White House press secretary James Brady could say in early March, 1981: "Bush is functioning much like a co-president. George is involved in all the national security stuff because of his special background as CIA director. All the budget working groups he was there, the economic working groups, the Cabinet meetings. He is included in almost all the meetings." [fn 2]

Even before the inauguration, James Baker had told a group of experienced Republican political operatives in Houston that Reagan was only interested in the public and symbolic aspects of the presidency, and that he had asked the Bush people to come in and take over the actual running of day to day government affairs. That was, of course, the self-interested view of the Bushmen. There were reports in the Bush camp that Reagan would quit after a year or two and let Bush entrench himself as the incumbent before the 1984 election. Later, after 1984, there were even more frequent rumors that Reagan would resign in favor of Bush. It did not happen, showing that Reagan was not the pushover that the Bushmen liked to pretend.

During the first months of the Reagan Administration, Bush found himself locked in a power struggle with Gen. Alexander Haig, whom Reagan had appointed to be Secretary of State. Haig was a real threat to the Bushmen. Haig was first of all a Kissinger clone with credentials to rival Bush's own; Haig had worked on Henry's staff during the Nixon years; he had been the White House chief of staff who had eased Nixon out the door with no trial, but with an imminent pardon. Haig's gifts of intrigue were considerable. And Haig was just as devoted to the Zionist neoconservatives as Bush was, with powerful ties in the direction of the Anti-Defamation League. It was, althogether, a challenge not to be taken lightly. Haig thought that he had been a rival to Bush for the vice-presidency at the Detroit convention, and perhaps he had been.

Inexorably, the Brown Brothers, Harriman/Skull and Bones networks went into action against Haig. The idea was to paint him as a power-hungry megalomaniac bent on dominating the administration of the weak figurehead Reagan. This would then be supplemented by a vicious campaign of leaking by Baker and Deaver designed to play Reagan against Haig and vice-versa, until the rival to Bush could be eliminated.

The wrecking operation against Haig started during his confirmation hearings, during which he had to answer more questions about Watergate than Bush had faced in 1975, when the facts were much more recent. Senator Tsongas was wired in: Tsongas, motivating his negative vote against Haig's confirmation, told the nominee: "You are going to dominate this administration, if I may say so. You are by far the strongest personality that's going to be in there." [fn 3]

Three weeks into the new administration, Haig concluded that "someone in the White House staff was attempting to communicate with me through the press," by a process of constant leakage, including leakage of the contents of secret diplomatic papers. Haig protested to Meese, NSC chief Richard Allen, Baker, and Bush. Shortly thereafter, Haig noted that "Baker's messengers sent rumors of my imminent departure or dismissal murmuring through the press." Soon "'a senior presidential aide' was quoted in a syndicated column as saying, 'We will get this man [Haig] under control.'" [fn 4] It took a long time for Baker and Bush to drive Haig out of the administration. Ultimately it was Haig's attempted mediation of the Malvinas crisis in April, 1982 that weakened Haig to the point that he could be finished off. His fall was specifically determined by his action in giving Ariel Sharon a secret carte blanche for the Israeli government to invade Lebanon, including the city of Beirut. Reagan was justifiably enraged. Shortly before his ouster, Haig got a report of a White House meeting during which Baker was reported to have said, "Haig is going to go, and quickly, and we are going to make it happen." [fn 5]

Haig's principal bureaucratic ploy during the first weeks of the Reagan administration was his submission to Reagan on the day of his inauguration of a draft executive order to organize the National Security Counbcil and interagency tasks forces, including the crisis staffs, according to Haig's wishes. Haig refers to this document as National Security Decision Directive 1 (NSDD 1), and laments that it was never signed in its original form, and that no comparable directive for structuring the NSC interagency groups was signed for over a year. Ultimately a document called NSDD 2 would be signed, formalizing the establishment of a Special Situation Group (SSG) crisis management staff chaired by Bush. Haig's draft would have made the Secretary of State the Chairman of the SSG crisis staff in conformity with Haig's demand to be recognized as Reagan's "vicar of foreign policy." This was unacceptable to Bush, who made sure with the help of Baker and probably also Deaver that Haig's draft of NSDD 1 would never be signed.

Haig writes about this bureaucratic struggle as the battle for the IG's (Interagency Groups) and SIG's (Special or Senior Interagency Groups), generally populated by undersecretaries, assistant secretaries, and deputy assistant secretaries within the NSC framework. As Haig points out, these Kissingerian structures are the locus of much real power, especially under a weak president like Reagan. Haig notes that "in organizational terms, the key to the system is the substructure of SIG's and IG's in which the fundamentals of policy (domestic and foreign) are decided. On instructions from the President, the IG's (as I will call the whole lot, for the sake of convenience), can summon up all the human and informational resources of the federal government, study specific issues, and develop policy options and recommendations. [...] IG chairmanships are parceled out to State and other departments and agencies according to their interests and their influence. As Kissinger, that canny veteran of marches and countermarches in the faculty of Harvard University, recognized, he who controls the key IG's controls the flow of options to the President and, therefore, to a degree, controls policy." [fn 6]

The struggle between Haig and Bush culminated towards the end of Reagan's first hundred days in office. Haig was chafing because the White House staff, meaning Baker, was denying him acess to the president. Haig's NSDD 1 had still not been signed. The, on Sunday, March 22, Haig's attention was called to an elaborate leak to reporter Martin Schram that had appeared that day in the Washington Post under the headline "WHITE HOUSE REVAMPS TOP POLICY ROLES; Bush to Head Crisis Management." Haig's attention was drawn to the following paragraphs:

Lower down on the page was a smaller article entitled "Anatomy of a Washington Rumor," to which we will return.

Haig says that he called Ed Meese at the White House to check the truth of this report, and that Meese replied that there was no truth to it. Haig went to see Reagan at the White House. Reagan was concerned about the leak, and reassured Haig: "I want you to know that the story in the Post is a fabrication. It means that George would sit in for me in the NSC in my absence, and that's all it means. It doesn't affect your authority in any way." Haig also says that he received a further call from Reagan assuring him that his authority was not to be diminished in the slightest.

But later the same afternoon, White House press secretary James Brady read the following statement to the press:

Haig says he then drew up his letter of resignation, but hesitated to sign it. He called Bush to complain: "The American people can't be served by this. It's an impossible situation for you and me to be in. Of course, you chair the NSC in the President's absence. We didn't need to say it. This is all mischief. Why the hell did they do this without discussing it with me." Haig went on: "I have been dealt with duplicitiously, George. The President has been used. I need a public reaffirmation of my role or I can't stay here." Can it be that Haig was so naive that he did not realize that Bush was his ruthless rival and the source of many of his problems? Haig undoubtedly knew, but chose not to say so in memoirs written after he had been defeated. For Haig also knew that Bush was vindictive. Haig does note that he was convinced that Meese was not part of the cabal out to get him. Haig had further conversations with Reagan during these days, which often seemed to have cleared up the confusion, but which in retrospect were never conclusive. In the meantime, George Bush had seized control of the Special Situation Group, which would take control of the Executive Branch in time of crisis or national emergency. It was a superb starting point for a coup d'etat.

The other article in the Washington Post of Sunday, March 22 was also a harbinger of things soon to come. This piece was entitled "Anatomy of a Washington Rumor," and the rumor it traced was that "Vice President George Bush had been nicked by a bullet in a predawn shooting outside a townhouse somewhere on Capitol Hill." According to this story, the source of the rumor in question was a young woman artist living on Capitol Hill who had rushed into the street on the evening of February 22 when she heard the sound of a traffic accident near her home. There she was met a by a police officer whom she had met previously, on the occasion of the murder a few weeks earlier of a young Supreme Court Librarian in the same spot. According to the woman artist, the policeman told her: "The vice president was shot today." When the woman artist tried to check on this story with the news media, the article alleged, the rumor took on a life of its own and became an inchoate news story, with Jack Anderson and others trying to verify it.

Vice President Bush was reportedly very angry when he was told about the rumor: "Peter Teeley, the vice president's press secretary, told Bush of the inquiries. The vice president was incredulous and was as angry as Teeley had ever seen him. 'Jesus, this is the craziest thing I have ever heard,' he said. Bush though the whole thing was silly. 'You should call Barbara,' he told Teeley, ' and let her know what this is all about." Why would Bush be so angry about a spurious report?

As reporters dug deeper into the alleged shooting, one asked a Secret Service contact if there had been any recent shooting incidents monitored by his agency. "The answer came back. On March 8, as a motorcade drove west on Canal Road, officers had heard a 'popping sound' from a 'steep, rocky cliff' on the Virginia side of the Potomac River. But it had been President Reagan's motorcade, not Bush's. And the noises never proved to be gunfire." [fn 9] Had there been an attempt to assassinate Reagan, or to intimidate him? In any case Senator Howard Baker, the GOP majority leader at that time, was overheard making jokes about the allegedly discredited Rumor at a weekend party, and this was duly noted in the Washinton Post of March 25.

In the midst of the Bush-Baker cabal's relentless drive to seize control over the Reagan administration, John Warnock Hinckley Jr. carried out his attempt to assassinate President Reagan on the afternoon of March 30, 1981. George Bush was visiting Texas that day. Bush was flying from Fort Worth to Austin in his Air Force Two Boeing 707. In Fort Worth, Bush had unveiled a plaque at the Hyatt Regency Hotel, the old Hotel Texas, designating it as a national historic site. This was the hotel, coincidentally, in which John F. Kennedy had spent the last night of his life, before going on to Dallas the next day, November 22, 1963. Here was a sinister symbolism!

In Austin Bush was scheduled to deliver an address to a joint session of the Texas state legislature. It was Al Haig who called Bush in the clear and told him that the President had been shot, while forwarding the details of Reagan's condition, insofar as they were known, by scrambler as a classified message. Haig was in touch with James Baker III, who was close to Reagan at George Washington University hospital. Bush's man in the White House situation room was Admiral Dan Murphy, who was standing right next to Haig. Bush agreed with Haig's estimate that he ought to return to Washington at once. But first his plane needed to be refueled, so it landed at Carswell Air Force Base near Austin.

Refueling took about forty minutes; during this time Bush talked on board the plane with Texas Governor William Clements, his wife, Rita, and Texas Secretary of State George Strake. Texas Congressman Jim Wright was also travelling on Bush's plane that day, as were Congressmen Bill Archer of Houston and Jim Collins of Dallas. Bush's top aide Chase Untermeyer was also with the party on Air Force Two. [fn 10]

Bush says that his flight from Carswell to Andrews Air Force Base near Washington took about two and one half hours, and that he arrived at Andrews at abouit 6:40 PM. Bush says he was told by Ed Meese that the operation to remove the bullet that had struck Reagan was a success, and that the president was likely to survive. Bush's customary procedure was to land at Andrews and then take a helicopter to the vice presidential residence, the Naval Observatory on Massachusetts Avenue. His aides Ed Pollard and John Matheny suggested that he would save time by going by helicopter directly to the White House south lawn, where he could arrive in time to be shown on the 7 PM Eastern time evening news broadcasts. Bush makes much oif the fact that he refused to do this, allegeedly on the symbolic grounds that "Only the President lands on the south lawn."

Back at the White House, the principal cabinet officers had assembled in the situation room and had been running a crisis management committee during the afternoon. Haig says he was at first adamant that a conspiracy, if discovered, should be ruthlessly exposed: "It was essential that we get the facts and publish them quickly. Rumor must not be allowed to breed on this tragedy. Remembering the aftermath of the Kennedy assassination, I said to Woody Goldberg, 'No matter what the truth is about this shooting, the American people must know it." [fn 11] But the truth has never been established.

Defense Secretary Caspar Weinberger's memoir of that afternoon reminds us of two highly relevant facts. The first is that a "NORAD [North American Air Defense Command] exercise with a simulated incoming missle attack had been planned for the next day." Weinberger agreed with General David Jones, the chiarman of the Joint Chiefs of Staff, that this exercise should be cancelled. [fn 12]

Weinberger also recalls that the group in the Situation Room was informed by James Baker that "there had been a FEMA [Federal Emergency Management Administration] exercise scheduled for the next day on presidential succession, with the general title 'Nine Lives.' By an immediate consensus, it was agreed that exercise should also be cancelled." [fn 13]

As Weinberger further recalls, "at almost exactly 7:00, the Vice President came to the Situation Room and very calmly assumed the chair at the head of the table." [fn 14] According to Weinberger, the first item discussed was the need for someonme to sign the Dairy Price Support Bill the next day so as to reassure the public. Bush asked Weinberger for a report on the status of US forces, which Weinberger furnished.

Another eyewitness of these transactions was Don Regan, whom the Tower Board later made the fall-guy for Bush's Iran-contra escapades. Regan records that "the Vice President arrived with Ed Meese, who had met him when he landed to fill him in on the details. George asked for a condition report: 1) on the President; 2) on the other wounded; 3) on the assailant; 4) on the international scene. [...] After the reports were given and it was determined that there were no international complications and no domestic conspiracy, it was decided that the US government would carry on business as usual. The Vice President would go on TV from the White House to reassure the nation and to demonstrate that he was in charge." [fn 15]

As Weinberger recounts the same moments: "[Attorney General Bill French Smith] then reported that all FBI reports concurred with the information I had received; that the shooting was a completely isolated incident and that the assassin, John Hinckley, with a previous record in Nashville, seemed to be a 'Bremmer' type, a reference to the attempted assassin of George Wallace." [fn 16]

Those who were not watching carefully here may have missed the fact that just a few minutes after George Bush had walked into the room, he had presided over the sweeping under the rug of the decisive question regarding Hinckley and his actions: was Hinckley a part of a conspiracy, domestic or international? Not more than five hours after the attempt to kill Reagan, on the basis of the most fragmentary early reports, before Hinckley had been properly questioned, and before a full investigation had been carried out, a group of cabinet officers chaired by George Bush had ruled out a priori any conspiracy. Haig, whose memoirs talk most about the possibility of a conspiracy, does not seem to have objected to this incredible decision.

From that moment on, "no conspiracy" became the official doctrine of the US regime, for the moment a Bush regime, and the most massivew efforts were undertaken to stifle any suggestion to the contrary. The iron curtain came down on the truth about Hinckley.

What was the truth of the matter? The Roman common sense of Lucius Annaeus Seneca (who had seen so many of Nero's intrigues, and who would eventually fall victim to one of them) would have dictated that the person who would have profited most from Reagan's death be scrutinized as the prime suspect. That was obviously Bush, since Bush would have assumed the presidency if Reagan had succumbed to his wounds. The same idea was summed up by an eighth grade student at the Alice Deal Junior High School in Washington DC who told teachers on March 31: "It is a plot by Vice President Bush to get into power. If Bush becomes President, the CIA would be in charge of the country." The pupils at this school had been asked for their views of the Hinckley assassination attempt of the previous day. [fn 17]

Curiously enough, press accounts emerging over the next few days provided a compelling prima facie case that there had been a conspiracy around the Hinckley attentat, and that the conspiracy had included members of Bush's immediate family. Most of the overt facts were not disputed, but were actually confirmed by Bush and his son Neil.

On Tuesday, March 31 the Houston Post published a copyrighted story under the headline: "BUSH'S SON WAS TO DINE WITH SUSPECT'S BROTHER, by Arthur Wiese and Margarte Downing." The lead paragraph read as follows:

According to the article, Neil Bush had admitted on Monday, March 30 that he was personally acquainted with Scott Hinckley, having met with him on one occasion in the recent past. Neil Bush also stated that he knew the Hinckley family, and referred to large monetary contributions made by the Hinckleys to the Bush 1980 presidential campaign. Neil Bush and Scott Hinckley both lived in Denver at this time. Scott Hinckley was the vice president of Vanderbilt Energy Corporation, and Neil Bush was employed as a land man for Standard Oil of Indiana. John W. Hinckley Jr., the would-be assassin, lived on and off with his parents in Evergreen, Colorado, not far from Denver.

Neil Bush was reached for comment on Monday, March 30, and was asked if, in addition to Scott Hinckley, he also knew John W. Hinckley Jr., the would-be killer. "I have no idea," said Neil Bush. "I don't recognize any pictures of him. I just wish I could see a better picture of him."

Sharon Bush, Neil's wife, was also asked about her acquaintance with the Hinckley family. "I don't even know the brother," she replied, suggesting that Scott Hinckley was coming to dinner as the date of a woman whom Sharon did know. "From what I know and have heard, they [the Hinckleys] are a very nice family...and have given a lot of money to the Bush campaign. I understand he [John W. Hinckley Jr.] was just the renegade brother in the family. They must feel awful."

It also proved necessary for Bush's office to deny that the vice-president was familiar with the "Hinckley-Bush connection." Bush's press secretary, the British-born Peter Teeley, said when asked to comment: "I don't know a damn thing about it. I was talking to someone earlier tonight, and I couldn't even remember his [Hinckley's] name. All I know is what you're telling me." Teeley denied that Bush had revealed that he knew Hinckley or the Hinckley family when he first heard the assassin's name; the vice president "made no mention of it whatsoever." Bush, repeated Teeley, "certainly didn't indicate anything like that."

Chase Untermeyer of Bush's staff, who had been with him throughout the day, put in that in his recollection Bush had not been told the assailant's name through the time that Bush reached the Naval Observatory in Washington on his way to the White House.

On April 1, 1981, the Rocky Mountain News of Denver carried an account of a press conference given the previous day in Denver by Neil Bush. During most of the day on March 31, Neil Bush had refused to answer phone calls from the media, referring them to the vice presidential press office in Washington. But then he appeared in front of the Amoco Building at East 17th Avenue and Braodway in Denver, saying that he was willing to meet the media once, but then wanted to "leave it at that." As it turned out, his wishes were to be scrupulously respected, at least until the Silverado Savings and Loan scandal got out of hand some years later.

The Rocky Mountain News article signed by Charles Roos carried Neil Bush's confirmation that if the assassination had not happened, Scott Hinckley would have been present at a dinner party at Neil Bush's home that very same night. According to Neil, Scott Hinckley had come to the home of Neil and Sharon Bush on January 23, 1981 to be present along with about 30 other guests at a surprise birthday party for Neil, who had turned 26 one day earlier. Scott Hinckley had come "through a close friend who brought him," according to this version, and this same close female friend was scheduled to come to dinner along with Scott Hinckley on that last night of March, 1981.

"My wife set up a surprise party for me, and it truly was a surprise, and it was an honor for me at that time to meet Scott Hinckley," said Neil Bush to reporters. "He is a good and decent man. I have no regrets whatsoever in saying Scott Hinckley can be considered a friend of mine. To have had one meeting doesn't make the best of friends, but I have no regrets in saying I do know him."

Neil Bush told the reporters that he had never met John W. Hinckley, Jr., the gunman, nor his father, John W. Hinckley, president and chairman of the board of Vanderbilt Energy Corporation of Denver. But Neil Bush also added that he would be interested in meeting the elder Hinckley: "I would like [to meet him]. I'm trying to learn the oil business, and he's in the oil business. I probably could learn something from Mr. Hinckley.

Neil Bush then announced that he wanted to "set straight" certain inaccuracies that had appeared the previous day in the Houston Post about the relations betyween the Bush and Hinbckley families. The first was his own wife Sharon's reference to the large contributions from the Hinckleys to the Bush campaign. Neil asserted that the 1980 Bush campaign records showed no money whatever coming in from any of the Hinckleys. All that could be found, he argued, was a contribution to that "great Republican," John Connally.

The other issue the Houston Post had raised regarded the 1978 period, when George W. Bush of Midland, Texas, Neil's oldest brother, had run for Congress in Texas' 19th Congressional district. At that time Neil Bush had worked for George W. Bush as his campaign manager, and in this connection Neil had lived in Lubbock, Texas during most of the year. This raised the question of whether Neil might have been in touch with gunman John W. Hinckley during that year of 1978, since gunman Hinckley had lived in Lubbock from 1974 through 1980, when he was an intermittent student at Texas Tech University there. Neil Bush ruled out any contact between the Bush family and gunman John W. Hinckley in Lubbock during that time.

The previous day, elder son George W. Bush had been far less categorical about never having met gunman Hinckley. He had stated to the press: "It's certainly conceivable that I met him or might have been introduced to him." "I don't recognize his face from the brief, kind of distorted thing they had on TV, and the name doesn't ring any bells. I know he wasn't on our staff. I could check our volunteer rolls." But now Neil was adamant: there had been no contact.

Neil was a chip off the old block, and could not resist some hypocritical posturing at the end of the press conference: "Let me say that my heart goes out--as does the heart of every American--to the people suffering in this tragedy." He mentioned Reagan, Brady, the wounded Secret Service agent and District of Columbia policeman. "And the Hinckley family, for the tremendous pain thbey must be suffering now." And finally: "I only ask now that we can try to put this behind us and move forward in dealing with the problems."

Neil Bush's confirmation of his relations with Scott Hinckley was matched by a parallel confirmation from the Executive Office of the Vice President. This appeared in The Houston Post, April 1, 1981 under the headline "VICE PRESIDENT CONFIRMS HIS SON WAS TO HAVE HOSTED HINCKLEY BROTHER" by Post Washington Bureau Chief Arthur Wiese. Here the second-string press secretary, Shirley Green, was doing the talking. "I've spoken to Neil," she said, "and he says they never saw [Scott] Hinckley again [after the birthday party]. They kept saying 'we've got to get together,' but they never made any plans until tonight." Contradicting Neil Bush's remarks, Ms. Green asserted that Neil Bush knew Scott Hinckley "only slightly."

Shirley Green described the Tuesday night dinner appointment as "a bizarre happenstance, a weird occurence."

Later in the day Bush spokesman Peter Teeley surfaced to deny any campaign donations from the Hinckley clan to the Bush campaign. When asked why Sharon Bush and Neil Bush had made reference to large political contributions from the Hinckleys to the Bush campaign, Teeley responded, "I don't have the vaguest idea." "We've gone through our files," said Teeley, "and we have absolutely no information that he [John W. Hinckley Sr.] or anybody in the family were contributors, supporters, anything."

A summary of this material was made generally available through the Associated Press, which published the following short note on March 31:

It is not known how many newspapers chose to print this AP despatch; it would appear that the Washington Post for one did not do so. The electronic media also do not appear to have devoted much attention to this story. Once the cabinet had decided that there had been no conspiracy, all such facts were irrelevant anyway. There is no record of Neil Bush, George W. Bush, or Vice President George H.W. Bush ever having been questioned by the FBI in regard to the contacts described. They never appeared before a grand jury or a Congressional investigating committee. No special prosecutor was ever appointed. Which is another way of saying that by March, 1981, the United States government had degenerated into total lawlessness, with special exemptions for the now ruling Bush family. Government by laws had dissolved.

The media were not interested in the dinner date of Neil Bush and Scott Hinckley, but they were very interested indeed in the soap opera of what had gone on in the Situation Room in the White House during the afternoon of March 30. Since the media had been looking for ways to go after Haig for weeks, they simply continued this line into their coverage of the White House scene that afternoon. Haig had appeared before the television cameras to say:

This led to an immense hue and cry, mightily stoked by the Bush networks, on the theme that Haig wanted to usurp the presidential succession. More than this garbled statement by Haig, Bush was certain to have been disturbed by Haig's refusal a few seconds later to rule out conspiracy a priori :

But when Bush returned, the cabinet soon decided otherwise.

The "I'm in control here" story on Haig was made into the Leitmotif for his sacking, which was still a year in the future. Reagan's own ghostwritten biography published the year after he left office gives some idea what Baker and Deaver fed the confused and wounded president about what had gone during his absence:

This fantastic account finds no support in the Regan or Weinberger memoirs, but is a fair sample of the Bushman line.

What did interest the media very much was the story of John W. Hinckley Jr.'s obsession with the actress Jodie Foster, who had played the role of a teenage prostitute in the 1976 movie Taxi Driver. The prostitute is befriended by a taxi driver, Travis Bickle, who threatens to kill a senator who is running for president in order to win the love of the girl. Young John Hinckley had imitated the habits and mannerisms of Travis Bickle.

When John Hinckley Jr. had left his hotel room in Washington DC on his way to shoot Reagan, he had left behind a letter to Jodie Foster:

In 1980, Jodie Foster was enrolled at Yale University in New Haven, Connecticut, as an undergraduate. Hinckley spent three weeks in September, 1980 in a New Haven hotel, according to the New York Daily News. In early October he spent several days in New Haven, this time at the Colony Inn motel. Two bartenders in a bar near the Yale campus recalled Hinckley as having bragged about his relationship with Jodie Foster. Hinckley had been arrested by airport authorities in Nashville, Tennesse on October 9, 1980 for carrying three guns, and was quickly released. Reagan had been in Nashville on October 7, and Carter arrived there on October 9. The firearms charge on the same day that the President was coming to town should have landed Hinckley on the Secret Service watch list of potential presidential assassins, but the FBI apparently neglected to transmit the information to the Secret Service.

In February 1981, Hinckley was again near the Yale campus. During this time, Hinckley claimed that he was in contact with Jodie Foster by mail and telephone. Jodie Foster had indeed received a series of letters and notes from Hinckley, which she had passed on to her college dean. The dean allegedly gave the letters to the New Haven police, who supposedly gave them to the FBI. Nevertheless, nothing was done to restrain Hinckley, who had a record of psychiatric treatment. Hinckley had been buying guns in various locations across the United States. Was Hinckley a Manchurian candidate, brainwashed to carry out his role as an assassin? Was a network operating through the various law enforcement agencies responsible for the failure to restrain Hinckley or to put him under special surveillance?

The FBI soon officially rubber-stamped the order promulgated by the cabinet that no conspiracy be found: "there was no conspiracy and Hinckley acted alone," said the bureau. Hinckley's parents' memoir refers to some notes penciled notes by Hinckley which were found during a search of his cell and which "could sound bad." These notes "described an imaginary conspiracy--either with the political left or the political right [...] to assasinate the President." Hinckley's lawyers from Edward Bennett Williams's law firm said that the notes were too absurd to be taken seriously, and they have been suppressed. [fn 21]

In July 1985, the FBI was compelled to release some details of its investigation of Hinckley under the Freedom of Information Act. No explanation was offered of how it was determined that Hinckley had acted alone, and the names of all witnesses were censored. According to a wire service account, "the file made no mention of papers seized from Hinckley's prison cell at Butner, North Carolina, which reportedly made reference to a conspiracy. Those writings were ruled inadmissible by the trial judge and never made public." [fn 22] The FBI has refused to release 22 pages of documents concerning Hinckley's "associates and organizations," 22 pages about his personal finances, and 37 pages about his personality and character. The Williams and Connolly defense team argued that Hinckley was insane, controlled by his obsession with Jodie Foster. The jury accepted this version, and in July, 1982, Hinckley was found not guilty by reason of insanity. He was remanded to St. Elizabeth's mental hospital where he remains to this day with no fixed term to serve; his mental condition is periodically reviewed by his doctors.

The other aspect of the case that would have merited more careful scrutiny was the relation of John W. Hinckley Sr., the gunman's father, to the US intelligence community. The line in the press right after the assassination attempt was that "the father of John Hinckley is a devout Christian who did work in Africa." Some papers also included the fact that John W. Hinckley Sr. had also worked with World Vision, beginning in 1976. World Vision describes itself as the largest "international Christian relief and development agency" active in the third world. It is officially a joint activity of the Episcopal and Presbyterian churches.

"Jack" Hinckley, as the gunman's father was frequently called, during the 1970's became a close associate of Robert Ainsworth, the director of US Ministries for World Vision, Inc. Jack Hinckley's profile was that of a born again Christian. Jack Hinckley and Ainsworth traveled together to the Sahel region of Africa, Zimbabwe, and South Africa. Even before joining World Vision, Jack Hinckley had carried on "relief work" in Guatemala. "Jack and I became very close," Ainsworth said. "Jack was a successful businessman. On occasion he would ask us to pray for his son. It's not that Jack felt that John would do something bad, just that John had no direction, John had not found himself."

World Vision is one of the notorious non-governmental organizations that function as a de facto arm of US intelligence under current arrangements. Robert Ainsworth's pedigree is impressive: he was a foreign area analyst for the US Deaprtment; an advisor in Vietnam during the war there; and chaired an international committee involved in the negotiation of the Chemical and Bacteriological Warfare Treaty of 1973.

The largest contributor to World Vision is the US State Department Agency for International Development (AID), whose program is frankly genocide. Pax Christi, the Catholic human rights organization, has accused World Vision of functioning as a "Trojan horse for US foreign policy." The entire milieu is thus redolent of the US intelligence agencies.

Reagan went into a long convalescence, first in the hospital and then at his ranch in California. Even when Reagan was pronounced fully recovered, he was even more detached than before, even more absent, even more dependent on his long afternoon nap. Nancy Reagan, crazed by fear and unable to comprehend the forces that had been at work behind the assassination attempt, vastly increased her reliance on the astrological advice of her resident clairvoyant, Joan Quigley. Through this channel, the Occult Bureau of British intelligence acquired an awesome capability of manipulation over the Reagan Presidency, which could often be mobilized in favor of Bush. This was all the more true since Nancy Reagan's obsession was always her image, what the press was saying about her and how she looked in the media. Nancy appealed to her astrologer to secure her a better press image. Since the controlled press could be calibrated from day to day by the Bush networks, Nancy Reagan found herself in the grip of a many-levelled inside-outside operation whose true nature she was too shallow to suspect.

As Ms. Quigley has written, she was as resident astrologer of Reagan's court of miracles "responsible for timing all press conferences, most speeches, the State of the Union addresses, the takeoffs and landings of Air Force One. I picked the time of Ronald Reagan's debate with Carter and the two debates with Walter Mondale; all extended trips abroad as well as the shorter trips and one-day excursions, the announcement that Reagan would run for a second term, briefings for all summits except Moscow, although I selected the time to begin the Moscow trip. [...] I re-created Nancy's image, defused Bitburg, erected a chart for the INF treaty. [...] I exposed the President as little as possible to the public and the media from January to August 1987, to protect him from both the physical and political dangers I foresaw. I was heavily involved in what happened in the relations between the superpowers, changing Ronald Reagan's "Evil Empire" attitude, so that he went to Geneva prepared to meet a different kind of Russian leader and one he could convince of doing things our way. Improved relations, glasnost and perestroika may, in some small measure, have come out of this." [fn 23]

Bush took up the duties of the presidency, all the while elaborately denying, in his self-deprecating way, that he had in fact taken control: "He campaigned as 'a President we won't need to train' -- and for two weeks now, George Bush has stepped smoothly into his limited role as surrogate president....The first stand-in greeted visiting dignitaries, announced Reagan's proposed relaxation of auto emission standards, met with Congressional leaders....His duties now include an early briefing with Reagan aides Edwin Meese, James Baker, and Michael Deaver, a meeting with Congressional liaison Max Friedersdorf and a full briefing from national security adviser Richard Allen." [fn 24] During the time that Reagan was convalescing, the president was even less interested than usual in detailed briefings about government operations. Bush's visits to the chief executive were thus reduced to the merest courtesy calls, after which Bush was free to do what he wanted. "Bush has even limited his visits with Reagan. 'I just stop in for a minute or two,' Bush says. 'I think it's better not to overload the circuits.'"

Bush's key man was James Baker III, White House chief of staff and the leading court favorite of Nancy Reagan. During this period Deaver was a wholly controlled appendage of Baker and would remain one for as long as he was useful to the designs of the Bushmen. Among Baker, Deaver, and the astrologer, Nancy Reagan could also be manipulated into substantial subservience to Bush's designs.

And Baker and Deaver were not the only Bushmen in the White House. There were also Bush campaign veterans David Gergen and Jay Moorhead. In the cabinet, one Bush loyalist was Secretary of Commerce Malcolm Baldridge, who was flanked by his Assistant Secretary, Fred Bush (allegedly not a member of the Bush family). The Bushmen were strong in the sub-cabinet: here were Assistant Secretary of State for East Asian and Pacific Affairs John Holdridge, who had served Bush on his Beijing mission staff and during the 1975 Pol Pot caper in Beijing; and Assistant Secretary of State for Congressional Affairs Richard Fairbanks; with these two in Foggy Bottom, Haig's days were numbered. At the Pentagon was Henry E. Catto, the Assistant Secretary of Defense for Public Affairs; Catto would later by rewarded by Bush with an appointment as US Ambassador to the Court of St. James in London, the post that Foreign Service Officers spend their lives striving to attain. Bush was also strong among the agencies: his pal William H. Draper III, scion of the racist Draper clan, was the chairman and president of the Export-Import Bank. Loret Miller Ruppe, Bush's campaign chairman in Michigan, was Director of the Peace Corps.

At the Treasury, Bush's cousin John Walker would be assistant secretary for enforcement. When the BCCI scandal exploded in the media during 1991, William von Raab, the former director of the US Customs, complained loudly that, during Reagan's second term, his efforts to "go after" BCCI had been frustrated by reticence at the Treasury Department. By this time James Baker III was secretary of the Treasury, and Bush's kissing cousin John Walker was an official who would have had the primary responsibility for the intensity of such investigations.

At the Pentagon, Caspar Weinberger's Deputy Assistant Secretary for East Asia, Richard Armitage, was no stranger to the circles of Shackley and Clines. Weinberger had extravagant praise in his Pentagon memoirs for "Rich" Armitage, "who served the Department and me with extraordinary fidelity and skill and unparalleled knowledge and good humor during all the time I was in office." [fn 25] Bush's staff numbered slightly less than sixty during the early spring of 1981. He often operated out of a small office in the West Wing of the White House where he liked to spend time because it was "in the traffic pattern," but his staff was principally located in the Old Executive Office Building. Here Bush sat at a mammoth mahogany desk which had been used in 1903 by his lifetime ego ideal, the archetypal liberal Republican extravagant, Theodore Roosevelt. Bush also kept an office at the Senate. Some of the leading Bush operatives were:

Bush's chief of staff was Admiral Daniel J. Murphy, who had represented Bush in the Situation Room until the vice president had returned from Texas. Murphy had served Melvin Laird and Elliot Richardson when they commanded the Pentagon under Nixon; he had commanded the Sixth Fleet in the Mediterranean during the 1973 Middle East War. Murphy habitually accompanied Bush to attend Reagan's national security briefing each morning in the Oval Office, a ritual that was conducted by Richard Allen as long as he lasted, and attended by Baker and Deaver, plus Haig, until he too was ousted.

The deputy chief of staff was Richard N. Bond, a younger political operative who had worked in the offices of liberal Republicans like William Green of New York and Sen. Charles Mathias of Maryland. He had managed Bush's winning efforts in the Iowa caucuses and in the Connecticut primary.

Bush's executive assistant and special assignments man was Charles G. "Chase" Untermeyer, who had graduated from Harvard, worked as a newspaper reporter and served between 1977 and 1980 as a GOP member of the Texas House of Representatives for the silk stocking Republican 83rd district in Houston, where James Baker, John Connolly, and Leon Jaworski own homes.

Bush's general counsel was C. Boyden Gray, a Harvard-educated lawyer who had worked as a partner for the Washington powerbroker law firm of Wilmer, Cutler, and Pickering, where he was specialized in antitrust litigation and representing businessmen's groups like the Business Roundtable and the American Mining Congress. Gray's family were plutocrats from North Carolina who had sponsored the forced sterilization programs described above. Gray's father, Gordon Gray, had served as chief of the National Security Council during the Eisenhower administration, and had authored the overall document under which the very extensive covert operations of the Eisenhower years had been carried out. "Boy" Gray took an important part in Bush's Task Force on Regulatory Relief, which was billed as an effort to "cut federal red tape," but which in reality furthered the highly destructive process of deregulation in many critical areas of business and finance. Boy Gray's family had profted immensely from the merger of their family firm, R.J. Reynolds Tobacco, with the National Biscuit Company to form RJR-Nabisco. They would profit astronomically from the leveraged buy-out of RJR-Nabisco by the Wall Street firm of Kohlberg, Kravis, Roberts, a swindle that was facilitated by the new regulatory climate that Boy Gray had himself helped to create.

Bush's assistant for domestic affairs was Thaddeus Garrett, Jr., the highest ranking black on Bush's staff and an ordained minister of the African Methodist Episcopal Church. Garrett had served Vice President Nelson Rockefeller in the same capacity in 1975-76, and had worked as a Congressional aide to Reps. William Ayres (R-Ohio) and Shirley Chisholm (D-NY).

Bush's assistant for national security affairs was Nancy Bearg Dyke, who had been principal deputy assistant secretary of the Air Force for manpower resources and military administration in the Carter Administration. Dyke was a veteran of the State Department, the NSC, the Senate Armed Services Committee staff, and the Congressional Budget office.

Bush's executive assistant for Congressional relations was Robert V. Thompson, who had served as Bush's assistant during the presidential campaign. Thompson was from the Tulsa of the Liedtke and Kravis families, where he had founded three companies dealing with commodity speculation, oil rigs, and refrigerator rentals.

Bush's legislative assistant was Susan E. Alvarado, former legislative assistant to the then Senate Minority Whip Ted Stevens (R-Alaska).

Bush's press secretary was Peter Teeley, who had been born in Great Britain and had later lived in Detroit. Teeley had worked for GOP Senators Jake Javits of New York and Robert Griffin of Michigan, and he was considered very much a liberal. Teeley had also been Communications Director for the Republican National Committee.

Bush's deputy press secretary was Shirley M. Green, whom we have seen in action during the March, 1981 attempted coup d'etat. Green had worked at the Texas GOP headquarters in Austin, and had coordinated the Bush for President effort in Texas and Arkansas.

Bush's appointments secretary was the inevitable Jennifer Fitzgerald, who had been his executive assistant during the CIA days in Langley. Fitzgerald had worked as a special aide of former Yale President Kingman Brewster when he was US Ambassador to London. She was a veteran of the White House staffs of the Nixon and Ford years. Jennifer Fitzgerald has remained with Bush over the years, and her presence has given rise to much gossip.

Bush's director of administration was Susan Cockrell, who had worked in vice presidential national security and foreign affairs staffs since 1974, serving Gerald Ford, Nelson Rockefeller, and Walter Mondale before Bush.

Bush's advance man was Michael Farley, a former Arizona insurance agent and broker who had worked for Ford in 1976 and for Bush during the 1979-80 campaign.

Bush's trip director was Joseph W. Hagin, a former operative for the Bush campaign in Florida and Iowa. After the Detroit convention, Hagin travelled full time with Bush. [fn 26]

After Reagan had recovered, Bush customarily arrived at his office in the Old Executive Office Building at about 7:30 each morning for his own national security briefing and a staff meeting. Then Bush and Murphy would go over to the Oval Office, less than a hundred yards away, to sit in on Reagan's national security briefing. During the rest of the day, depending on the requirements of intrigue and manipulation, Bush was free to float between OEOB and West Wing, often gravitating back towards his own staff at the end of the day.

Bush had a standing invitation to sit on all cabinet meetings and other executive activities, and Baker was always there to make sure he knew what was going on. Bush was a part of every sesssion of the National Security Council. Bush also possessed guaranteed access to Reagan, in case he ever needed that: each Thursday Reagan abnd Bush would have lunch alone together in the Oval Office.

Each Tuesday, Bush attended the weekly meeting of GOP committee chairmen presided over by Senate Majority Leader Howard Baker at the Senate. Then Bush would stay on the Hill for the weekly luncheon of the Republican Policy Committee hosted by Sen. John Tower of Texas. Before and after these weekly events, there was time for meetings with individual senators. Bush also cultivated his older House networks, including through paddleball workouts in the House gymnasium.

Prescott's old friend William Casey was beginning to work his deviltry at Langley, and kept in close touch with Bush. Reports of personality conflicts between Bush and Casey are the most transparent disinformation.

The result was a machine capable of steering many of the decisions of the Reagan Administration. At this point, Bush was not looking for a great deal of publicity; he didn't need it. "Bush himself reacted with sensitivity to the amount of publicity he received while performing as a presidential surrogate while Reagan was recovering from his gunshot wound. When the President returned to his work schedule, Bush asked his staff to cut back on scheduling him for interviews. "He thought he should lower his profile for a while,' an aide explained."

Problems might have come from the oversight functions of the Congress, but the Congress was now in the process of being destroyed as a Constitutional force. Senator Harris Williams of New Jersey was now on trial on charges resulting from the FBI's illegal "Abscam" entrapment operations. Williams' forced resignation from the Senate, after a number of Congressmen had been convicted on the same maufactured charges, would complete the subordination of Congress to police state controls.

Problems might have come from the Director of the National Security Council, but here the job had been downgraded: Richard Allen reported not to Reagan, but to Meese. Allen would in any case soon be ousted from office becase he had accepted some watches from Japanese visitors. Allen would be followed in quick succession by William Clark, Bud McFarlane, John Poindexter, Frank Carlucci, and Colin Powell- a new NSC director a bit more than once a year. For Bush, the dangerous one had been Clark; the rest were quite prepared to go with the Kissinger line. In any case, this merry-go-round at the NSC meant that no serious challenge could emerge against Bush from this quarter.

It took more than a year to finish off Al Haig. The final opportunity came during the Malvinas (or Falklands) war in the spring of 1982. When Thatcher made clear that she was intent on waging war against Argentina, Haig flew to London and assured her that there would be no new Suez, that the US would back Britain in the end. But Haig insisted on posing in public as an honest broker, mediating between Britain and Argentina, and made proposals that involved concessions which enraged Thatcher. Haig also called Lord Carrington a "duplicitious bastard." Bush and Baker used the failure of Haig's shuttle diplomacy in the Malvinas crisis to prepare the final bureaucratic coup de grace. Haig was replaced by George Shultz, a Bechtel executive and Nixon cabinet retread.

The loudest squawking in public about Bush's formidable behind the scenes power during the Reagan years came from the old "New Right" alumni of the Young Americans for Freedom during the Goldwater era. One gathers that these personages were miffed at the idea that George's networks were grabbing plum jobs which the old YAFers regarded as their eminent domain. One of these was Terry Dolan of the National Conservative Political Action Committee, who spoke in 1982 of the "Bushization of the Reagan Administration." (Dolan later died of AIDS.) The right-wing direct mail fundraiser Richgard Viguerie asserted that "this is a Bush administration, not a Reagan administration."

The right-wing concern was summed up by Witcover and Germond: "George Bush is playing possum, acting the amenable helpmate to Reagan while insidiously planting his agents in key positions in the administration-- especially in the White House-- and, more recently, in the Republican National Committee." [fn 27]

These circles pointed to the ascendancy of James Baker in the White House, the influence of David Gergen as White House director of communications, the position of Richard Darman (from the Eliot Richardson stable) as Baker's deputy, and the dominance of Rich Bond, Bush's chief of staff, as deputy chairman of the Republican National Committee. Some were also worried about the power of David Stockman, the austerity ideologue of the early Reagan Office of Management and Budget and close Bush ally. "Bush has been more effective in getting his people placed in the administration than Reagan has," complained Paul Weyrich of the Committee for the Survival of a Free Congress. "There was a tremendous power vacuum and Baker's moved into it, but Baker has used it to get Bush people into key places...Bush has an ideal situation. He goes around the country collecting due bills by expressing support of Reagan, meanwhile putting his people in place." These circles were very concerned by the frequent rumors that Reagan might renounce a race for a second term in what Viguerie called an "LBJ scenario," with Reagan dropping out during the primary season. These hopes never panned out, but the "Baker-Bush connection" enraged the right wingers for years.

In public, Bush worked on his Task Force for Regulatory Relief, a good way to curry favor with the legions of greed in Wall Street and Beverly Hills who were looking for the Reagan administration to fulfill their hopes. After the French elections, it was Bush who was despatched to France to meet the new French President Francois "Tonton" Mitterrand of the Grand Orient freemasonry. Bush and Mitterrand had mutual friends in the Schlumberger interests of Jean and Monique de Menil of Houston; Bush began building a special relationship with Tonton Mitterrand that included very cordial Franco-American summits at Kennebunkport and St. Martin during 1989. For Tonton, close ties with Bush were essential for undoing the heritage of General de Gaulle, who had insisted on French national independence and sovereignty. With the Bush-Mitterrand axis, those forces were strenghened who wanted France to become again what she had been in the shameful adventure of Suez in 1956: an auxiliary to the Anglo-Americans.

Bush also had a special interest in the Atlanta murders of black children, which were reaching their peak during the first months of 1981. On February 8, 1981, Bush announced that the federal government would provide special assistance to the Atlanta Police Department in investigating the murders. On February 22, a federal task force focussed on Atlanta was created, and on March 15 George and Barbara journeyed to Atlanta to meet with the families of some of the victims. These murders were clearly connected to satantic cults operating in the Atlanta area.

Bush became heavily engaged on this front. His office "aggressively and publicly" pursued his assignment of coordinating federal asssistance to Atlanta. Admiral Murphy and staffer Thaddeus Garrett helped to arrange a series of grants from various agencies and set up a task force on the ground in Atlanta under the leadership of Charles Rinkevich, a regional official of the Justice Department. Garrett gave himself credit for expediting $3.8 million to support the investigation of the Atlanta murders and to provide "support and protective supervision" for the terror-stricken residents of the area.

Naturally: an alumnus of Skull and Bones knew all about satanism.

Forty-four days after the attempted assassination of Reagan, there followed the attempt to assassinate Pope John Paul II during a general audience in St. Peter's Square in Rome. During those 44 days, Bush had been running the US government. It was as if a new and malignant evil had erupted onto the world stage, and was asserting its presence with an unprecedented violence and terror. Bush was certainly involved in the attempt to cover up the true authors of the attentat of St. Peter's Square. An accessory before the fact in the attempt to slay the pontiff appears to have been Bush's old cohort Frank Terpil, who had been one of the instructors who had trained Mehmet Ali Agca, who had fired on the pope.

After a lengthy investigation, the Italian investigative magistrate Ilario Martella in December 1982 issued seven arrest warrants in the case, five against Turks and two against Bulgarians. Ultimate responsibility for the attempt on the Pope's life belonged to Yuri Andropov of the Soviet KGB. On March 1, 1990, Viktor Ivanovich Sheymov, a KGB officer who had defected to the west, revealed at a press conference in Washington DC that as early as 1979, shortly after Karol Woityla became Pope, the KGB had been instructed through an order signed by Yuri Andropov to gather all possible information on how to get "physically close to the Pope. [fn 28]

According to one study of these events, during the second week of August, 1980, when the agitation of the Polish trade union Solidarnosc was at its height, the Pope had despatched a special emissary to Moscow with a personal letter for Soviet President Leonid Brezhnev. The Pope's message warned the Soviet dictator that if the Red Army were to invade Poland, as then seemed imminent, the Pope would fly to Warsaw and lead the resistance. It is very likely that shortly after this the Soviets gave the order to eliminate Pope John Paul II. [fn 29]

With the Vatican supporting Judge Martella in his campaign to expose the true background of Ali Agca's assault, it appeared that the Bulgarian connection, and with it the Andropov-KGB connection, might soon be exposed. But in the meantime, Brezhnev had died, and had been succeeded by the sick and elderly Konstantin Chernenko. Bush was already in the "you die, we fly" business, representing Reagan at all important state funerals, and carrying on the summit diplomacy that belongs to such occasions. Bush attended Brezhnev's funeral, and conferred at length with Yuri Andropov. Chernenko was a transitional figure, and the Anglo-American elites were looking to KGB boss Andropov as a desirable successor with whom a new series of condominium deals at the expense of peoples and nations all over the planet might be consummated. For the sake of the condominium, it was imperative that the hit against the Pope not be pinned on Moscow. There was also the scandal that would result if it turned out that US assets had also been involved within the framework of derivative assassination networks.

During the first days of 1983, Bush lodged an urgent request with Monsignor Pio Laghi, the apostolic pro-nuncio in Washington, in which Bush asked for an immediate private audience with the Pope. By February 8, Bush was in Rome. According to reliable reports, during the private audience Bush "suggested that John Paul should not pursue quite so energetically his own interest in the plot." [fn 30]

Bush's personal intervention had the effect of supplementing and accelerating a US intelligence operation that was already in motion to sabotage and discredit Judge Martella and his investigation. On May 13, 1983, the second anniversary of the attempt on the Pope's life, Vassily Dimitrov, the first secretary of the Bulgarian Embassy in Rome, expressed his gratitutde: "Thanks to the CIA, I feel as if I were born again!"

Bush consistently expressed skepticism on Bulgarian support for Agca. On December 20, 1982, responding to the Martella indictments, Bush told the Christian Science Monitor: "Maybe I speak defensively as a former head of the CIA, but leave out the operational side of the KGB-- the naughty things they allegedly do: Here's a man, Andropov, who has had access to a tremendous amount of intelligence over the years. In my judgment, he would be less apt to misread the intentions of the USA. That offers potential. And the other side of that is that he's tough, and he appears to have solidified his leadership position."

According to one study, the German foreign intelligence service, the Bundesnachrichtendienst, believed at this time that "a common link between the CIA and the Bulgarians" existed. [fn 31]

Martella was convinced that Agca had been sent into action by Sergei Antonov, a Bulgarian working in Rome. According to author Gordon Thomas, Martella was aware that the White House, and Bush specifically, were determined to sabotage the exposure of this connection. Martella brought Agca and Antonov together, and Agca identified Antonov in a line-up. Agca also described the interior of Antonov's apartment in Rome. "Later, Martella told his staff that the CIA or anyone else can spread as much disinformation as they like; he is satisfied that Agca is telling the truth about knowing Antonov." [fn 32] Later US intelligence networks would redouble these sabotage efforts with some success. Agca was made to appear a lunatic, and two key Buglarian witnesses changed their testimony. A campaign of leaks was also mounted. In a bizarre but significant episode, even New York Senator Al Damato got into the act. Damato alleged that he had heard about the Pope's letter warning Brezhnev about invading Poland while he was visiting the Vatican during early 1981: as the New York Times reported on February 9, 1983, "Damato says he informed the CIA about the letter and identified his source in the Vatican when he returned to the US from a 1981 trip to Rome." Later, Damato was told that the Rome CIA station had never heard anything from Langley about his report of the Pope's letter. "I gave them important information and they clearly never followed it up," complained Damato to reporters.

In February, 1983, Damato visited Rome once again on a fact-finding mission in connection with the Agca plot. He asked the US Embassy in Rome to set up appointments for him with Italian political leaders and law enforcement officials, but his visit was sabotaged by US Ambassador Maxwell Raab. The day before Damato was scheduled to leave Washington, he found that he had no meetings set up in Rome. Then an Italian-speaking member of the staff of the Senate Intelligence Committee, who was familiar with the Agca investigation and who was scheduled to accompany Damato to Rome, informed the senator that he would not make the trip. Damato told the press that this last-minute cancellation was due to pressure from the CIA.

Much to Damato's irritation, it turned out that George Bush personally had been responsible for a rather thorough sabotage of his trip. Damato showed the Rome press "a telegram from the American Ambassador in Rome urging him to postpone the visit because the embassy was preoccupied with an overlapping appearance by Vice President Bush," as the New York Timnes reported. This was Bush's mission to warn the Pope not to pursue the Bulgarian connection. Damato said he was shocked that no one on the CIA staff in Rome had been assigned to track the Agca investigation.

The CIA station chief in Rome during the early 1980's was William Mulligan, a close associate of former CIA deputy assistant director for operations Theodore Shackley. Shackley, as we have seen, was a part of the Bush for President campaign of 1980.

Mehmet Ali Agca received training in the use of explosives, firearms, and other subjects from the "former" CIA agent Frank Terpil. Terpil was known to Agca as "Major Frank," and the training appears to have taken place in Syria and in Libya.

Agca's identification of Terpil had been very precise and detailed on Major Frank and on the training program. Terpil himself granted a television interview, which was incorporated into a telecast on his activities and entitled "The Most Dangerous Man in the World," during which Terpil described in some detail how he had trained Agca. Shortly after this, Terpil left his apartment in Beirut, accopanied by three unidentified men, and disappeared. Terpil and Ed Wilson had gone to Libya and begun a program of terrorist training at about the time that George Bush became the CIA director. Wilson was indicted for supplying explosives to Libya, for conspiring to assassinate one of Qaddafi's opponents in Egypt, and for recruiting former US pilots and Green Berets to work for Qaddafi. Wilson was later lured back to the US and jailed. Terpil presumably continues to operate, if he is still alive. Was Terpil actually a triple agent?

What further relation might George Bush have had to the attempt to take the life of the Pope? As we have seen, the Bush family had carried on an obsessive vendetta against the Vatican over decades. In the family tradition, it was Catholic opponents of birth control and genocide, including Roman Catholic prelates, who were held responsible for the defeat of Prescot Bush in the 1950 election, when his involvement with the genocide lobby had received effective and timely exposure. We have seen how Bush personally nursed this grudge, hysterically recounting the story to his colleagues in the House of Representatives. We have seen Bush's enraged response to Pope Paul VI's encyclical Humanae Vitae, which attacked the racist heart of the Bush family creed. We will later see Bush attacking the political activities of Jesuits in central America. We will see Bush ordering violent demonstrators in Panama City to storm the Papal nunziatura. In all of this the freemason Bush shares the obsession of the Anglo-American elite, who are committed to destroying the papacy as one of the few institutions in the world that has dared to resist their Malthusian proposition that the central problem of humanity is overpopulation.

Freemason George Bush allegedly possesses important connections to some of the more sinister currents of continental European masonry. Unconfirmed published reports have linked George Bush to the Propaganda Due or P-2 masonic lodge of Rome, Italy, as well as to the Comite Montecarlo. Barbara Honegger, in her book October Surprise, cites her mysterious informant "Y", who claims that the notorious Italian political fixer Francesco Pazienza told him that George Bush was even made an honorary member of the P-2 lodge by that lodge's venerable grand master, the notorious Licio Gelli. Gelli is also reported by informed sources to have worked energetically to promote Bush's 1980 presidential candidacy.

Some see Bush's alleged connections to Licio Gelli's P-2 lodge as relevant to the assassination of Swedish Prime Minister Olof Palme on February 28, 1986. According to Barbara Honegger's mysterious informant "Y", on February 25, 1986, just a few days before Palme was killed, Licio Gelli, who was then in Brazil, sent a message to Philip Guarino, a former official of the Republican National Committee telling him that "the Swedish tree will be felled," along with a request to "tell our good friend Bush." [fn 33] Palme, at the time of his death, was aware of the participation of Swedish arms companies in weapons deliveries to the Khomeini regime within the framework of what later became known as Iran-contra.

On July 2, 1990, the first program (Tg-1) of RAI Television, the Italian government-sponsored network, broadcast an interview by journalist Ennio Remondino with Ibrahim Razin and Richard Brennecke, a former US intelligence agent who has become well known in connection with his allegations concerning the 1980 October Surprise. Here Razin repeated the account of the message from Gelli to Guarino and Bush just summarized. Brennecke added that US intelligence agencies provided the P-2 lodge with funding in the amount of $10 million per month for gun-running, drug-running, and destabilization. In the wake of this telecast, President Francesco Cossiga, the psychologically unstable Italian chief of state, demanded that Prime Minister Giulio Andreotti investigate these charges. Cossiga was indignant that both the US government and George Bush had been accused of these heinous crimes. Andreotti's investigation was a superficial one and certainly did not disprove any of the charges, leaving the matter hanging. [fn 34]

Return to the Table of Contents


1. Joan Quigley, "What Does Joan Say" (New York, 1990), p. 112.

2. Clay F. Richards, "George Bush: 'co-president' in the Reagan administration" United Press International, March 10, 1981.

3. Alexander Haig, Caveat (New York, 1984), p. 54.

4. Haig, Caveat, p. 115.

5. Haig, Caveat, p. 302.

6. Haig, Caveat, p. 60.

7. Washington Post, March 22, 1981.

8. Haig, Caveat, pp. 144-145.

9. Washington Post, March 22, 1981.

10. The Daily Texan, March 31, 1981.

11. Haig, Caveat, p. 151.

12. Caspar Weinberger, Fighting for Peace (New York, 1990), p. 91.

13. Weinberger, Fighting for Peace, p. 93.

14. Weinberger, Fighting for Peace, p. 94.

15. Donald T. Regan, For the Record (New York, 1988), p. 168.

16. Weinberger, Fighting for Peace, p. 95.

17. Washington Post, April 1, 1981.

18. Haig, Caveat, p. 160.

19. Ronald Reagan, An American Life (New York, 1990), p. 271.

20. Jack and JoAnn Hinckley, Breaking Points (Grand Rapids, Michigan, 1985), p. 169.

21. Breaking Points, p. 215.

22. Judy Hasson, United Press International, July 31, 1985.

23. Joan Quigley, What Does Joan Say? (New York, 1990), p. 12.

24. Newsweek, April 20, 1981, p. 29.

25. Weinberger, Fighting for Peace, pp. 230-231.

26. For Bush's staff see "George Bush--Keeping His Profile Low So He Can Keep His Influence High," National Journal, June 20, 1981, p. 1096 ff.; and Arthur Wiese, "The Bush Team," Houston Post, April 1, 1981.

27. Jack W. Germond and Jules Witcover, "Why Do Conservatives Hate Bush?", The Washingtonian, April 1982.

28. Washington Post, March 2, 1990.

29. See Gordon Thomas, Pontiff (New York, 1983).

30. Gordon Thomas, Averting Armageddon (New York, 1984), p. 74.

31. Averting Aramgeddon, p. 268.

32. Averting Armageddon, p. 75.

33. Barbara Honegger, October Surprise (New York: Tudor Publishing, 1989), p. 240. Many are the names that have been attributed to informant "Y," including Ibrahim Razin, Racine, Oswald Le Winter, Oscar LeWinter, and George Cave, who was supposedly once a CIA employee specializing in Iranian affairs.

34. See Corriere della Sera and La Stampa, July 24, 1990.

Return to the Table of Contents

"Voter Education is the Key - What is Treason?"

Welcome to the GWB Right House. The GWB Right House web site is dedicated to exposing the truth about George W. Bush (GWB), his extreme right-wing agenda, and his likely effect on some of the major issues. Executive Summary Page / How To Get Involved / E-mail GWB Right House

GWB's History

George W. Bush has a very long and clear history of making lots of money and achieving high political office with the help of family friends and wealthy corporate special interest. Nepotism and campaign contributions are not illegal, however, the appearance of conflict of interest can, and often does, indicate possible corruption. Many of GWB's presidential campaign proposals contradict many of his actions as Governor of Texas. GWB claims that he is going to tear down the toll-roads to the middle class and yet his tax cut proposals give the biggest benefit to billionaires. GWB claims that he is a reformer and yet his proposals could return this country to the failed policies and huge deficits of the Reagan/Bush years. GWB proposes to reform Social Security by adding a new level of cost and risk. GWB said that he is going to be the education president, but his proposals would take money out of the already under-funded public school system. GWB wants to let the "armies of compassion" deal with the poor and needy in our society and at the same time he is going to repeal the estate tax that has encouraged charity to these same organizations. Don't be fooled by GWB's "compassionate conservative" label, his slick campaign proposals, or his promise of honor, dignity and integrity, his history, and the Republican parties history, just doesn't support such claims as being creditable. GWB's History Page

GWB On The Issues

Education has never been one of GWB's strong points, as a student or a political leader. Texas ranks right near the bottom of the list in education and GWB has not managed to improve the system much. As Governor, GWB appears much more interested in tax cuts for property owners then in improving the educational system in Texas. GWB's support of school choice, school vouchers, and corporations running public schools, are not the answers to improving our children's educations, click on the link to learn why.
Social Security
GWB recently announced his plan to allow individuals to invest part of their Social Security taxes into personal savings accounts. It sounds like a good idea, but it's not. GWB's plan amounts to a false promise of security that will cost hundreds of billions to create and operate. His plan could result in the need to bail-out the SS system at a cost of hundreds of billions of dollars. Do you remember the S&L; bail-out that cost taxpayers $500 billion? Do you remember who was in office when that costly de-regulation mistake took place? I bet GWB's daddy remembers.
It appears that big tax cuts for rich people is the defining issue, sole purpose, and top priority for GWB and most of the Congressional Republicans. I suspect that if GWB and his friends in the Congress get their way the rich will be paying far less in taxes, the federal government will return to deficit budgets, and our children will get stuck with a bigger debt to deal with, or worse, a bankrupt government. Giving the Republicans the label of "fiscal conservatives" is misleading and a misnomer. Their voting record, and track record, does not support that label.
Campaign Finance Reform
GWB's supports campaign finance reforms, but his proposals will not stop, or even slow down, the huge amounts of money our elected officials need to raise to run for public office. GWB decided not to limit his campaign contributions so that he could raise a record amount of money, which he has already done. If the amount of money a politician raises is equal to the level of their corruptibility, I think we have a new leader in the pack. This country needs to move to a system of total public campaign financing and eliminate the need for our elected officials to raise money.
Texas is one of the major gateways for illegal immigrants and illegal drugs coming into America. I suspect that many of the Texas based construction companies, the large Texas based real estate owners, and the Texas based crime families have unfairly benefited financially from the cheap labor pool and illegal drugs that flood across the Texas border everyday. Can GWB help the American people with this problem, or will he make it more of a problem? Since GWB took over as Governor of Texas teen drug use has been on the rise.
Crime is down in Texas, but it is down even further nationally thanks to Bill Clinton and Al Gores efforts. GWB said that he wants to get tougher on criminals, but his lack of support for Texas hate crime legislation paints a different picture. The biggest crime in this country is treason. Do you think that if GWB cuts taxes and increases spending to the point of bankrupting our government, so that his rich Texas friends can pick up the pieces for pennies on the dollar, that his actions are treasonous?
Foreign Trade
GWB is a big supporter of the free trade. His daddy was a big support of NAFTA and now most of the fortune 500 companies have set-up factories in Mexico. Now there is a big push to expand NAFTA to other poor and pass a new free trade deal with China. Who do you think will win in a GWB trade deal, large multinational corporations or workers? Free trade is a bad for American workers, it is bad for the global environment, and it is bad for human rights.
Health Care
As Governor of Texas GWB consistently sided with the HMO's over the rights of patients claiming that the legislation would increase cost. Do you think that consumers should be able to hold their HMO's accountable? Do you feel more comfortable with Doctors or HMO's making decisions about what is best for you? This country needs to move to a national health care system where every person is covered and families are not forced into bankruptcy to pay medical bills because someone they care about got sick.
Tort Reform
GWB is a big supporter of the tort reforms and was very successful in getting tort reform legislation passed in Texas. Limiting the liability for irresponsible corporations is not what I would call good democratic self-government legislation. GWB's tort reforms limit the ability of juries to award judgements against irresponsible corporations. Tort reform is a step backwards for our system of justice.
GWB is against most abortions. Taking away a women's right to choose is not progress for women or our society. Our current level of technology allows doctors and patients to better predict the health of the unborn child and abortion should always be an option for health reasons. In addition, there are over six billion people in the world and birth control and abortion services will help societies control the problem of over population.
Capital Punishment
Texas leads the nation in executions and in the number of people on death row. In a recent interview GWB mocked the plea of a women scheduled to die. GWB's behavior is a far cry from his self proclaimed label of being a compassionate conservative. Our system of justice is flawed and the death penalty is unfair and discriminatory. One innocent person put to death is one to many. Do you think that Jesus would agree with that? Imagine all the garbage these criminals could recycle during their life times in prison. Imagine all the financial payments these criminals could earn and pay to their victims by working them in garbage recycling operations. Lets use this human capital and not waste it.
Estate Taxes
GWB wants to repeal the estate tax. Not only is this a bad idea for the future of democracy but it will destroy opportunities for average Americans to create new wealth; It will allow wealth to become monopolized into the hands a few families; It will eliminate the incentive for rich families to give some of their wealth to charities; It will further shift the tax burden from the rich to the middle class and the poor; It will reduce our governments ability to fund the programs and services that we have come to expect from our government. Kids who inherit huge amounts of wealth can afford to pay this highly progressive tax and they should be required to pay this tax. The estate tax should be reformed to eliminate small estates from this tax, and not repealed.
Minimum Wage
GWB, like most of the Republicans in Congress, supports a small increase in the minimum wage if it is spread out over several years, if it includes billions of dollars in tax cuts, and if the individual States are allowed to opt out of the increase if they want. This is a shameful position when you consider the fact that our members of Congress continue to vote themselves big raises on top of their big salaries ($141,000) and yet they refuse to pass a minimum wage that is above the poverty level. How can the Republicans continue their relentless fight for tax cuts for rich people and ignore the needs of average working Americans? Who in Congress is looking after the interest of workers?
Oil & Gas
GWB and Dick Cheney both have long histories with the oil and gas industry. GWB's policies in Texas has resulted in Texas taking the lead in pollution caused by these industries. Many of the companies in this industry are making hundreds of millions of dollars off natural resources taken from government owned lands (the people's land) and are paying very little royalties to the government. Companies in these industries receive preferential tax treatment that saves them tens of millions in taxes and discourages development of clean energy alternatives. When are we going to elected people who will stand up the these big rich oil companies?

Links to Other GWB Web Sites

Other Political Links

GWB's Helpers & Others

GWB's Big Money Supporters: Enron Corp. - Sanchez family - Vinson & Elkins LLP - Hicks, Muse, Tate & Furst Inc. - Bass Family - The Sterling Group - MBNA Corp. - Pilgrims Pride - Farmers Insurance Group, Inc. - Sam & Charles Wyly, Jr. - Arter & Hadden LLP - Bank of America - Andersen Worldwide - Baker & Botts - Denitech Corp. - Jenkens & Gilchrist - Beecherl family - Locke, Liddell & Sapp - Union Pacific Corp. - Peter & Edith Jones O'Donnell - Texas Utilities Co. - Anheuser-Busch Co. - Robert McNair & Family - Crescent Real Estate Equities Co. - Hixon Properties, Inc - and others.

GWB's Hired Help: (The Iron Triangle) Karl Rove - GWB's Campaign Chief Strategist, former tobacco company advisor who is credited with helping Republicans win the majority in a number of Texas public offices. Some say he is ruthless, power-hungry, and will do whatever it takes to win. He already has a reputation for political dirty tricks but he claims that it was just youthful pranks. He has been involved with the Bush family since 1973. Karen Hughes - GWB Communications Director, she is another extreme right-wing Republican housewife brown-noser out of SMU with very little education. In 1984 she began working as the Texas press coordinator for the Reagan-Bush campaign and in 1992 as executive director of the Texas Republican Party. Joe Allbaugh - GWB's Chief of Staff/Security Goon/Campaign Manager, is an oversized pea brained bully out of Oklahoma. He has a long history of political campaign work for Republicans including the Reagan-Bush campaign in 1984.

Notable Money Raising Pioneers: Joe Barton (U.S. Congressman), Lee M. Bass (Oil Billionaire), Louis Beecherl (Oil Millionaire), Nancy Brinker (Brinker International), Robert Dedman Jr. (ClubCorp International), Jennifer Dunn (U.S. Congresswoman), John Engler (Governor of Michigan), R. Steven Hicks (Capstar Broadcasting Co.), Roger Hirl (Occidental Chemical Co.), Bill Owens (Governor of Colorado), Tom Ridge (Governor of Pennsylvania). Also notable is the unusual number of pioneers out of PA and MI and a number of people who were appointed by GWB to the UT board of regents. Link to list of other possible right-wing individuals, companies, and organizations.

Recommended Books About GWB & Others

  1. Fortunate Son: George W. Bush and the Making of An American President - Controversial book about GWB and his possible use of cocaine. by J. H. Hatfield.
  2. Shrub: The Short but Happy Political Life of George W. Bush - Great GWB expose book that shows what a small minded, coat-tail ridding, extreme right-wing follower GWB really is. by Molly Ivins & Lou Dubose.
  3. Plausible Denial - Was the CIA Involved in the Assassination of JFK? - Well researched book that indicates that George Bush was working for the CIA at the time of the JFK assassination and that the CIA might have been involved. by Mark Lane.
  4. The Texas Connection - Excellent book about a possible Texas based conspiracy that might have been behind the assassination of JFK in Dallas, Texas in 1963. by Craig Zirbel.
  5. Who Robbed America? A Citizen's Guide to the Savings & Loan Scandal - This book points to who was responsible for biggest white-collar crime in history that occurred during the Reagan/Bush administrations years and why the America taxpayers got stuck with a $500 billion dollar bill from this Texas based looting. by Michael Waldman with introduction by Ralph Nader.
  6. From Freedom to Slavery - A book that looks at the story of white separatist Randy Weaver and how our government misused its police powers that led to the death of Randy's wife, son, and dog. by Gerry Spence.
  7. The Oklahoma City Bombing and the Politics of Terror - This book uncovers some new facts that indicates a possible government conspiracy and cover-up in the Oklahoma City bombing. by David Hoffman.
  8. George Bush - The Unauthorized Biography - This is a well researched frightening account of the Bush families involvement in banking with the Nazi's before and during WWII and their connections to other highly suspect extreme right-wing people and organizations. by Webster Tarpley & Anton Chaitkin.
  9. Why Didn't You Get Me Out? - This a an real life account from a POW survivor of the Vietnam War who claims that the U.S. government failed him and other POW's during and after the war. by Frank Anton.
  10. A Place Called Waco: A Survivor's Story - This book is from one of the nine survivors of the ATF, FBI, and DOJ's raid, stand-off, and final deadly assault on the God fearing, gun loving Branch Davidians at Mount Carmel in Waco, Texas in 1993. by David Thibodeau & Leon Whiteson.
  11. Firewall: The Iran-Contra Conspiracy and Cover-Up - This book is from the independent counsel who investigated this Reagan/Bush led plan to subvert the U.S. Congress and our laws in a ends justifies the means criminal action. Walsh argues that he and his staff were blocked by lies, cover-ups, and Bush's pardons. by Lawrence E. Walsh.
  12. The Final Days - This book is about President Richard Nixon and the crimes, cover-up, misuse of power, and lies that led to his resignation. by Bob Woodward & Carl Bernstein.
  13. United We Stand - How We Can Take Back Our Country - A really good easy to read book by a man who has proven time and again that he is a true pro-active America who cares about this country, its laws, and the people who live here. by Ross Perot.
  14. Agents of Influence - How Japan's Lobbyists in the U.S. Manipulate America's Political and Economic System - This book explains just what the title suggest. by Pat Choate.
  15. Earth In The Balance - Ecology and The Human Spirit - This book clearly explains the trends taking place in our environment as a result of human activities and what we need to start doing differently to protect the earth for future generation. by Al Gore.
  16. George W. Bush - The Billionaire's Politician Puppet - This is a book I wrote that looks at the dark side of the man who is really just a puppet for a few families worth hundreds of billions of dollars and want more, much more. by Chris Fick.

Political Parties

Republican Party
The Republican party has become the party that supports the needs and wants of billionaires. Their legislative actions prove that they cannot be considered the party of financial conservatism. Their priorities appear to be centered about tax cuts for the wealthiest Americans regardless of the cost. They have opposed common sense gun control, hate crime legislation, increases in the minimum wage, and increases in education.
Democrat Party
The Democrats are not much better then the Republicans, but they have proven that they are the party of smaller government, lower deficits, stronger Social Security, better health care, proper financial management, campaign finance reform, and a higher minimum wage.
Reform Party
The Reform Party without Ross Perot is like a ice cream without the cream. They have a great platform but have lost their luster without Ross leading the way. Pat Buchanan and John Hagelin are both extreme right-wingers who promote 90% good proposals, but it is their 10% bad proposals that expose their real right-wing goals. Don't be fooled by these reformers, they appear to be Republicans in disguise.
Green Party
Ralph Nader has given the Green Party vision and direction. The Green Party has a great platform and is educating a lot of Americans about how wealthy individuals and large corporation are corrupting the political process and are hurting workers.
Libertarian Party
This party is an extreme right-wing Republican type party selling the same phoney Republican platform using the same Republican rhetoric, with the exception of their position on illegal drugs. Don't be fooled by the freedom and liberating themes, this parties platform will not deliver those types of results.

Authors Info

I am an independent voter who has voted for Republicans, Democrats, Reformers, Libertarians, and Independents in the past. This time I like Ralph Nader and the Green Parties platform, but I am a realist so I will vote for the lesser of the two major evils rather then wasting my vote. For more information about me, or to contact me, click on the following links: About the Author / My Other Political Thoughts Articles and Letters / My GWB Humor Page / My Political Art Page / E-mail me /

Read the frightening story about GWB and the Bush families involvement in the S&L; crisis. Learn about corporate welfare waste and the political corruption our campaign financing system is causing. Look at the real Republican's Congressional record and their ruthless billionaire friends who might be trying to steal our governments (the people's) most valuable assets. Finally, know how to get involved to stop the looting of our government before its to late.

Next Page

GWB Right House - Executive Summary Page - GWB's History - GWB Issues - GWB Links - GWB Supporters/Helpers/Backers - Recommended Books - Political Parties - Issue Pages - Education - Health Care - Taxes - Foreign Trade - Death Penalty - Campaign Finance Reform - Social Security - Tort Reform - Crime - Immigration - Abortion - Estate Taxes - Minimum Wage - Oil & Gas - Political Party Pages - Republican Party - Democrat Party - Reform Party - Green Party - Libertarian Party - Other Pages - About the Author - Other Political Links - Other Political Thoughts - GWB Humor Page - Political Art Page - "New" My Bush Book Online "New" - e-mail GWB Right House - How To Get Involved

The information on the GWB Right House web site is for issue advocacy only. The GWB Right House web site does not accept any contributions and it does not support any candidates. Please feel free to share your thoughts and ideas with me. Thanks, and come again soon. e-mail GWB Right House

Copyright by CMF Enterprises 2000, P.O. Box 1935, Frisco, TX 75034


Reality Check

The Clinton File: Whitewater vs. Watergate

      Lie #1: There is no comparison between the two (investigations): Whitewater is about an innocent sexual dalliance and Watergate was about lying to the public, obstructing justice, and misuse of power.
      The truth: There is no comparison - Whitewater is about a long line of major felony crimes committed by and/or to the benefit and/or behest of William Jefferson Clinton; Watergate was about a bungled act of misdemeanor burglary: the theft of a personal telephone book kept in a secretary's desk in the Democratic Party's offices.
      The Whitewater fraud - which was conceived from the beginning to be a masssive financial fraud for the direct and personal enrichment of William Jefferson Clinton and his friends and co-conspirators, that was created to be that fraud, and that was operated as that fraud - cost the American taxpayers far in excess of $60 million (that was only the final payment, the last bill); the address book at the Watergate cost less than $5.00 and was paid for with private funds.
      Bill Clinton was and remains the focus of the Whitewater investigation; Richard Nixon was not the focus of the Watergate investigation and was never implicated in or accused of involvement with it.

      There is no comparison between the two investigations.

      Lie #2: It's [the Whitewater investigation] only about sex and his sex life is nobody's business.
      The truth: It (the investigation) has nothing to do with sex: Ken Starr has not been investigating Clinton's sex life. Ken Starr is concerned with bringing a career felony criminal to justice. ["felony n: 2 a: a grave crime formerly differing from a misdemeanor under English common law by involving forfeiture in addition to any other punishment b: a grave crime declared to be a felony by the common law or by statute regardless of the punishment actually imposed c: a crime declared a felony by statute because of the punishment imposed d: a crime for which the punishment in federal law may be death or imprisonment for more than one year"]. Clinton is not being charged with having sex, legal or illegal!
      It is not about sex!

      It is about lying. Specifically, lying during sworn testimony while under oath in a court of law, thereby committing perjury, a felony crime. ["perjury n: the voluntary violation of an oath or vow either by swearing to what is untrue or by omission to do what has been promised under oath: false swearing"] NOTE: "Perjury" includes the failure "to do what has been promised under oath"! Clinton's oath prior to testifying was "to tell the truth, the whole truth, and nothing but the truth." Yet, in press conferences and public appearances after his testimony to the grand jury, Clinton has smugly stated that he "had no obligation to tell (Ken Starr) everything" - a blatant and boastful admission that he got away with refusing to tell "the whole truth"!
      When Bill Clinton publicly admitted "minimizing" his answers - not responding fully and completely - while under under oath, he was in fact admitting to yet another perjury!

      Bill Clinton is observably a congenital liar. A pathological liar. ["congenital adj: 1 a : existing at or dating from birth b : constitutiing an essential characteristic: INHERENT"; "pathological adj: 2 : something abnormal: a : the structural and functional deviations from the normal that constitute disease or characterize a particular disease"]
      Bill Clinton has been a proven liar for all of his known life.

      He may have even lied (probably has/does) about his own paternity.
      According to his "official" biography, his natural father, William Blythe (of whom he does not speak) died tragically in an automobile accident just days before Clinton's birth, leaving his saintly mother (whom he praises effusively and holds up as the epitome of womanhood and motherhood) a pregnant widow. She later married Roger Clinton, whom Bill Clinton has praised and whose surname he legally adopted "in gratitude and in honor."
      Or at least, that's the official story.
      We know (thanks to various and sundry enterprising reporters) that William Blythe had fathered at least 2 other children by 2 different women in 2 separate parts of this nation, and he died by drowning! (What happened - did he drive, drunk, into a canal or river? Was that the "automobile accident"? How else do you drown "from" an automobile accident?
      We also know that his mother "married" at least 5 different men and (at least, during Clinton's time in public offices) spent virtually all of her time drinking, smoking and gambling. (Does this sound a little "dysfunctional" - for a"saint" - to you?)
      And we know that his namesake stepfather was, in fact, a physically abusive and dysfunctional father. (And one network TV news department has reported that Bill Clinton actually legally adopted Roger Clinton's surname after his mother had divorced Clinton. When Clinton no longer was his stepfather!

      Question: Why has Clinton never spoken of his natural father? Why does he pointedly turn his back on the poor victim of cruel fate while he praises an abusive, drunken former stepfather?
      Why does he ignore the poor victim of cruel fate when he praises his drunken, neglectful and dysfunctional mother?
      Why does he legally take the name of an abusive former stepfather and reject the name of his innocent victim natural father?

      Could it be that William Blythe never married Clinton's mother? Could it be that, as the facts suggest, William Blythe wandered around this nation fathering children out of wedlock as he went, and Bill Clinton is one of them?
      Could this be what Bill Clinton secretly holds against his father, the father he (reputedly) never knew?
      It should be noted that Bill Clinton - who is quick to present documentation to support his claims on those rare instances in which supporting documentation actually exists - has never presented a certified marriage license for his mother and William Blythe and has never presented a certified birth certificate for himself listing his parents!
      How about a certified death certificate for William Blythe listing next-of-kin?
      Is our 42nd President the first literal bastard to live in the White House?

      But I digress.
      The question is about lying, not sex! The lying about the sex has to be legally proven in order to establish a "pattern of behavior" of lying.

      Lie #3: But it's a lie about sex! Everybody lies about sex! Nobody cares about it!
      The truth: But people who care about justice do care about it. It is, as was stated earlier, about justice in the multimillion dollar Whitewater criminal swindle!

      Lie #4: But there was/is nothing to Whitewater. They [the independent prosecutor] never found a thing!
      The truth: Ah, but they did! They won over a dozen convictions, and they discovered overwhelming evidence that puts Bill and Hillary Clinton "right smack dab in the middle" of it all. In fact, the only people they didn't get a conviction on (or make a deal with) are named "Clinton."
      Then why weren't Bill and Hillary convicted if there is so much evidence? Because under our legal system, a prosecutor has to prove the charges beyond the shadow of a doubt in order to convict, and that proof requires a confession, the believable eyewitness testimony of a participant in the crime, or incontrovertible physical proof of direct complicity in the crime. The Clintons, under oath, lied. And while their lies were obvious to anyone viewing the evidence, with no insider testifying as to the Clintons' complicity and with "lost" records, the only course left to the prosecution is to prove a pattern of lying. A pattern of lying as in the Paula Jones civil trial and as in the grand jury probe.
      Bill Clinton is, by 20 years' worth of anecdotal, coincidental, and empiric evidence, guilty of being, by choice, a career felon. He is every bit as evidentially a career felon as Al "Scarface" Capone was. And like Capone, Clinton has never been convicted for his felony crimes - observably because, like Capone, he entered into his life of crime consciously and deliberately. Consequently every step he has taken has been covered up in advance of that step! Covered up by falsified records, by destruction of records, by money, by collusion, and - when all that fails - by threat!

      Al Capone was a mafioso gangster, a lifetime career criminal, and everyone in America knew it. Everyone in any other country who had reason to be "up" on news from America knew it, too. There was no doubt. Anonymous stories from within the mafia circulated regularly. People from the neighborhoods passed along tales, sometimes in admiration, sometimes in fear. Reporters found informers from within the gangs and from among the victims. Despite the lack of any conviction, there was and is no credible doubt!
      Capone apparently joined the gangs while still a teenager: the actual year is not known. But the year he turned 21 (1920) he became a lieutenant in the Johnny Torrio gang in Chicago. And in 1925 he became leader of the Torrio gang, directing bootlegging, prostitution, gambling, extortion, and even the murder of competitors, people who resisted him, and potential witnesses against him, and all just for the money and the power.
      And this was all common knowledge. The people knew it, the police knew it, every judge knew it, and every juror knew it. But with all those people who knew the truth, try as they might (and they did, for several years) the famed Elliot Ness and the entire federal government could not convict Al Capone of so much as spitting on the sidewalk! Capone, his men, and his lawyers lied in court, and with no witnesses - gangsters or otherwise - willing or able to testify and no damning documents to be found, the federal government totally failed to convict Al Capone of anything!
      [It finally took a bookkeeper from the IRS to put Al Capone in jail, and it was not for murder, bootlegging, prostitution, gambling, extortion, or any other real crime - it was for income tax evasion! They couldn't even prove perjury on Capone!]

      Al Capone directly profited from criminal activity for 11 years - from 1920 to 1931 when he finally went to jail.
      Bill Clinton has directly profited from criminal activity for at least 22 years - at least from 1976 when he became Attorney General of Arkansas to today. And as in the case of Capone, every American who has enough brain cells to successfully add 2 and 2 knows of his guilt: from before he became Attorney General of Arkansas, too many stories linking Bill Clinton by name to criminal activities ranging from bribery and payoffs to dope smuggling and murder have circulated in Arkansas for too many years for any reasonable person to peremptorially dismiss them all.
      The "body count" of people who have died of something other than old age and whose paths have in some way or other crossed Bill Clinton's path actually exceeds the body count of people who in some way or other ran afoul of Al Capone and subsequently died of something other than old age. The infamous St. Valentine's Day murders - the bloodiest of Capone's murders - had only 7 victims. There were 41 deaths - nearly six times as many deaths as Capone ever killed at one time - associated with the plane crash that allegedly killed Ron Brown, a hand-picked but dissatisfied Clinton Secretary of Commerce and co-conspirator.
      The (conservative) Clinton body count stands at 116 (and holding)! Some say it is considerably larger than that if/when one takes into account the premature deaths of those who were peripherally caught up in fatal "accidents" (as in the Ron Brown death). And again as in the case of Capone, the dead include former partners, knowledgeable insiders, "legmen" and victims, reporters, and people who simply had the misfortune to be in the wrong place at the wrong time.

      The "Whitewater" investigation was not "after" Clinton. It was nothing more or less than a carryover/clean up from the virtually total failure of the Savings and Loan industry in 1989, when then President George Bush (who had one son directly involved in the scandal through operation of/ownership in (?) a looted S in Colorado) announced the closing of 350 Savings and Loan companies across the country and the sticking of the U.S. taxpayers to the (initial) tune of $50 billion to partially "pay off" the creditors rather than going after the assets of the crooks who stole the money. Because of lax - if not criminally-complicit - supervision, hundreds of big-time scam artists set up (or took over) small S across the country, ran up their "deposits" bases, and looted the money for private use.
      For those of you who may have forgotten, the "biggest" exposé concerned Charles H. Keating, Jr., head of Lincoln Savings and Loan in Arizona, who gained national headlines (and obvious paid protection) by having 5 U.S. Senators on his payroll: John McCain and Dennis DeConcini, both of Arizona, Alan Cranston of California, Donald Riegle of Michigan, and "America's hero" John Glenn of Ohio. When the investigation had Keating ready for the federal penitentiary, all 5 "servants of the people" stepped forward, publicly swearing to Keating's "honesty" and character.
      The fact that Keating had given them a (known) total of $1.4 million had nothing to do with their testimony in his behalf, they claimed. Sure.

      Again, "Whitewater" - the "failure" (through deliberate fraud) of the Madison Guaranty Savings and Loan Association in Arkanses - investigation was not "after" Bill or Hillary Clinton. It was simply the "cleaning up" of one of those 350 S fraud cases that had started in 1989! [Even the Justice Department with its unlimited funding and huge staff can not "close up" 350 cases (on top of everything else - such as prosecuting Randy Weaver, Kevin Harris, the surviving Branch Davidians, and IRS victims) in just 3 or 4 years!]
      However, once the investigators started going over Madison's books, canceled checks and other documentation, the names of (now President) Bill Clinton and wife Hillary popped up regularly. Too regularly, considering the negligible amount of deposits credited to them.
      Then, and only then did the Clintons' become part of the criminal investigation known as "Whitewater." Note: This was not an investigation of the failed petty burglary of a personal telephone book - as the Watergate investigation was - but of a successful and massive, multi-million dollar financial fraud that ended up costing We, the Taxpayers, far more than the Starr investigation has!
      When duly subpoenaed (as any investigator would have to do), the Clinton's, true to what would eventually prove to be book, chapter and verse for them in all subsequent investigations, lied under oath by denying any and all connection with/profit from the fraud, and they obstructed justice by either destroying or hiding subpoenaed documents, buying off potential witnesses, and threatening potential witnesses. (Remember the telephone conversations between imprisoned Web Hubbell and his wife Susie where she spoke directly of her personal fear lest she do/say the wrong thing?)

      How can anyone be so certain that the Clintons lied and obstructed justice in all the investigations when they failed to turn over subpoenaed documents, claiming either that there simply were no documents or that they had been "lost"? Easy. Remember this:
      Bill Clinton admitted, long before he even finished college [ref: the letter to Col. Holmes and many other sources], that his one driving goal in life, from boyhood on, has been to be President of the United States. Ego-driven people who become President never "lose" or destroy so much as a single scrap of paper from their term of office - their egos will not let them! Just as John Kennedy did, they save everything - even the scraps - for use in their future Presidential Libraries so that all of posterity can know every detail about them.
      It was this same egomania that sank Richard Nixon. It was his pathological obsession with maximizing his "legacy" that kept him from trashing those embarrassing and incriminating tapes. Clinton suffers from the same weakness.
      They all do it, and anyone who has spent as little as six months around such a person knows this fact So destroy subpoenaed evidence or deny possession of it, it is all the same problem: you have obstructed justice at the minimum, and you have perhaps committed perjury as well!
      All that is left is to prove it.

      Exactly like Al Capone 70 years earlier, because of the inability of the prosecutors to legally prove their guilt, the Clintons escaped their just imprisonment. Even professionally deaf, dumb and blind Janet Reno could not deny that truth to herself - she knew the Clintons are major felons!
      So when the illegal possession and use of those thousand or so FBI files by non-cleared Clinton appointees could no longer be swept under the rug, Janet Reno and those 3 federal judges added that investigation to the Starr slate because of the unavoidable (and sole) Clinton footprints all over those files!
      By this time it was abundantly clear to Reno and the 3 judges that both Clintons were not "one-time offenders."

      Then the "Travelgate" matter proved to have been nothing more than the unjustifiable firing of non-political federal employees solely to be able to turn that operation over to Clinton's longtime Arkansas "good buddy" and acting coach (obviously to cut his friend - a successful and well-to-do Hollywood producer - in on "the spoils" of holding political office), which was another statutory crime! And when the "Arkansas Mafia" then tried (unsuccessfuly, thank goodness) to put the fired people in jail simply to draw public attention away from the true crime, once again puppet Reno and the three judges added that to Starr's investigation.
      And once again (book, chapter and verse) the Clintons escaped conviction through personally lying under oath, obstructing justice, buying off witnesses, and threatening others.

      So when it came about that in a stupid little civil lawsuit Bill Clinton provably committed perjury and probably provably committed subornation of perjury and obstruction of justice as well, it was by now a simple, "knee-jerk" reflex action to add that to the growing "Whitewater" (Madison Guaranty Savings and Loan) investigation.
      The stupid little act of lying under oath in a non-criminal civil lawsuit could finally bring the Clintons to criminal justice! And how - if they are so clever as to be able to successfully cover their tracks in a long string of major criminal acts - could they get trapped by this stupid little civil suit?

      Simply because it was a stupid, little civil suit. Clinton's hubris - his monumental egomania - is so great that he thought 1. no one would have the guts to challenge him - the President of the United States - in court (hell, no one had challenged him when he was only the Attorney General and then Governor of Arkansas!); and 2. even if someone should be so "stupid" as to take him to court, no one would take their word over his. Since there was absolutely no foreseeable "consequence" to his sexual predations, he saw no need to cover his tracks as he went along, as he had been successfully doing for more than 20 years in actual criminal acts!

      As frequently happens with power-mad megalomaniacs, he had miscalculated. Just exactly as Al Capone "miscalculated" with his income taxes 70 years earlier! (Or maybe the law of averages just finally caught up with him!)

      Being able to prove that Bill Clinton has lied under oath once (and especially in a silly little civil lawsuit) then makes a claim of perjury in his felony investigations legally easy to prove, especially when his very freedom (and perhaps life) is at stake! You have already established the pattern of behavior of lying under oath! And when a person will freely lie under oath in a silly little civil suit where the worst that can happen to you is a financial judgment, obviously you will lie your head off when everything you have - including your freedom and possibly even your life - is at stake!

      And that, kiddies, is why the Big Bad Starr is "persecuting" Little Red (as in hard-core communist) Riding Hood (how exquisitely appropriate a term) Bill Clinton.

      It is not about sex.



      Here are a few rebuttals you can use in response to some standard "defenses" of Bill Clinton.

      Excuse: Bill Clinton "suffers" from a "sex addiction" and, since he is unable to resist it, he cannot be "blamed" or held accountable.
      Rebuttal: In the first place, all "addictions" are nothing but an excuse for the conscious refusal to exercise self-control, self-denial.
      FACT: There are people who have broken a heavy addiction to heroin and/or cocaine simply by exerting self control. It is called "going cold turkey" and it includes enduring wracking, temporarily immobilizing withdrawal symptoms, but it can be done because it has been done. I repeat - without fear of compelling contradiction: all "addictions" are nothing more or less than the refusal to exercise self-control and self-denial!
      Secondly, even if such a thing as an "irresistible sex addiction" did exist, Bill Clinton does not "suffer from it." His behavior proves that.
      Just as observing another person using, say, cocaine does not satisfy a "cocaine addiction" and just as observing another person eating chocolate does not satisfy a "chocolate addiction," observing a woman masturbate herself does not satisfy a putative "sex addiction." And yet, it has been admitted by both Monica Lewinsky and Bill Clinton that Bill Clinton's participation frequently did not result in a climax for him. Ergo, he does not have a "sex addiction." So there has to be something else driving him.
      Thirdly (and speaking as a man who has insisted his entire adult life that nothing in the world is as "great" - as satisfying - as mutual sexual satisfaction), a simple sexual attraction (in the case of a man) requires a full, coital ejaculation. Nothing less truly "satisfies." And yet, by all known accounts (from both, Lewinsky and Clinton), he never got that from/with Monica! Ergo, it wasn't even a simple, natural sexual attraction that motivated Clinton.
      The world knows that he is not a selfless, "giving" person but a selfish, taking person. So he would not, could not have been "satisfied" by his relationship with Monica if he was sexually attracted to her.
      Furthermore, it is an unarguable fact that, through no fault of theirs, at least two of Clinton's "targets" were not physically attractive - sexually attractive - women. So why would Clinton pursue unattractive women? We know for a fact that he did have ongoing sexual affairs with quite attractive women (including one former Miss America), so it could not have been sexual desperation that drives him!
      So if it wasn't a sexual addiction, sexual attraction, or even sexual desperation that drew him to Monica, what else could it be?

      There is one fairly common mental state/condition that does nicely and accurately fit the known facts of Clinton's behavior with/toward women, and that state is a deeply-buried hatred of women. A need to "take revenge" on women by "degrading" them in the subject's mind. Consider these "symptoms" of such a condition.
      1. Sexual gratification for the subject is not a necessary condition of satisfying the hatred. And, as pointed out above, Clinton regularly did not get sexual satisfaction - a climax - from his sessions with Monica. Psychological satisfaction - maybe (probably), but sexual satisfaction - no!
      2. The subconscious need to coax, coerce, or and/compel the target sex into performing what the subject considers "degrading" activities is eternally present in a person who subconsciously hates the opposite sex. And having a "target" woman regularly perform (or accept) sexual actions that do not give her any personal contact, sexual satisfaction, and/or sexual climax - to get her to be nothing more than a "performing monkey" - is degrading in anybody's value system. And by all accounts - both, Monica's and Clinton's reports - Monica must have hardly ever experienced a climax herself . And in the few times she may have had a climax, it certainly was not because of anything Bill Clinton did!
      3. And there is one more little "clue" that, in context of the woman-hater hypothesis, adds one more "proof" of the hypothesis. And it is the matter of oral sex.
      While oral sex is apparently performed with some regularity nowadays by a huge number of both, men and women, there nevertheless are a considerable number of both men and women today who believe that it is "nasty," demeaning, a "bad" activity that only "bad" people indulge in.

      Let us now look at Bill Clinton in the purported context of a man who has either a normal sex drive or a sex addiction. In either case, he wants/needs physical sexual satisfaction. Okay, so he says he has a compulsion (on quasi-moral, quasi-legal grounds) against indulging in actual "sexual intercourse" with any woman other than his wife. (A statement that everybody knows is a flat lie: think of Gennifer Flowers and the Miss America for starters.) And so, he says, that is why he abstained from having genitally-penetrative "sexual intercourse" with Lewinsky. That is why he had her perform oral sex on him.
      But why didn't Clinton perform oral sex on Monica? After all, by his own proclaimed "technical" definition of "sex," he could have and he would still be legally "clear." (And I can tell you from personal experience that it can feel good to give a woman the pleasure of receiving oral sex.)
      I can further tell you, from personal conversations with them or their spouses, that there are men and women who will pleasurably accept oral sex but who refuse to give oral sex because in their mind it is "nasty" or "bad." And we know - again, from both Clinton and Monica - that Clinton was happy to receive oral sex but did not give it in return.
      Which behavior is perfectly consistent with the behavior of a person who subconsciously hates the opposite sex: have them perform "nasty" - "degrading" - sex upon you, but give them nothing in return!
      Bill Clinton does not have a "sex addiction" - he simply hates women for some deep reason, and is taking revenge on them generically by sexually degrading them.

      Excuse: Starr has spent four years investigating Clinton. Will he never give up?
      Rebuttal: The Democratic special prosecutor spent seven years investigating Iran-Contra, and Iran-Contra contained no allegations or findings of personal enrichment or the commission of common (statutory) felony crime.

      Excuse: Starr has spent 40 million dollars on his investigation. That's an outrageous and unacceptable amount of taxpayers' money!
      Rebuttal: The Madison (Whitewater) felony fraud cost the same taxpayers more than 60 million dollars! And the Iran-Contra investigation: while its cost is not known, considering how much longer it was carried on, it had to have cost far more than Starr's 40 million dollars.
      And Clinton himself spent more than twice as much taxpayers' money on his sneak missile attack on the Afghanistan rocks and the Sudanese aspirin factory: 75 cruise missiles at a purchase price of 1 million dollars each, plus the delivery costs, exceeds 80 million dollars!

      Excuse: Impeaching Bill Clinton will destroy the Presidency, will destroy this nation!
      RebuttalHogwash! The impeachment and near conviction of Andrew Johnson did not destroy either the Presidency or this nation. The vote of the House Judicial Committee to hold impeachment hearings on Richard Nixon did not destroy either the Presidency or this nation. And the resignation of Richard Nixon (rather than facing an impeachment) did not destroy either the Presidency or this nation.
      The fact is that neither the President, the Congress, or any politician, bureaucrat, or group of same causes this nation to function or "holds it together." This nation "runs" - operates - because there are people working in the factories and on the farms, people performing the services America wants, private citizens creating businesses, and people buying those products and services that pay for all that labor and investment. And no politician, bureaucrat, or group of same works in the factories and on the farms (creating the goods that make the economy "go"), performs the services society uses, establishes the businesses that enable the goods and services to be used, or creates the market to which those goods and services go.
      In further fact, this nation has had several presidents unexpectedly die in office, and this nation is still here and still functioning! (Well, to a degree.) The only people who insist that impeaching a sitting president would destroy this nation are the politicians themselves who would like us to think that we cannot afford to impeach them, and that portion of the citizenry that does not and cannot think for themselves - they do feel panic at the thought of there being no one to tell them what to do!
      Every nation runs (or doesn't run) on the backs of its people. never on the hot air of the politicians!

Return to Reality Check Index

Return to Committee for a Sane Society Table of Contents

For copyright and reprint information, click here

Phil Gramm's Skeleton Closet

Picture of GrammMr. Tall Skeleton

Click on the allegation of your choice:


- Savings & Loan Scandal
- Helped get a convicted drug dealer out of jail
- Laundered Illegal Campaign Contributions to Bob Packwood
- Funded a Sleazy Movie -- - Draft Dodger
- Petty Abuses of Power: illegal hunting, getting staffer out of the army
- Character -- - Quotes -- - Sources



"The most dangerous place in Washington is between Phil Gramm and a camera" -- something reporters say

"Anybody with $2.1 billion has to be taken seriously." -- Gramm, about Ross Perot

"If you're willing to pay the price, you can beat anybody at anything." - Phil Gramm

"He's always willing to rise above principle. He's got every quality of a dog except loyalty." -- Dave McNeely, political columnist for the Austin, Texas American-Statesman

"You can love him or hate him, but when you're dealing with him, there are 2 things you've got to remember: #1, he's smarter than you are. #2, he's meaner than a junkyard dog." -- Marvin Leath, former Gramm colleague

"I'm carrying so much pork [home to Texas] I'm beginning to get trichinosis." -- budget hawk Phil Gramm

"Voters vote for people they like. Now Phil, I know his mother likes him. I know Wendy likes him. I think his dog likes him. And I like him. I've named four." -- Buddy Roemer


Sleazy Film Financier

Gramm's brother-in-law, George Caton, says he watched a film called "Truck Stop Women" with Gramm back in 1974, which got our champion of family values interested in investing in this kind of movie. Gramm admits that $7,500 of his money somehow wound up financing a never-completed, R-rated movie called "Beauty Queens" but he denies that he had any interest in funding pornography.

That may be true. They press hyped this up as supporting a "porn" film, which is a ridiculous overstatement. The fact is, Gramm got taken; "Beauty Queens" was never made, and the money went to finance a raucous and stupid anti-Nixon movie (which never made a dime.) (Gramm is said to have watched and like the result.)

But it is clear that Gramm had no compunctions about making money off an off-color film. This makes his current sucking up to the Christian right all the more offensive. And his evasive responses when asked about this scandal are disturbingly typical of Gramm's responses to other charges and allegations.

Savings and Loan Scandal

Texas S&L; owner Jerry D. Stiles, who has been convicted of bank fraud in the S&L; scandals, advanced $117,000 interest free for a construction crew that came from Texas to Maryland to build Gramm a vacation home. There were no written estimates or contracts. Months later, Gramm paid back just $60,000 and Stiles paid the rest. About the same time, Gramm ushered through a bill that allowed sick Texas S&L;'s (such as the ones Stiles owned) to stay open. He later urged regulators to give Stiles waivers -- even after they found irregularities that led to Stiles' conviction -- and advised Stiles on new banking regulations. The Senate investigated Gramm but ruled that the $57,000 Stiles paid was a "cost overrun", not a payment.

Getting A Drug Dealer Back On the Streets

In 1979, letters signed by Phil Gramm on his congressional stationery were sent to the parole board, asking for an early release for a man, Bill Doyle, who had been repeatedly convicted on drug dealing and weapons charges. Doyle was released soon after Gramm's letter, and has been sent back to prison 3 times since on new drug charges or for failing drug tests.

Gramm first claimed never to have heard of the man. When Mother Jones magazine produced letters with Gramm's signature, his office released a statement by a secretary claiming that she sent the letter out without his knowledge, forging his signature. We find this hard to believe.

Draft Dodger

Like most of the candidates for President this year, Phil Gramm was of age to fight in Vietnam -- and avoided it. Gramm used five deferments for college and marriage to stay in America while the Dickey Flatts of the world were fighting, and getting killed, overseas.

Rival Bob Dornan, a fighter pilot in the 1950s who went to Vietnam as a press photographer, calls Gramm "a Vietnam-era draft evader undeserving of the role of president." Would he call Gramm a draft dodger? "Yeah. Anybody born prior to 1952 who was physically fit had a choice. You either did something or sent someone else there in your place."

Laundering Illegal Campaign Contributions for Bob Packwood:

Gramm was head of the Republican's Senate campaign fundraising effort in 1992. Bob Packwood's diary describes a meeting on March 6, 1992 where Gramm promised to funnel $100,000 in party "soft" money to Packwood's campaign. The limit for party contributions to a candidate, $17,500, had already been given at that point. (Packwood narrowly won reelection while vastly outspending his opponent.)

"What was said in that room would be enough to convict us all of something," Packwood wrote in his diary. Packwood now says that the diary entry was "totally wrong." Gramm says the diary "reflects an obvious misunderstanding of the election law..." But the simpler explanation is that Packwood's diary, which he never expected to see the light of day, and fought like a demon to keep private, is telling the truth. In his fight, Packwood warned that making the diary public would ruin senators other than himself -- and no one has reported any other diary allegations as serious as theis one against Gramm.

Gramm's extraordinary success in fundraising was his stepping stone to this presidential campaign -- a lot of Republicans owe him favors. (Just like Jerry Brown did earlier for Democrats). But Gramm owes a lot of favors to big money donors, and his career has been marked by his willingness, even eagerness, to pay back his donors with political rewards.

Abuses of Power

Gramm has a disturbing pattern of pulling strings to get his way. Few of the examples are crucial, but they add up to a continuing character defect. For example

- Pulling strings for illegal hunting near his Maryland resort home.

7 game wardens say that Gramm, a hunting buddy and a major contributor used his clout so all 3 could continue illegal duck hunting over ponds baited with grain. Gramm's beach home borders the Blackwater National Wildlife Refuge.

Tax lobbyist J.D. Williams, a friend and contributor of Gramm's, had been feuding with game wardens since being arrested for hunting over baited fields two years before, and now he had been heard threatening wildlife officials that with Gramm's clout, any official who gave him trouble is "going to be counting seals in Alaska."

Gramm called a meeting with Williams and Frank Dunkle, director of the U.S. Fish and Wildlife Service, for a chat about wildlife law enforcement on the Eastern Shore. Dunkle warned Gramm that his property was under surveillance for baited hunting, and issued a new policy - applying only to the Blackwater refuge - forbidding wardens from enforcing waterfowl laws on neighboring properties. 7 months later, the director of the Blackwater Refulge was transferred unwillingly, not to Alaska but to Georgia's Okefenokee Swamp, and another wildlife official who had refused to transfer him was also reassigned.


We haven't found any yet. We'll let you know. Actually, he showed some guts and open mindedness by marrying a woman of Korean descent. It's a sad fact that this may cost him more votes than his sleaze.


Cloud, David S. "Gramm deal questioned." Congressional Quarterly Weekly Report v50, n48 (Dec 5, 1992):3750.

Time Daily Online, May 18, 1995 p1, citing the New Republic that week. (re: Porn film)

"Gramm Denies Diverting Funds to Packwood Camp", NY Times news service, San Francisco Chronicle, Spetember 9, 1995 pA2

"Phil's Felon", Will Saletan, Mother Jones, January 1995

"Justice Dept. to Review Packwood Case", San Francisco Chronicle, September 15, 1995

"Hunting Rules Eased for VIPs", Susan Baer (Baltimore Sun), San Francisco Examiner, April 2, 1995 pA-8

"Gramm Linked to Illegal Hunting", Jim Drinkard, Associated Press, May 1, 1995

"Gramm Says Aide Used His Name in Early Parole of Drug Dealer", Thomas Edsall (Washington Post), San Francisco Chronicle, pA12

"Gramm Admits Plucking Aide From Air Force", San Francisco Chronicle, June 1995, pA18

"Dornan: Is He Just Running To Deny Gramm The Nomination?",



Paid for by Real People For Real Change and not authorized by any candidate or candidate's committee.

The Alan Greenspan Connection

Copyright 1999 Real People For Real Change

THIS ESSAY FIRST APPEARED IN THE TEXAS OBSERVER OF FEBRUARY 23, 1996 AND IS COPYRIGHT 1996 BY THE TEXAS DEMOCRACY FOUNDATION. PERMISSION GRANTED TO COPY AND CIRCULATE FOR ANY NON-COMMERCIAL PURPOSE, PROVIDED THIS NOTICE AND THE ESSAY REMAIN INTACT. The Free Ride of Mr. Greenspan James K. Galbraith President Clinton is coming up on the most important appointment of his second Presidential term. Sometime soon, the term of the Chairman of the Board of Governors of the Federal Reserve System will expire. And the President must choose, whether to reappoint Alan Greenspan for four more years, or else to name a replacement. Most observers assume that Greenspan will get it, and a strange public quiet has settled over this issue. Yet, Greenspan's track record is poor. He did act back in 1987 to prevent that October's stock market crash from turning into a Depression. But he did not cut interest rates in time to prevent the recession of 1990, nor to foster recovery in 1991. And in 1994 he virtually wrecked Clinton's first term, by raising interest rates immediately after the 1993 deficit reductions, which were supposed to bring rates down, passed into law. The destructiveness of that 1994 action is now clear. The economy is slowing on all fronts. And the Federal Reserve is again cutting interest rates, bit by bit. Whatever happened to the threat of inflation? It never existed. The economy last year was actually much more fragile than Greenspan thought. And now, because interest rates were doubled then in a false cause, stagnation and rising unemployment or even a recession this year cannot be ruled out. Can't anyone make a mistake? Yes, but this is not the first time. A bias toward high interest rates and high unemployment is part of Mr. Greenspan's personal, political, and ideological fabric. It is not accidental. It is systematic. Personally, Alan Greenspan is a very, very conservative man, not a run-of-the-mill conservative but a philosophical extremist. Long sympathetic to the gold lobby, he once gave one thousand dollars, I'm reliably told -- a thousand dollars! -- to the 1984 reeelection campaign of the Senate's most powerful reactionary (and closet gold bug), Senator Jesse Helms. Indeed, Greenspan's entire professional life has been devoted to the service of the rich. His early ideology, as a follower of Ayn Rand, celebrated such service. And his later career, private and public, confirms that the rich and powerful are the people he respects, admires, and works for. In the mid-1980s, these leanings took Greenspan into the orbit of Charles Keating, the highest flyer in the Savings and Loan industry at that time. Keating's Lincoln Savings and Loan Association was in trouble, as regulators wised up to its real estate scams. Keating needed lots of help. Greenspan, then a private consultant, obliged. On one day for which we have records, December 17, 1984, Mr. Greenspan traveled to Washington to lobby on behalf of Mr. Keating. Greenspan's personal fee for that one day was $12,000. What kind of work did Keating get? On February 13, 1985, Greenspan wrote a long letter to the principal supervisory agent of the Federal Home Loan Bank in San Francisco. In it, he committed his vast prestige to the proposition that Lincoln and Keating presented "no foreseeable risk to the Federal Savings and Loan Insurance Corporation." The letter is a classic of Randian farrago: "1. Lincoln's new management, and that of its parent, American Continental Corporation, is seasoned and expert... "2. the new management has a long and continuous track record of outstanding success in making sound and profitable direct investments. "3. the new management succeeded in a relatively short period of time in reviving an association that [was near] the point of insolvency. "4. the new management effectively restored the association to a vibrant and healthy state, with a strong net worth position, largely through the expert selection of sound and profitable direct investments..." And so on. In fact, Lincoln Savings and Loan Association was at the heart of a massive fraud; those "sound and profitable direct investments" were mostly worthless. The collapse, when it came, by itself cost American taxpayers over three billion dollars, more than any other single S&L.; It resulted in more than six felony convictions, including that of Charles Keating. Greenspan's reconfirmation would come before the Senate Banking Committee, whose chairman, Senator Alfonse D'Amato, is the chief inquisitor into that fringe of the S&L; scandal known as Whitewater. Lincoln's failure was roughly a hundred times more costly. And Greenspan is being considered -- amazingly enough by a Democratic President -- for reappointment to the single greatest position of financial trust in the entire world. It would be nice to think that, if the occasion arises, the Senate Banking Committee will investigate carefully what Mr. Greenspan really knew of Lincoln Savings and Loan and about Mr. Charles Keating back in February of 1985. The Senators should ask what Greenspan did to assure himself of the accuracy of his knowledge, before drafting his influential letter and before collecting another Keating fee. Weak ethics or poor judgment? Hard to say. Charitably, I'd guess that Mr. Greenspan was simply seduced by Mr. Keating. But however that may be, so long as those old S&L; coals continue to smolder, Greenspan's Keating connection is another good reason why Clinton should pick somebody else to chair the Federal Reserve. Indeed, given what we know so far, the republic would be safer if the President named his wife to the job. ******* James K. Galbraith teaches at the Lyndon B. Johnson School of Public Affairs, the University of Texas at Austin. Comments welcome at <> .

Online Journal

The Starr Report, Aug. 15, 1999:
Bush Family Values

By Linda L. Starr


After the Los Angeles shooting fiasco George Dubya Bush was most curiously silent. Many of us wondered publicly why he would fail to seize the opportunity to comment on a horrendous racial hatred crime.

Then someone pointed out the Salon article titled Guns and Money of August 11, 1999 in which we discover that "The owner of the firm that made the assault rifle used in the LA shooting was, until recently, a key George W. Bush fund-raiser. "  

Awww, now we understand, no hypocrisy here. If George Dubya will accept funds from weapons that kill people, (but he shares no responsibility for the deaths of murder victims from guns,) then his newest nickname of Governor Death for turning Texas into the execution capitol of the world aptly applies and for more reasons than never once commuting or staying any death sentence.

And let us not forget about FuneralGate, where there seem to be some curious coincidences in campaign contributions to George Dubya and preferential treatment in investigating Service Corporation International (SCI), one of the largest funeral home businesses, for allegedly employing unlicensed embalmers in its Dallas facilities.

Considering the family background of alleged money laundering schemes for Nazis, it's no small wonder there seem to be continuing ties of Bush family campaign contributors to alleged Nazi groups. It seems as long as the proper Bush results are produced, it matters not how the process evolved.  George Dubya told James Barnes of the National Journal, "I'm a decisive person who doesn't read treatises, I'm not interested in process. I want the results. If the process doesn't yield the right results, change the process." All very interesting and heartwarming to holocaust victims I'm sure, not to mention the rest of us.

Then we come to another article by Tucker Carlson, who interviewed George Dubya, in the maiden issue of Talk magazine. And I quote the article "Carlson reports asking Bush whether he met with any persons who came to Texas to protest the execution of the murderer Karla Faye Tucker. Bush said no, adding: 'I watched [Larry King's] interview with [Tucker], though. He asked her real difficult questions, like '"What would you say to Governor Bush?"'" Carlson asked, "What was her answer?" and writes: "'Please,' Bush whimpers, his lips pursed in mock desperation, 'don't kill me.'" And this is the person the GOP would crown KING if they had their way in this country!!!

I can't decide if I'm more disgusted by the attitude or gladdened by the open way in which George Dubya is revealing his true sentiments. Part of me wants to run to throw up somewhere and the other part of me wants to wave his comments like a screaming fire alarm to the world of what the GOP would heap on this country again by its chosen candidate.

Oh yes, it is so enlightening to read about the Bush family values. Do any of you remember this back during the Silverado Savings and Loan Scandal (Neil Bush) while Bush Daddy was president?  "Jeb Bush, now Florida governor: U.S. repaid loan to finance building owned by Jeb Bush," Jeff Gerth wrote back in Oct. 1990 in the New York Times. " Bush and his partner negotiated a settlement with regulators ... the settlement removed from their backs a $4.565 million second mortgage..."

So now I must ask you: Who realy paid for Columba's luxuries on her Paris shopping spree? Jeb seems to think he did and it's not anyone else's business.

"If it had been Hillary instead of Columba Bush... " article In Online Journal June 23, 1999 by Bev Conover... "'She knew what she did was wrong and made a mistake,' Bush told reporters during a bill signing ceremony in Tallahassee.  'It is a lot of money. But look, that's between her and me,' Jeb told reporters."

Considering the ways our privacy rights are being invaded, and our First Amendment rights are being trampled by conservatives who protest that "there's too much freedon on the internet" to quote George Dubya, I might agree these issues should be off limits. My biggest qualms are in the overall attitudes and value system of the Bush family in general in regard to death, campaign contributions, money making schemes, the doubles standards in morality issues (one standard for them, another for the rest of the world), their acceptance of getting rich off taxpayers, the idea that they are too important to be subject to subpeonaes or rules of law that we must all follow, and the overall disrespect for individual human beings as displayed in Dubya's mocking of Karla Faye Tucker during her appearance on Larry King's show. 

So now I just feel compelled to ask the promoters of George Dubya, are these your ideas of compassionate conservatism and family values?   If they say, "Yes," I say run, do not walk to the nearest exit--do not pass go, do not collect $200, do not go to jail, do not roll the dice, do not expect things to improve in this country unless you: SAY NO TO GEORGE DUBYA FOR PRESIDENT!"

At any rate, we certainly see now all the ways in which George Dubya touches death, profits from death, and impacts death to earn the nickname Governor Death.

Online Journal  Home   Bush  Gore  Nader  Senate   Special Reports  Media
Church & State  Racism  CNP  KPFA/Pacifica  Kangas

Copyright © 1998-2000 Online Journal. All rights reserved.