From Volume 5, Issue Number 28 of EIR Online, Published July 11, 2006

United States News Digest

Lay's Death and the Lessons of Enron

Former Enron CEO Kenneth Lay died of a "massive coronary" six weeks after his conviction for his role in the Enron fraud case. Lay, once a friend and big financial contributor to both Bush 41 and Bush 43 who had been hailed by Wall Street and America's financial press as a bold businessman, the CEO of "America's most innovative company," passed away near Aspen, Colorado, while awaiting sentencing. His old friend George W. Bush, who was a leading beneficiary of Lay's largesse and used to refer to him as "Kenny Boy," could say of his passing, through spokesman Tony Snow, only that he was "an acquaintance" of the President, and that "[M]any of the President's acquaintances have passed during his time in office."

Lay's death will be the cause of much pious posturing, as in the lead editorial of the July 6 Houston Chronicle, which describes his "untimely" death as "a sad end to a tragic story." Should he be remembered for his charity work, his "civic leadership" in Houston, or for his drive "to gain personal wealth," to which the Chronicle and other press attribute the fall of Enron? The editors of his hometown paper seem unsure as to whether they are more upset at the damage done to "Houston's image" by the Enron saga, or at the fact that his death before being sentenced "has cheated the court of final judgment and society of [payment of] its debt, both financial and penal."

Once again, those who claim to chronicle the events of current history are doing a disservice to their readers with this kind of sincere, romantic, typical Baby Boomer cover-up of the actual events which led to the demise of Enron and, ultimately, of Ken Lay. Enron, as EIR has covered it uniquely, was used to dramatically advance the cause of deregulation of the banking and financial system of the United States. Enron had ceased long ago to be an "energy" company, but was transformed by Lay and Jeffrey Skilling—with ample aid from the likes of the Lazard/Rothschild, Chase, and Citibank financial swindlers—into a "hedge fund with pipelines."

Perhaps the defining moment for Enron was the California energy crisis in 2001. While Enron's traders were bragging about "f—-ing Grandma Millie," by illegally withholding electricity to jack up the rates, Lay was "advising" Vice President Cheney on the virtues of deregulated electricity and energy markets. The subsequent economic collapse of the state of California led to the recall against Gov. Gray Davis and the rise to power of Arnold Schwarzenegger—who, just like the Bush-Cheney regime, was a puppet of Synarchist George Shultz. Of course, Shultz played a leading role, going back to President Nixon and the 1971 breaking up of the Bretton Woods system, which allowed him to impose the deadly policy of deregulation on the U.S. economy.

Were the media to treat Ken Lay honorably, his death could be used as a late warning that the policies he championed in his life, must be reversed, if the U.S. and world economies are to avoid the fate of his corrupt corporation. The business model of Enron could be presented to future economists, not as "greed-gone-wild," but as the inevitable result of allowing Synarchist financiers a free hand. To those Boomer romantics who would whine that the tribulations of the fall of Enron and the subsequent trial broke Ken Lay's heart, we can assert, ironically, that Lay, a self-proclaimed apostle of free markets, might still be alive today, if the post-Depression regulatory policies of Franklin Roosevelt had remained in place.

GOP Begins Road Show on Immigration

July 5 was the first day of implementation of Karl Rove's immigration-election tactic, by which Congressional committee chairmen are holding "field hearings on immigration" around the country during this week's recess. The purpose of the hearings is to allow House Republicans publicly to kick around the Senate's "guest worker" bill, and try to join the immigration debate to the "international war on terror." Congressman Ed Royce (R-Calif) typically held a hearing in San Diego on "Border Vulnerabilities and International Terror." Senator Arlen Specter (R-Pa), chairman of the Judiciary Committee, held a hearing in Philadelphia, focussing on the economic impacts of immigration. And Democrats—who had said they would boycott these shows and campaign for a higher minimum wage during the week—changed their minds and decided to do battle over immigration policy at the "field hearings."

But neither party will bring up the issue of free trade and NAFTA's destruction of the Mexican economy—the clear cause of the mass immigration from Mexico over the past decade.

Senator Edward Kennedy (D-Mass) and Rep. Luis Gutierrez (D-Ill) held a press conference call following Specter's hearing. EIR asked the same question—on NAFTA causing mass illegal immigration, and the need to reverse free trade and develop the border—to both Gutierrez and Kennedy. Each of them, in succession, disappeared from the call, upon being asked that question. After Kennedy's disappearance, the call ended, with reporters both laughing and grumbling at what had happened.

Neo-Cons Are Democrats, Too scored the Democratic Party's neo-con problem of fascism, in a July 5 column by Justin Raimondo identifying Sen. Joe Lieberman as following in the fascist footsteps of "Truman Democrats" and "Scoop Jackson Democrats." Neo-conservatives "are usually thought of as being exclusively Republicans, but this ignores their history as a political and ideological tendency and the background of the Scoop Jackson Democrats, notably Richard Perle, a Jackson aide; Elliott Abrams, former chief of staff to Sen. Daniel P. Moynihan; and such neo-con notables as Ben Wattenberg, Joshua Muravchik, and Marshall 'The Moose' Wittmann, the present-day sage-in-residence at the Democratic Leadership Council (DLC), the main organizational caucus of these latter-day Jacksonians."

Lieberman To Run as Independent if He Loses Primary

Senator Joe Lieberman (D-Conn) seems bent on proving the veracity of a campaign commercial by his Democratic primary opponent Ned LaMont. Lieberman told CNN on July 3 that if he loses the August primary to Lamont, who is campaigning as the anti-war candidate, he will attempt to run as an independent in the November elections.

The Lamont campaign has been running a TV commercial with Lieberman's voice endorsing the war on Iraq and other Cheney/Bush regime crimes. While Lieberman speaks, Bush is seen mouthing at the podium. Then a voice-over is heard: "If it talks like a Bush, and acts like a Bush, it can't be a Connecticut Democrat."

Democratic Senate leader Harry Reid and Sen. Chuck Schumer (D-NY), chairman of the Democratic Senatorial Campaign Committee, are backing Lieberman in the primary, but, through a spokesman, have refused to say what they will do after that.

Current polls indicate that Lieberman would win as an independent in a three-way race in November. But then, polls used to indicate that he would coast to an easy win in the primary.

Rahm Emanuel: 'I Do Not Work for Lazard Freres!'

Long-time Chicago Democratic Congressman Rahm Emanuel, head of the Democratic Congressional Campaign Committee (DCCC), which decides which Congressional candidates the Democratic Party will fund, was confronted by veteran LaRouche activist Gerald Pechenuk June 30. Pechenuk printed out Emanuel's top 10 contributors in preparation for an intervention at Rahm's scheduled handshaking event at a supermarket. The contributors include Lazard Freres at $10,800, Avenue Capital Group (buys bankrupt companies) at $16,000, and Madison Dearborn Partners (mergers & acquisitions) at $14,000.

Confronted with this, Rahm said, "I'm done with you," and ostentatiously refused even to look at the literature the LaRouche organizers gave him—the Rohatyn material and the Emergency Recovery Act.

But Emanuel blurted out, "I do not work for Lazard Freres," as Fox TV filmed the scene.

Senators React to Supreme Court Decision on Gitmo Trials

The July 3 Sunday talk shows were dominated by Senate fallout from the Supreme Court's slapdown of the Bush Administration's plan for military tribunals for suspected terrorist detainees at Guantanamo Bay prison:

* Appearing on NBC's "Meet the Press," Sen. Chuck Schumer (D-NY) said he had sent a letter July 2 to Attorney General Alberto Gonzalez asking for a review, in light of the Supreme Court ruling, of "all their other arrogations of power" (including warrantless wiretaps), where the "Administration just said, unilaterally, 'we can do whatever we want.' That's not how the United States works."

* Senator Dianne Feinstein (D-Calif) said the Court's ruling "was that the President exceeded his authority," adding, "I do think this applies to the terrorist surveillance program." "The President is somewhat bridled by the Constitution and the law ... and he must follow this in this war on terror," she said on ABC's "This Week" program.

* Senator Arlen Specter (R-Pa), chairman of the Senate Judiciary Committee, said he has scheduled a hearing July 11 for Congress to devise rules for military commissions. "We ought to work with the Administration to try to structure rules that will comport with the Supreme Court decision, but still protect national security interests," he said on CBS's "Face the Nation."

Meanwhile, appearing on "Fox News Sunday," Sen. Lindsey Graham (R-SC) railed against what he called a "breathtaking" decision by the Supreme Court affirming Geneva Convention protections for al-Qaeda members being held in prison. "The Geneva Convention cannot be used in the war on terrorists to give the terrorists an opportunity to basically come at us hard without any restrictions on how we interrogate and prosecute."

Likewise, Sen. Mitch McConnell (R-Ky), appearing on NBC's "Meet the Press," called the decision "very disturbing."

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