From Volume 7, Issue 25 of EIR Online, Published June 17, 2008

United States News Digest

Probe of Governor Triggers Warfare Among Illinois Dems

June 12 (EIRNS)—Warfare has broken out in the Illinois Democratic Party over a "talking points" memo drafted by the staff of House Speaker and state Democratic Party chairman Michael Madigan, which was leaked to Associated Press on June 10. The memo, for legislative candidates who want to call for the impeachment of Democratic Gov. Rod Blagojevich, doesn't call for impeachment, but rather investigation of possible wrongdoing by the governor, to determine if there are grounds for impeachment.

Although the excerpt of the memo published by AP focusses on local disagreements in governing, the Chicago Sun Times reported June 11, from its copy of the document, that the memo "refers to corruption under Blagojevich as a 'tumor' and notes that 'criminal activity in the Blagojevich administration is no longer theoretical; it is proven.'" The latter is a reference to the recently concluded Tony Rezko trial. Rezko was a major financial supporter of Blagojevich's campaign and a member of his "kitchen cabinet," and the trial was filled with testimony about campaign donations extorted from businesses as a condition for contracts from state administrative boards. Rezko was also a close friend and political ally of Democratic Presidential candidate Barack Obama.

Immediately after the guilty verdict against Rezko, Federal investigators made it clear it was "full speed ahead" on the larger investigation of the Blagojevich administration, dubbed "Operation Board Games."

High Court Rebuffs Bush-Cheney; Restores Habeas Corpus

June 12 (EIRNS)—For the third time since 2004, the U.S. Supreme Court has rebuked the Bush Administration for its "war on terror" detention policies, initiated and promoted by Vice President Dick Cheney.

Today, the High Court ruled, in a 5-4 decision, that prisoners at the U.S. facility in Guantanamo, Cuba have the right to challenge their detentions in the Federal court system, and that neither the Executive nor the Congress can take that right away from them. In so doing, the Court overturned the habeas-stripping provisions of the Military Commissions Act of 2006, the "torture bill" that was rammed through Congress under extraordinary pressure brought to bear on the Senate especially, by Cheney personally.

Rebutting the Cheney argument (based on the legal doctrines of Nazi jurist Carl Schmitt), that in times of emergency, laws and the Constitution itself can be overridden by the leader (known as the "Unitary Executive"), Justice Anthony Kennedy wrote for the Court's majority: "The laws and Constitution are designed to survive, and remain in force, in extraordinary times."

In affirming the Constitutional separation of powers, the Court stated: "To hold that the political branches may switch the Constitution on or off at will would lead to a regime in which they, not this court, say 'what the law is,'" Justice Kennedy wrote, referring to the famous 1803 ruling in Marbury v. Madison, in which the Supreme Court asserted its power to review acts of Congress to determine whether they comport with the Federal Constitution.

Bloomberg Pushes Infrastructure Scheme in U.S. Senate

June 12 (EIRNS)—New York City Mayor Michael Bloomberg appeared before the Senate Banking Committee, chaired by Sen. Chris Dodd (D-Conn.), to testify on the subject of "The Condition of our Nation's Infrastructure: Local Perspectives from Mayors." In his opening statement, Bloomberg boasted about his role in the Building America's Future coalition (on whose letterhead his printed statement was prepared), all the money his administration is spending on transit, water, and sewer infrastructure, and the still unmet needs of the region.

The subject of public-private partnerships was raised by Sen. Richard Shelby (R-Ala.), the ranking Republican on the committee, who wanted to know what "impediments" mayors faced in using PPPs. Atlanta Mayor Shirley Franklin and Bloomberg both replied that the biggest impediment is the lack of a revenue stream—i.e., the guaranteed looting rights that investors will insist on, before putting in a penny to urban infrastructure. Bloomberg complained that the New York State legislature rejected his "congestion pricing" scheme for the city, which he claimed would generate a revenue stream which could then be used to attract private investors. The measure would have imposed a stiff fee on drivers in Manhattan during peak hours.

Obama Team's 'Behaviorist Economics': Turn Humans into Monkeys

June 10 (EIRNS)—The economic team of Democratic candidate Barack Obama is part of a sub-cult at the University of Chicago known as "behaviorist economics." They see their theories as the middle ground between Keynesian (regulated) and Friedmanite (free-market) economics. Their idea is, that the problem with Milton Friedman's theory of "self-correcting markets" is that humans act irrationally, causing panic selling, runs on banks, freeze-ups of credit markets, and other undesirable effects. Government regulation must therefore use behaviorist reward-and-punishment techniques to restrain the humans, so that the markets can continue.

Obama advisor Austan Goolsbee's mentor Richard Thaler and colleague Cass Sunstein are leading lights of this school, a radical fringe of the "mainline" Friedmanites at the University of Chicago, where Obama taught law for ten years. Thaler and Sunstein have just authored a book, Nudge: Improving Decisions About Health, Wealth and Happiness; their solutions run to things like transparency in credit card (and presumably home loan) disclosures, and a public Greenhouse Gas Inventory, designed to "shame" offending industries to "clean up" their act.

There is an uglier side to this program, however, as revealed by Goolsbee in an article for Slate in 2006, "Where the Buses Run on Time: The Lure of Incentive Pay." This study of the Chilean economy, where "incentives" are given to bus drivers for punctuality and passenger totals, shows where this "behavior modification" is leading. Chile's program is a remnant of its fascist past, and has many similarities to the "Opportunities NYC" welfare incentive program implemented by Mayor Michael Bloomberg last year, with the help of Rockefeller Foundation president Judith Rodin. Here, the idea of "state regulation" is turned on its head, to protect the market economy and reduce the human population to "incentivised" roles.

House Democrats Want Special Counsel on Detainee Abuses

June 9 (EIRNS)—In a letter dated June 6, sixty Congressional Democrats, led by House Judiciary Committee chairman John Conyers (Mich.), sent a letter to Attorney General Michael Mukasey, requesting the appointment of a special counsel "to investigate whether the Bush Administration's policies regarding the interrogation of detainees have violated federal criminal laws. There is mounting evidence that the Bush Administration has sanctioned enhanced interrogation techniques against detainees under the control of the United States that warrant an investigation."

The letter refers to information that surfaced in May about top Administration officials meeting in the White House and personally approving the illegal techniques, and President Bush approving the results. The specific statutes that could have been violated, the letter states, are the Federal War Crimes Act, the Anti-Torture Act, and other U.S. and international laws.

Bush Regime Ties to Mobster Abramoff Get Fresh Look

June 9 (EIRNS)—The Bush Administration tried to play down its ties to political mobster Jack Abramoff, after it "conducted an inadequate and incomplete internal review" of its years-long collaboration with the Republican lobbyist who is now serving a 70-month sentence in Federal prison. That's the conclusion of a new report of the House Oversight and Government Reform Committee, chaired by Rep. Henry Waxman (D-Calif.) The committee's "proposed report" states that the evidence it examined "contradicts White House claims that with respect to his White House contacts, Mr. Abramoff got nothing out of it. Not only did Mr. Abramoff achieve some positive results from his White House lobbying, but White House officials sought out the views of Mr. Abramoff and his colleagues on matters of official business." Abramoff, who was up to his neck in a number of shady operations, including Indian-run gambling casinos, "influenced some White House actions," the new report says.

"The documents provided to the Committee by the White House document over 70 new contacts between Mr. Abramoff and his associates and White House officials," the report states. A September 2006 report by the same committee said Abramoff and his operatives had 485 contacts with White House officials, a figure the White House challenged. "The White House documents and e-mails do not corroborate 401 of the lobbying contacts described in the Greenberg Traurig documents," the report states, according to the Capitol Hill-based publication, The Hill.

According to the report's executive summary, the committee's investigation "was hindered in several ways that limit the scope" of its conclusions. Among them, "six individuals, including three former White House officials that the Committee sought to depose or interview refused in whole or part to answer the Committee's questions on Fifth Amendment grounds," the report states. These included Matt Kirk, a former top White House legislative affairs official; Susan Ralston, former assistant to White House Deputy Chief of Staff Karl Rove, who was also Abramoff's assistant; and Jennifer Farley, former deputy associate director of the Office of Intergovernmental Affairs at the White House.

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