Culture of Corruption: Obama and His Team of Tax Cheats, Crooks, and Cronies (20 page)

It wasn’t only Republican partisans who questioned the crony CIA appointment. Senate Select Committee on Intelligence chair Democrat Diane Feinstein of California was so dumbfounded by Panetta’s nomination to helm the agency that she released a biting statement noting that her own position “has consistently been that I believe the Agency is best-served by having an intelligence professional in charge at this time.” An aide to Democrat Senator Jay Rockefeller pronounced his boss “puzzled by the selection” because “he has always believed that the director of CIA needs to be someone with significant operational intelligence experience, and someone outside the political realm.”
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Defense analyst Michael O’Hanlon of the left-leaning Brookings Institution frowned on Panetta for never holding down a single “major job in national security.” The nomination, he said, “seems to be Obama’s weakest appointment in that sphere.”
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Forced to disclose his financial assets and interests before his Senate confirmation, Panetta at least helped to inform the public of the lifestyles of the rich and entrenched. His disclosure forms show that he earned more than $1.2 million in investment, speaking, and consulting fees since the beginning of 2008, including:

• $56,000 from Merrill Lynch & Co. for two speeches;

• $28,000 for a speech for Wachovia Corp;

• $28,000 for an honorarium from the Carlyle Group, a private-equity firm whose companies do business with national security bureaucracies within the federal government;

• $60,000 in “Governmental Advisory Fees” from the shipping lobbyists of the Pacific Maritime Association;

• $130,000 in director’s fees from big-time lobbying firm Fleishman Hillard;

• $150,000 in consulting fees from California State University, which hosts the Leon & Sylvia Panetta Institute for Public Policy, a nonprofit think tank run by Mr. Panetta and his wife
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—which, coincidentally enough, just happened to publish a survey showing wide support for Obama among college students in spring 2008 and disapproval of rival Republican John McCain and President George W. Bush;
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• $125,000 in director fees from BP Corporation North America;

• $93,000 from Blue Shield of California; and

• $170,000 from Zenith National Insurance (in which he also owns stock worth up to $350,000).
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Technically speaking, lobbyist-lite Panetta never registered as a federal lobbyist, so technically speaking, Obama did not violate his no-lobbyists-in-charge hiring rule. But HopeAndChange™ was supposed to be about the most qualified officials meeting the highest standards, not the most unqualified political hacks eking by on technicalities, wasn’t it?

Offering the emptiest reassurance, White House spokesman Tommy Vietor said Panetta’s income and investments “have been thoroughly reviewed by the Office of Government Ethics.” Vietor instead touted Mr. Panetta’s views about how to strengthen our intelligence gathering and keep our nation safe. But a vetting of Panetta’s income and investments illustrates the fundamental problem with Obama’s choice: he’s an access trader whose expertise lies not in national security, but in Washington job security.

COMMERCE SECRETARY GARY LOCKE: CHINAGATE-TAINTED, INTEREST - CONFLICTED CRONY

After two botched attempts to fill the top post at the Commerce Department, the Obama White House finally settled on the former Democratic governor of Washington state, Gary Locke. Team Obama regarded Locke as, well, a lock. The national media dutifully toed the Good Gary line.

The
Washington Post
quoted officials touting him as a “safe choice” because of his “long history in public life, his strait-laced reputation and his bipartisan governing credentials.”
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The
New York Times
“reported” that Locke, “the nation’s first and only Chinese-American governor and now an expert on China issues as a partner in a prominent Seattle law firm, brings something new: an international focus, centrist pragmatism, strong skills in public policy and a largely scandal-free résumé.”
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“Obama’s New Commerce Pick Has Clean Reputation,” declared National Public Radio.
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But repeating the Mr. Clean claim doesn’t make it so. Locke’s laces ain’t tied so straight. I covered Locke when I worked at the
Seattle Times
in the late 1990s. I dealt with his campaign and gubernatorial staffs. “Strait-laced” and “clean reputation” are not the phrases I’d use from my dealings with him and his people. Those in his home state who know Locke best paint a far grimier picture of a crony politician with a serial habit of skirting campaign finance laws and conflict-of-interest rules. In other words: Locke’s spotty record made him a good fit for the ethically impaired Obama administration.

The left-leaning
Seattle Weekly
newspaper notes that Locke presided over a $3.2 billion tax break for Boeing as governor, while “never disclosing he paid $715,000 to—and relied on the advice of—Boeing’s own private consultant and outside auditor for advice.”
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The state paid the auditor, Deloitte Consulting, the $715,000 in taxpayer funds to help land the Boeing Dreamliner assembly plant with the largest tax incentive in Washington state history. Oh, and Boeing just happened to be a $5 million Deloitte client.
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Great coinky-dinks!

Then there’s the tainted matter of Locke’s “favors for his brother-in-law (who lived in the governor’s mansion), including a tax break for his relative’s company, personal intervention in a company dispute, and Locke’s signature on a federal loan application for the company.”
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Republicans inquiring into the contract determined there was no illegality, but it was just too close for comfort for some ethics watchdogs. The
Seattle Weekly’
s Rick Anderson reported that Locke’s brother-in-law, Judd Lee, served as chief financial officer for SafeHarbor Technology. The company snagged a master contract from the state after Locke promoted it and championed nearly $12.7 million in tax breaks and state economic aid to benefit the company and its industry. In addition, Governor Locke aided his brother-in-law’s company by funneling federal aid to it through a public corporation pipeline.
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Locke denied any conflict of interest and maintained that he never spoke about business to the brother-in-law who lived in his gubernatorial mansion (and frequently brought guests to tour the stately home). Well, duh. He didn’t have to say a word. The language of nepotism is always spoken with winks and nudges.

Most alarming, the glowing profiles of Locke largely glossed over his troubling ties to the Clinton-era Chinagate scandal. As the nation’s first Chinese-American governor, Locke aggressively raised cash from ethnic constituencies around the country. Convicted campaign finance money-launderer John Huang helped grease the wheels and open doors. In the same time period he was drumming up illegal cash for Clinton-Gore at the federal level, Huang organized two 1996 galas for Locke in Washington, D.C. (where Locke hobnobbed with Clinton and other Chinagate principals); three fund-raisers in Los Angeles; and an extravaganza at the Universal City, California, Hilton in October 1996 that raised upwards of $30,000. Huang also made personal contributions to Locke—as did another Clinton-Gore funny money figure, Indonesian business mogul Ted Sioeng, and his family and political operatives. Sioeng, whom Justice Department and intelligence officials suspected of acting on behalf of the Chinese government, illegally donated hundreds of thousands of dollars to both Democrat and Republican coffers.
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Checks to Locke’s campaign poured in from prominent Huang and Sioeng associates, many of whom were targets of federal investigations, including: Hoyt Zia, a Commerce Department counsel, who stated in a sworn deposition that Huang had access to virtually any classified document through him; Melinda Yee, another Clinton Commerce Department official who admitted to destroying Freedom-of-Information-Act-protected notes on a China trade mission involving Huang’s former employer, the Indonesia-based Lippo Group; Praitun Kanchanalak, mother of convicted Thai influence-peddler Pauline Kanchanalak; Kent La, exclusive distributor of Sioeng’s Chinese cigarettes in the United States; and Sioeng’s wife and son-in-law.
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Bank records from congressional investigators also indicated that an associate of Sioeng made a maximum individual contribution to Locke that was then illegally reimbursed by Sioeng’s daughter.

Locke eventually returned
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a token amount of money from Huang and Kanchanalak, but not before bitterly playing the race card and accusing critics of his sloppy accounting and questionable schmoozing of stirring up anti-Asian-American sentiment. “It will make our efforts doubly hard to get Asian-Americans appointed to top-level positions across the United States,” Locke complained. “If they have any connection to John Huang, those individuals will face greater scrutiny and their lives will be completely opened up and examined—perhaps more than usual.”
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That scrutiny (such as it was) was more than justified. On top of his Chinagate entanglements, Locke’s political committee was fined the maximum amount by Washington’s campaign finance watchdog for failing to disclose out-of-state New York City Chinatown donor events.
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One of those events was held at NYC’s Harmony Palace restaurant, co-owned by Chinese street gang thugs. And then there were Locke’s not-so-squeaky-clean fund-raising trips to a Buddhist temple in Redmond, Washington, which netted nearly $14,000 from monks and nuns—many of whom barely spoke English, couldn’t recall donating to Locke, or were out of the country and could never be located. Of the known temple donors identified by the Locke campaign, five gave $1,000 each on July 22, 1996—paid in sequentially ordered cashier’s checks. Two priests gave $1,000 and $1,100 respectively on August 8, 1996. Three other temple adherents also gave $1,000 contributions on August 8. Internal campaign records show that two other temple disciples donated $2,000 and $1,000 respectively on other dates. State campaign finance investigators failed to track down some of the donors during their probe.
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But while investigating the story for the
Seattle Times
, I interviewed temple donor Siu Wai Wong, a bald, robed, 40-year-old priest who could not remember when or by what means he had given a $1,000 contribution to Locke. He also refused to say whether he was a U.S. citizen, explaining that his “English [was] not so good.”
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Although an inept state campaign-finance panel absolved Locke and his campaign of any wrongdoing, the extensive public record clearly shows that the Locke campaign used Buddhist monks as conduits for laundered money.
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The longtime reluctance to press Locke—who became a high-powered attorney specializing in China trade issues for international law firm Davis, Wright & Tremaine after leaving the governor’s mansion—on his reckless, ethnic-based fundraising extended to the politically correct and cowed Beltway. Instead of questioning his abysmal judgment, supporters touted Locke’s cozy relations with the Chinese government as a primary reason he deserved the Commerce Department post. He sailed through the Senate confirmation process, with GOP Senator Kay Bailey Hutchison cluelessly concluding that Locke’s background check was “boring.”
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Thanks to Republicans asleep at the wheel, Teflon Gary evaded tough scrutiny once again. Like Panetta, he skirted Obama’s no-lobbyist-rule, despite having lobbied the Chinese government on behalf of Microsoft, Starbucks, Weyerhauser timber, and other Washington state businesses. He traveled five times to China seeking loosened restrictions and favors for his clients, including an American bank seeking to establish a presence in the Communist regime. He also served as a fixer for Chinese nationals demanding streamlined visa applications and as a travel agent for Chinese President Hu Jintao when he visited the United States in 2006.
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But since Locke didn’t lobby the U.S. government, Obama didn’t count his lobbying work as “lobbying.” See no lobbying, hear no lobbying, speak no lobbying. “We are confident,” a White House aide insisted, “that Governor Locke will be able to continue to advocate on behalf of American businesses and workers while at the same time adhering to the administration’s ethics policy.”
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Confidence built on delusion—an unmistakable mark of the Obama administration beast.

HUD’ S NO. 2 MAN RON SIMS: ENEMY OF TRANSPARENCY

If you need a simple, shining example of the utter disingenuousness of Barack Obama’s commitment to government transparency, I have two words for you: Ron Sims. This lifelong political hack is to transparency what sunlight is to Dracula, what salt is to a slug, what kryptonite is to Superman, what
The View
is to intelligent debate.

That is: lethal.

In its press release announcing the nomination of the Seattle-area county executive to the number two post at the U.S. Department of Housing and Urban Development, the White House described Sims as a “visionary urban leader.” The White House also touted Sims’s “willingness to make the tough choices necessary to ensure that American tax dollars are spent wisely.” But his key accomplishments in the Pacific Northwest have involved illegally keeping taxpayers in the dark. Despite his long-known notoriety in Washington state as an incompetent manager and obstinate campaign finance law-breaker, President Obama has entrusted Sims to oversee the day-to-day operations of a federal agency with 8,500 employees, a $39 billion yearly budget, and a chronic history of corruption and cronyism.