Progress Report: Was Blind But Now I See

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Mon, 26 Sep 2005 07:34:05 -0700

Progress Report: Was Blind But Now I See

" American Progress Action Fund "

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AMERICAN PROGRESS ACTION FUND

The Progress Report

by Judd Legum, Faiz Shakir, Nico Pitney

Amanda Terkel, Payson Schwin and Christy Harvey

 

 

www.progressreport.org

9/26/2005

 

For news and updates throughout the day, check out our new blog at

ThinkProgress.org.

 

PROGRESS REPORT CHANGES: You'll notice a few changes in the sidebar

today. We're introducing two brand new features: State Watch, which

will highlight important stories impacting state and local communities

around the country; and Blog Watch, a one-stop-shop for the hottest

news from the blogosphere. Let us know what you think: email

pr.

 

ETHICS

Was Blind But Now I See

 

For years, Senate Majority Leader Sen. Bill Frist (R-TN) has clung to

his shares of his family's hospital company, HCA Inc, insisting that

his holdings did not constitute a conflict of interest, even as he

played a critical role in shaping the nation's health care policy.

This summer, everything suddenly changed. In June, Frist requested

that all his HCA stock, which was held in a " blind trust, " be sold. A

month later, the company announced that its earning were weakening and

the stock dropped nearly 15 percent from its peak. Frist claims that

he sold the stock to avoid the appearance of a conflict of interest.

But the suspicious timing of the sale has created serious problems for

Frist on a variety of fronts. (For more information, check out this

detailed timeline on ThinkProgress.org).

 

FRIST'S ETHICS PROBLEM: On June 13, 2005, Frist contacted his trustee

and instructed him to sell all of his HCA stock. Under Senate ethics

rules, Frist would be allowed to tell his trustee to sell a specific

stock only if the stock " creates a conflict of interest or the

appearance thereof due to the subsequent assumptions of duties. " Fred

Wertheimer, president of Democracy 21, identifies Frist's problem: " I

don't know what new duties he would point to above and beyond becoming

majority leader, and that was three years ago. "

 

FRIST'S LEGAL PROBLEM: Frist ordered his HCA stock to be sold at the

same time company insiders were selling large quantities of their

stock. For example, " From June 1 to June 10, six insiders sold a total

of 341,300 shares valued at $18.6 million, according to Thompson

Financial. " A month later, " the stock's price dropped 9 percent in a

single day because of a warning from the company about weakening

earnings. " If Frist possessed material non-public information about

HCA, the sale of his stock could constitute illegal insider trading.

The Securities and Exchange Commission and the Justice Department are

investigating.

 

FRIST'S HONESTY PROBLEM: In January 2003, Frist said in a television

interview, " I think really for our viewers it should be understood

that I put this into a blind trust. So as far as I know, I own no HCA

stock…I have no control. It is illegal right now for me to know what

the composition of those trusts are. So I have no idea. " That wasn't

true. The Associated Press reports that " just two weeks before those

comments, the trustee of the senator's trust, M. Kirk Scobey Jr.,

wrote to Frist that HCA stock was contributed to the trust. It was

valued at $15,000 and $50,000. " Even if investigators determine

Frist's recent sale was legal and ethical, Frist needs to explain why

he lied to the public about his trusts.

 

IRAQ

A Reason to Protest

 

This weekend, approximately 100,000 to 300,000 activists packed the

streets of Washington, DC in the " largest show of antiwar sentiment in

the nation's capital since the conflict in Iraq began. " The protests

come at a time when U.S. military deaths recently topped a " sobering

milestone " in Iraq, 58 percent of Americans disapprove of the overall

job President Bush is doing, 59 percent say the war was a mistake, and

63 percent say " some or all of our troops there should be withdrawn. "

While Bush struggles to demonstrate strong leadership in the midst of

the nation's hurricane recovery efforts, USA Today aids the president

in laying out a path for Iraq: " If Bush 'stays the course' in Iraq,

his ratings will hit bottom. If he fesses up that he was wrong and

gets us out, he still can salvage some of his presidency. "

 

SCALED-BACK AMBITIONS FOR IRAQ SPUR WORK ON EXIT STRATEGY: Bush

emphasized last week that, " Withdrawing our troops would make the

world more dangerous. " But according to counterterrorism and defense

sources, " Analysts at the Defense Intelligence Agency have begun

war-gaming scenarios for what might happen in Iraq if U.S. force

levels were cut back or eliminated. " The news from the Pentagon comes

amid growing concerns that the creation of a stable, democratic

government in Iraq is an unreachable objective. Last week, it was

reported that diplomats in the British Foreign Office were " working

frantically in private on what they refer to as the 'exit ticket' from

Iraq. " Scaled-back ambitions about achieving democratic reforms in

Iraq are driving the behind-the-scenes work on an exit strategy. One

British source said, " We will settle for leaving behind an Iraqi

democracy that is creaking along. "

 

MAKING THE REGION LESS SAFE FOR DEMOCRACY: Experts familiar with the

Middle East are warning that the world has already become more

dangerous as a result of the Bush policy in Iraq. The Saudi foreign

minister said last week, " The impression is gradually going toward

disintegration. There seems to be no dynamic now that is pulling the

country together. All the dynamics there are pushing the (Iraqi)

people away from each other. " Former head of the U.S. Central Command,

Gen. Joseph Hoar, recently said, " [R]egardless of what happens in

Iraq, these jihadis that are now there…, these people are going to be

well trained and be out of a job, and they're going to disperse into

the local countries and continue their work. " Hoar warned that

full-scale insurgencies could be seen in the future in surrounding

Middle Eastern countries, like Jordan, Saudi Arabia, or Kuwait.

Similarly, European officials are afraid that jihadists are returning

to Europe from Iraq " with combat experience, guerrilla-war skills,

ideological fervor and leadership status. "

 

BUSH'S IRAQ POSITION IS CHOICE BETWEEN LESSER OF TWO EVILS: In the

face of increasing protest, Bush allies have argued for the need to

stay the course based on an overly-rosy assessment of the situation on

the ground in Iraq. Bill Kristol, commenting on Fox News Sunday,

criticized the protesters: " We're having elections in Iraq a few weeks

from now. This is the time when suddenly we're going to pull the plug,

when things seem to be turning the corner. " The " election " to which

Kristol referred is actually a referendum on the Iraq constitution.

Far from promises that it will turn the corner in Iraq, the referendum

vote instead " carries the potential to further destabilize Iraq, no

matter which way it goes. " Approval of the Iraqi constitution " may

prove a bitter pill for Sunni Arabs to swallow, " thus fueling the

insurgency. But rejection of constitution " could throw the political

process back a year and complicate America's exit strategy. " The

International Crisis Group warned that the Iraq " constitution is

likely to fuel rather than dampen insurgency. " Meanwhile, Shiites are

fleeing Sunni-dominated neighborhoods, setting the stage for an

" all-out [civil] war. "

 

UNDER THE RADAR

 

HUMAN RIGHTS -- ARMY CAPTAIN ALLEGES " SYSTEMATIC ABUSE " OF IRAQI

PRISONERS: Time magazine yesterday revealed new allegations of

" systematic abuse " of Iraqi detainees made by a " decorated former

Captain in the Army's 82nd Airborne Division. " For months, Capt. Ian

Fishback said, U.S. soldiers were directed " to conduct daily beatings

of prisoners prior to questioning. " In one instance, " a soldier

allegedly broke a detainee's leg with a metal bat. " Other prisoners

had " their faces and eyes exposed to burning chemicals. " Fishback says

he told Army superiors of the abuse several times , but was met with

" repeated brush-offs. " Finally, he reported his charges to Human

Rights Watch (read HRW's full report). Now that the abuse is public,

the Army says it has launched a criminal investigation.

 

KATRINA -- CONTRACTS RIFE WITH CRONYISM, WASTE, AND FRAUD: The New

York Times reports that billions of dollars worth of Katrina contracts

have been awarded without competitive bidding: " More than 80 percent

of the $1.5 billion in contracts signed by the Federal Emergency

Management Agency alone were awarded without bidding or with limited

competition, government records show, provoking concerns among

auditors and government officials about the potential for favoritism

or abuse. " Rep. Bennie Thompson (D-MS) said of the situation, " There

is just more of the good-old-boy system, taking care of its political

allies. ... FEMA and the others have put out these contracts in such a

haphazard manner, I don't know how they can come up with anything that

is accountable to the taxpayers. "

 

POVERTY -- IMF AND WORLD BANK RELIEVE DEBT OF POOR NATIONS: Building

upon the agreements in July reached by the Group of Eight (G-8) major

industrialized countries, the International Monetary Fund (IMF) and

the World Bank yesterday agreed to erase up to $57.5 billion in debt

for almost 40 nations, most of which are in sub-Saharan Africa. The

United States and other members of the G-8 group have promised to

replenish the World Bank's resources to make up for the revenue that

will be lost when it forgives the loans. The Wall Street Journal

reported, " Antipoverty advocates...say poor nations will be able to

devote more resources to schools, health care, agriculture and other

needs. "

 

INTELLIGENCE -- CIA CHIEF PORTER GOSS FACES INTERNAL CONCERNS ABOUT

HIS LEADERSHIP: " Personal and political feuding at CIA headquarters

is turning into a soap opera, " Newsweek reports. Since taking over as

CIA chief, Porter Goss has fired senior managers and CIA critics have

faulted the agency for miscues in the hunt for Al Qaeda and WMD. Last

week, the internal frustrations became more public after Rob Richer,

former deputy chief of the CIA's spy branch, testified before the

Senate Intelligence Committee. Unnamed sources told Newsweek that

Richer expressed his unhappiness with Goss' leadership. Also, CIA

personnel grilled Goss last week during a private " town hall " session

about his hiring of a former congressional staffer.

 

ADMINISTRATION -- MORE " MIKE BROWNS " : Cronyism in government didn't

start with Mike Brown. But as Time reported, " The difference is that

this Bush Administration had a plan from day one for remaking the

bureaucracy. " Appointees have included Scott Gottlieb at the Food and

Drug Administration, who had financial ties to the drug industry he

was supposed to regulate. David Safavian, the now-embattled head of

procurement for the federal government, " had great party credentials

but no substantive credentials. " Despite the administration's recent

bad press over its political appointees, it doesn't appear to have

learned its lesson, recently trying to push through Julie Myers as the

head of Immigration and Customs Enforcement. Myers's qualifications?

She is the niece of Richard Myers, chairman of the Joint Chiefs of

Staff, and the wife of Secretary Chertoff's chief of staf

 

GOOD NEWS

 

Lester Crawford, the FDA commissioner who presided over the Vioxx

scandal, and who repeatedly blocked the over-the-counter sale of the

" morning after " pill, resigned from the agency on Friday.

 

DAILY GRILL

 

" When Mr. McClellan announced that the president had scrapped his trip

[to San Antonio to oversee Hurricane Rita preparations], he said that

with the search-and-rescue team preparing to move with the storm, 'we

didn't want to slow that down.' "

-- New York Times, 9/24/05, on the official reason President Bush

decided not to travel to San Antonio on Friday afternoon

 

VERSUS

 

" President Bush was supposed to land [in San Antonio] on Friday

afternoon...ut the weather did not cooperate. It was too sunny. " A

White House official " involved in preparing Mr. Bush's way noted that

with the sun shining so brightly in San Antonio, the images of Mr.

Bush from here might not have made it clear to viewers that he was

dealing with an approaching storm. "

-- New York Times, 9/24/05, on the unofficial reason President Bush

didn't take the trip.

STATE WATCH

PENNSYLVANIA: Eleven parents go to federal court to challenge the

Dover Area School District's teaching of intelligent design in science

classes.

NORTH CAROLINA: Raleigh schools credit improved test scores with its

system of integration by income.

GEORGIA: Gov. Sonny Perdue ® faces criticism for his call to close

Georgia schools for two days this week to save diesel fuel.

BLOG WATCH

THINK PROGRESS: Exclusive interview with retired Marine Gen. Joseph

Hoar, who headed U.S. Central Command following Gen. Norman Schwarzkopf.

SHAKESPEARE'S SISTER: President Bush's " extraordinary appeal " for

Americans to donate out-of-pocket money to Iraq's reconstruction has

raised just $600.

LABOR BLOG: The Bush administration is working up a trade deal with

the United Arab Emirates, site of " some of the most savage abuse of

workers in the world. " Will binding labor rights be included?

EVOLVETV: Markos Moulitsas of DailyKos.com interviews Middle East

expert and fellow blogger Juan Cole.