Do you want to get rich? Just get elected to Congress. The U.S. Senate and the House of Representatives are absolutely packed with wealthy people that are very rapidly becoming even wealthier. The collective net worth of the members of Congress is now measured in the billions of dollars. The people that we have elected to the House and Senate are absolutely swimming in money. Unfortunately, it is not easy to get elected to Congress. In this day and age you generally have to be heavily connected to those that are very wealthy to get into Congress because it takes gigantic amounts of cash to win campaigns. But if you can get in to the club, you pretty much have it made. The numbers that you are about to read are very difficult to believe and they should deeply sadden you. They show that Congress has become all about money. Congressional races are mostly financed by wealthy people, most of the people that we elect to Congress are very wealthy, and they rapidly get wealthier after they are elected. All of this money has turned our republic into something far different than our founding fathers intended.
The following are 12 statistics about money and Congress that are so outrageous that it is hard to believe that they are actually true....
#1 The collective net worth of all of the members of Congress increased by 25 percent between 2008 and 2010.
#2 The collective net worth of all of the members of Congress is now slightly over 2 billion dollars. That is "billion" with a "b".
#3 This happened during a time when the net worth of most American households was declining rapidly. According to the Federal Reserve, the collective net worth of all American households decreased by 23 percent between 2007 and 2009.
#4 The average net worth for a member of Congress is now approximately 3.8 million dollars.
#5 The net worth of House Minority Leader Nancy Pelosi increased by 62 percent from 2009 to 2010. In 2009 it was reported that she had a net worth of 21.7 million dollars, and in 2010 it was reported that she had a net worth of 35.2 million dollars.
#6 The top Republican in the Senate, Mitch McConnell, saw his wealth grow by 29 percent from 2009 to 2010. He is now worth approximately 9.8 million dollars.
#7 More than 50 percent of the members of the U.S. Congress are millionaires.
#8 In 2008, the average cost of winning a seat in the House of Representatives was $1.1 million and the average cost of winning a seat in the U.S. Senate was $6.5 million. Spending on political campaigns has gotten way out of control.
#9 Insider trading is perfectly legal for members of the U.S. Congress - and they refuse to pass a law that would change that.
#10 The percentage of millionaires in Congress is more than 50 times higher than the percentage of millionaires in the general population.
#11 U.S. Representative Darrell Issa is worth approximately 220 million dollars. His wealth grew by approximately 37 percent from 2009 to 2010.
#12 The wealthiest member of Congress, U.S. Representative Michael McCaul, is worth approximately 294 million dollars.
So how are members of Congress becoming so wealthy?
Well, there are lots of ways they are raking in the cash, but one especially alarming thing that goes on is that members of Congress often make investments in companies that will go up significantly if legislation that is being considered by Congress "goes the right way".
This is called a "conflict of interest", but it happens constantly in Congress and nobody seems to get into any trouble for it.
The following is video of Steve Kroft of 60 Minutes ambushing Nancy Pelosi about one particular conflict of interest involving credit card legislation. As you can see, she does not want to talk about it....
Popout
As noted above, insider trading is perfectly legal for members of Congress.
A law that would ban insider trading by members of Congress has been stalled for years on Capitol Hill.
So has this been a significant benefit to members of Congress?
Well, there has been at least one study that appears to indicate that members of Congress have been much more successful in the stock market than members of the general public have....
A 2004 study of the results of stock trading by United States Senators during the 1990s found that that senators on average beat the market by 12% a year. In sharp contrast, U.S. households on average underperformed the market by 1.4% a year and even corporate insiders on average beat the market by only about 6% a year during that period. A reasonable inference is that some Senators had access to - and were using - material nonpublic information about the companies in whose stock they trade.
Of course all of this could just be a coincidence, right?
Meanwhile, members of Congress keep telling the rest of us that we are just going to have to cut back because times are tough.
For example, during an interview with George Stephanopoulos of ABC News, Nancy Pelosi actually claimed that we should try to encourage poor people to have less children because it costs the government so much money to take care of them....
PELOSI: Well, the family planning services reduce cost. They reduce cost. The states are in terrible fiscal budget crises now and part of what we do for children's health, education and some of those elements are to help the states meet their financial needs. One of those - one of the initiatives you mentioned, the contraception, will reduce costs to the states and to the federal government.
STEPHANOPOULOS: So no apologies for that?
PELOSI: No apologies. No. we have to deal with the consequences of the downturn in our economy.
This elitist attitude extends all the way into the White House as well. Earlier this year, Barack Obama made the following statement....
"If you’re a family trying to cut back, you might skip going out to dinner, or you might put off a vacation."
Meanwhile, the Obamas are living the high life at taxpayer expense. In a previous article I mentioned one outrageously expensive vacation taken by the Obamas that was paid for by our taxes....
"Back in August, Michelle Obama took her daughter Sasha and 40 of her friends for a vacation in Spain.
So what was the bill to the taxpayers for that little jaunt across the pond?
It is estimated that vacation alone cost U.S. taxpayers $375,000."
There is a massive disconnect between what our politicians say and what our politicians do.
The high life is good enough for them, but the rest of us have got to "cut back" and suffer becomes times are hard.
But when it comes to money and Congress, the most corrupting influence of all is probably all of the campaign money that gets thrown around.
In America today, it takes gigantic mountains of money to run a successful campaign.
Sadly, the candidate that raises the most money almost always wins. In federal elections the candidate that raises the most money wins about 90 percent of the time.
More than 5 billion dollars were spent on political campaigns back in 2008.
That represents a huge number of favors that need to be paid back.
In 2012, it is being projected that 8 billion dollars could be spent on political campaigns.
When big corporations and wealthy individuals shovel huge piles of money into political campaigns, it is generally because they expect something in return.
Most of those that get sent to Congress realize that they never would have won if wealthy donors had not showered cash on them. Most of them understand that they should not bite the hands that feed them if they want the cash to keep rolling in.
Politics in America has become a game that is played by the elite for the benefit of the elite.
Average Americans have the perception that they are involved in the process and that their opinions really matter, but mostly it is just an illusion.
It is so sad.
Meanwhile, members of Congress rapidly get wealthier and average American families continue to suffer. In fact, the standard of living in the United States has fallen farther over the past three years than at any other time that has ever been recorded in U.S. history.
But for members of Congress the good times just keep on rolling.
Just as it has been for most of human history, the rich rule over the poor.
Does anyone out there believe that we have any hope of changing this?
Wednesday, November 9, 2011
Sunday, November 6, 2011
A commentary on the OWS movement
From Mary Beth Hicks (commentator for the Washington Times)
Call it an occupational hazard, but I can’t look at the Occupy Wall Street protesters without thinking, “Who parented these people?”
As a culture columnist, I’ve commented on the social and political ramifications of the “movement” – now known as “OWS” – whose fairyland agenda can be summarized by one of their placards: “Everything for everybody.”
Thanks to their pipe-dream platform, it’s clear there are people with serious designs on “transformational” change in America who are using the protesters like bedsprings in a brothel.
Yet it’s not my role as a commentator that prompts my parenting question, but rather the fact that I’m the mother of four teens and young adults. There are some crucial life lessons that the protesters’ moms clearly have not passed along.
Here, then, are five things the OWS protesters’ mothers should have taught their children but obviously didn’t, so I will.
• Life isn’t fair. The concept of justice – that everyone should be treated fairly – is a worthy and worthwhile moral imperative on which our nation was founded. But justice and economic equality are not the same. Or, as Mick Jagger [2] said, “You can’t always get what you want.”
No matter how you try to “level the playing field,” some people have better luck, skills, talents or connections that land them in better places. Some seem to have all the advantages in life but squander them, others play the modest hand they’re dealt and make up the difference in hard work and perseverance, and some find jobs on Wall Street and eventually buy houses in the Hamptons. Is it fair? Stupid question.
• Nothing is “free.” Protesting with signs that seek “free” college degrees and “free” health care make you look like idiots, because colleges and hospitals don’t operate on rainbows and sunshine. There is no magic money machine to tap for your meandering educational careers and “slow paths” to adulthood, and the 53 percent of taxpaying Americans owe you neither a degree nor an annual physical.
While I’m pointing out this obvious fact, here are a few other things that are not free: overtime for police officers and municipal workers, trash hauling, repairs to fixtures and property, condoms, Band-Aids and the food that inexplicably appears on the tables in your makeshift protest kitchens. Real people with real dollars are underwriting your civic temper tantrum.
• Your word is your bond. When you demonstrate to eliminate student loan debt, you are advocating precisely the lack of integrity you decry in others. Loans are made based on solemn promises to repay them. No one forces you to borrow money; you are free to choose educational pursuits that don’t require loans, or to seek technical or vocational training that allows you to support yourself and your ongoing educational goals. Also, for the record, being a college student is not a state of victimization. It’s a privilege that billions of young people around the globe would die for – literally.
• A protest is not a party. On Saturday in New York, while making a mad dash from my cab to the door of my hotel to avoid you, I saw what isn’t evident in the newsreel footage of your demonstrations: Most of you are doing this only for attention and fun. Serious people in a sober pursuit of social and political change don’t dance jigs down Sixth Avenue like attendees of a Renaissance festival. You look foolish, you smell gross, you are clearly high and you don’t seem to realize that all around you are people who deem you irrelevant.
• There are reasons you haven’t found jobs. The truth? Your tattooed necks, gauged ears, facial piercings and dirty dreadlocks are off-putting. Nonconformity for the sake of nonconformity isn’t a virtue. Occupy reality: Only 4 percent of college graduates are out of work. If you are among that 4 percent, find a mirror and face the problem. It’s not them. It’s you.
(© 2011 Marybeth Hicks)
Call it an occupational hazard, but I can’t look at the Occupy Wall Street protesters without thinking, “Who parented these people?”
As a culture columnist, I’ve commented on the social and political ramifications of the “movement” – now known as “OWS” – whose fairyland agenda can be summarized by one of their placards: “Everything for everybody.”
Thanks to their pipe-dream platform, it’s clear there are people with serious designs on “transformational” change in America who are using the protesters like bedsprings in a brothel.
Yet it’s not my role as a commentator that prompts my parenting question, but rather the fact that I’m the mother of four teens and young adults. There are some crucial life lessons that the protesters’ moms clearly have not passed along.
Here, then, are five things the OWS protesters’ mothers should have taught their children but obviously didn’t, so I will.
• Life isn’t fair. The concept of justice – that everyone should be treated fairly – is a worthy and worthwhile moral imperative on which our nation was founded. But justice and economic equality are not the same. Or, as Mick Jagger [2] said, “You can’t always get what you want.”
No matter how you try to “level the playing field,” some people have better luck, skills, talents or connections that land them in better places. Some seem to have all the advantages in life but squander them, others play the modest hand they’re dealt and make up the difference in hard work and perseverance, and some find jobs on Wall Street and eventually buy houses in the Hamptons. Is it fair? Stupid question.
• Nothing is “free.” Protesting with signs that seek “free” college degrees and “free” health care make you look like idiots, because colleges and hospitals don’t operate on rainbows and sunshine. There is no magic money machine to tap for your meandering educational careers and “slow paths” to adulthood, and the 53 percent of taxpaying Americans owe you neither a degree nor an annual physical.
While I’m pointing out this obvious fact, here are a few other things that are not free: overtime for police officers and municipal workers, trash hauling, repairs to fixtures and property, condoms, Band-Aids and the food that inexplicably appears on the tables in your makeshift protest kitchens. Real people with real dollars are underwriting your civic temper tantrum.
• Your word is your bond. When you demonstrate to eliminate student loan debt, you are advocating precisely the lack of integrity you decry in others. Loans are made based on solemn promises to repay them. No one forces you to borrow money; you are free to choose educational pursuits that don’t require loans, or to seek technical or vocational training that allows you to support yourself and your ongoing educational goals. Also, for the record, being a college student is not a state of victimization. It’s a privilege that billions of young people around the globe would die for – literally.
• A protest is not a party. On Saturday in New York, while making a mad dash from my cab to the door of my hotel to avoid you, I saw what isn’t evident in the newsreel footage of your demonstrations: Most of you are doing this only for attention and fun. Serious people in a sober pursuit of social and political change don’t dance jigs down Sixth Avenue like attendees of a Renaissance festival. You look foolish, you smell gross, you are clearly high and you don’t seem to realize that all around you are people who deem you irrelevant.
• There are reasons you haven’t found jobs. The truth? Your tattooed necks, gauged ears, facial piercings and dirty dreadlocks are off-putting. Nonconformity for the sake of nonconformity isn’t a virtue. Occupy reality: Only 4 percent of college graduates are out of work. If you are among that 4 percent, find a mirror and face the problem. It’s not them. It’s you.
(© 2011 Marybeth Hicks)
Monday, October 10, 2011
Sunday, September 18, 2011
Stick a fork in, Obama is done
Stick a fork in, Obama is done
[See also: Obama’s 'Crony-Gate' Scandal Widens — Billions Now Under Scrutiny]
The Solyndra Fraud
By Andrew McCarthy, NRO
The solar-energy company was a con game.
The Solyndra debacle is not just Obama-style crony socialism as usual. It is a criminal fraud. That is the theory that would be guiding any competent prosecutor’s office in the investigation of a scheme that cost victims — in this case, American taxpayers — a fortune.
Fraud against the United States is one of the most serious felony offenses in the federal penal law. It is even more serious than another apparent Solyndra violation that has captured congressional attention: the Obama administration’s flouting of a statute designed to protect taxpayers.
Homing in on one of the several shocking aspects of the Solyndra scandal, lawmakers noted that, a few months before the “clean energy” enterprise went belly-up last week, the Obama Energy Department signed off on a sweetheart deal. In the event of bankruptcy — the destination to which it was screamingly obvious Solyndra was headed despite the president’s injection of $535 million in federal loans — the cozily connected private investors would be given priority over American taxpayers. In other words, when the busted company’s assets were sold off, Obama pals would recoup some of their losses, while you would be left holding the half-billion-dollar bag.
As Andrew Stiles reported here at NRO, Republicans on the Oversight and Investigations subcommittee say this arrangement ran afoul of the Energy Policy Act of 2005. This law — compassionate conservatism in green bunting — is a monstrosity, under which Leviathan, which can’t run a post office, uses your money to pick winners and losers in the economy’s energy sector. The idea is cockamamie, but Congress did at least write in a mandate that taxpayers who fund these “investments” must be prioritized over other stakeholders. The idea is to prevent cronies from pushing ahead of the public if things go awry — as they are wont to do when pols fancy themselves venture capitalists.
On the Energy Policy Act, the administration’s malfeasance is significant, but secondary. That’s because the act is not a penal statute. It tells the cabinet officials how to structure these “innovative technology” loans, but it provides no remedy if Congress’s directives are ignored.
The criminal law, by contrast, is not content to assume the good faith of government officials. It targets anyone — from low-level swindlers to top elective officeholders — who attempts to influence the issuance of government loans by making false statements; who engages in schemes to defraud the United States; or who conspires “to defraud the United States, or any agency thereof, in any manner or for any purpose.” The penalties are steep: Fraud in connection with government loans, for example, can be punished by up to 30 years in the slammer.
Although Solyndra was a private company, moreover, it was using its government loans as a springboard to go public. When the sale of securities is involved, federal law criminalizes fraudulent schemes, false statements of material fact, and statements that omit any “material fact necessary in order to make the statements made . . . not misleading.” And we’re not just talking about statements made in required SEC filings. Any statement made to deceive the market can be actionable. In 2003, for example, the Justice Department famously charged Martha Stewart with securities fraud. Among other allegations, prosecutors cited public statements she had made in press releases and at a conference for securities analysts — statements in which she withheld damaging information in an effort to inflate the value of her corporation and its stock.
That’s exactly what President Obama did on May 26, 2010, with his Solyndra friends about to launch their initial public offering of stock. The solar-panel company’s California factory was selected as the fitting site for a presidential speech on the virtues of confiscating taxpayer billions to prop up pie-in-the-sky clean-energy businesses.
By then, the con game was already well under way. Solyndra had first tried to get Energy Act funding during the Bush administration, but had been rebuffed shortly before President Bush left office. Small wonder: Solyndra, as former hedge-fund manager Bruce Krasting concluded, was “an absolute complete disaster.” Its operating expenses, including supply costs, nearly doubled its revenue in 2009 — and that’s without factoring in capital expenditures and other costs in what, Krasting observes, is a “low margin” industry. The chance that Solyndra would ever become profitable was essentially nonexistent, particularly given that solar-panel competitors backed by China produce energy at drastically lower prices.
Yet, as Stiles reports, within six days of Obama’s taking office, an Energy Department official acknowledged that the Solyndra “approval process” was suddenly being considered anew. Eventually, the administration made Solyndra the very first recipient of a public loan guarantee when the Energy Act program was beefed up in 2009 — just part of nearly a trillion dollars burned through under the Obama stimulus.
For a while after Solyndra tanked, the administration stonewalled the House subcommittee’s investigation, but we now know that minions in the Energy Department and the Office of Management and Budget had enormous qualms about the Solyndra loan. They realized that the company was hemorrhaging money and, even with the loan, would lack the necessary working capital to turn that equation around. Yet they caved under White House pressure to sign off in time for Vice President Joe Biden to make a ballyhooed announcement of the loan in September 2009. An OMB e-mail laments that the timing of the loan approval was driven by the politics of the announcement “rather than the other way around.”
Why so much pressure to give half a billion dollars to a doomed venture? The administration insists it had nothing whatsoever to do with the fact that Solyndra’s big backers include the George Kaiser Family Foundation. No, of course not. George Kaiser, an Oklahoma oil magnate, just happens to be a major Obama fundraiser who bundled oodles in contributions for the president’s 2008 campaign. Solyndra officers and investors are said to have visited the White House no fewer than 20 times while the loan guarantee was being considered and, later, revised. Kaiser, too, made several visits — but not to worry: Both he and administration officials deny any impropriety. You’re to believe that the White House was just turning up the heat on OMB and DOE because Solyndra seemed like such a swell investment.
Except it didn’t seem so swell to people who knew how to add and subtract, and those people weren’t all at OMB and DOE. Flush with confidence that their mega-loan from Uncle Sam would make the company attractive to private investors, Solyndra’s backers prepared to take the company public. Unfortunately, SEC rules for an initial public offering of stock require the disclosure of more than Obama speeches glowing with solar power. Companies that want access to the market have to reveal their financial condition.
In Solyndra’s case, outside auditors from PricewaterhouseCoopers (PWC) found that condition to be dire. “The company has suffered recurring losses from operations, negative cash flows since inception, and has a net stockholders’ deficit,” the PWC accountants concluded. Even with the gigantic Obama loan, Solyndra was such a basket case that PWC found “substantial doubt about its ability to continue as a going concern.”
The “going concern” language is not boilerplate. As Townhall finance maven John Ransom explains, it is a term of art to which auditors resort when there is an extraordinary need to protect themselves and the company from legal liability. Angry investors who’ve lost their shirts tend to scapegoat the loser company’s accountants. In truth, even if the accountants affixed a neon “going concern” sign to the company’s financial statements, investors would have no one but themselves to blame. But it is unusual: The language is absent from the statements of many companies that actually end up going bankrupt. Auditors reserve it for the hopeless causes — like Solyndra.
With no alternative if they wanted to make a play for market financing, Solyndra’s backers disclosed the auditors’ bleak diagnosis in March 2010. The government had thus been aware of it for two months when President Obama made his May 26 Solyndra speech — the speech Solyndra backers were clearly hoping would mitigate the damage.
As president, Obama had a fiduciary responsibility to be forthright about Solyndra’s grim prospects — in speaking to the American taxpayers whose money he had redistributed, and to the American investors who were about to be solicited for even more funding. Instead, he pulled a Martha Stewart.
The president looked us in the eye and averred that, when it came to channeling public funds into private hands, “We can see the positive impacts right here at Solyndra.” He bragged that the $535 billion loan had enabled the company to build the state-of-the-art factory in which he was then speaking. He said nothing about how Solyndra was continuing to lose money — public money — at a catastrophic pace. Instead, he painted the brightest of pictures: 3,000 construction workers to build the thriving plant; manufacturers in 22 states building an endless stream of supplies; technicians in a dozen states constructing the advanced equipment that would make the factory hum; and Solyndra fully “expect[ing] to hire a thousand workers to manufacture solar panels and sell them across America and around the world.”
Not content with that rosy portrait, the president further predicted a “ripple effect”: Solyndra would “generate business for companies throughout our country who will create jobs supplying this factory with parts and materials.” Sure it would. The auditors had scrutinized Solyndra and found it to have, from its inception, a fatally flawed business model that was hurtling toward collapse. Obama touted it as a redistribution success story that would be rippling jobs, growth, and spectacular success for the foreseeable future.
It was a breathtaking misrepresentation. Happily, it proved insufficient to dupe investors who, unlike taxpayers, get to choose where their money goes. They stacked what the administration was saying against what the PWC auditors were saying and wisely went with PWC. Solyndra had to pull its initial public offering due to lack of interest.
But fraud doesn’t have to be fully successful to be a fraud, and this one still had another chapter to go. As the IPO failed and the company inevitably sank in a sea of red ink, Solyndra’s panicked backers pleaded with the administration to restructure the loan terms — to insulate them from their poor business judgment, allowing them to recoup some of their investment while the public took the fall.
It should go without saying that the duty of soi-disant public servants is to serve the public. In this instance, the proper course was clear. As structured, the loan gave the public first dibs on Solyndra’s assets if it collapsed, and, as we’ve seen, the law requires it. There was no good reason to contemplate a change.
In addition, as Andrew Stiles relates, OMB had figured out that there was no economic sense in restructuring: Solyndra was heading for bankruptcy anyway, and an immediate liquidation would net the government a better deal — about $170 million better. The case for leaving things where they stood was so palpable that OMB openly feared “questions will be asked” if DOE proceeded with an unjustifiable restructuring. So, with numbing predictability, the Obama administration proceeded with an unjustifiable restructuring. In exchange for lending some of their own money and thus buying more time, Solyndra officials were given priority over taxpayers with respect to the first $75 million in the event of a bankruptcy — the event all the insiders and government officials could see coming from the start, and that hit the rest of us like a $535 billion thunderbolt last week.
The administration’s rationalization is priceless. According to DOE officials, the restructuring was necessary “to create a situation whereby investors felt there was a value in their investment.” Of course, the value in an investment is the value created by the business in which the investment is made. Here, Solyndra had no value. Investors could be enticed only by an invalid arrangement to recoup some of their losses — by a scheme to make the public an even bigger sap.
The word for such schemes is fraud.
— Andrew C. McCarthy, a senior fellow at the National Review Institute, is the author, most recently, of The Grand Jihad: How Islam and the Left Sabotage America.
[See also: Obama’s 'Crony-Gate' Scandal Widens — Billions Now Under Scrutiny]
The Solyndra Fraud
By Andrew McCarthy, NRO
The solar-energy company was a con game.
The Solyndra debacle is not just Obama-style crony socialism as usual. It is a criminal fraud. That is the theory that would be guiding any competent prosecutor’s office in the investigation of a scheme that cost victims — in this case, American taxpayers — a fortune.
Fraud against the United States is one of the most serious felony offenses in the federal penal law. It is even more serious than another apparent Solyndra violation that has captured congressional attention: the Obama administration’s flouting of a statute designed to protect taxpayers.
Homing in on one of the several shocking aspects of the Solyndra scandal, lawmakers noted that, a few months before the “clean energy” enterprise went belly-up last week, the Obama Energy Department signed off on a sweetheart deal. In the event of bankruptcy — the destination to which it was screamingly obvious Solyndra was headed despite the president’s injection of $535 million in federal loans — the cozily connected private investors would be given priority over American taxpayers. In other words, when the busted company’s assets were sold off, Obama pals would recoup some of their losses, while you would be left holding the half-billion-dollar bag.
As Andrew Stiles reported here at NRO, Republicans on the Oversight and Investigations subcommittee say this arrangement ran afoul of the Energy Policy Act of 2005. This law — compassionate conservatism in green bunting — is a monstrosity, under which Leviathan, which can’t run a post office, uses your money to pick winners and losers in the economy’s energy sector. The idea is cockamamie, but Congress did at least write in a mandate that taxpayers who fund these “investments” must be prioritized over other stakeholders. The idea is to prevent cronies from pushing ahead of the public if things go awry — as they are wont to do when pols fancy themselves venture capitalists.
On the Energy Policy Act, the administration’s malfeasance is significant, but secondary. That’s because the act is not a penal statute. It tells the cabinet officials how to structure these “innovative technology” loans, but it provides no remedy if Congress’s directives are ignored.
The criminal law, by contrast, is not content to assume the good faith of government officials. It targets anyone — from low-level swindlers to top elective officeholders — who attempts to influence the issuance of government loans by making false statements; who engages in schemes to defraud the United States; or who conspires “to defraud the United States, or any agency thereof, in any manner or for any purpose.” The penalties are steep: Fraud in connection with government loans, for example, can be punished by up to 30 years in the slammer.
Although Solyndra was a private company, moreover, it was using its government loans as a springboard to go public. When the sale of securities is involved, federal law criminalizes fraudulent schemes, false statements of material fact, and statements that omit any “material fact necessary in order to make the statements made . . . not misleading.” And we’re not just talking about statements made in required SEC filings. Any statement made to deceive the market can be actionable. In 2003, for example, the Justice Department famously charged Martha Stewart with securities fraud. Among other allegations, prosecutors cited public statements she had made in press releases and at a conference for securities analysts — statements in which she withheld damaging information in an effort to inflate the value of her corporation and its stock.
That’s exactly what President Obama did on May 26, 2010, with his Solyndra friends about to launch their initial public offering of stock. The solar-panel company’s California factory was selected as the fitting site for a presidential speech on the virtues of confiscating taxpayer billions to prop up pie-in-the-sky clean-energy businesses.
By then, the con game was already well under way. Solyndra had first tried to get Energy Act funding during the Bush administration, but had been rebuffed shortly before President Bush left office. Small wonder: Solyndra, as former hedge-fund manager Bruce Krasting concluded, was “an absolute complete disaster.” Its operating expenses, including supply costs, nearly doubled its revenue in 2009 — and that’s without factoring in capital expenditures and other costs in what, Krasting observes, is a “low margin” industry. The chance that Solyndra would ever become profitable was essentially nonexistent, particularly given that solar-panel competitors backed by China produce energy at drastically lower prices.
Yet, as Stiles reports, within six days of Obama’s taking office, an Energy Department official acknowledged that the Solyndra “approval process” was suddenly being considered anew. Eventually, the administration made Solyndra the very first recipient of a public loan guarantee when the Energy Act program was beefed up in 2009 — just part of nearly a trillion dollars burned through under the Obama stimulus.
For a while after Solyndra tanked, the administration stonewalled the House subcommittee’s investigation, but we now know that minions in the Energy Department and the Office of Management and Budget had enormous qualms about the Solyndra loan. They realized that the company was hemorrhaging money and, even with the loan, would lack the necessary working capital to turn that equation around. Yet they caved under White House pressure to sign off in time for Vice President Joe Biden to make a ballyhooed announcement of the loan in September 2009. An OMB e-mail laments that the timing of the loan approval was driven by the politics of the announcement “rather than the other way around.”
Why so much pressure to give half a billion dollars to a doomed venture? The administration insists it had nothing whatsoever to do with the fact that Solyndra’s big backers include the George Kaiser Family Foundation. No, of course not. George Kaiser, an Oklahoma oil magnate, just happens to be a major Obama fundraiser who bundled oodles in contributions for the president’s 2008 campaign. Solyndra officers and investors are said to have visited the White House no fewer than 20 times while the loan guarantee was being considered and, later, revised. Kaiser, too, made several visits — but not to worry: Both he and administration officials deny any impropriety. You’re to believe that the White House was just turning up the heat on OMB and DOE because Solyndra seemed like such a swell investment.
Except it didn’t seem so swell to people who knew how to add and subtract, and those people weren’t all at OMB and DOE. Flush with confidence that their mega-loan from Uncle Sam would make the company attractive to private investors, Solyndra’s backers prepared to take the company public. Unfortunately, SEC rules for an initial public offering of stock require the disclosure of more than Obama speeches glowing with solar power. Companies that want access to the market have to reveal their financial condition.
In Solyndra’s case, outside auditors from PricewaterhouseCoopers (PWC) found that condition to be dire. “The company has suffered recurring losses from operations, negative cash flows since inception, and has a net stockholders’ deficit,” the PWC accountants concluded. Even with the gigantic Obama loan, Solyndra was such a basket case that PWC found “substantial doubt about its ability to continue as a going concern.”
The “going concern” language is not boilerplate. As Townhall finance maven John Ransom explains, it is a term of art to which auditors resort when there is an extraordinary need to protect themselves and the company from legal liability. Angry investors who’ve lost their shirts tend to scapegoat the loser company’s accountants. In truth, even if the accountants affixed a neon “going concern” sign to the company’s financial statements, investors would have no one but themselves to blame. But it is unusual: The language is absent from the statements of many companies that actually end up going bankrupt. Auditors reserve it for the hopeless causes — like Solyndra.
With no alternative if they wanted to make a play for market financing, Solyndra’s backers disclosed the auditors’ bleak diagnosis in March 2010. The government had thus been aware of it for two months when President Obama made his May 26 Solyndra speech — the speech Solyndra backers were clearly hoping would mitigate the damage.
As president, Obama had a fiduciary responsibility to be forthright about Solyndra’s grim prospects — in speaking to the American taxpayers whose money he had redistributed, and to the American investors who were about to be solicited for even more funding. Instead, he pulled a Martha Stewart.
The president looked us in the eye and averred that, when it came to channeling public funds into private hands, “We can see the positive impacts right here at Solyndra.” He bragged that the $535 billion loan had enabled the company to build the state-of-the-art factory in which he was then speaking. He said nothing about how Solyndra was continuing to lose money — public money — at a catastrophic pace. Instead, he painted the brightest of pictures: 3,000 construction workers to build the thriving plant; manufacturers in 22 states building an endless stream of supplies; technicians in a dozen states constructing the advanced equipment that would make the factory hum; and Solyndra fully “expect[ing] to hire a thousand workers to manufacture solar panels and sell them across America and around the world.”
Not content with that rosy portrait, the president further predicted a “ripple effect”: Solyndra would “generate business for companies throughout our country who will create jobs supplying this factory with parts and materials.” Sure it would. The auditors had scrutinized Solyndra and found it to have, from its inception, a fatally flawed business model that was hurtling toward collapse. Obama touted it as a redistribution success story that would be rippling jobs, growth, and spectacular success for the foreseeable future.
It was a breathtaking misrepresentation. Happily, it proved insufficient to dupe investors who, unlike taxpayers, get to choose where their money goes. They stacked what the administration was saying against what the PWC auditors were saying and wisely went with PWC. Solyndra had to pull its initial public offering due to lack of interest.
But fraud doesn’t have to be fully successful to be a fraud, and this one still had another chapter to go. As the IPO failed and the company inevitably sank in a sea of red ink, Solyndra’s panicked backers pleaded with the administration to restructure the loan terms — to insulate them from their poor business judgment, allowing them to recoup some of their investment while the public took the fall.
It should go without saying that the duty of soi-disant public servants is to serve the public. In this instance, the proper course was clear. As structured, the loan gave the public first dibs on Solyndra’s assets if it collapsed, and, as we’ve seen, the law requires it. There was no good reason to contemplate a change.
In addition, as Andrew Stiles relates, OMB had figured out that there was no economic sense in restructuring: Solyndra was heading for bankruptcy anyway, and an immediate liquidation would net the government a better deal — about $170 million better. The case for leaving things where they stood was so palpable that OMB openly feared “questions will be asked” if DOE proceeded with an unjustifiable restructuring. So, with numbing predictability, the Obama administration proceeded with an unjustifiable restructuring. In exchange for lending some of their own money and thus buying more time, Solyndra officials were given priority over taxpayers with respect to the first $75 million in the event of a bankruptcy — the event all the insiders and government officials could see coming from the start, and that hit the rest of us like a $535 billion thunderbolt last week.
The administration’s rationalization is priceless. According to DOE officials, the restructuring was necessary “to create a situation whereby investors felt there was a value in their investment.” Of course, the value in an investment is the value created by the business in which the investment is made. Here, Solyndra had no value. Investors could be enticed only by an invalid arrangement to recoup some of their losses — by a scheme to make the public an even bigger sap.
The word for such schemes is fraud.
— Andrew C. McCarthy, a senior fellow at the National Review Institute, is the author, most recently, of The Grand Jihad: How Islam and the Left Sabotage America.
Wednesday, September 14, 2011
Saddam and WMD:President Bush did not lie
Saddam: What We Now Know
Bin Laden struck first, but Saddam was at least as big a terror threat.
Saddam Hussein was a WMD threat and a terror threat to the United States and its allies.
Too many of the post-9/11 critics have forgotten or were never aware of this fact. Even in last week’s NRO symposium, writers called the invasion of Iraq an “unjust war,” an “optional war,” and finally a “result of the flawed intelligence that skewed the perceived threat posed by Saddam Hussein’s regime to the United States.”
There is little doubt that the pre-war intelligence on Iraq was faulty, mostly because of Saddam’s continuing attempts to convince Iran that he still maintained a potent WMD capacity despite years of sanctions. Unfortunately, in the years of recriminations following the invasion of Iraq the actual truth was lost, until it became commonplace for even those who supported the invasion to admit that Saddam did not pose a WMD threat. Likewise, as he was not responsible for the 9/11 attacks, many believe he was not a terror threat either.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
ADVERTISEMENT
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Before the consensus is written in stone, it is worth going over the evidence collected since the removal of the Saddam regime. Leaving aside the fact that he slaughtered more than a million of his own people and was prone to launching unprovoked wars against his neighbors — both good reasons for his violent removal — what threat did Saddam actually pose? Let’s go through just a sliver of the evidence.
SADDAM AND WMDS
When American tanks smashed into Baghdad, Saddam had already completed construction of an anthrax production facility, which was a week away from going live. If it had been permitted to go into production, this one facility could have produced ten tons of weaponized anthrax a year. Experts estimate that anthrax spores that infect the skin will kill 50 percent of untreated victims. Inhaled anthrax will kill 100 percent of untreated victims and 50 percent of those receiving immediate treatment. That means that a mere 1 percent of Saddam’s annual production (200 pounds) sprayed by crop-duster over New York City would have killed upwards of three million people.
Anthrax, however, was far from the only WMD Saddam was actively researching and working assiduously to acquire. He also had teams working overtime to create a stockpile of some of the most deadly biological weapons possible. Several years ago, the press had a field day when two suspected mobile bio-labs, presented at the U.N. as evidence of Saddam’s continuing WMD development programs, actually turned out to be weather-balloon stations. That same press, however, then ignored the fact that postwar investigators found five actual mobile bio-labs in and around Baghdad. One of these labs was discovered in a mosque, which had been placed off-limits to prewar U.N. inspectors. Another was found in Baghdad’s Central Public Health Laboratory. One can imagine the anguished cries from the Left if we had bombed what the Iraqis claimed was a public-health facility. Saddam even had a huge bio-warfare production facility masquerading as the Samarra Drug Company. This facility would have been capable of producing up to 10,000 liters of deadly pathogens a year. It was less than a month from going into production when the invasion of Iraq began. If this plant had turned its attention to botulinum toxin, it could have produced enough in a few months to wipe out the world. Again, how would bombing a plant that Saddam would claim was producing life-saving drugs have played in the media?
Investigators also found two labs that appeared to be producing animal vaccines. However, according to investigators, all of the equipment was “dual use . . . and easily diverted to produce smallpox or other pathogenic viruses.” Another nearby lab was busily working on cowpox vaccines, with the exact same equipment necessary to create smallpox. One should note that even a thimbleful of smallpox germs would be enough to kill tens of millions. Smallpox, placed in the hands of a terrorist group and released at a sporting event, would devastate a large swath of the United States. It should be noted that each of these facilities was staffed or often visited by persons previously identified by the U.N. as being associated with Saddam’s pre–Desert Storm WMD programs. One facility, often visited by Dr. Rihab Rashid Taha al-Azawi, better known to Western intelligence as Dr. Germ, maintained, according to investigators, a “small” capacity for production of organic agents. When it comes to smallpox, a “small” capacity is all one needs to create global havoc.
Biological weapons were an important and dangerous thrust of Saddam’s WMD program, but far from all that his regime was working on. In 1991, Saddam moved all of his WMD specialists out of government labs and into universities, once again making them off-limits to inspectors and coalition bombers. According to documents discovered after the war, by 1997 the number of university “instructors” doing solely WMD work numbered 3,300, with another 700 to 800 dispatched to WMD-related facilities to help with technical problems. Between 1996 and 2002 — the eve of the invasion — spending on WMD projects increased 40-fold, and the number of specific projects increased from 40 to 3,200. Top officials captured after the collapse of the regime repeatedly told investigators that Saddam’s WMD projects were in overdrive and ready to go into production the moment sanctions were lifted.
Saddam’s minister of military industrialization, Abdullah Mullah al-Huwaysh, stated that Saddam was working to reconstruct all of his WMD programs within five years. In his words, this would have included “a sizable nuclear inventory on hand for immediate use.” Huwaysh also stated that in response to a Saddam inquiry regarding how long it would take to start mass production of chemical weapons, he told the tyrant that mustard-gas production could start within six months, but Sarin and VX would take a bit longer. Other WMD scientists told investigators that they had the materials and equipment to start mustard-gas production in days.
Inevitably, a relaxation of some of the sanctions led Saddam to start thinking again about nuclear weapons. In 1999 he met with his senior nuclear scientists and offered to provide them with whatever they needed, and immediately thereafter new funds began to flow to the Iraqi Atomic Energy Commission (IAEC). In 2001, Saddam directed a large budget increase for the IAEC and increased the salaries of nuclear scientists ten-fold. He also directed the head of the IAEC to keep nuclear scientists together, and instituted new laws and privileges for IAEC scientists, while also investing in numerous new projects. From 2001 on, Saddam convened frequent meetings with the IAEC to highlight new achievements.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
ADVERTISEMENT
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Although Saddam did not possess huge stocks of WMD material when we invaded, he was well on his way to creating an arsenal potent enough to decimate any attacking force. If we had delayed even a couple of months, until Saddam actually had his deadly pathogens and gas weapons, it would have meant the deaths of tens of thousands of American soldiers. And if those weapons had found their way into terrorist hands, it would have doomed millions. But did Saddam have these kinds of connections? Was he a global terror threat akin to al-Qaeda? The common wisdom says no. The common wisdom is wrong.
SADDAM AND TERROR
In 1999, the top ten graduates of Saddam’s Fedayeen Academy (terrorist training center) were specifically chosen for assignment to London. Once there they were held in readiness for operations anywhere in Europe. A memorandum addressed to Saddam’s son Uday specifically states that these trainees were designated for martyrdom operations. In the same memorandum, outlining “Operation Blessed July,” Uday is briefed on plans for terrorists to be sent to Great Britain and other countries, to begin a campaign of assassinations and bombings. Interestingly, the report states that any Fedayeen terrorists operating in Europe will be provided with “death capsules” for their personal use in case of capture. Besides selecting and training these potential terrorists, the Saddam regime also undertook substantial logistical preparations. A glimpse of these preparations can be seen in the response Saddam received from his intelligence services when he inquired about what weapons were available to arm terrorists in Iraqi embassies. Here is part of the tally:
Romania: Missile launcher and missile
Athens [Greece]: Explosive charges
Vienna [Austria]: Explosive charges, rifles with silencers, hand grenades, and Kalashnikov rifles
Pakistan: Explosive materials (TNT)
India: Plastic-explosive charges and booby-trapped suitcases
Thailand: Plastic-explosive charges and booby-trapped suitcases
Prague [Czech Republic]: Missile launcher and missile
Turkey: Missile launcher, missile, and pistols with silencers
Sana’a [Yemen]: Missile launcher, missile, plastic explosives, and explosive charges
Baku [Azerbaijan]: American missile launcher, plastic explosives, and booby-trapped suitcases
Beirut [Lebanon]: American missile launcher, plastic explosives, and booby-trapped suitcases
Gulf nations: Explosive material outside the embassies
The memo further states that between 2000 and 2002, explosive materials were transported to many embassies outside of Iraq for “special work.”
Realizing the value of suicide bombers, the regime’s intelligence services, a week after 9/11, sent a letter to Saddam outlining the steps they had taken to recruit bombers: “Division Commands have launched a campaign among their members, supporters, and backers of the Party encouraging them to volunteer in suicide operations, and have them write volunteer statements, preferably in their own blood.” The rest of the memo is a list of the 42 persons who had already signed on to blow themselves up whenever and wherever Saddam wished. The selection and training of suicide bombers became so routine that the regime started scheduling training sessions around the volunteers’ vacation periods from university.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
ADVERTISEMENT
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
An example of a successful suicide operation is documented in a letter that Fedayeen Saddam headquarters forwarded to Uday Hussein. A woman called Nazah asks for his help in processing her husband’s pension documents. She claims the request is justified because her husband died when “he carried out a suicide mission on 19 July 2000, and exploded himself at the Ibn Sina Hotel during the presence of U.S. and U.K. citizens and officials from Iraqi opposition parties.” She goes on to list some of his other activities that would justify a pension for his family:
Booby-trapped a car in front of the Kurdish Communist Party Headquarters
Detonated a car bomb during the motorcade of Danielle Mitterrand (wife of French president François Mitterrand) in Halsabajah City, which killed 40 enemies
Poisoned opposition-party members on the orders of the intelligence services
Saddam was also a sponsor of state terrorism on a truly impressive scale. One document sent to Saddam lists all the major terrorist groups that his intelligence services are in contact with, how long they have been in the Iraqi fold, and approximately how much support they have received. Most of these organizations also appear on the list of al-Qaeda–linked terrorist groups. Saddam and bin Laden may have loathed each other, but they found common cause in financially supporting, arming, and helping to train groups that are part of the same global terrorist network. One note sent to Saddam presented an account of how many foreign terrorists were currently training in Iraqi centers.
Palestine 38 Egypt 4
Lebanon 10 Libya 1
Tunisia 8 Sudan 18
Syria 10 Eritrea 7
Morocco 3 Unknown 1
In fact, after his 1991 defeat in Operation Desert Storm, Saddam ordered his intelligence services to maintain contact with all terrorist movements in the Arab countries. Captured documents reveal that intelligence-service activities went beyond just maintaining contact. One set of details appears in a report written six weeks after 9/11. It states that Iraq was sending an administrative officer to establish and oversee a terrorist training camp, and lists the equipment being dispatched in the first set of supplies:
15,000 Kalashnikov 7.62-mm rifles
15,000 [SKS] rifles
5,000 Browning pistols
5,000 Markarov pistols
1 high-quality photocopier
The memorandum ends with the names of 52 fighters waiting for training in the camp.
Evidence of Saddam’s continuing interest in and support for global terrorist activities is found in a 2002 annual report of one of the directorates within his intelligence service. It states that, in the year after 9/11, it held 13 meetings for a number of Palestinian and other organizations, including delegations from the Islamic Jihad Movement and the director general of the Popular Movement for the Liberation of al-Ahwaz (al-Ahwaz is a portion of Iran inhabited largely by Arabs). The list then details the messages various terrorist groups sent to Saddam during the year. The titles of the messages range from simple best wishes on Saddam’s birthday to the following:
Information on the number of Palestinian martyrs killed vs. Zionists killed
Requests for military equipment and for help for the families of suicide bombers
Information on the financial status of various terrorist organizations, volunteers for suicide operations, and rumors of a plan to assassinate Saddam Hussein
The report also notes that among the 699 passports that the intelligence services issued, many were issued to known members of terrorist organizations. Moreover, it states that the intelligence services took four million dinars from their own budgets to finance Palestinian terrorist groups.
The report also provides a list of activities the intelligence services considered “exemplary events,” for example:
Re-equipping and training Palestinian fighters in al-Quds training camps [in Iraq]
Establishing and activating a course to train Arab Liberation Front fighters on martyrdom operations
Establishing fighter schools for Arab volunteers and later for Iraqi volunteers
Re-establishing and re-equipping the military base of the Arab Liberation Front
Training groups from the occupied territories [Palestine] on light weapons in secret 30-day courses
All of this is just the tip of the iceberg of available evidence demonstrating that Saddam posed a dangerous threat to America. There are other reports providing specific information on dozens of terrorist attacks, as well as details of how Iraq helped plan and execute many of them. Moreover, there is also proof of Saddam’s support of Islamic groups that were part of the al-Qaeda network. A good analogy for the links between Saddam and bin Laden is the Cali and Medellín drug cartels. Both drug cartels (actually loose collections of families and criminal gangs) were serious national-security concerns to the United States. The two cartels competed for a share of the illegal drug market. However, neither cartel was reluctant to cooperate with the other when it came to the pursuit of a common objective — expanding and facilitating their illicit trade. The well-publicized and violent rise of the Medellín cartel temporarily obscured and overshadowed the rise of, and threat posed by, the Cali cartel, in the same way that 9/11 camouflaged the terror threat posed by Saddam. In reality Saddam and bin Laden were operating parallel terror networks aimed at the United States. Bin Laden just has the distinction of having made the first horrendous attack.
Given the evidence, it appears that we removed Saddam’s regime not a moment too soon.
— Jim Lacey is the author of The First Clash and Keep from All Thoughtful Men.
Bin Laden struck first, but Saddam was at least as big a terror threat.
Saddam Hussein was a WMD threat and a terror threat to the United States and its allies.
Too many of the post-9/11 critics have forgotten or were never aware of this fact. Even in last week’s NRO symposium, writers called the invasion of Iraq an “unjust war,” an “optional war,” and finally a “result of the flawed intelligence that skewed the perceived threat posed by Saddam Hussein’s regime to the United States.”
There is little doubt that the pre-war intelligence on Iraq was faulty, mostly because of Saddam’s continuing attempts to convince Iran that he still maintained a potent WMD capacity despite years of sanctions. Unfortunately, in the years of recriminations following the invasion of Iraq the actual truth was lost, until it became commonplace for even those who supported the invasion to admit that Saddam did not pose a WMD threat. Likewise, as he was not responsible for the 9/11 attacks, many believe he was not a terror threat either.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
ADVERTISEMENT
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Before the consensus is written in stone, it is worth going over the evidence collected since the removal of the Saddam regime. Leaving aside the fact that he slaughtered more than a million of his own people and was prone to launching unprovoked wars against his neighbors — both good reasons for his violent removal — what threat did Saddam actually pose? Let’s go through just a sliver of the evidence.
SADDAM AND WMDS
When American tanks smashed into Baghdad, Saddam had already completed construction of an anthrax production facility, which was a week away from going live. If it had been permitted to go into production, this one facility could have produced ten tons of weaponized anthrax a year. Experts estimate that anthrax spores that infect the skin will kill 50 percent of untreated victims. Inhaled anthrax will kill 100 percent of untreated victims and 50 percent of those receiving immediate treatment. That means that a mere 1 percent of Saddam’s annual production (200 pounds) sprayed by crop-duster over New York City would have killed upwards of three million people.
Anthrax, however, was far from the only WMD Saddam was actively researching and working assiduously to acquire. He also had teams working overtime to create a stockpile of some of the most deadly biological weapons possible. Several years ago, the press had a field day when two suspected mobile bio-labs, presented at the U.N. as evidence of Saddam’s continuing WMD development programs, actually turned out to be weather-balloon stations. That same press, however, then ignored the fact that postwar investigators found five actual mobile bio-labs in and around Baghdad. One of these labs was discovered in a mosque, which had been placed off-limits to prewar U.N. inspectors. Another was found in Baghdad’s Central Public Health Laboratory. One can imagine the anguished cries from the Left if we had bombed what the Iraqis claimed was a public-health facility. Saddam even had a huge bio-warfare production facility masquerading as the Samarra Drug Company. This facility would have been capable of producing up to 10,000 liters of deadly pathogens a year. It was less than a month from going into production when the invasion of Iraq began. If this plant had turned its attention to botulinum toxin, it could have produced enough in a few months to wipe out the world. Again, how would bombing a plant that Saddam would claim was producing life-saving drugs have played in the media?
Investigators also found two labs that appeared to be producing animal vaccines. However, according to investigators, all of the equipment was “dual use . . . and easily diverted to produce smallpox or other pathogenic viruses.” Another nearby lab was busily working on cowpox vaccines, with the exact same equipment necessary to create smallpox. One should note that even a thimbleful of smallpox germs would be enough to kill tens of millions. Smallpox, placed in the hands of a terrorist group and released at a sporting event, would devastate a large swath of the United States. It should be noted that each of these facilities was staffed or often visited by persons previously identified by the U.N. as being associated with Saddam’s pre–Desert Storm WMD programs. One facility, often visited by Dr. Rihab Rashid Taha al-Azawi, better known to Western intelligence as Dr. Germ, maintained, according to investigators, a “small” capacity for production of organic agents. When it comes to smallpox, a “small” capacity is all one needs to create global havoc.
Biological weapons were an important and dangerous thrust of Saddam’s WMD program, but far from all that his regime was working on. In 1991, Saddam moved all of his WMD specialists out of government labs and into universities, once again making them off-limits to inspectors and coalition bombers. According to documents discovered after the war, by 1997 the number of university “instructors” doing solely WMD work numbered 3,300, with another 700 to 800 dispatched to WMD-related facilities to help with technical problems. Between 1996 and 2002 — the eve of the invasion — spending on WMD projects increased 40-fold, and the number of specific projects increased from 40 to 3,200. Top officials captured after the collapse of the regime repeatedly told investigators that Saddam’s WMD projects were in overdrive and ready to go into production the moment sanctions were lifted.
Saddam’s minister of military industrialization, Abdullah Mullah al-Huwaysh, stated that Saddam was working to reconstruct all of his WMD programs within five years. In his words, this would have included “a sizable nuclear inventory on hand for immediate use.” Huwaysh also stated that in response to a Saddam inquiry regarding how long it would take to start mass production of chemical weapons, he told the tyrant that mustard-gas production could start within six months, but Sarin and VX would take a bit longer. Other WMD scientists told investigators that they had the materials and equipment to start mustard-gas production in days.
Inevitably, a relaxation of some of the sanctions led Saddam to start thinking again about nuclear weapons. In 1999 he met with his senior nuclear scientists and offered to provide them with whatever they needed, and immediately thereafter new funds began to flow to the Iraqi Atomic Energy Commission (IAEC). In 2001, Saddam directed a large budget increase for the IAEC and increased the salaries of nuclear scientists ten-fold. He also directed the head of the IAEC to keep nuclear scientists together, and instituted new laws and privileges for IAEC scientists, while also investing in numerous new projects. From 2001 on, Saddam convened frequent meetings with the IAEC to highlight new achievements.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
ADVERTISEMENT
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Although Saddam did not possess huge stocks of WMD material when we invaded, he was well on his way to creating an arsenal potent enough to decimate any attacking force. If we had delayed even a couple of months, until Saddam actually had his deadly pathogens and gas weapons, it would have meant the deaths of tens of thousands of American soldiers. And if those weapons had found their way into terrorist hands, it would have doomed millions. But did Saddam have these kinds of connections? Was he a global terror threat akin to al-Qaeda? The common wisdom says no. The common wisdom is wrong.
SADDAM AND TERROR
In 1999, the top ten graduates of Saddam’s Fedayeen Academy (terrorist training center) were specifically chosen for assignment to London. Once there they were held in readiness for operations anywhere in Europe. A memorandum addressed to Saddam’s son Uday specifically states that these trainees were designated for martyrdom operations. In the same memorandum, outlining “Operation Blessed July,” Uday is briefed on plans for terrorists to be sent to Great Britain and other countries, to begin a campaign of assassinations and bombings. Interestingly, the report states that any Fedayeen terrorists operating in Europe will be provided with “death capsules” for their personal use in case of capture. Besides selecting and training these potential terrorists, the Saddam regime also undertook substantial logistical preparations. A glimpse of these preparations can be seen in the response Saddam received from his intelligence services when he inquired about what weapons were available to arm terrorists in Iraqi embassies. Here is part of the tally:
Romania: Missile launcher and missile
Athens [Greece]: Explosive charges
Vienna [Austria]: Explosive charges, rifles with silencers, hand grenades, and Kalashnikov rifles
Pakistan: Explosive materials (TNT)
India: Plastic-explosive charges and booby-trapped suitcases
Thailand: Plastic-explosive charges and booby-trapped suitcases
Prague [Czech Republic]: Missile launcher and missile
Turkey: Missile launcher, missile, and pistols with silencers
Sana’a [Yemen]: Missile launcher, missile, plastic explosives, and explosive charges
Baku [Azerbaijan]: American missile launcher, plastic explosives, and booby-trapped suitcases
Beirut [Lebanon]: American missile launcher, plastic explosives, and booby-trapped suitcases
Gulf nations: Explosive material outside the embassies
The memo further states that between 2000 and 2002, explosive materials were transported to many embassies outside of Iraq for “special work.”
Realizing the value of suicide bombers, the regime’s intelligence services, a week after 9/11, sent a letter to Saddam outlining the steps they had taken to recruit bombers: “Division Commands have launched a campaign among their members, supporters, and backers of the Party encouraging them to volunteer in suicide operations, and have them write volunteer statements, preferably in their own blood.” The rest of the memo is a list of the 42 persons who had already signed on to blow themselves up whenever and wherever Saddam wished. The selection and training of suicide bombers became so routine that the regime started scheduling training sessions around the volunteers’ vacation periods from university.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
ADVERTISEMENT
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
An example of a successful suicide operation is documented in a letter that Fedayeen Saddam headquarters forwarded to Uday Hussein. A woman called Nazah asks for his help in processing her husband’s pension documents. She claims the request is justified because her husband died when “he carried out a suicide mission on 19 July 2000, and exploded himself at the Ibn Sina Hotel during the presence of U.S. and U.K. citizens and officials from Iraqi opposition parties.” She goes on to list some of his other activities that would justify a pension for his family:
Booby-trapped a car in front of the Kurdish Communist Party Headquarters
Detonated a car bomb during the motorcade of Danielle Mitterrand (wife of French president François Mitterrand) in Halsabajah City, which killed 40 enemies
Poisoned opposition-party members on the orders of the intelligence services
Saddam was also a sponsor of state terrorism on a truly impressive scale. One document sent to Saddam lists all the major terrorist groups that his intelligence services are in contact with, how long they have been in the Iraqi fold, and approximately how much support they have received. Most of these organizations also appear on the list of al-Qaeda–linked terrorist groups. Saddam and bin Laden may have loathed each other, but they found common cause in financially supporting, arming, and helping to train groups that are part of the same global terrorist network. One note sent to Saddam presented an account of how many foreign terrorists were currently training in Iraqi centers.
Palestine 38 Egypt 4
Lebanon 10 Libya 1
Tunisia 8 Sudan 18
Syria 10 Eritrea 7
Morocco 3 Unknown 1
In fact, after his 1991 defeat in Operation Desert Storm, Saddam ordered his intelligence services to maintain contact with all terrorist movements in the Arab countries. Captured documents reveal that intelligence-service activities went beyond just maintaining contact. One set of details appears in a report written six weeks after 9/11. It states that Iraq was sending an administrative officer to establish and oversee a terrorist training camp, and lists the equipment being dispatched in the first set of supplies:
15,000 Kalashnikov 7.62-mm rifles
15,000 [SKS] rifles
5,000 Browning pistols
5,000 Markarov pistols
1 high-quality photocopier
The memorandum ends with the names of 52 fighters waiting for training in the camp.
Evidence of Saddam’s continuing interest in and support for global terrorist activities is found in a 2002 annual report of one of the directorates within his intelligence service. It states that, in the year after 9/11, it held 13 meetings for a number of Palestinian and other organizations, including delegations from the Islamic Jihad Movement and the director general of the Popular Movement for the Liberation of al-Ahwaz (al-Ahwaz is a portion of Iran inhabited largely by Arabs). The list then details the messages various terrorist groups sent to Saddam during the year. The titles of the messages range from simple best wishes on Saddam’s birthday to the following:
Information on the number of Palestinian martyrs killed vs. Zionists killed
Requests for military equipment and for help for the families of suicide bombers
Information on the financial status of various terrorist organizations, volunteers for suicide operations, and rumors of a plan to assassinate Saddam Hussein
The report also notes that among the 699 passports that the intelligence services issued, many were issued to known members of terrorist organizations. Moreover, it states that the intelligence services took four million dinars from their own budgets to finance Palestinian terrorist groups.
The report also provides a list of activities the intelligence services considered “exemplary events,” for example:
Re-equipping and training Palestinian fighters in al-Quds training camps [in Iraq]
Establishing and activating a course to train Arab Liberation Front fighters on martyrdom operations
Establishing fighter schools for Arab volunteers and later for Iraqi volunteers
Re-establishing and re-equipping the military base of the Arab Liberation Front
Training groups from the occupied territories [Palestine] on light weapons in secret 30-day courses
All of this is just the tip of the iceberg of available evidence demonstrating that Saddam posed a dangerous threat to America. There are other reports providing specific information on dozens of terrorist attacks, as well as details of how Iraq helped plan and execute many of them. Moreover, there is also proof of Saddam’s support of Islamic groups that were part of the al-Qaeda network. A good analogy for the links between Saddam and bin Laden is the Cali and Medellín drug cartels. Both drug cartels (actually loose collections of families and criminal gangs) were serious national-security concerns to the United States. The two cartels competed for a share of the illegal drug market. However, neither cartel was reluctant to cooperate with the other when it came to the pursuit of a common objective — expanding and facilitating their illicit trade. The well-publicized and violent rise of the Medellín cartel temporarily obscured and overshadowed the rise of, and threat posed by, the Cali cartel, in the same way that 9/11 camouflaged the terror threat posed by Saddam. In reality Saddam and bin Laden were operating parallel terror networks aimed at the United States. Bin Laden just has the distinction of having made the first horrendous attack.
Given the evidence, it appears that we removed Saddam’s regime not a moment too soon.
— Jim Lacey is the author of The First Clash and Keep from All Thoughtful Men.
Monday, September 12, 2011
Obama is offended
Steve Bridges is the guy who imitated George Bush on the Jay Leno Show. He has now started imitating Obama and REALLY does it well. The Administration has tried to put a stop to Bridges’ act because Obama has made it known that he is deeply offended. So do your part to keep the Spender-In-Chief “deeply offended” by passing this around… there might also be some educational content.
Subscribe to:
Posts (Atom)