Culture of Corruption: Obama and His Team of Tax Cheats, Crooks, and Cronies (7 page)

RAILROADING THE AMTRAK INSPECTOR GENERAL

On June 18, 2009—just one week after the White House demanded Walpin’s head—Amtrak’s longtime inspector general, Fred Weiderhold Jr., abruptly retired without notice or explanation. Weiderhold’s retirement came the same day he met with Amtrak officials to discuss the results of an independent report by the Washington, D.C., law firm Willkie, Farr & Gallagher.

The report—subsequently made available to the public by Senator Grassley—concluded that the “independence and effectiveness” of the Amtrak inspector general’s office “are being substantially impaired” by the agency’s Law Department. Amtrak bosses effectively gagged their budgetary watchdogs from communicating with Congress without preapproval; required that all Amtrak documents be “pre-screened” (and in some cases redacted) before being turned over to the inspector general’s office; and took control over the IG’s $5 million portion of federal stimulus dollars.
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Moreover, the report revealed, Amtrak management regularly retained outside law firms shielded from IG reach. In another case, Amtrak’s Law Department appeared to meddle in an inspector general investigation of an outside financial adviser suspected of inflating fees. The consultant ran to the Law Department when the IG demanded documents; the Law Department repudiated the IG’s instructions on complying with a subpoena.
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These interventions (ongoing since 2007) “systematically violated the letter and spirit of the Inspector General Act,” according to Senator Grassley.

Democrat Congressman Edolphus Towns of New York and Darrell Issa, the chairman and ranking member of the House Oversight and Government Reform Committee, respectively, launched an investigation .
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Amtrak asserts that “there was no relationship between the timing of Mr. Weiderhold’s retirement and [the Willkie, Farr & Gallagher] report.”
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Just another coincidence!

STONEWALLING THE SIGTARP

Neil Barofsky is the Special Inspector General for the Troubled Asset Relief Program (SIGTARP). His job is to oversee hundreds of billions of dollars of federal funds spent on bailout programs.

In the spring of 2009, some members of Congress were angry about large bonuses paid to executives at bailout-recipient American International Group. Hapless Treasury Secretary Tim Geithner didn’t help matters when he gave Congress incorrect information about when he first heard about the AIG bonus issue.
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In response to requests from lawmakers, Barofsky announced he would audit the bonuses. But when he went to the Treasury Department to get the relevant documents, Treasury officials “initially refused to provide them,” according to Matt Jaffe of ABC News.
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For good measure, Treasury officials then asked the Justice Department’s Office of Legal Counsel for a legal opinion indicating whether SIGTRAP was an independent entity or under the control of the Secretary of the Treasury. Jaffe reports:

In an unredacted April 7 memo released by Treasury, Barofsky, in response to an earlier Department memo, had written, “You advised that you desire OLC’s opinion about: (1) whether SIGTARP exists within the Department of the Treasury; (2) whether the Secretary of the Treasury has supervisory authority with respect to SIGTARP; and (3) assuming the answer to the first question is in the negative, whether providing Treasury’s attorney-client privileged materials to SIGTARP effectively waives the privilege.”
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THE NOT - SO - SUBTLE MESSAGE TO BAROFSKY: BACK OFF

“The grassroots is furious about the way TARP dollars have been used and what looks like a lack of accountability for this massive infusion of tax dollars,” said Senator Grassley, who advocated creating SIGTARP at the time that TARP was created. “It’s added injury to hear about the Treasury Department putting up hurdles to slow down the work of the watchdog who’s supposed to track the money.”
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Republican Congressman Jeb Hensarling of Texas, a member of the Congressional Oversight Panel, told ABC News that the Treasury Department’s effort to diminish Barofsky’s independence was “outrageous,” “unprecedented,” and “disturbing,” and called on the Panel to launch an investigation .
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“I don’t understand an administration that talks about transparency and accountability, but then one IG gets fired and the other gets gagged,” Hensarling said. “It’s unprecedented. You have to go back to the Nixon era to find a parallel.”
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Eventually, Treasury officials withdrew their request for a legal opinion, effectively conceding SIGTARP’s independence.
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GANGING UP ON A GLOBAL WARMING CRITIC

At the Environmental Protection Agency, Obama officials muzzled veteran researcher Alan Carlin, who dared to question the conventional wisdom on global warming. The economist with a physics degree was trashed as a non-scientist know-nothing after he went public about the agency’s suppression of a critical analysis he conducted on the health effects of greenhouse gases. Under non-scientist environmental czar Carol Browner (read all about her in chapter 5), the EPA barreled ahead with a health “endangerment finding” covering carbon dioxide and five other gases that will trigger costly, extensive new regulations of motor vehicles. The president had set a tight deadline and the agency was rushing to meet it. Carlin’s study didn’t fit the blame-human-activity narrative, so it didn’t make the cut.

Leaked e-mails obtained by the Washington, D.C.-based Competitive Enterprise Institute exposed how Carlin was essentially told to sit down and shut up. (Remember when President Obama declared that “the days of science taking a back seat to ideology are over?”
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Another day, another broken promise.) Carlin was forbidden from engaging in “any direct communication” with anyone outside his office about his study. “There should be no meetings, emails, written statements, phone calls, etc.,” his superior told him. After he pushed for the study to be passed up the administrative chain, he was again admonished: “The time for such discussion of fundamental issues has passed for this round. The administrator and the administration has decided to move forward on endangerment, and your comments do not help the legal or policy case for this decision.... I can only see one impact of your comments given where we are in the process, and that would be a very negative impact on our office.”
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The EPA initially justified the suppression of the study because economist Carlin (a 35-year veteran of the agency who also holds a B.S. in physics) “is an individual who is not a scientist.” Neither is Al Gore. Nor is environmental czar Carol Browner. Nor is cap-and-trade peddler Nancy Pelosi. Carlin’s analysis incorporated peer-reviewed studies and, as he informed his colleagues, “significant new research” related to the proposed endangerment finding. It spotlighted the Environmental Protection Agency’s reliance on out-of-date research, uncritical recycling of United Nations data, and omission of new developments, including a continued decline in global temperatures and a new consensus that future hurricane behavior won’t be different than in the past.
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But his superiors covered their ears: La-la-la, we can’t hear you. Funding for Carlin’s office was threatened, but he somehow hung onto his job .
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The
New York Times
later downplayed the episode
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and echoed White House talking points that it was an isolated incident.

Yet, the “isolated incidents” of dissent-stifling and hardball games kept piling up.

BUDGET WATCHDOGS, BEWARE

In January 2010, Office of Personnel Management Inspector General Patrick E. McFarland wrote a letter to Democrat Congressman Stephen Lynch of Massachusetts, the chairman of the subcommittee on Federal Workforce, Postal Service, and the District of Columbia. McFarland said that his budget office had received a “not so veiled threat” from the Office of Management and Budget (OMB) warning McFarland not to voice any concerns about his budget to Congress. According to McFarland, an OMB staffer threatened to “make life miserable for us” if McFarland’s office dared to exercise provisions in the Inspector General Act noting any financial impacts that might “substantially inhibit” the watchdog agency’s ability to do its job.
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“We take this threat of retaliation and interference to our independence very seriously,” McFarland wrote.
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An OMB investigation completed in March 2010 confirmed McFarland’s allegation .
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As Ed O’ Keefe of the
Washington Post
notes, such a threat “would violate a 2008 law [the Inspector General Reform Act of 2008] that allows federal watchdogs to inform Congress if they believe their proposed budgets would inhibit oversight duties. The law was designed to protect watchdogs from top agency officials who might slash their budgets in retaliation for hard-hitting investigations.”
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“Such communication is unacceptable at OMB,” OMB Director Peter R. Orszag said in a letter to members of the House Oversight and Government Reform Committee. Moreover, Orszag wrote, there is “no basis to believe that a systemic problem exists.”
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Tell it to Gerald Walpin, Fred Weiderhold Jr., Neil Barofsky, and Alan Carlin—and Congressional Budget Office director Douglas Elmendorf. In July 2009, President Obama spilled the beans on NBC’s
Today Show
that he had met with Congressional Budget Office (CBO) director Elmendorf—just as the number-crunchers were casting ruinous doubt on White House claims that Obama’s health care takeover proposal would save untold billions.
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Yes, question the timing. The CBO is supposed to be a neutral congressional score-keeper—not a water boy for the White House. But when the meeting failed to stop the CBO from issuing more analysis undercutting the health care savings claims, Obama’s budget director Peter Orszag played the heavy.

Orszag warned the CBO in a public letter that it had “overstepped” its bounds and risked giving the impression that it was “exaggerating costs and underestimating savings.”
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Message: Leave the number-fudging to the boss.
Capiche?

Former OMB directors on both sides of the aisle expressed concern about Orszag’s tongue-lashing of the CBO. “When I was at OMB, I was certainly critical of [CBO director Robert] Reischauer’s scoring of our health-care proposals, although I did it on the merits,” Clinton OMB director Alice Rivlin told
National Review
’s Stephen Spruiell.
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“I didn’t talk about overstepping bounds.” Douglas Holtz-Eakin, who was OMB director under George W. Bush, told Spruiell bluntly: “I’ve never seen a sitting OMB director do that.”
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Nope, no systemic problems here.

As
Chicago Tribune
columnist John Kass observed, no one should be surprised that Barack Obama brought Chicago mores to Washington:

It’s amusing to watch the Washington political establishment feign shock, now that President Barack Obama’s reform administration has used a clay foot to vigorously kick one inspector general and boot another out the door.

One inspector general foolishly investigated a friend of the president. Another inspector general audited those juicy bonuses given to AIG executives as part of [a] $700 billion federal bailout of the financial industry....

The use of political muscle may be prohibited in the mythic transcendental fairyland where much of the Obama spin originates, sprouting green and lush, like the never-ending fields of primo Hopium.

But our president is from Chicago. Obama’s Media Merlin David Axelrod and chief of staff Rahm Emanuel come right from Chicago Democratic machine boss Mayor Richard Daley. They don’t believe in fairies.
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Or in watchdogs with real teeth.

CHAPTER 1

ONWS

OBAMA NOMINEE WITHDRAWAL SYNDROME

As America thrilled to the inauguration of its 44th president and a new First Lady, the West Wing was filling with a kaleidoscopic army of policy aces, whiz kids, and veteran advisers, all focused on the long-haul, no-drama work to which Barack has called them . . .
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T
he enchanted editors of
Vanity Fair
magazine could not contain their glee. In March 2009, they rolled out a “SPECIAL COMMEMORATIVE INAUGURATION ISSUE” replete with “HISTORIC PORTRAITS OF WASHINGTON’S NEW ESTABLISHMENT” snapped by celebrity photographer Annie Liebowitz. President Obama’s fanboys and fangirls at the glossy publication hailed “the vibrant diversity of the New Guard.” Beltway journalist Maureen Orth, who interviewed Obama’s “kaleidoscopic army” for the issue, pronounced herself “amazed.” She was dazzled “not only by the audacity of their ideas but also by their apparent belief that in this stratified and partisan town they will be able to effect a sea change in attitudes.”
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