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Frist Likely to Push for Ban on Filibusters
Fri Apr 15, 1:46 PM ET
By Charles Babington, Washington Post Staff Writer
Senate Majority Leader Bill Frist is all but certain to press for a rule change that would ban filibusters of judicial nominations in the next few weeks, despite misgivings by some of his fellow Republicans and a possible Democratic backlash that could paralyze the chamber, close associates said yesterday.
The strategy carries significant risks for the Tennessee Republican, who is weighing a 2008 presidential bid. It could embroil the Senate in a bitter stalemate that would complicate passage of President Bush's agenda and raise questions about Frist's leadership capabilities. Should he fail to make the move or to get the necessary votes, however, Frist risks the ire of key conservative groups that will play big roles in the 2008 GOP primaries.
Frist feels he has no acceptable options to seeking the rule change unless there is a last-minute compromise, which neither party considers plausible, according to senators and aides close to the situation. "I think it's going to happen," Sen. John Thune (R-S.D.) said this week, although he would prefer that Frist wait to allow more legislation to pass before the Senate explodes in partisan recriminations. Aides privy to senior Republicans' thinking concur with Thune.
In response to the rising stakes and sense of an inevitable showdown, Frist and his allies are churning out speeches, articles and talking points, and enlisting the aid of Ed Gillespie, former chairman of the National Republican Committee. Frist said he is trying to catch up to Democrats and their allies, who set up a Capitol "war room" and are spending millions of dollars on TV ads denouncing the proposed rule change -- or "nuclear option" -- as a power grab.
Frist aides said he still hopes to offer a compromise Democrats might accept, but Democrats who have spoken with him say they would be astonished if he presents something they could go along with.
Democrats have used the filibuster to prevent confirmation votes this year for seven of President Bush's appellate court nominees, whom the Democrats say are too conservative. Filibusters can be stopped only by 60 votes in the 100-member Senate. Republicans, who hold 55 seats, say the filibusters thwart the Senate's constitutional duty to approve or reject a president's appointees. Democrats say the Founding Fathers wanted to empower the Senate's minority members to slow or stop controversial legislation and nominees.
While Democrats and Republicans alike say the filibuster issue is a matter of high principles and constitutional rights, Frist's choice is inextricably linked to presidential politics. At least two GOP colleagues who are pressing him to seek the rule change -- George Allen (Va.) and Rick Santorum (Pa.) -- also are weighing presidential bids. Both of them are wooing key conservatives clamoring for the filibuster ban.
Some independent analysts say that Frist -- a comparative newcomer to politics who unexpectedly gained the majority leader's post in early 2003 -- has created his own dilemma, and his handling of it will be an sign of whether he has the skills to seriously vie for the White House.
"I think Senator Frist has backed himself into a corner where I don't see how he can avoid pulling the nuclear trigger," said Charlie Cook, editor of the nonpartisan Cook Political Report. In terms of a presidential race, Cook said, "it hurts if he doesn't come up with the votes. But it also hurts him if the Senate comes to a grinding halt and can't get anything done. I think the guy's in a real jam."
Conservative activists are giving Frist little wiggle room. "If Senate Majority Leader Bill Frist hopes to capture the Republican nomination for president in 2008, then he has to see to it that the Bush judicial nominees are confirmed," Richard Lessner, executive director of the American Conservative Union, wrote in a recent article. "If he fails, then he is dead as a presidential wannabe."
Frist says he is basing his decision on constitutional principles, not politics. "I just want a reasonable up-or-down vote on the judicial nominees that come to the floor," he said this week, so that senators can "give advice and consent, which is our constitutional responsibility. It is something that we absolutely must have."
Frist had mixed results yesterday in his scramble to find 50 Republicans who will promise to vote for the rule change (Vice President Cheney could break a 50-50 tie in Frist's favor). Sen. Thad Cochran (news, bio, voting record) (R-Miss.) said he will side with his party's leader, but Sen. John McCain (news, bio, voting record) (R-Ariz.) told MSNBC, "I will vote against the nuclear option . . . because we won't always be in the majority."
Some allies say Frist can burnish his image if he wins the judicial nominations fight. "From a political point of view, if he's forced to change the Senate rules to end the filibusters, that will only help him in the Republican primary for president," said Sen. Lamar Alexander (R-Tenn.), a former presidential candidate. "It's a top issue among most Republican primary voters."
Alexander said Democrats "are badly misreading this politically" if they think the public would blame Republicans for a Senate breakdown orchestrated by Democrats. GOP aides say Frist has drawn the same conclusion. Nonetheless, Senate Democrats are vowing a scorched-earth response, noting that a single senator can dramatically slow down the chamber's work by insisting on time-consuming procedures that are normally bypassed by "unanimous consent."
They also are portraying Frist as a tool of GOP extremists. Minority Leader Harry M. Reid (D-Nev.), asked this week if the radical right is driving Frist and his lieutenants, replied: "If they decide to do this, which it appears they are going to, the answer is unequivocally -- underlined, underscored -- yes."
Santorum and Allen, meanwhile, are pressing Frist to act. "We've got to go for it, call their bluff," Allen said in an interview. In talking with Frist, he said, "I've been prodding, goading, encouraging such action. I think we need to move sooner rather than later."
"If there's a vacancy on the Supreme Court" -- which many senators expect this summer -- "we want the playing field set," said Allen, a former college football player. But only Frist, he said, "can call the snap."
GEORGE W. BUSH: "THE SACRIFICE IN IRAQ HAS BEEN WORTH IT." 6/28/2005
IF YOU AREN'T OUTRAGED, YOU HAVEN'T BEEN PAYING ATTENTION.
"Mankind must put an end to war, or war will put an end to mankind." – John F. Kennedy
Saturday, April 16, 2005
Arms Equipment Plundered in 2003 Is Surfacing in Iraq
The New York Times
April 17, 2005
Arms Equipment Plundered in 2003 Is Surfacing in Iraq
By JAMES GLANZ
KIRKUK, Iraq, April 16 - Equipment plundered from dozens of sites in Saddam Hussein's vast complex for manufacturing weapons is beginning to surface in open markets in Iraq's major cities and at border crossings.
Looters stormed the sites two years ago when Mr. Hussein's government fell, and the fate of much of the equipment has remained a mystery.
But on a recent day near the Iranian border, resting in great chunks on a weedy lot in front of an Iraqi Border Patrol warehouse, were pieces of machine tools, some weighing as much as a car, that investigators say formed the heart of a factory that made artillery shells near Baghdad. Military equipment, including parts for obscure armaments used by Mr. Hussein's army, is also turning up in Baghdad and Mosul in the north, they say.
For more than a year, large quantities of scrap metal from some of the sites have routinely been filling the scrap yards of Iraq and neighboring countries like Jordan. But with this new emergence of a huge panoply of intact factory, machine and vehicle parts, it appears that some looters may have held back the troves they stole two years ago, waiting for prices to rise.
"Spare parts?" said Staff Sgt. William Larock, an American reservist in a division out of Rochester, N.Y., who is stationed near Munthriya and is coordinating repairs of some of Mr. Hussein's old troop carriers to be used for the new Iraqi Army. "A lot of them come from the market in Baghdad."
Sergeant Larock said that some of his repairs to the vehicles, which Mr. Hussein bought from a manufacturer in Brazil, were being delayed because the asking price on the highly specialized wheels - clearly stolen long ago from those same vehicles - was too high. "That's why these things are sitting on blocks," he said with a faint smile.
Interviews with people who identified themselves as arms dealers or members of the resistance in Baghdad, Falluja and other Iraqi cities indicate that a parallel black market operates in the explosives looted from some of the same sites. In fact, sketchy descriptions by members of the Iraqi resistance suggest that the arms market is also a highly developed enterprise with brokers, buyers and looters who have stockpiled their products, including artillery shells, mortar rounds and Kalashnikov rifles. One former Iraqi army officer who said that he had joined the mujahedeen said that in Sadr City, for example, a few trusted brokers would take prospective buyers to weapons caches that ranged in size from a few rounds buried in a garden to whole rooms of ordnance. If the broker and the buyers agreed on a price, the buyers would arrive a day or two later with a vehicle to drive their purchases away. The broker and the stockpilers would have worked out their respective cuts in advance.
Witnesses described looters of varying degrees of sophistication, from local people who stormed the sites in search of precious metals after Mr. Hussein's security forces fled to highly organized operations that arrived with cranes and semitrailer trucks. Some of the most organized groups arrived earliest and drove away with largely intact equipment.
When it comes to buying run-of-the-mill equipment and spare parts that were obviously looted in the past, the American military appears to have adopted some version of a don't-ask, don't-tell policy concerning where the materials originated. The materials, after all, are now being sold openly in street markets. So the Americans appear resigned to buying the equipment back rather than seizing it.
But the pieces of the artillery factory were headed to Iran when they were seized a few months ago by Iraqi border guards. They appeared to have been cut apart just so; the dismemberment allowed the material to meet the official definition of scrap, but did no damage that would prevent the pieces from being reassembled.
"They cut in places that were not important," said Brig. Gen. Nazim Shariff Muhammad, leader of the Iraqi Border Guard in Diyala Province, standing with his right foot perched on part of the machinery. "So they let us think it was going to be used as scrap metal."
Much more valuable machinery also vanished from some of the sites in the weeks after the invasion: so-called dual-use equipment, which could be used in civilian manufacturing and in building parts for nuclear weapons. Witness accounts have indicated that much of it was carried off in systematic looting in the six to eight weeks after Baghdad fell on April 9, 2003. That equipment, which investigators say was more likely coveted for its monetary value rather than its military value, disappeared without any public trace. If an entire artillery factory could come this close to crossing the border, some military specialists say, then the dual-use equipment had a chance of getting out as well.
From Baghdad's main roads, Munthriya is the nearest border crossing, making it a natural way station for anything transported, legitimately or not, from the area around the capital.
That part of the Iraqi frontier, about 90 miles northeast of Baghdad and just south of Kurdistan, is a place out of time. For reasons that seem to be lost in the mists of history, many of the border outposts of Iraq and Iran look like miniature castles, complete with crenelated walls and cylindrical watchtowers at the corners. The outposts face each other across a no man's land of grassy hills that are still heavily mined, a legacy of the Iran-Iraq war. In the hazy distance, the Iranian mountains rise. "They are watching us," said Warrant Officer Aso Ahmed Showkat at the border post called Yassin Castle, pointing to one of the Iranian outposts.
In the weeks after Baghdad fell, the roads in that part of Iraq were choked with trucks carrying scrap metal, looted generators, cars, chopped-up tanks and other equipment, many witnesses said. Mukhtar Ahmed, who owns a tea shop in Bashmakh, north of Munthriya, estimated that as many as 300 trucks a day passed his shop at the height of the activity.
Lt. Col. Ali Muhammad Darweesh Al Kakay, who came south in that period with a Kurdish pesh merga force and is now a border official, said, "Everything, you can smuggle at that time."
Since the border patrol began mobilizing in June 2003, General Nazim said, the border had been secure, and only scrap dealers with government permits had been allowed to transport materials into Iran through the Munthriya crossing. Specific rules for what constituted scrap had been set up. A tank, for example, had to be cut into at least eight pieces, or it was judged that someone could put it back together.
In General Nazim's view, the episode of the artillery factory is a case in point. His border guards told him that there were eight or nine large trucks filled with odd-looking scrap. "But the materials inside the trucks were not scrap," he said. "I knew this was something very strange."
Engineers identified the equipment as a set of huge machine tools for making shells, and pinpointed where it had all come from: a military site called Al Walid, near Baghdad.
Now somewhat rusted from exposure, the material sits in front of the border police headquarters, and in a fitting twist, some of its more precious components have been looted a second time.
John Pike, director of GlobalSecurity.org, said the story of the artillery factory was not necessarily reassuring.
"This is just the stuff that got caught," Mr. Pike said when a reporter contacted him from Forward Operating Base Cobra, an American Army base near the border. "The more interesting stuff would have gone out first," he said.
Warzer Jaff contributed reporting for this article.
April 17, 2005
Arms Equipment Plundered in 2003 Is Surfacing in Iraq
By JAMES GLANZ
KIRKUK, Iraq, April 16 - Equipment plundered from dozens of sites in Saddam Hussein's vast complex for manufacturing weapons is beginning to surface in open markets in Iraq's major cities and at border crossings.
Looters stormed the sites two years ago when Mr. Hussein's government fell, and the fate of much of the equipment has remained a mystery.
But on a recent day near the Iranian border, resting in great chunks on a weedy lot in front of an Iraqi Border Patrol warehouse, were pieces of machine tools, some weighing as much as a car, that investigators say formed the heart of a factory that made artillery shells near Baghdad. Military equipment, including parts for obscure armaments used by Mr. Hussein's army, is also turning up in Baghdad and Mosul in the north, they say.
For more than a year, large quantities of scrap metal from some of the sites have routinely been filling the scrap yards of Iraq and neighboring countries like Jordan. But with this new emergence of a huge panoply of intact factory, machine and vehicle parts, it appears that some looters may have held back the troves they stole two years ago, waiting for prices to rise.
"Spare parts?" said Staff Sgt. William Larock, an American reservist in a division out of Rochester, N.Y., who is stationed near Munthriya and is coordinating repairs of some of Mr. Hussein's old troop carriers to be used for the new Iraqi Army. "A lot of them come from the market in Baghdad."
Sergeant Larock said that some of his repairs to the vehicles, which Mr. Hussein bought from a manufacturer in Brazil, were being delayed because the asking price on the highly specialized wheels - clearly stolen long ago from those same vehicles - was too high. "That's why these things are sitting on blocks," he said with a faint smile.
Interviews with people who identified themselves as arms dealers or members of the resistance in Baghdad, Falluja and other Iraqi cities indicate that a parallel black market operates in the explosives looted from some of the same sites. In fact, sketchy descriptions by members of the Iraqi resistance suggest that the arms market is also a highly developed enterprise with brokers, buyers and looters who have stockpiled their products, including artillery shells, mortar rounds and Kalashnikov rifles. One former Iraqi army officer who said that he had joined the mujahedeen said that in Sadr City, for example, a few trusted brokers would take prospective buyers to weapons caches that ranged in size from a few rounds buried in a garden to whole rooms of ordnance. If the broker and the buyers agreed on a price, the buyers would arrive a day or two later with a vehicle to drive their purchases away. The broker and the stockpilers would have worked out their respective cuts in advance.
Witnesses described looters of varying degrees of sophistication, from local people who stormed the sites in search of precious metals after Mr. Hussein's security forces fled to highly organized operations that arrived with cranes and semitrailer trucks. Some of the most organized groups arrived earliest and drove away with largely intact equipment.
When it comes to buying run-of-the-mill equipment and spare parts that were obviously looted in the past, the American military appears to have adopted some version of a don't-ask, don't-tell policy concerning where the materials originated. The materials, after all, are now being sold openly in street markets. So the Americans appear resigned to buying the equipment back rather than seizing it.
But the pieces of the artillery factory were headed to Iran when they were seized a few months ago by Iraqi border guards. They appeared to have been cut apart just so; the dismemberment allowed the material to meet the official definition of scrap, but did no damage that would prevent the pieces from being reassembled.
"They cut in places that were not important," said Brig. Gen. Nazim Shariff Muhammad, leader of the Iraqi Border Guard in Diyala Province, standing with his right foot perched on part of the machinery. "So they let us think it was going to be used as scrap metal."
Much more valuable machinery also vanished from some of the sites in the weeks after the invasion: so-called dual-use equipment, which could be used in civilian manufacturing and in building parts for nuclear weapons. Witness accounts have indicated that much of it was carried off in systematic looting in the six to eight weeks after Baghdad fell on April 9, 2003. That equipment, which investigators say was more likely coveted for its monetary value rather than its military value, disappeared without any public trace. If an entire artillery factory could come this close to crossing the border, some military specialists say, then the dual-use equipment had a chance of getting out as well.
From Baghdad's main roads, Munthriya is the nearest border crossing, making it a natural way station for anything transported, legitimately or not, from the area around the capital.
That part of the Iraqi frontier, about 90 miles northeast of Baghdad and just south of Kurdistan, is a place out of time. For reasons that seem to be lost in the mists of history, many of the border outposts of Iraq and Iran look like miniature castles, complete with crenelated walls and cylindrical watchtowers at the corners. The outposts face each other across a no man's land of grassy hills that are still heavily mined, a legacy of the Iran-Iraq war. In the hazy distance, the Iranian mountains rise. "They are watching us," said Warrant Officer Aso Ahmed Showkat at the border post called Yassin Castle, pointing to one of the Iranian outposts.
In the weeks after Baghdad fell, the roads in that part of Iraq were choked with trucks carrying scrap metal, looted generators, cars, chopped-up tanks and other equipment, many witnesses said. Mukhtar Ahmed, who owns a tea shop in Bashmakh, north of Munthriya, estimated that as many as 300 trucks a day passed his shop at the height of the activity.
Lt. Col. Ali Muhammad Darweesh Al Kakay, who came south in that period with a Kurdish pesh merga force and is now a border official, said, "Everything, you can smuggle at that time."
Since the border patrol began mobilizing in June 2003, General Nazim said, the border had been secure, and only scrap dealers with government permits had been allowed to transport materials into Iran through the Munthriya crossing. Specific rules for what constituted scrap had been set up. A tank, for example, had to be cut into at least eight pieces, or it was judged that someone could put it back together.
In General Nazim's view, the episode of the artillery factory is a case in point. His border guards told him that there were eight or nine large trucks filled with odd-looking scrap. "But the materials inside the trucks were not scrap," he said. "I knew this was something very strange."
Engineers identified the equipment as a set of huge machine tools for making shells, and pinpointed where it had all come from: a military site called Al Walid, near Baghdad.
Now somewhat rusted from exposure, the material sits in front of the border police headquarters, and in a fitting twist, some of its more precious components have been looted a second time.
John Pike, director of GlobalSecurity.org, said the story of the artillery factory was not necessarily reassuring.
"This is just the stuff that got caught," Mr. Pike said when a reporter contacted him from Forward Operating Base Cobra, an American Army base near the border. "The more interesting stuff would have gone out first," he said.
Warzer Jaff contributed reporting for this article.
Friday, April 15, 2005
Congress Renews Interest in Identity Theft
Yahoo! News
AP
Congress Renews Interest in Identity Theft
By TED BRIDIS, Associated Press Writer
WASHINGTON - Responding to outrage from consumers whose personal information has been stolen from companies, Congress is primed to pass new laws to try to prevent break-ins and to require businesses to confess to customers when private data is taken.
The government's new interest in requiring such embarrassing disclosures reverses years of efforts by the FBI and U.S. prosecutors to shield corporations that have been victims of hackers from bad publicity by keeping such crimes out of headlines.
But now, consumers want to know if their private information has been stolen.
The Senate is considering at least two proposals to crack down on companies suffering breaches of private customer information. The Federal Trade Commission's chairwoman has endorsed the idea and the Senate Judiciary Committee's chairman hinted this week that a new law might be inevitable.
"We may well face a necessity for some really tough legislation," said Sen. Arlen Specter, R-Pa.
The new push for government action responds to frustrated constituents who are among more than 10 million victims of identity theft each year. It comes after years of reluctance by most companies to voluntarily report break-ins that put customers' financial information at risk.
"Congress is primed to take a very serious look at this and pass comprehensive legislation," said Sen. Charles Schumer, D-N.Y., sponsor for one bill. "Nobody has given this problem the focus it deserves. This is a high priority."
A California law already requires disclosures to victimized consumers who live there, and roughly 30 states are looking at similar laws.
"The last thing a merchant wants to do is tell all his longtime customers he's been hacked and lost all their information," said Keath Nupuf, chief technology officer for CardCops Inc. of Malibu, Calif. The company monitors Internet chat rooms and other hacker communications for stolen credit card numbers, then notifies merchants and consumers to block bad purchases.
CardCops contacted 80 consumers earlier this week to report their card numbers and other personal details were circulating among Internet thieves, Nupuf said. The card numbers were pilfered from merchants that range from mom-and-pop shops to Fifth Avenue retailers.
"One guy was blowing a blood vessel," he said. "He was going to drive across country and kill the merchant."
Peiter "Mudge" Zatko, a computer expert who consulted for the White House during the Bush and Clinton administrations, often is hired by companies to tighten security and clean up the digital mess after a data breach. Zatko said victim companies "almost never" tell the FBI or customers when sensitive data is stolen.
"Maybe they have a government contract and it would look bad," Zatko said. "Maybe they're trying to keep it quiet so they don't scare the financial markets."
Sometimes companies warn customers. Howard Schmidt, a former White House adviser, said thieves took a computer this year from the store where he buys eyeglasses. The computer contained his credit and medical information, Schmidt said, but the owner contacted his customers and encouraged them to watch for fraudulent purchases.
"That was a good thing," Schmidt said. "I want to do business with these guys."
In a twist, the FBI and Justice Department have worked aggressively to shield the identities of corporations that have been hacking victims. To encourage businesses to contact them after such break-ins, U.S. investigators and prosecutors have publicly promised to seal court records, keep top executives off witness stands and use protective orders to keep details of these crimes out of the headlines.
"There is still some reluctance to call law enforcement, some hesitancy because of the negative impact on reputation," said Amit Yoran, the Bush administration's former top cyber-security official. He said requiring companies to acknowledge a break-in "may be of value, but it should not be done as a knee-jerk reaction to the handful of high-profile and significant disclosures of the past few weeks."
The FTC chairwoman, Deborah Majoras, estimated consumers lost $5 billion and businesses lost $48 billion because of identity theft in 2003. The FTC is studying how it can use existing banking statutes and laws against consumer fraud to prosecute companies that fail to report serious breaches.
Majoras said government should consider requiring companies to tell customers about break-ins when thefts put them at financial risk. She also endorsed minimum security requirements for businesses that collect sensitive personal information.
"The challenge is to come up with a way of defining when notice should be sent and when it doesn't make sense," said Joel Winston, associate director at the FTC's division for financial practices.
___
On the Net:
Federal Trade Commission: http://www.ftc.gov
CardCops: http://www.cardcops.com
AP
Congress Renews Interest in Identity Theft
By TED BRIDIS, Associated Press Writer
WASHINGTON - Responding to outrage from consumers whose personal information has been stolen from companies, Congress is primed to pass new laws to try to prevent break-ins and to require businesses to confess to customers when private data is taken.
The government's new interest in requiring such embarrassing disclosures reverses years of efforts by the FBI and U.S. prosecutors to shield corporations that have been victims of hackers from bad publicity by keeping such crimes out of headlines.
But now, consumers want to know if their private information has been stolen.
The Senate is considering at least two proposals to crack down on companies suffering breaches of private customer information. The Federal Trade Commission's chairwoman has endorsed the idea and the Senate Judiciary Committee's chairman hinted this week that a new law might be inevitable.
"We may well face a necessity for some really tough legislation," said Sen. Arlen Specter, R-Pa.
The new push for government action responds to frustrated constituents who are among more than 10 million victims of identity theft each year. It comes after years of reluctance by most companies to voluntarily report break-ins that put customers' financial information at risk.
"Congress is primed to take a very serious look at this and pass comprehensive legislation," said Sen. Charles Schumer, D-N.Y., sponsor for one bill. "Nobody has given this problem the focus it deserves. This is a high priority."
A California law already requires disclosures to victimized consumers who live there, and roughly 30 states are looking at similar laws.
"The last thing a merchant wants to do is tell all his longtime customers he's been hacked and lost all their information," said Keath Nupuf, chief technology officer for CardCops Inc. of Malibu, Calif. The company monitors Internet chat rooms and other hacker communications for stolen credit card numbers, then notifies merchants and consumers to block bad purchases.
CardCops contacted 80 consumers earlier this week to report their card numbers and other personal details were circulating among Internet thieves, Nupuf said. The card numbers were pilfered from merchants that range from mom-and-pop shops to Fifth Avenue retailers.
"One guy was blowing a blood vessel," he said. "He was going to drive across country and kill the merchant."
Peiter "Mudge" Zatko, a computer expert who consulted for the White House during the Bush and Clinton administrations, often is hired by companies to tighten security and clean up the digital mess after a data breach. Zatko said victim companies "almost never" tell the FBI or customers when sensitive data is stolen.
"Maybe they have a government contract and it would look bad," Zatko said. "Maybe they're trying to keep it quiet so they don't scare the financial markets."
Sometimes companies warn customers. Howard Schmidt, a former White House adviser, said thieves took a computer this year from the store where he buys eyeglasses. The computer contained his credit and medical information, Schmidt said, but the owner contacted his customers and encouraged them to watch for fraudulent purchases.
"That was a good thing," Schmidt said. "I want to do business with these guys."
In a twist, the FBI and Justice Department have worked aggressively to shield the identities of corporations that have been hacking victims. To encourage businesses to contact them after such break-ins, U.S. investigators and prosecutors have publicly promised to seal court records, keep top executives off witness stands and use protective orders to keep details of these crimes out of the headlines.
"There is still some reluctance to call law enforcement, some hesitancy because of the negative impact on reputation," said Amit Yoran, the Bush administration's former top cyber-security official. He said requiring companies to acknowledge a break-in "may be of value, but it should not be done as a knee-jerk reaction to the handful of high-profile and significant disclosures of the past few weeks."
The FTC chairwoman, Deborah Majoras, estimated consumers lost $5 billion and businesses lost $48 billion because of identity theft in 2003. The FTC is studying how it can use existing banking statutes and laws against consumer fraud to prosecute companies that fail to report serious breaches.
Majoras said government should consider requiring companies to tell customers about break-ins when thefts put them at financial risk. She also endorsed minimum security requirements for businesses that collect sensitive personal information.
"The challenge is to come up with a way of defining when notice should be sent and when it doesn't make sense," said Joel Winston, associate director at the FTC's division for financial practices.
___
On the Net:
Federal Trade Commission: http://www.ftc.gov
CardCops: http://www.cardcops.com
Pakistan Airports on Alert After Terror Threat
Yahoo! News
Reuters
Pakistan Airports on Alert After Terror Threat
KARACHI (Reuters) - Two of Pakistan's international airports were put on high alert on Friday because of a terror threat, a security official said.
"We have put Karachi and Lahore international airports on high-security alert after some specific aviation-related threats," Major Riaz Ahmad, a spokesman for the Airport Security Force, told Reuters.
"Security at both these airport has been beefed up on an intelligence report," he said without providing details.
Earlier this week, the U.S. consulate in Karachi remained closed for three days after its officials received threatening telephone calls.
It was not clear whether the threats were linked.
There have been a spate of terror assaults in major Pakistani cities since Islamabad joined the U.S.-led war on terror following the Sept. 11, 2001, attacks in the United States.
Police blame Islamic extremists for targeting Western concerns, religious minorities and top government officials in an attempt to undermine their country's support for the United States.
Last year, airports in Pakistan were put on high security alert several times.
Reuters
Pakistan Airports on Alert After Terror Threat
KARACHI (Reuters) - Two of Pakistan's international airports were put on high alert on Friday because of a terror threat, a security official said.
"We have put Karachi and Lahore international airports on high-security alert after some specific aviation-related threats," Major Riaz Ahmad, a spokesman for the Airport Security Force, told Reuters.
"Security at both these airport has been beefed up on an intelligence report," he said without providing details.
Earlier this week, the U.S. consulate in Karachi remained closed for three days after its officials received threatening telephone calls.
It was not clear whether the threats were linked.
There have been a spate of terror assaults in major Pakistani cities since Islamabad joined the U.S.-led war on terror following the Sept. 11, 2001, attacks in the United States.
Police blame Islamic extremists for targeting Western concerns, religious minorities and top government officials in an attempt to undermine their country's support for the United States.
Last year, airports in Pakistan were put on high security alert several times.
Deadly flu samples still missing
BBC NEWS
Deadly flu samples still missing
Samples of a potentially lethal flu strain sent to Lebanon and Mexico did not reach the respective laboratories, the World Health Organization says.
The WHO said it was trying to trace the samples, which were sent by a US testing organisation.
The samples are of Asian flu, which killed between one and four million people in 1957 but disappeared by 1968.
More than 3,700 laboratories in 18 countries received the testing kits and have been racing to destroy the virus.
The WHO says the virus could "easily cause an influenza epidemic" if not handled properly.
All but five of the countries outside US that received the kits say they have now destroyed them.
WHERE THE VIRUS WENT
Europe: Belgium, France, Germany, Italy
Americas: Bermuda, Brazil, Canada, Chile, Mexico, the US
Asia: Hong Kong, Japan, Singapore, South Korea, Taiwan
Middle East: Israel, Lebanon, Saudi Arabia
The WHO has not said how much had been destroyed in US labs, which received the vast majority of the samples.
The College of American Pathologists (Cap) said the kits had been sent to the following countries including the US: Bermuda, Belgium, Brazil, Canada, Chile, France, Germany, Hong Kong, Israel, Italy, Japan, Lebanon, Mexico, Saudi Arabia, Singapore, South Korea, Taiwan.
But the man who co-ordinates the WHO global influenza programme, Klaus Stohr, told the BBC News website that the one laboratory in Lebanon that was supposed to have been sent the kits had not received any. And one out of four laboratories in Mexico had not had any consignment either.
Mr Stohr said the WHO and Cap were trying to find out what happened to the samples sent by prestigious international carriers.
He said it was possible that the laboratories had not gone to collect the kits. However, he said the WHO was not concerned at this stage.
"There are simpler ways of interfering with the samples" if one so wished, Mr Stohr said.
No immunity
Because the virus has not been in circulation since 1968, people born after that do not have antibodies against it - and current vaccines do not guard against it.
The Cap sent out kits between October 2004 and February of this year.
On 8 April, the US government asked the body to write to the laboratories affected - of which 61 are outside the US and Canada - telling them to destroy the samples.
Given the concerns that the virus could be used in bio-terrorism, letters were sent to the laboratories before the mistake was made public.
The virus - technically known as H2N2 - was classified as Biological Safety Level 2, meaning that it was not considered particularly dangerous.
But the US government agency responsible for classifying viruses, the Centers for Disease Control and Prevention, says it was in the process of deciding whether to change the strain's classification when it found out it had been widely circulated.
The WHO says there is no guarantee that every sample of the virus can be traced and destroyed because some of the laboratories may have sent derivatives of the sample elsewhere.
But there have been no reports of anyone becoming ill from handling the virus.
Deadly flu samples still missing
Samples of a potentially lethal flu strain sent to Lebanon and Mexico did not reach the respective laboratories, the World Health Organization says.
The WHO said it was trying to trace the samples, which were sent by a US testing organisation.
The samples are of Asian flu, which killed between one and four million people in 1957 but disappeared by 1968.
More than 3,700 laboratories in 18 countries received the testing kits and have been racing to destroy the virus.
The WHO says the virus could "easily cause an influenza epidemic" if not handled properly.
All but five of the countries outside US that received the kits say they have now destroyed them.
WHERE THE VIRUS WENT
Europe: Belgium, France, Germany, Italy
Americas: Bermuda, Brazil, Canada, Chile, Mexico, the US
Asia: Hong Kong, Japan, Singapore, South Korea, Taiwan
Middle East: Israel, Lebanon, Saudi Arabia
The WHO has not said how much had been destroyed in US labs, which received the vast majority of the samples.
The College of American Pathologists (Cap) said the kits had been sent to the following countries including the US: Bermuda, Belgium, Brazil, Canada, Chile, France, Germany, Hong Kong, Israel, Italy, Japan, Lebanon, Mexico, Saudi Arabia, Singapore, South Korea, Taiwan.
But the man who co-ordinates the WHO global influenza programme, Klaus Stohr, told the BBC News website that the one laboratory in Lebanon that was supposed to have been sent the kits had not received any. And one out of four laboratories in Mexico had not had any consignment either.
Mr Stohr said the WHO and Cap were trying to find out what happened to the samples sent by prestigious international carriers.
He said it was possible that the laboratories had not gone to collect the kits. However, he said the WHO was not concerned at this stage.
"There are simpler ways of interfering with the samples" if one so wished, Mr Stohr said.
No immunity
Because the virus has not been in circulation since 1968, people born after that do not have antibodies against it - and current vaccines do not guard against it.
The Cap sent out kits between October 2004 and February of this year.
On 8 April, the US government asked the body to write to the laboratories affected - of which 61 are outside the US and Canada - telling them to destroy the samples.
Given the concerns that the virus could be used in bio-terrorism, letters were sent to the laboratories before the mistake was made public.
The virus - technically known as H2N2 - was classified as Biological Safety Level 2, meaning that it was not considered particularly dangerous.
But the US government agency responsible for classifying viruses, the Centers for Disease Control and Prevention, says it was in the process of deciding whether to change the strain's classification when it found out it had been widely circulated.
The WHO says there is no guarantee that every sample of the virus can be traced and destroyed because some of the laboratories may have sent derivatives of the sample elsewhere.
But there have been no reports of anyone becoming ill from handling the virus.
Home workers 'pose security risk'
BBC NEWS
Home workers 'pose security risk'
Working from home could pose a security threat to British businesses, costing an estimated £8.5bn a year, an IT security company has warned.
A study by Novell found 80% of Britons admit to not taking computer security precautions when working from home.
The research shows home workers are "ambivalent" to security issues, making them easy targets for hackers.
Novell says there will be an increase in security breaches if employees at home are left unchecked.
Easy target
Standard IT procedures are more likely to be ignored, and home workers are more prone to surfing the net and downloading virus-infected programmes, the company says.
The survey found British home workers to be more concerned with distractions from the television, "feeling lonely" and "missing the buzz of the office", than exposure to security breaches.
This, the company says, is making them an easy target for computer viruses and hackers.
The study also revealed three quarters of the British workforce want to work from home, while over half of British businesses have the resources to allow it.
Novell UK managing director Steve Brown said: "The benefits of having a more flexible workforce are clear, but the dangers are sometimes less obvious.
"As the numbers of home workers grow, so does the number of security risks to businesses.
Mr Brown said the only way to protect against the growing security threat was for businesses to take the responsibility off home workers.
"Successful and secure home and remote working is absolutely achievable," he added.
"If bosses feel comfortable that their employees aren't opening the door to IT security threats from their living room, workers will be one step closer to the benefits of flexible working."
Home workers 'pose security risk'
Working from home could pose a security threat to British businesses, costing an estimated £8.5bn a year, an IT security company has warned.
A study by Novell found 80% of Britons admit to not taking computer security precautions when working from home.
The research shows home workers are "ambivalent" to security issues, making them easy targets for hackers.
Novell says there will be an increase in security breaches if employees at home are left unchecked.
Easy target
Standard IT procedures are more likely to be ignored, and home workers are more prone to surfing the net and downloading virus-infected programmes, the company says.
The survey found British home workers to be more concerned with distractions from the television, "feeling lonely" and "missing the buzz of the office", than exposure to security breaches.
This, the company says, is making them an easy target for computer viruses and hackers.
The study also revealed three quarters of the British workforce want to work from home, while over half of British businesses have the resources to allow it.
Novell UK managing director Steve Brown said: "The benefits of having a more flexible workforce are clear, but the dangers are sometimes less obvious.
"As the numbers of home workers grow, so does the number of security risks to businesses.
Mr Brown said the only way to protect against the growing security threat was for businesses to take the responsibility off home workers.
"Successful and secure home and remote working is absolutely achievable," he added.
"If bosses feel comfortable that their employees aren't opening the door to IT security threats from their living room, workers will be one step closer to the benefits of flexible working."
Security scare hits HSBC's cards
BBC NEWS
Security scare hits HSBC's cards
A security scare in the US has prompted global banking giant HSBC to send out warning letters to 180,000 customers.
Holders of the General Motors GM Mastercard, issued by HSBC, are being informed that criminals may have gained access to their credit card details.
The breach occurred at a retailer, HSBC said. The Wall Street Journal claims that those being contacted had shopped at clothing firm Polo Ralph Lauren.
Credit card fraud and identity theft is a growing problem in the US and Europe.
Keeping quiet
HSBC said it was doing everything that was "humanly possible" to resolve the situation.
A representative at Polo Ralph Lauren in New York said the company was not commenting on the Wall Street Journal's story at this stage.
Recent mishaps have drawn attention to how companies protect personal information, especially if they sell this information on to insurance firms, law enforcement agencies and possible employers.
The US Senate has been hearing testimony from executives at LexisNexis, a database and information company owned by publishing giant Reed Elsevier.
LexisNexis has admitted that the personal details of 310,000 people have been improperly accessed since January 2003.
On Wednesday, executives from the firm said that there may have been earlier unreported breaches of security.
Choicepoint, a firm that verifies personal information for banks, business and governments, has also had problems, admitting that data on 145,000 people had been compromised.
US law currently does not require firms to inform clients of a security alert.
It is up the individual states to legislate and critics claim that - as a result - there is a lack of national cohesion in efforts to fight credit card fraud.
Security scare hits HSBC's cards
A security scare in the US has prompted global banking giant HSBC to send out warning letters to 180,000 customers.
Holders of the General Motors GM Mastercard, issued by HSBC, are being informed that criminals may have gained access to their credit card details.
The breach occurred at a retailer, HSBC said. The Wall Street Journal claims that those being contacted had shopped at clothing firm Polo Ralph Lauren.
Credit card fraud and identity theft is a growing problem in the US and Europe.
Keeping quiet
HSBC said it was doing everything that was "humanly possible" to resolve the situation.
A representative at Polo Ralph Lauren in New York said the company was not commenting on the Wall Street Journal's story at this stage.
Recent mishaps have drawn attention to how companies protect personal information, especially if they sell this information on to insurance firms, law enforcement agencies and possible employers.
The US Senate has been hearing testimony from executives at LexisNexis, a database and information company owned by publishing giant Reed Elsevier.
LexisNexis has admitted that the personal details of 310,000 people have been improperly accessed since January 2003.
On Wednesday, executives from the firm said that there may have been earlier unreported breaches of security.
Choicepoint, a firm that verifies personal information for banks, business and governments, has also had problems, admitting that data on 145,000 people had been compromised.
US law currently does not require firms to inform clients of a security alert.
It is up the individual states to legislate and critics claim that - as a result - there is a lack of national cohesion in efforts to fight credit card fraud.
Bush Disarms, Unilaterally
The New York Times
April 15, 2005
Bush Disarms, Unilaterally
By THOMAS L. FRIEDMAN
One of the things that I can't figure out about the Bush team is why an administration that is so focused on projecting U.S. military strength abroad has taken such little interest in America's economic competitiveness at home - the underlying engine of our strength. At a time when the global economic playing field is being flattened - enabling young Indians and Chinese to collaborate and compete with Americans more than ever before - this administration is off on an ideological jag. It is trying to take apart the New Deal by privatizing Social Security, when what we really need most today is a New New Deal to make more Americans employable in 21st-century jobs.
We have a Treasury secretary from the railroad industry. We have an administration that won't lift a finger to prevent the expensing of stock options, which is going to inhibit the ability of U.S. high-tech firms to attract talent - at a time when China encourages its start-ups to grant stock options to young innovators. And we have movie theaters in certain U.S. towns afraid to show science films because they are based on evolution and not creationism.
The Bush team is proposing cutting the Pentagon's budget for basic science and technology research by 20 percent next year - after President Bush and the Republican Congress already slashed the 2005 budget of the National Science Foundation by $100 million.
When the National Innovation Initiative, a bipartisan study by the country's leading technologists and industrialists about how to re-energize U.S. competitiveness, was unveiled last December, it was virtually ignored by the White House. Did you hear about it? Probably not, because the president preferred to focus all attention on privatizing Social Security.
It's as if we have an industrial-age presidency, catering to a pre-industrial ideological base, in a post-industrial era.
Thomas Bleha, a former U.S. Foreign Service officer in Japan, has a fascinating piece in the May-June issue of Foreign Affairs that begins like this: "In the first three years of the Bush administration, the United States dropped from 4th to 13th place in global rankings of broadband Internet usage. Today, most U.S. homes can access only 'basic' broadband, among the slowest, most expensive and least reliable in the developed world, and the United States has fallen even further behind in mobile-phone-based Internet access. The lag is arguably the result of the Bush administration's failure to make a priority of developing these networks. In fact, the United States is the only industrialized state without an explicit national policy for promoting broadband."
Since it took over in 2001, the Bush team has made it clear that its priorities are tax cuts, missile defense and the war on terrorism - not keeping the U.S. at the forefront of Internet innovation. In the administration's first three years, President Bush barely uttered the word "broadband," Mr. Bleha notes, but when America "dropped the Internet leadership baton, Japan picked it up. In 2001, Japan was well behind the United States in the broadband race. But thanks to top-level political leadership and ambitious goals, it soon began to move ahead.
"By May 2003, a higher percentage of homes in Japan than the United States had broadband. ...
"Today, nearly all Japanese have access to 'high-speed' broadband, with an average connection time 16 times faster than in the United States - for only about $22 a month. ... And that is to say nothing of Internet access through mobile phones, an area in which Japan is even further ahead of the United States. It is now clear that Japan and its neighbors will lead the charge in high-speed broadband over the next several years."
South Korea, which has the world's greatest percentage of broadband users, and urban China, which last year surpassed the U.S. in the number of broadband users, are keeping pace with Japan - not us. By investing heavily in these new technologies, Mr. Bleha notes, these nations will be the first to reap their benefits - from increased productivity to stronger platforms for technological innovation; new kinds of jobs, services and content; and rising standards of living.
Economics is not like war. It can be win-win. But you need to be at a certain level to be able to claim your share of a global pie that is both expanding and becoming more complex. Tax cuts can't solve every problem. This administration - which often seems more interested in indulging creationism than spurring creativity - is doing a very poor job of preparing the country for that next level.
April 15, 2005
Bush Disarms, Unilaterally
By THOMAS L. FRIEDMAN
One of the things that I can't figure out about the Bush team is why an administration that is so focused on projecting U.S. military strength abroad has taken such little interest in America's economic competitiveness at home - the underlying engine of our strength. At a time when the global economic playing field is being flattened - enabling young Indians and Chinese to collaborate and compete with Americans more than ever before - this administration is off on an ideological jag. It is trying to take apart the New Deal by privatizing Social Security, when what we really need most today is a New New Deal to make more Americans employable in 21st-century jobs.
We have a Treasury secretary from the railroad industry. We have an administration that won't lift a finger to prevent the expensing of stock options, which is going to inhibit the ability of U.S. high-tech firms to attract talent - at a time when China encourages its start-ups to grant stock options to young innovators. And we have movie theaters in certain U.S. towns afraid to show science films because they are based on evolution and not creationism.
The Bush team is proposing cutting the Pentagon's budget for basic science and technology research by 20 percent next year - after President Bush and the Republican Congress already slashed the 2005 budget of the National Science Foundation by $100 million.
When the National Innovation Initiative, a bipartisan study by the country's leading technologists and industrialists about how to re-energize U.S. competitiveness, was unveiled last December, it was virtually ignored by the White House. Did you hear about it? Probably not, because the president preferred to focus all attention on privatizing Social Security.
It's as if we have an industrial-age presidency, catering to a pre-industrial ideological base, in a post-industrial era.
Thomas Bleha, a former U.S. Foreign Service officer in Japan, has a fascinating piece in the May-June issue of Foreign Affairs that begins like this: "In the first three years of the Bush administration, the United States dropped from 4th to 13th place in global rankings of broadband Internet usage. Today, most U.S. homes can access only 'basic' broadband, among the slowest, most expensive and least reliable in the developed world, and the United States has fallen even further behind in mobile-phone-based Internet access. The lag is arguably the result of the Bush administration's failure to make a priority of developing these networks. In fact, the United States is the only industrialized state without an explicit national policy for promoting broadband."
Since it took over in 2001, the Bush team has made it clear that its priorities are tax cuts, missile defense and the war on terrorism - not keeping the U.S. at the forefront of Internet innovation. In the administration's first three years, President Bush barely uttered the word "broadband," Mr. Bleha notes, but when America "dropped the Internet leadership baton, Japan picked it up. In 2001, Japan was well behind the United States in the broadband race. But thanks to top-level political leadership and ambitious goals, it soon began to move ahead.
"By May 2003, a higher percentage of homes in Japan than the United States had broadband. ...
"Today, nearly all Japanese have access to 'high-speed' broadband, with an average connection time 16 times faster than in the United States - for only about $22 a month. ... And that is to say nothing of Internet access through mobile phones, an area in which Japan is even further ahead of the United States. It is now clear that Japan and its neighbors will lead the charge in high-speed broadband over the next several years."
South Korea, which has the world's greatest percentage of broadband users, and urban China, which last year surpassed the U.S. in the number of broadband users, are keeping pace with Japan - not us. By investing heavily in these new technologies, Mr. Bleha notes, these nations will be the first to reap their benefits - from increased productivity to stronger platforms for technological innovation; new kinds of jobs, services and content; and rising standards of living.
Economics is not like war. It can be win-win. But you need to be at a certain level to be able to claim your share of a global pie that is both expanding and becoming more complex. Tax cuts can't solve every problem. This administration - which often seems more interested in indulging creationism than spurring creativity - is doing a very poor job of preparing the country for that next level.
The Medical Money Pit
The New York Times
April 15, 2005
The Medical Money Pit
By PAUL KRUGMAN
A dozen years ago, everyone was talking about a health care crisis. But then the issue faded from view: a few years of good data led many people to conclude that H.M.O.'s and other innovations had ended the historic trend of rising medical costs.
But the pause in the growth of health care costs in the 1990's proved temporary. Medical costs are once again rising rapidly, and our health care system is once again in crisis. So now is a good time to ask why other advanced countries manage to spend so much less than we do, while getting better results.
Before I get to the numbers, let me deal with the usual problem one encounters when trying to draw lessons from foreign experience: somebody is sure to bring up the supposed horrors of Britain's government-run system, which historically had long waiting lists for elective surgery.
In fact, Britain's system isn't as bad as its reputation - especially for lower-paid workers, whose counterparts in the United States often have no health insurance at all. And the waiting lists have gotten shorter.
But in any case, Britain isn't the country we want to look at, because its health care system is run on the cheap, with total spending per person only 40 percent as high as ours.
The countries that have something to teach us are the nations that don't pinch pennies to the same extent - like France, Germany or Canada - but still spend far less than we do. (Yes, Canada also has waiting lists, but they're much shorter than Britain's - and Canadians overwhelmingly prefer their system to ours. France and Germany don't have a waiting list problem.)
Let me rattle off some numbers.
In 2002, the latest year for which comparable data are available, the United States spent $5,267 on health care for each man, woman and child in the population. Of this, $2,364, or 45 percent, was government spending, mainly on Medicare and Medicaid. Canada spent $2,931 per person, of which $2,048 came from the government. France spent $2,736 per person, of which $2,080 was government spending.
Amazing, isn't it? U.S. health care is so expensive that our government spends more on health care than the governments of other advanced countries, even though the private sector pays a far higher share of the bills than anywhere else.
What do we get for all that money? Not much.
Most Americans probably don't know that we have substantially lower life-expectancy and higher infant-mortality figures than other advanced countries. It would be wrong to jump to the conclusion that this poor performance is entirely the result of a defective health care system; social factors, notably America's high poverty rate, surely play a role. Still, it seems puzzling that we spend so much, with so little return.
A 2003 study published in Health Affairs (one of whose authors is my Princeton colleague Uwe Reinhardt) tried to resolve that puzzle by comparing a number of measures of health services across the advanced world. What the authors found was that the United States scores high on high-tech services - we have lots of M.R.I.'s - but on more prosaic measures, like the number of doctors' visits and number of days spent in hospitals, America is only average, or even below average. There's also direct evidence that identical procedures cost far more in the U.S. than in other advanced countries.
The authors concluded that Americans spend far more on health care than their counterparts abroad - but they don't actually receive more care. The title of their article? "It's the Prices, Stupid."
Why is the price of U.S. health care so high? One answer is doctors' salaries: although average wages in France and the United States are similar, American doctors are paid much more than their French counterparts. Another answer is that America's health care system drives a poor bargain with the pharmaceutical industry.
Above all, a large part of America's health care spending goes into paperwork. A 2003 study in The New England Journal of Medicine estimated that administrative costs took 31 cents out of every dollar the United States spent on health care, compared with only 17 cents in Canada.
In my next column in this series, I'll explain why the most privatized health care system in the advanced world is also the most bloated and bureaucratic.
E-mail: krugman@nytimes.com
April 15, 2005
The Medical Money Pit
By PAUL KRUGMAN
A dozen years ago, everyone was talking about a health care crisis. But then the issue faded from view: a few years of good data led many people to conclude that H.M.O.'s and other innovations had ended the historic trend of rising medical costs.
But the pause in the growth of health care costs in the 1990's proved temporary. Medical costs are once again rising rapidly, and our health care system is once again in crisis. So now is a good time to ask why other advanced countries manage to spend so much less than we do, while getting better results.
Before I get to the numbers, let me deal with the usual problem one encounters when trying to draw lessons from foreign experience: somebody is sure to bring up the supposed horrors of Britain's government-run system, which historically had long waiting lists for elective surgery.
In fact, Britain's system isn't as bad as its reputation - especially for lower-paid workers, whose counterparts in the United States often have no health insurance at all. And the waiting lists have gotten shorter.
But in any case, Britain isn't the country we want to look at, because its health care system is run on the cheap, with total spending per person only 40 percent as high as ours.
The countries that have something to teach us are the nations that don't pinch pennies to the same extent - like France, Germany or Canada - but still spend far less than we do. (Yes, Canada also has waiting lists, but they're much shorter than Britain's - and Canadians overwhelmingly prefer their system to ours. France and Germany don't have a waiting list problem.)
Let me rattle off some numbers.
In 2002, the latest year for which comparable data are available, the United States spent $5,267 on health care for each man, woman and child in the population. Of this, $2,364, or 45 percent, was government spending, mainly on Medicare and Medicaid. Canada spent $2,931 per person, of which $2,048 came from the government. France spent $2,736 per person, of which $2,080 was government spending.
Amazing, isn't it? U.S. health care is so expensive that our government spends more on health care than the governments of other advanced countries, even though the private sector pays a far higher share of the bills than anywhere else.
What do we get for all that money? Not much.
Most Americans probably don't know that we have substantially lower life-expectancy and higher infant-mortality figures than other advanced countries. It would be wrong to jump to the conclusion that this poor performance is entirely the result of a defective health care system; social factors, notably America's high poverty rate, surely play a role. Still, it seems puzzling that we spend so much, with so little return.
A 2003 study published in Health Affairs (one of whose authors is my Princeton colleague Uwe Reinhardt) tried to resolve that puzzle by comparing a number of measures of health services across the advanced world. What the authors found was that the United States scores high on high-tech services - we have lots of M.R.I.'s - but on more prosaic measures, like the number of doctors' visits and number of days spent in hospitals, America is only average, or even below average. There's also direct evidence that identical procedures cost far more in the U.S. than in other advanced countries.
The authors concluded that Americans spend far more on health care than their counterparts abroad - but they don't actually receive more care. The title of their article? "It's the Prices, Stupid."
Why is the price of U.S. health care so high? One answer is doctors' salaries: although average wages in France and the United States are similar, American doctors are paid much more than their French counterparts. Another answer is that America's health care system drives a poor bargain with the pharmaceutical industry.
Above all, a large part of America's health care spending goes into paperwork. A 2003 study in The New England Journal of Medicine estimated that administrative costs took 31 cents out of every dollar the United States spent on health care, compared with only 17 cents in Canada.
In my next column in this series, I'll explain why the most privatized health care system in the advanced world is also the most bloated and bureaucratic.
E-mail: krugman@nytimes.com
Frist Set to Use Religious Stage on Judicial Issue
The New York Times
April 15, 2005
Frist Set to Use Religious Stage on Judicial Issue
By DAVID D. KIRKPATRICK
WASHINGTON, April 14 - As the Senate heads toward a showdown over the rules governing judicial confirmations, Senator Bill Frist, the majority leader, has agreed to join a handful of prominent Christian conservatives in a telecast portraying Democrats as "against people of faith" for blocking President Bush's nominees.
Fliers for the telecast, organized by the Family Research Council and scheduled to originate at a Kentucky megachurch the evening of April 24, call the day "Justice Sunday" and depict a young man holding a Bible in one hand and a gavel in the other. The flier does not name participants, but under the heading "the filibuster against people of faith," it reads: "The filibuster was once abused to protect racial bias, and it is now being used against people of faith."
Organizers say they hope to reach more than a million people by distributing the telecast to churches around the country, over the Internet and over Christian television and radio networks and stations.
Dr. Frist's spokesman said the senator's speech in the telecast would reflect his previous remarks on judicial appointments. In the past he has consistently balanced a determination "not to yield" on the president's nominees with appeals to the Democrats for compromise. He has distanced himself from the statements of others like the House majority leader, Tom DeLay, who have attacked the courts, saying they are too liberal, "run amok" or are hostile to Christianity.
The telecast, however, will put Dr. Frist in a very different context. Asked about Dr. Frist's participation in an event describing the filibuster "as against people of faith," his spokesman, Bob Stevenson, did not answer the question directly.
"Senator Frist is doing everything he can to ensure judicial nominees are treated fairly and that every senator has the opportunity to give the president their advice and consent through an up or down vote," Mr. Stevenson said, adding, "He has spoken to groups all across the nation to press that point, and as long as a minority of Democrats continue to block a vote, he will continue to do so."
Some of the nation's most influential evangelical Protestants are participating in the teleconference in Louisville, including Dr. James C. Dobson, founder of Focus on the Family; Chuck Colson, the born-again Watergate figure and founder of Prison Fellowship Ministries; and Dr. Al Mohler, president of the Southern Baptist Theological Seminary.
The event is taking place as Democrats and Republicans alike are escalating their public relations campaigns in anticipation of an imminent confrontation. The Democratic minority has blocked confirmation of 10 of President Bush's judicial nominees by preventing Republicans from gaining the 60 votes needed to close debate, using the filibuster tactic often used by political minorities and most notoriously employed by opponents of civil rights.
Dr. Frist has threatened that the Republican majority might change the rules to require only a majority vote on nominees, and Democrats have vowed to bring Senate business to a standstill if he does.
On Thursday, one wavering Republican, Senator John McCain of Arizona, told a television interviewer, Chris Matthews, that he would vote against the change.
"By the way, when Bill Clinton was president, we, effectively, in the Judiciary Committee blocked a number of his nominees," Mr. McCain said.
On Thursday the Judiciary Committee sent the nomination of Thomas B. Griffith for an appellate court post to the Senate floor. Democrats say they do not intend to block Mr. Griffith's nomination.
That cleared the way for the committee to approve several previously blocked judicial appointees in the next two weeks.
The telecast also signals an escalation of the campaign for the rule change by Christian conservatives who see the current court battle as the climax of a 30-year culture war, a chance to reverse decades of legal decisions about abortion, religion in public life, gay rights and marriage.
"As the liberal, anti-Christian dogma of the left has been repudiated in almost every recent election, the courts have become the last great bastion for liberalism," Tony Perkins, president of the Family Research Council and organizer of the telecast, wrote in a message on the group's Web site. "For years activist courts, aided by liberal interest groups like the A.C.L.U., have been quietly working under the veil of the judiciary, like thieves in the night, to rob us of our Christian heritage and our religious freedoms."
Democrats accused Dr. Frist of exploiting religious faith for political ends by joining the telecast. "No party has a monopoly on faith, and for Senator Frist to participate in this kind of telecast just throws more oil on the partisan flames," said Senator Charles E. Schumer, Democrat of New York.
But Mr. Perkins stood by the characterization of Democrats as hostile to faith. "What they have done is, they have targeted people for reasons of their faith or moral position," he said, referring to Democratic criticisms of nominees over their views of cases about abortion rights or public religious expressions.
"The issue of the judiciary is really something that has been veiled by this 'judicial mystique' so our folks don't really understand it, but they are beginning to connect the dots," Mr. Perkins said in an interview, reciting a string of court decisions about prayer or displays of religion.
"They were all brought about by the courts," he said.
Democrats, for their part, are already stepping up their efforts to link Dr. Frist and the rule change with conservatives statements about unaccountable judges hostile to faith.
On Thursday, Mr. Schumer released an open letter calling on Dr. Frist to denounce such attacks. "The last thing we need is inflammatory rhetoric which on its face encourages violence against judges," he wrote.
April 15, 2005
Frist Set to Use Religious Stage on Judicial Issue
By DAVID D. KIRKPATRICK
WASHINGTON, April 14 - As the Senate heads toward a showdown over the rules governing judicial confirmations, Senator Bill Frist, the majority leader, has agreed to join a handful of prominent Christian conservatives in a telecast portraying Democrats as "against people of faith" for blocking President Bush's nominees.
Fliers for the telecast, organized by the Family Research Council and scheduled to originate at a Kentucky megachurch the evening of April 24, call the day "Justice Sunday" and depict a young man holding a Bible in one hand and a gavel in the other. The flier does not name participants, but under the heading "the filibuster against people of faith," it reads: "The filibuster was once abused to protect racial bias, and it is now being used against people of faith."
Organizers say they hope to reach more than a million people by distributing the telecast to churches around the country, over the Internet and over Christian television and radio networks and stations.
Dr. Frist's spokesman said the senator's speech in the telecast would reflect his previous remarks on judicial appointments. In the past he has consistently balanced a determination "not to yield" on the president's nominees with appeals to the Democrats for compromise. He has distanced himself from the statements of others like the House majority leader, Tom DeLay, who have attacked the courts, saying they are too liberal, "run amok" or are hostile to Christianity.
The telecast, however, will put Dr. Frist in a very different context. Asked about Dr. Frist's participation in an event describing the filibuster "as against people of faith," his spokesman, Bob Stevenson, did not answer the question directly.
"Senator Frist is doing everything he can to ensure judicial nominees are treated fairly and that every senator has the opportunity to give the president their advice and consent through an up or down vote," Mr. Stevenson said, adding, "He has spoken to groups all across the nation to press that point, and as long as a minority of Democrats continue to block a vote, he will continue to do so."
Some of the nation's most influential evangelical Protestants are participating in the teleconference in Louisville, including Dr. James C. Dobson, founder of Focus on the Family; Chuck Colson, the born-again Watergate figure and founder of Prison Fellowship Ministries; and Dr. Al Mohler, president of the Southern Baptist Theological Seminary.
The event is taking place as Democrats and Republicans alike are escalating their public relations campaigns in anticipation of an imminent confrontation. The Democratic minority has blocked confirmation of 10 of President Bush's judicial nominees by preventing Republicans from gaining the 60 votes needed to close debate, using the filibuster tactic often used by political minorities and most notoriously employed by opponents of civil rights.
Dr. Frist has threatened that the Republican majority might change the rules to require only a majority vote on nominees, and Democrats have vowed to bring Senate business to a standstill if he does.
On Thursday, one wavering Republican, Senator John McCain of Arizona, told a television interviewer, Chris Matthews, that he would vote against the change.
"By the way, when Bill Clinton was president, we, effectively, in the Judiciary Committee blocked a number of his nominees," Mr. McCain said.
On Thursday the Judiciary Committee sent the nomination of Thomas B. Griffith for an appellate court post to the Senate floor. Democrats say they do not intend to block Mr. Griffith's nomination.
That cleared the way for the committee to approve several previously blocked judicial appointees in the next two weeks.
The telecast also signals an escalation of the campaign for the rule change by Christian conservatives who see the current court battle as the climax of a 30-year culture war, a chance to reverse decades of legal decisions about abortion, religion in public life, gay rights and marriage.
"As the liberal, anti-Christian dogma of the left has been repudiated in almost every recent election, the courts have become the last great bastion for liberalism," Tony Perkins, president of the Family Research Council and organizer of the telecast, wrote in a message on the group's Web site. "For years activist courts, aided by liberal interest groups like the A.C.L.U., have been quietly working under the veil of the judiciary, like thieves in the night, to rob us of our Christian heritage and our religious freedoms."
Democrats accused Dr. Frist of exploiting religious faith for political ends by joining the telecast. "No party has a monopoly on faith, and for Senator Frist to participate in this kind of telecast just throws more oil on the partisan flames," said Senator Charles E. Schumer, Democrat of New York.
But Mr. Perkins stood by the characterization of Democrats as hostile to faith. "What they have done is, they have targeted people for reasons of their faith or moral position," he said, referring to Democratic criticisms of nominees over their views of cases about abortion rights or public religious expressions.
"The issue of the judiciary is really something that has been veiled by this 'judicial mystique' so our folks don't really understand it, but they are beginning to connect the dots," Mr. Perkins said in an interview, reciting a string of court decisions about prayer or displays of religion.
"They were all brought about by the courts," he said.
Democrats, for their part, are already stepping up their efforts to link Dr. Frist and the rule change with conservatives statements about unaccountable judges hostile to faith.
On Thursday, Mr. Schumer released an open letter calling on Dr. Frist to denounce such attacks. "The last thing we need is inflammatory rhetoric which on its face encourages violence against judges," he wrote.
Thursday, April 14, 2005
Dragnet nabs 10,000 fugitives
CNN.com
Dragnet nabs 10,000 fugitives
WASHINGTON (CNN) -- More than 10,000 fugitives from justice have been captured in a nationwide, weeklong dragnet involving federal, state and local authorities, said the U.S. Marshals Service, which led the effort.
Operation FALCON lasted from April 4 - 10 and marks the largest number of arrests ever recorded during a single operation.
Of priority: suspects wanted in homicides, sexual assaults, gang-related crimes, kidnappings, major drug offenses, and crimes against children and the elderly.
The operation captured 10,340 people, of whom 162 were wanted for murder, 638 had outstanding arrest warrants for armed robbery and 553 were wanted for rape or sexual assault.
Also captured were 106 unregistered sex offenders and 154 gang members.
"We will use all of our nation's law-enforcement resources to serve the people, to pursue justice, and to make our streets and nation safer," Attorney General Alberto Gonzales said.
More than 70 percent of those arrested had prior arrests for violent crimes, said Gonzales.
And some were considered especially dangerous. In one case, an armed man was found in a cave under a trap door in his kitchen floor, Gonzales said.
Other fugitives who were caught include operators of two methamphetamine labs and an illegal alcohol-producing still.
Officials acknowledge the decision to provide such a massive show of force at one time was expected to prompt publicity and help highlight the mission.
But they insist the operation was strictly designed to carry out law enforcement objectives.
One federal law enforcement official, who asked not to be identified, expressed surprise at the level of cooperation among the 25 federal agencies and the operation's success.
"We didn't know what to expect, but the response from law enforcement personnel everywhere was truly amazing."
Operation FALCON -- Federal and Local Cops Organized Nationally -- involved more than 3,000 law enforcement officials participating in fugitive searches. As many as 10,000 may have helped at least part of the time, officials said. Five national and 83 district fugitive task forces coordinated raids under the U.S. Marshals Service.
In addition to the Bureau of Alcohol, Tobacco, Firearms and Explosives, the FBI, the Secret Service, even the U.S. Department of Housing and Urban Development got involved.
Some fugitives relied on housing benefits, others on various Social Security benefits, sources said.
Much of the law enforcement muscle came from 206 state law enforcement agencies, 302 county sheriffs' departments and 366 city police departments.
Officials said fugitives were tracked in every state, in addition to Puerto Rico and Guam.
Gonzales said that the operation demonstrates to victims that perpetrators can be caught and prosecuted for their crimes.
The dragnet coincided with Crime Victims Rights Week.
Congress gave the Marshals Service more money and authority to go after fugitives when it refocused the FBI's mission toward stopping terrorism in the wake of the September 11, 2001, attacks, said the agency's spokesman David Turner.
Previous coordinated roundups did not involve as many officers or agencies and resulted in arrests in the hundreds, he added.
A comparison with Marshals Service arrests in all of last year gives an idea of the scope of last week's sweep.
In 2004, U.S. Marshals caught more than 36,000 federal felons and worked with state and local authorities to arrest an additional 31,600 fugitives.
Dragnet nabs 10,000 fugitives
WASHINGTON (CNN) -- More than 10,000 fugitives from justice have been captured in a nationwide, weeklong dragnet involving federal, state and local authorities, said the U.S. Marshals Service, which led the effort.
Operation FALCON lasted from April 4 - 10 and marks the largest number of arrests ever recorded during a single operation.
Of priority: suspects wanted in homicides, sexual assaults, gang-related crimes, kidnappings, major drug offenses, and crimes against children and the elderly.
The operation captured 10,340 people, of whom 162 were wanted for murder, 638 had outstanding arrest warrants for armed robbery and 553 were wanted for rape or sexual assault.
Also captured were 106 unregistered sex offenders and 154 gang members.
"We will use all of our nation's law-enforcement resources to serve the people, to pursue justice, and to make our streets and nation safer," Attorney General Alberto Gonzales said.
More than 70 percent of those arrested had prior arrests for violent crimes, said Gonzales.
And some were considered especially dangerous. In one case, an armed man was found in a cave under a trap door in his kitchen floor, Gonzales said.
Other fugitives who were caught include operators of two methamphetamine labs and an illegal alcohol-producing still.
Officials acknowledge the decision to provide such a massive show of force at one time was expected to prompt publicity and help highlight the mission.
But they insist the operation was strictly designed to carry out law enforcement objectives.
One federal law enforcement official, who asked not to be identified, expressed surprise at the level of cooperation among the 25 federal agencies and the operation's success.
"We didn't know what to expect, but the response from law enforcement personnel everywhere was truly amazing."
Operation FALCON -- Federal and Local Cops Organized Nationally -- involved more than 3,000 law enforcement officials participating in fugitive searches. As many as 10,000 may have helped at least part of the time, officials said. Five national and 83 district fugitive task forces coordinated raids under the U.S. Marshals Service.
In addition to the Bureau of Alcohol, Tobacco, Firearms and Explosives, the FBI, the Secret Service, even the U.S. Department of Housing and Urban Development got involved.
Some fugitives relied on housing benefits, others on various Social Security benefits, sources said.
Much of the law enforcement muscle came from 206 state law enforcement agencies, 302 county sheriffs' departments and 366 city police departments.
Officials said fugitives were tracked in every state, in addition to Puerto Rico and Guam.
Gonzales said that the operation demonstrates to victims that perpetrators can be caught and prosecuted for their crimes.
The dragnet coincided with Crime Victims Rights Week.
Congress gave the Marshals Service more money and authority to go after fugitives when it refocused the FBI's mission toward stopping terrorism in the wake of the September 11, 2001, attacks, said the agency's spokesman David Turner.
Previous coordinated roundups did not involve as many officers or agencies and resulted in arrests in the hundreds, he added.
A comparison with Marshals Service arrests in all of last year gives an idea of the scope of last week's sweep.
In 2004, U.S. Marshals caught more than 36,000 federal felons and worked with state and local authorities to arrest an additional 31,600 fugitives.
Broadcasters Must Reveal Video Clips' Sources, FCC Says
washingtonpost.com
Broadcasters Must Reveal Video Clips' Sources, FCC Says
By Frank Ahrens
Washington Post Staff Writer
Thursday, April 14, 2005; Page A02
Television broadcasters must disclose to viewers the origin of video news releases produced by the government or corporations when the material runs on the public airwaves, the Federal Communications Commission said yesterday.
The FCC's ruling comes as video news releases produced by the Bush administration and aired as part of local television news reports have come under attack from critics who call them unlabeled Republican propaganda.
Some members of Congress say greater disclosure is needed. Sens. Frank Lautenberg (D-N.J.) and John F. Kerry (D-Mass.) plan to introduce an amendment to a junk fax bill today that would require government agencies -- such as the Department of Health and Human Services, whose video news release on Medicare and Medicaid was deemed propaganda by the Government Accountability Office last year -- to tell viewers that a clip was produced and paid for by the U.S. government.
"The bottom line is, the government's role in these news stories needs to be disclosed," said Lautenberg, a member of the Commerce Committee, which will consider the amendment.
Yesterday, the FCC unanimously clarified rules applying to broadcasters, saying they must disclose to the viewer the origins of video news releases, though the agency does not specify what form the disclosure must take.
"We have a responsibility to tell broadcasters they have to let people know where the material is coming from," said FCC Commissioner Jonathan S. Adelstein, a Democrat. "Viewers are hoodwinked into thinking it's really a news story when it might be from the government or a big corporation trying to influence the way they think. This will put them in a better position to decide for themselves what to make of it."
Critics of the video news releases say their style -- often featuring an actor portraying a reporter interviewing a government official, giving the government's side of a issue -- easily can be confused for the journalistic reports they appear alongside of. The TV news industry is increasingly inclined to air such releases in an era of 24-hour news channels and shrinking budgets that hamper news organizations' ability to produce their own reports, experts say.
Corporations also produce and distribute video news releases to promote products or burnish their image.
The Lautenberg-Kerry amendment follows a GAO recommendation to include on-screen disclaimers during the video news release, explaining the piece was produced by the U.S. government, Lautenberg staffers said. The GAO report said the administration had violated the law by using federal money to produce propaganda.
"The government makes these things," said Dan Katz, Lautenberg's chief counsel. "If they would identify themselves upfront it would be a much more efficient way of dealing with this problem."
The Bush administration's Office of Management and Budget disagreed with the GAO's finding.
Broadcasters Must Reveal Video Clips' Sources, FCC Says
By Frank Ahrens
Washington Post Staff Writer
Thursday, April 14, 2005; Page A02
Television broadcasters must disclose to viewers the origin of video news releases produced by the government or corporations when the material runs on the public airwaves, the Federal Communications Commission said yesterday.
The FCC's ruling comes as video news releases produced by the Bush administration and aired as part of local television news reports have come under attack from critics who call them unlabeled Republican propaganda.
Some members of Congress say greater disclosure is needed. Sens. Frank Lautenberg (D-N.J.) and John F. Kerry (D-Mass.) plan to introduce an amendment to a junk fax bill today that would require government agencies -- such as the Department of Health and Human Services, whose video news release on Medicare and Medicaid was deemed propaganda by the Government Accountability Office last year -- to tell viewers that a clip was produced and paid for by the U.S. government.
"The bottom line is, the government's role in these news stories needs to be disclosed," said Lautenberg, a member of the Commerce Committee, which will consider the amendment.
Yesterday, the FCC unanimously clarified rules applying to broadcasters, saying they must disclose to the viewer the origins of video news releases, though the agency does not specify what form the disclosure must take.
"We have a responsibility to tell broadcasters they have to let people know where the material is coming from," said FCC Commissioner Jonathan S. Adelstein, a Democrat. "Viewers are hoodwinked into thinking it's really a news story when it might be from the government or a big corporation trying to influence the way they think. This will put them in a better position to decide for themselves what to make of it."
Critics of the video news releases say their style -- often featuring an actor portraying a reporter interviewing a government official, giving the government's side of a issue -- easily can be confused for the journalistic reports they appear alongside of. The TV news industry is increasingly inclined to air such releases in an era of 24-hour news channels and shrinking budgets that hamper news organizations' ability to produce their own reports, experts say.
Corporations also produce and distribute video news releases to promote products or burnish their image.
The Lautenberg-Kerry amendment follows a GAO recommendation to include on-screen disclaimers during the video news release, explaining the piece was produced by the U.S. government, Lautenberg staffers said. The GAO report said the administration had violated the law by using federal money to produce propaganda.
"The government makes these things," said Dan Katz, Lautenberg's chief counsel. "If they would identify themselves upfront it would be a much more efficient way of dealing with this problem."
The Bush administration's Office of Management and Budget disagreed with the GAO's finding.
When This Tax Hits, There's No Alternative
latimes.com
When This Tax Hits, There's No Alternative
As Americans' earnings rise, more are facing this costly levy first aimed at the very rich. The outlook for ending or reducing it is unclear.
By Joel Havemann
Times Staff Writer
April 14, 2005
WASHINGTON — As Friday's tax filing deadline approaches, more Americans are finding that a little-understood feature of the tax code called the alternative minimum tax is forcing their tax bills higher than expected.
And though cutting taxes has been a defining characteristic of President Bush and GOP congressional leaders, prospects for change are uncertain.
Instituted in 1969, the alternative minimum tax was designed to keep the richest of the rich from sheltering all their income from taxes. But due to inflation-generated wage increases, that tax has reached into the ranks of middle-income Americans, and is on course to raise the tax bills of millions of additional taxpayers in future years.
"The people who are hit by the alternative minimum tax are wage-earning salesmen, teachers, pharmacists, people that have lots of children or paid lots of local taxes — real estate, income and property taxes," said Patrick O'Malley, owner of Tax Help, a tax preparation service in Omaha. "They are not typical high-income people. And so they are shocked that their country would do this to them."
For the moment, Congress is waiting for the recommendations of the panel that President Bush has assigned to study changes to the nation's tax system. The President's Advisory Panel on Federal Tax Reform will almost surely propose eliminating or scaling back the tax, but whether its recommendations will go anywhere in Congress is uncertain.
"I would think that addressing the alternative minimum tax will be part of all the options the panel identifies," said Jeff Kupfer, the chief of the panel's staff. "It is one of the biggest problems that we've found in the tax code, and we'll certainly aim to fix it."
One option is to kill the tax. But that would deprive the government of more than $50 billion in revenue next year and $670 billion over the next decade, says the Tax Policy Center, a joint enterprise of the Brookings Institution and the Urban Institute, two nonpartisan think tanks in Washington.
Bush asked his advisory panel to structure its recommendations so that they would neither gain nor lose revenue for the government.
When combined with Bush's proposal to extend a variety of his first-term tax cuts that are due to expire, abolishing the alternative minimum tax would require the panel to find $1.2 trillion in revenue from other sources over the next 10 years, the Tax Policy Center estimates.
Lawmakers could raise about that same amount by eliminating the deduction for charitable contributions and the deduction given to homeowners on mortgage interest payments. But Bush has already ruled out those options.
Another approach would be to raise regular income tax rates. The Tax Policy Center calculates that rates would have to rise by 4% overall. For example, today's 10% bracket would rise to 10.4%, and the 35% bracket would increase to 36.4%.
The alternative minimum tax operates alongside the income tax. Taxpayers who meet certain income and deduction thresholds must calculate their taxes both ways and pay whichever is greater.
To determine what they would owe under the alternative minimum tax, taxpayers add up their income, subtract a $58,000 exemption (if they are married and filing jointly) and pay taxes on the difference — 26% on the first $175,000 and 28% on the rest. The alternative minimum tax allows no personal exemptions, and so, as O'Malley said, families with many children lose a substantial tax break. It also disallows most deductions, including those for state and local taxes.
Unlike most features of the tax code, the $58,000 exemption does not automatically rise each year with inflation, so routine wage increases have pushed increasing numbers of taxpayers into the grasp of the alternative minimum tax.
The 132,000 taxpayers who paid the alternative minimum tax in 1990 paid about $830 million more than they would have if subject to the traditional income tax, the IRS says. By 2002, the last year for which numbers are available, 1.9 million taxpayers owed $6.9 billion more than their bill would have been under the traditional income tax.
Congress has taken steps to limit the number of people affected by the tax. But those measures expire next year, and complaints from taxpayers are sure to follow. Burman estimates that the number hit by the alternative minimum tax is scheduled to soar from 3.4 million in 2005 to 18.4 million in 2006. The amount collected by the tax — beyond what people would owe if they were subject to the traditional income tax — is set to rise from $19.8 billion to $53.3 billion, he said.
Californians pay a disproportionate share of the alternative minimum tax, largely because it does not allow deductions for California's high state and local taxes. In 2003, 3.1% of federal income tax returns from California included alternative minimum tax payments, compared with 1.8% nationally. The alternative minimum tax accounted for 2.1% of Californians' tax payments, compared to 1.3% nationally.
--------------------------------------------------------------------------------
Times staff writer Elise Castelli contributed to this report.
When This Tax Hits, There's No Alternative
As Americans' earnings rise, more are facing this costly levy first aimed at the very rich. The outlook for ending or reducing it is unclear.
By Joel Havemann
Times Staff Writer
April 14, 2005
WASHINGTON — As Friday's tax filing deadline approaches, more Americans are finding that a little-understood feature of the tax code called the alternative minimum tax is forcing their tax bills higher than expected.
And though cutting taxes has been a defining characteristic of President Bush and GOP congressional leaders, prospects for change are uncertain.
Instituted in 1969, the alternative minimum tax was designed to keep the richest of the rich from sheltering all their income from taxes. But due to inflation-generated wage increases, that tax has reached into the ranks of middle-income Americans, and is on course to raise the tax bills of millions of additional taxpayers in future years.
"The people who are hit by the alternative minimum tax are wage-earning salesmen, teachers, pharmacists, people that have lots of children or paid lots of local taxes — real estate, income and property taxes," said Patrick O'Malley, owner of Tax Help, a tax preparation service in Omaha. "They are not typical high-income people. And so they are shocked that their country would do this to them."
For the moment, Congress is waiting for the recommendations of the panel that President Bush has assigned to study changes to the nation's tax system. The President's Advisory Panel on Federal Tax Reform will almost surely propose eliminating or scaling back the tax, but whether its recommendations will go anywhere in Congress is uncertain.
"I would think that addressing the alternative minimum tax will be part of all the options the panel identifies," said Jeff Kupfer, the chief of the panel's staff. "It is one of the biggest problems that we've found in the tax code, and we'll certainly aim to fix it."
One option is to kill the tax. But that would deprive the government of more than $50 billion in revenue next year and $670 billion over the next decade, says the Tax Policy Center, a joint enterprise of the Brookings Institution and the Urban Institute, two nonpartisan think tanks in Washington.
Bush asked his advisory panel to structure its recommendations so that they would neither gain nor lose revenue for the government.
When combined with Bush's proposal to extend a variety of his first-term tax cuts that are due to expire, abolishing the alternative minimum tax would require the panel to find $1.2 trillion in revenue from other sources over the next 10 years, the Tax Policy Center estimates.
Lawmakers could raise about that same amount by eliminating the deduction for charitable contributions and the deduction given to homeowners on mortgage interest payments. But Bush has already ruled out those options.
Another approach would be to raise regular income tax rates. The Tax Policy Center calculates that rates would have to rise by 4% overall. For example, today's 10% bracket would rise to 10.4%, and the 35% bracket would increase to 36.4%.
The alternative minimum tax operates alongside the income tax. Taxpayers who meet certain income and deduction thresholds must calculate their taxes both ways and pay whichever is greater.
To determine what they would owe under the alternative minimum tax, taxpayers add up their income, subtract a $58,000 exemption (if they are married and filing jointly) and pay taxes on the difference — 26% on the first $175,000 and 28% on the rest. The alternative minimum tax allows no personal exemptions, and so, as O'Malley said, families with many children lose a substantial tax break. It also disallows most deductions, including those for state and local taxes.
Unlike most features of the tax code, the $58,000 exemption does not automatically rise each year with inflation, so routine wage increases have pushed increasing numbers of taxpayers into the grasp of the alternative minimum tax.
The 132,000 taxpayers who paid the alternative minimum tax in 1990 paid about $830 million more than they would have if subject to the traditional income tax, the IRS says. By 2002, the last year for which numbers are available, 1.9 million taxpayers owed $6.9 billion more than their bill would have been under the traditional income tax.
Congress has taken steps to limit the number of people affected by the tax. But those measures expire next year, and complaints from taxpayers are sure to follow. Burman estimates that the number hit by the alternative minimum tax is scheduled to soar from 3.4 million in 2005 to 18.4 million in 2006. The amount collected by the tax — beyond what people would owe if they were subject to the traditional income tax — is set to rise from $19.8 billion to $53.3 billion, he said.
Californians pay a disproportionate share of the alternative minimum tax, largely because it does not allow deductions for California's high state and local taxes. In 2003, 3.1% of federal income tax returns from California included alternative minimum tax payments, compared with 1.8% nationally. The alternative minimum tax accounted for 2.1% of Californians' tax payments, compared to 1.3% nationally.
--------------------------------------------------------------------------------
Times staff writer Elise Castelli contributed to this report.
Disaster, Not Diplomacy
washingtonpost.com
Disaster, Not Diplomacy
By Richard Cohen
Thursday, April 14, 2005; Page A27
It is my impression -- gleaned from reviews -- that Malcolm Gladwell's book "Blink" posits that first impressions often are right on the nose. Nonetheless, for reasons having to do with caution, prudence and a debilitating sense of fair play, I have until now withheld my first -- and only -- impression of John Bolton, probably destined to be the next U.S. ambassador to the United Nations: He's nuts.
I recognize that, as a diagnosis, the word leaves something to be desired. But it is nevertheless the impression I took away back in June 2003 when Bolton went to Cernobbio, Italy, to talk to the Council for the United States and Italy. Afterward he took questions. Some of them were about weapons of mass destruction, which, you may remember, the Bush administration had claimed would be found in abundance in Iraq but which by then had not materialized.
The literal facts did not in the least give Bolton pause. Weapons of mass destruction would be found, he insisted. Where? When? How come they had not yet been discovered? The questions were insistent, but they were coming, please remember, from Italians, whose government was one of the few in the world to actively support the U.S. invasion of Iraq.
Bolton bristled. I have never seen such a performance by an American diplomat. He was dismissive. He was angry. He clearly thought the questioners had no right, no standing, no justification and no earthly reason to question the United States of America. The Bush administration had said that Iraq was lousy with WMD and Iraq therefore was lousy with WMD. Just you wait.
This kind of ferocious certainty is commendable in pit bulls and other fighting animals, but it is something of a problem in a diplomat. We now have been told, though, that Bolton's Italian aria was not unique and that the anger I sensed in the man has been felt by others. (I went over to speak to him afterward, but he was such a mass of scowling anger that I beat a retreat.) Others have testified to how he berated subordinates and how, to quote Sen. Barbara Boxer (D-Calif.), he "needs anger management." From what I saw, a bucket of cold water should always be kept at hand.
The rap against Bolton's nomination as U.N. ambassador is that he has maximum contempt for that organization. He once went so far as to flatly declare that "there is no United Nations," just an international community that occasionally "can be led by the only real power left in the world -- and that's the United States." He has expressed these sorts of feelings numerous times over the years -- so much so that it is not clear whether he has been rewarded with this appointment or punished with it. Whatever President Bush's motive, the fact remains that he has not sent the United Nations an ambassador so much as a poke in the eye. Still, no U.N. ambassador makes policy; he merely implements it. Bolton, no matter what his views, can do only limited damage.
But there are things that the United States will want done at the United Nations -- and Bolton is the wrong guy to get them done. After all, once an ambassador is instructed as to a policy or personnel issue, it is up to him or her to implement it. That means constructing the argument, persuading opponents, flattering friends. It means, in short, diplomacy.
After Bolton's appearance in Italy almost two years ago, I wrote a column expressing my dismay. I did not, however, know for sure if what I had seen was typical of him -- although others said it was. Now, though, it is clear that he is often as he was that day -- abrasive, insolent and so insufferably self-righteous that he cannot allow the possibility of his being wrong.
Why the Bush administration would want such a person at the United Nations is beyond me. As always, the administration is entitled to great leeway when it comes to presidential appointments. If it wants a neocon, fine. If it wants a hard-liner, fine. If it wants a U.N.-trasher, it can have that, too. But it should not have someone who will be ineffectual in implementing its own policies -- who, if he is himself, will alienate other delegates and further isolate the United States.
This is what Bolton did one glorious spring day on the shores of bella Lake Como. What he will do on the shores of the non-bella East River on a cold, gray day in New York will be far, far worse. Bolton's is not a bad appointment. It's a downright disaster.
cohenr@washpost.com
Disaster, Not Diplomacy
By Richard Cohen
Thursday, April 14, 2005; Page A27
It is my impression -- gleaned from reviews -- that Malcolm Gladwell's book "Blink" posits that first impressions often are right on the nose. Nonetheless, for reasons having to do with caution, prudence and a debilitating sense of fair play, I have until now withheld my first -- and only -- impression of John Bolton, probably destined to be the next U.S. ambassador to the United Nations: He's nuts.
I recognize that, as a diagnosis, the word leaves something to be desired. But it is nevertheless the impression I took away back in June 2003 when Bolton went to Cernobbio, Italy, to talk to the Council for the United States and Italy. Afterward he took questions. Some of them were about weapons of mass destruction, which, you may remember, the Bush administration had claimed would be found in abundance in Iraq but which by then had not materialized.
The literal facts did not in the least give Bolton pause. Weapons of mass destruction would be found, he insisted. Where? When? How come they had not yet been discovered? The questions were insistent, but they were coming, please remember, from Italians, whose government was one of the few in the world to actively support the U.S. invasion of Iraq.
Bolton bristled. I have never seen such a performance by an American diplomat. He was dismissive. He was angry. He clearly thought the questioners had no right, no standing, no justification and no earthly reason to question the United States of America. The Bush administration had said that Iraq was lousy with WMD and Iraq therefore was lousy with WMD. Just you wait.
This kind of ferocious certainty is commendable in pit bulls and other fighting animals, but it is something of a problem in a diplomat. We now have been told, though, that Bolton's Italian aria was not unique and that the anger I sensed in the man has been felt by others. (I went over to speak to him afterward, but he was such a mass of scowling anger that I beat a retreat.) Others have testified to how he berated subordinates and how, to quote Sen. Barbara Boxer (D-Calif.), he "needs anger management." From what I saw, a bucket of cold water should always be kept at hand.
The rap against Bolton's nomination as U.N. ambassador is that he has maximum contempt for that organization. He once went so far as to flatly declare that "there is no United Nations," just an international community that occasionally "can be led by the only real power left in the world -- and that's the United States." He has expressed these sorts of feelings numerous times over the years -- so much so that it is not clear whether he has been rewarded with this appointment or punished with it. Whatever President Bush's motive, the fact remains that he has not sent the United Nations an ambassador so much as a poke in the eye. Still, no U.N. ambassador makes policy; he merely implements it. Bolton, no matter what his views, can do only limited damage.
But there are things that the United States will want done at the United Nations -- and Bolton is the wrong guy to get them done. After all, once an ambassador is instructed as to a policy or personnel issue, it is up to him or her to implement it. That means constructing the argument, persuading opponents, flattering friends. It means, in short, diplomacy.
After Bolton's appearance in Italy almost two years ago, I wrote a column expressing my dismay. I did not, however, know for sure if what I had seen was typical of him -- although others said it was. Now, though, it is clear that he is often as he was that day -- abrasive, insolent and so insufferably self-righteous that he cannot allow the possibility of his being wrong.
Why the Bush administration would want such a person at the United Nations is beyond me. As always, the administration is entitled to great leeway when it comes to presidential appointments. If it wants a neocon, fine. If it wants a hard-liner, fine. If it wants a U.N.-trasher, it can have that, too. But it should not have someone who will be ineffectual in implementing its own policies -- who, if he is himself, will alienate other delegates and further isolate the United States.
This is what Bolton did one glorious spring day on the shores of bella Lake Como. What he will do on the shores of the non-bella East River on a cold, gray day in New York will be far, far worse. Bolton's is not a bad appointment. It's a downright disaster.
cohenr@washpost.com
Transcript of interview with Tom DeLay
The Washington Times
--------------------------------------------------------------------------------
Transcript of interview with Tom DeLay
Published April 14, 2005
--------------------------------------------------------------------------------
THE WASHINGTON TIMES
Transcript of an interview between editors and reporters from The Washington Times and House Majority Leader Tom DeLay, Texas Republican, yesterday at his Capitol office:
National Editor Ken Hanner: Ten years ago, Republicans won control of the House by running on the Contract with America, which was a blueprint for limited government. Recently, Republicans have championed expansion of federal role in education, huge new entitlement programs, including prescription drugs, and overall increases of federal spending. When did the Republicans become the party of big government?
Mr. DeLay: Well, I hope we can shed anybody's notion that that's where we are headed. First, in full disclosure, I voted against No Child Left Behind. But, that's the president's agenda. And he worked very hard to accomplish that agenda. We will revisit No Child Left Behind, look at its effectiveness and those kinds of issues. I know the president wants to extend it. But I think we have to see if No Child Left Behind is actually working before we talk about extending it.
I'm not using it as an excuse, because I came here to limit government and reduce the size of government. And as important as those two are, what I find the most important is to redesign the government, now that we have the opportunity to do that. And I'm not trying to point the finger at anybody, but I'm very proud of the fact that the House has taken the lead on many of these issues. If you look at the House bills, you couldn't make that statement.
If the House bills had become law, whether it be tax relief or spending or budgets or any of those kinds of things, the House has taken the lead in holding the line. With the small margins in the Senate, starting back when Clinton was president, we had to buy him out of town. It was obvious the Senate wouldn't go along with our aggressive tactics right at the beginning. So that cost us spending under Clinton.
When Bush came here, the Senate was still the lowest common denominator. And we had to deal with them. Now that sounds like an excuse, and I guess it is. But if you look at the real record, sans the effort to fight a war - and we'll spend whatever it takes to win the war on terror - but if you look at the other spending, it's actually been going down.
The rate of growth has gone from - I'll get you the numbers, but as I can recall - after the first year, in the second year - that's when Bush really had control and provided discipline - the rate of growth was about 5 percent. The next year, it was 4 percent. The next year, it was 3 percent. Last year, on discretionary spending, we increased spending ever so slightly, but you can say we froze discretionary spending.
The biggest spending in this government is mandatory. This House leadership has started out this new Congress, with this president and knowing that we have a better Senate, forcing the issue on looking at all mandatory spending. We started out last November working on this issue when the leadership got together ... with the White House. The White House was reluctant because it didn't think we could actually succeed. We had quite contentious discussions in that leadership meeting. The White House agreed, the Senate agreed, we were sort of moving forward on the budget that could address mandatory spending.
Our budget that we just passed just a few weeks ago is the toughest budget that we've had since 1997. And it includes a very healthy look at all mandatory spending in reconciliation. So we're headed in that direction. We know that we have to show fiscal responsibility. And we're trying to do that.
On the redesigning government part, it's been my own personal project to redesign government. We have a whole effort that started two years ago called the 21st Century Careers Initiative, which is an effort to use regulatory reform as redesigning government, and we will even get more aggressive in this part of our agenda this year and next.
Secondly, you can't redesign government till you redesign this place. I started an effort to redesign the Appropriations Committee to make it harder to spend - to make it easier to spend on our priorities and harder to spend on the Democrats' priorities. We accomplished that, and the Senate followed. We are taking an aggressive approach on the budget process. And we're going to have a budget process bill. And I've got all my chairmen who are interested in this working on that bill, along with other members. [Rep.] David Dreier [California Republican] has been charged with looking at the entire jurisdictions and committees of the House.
Remember, when we came in, we cut 30 percent of the committees budgets, we changed some jurisdiction - not a whole lot, but it was that kind of effort. And we're continuing in that effort.
Reporter Charles Hurt: A lot of smart people say that no matter how you limit the growth of spending, it's not going to have a dramatic impact on shrinking government. What three big-ticket items would you personally like to see the government get out of the business of doing?
Mr. DeLay: Well, I'm not sure I want to go there. Let me put it a different way. What people don't notice is this House has led the way and has had tax relief - sometimes more than once in a year - every year since we've been in the majority. That's really important. Some of it actually has become law. More important than that is that it's been over 10 years since we voted to raise any federal taxes. How did we do that? We grew the economy. Through our policies, we helped the economy grow.
The idea is to hold the line on spending and let the economy catch up. Balanced budgets can be done [House Minority Leader] Nancy Pelosi's way. We could do that tomorrow. We could raise enough taxes to balance the budget. That's what they did in 1993. That's not where we're going. We're holding down spending. In our budget, we actually are cutting nondefense discretionary spending. We're actually cutting it. Not just freezing it, cutting. And so you hold down spending and let the economy grow. Part of our agenda is the tax reform. We're very strong on throwing out this tax code and replacing it with a 21st century tax code that will probably allow us to double the economy in less than 10 years.
Managing Editor Fran Coombs: Isn't the reason you don't want to name big-ticket items that once you start a program ... it's difficult to get rid of the program?
Mr. DeLay: That's certainly been the case. And the Department of Education, the Department of Commerce - you're absolutely right. But the opposite is also true. If I named anything I would like to get rid of, then my ability to actually get rid of it is over.
Because the minute the press gets a hold of it, the tsunami comes in, and there's no way to make it happen.
Mr. Hurt: Does that mean that shrinking or limiting government is not the priority, but that the priority is to grow into the government we have?
Mr. DeLay: No, no, no. Shrinking government and limiting government are actually two different things. Limiting the government in your life, regulatory, social issues and all that and shrinking the size of government or reprioritizing - or as I like to say it, 'redesigning' - government to reflect our values are very important.
I know some may have opposed what we did in Medicare. I'm very proud of what we did in Medicare.
Reporter Ralph Z. Hallow: Why?
Mr. DeLay: Because if we didn't do anything, it would break this country. What we did, we instituted - not in a pretty way - but we instituted our philosophy and our values, bringing in competition, trying to eliminate third-party payments, bringing in co-payments ... now they are instituted. And they are part of the Medicare program.
Mr. Hallow: Why are so few conservatives in your own conference on board?
Mr. DeLay: Let me finish. Let me finish. We'e got value - our values - instituted in there. And the most important thing that will change health care in this country is health savings accounts. That was the biggest victory in the Medicare system. So if Medicare gets out of whack and is not going like we think it will go, and the cost curve will be bent because of what we've instituted, then we've got those institutions and we can dial them in and out and make them happen. If you go with the philosophy of the Democrats - a government-run health care program for the senior citizens - you can't do that. You have limited choices. You can raise taxes, raise premiums, or you can cut benefits, do those types of Democrat adjustments.
Now we have opportunities to bring in more competition. If it isn't working, we can raise co-payments, we can put the decisions for health care for senior citizens in the consumers' hands, not in the government's hands. It's a huge sea change. Huge. That's why the Democrats are fighting so hard against Social Security. They think we'll do the same thing to Social Security. Now I'll answer your question.
Mr. Hallow: Why do so few conservatives on your own conference agree with you on this?
Mr. DeLay: A few of them don't. Last time I checked, it was only about five or six who actually voted against the Medicare bill.
Reporter Stephen Dinan: Senate Majority Leader Bill Frist wants you to drop the Real ID Act from the supplemental spending bill, and Minority Leader Harry Reid has threatened to stall it by turning it into a debate over immigration. Do you support keeping the Real ID Act, and how will you ensure it remains in the supplemental bill?
Mr. DeLay: Stay strong. I think [Rep.] James Sensenbrenner [Wisconsin Republican] did a fantastic job in bringing America's attention to what he was trying to do in protecting our borders. What we did with border security, it's not immigration. We have told Bill Frist and all those who wanted to do immigration that we intend to do immigration reform as part of this Congress. And we are more than willing to work with the Senate in doing that.
I don't know if [Senate Minority Leader] Harry Reid [Nevada Democrat] can hold his members or more importantly get some Republicans to go along with him on his efforts. That's not my job. My job is to protect the borders of this country. We have tried to do that and answer the recommendations of the 9/11 commission. That's what these are. And in the supplemental - a supplemental that fights the war on terror, and part of that is protecting our borders - if there are senators that have a problem with that, they ought to go to their constituents and tell them why.
Mr. Dinan: So if Tom DeLay has anything to say about this conference report, it will have Real ID?
Mr. DeLay: Well, I'd just as soon not make it about me. The House has stated its position, and the House is going to stand by its position. It's not Tom DeLay.
Editorial Page Editor Tony Blankley: What about the proposal by Sen. Larry Craig [Idaho Republican] to grant amnesty to [illegal immigrant] farm workers?
Mr. DeLay: Well, I'm one of those that supports a guest-worker approach of a different kind. Now as for Larry Craig's approach, I am not sure we want to do that now in isolation to an overall --
Mr. Blankley: If that comes back in the conference report, isn't that going to create a conflict for a lot of conservatives?
Mr. DeLay: It certainly will. Anybody that takes any immigration and puts it in the supplemental is jeopardizing the supplemental, because we need to go through regular order on immigration. We don't need to drop it in the conference report. This is too important for the American people. We need a national debate about this, and we're going to have that national debate.
Mr. Blankley: Is that the position of the House conferees?
Mr. DeLay: Uh-huh.
Mr. Coombs: What kind of immigration reform do you want to see in this Congress?
Mr. DeLay: Well, I hate to bias what I'd like to see. I think it's incredibly important - before we even look at guest worker or anything else - to convince the American people that we are protecting our borders. I personally think that we ought to use the eyes and ears of our military. You'll never build a wall high enough or deep enough to keep people from coming over the Rio Grande River. They're gonna come to feed their families no matter what you do. But you can build a seeing-eye wall. I mean, we can read your license plate from satellites. We can set up our systems with Predators [remote-control unmanned surveillance planes] and everything. We don't need these guys down there - and God bless them for doing it - to watch people coming over the border. We can use our military -Mr. Hallow: Mr. DeLay: Yes. We can spot them, pick up the phone, call the Border Patrol and let them go pick them up. I mean, how hard is that? Ultimately, we need to enforce our laws. The American people need to see us protect our borders and enforce our laws. And then, they'll be willing to talk about a guest-worker program, understanding that once you've gone after those that are here illegally ? you won't get them all - and protecting the borders, then, when you have a guest-worker program that is properly done, for instance, don't let people that have broken the law get up to the front of the line. A simple thing like, if you want to be in the guest-worker program, you have to go home and apply for it in the country of origin. That kind of thing. You got to go back, you can't bring your family. That kind of stuff.
Mr. Hallow: It sounds like you're at odds with the White House on this.
Mr. DeLay: No. I've talked to the president about this. He thinks the country of origin is a good idea. He's open to other ideas. He's a little tough on bringing your family. But the key here is you don't want to bring your family, don't allow it - they go home anyway now illegally. They go back and forth all the time. It's not a matter of breaking up families, it's a matter of good sense. If they bring the family and they get established here, they'll never go home.
Mr. Coombs: Will the House then be pushing for more Border Patrol funding and things like that?
Mr. DeLay: Oh yeah. Absolutely. And we'll be looking at the ideas that are out there like I have stated in using the military ?
Mr. Hallow: Is the White House on board with that?
Mr. DeLay: Not yet. You cannot put soldiers on the border. Soldiers are trained to kill. They're not trained as border patrol or police, and you cannot do that. But you can use their technology.
Mr. Coombs: Is it realistic to think that the millions of illegal immigrants in this country will be willing to return to their countries of origin to apply for a guest-worker program?
Mr. DeLay: If we're enforcing the law, they will. Because it puts a lot of pressure on them if they know that we're not just looking the other way like we're doing now.
Mr. Coombs:[Homeland Security Undersecretary] Asa Hutchinson told The Washington Times about six months ago that the American public didn't have the will to deal with illegal immigration, to push these people out if necessary.
Mr. DeLay: Well, there is a conflict here. I'll never forget a rather elderly lady that I was sitting by at a lunch who was just ranting and raving about all these illegals that are over here. And I said, 'Well, fine.' We got to talking. You know, she had a yard man, she had a maid, she had some illegals living across the street. I said, 'Well, I'll tell you what, I'll call up right now and pick up your maid, your yard man and the people living across the street.' [She said,] 'Oh, don't you do that. Don't you do that. I want the ones that are up there in North Houston to be picked up.'
Mr. Hanner: Do you agree with the president that the Minuteman Project on the border right now are vigilantes?
Mr. DeLay: No. I'm not sure the president meant that. I think that they're providing an excellent service. It's no different than neighborhood-watch programs and I appreciate them doing it, as long as they can do it safely and don't get involved and do it the way they seem to be doing it, and that's just identifying people for the Border Patrol to come pick up.
Mr. Coombs: Are all the recent stories and questions about your ethical behavior undercutting your agenda? How badly are they hurting?
Mr. DeLay: No. I'm very proud of what we've already done. I mean, we've sent a class action bill. Our lawsuit abuse reform is well on track. This week, we're going to send the president a bankruptcy bill. We passed the budget as I mentioned. That was tough to do, but we did it. I'm very proud of that. We're doing an energy bill next week. We're going to do [Central American Free Trade Agreement] sometimes in the next few weeks. We've got a very ambitious appropriations schedule. If we pull it off for the first time since I've been here, we're going to have every appropriations bill out of the House by the July Fourth break. We're going to do a lot more lawsuit abuse reform, tax reform. Nothing has slowed down here.
Mr. Coombs: At your regular press conference later today, 30 minutes will be devoted to answering questions about your ethics.
DeLay: I'm not going to answer them.
Mr. Coombs: Aren't members of your conference going to be scared of the charges?
Mr. DeLay: No, actually, what's going on is I just came from a conference. What they are doing is, they are solidifying and unifying the Republican conference.
Mr. Coombs:Who is ?they??
Mr. DeLay: The Democrats. This is the Democrats' agenda. They don't have an agenda.
Mr. Coombs:Where's your public support?
Mr. DeLay: Have you not seen the television in the last few days? Members are out on television, they're talking about it. There's a huge conservative movement out there that's working very hard. There's friends all over the place working hard. Listen, if I didn't have any support, I'd have been gone a long time ago. The members - you need to talk to the members. But my sense is they understand what this is. They're looking at the charges and they're just shaking their heads.
The fact is that I have certain international responsibilities given to me by my leadership position but, more importantly, by my interests. They're not writing about my trips to the Soviet Union in the 1980s to get persecuted Jews out of the Soviet Union, participating in the Refusenik Movement. They're not writing about the trips that - I went to Central America fighting the communists and Sandinistas. They're not writing about the fact that I'm heavily involved in stopping human trafficking, especially of children in Southeast Asia and in Africa, and using children as sex toys and taking children and putting them in guerilla organizations. They're not talking about human rights violations when I went to China, talking about religious freedom and human rights violations in China. They're not talking about the fact that I was in England, working on a conservative movement there - working with Margaret Thatcher, that's why I was there - in trying to build a conservative movement in England.
I do a lot of things that require me to travel. We do it legally. Back then - particularly eight years ago, when I was talking about the Russia trip - back then, we were being criticized as a body for taking [congressional delegations on taxpayer-funded trips]. And so, I felt if somebody - a conservative organization - invites me to go on the efforts I just outlined, it's better to go on that private money than on [taxpayer-funded trips]. And we did it all legally, fully disclosed who we went with. Now, if I'm responsible for each organization and if I have to go in any time I talk to a group and I have to go through their donor lists - which are not disclosable, by the way - and ask them to give me a list of their donors so I can decide whether to talk to you or not, I can't do that.
Mr. Dinan: You have one of the most extensive and effective alumni employee network in Washington, and yet it seems you were late to realize the onslaught you were going to be facing. How much do you fight back.
Mr. DeLay: Well, first of all, we aren't late to this. This started when the [Democratic Congressional Campaign Committee] brought a [Racketeer Influenced and Corrupt Organizations] suit against me five or six years ago. We've been involved in this. Now it's not as heated as it is now. I don't have 18 to 20 news organizations that are spending full time on me back then. But this is a new - we haven't done this before. Thanks to campaign-finance reform, the Democrats have been very good at using 527s and their 'good government' groups and all these groups and using them to develop a strategy to advance their agenda. No one's had to deal with this before. So yeah, we're late in getting our organizations together, but I feel pretty good about where we are right now in pushing back and telling the truth, which is really important.
Mr. Coombs: Why are 18 to 20 news organizations jumping through that hoop?
Mr. DeLay: I think you ought to ask them that. I think that's a very good question to ask them - why they are spending all these resources just to print old news that's been written. The same news has been written over the last 10 years, and they're just simply printing the old news.
Now they failed to print the fact that admonishments are not a sanction of the House, that admonishments in this ethics committee - we don't know if I'm the most admonished member of the House, because it used to be when you were admonished, in other words warned, that you ought to look at what you were doing, there was a private letter to you, undisclosed. This committee not only admonished me, but released all the facts of the admonishment, which is not a sanction, and they failed to report that all the charges [former Rep.] Chris Bell [Texas Democrat] brought against me were dismissed, and he was sanctioned for violating the House rules and using the ethics committee for political purposes.
Somebody ought to ask the New York Times why they're shopping an op-ed piece. I mean, that's activist journalism. Somebody ought to look at the organizations and ask the New York Times, the Washington Post, the L.A. Times, Time, Newsweek, AP why they're spending all these resources they are, who they talked to ... are they collaborating with all these organizations that are funded by George Soros and his heavy hitters, and do these organizations ever talk to each other? Of course they do, they have people that are on the same boards. I mean, different boards but same people.
Mr. Hallow: Let me ask you about why Sen. Santorum told you to come clean.
Mr. DeLay: Santorum answered it properly.
Mr. Hallow: He did?
Mr. DeLay: Absolutely. I appreciate what he said. Everything he said. There is nothing wrong with what he said. He did not attack me, nor did he remove himself from me.
Mr. Dinan: But he did encourage you to come forward.
Mr. DeLay: I have been coming forward, and he did it in the context of the way to fight this is to come forward, which is exactly what I have been doing. In fact, I am putting together the entire case and everything that we have, and I'm going to give it to the ethics committee and ask them to look at it.
Mr. Dinan: You've been talking about that for a few weeks. How do you do that specifically?
Mr. DeLay: First of all, you have to go to present conditions. The Democrats don't want an ethics committee for two reasons. One, they know that all of this is privileged and that the only way I can be cleared is through the ethics committee, so they don't want one. Secondly, one of their best friends, [Rep.] Jim McDermott [Washington Democrat], is being investigated, and they don't want him to be kicked out of Congress. I mean, this guy has been found guilty - guilty by a court of law - and they don't want an ethics committee.
What the speaker [of the House] did, I did not do. I had no contact with the speaker when he was working on the rules changes, I had no contact with the speaker when his choices of who goes on the committee - I want to get that very clear. What the speaker did, though, is recognize that the Democrats used the rules of the House to politicize the ethics committee. The Chris Bell issue is a perfect example of that. And it's because of a quirk in the rules that Democrats found and used, and that is, if they don't vote, then you're held in limbo. And all we did was change the rule that said in order to go to the investigative subcommittee, you have to have an affirmative vote of the committee, which means a majority. That's all he did. And, two other process provisions: One, you are allowed to have your lawyer, not a lawyer picked by the ethics committee, to represent you. And two, go back to this admonishment thing. When we were admonished, [Rep.] Candice Miller [Michigan Republican] and I were admonished, first of all we didn't know we were the subject of the investigation, and secondly we had no right to plead our case. They did not ask us, they just admonished us and turned out the stuff to the public. That is absolutely contrary to the Constitution of the United States.
Mr. Dinan: In terms of going to the committee with all of the information, how do you see that happening? What's the mechanism?
Mr. DeLay: The mechanism is, the chairman and the ranking member look at the facts and determine whether they ought to recommend to the committee to proceed with an investigative subcommittee.
Mr. Dinan: You'll provide them with all the documents and yourself as well?
Mr. DeLay: Absolutely. I've been trying to do this for four weeks. I sent them two letters. But [Rep.] Alan Mollahan [West Virginia Democrat] does not want - and we'll see if he'll sit down, look at the facts and talk to me as his appointed position dictates him to do, or is he more interested in politics.
Mr. Hurt: When the committee admonished you for the 2002 fundraiser, you said you accepted their guidance. How have you changed the manner in which you've raised money since then?
Mr. DeLay: Well, first and foremost, I agree that perception now is a new standard for me, and that's what this was about, was perception. And everything we do, we add a new standard when we are doing our job, no matter whether it's in policy, or outside, or whatever we're doing, a new standard is: 'What is it going to look like on the front page of The Washington Times?' And that perception is incredibly important, and so we discuss it and we deal with it that way.
First of all, there was nothing wrong with that fundraiser, any different than fundraisers all over this country. I'm not saying everybody does it. The point is there's nothing wrong with it. There was nothing wrong in this case. I accept their guidance. I don't accept their admonishment. I don't accept the way it was done, because I had no due process, and it was put out into the public. Now my admonishments are treated as if I was convicted of a felony in the press. And secondly, there is nothing wrong in having fundraisers or going on trips or meeting with the lobbyists or citizens of any ilk. They have a right to petition the government. And there's nothing that connects me with that fundraiser, and I don't do this, and any policy decisions or votes. Now they're trying to do that.
Secondly, I was admonished for calling up the [Federal Aviation Administration] for information I could get on the internet. I was called by a constituent, as I see it, the speaker of the House of the Texas Legislature, wanting me to find an airplane, and gave me the tail number. I asked a staffer to do it, called it up, there's nothing wrong with that. And there's nothing unethical about that. My job is to interface with the federal government. There's nothing illegal about it. It's on the internet. What I should have done is turned around to my internet and looked it up.
Mr. Dinan: You said perception is a new standard. Do you believe you crossed the line in perception in that instance?
Mr. DeLay: No, absolutely not. I am doing my job. These Democrats were breaking Texas law [by leaving the state to prevent the Legislature from passing a redistricting plan].
Mr. Blankley: Is there any public procedure you can use to show Democrats have frozen the ethics committee?
I have been wrongly accused for five to six years of frivolous things, we have beaten back all of those frivolous things. This stuff that's in the press is frivolous, and the only way I know to vindicate myself is through the ethics process.
Mr. Hurt: Have you ever crossed the line of ethical behavior in terms of dealing with lobbyists, your use of government authority or with fundraising?
Mr. DeLay: Ever is a very strong word. Let me start out by saying, you can never find anything that I have done for personal gain. Period. What I'm doing is what I believe in, I'm doing it the way I believe in it. Yes, I'm aggressive. I'm passionate about what I believe in, and I'm passionate about winning and accomplishing our agenda. I know since 1995 that everything that we have done has been checked by lawyers, double-checked by lawyers, triple-checked by lawyers, because I know I have been watched and investigated probably more than even Bill Clinton. They can't find anything, so they're going back to my childhood, going to my family, going to things that happened eight years ago. There's nothing there. And they can keep looking. There's nothing there. I have tried to act ethically, I have tried to act honestly. I have tried to keep my reputation - to fight for my reputation - while it's been besmirched, and I have tried to do it in a way that brings honor to the House.
Mr. Hallow: Is there anything you want to change in perception about what you're asking on judges?
Mr. DeLay: Look, I'm for an independent judiciary. I don't know where they get this. When you attack the left's legislative body, they get really upset. But I'm for an independent judiciary. I'm for an independent Congress. I'm for an independent executive. But the Constitution of the United States gives us responsibility for oversight and checks and balances over the executive as well as the judiciary. And we all know that this judiciary is extremely active. I have asked the Judiciary Committee to look at it and give recommendations as to what we ought to do. Read the book Men in Black.
Mr. Dinan: You've been talking about going after activist judges since at least 1997. The [Terri] Schiavo case gives you a chance to do that, but you've recently said you blame Congress for not being zealous in oversight.
Mr. DeLay: Not zealous. I blame Congress over the last 50 to 100 years for not standing up and taking its responsibility given to it by the Constitution. The reason the judiciary has been able to impose a separation of church and state that's nowhere in the Constitution is that Congress didn't stop them. The reason we had judicial review is because Congress didn't stop them. The reason we had a right to privacy is because Congress didn't stop them.
Mr. Dinan: How can Congress stop them?
Mr. DeLay: There's all kinds of ways available to them.
Mr. Dinan: You tried two last year on the Defense of Marriage Act and the Pledge of Allegiance, and the Senate didn't go along with those.
Mr. DeLay: We're having to change a whole culture in this - a culture created by law schools. People really believe that these are nine gods, and that all wisdom is vested in them. This means it's a slow, long-term process. I mean, we passed six bills out of the House limiting jurisdiction. We passed an amendment last September breaking up the Ninth Circuit. These are all things that have passed the House of Representatives.
Mr. Dinan: Are you going to pursue impeaching judges?
Mr. DeLay: I'm not going to answer that. I have asked the Judiciary Committee to look at this. They're going to start holding hearings on different issues. They are more capable than me to look at this issue and take responsibility, given the, whatever, the Constitution.
Mr. Hallow: The president told [Israeli Prime Minister Ariel] Sharon no more settlements.
Mr. DeLay: You're not going to get me in a fight with the president.
Mr. Coombs: In today's Republican conference, you're saying they are solidly behind you?
Mr. DeLay: I feel their support. It is absolutely incredibly energizing and confidence-building, and more importantly heartwarming, the expressions of support members have given to me, not just individually but corporately in the conference.
Mr. Coombs: You don't see a lessening of support?
Mr. DeLay: Not at all.
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Transcript of interview with Tom DeLay
Published April 14, 2005
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THE WASHINGTON TIMES
Transcript of an interview between editors and reporters from The Washington Times and House Majority Leader Tom DeLay, Texas Republican, yesterday at his Capitol office:
National Editor Ken Hanner: Ten years ago, Republicans won control of the House by running on the Contract with America, which was a blueprint for limited government. Recently, Republicans have championed expansion of federal role in education, huge new entitlement programs, including prescription drugs, and overall increases of federal spending. When did the Republicans become the party of big government?
Mr. DeLay: Well, I hope we can shed anybody's notion that that's where we are headed. First, in full disclosure, I voted against No Child Left Behind. But, that's the president's agenda. And he worked very hard to accomplish that agenda. We will revisit No Child Left Behind, look at its effectiveness and those kinds of issues. I know the president wants to extend it. But I think we have to see if No Child Left Behind is actually working before we talk about extending it.
I'm not using it as an excuse, because I came here to limit government and reduce the size of government. And as important as those two are, what I find the most important is to redesign the government, now that we have the opportunity to do that. And I'm not trying to point the finger at anybody, but I'm very proud of the fact that the House has taken the lead on many of these issues. If you look at the House bills, you couldn't make that statement.
If the House bills had become law, whether it be tax relief or spending or budgets or any of those kinds of things, the House has taken the lead in holding the line. With the small margins in the Senate, starting back when Clinton was president, we had to buy him out of town. It was obvious the Senate wouldn't go along with our aggressive tactics right at the beginning. So that cost us spending under Clinton.
When Bush came here, the Senate was still the lowest common denominator. And we had to deal with them. Now that sounds like an excuse, and I guess it is. But if you look at the real record, sans the effort to fight a war - and we'll spend whatever it takes to win the war on terror - but if you look at the other spending, it's actually been going down.
The rate of growth has gone from - I'll get you the numbers, but as I can recall - after the first year, in the second year - that's when Bush really had control and provided discipline - the rate of growth was about 5 percent. The next year, it was 4 percent. The next year, it was 3 percent. Last year, on discretionary spending, we increased spending ever so slightly, but you can say we froze discretionary spending.
The biggest spending in this government is mandatory. This House leadership has started out this new Congress, with this president and knowing that we have a better Senate, forcing the issue on looking at all mandatory spending. We started out last November working on this issue when the leadership got together ... with the White House. The White House was reluctant because it didn't think we could actually succeed. We had quite contentious discussions in that leadership meeting. The White House agreed, the Senate agreed, we were sort of moving forward on the budget that could address mandatory spending.
Our budget that we just passed just a few weeks ago is the toughest budget that we've had since 1997. And it includes a very healthy look at all mandatory spending in reconciliation. So we're headed in that direction. We know that we have to show fiscal responsibility. And we're trying to do that.
On the redesigning government part, it's been my own personal project to redesign government. We have a whole effort that started two years ago called the 21st Century Careers Initiative, which is an effort to use regulatory reform as redesigning government, and we will even get more aggressive in this part of our agenda this year and next.
Secondly, you can't redesign government till you redesign this place. I started an effort to redesign the Appropriations Committee to make it harder to spend - to make it easier to spend on our priorities and harder to spend on the Democrats' priorities. We accomplished that, and the Senate followed. We are taking an aggressive approach on the budget process. And we're going to have a budget process bill. And I've got all my chairmen who are interested in this working on that bill, along with other members. [Rep.] David Dreier [California Republican] has been charged with looking at the entire jurisdictions and committees of the House.
Remember, when we came in, we cut 30 percent of the committees budgets, we changed some jurisdiction - not a whole lot, but it was that kind of effort. And we're continuing in that effort.
Reporter Charles Hurt: A lot of smart people say that no matter how you limit the growth of spending, it's not going to have a dramatic impact on shrinking government. What three big-ticket items would you personally like to see the government get out of the business of doing?
Mr. DeLay: Well, I'm not sure I want to go there. Let me put it a different way. What people don't notice is this House has led the way and has had tax relief - sometimes more than once in a year - every year since we've been in the majority. That's really important. Some of it actually has become law. More important than that is that it's been over 10 years since we voted to raise any federal taxes. How did we do that? We grew the economy. Through our policies, we helped the economy grow.
The idea is to hold the line on spending and let the economy catch up. Balanced budgets can be done [House Minority Leader] Nancy Pelosi's way. We could do that tomorrow. We could raise enough taxes to balance the budget. That's what they did in 1993. That's not where we're going. We're holding down spending. In our budget, we actually are cutting nondefense discretionary spending. We're actually cutting it. Not just freezing it, cutting. And so you hold down spending and let the economy grow. Part of our agenda is the tax reform. We're very strong on throwing out this tax code and replacing it with a 21st century tax code that will probably allow us to double the economy in less than 10 years.
Managing Editor Fran Coombs: Isn't the reason you don't want to name big-ticket items that once you start a program ... it's difficult to get rid of the program?
Mr. DeLay: That's certainly been the case. And the Department of Education, the Department of Commerce - you're absolutely right. But the opposite is also true. If I named anything I would like to get rid of, then my ability to actually get rid of it is over.
Because the minute the press gets a hold of it, the tsunami comes in, and there's no way to make it happen.
Mr. Hurt: Does that mean that shrinking or limiting government is not the priority, but that the priority is to grow into the government we have?
Mr. DeLay: No, no, no. Shrinking government and limiting government are actually two different things. Limiting the government in your life, regulatory, social issues and all that and shrinking the size of government or reprioritizing - or as I like to say it, 'redesigning' - government to reflect our values are very important.
I know some may have opposed what we did in Medicare. I'm very proud of what we did in Medicare.
Reporter Ralph Z. Hallow: Why?
Mr. DeLay: Because if we didn't do anything, it would break this country. What we did, we instituted - not in a pretty way - but we instituted our philosophy and our values, bringing in competition, trying to eliminate third-party payments, bringing in co-payments ... now they are instituted. And they are part of the Medicare program.
Mr. Hallow: Why are so few conservatives in your own conference on board?
Mr. DeLay: Let me finish. Let me finish. We'e got value - our values - instituted in there. And the most important thing that will change health care in this country is health savings accounts. That was the biggest victory in the Medicare system. So if Medicare gets out of whack and is not going like we think it will go, and the cost curve will be bent because of what we've instituted, then we've got those institutions and we can dial them in and out and make them happen. If you go with the philosophy of the Democrats - a government-run health care program for the senior citizens - you can't do that. You have limited choices. You can raise taxes, raise premiums, or you can cut benefits, do those types of Democrat adjustments.
Now we have opportunities to bring in more competition. If it isn't working, we can raise co-payments, we can put the decisions for health care for senior citizens in the consumers' hands, not in the government's hands. It's a huge sea change. Huge. That's why the Democrats are fighting so hard against Social Security. They think we'll do the same thing to Social Security. Now I'll answer your question.
Mr. Hallow: Why do so few conservatives on your own conference agree with you on this?
Mr. DeLay: A few of them don't. Last time I checked, it was only about five or six who actually voted against the Medicare bill.
Reporter Stephen Dinan: Senate Majority Leader Bill Frist wants you to drop the Real ID Act from the supplemental spending bill, and Minority Leader Harry Reid has threatened to stall it by turning it into a debate over immigration. Do you support keeping the Real ID Act, and how will you ensure it remains in the supplemental bill?
Mr. DeLay: Stay strong. I think [Rep.] James Sensenbrenner [Wisconsin Republican] did a fantastic job in bringing America's attention to what he was trying to do in protecting our borders. What we did with border security, it's not immigration. We have told Bill Frist and all those who wanted to do immigration that we intend to do immigration reform as part of this Congress. And we are more than willing to work with the Senate in doing that.
I don't know if [Senate Minority Leader] Harry Reid [Nevada Democrat] can hold his members or more importantly get some Republicans to go along with him on his efforts. That's not my job. My job is to protect the borders of this country. We have tried to do that and answer the recommendations of the 9/11 commission. That's what these are. And in the supplemental - a supplemental that fights the war on terror, and part of that is protecting our borders - if there are senators that have a problem with that, they ought to go to their constituents and tell them why.
Mr. Dinan: So if Tom DeLay has anything to say about this conference report, it will have Real ID?
Mr. DeLay: Well, I'd just as soon not make it about me. The House has stated its position, and the House is going to stand by its position. It's not Tom DeLay.
Editorial Page Editor Tony Blankley: What about the proposal by Sen. Larry Craig [Idaho Republican] to grant amnesty to [illegal immigrant] farm workers?
Mr. DeLay: Well, I'm one of those that supports a guest-worker approach of a different kind. Now as for Larry Craig's approach, I am not sure we want to do that now in isolation to an overall --
Mr. Blankley: If that comes back in the conference report, isn't that going to create a conflict for a lot of conservatives?
Mr. DeLay: It certainly will. Anybody that takes any immigration and puts it in the supplemental is jeopardizing the supplemental, because we need to go through regular order on immigration. We don't need to drop it in the conference report. This is too important for the American people. We need a national debate about this, and we're going to have that national debate.
Mr. Blankley: Is that the position of the House conferees?
Mr. DeLay: Uh-huh.
Mr. Coombs: What kind of immigration reform do you want to see in this Congress?
Mr. DeLay: Well, I hate to bias what I'd like to see. I think it's incredibly important - before we even look at guest worker or anything else - to convince the American people that we are protecting our borders. I personally think that we ought to use the eyes and ears of our military. You'll never build a wall high enough or deep enough to keep people from coming over the Rio Grande River. They're gonna come to feed their families no matter what you do. But you can build a seeing-eye wall. I mean, we can read your license plate from satellites. We can set up our systems with Predators [remote-control unmanned surveillance planes] and everything. We don't need these guys down there - and God bless them for doing it - to watch people coming over the border. We can use our military -Mr. Hallow: Mr. DeLay: Yes. We can spot them, pick up the phone, call the Border Patrol and let them go pick them up. I mean, how hard is that? Ultimately, we need to enforce our laws. The American people need to see us protect our borders and enforce our laws. And then, they'll be willing to talk about a guest-worker program, understanding that once you've gone after those that are here illegally ? you won't get them all - and protecting the borders, then, when you have a guest-worker program that is properly done, for instance, don't let people that have broken the law get up to the front of the line. A simple thing like, if you want to be in the guest-worker program, you have to go home and apply for it in the country of origin. That kind of thing. You got to go back, you can't bring your family. That kind of stuff.
Mr. Hallow: It sounds like you're at odds with the White House on this.
Mr. DeLay: No. I've talked to the president about this. He thinks the country of origin is a good idea. He's open to other ideas. He's a little tough on bringing your family. But the key here is you don't want to bring your family, don't allow it - they go home anyway now illegally. They go back and forth all the time. It's not a matter of breaking up families, it's a matter of good sense. If they bring the family and they get established here, they'll never go home.
Mr. Coombs: Will the House then be pushing for more Border Patrol funding and things like that?
Mr. DeLay: Oh yeah. Absolutely. And we'll be looking at the ideas that are out there like I have stated in using the military ?
Mr. Hallow: Is the White House on board with that?
Mr. DeLay: Not yet. You cannot put soldiers on the border. Soldiers are trained to kill. They're not trained as border patrol or police, and you cannot do that. But you can use their technology.
Mr. Coombs: Is it realistic to think that the millions of illegal immigrants in this country will be willing to return to their countries of origin to apply for a guest-worker program?
Mr. DeLay: If we're enforcing the law, they will. Because it puts a lot of pressure on them if they know that we're not just looking the other way like we're doing now.
Mr. Coombs:[Homeland Security Undersecretary] Asa Hutchinson told The Washington Times about six months ago that the American public didn't have the will to deal with illegal immigration, to push these people out if necessary.
Mr. DeLay: Well, there is a conflict here. I'll never forget a rather elderly lady that I was sitting by at a lunch who was just ranting and raving about all these illegals that are over here. And I said, 'Well, fine.' We got to talking. You know, she had a yard man, she had a maid, she had some illegals living across the street. I said, 'Well, I'll tell you what, I'll call up right now and pick up your maid, your yard man and the people living across the street.' [She said,] 'Oh, don't you do that. Don't you do that. I want the ones that are up there in North Houston to be picked up.'
Mr. Hanner: Do you agree with the president that the Minuteman Project on the border right now are vigilantes?
Mr. DeLay: No. I'm not sure the president meant that. I think that they're providing an excellent service. It's no different than neighborhood-watch programs and I appreciate them doing it, as long as they can do it safely and don't get involved and do it the way they seem to be doing it, and that's just identifying people for the Border Patrol to come pick up.
Mr. Coombs: Are all the recent stories and questions about your ethical behavior undercutting your agenda? How badly are they hurting?
Mr. DeLay: No. I'm very proud of what we've already done. I mean, we've sent a class action bill. Our lawsuit abuse reform is well on track. This week, we're going to send the president a bankruptcy bill. We passed the budget as I mentioned. That was tough to do, but we did it. I'm very proud of that. We're doing an energy bill next week. We're going to do [Central American Free Trade Agreement] sometimes in the next few weeks. We've got a very ambitious appropriations schedule. If we pull it off for the first time since I've been here, we're going to have every appropriations bill out of the House by the July Fourth break. We're going to do a lot more lawsuit abuse reform, tax reform. Nothing has slowed down here.
Mr. Coombs: At your regular press conference later today, 30 minutes will be devoted to answering questions about your ethics.
DeLay: I'm not going to answer them.
Mr. Coombs: Aren't members of your conference going to be scared of the charges?
Mr. DeLay: No, actually, what's going on is I just came from a conference. What they are doing is, they are solidifying and unifying the Republican conference.
Mr. Coombs:Who is ?they??
Mr. DeLay: The Democrats. This is the Democrats' agenda. They don't have an agenda.
Mr. Coombs:Where's your public support?
Mr. DeLay: Have you not seen the television in the last few days? Members are out on television, they're talking about it. There's a huge conservative movement out there that's working very hard. There's friends all over the place working hard. Listen, if I didn't have any support, I'd have been gone a long time ago. The members - you need to talk to the members. But my sense is they understand what this is. They're looking at the charges and they're just shaking their heads.
The fact is that I have certain international responsibilities given to me by my leadership position but, more importantly, by my interests. They're not writing about my trips to the Soviet Union in the 1980s to get persecuted Jews out of the Soviet Union, participating in the Refusenik Movement. They're not writing about the trips that - I went to Central America fighting the communists and Sandinistas. They're not writing about the fact that I'm heavily involved in stopping human trafficking, especially of children in Southeast Asia and in Africa, and using children as sex toys and taking children and putting them in guerilla organizations. They're not talking about human rights violations when I went to China, talking about religious freedom and human rights violations in China. They're not talking about the fact that I was in England, working on a conservative movement there - working with Margaret Thatcher, that's why I was there - in trying to build a conservative movement in England.
I do a lot of things that require me to travel. We do it legally. Back then - particularly eight years ago, when I was talking about the Russia trip - back then, we were being criticized as a body for taking [congressional delegations on taxpayer-funded trips]. And so, I felt if somebody - a conservative organization - invites me to go on the efforts I just outlined, it's better to go on that private money than on [taxpayer-funded trips]. And we did it all legally, fully disclosed who we went with. Now, if I'm responsible for each organization and if I have to go in any time I talk to a group and I have to go through their donor lists - which are not disclosable, by the way - and ask them to give me a list of their donors so I can decide whether to talk to you or not, I can't do that.
Mr. Dinan: You have one of the most extensive and effective alumni employee network in Washington, and yet it seems you were late to realize the onslaught you were going to be facing. How much do you fight back.
Mr. DeLay: Well, first of all, we aren't late to this. This started when the [Democratic Congressional Campaign Committee] brought a [Racketeer Influenced and Corrupt Organizations] suit against me five or six years ago. We've been involved in this. Now it's not as heated as it is now. I don't have 18 to 20 news organizations that are spending full time on me back then. But this is a new - we haven't done this before. Thanks to campaign-finance reform, the Democrats have been very good at using 527s and their 'good government' groups and all these groups and using them to develop a strategy to advance their agenda. No one's had to deal with this before. So yeah, we're late in getting our organizations together, but I feel pretty good about where we are right now in pushing back and telling the truth, which is really important.
Mr. Coombs: Why are 18 to 20 news organizations jumping through that hoop?
Mr. DeLay: I think you ought to ask them that. I think that's a very good question to ask them - why they are spending all these resources just to print old news that's been written. The same news has been written over the last 10 years, and they're just simply printing the old news.
Now they failed to print the fact that admonishments are not a sanction of the House, that admonishments in this ethics committee - we don't know if I'm the most admonished member of the House, because it used to be when you were admonished, in other words warned, that you ought to look at what you were doing, there was a private letter to you, undisclosed. This committee not only admonished me, but released all the facts of the admonishment, which is not a sanction, and they failed to report that all the charges [former Rep.] Chris Bell [Texas Democrat] brought against me were dismissed, and he was sanctioned for violating the House rules and using the ethics committee for political purposes.
Somebody ought to ask the New York Times why they're shopping an op-ed piece. I mean, that's activist journalism. Somebody ought to look at the organizations and ask the New York Times, the Washington Post, the L.A. Times, Time, Newsweek, AP why they're spending all these resources they are, who they talked to ... are they collaborating with all these organizations that are funded by George Soros and his heavy hitters, and do these organizations ever talk to each other? Of course they do, they have people that are on the same boards. I mean, different boards but same people.
Mr. Hallow: Let me ask you about why Sen. Santorum told you to come clean.
Mr. DeLay: Santorum answered it properly.
Mr. Hallow: He did?
Mr. DeLay: Absolutely. I appreciate what he said. Everything he said. There is nothing wrong with what he said. He did not attack me, nor did he remove himself from me.
Mr. Dinan: But he did encourage you to come forward.
Mr. DeLay: I have been coming forward, and he did it in the context of the way to fight this is to come forward, which is exactly what I have been doing. In fact, I am putting together the entire case and everything that we have, and I'm going to give it to the ethics committee and ask them to look at it.
Mr. Dinan: You've been talking about that for a few weeks. How do you do that specifically?
Mr. DeLay: First of all, you have to go to present conditions. The Democrats don't want an ethics committee for two reasons. One, they know that all of this is privileged and that the only way I can be cleared is through the ethics committee, so they don't want one. Secondly, one of their best friends, [Rep.] Jim McDermott [Washington Democrat], is being investigated, and they don't want him to be kicked out of Congress. I mean, this guy has been found guilty - guilty by a court of law - and they don't want an ethics committee.
What the speaker [of the House] did, I did not do. I had no contact with the speaker when he was working on the rules changes, I had no contact with the speaker when his choices of who goes on the committee - I want to get that very clear. What the speaker did, though, is recognize that the Democrats used the rules of the House to politicize the ethics committee. The Chris Bell issue is a perfect example of that. And it's because of a quirk in the rules that Democrats found and used, and that is, if they don't vote, then you're held in limbo. And all we did was change the rule that said in order to go to the investigative subcommittee, you have to have an affirmative vote of the committee, which means a majority. That's all he did. And, two other process provisions: One, you are allowed to have your lawyer, not a lawyer picked by the ethics committee, to represent you. And two, go back to this admonishment thing. When we were admonished, [Rep.] Candice Miller [Michigan Republican] and I were admonished, first of all we didn't know we were the subject of the investigation, and secondly we had no right to plead our case. They did not ask us, they just admonished us and turned out the stuff to the public. That is absolutely contrary to the Constitution of the United States.
Mr. Dinan: In terms of going to the committee with all of the information, how do you see that happening? What's the mechanism?
Mr. DeLay: The mechanism is, the chairman and the ranking member look at the facts and determine whether they ought to recommend to the committee to proceed with an investigative subcommittee.
Mr. Dinan: You'll provide them with all the documents and yourself as well?
Mr. DeLay: Absolutely. I've been trying to do this for four weeks. I sent them two letters. But [Rep.] Alan Mollahan [West Virginia Democrat] does not want - and we'll see if he'll sit down, look at the facts and talk to me as his appointed position dictates him to do, or is he more interested in politics.
Mr. Hurt: When the committee admonished you for the 2002 fundraiser, you said you accepted their guidance. How have you changed the manner in which you've raised money since then?
Mr. DeLay: Well, first and foremost, I agree that perception now is a new standard for me, and that's what this was about, was perception. And everything we do, we add a new standard when we are doing our job, no matter whether it's in policy, or outside, or whatever we're doing, a new standard is: 'What is it going to look like on the front page of The Washington Times?' And that perception is incredibly important, and so we discuss it and we deal with it that way.
First of all, there was nothing wrong with that fundraiser, any different than fundraisers all over this country. I'm not saying everybody does it. The point is there's nothing wrong with it. There was nothing wrong in this case. I accept their guidance. I don't accept their admonishment. I don't accept the way it was done, because I had no due process, and it was put out into the public. Now my admonishments are treated as if I was convicted of a felony in the press. And secondly, there is nothing wrong in having fundraisers or going on trips or meeting with the lobbyists or citizens of any ilk. They have a right to petition the government. And there's nothing that connects me with that fundraiser, and I don't do this, and any policy decisions or votes. Now they're trying to do that.
Secondly, I was admonished for calling up the [Federal Aviation Administration] for information I could get on the internet. I was called by a constituent, as I see it, the speaker of the House of the Texas Legislature, wanting me to find an airplane, and gave me the tail number. I asked a staffer to do it, called it up, there's nothing wrong with that. And there's nothing unethical about that. My job is to interface with the federal government. There's nothing illegal about it. It's on the internet. What I should have done is turned around to my internet and looked it up.
Mr. Dinan: You said perception is a new standard. Do you believe you crossed the line in perception in that instance?
Mr. DeLay: No, absolutely not. I am doing my job. These Democrats were breaking Texas law [by leaving the state to prevent the Legislature from passing a redistricting plan].
Mr. Blankley: Is there any public procedure you can use to show Democrats have frozen the ethics committee?
I have been wrongly accused for five to six years of frivolous things, we have beaten back all of those frivolous things. This stuff that's in the press is frivolous, and the only way I know to vindicate myself is through the ethics process.
Mr. Hurt: Have you ever crossed the line of ethical behavior in terms of dealing with lobbyists, your use of government authority or with fundraising?
Mr. DeLay: Ever is a very strong word. Let me start out by saying, you can never find anything that I have done for personal gain. Period. What I'm doing is what I believe in, I'm doing it the way I believe in it. Yes, I'm aggressive. I'm passionate about what I believe in, and I'm passionate about winning and accomplishing our agenda. I know since 1995 that everything that we have done has been checked by lawyers, double-checked by lawyers, triple-checked by lawyers, because I know I have been watched and investigated probably more than even Bill Clinton. They can't find anything, so they're going back to my childhood, going to my family, going to things that happened eight years ago. There's nothing there. And they can keep looking. There's nothing there. I have tried to act ethically, I have tried to act honestly. I have tried to keep my reputation - to fight for my reputation - while it's been besmirched, and I have tried to do it in a way that brings honor to the House.
Mr. Hallow: Is there anything you want to change in perception about what you're asking on judges?
Mr. DeLay: Look, I'm for an independent judiciary. I don't know where they get this. When you attack the left's legislative body, they get really upset. But I'm for an independent judiciary. I'm for an independent Congress. I'm for an independent executive. But the Constitution of the United States gives us responsibility for oversight and checks and balances over the executive as well as the judiciary. And we all know that this judiciary is extremely active. I have asked the Judiciary Committee to look at it and give recommendations as to what we ought to do. Read the book Men in Black.
Mr. Dinan: You've been talking about going after activist judges since at least 1997. The [Terri] Schiavo case gives you a chance to do that, but you've recently said you blame Congress for not being zealous in oversight.
Mr. DeLay: Not zealous. I blame Congress over the last 50 to 100 years for not standing up and taking its responsibility given to it by the Constitution. The reason the judiciary has been able to impose a separation of church and state that's nowhere in the Constitution is that Congress didn't stop them. The reason we had judicial review is because Congress didn't stop them. The reason we had a right to privacy is because Congress didn't stop them.
Mr. Dinan: How can Congress stop them?
Mr. DeLay: There's all kinds of ways available to them.
Mr. Dinan: You tried two last year on the Defense of Marriage Act and the Pledge of Allegiance, and the Senate didn't go along with those.
Mr. DeLay: We're having to change a whole culture in this - a culture created by law schools. People really believe that these are nine gods, and that all wisdom is vested in them. This means it's a slow, long-term process. I mean, we passed six bills out of the House limiting jurisdiction. We passed an amendment last September breaking up the Ninth Circuit. These are all things that have passed the House of Representatives.
Mr. Dinan: Are you going to pursue impeaching judges?
Mr. DeLay: I'm not going to answer that. I have asked the Judiciary Committee to look at this. They're going to start holding hearings on different issues. They are more capable than me to look at this issue and take responsibility, given the, whatever, the Constitution.
Mr. Hallow: The president told [Israeli Prime Minister Ariel] Sharon no more settlements.
Mr. DeLay: You're not going to get me in a fight with the president.
Mr. Coombs: In today's Republican conference, you're saying they are solidly behind you?
Mr. DeLay: I feel their support. It is absolutely incredibly energizing and confidence-building, and more importantly heartwarming, the expressions of support members have given to me, not just individually but corporately in the conference.
Mr. Coombs: You don't see a lessening of support?
Mr. DeLay: Not at all.
Political Payrolls Include Families
latimes.com
Political Payrolls Include Families
Dozens of members of Congress have paid relatives for campaign work, records show. The practice, though legal, is coming under scrutiny.
By Richard Simon, Chuck Neubauer and Rone Tempest
Times Staff Writers
April 14, 2005
WASHINGTON — At least 39 members of Congress have engaged in the controversial practice of paying their spouses, children or other relatives out of campaign funds, or have hired companies in which a family member had a financial interest, records and interviews show.
House campaign funds have paid more than $3 million to lawmakers' relatives over the last two election cycles, records show.
The practice is not illegal but has come under new scrutiny following reports that House Majority Leader Tom DeLay's wife and daughter had received hundreds of thousands of dollars since 2001 from his political action and congressional campaign committees. It also comes after disclosures that relatives of members of Congress have been hired by special interests as lobbyists or consultants.
Lawmakers are barred from putting relatives on their congressional payrolls, but they can pay them to work on their campaigns as long as the family member does bona fide work and isn't paid significantly more than the market rate.
The bipartisan practice has been increasingly criticized by government watchdogs and members of Congress.
"Instinctively, it doesn't pass the smell test for me, and I don't think it would for my constituents," said Rep. Ray LaHood (R-Ill.). LaHood said he had never employed relatives and thought the practice was wrong.
"Public service should not be a way to build a family fortune," said Celia Wexler, vice president for advocacy at Common Cause.
Many lawmakers who have hired relatives say their motivation is confidence, not profit.
"I need a campaign manager I can trust," said Rep. Dana Rohrabacher (R-Huntington Beach), whose wife, Rhonda, is now paid $40,000 a year to run his campaign. Over the last four years, she has received $114,894, records show.
DeLay, a Texas Republican, has defended the payments to his wife, Christine, and his daughter, Danielle DeLay Ferro, saying his family members provided valuable service to his campaign. They received $473,801 over the last two election cycles, records show.
His daughter has managed some of his recent congressional campaigns and has worked as a fundraiser for his political action committee, and his wife provides "strategic guidance" for the political action committee.
The Times developed a list of names of relatives and businesses owned by relatives on campaign payrolls from interviews, news accounts and personal financial disclosure reports. Campaign reports do not have to disclose whether recipients of funds are related to a candidate, so The Times' list is most likely incomplete.
The Times analyzed Federal Election Commission data compiled by the Center for Responsive Politics, a nonprofit, nonpartisan organization that researches campaign finance issues. The analysis, which covered 2001 through 2004, did not include such items as reimbursements for travel or other routine campaign expenses.
Among the recipients of the largest payments were members of DeLay's family and those of Rep. Richard W. Pombo (R-Tracy). Pombo paid his wife and brother $357,325 from his political fund over the last four years for duties listed as bookkeeping, fundraising, consulting and other unspecified services, records show.
The amount paid to Pombo's family members in the last election cycle was more than his opponent spent on his entire campaign. Pombo declined to be interviewed.
Including Pombo, five of the top six congressional families in The Times' analysis of two election cycles were Californians. The campaign fund of Rep. Zoe Lofgren (D-San Jose) paid $251,853 to her husband's firm, according to the candidate's campaign filings. She was followed by Rep. Howard L. Berman (D-North Hollywood), $205,500; Rep. Bob Filner (D-San Diego), $154,504; and Rep. Howard P. "Buck" McKeon (R-Santa Clarita), $152,362.
Altogether, at least 10 lawmakers in the 53-member California House delegation have hired family members, according to records and interviews.
Rep. Pete Stark (D-Hayward) paid his wife, Deborah, $119,000 from his campaign fund over the last four years to serve as his campaign manager, records show. In the last election, she earned $2,400 a month as campaign manager and was awarded a $2,400 bonus.
"It's just a matter of paying her for the professional job she was doing," Stark said.
In addition, Sen. Barbara Boxer (D-Calif.) paid her son, a lawyer, $130,000 over four years to run her political action committee, according to her campaign filings.
A spokesman for Sen. Dianne Feinstein (D-Calif.) said that she had not put family members on the campaign payroll.
No computer database was available to allow for a comprehensive search of Senate campaign expenditure records.
In the case of Pombo, 44, politics has been a family affair since the former ranch hand, butcher and truck driver first ran for Congress.
Beginning with his first House race in 1991, Pombo's younger brother Randy has been his campaign manager and treasurer. Another younger sibling, Ray, sometimes catered the congressman's tri-tip and oysters barbecue fundraisers.
In the early years, wife Annette remained in the background, managing the couple's Tracy household, raising their three children and contributing a recipe for Apple Walnut Crisscross Pie to her husband's official website.
But by March 2003, Annette, a Tracy High School valedictorian who has a degree from Loyola Marymount University, had joined the campaign. She was paid $85,275 for her work over the last two years, records show.
Randy Pombo has been paid $272,050 in the last four years, records show.
In the 2003-04 campaign cycle, Pombo paid more to his family members — $217,000 — than his opponent, Jerry McNerney, spent on his campaign. McNerney, a Pleasanton mathematician, spent $154,677. He lost to Pombo 61% to 39%.
Wayne Johnson, a partner in the Sacramento political consulting firm JohnsonClark Associates, which also worked for Pombo, described a family-run campaign operation.
"Randy has been there from the beginning, back when they were bootstrapping everything and Richard, who was then a Tracy city councilman, was not even expected to make it out of the primary," Johnson said. "And I know that when you called down there during the last campaign season, Annette was the one answering the phone."
Lawmakers offer a variety of reasons for putting family members on the campaign payroll.
Rep. Ron Lewis (R-Ky.), whose wife, Kayi, receives $40,000 a year from the congressman's campaign fund to serve as his campaign manager, acknowledged being "very nervous about appearances." But he said he would "rather run the risk of a bad appearance than to have somebody steal all my money or to have some errors [in campaign finance reports] costing me big fines."
Boxer said that she had heard horror stories from colleagues about campaign workers who had absconded with funds, and she knew that she would never have that problem if she put her son, Doug, in charge.
Boxer added that she turned to her son because he was the most qualified candidate. "Who is the best person to run your operation — that's the key thing to me," she said.
Several lawmakers said the family members they hired were professional consultants who had worked for other candidates. And, they said, they often obtained services at bargain prices.
"My wife did this for many years before she worked on our campaign," said Filner, whose wife Jane's company, Campaign Resources, was paid $154,504 in campaign funds during the last two election cycles.
Berman's campaign paid $205,500 to two firms headed by his brother Michael, a longtime campaign consultant, over the four-year period. The congressman said he thought the payments included debts he carried over from his 1998 and 2002 campaigns.
"The good news for me is that one of the most talented campaign strategists happens to be my brother," Berman said.
Berman, a former member of the House ethics committee, said that according to the chamber's rules, "you are not supposed to use your campaign funds for personal expenses or matters unrelated to politics. The test is what kind of work they are performing. I'm getting one of the most talented campaign strategists at a pretty good price. Out on the commercial marketplace, my brother makes a lot more money."
Lofgren's campaign paid her husband's company, Collins Day, $251,853 during the four-year period for fundraising, filing campaign finance reports and other political activities.
Lofgren noted that Collins Day also worked for other politicians.
"It's really important that [campaign finance reports] be done right," Lofgren said. She joked that when she was a county supervisor, her husband did the work as a volunteer — "and it was always late." Now that she pays his company, she said, "it gets done."
Rep. Elton Gallegly (R-Simi Valley) said his wife, Janice, worked as an unpaid volunteer for his campaign for 18 years before she began receiving $2,600 a month last year for tasks such as keeping the campaign books. He said her compensation was far less than what she made before giving up her job as an escrow officer to work on the campaign. She has been paid a total of $28,636, records show.
"She's always been an independent woman," Gallegly said. "So it was at my suggestion that she get some kind of compensation so she wouldn't have to come to me every time she wanted to buy something for one of the grandkids. If you average it over 18 years, she's made about $140 a month."
A spokesman for McKeon said the congressman's wife, Patricia, was a "valuable part of the congressman's campaign team" who ran the campaign office, filed campaign finance reports and oversaw all of the congressman's fundraising. Records show she was paid $152,362 over four years by McKeon's campaign committee.
"There is no one who the congressman trusts more," the spokesman said, noting that McKeon's wife worked on the congressman's campaign without pay for seven years.
Opinions vary on whether hiring relatives is appropriate and ethical.
Kenneth Gross, a former chief of enforcement at the FEC, said, "When you're in a high position, so many people are trying to get a piece of you that sometimes you have to retreat to family as among the few people who you really, truly can trust — who you believe have only your best interest in mind."
As long as a family member is performing legitimate campaign work and payments are disclosed, "there certainly shouldn't be any rule against it," said Gross, a Washington lawyer.
Fred Wertheimer, president of Democracy 21, a campaign finance watchdog group in Washington, said the practice should be prohibited. Campaign payments to family members could potentially become a way to get around the ban on the personal use of political funds, he said.
"In many races for Congress, there is no serious opposition, and members build up substantial war chests that can easily lead to the temptation to start making payments to family members, which can in effect become payments … to the benefit of members themselves," he said. "This kind of activity does create problems in terms of public perceptions. It does create the potential for self-dealing."
FEC regulations permit salary payments to family members for "bona fide, campaign-related services," according to a 2001 advisory opinion issued to Rep. Jesse L. Jackson Jr. (D-Ill.). Jackson had asked the commission whether he could hire his wife, Sandi, as a paid campaign consultant.
"Any salary in excess of fair market value of the services provided is personal use," the opinion said, noting that it was illegal for candidates to use campaign funds for personal use.
There is one complaint before the FEC about a member of Congress paying relatives for campaign work.
The Colorado Democratic Party filed a complaint against former Rep. Scott McInnis (R-Colo.) last year questioning McInnis' payment of $39,000 to his wife, Lori, from his congressional campaign committee after he announced he would not be seeking reelection. Democrats labeled the payments excessive and "unseemly."
McInnis said that the payments to his wife were legitimate and complied with FEC rules. He said a response to the complaint had been filed with the FEC.
"Her work is public and all her payments are public," McInnis said, adding that his wife's salary had been based on the pay scale for congressional employees with similar responsibilities. "She ran the campaign with an iron fist."
Rep. Ralph M. Hall (R-Texas), whose political committee paid his daughter-in-law Jody $123,761 for the last two campaigns, said, "I don't see anything wrong with it if she's doing real work for real pay."
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ON THE WEB
Previous stories on the practice of hiring lawmakers' family members can be found at latimes.com/lawmakers.
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Staff writers Walter F. Roche Jr. and Mary Curtius in Washington and researchers Mark Madden in Washington and Janet Lundblad in Los Angeles contributed to this report. Tempest reported from Sacramento.
Political Payrolls Include Families
Dozens of members of Congress have paid relatives for campaign work, records show. The practice, though legal, is coming under scrutiny.
By Richard Simon, Chuck Neubauer and Rone Tempest
Times Staff Writers
April 14, 2005
WASHINGTON — At least 39 members of Congress have engaged in the controversial practice of paying their spouses, children or other relatives out of campaign funds, or have hired companies in which a family member had a financial interest, records and interviews show.
House campaign funds have paid more than $3 million to lawmakers' relatives over the last two election cycles, records show.
The practice is not illegal but has come under new scrutiny following reports that House Majority Leader Tom DeLay's wife and daughter had received hundreds of thousands of dollars since 2001 from his political action and congressional campaign committees. It also comes after disclosures that relatives of members of Congress have been hired by special interests as lobbyists or consultants.
Lawmakers are barred from putting relatives on their congressional payrolls, but they can pay them to work on their campaigns as long as the family member does bona fide work and isn't paid significantly more than the market rate.
The bipartisan practice has been increasingly criticized by government watchdogs and members of Congress.
"Instinctively, it doesn't pass the smell test for me, and I don't think it would for my constituents," said Rep. Ray LaHood (R-Ill.). LaHood said he had never employed relatives and thought the practice was wrong.
"Public service should not be a way to build a family fortune," said Celia Wexler, vice president for advocacy at Common Cause.
Many lawmakers who have hired relatives say their motivation is confidence, not profit.
"I need a campaign manager I can trust," said Rep. Dana Rohrabacher (R-Huntington Beach), whose wife, Rhonda, is now paid $40,000 a year to run his campaign. Over the last four years, she has received $114,894, records show.
DeLay, a Texas Republican, has defended the payments to his wife, Christine, and his daughter, Danielle DeLay Ferro, saying his family members provided valuable service to his campaign. They received $473,801 over the last two election cycles, records show.
His daughter has managed some of his recent congressional campaigns and has worked as a fundraiser for his political action committee, and his wife provides "strategic guidance" for the political action committee.
The Times developed a list of names of relatives and businesses owned by relatives on campaign payrolls from interviews, news accounts and personal financial disclosure reports. Campaign reports do not have to disclose whether recipients of funds are related to a candidate, so The Times' list is most likely incomplete.
The Times analyzed Federal Election Commission data compiled by the Center for Responsive Politics, a nonprofit, nonpartisan organization that researches campaign finance issues. The analysis, which covered 2001 through 2004, did not include such items as reimbursements for travel or other routine campaign expenses.
Among the recipients of the largest payments were members of DeLay's family and those of Rep. Richard W. Pombo (R-Tracy). Pombo paid his wife and brother $357,325 from his political fund over the last four years for duties listed as bookkeeping, fundraising, consulting and other unspecified services, records show.
The amount paid to Pombo's family members in the last election cycle was more than his opponent spent on his entire campaign. Pombo declined to be interviewed.
Including Pombo, five of the top six congressional families in The Times' analysis of two election cycles were Californians. The campaign fund of Rep. Zoe Lofgren (D-San Jose) paid $251,853 to her husband's firm, according to the candidate's campaign filings. She was followed by Rep. Howard L. Berman (D-North Hollywood), $205,500; Rep. Bob Filner (D-San Diego), $154,504; and Rep. Howard P. "Buck" McKeon (R-Santa Clarita), $152,362.
Altogether, at least 10 lawmakers in the 53-member California House delegation have hired family members, according to records and interviews.
Rep. Pete Stark (D-Hayward) paid his wife, Deborah, $119,000 from his campaign fund over the last four years to serve as his campaign manager, records show. In the last election, she earned $2,400 a month as campaign manager and was awarded a $2,400 bonus.
"It's just a matter of paying her for the professional job she was doing," Stark said.
In addition, Sen. Barbara Boxer (D-Calif.) paid her son, a lawyer, $130,000 over four years to run her political action committee, according to her campaign filings.
A spokesman for Sen. Dianne Feinstein (D-Calif.) said that she had not put family members on the campaign payroll.
No computer database was available to allow for a comprehensive search of Senate campaign expenditure records.
In the case of Pombo, 44, politics has been a family affair since the former ranch hand, butcher and truck driver first ran for Congress.
Beginning with his first House race in 1991, Pombo's younger brother Randy has been his campaign manager and treasurer. Another younger sibling, Ray, sometimes catered the congressman's tri-tip and oysters barbecue fundraisers.
In the early years, wife Annette remained in the background, managing the couple's Tracy household, raising their three children and contributing a recipe for Apple Walnut Crisscross Pie to her husband's official website.
But by March 2003, Annette, a Tracy High School valedictorian who has a degree from Loyola Marymount University, had joined the campaign. She was paid $85,275 for her work over the last two years, records show.
Randy Pombo has been paid $272,050 in the last four years, records show.
In the 2003-04 campaign cycle, Pombo paid more to his family members — $217,000 — than his opponent, Jerry McNerney, spent on his campaign. McNerney, a Pleasanton mathematician, spent $154,677. He lost to Pombo 61% to 39%.
Wayne Johnson, a partner in the Sacramento political consulting firm JohnsonClark Associates, which also worked for Pombo, described a family-run campaign operation.
"Randy has been there from the beginning, back when they were bootstrapping everything and Richard, who was then a Tracy city councilman, was not even expected to make it out of the primary," Johnson said. "And I know that when you called down there during the last campaign season, Annette was the one answering the phone."
Lawmakers offer a variety of reasons for putting family members on the campaign payroll.
Rep. Ron Lewis (R-Ky.), whose wife, Kayi, receives $40,000 a year from the congressman's campaign fund to serve as his campaign manager, acknowledged being "very nervous about appearances." But he said he would "rather run the risk of a bad appearance than to have somebody steal all my money or to have some errors [in campaign finance reports] costing me big fines."
Boxer said that she had heard horror stories from colleagues about campaign workers who had absconded with funds, and she knew that she would never have that problem if she put her son, Doug, in charge.
Boxer added that she turned to her son because he was the most qualified candidate. "Who is the best person to run your operation — that's the key thing to me," she said.
Several lawmakers said the family members they hired were professional consultants who had worked for other candidates. And, they said, they often obtained services at bargain prices.
"My wife did this for many years before she worked on our campaign," said Filner, whose wife Jane's company, Campaign Resources, was paid $154,504 in campaign funds during the last two election cycles.
Berman's campaign paid $205,500 to two firms headed by his brother Michael, a longtime campaign consultant, over the four-year period. The congressman said he thought the payments included debts he carried over from his 1998 and 2002 campaigns.
"The good news for me is that one of the most talented campaign strategists happens to be my brother," Berman said.
Berman, a former member of the House ethics committee, said that according to the chamber's rules, "you are not supposed to use your campaign funds for personal expenses or matters unrelated to politics. The test is what kind of work they are performing. I'm getting one of the most talented campaign strategists at a pretty good price. Out on the commercial marketplace, my brother makes a lot more money."
Lofgren's campaign paid her husband's company, Collins Day, $251,853 during the four-year period for fundraising, filing campaign finance reports and other political activities.
Lofgren noted that Collins Day also worked for other politicians.
"It's really important that [campaign finance reports] be done right," Lofgren said. She joked that when she was a county supervisor, her husband did the work as a volunteer — "and it was always late." Now that she pays his company, she said, "it gets done."
Rep. Elton Gallegly (R-Simi Valley) said his wife, Janice, worked as an unpaid volunteer for his campaign for 18 years before she began receiving $2,600 a month last year for tasks such as keeping the campaign books. He said her compensation was far less than what she made before giving up her job as an escrow officer to work on the campaign. She has been paid a total of $28,636, records show.
"She's always been an independent woman," Gallegly said. "So it was at my suggestion that she get some kind of compensation so she wouldn't have to come to me every time she wanted to buy something for one of the grandkids. If you average it over 18 years, she's made about $140 a month."
A spokesman for McKeon said the congressman's wife, Patricia, was a "valuable part of the congressman's campaign team" who ran the campaign office, filed campaign finance reports and oversaw all of the congressman's fundraising. Records show she was paid $152,362 over four years by McKeon's campaign committee.
"There is no one who the congressman trusts more," the spokesman said, noting that McKeon's wife worked on the congressman's campaign without pay for seven years.
Opinions vary on whether hiring relatives is appropriate and ethical.
Kenneth Gross, a former chief of enforcement at the FEC, said, "When you're in a high position, so many people are trying to get a piece of you that sometimes you have to retreat to family as among the few people who you really, truly can trust — who you believe have only your best interest in mind."
As long as a family member is performing legitimate campaign work and payments are disclosed, "there certainly shouldn't be any rule against it," said Gross, a Washington lawyer.
Fred Wertheimer, president of Democracy 21, a campaign finance watchdog group in Washington, said the practice should be prohibited. Campaign payments to family members could potentially become a way to get around the ban on the personal use of political funds, he said.
"In many races for Congress, there is no serious opposition, and members build up substantial war chests that can easily lead to the temptation to start making payments to family members, which can in effect become payments … to the benefit of members themselves," he said. "This kind of activity does create problems in terms of public perceptions. It does create the potential for self-dealing."
FEC regulations permit salary payments to family members for "bona fide, campaign-related services," according to a 2001 advisory opinion issued to Rep. Jesse L. Jackson Jr. (D-Ill.). Jackson had asked the commission whether he could hire his wife, Sandi, as a paid campaign consultant.
"Any salary in excess of fair market value of the services provided is personal use," the opinion said, noting that it was illegal for candidates to use campaign funds for personal use.
There is one complaint before the FEC about a member of Congress paying relatives for campaign work.
The Colorado Democratic Party filed a complaint against former Rep. Scott McInnis (R-Colo.) last year questioning McInnis' payment of $39,000 to his wife, Lori, from his congressional campaign committee after he announced he would not be seeking reelection. Democrats labeled the payments excessive and "unseemly."
McInnis said that the payments to his wife were legitimate and complied with FEC rules. He said a response to the complaint had been filed with the FEC.
"Her work is public and all her payments are public," McInnis said, adding that his wife's salary had been based on the pay scale for congressional employees with similar responsibilities. "She ran the campaign with an iron fist."
Rep. Ralph M. Hall (R-Texas), whose political committee paid his daughter-in-law Jody $123,761 for the last two campaigns, said, "I don't see anything wrong with it if she's doing real work for real pay."
*
ON THE WEB
Previous stories on the practice of hiring lawmakers' family members can be found at latimes.com/lawmakers.
*
Staff writers Walter F. Roche Jr. and Mary Curtius in Washington and researchers Mark Madden in Washington and Janet Lundblad in Los Angeles contributed to this report. Tempest reported from Sacramento.