Tuesday, January 17, 2012

Outraged by the Washington corruptocracy? You'd better read this.

At the time of the Anthony Weiner scandal, business magazine columnist, blogger and direct marketing guru Denny Hatch got fed up more than most of us with the way things work in Washington. He wrote the piece that follows, which  I suspect he fleetingly intended for his blog, Denny Hatch's Business Common Sense. (He didn't say that. I infer that.)

Once he got it out of his system, he decided his justifiable fury wasn't right for what he calls his marketing crowd. But he has kindly permitted me to print it here. And that is something I do with cranky pleasure. I do not agree with absolutely everything Denny has to say. Nevertheless, his gist is horrifyingly on target.  Read it and see for yourself. (Fair warning: you may retch at what goes on in Washington.)

The Great Congressional Payola
Anthony Weiner: Casualty of a Crazed, Schizoid Lifestyle
By Denny Hatch
Anthony Weiner’s Judgment
The scandal raises issues that transcend one man's personal indulgence.
In one of the most unbearable news conferences ever seen, Congressman Weiner admitted his week of lies about his lewd online relationships, apologized to all and sundry, but said he will not resign. We'll leave the last point to his constituents, but Mr. Weiner's ambitions to be mayor of New York City are finished and his credibility in national politics after this is next to nothing. . .
     Anthony Weiner now joins a disturbing list of elected officials in our time who've lost any sense of self-discipline. If there are others out there wandering in the confused ethers that trapped Anthony Weiner, we have a request: Get out now. Spare the rest of us.
  The Wall Street Journal, June 7, 2011

Anthony Weiner was best congressional catnip of 2011.

The problem starts with all members of Congress having one single, overarching personal agenda: Get re-elected.

No matter what members of the House and Senate believe in their deep heart’s core, all speeches, votes, interviews, town meetings, confirmation hearings and individual encounters with the media, industry leaders, lobbyists, foreign envoys, voters and members of the executive branch—all must be seen through this prism of desperation for re-election.

Why is nothing is getting done in terms of the deficit, national debt, health care, Middle East wars, Pentagon spending, global warming/environment, and jobs creation?

All 435 house members and 100 senators are terrified of double-crossing the 140 top benefactors—from ActBLue ($52,443,515) and AFSCE ($45,237,515) to Bear Stearns ($3,374,125) and Club for Growth ($1,535,979)—who spread a total of $1.97 billion throughout Congress from 1989-2010.

Follow the Money
“The ideal employee,” said children’s book publisher Franklin Watts, “is one who feels overworked and underpaid.”

Underpaid? Congresspersons are far richer than the electorate.

A few in congress are very, very, very rich. Among them:

Member                                                   Avg. Net Worth
Rep. Darrell Issa (R-CA)         $303,575,011
Rep. Jane Harman (D-CA)         $293,454,761
Sen. John Kerry (D-MA)         $238,812,296
Sen. Mark Warner (D-VA)         $174,385,102
Rep. Jared Polis (D-CA)          $160,909,068
Sen. Herb Kohl (D-WI)         $160,302,011
Rep. Vernan Buchanan (R-FL)         $148,373,160
Rep. Michael McCaul (R-TX)         $137,611,043
Sen. James E. Risch (R-ID)         $109,034,052
Sen. Jay Rockefeller (D-WV)         $  98,832,010
Rep. Nancy Pelosi (D-CA)         $  58,436,537

However, many members of Congress are woefully underpaid and living in financial hell. Base salary is $174,000 per year plus health care, up to 64 round trips home, retirement benefits and a $3000 tax credit on D.C. living quarters.

To Jane and Joe Lunchbucket, this is a lot of money. But for the majority of members—those beyond Virginia and Maryland—it means maintaining a second residence in Washington—the eighth most expensive city in the America. A decent wardrobe is essential. Those members with alimony and a kid in college at $20,000 per semester are gasping for air. Hence the parade of members caught in such no-nos as bribes, money laundering, illegal financial gifts, free plane rides and junkets, and funneling campaign money into personal accounts. Among the recent perpetrators (in alphabetical order):

Barbara-Rose Collins – Randy (Duke) Cunningham – Tom DeLay – Walter Fauntroy - Newt Gingrich – Carroll Hubbard - William J. Jefferson – Buzz Lukens - Nicholas Marvroules - Bob Ney – Carl C. Perkins - Charlie Rangel – Dan Rostenkowski - Rick Renzi - Ted Stevens – Robert Torricelli – Jim Trafficant – William R. Tucker

Last January, CBS News reported that to save money while in Washington, D.C., one-fifth of the House freshmen planned to sleep in their offices. Others that are living away from home share the squalor of dorm-like facilities. From The New York Times, May 30, 1994:

For Representatives Sam Gejdenson of Connecticut, Richard J. Durbin of Illinois, George Miller of California and Charles E. Schumer of Brooklyn, Washington life is not all beer and roses. It's more like beer and frozen soy burgers, stale tortilla chips, lost laundry, monthly trips to Price Club and weekly commutes to their districts and families back home.

Sam cooks, Dick cleans, George collects the rent and Chuck raids the refrigerator. Weeknights, they shoot the breeze in their underwear in the Capitol Hill town house where two of them sleep in unkempt beds in the living room like so many superannuated frat boys, and check to see if anyone they know turns up on "Nightline."

In order to economize on food and drink, many in Congress likely mooch at every public and private buffet breakfast, lunch and dinner to which they can wangle an invitation. At Washington events—with spouses hundreds of miles away and where loneliness and hormones kick in—it’s easy to go from focusing on laws to focusing on attractive singles on the prowl. Hence the plethora of serial infidelities and sex scandals by members that have included (in alphabetical order):

Bob Barr – Larry Craig – John Ensign - Mark Foley – Newt Gingrich – Gary Hart - Henry Hyde – Chris Lee - Bob Livingston – Eric Massa – Jack Ryan – David Vitter – Anthony Weiner             

When members of Congress do return to their districts—where spouses likely must have a job to help meet expenses—they are vilified at town meetings, besieged by jobless constituents whose homes are being foreclosed and are scared to death of having to pay for Obamacare or losing Medicare. This hostile environment is hardly conducive to savoring the comforts of home and conjugal bliss.

Forced to Buy Their Jobs
Imagine not only working for a living, but also having to repurchase your job for millions of dollars every two or six years.

The current average cost of a congressional campaign is $1.3 million. This means the average member of the House must raise $9,000 a week every week during the two-year election cycle in order to stay in office. Once re-elected, the manic scramble for campaign cash starts all over again. This is made complicated by the House Ethics Manual that states:

House rooms and offices are not to be used for events that are campaign or political in nature, such as a meeting on campaign strategy, or a reception for campaign contributors.

With the average senate race costing $7.5 million, each senator must raise $24,000 a week during the six-year cycle. A filthy rich opponent can up the ante exponentially. For example, in the 2010 California senatorial race, former Hewlett-Packard CEO Carly Fiorina spent $21.5 million, forcing her opponent (and winner) Barbara Boxer to raise and spend $29.5 million. 

A senator that needs $29.5 million for a campaign must raise $94,550 a week, every week during the six-year election cycle.

In other words that crucial part of a legislator’s career—campaign strategy, fundraising or talking to contributors—can only be conducted away from the office and out of the building. This means if an urgent call comes in from a top benefactor, the legislator must scurry outside and call back on a cell phone.

The Great Congressional Payola
Payola: The paying of cash or gifts for radio play, and is a combination of the words “pay” and “victrola”, which stands for LP record player.
—Erika Cox
  “Rewind the Fifties”

Payola was a huge scandal that broke in the late 1950s. Record companies bribed radio disc jockeys to play their latest releases over the airwaves causing them to move up the Billboard charts and generate sales. In 1975, United States Attorneys in New York, Newark, Philadelphia and Los Angeles issued 19 indictments—six of them against record company presidents—alleging income tax evasion, fraud and interstate transportation of stolen property.

Now illegal in the entertainment industry, Payola is a way of life in Congress.

Congressional Payola: How It Works
One of the many 800-pound gorillas breaking the financial back of the country is Medicare Part D—prescriptions drugs for seniors. According to Reason’s Nick Gillespie, Medicare Part D will cost taxpayers $62 billion this year.

Unlike the Veterans Administration, which saves an average of 40% on drugs by negotiating for lower costs with the pharmaceutical companies, the Medicare program is forced to pay the full retail rack rate.

If Medicare obtained the same drug prices as the VA, it would save a total of $24.8 billion per year.

This is not a Democratic or Republican or Independent issue. It’s the right thing to do for America—save $billions a year and help trim the deficit.

Since Part D was passed, a small group of senators and representatives routinely introduce a bill enabling Medicare to negotiate with the drug companies.  On January 25, 2011 S. 44: The Medicare Prescription Drug Price Negotiation Act of 2011 was introduced by Sen. Amy Klobuchar (D-MN) and co-sponsored by Mark Begich (D-AK), Richard Blumenthal (D-CT), Dianne Feinstein (D-CA), Daniel Inouye (D-HI), Bernard Sanders (I-VT) and Jeanne Shaheen (D-NH).

According to OpenSecrets.org, not one of these folks received significant—if any—campaign contributions from the Pharmaceutical Industry.

If passed by the senate and the house, the bill would represent a loss to pharmaceutical companies of billions of dollars a year. After being logged in, it was sent to the Senate Finance Committee for action.

The members of that committee received campaign and private PAC contributions of $5,822,782 from the Health Professionals Industry and $3,656,494 from Big Pharma for a grand boondoggle of $9,473,276.

What are the chances of a bill reaching the floor of the Senate that would allow Medicare to negotiate prices with the Pharmaceutical Industry?

Zero. Zip. Nada.

“I seen my opportunities and I took ‘em,” said Tammany Hall politician George Washington Plunkitt ((1842–1924).

“An honest politician is one who, when he is bought, will stay bought,” said Lincoln’s Secretary of War Simon Cameron (1799-1889).

Anthony Weiner—just the latest of a long line of congressional miscreants
Suddenly, in this bizarre and surreal existence that members of Congress endure, Rep. Anthony Weiner went off the rails. The media played his siren song on its 24/7 Mobius loop. The friends, colleagues and punditorcacy wrung their hands, shook their heads in disbelief and called for his ouster. Only his constituents wanted him to stay; according to a Politico.com poll, Weiner garnered a 56% approval rating.

The congressman initiated an aggressive cover up by lying to the media, lying to the public and lying to his colleagues in Congress. Caught in the lies, he tried a “mea culpa” press conference and stonewalling, but the pressure from all sides was too great. He held another press conference and resigned.

“And of course I want to express my gratitude to my family,” he said in closing. “To my mother and father who instilled in me the values that have carried me thus far. . .”

Hustler publisher Larry Flynt shared Weiner’s values and promptly offered him a job at $209,000 plus medical benefits and moving expenses to Los Angeles.

Welcome to Congress, the most do-nothing, duplicitous, dyspeptic and dishonest political culture in the free world.

Takeaways to Consider
*The ideal employee is one that feels overworked and underpaid.”
—Franklin Watts

* Who are the real constituents of Congress? Are they the voters and taxpayers? Or are they the 140 top “heavy hitters”—from ActBLue ($52,443,515) and AFSCE ($45,237,515) to Bear Stearns ($3,374,125) and Club for Growth ($1,535,979)—who spent a total of $1.97 billion buying off Congress from 1989-2010?

* Should not members of Congress be paid a decent wage—say $1 million a year—so they can afford to move their families to D.C? They could also have a life after politics were they to vote for what’s right (rather than what’s profitable) and lose their seats in the process.

* Should not members of Congress be given a free place to live in D.C. just like the president and vice-president?

* “I seen my opportunities and I took ‘em.”
—George Washington Plunkitt ((1842–1924)
  New York Tammany Hall politician

* “An honest politician is one who, when he is bought, will stay bought.”
—Simon Cameron (1799-1889)
  Secretary of War, 1861-1862

* Every time the media cover a member of Congress speaking out or voting on an issue, the related cash gifts to his or her campaign committee should be included in the story as a balance.

* "The American Republic will endure, until politicians realize they can bribe the people with their own money."

Related Websites

Denny Hatch is founder and creator of the monthly blog www.businesscommonsense.com, launched in 2005. A writer, designer and consultant in the field of direct marketing, he is the author of six books on marketing and three novels. Living and working in Philadelphia, Denny can be reached at www.dennyhatch.com or dennyhatch@yahoo.com.

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