Josh Marshall

Josh Marshall is editor and publisher of TalkingPointsMemo.com.

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The story that TPM broke yesterday afternoon (that Judge John D. Bates, has been assigned to hear the Cheney/GAO case) has now been picked up by Dana Milbank at the Washington Post. Don Van Natta's piece in the Times is still, well ... Bates-less.

You heard it here TPM World Exclusive!  You heard it hear first!  Must Credit.first. The all-important Cheney/GAO case has been assigned to Judge John Bates.

Bates is a Bush appointee who was confirmed only on December 11th, 2001. He's considered a moderate Republican.

Carter Phillips of Sidley & Austin has, apparently, been retained by the GAO to argue their case.

Late Update: Judge Bates served as Deputy Independent Counsel under Ken Starr from September 1995 until leaving in March 1997.

That year Bates argued the case in which an appeals court ruled that then-First Lady Hillary Clinton had to turn over notes of conversations about Whitewater.

During that proceedings, in April 1997, Bates told the court "We certainly are investigating individuals, and those individuals -- including Mrs. Clinton -- could be indicted."

Less than a year later, in January 1998, when Starr was coming under fire for partisan bias, Bates told the Washington Post ...

The independent counsel's office has been staffed over the last several years by professional prosecutors with enormous experience who have diligently and properly followed relevant leads in an attempt to discover the truth. These individuals are not partisans who are on a mission but rather professionals who take their jobs and obligations seriously.

The two are far from identical, but it sure will be interesting to see the arguments Bates made about the earlier case of turning over notes.

The Reed-Rove-Bush-Enron Connection: pitiful, but aberrant, embarrassment? Or telling sign of a deeper pattern?

Let's review what we already know.

Back in 1997 Karl Rove recommended Reed for a pricey consulting contract with Enron. According to sources cited in this New York Times article, the idea was to send a lot of money Reed's way -- not from, but in some sense on behalf of Bush 2000 -- so as to keep him in the Bush camp. It seemed like a way for the Bush campaign to keep Reed happy but, shall we say, off the books. You might even call it an outside partnership.

We now know from this more recent article from the Post that Reed was doing what's called 'astroturf' organizing (phony grass-roots activism) for Enron.

This looks at least pretty similar to another set-up Reed had going at about the same time.

Back in 1999 and 2000, I wrote a series of articles on Ralph Reed and Microsoft. At the time Microsoft was working the political system hard to ward off the Justice Department's antitrust suit. That included spreading a lot of money around conservative circles and investing a lot in a possible future Bush presidency.

They also hired Ralph Reed to do astroturf work for them. This was during the same period of time when Reed was some vague sort of 'advisor' to the incipient Bush campaign but not an official consultant.

There's more.

Reed did his work for Microsoft in conjunction with a guy named Tom Synhorst, a phone-bank maven specializing in astroturf work. (Reed and Synhorst were involved in setting up a number of front groups for Microsoft which agitated against the antitrust suit.)

By the time I wrote this article in mid-2000, Reed and Synhorst were also both working for Bush. In fact, back in 1999, they had been getting ready to ambush John McCain on Bush's behalf in South Carolina, as I discussed in this other article.

What's interesting here, however, is the timing. Reed and Synhorst were part of a close-knit group of political advisors working with Rove and Bush as far back as 1997.

Here's what Ceci Connolly said in a profile of Bush in the St. Petersburg Times in May 1997.

Officially, Rove and Bush are thinking no further than 1998. However, it is no secret they talk regularly to prominent strategists such as Iowa's Tom Synhorst, Californian Don Sipple and outgoing Christian Coalition head Ralph Reed. Everyone in the group knows Bush needs a tax cut to compete with the other big-name Republican governors who have led the way.
We know that Rove got Reed the Enron gig in 1997 (mobilizing evangelical revivalism for electricity deregulation) to keep him on ice for Bush. He got his gig with Microsoft in 1998.

Are we talking about a similar set-up here?

More on this tomorrow.

The project that I was referring to in the previous post is this article ("Pacific Whim") which has just been published today in The New Republic.

The article is about Douglas H. Paal, a one-time China policy advisor to George H. W. Bush, who served in the NSC during the first Bush administration. Paal is soon to be appointed to serve as America's de facto Ambassador to Taiwan.

(The United States has not officially recognized the government of Taiwan since 1979. Since then, the American Institute in Taiwan (AIT) has handled America's diplomatic affairs in the island nation. And its Director functions as the United States' de facto ambassador.)

The article discusses certain controversies surrounding Mr. Paal and his appointment.

At various points over the last two months or so, regular readers have written in to ask why the posts didn't seem as regular or as frequent as usual. The answer is that I was working on a big project. It comes out tomorrow.

This Associated Press article describes various notes and letters exchanged between Ken Lay and Clinton Treasury Secretaries Robert Rubin and Lawrence Summers. The Bush administration just released the documents to the AP under a Freedom of Information Act request. The rapid release of these documents is exactly as it should be. But why is it that the Bush administration only seems to understand this principle when it's Clinton administration documents that are in question?

Let's have some fun with the comical Jonathan Snare, shall we?

As you'll see below the appropriately named Snare is the lawyer representing the Texas Republican party in its hopeless, ill-conceived and comical attempt to shut down a satirical website mocking the Texas GOP's connections to Enron.

Well, it turns out you don't have to scratch too far to find out some other entertaining details about our man Snare.

Snare is "Of Counsel" at the San Antonio-based firm of Loeffler, Jonas & Tuggey, a politically-wired Texas law firm. Snare himself works out of the Austin branch.

Now, how about Loeffler? Thomas G. Loeffler?

He did a stint in Congress from 1979 to 1987. But he also turns out to be a close friend and long-time fund-raiser for George W. Bush -- one of the president's "pioneers." In fact, according to this report by Texans for Public Justice, Loeffler was one of the top five individual money-givers to the president out of 212 'pioneers' they looked at. Loeffler was #4 with $495,424 tossed into the pot, just behind #3, Ken Lay, with $574,550.

Really, calling Loeffler and Lay 'pioneers' hardly does them justice. In the effort to open up the GWB frontier, Tom Loeffler was more like the Meriwether Lewis to Ken Lay's William Clark.

(Or maybe Lay is Lewis and Loeffler is Clark? For now, let's say Loeffler is Lewis since we're talking about him. If Lay feels slighted I'd recommend he drop TPM a line here and we'll try to make it up to him.)

From the look of it, Loeffler's forte is fund-raising not in ethics.

Texans for Public Justice says ...

Loeffler also topped a list of five members of Congress whose campaigns received illegal corporate money from Vernon Savings & Loan, which failed at a taxpayer cost of $1.3 billion. A Vernon officer told an ‘89 grand jury that Loeffler offered to set up a meeting with then Treasury Secretary James A. Baker III if they helped pay Loeffler’s debt from a failed ’86 gubernatorial bid. Four Vernon executives then moved $8,000 in laundered corporate money to Loeffler’s campaign, this officer testified, just before federal regulators forced them to resign.
At the moment, he seems well positioned to cash in on the GWB influence-peddling gravy train. His law firm's DC office seems to be a lobby shop. I just hope he sticks to lobbying and stops having his legal goons harass the proprietors of small websites.

A couple days ago we noted the hilariously inept efforts of the Texas Republican party to shut down a parody website satirizing Enron's alleged ownership of the Texas GOP.

We can now bring you a copy of the letter the lawyer for the site's creator sent to the attorney for the Texas GOP on Monday.

February 18, 2002

Mr. Jonathan L. Snare
Loeffler, Jonas & Tuggey, L.L.P.
755 East Mulberry, Suite 200
San Antonio, Texas 78212

RE: Your letter dated February 12, 2002 to Kelly Fero

Dear Mr. Snare:

This firm represents Mr. Kelly Fero in connection with your demand that he shut down his EnronOwnstheGOP website. Apparently, you believe that Mr. Fero is misappropriating the Republican Party of Texas' trademarked elephant.

We specifically deny that the EnronOwnstheGOP website infringes or dilutes any trademark. Our client has a First Amendment right to express his opinion regarding the relationship TPM World Exclusive!  You heard it hear first!  Must Credit.between the Texas Republican Party and the Enron Corporation through a parody of the Party's website. In effectively communicating his message, Mr. Fero also has the right to enlist the aid of the Party's symbol. Using a mark to ridicule what the mark stands for is the type of criticism that has traditionally been afforded both "fair use" and constitutional protection.

Courts around the country have consistently protected persons exercising their right to free speech from trademark claims where the speech involves clear parody. This is particularly true in cases like this, where the speech is noncommercial and constitutes pure political opinion. Additionally, it is inane to suggest that any Texas voters will be confused or misled by our client's website. According to the February 16, 2002 edition of the Fort Worth Star-Telegram, even your client has conceded that voters are highly unlikely to confuse Mr. Fero's website with that of the Texas Republican Party.

Mr. Jonathan L. Snare
February 18, 2002
Page 2

If you pursue this matter, please be assured that your actions will be met with a vigorous response.


Doug W. Ray


Like I said earlier, I'm hoping President Bush taps Jonathan Snare for White House Counsel after Gonzales resigns.

More great moments from the annals of aggressive accounting.

Yesterday's New York Times has an excellent story which I imagine would only have been written in quite this way in the post-Enron era.

The article describes the new hot trend financial advisors are pitching to major corporations. Incorporate a shell parent company in Bermuda and cut your corporate income taxes by millions of dollars.

Here's an example from the article ...

Becoming a Bermuda company is a paper transaction, as easy as securing a mail drop there and paying some fees, while keeping the working headquarters back in the United States.

Bermuda is charging Ingersoll- Rand just $27,653 a year for a move that allows the company to avoid at least $40 million annually in American corporate income taxes.

The company is not required to conduct any meetings in Bermuda and will not even have an office there, said its chief financial officer, David W. Devonshire.

"We just pay a service organization" to accept mail, he said.

How nice for them.

The reaction from the Bush administration is telling.

The White House has said nothing about these moves and their effect on tax revenues. Mark A. Weinberger, chief of tax policy in the Treasury Department, said the moves to Bermuda and other tax havens showed that the American tax system might be driving companies to make such decisions. "We may need to rethink some of our international tax rules that were written 30 years ago when our economy was very different and that now may be impeding the ability of U.S. companies to compete internationally."
Let's focus on the key line here: "the American tax system might be driving companies to make such decisions." This is the rich man's version of the argument which holds that inner-city hoodlums shouldn't be held to account for mugging old ladies because of limited job opportunities in the ghetto and persistent underfunding of Headstart.

This is the sort of story, the sort of muck that could fuel a potent new movement for reform. Not one that would demonize big business as such, but one which would steel our collective resolve that taxes shouldn't simply be a burden which middle-income suckers are forced to pay while big corporations devise clever schemes to dodge them.

This is about equity and patriotism.

If you will entrust me with your hard-earned dollars and contribute them to my campaign, I will use that money to make my case to the voters of our district, to tell a story about the struggles of working families and to enlist a dubious also-ran in the annals of forensic science to exonerate me of any responsibility for the tragic murder of my bosomy young girlfriend ...

Okay, I grant you, that's not an exact quote from Gary Condit. But it seems close to the basic idea.

Frank Bruni's article on Condit in yesterday's New York Times Magazine reports that the soon-to-be-former congressman used $1000 from campaign funds to pay for the private polygraph test which allegedly cleared him of any connection to the disappearance of one-time paramour Chandra Levy.