CAN ROMNEY'S BAIN PAIN GO AWAY?

One really wonders what the Romney camp are thinking. The writing has been on the wall ever since Gingrich labelled him as a vulture venture capitalist. (See Blog 1/13/12 Romney Wounded and Bleeding). At that stage the "Anyone But Romney" mood was the vogue with Romney getting 25% of the Republican Primary vote and consistently running second to the "Anyone but Romney" candidate du jour. Romney had no answer to the Bain attacks then and he has none now


Romney elected to run on his Bain business experience and should have had all the angles covered on his tenure with Bain then and if he didn't he has had over 6 months to get them down pat. Obama has merely taken up where Gingrich, Perry, Santorum et al left off. Obama has even been joined by respected Republican columnists such as George Will and the Republican Governor of Alabama who have all told Romney to produce all the documents being asked of him including his last 12 years tax returns. 

Team Obama have taken a leaf out of the Karl Rove, (Bush's Brain), playbook. They have attacked Romney on his supposed business strength much as George 43 attacked Kerry on his supposed military service strength. The advantage that the Obama team has over Rove is that Rove and the swift boaters largely had to write the narrative about Kerry and then attack it while Romney has created his own narrative. The Obama ad about Romney outsourcing jobs at Bain and investing in tax havens while singing America the Brave is devastating .

ROMNEY NARRATIVE

Romney has maintained that his Bain experience qualifies him to be President. America is in a financial mess and needs a businessman to bail it out. He is a succesful businessman who made pots of money at Bain so he is your man. Q. E. D.

The only problem is that Romney made money for himself mostly at the expense of the American worker and American taxpayer. All team Obama has to do is to detail how he did it. As JAY H. ELL opined in an earlier blog, Romney is a poster child for everything Obama wanted to run against. 

He fired workers and he said he enjoyed firing. The latter in another context but the damage was already done. He has money in tax havens such as the Cayman Islands and Swiss Banks. He paid less tax than most in the middle class. He outsourced jobs oversea. All of this was legitimate and legal, Senator Lindsay Graham, a  Romney defender maintained. "The tax system is there to be gamed". One can hardly as a patriotic American run on "Let's all game the System".


EVERYONE IS ADDING TO THE NARRATIVE


There is a narrative around the narrative on the tax returns. What can there be in them that makes Romney defy the cardinal rule of a cause celebre? - Get the disputed documents as fast as possible and control the damage. Some speculate that it is payments from Bain when he supposedly was no longer working for them. (His retrospective resignation from Bain was hardly a show stopper). Others say there even more "unpatriotic" investments than have been released already.  


Maybe he should have payed more taxes? There is speculation that he used the $35 million spent on the 2008 Presidential Campaign as a tax deduction which would be illegal. Romney made 100's of millions of dollars and maybe every cent was structured in a way to pay as little tax as possible. 


There is a complicated theory put forward by the tax lawyer, Mark Maremont, whereby Romney may have created two types of shares for Bain. He put his potentially highest capital gain shares in his untaxed Retirement Account and the more low risk ones in his ordinary account. (The latter guaranteed that he would never loose on the deal regardless of outcome). So whatever happened he could not loose and if he hit the Jackpot, which he often did, gigantic sums accumulated tax free in his Retirement Account. 


Then there is Joshua Green of Bloomberg Finance who says that maybe Romney lost so much in the crash in 2008 that he carried forward his losses to 2009 and paid NO Federal taxes in that year. This theory has lead to speculation that maybe in that crash he went short on the House mortgages or bet on the bank bail outs cashing in hugely on everyone's misery. 


Whatever the reason(s) Romney appears to be prepared, for the moment, to risk his Presidential chances on not releasing his tax returns. He is defiant. He really should reconsider. I cannot believe that the real story can be as bad as all of this.


So in the teeth of bad unemployment numbers the story is still Romney, his taxes and his version of capitalism.


ROMNEY CAN'T GET OUT OF HIS OWN WAY


Romney insists on defining himself to suit Obama's election manifesto. He attacked Obama for bailing out the motor car industry.  That really doesn't go down too well in the Midwest swing states where the Motor Industry is concentrated.    

Meanwhile Romney squirms and whines. "Obama should fight on the issues not just smear him - Obama should apologize - Romney may have been nominally head and CEO of Bain drawing a salary but wasn't running Bain when the outsourcing occured - John Kerry's wife didn't show her tax returns!" His final stance is that he will not apologize for being a successful business man.  

Obama just ups the ante by maintaining that Romney will create 800,000 jobs if he becomes President  - all outsourced oversea by doing away with the tax on companies' foreign earnings - Romney would not be the Commander in Chief he would be the Outsourcer in Chief.


What is coming up next will be the issue of financial regulation which Obama is "for" and Romney is "against". This has to be a key issue in the light of the unfolding Libor scandal where the unregulated financial institutions once again proved that they need to be regulated. This has the makings of a long long story with mortgages, pension funds, cities and states loosing money while the trusted financial institutions, (the job creators), played monopoly with real property, (other peoples).


There is also in the wings the Ryan budget that Romney has signed onto. That budget is not exactly being trotted out by the Republicans will be introduced by the Obama campaign. As far as they are concerned another gift. For starters it gets rid of Medicare and Medicaid as it exists today.


WHAT HAS ROMNEY GOING FOR HIM?

1. In spite of all of this Romney is still in the game. He is nothing if not resilient and he is not far behind Obama in the national polls.
" It is the economy stupid".


2. Romney has pots and pots of money with which he hopes to drown out the narrative he has created for himself. He has all the so called "interest" and "support" groups that are allowed, anonymously, to spend and collect unlimited sums of money to further his cause. There are endless corporations and institutions who are really Romney's main constituency. They are ready to make the "investment" to continue on in their merry way. Do the Oil Companies, for example, really want to loose their lucrative research and development subsidies?

3. He has history on his side. No incumbent has won reelection with the unemployment number above 8%. Romney is calling Obamacare a tax increase even though he steadfastly maintained that Romneycare wasn't. He thinks that it is a winning issue for him.   

4. The Republican State legislatures are trying to even out the demographic that is working against Romney by changing voter registration laws that will make it harder for the poor, Hispanics and African Americans to vote.

5. He can inspire with his Vice Presidential choice but the odds are he will go true to form and name someone who is a white male lackluster candidate. They keep mentioning Condie Rice who keeps putting the kybosh on the idea. Anyway she is pro choice, like Romney used to be, and he needs that like a hole in his head.       


6. Obama has not exactly a stellar economic record to run on. "Yes We Can" has morphed into "Forward". The starry eyed base is not nearly so worked up. For a large part of his Presidency he tried unsuccessfully to compromise with the Republicans. (See Blog, 12/7/10, "Obama - From "Yes we can" to "Yes we cave"). Obama turned out to be a far more inspiring candidate than he was a President. Such is the reality of politics.


7. At the end of the day Romney will have all the money and that he believes could win it for him. His support groups are said to be buying all the TV time in the swing states for August and October. In fact this has really made team Obama quite agitated and they have been sending out e -mail after email every day pleading for money.

However the debates are usually the most watched adverts and they are for free. Romney was pretty uninspiring in the Republican debates. Here he is up against Obama in an area that is his forte. Also the moderators' questions have to bring up all his narratives again and that cannot be something that he is looking forward to.


Objectively, the Republicans have to be pretty desperate and there are even murmurings that Romney is only the "presumptive" nominee and maybe the convention could pull a rabbit out of the hat. Now that would be a real miracle!




    

PENN STATE - A FAILED STATE

There are so many aspects to the the Penn State University Crisis, where a former football coach has been found guilty of egregious acts of childhood sexual abuse, that one hardly knows where to begin. These aspects include the whole issue of child abuse, the idolatry of sport and the devastation of the victims and the others caught up in the maelstrom of this saga. These issues will be dealt with later. This blog deals with the corrupt inner workings of the University.


A decade and a half after the matter first surfaced at Penn State, The University Board of Trustees initiated an investigation into the whole affair. This was conducted by Louis Freeh, a former FBI Director and gives us insight into the inner workings at Penn State. 


THE POWER OF INSTITUTIONS


The area that JAY H. ELL would like to look at is the incredible power that institutions and corporations wield in the USA. In fact  they are the most powerful political entities in the USA - even more powerful than the States themselves that make up the Federation. Of the institutions the Universities stand out as the most powerful and influential. They are even more powerful than the Medieval Churches of the Middle Ages. 


 Major Universities' total resources and budgets, run into billions -  multiples more than the budgets of US towns of populations of over 200,000. The allegation against these powerful entities is that they are run like banana republics with not even token acknowledgement to the rule of law, due process and the world around them. 


Looking at the comprehensive Freeh report it is patently obvious that Penn State behaved as if they are above the law. This blog will show that Penn State have a history of this autocratic behavior and a previous well publicized incident did nothing to set into motion checks and balances that might have avoided this catastrophe.


FREEH REPORT FINDINGS


1. The highest administrative officials of the University, including the President, ignored the State and Federal Laws regarding the reporting of Child Sexual Abuse. Also they totally ignored the provisions of the Federal Clery Act which lays out the provisions as to what a University has to do in relation to criminal activities on the Campus


2. These selfsame administrative officials ignored their own University Policies for the protection of minors on University Property.


3. While these administrative officials did not report the allegations to the Board of Trustees the Freeh report faults the Board. They are the Body ultimately responsible for the University and did not introduce compulsory policies for the reporting of such incidents to them. The Freeh report further criticizes them for not effecting reasonable oversight.


4. The officials, knowing of the allegations against Sandusky, allowed a situation whereby Sandusky, after retirement, was given open access to the University facilities including locker and shower rooms where he continued to abuse minors. 


5. Not only did these administrative officials not report Sandusky's behavior to authorities, no-one is on record of confronting him with these allegations.


6. Sandusky was inexplicably paid a $168,000 on his retirement. While the investigations into Sandusky were in progress, one of the most famous of the officials at fault, the legendary Chief Football coach, was negotiating a several million dollar retirement package with the other administrative officials.


7. The report details incidents were the University officials were swift to act against those who had been involved in minor incidents that they perceived to be not in the University's "best interests". The purpose of this inclusion was to illustrate the unashamed hypocrisy of the officials.


8. The report also reflects the culture at Penn State where Janitors, aware of Sandusky's behavior, were too frightened to report it as they believed it would lead to their being terminated.


UPSHOT.


The upshot of this outrageous behavior is now public knowledge.  At least a dozen minors were serially sexually abused and raped over at least a decade and a half by Sandusky. This was allowed to happen and even facilitated because these officials were presumably acting in the University's "best interests". It stands to reason that with all the e mails flying around - Freeh's group examined  3.5 million e - mails - that 100's of University officials must of known about it. Yet not a whisper to the authorities as these officials must have believed, like the janitors, that reporting this would be "treason" and not be considered in the Universities "best interests". They obviously perceived they would be fired. 


Hardly a culture conducive to the pursuit of truth.


However, for what it is worth the National Collegiate of Athletic Associates and Department of Education are now in the process of investigating Penn State. Two of the administrative officials have been charged criminally for their failure to report the incidents and other charges may follow. Like all things too late this is far too little.


WATER BUFFALO INCIDENT.


A much publicized incident occured in 1993 at Penn State that should have alerted the Board of Trustees that their top level administrators were out of control. A group of predominantly African American sorority sisters were kicking up a ruckus outside the window of a dormitory were students were studying and sleeping. Several students remonstrated with them some shouting racial epithets. Two of the male remonstrators were charged by the University authorities. One of these was a former yeshiva student, Mr. Eden Jacobowicz. He was charged with racial harassment in that he called the rowdy students Water Buffalo.


 Several expert witnesses testified that the hebrew term Behema was a slang word meaning water buffalo, which was used to describe a rowdy person, but to no avail. This issue dragged on for months garnering national and international attention. The University still arbitrarily found Mr. Jacobowicz guilty of racial harassment in a kangaroo court hearing. His original University appointed advisor told him to except a sentence that included probation and entering the offense into his University record. 


During the process the administrators issued press gag orders and exhibited other autocratic behaviors and after months of one embarrassing exposure after another they finally agreed to withdraw the charges if Jacobowicz apologized to the women. This he did willingly since from the word go he had offered to do so if the term had offended them.


The second student charged was Mr. Jacobowicz's dormitory partner. He was just present when the "offense" took place. He accepted the punishment meted out by the University as he maintained that he could not afford lawyers. After the resolution of Mr. Jacobowicz's case the University was approached to nullify the roommate's conviction. The University flat out refused. 


In their book written in 1999, "The Shadow University: The Betrayal of Liberty on America's Campuses", Alan Kors and Harvey Silverglate detail this and several other instances of this nature in other Universities in the United States.


AFTERMATH OF THE WATER BUFFALO INCIDENT.


The Board of Trustee's silence was loud and clear. 


There was no adverse consequences within the University to any of the officials involved from the President down. At least one of those involved in the Jacobowicz affair was central to yet another University cause celebre. Larry Moneta, a former Vice Provost of Penn State, was slap bang in the middle of the infamous 2006 Duke University Lacrosse case. There several students were arbitrarily suspended on what turned out to be a patently bogus claim of gang rape. Moneta's actions there resulted in litigation against him and the University.


AND ON AND ON IT GOES.....


On Friday 13th July 2012 the Chicago Tribune ran two stories on their front page. They lead with the Freeh report on Penn State. Their second lead was yet another scandal at the University of Illinois where a University Official's husband had been handed a no compete contract of $4.6 million. The mandatory state oversight had been ignored. A member of a watch dog panel maintained that the University of Illinois was acting "above the law". 


In 2009 the University was involved in a widely publicized scandal where it was shown that those with political and university connections were unfairly admitted to the prestigious Urbana - Champagne campus. Disgraced Governor Rod Blagojevitch, The Illinois Senate President, The Illinois House Speaker, the Illinois State Treasurer and several elected Illinois representatives were among those to receive favors. Nearly the whole Board of Trustees resigned as a result. 


There appears no end to it all. A recent book by Benjamin Ginsberg,"The Fall of Faculty : The Rise of The All Administrative University and Why It Matters", goes into endless detail as to how Universities have run amuck. 


Some of the powerful autonomous independent Universities are going the way of all banana republics and have become failed states.