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15 Months and 15,000 Words Later, Boosters Still Obscure the Timeline on the Steele Dossier

Jane Mayer is a great journalist. But in a 15,000 word profile on Christopher Steele and his dossier, she adds just two new bits of news, and along the way muddles the timeline as badly as all the Steele boosters who have gone before her.

The Singer feint

Mayer emphasizes something that Democrats have: that the Fusion project on Trump was initiated by right wing billionaire Paul Singer, not the Democrats.

[I]n the spring of 2016, Steele got a call from Glenn Simpson, a former investigative reporter for the Wall Street Journal who, in 2011, had left journalism to co-found Fusion GPS. Simpson was hoping that Steele could help Fusion follow some difficult leads on Trump’s ties to Russia. Simpson said that he was working for a law firm, but didn’t name the ultimate client.

The funding for the project originally came from an organization financed by the New York investor Paul Singer, a Republican who disliked Trump. But, after it became clear that Trump would win the Republican nomination, Singer dropped out. At that point, Fusion persuaded Marc Elias, the general counsel for the Clinton campaign, to subsidize the unfinished research. This bipartisan funding history belies the argument that the research was corrupted by its sponsorship. [my emphasis]

This is misleading, of course, as is Mayer’s use of the term “spring.” That’s because, as least according to the public record, Steele wasn’t brought on to the project until after Democrats started funding the dossier. Yes, Singer started funding the oppo research on Trump, but not the paid HUMINT that got leaked in early 2017.

The continued silence about Guccifer 2.0

One reason all this matters is because of the way Mayer ignores the same thing every other Steele booster did: the release of Democratic documents by Guccifer 2.0 on June 15. Mayer, like all the other boosters, jumps immediately from the (erroneous) WaPo reporting on the DNC hack to the WikiLeaks release.

On June 14, 2016, five days after the Trump Tower meeting, the Washington Post broke the news that the Russians were believed to have hacked into the Democratic National Committee’s e-mail system. The first reports were remarkably blasé. D.N.C. officials admitted that they had learned about the hack months earlier. (It later surfaced that in November of 2014 Dutch intelligence officials had provided U.S. authorities with evidence that the Russians had broken into the Democratic Party’s computer system. U.S. officials reportedly thanked the Dutch for the tip, sending cake and flowers, but took little action.) When the infiltration of the D.N.C. finally became public, various officials were quoted as saying that the Russians were always trying to penetrate U.S. government systems, and were likely just trying to understand American politics better.

The attitudes of Democratic officials changed drastically when, three days before the start of the Democratic National Convention in Philadelphia, WikiLeaks dumped twenty thousand stolen D.N.C. e-mails onto the Internet. The e-mails had been weaponized: what had seemed a passive form of spying was now “an active measure,” in the parlance of espionage.

As I’ve noted, repeatedly, the first Steele report, dated June 20 and so completed on the same day Guccifer 2.0 promised to release a “dossier” of his own on Clinton, describes the dirt Russians were peddling as old FSB intercepts, not recent hacked emails. The Steele report remained way behind public contemporaneous reporting on the hack-and-leak, and by jumping right to Wikileaks, boosters avoid dealing with several more reports that conflicted with known public facts.

So Guccifer 2.0 not only proves Steele’s sources were at best misinformed about the operation against Clinton and possibly even peddling disinformation, but — particularly given Simpson’s assertion that the Democrats were using the dossier to “understand what the heck was going on” it might have led Democrats to be complacent as they considered how to respond to the DNC hack.

The continued silence about precisely when Simpson hired Steele

The timing about when in “spring” Simpson hired Steele matters for one more reason. As I laid out here, Perkins Coie’s hiring of Simpson closely coincides with the time Perkins Coie and their clients, the Democrats, met with the FBI on the hack and asked for, but did not get, a public announcement about Russia being the culprit. But we don’t know which came first and what relationship there was between them (though Simpson seems to suggest there was one).

Given how many pieces relying on Simpson and the Democrats as sources we’ve seen, the continued inability to nail down which came first, the FBI refusal to attribute the hack or the hiring of Steele, is notable.

When a misleading “spring” turns into a misleading “late summer”

Perhaps the most remarkable move in this piece comes with Mayer’s claim (after admitting that she was among the reporters who got briefed by Steele in “late summer”) that no news outlet reported based off Steele’s allegations.

In late summer, Fusion set up a series of meetings, at the Tabard Inn, in Washington, between Steele and a handful of national-security reporters. These encounters were surely sanctioned in some way by Fusion’s client, the Clinton campaign. The sessions were off the record, but because Steele has since disclosed having participated in them I can confirm that I attended one of them. Despite Steele’s generally cool manner, he seemed distraught about the Russians’ role in the election. He did not distribute his dossier, provided no documentary evidence, and was so careful about guarding his sources that there was virtually no way to follow up. At the time, neither The New Yorker nor any other news organization ran a story about the allegations.

Unless she is playing word games here (perhaps meaning “allegations” to refer exclusively to the pee tape), it’s mindboggling she made this claim. A key part of the debate over the Nunes memo in the last month (she makes reference to the Schiff memo, so she has to be aware of this) is about what Michael Isikoff’s September 23 article — which itself relied on Steele’s reporting — is doing in the FBI’s application for a FISA order on Carter Page. Isikoff first admitted his reporting relied on Steele days after the dossier was leaked. In the wake of the Nunes memo release, Isikoff admitted that in even more detail.

Mayer’s quasi bombshell

Which brings us to one of the two new pieces of news. Mayer reports on an additional report Steele did in late November that reports a MFA claim that Russia vetoed Mitt Romney as Secretary of State.

One subject that Steele is believed to have discussed with Mueller’s investigators is a memo that he wrote in late November, 2016, after his contract with Fusion had ended. This memo, which did not surface publicly with the others, is shorter than the rest, and is based on one source, described as “a senior Russian official.” The official said that he was merely relaying talk circulating in the Russian Ministry of Foreign Affairs, but what he’d heard was astonishing: people were saying that the Kremlin had intervened to block Trump’s initial choice for Secretary of State, Mitt Romney. (During Romney’s run for the White House in 2012, he was notably hawkish on Russia, calling it the single greatest threat to the U.S.) The memo said that the Kremlin, through unspecified channels, had asked Trump to appoint someone who would be prepared to lift Ukraine-related sanctions, and who would coöperate on security issues of interest to Russia, such as the conflict in Syria. If what the source heard was true, then a foreign power was exercising pivotal influence over U.S. foreign policy—and an incoming President.

Mayer goes on to raise reasons to doubt the credibility of this report — not least, that Trump never liked Romney (and especially had it in for Mormons in the wake of the election, when Mormons were among the most vocal opponents to Trump) — but she presents them as details that might corroborate the report.

As fantastical as the memo sounds, subsequent events could be said to support it. In a humiliating public spectacle, Trump dangled the post before Romney until early December, then rejected him. There are plenty of domestic political reasons that Trump may have turned against Romney. Trump loyalists, for instance, noted Romney’s public opposition to Trump during the campaign. Roger Stone, the longtime Trump aide, has suggested that Trump was vengefully tormenting Romney, and had never seriously considered him. (Romney declined to comment. The White House said that he was never a first choice for the role and declined to comment about any communications that the Trump team may have had with Russia on the subject.) In any case, on December 13, 2016, Trump gave Rex Tillerson, the C.E.O. of ExxonMobil, the job. The choice was a surprise to most, and a happy one in Moscow, because Tillerson’s business ties with the Kremlin were long-standing and warm. (In 2011, he brokered a historic partnership between ExxonMobil and Rosneft.) After the election, Congress imposed additional sanctions on Russia, in retaliation for its interference, but Trump and Tillerson have resisted enacting them.

I’m curious, however, by a bigger question, which first leads me to the other consistent timing issue in Steele booster narratives.

The continued virgin birth of the December 13 report

Mayer tells the standard narrative of how Steele had Sir Andrew Wood brief John McCain on the dossier, which led to David Kramer obtaining it.

The week before Thanksgiving, Wood briefed McCain at the Halifax International Security Forum. McCain was deeply concerned. He asked a former aide, David Kramer, to go to England to meet Steele. Kramer, a Russia expert who had served at the State Department, went over the dossier with Steele for hours. After Kramer promised to share the document only with McCain, Steele arranged for Kramer to receive a copy in Washington. But a former national-security official who spoke with Kramer at the time told me that one of Kramer’s ideas was to have McCain confront Trump with the evidence, in the hope that Trump would resign. “He would tell Trump, ‘The Russians have got you,’ ” the former official told me. (A lawyer for Kramer maintains that Kramer never considered getting Trump to resign and never promised to show the dossier only to McCain.) Ultimately, though, McCain and Kramer agreed that McCain should take the dossier to the head of the F.B.I. On December 9th, McCain handed Comey a copy of the dossier. The meeting lasted less than ten minutes, because, to McCain’s surprise, the F.B.I. had possessed a copy since the summer. According to the former national-security official, when Kramer learned about the meeting his reaction was “Shit, if they’ve had it all this time, why didn’t they do something?” Kramer then heard that the dossier was an open secret among journalists, too. He asked, “Is there anyone in Washington who doesn’t know about this?” [my emphasis]

After including the denial that Kramer promised exclusivity to McCain (bolded above), Mayer lays out what has become the presumptive story on how BuzzFeed got the dossier, from Kramer.

By a process of elimination, speculation has centered on McCain’s aide, Kramer, who has not responded to inquiries about it, and whose congressional testimony is sealed.

Except all that would support Kramer leaking a dossier in its December 9 form, not a dosser in its December 13 form, which is what we got.

The question is all the more pressing, because we now know that there’s another version of the dossier, one that might include the late November report but not (yet) the December 13 report, which may be how the FBI obtained it.

The other scoop: a different murder?

So there are two scoops: the report that Russian chatter took credit for Trump humiliating Mitt Romney, which might be true (in spite of all the reasons to believe it’s not), or might instead be more disinformation, in this case disinformation that served Russian bureaucrats’ self-interest in looking good for Putin.

The other scoop is that, while Mayer notes there is no evidence that Oleg Erovinkin was a Steele source, there may be another death that Mueller is investigating in relation to the dossier.

No evidence has emerged that Erovinkin was a Steele source, and in fact Special Counsel Mueller is believed to be investigating a different death that is possibly related to the dossier.

None of the two known potentially suspicious American deaths, that of Seth Rich or Peter Smith, would seem to match the dossier timeline. There are, however, a few other Russians that might be potentially related deaths.

I’d love to see a 15,000 word piece that finally answers some of these questions about the dossier. But for now we’ve just got my neverending pieces asking the questions.

When Trump Brought Romney To Heel, or Further Adventures in the Cabinet of Deplorables

trump-romney-carKarma is a bitch, or so it is said. I think it is currently. Back in the day, Mittens was famous for being such a cheapskate cheeseball (yeah, despite the car elevator, which seems quaint now compared to Trump’s ostentatiousness) that he loaded the family dog into a small box coffin mounted to the top of the family station wagon to go on family vacations.

The dog was named Seamus, Mittens was an anus, and the incident became famous. But the long ago incident dogged Romney in the 2012 election. Sometimes, things come back to bite you in the ass.

Welp, here we are deep in 2016 and that dog bites Mitten man story is back. Romney, who seems a decent chap in relation to the current Cabinet of Deplorables under consideration by Team Transition Trump, is suddenly – supposedly – under consideration for a Cabinet post. Reportedly the Secretary of State slot, but possibly others as well.

But, wait, is Mitt Romney on the Trump Christmas Card List, much less cabinet appointment list?

Seems hard to square since Mittens was there ripping the Donald a new anus as recently as last March. But that was then, and this is now. And…..now…..the major media is all agog that the Trumpeter could be soooo rational and awesome as to be assembling the vaunted “Team of Rivals”. Here is everybody’s favorite Mark Halperin replacement stooge, Chris Cillizza of WaPo’s “The Fix”, milking the mad cow for every drop he can:

Again, this would, largely, run counter to how Trump ran his presidential campaign. But that would also make picking Romney all the more powerful a symbol. Campaigns are one thing, Trump would be saying, but being president is another. I want to be surrounded by the best people for the job — no matter what we said about each other in the past.

This is, of course, the whole “Team of Rivals” concept that garnered President Obama so much good press in his own transition period back in late 2008. Trump has further to go — a lot further to go — than Obama did to heal the rifts within his own party and answer doubts about his readiness to do the job to which he was elected. But the Romney meeting is a step in the right direction. Getting Romney to sign on would be an even bigger one.

This is, of course, a boatload of steaming shit. Hey, it is the Cillizza Fix, what did you expect? There are a plethora of others in the major media, including cable, deep diving into the same ridiculous bunk.

Take a look at who Trump has signed on to officially so far for his chosen team: Mike Flynn, Jefferson Beauregard Sessions, Steve Bannon. Notice anything in common there? Perhaps near insane levels of bigotry, hatred and ostracization of others? Gannon may seem the most inert, but that is wrong, he is just the least known outside of the annals of white neo-Nazi Breitbart nationalism. But they are all of a core.

So, let us be honest, will the Senate Judiciary Committee put up any real roadblock to a dyed in the wool unreconstructed racist like Jeff Sessions? Hahahaha, no, of course not. Republicans own the SJC, and even the Dems will ultimately give in to Sessions’ nomination. They will put up a nominal “stern questioning” as DiFi has already so gallantly promised, and then they will cave completely.

Will discerning Republicans with morals object to Sessions’ nomination? Hell no. The single most quirky and sometimes actually moral GOP member of SJC, Jeff Flake, has already strongly and early come out in favor of Beauregard’s nomination. If you know SJC, this is over, and welcome to unreconstructed racist Jeffrey Beauregard Sessions as AG.

The point is that Trump is the racist bigot he has always promised to be. Do NOT buy in to the cloying clickbait rationalizing and normalizing pablum of the main and cable media. They already know they are under siege from Trump, and are already cowering in the midst. The media we ought be able to count on are already “asking questions” about what they will do, while they do nothing to stop the nonsense. It is already a stunning abdication, as if the performance during the election were not proof enough.

So, what does Trump’s meeting with Mitt Romney Saturday really mean?

That Trump is reasonable and might let Mittens, who insulted the hell out of Trump not long ago, be one of his key Cabinet members?

cxla1tsveaap5kiHahahaha, no. Don’t be foolish. This is a staged clownshow for the idiot media who, of course, are lapping it up. Secretary of State for Mittens? Hahahahaha, not likely, Trump is not that gracious, forgiving or intelligent. Heck, Mittens had to carry his own shoes through TSA, all by himself. If the Trumpalo wants you, that is not how it happens.

No, what is going on here is that Trump is bringing Romney, who insulted him and disrespected him, to heel. Like a dog. Chris Christie, who supplicated and humiliated himself over the better part of a year to support Trump, was sent packing like he had the plague. That was only because Christie had slighted the son-in-law’s father in the past.

Romney fired all his guns in anger in a direct broadside against Trump himself. Sure, yep, totally, Trump will now make Mittens Secretary of State.

Probably ought roll with that meme media members. Uh huh. Trump is taking you, and Mittens, on a ride if you think Romney is getting any significant policy post like SOS. Nope. Oh, but the way, Ted Cruz isn’t either. Give it a rest.

[The graphic at the top, which is totally awesome, is by the one and only TWolf, our friend for a long time. Follow Tom at @twolf10]

Mirror Mirror and His Wall

I think I’m going to have to write a daily piece on how frantic insiders trying to squelch the populism of this year’s election (Trump, especially, but also Bernie) are, at the same time, revealing a delusional lack of self-awareness.

Today, for example, Mitt Romney will make a speech in which he will call Donald Trump phony.

And Wall Street will spend unlimited amounts of money to warn that Trump — as opposed to their own reckless practices and abuse of oligarchical position — will doom the economy.

The pitch to Wall Street titans and other CEOs is that a President Trump would be disastrous for markets and the economy. Many economists say that if the U.S. were to deport 11 million undocumented immigrants in a single year, the immediate hit to gross domestic product would lead to a depression. And slapping massive tariffs on goods from Mexico and China could dramatically increase prices for U.S. consumers and create destabilizing trade wars. “The most important thing about Trump is, he is completely unpredictable and volatile, and the one thing business needs is predictability,” [GOP strategist Katie] Packer said.

Perhaps most remarkable are the bunch of Neocons who signed a letter calling Trump dangerous. In it, some of the signers who have, in the past, argued for ticking time bomb use of coercive interrogation, here call the “expansive use of torture is inexcusable.” The guy who oversaw our last effort to build a wall signed the letter complaining that asking Mexico to pay for one “inflames unhelpful passions.” A slew of past servants to the Saudi family and other vicious dictators complain about Trump’s admiration for foreign dictators (in this case, the democratically elected thug Vladimir Putin). The author of the 16 words in Bush’s 2003 State of the Union complains that Trump is “fundamentally dishonest.” And a bunch of people who worked closely with Dick Cheney as he shredded the Constitution (and at least one of whom helped make legal arguments to do so) worry that Trump’s “expansive view of how presidential power should be wielded against his detractors poses a distinct threat to civil liberty in the United States.”

I mean, all this Sturm und Drang about Trump is nice, but maybe these folks should clean up their own act first?

Missing White Women

There are several interesting pieces of analysis cementing the logic that Obama won and Republicans will continue to lose because there simply aren’t that many angry old white men anymore. The WSJ surveys the demographic trends–including the most interesting one, showing Asian voters favoring Obama at almost the same high percentages as Latinos.

The Romney campaign devoted attention to Asian voters, particularly in northern Virginia. Exit polls showed the Asian vote expanding to 3% of the total U.S. electorate—an all-time high—with 75% of those votes cast for Mr. Obama.

And Alec McGillis suggests that Rick Perry’s challenge, which forced Mitt to the right of him on immigration–may have cast the lethal demographic blow against Mitt’s campaign.

 Sure, he wasn’t considered the sharpest pitchfork in the barn, but he had never lost an election and, with his brief flirtation with secession, had tapped into the anti-Washington fervor of the moment far better than any other Republican in the field. Premier national political magazines dispatched reporters to dolong profiles of him. And the frontrunner for the Republican nomination fatefully decided that Perry was such a threat to his prospects that he would … try to destroy him by running to his right on immigration.

Mitt Romney repeatedly attacked Perry for his support of in-state tuition for undocumented students at Texas colleges, declaring at one debate that it “made no sense at all” and running what was probably the nastiest ad of the primaries, a Web ad (since disappeared) that concluded with a clip of former Mexican president Vincente Fox praising Perry, as if that in and of itself was disqualifying.

[snip]

It was left to Perry to utter the defense that arguably sealed his fate even before his debate snafu: “If you say we should not educate children who come into our state … by no fault of their own, I don’t think you have a heart.”

But even as Romney was glorying in the move, its risks were plain to see. After vanquishing his foes amid a virtually all-white primary electorate, Romney was going to face a general election in which he could not afford to do worse than John McCain had with Hispanics—a 32 percent share. His harsh rhetoric was, for many voters, going to be inextricable with the litany of Republican callousness on the issue—Tom TancredoMaricopa County Sherrif Joe Arpaio,Arizona’s draconian anti-illegal immigration law and its copycats in Alabama and elsewhere, and on and on. Hispanic Republicans warned Romney to cool it, but he blustered on.

But one of the most interesting demographic pieces comes from Sean Trende at RealClearPolitics, showing that it wasn’t so much that minorities swamped Mitt, but that white voters turned out at lower rates than in 2008.

If we build in an estimate for the growth of the various voting-age populations over the past four years and assume 55 percent voter turnout, we find ourselves with about 8 million fewer white voters than we would expect given turnout in the 2008 elections and population growth.

Had the same number of white voters cast ballots in 2012 as did in 2008, the 2012 electorate would have been about 74 percent white, 12 percent black, and 9 percent Latino (the same result occurs if you build in expectations for population growth among all these groups). In other words, the reason this electorate looked so different from the 2008 electorate is almost entirely attributable to white voters staying home. Read more

And They’re Off! 4 GOPers Make Bid for 2016 Over Mitt’s Still-Warm Body

I’m not really sure why the pundits are wasting time deciding whether Nate Silver is a wizard or a washed out baseball junky. There’s another fairly clear sign that insiders believe Obama will win this election: the number of 2016 GOP contenders who are shifting into campaign mode.

Chris Christie can be forgiven for boosting up Obama’s image as President the last week of the campaign. After all it makes him look Presidential. More importantly, it’ll ensure NJ gets lots of quick federal attention. (Though it did remind me that Christie used his coming out party at Mitt’s RNC to talk about Chris Christie.)

Jeb! was a bit more circumspect, spending a Mitt campaign appearance bitching that Obama blames his brother for … things his brother did.

“His entire strategy is to blame others — starting with my brother, of course,” Bush said during a campaign rally for Mitt Romney in Coral Gables, Fla. “Basically, he blames every possible thing rather than having the humility to be able to reach out and to find common ground.”

But the most amusing bid for the 2016 front-runner position comes from Paul Ryan’s unnamed backers (though Governor Kasich is quoted by name) inventing reasons why Ryan wouldn’t fulfill the other position he’s running for (Congressman)–including that his newfound popularity would fracture the Republican caucus or that Democrats would make him cast difficult votes. So, these anonymous advisors say, Ryan should instead write a book or become a Professor or lobby or think tank.

Anything for an opportunity to make public use of PowerPoint.

That is why some of Ryan’s biggest boosters are considering whether it wouldn’t be better for Ryan to resign from the House. He could write a book — “saving America” is a theme often bandied about — or teach at a university.

After all, on the campaign trail, Ryan is as much lecturer as campaigner. Aides routinely set up giant video screens so Ryan can use visual aids to walk audiences through the minutiae of budget politics. Graphs and charts are as common as yard signs and American flags at some events, with Ryan settling into his role as explainer in chief.

Yet curiously, those aides mention a 2016 Presidential bid at least 4 [Update–oops! 5] times in the article.

…future President Ryan?

…biding his time until a presidential run of his own.

a leading White House contender in 2016…

…forcing him to take sides on measures that could come back to haunt him during a presidential bid.

Ryan’s allies aren’t ruling out a bid for the top spot for their friend.

5 mentions of the next Presidential cycle, about a guy who’s on the ticket for this cycle.

And finally there’s this “accidental” email sent by Newt’s people:

“The truth is, the next election has already been decided. Obama is going to win. It’s nearly impossible to beat an incumbent president,” advertiser Porter Stansberry wrote in the email to Gingrich supporters. “What’s actually at stake right now is whether or not he will have a third-term.”

You gotta get an early start, I guess, if you’ll be 73 when you run again.

It’s all rather ghoulish, this campaigning to take over Mitt’s position as the party’s standard bearer before the race has even been called.

I don’t feel all that bad for Mitt, though. After all, he has participated in the weird custom of posthumously baptizing people, basically converting people after they’re dead. Republicans, apparently, follow the opposite strategy, burying you while you’re still technically alive.

Why Does Mitt Hate Profit?

[I posted substantially this post yesterday, but the BlogGods ate it along the way. So I’m reposting.]

Along with the deceitful attack on Italians who make better car company owners than GOP Private Equity types and the Lee Iacocca spin, Mitt has rolled out a radio version of attack on the auto bailout. From Greg Sargent, here’s part of the script:

Barack Obama says he saved the auto industry. But for who? Ohio, or China? Under President Obama, GM cut 15,000 American jobs. But they are planning to double the number of cars built in China — which means 15,000 more jobs for China.

And now comes word that Chrysler plans to start making jeeps in — you guessed it — China. What happened to the promises made to autoworkers in Toledo and throughout Ohio — the same hard-working men and women who were told that Obama’s auto bailout would help them?

The ad continues Mitt’s deceptive insinuation that GM and Chrysler aren’t also adding jobs in the US, which they are doing.

But it does something else. It takes a decidedly anti-profit stance.

You see, there are two reasons car companies are so gung-ho to enter (or re-enter, in the case of Jeep) the Chinese market. First, because it’s growing; when I was working in China, auto people considered the rising Chinese middle class to be 300 million–almost an entire US full of population. And most of them were just aspiring to buy their first car. That’s a whole lot of first time car buyers to sell to, as compared to US consumers, who are driving less and replacing their cars at a slower pace given more durable cars.

The other reason to go to China? Profit margins are bigger there than here. When I was in Shanghai in the mid-2000s, the profit margin on Buick Regals was about $2,000, as compared to the roughly $200 profit margin on a similar car here. The margins are closer now (because manufacturing in the US has gotten cheaper and in China has gotten more expensive), but China still offers good profit margins. Selling Buick Regals or Jeeps in China allows GM and Chrysler to accept lower margins on cars here.

By selling high margin cars in China, US companies can be more competitive here, meaning they will be able to expand sales and therefore production here, too.

All this is implicit in Sergio Marchionne’s response to Mitt’s ignorant rantings.

Together, we are working to establish a global enterprise and previously announced our intent to return Jeep production to China, the world’s largest auto market, in order to satisfy local market demand, which would not otherwise be accessible. Chrysler Group is interested in expanding the customer base for our award-winning Jeep vehicles, which can only be done by establishing local production. This will ultimately help bolster the Jeep brand,and solidify the resilience of U.S. jobs.

Marchionne notes 1) you can’t sell in China unless you build in China, 2) selling in China makes the Jeep brand stronger, 3) making the Jeep brand (and its profit margins) stronger makes it easier to keep up US production.

Marchionne’s implicit point should be where this discussion is heading: free trade hasn’t worked out to be fair trade. China–and Japan and Korea–still protect their markets, meaning if you want to sell there, you’ve got to make cars there.

Mitt has promised to get tough on China. But his series of auto ads have made no mention–not a peep!–of how he’ll reverse this practice and make it possible for Jeep to export cars made in Toledo. Indeed, when Obama launched a trade dispute over auto parts in September, Mitt scoffed at the effort (and ignored Obama’s decent and sustained effort launching trade disputes, one of which pertaining to specialty steel recently won at the WTO).

“The president may think that announcing new trade lawsuits less than two months before the election will distract from his record, but American businesses and workers struggling on an uneven playing field know better,” Mr. Romney said in a speech to the Hispanic Chamber of Commerce in Los Angeles.

Mitt Romney wants to attack American companies for going where profits are. And he’s doing so without discussing why that’s necessary.

That makes him neither a tough guy nor a good businessman.

Lee Iacocca: Mitt Will Make It Easier for Auto Companies to Evade Taxes on Cars Built in China

As part of its effort to pretend that Mitt would be good for the auto industry, the campaign had Lee Iacocca sum up why Mitt would be good for the auto industry.

The first paragraph of specifics reads:

When Mitt Romney is president, he will reduce our nation’s corporate tax rate to 25 percent from 35 percent – currently the highest combined tax rate in the industrial world – so that American car companies can compete on a level playing field at home and abroad. He will also stop the extra tax automakers are forced to pay when they want to bring home their profits to reinvest in the United States.  President Obama could have done this the day he took office since his party controlled both houses of Congress, but he chose not to. [my emphasis]

Obama, of course, has a tax credit specifically for manufacturing companies, meaning under Obama the auto companies would pay less than under Mitt.

But the other part–particularly against Mitt’s egregious claims that the auto bailout has helped Chrysler and GM move production overseas–is even more ridiculous.

Iacocca says Mitt would be better for the auto companies because he’d allow the auto companies to repatriate profits from overseas without paying taxes.

But that assumes, of course, they’re making profits overseas. It would mean they were doing precisely the thing Mitt is attacking–moving into new markets, like China.

So on the same day Mitt attacks Chrysler and GM for making and selling cars in China, generating greater profit it can use to support workers here, his campaign sends out a post boasting that Mitt would require Chrysler and GM to contribute less domestically on the profits they made by making and selling cars in China.

 

Italian Automaker Brings about Chrysler Success after GOP Private Equity Failure

I’ve been a bit tardy in responding to Mitt’s latest cynical ploy, to pretend that rather than expanding production and jobs in both OH and MI, Chrysler is outsourcing production to China.

The Detroit News’ David Shepardson has a good fact check on Mitt’s latest ad here. Greg Sargent rounds of OH papers mocking Mitt’s claims here.

But there’s an angle on Mitt’s claims that has been missed. His ad says,

Obama … sold Chrysler to Italians who are going to build Jeeps, in China.

As Shepardson notes, Chrysler used to build Jeeps in China for the Chinese market. Ford builds cars in China for the Chinese market. GM builds cars in China for the Chinese market (GM also exports Chinese-built subcompacts to Latin America). Chrysler’s return to the world’s largest car market is smart business, something any viable global brand needs to do.

If it’s a moral failing for Presidents to preside over private car companies trying to compete in China, then Mitt has a problem with St. Reagan, during whose Administration Jeep first made groundbreaking entries into the Chinese market.

And if Mitt has a problem with Chrysler (or Ford or GM) building cars in China to sell in China, then he had better prepare to get far tougher with China than he has threatened to do so far. China still slaps huge tariffs on cars made outside of the country, so to be viable in the world’s largest automotive market, you have to build in China. That is the crux of the argument American car companies (and Midwestern politicians) have been making for decades: while the US allows imports from all countries, Japan and Korea and now China make it very difficult to export to those countries. This is not fair trade.

But I’m most offended by Mitt’s insinuation that selling Chrysler to an Italian company–he doesn’t mention Fiat by name–was disloyal.

Recall Chrysler’s recent history. Chrysler’s most recent strong point was the early 2000s, when it succeeded in developing nifty (albeit gimmicky) cars with shortened development cycles (think PT Cruiser). But as Daimler took more control over Chrysler, it invested less in the brand. GOP Private Equity firm Cerberus bought its first 80% of the company in 2007 and picked up the rest in 2009.

Cerberus had no intention of bringing Chrysler back to its former strength. Rather, it wanted to strip out the finance side of the company (it was investing in GMAC at the same time) and sell off the rest. But with the impending financial crisis, it never managed to pull off the trick (though it did get a bank bailout in the very last days of the Bush Administration). Meanwhile, it virtually put the Chrysler model development on autopilot while it tried to find a way to cut its losses.

Thus, when it came time for bailouts, there didn’t seem much to bail out at Chrysler. Unlike GM, which really had started making a turnaround, Chrysler had no product in the pipeline to suggest it would be worth bailing out (though it did have a few super efficient factories in the US).

Choosing to bailout Chrysler was the most difficult decision Obama made during the auto bailout. I’m not even sure I would have chosen to bail it out. And it was difficult precisely because a bunch of Republican vulture capitalist types–people like former VP Dan Quayle and former Treasury Secretary John Snow–had stripped the company.

In came Fiat and its Steve Jobs-like CEO Sergio Marchionne. Read more

Provide For the Common Defense or Go Galt?

We awake to a changed and battered country this morning. CNN’s headline at CNN.com currently blares “Millions wake to devastation”, while AP gives us a state-by-state rundown of the effects of Hurricane (and then Superstorm) Sandy. At a time, though, when the natural American response is to help one another, we have perhaps the strongest example of what is at stake next Tuesday as we go to the polls for a Presidential election. Here is Mitt Romney in the Republican debate hosted by CNN:

The idea that an “immoral” FEMA should be disbanded in favor of private sector disaster response did not go over well with the editorial staff of the New York Times. From this morning’s editorial:

Over the last two years, Congressional Republicans have forced a 43 percent reduction in the primary FEMA grants that pay for disaster preparedness. Representatives Paul Ryan, Eric Cantor and other House Republicans have repeatedly tried to refuse FEMA’s budget requests when disasters are more expensive than predicted, or have demanded that other valuable programs be cut to pay for them. The Ryan budget, which Mr. Romney praised as “an excellent piece of work,” would result in severe cutbacks to the agency, as would the Republican-instigated sequester, which would cut disaster relief by 8.2 percent on top of earlier reductions.

Does Mr. Romney really believe that financially strapped states would do a better job than a properly functioning federal agency? Who would make decisions about where to send federal aid? Or perhaps there would be no federal aid, and every state would bear the burden of billions of dollars in damages. After Mr. Romney’s 2011 remarks recirculated on Monday, his nervous campaign announced that he does not want to abolish FEMA, though he still believes states should be in charge of emergency management. Those in Hurricane Sandy’s path are fortunate that, for now, that ideology has not replaced sound policy.

A common refrain for the Galt crew is that they want to go back to the basics of the Constitution. And yet, here is the Preamble:

We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.

The simple truth is that if we wish to provide for the common defense and promote the general welfare in the face of such a huge storm, then a Federal agency coordinating the preparations before the storm and the response afterwards is the most efficient plan. Putting disaster capitalists in charge instead would only lead to many more deaths and huge delays in response times.

As the country responds to this terrible blow from the storm, it is worth considering whether we wish to go back to the ineptitude of the Katrina response (or worse) or if we want to work together for the common defense through a properly funded FEMA.

Only in Florida: Congressman David Rivera Funds Sham Candidate, Faces Ethics Charges, FBI Probe – Doesn’t Resign

Congressman David Rivera, R-FL (aka “The Gangster”), still won’t resign while under FBI investigation for funding a sham candidate and facing eleven ethics charges.

Proving that Florida is the fetid swamp where political rectitude goes to decay and die a foul death, Congressman David Rivera (R-FL) has raised the bar for misdeeds in office without resigning in disgrace.

In late September, Manny Garcia and Marc Caputo of the Miami Herald documented that Rivera had secretly funded a campaign for a sham candidate in the August Democratic primary in Rivera’s Florida district:

Justin Lamar Sternad, whose failed congressional campaign became the subject of a federal grand-jury investigation, has told the FBI that U.S. Rep. David Rivera was secretly behind his run for office, The Miami Herald and El Nuevo Herald have learned.

Sternad, 35, also told authorities that his campaign manager, Ana Sol Alliegro, acted as the conduit between the campaign and Rivera, who allegedly steered unreported cash to the Democrat’s campaign, according to sources familiar with the investigation and records shared with The Herald.

Sternad said Alliegro referred to the congressman by his initials, “D.R.,” and called him by the nickname, “The Gangster.”

On October 1, Garcia and Caputo informed us that the Republican Party in Florida is preparing for two outcomes for Rivera – indictment or a loss:

Bracing for embattled U.S. Rep. David Rivera to be indicted or lose his election, Republicans have started lining up potential successors to regain the seat in 2014 if the congressman’s Democrat opponent defeats him in November.

Rivera has at least become toxic to other Republicans in Florida, but his ties to prominent Florida Republicans are very strong:

Rivera’s closest ally, U.S. Sen. Marco Rubio, has been keeping his distance from Rivera as well. The two remain friends and own a Tallahassee home together that briefly went into foreclosure in 2010 when both former state representatives ran for higher office.

Rivera no longer attends high-profile events with the senator or with presidential candidate Mitt Romney, who held an event in Rivera’s district where the congressman was the only top Republican no-show.

Yup, Rivera is so toxic politically that he can’t even show his face when his closest political ally and the Republican nominee for President are holding a rally in his own district. Even in the face of that reality, Rivera still has not resigned.

So far, even the eleven ethics charges filed against him yesterday still have not pushed him over that final hurdle into resigning:

Already facing FBI probes and a daunting reelection, U.S. Rep. David Rivera was charged Wednesday by state authorities with 11 counts of violating ethics laws for filing bogus financial disclosure forms, misusing campaign funds and concealing a $1 million consulting contract with a Miami gambling business while serving in the state Legislature.

Investigators with the Florida Commission on Ethics found that Rivera’s secret deal to work as a political consultant for the Magic City Casino — formerly the Flagler Dog Track — created a conflict of interest for the lawmaker. The ethics panel also found that the Republican broke state ethics laws by failing to fully disclose his finances from 2005 to 2009.

/snip/

Rivera signed a consulting contract with the Magic City Casino’s owners in 2006 to run a campaign to win voter approval for slot machines at Miami-Dade pari-mutuels. But Rivera had the money from the deal sent to Millennium Marketing, a company founded by his mother and godmother, records show. Rivera then received at least $132,000 back from Millennium — money that Rivera has called loans that did not have to be disclosed.

At least even Republican polls are indicating that Rivera will lose his race by about ten points, so it appears that the voters in Rivera’s district are paying attention. It will be very interesting to see how Rivera reacts once he has been voted out of office and is facing potential criminal charges. Will he turn on his former colleagues? What nuggets could he offer in return for lesser charges?