Dolce, Gabbana and... Rick's Auto Body

There's almost no topic I can't somehow turn into a tirade against some corrupt conservative-- if not Boehner, Cantor, Bachmann Ted Cruz or Miss McConnell then Debbie Wasserman Schultz, Rahm Emanuel, John Barrow or Steve Israel. But we're not going to even try tonight. This post is too important on its own for that; it's about where we spend our money.

After I stopped living in my vehicle-- VW camper vans-- I always bought used Mercury Comets and Ford Fairlanes. Awesome cars. But as soon as they made me president of Reprise, they told me to ditch the Comet and get something "respectable." They expected a Mercedes or better and I decided to at least have a good time with them-- and got a brand new sparkly blue Cadillac. It was so gross. I still wish I had my old Comet... although now I have a Prius. I'll get back to the Prius in a moment. For now I just want to say that I allowed them to make over my car taste and I even bought a bunch of suits and ties-- Zenga, Prada, Paul Smith, Brioni-- but never Dolce & Gabbana. In my mind they made shiny costumes for performers, primarily female, like Madonna. Maybe they were just too arty for me, but there was always something about Dolce & Gabbana that made my skin crawl.

You probably heard that Domenico Dolce and Stefano Gabbana were each sentenced to almost 2 years in prison for doing what wealthy businessmen always try to do-- avoid paying their fair share of taxes. In this case, the two crooks cheated cash-strapped Italy out of at least $1.3 billion by moving around assets to Luxembourg, a pirate state in the middle of Europe that serves absolutely no purpose whatsoever except as a tax haven and a money laundering center for organized crime.

Italy’s prosecutors wanted the stylish pair locked up for a three-year prison term. They got 1 year and 8 months instead. That’s more than a fashion season and a grim prospect for the pair that-- if they can’t beat it on appeal-- will have to leave their nearly 30 year old D&G enterprise for a time. It is sad news if you’re a fashionista.

Much more, it’s a cautionary tale to many high profile businesses and individuals around the world. Taxes are everyone’s business now. The days of a slap on the wrist or a fine may be over even in countries where such activities seemed all but encouraged.

Some would argue that cheating the tax man is nearly a way of life in some locales, and Italy has had its share. Yet despite their repeated protestations of innocence, Judge Antonella Brambilla of Italy found Domenico Dolce and Stefano Gabbana guilty of tax evasion. There were already fines and restitution of a tidy 343.3 million euros.

But the fashion world and financiers were waiting to see if there would be jail time. Surprise, there is. The designers have been sentenced to one year and eight months in jail.

They will surely appeal, and in that sense the case isn’t over. Even more clearly, it won’t be the last legal battle for this kind of case. This one started with the sale of the Dolce & Gabbana label to a Luxembourg-based holding company, Gado. The holding company may have been primarily a tax shelter, and ended up drawing not only the two founders but a number of their colleagues into the fray. However, some of the tax charges were dismissed, including those relating to the valuation of the company at the time of the sale.

Only a year and 8 months? That doesn't seem just-- not when we're talking about that kind of money. I guess it pays to be wealthy. And it's not just Italy. Yesterday a judge in Houston signed off on an agreement to cut Enron crook Jeff Skilling's prison term down to 14 years from 24.

In exchange for his reduced sentence, Mr. Skilling gave up about $42 million, all of which will be distributed to victims of Enron’s fraud. He also agreed not to pursue any further legal appeals, including a claim that would have accused the prosecution team of withholding exculpatory evidence.

...Several Enron victims wrote letters to the court protesting Mr. Skilling’s proposed reduced sentence. On Friday, Andrew Stoltmann, a lawyer who represented several victims, criticized the Justice Department for agreeing to the reduction and said it was unacceptable coming on the heels of the lack of prosecutions arising out of the financial crisis.

“By entering into this early release agreement, a clear message will be sent to corporate C.E.O.’s that if you get caught with the hand in the cookie jar, you will get little more than a slap on the wrist,” Mr. Stoltmann said.

...The fall of Enron, which at its peak was one of the country’s most admired businesses, cost shareholders billions of dollars and employees their retirement savings. Its demise also ushered in a wave of prosecutions that rooted out accounting fraud at once-highflying companies like WorldCom, HealthSouth and Adelphia Communications.

Prosecutors tried Mr. Skilling alongside Kenneth L. Lay, Enron’s chairman, who was also found guilty. But Mr. Lay died a month after the trial, and his conviction was vacated.

Though the corporate accounting scandals of a decade ago have faded from public view, replaced by the financial crisis and insider-trading scandals, the Enron case still has a hold on the white-collar criminal defense world.

In Las Vegas next week, one of the keynote speakers at the annual conference of the Association of Certified Fraud Examiners is Enron’s former chief financial officer, Andrew Fastow, who will speak about his crimes. Mr. Fastow was released from prison in 2011. He received a reduced sentence after pleading guilty and testifying against Mr. Skilling.

It doesn't pay to get involved with these kinds of people-- I mean in a karmic kind of way. Just knowing that someone wears Dolce & Gabbana clothing makes me want to avoid them. Anyway... my Prius. I was parked in front of a friend's house a couple weeks ago and when I went to drive home, I saw someone had sideswiped the rear door and dented it up real bad. The next morning, in the light, I saw that I would have to replace the door. Finding a body shop was a two-week odyssey. Everyone wants to be a junior Dolce and Gabbana or Jeff Skilling. First I called the Toyota dealership where I get the Prius serviced. They don't give estimates on the phone, I was informed. "I just need a rear door for a 2009 white Prius; I'm a regular customer." She said she was sorry and I asked to speak to the manager. He told me the door costs $508. That sounded reasonable. But then it costs $1,500 to install. That didn't sound reasonable. So I started shopping around. I found a place that would do it for $1,800 but everyone was around $2,000. Then I checked Yelp for my area and found one body shop that everyone was raving about, Rick's Body Shop on Hyperion Avenue in Silverlake... less than minutes from my house.

Long story short, they were courteous, well-informed, helpful, patient and they did the job-- and did it perfectly-- for $978 (including tax); they even touched up other dings on the car that had nothing to do with the door. That's what I call a good businessman.

When I was at Reprise I would make a point of being the first one in in the morning and the last one out at night. My car had an assigned spot at the entrance to the company lot. You couldn't come or go without seeing it-- the reason they insisted I get a respectable car instead of the Comet. Turns out the owner of Rick's is also the first one in and the last one out-- my kind of businessman. I hope Dolce and Gabbana lose their appeal and the judge slaps an extra 10 years on each of their sentences.

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Will We Have To Go Back To Drinking Wine Instead of Water Because Of Corporate Pollution?

If you were listening to NPR Saturday, you may have heard their report about water rights in the U.S. "Oil was probably the fluid of last century where there was a lot of turmoil, and I think water is the fluid of this century," explained Michael Walsh, a major general with the U.S. Army Corps of Engineers.

So often, we take water for granted. We turn on the faucet and there it is. We assume it's our right in America to have water. And yet, water is a resource. It's not always where we need it, or there when we need it.

Rivers don't follow political boundaries-- they flow through states and over international borders. And there are endless demands for water: for agriculture, drinking, plumbing, manufacturing, to name just a few. And then there's the ecosystem that depends on water getting downstream.

So what are our legal rights when it comes to water? And who decides?

The NPR report talks about the role of Congress and the U.S. Army Corps of Engineers, municipalities, ranchers, fishermen and American Indian tribes. But they never got around to what trumps all of them: Corporate America, where the bottom line is... the bottom line. Greed and avarice trumps all, especially when you're talking about "the fluid of last century." Tom Kenworthy made the case over the weekend that fracking is already straining U.S. water supplies.

As the level of hydraulic fracturing of oil and gas wells in the United States has intensified in recent years, much of the mounting public concern has centered on fears that underground water supplies could be contaminated with the toxic chemicals used in the well-stimulation technique that cracks rock formations and releases trapped oil and gas. But in some parts of the country, worries are also growing about fracking’s effect on water supply, as the water-intensive process stirs competition for the resources already stretched thin by drought or other factors.

Every fracking job requires 2 million to 4 million gallons of water, according to the Groundwater Protection Council. The Environmental Protection Agency, or EPA, has estimated that the 35,000 oil and gas wells used for fracking consume between 70 billion and 140 billion gallons of water each year. That’s about equal, EPA says, to the water use in 40 to 80 cities with populations of 50,000 people, or one to two cities with a population of 2.5 million each.

Some of the most intensive oil and gas development in the nation is occurring in regions where water is already at a premium. A paper published last month by Ceres, a nonprofit that works on sustainability issues, looked at 25,000 shale oil and shale gas wells in operation and monitored by an industry-tied reporting website called FracFocus.

Ceres found that 47 percent of these wells were in areas “with high or extremely high water stress” because of large withdrawals for use by industry, agriculture, and municipalities. In Colorado, for example, 92 percent of the wells were in extremely high water-stress areas, and in Texas more than half were in high or extremely high water-stress areas.

“Given projected sharp increases in production in the coming years and the potentially intense nature of local water demands, competition and conflicts over water should be a growing concern for companies, policymakers and investors,” the Ceres report concluded. It goes on to say that:

Prolonged drought conditions in many parts of Texas and Colorado last summer created increased competition and conflict between farmers, communities and energy developers, which is only likely to continue. … Even in wetter regions of the northeast United States, dozens of water permits granted to operators had to be withdrawn last summer due to low levels in environmentally vulnerable headwater streams.

Another recent study by the University of Texas looked at past and projected water use for fracking in the Barnett, Eagle Ford, and Haynesville shale plays in Texas, and found that fracking in 2011 was using more than twice as much water in the state as it was three years earlier. In Dimmit County, home to the Eagle Ford shale development in South Texas, fracking accounted for nearly a quarter of overall water consumption in 2011 and is expected to grow to a third in a few years, according to the study.

Moreover, an April report by the Western Organization of Resource Councils found that fracking is using 7 billion gallons of water a year in four western states: Wyoming, Colorado, Montana, and North Dakota. “Fracking’s growing demand for water can threaten availability of water for agriculture and western rural communities,” said Bob Leresche, a Wyoming resident and board member of the group.

...As the Ceres report concludes:

Shale energy development highlights the fact that our water resources were already vulnerable before additional demands were introduced. Regulators, water managers and ultimately all significant economic players who rely on abundant supplies of water must double-down their efforts to better manage this limited and most precious resource.

Worse news: because of the role of money in our politcal system-- i.e., systemic bribery-- those charged with protecting our clean drinking watre supplies (something that basic) have given a green light to Big Oil and Gas to ignore previous clean water regulations and frack away to their hearts' content. I thought this might be a good time to mention the dozen most corrupt Members of Congress in terms of Big Oil shillery. These are the Oil and Gas whores still in Congress who have made sure our watre would be poisoned-- with the amounts they have taken from Big Oil in blatant, legalistic bribes:

• John McCain (R-AZ)- $3,043,404

• John Cornyn (R-TX)- $1,990,350
• Joe Barton (R-TX)- $1,734,255
• Steve Pearce (R-NM)- $1,479,701
• Jim Inhofe (R-OK)- $1,457,696
• Miss McConnell (R-KY)- $1,348,311
• Don Young (R-AK)- $1,193,613
• David Vitter (R-LA)- $1,144,385
• Mary Landrieu (D-LA)- $1,086,084
• Mike Conaway (R-TX)- $942,118
• Pete Sessions (R-TX)- $868,346
• Lord Charles Boustany (R-LA)- $803,655

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Does The Pope Refuse To Live In The Papal Apartments Because He Knows The Curia Will Try To Kill Him?

When the College of Cardinals elects the new Pope, they don't have a magic wand to give him-- and he's stuck with an entrenched, conservative Curia. And like all conservatives-- very corrupt. There's been a lot in the news lately about Pope Francis remarking on the "gay lobby" (or, more accurately, a gay subculture) in the Vatican. That's not really the story though. This week NPR interviewed Robert Mickens, Vatican correspondent for the British Catholic weekly The Tablet, who reminded them that "many of these people in the Vatican that are gay, and even acting out, are extremely conservative. I mean these are not people that want to change the church's teaching on homosexuality-- not at all." Sounds like the U.S. Congress, which is filled with self-loathing closet cases like Lindsey Graham (R-SC), Miss McConnell (R-KY), Trent Franks (R-AZ), Aaron Schock (R-IL), Patrick McHenry (R-NC), etc.

Mickens claims that "the big game is blackmail. It's a mutual recrimination system. That's what is really twisted about the whole thing. I know he is doing this, he knows I'm doing that, checkmate-- and that is how the game works. It's a bad, bad system." Also interviewed for the NPR report, Vatican analyst Marco Politi gets straight to the point: conservatives are corrupt.

The three hot issues in the Vatican Curia are issues about career, about personal ambitions; are issues about money-- which means corruption-- and are issues about sex... There was money laundering through the Vatican bank, money of the mafia. And in same time, in the '90s, there were big amounts of money for bribes for Italian political parties.

...Ezio Mauro, editor-in-chief of the daily La Repubblica, says that by speaking openly of these issues, the pope is trying to counteract mounting opposition within the Curia itself.

Ezio Mauro: The pope is keenly aware this power structure has entrenched itself underneath the legitimate government of the church. He is probably isolated but he intends to change things.

NPR: Francis has already made big changes from all previous popes. He has appointed a commission of eight cardinals from all over the world to help him govern and reform the church. And he has decided not to live in the papal apartments, preferring to stay in the Santa Marta residence on Vatican grounds. There, he has breakfast and meals with other guests, visiting prelates and even low-level Vatican employees. And he frequently puts his own coins in the automatic espresso dispenser in the corridor.

Francis is surrounded by corruption and evil

Pope Francis says the reason he moved into the modest Casa Santa Marta instead of the regal Papal Apartments was so he could "feel like part of the family." Many think its so he can better avoid the corrupt conservative Curia which will not hesitate to murder a pope bent on reform that could cost them their power and wealth. “I’m visible to people and I lead a normal life-- a public Mass in the morning, I eat in the refectory with everyone else, et cetera," he explained. "All this is good for me and prevents me from being isolated. I’m trying to stay the same and to act as I did in Buenos Aires because if you change at my age you just look ridiculous.”

The NY Times speculates that Francis wants to root out the corruption among the Curia but that "changing the style of the papacy is far easier than changing the Vatican-- an ancient monarchy in which the pope is treated like a king, branches of the hierarchy are run like medieval fiefs and supplicants vie for access and influence. For decades popes have tried, and often failed, to change the Vatican. How Francis fares could define his papacy-- and determine whether the church can better serve its more than one billion faithful around the globe."

While the power of the pope is absolute, the vested institutional interests and vast bureaucracy of the Vatican are powerful, too. The waning days of Benedict’s troubled papacy were marked by complaints from ordinary Catholics as well as from powerful cardinals that the Curia had become too concerned with accumulating power and unresponsive to the needs of its followers.

For Francis to change that, he must contend with power centers within the Vatican that revolve around things like money, real estate and the distribution of resources, but also foreign policy, ideology and church doctrine. Beneath the pope, a handful of powerful cardinals preside over nine congregations, including ones that manage religious orders, global missionary work, the liturgy and the naming of bishops, as well as 12 pontifical councils. A single department oversees the process of selecting new saints.

The most powerful administrator, after the pope, is his secretary of state, who plays a critical role in guiding church affairs, setting the foreign policy agenda and controlling access to the pope.

Benedict selected Cardinal Tarcisio Bertone, a canon lawyer, who wielded tremendous power as the main gatekeeper, alienated many inside the Vatican and was widely seen as more interested in Italian politics than in global affairs.

The intense dissatisfaction with his management worsened long-simmering turf wars.

“For some time in various parts of the church, including among people extremely faithful to it, critical voices have been raised about the lack of coordination and confusion which reigns at its center,” Cardinal Paolo Sardi of Italy said to the pope in February 2009, in one of the letters published last May in the tell-all book, Your Holiness: The Secret Papers of Benedict XVI.

Those leaks raised the stakes by embarrassing even the pope. They showed the deluge of personal requests made of Benedict, but also included complaints of corruption by a senior Vatican official who was transferred after trying to rein in cost overruns.

...“The cardinals are accustomed to being treated like nobility,” said Jason Berry, author of Render Unto Rome,” a book examining the finances of the church. “The cardinals have de facto immunity. Under canon law, they are never punished. The other problem is that popes are very, very reluctant to shake up the political culture that elected them.”

Critics of the Curia say these traditions have nurtured a hierarchy of promotions and positions based on personal favoritism and connections. That structure is at once unwieldy and uncoordinated, they say, while being overly centralized, stirring resentment for the nontransparent and nondemocratic ways in which it renders judgments.

Last year, the powerful department known as the Congregation for the Doctrine of the Faith-- the same office that convicted Galileo of heresy and ran the Inquisition-- ordered a controversial reprimand of American nuns for challenging church teachings on homosexuality and the male-only priesthood.

Yet when a committee representing the leaders of different religious orders sought a meeting to clarify the nun issue, the Vatican response was murky at best, with no single department accepting responsibility for the investigation.

“There seems to be a kind of culture of secrecy in the Curia,” said the former superior general of a religious order who, like many others interviewed for this article, asked not to be identified in order to speak frankly. “Occasionally, they would send out a questionnaire for consultation on some issue. But basically, the Curia is a self-contained system that functions by itself.”

Even insiders complain that communication among various departments is slow and fractured. When the Vatican announced a plan to enable traditionalist Anglicans to find a home within the Catholic Church, it surprised even Cardinal Walter Kasper, the Vatican official overseeing the church’s relations with Anglicans. The announcement occurred while the cardinal was out of town.

...Pope Francis seems intent on changing this culture. He wore a simple white cassock when he was introduced as pope and later made reference to his “brother cardinals,” rather than addressing them as the customary “your lordships.” Last Saturday, the Vatican said Francis would provisionally reinstate all existing department heads, as is customary. But Vatican watchers say the very fact that he issued the statement, rather than staying silent, indicates he may install his own team relatively quickly.

Those who know the Vatican understand that changing it will not be easy.

If you can ignore, momentarily, the divisive, hot button issues like LGBT equality and women's Choice, Francis' papacy has started out as pretty hopeful for progressives, particularly when it comes to economic and social justice issues. His message has been very strongly against the kind of greed-is-good credo that conservatives adore and pattern their lives around. This pope has been speaking out against consumerism and against the Austerity Agenda that is pulverizing working families around the world. He's making a lot of powerful enemies along the way. Do you think Catholic conservatives like Paul Ryan and John Boehner are thrilled when the Pope says things like "I think about those who are unemployed often because of an economic conception of society that seeks egoistic profit regardless of social justice?" Marco Rubio who changes religion the way a normal person changes his underwear probably contemplates switching back to Mormonism or whatever cults he's been in when he hears the Pope saying "The Pope has the duty, in Christ’s name, to remind the rich to help the poor, to respect them, to promote them. The Pope appeals for disinterested solidarity and for a return to person-centred ethics in the world of finance and economics." It must send shudders of horrors down the backs of arch-reactionaries and acolytes of Greed and Selfishness in the Senate like Pat Toomey, David Vitter, Jim Risch and Joe Donnelly.

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Former Republican Congressman Rick Renzi Is Finally Headed To Prison On Corruption Charges

You may have noticed that DWT spends a lot of time going after a few especially bad Members of Congress. If you're a regular reader, you see a lot of mentions of shady characters like Darrell Issa, Paul Ryan, Ted Cruz, Debbie Wasserman Schultz, Buck McKeon, Michele Bachmann, John Barrow, Steve Israel, Louie Gohmert, Steve King, John Boehner, Miss McConnell, Joe Crowley... the worst of the worst from both sides of the aisle. When the blog got started in 2005, our focus was on people we rarely mention these days: Duke Cunningham, Tom DeLay, Mark Foley, John Doolittle, Dick Pombo and Rick Renzi. Cunningham went to prison on corruption charges; DeLay is out on bail while he appeals his convictions; Pombo was kicked out of office by his constituents; Foley resigned in disgrace and is trying to rehabilitate himself; Doolittle resigned in a trade-off with the Feds to stay out of prison (which is I think what Bachmann is up to now). And now-- finally-- Renzi is getting his due.

In 2008, after years of pussyfooting around (including being forced to resign from his committee in disgrace), Renzi was indicted on 35 criminal counts. And Tuesday... well, it depends which version you tune in on. Renzi's version is that the federal jury acquitted him on 15 charges. And that's true. But the jury also found him guilty on 17 counts including wire fraud, conspiracy, extortion, racketeering, money laundering and making false statements to insurance regulators. He turned 55 on Tuesday. He'll be sentenced on August 19.

Prosecutors said wire fraud, extortion, money laundering and racketeering each carry maximum penalties of 20 years in prison while conspiracy carries up to a five-year prison term. Making false statements to insurance regulators carries a maximum penalty of 10 years in prison.

Renzi, who turned 55 on Tuesday, left the courthouse without commenting.

“We are pleased that the jury acquitted Mr. Renzi on 15 counts,” his defense attorney, Chris Niewoehner, said in a statement. “We are disappointed by every guilty verdict. We will continue to fight these charges, including on appeal.”

Acting Assistant Attorney General Mythili Raman said Renzi must now face the consequences of his actions.

“Former Congressman Renzi’s streak of criminal activity was a betrayal of the public trust and abuse of the political process,” Raman said in a statement. “After years of misconduct as a businessman, political candidate and member of Congress, Mr. Renzi now faces the consequences for breaking the laws that he took an oath to support and defend.”

The indictment charged that Renzi, while in office in 2005, held hostage possible parcel swaps involving public land proposed as the site for an Arizona copper mine unless it included purchasing private land owned by a former Renzi business associate, James Sandlin.

According to the indictment, an investment group agreed to pay $4.6 million for the associate’s land, and he then paid Renzi $733,000 for his help.

Renzi had been named Congress' most corrupt Member by CREW 4 times. Between 1989 and 2012 he raised $5,947,867 from campaign donors, primarily from the Real Estate, Insurance and Gambling industries. One of the counts he was found guilty of was looting a family insurance business to help pay for his 2002 campaign. Over all, he was convicted for using his office for personal gain, something that almost all Republicans and too many Democrats are also guilty of.

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Corrupt New Jersey Machine Dems Gravitate To Christie... Of Course

New Jersey corruption personified: Christie and DiVincenzo

New Jersey politics is a cesspool of corruption-- bipartisan corruption. The New Jersey Republican Party is hopelessly corrupt and the New Jersey Democratic Party is hopelessly corrupt. That's why I've been so awed by Barbara Buono's nomination as the Democratic candidate for governor. She isn't corrupt. In fact... she's been fighting the corrupt Machine Democrats inside her own party for years. In 2010, Buono’s Democratic colleagues made her the first woman majority leader of the state Senate. But her tenure was short-lived. Buono refused to go along with Senate President Stephen Sweeney and Assembly Speaker Sheila Oliver’s support for Christie’s plan to reform public employees’ pension and health insurance benefits. Buono supports pension reform, but was opposed to lumping together pensions and health care. She is adamant that health care benefits should be hammered out only through collective bargaining. In response, the Democrats stripped Buono of her Senate title, replacing her with Senator Loretta Weinberg of Teaneck. "It wasn't a hard call," Buono says of her stance. "I'd do it again." This morning she told us:

"When I go around New Jersey meeting folks and telling them who I am, I always make sure they know first and foremost that I am running this race for them. I've proved I'm a reformer in the past, by refusing to go along with Christie's plan to strip public employees' of their health insurance benefits, even though it cost me my Senate majority position, and I'd do it again. To do what is best for New Jersey's middle class and working poor, I won't shirk from standing up to Republicans or Democrats."

The corrupt politicians hate her and fear she will take away their opportunities for graft and bribes. So, of course the most corrupt Democratic machine bosses are supporting Chris Christie, who they've been playing footsie with for years. No one was surprised when state Sen. Brian Stack, the mayor of Union City, a grievously corrupt Democratic powerbroker in Hudson County and a key legislator in pushing through Christie's reactionary agenda, announced he's for Christie. From yesterday's Newark Star-Ledger:

One of New Jersey’s more influential Democrats, Essex County Executive Joseph DiVincenzo, is poised to endorse Gov. Chris Christie this afternoon-- just a day after the Republican was backed by another Democratic powerbroker.

When many in New Jersey hear Christie's and DiVincenzo's names linked the first thing they think of is the 3 part New York Times expose from last year that resulted from a 10 month investigation and exposed the kind of corruption that has plagued New Jersey where corrupt Democrats and corrupt Republicans have each other's backs. "A company with deep ties to Gov. Chris Christie dominates New Jersey’s system of large halfway houses," reports the Times. 'There has been little state oversight, despite widespread problems... After decades of tough criminal justice policies, states have been grappling with crowded prisons that are straining budgets. In response to those pressures, New Jersey has become a leader in a national movement to save money by diverting inmates to a new kind of privately run halfway house. At the heart of the system is a company with deep connections to politicians of both parties, most notably Gov. Chris Christie. Many of these halfway houses are as big as prisons, with several hundred beds, and bear little resemblance to the neighborhood halfway houses of the past, where small groups of low-level offenders were sent to straighten up. New Jersey officials have called these large facilities an innovative example of privatization and have promoted the approach all the way to the Obama White House. Yet with little oversight, the state’s halfway houses have mutated into a shadow corrections network, where drugs, gang activity and violence, including sexual assaults, often go unchecked." Over 5,000 inmates have escaped, including two violent inmates who went on to commit murders. That's just one example about the way corrupt political bosses in New Jersey enrich themselves and their cronies and promote their careers-- all at the expense of the public. Christie has good p.r., but he's at the center of a web of corruption, bolstered by crooks like DiVincenzo.

In 2011 the Star-Ledger exposed another scam that enriched the politicians at the expense of New Jersey taxpayers-- so called "community education centers" that have been set up as shell corporations running the halfway houses and operates based on a rigged bidding system put together by Christie and DiVincenzo. "Community Education and its executives are major supporters of Mr. DiVincenzo, one of the most powerful politicians in North Jersey. Community Education employees, including senior executives and several of their family members, have donated a total of $30,600 to Mr. DiVincenzo’s campaigns since 2006," the New York Times reported. "The comptroller also questioned the legality of the state's contract with its largest provider of halfway houses, the politically connected Education and Health Centers of America. The state can only contract with nonprofit groups for halfway homes. But the report describes EHCA as a shell corporation, passing almost all its state dollars to the for-profit company Community Education Centers, which runs the houses. The same person, John Clancy, runs both organizations. William Palatucci, Gov. Chris Christie's close political adviser, is a senior vice president at the for-profit company."

Inmate escapes. Hundreds of thousands of dollars in overpayments. Shoddy buildings. Lax inspections. New Jersey pumps nearly $65 million a year into a network of privately run halfway houses, but the system is rife with problems, according to a state comptroller report released today. Even when contracts are violated, the state has failed to crack down on security lapses, the report said. Worst of all, the report said, it’s unclear whether the programs are actually achieving their chief goal: reducing the number of inmates committing new crimes by preparing them for life outside prison. Comptroller Matthew Boxer said the state "cannot simply cut these halfway houses a check and hope for the best."

Meanwhile, Christie has asked Palatucci, who had been a registered lobbyist for Community Education (but so had Christie himself), to lay low while he's running for reelection in the hope that the voters will forget all the corruption. Yesterday's endorsement by DiVincenzo reminded voters about why they hated Christie so much before Hurricane Sandy swept away so many memories of his corrupt way of doing business and milking the taxpayers. Christie's p.r. attempts to make himself over as a reformer instead of a gangster was taking a hit.

[W]hen it comes to Community Education Centers Inc., the principal operator of privately run halfway houses in New Jersey, Christie is following the path taken by his predecessors. Christie forged a close alliance with a company that’s deeply entrenched in New Jersey’s political status quo-- a move at odds with the style that has made him such a hero among Republicans across the country.

That helps explain Christie’s vigorous defense of Community Education-- and the deafening silence from Democrats-- after a scathing New York Times examination this week of the state’s halfway house program. It found that the halfway homes system had morphed into “a shadow corrections network, where drugs, gang activity and violence, including sexual assaults, often go un-checked.” Supervision is lax and since 2005, some 5,100 inmates have escaped, the report found.

At town hall meetings and press conferences, Christie loves to single out examples of government gone haywire-- school superintendents who move like salary-padding mercenaries from district to district, retirees amassing enormous sick leave payouts, teacher unions using students as “drug mules” to carry home propaganda about school elections.

Those broadsides have become the hallmark of the Christie style. But he’s never vented his disgust over the thousands of inmates who slip away from halfway houses. He did not go bonkers last year when the state comptroller studied halfway houses and revealed “crucial weaknesses in state oversight.”

Instead, Christie is something of an apostle of Community Education’s work, citing it as a prime example of how a privately run company functions better than government-- in this case, by reducing recidivism and prison costs. By promoting their work, Christie has used private companies like Community Education to help fashion his own image as a cost-effective pragmatist.

“A spotlight should be put on them as representing the very best of the human spirit,” Christie said during a visit to a Newark facility in 2010. “Because as you walk through here, as I’ve done before many times, what you see right before your eyes are miracles happening.”

Christie’s relations with Community Education stretch back more than a decade. John J. Clancy, its chief executive and founder, hired Dughi, Hewit & Palatucci, a Westfield law firm, to lobby in Trenton. Its lobbyists were Christie and William J. Palatucci, who has been and remains Christie’s longtime political confidant and adviser. Although he was registered, Christie did not actively lobby for the firm.

In 2005, Palatucci was hired as Community Education’s senior vice president. Clancy’s son-in-law was hired in 2010 to work as an assistant in Christie’s office. And while Community Education officials have not made direct contributions to Christie or the Republican State Committee, which he controls, the firm donated $50,000 to the Republican Governors Association in late 2008 and 2009 at a time when the group ran ads promoting Christie’s candidacy for governor.

Political analysts say the Times report could put a dent in Christie’s well-crafted national persona as a former-lawman-turned-reformer governor. But there is a potential saving point here for Christie, thanks to the Jersey political culture that he decries. Whereas in other states, a report like this would fuel opponents, Democrats here in New Jersey have held off attacks on the Republican governor.

...Community Education’s contributions may also explain why Democrats have been so uncharacteristically muted about The Times’ report. Former Gov. Dick Codey of Roseland, a major recipient of Community Education campaign donations, did not return a call seeking comment. Codey was also a longtime insurance broker for the company, according to the newspaper. Only Sen. Barbara Buono of Middlesex County-- who received a combined $2,600 in donations in 2010 and 2011 [which she returned]-- publicly raised concerns about halfway house supervision and Assemblyman Charles Mainor, D-Hudson, called for legislative hearings on the halfway house issue.

Christie, of course, fought the efforts to investigate his cronies and "used a line-item veto to reduce new disclosure requirements about halfway houses that the Democratic-controlled Legislature inserted in the state budget" and "vetoed a requirement that the department report actions that the halfway houses had taken to prevent, and protect inmates from, violence." He and DiVincenzo have stood by each other's corrupt and criminal activities.

For those who know DiVincenzo, none of this comes as a shock. This is the guy who collects a $59,000 pension on top of his big salary, and he hasn’t retired yet. He knows the angles.

The surprise came when Gov. Chris Christie was asked about this at a recent news conference, and he chose to defend DiVincenzo, a key Democratic ally.

“If, in fact, what they are doing is moving forward on their political agenda, then that’s appropriate,” the governor said.

If you listened hard, you could hear the final nail being pounded into the coffin of ethics reform during the Christie years.

Christie is New Jersey’s only hope on ethics reform. Famous for his undefeated string of corruption convictions, he brought a busload of federal prosecutors with him to Trenton. And he presented a strong package of ethics reforms almost immediately.

The Democrats have ignored it. Turns out they like to have two government jobs, they like to keep their finances under wraps and they don’t want any do-gooder campaign finance rules that might deprive their political machines of needed cash.

So if the governor goes wobbly, too, there really is no hope. That’s why the news conference was so deflating.

“If they’re operating within the current law, then they’re operating within the current law,” he said of the crew in San Juan.

Say what? The cops who take home $200,000 in unused sick pay are operating within the law, and so were the teachers who refused to accept a pay freeze. He didn’t have any problem pounding them into dust.

It’s sad, really, that Christie has squandered his natural advantage on the issue. The first big blow came when he solicited secret donations to Reform Jersey Now, an outfit run by his closest allies. When the donors’ names were finally revealed, a number of state contractors were on the list.

He squandered more of his mojo when he lambasted the Passaic Valley Sewerage Commission for its patronage habits, but was moot when similar charges were made against the Elizabeth Board of Education, a political ally of his.

Christie’s hypocrisy on this gives Democrats safe haven. When the governor proposes limits on campaign spending by unions, for example, they can point to the money he raised for Reform Jersey Now.

“We’re supposed to silence the union, but let all his corporate buddies fund all they want?” asks Senate President Steve Sweeney (D-Gloucester).

And let's not leave out George Norcross, the South Jersey Democratic political boss, another corrupt Christie crony, who desperately wants to see Christie reelected.

For students of Jersey politics, the elephant in the room, of course, is Christie’s role in the Palmyra investigation, and those notorious tapes of George Norcross practicing politics. I ask Christie to discuss the subject. "I made it a practice not to talk about that kind of stuff from when I was U.S. Attorney, in terms of ‘shining any new light’ on things," he replies. "I think if you want to know what my view of the investigation was, then read the letter I sent to the acting Attorney General." In that letter, addressed to the state Attorney General’s office, and ultimately disseminated to the media, Christie explained that he would be unable to prosecute Norcross because investigators bungled the case. They failed to obtain wiretaps on their principal subjects, including Norcross, and didn’t equip an informant with a wire at one key political function. Christie even wondered, in print, if the investigation had been purposefully undermined for political reasons… "Reviewing the letter again," I say to Christie, "as I did this morning… you look like a guy lamenting the one that got away. Right? And one of the ones that got away there was George Norcross." The entire time I speak, Christie sits there nodding. Then he responds: "Well, listen, you know, you change roles. Um, I’m now-- here I was the United States Attorney, a prosecutor, and I was doing my job as I saw it. And now I’m the governor. And now I’m a political leader, on top of being a governmental leader. And so certain things that I couldn’t do as a prosecutor, I can do now, and I’m really obligated to do, and certain things that I could do as a prosecutor I can’t do anymore. So, you know, your power is in some ways expanded and your power in some ways is limited, as the governor, as compared to being U.S. Attorney."

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Can "Ex"-Blue Dog Steve Israel Be Beaten... Preferably In A Primary?

When making an excuse for reappointing Israel chairman of the DCCC, despite his dismal failure in 2012, the nicest thing Nancy Pelosi could muster to say about his abilities was that he's "reptilian." Although he claims he performed so horrifically in 2012 because his wife was divorcing him, he doesn't seem to have learned a thing and is leading the Democrats to doom again-- forcing vulnerable freshmen far to the right of their Democratic bases which is likely to lead to the Great New Dem Apocalypse of 2014 for almost identical reasons the DCCC brought on the Great Blue Dog Apocalypse of 2010.

Though I was born in Brooklyn, a good part of my childhood-- as well as all of my college years-- was spent on Long Island. I know Steve Israel's district better than the back of my hand. And don't be surprised if voters there oust him. All it would take is a plausible opponent-- either in a primary or in a general election. And while I'd rather see a progressive Democrat take him down, I'd be almost as happy to see a Republican beat him if the Democrats can't get it together to clean up their own mess.

Obama won all three Long Island districts, though not by much-- and underperformed his 2008 totals in all 3. He did better in Peter King's NY-02 than in Israel's NY-03.

• NY-01- Obama- 49.6- 49.1%
• NY-02- Obama- 51.6- 47.2%
• NY-03- Obama- 50.8- 48.2%

While Patty Murray was leading the DSCC from one jaw-dropping victory to another in state after state, cleaning up against the Republicans last November, Israel was losing, losing and losing-- losing everywhere as all his ill-conceived strategies-- starting with pathetic recruitment and even worse targeting--- failed dismally (albeit predictably). And while this was going down, he was occupied fighting with his wife over the spoils of personal corruption... and working with his donors at JPMorgan Chase on a short sale of his Dix Hills home that included a convenient $93,000 bribe from one of the worst bankster outfits on Wall Street.

The original mortgage lenders to Congressman Steve Israel made over $50,000 in campaign contributions to Steve Israel for Congress and more to the Democratic Congressional Campaign Committee he chairs.

Of two original loans to the Congressman and his ex-wife for the Dix Hills home they recently sold in a short sale, one was from Homebridge Mortgage Bankers Corp. The company went bankrupt in 2008 and is currently the subject of numerous lawsuits. Two of the loans they got to refinance the home a year later were both from Homebridge.

Records show Homebridge Chairman and President, Nicholas A. Bratsafolis and his wife Michelle, gave $21,000 to the Steve Israel for Congress Committee and his New York Jobs PAC between 2003 and 2007.

Another listed President of Homebridge Mortgage, David Pankin, from Plainview, contributed $3,500 to the Steve Israel for Congress Committee between 2003 and 2005.

Together, Bratsafolis and Pankin also contributed more than $35,000 dollars to the Democratic National Committee and the Democratic Congressional Campaign Committee, chaired by Israel.

According to Stephen Labate, Congressman Israel’s GOP challenger in the November election for the newly drawn 3rd Congressional District, “The donations tied to the loans raise serious questions of insider sweetheart deals.”

In July of 2004, Congressman Israel and his wife, Suffolk County Family Court Judge, Marlene Budd, purchased the Dix Hills home with two mortgages: one from Homebridge for $464,000 dollars and another from National City Bank for $57,950 dollars. Congressman Israel paid a down payment of $58,050 dollars or roughly 10% on the original purchase.

In August of 2005, Congressman Israel and his wife, refinanced with Homebridge, getting two loans from them, one for $508,000 and one for $63,500 dollars totaling $571,500 for the house they bought for $580,000 dollars in 2004. They satisfied the original loans when they refinanced.

“It is more than curious that just a year after purchasing the home, the congressman refinanced the home at 98.5% of the original purchase price from a mortgage lender whose principle owners just happen to be major donors to the congressman and his party.” according to Chris Thompson, Mr. Labate’s campaign manager. The Israel camp did not respond when asked how much, if any, down payment was part of the refinance deal in 2005.

In October of 2006, Congressman Israel and his wife got another mortgage on the same property for $105,000 dollars from JP Morgan Chase. That brought the total in 2006 to $675,500 dollars for the three mortgages on the Long Island home. In 2006, they also purchased an apartment in Washington, D.C. for approximately $416,000 dollars.

The house in Dix Hills sold recently for $460,000 dollars. In early October, the New York Post ran a story revealing JP Morgan Chase forgave $93,000 dollars on Israel’s “underwater mortgage.” The Israel campaign does not deny the amount and the fact of the JP Morgan Chase loan forgiveness.

Congressman Israel voted in 2008 to bailout JP Morgan Chase with $25 billion, through the Troubled Asset Relief Program (TARP).  JP Morgan paid back the loan with interest.  GOP strategists argue they may have paid back Congressman Israel by forgiving the $93,000 debt he still owed on his “underwater loan” to them.  The Israel camp denies any special treatment and insists that all transactions were above board and by the book.

Ed Cox, the New York State GOP Chairman, released a statement after the New York Post  article responding to the loan forgiveness.  

“On the surface it would appear that he would not qualify for such a reduction, so we asked the House Ethics Committee to investigate the circumstances that surround what looks to be a highly questionable transaction and a potential abuse of power.”

...“Short sale listings on Long Island per MLS (for the period 1/1/12-10/10/12) were 3,348 out of 30,526 total listings. That calculates to 10.9% not the 14.5% offered by the Israel campaign,” according to Mr. Thompson [campaign manager for his 2012 Republican opponent]. “Looking only at homes over $450,000 the number falls to less than 1% and Mr. Israel’s home was 1 of only 246 homes in that price range” he added.

Congressman Israel will not have to pay taxes on the cancellation of debt, because the Mortgage Debt Relief Act, (HR 3648,110th Congress), was extended through 2012 by the Economic Stabilization Act of 2008, Steve Israel voted for.

Before the Mortgage Debt Relief Act, anytime a lender, would write down (or forgive) the borrower’s debt to accommodate a settlement, they were required to report the amount of the write-down to the IRS and it could be considered income to the borrower. Treated as income the written-down amount becomes taxable and would need to be reported on the 1040 tax return. Normally, if a person gets debt forgiveness on an unsecured debt like a credit card, he must pay taxes on it. A temporary measure, The Mortgage Debt Relief Act was to expire, but thanks to the extension of the act through 2012, something Congressman Israel voted for, he will not have to pay taxes on the $93,000 JP Morgan Chase forgave.

Family Court Judge Marlene Budd and Congressman Israel have a combined income of over $300,000. Records show they purchased a 2nd home in Washington D.C. in February 2006.  Two mortgages were taken out on the D.C. apartment from Wachovia Bank: one for $56,667 and another for $302,228 for a total of $358,895. This apartment is not currently listed for sale as reported in Newday recently.

The total mortgage debt on their two homes in October of 2006 was about one million dollars.  Without including any credit card debt they might have had, their debt equity would be greater than the norms allowed for a conventional mortgage at their pay grade, according to the Labate campaign.

Democratic New York State Senator Kirsten Gillibrand, has a televised campaign ad touting the new “Stock Act” she recently passed-- banning insider trading in the stock market by members of Congress based on information they get as members of influential committees. “Members of Congress should play by the exact same rules as families like yours.”

Some Republican’s are questioning whether Mr. Israel who has represented the 2nd Congressional District since 2001 and is now running for the 3rd CD, is playing by the same rules as his own constituents when it comes to his mortgage.

According to Stephen Labate,  “Since the story of the Congressman’s short sale broke, voters all across our district have been expressing their outrage, both to me and to our campaign volunteers.  Many have relayed their personal stories of financial duress and being turned away by their mortgage lenders when they sought relief. Voters are tired of the insider deals our elected officials cut for themselves and I believe they will voice their discontent at the polls on Election Day.”

Election Day came and went and Labate wasn't deemed a plausible candidate by the voters. Israel has portions of three counties. He won them all, although underperformed in the parts of the district, Nassau and Suffolk, where they knew him best.

• Nassau- 62,180 (56%)
• Suffolk- 51,903 (57%)
• Queens- 22,604 (65%)

The new 3rd District includes the Queens neighborhoods of Whitestone, Beechhurst, Little Neck, Douglaston, Fort Totten, Bay Terrace and (a portion of Bayside). On Long Island, Israel's new district lost the towns of Babylon and Islip from his old district. He retains the Town of Huntington and a small western portion of the Town of Smithtown from the previous district. In Nassau County, the district now includes Oyster Bay, Great Neck, Manhasset, Port Washington, Roslyn, Williston Park, Floral Park and New Hyde Park.

Previously a D+8 district, Israel's is now one of only 9 in the whole country rated exactly EVEN, not an R+1 like Peter King's to the south and not a D+1 like Frank LoBiondo's in New Jersey. So Israel had to actually campaign for himself last year. His first instinct, of course, was to throw President Obama under the bus.

“I’ve had disagreements with President (Barack) Obama over certain things,” Israel said. “I have agreements with him on other things, but on the disagreements I’m able to talk to him face to face because I’m in leadership and say ‘we need to do better on this.’”

A source of debate with Obama has been the “Bush tax cuts.”

Obama wants to eliminate the cuts for people earning more than $250,000 each year. Israel said he believes the cut off should be higher in areas of the country that are more expensive to live in.

“Well, $250,000 may make you rich in Hastings, Nebraska, but it does not make you rich in Huntington, Long Island,” Israel said. “I’ve had an argument with (Obama) that we ought to adjust the tax code to reflect the local cost of living.”

Although many Long Island residents are annually among the nation’s highest earners, Israel said the elevated cost of utility bills, property taxes and a high cost of living can make for difficult financial situations for residents of his district.

“Being chairman of the DCCC... puts me in the Oval Office where I can say to the president ‘Rich is relative, Mr. President and I wish you would understand that,’” Israel said.

He won but this cycle the NRCC has said they will target him and spend money trying to defeat him if they can recruit a credible candidate. I wish them all the luck in the world.

How could anyone vote for Steve Israel? He represents the wealthy people of his district-- and only the wealthy people of his disrict. Meet his constituents:

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Corruption In Ohio

Joe McNamara-- fighting for progressive values and against political corruption

2013 will be a critical year for progressive across the country, as there are many important races, even beyond New Jersey and Virginia, that will help to build the Democratic bench for the future. Ohio is no different, although perhaps in more dire need for solid progressives who fit the independent-minded Sherrod Brown mold. And no down ballot race in the Buckeye State is more important, or offers such a clear choice, as the Mayor’s race in Toledo.

Despite Toledo giving President Obama over 70% of the vote last November, the city’s current Mayor has endorsed the Tea Party Governor of Ohio’s regressive budget and S.B. 5, which attacked workers right to organize in Ohio. Governor Kasich fondly refers to Mayor Bell as his “buddy,” and this race will be Kasich’s first test for 2014. Toledo voters, who probably see as much Michigan media as Ohio media-- and are well aware of the toxic nature of the Tea Party/GOP agenda for working families-- need to replace Bell with a progressive Democrat.

There are two Democratic candidates in this race. One, Joe McNamara, has been a strong progressive champion on the City Council. He has been a longtime supporter of marriage equality, fought for green jobs, and even sued former Secretary of State Ken Blackwell when he initiated Tea Party style voter suppression tactics back in 2006. Joe’s strong progressive record is why former Secretary of State Jennifer Brunner has stepped up and endorsed him.

His Democratic opponent is the County Auditor, Anita Lopez. Lopez is exactly the type of Democrat that progressives have been fighting against for years. She is a career political climber who has refused to take a stand on any important issue. Worse, corruption and political cronyism surround her time in the Auditor’s office.

The latest scandal to break involve 7 of her top political advisers (who also happen to work in her Auditor’s Office). They were all given huge raises totaling $131,147.73 out of the county budget. And most of these were right after these advisers worked on her 2010 election. Coincidence... I don’t think so. That’s an average raise of over $18,000! A politician who is using her elected office as a way to dole out cushy jobs to her political staff is not someone we can afford to promote to the Mayor’s office.

The cronyism continues today. Lopez’s current Campaign Manager works in her Auditor’s office. How much prior auditing experience did he have? You guessed it, 0. The person handling her fundraising received a $22,000 raise on the taxpayer’s dime. The individual handling her social media, an $11,000 pay raise. She gave the extremely politically-connected daughter of the former (and also scandal tarred) Party Chairman a $34,000 raise. If you work hard on the campaign like one staffer did, than you can get a raise of $22,497. Or if you want to just make a $2,500 donation to her campaign you will receive an $11,000 raise as one lucky staffer did. That sounds like quite the deal, but when it’s the taxpayer’s money why should Lopez care?

Ohio Democrats and the folks who live in Toledo need a progressive mayor of the Democratic bastion, not a corrupt politician who is running her campaign from the County Auditor’s office while rewarding staff who help her political ambitions with huge pay raises. This race is shaping up very much the way "former" Republican Wendy Greuel went head to head with progressive champion Eric Garcetti in Los Angeles this month. Despite massive support from every corrupt corner of the Democratic Party, Greuel lost-- and lost badly... and then said it was because voters are a bunch of sexist pigs and has been whining about a "glass ceiling." Odd in a state with TWO female women senators and 18 congresswomen. Maybe EMILY's List told her to say it. They poured resources into her race as well as the abysmal advise to go negative-- which is what actually cost her the election.

Please consider making a contribution to Joe McNamara for Mayor, and sign up to receive updates on his campaign. Lets help Ohio take on a nice healthy blue hue-- starting in Toledo. You can follow Joe on Twitter and Facebook if you'd like.

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Americans Pay More For Healthcare-- More Skilled Medical Industrial Complex Lobbyists Than Any Other Country

In other developed countries, a basic colonoscopy costs just a few hundred dollars and certainly well under $1,000. The NY Times, in a report looking into run-away inflation of medical services, reported on typical colonoscopies costing between $6,385 and $19,438 (including a routine a polyp removal). "That chasm in price," writes Times health reporter Elisabeth Rosenthal, "helps explain why the United States is far and away the world leader in medical spending, even though numerous studies have concluded that Americans do not get better care."

Whether directly from their wallets or through insurance policies, Americans pay more for almost every interaction with the medical system. They are typically prescribed more expensive procedures and tests than people in other countries, no matter if those nations operate a private or national health system. A list of drug, scan and procedure prices compiled by the International Federation of Health Plans, a global network of health insurers, found that the United States came out the most costly in all 21 categories-- and often by a huge margin.

Americans pay, on average, about four times as much for a hip replacement as patients in Switzerland or France and more than three times as much for a Caesarean section as those in New Zealand or Britain. The average price for Nasonex, a common nasal spray for allergies, is $108 in the United States compared with $21 in Spain. The costs of hospital stays here are about triple those in other developed countries, even though they last no longer, according to a recent report by the Commonwealth Fund, a foundation that studies health policy.

While the United States medical system is famous for drugs costing hundreds of thousands of dollars and heroic care at the end of life, it turns out that a more significant factor in the nation’s $2.7 trillion annual health care bill may not be the use of extraordinary services, but the high price tag of ordinary ones. “The U.S. just pays providers of health care much more for everything,” said Tom Sackville, chief executive of the health plans federation and a former British health minister.

Colonoscopies offer a compelling case study. They are the most expensive screening test that healthy Americans routinely undergo-- and often cost more than childbirth or an appendectomy in most other developed countries. Their numbers have increased manyfold over the last 15 years, with data from the Centers for Disease Control and Prevention suggesting that more than 10 million people get them each year, adding up to more than $10 billion in annual costs.

Largely an office procedure when widespread screening was first recommended, colonoscopies have moved into surgery centers-- which were created as a step down from costly hospital care but are now often a lucrative step up from doctors’ examining rooms-- where they are billed like a quasi operation. They are often prescribed and performed more frequently than medical guidelines recommend.

The high price paid for colonoscopies mostly results not from top-notch patient care, according to interviews with health care experts and economists, but from business plans seeking to maximize revenue; haggling between hospitals and insurers that have no relation to the actual costs of performing the procedure; and lobbying, marketing and turf battles among specialists that increase patient fees.

While several cheaper and less invasive tests to screen for colon cancer are recommended as equally effective by the federal government’s expert panel on preventive care-- and are commonly used in other countries-- colonoscopy has become the go-to procedure in the United States. “We’ve defaulted to by far the most expensive option, without much if any data to support it,” said Dr. H. Gilbert Welch, a professor of medicine at the Dartmouth Institute for Health Policy and Clinical Practice.

...Hospitals, drug companies, device makers, physicians and other providers can benefit by charging inflated prices, favoring the most costly treatment options and curbing competition that could give patients more, and cheaper, choices. And almost every interaction can be an opportunity to send multiple, often opaque bills with long lists of charges: $100 for the ice pack applied for 10 minutes after a physical therapy session, or $30,000 for the artificial joint implanted in surgery.

The United States spends about 18 percent of its gross domestic product on health care, nearly twice as much as most other developed countries. The Congressional Budget Office has said that if medical costs continue to grow unabated, “total spending on health care would eventually account for all of the country’s economic output.” And it identified federal spending on government health programs as a primary cause of long-term budget deficits.

While the rise in health care spending in the United States has slowed in the past four years-- to about 4 percent annually from about 8 percent-- it is still expected to rise faster than the gross domestic product. Aging baby boomers and tens of millions of patients newly insured under the Affordable Care Act are likely to add to the burden.

...A major factor behind the high costs is that the United States, unique among industrialized nations, does not generally regulate or intervene in medical pricing, aside from setting payment rates for Medicare and Medicaid, the government programs for older people and the poor. Many other countries deliver health care on a private fee-for-service basis, as does much of the American health care system, but they set rates as if health care were a public utility or negotiate fees with providers and insurers nationwide, for example.

“In the U.S., we like to consider health care a free market,” said Dr. David Blumenthal, president of the Commonwealth Fund and a former adviser to President Obama. ”But it is a very weird market, riddled with market failures.”

Consider this:

Consumers, the patients, do not see prices until after a service is provided, if they see them at all. And there is little quality data on hospitals and doctors to help determine good value, aside from surveys conducted by popular Web sites and magazines. Patients with insurance pay a tiny fraction of the bill, providing scant disincentive for spending.

Even doctors often do not know the costs of the tests and procedures they prescribe. When Dr. Michael Collins, an internist in East Hartford, Conn., called the hospital that he is affiliated with to price lab tests and a colonoscopy, he could not get an answer. “It’s impossible for me to think about cost,” he said. “If you go to the supermarket and there are no prices, how can you make intelligent decisions?”

Instead, payments are often determined in countless negotiations between a doctor, hospital or pharmacy, and an insurer, with the result often depending on their relative negotiating power. Insurers have limited incentive to bargain forcefully, since they can raise premiums to cover costs.

“It all comes down to market share, and very rarely is anyone looking out for the patient,” said Dr. Jeffrey Rice, the chief executive of Healthcare Blue Book, which tracks commercial insurance payments. “People think it’s like other purchases: that if you pay more you get a better car. But in medicine, it’s not like that.”

The National Memo reviewed Gar Alperovitz’s recently released book, What Then Must We Do? Straight Talk About The Next American Revolution this morning:

Everyone knows we have problems in the United States: unemployment, poverty, environmental decay, global warming-- to say nothing of whole cities like Detroit, Cleveland, St. Louis, and many others that have essentially been thrown away. If you are black or brown, your prospects are far worse. And wars keep happening, with little positive outcome and lots of dead American kids (to say nothing of dead Iraqis, Afghanis, and others). Civil liberties decay, day by day, year by year.

So much is obvious. Moreover, this wealthiest of all wealthy nations has been steadily falling behind many other nations of the world. Consider just a few wake-up-call facts from a long and dreary list: The United States now ranks lowest or close to lowest among advanced “affluent” nations in connection with inequality (21st out of 21), poverty (21st out of 21), life expectancy (21st out of 21), infant mortality (21st out of 21), mental health (18th out of 20), obesity (18th out of 18), public spending on social programs as a percentage of GDP (19th out of 21), maternity leave (21st out of 21), paid annual leave (20th out of 20), the “material well-being of children” (19th out of 21), and overall environmental performance (21st out of 21).

Add in low scores for student performance in math (17th out of 21), one of the highest school dropout rates (14th out of 16), the second-highest per capita carbon dioxide emissions (2nd out of 21), and the third-highest ecological footprint (3rd out of 20).

The "Health" industry is the second largest professional group in paying legalistic bribes to Members of Congress, right after Wall Street. In the last congressional cycle, "health" groups spent $260,409,805 bribing Congress. The single biggest amount came from the Adelson Drug Clinic ($41,994,800), controlled by a foreign agent and organized crime affiliate, Sheldon Adelson and his crooked Israeli wife.

The five most highly bribed Members of Congress by the Medical Industry who are still serving are mostly guardians of the sky's-the-limit medical industry business model:

• John McCain (R-AZ)- $10,069,353
• Orrin Hatch (R-UT)- ranking Republican on the Senate Finance Committee- $4,343,392
• Frank Pallone (D-NJ)- Ranking Member on the Health Subcommitte- $4,056,793
• Miss McConnell (R-KY)- Senate GOP Leader- $4,040,068
• Max Baucus (D-MT)- Senate Finance Committee Chair- $3,944,952

Other major medical industry bribe takers are powerful Members like John Boehner (R-OH- $3,064,394), Steny Hoyer (R-MD- $3,050,204), and Harry Reid (D-NV- $3,014,977). Am I implying that medical costs would be significantly more in line with costs in the rest of the world if bribing congressmen was illegal and if bribers and bribees were hanged in a stadium in a televised ceremony? Yes, exactly-- although you can leave out the mass hangings if you have no stomach for it and see if it works with stiff prison terms instead. Single-payer health insurance would also solve the problem-- but you have to stop the bribery first to get there. Or just help defeat every corrupt conservative that runs for any office anywhere.

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