February 27, 2009

From the Desk of Judicial Watch President Tom Fitton:

Strike Three…Obama’s Third Commerce Secretary Nominee Has Corrupt Ties to Chinagate

This is all starting to get a little ridiculous. Obama’s first pick for Commerce Secretary, Bill Richardson, had to withdraw his name when it was discovered that he was the subject of a federal grand jury investigation concerning influence peddling. Obama’s second choice, New Hampshire Senator Judd Gregg, first accepted and then rejected the nomination, citing irreconcilable policy differences (which included Gregg’s objecting to the politicization of the Census by the Obama White House).

Next up: Former Washington Democratic Governor Gary Locke. So is the third time the charm for the president? Or, as columnist Michelle Malkin put it, "Is it possible for Barack Obama to pick a Commerce Secretary nominee who’ll actually make it past first base?"

Locke may in the end get the votes he needs but he is a horrible choice for such a sensitive post. Allow me explain.

Remember the Chinagate scandal, where the Clintons and the Democratic National Committee raised gobs of cash from communist Chinese operatives? (This is perhaps the worst fundraising scandal in U.S. history, and Judicial Watch was one of the first to get on top of it. Check out the first three related lawsuits listed on this page.)

Well, the Clinton Chinagate scheme had a focus in the Clinton Commerce Department. One of the key figures in Chinagate is none other than former Clinton Commerce official and DNC fundraiser John Huang. You may recall, when deposed by Judicial Watch in its Chinagate litigation, Huang took the fifth more than 2,000 times in connection to the scheme, although he did eventually plead guilty to violations of campaign finance laws.

In the midst of violating all those campaign finance laws in the 1990s, Huang also found time to raise money for another key Democratic rising star, Gary Locke.

Huang personally stroked a $1,000 check for Locke and also co-sponsored fundraising events that netted $30,000 in 1996 alone.

Of course, when criticized for his connections to Huang, Locke quickly yanked out the race card. (Liberals always seem to have the "race card" handy in their breast pocket, don’t they?)

In 1999, Locke told a group of Asian American journalists that the Chinagate scandal will have a negative impact on Asian Americans seeking top-level appointments in the U.S. Government. "If they have any connection to John Huang," Locke lamented, "those individuals will face greater scrutiny and their lives will be completely opened up and examined – perhaps more than usual."

We can only hope.

There is little doubt that there was a plan by the Chinese Communist government to influence our politics with campaign cash. The Clintons were happy to play along. And it looks like Gary Locke may have been, too.

Michelle Malkin has done some excellent reporting on the Locke-Chinagate connections, much of the work produced while Michelle was working for the Seattle Times in the 1990s. Click here to read her posts.

The Locke appointment is par for the course for Barack Obama, who admitted recently he "screwed up" on some of his previous picks. The last thing we need is a Commerce Secretary with ties to a foreign fundraising scheme that actually took place at the Commerce Department not too long ago.

Federal Government Meddles in Corporate Takeover

Not that there was ever any doubt the federal government has used the financial crisis to interfere in the private sector and expand its power and influence, but new documents uncovered by Judicial Watch illustrate just how meddlesome the feds can be.

According to CNBC:

Negotiations to have JP Morgan take over Bear Stearns in March of 2008 produced an avalanche of emails from government officials. Worried that the collapse of Bear would trigger a world wide domino effect, the Federal Reserve and Treasury urged JP Morgan to take over Bear. The Fed went on to approve a $30 billion credit line to JPM to make the deal go through. The deal was formally announced on March 17, 2008. The emails here are correspondence between Fed and Treasury officials over the weekend of March 14 through the 16, 2008. They are a result of a Freedom of Information (FOIA) request by the group Judicial Watch.

Some of the names mentioned in these emails, which can be read their entirety here, include former President George Bush, former Treasury Secretary Paulson and current Treasury Secretary Tim Geithner.

Judicial Watch’s main goal with respect to the financial crisis is to make sure all government activities are completely transparent to the American people, especially now that the Obama administration plans to spend trillions more than first estimated on additional bailouts. (Bloomberg puts the total cost of the bailout at $8.5 trillion, which is a far cry from the $250 billion first proposed last fall.)

Of course, government officials would rather we all just go about our business and trust them to preside over the deal-making and fund disbursement. But since they’re the ones who helped get us into this mess we think it’s wise to keep an eye on them. So instead of looking the other way, we’re going to scrap to get our hands on documents related to the government’s dealings in the financial crisis.

Along these lines, as I told you few weeks ago, on January 26, 2009, Judicial Watch filed a lawsuit against the Treasury Department, seeking all records related to a meeting Paulson held with top bank officials on October 13, 2008, as the financial crisis was just getting started. During that meeting Paulson reportedly offered bank executives a deal they could not refuse, which certainly raised our eyebrows and our suspicions. We filed a FOIA immediately, and sued when the government stonewalled. Incredibly, the Treasury Department now says there are no responsive documents! One of the most important meetings at Treasury in the past decade and there are no related documents? I simply don’t believe it.

Stay tuned. With federal government power over the private sector increasing at an alarming rate, there is great potential for mischief. Judicial Watch will continue to investigate.

California Court Scandal Continues

How’s this for irony? California judges angered by a California court ruling in a Judicial Watch lawsuit recently persuaded lawmakers to create a new law that effectively invalidated the ruling! The new deal will allow these judges to accumulate millions of dollars annually in benefits and perks from Los Angeles County that they already receive from the state.

Here’s the scoop according to the February 20, 2009, edition of Cal Law:

After five round-the-clock days of legislative horse trading and stalemates, California’s judicial leaders scored two key political victories Thursday as state lawmakers finally closed a $40 billion budget deficit. Among the three-dozen bills legislators sent to Gov. Arnold Schwarzenegger’s desk to handle the shortfall was language that lets counties continue paying extra benefits to local judges. Proponents say that bill effectively overturns a 4th District ruling from October finding that only the state, not counties, can set compensation levels for judges… …Judges’ campaign to keep their extra benefits was a bold move at a time when state leaders were drafting deep cuts to education and social services programs.

Bold doesn’t quite capture it. This "double dipping" by trial court judges costs Los Angeles County taxpayers $20 million per year. And, again, these are benefits they already receive from state coffers, which is why the court ruled in our favor last October.

Let me give you just one example. Even though judges receive a full benefits package from the state, Los Angeles County also provides each judge $27,324 annually in cash allowances to purchase on a pre-tax basis additional health, life, disability and other benefits. Given that there are no requirements as to how the money must be spent, judges may either purchase the benefits or keep the cash allowance as taxable income. (The total cost of duplicate benefits for each judge is estimated to be $46,000.)

This latest piece of legislation, called the "Sturgeon fix bill" because it intends to overturn the victorious Judicial Watch lawsuit, Sturgeon v. County of Los Angeles.

Correct me if I’m wrong. But aren’t judges supposed to be interpreting the law, not paying big bucks to lobby a legislature to pass laws that benefit them? We’re still evaluating how any new law might affect our lawsuit (or whether new law is, in fact, constitutional). In the meantime, our lawsuit continues – and with more outrageous moves by the court.

The Superior Court of California for the County of Los Angeles ("State Court"), using a big name private law firm, recently sought to intervene as a defendant in our Sturgeon lawsuit. This is extraordinary and, frankly, beyond the lawful powers of the court. To give you a sense of the impropriety of this latest action, I’ll quote from our brief opposing the move:

If the State Court is allowed to intervene, the State Court would be litigating a matter before the State Court…the State Court’s intervention would create an irreconcilable conflict, as the litigation would be pending in the State Court, who would be a party. Plaintiff strongly objects to having the State Court consider whether the State Court should be allowed to intervene in a matter pending before the State Court.

If this doesn’t give you a sense that the court is out of control, I don’t know what would.

You can be sure we’re going to fight this judicial fix on behalf of California taxpayers.

Until next week…

Tom Fitton

President

Judicial Watch is a non-partisan, educational foundation organized under Section 501(c)(3) of the Internal Revenue code. Judicial Watch is dedicated to fighting government and judicial corruption and promoting a return to ethics and morality in our nation’s public life. To make a tax-deductible contribution in support of our efforts, click here.