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• JUNE 17, 2009

The White House Fires a Watchdog

The curious case of the inspector general and a Presidential ally.

President Obama swept to office on the promise of a new kind of politics, but then how do you explain last week's dismissal of federal Inspector General Gerald Walpin for the crime of trying to protect taxpayer dollars? This is a case that smells of political favoritism and Chicago rules.

A George W. Bush appointee, Mr. Walpin has since 2007 been the inspector general for the Corporation for National and Community Service, the federal agency that oversees such subsidized volunteer programs as AmeriCorps. In April 2008 the Corporation asked Mr. Walpin to investigate reports of irregularities at St. HOPE, a California nonprofit run by former NBA star and Obama supporter Kevin Johnson. St. HOPE had received an $850,000 AmeriCorps grant, which was supposed to go for three purposes: tutoring for Sacramento-area students; the redevelopment of several buildings; and theater and art programs.

Associated Press

Gerald Walpin, Inspector General of the Corporation For National and Community Service, was fired by President Barack Obama.

Mr. Walpin's investigators discovered that the money had been used instead to pad staff salaries, meddle politically in a school-board election, and have AmeriCorps members perform personal services for Mr. Johnson, including washing his car.

At the end of May, Mr. Walpin's office recommended that Mr. Johnson, an assistant and St. HOPE itself be "suspended" from receiving federal funds. The Corporation's official charged with suspensions agreed, and in September the suspension letters went out. Mr. Walpin's office also sent a civil and/or criminal referral to the U.S. Attorney for the Eastern District of California.

So far, so normal. But that all changed last fall, when Mr. Johnson was elected mayor of Sacramento. News of the suspension had become public, and President Obama began to discuss his federal stimulus spending. A city-hired attorney pronounced in March that Sacramento might be barred from receiving stimulus funds because of Mr. Johnson's suspension.

The news caused a public uproar. The U.S. Attorney's office, which since January has been headed by Lawrence Brown -- a career prosecutor who took over when the Bush-appointed Attorney left -- had already decided not to pursue criminal charges. Media and political pressure then mounted for the office to settle the issue and lift Mr. Johnson's suspension. Mr. Walpin agreed Mr. Johnson should pay back money but objected to lifting the suspension. He noted that Mr. Johnson has never officially responded to the Corporation's findings and that the entire point of suspension is to keep federal funds from individuals shown to have misused them.

Mr. Brown's office responded by cutting off contact with Mr. Walpin's office and began working directly with the Corporation, the board of which is now chaired by one of Mr. Obama's top campaign fundraisers, Alan Solomont. A few days later, Mr. Brown's office produced a settlement draft that significantly watered down any financial repayment and cleared Mr. Johnson. Mr. Walpin told us that in all his time working with U.S. Attorneys on cases he'd referred, he'd never been cut out in such fashion.

Mr. Walpin brought his concerns to the Corporation's board, but some board members were angry over a separate Walpin investigation into the wrongful disbursement of $80 million to the City University of New York. Concerned about the St. HOPE mess, Mr. Walpin wrote a 29-page report, signed by two other senior members of his office, and submitted it in April to Congress. Last Wednesday, he got a phone call from a White House lawyer telling him to resign within an hour or be fired.

We've long disliked the position of inspectors general, on grounds that they are creatures of Congress designed to torment the executive. Yet this case appears to be one in which an IG was fired because he criticized a favorite Congressional and executive project (AmeriCorps), and refused to bend to political pressure to let the Sacramento mayor have his stimulus dollars.

There's also the question of how Mr. Walpin was terminated. He says the phone call came from Norman Eisen, the Special Counsel to the President for Ethics and Government Reform, who said the President felt it was time for Mr. Walpin to "move on," and that it was "pure coincidence" he was asked to leave during the St. HOPE controversy. Yet the Administration has already had to walk back that claim.

That's because last year Congress passed the Inspectors General Reform Act, which requires the President to give Congress 30 days notice, plus a reason, before firing an inspector general. A co-sponsor of that bill was none other than Senator Obama. Having failed to pressure Mr. Walpin into resigning (which in itself might violate the law), the Administration was forced to say he'd be terminated in 30 days, and to tell Congress its reasons.

White House Counsel Gregory Craig cited a complaint that had been lodged against Mr. Walpin by Mr. Brown, the U.S. Attorney, accusing Mr. Walpin of misconduct, and of not really having the goods on Mr. Johnson. But this is curious given that Mr. Brown himself settled with St. HOPE, Mr. Johnson and his assistant, an agreement that required St. HOPE (with a financial assist from Mr. Johnson) to repay approximately half of the grant, and also required Mr. Johnson to take an online course about bookkeeping.

Iowa Republican Chuck Grassley, a co-sponsor of the IG Reform Act, is now demanding that the Corporation hand over its communications on this mess. He also wants to see any contact with the office of First Lady Michelle Obama, who has taken a particular interest in AmeriCorps, and whose former chief of staff, Jackie Norris, recently arrived at the Corporation as a "senior adviser."

If this seems like small beer, keep in mind that Mr. Obama promised to carefully watch how every stimulus dollar is spent. In this case, the evidence suggests that his White House fired a public official who refused to roll over to protect a Presidential crony.

Future Privacy Pizza

Senior Democrat Says Obama's Czars Unconstitutional

I have often wondered why the USA would want to use Czar (Russian for king/emperor) as a name of the head of anything. I thought the USA was against the use of kings. Wasn't this why George Washington served only 2 terms to avoid a king mentality in the new republic? It may have sounded cute at one time but is governing supposed to be cute? The article below sheds some light on the matter. -ed.

Senior Democrat Says Obama's Czars Unconstitutional
Ken Klukowski
Monday, June 15, 2009

Last week President Obama appointed yet another “czar” with massive government power, answering only to him. Even before this latest appointment, the top-ranking Democrat in the Senate wrote President Obama a letter saying that these czars are unconstitutional. President Obama’s “czar strategy” is an unprecedented power grab centralizing authority in the White House, outside congressional oversight and in violation of the Constitution.

As of last week, Czar Kenneth Feinberg has the authority to set the pay scale for executives at any company receiving government money (and how many aren’t, these days?). Czar Feinberg has the power to say that someone’s pay is excessive, and to make companies cut that pay until the czar is pleased.


Congress did not give Czar Feinberg this authority. For that matter, Congress has not authorized any of the czars that President Barack Obama has created. Over the past thirty years presidents have each had one or two czars for various issues, and once the number went as high as five. But now, by some counts President Obama has created sixteen czars, and there may be more on the way. Each of these has enormous government power, and answers only to the president.

Ever since this practice of appointing czars began years ago, it has always been considered possible that they are all unconstitutional. But it never built to a critical mass to elicit a court fight. These czars were few and far between, and rarely did anything that seriously ruffled any feathers. But President Obama has taken this to an unprecedented level, to the point where these appointments are dangerous to our constitutional regime.

This has become too much for the longest-serving senator in U.S. history to stomach. Democratic Senator Robert Byrd is the president pro tempore of the U.S. Senate. Even though Senate rules vest most powers in the Senate majority leader, the president pro tempore is a constitutional officer, and third in line to the U.S. presidency (after the vice president and the Speaker of the House). This office is held by a Democrat, who has been serving in the Senate since before Barack Obama was even born.

Senator Byrd wrote a letter to President Obama in February, criticizing the president’s strategy of creating czars to manage important areas of national policy. Senator Byrd said that these appointments violate both the constitutional system of checks and balances and the constitutional separation of powers, and is a clear attempt to evade congressional oversight. (Didn’t this White House promise unprecedented transparency?)

And Senator Byrd is exactly correct. The Constitution commands that government officers with significant authority (called “principal officers”) are nominated by the president but then are subject to a confirmation vote by the U.S. Senate. And principal officers include not only cabinet-level department heads, but go five levels deep in executive appointments, to include assistant secretaries and deputy undersecretaries.

Inferior officers are appointed either by the president, cabinet-level officers, or the courts. But even then, the Constitution specifies that only Congress can authorize the making of such appointments. For these inferior officers, only Congress can create their offices, and also specify who appoints them. And such officers are still answerable to Congress. They are subject to subpoena to testify before Congress, and Congress holds the power of the purse by making annual appropriations for their division or program.

White House officials, by contrast, cannot be compelled to appear before Congress and testify. They are alter-egos of the president himself, and as an agent of the Executive Office of the President they are entirely removed from Congress, and not answerable to Congress in any way. That was why during the Bush administration White House Chief of Staff Josh Bolten, Senior Advisor Karl Rove, and Counsel Harriet Miers could not be compelled to testify to Congress when President Bush invoked executive privilege (a battle they may well have won if they pressed their case all the way to the Supreme Court). Senior presidential aides advise the president alone, and the separation of powers forbids congressional interference in that relationship.

But that’s the problem with these czars. The president can have any advisors he wants, people who privately advise him or meet with others on his behalf, but have little or no actual authority to exert government power on anyone. These czars, however, are directly dictating policy, impacting millions of lives in the way that few assistant secretaries or deputy undersecretaries do.

The Founding Fathers specifically wrote the Constitution in a way to deny such absolute power to emanate from one person. That was why they required that no principal officers could exercise any power unless the U.S. Senate decided to confirm them. That was also why they specified that even for inferior officers only Congress could create their positions and could still require them to answer to Congress. The Founding Fathers were specifically blocking the type of centralized power that President Obama is currently exerting.

Fortunately, there is a remedy. Any person on the receiving end of an order from any of these czars has standing to challenge their constitutionality in court. Any person whose pay is deemed excessive by Kenneth Feinberg, or affected by any other czar, could file a federal suit asserting that the order is an unconstitutional exercise of government power, and

Fed Would Be Shut Down If It Were Audited, Expert Says

Fed Would Be Shut Down If It Were Audited, Expert Says

By: CNBC.com | 10 Jun 2009 |

The Federal Reserve's balance sheet is so out of whack that the central bank would be shut down if subjected to a conventional audit, Jim Grant, editor of Grant's Interest Rate Observer, told CNBC.

With $45 billion in capital and $2.1 trillion in assets, the central bank would not withstand the scrutiny normally afforded other institutions, Grant said in a live interview.

"If the Fed examiners were set upon the Fed's own documents—unlabeled documents—to pass judgment on the Fed's capacity to survive the difficulties it faces in credit, it would shut this institution down," he said. "The Fed is undercapitalized in a way that Citicorp is undercapitalized."

Grant said he would support legislation currently making its way through Congress calling for an audit of the Fed.

Moreover, he criticized the way the Fed has managed the financial crisis, saying the central bank's target rate should not be around zero.

"I think zero is the wrong rate for almost any economy," Grant said, adding the Fed has "embarked on a vast experiment in moral hazard. Interest rates are the traffic signals in a market economy, and everything's green. ... You have to wonder whether these interest rates are the right clearing rate or rather they are the imposition of a central bank."

Amid a disparity between analysts predicting there will be no rate hikes soon and the fed funds futures indicating tightening by the end of the year, Grant said he thinks the Fed indeed will begin raising rates as inflation creeps into the picture.

Fed funds futures have fully priced in as much as a half-point rise in the target rate from its current range of zero to 0.25 percent.

"If the hairs on the back of your neck stand up when there's too much unanimity of opinion, then one begins to worry about this," he said. "The Fed proverbially has been late."

great idea energy savings

If every home that has a natural gas line were equipped with a small generator that ran on natural gas, emissions would tumble. Firstly, because CH4 is a much cleaner burning fuel than, say, coal. And secondly, transmission losses from large centralized generation plants would become forfeit.

It’s relatively simple, really. All you need to do is commercialize a home-based generator. Standardize the attachments to the meet the gas regulations already dictating what pipes go where, so that it can simply replace an old water heater, or hook into someone’s basement. Then, put a capacitor in there somewhere: Boom, electricity on demand.

You would be powering your own home. Sure, your natural gas bill would be higher. But you’d pay zero in electricity costs. Meanwhile, national emissions go down across the board, and coal and nuclear become obsolete.

Danish inventor of new non toxic flame blocker

VIDEO: THE GREAT GLOBAL WARMING SWINDLE

It does start rather slow but I recommend watching the whole documentary. There are 2 significant points that may be of interest for those who want to get to the meat of it. 1.) At 20 min.:35sec. It is shown that CO2 data was miss read by Al Gore. CO2 increases lag behind warming periods by 800 years on average. So, CO2 is not a cause but an effect of increased global temperatures. 2.) at 28min.:42sec. There is an alternative theory, which seems sound, that sun activity is causing global warming. Hope that helps there is more info than this but they are what I feel are significant.