Newsweek Highlights More Revelations from "Throw Them All Out"

In this week’s edition of Newsweek, Peter Boyer takes a look at the new book by Peter Schweizer, “Throw Them All Out” and uncovers even more revelations about the way US lawmakers conduct their own personal business from their seats of public “service.” He writes:

While examining trades made around the time of the 2003 Medicare overhaul, Schweizer experienced what he calls his “Holy crap!” moment. The legislation, which created a new prescription-drug entitlement, promised to be a huge boon to the pharmaceutical industry—and to savvy investors in the Capitol. Among those with special insight on the issue was Massachusetts Sen. John Kerry, chairman of the health subcommittee of the Senate’s powerful Finance Committee. Kerry is one of the wealthiest members of the Senate and heavily invested in the stock market. As the final version of the drug program neared approval—one that didn’t include limits on the price of drugs—brokers for Kerry and his wife were busy trading in Big Pharma. Schweizer found that they completed 111 stock transactions of pharmaceutical companies in 2003, 103 of which were buys.

“They were all great picks,” Schweizer notes. The Kerrys’ capital gains on the transactions were at least $500,000, and as high as $2 million (such information is necessarily imprecise, as the disclosure rules allow members to report their gains in wide ranges). It was instructive to Schweizer that Kerry didn’t try to shape legislation to benefit his portfolio; the apparent key to success was the shaping of trades that anticipated the effect of government policy.

Senator Kerry’s office responded:

“Senator Kerry does not buy, sell, or trade stocks,” says Jodi Seth, Kerry’s spokeswoman. She notes that Kerry’s holdings are in family trusts and managed by independent trustees with whom he does not communicate. Further, Seth says, Kerry is not a beneficiary of Teresa Heinz Kerry’s trusts, which were established before they were married. In any case, Seth adds, Kerry was running for president when the Medicare bill was passed, and he missed much of the debate.

Schweizer replied:

“It’s not that I think John Kerry is calling up his broker, on health care, and saying, ‘Buy this company, sell that company,’?” Schweizer says. “The issue is one of a double standard.” He notes that if the executive of a health-care company were in discussions with the White House over pending legislation that would affect his industry, and then made a series of unusual stock transactions related to the industry, the SEC might well open an insider-trading investigation. “The only group in America that we exempt is politicians, who are probably the last people about whom we should be saying, ‘Oh, we’ll take their word for it,’?” he says. “That’s what’s so amazing to me.”

The article continues:

The Kerry trustees’ impeccable timing in drug company trades was evident again in 2007, when the federal government was weighing whether to discontinue Medicare reimbursement for certain anemia drugs used by cancer patients. When the government announced that it would limit reimbursements, shares in Amgen, one of the drugmakers at issue, dropped 15 percent. Kerry’s wife happened to be an Amgen stockholder but avoided losses; her shares, valued at between $500,000 and $1 million, were unloaded more than a week before the government’s announcement.

Schweizer, an unabashed conservative and a foreign-policy adviser to Sarah Palin, has written books about Reagan and the Bushes as well as polemics about the ruinous ways of liberalism. But this latest book is not an overtly partisan work; as the title, Throw Them All Out, suggests, it should discomfit conservatives and liberals, Democrats and Republicans, alike…

Boyer then moves on to the underhanded activities of Rep. Spencer Bachus, of Alabama:

One of the more dramatic episodes in the book recounts the trading activity of Republican Rep. Spencer Bachus, of Alabama, who, as the ranking member of the House Financial Services Committee, was privy to sensitive high-level meetings during the 2008 financial crisis and proceeded to make a series of profitable stock-option trades.

Bachus was known in the House as a guy who liked to play the market, and in fact he was pretty good at it; one year, he reported a capital gain in excess of $150,000 from his trading activities. More striking is that Bachus boldly carried forth his trading in the teeth of the impending financial collapse, the nightmarish dimensions of which he had learned about first-hand in confidential briefings from Treasury Secretary Henry Paulson and Fed chairman Ben Bernanke. On Sept. 19, 2008, after attending two such briefings, Bachus bought options in an index fund (ProShares UltraShort QQQ) that effectively amounted to a bet that the market would fall. That is indeed what happened, and, on Sept. 23, Bachus sold his “short” options, purchased for $7,846, for more than $13,000—nearly doubling his investment in four days.

Around the time Congress and the Bush administration worked out a TARP bailout, Bachus made another options buy and again nearly doubled his money. The House turned down the TARP proposal, and Bachus’s own Financial Services Committee remained clued in to revisions of what became the final TARP package. In the earlier closed-door briefings, Bernanke had warned the congressional members that a “meltdown in the global financial system” was imminent and that it would spill over into the broader economy if something wasn’t done. With TARP completed, Bachus seemed confident in its effect, now buying options that effectively bet that the market would rise—to mixed results.

Bachus was hardly the only member of Congress trading as the government was coming to grips with the financial crisis. After the first briefing from Bernanke and Paulson, brokers for Democratic Congressman Jim Moran, of Virginia, and his wife sold their shares in 90 companies, dodging the losses that others who stayed in the market would soon face. Republican Rep. Shelley Capito, of West Virginia, sold between $100,000 and $250,000 of Citigroup stock the day after the first meeting, recording capital gains on Citigroup transactions in that rocky period.

Let me just say that I stand with Andrew Breitbart and call on Representative Bachus to resign. Had he been a member of the general public, he would be going to prison for his actions. He’s a disgrace to this nation, as are all other members of Congress who engage in this behavior.

May I also remind C4P readers that Rep. Bachus was the man who blamed Governor Palin for the GOP not taking over the Senate in 2010. Never mind his twisted reality, at least we now know why he took that cheap shot at her… He’s one of them.

You can go here to read the entire Boyer article where he also covers more detail concerning Nancy Pelosi’s very profitable Visa IPO.

My Review of 'The Undefeated'

I had the honor last weekend to preview Steve Bannon's new documentary "The Undefeated," based primarily on Governor Palin's political life. When Mr. Bannon was asked recently by Kathryn Jean Lopez, why he "was keen on telling her story," he replied:

This woman is one of the most covered individuals in our media-saturated “global village,” yet I felt that she was totally unknown. The real person was hiding in plain sight.

As a C4P contributor, and supporter of Governor Palin's since first learning about her in late 2007, I can say that he is absolutely correct about that. It is why I have used the word "distortion" so often in my writings. The media has covered Governor Palin virtually every day since the presidential election in 2008, yet only now are Americans starting to learn about her actual record. It's a shame that it took so long, and it's amazing how it all came about, but at least the truth is finally up for discussion, in more places than just pro-Palin comment boards.

The film starts off with a shocking display of hatred in various forms, directed towards Governor Palin by the left. It was nothing I hadn't seen before, but I'm sure most Americans are unaware of the actual level of vitriol that Governor Palin and her family have been subjected to. By putting this segment at the very beginning of the movie, Bannon grabs the attention of the viewer, letting them know all about it by giving them a taste.

The movie describes why and how Governor Palin got involved in politics in the first place. It touches on her years in the city council, and goes into great detail about her time as Wasilla Mayor, chair and ethics officer of the of the Alaska Oil and Gas Conservation Commission, and Governor of Alaska. They interview many familiar (to C4P readers) faces who worked with Governor Palin, and were a big part of her administration.

During the portion of the film that covers Alaska, viewers get to see Governor Palin's courage and ethical principles on full display. Those who have no knowledge about the governor (other than moronic Tina Fey skits) will get to see the reformer we know. They will learn how she rose to power on her own accord, without being backed by the Alaska GOP establishment, then how she took them on to clean up her state's government. They will learn about her enormous approval ratings, and learn why. The film goes into great detail about her policy accomplishments, and viewers will no doubt have a better understanding of energy, it's relationship to Alaska, and the importance of domestic production after seeing the film.

The movie briefly covers the 2008 presidential campaign, and highlights Governor Palin's significance to the Republican ticket. They touched on the country's economic collapse during that time, and the subsequent loss for McCain-Palin. The more important part of the film follows, as some Americans will learn for the first time what happened to Governor Palin when she returned to Alaska following the election.

Viewers get to see the litany of attacks she faced, the avalanche of frivolous claims, the costs to her family and state, and a legislature more interested in playing partisan games against her than working for the people, after she returned from the campaign trail. People who see this movie will have little doubt that the reason Governor Palin resigned from the governorship was for the sake of Alaska, even if it cost her political career.

The movie goes on to tell the story of Governor Palin and the conservative movement since her resignation. They make the obvious comparison with the Reagan Revolution, and note how the governor has encouraged so many to get involved in the process. Showing her leading the charge in many instances taking on the left, while simultaneously keeping the national GOP on notice.

The movie is two hours long, which is considered lengthy for the subject matter. But I can tell you that it doesn't feel like two hours after you've watched it. Due to the structure and content, the movie holds your attention the entire time. It also has some great original footage most have never witnessed. I appreciated this film to no end, and like Dan Riehl, I even teared up at one point when Andrew Breitbart was speaking.

The Undefeated is a story about a courageous, modern-day political reformer but more importantly, it is a story about a survivor. It is the true story of Governor Palin and what she represents as most Americans have never seen before. I strongly recommend that they do when the film comes out on July 15.