The Obfuscation Report

CASE# / DATE NAME / CASE TYPE

718165 DEFENDANT ORLY TAITZ
09/30/1993 MALPRACTICE – DENTAL

S41640 RESPONDENT ORLY TAITZ
02/27/1998 SMALL CLAIMS APPEAL

00CC11017 DEFENDANT ORLY TAITZ
09/14/2000 MALPRACTICE – DENTAL

03CC04813 DEFENDANT ORLY TAITZ
03/25/2003 MALPRACTICE-MEDICAL

03CC12382 DEFENDANT ORLY TAITZ
10/10/2003 BREACH OF CONTRACT/WARRANTY

03CC12364 DEFENDANT ORLY TAITZ
10/09/2003 MALPRACTICE – DENTAL

04CC05196 DEFENDANT ORLY TAITZ
04/23/2004 BREACH OF CONTRACT/WARRANTY

04CC06308 DEFENDANT ORLY TAITZ
05/28/2004 CONTRACT – SPEC PERFORMANCE

AP14265 APPELLANT ORLY TAITZ
12/16/2004 MISC COMPLAINTS – OTHER

05CC12538 DEFENDANT ORLY TAITZ D.D.S 11/23/2005 MALPRACTICE-MEDICAL

06CC12669 DEFENDANT ORLY TAITZ D.D.S. 12/06/2006 MEDICAL MALPRACTICE

Disbarment of Orly Taitz Sought by California Bar

Even though any questions about President Obama's eligibility to serve as President were put to rest last June with the release of certified proof of his birth in Honolulu, Hawaii on August 4, 1961, which proof has been accepted and validated by the Governor of Hawaii, the United States Congress, former Vice President cheney, over twenty United States District Courts and the United States Supreme Court on at least five separate occasions, some extremists have refused to let the matter die. Just recently, an April Fool's Hoax alleging that the President claimed Indonesian citizenship in his college days, began circulating around the internet.

FINALLY there seems to be a chance that the madness will soon end. The Chief Trial Counsel of the State Bar of the State of California has filed a complaint against Orly Taitz, one of the more outspoken of the conspiracy obsessed, a woman who was unable to gain entry to an Accredited Law School and whose career seems to consist mainly of frivolous attacks on anyone within range. With luck, and with the wisdom that the Courts have unanimously shown when dealing with this ludicrous issue, Ms. Taitz will soon no longer be a practicing attorney. We can only hope it comes soon.

A PDF link to the entire complaint can be found on this site:

http://www.obamaconspiracy.org/2009/04/complaint-against-orly...

Below, I reprint only the Preface to the Complaint. For details, consult the full complaint (it is approximately 30 pages long).

Complaint to the State Bar of California

IN RE: ORLY TAITZ
STATE BAR NO. 223433

Office of the Chief Trial Counsel/Intake
The State Bar of California
1149 South Hill Street
Los Angeles, California 90015-2299

Preface

A California attorney has decided that President Obama is ineligible to be president, and has taken on the mission of removing him from office -- by force, if necessary. On at least two occasions, she has openly called for armed rebellion by the military, to arrest and imprison the elected President.

Her name is Orly Taitz. Using the power of the Internet, including blogs, online radio and television shows, and YouTube, she has become the national leader of a fringe movement. She has literally thousands of followers who think she is waging a lonely battle to uphold the Constitution, in the face of a conspiracy to place a usurper in the White House. Because her cause is so important, she has ignored the laws of the United States, established court procedures, and specifically, the California Rules of Professional Conduct. Specific violations are alleged below.

She has filed three lawsuits in California (two of which have been dismissed), and unsuccessfully attempted to file a fourth in federal court in Washington, D.C. Having been unable to achieve her goal by legal action, she has begun encouraging her followers nationwide to organize themselves as wholly unlawful "Citizens Grand Juries," and making "presentations" to lead them in indicting President Obama on criminal "charges". Already, a group of citizens in Georgia issued an "indictment" of the President, and "served" it on government officials, threatening violence if their "indictment" was ignored. Another such "indictment" is coming in early May, under her direction. In addition:

1. She has accused the following federal officials of treason and called for their indictments:

a) All the justices of the Supreme Court,
b) All the members of the U.S. House of Representatives and Senate,
c) Attorney General Eric Holder, Solicitor General Elena Kagan, and other federal officers,
d) and, of course, President Obama himself.

2. She has personally confronted two Supreme Court justices, when they made public appearances. On both occasions, she improperly tried to engage them in improper ex parte discussion of her case before the Court.

3. At her confrontation with Chief Justice Roberts, she gave two suitcases full of documents to his security detail, later claiming that she had "filed" a Motion for Reconsideration in one case, and a new lawsuit -- though she paid no filing fee, failed to file with the clerk's office, and showed no proof of service on opposing counsel. When her documents were not placed on the Supreme Court docket, she accused Justice Roberts of further treason and demanded his resignation.

4. She has openly encouraged and advised these unlawful "Citizens Grand Juries". In Georgia on March 28, she "presented the case" before a "Citizens Grand Jury" of 25 people, who then issued an indictment of President Obama on charges of fraud. The "indictment" was then "served" on the U.S. Attorney for the Northern District of Georgia, and on the Georgia Attorney General, on Georgia's Speaker of the House, and on Georgia's President of the Senate.

http://www.riseupforamerica.com/index.html

She apparently also plans to "do the presentation," as if a prosecutor, at the "Illinois Citizen's Federal Grand Jury" on May 2. http://americangrandjury.org/grand-jury-updates-from-georgia-... She believes she's some sort of "National Prosecutor" at these "Fake Grand Juries," and more will surely follow.

5. She has recruited dozens of active and retired military for her crusade, including retired Major General Carroll D. Childers. She published (and thus, endorsed) his statement about President Obama that:

"He is an interloper, a usurper, a fake, a scam artist, a Chicago crook, a recipient of bribes and gratuitous income for which he paid no tax, a socialist (perhaps only a communist or Marxist), and a grave danger to the future of America ... [Congress and the Supreme Court] are all complicit and should all be severely punished for having failed in their sworn oath to protect and defend the constitution ... [instead of swearing him into office, Justice] Roberts ... should have immediately had Obama arrested and deported.

"Other than this, my key short-term complaint is that he has not had a heart attack in office."

http://defendourfreedoms.us/2009/02/24/major-general-commandi...

6. On April 4, she attended a "Machine Gun Shoot" in Kentucky, where she actively recruited plaintiffs for her various actions and was at least partially successful. According to her own accounting, she signed up at least 20 new "plaintiffs for my legal actions," presented "a case for fraud" against President Obama in a public appearance with the man who convened the Georgia "Citizens Grand Jury," and collected "at least 300 signed indictments". However, upon information and belief, she is not licensed to practice law in the State of Kentucky.

7. She repeatedly instructs her followers to write, call, and otherwise harrass the U.S. Supreme Court, federal courts, U.S. Attorneys, and other governmental officials, demanding that they investigate the President, arrest, and imprison him. On March 14, she wrote:

[I have been] criss crossing this country talking to Justices of the Supreme court, Representatives, Senators, FBI agents, Attorney Generals, US attorneys, telling all of them, what is wrong with you? Did some evil magician put a spell on the men in this country and they stopped being men? Why are you afraid to speak up, to stand up for you constitution? Why are you afraid to tell this arrogant jerk from Africa and Indonesia - You need to go home, you cannot be a president and commander in chief because you are not a Natural born Citizen. To be a Natural born Citizen you have to have both parents as citizens. Your father was never a US citizen and you don't qualify and you also spit us in the face by refusing to unseal your vital records. There is no proof that you are even a citizen. For all we know, you need to go back to Kenya and wait for your green card, and that after we try you for all the crimes perpetrated upon American citizens.

http://defendourfreedoms.us/2009/03/14/i-did-it.aspx

By openly advocating armed revolt, accusing virtually the entire federal government of treason, and using poisonous invective against President Obama, she is making it significantly more likely that someone will attempt to assassinate the President of the United States. I recognize that, however distasteful, many of her actions are likely protected by the First Amendment. However, in her capacity as a California attorney, she has violated numerous Rules of Professional Conduct, as detailed below.

Conservative Democrats Most Vulnerable If Health Reform Fails

by Sahil Kapur at HuffPO

The failures of Democrats to overhaul health care under Clinton and Harry Truman both led to dramatic Republican gains in the following elections, with Democrats losing their control of Congress both times.

"A lot of the conservative Democrats who voted against [Clinton's health care] bill got swept out in 1994," Lux said. Republicans gained 54 additional seats in the House of Representatives and eight in the Senate that year -- mostly in conservative states and swing districts -- regaining control of Congress for the first time in half a century.

The influential conservative Democrats who are combating their own party's efforts to overhaul health care could ironically wind up being among the biggest losers if the effort to pass comprehensive legislation founders too badly.

Health care reform is so central to the Democratic agenda that its collapse could gravely damage the party's stature in 2010.

The self-styled fiscal conservatives who call themselves Blue Dogs in the House fear the effects of being labeled as liberals in their predominantly right-leaning districts. But history suggests that they should be more afraid of fueling a Republican electoral resurgence.

"If [President] Obama's popularity and the Democratic party's approval rating goes downhill, that will hurt the Blue Dogs and those in conservative districts more than anybody else," Mike Lux, a progressive political strategist, told the Huffington Post.

In previous elections, the prospects of conservative Democrats in both the House and Senate have been strongly linked to the overall popularity of their party.

In 2006 and 2008, the fiscally conservative Blue Dogs, gained 15 seats -- mostly in conservative districts -- while capitalizing on high Democratic popularity across the nation. During the same period, 11 of the 14 Democratic gains in the Senate were in conservative or toss-up states. By contrast, in the 2002 and 2004 elections, when Republicans added to their majorities in both chambers, their pickups were mostly in conservative and swing states.

There's also a precedent for health care being a make-or-break issue for Democrats.

"The reason we lost so badly in '94," said Lux, who was an adviser to Bill Clinton at the time, "was that working class voters of medium and low incomes -- who turned out in big numbers in 1992 -- were incredibly discouraged by us not delivering on health care."

Meanwhile, Michael Tomasky writes in the Guardian that most of the Blue Dogs shouldn't be so fearful, period.

"To hear them talk sometimes, you'd think if they depart one iota from a basically conservative agenda, the voters will toss them out," he writes.

But Tomasky's elaborate analysis of the 2008 election results suggests that very few of them are really in danger of being voted out of office for being too liberal.

"Yes, some Democrats have to be very careful and not be seen as casting a liberal vote. But they're a comparatively small number," he concludes. "A very clear majority of these people have won by large enough margins that it sure seems to me they could survive one controversial vote if they [put] some backbone into it."

Professor’s Arrest Tests Beliefs on Racial Progress

By SUSAN SAULNY and ROBBIE BROWN

CHICAGO — Ralph Medley, a retired professor of philosophy and English who is black, remembers the day he was arrested on his own property, a rental building here in Hyde Park where he was doing some repair work for tenants.

A concerned neighbor had called the police to report a suspicious character. And that was not the first time Mr. Medley said he had been wrongly apprehended. A call Mr. Medley placed to 911 several years ago about a burglary resulted with the police showing up to frisk him.

“But I’m the one who called you!” he said he remembers pleading with the officers.

Like countless other blacks around the country, Mr. Medley was revisiting his encounters with the police as a national discussion about race and law enforcement unfolded after the arrest of Henry Louis Gates Jr., Harvard’s prominent scholar of African-American history. Professor Gates was arrested for disorderly conduct July 16 at his home in Cambridge, Mass., as the police investigated a report of a possible break-in there. The charge was later dropped, and the Cambridge Police Department said the incident was “regrettable and unfortunate.”

In interviews here and in Atlanta, in Web postings and on television talk shows, blacks and others said that what happened to Professor Gates was a common, if unacknowledged, reality for many people of color. They also said that beyond race, the ego of the police officer probably played a role.

But more deeply, many said that the incident was a disappointing reminder that for all the racial progress the country seemed to have made with the election of President Obama, little had changed in the everyday lives of most people in terms of race relations.

“No matter how much education you have as a person of color, you still can’t escape institutional racism,” said Keith E. Horton, a sports and entertainment lawyer in Chicago who is black. “That’s what the issue is to me.”

To be sure, people have found fault with how Professor Gates responded to the arresting officer, Sgt. James Crowley, who said he was simply fulfilling his duty in investigating the report of a burglary in progress.

The police and Professor Gates offered differing accounts of what happened after officers arrived. The police said Professor Gates initially refused to show identification and repeatedly shouted at officers. Professor Gates said that he had shown photo identification to Sergeant Crowley but that the sergeant had not appeared to believe that he lived there. He also said he had brought up race during the confrontation but was not disorderly.

Many comments posted online suggested that Professor Gates, 58, had made a tricky situation worse by not easily cooperating. Even some blacks acknowledged that he did not help himself by refusing to show deference to a police officer.

“It is unwise for anyone of any race to raise their voice to a law enforcement officer,” said Al Vivian, a diversity consultant in Atlanta who is black. “But the result at the end of the day is this was a man who violated no law, was in his own house, who is the top academic star at the top academic school in the nation, and he was still taken away and arrested.”

At a news conference on Wednesday night, President Obama said he thought the Cambridge police had “acted stupidly” in the arrest of Professor Gates.

“I think it’s worse than stupid,” said Mr. Medley, 65, the retired Chicago professor. “I think it was mean-spirited and ill-intended.”

In interviews, blacks and whites of various ages and experiences with law enforcement showed a tendency to give a benefit of the doubt to Professor Gates over the police.

“It seems to me that Dr. Gates was simply arrested for being upset, and he was arrested for being upset because he’s a black man,” said Wayne Martin, 25, an official at the Atlanta Housing Authority, who is also black.

The way Mr. Martin described himself, he could be the very definition of a “post-racial” American. “I have children I’m trying to raise not to see race,” he said. “I’m beyond the whole black-white thing. It doesn’t matter to me.”

Yet Mr. Martin could not think of any other way than racism to explain what had happened to Professor Gates. He is fascinated by the story. On Wednesday, he changed his Facebook status to: “Wayne Martin is wondering when it became illegal to be angry at a law enforcement official.”

Mr. Martin said that he was heartened to see Mr. Obama — who said he was a friend of Professor Gates — address the issue, and that while he agreed with Mr. Obama’s interpretation of the incident, he thought the word “stupidly” had been poorly chosen.

“That choice of the word was something that I don’t agree with,” Mr. Martin said. “To use such a common offensive term, it almost lowers him down to the level of the folks he’s wagging his finger at.”

Sabine Charles, 37, a white cardiologist who lives in Hyde Park, is married to a black man and said that she could not count how many times people had interrupted the two over the years to ask her, quietly, “Is this man bothering you?”

“I say, ‘Guess what? He’s not! We’re actually on a romantic date, can’t you tell?’ ” she said. “Even here in this diverse area I’ve heard people say, ‘Look at those black guys coming toward us.’ I say, ‘Yes, but they’re wearing lacrosse shorts and Calvin Klein jeans. They’re probably the kids of the professor down the street.’ ”

“You have to be able to discern differences between people,” she said, criticizing the practice of racial profiling. “It’s very frustrating.”

Mr. Vivian, the diversity trainer in Atlanta, said that what happened to Professor Gates was “age old” in America, but that what was different this time was that it happened in a so-called post-racial America.

Mr. Vivian, 47, said that he had been unfairly stopped by the police in the past, but that he lived by “an unwritten code” for dealing with these incidents. And Dr. Gates certainly did not obey the code, he said.

Quiet politeness is Rule No. 1 in surviving an incident of racial profiling, he said. So is the frequent use of the word “sir.”

“People used to say, ‘Look, there’s a Colin Powell. There’s an Oprah Winfrey.’ Now they say, ‘There’s a black president.’ I say, I’m happy to see the exceptions. There’s always an exception. But I’m interested in how society treats the average person.”

That there is a well-known code of behavior familiar to most minorities who are stopped by the police, Mr. Vivian said, is testament enough of a problem.

“It clearly says that we have a lot of work to do,” he said.

Susan Saulny reported from Chicago, and Robbie Brown from Atlanta.

July 22nd, 2009 5:45 pm
Autos, banks spend $20M lobbying

By Silla Brush / Hill

Auto companies and eight of the country's biggest banks that received tens of billions of dollars in federal bailout money spent more than $20 million on lobbying Washington lawmakers in the first half of this year.

General Motors, Chrysler and GMAC, the finance arm of GM, cut back significantly on lobbying expenses in the period, spending about one-third less in total than they had in the first half of 2008.

But the eight banks, the earliest recipients of billions of dollars from the federal government, continued to rely heavily on their Washington lobbying arms, spending more than $12.4 million in the first half of 2009. That is slightly more than they spent during the same period a year ago, according to a review of congressional records.

The heavy lobbying comes as President Obama and congressional lawmakers work to overhaul the financial system and the auto industry undergoes a dramatic restructuring that has already witnessed GM and Chrysler pass through historic bankruptcy proceedings.

As lawmakers turn their attention to enacting major changes to the regulatory system, the financial industry is at a crossroads. Some smaller and regional banks continue to show considerable signs of weakness while several big Wall Street banks announce multibillion-dollar profits.

Those big banks traditionally are among the most active Washington lobbying interests in the financial industry, and the recession has done little to dent their spending. Major banking interests maintain it's important to have a seat at the table as lawmakers chart such large changes. Since last fall, companies receiving government funds have argued that none of the taxpayer money they were receiving was being spent on lobbying.

Still, lawmakers have pushed back hard on companies that continued to lobby, with some targeting the banking industry for scuttling legislative efforts while relying on government help. Democratic leaders blamed the industry when a major bankruptcy bill failed to pass the Senate earlier this year.

The bill would have empowered bankruptcy judges to rewrite the terms of primary home mortgages. Industry groups were stridently opposed to the effort, which they dubbed "cramdown."

Some of the biggest banks are also among the more than 30 that have already moved to repay funds from the Troubled Asset Relief Program (TARP), the formal name for the bailout package Congress passed last October. More than $70 billion has been repaid to the federal government.

Six of the eight banks spent more to try to sway lawmakers in the first half of 2009 than over the same period in 2008, before the worst of the financial crisis took hold. The eight banks include: Citigroup, JPMorgan Chase & Co, Bank of America, Goldman Sachs, Morgan Stanley, Wells Fargo, State Street and Bank of New York Mellon.

JPMorgan was the top spender, at $1.76 million in the second quarter and $3.07 million in first half of the year. That is roughly 20 percent more than the bank spent on lobbying in the first half of 2008.

Citigroup, which has yet to repay any of the $50 billion in bailout money it has received, was the second highest, at $1.67 million in the quarter and $2.92 million in the first half. A spokesman for Citigroup declined to comment.

Only Bank of America and Goldman Sachs spent less on lobbying during the first six months of 2009 compared to the first half of 2008.

GM spent $5.56 million on lobbying in the first half of 2009, compared with $7.08 million in the same period in 2008. GM also has dropped a dozen lobbying contracts.

"GM's spending is proportional to its activity," said Greg Martin, GM's spokesman. "At any given time, GM is engaged with policymakers on a variety of complex policy issues with significant economic and competitive consequences to individual automotive companies."

Chrysler has continued its outside lobbying contracts after establishing itself as a legally new company during the bankruptcy proceeding. Chrysler spent $1.42 million in the first half of the year, compared with $2.78 million a year ago. GMAC spent $660,000 this year, compared with $1.15 million a year ago.

American International Group, the insurance firm crippled by trades in financial derivatives that received roughly $180 billion in bailout commitments, closed its Washington lobbying shop earlier this year. AIG continues to spend money on counsel to answer requests for information from the federal government, but the firm said it does not lobby on federal legislation.

The Birther Movement are the fringe right wing morons who believe that President Barack Obama was not born in the United States. They believe that there is a vast conspiracy that is covering up the fact that he was born in Kenya. President Obama, and the State of Hawaii, and the Kapi'olani Medical Center in Hawaii, all claim that President Obama was born in Hawaii.

The Hilarious part about the birther movement, is that even if what they say is true, President Obama is still a Natural Born Citizen.

According to the Wingbats, Obama was born in Kenya, to a U.S. Citizen Mother and a Kenyan Father.

Under the laws of the United States at the time of Barack Obama's Birth, a person born outside the United States, to a U.S. Citizen Mother and an alien father, acquires Citizenship AT BIRTH. The only exception to this is if his mother did not live in the U.S. for at least 10 years prior to his birth. Which has never been claimed by the wingbats.

The only saving grace for the wingbats is if they claim that a "natural born" citizen means that you must have been born on U.S. Soil. Ironically this would mean John McCain wouldn't have been eligible either. However, there is NO CASE LAW to support this definition of "Natural Born Citizen" and in fact the U.S. Constitution states the opposite.

However, for both John McCain and Barack Obama, U.S. Law is very clear on this matter... "the Citizenship Clause of the Fourteenth Amendment to the United States Constitution provides an additional source of constitutional doctrine stating that birth "in the United States" and subjection to U.S. jurisdiction at the time of birth, entitles one to citizenship:

“

All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside.

”

Obama Demands: The Bill I Sign Must Include Public Option
By Brian Beutler - July 20, 2009, 10:16AM

Industry Cash Flowed To Drafters of Reform
Key Senator Baucus Is a Leading Recipient

By Dan Eggen
Washington Post Staff Writer
Tuesday, July 21, 2009

As liberal protesters marched outside, Sen. Max Baucus sat down inside a San Francisco mansion for a dinner of chicken cordon bleu and a discussion of landmark health-care legislation under consideration by his Senate Finance Committee.

At the table on May 26 were about 20 donors willing to fork over $10,000 or more to the Democratic Senatorial Campaign Committee, including executives of major insurance companies, hospitals and other health-care firms.

"Most people there had an agenda; they wanted the ear of a senator, and they got it," said Aaron Roland, a San Francisco health-care activist who paid half price to attend the gathering. "Money gets you in the door. The only thing the other side can do is march around and protest outside."

As his committee has taken center stage in the battle over health-care reform, Chairman Baucus (D-Mont.) has emerged as a leading recipient of Senate campaign contributions from the hospitals, insurers and other medical interest groups hoping to shape the legislation to their advantage. Health-related companies and their employees gave Baucus's political committees nearly $1.5 million in 2007 and 2008, when he began holding hearings and making preparations for this year's reform debate.

Top health executives and lobbyists have continued to flock to the senator's often extravagant fundraising events in recent months. During a Senate break in late June, for example, Baucus held his 10th annual fly-fishing and golfing weekend in Big Sky, Mont., for a minimum donation of $2,500. Later this month comes "Camp Baucus," a "trip for the whole family" that adds horseback riding and hiking to the list of activities.

To avoid any appearance of favoritism, his aides say, Baucus quietly began refusing contributions from health-care political action committees after June 1. But the policy does not apply to lobbyists or corporate executives, who continued to make donations, disclosure records show.

Baucus declined requests to comment for this article. Spokesman Tyler Matsdorf said the senator "is only driven by one thing: what is right for Montana and the country. And he will continue his open process of working together with the president, his colleagues in Congress, and groups and individuals from across the nation to get this legislation passed."

Baucus's fundraising prowess underscores the enduring political strength of the health-care lobby, which led all other sectors in donations to federal candidates during the last election cycle and has shifted its giving to Democrats as the party has tightened its control of Congress.

The sector gave nearly $170 million to federal lawmakers in 2007 and 2008, with 54 percent going to Democrats, according to data compiled by the Center for Responsive Politics, which tracks money in politics. The shift in parties was even more pronounced during the first three months of this year, when Democrats collected 60 percent of the $5.4 million donated by health-care companies and their employees, the data show.

Many of these contributions have been focused on Baucus, Charles E. Grassley (R-Iowa) and other senators in the moderate camps of their respective parties, whose votes could prove crucial in a final health-care reform deal, as well as the leaders of five key committees leading the debate. Grassley, the Finance Committee's ranking Republican, received more than $2 million from the health and insurance sectors since 2003. House Ways and Means Chairman Charles B. Rangel (D-N.Y.) took in $1.6 million from the health sector and its employees over the past two years; ranking Republican Dave Camp (Mich.) received nearly $1 million.

But Baucus, a senator from a sparsely populated and conservative Western state who is serving his sixth term, stands out for the rising tide of health-care contributions to his campaign committee, Friends of Max Baucus, and his political-action committee, Glacier PAC. Baucus collected $3 million from the health and insurance sectors from 2003 to 2008, about 20 percent of the total, data show. Less than 10 percent of the money came from Montana.

Top out-of-state corporate contributors included Schering-Plough, New York Life Insurance, Amgen, and Blue Cross and Blue Shield; individual executives such as Richard T. Clark, chief executive and president of drugmaker Merck, have also made regular donations. Most of these companies, particularly major insurers, strongly oppose a public insurance option, which is favored by President Obama and top House Democrats but has not received support from Baucus's committee.

Baucus is a longtime centrist in the Democratic caucus, and his committee chairmanship has made him a key broker in the health-reform debate. Many former Baucus staff members, including two chiefs of staff, lobby on behalf of the pharmaceutical industry and other health-care players and have been closely involved in negotiations on the legislation.

John Jonas, a Patton Boggs health-care lobbyist who has attended a Baucus fly-fishing event and other fundraisers, said the Montana senator is "key to getting anything done" when it comes to health-care legislation.

"This is not an overwhelmingly liberal Congress, and it's certainly not a liberal Senate," said Jonas, whose clients include Bristol-Myers Squibb, Pfizer and Northwestern Mutual. "I think Max is uniquely situated to try to accomplish that, because he's more of a centrist and moderate Democrat than others are."

But Jerry Flanagan, a health-care analyst with Consumer Watchdog, a California-based advocacy group, said the tide of campaign contributions amounts to "a huge down payment" by companies that expect favorable policies in return. "That is the cold reality of big-money politics," he said.

Baucus won easy reelection in the fall, but he has continued to hold fundraisers since then. In addition to the fly-fishing event, he held his "Eighth Annual Ski and Snowmobile Weekend" in Big Sky in February and celebrated the start of his sixth term with a $10,000-a-table dinner at the Washington Court Hotel later that month. Aides say another fundraiser scheduled for July 7 at Bistro Bis in Capitol Hill was scrapped.

Baucus's office declined to provide attendance and donation details about his fundraising events, and federal records laws do not require such disclosures. Starting in June, aides say, Baucus adopted an internal office policy to refuse contributions from health-care PACs and to continue doing so until after Congress passes reform legislation.

But new Federal Election Commission documents filed last week show that individual lobbyists and others with health-care connections continued to make contributions to Baucus committees throughout June. Examples from Baucus's Glacier PAC include $5,000 from the Independent Insurance Agents and Brokers of America and $2,500 from lobbyists with U.S. Strategies, which represents numerous health-care firms. Overall, half of the $110,000 in donations to the PAC from April to June came from health-care firms and lobbyists, including Schering-Plough, Medtronic and New York Life.

Craig Holman, government affairs lobbyist for the Public Citizen advocacy group, said the continued fundraising by Baucus during the health-care debate is "very troubling."

"He's doing all this fundraising right in the middle of this effort to mark up a bill," Holman said. "When you put these events close to matters concerning these lobbyists, clearly it's a signal. You are expected to show up with a check."

Baucus and his aides strongly dispute any assertion that campaign contributions have an impact on the senator's policy views and proposals. Aides say he has frequently backed policies opposed by health-care companies, including support for greater availability of generic drugs, allowing drug imports from Canada and cutting payments to the Medicare Advantage plan.

During an interview earlier this year with the Missoulian newspaper, Baucus said that "no one gets special treatment." He added: "Your word is your bond back there."

Research editor Alice Crites contributed to this report.

The Joy of Sachs

By PAUL KRUGMAN

The American economy remains in dire straits, with one worker in six unemployed or underemployed. Yet Goldman Sachs just reported record quarterly profits — and it’s preparing to hand out huge bonuses, comparable to what it was paying before the crisis. What does this contrast tell us?

First, it tells us that Goldman is very good at what it does. Unfortunately, what it does is bad for America.

Second, it shows that Wall Street’s bad habits — above all, the system of compensation that helped cause the financial crisis — have not gone away.

Third, it shows that by rescuing the financial system without reforming it, Washington has done nothing to protect us from a new crisis, and, in fact, has made another crisis more likely.

Let’s start by talking about how Goldman makes money.

Over the past generation — ever since the banking deregulation of the Reagan years — the U.S. economy has been “financialized.” The business of moving money around, of slicing, dicing and repackaging financial claims, has soared in importance compared with the actual production of useful stuff. The sector officially labeled “securities, commodity contracts and investments” has grown especially fast, from only 0.3 percent of G.D.P. in the late 1970s to 1.7 percent of G.D.P. in 2007.

Such growth would be fine if financialization really delivered on its promises — if financial firms made money by directing capital to its most productive uses, by developing innovative ways to spread and reduce risk. But can anyone, at this point, make those claims with a straight face? Financial firms, we now know, directed vast quantities of capital into the construction of unsellable houses and empty shopping malls. They increased risk rather than reducing it, and concentrated risk rather than spreading it. In effect, the industry was selling dangerous patent medicine to gullible consumers.

Goldman’s role in the financialization of America was similar to that of other players, except for one thing: Goldman didn’t believe its own hype. Other banks invested heavily in the same toxic waste they were selling to the public at large. Goldman, famously, made a lot of money selling securities backed by subprime mortgages — then made a lot more money by selling mortgage-backed securities short, just before their value crashed. All of this was perfectly legal, but the net effect was that Goldman made profits by playing the rest of us for suckers.

And Wall Streeters have every incentive to keep playing that kind of game.

The huge bonuses Goldman will soon hand out show that financial-industry highfliers are still operating under a system of heads they win, tails other people lose. If you’re a banker, and you generate big short-term profits, you get lavishly rewarded — and you don’t have to give the money back if and when those profits turn out to have been a mirage. You have every reason, then, to steer investors into taking risks they don’t understand.

And the events of the past year have skewed those incentives even more, by putting taxpayers as well as investors on the hook if things go wrong.

I won’t try to parse the competing claims about how much direct benefit Goldman received from recent financial bailouts, especially the government’s assumption of A.I.G.’s liabilities. What’s clear is that Wall Street in general, Goldman very much included, benefited hugely from the government’s provision of a financial backstop — an assurance that it will rescue major financial players whenever things go wrong.

You can argue that such rescues are necessary if we’re to avoid a replay of the Great Depression. In fact, I agree. But the result is that the financial system’s liabilities are now backed by an implicit government guarantee.

Now the last time there was a comparable expansion of the financial safety net, the creation of federal deposit insurance in the 1930s, it was accompanied by much tighter regulation, to ensure that banks didn’t abuse their privileges. This time, new regulations are still in the drawing-board stage — and the finance lobby is already fighting against even the most basic protections for consumers.

If these lobbying efforts succeed, we’ll have set the stage for an even bigger financial disaster a few years down the road. The next crisis could look something like the savings-and-loan mess of the 1980s, in which deregulated banks gambled with, or in some cases stole, taxpayers’ money — except that it would involve the financial industry as a whole.

The bottom line is that Goldman’s blowout quarter is good news for Goldman and the people who work there. It’s good news for financial superstars in general, whose paychecks are rapidly climbing back to precrisis levels. But it’s bad news for almost everyone else.

Exclusive: Conservative group offers to sell endorsement for $2M
By: Mike Allen
July 17, 2009 05:07 AM EST

The American Conservative Union asked FedEx for a check for $2 million to $3 million in return for the group’s endorsement in a bitter legislative dispute, then flipped and sided with UPS after FedEx refused to pay.

For the $2 million plus, ACU offered a range of services that included: “Producing op-eds and articles written by ACU’s Chairman David Keene and/or other members of the ACU’s board of directors. (Note that Mr. Keene writes a weekly column that appears in The Hill.)”

The conservative group’s remarkable demand — black-and-white proof of the longtime Washington practice known as “pay for play” — was contained in a private letter to FedEx , which was provided to POLITICO.

The letter exposes the practice by some political interest groups of taking stands not for reasons of pure principle, as their members and supporters might assume, but also in part because a sponsor is paying big money.

In the three-page letter asking for money on June 30, the conservative group backed FedEx. After FedEx says it rejected the offer, Keene signed onto a two-page July 15 letter backing UPS. Keene did not return a message left on his cell phone.

Maury Lane, FedEx’s director of corporate communications, said: “Clearly, the ACU shopped their beliefs and UPS bought.”

ACU's executive vice president, Dennis Whitfield, said that neither the group nor David Keene, the chairman, took any money from UPS. Whitfield said the group has never received a response to its original proposal to FedEx. He said Keene endorsed the second letter as an individual, even though the letter bore the logo of ACU.

"Our position hasn't changed," said Whitfield, who was a deputy secretary of labor in the Reagan administration. "It won't change. I am fundamentally, philosophically opposed to doing what the Obama administration wants to do [to FedEx], and so is our organization."

FedEx and UPS, fierce competitors in the package delivery business, are at war over a provision under consideration in Congress that would expand union power at FedEx.

FedEx currently has one U.S. union contract for its entire express business. Under a change passed by the House and awaiting action in the Senate, FedEx — like UPS — would have to negotiate union contracts for individual locations, which FedEx claims would make it much more difficult to promise worldwide regularity for deliveries.

The American Conservative Union, which calls itself “the nation's oldest and largest grass-roots conservative lobbying organization,” took UPS’s side on Wednesday as part of a conservative consortium that accused FedEx of “misleading the public and legislators.” ACU's logo is at the top of the letter, along with those of six other conservative groups.

Just two weeks earlier, ACU had offered its endorsement to FedEx, saying in a letter to the company: “We stand with FedEx in opposition to this legislation.”

But there was a catch — an expensive one. ACU asked FedEx to pay as much as $3.4 million for e-mail and other services for “an aggressive grass-roots campaign to stop the legislation in the Senate.”

“For the activist contact portion of the plan, we will contact over 150,000 people per state multiple times at a cost of $1.39 per name or $2,147,550 to implement the entire program,” the letter says. “If we incorporate the targeted, senator-personalized radio effort into the plan, you can figure an additional $125,000 on average, per state” for an estimated 10 states. The total would be $3,397,550.”

The letter shows one reason why activists get so much junk mail, both on paper and electronically: Some groups that send it charge handsomely for the service.

Under the grass-roots program ACU proposed, “Each person will be contacted a total of seven times totaling nearly 11 million contacts total in the 10 targeted states.” “Within 72 hours of an agreement on the whole plan, we can have the data sets delivered and the first round of e-mail ready for delivery,” the offer states. “Within seven days, the mail can be in the USPS system and the phone call delivered.”

Lane, the FedEx official, said the offer was refused. "The proposal didn’t fit with our strategy of taking a straightforward approach to discussing the issue,” he said.

After the rebuff, American Conservative Union changed sides. ACU Chairman David A. Keene was one of eight conservative leaders who signed a letter to FedEx Chairman Frederick W. Smith, a champion of capitalism who in the past has been a favorite of conservatives.

The letter accuses FedEx of “falsely and disingenuously” labeling the rules change a “bailout” for UPS, since FedEx would become subject to the same arduous union structure.

The letter is also signed by Grover Norquist, president of Americans for Tax Reform, who is also on ACU’s board. FedEx is pushing its case with a website called www.BrownBailout.com.

The letter signed by the conservative leaders concludes: “To paraphrase the words of Ronald Reagan, ‘Mr. Smith, tear down this website.’”

Among the services ACU had offered to provide for the $2 million-plus price tag:

—Acquiring data of known conservatives in the targeted states (to be determined by FedEx), matching that data to an e-mail database and then incorporating those e-mail addresses with the current ACU e-mail database to create one targeted database of all potential activists.

—Sending a piece of targeted direct mail to these potential activists to ensure that they are well-educated prior to their contact with their senators.

—E-mailing the identified voter activists, in five rounds, in order to educate them on the issue(s) and to urge them to call their senators based on key dates. The ACU would include the phone number of their personal senators directly in the correspondence.

—Conducting targeted phone call campaign that will contact all voter activists to urge them to make a personal call to their senators. Each state would have a specialized message just for that state.

—Encouraging activists who live within 30 miles of a senator’s district office to consider making a personal visit to register their concerns at the office. ACU has proved that we can turn out well-informed, quality voters who present a good image to represent our concerns.

—As the vote for the legislation nears, distributing ACTION ALERT e-mails, and after the vote has taken place, distributing MegaVote e-mails to ACU’s members letting them know how their senators vote.

Chip Pickering's Wife Claims He Had An Affair

JACKSON, Miss. — The estranged wife of former U.S. Rep. Chip Pickering claims in a lawsuit that the Mississippi Republican had an affair that ruined their marriage and derailed his political career.

Leisha Pickering said in the lawsuit filed this week that her husband and the woman dated in college, reconnected and began having an affair while he was in Congress and living in a building where several Christian lawmakers reside on C Street near the U.S. Capitol. Chip Pickering is the third Republican with ties to the building at 133 C Street SE to find his personal life making headlines in recent weeks, after Nevada U.S. Sen. John Ensign and South Carolina Gov. Mark Sanford.

Leisha Pickering is seeking unspecified damages in the alienation of affection lawsuit she filed this week against Elizabeth Creekmore Byrd of Jackson. The Pickerings filed for divorce in June 2008, but it is not complete.

Chip Pickering, 45, was elected to Congress in 1996, retired in January and is now a lobbyist in Washington for Cellular South, the company Creekmore Byrd's family owns. The lawsuit does not say when the affair started.

He said in a statement Thursday that his marriage is irreparably damaged.

"I still believe it is in the best interest of our five boys if our differences are resolved privately and before the appropriate court and not in the media," Pickering said.

He cast himself as a defender of decency, particularly on television and the Internet, and was among House members urging then-President George W. Bush to declare 2008 "the National Year of the Bible."

Another lawmaker who lived at the C Street house, Ensign, a member of the Christian ministry Promise Keepers, stepped down from the Senate Republican leadership in June after admitting he had an affair for much of last year with a woman on his campaign staff.

Just days after the story broke, South Carolina Republican Gov. Mark Sanford admitted an affair with a woman in Argentina. He apparently never lived in the house, but has said he turned to "C Street" for counsel and solace while having the affair.

The building, registered in tax records as a religious and commercial building, is affiliated with a Christian group that sponsors the annual National Prayer Breakfast attended by the president, members of Congress and other dignitaries. Both Democratic and Republican members of Congress live there.

Leisha Pickering's lawsuit also says that when Republican Trent Lott resigned from the U.S. Senate in December 2007, Mississippi Gov. Haley Barbour offered the seat to Chip Pickering, who declined. Barbour spokesman Laura Hipp said Thursday that the governor only offered the Senate seat to U.S. Rep. Roger Wicker, who accepted it.

The lawsuit contends that Creekmore Byrd gave Pickering an ultimatum, saying their relationship could not continue if he became a senator because he would have to stay married.

"Ultimately, Creekmore Byrd gave Pickering the option to remain a public servant or become a private citizen and continue relations with her," the lawsuit says.

The voice mail box at Creekmore Byrd's home was full Thursday and messages left for her divorce attorney were not immediately returned.

The 45-year-old is a member of Mississippi's wealthy Creekmore family, founders of the Cellular South phone company.

She and several relatives and Cellular South executives donated to Pickering while he was in Congress, and he had kind words for the company at a 2007 subcommittee hearing where invited speakers included Cellular South president Victor Meena.

He announced in August 2007 that he wouldn't seek another term. After leaving office in January, he joined the lobbying firm Capitol Resources LLC, in which one of Barbour's nephews is a partner. The firm, which counts Cellular South among its clients, lists Pickering as a member of its Washington and Mississippi teams.

In the House, Pickering specialized in telecommunications issues, including one dear to Cellular South: making sure Congress took into account the interests of cellular companies serving rural areas.

Creekmore Byrd and her husband, Dr. Douglas Byrd, were married in 1990 but stopped living together in June 2006. They were granted a divorce in 2007 on the grounds of irreconcilable differences.

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Associated Press writer Sharon Theimer in Washington contributed to this report.