Halloween is just days away, but the scariest thing this week are not ghouls and zombies; it’s the corruption running amok in government.
Here are the most important corruption stories from this week that you might have missed.
President Trump broke from custom and personally interviewed several US attorney candidates
The potential prosecutors would have jurisdiction over New York City and Washington, D.C.
Law is like real estate: location matters. President Trump has personally interviewed potential US attorney nominees who would cover three jurisdictions: Manhattan, Brooklyn, and Washington, DC. The move concerns some ethics experts and elected officials because these are locations that could play an important role in investigations of purported collusion between the Trump campaign and Russia. As the federal government’s top prosecutor in an area, the US Attorney has substantial discretion in deciding which cases to pursue and how to pursue them. President Trump has reportedly not interviewed candidates outside these jurisdictions. While it’s not against the law for a president to interview these candidates, it is unusual – former Obama and Bush administration officials said neither of those former presidents did so.
The bottom line: President Trump may have painted himself into a corner here, since interviewing a handful of candidates will raise obvious questions: why them and not others? Maintaining distance between the presidency and the Department of Justice prevents the appearance of political interference.
Puerto Rico electricity contract goes to tiny company financed by a major Trump donor in Interior Sec. Ryan Zinke’s hometown
Whitefish Energy Holdings reported two employees working full-time when Hurricane Maria struck Puerto Rico.
Puerto Rico faces an enduring electricity crisis in the aftermath of Hurricane Maria – at the time of writing, just 20 percent of the island had power. To help address the disaster, the Puerto Rico Electric Power Authority signed a $300 million contract with a company from Interior Sec. Ryan Zinke’s hometown that had just two full-time staffers when the hurricane hit. And that’s not all. That company – Whitefish Energy Holdings – receives much of its funding from a firm founded by Joe Colonnetta, a significant Trump donor. As the Daily Beast reported, Colonnetta gave more than $25,000 to Trump’s campaign and an aligned PAC, and he and his wife contributed more than $64,000 to the Republican National Committee last year. Zinke and Colonnetta know each other, but the secretary’s office attributes that to the nature of the small town, where “everyone knows everyone”. Get this: under the terms of the contract, the government has no “right to audit or review the cost and profit elements” of labor related to the reconstruction.
The bottom line: In many disasters, utility authorities use “mutual aid” agreements to rebuild quickly, rarely contracting for-profit companies to do the work. Given the inside connections and the fact that there wasn’t a standard bidding process, this looks an awful lot like political back-scratching pending further investigation.
Ethanol flexes its political muscle
Midwestern senators pushed the EPA to protect ethanol after oil industry pressure threatened the biofuel.
Don’t you just love it when two energy lobbies butt heads? The federal government has long required refineries to add biofuels, like corn ethanol, to gasoline. As Axios reported, however, the oil industry had recently pushed EPA chief Scott Pruitt to change that requirement, and the ethanol lobby wasn’t happy. Senators from the corn-producing Midwest, like Iowa’s Chuck Grassley and Joni Ernst, resolved to gum up EPA nominations until they received word from Pruitt that ethanol would be protected – and they soon did. Pruitt reassured those Republicans of the biofuel’s continued importance in an Oct. 19 letter. Bonus: a moment of beautiful irony from the above-linked Axios piece:
“In a moment of weakness I’ll tell you what I’m really thinking,” Chet Thompson, president and CEO of the American Fuel and Petrochemical Manufacturers, which represents oil refineries, said on Friday. “It’s frankly been very embarrassing to watch the administration bend its knee to its will to king corn and these handful of senators.”
The bottom line: When an interest group controls your state or region, this is how it wins the day in Washington – officials threaten obstruction and take home concessions.
It will now be much harder to file class-action lawsuits against banks
Congress voted to eliminate a rule that would have blocked banks from forcing customers into private arbitration.
What happens when you and a number of other customers have a legal claim to make against a bank? Well, thanks to a Senate vote this week, you won’t be able to join a class-action lawsuit. The legislation in question, now headed to President Trump’s desk, repeals a Consumer Finance Protection Bureau rule that would have given consumers the right to take banks to court rather than engage in arbitration. Banks and companies often load their contracts – the ones with all the fine print that we just click through – with language that forces consumers into mediated negotiations when they have a dispute (and keeps the companies out of court). As the Los Angeles Times noted, Wells Fargo used arbitration requirements to prevent lawsuits from aggrieved customers while it created millions of unauthorized accounts. They’re not the only company unhappy with the idea of being taken to trial. When Equifax exposed millions of its customers’ personal information to a data breach, it first tried to force them to sign away their right to sue in exchange for identity theft protection. Those in favor of the repeal argue the rule would have led to a flood of class-action lawsuits and higher prices for consumers.
The bottom line: This is a win for Wall Street and a win for the entire financial industry, but it comes at the expense of consumers around the country. Oh, by the way, several banks themselves joined a class-action suit against Target a few years ago…after a data breach.
Thanks for reading our spooky tales of influence and graft! Feel free to send stories you’d like to see featured in next week’s edition to email@example.com.