Category Archives: Courts and law

Mamas, Don’t Let Your Daughters Grow up To Be Co-Eds

Phi Kappa Psi fraternity house at UVa.

Phi Kappa Psi fraternity house at UVa.

When I visited Virginia Tech a few weeks ago, the lead story in the campus newspaper was a take-out on the supposed “campus rape culture.” The number is widely touted that 20% of women are the victims of sexual assault while at campus. My instinct is to dismiss that figure as a figment of the feminist fringe, in which transgressions of any kind, from unwanted touching to real rape, are conflated as “sexual violence.” Many incidents are fueled by the combustible combination of rampant drunkenness and the casual sex of the hook-up culture, in which all normal standards of behavior are obliterated.

That said, rape that everyone recognizes as rape does occur. One such incident, which allegedly occurred at the University of Virginia, is profiled in Rolling Stone. The story of a first year student gang raped in the Phi Kappa Psi fraternity house, if accurate, is absolutely horrifying. What allegedly followed (or didn’t follow) is a travesty. Writes author Sabrina Rubin Erdely:

At UVA, rapes are kept quiet, both by students – who brush off sexual assaults as regrettable but inevitable casualties of their cherished party culture – and by an administration that critics say is less concerned with protecting students than it is with protecting its own reputation from scandal. Some UVA women, so sickened by the university’s culture of hidden sexual violence, have taken to calling it “UVrApe.”

Maybe that’s a fair take on what’s happening at UVa and other colleges, maybe it’s not. There are a lot of conservatives like me whom, I suspect, get turned off by the blather associating campus sexual violence with “patriarchal attitudes” and other such nonsense, as if society ever condoned rape as a “boys will be boys” thing to be swept under the rug. It was social conservatives, after all, who warned that the mixing of genders in college dormitories, the relaxation of visitation rules and the collapse of traditional moral values would lead to precisely the phenomenon we’re discussing today. Such fears were dismissed at the time, of course, as the hilariously antiquated thinking of prissy, tea-sipping old bitties.

But here we are. Feminists have discovered a “culture of rape” in what are arguably the most thoroughly enlightened and liberal institutions in the entire country, our colleges and universities. While I don’t think the Rolling Stone article has captured the entire truth of what’s happening on college campuses, I think it has captured part of the truth. And even that partial truth is ugly enough to take very seriously.

I would ask Virginia newspapers, why did Rolling Stone break this story, not you? If there is a campus rape epidemic on college campuses, are you going to continue to ignore it, highlighting only the cable news spectacles, like that of missing UVa student Hannah Graham, that are unrepresentative of the college experience? Conversely, if there’s not a campus rape epidemic, are you going to ignore that story, too? If the whole problem is wildly exaggerated — analogous, say, to the satanism scare of a couple decades ago — worried parents of college co-eds would like to know.

My suspicion is that there is a widespread problem but that it’s not as white-and-black as portrayed. College kids are… how shall I put this politely…. incredibly horny. The old social mores that held horniness in check have been obliterated. Concentrate thousands of males and females of the same age in a college campus, tear down the moral inhibitions against promiscuous sexuality, and dissolve inhibitions and judgment in a haze of alcohol, and you’re going to have a lot of sexual encounters, some percentage of which, in retrospect, are worthy of criminal punishment and some percentage of which participants simply regret. There is a cultural problem here. It’s not one of oppressive “patriarchy.” But it’s very real.

(Hat tip: The Nutshell by Frank Muraca. Check out Frank’s newsletter — it’s a short but punchy round-up of Virginia news, well worth reading.)

Fracking Our Pristine Mountain Forests

GW forestBy Peter Galuszka

Is nothing sacred? Of all groups, the U.S. Forest Service should protect the lands it controls, but today it introduced a plan that would allow limited hydraulic fracturing for natural gas in the 1.1 million-acre George Washington National Forest which straddles Virginia and West Virginia.

Virginia Gov. Terry McAuliffe had opposed lifting the ban, although he supports other proposed gas projects in the state, such as the 550-mile Atlantic Coast Pipeline that would stretch from the fracked gaslands of Northern West Virginia over the mountains and southeastward to Southside and Hampton Roads and North Carolina.

Forest lands help supply drinking water to 4 million people including those in Richmond and Washington. Some of the forest land has so-called “Karst” topography made up of rock formation that can be dissolved. In those conditions, any leakage of methane, or the toxic, powerful chemicals used in fracking would be more, rather than less, likely to poison drinking water.

The only good news out of the new USFS plan is that before some 995,000 acres could be available for drilling and that amount will now be limited to 177,000 acres.

But what can’t they let it all be? If you head west where the heart of the Marcellus Shale formation has become one of the mega-meccas of fracked gas, you hear of impacts of all types from drilling. These have included fire, explosions, diesel generators roaring 24/7, drinking water effects, bright floodlights and so on. In fact, I am embarking on a drip in about an hour that will end up in frack-land and will report when I get back.

To be sure, natural gas drilling has been going on for decades in the Appalachian Plateau of the western slopes of the Appalachians. Few pipelines crossed eastward over mountains and it was rare to find many drilling rigs in those areas.

But the fracking craze continues unabated and is now a $10 billion industry in the Marcellus Shale formation. One potential new target could be a different formation that starts from Fredericksburg and slips under the Potomac northeast into Maryland. A Texas firm with a letter drop address has been talking about leasing rights for fracking. One assumes that if the leases are in place, they’ll be quickly flipped to an actual drilling company, but you won’t know who. Virginia is only in the very early stages of setting up state rules for fracking.

Environmentalists say natural gas can be an even worse carbon polluter than coal should methane be released. Some others believe that the biggest damage comes not from the actual fracking process with millions of gallons of water and chemicals but from faulty wells.

One can make an argument that gas is good because it has completely reorganized the global pecking order in terms of energy. It means the U.S. need not be beholden to machinations of the Middle East, Central Asia and the likes of Vladimir Putin.

What bothers me is the rush to frack. I remember back in the 1960s in West Virginia when mile after mile of mountain side had been ripped apart by surface miners. It was a cheap way to get at coal. Mystery companies were supposed to reclaim the mine site but rarely did because they’d bankrupt one alphabet soup firm merely to create a new one.

The fracking craze, if not properly regulated, could yield even worse environmental disasters.

Former Massey Coal Chief Indicted

DonBlankenshipBy Peter Galuszka

The indictment today in Charleston, W.Va. of coal baron Donald L. Blankenship, the former head of the notorious Massey Energy Company, for violating federal mine safety and securities laws, has been long awaited, especially by the families of the 29 miners who died on April 5, 2010 in a huge explosion at Massey’s Upper Big Branch mine in Montcoal, W.Va.

It was the worst coal mine disaster in this country in 40 years. It topped off a wild run by Blankenship, who thought he had political potential and spoke for the Appalachian coalfields while dodging safety violations and blowing away mountains in horrific surface mining practices.

He was a poster man for the view, popular among this country’s business elite, that cost cutting and productivity are sacrosanct, human lives are cheap and environmental concerns such as climate change are mere diversions from the country’s true goals. At one point he literally wrapped himself up in the American flag to push his ideas.

A federal grand jury today turned those arguments on their heads. The four charges accuse Blankenship of conspiracy in blunting the numerous federal safety violations that lead to the catastrophic disaster at the Upper Big Branch mine.

For several years leading up to that fateful day, Blankenship allegedly connived to ignore concerns that the mine had broken equipment and excessively high levels of highly inflammable coal dust. He also is accused of keeping federal mine inspectors from doing their jobs.

The grand jury also claims that Blankenship violated federal securities laws by giving investors misleading information about Massey stock.

Blankenship was a huge celebrity in the Appalachian coalfields. Tying himself to a reactionary ideal of doing what he thought was best for America, he spent a million dollars at what was an anti-Labor Day celebration in West Virginia in 2009. He wore a costume formed from an American flag and hired testosterone-infused country music stars Hank Williams Jr. and Ted Nugent to entertain his crowd.

The irony was that it was a holiday to celebrate labor unions while Blankenship and his firm were notorious for union-busting. He also had a habit of taking the chief justice of the West Virginia supreme court on vacation on the French Riviera.

Another irony is that Blankenship, like much of the U.S. coal industry, promotes the propaganda that there is a “War on Coal” and that coal is essential to “keeping our lights on.” Never mind that the free market and the flow of natural gas from hydraulic fracturing drilling from the very same area, not the U.S. Environmental Protection Agency, are what is really hurting the Appalachian steam coal market.

The coal mined at Upper Big Branch, however, had nothing to do with power generation. It was metallurgical coal that was exported to make steel in markets such as China. At the time of Upper Big Branch, China’s steel market was hot and met coal prices were going through the roof.

The indictment reads that the group of mines associated with Upper Big Branch “generated revenues of approximately $331 million, which represented 14 percent of Massey’s approximately $2.3 billion in in revenue.” Obviously, it was in Blankenship’s interest to keep the steel-making coal flowing.

In that process, according to the indictments, Blankenship oversaw efforts to cut corners, dodge safety issues and keep miners on edge. They are rich in detail about poor ventilation; flawed water sprays to keep explosive coal dust down and warning when federal coal inspectors were on the prowl.

After he was forced to resign from Massey Energy with an over-sized golden parachute, Blankenship kept quiet for a couple for of years. Recently he came back on the scene with a self-made documentary just on the eve of the fourth anniversary of the Upper Big Branch disaster. The movie was so tasteless that even Joe Manchin, a U.S. Senator from West Virginia who was quoted in the film, disassociated himself from it. Families of the dead mines were appalled.

The long-in-coming indictments illustrate the problems of coal as an energy and steel source and just how its issues have been ignored in the Appalachians for about 150 years. In the past, huge mine disasters, such as the 1968 blast at Farmington W.Va. that killed 78, sparked real safety reform.

Not so after Upper Big Branch. Pro-coal Republicans in Congress have blocked bills to toughen rules. This is a reason why the federal indictments are so important. They show that leading a culture of safety laxity will no longer be tolerated.

It may be curious that Blankenship’s indictments come just after President Barack Obama has just agreed to a turning point treaty with heavy polluter China to cut carbon emissions. But they should give some closure to long-festering problems in a part of the United States where industrial death and destruction are considered business as usual.

In Energy Studies, No Renewables, Please

Karmis of VT's Center for Coal Research

Karmis of VT’s Center for Coal Research

By Peter Galuszka

For years, Virginia Tech has operated the Center for Coal Research which is dedicated to studying bituminous product, enhance its marketability and make mining it safer and less environmentally destructive.

The center receives funding and has sponsors and an advisory board made up of big utilities like Dominion, coal-hauling railroads like Norfolk Southern, a few state officials and coal company executives from Alpha Natural Resources, Arch Coal and Patriot Coal. No environmental advocates are advisers nor are proponents of renewable energy.

So, it was with considerable interest that I was introduced to a new “watchdog” group named the Checks and Balances Project, based in Northern Virginia and  funded by advocating clean energy and sustainability such as the New Venture fund and Renew American Prosperity Inc.

In several intriguing blog posts, Scott Peterson, a former media spokesman for the New York Stock Exchange and now executive director of Checks and Balances, asks why Michael Karmis, an internationally-known VT coal expert, was asked to write the cost-benefit analysis for the State Energy Plan released last month that will guide the General Assembly in passing laws relating to energy.

Peterson notes that Karmis’s report was a foundation document used by the State Corporation Commission staff when it gave a big thumbs down to the U.S. EPA’s proposed rules to cut carbon dioxide. The SCC claimed that the rules would shutter much coal-fired generation (much of which was going to be shut down anyway) and that renewables like solar and wind are too expensive, unreliable and scarce to replace the lost generation capacity.

I blogged about this repeatedly in recent weeks and I asked why Virginia has such a puny share of renewable energy compared to its neighboring states. I got responses from the SCC and also from Dominion as well as the Virginia Chapter of the Sierra Club and posted them.

Peterson’s points are spot on. Why would the state and the SCC go to such an overwhelmingly pro-coal group for what seems like a self-serving and self-dealing cost-benefit analysis? Do Virginians not deserve input from other players pushing forms of energy? Why did they not consult economic forecasting groups specializing in energy but chose instead Chmura Economics & Analytics of Richmond, which has no special energy expertise and has been criticized (by me) for tending to say what state officials want.

It is really a shame that the administration of Gov. Terry McAuliffe is following the same stacked-decks that former Gov. Robert F. McDonnell used to use. During his time in office, I outlined several instances where McDonnell chose “advisors” mostly from the coal and nuclear and natural gas industries to “study” energy needs or whether uranium mining near Chatham would be safe.

Also take a look at who the sponsors of the Virginia Tech coal center are:

  • Alpha Natural Resources of Bristol bought the extremely troubled and controversial Massey Energy whose renegade CEO, Don Blankenship, was so loose with safety and so strong on production demands that 29 miners lost their lives in a massive blast at the Upper Big Branch mine in West Virginia on April 5, 2010, according to three probes of the incident. I wrote a book about it.
  • Arch Coal is one of the most controversial users of ecologically devastating mountaintop removal surface mining in southwest Virginia, Kentucky and West Virginia,.
  • Evan Energy Investments is a Richmond-based firm started by E. Morgan Massey, whose family started A.T. Massey coal which later became Massey Energy. E. Morgan Massey had no corporate duties at Massey Energy during the 2010 blast but during the 1980s, he beat the United Mine Workers by instituting his “Massey Doctrine” of tough negotiating.
  • Patriot Coal is a spin-off of Peabody Coal, the largest coal firm in the U.S. Peabody had assets in the Central Appalachians but found that its western U.S., Illinois Basin and foreign operations were more profitable so it created Patriot. The spin off has been bankrupt at least once and has been criticized for trying to cut benefits for retired miners who had worked for Peabody.

To be sure, several state and federal organizations are also sponsors and I’m told that the center does do worthwhile working on setting up computer-based networks of sensors that would automatically shut down a deep mine’s operations if it found bad levels of explosive coal dust or methane. It also has done work to find carbon capture technologies that could allow coal to be burned cleanly.

The larger point is that the state is structured in ways that do not provide a place at the table for people not associated with big, traditional, base-loaded energy such as coal and nuclear power stations. Many accounts show that solar and wind are becoming much more technically and cost effective. Although the U.S. Department of Energy does not expect wind or solar to be more than about 20 percent of the total energy mix any time soon, its growth is picking up speed.

If more houses and businesses adopt solar panels as they get cheaper and better, they will reduce their need for Big Energy. As that happens, the large utilities, coal firms and railroads may get stuck with trillions of dollars’ worth of “stranded” and unused assets. Guess will end up paying for a lot of them? The ratepayers, of course, with the SCC’s blessing.

Was Bob McDonnell Convicted with Tainted Testimony?

Baron von Munchausen, famous spinner of tall tales

Baron von Munchausen, famous spinner of tall tales

Jonnie Williams’ trial testimony about a critical meeting with the former governor was contradictory, implausible and sometimes incoherent. But the jury bought it anyway.

Peter G.’s skeptical response to the op-ed I co-authored with Paul Goldman and Mark Rozell is exactly what I would have expected, given the fact that we had to boil a complex argument with abundant support documentation down to 750 words. Accordingly, what follows is an expanded version of that column. However, I take the argument further than Goldman and Rozell may be comfortable taking it, so I assume sole responsibility for this piece. — JAB

In closing statements of former Governor Bob McDonnell’s August trial, lead prosecutor Michael Dry made a remarkable statement. McDonnell had flat-out denied key testimony of star witness Jonnie R. Williams, a suspected con man under federal investigation who had agreed to testify in exchange for a generous immunity agreement. Dry acknowledged that jurors might suspect that Williams had lied. But then he argued, “Who cares?” The jury could “discount everything, every single word uttered by Mr. Williams,” he said, and it wouldn’t matter. There still remained a mountain of evidence to prove the government’s case that McDonnell and his wife had used their status to obtain $138,804 in gifts and loans from Williams.

“Who cares” if Mr. Williams lied? The jurors apparently did not; they found the governor guilty on all counts, his wife on nine. But Virginians should care. When Mr. and Mrs. McDonnell are sentenced for their convictions early next year, they may well be sentenced to jail time, and the amount of time will be determined in part by the number of counts for which they were convicted. If some of those convictions were obtained from tainted testimony, they will be punished excessively and unjustly.

Virginians also should care about the lengths to which a Democratic Attorney General’s office was willing to go to win a conviction against a popular Republican governor. Prosecutors put forth as a witness a man whose narrative evolved over some ten meetings with the FBI and federal prosecutors, whose story about a key encounter with McDonnell changed within the trial itself. Indeed, law enforcement officials had every reason to question his story themselves. If they won their convictions through tainted testimony, is that really the way Virginians want the rule of law to work?

Government’s key witness

Serial entrepreneur and Star Scientific Inc. founder Jonnie Williams had been fined in the 1980s by the Securities and Exchange Commission, and he remained on the federal government’s scam radar. At Star Scientific, he peddled the promise of developing a “safer cigarette.” When that futile quest collapsed, he claimed to have discovered a miracle compound, anatabine – as big as penicillin — that potentially could fight Alzheimer’s and other diseases linked to inflammation. But he faced a steep climb to gain acceptance. Virginia’s secretary of health and human services, among others, dismissed the product as “worthless.”

Unbeknownst to the public, the First Couple was struggling financially with crushing credit card debt and underwater real estate investments in Virginia Beach. Prosecutors argued that the McDonnells engaged in a conspiracy to trade the prestige and support of the Governor’s office for Williams’ gifts and loans. The McDonnells hosted a luncheon praising Anatabloc in August of 2011 at the Governor’s Mansion. The First Lady spoke at Star investor conferences across the country.  The Governor popped Anatabloc at official meetings and helped set up meetings with state government officials.

For all the documentation the feds had gathered, however, they lacked “smoking gun” proof of a quid pro quo.  McDonnell argued that he did no more for Star Scientific than he would for any promising Virginia company. Prosecutors needed Williams to provide evidence of a tacit conspiracy to trade favors for gifts.

The first time investigators interviewed him, Williams described the McDonnells as friends. He denied trying to buy influence with his loans. He praised the Governor’s integrity. But the government ratcheted up the pressure, probing into potential insider trading transaction involving Star Scientific stock. The second time he met with investigators, they granted him “use” immunity, which prevented his testimony from being used against him. Williams then said there was a “wink and a nod” agreement to exchange gifts and favors. In a meeting shortly before the trial, the government offered “transactional” immunity that protected him from other offenses, including the insider-trading probe. His story changed yet again. This time, he said, he was never friends with Maureen and Bob McDonnell. Their dealings were business transactions, and they knew they were exchanging gifts for favors.

Accordingly, prosecutors made the following keystone charge, upon which much of the rest of the case would hinge, in its indictment:

Before agreeing to provide the requested financial assistance to the defendants, JW [Jonnie Williams] spoke directly with ROBERT MCDONNELL about the $50,000 loan. In that conversation, ROBERT MCDONNELL explained the defendant’s financial difficulties. ROBERT MCDONNELL informed JW that the rental income from the defendants’ rental property in Virginia Beach was not covering the bills for those properties. JW agreed to provide the $50,000 loan with a two-year term at 5% interest. JW also informed ROBERT MCDONNELL that loan paperwork was not necessary.

Williams later admitted in court that the deal freed him “from worrying about going to jail.” Legal experts were hard pressed to remember other instances of prosecutors granting such broad immunities in a corruption case.

Shifting story

May 2, 2011, was a key date in the prosecution’s conspiracy timeline. The prosecution alleged and the defense did not dispute that Williams and Mrs. McDonnell met at the Governor’s Mansion. Mrs. McDonnell revealed the family’s credit-card and rental-property issues to Williams, and Williams agreed to give her a $50,000 personal loan and to cover $15,000 in catering costs for daughter Cailin’s upcoming nuptials.

The other key date was May 23, 2011, the day that Williams delivered the two checks. It happened to be his wedding anniversary, and he and his wife Celeste were planning to have lunch at the Jefferson Hotel. Williams dropped by the Governor’s Mansion on the way to deliver one check for the catering company and another made out to Mrs. McDonnell. Williams and his wife stayed about an hour and fifteen minutes, he testified at one point. “We went upstairs and had a salad.”

Why, the defense asked, did he make out the $50,000 check to Maureen McDonnell? Because, he testified, that’s to whom she said to make it out to.

Federal anti-corruption law applies to elected or appointed public officials. As First Lady, Mrs. McDonnell was neither elected nor appointed. She was a private citizen. While it was wildly inappropriate in the eyes of the public for her to offer Williams her services in exchange for the $65,000, it was not illegal. To demonstrate a conspiracy that involved McDonnell, prosecutors had to show that the Governor knew about the arrangement at the time. Continue reading

FLOP! Goes Their Argument

maureen_and_bob(1)By Peter Galuszka

How confusing can we make it?

Together, former Gov. Robert F. McDonnell and his wife Maureen had numerous conversations with businessman Jonnie R. Williams from 2011 until 2013 about more than $177,000 in gifts and loans. They were convicted of corruption in federal court on Sept. 4.

In an opinion piece that is breathing taking in its misrepresentation and confusion, Jim Bacon, Paul Goldman and Mark J. Rozell wrote in the Roanoke Times Sunday and on this blog that the government’s case against the McDonnells is substantially flawed because Bob McDonnell did not discuss terms on one of Williams’ loan  payments to them.

The opinion piece also says that U.S. Atty. Gen. Eric Holder must come clean about supposedly fiddling with evidence before the McDonnells are sentenced next year. The opinion piece fails to present any hard evidence that Holder did just this.

Their argument falls apart because Bob McDonnell did most definitely discuss loans and terms with Williams on several occasions.

Here’s what Bacon, Goldman and Rozell wrote:

“Prosecutors conceded Maureen McDonnell had personally asked Williams for the loan on May 2, 2011. She promised to reciprocate by helping Star. Williams testified understanding she spoke solely for herself, not her husband. Virginia’s first lady is not a public official under federal anti-corruption laws. While disgraceful, this two-way deal did not break the law.

“The Star pitchman personally delivered a $50,000 check payable to her on May 23 when they met at the Executive Mansion. Gov. McDonnell swore he didn’t learn about the check until two weeks afterwards. The prosecution self-evidentially believed it crucial to show his knowledge prior to her accepting the money.

“During testimony, Williams said he couldn’t remember when he spoke to the governor, or even whether he had spoken by telephone or in person. But he remained adamant, saying, “I am not writing his wife any checks without him knowing about it.”

But wait, here’s Trip Gabriel in the New York Times reporting about ANOTHER loan nearly one year later.

“Mr. Dry, who has led the federal investigation for 16 months, began the timeline with Mr. McDonnell’s own notes on a legal pad from Feb. 3, 2012, when he was negotiating a loan from Mr. Williams of Star Scientific.

“That initial deal was for 50,000 shares of Star Scientific stock, at $3.15 a share, worth more than $150,000, to be paid back with the repurchase of 50,000 shares at $1.90 a share. In other words, Mr. McDonnell would have had to repay a $150,000 loan with $90,000, after he was out of office, according to his own notes.

“Five days later, an aide to Mr. McDonnell sent an email saying Ms. McDonnell and the governor “were going over the list last night for the health care industry event.” The email indicated that both wanted Mr. Williams and his company at the event, where they could mix with university researchers in Virginia.

“On Feb. 9, Ms. McDonnell emailed her husband about potential clinical trials at the University of Virginia and Virginia Commonwealth University. “Here’s the info from Jonnie. He has calls into VCU, UVA and no one will return his calls,” she wrote.

“On Feb. 10, Ms. McDonnell emailed Jasen Eige, the governor’s senior policy adviser and lawyer, saying, “Gov wants to know why nothing has developed with studies.” Mr. McDonnell said he wanted no such thing.

“At 12:02 a.m., Feb. 17, Mr. McDonnell emailed Mr. Eige: “please see me about Anatabloc issues at VCU and UVA.” Four minutes later, the lawyer responded, “will do,” and added, “We need to be careful with this issue.”

“On Feb. 18, Mr. McDonnell personally emailed Mr. Williams to resume loan negotiations.

“Then on Feb. 29, Mr. McDonnell and Mr. Williams held a private meeting ostensibly on the health care leaders’ meeting that night. But the subject was the loan, which was growing more favorable. Mr. Williams offered 52,000 shares of Star Scientific, valued that day at $3.75 — a $187,000 offer, to be repaid with 50,000 shares repurchased at $2.20 a share, or $110,000.

“That night, less than five hours later, Mr. Williams was back at the Governor’s Mansion for the health care leaders’ meeting.

“Mr. McDonnell said the terms of the loan were of no consequence, since ultimately the stock loan fell through and he took $50,000 in cash for his real estate company, known as MoBo.

“Mr. Dry, if you are suggesting I got a $50,000 loan for MoBo in order to get Mr. Williams’ calls returned, you’re completely off base,” a prickly Mr. McDonnell snapped at one point.”

Hmm. Let’s see. We have one loan in 2011 apparently without Bob and another in 2012 with Bob (not to mention the golf bag, Ferrari, vacations, golf jackets, and so forth.)

The three authors have made a serious error by cherry picking one of several loans involving the McDonnells and Williams and making, forgive the pun, a federal case out of it. Flop goes their argument.

Did McDonnell Prosecutors Knowingly Use Tainted Testimony?

mcdonnellPublished this morning in the Roanoke Times:

By Paul Goldman, James Bacon and Mark J. Rozell

Did Democratic U.S. Attorney General Eric Holder sanction using tainted trial testimony against Republican Gov. Bob McDonnell? In closing argument, the prosecution said jurors could “discount everything, every single word uttered by” Star Scientific founder Jonnie R. Williams and still find the McDonnells guilty of public corruption. Yet Williams had been the government’s chief witness and sole accuser. He spent nearly a week on the witness stand. Determining “who is most believable about the interactions between the governor and Williams” had been called the key to the case.

The Virginia native had appeared on Uncle Sam’s scam radar since the 1980s, after the Securities and Exchange Commission investigated false claims by an earlier Williams company. When Williams met Gov. McDonnell, he hawked “Anatabloc,” a nutritional supplement based on a curative “discovery” touted as more important than penicillin. The indictment charged Williams had given $138,804 in gifts and loans in exchange for the governor’s agreement to help Star promote the product.

Williams initially defended the First Couple but testified against them pursuant to a rare immunity deal shielding him from prosecution for crimes not related to the McDonnell case. Prosecutors promised jurors he would be completely truthful.

Indictment paragraph 28 remained key to the government’s corruption conspiracy timeline:

“Before agreeing to provide the requested financial assistance to the defendants, JW [Jonnie Williams] spoke directly with ROBERT MCDONNELL about the $50,000 loan . . . ROBERT MCDONNELL informed JW that the rental income from the defendants’ rental property in Virginia Beach was not covering the bills for those properties. JW agreed to provide the $50,000 loan . . . .”

Prosecutors conceded Maureen McDonnell had personally asked Williams for the loan on May 2, 2011. She promised to reciprocate by helping Star. Williams testified understanding she spoke solely for herself, not her husband. Virginia’s first lady is not a public official under federal anti-corruption laws. While disgraceful, this two-way deal did not break the law.

The Star pitchman personally delivered a $50,000 check payable to her on May 23 when they met at the Executive Mansion. Gov. McDonnell swore he didn’t learn about the check until two weeks afterwards. The prosecution self-evidentially believed it crucial to show his knowledge prior to her accepting the money.

During testimony, Williams said he couldn’t remember when he spoke to the governor, or even whether he had spoken by telephone or in person. But he remained adamant, saying, “I am not writing his wife any checks without him knowing about it.”

The prosecution trumpeted this “evidence,” declaring, “What does this tell you about who the loan was really to?”

But his testimony crumbled. During cross-examination, defense counsel asked Williams:

Question: “Before those checks were cut, between the 2nd of May and the 23rd of May, you never talked to Bob McDonnell about those checks, did you?”

Answer: “No.”

He then insisted the conversation occurred while delivering the checks on May 23.

Prosecutors proffered no corroborating phone record or eyewitness account. Furthermore, while Williams claimed the governor said he needed the money to keep his Virginia Beach rental properties afloat, Maureen McDonnell put the $50,000 in her account and used most of the sum to purchase Star Scientific stock, not to cover beach property expenses.

In closing argument, the prosecution told jurors, “Who cares?” whether Williams might have lied since the government had “more evidence than necessary” to convict. Read more.

Goldman is a Richmond lawyer and Democratic Party activist. Bacon publishes the Bacons Rebellion blog covering public policy issues in Virginia. Rozell is Acting Dean of the School of Policy, Government, and International Affairs at George Mason University.

Sticking it to the Chinese

factory manBy Peter Galuszka

This  is a review of “Factory Man,” a book about the Virginia furniture business and dealing with the inequities of Chinese trade by Beth Macy (Little Brown, 451 pages). This was first published in the October 2014 Bulletin of the Overseas Press Club of America in New York of which I am a member.

The hills around Danville Va. are blessed with some of the finest hardwoods around such as oak, hickory and cherry trees. It is those trees, and the people who work with them, that have made for one of the more vicious global trade wars in recent history.

They also represent one of the few trade victories American industry has had, according to Beth Macy, a Roanoke Times reporter who has written a lively and deeply reported book about Vaughan Bassett, a local firm that is now the largest American furniture maker. Boss John D. Bassett (“JBIII”) refused to succumb to an onslaught of cheap Chinese labor and government subsidies that helped shutter 63,300 U.S. factories and five million jobs from 2001 to 2012. By standing up to Beijing, he saved his company and 700 jobs.

Macy’s first book is of value to anyone who covers global trade issues. She punctures the conceit, held by many journalists in the New York-Washington axis, that globalization is a great and inevitable thing. I heard this constantly at BusinessWeek where I worked as an editor and bureau chief in the 1980s and 1990s.

What’s lost in the laud of so-called “free” trade is what happens to the people who lose. Their secure employment turned overnight into a new world of Medicaid, food stamps and family strife.

Big Journalism doesn’t seem to care much. “Even globalization guru Tom Freidman, writing in “The World Is Flat,” briefly acknowledges the agony caused by offshoring.” But she notes that it’s easy for him to say since Friedman, “lives in an 11,400 square foot house with his heiress wife” in Bethesda, Md., a “cushy” Washington suburb five hours by car from the turmoil farther south.

For years, Bassett and its sister factories were part of a network of Southern-style company towns with their own issues, such as paying African-American workers half of what whites got. By the 1970s, U.S. furniture quality and productivity were slipping. A Taiwanese chemist discovered how to make rubber trees useful for furniture after they stopped producing latex, giving rise to an expanded Asian export furniture business.

Chinese industrialists took over. They visited U.S. factories, where, according to Macy, naïve executives handed over their production secrets. In short order, cheap Chinese knockoffs were stealing market share from the Americans. A Chinese executive named He Yun Feng bluntly suggested to JBIII that he shut his plants and hand his business over. Proud JBIII didn’t turn tail. Instead, he shored up his production and cut costs while preserving as many jobs as he could. He also bucked his reluctant industry and challenged the Chinese for dumping and manipulating their currency to give them unfair trade advantages.

“The last thing they wanted to hear was that China may have been breaking the law.” Macy quotes JBIII as saying. That’s the nut of Macy’s excellent book. A tighter edit, especially in the early history of the Basset family, might have helped, but her story is powerful and well told.

OPC member Galuszka lives in the Richmond, Va. area and is author of “Thunder on the Mountain; Death at Massey and the Dirty Secrets Behind Big Coal” St. Martin’s Press, 2012.

Why Virginia Has No Renewable Energy

offshore wind By Peter Galuszka

For all the hew and cry over renewable energy sources and the “War on Coal,” it is extremely interesting to see just how much progress Virginia has made with renewable energy. The answer: hardly any to none.

A moment of clarity came when I was perusing blog postings by IvyMain, a D.C. area lawyer and Virginia Sierra Club activist who is quite often ahead of the curve on energy issues.

She posted a table of how Virginia compares with neighboring states in development of solar and wind power.

Leading her list is West Virginia with 583 megawatts of wind power. Next is North Carolina with 335 megawatts of solar power. Maryland is almost equally split between solar and wind with 262 megawatts.

And Virginia? A whopping 18 megawatts of solar and zip-o wind.

The State Corporation Commission has written against proposal EPA regs limiting carbon emissions saying it would shut down too many coal-fired plants. Solar and wind could make up some of it, but the SCC claims that “there is still zero probability that wind and solar resources can be developed in the time and on a scale necessary to accommodate the zero-carbon generations levels needed” to help meet the EPA’s carbon emission goals by 2030. Even more curious, the SCC used EPA figures that Virginia has 351 megawatts of renewable power. Hmmm.

One can almost see a clever and duplicitous scheme here. One reason why Virginia’s neighbors have remarkably more renewable power than Virginia is that they have mandatory renewable portfolio standards. In Maryland, 20 percent of all electricity generated must come from renewable sources by 2020. In North Carolina, it is 12.5 percent by 2021 and in coal-rich West Virginia, it is 25% renewable by 2025.

Virginia’s “voluntary” goal is 12 percent by 2022. Why so little and voluntary? Easy. Dominion Virginia Power has a legal deal going where it has a “monopoly” on electricity distribution and according to IvyMain cracks down wherever possible on independent solar generation. She notes that Dominion squelched a solar project at Washington & Lee University a few years ago and has attacked similar plans. After preventing renewable power from developing, Dominion and its allies can then say we must keep big, traditional  facilities (nuclear, natural gas and coal-fired) going because there’s so little available on the renewable front.

Dominion, of course, is a huge political contributor. According to the Virginia Public Access Project, Dominion and Dominion Resources combined are the No. 1 corporate donors in this state. They gave about $1,042,580 this year. The No. 3 corporate donor is Alpha Natural Resources, a major coal company based in Bristol that gave $218,874.

Conservative commentators regularly pin the EPA’s flexible but stricter rules on a so-called “War on Coal” led by President Barack Obama. Yet, Virginia is a small coal producer compared to West Virginia, which is presumably ground zero in the fight against the Black Diamonds. So, how come West Virginia, the No. 2 coal state, has mandatory renewable standards and leads the pack in renewable energy?

The answer is that West Virginia’ leadership knows that its coal days are numbered and this started long before Obama came to power. The Mountain state has plenty of, well, mountains that can be great foundations for wind. So, too, does Virginia – the exact same mountain ranges in fact. But that doesn’t seem to matter. One noted right-winger blogged about the supposed “War on Coal” and then tried to preempt responses that broadened the reasons for coal’s demise:

“No lectures about the coal industry, please. I understand that the current woes of the coal industry stem in large measure from coal’s loss of competitiveness to natural gas as a fuel and to cyclical movements in the market for metallurgical coal (used by the steel industry). However, the Appalachian coal industry still produces a lot of steam coal for power plants, and the EPA rules would destroy much of that market. Clearly, the EPA rules, which are not yet in effect, have not yet destroyed a single coal-mining job. Come back to me in 2020 and it will be a very different story.”

Today’s New York Times has a story about political races in West Virginia where coal and Obama are naturally issues. The story contains this revealing passage:

“The coal industry’s long decline is economically complex. When Alpha Natural Resources, one of West Virginia’s largest coal operators, warned 1,100 employees of potential layoffs in July, it blamed a worldwide glut of coal, competition from cheaper natural gas, and lower-cost coal from western basis – as well as Environmental Protection Agency regulations.

“But in the charged political arena, complexities fade and both sides identify a sole culprit for the industry’s struggles: the administration’s anti-coal regulations.”

So there you have it. In Virginia, rules are set up to prevent renewables from being established while political types and their conservative blogger handmaidens beat the drum against the EPA and Obama.

Brat’s Strange Immigrant-Bashing

BratBy Peter Galuszka

It must have been an interesting scene. Congressional candidate David Brat had been invited to a meeting of the Virginia Hispanic Chamber of Commerce along with his Democratic rival Jack Trammell to outline his views on immigration and undocumented aliens.

Brat, an obscure economics professor who nailed powerhouse Eric Cantor in a Republican primary for the 7th Congressional District in June, danced around the topic, according to a news account.

It took several attempts to get him off his spiel on just how wonderful free market capitalism is to actually address the issue at hand. Before him were a couple dozen business executives, many of them Hispanic.

They, naturally, were interested in Brat’s views because of his over-the-top Latino-baiting during the primary campaign. One of Brat’s ads trumpeted: “There are 20 million Americans who can’t find a full time job. But Eric Cantor wants to give corporations another 20 million foreign workers to hire instead.”

Finally, Brat claimed, “I have never said I’m against legal immigration.” He later said, “nations that function under the rule of law do well.” Brat also said he wants to “secure” the U.S. border with Mexico. Trammell said he supports the DREAM Act that could provide a path to U.S. citizenship for some of the 11 million undocumented aliens in this country.

Brat’s immigrant-baiting and his “rule of law” smacks of a lot of ugliness in American history. “Know–Nothings” of white Anglo Saxons beat and harassed Catholic immigrants, primarily from Ireland. Chinese were harassed on the West Coast and Japanese-Americans were locked up in concentration camps during World War II. Jewish newcomers were met with restrictive covenants and college quotas.

In Richmond during the 1920s, efforts by Catholic Italian-Americans to build a monument to Christopher Columbus were fought by the Ku Klux Klan, which insisted that any such statue not dirty-up Monument Avenue and its parade of Confederate generals. Columbus had to go elsewhere in the city.

There’s a new twist and judging from Brat’s behavior on Tuesday. He seems uneasy by getting so out front on immigrant-bashing. He’s not the only Republican to take such strident stands. Look at New Hampshire, where Scott P. Brown, a Republican, faces Jeanne Shaheen, a Democrat, in a closely-watched race for the U.S. Senate.

Groups backing Brown, such as John Bolton, the surly former U.S. Ambassador to the United Nations, have run anti-Shaheen ads showing throngs of people clambering over a border just before showing Islamic militants beheading James Foley, a journalist and New Hampshire native, according to the New York Times. The ad was pulled after the Foley family complained, the Times says.

A major coincidence is that the Times‘ description of New Hampshire almost matches that of Virginia’s 7th Congressional District. Neither seems a hot bed of immigrant strife and threats.

The Granite State has one of the smallest populations of illegal immigrants in the country, the Times says. Of the state’s 1.3 million residents, only 5 percent are foreign-born and 3 percent are Hispanic.

The Virginia district has a population of 757,917 of whom 12.7 percent are foreign born and 4.9 percent are Hispanic. Most of the residents, 74.3 percent are white.

The district runs from the largely white and well-off western Richmond suburbs in Henrico and Chesterfield Counties and scoots northwest across mostly rural farmland to east of Charlottesville and up to Madison. With only 7.6 percent of the people living below the poverty level, it isn’t exactly a barrio of Los Angeles.

It is hard to imagine hordes of brown-skinned people swarming from up Mexico or Central America displacing the managerial executives, small business people and farmers in the Seventh. People that Brat seems to be worried about are employed in other nearby areas, such as the poultry plants of the Shenandoah Valley. But those workers are there because of local labor shortages. One wonders where Brat gets his ideas that illegal immigrants are going to steal true-blue American jobs in his district.

Last June during the primary, there was plenty of news about thousands of young Hispanic children coming across the southern border from Central America. At the time, there were estimates that up to 90,000 such children might come illegally into the U.S. this year. Many are fleeing gang violence in their homelands.

This is apparently what Brat is running against – a bunch of poor, 12-year-old Nicaraguans out to steal jobs and provide cover for Islamic terrorists. Their plight is a serious issue, but it is a humanitarian one. Brat chose to make it an odd classroom lesson in economics. He says the U.S. should not put up “green lights” and “incentivizing children from other countries to come here illegally and at their own peril.”

The news from the border seems to have calmed down since June. Brat may have found that now it is likely he’s going to Washington, playing the Hispanic-baiting card may not work as well on the national scene as it apparently did in his mostly-white district. It could be why he was hemming and hawing so much before the Virginia Hispanic Chamber of Commerce.

Illegal immigrant Ayn Rand

Illegal immigrant Ayn Rand

Perhaps other Republican politicians are having the same epiphany. As the New York Times writes: “Republicans have long relied on illegal immigration to rally the conservative base, even if the threat seemed more theoretical than tangible in most of the country. But in several of this year’s midterm Senate campaigns — including Arkansas and Kansas, as well as New Hampshire — Republicans’ stance on immigration is posing difficult questions about what the party wants to be in the longer term.”

There’s another strange contradiction with Brat. He’s a former divinity student interested in probing how unfettered free market capitalism can magically make the right choices for the betterment of mankind.

He draws a lot of his thinking from Ayn Rand, the famous thinker, refugee from the Bolsheviks and backer of her own brand of anti-government capitalism.

It may interest Brat that by today’s standards, Rand would have been an illegal immigrant.