Category Archives: Politics

Bob Takes a Hit

A rare smile from Maureen McDonnell at the federal courthouse in Richmond. Photo credit: Times-Dispatch

A rare smile from Maureen McDonnell at the federal courthouse in Richmond. Photo credit: Times-Dispatch

by James A. Bacon

Bob McDonnell took a big hit yesterday in the corruption trial against him and his wife Maureen. He has a lot more explaining to do about his knowledge of his wife’s ownership of Star Scientific stock.

Before yesterday, the testimony of prosecutor witnesses had focused overwhelmingly on the out-of-control behavior of Maureen McDonnell in soliciting gifts from Star Scientific CEO Jonnie Williams Sr. and using her influence as first lady to promote the interests of his company. The governor himself had remained in the background, seemingly a passive or reluctant participant in his wife’s dealings.

But testimony of John Piscitelli, a Virginia Beach stock broker and godfather to the McDonnells’ youngest daughter Rachel, portrayed Bob as a willing and active collaborator in the handling of the Star Scientific stock, even as Maureen went to great lengths to conceal public disclosure of her ownership of the stock. As summarized by the Times-Dispatch:

In June 2011 Jonnie Williams wrote Maureen a $50,000 check in advance of her trip to Florida to promote Star’s Anatabloc supplement at an investors meeting. She used $30,000 of the loan to purchase shares of Star Scientific stock. State disclosure law required the governor to list securities held at the end of the year if the value exceeded $10,000. Maureen asked Piscitelli how she might maintain ownership of the stock without keeping it in her name. That proved impractical, so she sold the shares in December 2011 and bought back the stock in January 2012, thus dodging the reporting requirement.

There had been no evidence presented that Bob knew about any of this activity, and given Maureen’s proclivity for doing things behind his back, it seemed plausible to suggest that he remained ignorant of it. However, Piscitelli testified of a February conference call with both Bob and Maureen in which they discussed opening a second brokerage account, also in Maureen’s name, into which they would deposit Star Scientific stock. The plan was to borrow against the value of the securities.

Here’s the killer (quoting from the T-D account): “Piscitelli acknowledged that during the conversation,  the governor thanked him for helping his wife in other transactions.”

This opens up the possibility that the governor was more deeply involved in Maureen’s stock-trading activities than has been revealed so far. If he doesn’t have a plausible explanation for this testimony from a close family friend, jurors will be asking themselves what else he knew.

The Beat Goes On…

Bill Hazel, secretary of health an human resources. Photo credit: Virginian-Pilot.

Bill Hazel, secretary of health an human resources. Photo credit: Virginian-Pilot.

Testimony continued yesterday in the Maureen and Bob McDonnell corruption trial as the prosecution brought more witnesses to the stand. There were no major revelations but trial junkies were treated to a number of small but telling details.

Snake oil. We’ve known from the beginning that Bill Hazel, former governor McDonnell’s secretary of health and human resources, was skeptical of Star Scientific CEO Jonnie Williams, Sr.’s claims regarding the company’s Anatabloc supplements. We just didn’t know how skeptical. It turns out that Hazel regarded Williams as one step removed from a snake oil salesman. He found Williams’ claims “unbelievable,” adding, “I won’t even put the stuff in my mouth.” What’s not clear is how forcefully he conveyed that skepticism to the McDonnells.

A couple in love. The McDonnells struck Sarah Scarbrough, then-director of the Executive Mansion, as a “happy, in-love couple.” The governor made time for his family and “worshiped the ground” that Maureen walked on, frequently kissing her on the cheek. Scarbrough’s testimony buttressed that of Mary-Shea Sutherland, the first lady’s chief of staff, that the McDonnells had regular family dinners together and made romantic gestures to one another. Sutherland had described previously how Maureen had sought to purchase a yellow dress because the governor had “fallen in love with her in yellow,” and how Bob had composed her a “lovely” poem. Then, of course, there was the infamous $6,000 Rolex watch that Maureen gave Bob for Christmas.

These recollections seemingly conflict with the defense’s claim that the couple’s relationship was so rocky that they barely spoke to one another, making it implausible that they would conspire on how to trade favors for gifts with Williams. However, Scarbrough did say she did not believe that the couple communicated well with each other.

Scarbrough also confirmed Sutherland’s testimony that Maureen was often sad and upset and that her management style was “her way or no way.” The first lady also could be sneaky. On more than one occasion she would invoke her husband’s name to get things done, such as the time she ordered Anatabloc placed in gift bags handed out at a function when, in fact, the governor had asked for no such thing.

Maureen’s friend. One of the few concrete actions Bob McDonnell took on behalf of Jonnie Williams was setting up an interview with health secretary Hazel. As Hazel recounted the event, the governor told him that Williams was a “very good friend” of his wife’s and “he wanted me to meet with him.” That quote supports my narrative that Maureen was the driving force behind granting favors to, and soliciting gifts from, Williams (again, with the possible exception of the real estate loans), and that (most of the time) McDonnell went along to avoid conflict with his wife. By asking Hazel to meet with a good friend of his wife, as opposed to a good friend of his, he was distancing himself from the request.

More meddling. Hazel’s testimony highlighted another favor Maureen did for Williams: meddling in a “Healthcare Leaders” luncheon at the governor’s mansion organized in February 2012. Maureen insisted upon adding multiple guests affiliated with Star Scientific to the guest list. Hazel refused to use his department’s budget to pay for the added guests. ““I was not excited to see these outsiders, who were not considered leaders, involved,” Hazel said.

I’m still sticking with my narrative that the McDonnell marriage was a mess. Even bad marriages have ups as well as downs, depending upon the mood swings of the more erratic partner. I find it entirely plausible that Bob would try to sooth an unhappy spouse, who felt lonely and neglected, through occasional displays of affection. I also find it plausible that the first couple would try to put on a brave front for the benefit of outsiders. Still, there’s no denying that the testimony is ambiguous. Any objective person would have to remain open-minded on the issue.

A reminder to my blog critics: An interpretation of the testimony that says Maureen was the motive force behind the exchange of gifts and favors with Williams while Bob went along reluctantly to avoid conflict (with my usual caveat regarding McDonnell’s submission of incomplete information on loan documents)  does not justify any illegal or unethical actions either one of them might have taken. People do things they shouldn’t do for all sorts of reasons — greed, lust, revenge, whatever. A reluctant lawbreaker is a lawbreaker nonetheless. By exploring the personal dynamics in the McDonnell family, I am not “defending” anyone. I am not trying to exonerate anyone. I’m simply trying to understand what went so wrong and reach a conclusion, as the jury will have to do, of whether the McDonnells are guilty or innocent of the charges with which they are being tried.

Out of Control

Mary-Shea Sutherland. Photo credit: Times-Dispatch

Mary-Shea Sutherland. Photo credit: Times-Dispatch

by James A. Bacon

With each new day of testimony, the trial of Maureen and Bob McDonnell is becoming more a trial of Maureen and less a trial of Bob. There was abundant evidence in previous testimony that the former first lady was out of control, sending members of the former governor’s staff scrambling to rein in inappropriate behavior. But yesterday’s testimony revealed that life was even worse inside the governor’s mansion, where there was no buffer between Maureen and those who worked under her. It is increasingly clear that the first lady was the motive source of the outrageous behavior that prompted the charges against her husband and her.

As Mary-Shea Sutherland, former chief of staff to the first lady, described her in testimony yesterday, Maureen was the boss from hell. Sutherland depicted Maureen as “a screamer” and a “nutbag” who frequently tongue-lashed the staff. The incidents were so frequent and so bad that Sutherland conferred with Bob’s chief of staff, Martin Kent, about incidents involving Maureen, including “a lot of yelling and screaming” about reimbursements the first family would have to make to the state.

“It was almost two years of emotional stress,” Sutherland testified. “I couldn’t protect the staff. It was a state of constant stress; going to work in the morning with your stomach in a knot.”

Finally, Sutherland couldn’t take it anymore and started looking for another job. She approached Jonnie Williams Sr., president of Star Scientific, who has testified that he lavished gifts upon the McDonnells in the hope of gaining their assistance in promoting his Anatabloc vitamin supplement. Williams promised her a job, backed down and then told Maureen about it. That disclosure, reports the Times-Dispatch, sent the first lady on a tear through Sutherland’s office. Maureen demanded Sutherland’s computer password and rifled through her desk.

Sutherland’s testimony is of more than voyeuristic interest. It further illuminates the dysfunction within the governor’s household during a period in which Maureen and Bob McDonnell accepted gifts and loans from Williams exceeding $150,000 in value and acted in various capacities to promote his product and solicit state research funds for his company. So far, the evidence suggests that Maureen initiated all, or nearly all, of the incidents under investigation.

That is not to condone Bob’s behavior in going along — it is simply to explain it. I have conjectured that Bob engaged in conflict-avoidance behavior, torn between doing what he knew to be ethical and a desire to escape his wife’s harangues. I believe that Bob labored long, workaholic hours on state business, in part to avoid a conflict-ridden home life, and left his wife to rule the roost. Previous testimony, by son Bobby McDonnell, describes how McDonnell had objected to Bobby accepting a gift of new golf clubs from Williams but how Bobby and Maureen overrode him.

By facilitating meetings between Williams and state officials, a routine favor dispensed by governors, and by appearing at promotional events, Bob sought to do enough to assuage Maureen but not too much, he hoped, to cross into illegality. He may have crossed the line, however, when accepting loans from Williams to bail out his bad real estate investments and, allegedly, conspiring to hide the transaction. (We’ll have to hear his testimony before drawing firm conclusions.)

Sutherland’s testimony provides other clues about the McDonnell-family dysfunction. Maureen’s out-of-control behavior may well have been the cause of the family’s terrible finances in the first place. As she told Sutherland while shopping for her inaugural wear in New York, her credit cards were “maxed out.” In other words, Maureen had been trying to live a champagne lifestyle on a beer budget long before she reached the governor’s mansion and met Jonnie Williams.

Maureen told Sutherland that her family was “buried in debt” due to expenses and sagging real estate investments. Notably, though, she did not want to sell the family’s $835,000 home in Wyndham, in the affluent West End of Henrico County. That remark was highly revealing.

Let’s do a little math. Let’s assume the McDonnells paid a 20% down payment when they purchased the house in late 2005/early 2006 when Bob took the job of attorney general. That would have left them with a mortgage of about $670,000. Let’s assume they paid a 7% interest rate, which was prevalent at that time. That would imply annual payments of principal, interest, taxes and insurance of more than $50,000 a year, or a third of the AG’s salary and more than is financially prudent. It’s possible that they refinanced at lower rates in later years, bringing down the payments somewhat but the overall burden would not have changed significantly. If they paid a smaller down payment, the burden would have been commensurately higher. Continue reading

The Damage-Control Patrol

Jason Eige (left) with Bob McDonnell on Legislative Day, 2013. Photo credit: Times-Dispatch.

Jason Eige (left) with Bob McDonnell on Legislative Day, 2013. Photo credit: Times-Dispatch.

by James A. Bacon

In New Jersey’s Bridge-gate scandal, Governor Chris Christie was cursed (if you believe his story) by underlings who made bad decisions that landed him in political hot water. In Virginia’s Gift-gate scandal, former Governor Bob McDonnell was blessed by underlings whose advice and actions kept him out of trouble — at least in those matters in which they were consulted.

But Jasen Eige, Phil Cox and Molly Huffstetler — all three of whom testified at the McDonnell trial yesterday — were powerless to protect the governor and his wife Maureen from bad judgment in matters they kept entirely to themselves.

As Jim Noland and Frank Green sum up the day’s testimony for the Times-Dispatch, “It is clear that a number of the governor’s aides and political advisers either were wary of [Star Scientific CEO and favor-seeker Jonnie] Williams, did not take him seriously or warned the first couple about the appearance caused his by his ostentatious gifts.” But they were unaware of the extent to which Williams was bankrolling the family because the McDonnells never told them.

McDonnell’s aides frequently engaged in damage control.

  • The dress. When Williams offered to buy Maureen McDonnell an Oscar de la Renta dress for the inaugural ball, Jason Eige, senior policy adviser to McDonnell, nixed the offer. With the company coming out of a recession, it would not look good for her to wear such expensive apparel. Phil Cox, the governor’s former campaign manager, also acted to dissuade the First Family from accepting the gift.
  • The clinical trials. When the governor e-mailed him about meeting to discuss Virginia Commonwealth University and University of Virginia research support for Williams’ Anatabloc dietary supplement, Eige warned, “We need to be careful with this issue.” It is not clear from newspaper accounts whether that meeting ever transpired, but it appears that the governor did not pursue the matter.
  • The clinical trials (redux). Huffstetler, a top aide to Health and Human Resources Secretary Bill Hazel, met at the governor’s request with Williams and the First Lady in her office for an hour. She listened to Williams’ pitch for state support then responded with “a blowoff email.” In private, she referred to Williams as “the Tic Tac man.” The governor did not pursue the matter.
  • The board appointment. When Maureen inquired about an appointment to the Star Scientific board, Eige expressed his concern that such an appointment would have “bad public optics.” That ended that.
  • Tobacco money. When Maureen complained that VCU and UVa were not applying for grant money from the Tobacco Indemnification and Community Revitalization Commission to research Anatabloc, and asked to set up a meeting, Eige stalled. Even though the first lady had stated the governor shared her concern, Eige never heard from him. The stall worked and the meeting was never scheduled.
  • The launch luncheon. Maureen arranged the use of the governor’s mansion to host the product launch of Anatabloc. Eige and other top aides warned that was not an appropriate use of state property. Eige managed to downgrade the event from a product launch to a luncheon in which Williams would distribute research grants to medical school researchers. He and Communications Director Tucker Martin also edited a Star Scientific press release to remove mention of the Governor and First Lady to avoid the appearance that they were endorsing a particular product.
  • Pitching Ann Romney. On a campaign bus with Republican candidate Mitt Romney and his wife, Maureen pitched Ann Romney on the benefits of Anatabloc. “I was horrified,” testified Cox. “I thought it was a train wreck. I thought it was improper that Maureen would try to push this product on Ann Romney.” He interrupted the sales pitch at a break in the conversation and helped change the subject.

Here’s my hypothesis of what was going on. Bob McDonnell didn’t like saying, “No,” to his wife. (Perhaps we’ll get testimony of what domestic life was like in the governor’s mansion but testimony so far suggests that she had a very bad temper.) He knew that some of the things she wanted to do were either potentially illegal or had “bad optics” but didn’t have the emotional stamina to stand up to her nagging and harangues. It was easier to kick things over to staff and let them take the heat.

And take the heat they did. As Eige testified in connection to block the purchase of the Oscar de la Renta dress, the first lady “wasn’t happy with us [regarding] the dress situation.” Likewise, Cox described her response as “an insane rant of an e-mail.” In a different incident, according to Willliams, Maureen’s chief of staff Mary-Shea Sutherland asked him for a job, confiding that “she was tired of the way she was treated.”

It is notable that McDonnell never applied pressure on his staff to do anything other than meet with Williams. He could plausibly say to Maureen and Williams (my quotes) that he “did something” by setting up a meeting, which was a routine gubernatorial practice, but “there was only so much he could do.” As a former Attorney General, McDonnell assuredly knew where the line of legality was, and he knew not to cross it…. in most instances.

As some have observed, it is “ungallant” to heap the blame on Maureen. But it’s hard to avoid doing so. Every scintilla of evidence presented so far suggests that the first lady was out of control. When frustrated, she flew into fits of anger. Her husband couldn’t handle her. His aides were continually running damage control.

As far as McDonnell himself, the most troubling evidence to surface to date is that which suggests he conspired with Williams to take two real estate loans totaling $70,000 to bail out his bad real estate investments and discuss how to cover up the transaction. I withhold judgment until McDonnell gives his side of the story. But he’s got some serious explaining to do.

Confessions of the Tic-Tac Man

Jonnie WilliamsBy Peter Galuszka

On afternoon last week, I was leaving the seventh floor courtroom at U.S. District Court  after Judge James Spencer called for a break. Jonnie R. Williams Sr., the prosecution’s star witness against former Gov. and Ms. McDonnell, had been on the stand for hours, playing various roles as remorseful solicitor, confident businessman, and obstructionist witness.

It just so happened that Williams and I were going to cross paths in the crowded outchamber of the courtroom. Without missing a beat, Williams stopped walking, made eye contact with me, and graciously held out his arm to signal that I should pass first.

I have no idea if Williams knew who I am, but the summer before, I had tried repeatedly to interview him for a serious of reports I was writing about Star Scientific, the tobacco company turned dietary supplement that is at the core of the trial against the McDonnells in perhaps the most important ever corruption trial in Virginia history.

Williams, 58, had been on the stand for four days, dressed as always in a shiny, expensive suit, his thinning hair coiffed around a high, bulbous forehead.

He has a strange voice, soft and proper, that sounds at times like an elder Marlon Brando or, without the harshness, Strother Martin, the man who played the cruel prison warden in the Paul Newman movie “Cool Hand Luke.” Either way, Williams does have a remarkable presence and he always seems to be selling, selling, selling something — either Anatabloc, his product that he claimed could do anything from cure Alzheimer’s to MS, or simply to promote  his own persona.

Williams, who has extensive immunity from the government, keeps underlining that his deal that could keep him out of jail, which means he must be honest. Honest means making “mea culpas.” They must sound sincere. When he said he pressured Maureen to get Bob to call his aging father on his 80th birthday, he recalled:  “That cost me hundreds of thousands of dollars to be able to do that,” he said. “The McDonnells were not my personal friends. It was good for my company,” noted Williams, who gave them more than $150,000 in gifts, loans, trips and cash.

That’s one version of Jonnie — pensive, regretful, honest. There was another one as well that came out when defense lawyer William Burck asked him to talk about his background in business. It was ego bait that Williams couldn’t resist.

It all came out — the confident kid from Fredericksburg who went to a little known business college in Rhode Island and came home to sell used cars and then took over a faltering eyeglass shop, learning how to pick up on one entrepreneurial idea and spin it into another.

Name dropping is a critical part of the Williams psyche, showing how impressed Williams was that his keen intellect had attracted helpful personalities far beyond his social kin. He keeps mentioning Johns Hopkins University Medical School and the “very bright” Dr. Frank O’Donnell who somehow came down from Baltimore and met Williams when he was working in the optical business. O’Donnell was a big league ophthalmologist, Williams said, and served as his mentor, even when he moved to the Midwest. Dr. O’Donnell came in with one business deal after another. One helped lead him to making machinery to cure near-sightedness, earning him millions and securing his personal finances.

Perking up during testimony, Williams ticked off medical terms as if he were the head of a medical school department. He also had developed a keen sense of what could and could not be said in good company, sort of like a small town boy of modest background who’s being let into the local country club for the first time.

When he took the McDonnells and a few others to La Grotta, an expensive Italian restaurant in downtown meeting after an Anatabloc session, he picked thousands of dollars’ worth of wine and informed the courtroom and jury that it was bad form to let your guests know if it’s $50 a bottle vintage of $500 a bottle. Of course, when he picked out the Louis XIII cognac for his male model friend, the McDonnells and some of their staff at a New York eatery in 2009, he was proud to reveal it cost $5,000.

“I really didn’t like it all that much but some people do,” he said. He also didn’t really like the Ferrari that he made a big effort to drive to Smith Mountain Lake in July 2011 so McDonnell could drive it at Maureen’s request while vacationing for free at Williams waterfront house. Williams says he prefers his Toyota Camry.

This same snobbery constantly extends to the medical and business hot shots who were helping build the idea that Williams’ use of anatabine, a substance found in tobacco, had remarkable curative powers. Jonnie was more than willing to tell you all about it, over and over, in his slow, calm, methodical voice.

Maureen McDonnell, who is being set up as the Fall Girl by her own lawyers, bought into the Williams’ spiel, big time. McDonnell’s professional staff, including Phil Cox and Jasen Eige, testified that they were deeply worried about Williams and kept on telling the governor to limit his engagement.

Smitten by Williams, Maureen kept pushing Jonnie and his miracle supplements, somehow overlooking the fact that there hadn’t been clinical trials on it and that Star Scientific had lost $230 million over the past decade (she still bought stock anyway despite Williams testimony that he told her it was a bad idea).

Rank and file Virginia researchers, whose imprimatur Williams so badly wanted, also were suspicious. When he’d show up pushing pills as samples, they called him the “Tic Tac Man.”

Cantor’s Self-Serving Special Election Scheme

cantor By Peter Galuszka

It looks like a small group of the Virginia Republicans elite has once again hatched a plot behind closed doors to manipulate elected politics without input from voters.

U.S. Rep. Eric Cantor, the victim of a surprising defeat in a June 10 Republican primary, has come up with a self-serving scheme to resign Aug.18 and finagle a special election Nov. 4 to pick his successor. The special election would be held along with a regularly scheduled one.

Normally, opposing candidates Republican David Brat and Democrat Jack Trammel, would routinely face election that day. With Cantor’s proposal, the winner of the special election for the 7th Congressional District seat would be able to take office immediately, instead of having to wait for usual matriculation of the other 434 Congressmen in January.

This is a back-door, move-to-the-head-of-the-class scheme. Presumably, the winner would be Brat who, taking office in November, would be placed ahead of other Congressional newcomers when it comes to coveted committee assignments. Good for the GOP. Bad for Democrats.

For Cantor, of course, it is a Big Win. Since his unexpected and earth-shaking defeat, the 51-year-old has been seen at such posh places as the Hampton is on the tip of Long Island schmoozing with Big Money. Cantor does have an advanced degree from Columbia in real estate finance and his wife was once a New York securities trader. Big Finance, along with Big Pharma and Big Managed Care, has been one of his biggest sources of election funds.

Larry Sabato, the University of Virginia political expert, by turns thought Cantor’s idea “generous” but also noted ”it’s highly probable that he has a deal in the works for his post-Congress life, and he’s eager to get it started,” Sabato was quoted as saying.

As might have been expected, Cantor made his announcement in the Richmond Times-Dispatch, his lapdog newspaper. Editors gushed that his announcement “features an extraordinary column by an extraordinary human being.”

It shows extraordinary cluelessness as well. Cantor, the Main Street Republicans and the TD’s club of Richmond elites don’t seem to understand that it is their very exclusivity that helped do Cantor in and give an upstart like Brat the edge.

Consider a cover story package that I co-wrote in the Chesterfield Monthly, one of the Richmond area’s up-and-coming publications. I found that it wasn’t just that Cantor ignored his district that did him in – it was a putsch by some rather annoyed Libertarians of the traditional ilk and small government moderates plus the Tea Party.

Leaders of the “malcontents” were lawyer Patrick McSweeney and Tea Party leader Jamie Radtke who ran unsuccessfully for U.S. Senate in 2012. In the “Bull Elephant” blog, Radtke compared Cantor and his Confederates as “mobsters” running around and snuffing out dissent among local conservatives.

Brat himself was ultra pissed off a couple of years back when he wanted to get the Henrico County GOP nod to run and replace Bill Janis. But, functioning as the old Soviet Politburo might have, a tiny group of Republican elders decided that the candidate would be Peter Farrell, the young son of utility powerhouse chieftain Tom Farrell of Dominion. In other words, it wasn’t exactly a day for waving the stars and stripes of Democracy. It was pure, Big League, Big Business inside diktat that could have taken place behind the crenelated walls of the Kremlin.

They didn’t give Brat a chance,”analyst Bob Holsworth told me. “That gave Brat the interest in taking on this Don Quixote-type campaign.

Now we get another closed-door deal. Hopefully, voters, conservative and liberal, will fire back.

Elections have consequences

by D.J. Rippert

What a difference two years make. In the run up to the 2012 election Barack Obama and Mitt Romney debated foreign affairs. Obama had recently been caught making an offhand comment over an open mike to Russian President Dmitry Medvedev. Obama promised the Russian that he (Obama) would have “more flexibility” with Russia after the election. Obama used the subsequent televised debate to ridicule Romney for considering Russia a geopolitical foe.

The liberal reaction. The liberal screech-o-sphere went into overdrive after the debate taking Romney to task for his obvious stupidity in considering Russia a potential problem for the United States.

From Mediaite.com:

  • “I don’t know what decade this guy’s living in,” MSNBC host Chris Matthews said with a sigh on March 28, 2012. “Is he trying to play Ronald Reagan here, or what?”
  • Huffington Post reporter Sam Stein agreed that Romney’s statement was evidence of an “antiquated worldview.” He fretted further about how Romney, should he become president, would enter the office having severely complicated America’s bilateral relations with Moscow given his carelessly provocative statement.
  • I can appreciate why the Romney campaign would try to make Obama’s “hot mic” story interesting, but the problem is the former governor just doesn’t have any real policy chops in this area. He’s out of his depth, and struggles when the subject takes center stage. (Rachael Maddow)
  • Calling Romney’s comments “a throwback to the Cold War,” [Andrea] Mitchell insisted that “we work with Russia all the time.” “Hardly an ally but certainly not an adversary,” she declared.

Crimea river.  Russia, under the leadership of Vladimir Putin, has effectively occupied Crimea.  He has armed rebels in Ukraine and those rebels used his arms to shoot down a passenger airliner.  The Russian backed rebels have prevented investigators from seeing the crash site or even recovering all the bodies of those who they murdered.  Today, U.S. and NATO countries are insisting that they will defend NATO countries with military force if confronted by Russia.

The pet theories of liberalism.  The next time some liberal advances one of their pet theories on say … immigration reform, global warming or medicaid expansion replay the clip from the 2012 debate.  Then, replay the MSNBC clips of various liberal media stooges ridiculing Romney for his warnings about Russia.  As my father used to say, “Liberals are often wrong but never in doubt.”

From Sordid to Squalid

Bob McDonnell leaves the federal courthouse in Richmond yesterday. Photo credit; Washington Post.

Bob McDonnell leaves the federal courthouse in Richmond yesterday. Photo credit; Washington Post.

by James A. Bacon

A sordid tale grew even more squalid yesterday as Jonnie Williams Sr., the star witness against Maureen and Bob McDonnell, spent the day on the witness stand. Williams, the former CEO of vitamin-supplement maker Star Scientific, declaimed that, despite all the time he had spent with them and gifts he had lavished upon them, the McDonnells “were not my friends.”

Williams also elaborated upon the grabbiness of McDonnell family members, which extended beyond designer clothes, a wedding reception, real estate loans, golf outings, the use of his private jet, landscaping services, a weekend getaway at Smith Mountain Lake and a Rolex watch. At the prompting of her mother, McDonnell daughter Cailin informed Williams that she had picked out a car for him to buy her. A McDonnell finally bumped up against the limits of what Williams was prepared to do to win state support for his Anatabloc vitamin supplements.  “I told her I just couldn’t buy a car,” he testified.

But grabbiness is not illegal. The McDonnells’ behavior was stupefyingly gauche and beyond the pale of acceptable social behavior. It was grotesque to see in the First Family of Virginia. But grabbiness does not, in and of itself, constitute corruption. It’s corruption only if the McDonnells performed substantive official acts in return for his largesse. And so far, the evidence of that is borderline. Williams received remarkably little for his $145,000-plus investment in the McDonnell family: a couple of introductions to state officials, the use of the Governor’s Mansion for a Star Scientific event, and three appearances by Maureen McDonnell at Star Scientific events outside the state. (I expect there to be considerable debate over whether these constitute unusual “official” actions.)

But if Bob McDonnell’s personal reputation was worthy of the Sears scratch-and-dent sale before the trial, it could well end up in the dumpster by the time this is over. To my mind, the most potentially damaging testimony yesterday concerned conversations between Williams and McDonnell to transfer stock certificates to McDonnell that he could borrow against to help with cash flow problems on his beach property. According to the Times-Dispatch reporting, Williams testified that he was concerned that such a deal would have to reported to the federal Securities and Exchange Commission, so he never went through with it. But he added this critical detail indicating McDonnell’s state of mind: He said that McDonnell told him that he had his own disclosure problem.

That revelation — if it goes uncontradicted by McDonnell — seems especially relevant to two of the charges against him. Count Twelve alleges that McDonnell failed to include a $50,000 loan from Williams when listing personal liabilities of $2,075,000 in a financial application to TowneBank. County Thirteen alleges that Maureen and Bob McDonnell omitted mention of what by then had grown to $120,000 in loans from Williams in a loan application to PenFed. (A small digression: The liabilities they listed had soared to $2.8 million by then, an extraordinary increase of roughly $750,000 over four months. That’s a story worth digging into.) If Williams’ story holds up that the governor was acutely aware of his own disclosure issues, it will be difficult for McDonnell to argue that those omissions were an unintentional oversight.

The defense attorneys are sure to paint Williams as a huckster, swindler and self-confessed liar (he admitted yesterday to laying to federal authorities when they first investigated the case) out to save his own skin, which, given his track record, won’t be hard to do. Such a strategy may keep the McDonnells out of jail but it won’t salvage their reputation. Any thinking person would have to ask: How astonishingly poor was McDonnell’s judgment to accept gifts from, and obligate himself to, such a snake?

Williams: How to Reach the High and Mighty

Photo by the Richmond Times-Dispatch

Photo by the Richmond Times-Dispatch

By Peter Galuszka

The McDonnell corruption trial has its high and low moments. One theme stands out: the trial is a guidebook of how to gain broach and compromise the power elite of Virginia politicians, in this case the Republicans.

Here are a few takeaways:

  1. Want to break in? Having a private jet is a must, testified former Star Scientific CEO Jonnie R. Williams Sr., also the government’s star witness with immunity from prosecution. By offering the jet to politicians and aides, you a captive audience for the length of the flight. Williams said he got up to six hours of almost undivided attention from Robert McDonnell when he and the former governor were flying in his plane across country from a campaign event with the GOP’s Meg Whitman, then running for governor of California in the Fall of 2010. That’s when they started talking in earnest about promoting Jonnie’s products. Richmond’s odd location is a problem with travel. Having your own plane helps the pooh-bahs bypass “ RIC, IAD, and DCA and fly directly to GOP.”

  2. Republicans like living large. Big names impress. Just after McDonnell won the governorship in 2009, he and his wife meet at the Four Season Hotel in Manhattan. Williams was there with his buddy, high fashion male model Brad Kroenig. During that meeting Ms. McDonnell thought it would be a great idea if she could get an Oscar de la Renta dress for the upcoming inaugural ball. Williams bought drinks, but not any drink. He blew $5,000 on a bottle a Louis XIII cognac. Asked by a defense lawyer why he did so, Williams replied, “I actually don’t care for it all that much but some other seem to.”
  3. Looking for funding under strange circumstances? Somehow Virginia’s Tobacco Indemnification and Community Revitalization Commission always seems to pop up. On his cross-country trip with Williams, McDonnell suggested it as a source of research funding for Williams’ Anatabloc dietary supplement., Williams said. Apparently the plan was to get the University of Virginia to ask for research money, keeping Star and the governor a step or two removed. McDonnell encouraged Williams to contact Jerry Kilgore, a former attorney general and partner at McGuire Woods. Jerry, who later became Williams’ lawyer, has a brother, Terry, who is head of the tobacco commission. In an unrelated matter, the tobacco commission was involved with the sudden and strange resignation this summer of state Sen. Phil Puckett just as a key vote on Medicaid expansion was to happen. The plan was for Puckett to take a top-paying, sinecure-type job at the tobacco commission but it didn’t work out once it was publicized.

As the trial continues, there may be other tips for success. I will pass them along as soon as I can.

Jonnie Williams: “This Was a Business Relationship”

Jonnie Williams (left), the prosecution's star witness, makes his appearance at the  federal courthouse.

Jonnie Williams (left), the prosecution’s star witness, makes his appearance at the federal courthouse. Photo credit: Washington Post.

by James A. Bacon

Virginia’s best soap opera in 20 years continued yesterday as Jonnie R. Williams, Sr., the star witness in the prosecution of former Governor Bob McDonnell and his wife Maureen, took the witness stand. Williams added little new substance to the public record that wasn’t listed in the indictments but he did flesh out a few details.

Williams made clear that his motives in assisting the Virginia’s First Family were purely mercenary. When asked why he lent his jet aircraft to McDonnell and other Virginia politicians, he said, “If you have a Virginia company, you want to make sure you have access to these people, and the airplane … accomplishes that. … He’s a politician, I’m a businessman.”

Explaining why he lent his jet to fly the governor to California and back, Williams said: “I figured that would give me five to six hours with the governor … to explain to him that I needed his help.”

Then, when asked if he regarded the first couple as personal friends, he responded, “This was a business relationship.”

The question is this: Did the McDonnells view the relationship the same way? If they did — if they viewed the relationship as a means to extract money and gifts in exchange for official favors — the feds have a strong case. If Bob and Maureen viewed the relationship differently, then it will be difficult to persuade a jury that they were engaged in a conspiracy to enrich themselves by misusing the authority of the governor’s office.

Defense attorneys made the prosecution’s case much more difficult to prove yesterday by claiming that the marriage was in tatters, there was a breakdown in communication between husband and wife, and that Maureen McDonnell, starved for attention, had a “crush” on Williams. A very clear implication is that Bob and Maureen had very different takes on the Williams relationship.

Only on one occasion, in October 2010, did Williams extract a “favor” from the governor directly, and that incident occurred before Williams began showering the family with personal gifts. When they were flying from California to Richmond in his jet, Williams told the governor about his anatabine vitamin supplement and asked for his help in getting Virginia’s medical schools to test it. McDonnell arranged a meeting with Bill Hazel, the Virginia secretary of health, but Hazel was unenthusiastic and the governor did not follow up or apply any other pressure. Governors routinely make introductions for campaign contributors, so the prosecution can’t make much of this event.

From there on out, Williams appears to have channeled his efforts through Maureen. Indeed, she was the one who initiated the requests for gifts — most notably the New York shopping expedition, the real estate loans and the wedding reception for daughter Caitlin. So, how was Bob responding to all of this? Apparently, he plans to tell the world his version of events at some point in the trial. Meanwhile, we have hints that he disapproved of some of the gifts, even while acquiescing to other largesse.

In December 2009, Williams offered to buy Maureen an Oscar de la Renta dress for an event in New York. Then he got a call from the governor’s office thanking him but turning down the offer. That call could not have occurred without the governor’s knowledge. It may have been initiated at his direction. One can surmise that, early in the relationship with Williams, McDonnell wanted to avoid the kind of entanglements that later ensnared him.

McDonnell also intervened when Williams bought son Bobby McDonnell a new set of golf clubs. As Bobby testified, “My father’s reaction was that I should give them back.” The gift, the father said, was excessive. (That’s after racking up thousands of dollars of expenses playing golf on Williams’ tab, so take McDonnell’s reservation with a grain of salt.) Interestingly, McDonnell lost that argument. Bobby said he had a friendship with Williams that was separate from his parents’ friendship; he viewed Williams as a mentor. Maureen sided with him. Bobby never returned the clubs.

The governor apparently also disapproved of Williams’ $15,000 gift to daughter Cailin to cover the cost of her wedding reception. Cailin had met Williams only briefly one time, shortly before in the Governor’s Mansion. Maureen had begged Williams for the money but she portrayed the situation very differently to Cailin, explaining, “Mr. Williams was so impressed with [her].” Dad apparently did not learn of Williams’ gift until federal investigators began asking questions about it. “He was very upset that she had taken that check,” Cailin testified.

The picture I’m getting is a man who lost control of his household. Bob McDonnell knew what was right and what was wrong but was unable to lay down the law. Working workaholic hours as governor, he was only intermittently engaged in family affairs and was incompletely informed. If Cailin’s statement is true that he didn’t learn of the $15,000 wedding reception gift until months later, it’s extraordinary that he was so disconnected from his own family finances. Meanwhile, Williams was engaging in routine communication with his wife — 1,200 phone calls and text messages — lending his jet to ferry around his children and playing golf with his sons. The governor told Bobby to return the golf clubs but couldn’t enforce his own edict.

While McDonnell may have had reservations about some of the gifts, it appears that he slid down a slippery slope. Eventually, he did accept a $20,000 wire transfer to help bail out MoBo Real Estate Partners, his underwater Virginia Beach real estate investment. So far, that seems to be the most damning piece of evidence against him. It will be interesting to see what kind of defense he mounts against that. So far, I have seen no sign of it.

One last observation: It’s one thing for a man like Williams to cozy up to the governor by befriending him personally or even he and his wife befriending the McDonnells as couples. It’s another thing to do so by cozying up to his wife (1,200 phone calls and text messages) and mentoring his son. Williams invested not just money but time in those relationships. Were his motives as purely mercenary as he now says? Was he really in it just for the business? Talk about cold and calculating! It says a lot about his character, too.