Sunday, January 15, 2006

All You Ever Wanted To Know About Abramoff

January 15, 2006
Op-Ed Columnist
Is Abramoff the New Monica?
THERE'S nothing this White House loves more than pictures that tell a story - a fictional story. And so another mission was accomplished when President Bush posed with the 13 past secretaries of state and defense he hustled into the Oval Office 10 days ago: he could pretend to consult on Iraq with sages of all political stripes - Madeleine Albright, yet - even if the actual give-and-take, all 5 to 10 minutes of it, was as substantive as the scripted "Ask the President" town hall meetings of the 2004 campaign.

But this White House, cunning as it is, can't control all the pictures all the time. That photo op was quickly followed by Time's Jack Abramoff cover and its specter of other images more inopportune than op. Mr. Bush's aides, the magazine reported, were busy "trying to identify all the photos that may exist of the two men together." Translation: Could a Bush-Abramoff money shot as iconic as Monica on the rope line be lurking somewhere for a Time cover still to come?

This much is certain: 1) The Abramoff scandal, so far anyway, boasts plenty of cigars but no sex. 2) It has almost everything else, including the "Miami Vice"-style rub-out of a Florida casino-cruise-ship mogul who'd had contentious business dealings with Mr. Abramoff. Not without reason is the White House on a frantic search-and-destroy mission to root out any potential embarrassments. Mr. Bush's expert stage managers are smart enough to know that this scandal may metastasize from a cancer on Congress to a cancer on the Republican Party in general and this presidency in particular.

Washington's jaded conventional wisdom will tell you otherwise. It says that Mr. Abramoff's bribing of congressmen to do his clients' bidding is the same old generic Capitol Hill scandal dating to Grant and Harding, differing only in the sheer scale of the numbers (of politicians implicated, of moolah changing hands). The many conservative pundits now deploring Tom DeLay take a similarly reductive line. "Washington power can corrupt absolutely," explained the Wall Street Journal editorial page while bemoaning that "people like Mr. Abramoff" came "to Washington to clean up Washington" and then were corrupted by the capital's evil ways. The DeLay Republicans, you see, are merely repeating the history of the decadent, power-fattened Democrats who preceded them, most especially Jim Wright, the speaker of the House who resigned in 1989.

If it's all Washington's fault, of course, it's not the G.O.P.'s fault; the scandal can be quarantined to a few (or a dozen) bad apples who were seduced by a lobbyist's skyboxes and not-so-petty Indian casino cash. But that theory of the case conveniently denies the quarter-century-old provenance of Mr. Abramoff. This scandal's particular greedy, power-crazed ethos wasn't created by Washington - it was imported to Washington by him and two pals destined to rise to the top of the G.O.P. establishment, Ralph Reed and Grover Norquist. These ruthless three musketeers first converged in the College Republicans hierarchy in the early 1980's, long before they obtained the Washington power that could corrupt them (and years before the Wright scandal).

They preached a take-no-prisoners strategy and a specific ideology - do away with taxes, privatize government, free business from any regulation - that changed Washington far more than Washington changed them. Their triumph can be found everywhere today, from Halliburton's no-bid contracts in Iraq to the K Street project, a Norquist-championed and DeLay-sanctioned operation to intimidate corporations with business before Congress into hiring exclusively Republican lobbyists like Mr. Abramoff.

But it's not only the genealogy of the Abramoff scandal that separates it from its predecessors. So does the distinctive odor of its possible criminality. In its financial shenanigans and some of its personnel, the Abramoff affair doesn't so much echo Teapot Dome as the business scandal that engulfed Mr. Bush's former No. 1 corporate patron, Enron, in our new century. The Abramoff scandal's pious trappings are sui generis as well. They adhere to the Karl Rove playbook that wraps every hardball White House tactic in godliness and exploits "faith based" organizations as political machines to deliver the G.O.P.'s religious right base.

To see these similarities and synergies you don't need to know the difference between the Choctaws and the Marianas. Look instead at the Alexander Strategy Group, the lobbying outfit that is ground zero for the scandal (and that went kaput last week). Founded by Mr. DeLay's former chief of staff and personal pastor, an evangelical minister named Edwin Buckham, its early big client was Enron. And like Enron, which laundered money through sham financial entities with "Star Wars" names like Chewco and JEDI, it benefited from a shell organization with a fanciful, albeit faith-based, name: the U.S. Family Network.

The U.S. Family Network was formed by Mr. Buckham on the side, ostensibly as a grass-roots advocacy organization to promote, among other virtues, "moral fitness." As The Washington Post discovered last month, its financial backers were amoral, favor-seeking Abramoff associates, from casino operators to Russian oil businessmen. The U.S. Family Network's contribution to moral fitness and U.S. families, meanwhile, was close to nil - except for the DeLay family. The Post reported that hundreds of thousands of the network's dollars were siphoned into Mr. Buckham's lobbying shop, which in turn put Mr. DeLay's wife on salary. U.S. Family money also purchased a Washington town house used by Mr. DeLay for fund-raising. Enron's Andrew Fastow couldn't have drawn up a more imaginative flow chart for distributing dubious gains to a favored few on the q.t.

The U.S. Family Network was only one of several phantom Enron-style shams spawned or fronted by Mr. DeLay, Mr. Abramoff or their sometimes clerical cronies, from Celebrations for Children (a "charity" whose good works remain a mystery) to the American International Center (a "think tank" manned by a lifeguard in Rehoboth Beach, Del.). The Capital Athletic Foundation, supposedly set up to provide sports programs for needy urban kids, underwrote a 2002 golf outing to Scotland for Mr. Abramoff, Congressman Bob Ney of Ohio, Ralph Reed (an Enron consultant in his post-Christian Coalition days) and David Safavian, the Bush administration's top procurement official, who resigned in September just before being indicted on charges of lying and obstruction of justice in the Abramoff investigation.

Abramoff & Company pursued a "careful cultivation of relations with Bush's political team as far back as 1997," according to The Associated Press. One contact was J. Steven Griles, a mining industry lobbyist who, topically enough, tried to weaken mine regulation during his government tenure as No. 2 in Mr. Bush's Interior Department. The department also handles Indian affairs, but Mr. Griles has said he does not "recall intervening on behalf of Mr. Abramoff's clients ever" when in government.

Mr. Abramoff himself served on the Interior Department's transition team after the 2000 election. Perhaps it's this steady drip of revelations, including those about his White House access as a "Pioneer" delivering at least $100,000 to the Bush campaign, that has frightened the administration into suddenly speaking out about the scandal. Scott McClellan is now also using that helpful verb recall - as in the president does not "recall" ever meeting Mr. Abramoff (an artful dodge if photos surface). Mr. Bush has disingenuously explained that the lobbyist had been an "equal money dispenser" to those "in both political parties." (To both, yes, but never equally.)

If this all sounds a little familiar, that's because it replays the White House game plan after the Enron meltdown. Mr. Bush then suggested that he had inherited his relationship with Ken Lay from Ann Richards, his Democratic predecessor as Texas governor, and suddenly took to referring to the backer he had once nicknamed Kenny Boy as Mr. Lay. You'd never guess that Enron brass had helped pay Mr. Bush's campaign expenses for the Florida recount, contributed $300,000 to the inaugural gala and attended four meetings of Dick Cheney's secret energy task force.

As fate would have it, the court appearances of Mr. Lay, Mr. DeLay, Jeff Skilling, Mr. Safavian and Mr. Abramoff could all overlap on 24/7 cable in the months ahead. There will surely be much talk of God along the way. Mr. DeLay's pastor, Mr. Buckham, and Mr. Reed were not the only prayerful players in the Abramoff casino. So were the Rev. "Lucky Louie" Sheldon of the Traditional Values Coalition and the right-wing Rabbi Daniel Lapin, whose Toward Tradition organization received a $25,000 check (in all innocence, we're told) from the Abramoff client eLottery. In 2002, the good rabbi welcomed the lobbyist onto the board of his American Alliance of Jews and Christians, along with Jerry Falwell and the man who loves Israel literally to death, Pat Robertson.

In between Mr. Abramoff's guilty pleas in Washington and Florida, he let it be known that he was busy writing Torah commentary. What is the inspiration for all this religiosity? Though raised by an unobservant family, Mr. Abramoff has said that he resolved to become an Orthodox Jew at the age of 12 after seeing "Fiddler on the Roof." Now that he's ratting on all his cronies to reduce his own sentence, they, too, will learn what it means to journey from the vainglorious fantasies of "If I Were a Rich Man" to the hard time of "Sunrise, Sunset."

Copyright 2006The New York Times Company

The Ultimate Cost of War

January 15, 2006
Economic View
When Talk of Guns and Butter Includes Lives Lost
AS the toll of American dead and wounded mounts in Iraq, some economists are arguing that the war's costs, broadly measured, far outweigh its benefits.

Studies of previous wars focused on the huge outlays for military operations. That is still a big concern, along with the collateral impact on such things as oil prices, economic growth and interest on the debt run up to pay for the war. Now some economists have added in the dollar value of a life lost in combat, and that has fed antiwar sentiment.

"The economics profession in general is paying more attention to the cost of lives cut short or curtailed by injury and illness," said David Gold, an economist at the New School. "The whole tobacco issue has encouraged this research."

The economics of war is a subject that goes back centuries. But in the cost-benefit analyses of past American wars, a soldier killed or wounded in battle was typically thought of not as a cost but as a sacrifice, an inevitable and sad consequence in achieving a victory that protected and enhanced the country. The victory was a benefit that offset the cost of death.

That halo still applies to World War II, which sits in the American psyche as a defensive war in response to attack. The lives lost in combat helped preserve the nation, and that is a considerable and perhaps immeasurable benefit.

Through the cold war, economists generally avoided calculations of the cost of a human life. Even during Vietnam, the focus of economic studies was on guns and butter - the misguided insistence of the Johnson administration that America could afford a full-blown war and uncurtailed civilian spending. The inflation in the 1970's was partly a result of the Vietnam era.

Cost-benefit analysis, applied to war, all but ceased after Vietnam and did not pick up again until the fall of 2002 as President Bush moved the nation toward war in Iraq. "We are doing this research again," said William D. Nordhaus, a Yale economist, "because the Iraq war is so contentious."

Mr. Nordhaus is the economist who put the subject back on the table with the publication of a prescient prewar paper that compared the coming conflict to a "giant role of the dice." He warned that "if the United States had a string of bad luck or misjudgments during or after the war, the outcome could reach $1.9 trillion," once all the secondary costs over many years were included.

So far, the string of bad luck has materialized, and Mr. Nordhaus's forecast has been partially fulfilled. In recent studies by other economists, the high-end estimates of the war's actual cost, broadly measured, are already moving into the $1 trillion range. For starters, the outlay just for military operations totaled $251 billion through December, and that number is expected to double if the war runs a few more years.

The researchers add to this the cost of disability payments and of lifelong care in Veterans Administration hospitals for the most severely injured - those with brain and spinal injuries, roughly 20 percent of the 16,000 wounded so far. Even before the Iraq war, these outlays were rising to compensate the aging veterans of World War II and Korea. But those wars were accepted by the public, and the costs escape public notice.

Not so Iraq. In a war that has lost much public support, the costs stand out and the benefits - offsetting the costs and justifying the war - are harder to pinpoint. In a paper last September, for example, Scott Wallsten, a resident scholar at the conservative American Enterprise Institute, and Katrina Kosec, a research assistant, listed as benefits "no longer enforcing U.N. sanctions such as the 'no-fly zone' in northern and southern Iraq and people no longer being murdered by Saddam Hussein's regime."

Such benefits, they found, fall well short of the costs. "Another possible impact of the conflict, is a change in the probability of future major terrorist attacks," they wrote. "Unfortunately, experts do not agree on whether the war has increased or decreased this probability. Clearly, whether the direct benefits of the war exceed the costs ultimately relies at least in part on the answer to that question."

The newest research was a paper posted last week on the Web ( by two antiwar Democrats from the Clinton administration: Joseph E. Stiglitz of Columbia University and Linda Bilmes, now at the Kennedy School of Government at Harvard. Their upper-end, long-term cost estimate tops $1 trillion, based on the death and damage caused by the war to date. They assumed an American presence in Iraq through at least 2010, and their estimate includes the war's contribution to higher domestic petroleum prices. They also argue that while military spending has contributed to economic growth, that growth would have been greater if the outlays had gone instead to highways, schools, civilian research and other more productive investment.

The war has raised the cost of Army recruiting, they argue, and has subtracted from income the wages given up by thousands of reservists who left civilian jobs to fight in Iraq at lower pay.

JUST as Mr. Wallsten and Ms. Kosec calculated the value of life lost in battle or impaired by injury, so did Mr. Stiglitz and Ms. Bilmes - putting the loss at upwards of $100 billion. That is more than double the Wallsten-Kosec estimate. Both studies draw on research undertaken since Vietnam by W. Kip Viscusi, a Harvard law professor.

The old way of valuing life calculated the present value of lost earnings, a standard still used by the courts to compensate accident victims, generally awarding $500,000 a victim, at most. Mr. Viscusi, however, found that Americans tend to value risk differently. He found that society pays people an additional $700 a year, on average, to take on risky work in hazardous occupations. Given one death per 10,000 risk-takers, on average, the cost to society adds up to $7 million for each life lost, according to Mr. Viscusi's calculation. Mr. Stiglitz and Ms. Bilmes reduced this number to about $6 million, keeping their estimate on the conservative side, as they put it.

None of the heroism or sacrifice for country shows up in the recent research, and for a reason.

"We did not have to fight this war, and we did not have to go to war when we did," Mr. Stiglitz said. "We could have waited until we had more safe body armor and we chose not to wait."

Copyright 2006The New York Times