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The Stories You Missed in 2009

Project Censored reveals its underreported stories of the year

Dec. 30, 2009
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If you relied on the corporate-owned mainstream news sources, then you missed these underreported stories:

Mysterious Death of Mike Connell, Karl Rove’s Election Thief

Karl Rove’s chief IT consultant, Mike Connell—who was facing subpoena in connection with 2004 presidential election fraud in Ohio—mysteriously died in a private plane crash in 2008. Connell allegedly was the central figure in a long-standing plot to electronically flip votes to Republicans.

In July 2008, Connell was named as a key witness in a lawsuit filed in 2006 by Columbus attorneys Clifford Arnebeck and Robert Fitrakis charging Ohio Secretary of State Ken Blackwell with racially discriminatory practices—including the selective purging of voters from the election rolls and the unequal allocation of voting machines to various districts.

The case took on fresh momentum in July 2008 when Arnebeck made another filing, inspired in part by GOP IT security expert Stephen Spoonamore coming forward as a whistle-blower. Spoonamore said he was prepared to testify to the plausibility of electronic vote-rigging having been carried out in 2004.

Spoonamore, a conservative Republican who works for big banks, international governments and the Secret Service as an expert in the detection of computer fraud, found evidence that Karl Rove, with the help of Mike Connell and his company GovTech Solutions, electronically stole the Ohio 2004 election for Bush.

Spoonamore testified that the “vote tabulation system [which Connell designed] allowed the introduction of an additional single computer between computer A and computer B.” This is called a “man in the middle” attack. According to Spoonamore, “This centralized collection of all incoming statewide tabulations would make it easy for a single operator, or a preprogrammed ‘force balancing computer,’ to change the results in any way desired by the team controlling the Computer C.” Connell was ordered to appear for a two-hour, closed-door deposition on Nov. 3, 2008, just 18 hours before the 2008 election.

Arnebeck said he had evidence that Rove threatened Connell, cautioning that if Connell didn’t “take the fall” for election fraud in Ohio, Connell would face prosecution for supposed lobby law violations. After this threat, Arnebeck sent letters to the Department of Justice, as well as messages to high-ranking members of the department, seeking protection for Connell and his family from attempts to intimidate.

Election fraud analyst and author Mark Crispin Miller notes that the timing and circumstances of Connell’s death—between deposition and trial—are too suspicious and convenient for Rove and the Bush administration not to merit a thorough investigation. Arnebeck and Fitrakis intended to both further depose Connell and call him to testify as a key witness in the federal conspiracy case.

Congress Sells Out to Wall Street

Federal lawmakers responsible for overseeing the economy have received millions of dollars from Wall Street. Since 2001, employees from eight of the most troubled firms have donated $64.2 million to congressional candidates, presidential candidates and the Republican and Democratic parties. As senators, Barack Obama and John McCain received a combined total of $3.1 million. The donors include investment bankers from Bear Stearns, Goldman Sachs, Lehman Brothers, Merrill Lynch, Morgan Stanley, insurer American International Group (AIG) and mortgage giants Fannie Mae and Freddie Mac. %u2028

Some of the top recipients of contributions from employees of companies receiving Troubled Asset Relief Program (TARP) money are the same members of Congress who chair committees charged with regulating the financial sector and overseeing the effectiveness of this unprecedented government program. Nearly every member of the House Financial Services Committee, who in February 2009 oversaw hearings on how the $700 billion of TARP bailout was being spent, received contributions associated with these financial institutions during the 2008 election cycle. “You could say that the finance industry got their money’s worth by supporting members of Congress who were inclined to look the other way,” said Lawrence Jacobs, the director of the University of Minnesota’s Center for the Study of Politics and Governance.

Since the start of 2009, Wall Street has donated $12.6 million—more than any other sector this year. And 58% of that has gone to Democrats, marking a change, perhaps, in political strategy. Not since the 1990 election cycle have finance, insurance and real estate companies given more than 52% of overall donations to Democrats, and from 1991 to 2006 finance gave the majority of its money to Republicans. %u2028

U.S. Schools Are More Segregated Today Than in the 1950s

Schools in the United States are more segregated today than they have been in more than four decades. Millions of non-white students are locked into “dropout factory” high schools, where huge percentages do not graduate, and few are well prepared for college or a future in the U.S. economy.

According to a new civil rights report published at the University of California, Los Angeles (UCLA), minorities are rapidly emerging as the majority of public school students in the United States. But Latinos and blacks, the two largest minority groups, attend schools more segregated today than during the civil rights movement 40 years ago. In Latino and African-American populations, two of every five students attend intensely segregated schools.

Unequal education leads to diminished access to college and future jobs. Most non-white schools are segregated by poverty as well as race. Most of the nation’s dropouts occur in non-white public schools, leading to large numbers of virtually unemployable young people of color.

Schools in low-income communities remain highly unequal in terms of funding, qualified teachers and curriculum. The report indicates that schools with high levels of poverty have weaker staffs, fewer high-achieving peers, health and nutrition problems, residential instability, more single-parent households, high exposure to crime and gangs, and many other conditions that strongly affect student performance levels. Low-income campuses are more likely to be ignored by college and job recruiters.

Our nation’s segregated schools result from decades of systematic neglect of civil rights policy and related educational and community reforms. According to the UCLA report, we need leaders who recognize these problems and will work toward an America where our children grow up together, knowing and respecting each other, and are all given the educational tools that prepare them for success in society.

Bailed-Out Banks and America’s Wealthiest Cheat IRS Out of Billions

A 2008 study done by the Government Accountability Office (GAO) reported that 83 of the top publicly held U.S. companies have operations in tax havens like the Cayman Islands, Bermuda and the Virgin Islands. Fourteen of these companies, including AIG, Bank of America and Citigroup, received money from the government bailout. The GAO also reported that activities of Union Bank of Switzerland (UBS) are directly connected to tax avoidance.

Swiss banking giant UBS has enabled wealthy Americans to use tax schemes—some of which are illegal—to cheat the IRS out of more than $20 billion in recent years, according to the U.S. Department of Justice (DOJ).

For corporations, the process of geographic tax avoidance is fairly simple. A U.S. corporation will sell products at reduced rates, even a loss, to their own offshore subsidiaries, and then resell the products at higher prices, paying little or no taxes in the foreign country.

In December 2008, the bank holding company Goldman Sachs reported its first quarterly loss. On the heels of this announcement, Goldman Sachs issued a statement confirming that its tax rate was dropping from 34.1% to 1%. Goldman Sachs Group Inc., which received $10 billion and debt guarantees from the government in October 2008, expects to pay only $14 million in taxes worldwide for 2008, compared with $6 billion in 2007. The New York-based Goldman Sachs cited “changes in geographic earnings mix” as the reason behind the decrease. %u2028

On Feb. 19, 2009, UBS for the first time agreed to release to the DOJ an as yet undetermined number of the names of bank account holders.

Katrina’s Hidden Race War

A shocking report in The Nation exposes how white vigilante groups patrolled the streets of New Orleans after Hurricane Katrina, shooting at least 11 African-American men.

While most of New Orleans was deluged in the wake of Katrina, word spread that Algiers Point was dry. The National Guard designated the Algiers Point ferry landing an official evacuation site, where flood victims were to be loaded onto buses headed for safety in Texas. Facing an influx of refugees, a group of heavily armed white residents sought to seal the area and to rid the neighborhood of “those who didn’t belong.” As the government collapsed, the city fractured along racial lines. Algiers Point is largely white, while the rest of Algiers is predominantly black. Desperate people began heading toward the west bank, some walking over bridges, others traveling by boat.

The media often portrayed the city’s African Americans as looters and thugs, but it appears that the most serious crimes were committed by gun-toting white males. While white vigilantes killed an estimated 11 African-American victims, local police have never conducted investigations. So far, the crimes have gone unpunished.

Democracy Now! footage shows that dead bodies were left, sometimes for weeks, to rot in full view of Homeland Security, state troopers, Army personnel, private security guards and police who “secured” the streets of New Orleans in the aftermath of Katrina.

Bank Bailout Recipients Spent to Defeat Labor

On Oct. 17, 2008, three days after Bank of America received $25 billion in federal bailout funds, they hosted a conference call to organize opposition to the Employee Free Choice Act (EFCA). Participants, including AIG, were urged to persuade their clients to send “large contributions” to groups working against the EFCA, as well as to Senate Republicans who could be used to help block passage of the bill, which would make it easier for employees to organize into unions.

Bernie Marcus, co-founder of Home Depot, and Rick Berman, founder of the Center for Union Facts, led the hour-long phone call that framed the legislation as a threat to American capitalism. The legislation is virtually certain to face a Republican filibuster, while Obama and Senate Democrats have stated their commitment to the bill.

Donations of hundreds of thousands, if not millions, of dollars were needed, it was argued, to prevent America from turning “into France.”

“If a retailer has not gotten involved in this, if he has not spent money on this election, if he has not sent money to [former Sen.] Norm Coleman and all these other guys, they should be shot. They should be thrown out of their goddamn jobs,” Marcus declared. %u2028

According to author Sam Stein, reform groups are urging an investigation into whether bailout recipients used taxpayer money to benefit political candidates or organizations.

Berman said that there “was nothing on that call that spoke to funneling money to anybody.” Either way, Bank of America did use time and resources to host the anti-EFCA forum, on which individuals were urged to make political donations. That alone has compelled groups advocating government reform to raise concerns with Congress.

Activists Slam World Water Forum as a Corporate-Driven Fraud

Water rights activists blasted the World Water Forum, held in Turkey in March 2009, as a corporate trade show promoting privatization of water. Three hundred Turkish activists gathered near the forum’s entrance and were faced with the overwhelming force of between 2,000 and 3,000 police. The forum opened with Turkish police firing tear gas and detaining protesters, who were shouting “Water for life, not for profit.”

According to its Web site, the World Water Forum is “an open, all-inclusive, multi-stakeholder process” where governments, NGOs, businesses and others “can link up, debate and attempt to find solutions to achieve water security.”

However, the forum’s main organizer, the World Water Council (WWC), is dominated by two of the world’s largest private water corporations, Suez and Veolia. Critics contend that the council’s links to Suez and Veolia, as well as the large representation of the business industry in the WWC, compromise its legitimacy. Corporate interests that make up the World Water Council are in constant contact with the World Bank and other financial institutions. Each World Water Forum is set up as a quasi-United Nations event, to the extent of issuing a Ministerial Statement at the forum’s close promoting global policy approaches to water and sanitation.

The WWC promotes extraordinarily expensive and destructive dam and water diversion projects as well as policies such as public-private partnerships (PPPs) that put water services under private ownership. PPPs in Argentina, Bolivia, El Salvador, the United States and other countries have resulted in huge price hikes, as well as water pollution, depletion and cut-offs that, in the language of the water justice movement, “deny people the right to water.”

Despite these and other harmful impacts, the Istanbul Water Consensus aims to secure the commitment of local authorities to similar water policies.

This year’s forum issued a communiqué that describes access to water as a “basic human need” rather than a “human right,” despite efforts by dissenting Latin American countries, France and Spain to introduce the right to water. They were reportedly blocked by Egypt, Brazil and the United States. In the minutiae of political verbiage, this apparently slight difference in terminology can have a profound significance. If water is defined as a “need” rather than a “right,” it becomes a commodity subject to trade and implies no obligation on the parts of governments to ensure access to it. If it is a human right, on the other hand, mandatory government policy is activated to assure unconditional access to everyone.

Congress Invested in Defense Contracts

The nonpartisan Center for Responsive Politics has calculated that more than 151 members of Congress have up to $195 million invested in major defense contractors that are earning profits from the U.S. military occupations in Iraq and Afghanistan.

In 2006, the investment portfolios of 151 current members—more than a quarter of Congress—had between $78.7 million and $195.5 million invested in companies that received major defense contracts (more than $5 million). The portfolios include holdings in companies paid billions of dollars each month to support America’s military. These companies provide almost everything the military uses, from aircraft and weapons to medical supplies and soft drinks.

Lawmakers with the most money invested in companies with Department of Defense contracts include Rep. Rodney Frelinghuysen (R-N.J.), with $49 million; Sen. John Kerry (D-Mass.), with up to $38 million; Rep. Robin Hayes (R-N.C.), with $37 million; Rep. James Sensenbrenner Jr. (R-Wis.), with $7.6 million; Rep. Jane Harman (D-Calif.), with $6.26 million; Rep. Fred Upton (R-Mich.), with $8.36 million; Sen. Jay Rockefeller (D-W.Va.), with $2 million; Rep. Tom Petri (R-Wis.), with $5.8 million; Rep. Kenny Ewell Marchant (R-Texas), with $1.16 million; and Rep. John Carter (R-Texas), with up to $5 million.

Companies with congressional investors received more than $275.6 billion from the government in 2006. The minimum value of Congress members’ personal investments in defense contracting firms increased 5% from 2004 to 2006, but because lawmakers are only required to report their assets in broad ranges, the value of these investments could have risen as much as 160%—or even dropped 51%.

Kerry and Sensenbrenner, two of Congress’ wealthiest members, were among the lawmakers who earned the most from their investments in defense contractors between 2004 and 2006, with Sensenbrenner making at least $3.2 million and Kerry reaping at least $2.6 million.

A spokesman for Sensenbrenner, who supported the Bush administration’s policies in Iraq, said the congressman’s stocks were left to him by his grandparents and are managed almost entirely by his investment advisers. Kerry, who had been particularly outspoken against the Bush administration’s strategy and policies in Iraq, is a beneficiary of family trusts, which he doesn’t control, the senator’s spokesman said.

Excerpted from Censored 2010: The Top 25 Censored Stories of 2008-09, edited by Peter Phillips and Mickey Huff with Project Censored.

Here’s the full list of underreported stories of the year. To read about them, go to www.projectcensored.org
  • Congress Sells Out to Wall Street
  • U.S. Schools Are More Segregated Today Than in the 1950s
  • Toxic Waste Behind Somali Pirates
  • Nuclear Waste Pools in North Carolina
  • Europe Blocks U.S. Toxic Products
  • Lobbyists Buy Congress
  • Obama’s Military Appointments Have Corrupt Past
  • Bailed-Out Banks and America’s Wealthiest Cheat IRS Out of Billions
  • U.S. Arms Used for War Crimes in Gaza
  • Ecuador Declares Foreign Debt Illegitimate
  • Private Corporations Profit from the Occupation of Palestine
  • Mysterious Death of Mike Connell, Karl Rove’s Election Thief
  • Katrina’s Hidden Race War
  • Congress Invested in Defense Contracts
  • World Bank’s Carbon Trade Fiasco
  • U.S. Repression of Haiti Continues
  • The ICC Facilitates U.S. Covert War in Sudan
  • Ecuador’s Constitutional Rights of Nature
  • Bank Bailout Recipients Spent to Defeat Labor
  • Secret Control of the Presidential Debates
  • Recession Causes States to Cut Welfare
  • Obama’s Trilateral Commission Team
  • Activists Slam World Water Forum as a Corporate-Driven Fraud
  • Dollar Glut Finances U.S. Military Expansion
  • Fast-Track Oil Exploitation in Western Amazon


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