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Archive for the ‘Obama administration’ Category

White House Official Cozied Up to Google Before Antitrust Lawsuit Was Shelved

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David Dayen reports in The Intercept:

When the Federal Trade Commission neared a momentous decision on whether to charge Google with violating antitrust laws in January 2013, the White House was watching closely.

New emails uncovered by the Campaign for Accountability, a public interest watchdog organization, show that a White House advisor met with top Google lobbyist Johanna Shelton and top Google antitrust counsel Matthew Bye twice in the weeks before the FTC announcement.

And minutes prior to the final decision – in which FTC commissioners took the unusual step of overriding their staff’s recommendation to sue, and voted to settle the case instead – the White House official even sought Google’s talking points in the matter.

The FTC is an independent agency within the executive branch. As with the Justice Department, the White House political staff is prohibited from contacting federal regulators who might bring a formal case on behalf of the government. And ever since Richard Nixon stifled the antitrust investigation into ITT, a major donor, White House interference in antitrust cases has been particularly forbidden.

When Donald Trump threatened to bring up Amazon on antitrust charges because he was getting bad press from the Washington Post, owned by Amazon founder Jeff Bezos, it was correctly seen as chilling.

The revelation about the White House’s contacts with Google prior to the FTC decision is another example of the extraordinarily close relationship between Google and the Obama White House. In April, the Campaign for Accountability found — and The Intercept published — evidence from the White House’s own records of frequent meetings between Google staff and Obama administration personnel – over one a week since the beginning of his presidency – and spins through the revolving door between Google and the U.S. government. Nearly 250 people have shuttled from government service to Google employment or vice versa over the course of Obama’s tenure.

This close contact, as well as Google’s partnership with the executive branch on a host of projects, almost inevitably breeds a camaraderie that is at odds with the ability of the government to actually regulate a private company. The West Wing’s coziness with Google officials prior to the antitrust decision speaks to that.

At the time, the FTC was looking into allegations that Google harmed Internet customers and its rivals by prioritizing its own companies and affiliates in search engine results and its placement of online advertising on its search sites. The staff of the Bureau of Competition at the FTC recommended suing after concluding that Google engaged in anticompetitive conduct that “has resulted – and will result – in real harm to consumers and to innovation.” . . .

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Written by LeisureGuy

18 August 2016 at 2:00 pm

A step in the right direction: Justice Department says it will end use of private prisons

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Private enterprise is not the answer to everything, and in particular government services and functions are inappropriate as a means of generating revenues and profits: government is not a profit-making enterprise nor, given its power and control, should it be.

Matt Zapotosky reports in the Washington Post:

The Justice Department plans to end its use of private prisons after officials concluded the facilities are both less safe and less effective at providing correctional services than those run by the government.

Deputy Attorney General Sally Yates announced the decision on Thursday in a memo that instructs officials to either decline to renew the contracts for private prison operators when they expire or “substantially reduce” the contracts’ scope. The goal, Yates wrote, is “reducing — and ultimately ending — our use of privately operated prisons.”

“They simply do not provide the same level of correctional services, programs, and resources; they do not save substantially on costs; and as noted in a recent report by the Department’s Office of Inspector General, they do not maintain the same level of safety and security,” Yates wrote.

In an interview, Yates said there are 13 privately run privately run facilities in the Bureau of Prisons system, and they will not close overnight. Yates said the Justice Department would not terminate existing contracts but instead review those that come up for renewal. She said all the contracts would come up for renewal over the next five years.

The Justice Department’s inspector general last week released a critical report concluding that privately operated facilities incurred more safety and security incidents than those run by the federal Bureau of Prisons. The private facilities, for example, had higher rates of assaults — both by inmates on other inmates and by inmates on staff — and had eight times as many contraband cellphones confiscated each year on average, according to the report.

Disturbances in the facilities, the report said, led in recent years to “extensive property damage, bodily injury, and the death of a Correctional Officer.” The report listed several examples of mayhem at private facilities, including a May 2012 riot at the Adams County Correctional Center in Mississippi in which 20 people were injured and a correctional officer killed. That incident, according to the report, involved 250 inmates who were upset about low-quality food and medical care.

“The fact of the matter is that private prisons don’t compare favorably to Bureau of Prisons facilities in terms of safety or security or services, and now with the decline in the federal prison population, we have both the opportunity and the responsibility to do something about that,” Yates said. . .

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UPDATE: In The Intercept: “The Justice Department is done with private prisons. Will ICE drop them, too?

Written by LeisureGuy

18 August 2016 at 11:52 am

Cow Most Sacred: Why Military Spending Remains Untouchable

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Andrew Bacevich wrote a good column five years ago—and it was posted again today by TomDispatch.com, which noted that nothing has changed and the column is as relevant as ever. A good part of the reason is that Congress no longer does its job. Bacevich begins:

In defense circles, “cutting” the Pentagon budget has once again become a topic of conversation.  Americans should not confuse that talk with reality. Any cuts exacted will at most reduce the rate of growth.  The essential facts remain: U.S. military outlays today equal that of every other nation on the planet combined, a situation without precedent in modern history.

The Pentagon presently spends more in constant dollars than it did at any time during the Cold War — this despite the absence of anything remotely approximating what national security experts like to call a “peer competitor.”  Evil Empire?  It exists only in the fevered imaginations of those who quiver at the prospect of China adding a rust-bucket Russian aircraft carrier to its fleet or who take seriously the ravings of radical Islamists promising from deep inside their caves to unite the Umma in a new caliphate.

What are Americans getting for their money?  Sadly, not much.  Despite extraordinary expenditures (not to mention exertions and sacrifices by U.S. forces), the return on investment is, to be generous, unimpressive.  The chief lesson to emerge from the battlefields of the post-9/11 era is this: the Pentagon possesses next to no ability to translate “military supremacy” into meaningful victory.

Washington knows how to start wars and how to prolong them, but is clueless when it comes to ending them.  Iraq, the latest addition to the roster of America’s forgotten wars, stands as exhibit A.  Each bomb that blows up in Baghdad or some other Iraqi city, splattering blood all over the streets, testifies to the manifest absurdity of judging “the surge” as the epic feat of arms celebrated by the Petraeus lobby.

The problems are strategic as well as operational.  Old Cold War-era expectations that projecting U.S. power will enhance American clout and standing no longer apply, especially in the Islamic world.  There, American military activities are instead fostering instability and inciting anti-Americanism.  For Exhibit B, see the deepening morass that Washington refers to as AfPak or the Afghanistan-Pakistan theater of operations.

Add to that the mountain of evidence showing that Pentagon, Inc. is a miserably managed enterprise: hide-bound, bloated, slow-moving, and prone to wasting resources on a prodigious scale — nowhere more so than in weapons procurement and the outsourcing of previously military functions to “contractors.”  When it comes to national security, effectiveness (what works) should rightly take precedence over efficiency (at what cost?) as the overriding measure of merit.  Yet beyond a certain level, inefficiency undermines effectiveness, with the Pentagon stubbornly and habitually exceeding that level.  By comparison, Detroit’s much-maligned Big Three offer models of well-run enterprises.

Impregnable Defenses

All of this takes place against the backdrop of mounting problems at home: stubbornly high unemployment, trillion-dollar federal deficits, massive and mounting debt, and domestic needs like education, infrastructure, and employment crying out for attention.

Yet the defense budget — a misnomer since for Pentagon, Inc. defense per se figures as an afterthought — remains a sacred cow.  Why is that?

The answer lies first in understanding the defenses arrayed around that cow to ensure that it remains untouched and untouchable.  Exemplifying what the military likes to call a “defense in depth,” that protective shield consists of four distinct but mutually supporting layers.

Institutional Self-Interest: Victory in World War II produced not peace, but an atmosphere of permanent national security crisis.  As never before in U.S. history, threats to the nation’s existence seemed omnipresent, an attitude first born in the late 1940s that still persists today.  In Washington, fear — partly genuine, partly contrived — triggered a powerful response.

One result was the emergence of the national security state, an array of institutions that depended on (and therefore strove to perpetuate) this atmosphere of crisis to justify their existence, status, prerogatives, and budgetary claims.  In addition, a permanent arms industry arose, which soon became a major source of jobs and corporate profits.  Politicians of both parties were quick to identify the advantages of aligning with this “military-industrial complex,” as President Eisenhower described it.

Allied with (and feeding off of) this vast apparatus that transformed tax dollars into appropriations, corporate profits, campaign contributions, and votes was an intellectual axis of sorts  — government-supported laboratories, university research institutes, publications, think tanks, and lobbying firms (many staffed by former or would-be senior officials) — devoted to identifying (or conjuring up) ostensible national security challenges and alarms, always assumed to be serious and getting worse, and then devising responses to them.

The upshot: within Washington, the voices carrying weight in any national security “debate” all share a predisposition for sustaining very high levels of military spending for reasons having increasingly little to do with the well-being of the country.

Strategic Inertia: . . .

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Written by LeisureGuy

18 August 2016 at 11:19 am

Why Is Aetna Pulling Out of Nice, Profitable Pennsylvania?

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Kevin Drum points out that Aetna’s withdrawing from the Obamacare health exchanges is almost certainly a vengeful act because their merger with Humana was approved. Drum posts:

Last night I linked to a letter from Aetna to the Department of Justice explaining what they would do if their merger with Humana wasn’t approved. The answer, basically, was that they’d pull out of a bunch of Obamacare exchanges. As insurance pro Richard Mayhew puts it:

TLDR: Nice exchanges there, be a pity if anything happened.

But Mayhew points out something else. Aetna claims that they’re not really threatening the Obama administration. They’re losing money! If the merger isn’t approved, they really have no choice but to pull back from the exchanges. It’s sad, but what are you gonna do?

And yet—in 2015 they made $13.6 million in the individual market in Pennsylvania. That’s a very healthy 19 percent of premium revenue. But one of the states they’re pulling back from is…Pennsylvania. Nice, profitable, Democratic-leaning Pennsylvania. It’s very peculiar, isn’t it?

Written by LeisureGuy

18 August 2016 at 8:59 am

Former NSA Staffers: Rogue Insider Could Be Behind NSA Data Dump

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UPDATE: One clue: the poor use of English in the messages seems to be faked. /update

That the NSA data dump could have come from a disgruntled employee seems not at all unlikely, given Edward Snowden. Lorenzo Franceschi-Bicchierai and Joseph Cox report in Motherboard:

There are a lot of unanswered questions surrounding the shocking dump of a slew ofhacking tools used by an NSA-linked group earlier this week. But perhaps the biggest one is: who’s behind the leak? Who is behind the mysterious moniker “The Shadow Brokers”?

So far, there’s no clear evidence pointing in any direction, but given the timing of the leak, and the simple fact that very few would have the capabilities and the motives to hack and shame the NSA publicly, some posited The Shadow Brokers could be Russian.

But there’s another possibility. An insider could have stolen them directly from the NSA, in a similar fashion to how former NSA contractor Edward Snowden stole an untold number of the spy agency’s top secret documents. And this theory is being pushed by someone who claims to be, himself, a former NSA insider.

“My colleagues and I are fairly certain that this was no hack, or group for that matter,” the former NSA employee told Motherboard. “This ‘Shadow Brokers’ character is one guy, an insider employee.”

The source, who asked to remain anonymous, said that it’d be much easier for an insider to obtain the data that The Shadow Brokers put online rather than someone else, even Russia, remotely stealing it. He argued that “naming convention of the file directories, as well as some of the scripts in the dump are only accessible internally,” and that “there is no reason” for those files to be on a server someone could hack. He claimed that these sorts of files are on a physically separated network that doesn’t touch the internet; an air-gap. (Motherboard was not able to independently verify this claim, and it’s worth bearing in mind that an air-gap is not an insurmountable obstacle in the world of hacking).

Of course, as Matt Suiche, the CEO of Dubai-based cybersecurity company Comae,noted in a post analyzing the insider theory, a leading theory is . . .

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Written by LeisureGuy

18 August 2016 at 8:53 am

Why can’t the SEC do its job? The NeuroMama case.

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Pam Martens and Russ Martens report in Wall Street on Parade:

A dubious search engine company trading over-the-counter on Wall Street, with a felon as a “General Design and Marketing Strategist” who was banned from the industry for previous stock frauds, and with the craziest SEC filings and disclosure documents you’ll ever read in your lifetime, was finallyhalted from trading yesterday by the SEC – but only after reaching a market value of $35 billion.

The SEC said in its announcement of the trading halt of the company, NeuroMama, Ltd., Inc., that it had “concerns” about “the identity of the persons in control of the company’s operations and management, false statements to company shareholders and/or potential investors that the company has an application pending for listing on the NASDAQ Stock Market, and potentially manipulative transactions in the company’s stock.”

Yesterday’s SEC statement simply does not do justice to the insanity of what has been going on under its nose while it was engaging in a polite letter-writing campaign with the company in a futile attempt to obtain granular operational details.

The SEC had plenty of warnings that things were amiss at NeuroMama. On September 2, 2014, Edward Schneider, a Certified Financial Analyst, reported at Seeking Alpha that NeuroMama’s General Design and Marketing Strategist (which sounds a lot like a stock promoter to Wall Street veterans) was Vladislav Steven Zubkis, who had previously been barred by the SEC from association with any broker or dealer or offering of penny stocks because of his past schemes that “generated more than $12 million in illegal proceeds.” A bizarre disclosure on NeuroMama’s web site takes the reader through a 68-page narrative of how Zubkis is now on a charitable mission for children, to the eventual disclosure that subsequent to his bar by the SEC, Zubkis went to prison for five years. Zubkis’s take on why he went to prison is far different than what prosecutors alleged at the time.

In 2005, Zubkis was arraigned on charges that he defrauded investors out of more than $1.8 million during 2003 and 2004 over a promised construction of a storage facility and purchase of an ownership interest in a Las Vegas casino, according to the San Diego Union Tribune at the time. The newspaper quoted the prosecutor in the case, Assistant U.S. Attorney Sanjay Bhandari, calling Zubkis a “professional, hard-boiled con man” who moved from one bogus scheme to another.

A June 13, 2013 company filing with the SEC by NeuroMama was an equally glaring red flag. The filing used hyperbolic words like . . .

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Written by LeisureGuy

16 August 2016 at 9:56 am

As ISIS Brewed in Iraq, the White House and Congress Cut Eyes and Ears on the Ground

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Jeff Gerth and Joby Warrick report in ProPublica:

A week before the last U.S. soldiers left his country in December 2011, Iraqi Prime Minister Nouri al-Maliki traveled to Washington to meet the team that would help shape Iraq’s future once the troops and tanks were gone.

Over dinner at the Blair House, guest quarters for elite White House visitors since the 1940s, the dour Iraqi sipped tea while Secretary of State Hillary Rodham Clinton spoke of how her department’s civilian experts could help Iraqis avoid a return to terrorism and sectarian bloodshed.

Iraq would see a “robust civilian presence,” Clinton told reporters afterward, summing up the Obama administration’s pledges to Maliki. “We are working to achieve that,” she said.

Less than three years later, the relatively calm Iraq that Maliki had led in 2011 was gone. The country’s government was in crisis, its U.S.-trained army humiliated, and a third of its territory overrun by fighters from the Islamic State. Meanwhile, State Department programs aimed at helping Iraqis prevent such an outcome had been slashed or curtailed, and some had never materialized at all.

Clinton’s political foes would later seek to blame her, together with President Obama, for the Islamic State’s stunning takeover of western Iraq, saying the State Department failed to preserve fragile security gains achieved at great cost by U.S. troops. Republican presidential nominee Donald Trump last week asserted that Obama “founded” the Islamic State and that Clinton was “the most valuable player” in the group’s creation. Trump later contended that he was being sarcastic.

But an intensive review of the record during Clinton’s tenure presents a broader picture of missteps and miscalculations by multiple actors — including her State Department as well as the Maliki government, the White House and Congress — that left Iraqi security forces weakened and vulnerable to the Islamic State’s 2014 surge.

Documents and interviews point to ambitious plans by State Department officials to take control of dozens of military-run programs in Iraq, from training assistance for Iraqi police to new intelligence-collection outposts in Mosul and other key Iraqi cities. But the State Department scrapped or truncated many of the plans, sometimes at the behest of a skeptical Congress and other times on orders from the White House, which balked at the high costs and potential risks of U.S. civilians being killed or kidnapped. Still other efforts were thwarted by a Maliki government that viewed many of the programs as an unwelcome intrusion in Iraqi affairs.

Senior State Department leaders were at fault as well, according to documents and interviews with officials who helped manage Iraqi aid programs after the withdrawal. By early 2012, pressed by the White House to reduce the U.S. civilian footprint in Iraq, the department had begun implementing sweeping, across-the-board cuts that extended to security and counterterrorism initiatives once considered crucial for Iraq’s stability after the withdrawal of U.S. troops, a joint investigation by ProPublica and The Washington Post found. . .

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Written by LeisureGuy

15 August 2016 at 2:05 pm

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