For the week of November 5 - 11, 2003

Chicken senators and four-flushing financiers

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On Monday, the same U.S. Senate that conducted a critical vote with most of its members hiding out in their offices was the same Senate that was holding hearings and expressing outrage over the discovery that mutual fund companies had enriched special investors in backroom deals.

In the Senate vote, Republicans and Democrats agreed to avoid a roll-call vote in favor of a voice vote on a bill to allocate $87 billion for military operations and rebuilding in Iraq.

Why? Election-year politics.

Some senators feared the wrath of constituents for increasing the federal deficit. Other senators feared the wrath of constituents for not supporting our troops in Iraq. What were the good senators to do?

They hid. Only a handful of senators even bothered to show up for the voice vote that put the nation farther into serious deficit territory—with no roadmap out.

No voter in America will ever be sure who voted up or down to go deeper into red ink. The sole admirable exception was Sen. Robert Byrd of West Virginia who conspicuously shouted his "Nay" during the vote. Agree or disagree, everyone knows how he voted.

It’s tempting to shrug off the vote as politics as usual, but it was the worst form of self-serving politics. To protect themselves, they deprived voters of debate and stole their ability to make choices based on voting records.

The senators should be ashamed of their cowardice. American soldiers are killed daily in Iraq. Yet, the U.S. senators didn’t have the guts to go on record in a controversial vote? The senators only risked losing an election, not their lives.

Given that the nation’s best and brightest prefer the backroom to the Senate floor, is it any wonder that Wall Street’s best seem to prefer it as well?

The Securities and Exchange Commission investigation of major investment companies for violating prohibitions on after-hours trading is sending seismic waves through famous investment houses. New York Attorney General Eliot Spitzer, whose investigations forced the probe, said after-hours trading is like betting on a horse race—after it’s finished.

The practice cheated trusting everyday investors—urged by their president, their financial advisors and their employers to invest for retirement and their children’s futures—out of billions of dollars while lining the pockets of a connected few. Industry insiders allege that the practice was an open secret on Wall Street.

Chicken senators. Four-flushing financial barons. Red ink engulfing the federal government. Cracks in the integrity of the nation’s investment houses. The Middle East looking like quicksand more each day.

The nation needs more people like Eliot Spitzer and Robert Byrd who are willing to face the facts and face down the powerful—without flinching.

 

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