The very top of Florida Politics’ reading recommendations was this Bloomberg article, or at least its excerpts in the Pensacola blog, wherein “Beach Blogger” concluded of our former governor:
“It’s past time for Mr. Jeb Bush to disclose the details of his contract with Lehman brothers.”
For starters, Do I hear any Democrats demanding it?
Actually, there’s not much about Jeb in the Bloomberg piece, though as a critic says therein:
“Bush is a consultant to the company selling bad investments to the same agency on which he served as a trustee until January.”
Before launching deeper into a Bushian broadside, let’s step back. We’re talking about a fiasco that ripped some $2 billion out of the pockets of Florida taxpayers, and it’s hardly making a ripple. Maybe it’s my fault. I haven’t posted on this since Dec. 3 when my headline announced “Florida’s financial crisis.” The news then was a run on the equivalent of a Florida state money-market fund. Call that Chapter One of my meager attempt to foment rebellion.
Now in Chapter Two we have a lot more detail provided in the Bloomberg piece, also in the Miami Herald and maybe other outlets around the state.
Has anyone heard of this on TV, where most folks get their news? Probably not, no good video – until we get to the boarded-up schools and laid-off firemen. These are possible casualties down the line as local government agencies find they can’t get money they put on deposit with the governor.
Essentially, that’s the deal here: depositing your tax revenues with the governor until you need to write checks to pay your staff and bills. Banks aren’t good enough, you see. They don’t pay high-enough interest. The governor knows this guy, you see, who will give higher rates. And don’t ask about the risk.
Well, thank goodness they didn’t put all their – our – money in the subprime swamp.
Getting back to the kernel of Chapter Two: The problem for the governor is that folks didn't have to be financial insiders to be aware that subprime lenders were in trouble. Many months ago all it took was occasional glances at the headlines to see that they needed ever greater infusions of capital. If I’d had any spare money to invest earlier this year, I would have gone 180 degrees away from subprime lenders. No sir, those guys are in bad shape. But the governor kept on buying. And then bought some more. And more and more.
Of course, it wasn’t the governor alone. He and the attorney general and our top Democratic elected official in Florida, Chief Financial Officer Alex Sink, make up the board that oversees the “state bank.” Until the run on the bank erupted in late November, they were advised by a former crony of Jeb’s, Coleman Stipanovich, with the title of executive director and a salary reported as $180,214 in 2006. Stipanovich was fired soon after the run forced closure of the fund.
In the Bloomberg article, Alex Sink explained why: The CFO thought that Stipanovich was getting independent advice from the big Lehman Brothers investment bank, when in fact Lehman Brothers was selling (unloading) dubious debt to Florida’s unsuspecting taxpayers.
We with suspicious minds may ask: Did Jeb Bush, in his role as consultant to Lehman Brothers, have any role in all this? Helping those paying him an undisclosed amount (Lehman) sell dubious debt to Florida taxpayers through a crony (Stipanovich)?
Bloomberg and the Miami Herald report Jeb’s not commenting.
In this corner, that’s not good enough. Nor is it satisfying to see Jeb’s big brother George W. in the paper today contorting his face when asked about those destroyed CIA videos of (probably) torture. “Let’s wait and see … no opinion from the podium.”
Disgusting stonewalling.
FOOTNOTE: The Bloomberg article reports that the “state bank” managed $184 billion. That’s about two years of the state budget, isn’t it? I know there are pension funds in there and all that, but isn’t it a lot of money to be stashed away with little public oversight? Call that a memo to anyone running for state legislature.
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