Saturday, October 14, 2006

Money makes the man - How do Congressmen invest their monies?

When Money Speaks, the Truth is Silent ... old Russian proverb.

Mark Kennedy came out swinging at Amy Klobuchar during the State Fair debate over her investments in Big Oil and Pharmaceutical companies. This was just one of many stupid campaign foibles that Kennedy has tried. Yes, Klobuchar does have investments … through her retirement fund … which she does not have any control over how the fund manager invests her (and thousand of others') payroll contributions.

But now, OpenSecrets.org has Federal employees' personal financial disclosure forms online. Lo and behold, upon checking Congressman Kennedy, we find his largest publicly traded asset is a mutual fund – Fidelity Spartan 500 Index. Anybody want to guess the number one asset in that fund? Can you say ExxonMobil ? Based on the fact that 3.21 % of the fund’s assets are in XOM, Kennedy owns somewhere between $3,210 and $6,420 of ExxonMobil. Now, I don’t think that Kennedy would be influenced by such a paltry amount, yet he’s attacking Klobuchar who has less control than he does. Remember, Klobuchar’s monies are in a retirement fund … Kennedy’s is in his personal portfolio. In theory, Kennedy could decide to buy/sell the mutual fund based on the fund’s objectives and portfolio.

It should be recognized that Kennedy’s portfolio is currently entirely invested in mutual funds. Using mutual funds minimizes any potential influence.


However, when I checked Gil Gutknecht’s form, I have some concerns. He does invest directly in companies. His largest holdings are in BellSouth and Fastenal. Both of these companies are Fortune 500 companies.


Fastenal is a Winona based company and one that has seen its share price double in the past five years. Fastenal’s primary business is nuts and bolts and other MRO items. There is probably little direct legislative action that Fastenal’s business would need the influence of a Congressman. Back in the late 90’s Congress enacted legislation when it was concerned about the quality of foreign produced fasteners and required testing laboratories be used. DCAA (government inspectors) pay a lot of attention to nuts and bolts in a manufactured product … stresses impact performance and if the product is used in a space shuttle, Navy ship, etc, lives could be at stake. Based on Fastenal’s standing as an employer in the First District, I would think that they would get pretty easy access to the Congressman, regardless of him being a stockholder. Yet, it does not look good. With an investment of over $30,000, the how, when and why Gutknecht bought the stock should be disclosed.



BellSouth is a name that most would know since it was created by the government break-up of American Telephone and Telegraph Company. With Gutknecht's stock investment value at over $50,000, this IS a concern. Historically, investing in telephone companies was considered a safe investment for retirement, but with today’s everchanging technologies, that is not the same environment. Most troubling is that Gutknecht is the Telecommunications Task Force Co-Chairman. In his June 23, 2006 eline, he trumpeted the House passage of HR 5252 which changes the rules of how the Internet operates and allows telephone companies to charge fees and determine what information is made available. Despite appeals by such groups as Christian Coalition of America and Gun Owners of America, Gutknecht listened to the telecommunications industry and the reaction from the telecommunications industry was quick. BellSouth immediately announced a change in policy to charge user fees, even though the bill had not been passed by the Senate. Reaction from customers was swift and on August 25, it rescinded the user fee charge … but the point is that BellSouth tried, and who knows if the Senate had passed the bill, if they would have rescinded the fee charge.

Additionally, BellSouth Corp through their Political Action Committee gave Gutknecht $1,000 for his 2006 primary campaign. (LOL … for his primary campaign???? … did anyone think that Greg Mikkelson was going to beat Gutknecht???).


When a politician has earned his monies from family businesses or personal involvement, I can understand the reluctance to divest those monies. But a politician should avoid - at all costs - making investments in individual stocks. Senators Bill Frist and George Allen have been in the headlines based on how they have handled Blind Trusts. If I were an elected official, I would only use large mutual funds.



Kennedy’s Personal Disclosure Form

http://www.opensecrets.org/pfds/CIDsummary.asp?CID=N00009670&year=2005

Gutknecht’s Personal Disclosure Form

http://www.opensecrets.org/pfds/CIDsummary.asp?CID=N00004527&year=2005

Tuesday, October 10, 2006

Congressman Boehner, welcome to Mankato ... got time for a few questions?

When was the last time that Gil Gutknecht resorted to having outsiders campaign for him ?

When Newt Gingrich came to the First District, it was fair to ask who was doing the campaigning. Gingrich won the MN Republican Presidential straw poll at their convention, so he may have been motivated to meet, greet and grab favors for a 2008 run.

But Republican Majority Leader Boehner? I do not see a strong ideological relationship between Gutknecht and Boehner. The reality is that Gutknecht is a back bencher holding a seat as a RoveRobot. In his 12 year performance, he has no personal legislative accomplishments and no national prominence. Essentially, he is campaign for a lifetime appointment as a back bencher who takes the people’s paycheck to support corporate and party interests.
It is unknown who Gutknecht supported as DeLay’s replacement but based on his voting record, I suspect that he was more akin to ultra- conservative Rep. John Shadegg of Arizona than Boehner. When the party did break down and individuals voted their conscience, Gutknecht and Boehner did not always vote the same way.
Most interesting to me is the site of the meeting – Mankato State University. Boehner, was a prominent member of the Agriculture Committee, and I would have thought Austin or Blue Earth may have made more sense to appeal to the farm interests.

But that all stated, I do have a few questions for John Boehner and Gil Gutknecht.

Rule of Law
The President has expressed a belief that legislation is needed to reform the legal system so that it delivers swift justice for real victims of wrongdoing instead of enriching an elite class of lawyers. Would you comment on these areas where it appears there has been an effort to ignore contractual responsibilities and if legal action is warranted?

1. Both of you were proud endorsers of the Contract With America. One of the provisions was for term limits. You are both campaigning now to violate your commitment to that concept. If you could not get what needed to be accomplished during the past twelve years, why didn’t you give others in your party a chance?

2. Military families have experienced the emotional trauma of deployment on an unprecedented scale. These long separations are of increasing concern with two-thirds of soldiers now married and deployments to the Afghanistan / Iraq theatre entering a fifth year. About 3,500 troops with the Alaska-based 172nd Stryker Brigade were nearing the end of their 12-month combat tour in July when they were informed that they'd have to stay in Iraq for as long as four more months. This marks the third time that U.S. forces have been notified that they'd have to stay in Iraq beyond their original return date. The first time occurred in December 2004, when more than 12,000 soldiers and Marines were told that they would have stay for two additional months in order to bolster security for Iraq's first round of parliamentary elections. The second was the Stryker Brigade extension in July. Is the military violating the spirit of the deployment contract with the soldiers and their families? Since the military is now acknowledging that the current troop levels will be maintained in Iraq, why hasn’t Congress addressed increasing the size of the military?

3. The non partisan Congressional Research Service on September 20th issued a 27-page report written for lawmakers in which it said the Bush administration is using signing statements as a means to slowly condition Congress into accepting the White House's broad conception of presidential power, which includes a presidential right to ignore laws he believes are unconstitutional. http://www.fas.org/sgp/crs/natsec/RL33667.pdf In June, Senate Judiciary Committee Chairman Arlen Specter held hearings on signing statements but these are still continually being issued by the Executive Branch. On October 4th, President Bush signed a homeland security bill that includes an overhaul of the Federal Emergency Management Agency and $1.2 billion for fencing along the U.S.-Mexico border to stem illegal immigration. Bush also issued a 1,078 word long signing statement objecting to a slew of the bill's provisions. Does this leave the Bush administration with authority to decide where, when and how long a fence will be built? Do you think that Congress has been effectively asserting its constitutional responsibilities to provide oversight of the Executive Branch? If so, how can you explain why there are no ongoing investigations on waste and incompetence at the Department of Homeland Security? Also, the House Government Reform Committee only held its first full committee meeting during the last week of September to review the Special Inspector General for Iraq Reconstruction (SIGIR) report that stated U.S. reconstruction efforts have been plagued by problems & fraud, and that projects will not be completed?

After considering these questions, would you concede that maybe lawyers could preform a valuable service to protect the American people and our Constitution?

Education
Congressman Boehner, your were a prime sponsor of the No Child Left Behind Act which was passed despite the nay vote from a majority of Minnesota Congressmen (Republicans Mark Kennedy, Gil Gutknecht, Jim Ramstad, and Democrats Martin Sabo and Betty McCollum) as well as a number of prominent fiscal conservative Congressmen including Walter Jones (whom I believe you were campaigning for last week), Jeff Flake, Mike Pence, Dan Burton, and Tom Trancredo. http://clerk.house.gov/evs/2001/roll497.xml
Interestingly, this issue is one that Gutknecht and his Democratic challenger, Tim Walz, agree on … it has room for improvement. But they are not alone. A Commission on No Child Left Behind has been established to evaluate its effectiveness prior to the laws proposed renewal in 2007. As Tommy Thompson, the co-chairman of Commission said "ideas and motives were good, but the way it's implemented right now leaves a lot to be desired."
How do you evaluate the program considering that President Bush has proposed $3.2 billion in education cuts in his 2007 budget, just as NCLB's testing provisions are kicking in? And what is your opinion of Bush’s 2006 State of the Union proposal to train 70,000 high school teachers to lead courses in math and science ? If America is going to be a leader in nanotechnology, broadband and energy, don’t we need a workforce trained for the high-tech world? Lastly, being a product of a private secondary school and private college, how did you gain an understanding of public school operations?

Faith and Politics
Congressman Boehner being a Roman Catholic – as are Gil Gutknecht and Tim Walz – what was your reaction to the Pope John Paul II’s disapproval of the Iraq invasion and his comments on torture and Abu Ghraib prison ? Many Christians are also concerned about the issues of poverty and the responsibilities of environmental stewardship. How does your faith infect, or reflect, your political decisions – or conversely, does religion only matter in issues of abortion, stem cell research and same sex marriage ?

Intelligence
As Majority Leader, Congressman Boehner, you have access to many top secret items. When did you read the April, 2006 National Intelligence Estimate report? Did that report help you guide the other Congressman who did not read the report in your June votes on House Resolutions to support the Iraq War? Congressman Gutknecht emailed a report containing Key Declassified Comments from that report – but without reading the whole report, citizens do not know the context of how to interpret the comments ( Gutknecht wrote “Selective leaks (for political purposes) could lead people to the conclusion that the war has made terrorism worse.”) Some Congressmen who have read the complete report have stated that there is nothing in the report to prevent it from being released in its entirety. Tom Kean in his memoir Without Precedent described reading top secret files and made the comment “I knew all of this. There almost nothing in here that I couldn’t have known from reading the newspapers.” So, to eliminate the concerns of only declassifying portions of the report for political interpretation, should the entire report be declassified ( with agency names redacted) ? Have there been other Intelligence Reports that you have read since the April report that should be made available to all Congressman so that they can make informed decisions? Lastly, your bio does not indicate any military service even though you were of age during the Vietnam era, how did you gain an understanding of military operations and needs?

Local Issues
Congressman Gutknecht has been harping on two initiatives since the start of the Congressional term in January 2004 – Prescription Drug Re-importation and 10/10 Plan (ethanol). Both of these bills have languished in the House. Why haven’t you helped Gutknecht get theses bills to a vote? Are Gutknecht’s speeches just campaign fodder that he knows you and the other Republican leaders will never consider but make it seem like he is a hard working Congressman for seniors and farmers? Does the pharmaceutical and oil industries matter more to the Republican leadership than southern Minnesota issues?

Taxes

Congressman Gutknecht in his campaign ad states that Tim Walz would “repeal the tax cuts…costing the average Minnesota family an extra $2,396 per year.”. Since the medium family income per the 2000 US Census is $40,941, that would be a significant tax impact. There is some concern that this campaign claim is just a scare tactic, but even so, would you assure us that you would remind President Bush that he can use the veto to make sure that working families do not pay greater unfair burden of taxes? And lastly, you and Congressman Gutknecht have preached the unfairness of the Estate Tax – or as you like to call it – the Death Tax. However, according to the same Census figures, only 1.4 % of your district residents (which is also the same percentage for the First District) earn more than $200,000 per year. I have to confess to you that I do not know anyone that would be paying an Estate Tax based on any of the proposals being offered. If the number of people affected by the Death Tax is so small, why are you so emphatic that it be eliminated? With the increases in the national debt that we have experienced under the past six years of Republican control, I do not understand why the rich need another tax break.

Monday, October 09, 2006

This Week’s Political Buzzword : DISTRACTION

Everybody’s talking about Distractions, but I only heard one person talk about the distractions that matter to me.

President Bush said in an address before the Military Officers Association of America "Iraq is not a distraction in their war against America" but the "central battlefield where this war will be decided."
http://www.washingtonpost.com/wp-dyn/content/article/2006/09/05/AR2006090500312.html
MY COMMENT : It’s not about distractions, but the lack of attention.
Candidate Bush after the U.S. S. Cole was attacked said "This tragedy is a reminder that peace is always fragile, and risk is always real and hate in this world does not sleep. We remain in a contest of will and purpose, with enemies who hate America, and target those who defend her. We must always be prepared. And those who attack our nation and its people must always be punished.”
So how did President Bush react to the Presidential Daily Briefing of August 6th entitled “Bin Laden determined to attack inside the United States”?
Or, how did the “War President” react to U.S. Army Chief of Staff General Eric K. Shinseki response to a Congressional question in February 2003 (pre-invasion) regarding the number of U.S. troops needed in Iraq to pacify the country and protect the infrastructure?
Or, how did the “War President” react to John McCain, Joe Biden, and Dick Lugar’s pleas for more troops in 2003?
Or, how did the “War President” react to McCain’s proposal in November, 2005 when he outlined his “Winning the War in Iraq” plan ?
Or, how did the “War President” react to Democratic Congressman Steny H. Hoyer of Maryland proposal “Ensuring America’s Strength and Security: A Democratic National Security Strategy for the 21st Century”?
Or, how did the “War President” react to the April 2006 National Intelligence Estimate?
From Bob Woodward’s book “State of Denial”, there is ample evidence that the real problem is that Bush/Cheney/Rumsfeld are ignoring reality and not providing maximum alternatives to resolve Iraq or to finish the job in Afghanistan.
A true “War President” would be involving allies and “the loyal opposition”.
IF Iraq is lost, it won't be the Democrats fault - or any weak-kneed liberal Pacifist - but the "War President" who wouldn't listen to any advise.


In discussing the Mark Foley scandal, Gil Gutknecht said last week's events are "more distractions than they are pivotal to the outcome of November's elections," adding that "it could get dangerous'' if those distractions pile up."
http://www.bloomberg.com/apps/news?pid=20601087&sid=aUnUTu_ZrhDk&refer=home
MY COMMENT : Foley’s actions are of a personal nature ( not legislative ) and are deplorable. A personal act by one Congressman should not damn the entire Congress. But looking at this over the Congressional term where three other Congressmen have resigned and at least one being investigated (plus investigations into Congressional staffers), it is appropriate to ask how Congress is policing itself. Despite the revelations of the Jack Abramoff influence peddling case, this Republican-led Congress has not enacted meaningful reform legislation that addresses earmarks, privately funded travel, gifts, and campaign contributions. And remember the Republican leadership has not exactly embraced their internal ethics committee as illustrated when Speaker of the House Dennis Hastert replaced the Republican Chairman of the House ethics committee, Joel Hefley, after the committee admonished Tom DeLay for ethical misconduct.


On Tom Hauser’s Debates and Candidate Conversation’s program, Tim Walz was asked about The Wall Street Journal’s description of him as being “The Republican nightmare here in the First District is a burly, high-school teacher and coach who is running as a Democrat ..” [Note, I was channel surfing during a football game commercial when I came across Hauser’s program, so this is from memory – which at my age may be faulty.] Walz’s response was to talk about the District and its Independent and Republican voters. He pointed out the success of Democratic Party legislators from Rochester and that he hears voters being disappointed over using social issues as “distractions” over real concerns. Walz stated that he is a fiscal conservative and expressed concern that our needs are not being addressed.
MY COMMENT : Walz gets it. While most of us are concerned about health care, the national debt (and our personal debts), safety ( be it in the world, at the airport, or even at the schoolyard ), job insecurity, an effective energy policy that limits our exposure to manipulation by other countries, an un-equitable tax policy that favors investment income as opposed to working income, etc.; this DoNothing Congress has wasted more legislative time on Terri Schiavo, same sex marriage and flag desecration.
What happened to the Republican Party that believed that Federal government should not interfere with the rights of the individual? What about the separation of church and state? Where is the support for the rule of law and the importance of oversight to maintain a separation of powers between the three branches of government?
In my opinion, the 109th Congress has accomplished zero and moved to appease corporate interests at the expense of citizen’s necessities.

Friday, October 06, 2006

REAL Challenger Supports Incumbents

It’s officially election time – the question is who will vote and who will not?

Apathy is the big advantage for incumbents. Why did Gil Gutknecht say that he doesn’t think the voters will fire him? Easy answer, he doesn’t think enough voters will show up to counter his base of uninformed, easily manipulated, repeat voters.

Respondents to poll questions may offer their opinion; but that does not mean that they will actually show up and vote.
In fact, polls increase apathy.
If a poll indicates his candidate will win, then the apathetic voter does not have an incentive to participate.
Case in point : voters in Mankato can thank the polling done before a referendum vote to authorize a local sales tax. Polls indicated that a majority did not approve of a local sales tax to construct and operate a community civic center; but they did not show up to vote. It passed due to an unprecedented increase of voter participation in one precinct. That precinct was largely composed of students at Minnesota State University-Mankato. The students were motivated as they thought the civic center would be big-time concert venue. A decade later and Mankatoans are still paying the sales tax while I cannot think of any tier-one or tier-two event that picked the Mankato venue over the Twin Cities facilities.

The weather on November 7th is unknown, but what is known is that there will be lines at the ballot box. The apathetic voter will use this as a rationale for not participating.

It’s an affront to democracy that the politicians use gerrymandering to create districts that protect the incumbents, unverifiable electronic voting machines, inadequately equipped precincts, and now enacting voter identification laws.

Now is the time to confront apathy.
Absentee ballots are now available.
Contact your county Board of Elections. Request an Absentee Ballot Request form via the mail or even better, go the Board of Elections and fill out your ballot.
If you are a student and new to the district, get registered and get an absentee ballot.
If you, or a friend, or family member, have problems getting to the polls, request an absentee ballot.

APATHY is the REAL Challenger.

Remember your opinion only counts, if you participate in the election process.

Monday, October 02, 2006

Gutknecht explains DM&E loan rational – Questions to Ponder

At Monday, October 2nd, Gutknecht-Walz debate, the subject of the DM&E expansion was discussed.

For anyone that is not familiar with DM&E, the stated reason for the legislation is to move coal from Powder Basin Wyoming eastward. Despite the fact that two Class I railroads currently move coal out of the Powder Basin, Senator John Thune – a former employee of DM&E – included funding in the 2005 Transportation Bill to provide billions in federal loans so that DM&E can upgrade track (including through the southern portion of Minnesota.)

At the debate, Gutknecht defended his support for the DM&E loan (which has been denounced by fiscal hawks as inappropriate use of taxpayers monies) – but the logic Gutknecht used was not based on coal, but based on ethanol.

KEYC-TV was there and reported : “Gutknecht not only says he stands behind ethanol production, but, unlike his opponent, he says he also agrees with the Dm & E railroad expansion, saying it's cheaper to loan the money, then to keep up with concrete repairs on the roads. We will be producing about a billion gallons of ethanol within 5 years, here in southern Minnesota if we don't have rail service to move that ethanol it will mean we will have to use 252, 000 trucks to move ethanol that's not safe either.” See the film footage at http://www.keyc.tv/article/view/108187/

Gutknecht has a point that America is increasing its production of ethanol. There are over 100 ethanol facilities currently operating in America … and more planned. Oh sure, Minnesota has existing and planned facilities but so do other states. Iowa has 25 ethanol refineries in production and have three dozen ethanol and bio-diesel projects in various phases of completion. Last month, Missouri Ethanol LLC in Laddonia MO ( about 100 miles NW of St. Louis) began production. It seems as if these facilities are popping up wherever corn can be grown – in towns many of us have never heard of – Portland Indiana, Leipsaic Ohio, just to name two.

So a few questions for Congressman Gutknecht : How large of a rail loan program do you envision to support the logistics for the hundreds of production facilities located throughout America’s countryside? How many ethanol facilities will be serviced by DM&E ? How will ethanol producing facilities in Winnebago, Fairmont, Granite Falls, Little Falls, etc. link up with the DM&E tracks? Why are the taxpayers being used for a program that will largely benefit one company ? U.S. railroads are slated to invest a record $8 billion in capital expenditures this year. How will BN, Norfolk Southern, Union Pacific, etc respond when the government sets up a program that benefits one competitor? Isn’t a railroad a capative mode of transportation (it goes one way and only one train can be on that section of track at a time) but roads can be used by passenger vehicles as well as trucks, so why not invest in better roads?

Gutknecht is correct that rail can be part of the solution, but not to the advantage of one company. Congressman Jim Oberstar has offered a broader solution in H.R. 5965 which was introduced into the House on July 28, 2006 and already has 126 cosponsors. H.R. 5965 is the Railroad Track Modernization Act of 2006 and Transit Rail Accommodation Improvement and Needs Act which would promote Transit Use & Develop a Rail Infrastructure Program that would create a stimulus package of infrastructure investment that upgrades the pipeline for biofuels – the freight rail system – in order to get an affordable and reliable supply of biofuels to market.

Gutknecht has identified a problem, but is trying to justify constituents’ complaints concerning DM&E by aligning it to an entirely different problem.

Gutknecht Negative Ad Illustrates Differences

Gil Gutknecht has started his television media campaign with a negative ad. The conventional wisdom is that negative ads work - especially if released close to the election when the opponent cannot respond. By going negative so early, Gutknecht is acknowledging that he cannot run based on his performance but must scare voters on the evils that his opponent will do. It’s a bad strategy -- and could actually benefit Walz, if Walz can get the facts out.

The “Meet Tim Walz” ad asserts that :
“…he’ll increase spending on virtually every federal government program”;
He’d repeal the tax cuts…costing the average Minnesota family an extra $2,396 per year.”;
Plus, he’d increase the estate tax, gas taxes, Social Security payroll taxes, and even tax the Internet.”

Let’s evaluate these assertions.

First, how does Gutknecht justify his own votes to increase federal spending? He has twice voted to raise the National Debt Limit in the past two years to accommodate the inability for Congress to pass a balanced budget while the National Debt has increased over $1.1 Trillion. Gutknecht is a FiscalFraud – not a FiscalHawk. He may argue that he has voted to approve omnibus spending bills as the good, and necessary, outweigh the wasteful. But what about when specific items are processed via amendments which actually require a roll call vote. Why did Gil Gutknecht support $500,000 in funding to be used for renovations to the Banning, California city-owned pool (although San Bernardino Sun reports that Banning city officials have been “stockpiling” this federal funding in order to build the new pool, which will serve a town of 26,000 and will cost approximately $4 million to build (H.R. 5576 See Roll Call 277- FY2007 TransPORKtation Bill)? And what about his salary increases that he has approved every year? Gutknecht is a classic TaxCut and Spend RoveRobot.

I will concede the second point that Walz would repeal the tax cuts. After all, Walz’s website says “Eliminating the Bush tax cuts for the wealthest 1% for the ten year period from 2006-2015 will reinstate $725 Billion in tax revenues with another $180 Billion for the interest on the money to borrow to finance them. Additional revenues can be realized by taxing Anti Family practices like Internet pornography. The cost of the Middle Class Tax Cuts outlined below is less than $21 Billion -- less than 3% of the tax breaks eliminated.” But I disagree that each Minnesota family would incur an additional $2,396 tax bill … as I do not think that every Minnesota family is in the top 1%.

I will also concede Gutknecht’s point that Walz would “even tax the Internet”. Once again, Walz’s website provides some details : “The Internet Pornograpy Industry generates $12 Billion in annual revenues – roughly equal to the combined revenues of ABC, NBC, and CBS combined. Revenue estimates for child pornography range from $200 million to $1 Billion per year.
[snip to Walz’s Plan]
Require real child access prevention for pornographic websites and impose a 25% smut tax on adult Internet pornography.”
WOW. There you have it – Walz would tax the Internet to combat crimes against children.
Now let’s also consider how Gutknecht stands on the Internet. This summer, on HR 5252 Gutknecht effectively voted to change the rules of how the Internet operates and allow telephone companies to charge fees and determine what information is made available. Despite appeals by such groups as Christian Coalition of America and Gun Owners of America, Gutknecht listened to the telecommunications industry. And the reaction from the telecommunications industry was quick as Verizon immediately announced a change in policy to charge user fees. I always wondered why BEVCOMM was his top contributor and why the telephone industry was at the top of his donors list ( number 2 on the list while not being listed in the top 25 for 2004 election session.) I supposed being the Telecommunications Task Force Co-Chairman may encourage donations. This is not the first time that Congressional action while under the guise of helping the consumers has created opportunities for telephone companies to charge new fees that consumers may not want or need. The Telecommunications Act of 1996 allows a monthly fee of 33 cents for each land based telephone account … a small fee paid by each consumer adds millions of profit to the telephone company for a service that was previously provided (if you want more details, just ask.)
I suppose since Gutknecht voted to allow a “fee”, this is not an example of a tax increase. Incidentially, I understand that Walz supports Net Neutrality while Gutknecht does not.

Finally, since Gutknecht brings up the Estate Tax, it is fair to ask who is affected. The tax, which has been law since 1916, if repealed as Gutknecht advocates, is estimated to cost $1 trillion from 2011-2021. Although usually advertised as affecting the family farm or small business owners, the tax affects few Americans and if repealed, would give some families extraordinary windfalls. The CEO’s of major oil companies would get enormous benefits – for example, Lee Raymond (the former ExxonMobil CEO), alone could receive a tax break worth over $160 million. Remember Gutknecht enthusiastically endorsed H.R. 4761 earlier this summer. The bill concerns itself with allowing drilling for oil on Outer Continental Shelf (oh, and what was the fiscal impact of that bill? on June 29th, the White House issued a statement on that bill. “The Administration strongly opposes the bill’s revenue-sharing provisions because of their adverse long-term consequences on the Federal deficit . The Administration’s preliminary estimate is that the revenue-sharing provisions of H.R. 4761 would reduce Federal Receipts by several hundred billion dollars over 60 years.”).

Judging from Gutknecht’s assertions and performance, Walz’s plans address the majority of voters. But if you’re affluent and make campaign contributions, Gutknecht is there to help you.

The other bonus that Walz gets out Gutknecht’s ad is name acknowledgement. As a challenger, name association is critical – ask someone in July to name their Congressman and many won’t have the correct answer, but by November, the incumbent will be easily identified. Unless the challenger is known outside of politics, he faces a considerable disadvantage, but Gutknecht has repeated Walz’s name and photo a number of times in the ad. Not smart political strategy .. but I’ve been watching Gutknecht implode since Walz announced his candidacy.

Voters, please take a moment and read Walz’s position paper on Middle Tax Cuts.
http://www.timwalz.org/vertical/Sites/%7BDD1DDF80-8E82-48D5-8648-607855AC529B%7D/uploads/%7B6FE57A5D-1413-4327-BF42-EA529683D1C7%7D.PDF

Sunday, October 01, 2006

VOTER WARNING : Gutknecht eline misleading

Allow me to prefix my commentary with a little background. I worked in the accounting field for over 20 years, being involved with acquisitions, auditing, writing operational manuals, negations of multi-million dollar contracts and I have provided cost analysis to the Department of Defense. But more importantly, I am a citizen who is concerned about the financial future of the country.

Consequently, I pay attention to how my elected representatives act and what they work on. In my January 27th commentary , I wrote in response to the Special Inspector General for Iraq Reconstruction (SIGIR) report that stated U.S. reconstruction efforts have been plagued by problems & fraud, and that projects will not be completed :
Being fiscally conservative myself, Gutknecht advertises that he should be an elected official that I would be pleased with. Sadly, with increases pending in the Federal Debt Limit, and the continuation of budget deficit spending, he has disappointed. When the question "should America liberate Iraq?" was first asked, the other question should have been "who is going to pay for it?" Will we pay or will our grandchildren still be paying? Mismanagement of spending is making the problems worse.
Is it too much to ask a Congressman who sits on the House Reform Committee to look into what happened to Iraq's $37 billion in oil-financed reconstruction funds ? How about looking at Halliburton, the giant oil services firm, which received $1.6 billion in DFI money for fuel and oil field repairs that Pentagon auditors say it overcharged the government by $218 million.




So eight months later, Gutknecht finally issues a response as a Footnote in his eline of 9/29/06 :
NOTE: My Government Reform Committee held its seventh oversight hearing. At the insistence of House conservatives, money was authorized for additional auditors for money spent in Iraq and Afghanistan. Troubling reports are coming out concerning waste and mismanagement. We need to hold people accountable. We intend to hold more hearings in the months to come.



On the surface, Gutknecht’s comment may seem to indicate a Congressman leading the charge to ensure fiscal responsibility and proper Congressional oversight.

At a minimum, his comments are misleading.

This is the first full committee hearing on Iraq Reconstruction during this Congress ... and it essentially occurred during the last week before another "re-election campaign" recess. Iraq is too important of an issue that the full committee has not met to address the reconstruction problems. Based on continued media reporting of problems, discussions at the subcommittee level are not accomplishing anything.

Second, the Democrats have been clamoring for investigations not only of the Iraq Reconstruction, but also of the waste related to Homeland Security Contracting and Hurricane Katrina Relief. Based on Gutknecht’s comment that the additional auditors is a result of the “insistence of House conservatives”, I can only assume that the Republican House Leadership of Dennis Hastert and John Boehner are to blame.



Gutknecht’s one paragraph comment is insufficient to understand the enormity of the problem. But if you read the GAO report and SIGIR reports that are part of the Committee on Government Reform hearing, every taxpayer would be alarmed at the ineptness of this Congress to manage our monies.

The Government Accountability Office identified a record $3.5 billion in questioned and unsupported contractor charges in Iraq. The Special Inspector General for Iraq Reconstruction comments on the dilapidated facilities at the Baghdad Police College, which the Army and the Parsons Company spent $75 million to build and cannot be used to train recruits because "feces and urine rained from the ceilings" of barracks. [Note : I have previously referenced the Parsons Company’s performance in http://minnesotacentral.blogspot.com/2006/08/gutknecht-invokes-politically.html ]

An example of the waste and mismanagement is to reconstruction of the healthcare system in Iraq. The Basrah Childern’s Hospital Project was authorized for $50 million with a target completion date of March, 2006. It was revised to be completed by July 31, 2007 at a cost of $98 million. The current SIGIR audit report states “the actual turnkey cost for the project will be about $149.5 million to $169 million.” The overall Primary Healthcare Center project began in 2004 with a goal of 150 centers at a cost of $243 million. Despite an expenditure of $186 million, the government has now revised the contract to only 20 centers of which six have already been completed.

In the oil sector, the Bush Administration has spent 2 Billion Dollars and yet the oil production is, at best, meeting pre-war levels.

In the electricity sector, the Bush Administration has spent 4 Billion Dollars and is still only achieving 81 % of the desired output.


These failures do not just impact the reconstruction progress, but also the entire effort in Iraq. How can we change the mindset of the Iraq citizens when we display such incompetence?


I will agree with one comment that Gutknecht makes – “We need to hold people accountable.”

So voters, let’s remember to hold Gutknecht accountable.

Accountability and Oversight are sadly missing from this Congress.



Related Links :

http://reform.house.gov/GovReform/Hearings/EventSingle.aspx?EventID=50958

http://reform.house.gov/UploadedFiles/GAOd061130T.pdf

http://reform.house.gov/UploadedFiles/SIGIR FINAL HGR Testimony - 09-28-06.pdf