January 21, 2009

Frank talk on corporate jets gets a good grounding in Congress

Posted: 04:08 PM ET

Note from reporter: Congressman and Senators love to get a lot of press when initiating bold, new legislation, tough talking amendments or major initiatives.

One of the reasons they seek media attention on the "front-end" is because they know, as do those of us who cover them, that it is very rare anything ever really gets done on the"back end".

Most new legislation winds up going nowhere. In our continuing effort to "Keep Them Honest" here is a look at one of those bold proposals that went nowhere almost immediately upon its introduction .


When those auto makers flew to congress in corporate jets to ask for a taxpayer bail out, no one was more upset than the powerful chairman of the house financial services  committee, Rep. Barney Frank(D-MA).

So irate over the use of corporate jets, Frank was determined to make sure it never happened again. His plan, no corporate executives coming to Washington asking for bailout money would be allowed to travel in those multi-million dollar symbols of excess.

 To make sure corporate America got the message, Mr. Frank dropped a provision into the latest bailout bill, H.R. 384, the TARP Reform and Accountability Act, requiring would-be recipients of taxpayer funds to dump their corporate fleets. Basically, if you want taxpayer money, sell your jet and fly commercial.
That sure sounded tough. And it sure sent a message to the automakers. When they came back to Washington they drove.

 But it turns out Rep. Barney Frank may have overreacted. Last week Rep. Frank quietly stripped the no-jet provision from the bill. Why? Kansas.

 Kansas is a hub of aircraft manufacturing, particularly the making of corporate jets. Fellow democrat Rep. Dennis Moore (D-KS)sent a note to Congressman Frank delicately suggesting the powerful chairman re-think the tough talk.

 "We have to be careful about congress overreacting," Moore wrote in a statement.

 What he wrote to Chairman Frank was more diplomatic.

 "It is clear that the auto executives were insensitive to American taxpayers when they flew in their private jets to request billions of dollars. But I have concerns that applying this well-intended provision may have unintended consequences of hurting the general aviation industry and its  workers."

The congressman pointed out pointed out 44-thousand workers in Kansas work directly for the airplane manufacturing industry, and a lot of families depend on those paychecks.

Last Tuesday the "no-fly" language was dropped, and yet another get tough message from Congress got a soft landing.

Late today, Chairman Frank sent a statement to CNN explaining why.

Here it is: "The private aircraft industry is an important industry in America, and it plays a necessary role with businesses in certain areas of the country.

For example, there are a number of communities that do not have commercial air service available for hundreds of miles.

Some of these communities are already in economic distress, and denying businesses the ability to use private aircraft further disadvantages these businesses and seriously impacts thousands of American jobs that provide services to this industry.

 I heard from many members of Congress from both parties representing a half a dozen states expressing concerns of their constituents in regard to this matter and hence why we further reviewed the issue and ultimately removed it from the legislation."

Filed under: Drew Griffin • Politics • Special Investigations Unit

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January 20, 2009

How did they get that seat? They paid.

Posted: 11:45 AM ET


This may be a day of change, but one thing never seems to change about Washington: money opens doors, and in this case seats to history.

While millions huddle in the cold for a peek of the swearing in ceremony, those with thousands have paid for the privilege most of us can’t afford.

The inauguration is being financed by private donations. The donations are being limited to $50,000 per contributor.

No lobbyists are allowed to give, per strict rules by the Obam-ites. But like all things DC there is wiggle room, so families of lobbyists can give.

Others, like liberal activist financier George Soros seems to have his whole family giving the limit.

The Center for Responsive Politics collected the data. You can view it right here.

Take a look at who you see on screen and then see just how much they gave to get that spot.

I find it a fun and interactive way right here to see how Washington never really changes. 

Filed under: Drew Griffin • Politics • Special Investigations Unit

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Journey for Change Notebook: November through January

Posted: 06:00 AM ET

Editor's Note: Thirty kids, ages 12 to 16, from Bushwick, Brooklyn, were chosen to participate in "Journey for Change," a youth empowerment program created by Malaak Compton-Rock. In early August they traveled to South Africa with Compton-Rock and CNN Anchor Soledad O'Brien. The group returned to the U.S. on August 13. Since their return, they've been fundraising and doing service projects. For three days in late December they volunteered at several locations around Brooklyn: a daycare center, a soup kitchen, an abused children center, and a homeless shelter. They also picked up garbage in the streets of Bushwick. All of this followed a November trip to Washington, D.C. where, among other things, they met with Congresswoman Maxine Waters. We've asked them to share their thoughts and experiences by blogging. In July, the group's journey will be featured in Black in America 2: Solutions, a CNN Presents documentary hosted by Soledad O’Brien.

Journey for Change participants traveled to Washington in mid-November. During the visit they briefed Rep. Maxine Waters (D-Calif.) about their South African trip.


"I just wanted to tell how you much fun I had today. For starters Barack Obama is the United States President. He finally did what most people said he couldn't do. Today, I managed to make it upstairs to my homeroom to see Obama's speech. He talked about bettering our country, but first all Americans need to come together to help each other out by rebuilding urban and vacant land back to what it is supposed to be. If we Americans can do that, and maybe even more, Barack can handle the rest. Seeing that just made my day. The second after Barack was sworn in, there was noise throughout the entire fourth floor. During lunch we had a huge celebration in the cafeteria!! Today was the best of many days to come. I have witnessed an historic moment today."

-Jordan Ratley, 12


"It has been fun. I liked working at the daycare center. The kids had a lot of energy and loved seeing us. I loved nap time and I slept with them for a while. Volunteering in my own community means a lot because cleaning up the community is like cleaning up our home. This is our home and having garbage around is nasty. Even though some of the garbage was covered with poop, we cleaned it up anyway and made our neighborhood nice."

-Queen Clyde, 12

"Helping to clean up the community and seeing the results and how we made a change was my favorite part."

-Jasmine Figueroa, 14

"The best part was maintenance around the Salvation Army. I liked going into each block cleaning the blocks. It was nasty but worth it. Some people thought we were doing community service because we got in trouble. When we told them we didn't but were just doing it, they said we had good hearts."

-Zuliana Burnett, 14

"My favorite part of volunteering was in the nursery school because I like playing with little kids. I can relate to them because I have a baby sister who is five. I didn't think that I was going to like cleaning up because I thought I was going to see people that I know. But I held my head up and got to cleaning. I felt good about giving back to the community. I know it is not a lot but it is something. And all of this can go on my resume."

-Jeremy Baker, 15

"I liked cleaning up the neighborhood. I had a lot of energy and was a leader. I kept everyone going and made sure that they did not miss a spot. It made me feel excited to clean up my own community."

-Jonathan Severe, 14

"I liked picking up the garbage because it felt good looking at a block and seeing how dirty it was. After cleaning it up, to look at how clean it was gave me a good feeling."

-Albert Brunn III, 12

"I have enjoyed helping the needy and my community. I was able to see a different side of us. I liked my first day in the food kitchen the most. I liked giving people a hot meal."

-Sadara Lewis, 13

"I liked cleaning up the neighborhood –- sweeping it and picking up the garbage. I liked that people appreciated our efforts. It helps to communicate to everyone around that we care about our own environment and lives."

-Sydney Smart, 12

"I liked volunteering at The Salvation Army Center that helps children who have been abused. I worked as an administrative assistant and I filed papers and made copies. The filing was fun because it was challenging. It also made me realize the other side of helping people. I did not think about the office work that needs to be done."

-Imaan Williams, 12

"I enjoyed cleaning the neighborhood because people said thank you to me. They really appreciated what we were doing. I liked helping the kids in the daycare because we helped them to do arts and crafts and make gingerbread houses. It was fun. I also got to experience how to work in an office at shelter for kids. That was a fun place to volunteer at even though it is for a sad reason."

-Tasheema Fulmore-Walker, 14

"I had fun playing with the kids. I ran relay races with them. I also helped to clean up the Community Center. It was a nice thing to do because now the kids have a clean place to eat and play."

-Shawn Todd, 16

"It was really nice to see how happy we made people when we were cleaning up the neighborhood. I liked working in the day care with the kids. They were so cute and fun."

-Dasia Carr, 12

"My favorite part was helping out in the day care because I liked playing with the children. It was good to know that I was able to help them. I liked the community clean up as well. It was nice to know that I was giving back to the community by keeping it clean."

-Shaquille Cadougan, 14

"I worked with the after-care kids and we went on a scavenger hunt with them. That was a lot of fun. I like kids and it was nice to be able to help them have a nice day. That was my favorite part of volunteering."

-Malik Stanford, 12

"I liked cleaning up the streets because it was fun and nice to get compliments from people saying that we were doing a good job. I liked playing with the babies in the day care and doing the administrative work at the center that helped abused kids. It was nice to give back in my own neighborhood."

-Latoya Massie, 14

"Helping people with their jobs has been nice. It felt good to be useful and to take a load of work off of their hands. I liked babysitting the kids in the daycare the best."

-Donovan Rodgers, 13


"My experience to Washington, D.C. was fun. While we were there, we visited the Lincoln Memorial, The Holocaust Museum, and other places. The best part of the trip was going on a college tour. I got to see Howard University and Georgetown. I think that was an excellent thing, going on a college tour, to have an idea of what college we might want to go to later on in the future after finishing high school. When we went to Howard University I felt so welcomed because the students who went there, and the director, were absolutely friendly to us. They gave us gift bags with a Howard University hat, shirt, application, and a bag. That was a nice and generous thing that they did for Journey for Change. Another college that Journey for Change visited was Georgetown. It was huge and it's a Catholic college. The tour for Georgetown University was nice. I thought the college was beautiful.

The saddest part of the trip was when I went to the Holocaust Museum. It was so hard to see that all of the Jewish people were tortured and killed.

The restaurants that we went to had great food. Like at America, the food was good. There was another restaurant that we went to called Busboys and Poets, and the food was great there too. I was grateful that we were able to choose a book from the gift shop there and keep it.

Going to Senator Schumer's office was interesting. I got to learn about what a legislative aide does for a senator and how you can get that job. I went to the Capitol for an advocacy meeting and Congresswoman Maxine Waters was hosting it. I got to learn about the Capitol and some of the laws.

The last day of the trip, we went to the Newseum. It was so fun. When we watched the movie, it felt so realistic when the mice ran across the floor. Queen, Jenee, and I had jumped and were scared the whole time. I really didn't want to leave yet because it was getting better and better. But for the most part, I had fun staying in the hotel and during my whole experience in Washington, D.C."

-Zuliana Burnett, Age 13

"Just came back from Washington D.C. and it was great. We visited many sites: The Lincoln Memorial, The Jefferson Memorial, The Holocust Museum, The Newseum, and we toured two colleges –Howard University and Georgetown. I really enjoyed the Newseum. It's unbelievable that one place can store so many news articles going back to the 1800s. Howard University was great. I have to start thinking about colleges soon, and I told my folks that I would really like to attend Howard University. They even have their own hospital in the college!!! Meeting with Congresswoman Maxine Waters was great. She spoke about how she got to where she is and what she does. Staying in school pays off in the end. Just to think, we were in the same room where laws are made! That was a good feeling. Bye for now."

-Joshua Hall, 15

"I learned a lot in Washington, D.C. I mostly enjoyed touring the colleges. At Howard University, I learned that the Power Tower Clock is the highest point in D.C., not the Washington Monument. I also learned that the chapel there is where Dr. Martin Luther King Jr. and Malcolm X first met. There we also met with the University President's wife and had a tour guided by some of the students who attend Howard. At Georgetown University I found out that they can actually pay your tuition for you. They also have cannons that are the only weapons that can point at the White House.

While we were in Washington we also met Congresswomen Maxine Waters and saw the work place of Barack Obama when he was a Senator. Besides that we did things that people would normally do when they visit Washington, D.C. like going to monuments and museums. We also had an excellent driver, Al. He informed us about many sites in D.C. that most likely we wouldn't have noticed or known if he hadn't told us."

-Dasia Carr, 12

Filed under: Journey for Change • Soledad OBrien

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January 16, 2009

Madoff Red Flags?

Posted: 02:32 PM ET

Slowly but surely more information is coming out in the Bernard Madoff case. One of the big questions remains: With this being one of the largest alleged Ponzi schemes in history, is it really possible that Madoff acted alone? Or were others involved in the scam?


Industry insiders have told me they question whether regulators were either not sophisticated and experienced enough to uncover a massive fraud, or whether there was someone on the inside purposely looking the other way.

This week, Congressman Paul Kanjorski (D-PA), the chairman of the House Financial Services Subcommittee who is investigating the Madoff case, released a statement that suggests more red flags than originally thought were missed by federal regulators in this case.

He points to the 2007 audit report of Bernard L. Madoff Investment Securities. He says it contains obvious warning signs that should have alerted the Securities and Exchange Commission.

Kanjorski says the audit report did not include basic information such as an income statement, an accounting of how money was managed, or even a statement of cash flows. Click here to read Congressman Kanjorski’s statement to S.E.C. Chairman Christopher Cox.

Essentially, it was a report with a bunch of boxes checked, without information attached. (Or maybe the information was attached, but it has somehow gone missing.)

Kanjorski also raises questions into the S.E.C's inspection policies as they relate to internal controls for broker-dealers and their auditors. Kanjorski says a "competent" auditor would have likely spotted the alleged scam much earlier.

So, once again, the big question: Was it a lack of “competency” or did qualified people simply choose to trust Madoff and look the other way?

Take a look at the audit report yourself – it’s only eight pages. Does anything stand out to you? Do you agree with Kanjorski that the report should have raised red flags within the S.E.C. about Madoff’s operations? Click here to read the 2007 audit report of Bernard L. Madoff Investment Securities.

Filed under: Uncategorized

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January 7, 2009

Victory for our summer interns!

Posted: 01:05 PM ET


Well they aren't summer interns anymore. Actually most of them are probably working real jobs, but their work two years ago for CNN's investigative team finally has brought the entire congressional earmark process into the open.

In the summer of 2007, we assembled a team of interns to ask every senator and every member of Congress to disclose their pork barrel requests, known as earmarks. The requests in the past have been done in complete secrecy. Most of us found out about pork barrel spending only after it was included in budget bills.

We upset a lot of politicians with that survey. Most members of Congress and the Senate never even bothered to call us back. But a few did and thought it was a good idea for us to post their requests online.

Now they all will have to do it....because the two people in charge of doling out the money, Sen. Daniel Inouye (D-Hawaii) and Rep. David Obey (D-Wisconsin) issued new rules today (you can read them below). Basically, if you want the people’s money, you’d better tell the people why, online and in advance.

I can't help but think our summer interns have brought a little summer sunlight to the dark world of congressional spending.

For more info see this release.

Filed under: Drew Griffin • Politics • Special Investigations Unit

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