Tag Archives: 60 minutes

Baucus Staffers Depart; the Door Revolves

The National Journal today reports that Max Baucus is losing staff at a rapid pace.  How this exodus bears on the odds of a Baucus re-election in 2014 is anybody’s guess.

But we know how ordinary tax-paying citizens are faring.

His chief-of-staff has announced that he’s leaving to take a job with a “strategic intelligence firm.”  Strategic intelligence firms are companies that use all sorts of channels, and sometimes espionage-like techniques, to get valuable information for which Wall Street investors will pay a king’s ransom.  This is not “insider information” per se; it’s all legal, due to shady loopholes in the law.   And one such type of “intelligence” is the advance notice, beloved by hedge funds and other Wall Street bigwigs, of how Congress might act on a matter under consideration.   Someone with inside knowledge of how a vote is going to turn out, or whether an amendment will live or die, or even what type of language will be inserted into a bill, can sell this information to an investor who can then trade on the information (sell certain defense contractor stocks, for example, if it looks like Congress is about to vote to cut funding for fighter jets).  And “intelligence firms” have made an industry out of gathering this type of up-to-the-minute information on bill status.  60 Minutes did an excellent piece on this scam, and you should watch it. We don’t know for certain that Max’s chief-of-staff will be doing this type of stuff, but it’s hard to imagine that he won’t be.  Its not lobbying, either.  It’s not asking anything of congress other than information.

And another top aide, Baucus’s tax expert on the Finance Committee who shuattled back and forth between Congress and the private sector for many years, is going private once again. Don’t be surprised if he ends up at a company that has benefited handsomely from tax breaks given out by the finance committee over the years.

It’s important to understand that this profit-making careerism has enormous negative repercussions for average Americans.  Tax breaks for major corporations (the chief currency for revolving door specialists) come at the expense of ordinary taxpayers, who must make up the difference to fund government.   Similarly, if you are a person of ordinary means and own stock in a company, any advance notice about some decision that your elected representative might take that will affect the price of your stock should be as available to you as it is to an investment banker who hires snoops to troll around Congress.