News Cut: December 10, 2008 Archive

Sources

Posted at 8:27 AM on December 10, 2008 by Bob Collins (6 Comments)
Filed under: Crime and Justice, Politics

There was a tough call in the investigation of Illinois Gov. Rod R. Blagojevich. It was made by the Chicago Tribune, the now-bankrupt newspaper which has new friends today just because of the enemies it has (By the way, yesterday was a good reminder of why we still need newspaper reporters turning over rocks and making enemies on a daily basis).

The Tribune had the "goods" on Blagojevich's alleged corruption but didn't print the story because the feds said it would jeopardize their investigation into Blagojevich. The investigators hadn't yet placed the bugs in Blagojevich's home and office, according to reports.

"In the course of doing our work, we talked to the U.S. Attorney to get comment as we would with any story and at that point they indicated if we publish at that moment, it could jeopardize an unfolding investigation," editor Gerould Kern said. "It's always a difficult decision." (See video)

It's obvious that on this story, the Tribune didn't need much more than a comment from prosecutors for the story they had, but probably extracted a promise from prosecutors for either additional information, or an early tip-off when the governor was going to go down. There had to be a quid pro quo of some sort (Aside: Read the complaint against the Illinois governor).

Fast forward to a story this morning in the St. Paul Pioneer Press about allegations that a backer of Norm Coleman funneled cash to the senator through a business in Texas. The story was headlined:

FBI reviewing allegations involving Norm Coleman ally, source says

The headline makes clear that the story is based on a single source and while the assertion may be true, there's no indication there's any second confirmation, a pretty standard protocol in basing a story on an anonymous source.

It's not like the Pioneer Press didn't try as evidenced by two responses it got:

The Coleman campaign issued a statement last night:

"We are not aware of any investigation that is under way, nor have we been contacted by any agency with respect to this matter. As we have said repeatedly, we welcome any investigation of these lawsuits by the appropriate authorities to get to the bottom of these baseless, sleazy and politically inspired allegations."

And a spokeswoman for businessman Nasser Kazeminy had a similar response when asked if Kazeminy had been contacted by investigators." We have no information along those lines. What you're telling me is news to me," Amy Rotenberg told the Pioneer Press in a statement that invites hours of parsing.

As for the FBI, the Pioneer Press got the same answer you'd get if you called to ask if the FBI was investigating you. "We do not confirm or deny the existence of any investigations."

Conclusion: The Pioneer Press doesn't have enough yet to make the feds nervous about jeopardizing an investigation that may or may not be taking place.

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Ethanol subsidy may be a target

Posted at 12:18 PM on December 10, 2008 by Bob Collins (16 Comments)
Filed under: Economy

When he unveils his plans for closing the projected $5.2 billion budget deficit, Gov. Tim Pawlenty will be hard-pressed to leave one of the state's sacred cows unscathed -- ethanol. And few of its backers will talk about the possibility today.

Ethanol, of course, has been hailed in Minnesota as the economic future for rural Minnesota farmers, and an answer to an evolving energy crisis. And the state has been among the leaders in supporting it, not only with a mandate for ethanol in gasoline sold in the state, and tax-free zones where ethanol plants are likely to be built, but also direct -- and somewhat controversial -- payments to ethanol producers.

In 2007, Minnesota paid over $15 million to ethanol plants as part of a per-gallon subsidy. Gov. Pawlenty has argued that it's a worthy investment with a large return. The state, however, cut the payments during the last budget crisis in the state (although it cut sizeable checks more than a year ago to make up for the cut), and seems likely to target the subsidy again. Nobody in the State Agriculture Department today, however, would speak to the possibility.

If the subsidy is targeted, it couldn't come at a worse time for rural Minnesota. Because the demand for gasoline is down, so is the demand for ethanol. Last month, one of the largest ethanol producers -- VeraSun -- declared bankruptcy after betting the price of corn would keep going up. The price of corn fell sharply, though, and VeraSun is out of cash. The producer payments can help secure private lending, but the tight credit markets remain in a deep freeze.

Last week, an ethanol plant in Iowa closed up. "We were still chewing through $6 corn (recently) and ethanol was around $1.50," Pine Lake Corn Processors president Larry Meints Meints said. "Hedging, that did not go well... It's very disappointing."

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Bailout recipients are big political donors

Posted at 12:44 PM on December 10, 2008 by Bob Collins (3 Comments)
Filed under: Politics

The watchdog Web site OpenSecrets.org has released a study today showing many of the companies in financial trouble now (and asking politicians for help) were the same companies that bankrolled elements of the political party conventions in St. Paul and Denve last summer.

Embattled insurance giant American International Group (AIG), which received an $85 billion loan from the government just weeks after the GOP convention, gave $750,000 to each gathering. And AIG isn't the only high-profile company that sought a handout from taxpayers after writing a big check toward the summer's political gatherings. Others included Citigroup (which spent a total of $600,000 on the conventions), Goldman Sachs (which spent $505,000), Ford Motor Co. ($100,000 to each convention) and Bank of America (which spent $100,000, entirely on the Democratic convention). The federal government took over Freddie Mac just weeks after the mortgage buyer split half a million dollars between the two conventions.

The full report from the Center for Responsive Politics is here.

(h/t: Mike Mulcahy)

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Cuts at NPR

Posted at 1:05 PM on December 10, 2008 by Bob Collins (11 Comments)
Filed under: Media

The big media recession hit National Public Radio today. Two shows -- News & Notes and Day to Day -- are being dropped and 7 percent of NPR's staff is being laid off.

It's the organization's first widespread layoffs in 25 years, the Washington Post says.

NPR had hoped News & Notes would attract more African Americans to its audience. The Post says the cuts represent a retreat from NPR's goal to diversify its audience:

Combined with the elimination of "Day to Day" and "News & Notes" the cutbacks constitute a retreat from NPR's efforts to reach new listeners, especially young people and members of minority groups who are not part of NPR's "core" audience. The diversification effort started in 2002 with the opening of NPR West, the organization's first major production facility outside of Washington and New York. The facility will remain open after the cutback, but with about half of its 60 employees.

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Loose change

Posted at 5:10 PM on December 10, 2008 by Bob Collins (0 Comments)
Filed under: Politics

What's in a promise? When it comes to state government and desperate economic times, nothing.

Officials are searching under the state's couch cushions looking for loose change and quite often it means taking money that was to be used for something specific, and using it for something else instead.

The state's health care access fund, which comes from taxes paid by Minnesota health care organizations and professionals, is what funds MinnesotaCare, the state's health care program. It usually runs a surplus and when budgets are tight, the state officials have taken the money and used it for other things, which drives the health care groups crazy.

"I think somewhere in the neighborhood of $500 million over the last five years has been taken from that fund to plug holes in the general fund budget, and that's very problematic to health care providers," Lawrence Massa, president of the Minnesota Hospital Association, told MPR's Lorna Benson last week.

When St. Paul raised its sales tax by .5 percent in the '90s, it did so with the promise that part of it would go toward paying debt on RiverCentre, and some it would be used for the neighborhood STAR program.

But the city has been using more of the neighborhood money to pay debt and it's asking the Legislature for permission to keep doing it.

Today, the St. Paul Legal Ledger's Charley Shaw writes that some legislators -- at least one of whom is a pilot and airplane owner -- is concerned that a fund specifically to improve airports, will be further diverted to closing the budget gap.

Members of the Airport Funding Advisory Task Force on Monday said the "integrity" of the money generated from various aviation taxes and user fees is in question. That's because during the 2008 legislative session, $15 million from the Airports Fund was tapped to help solve a $935 million general fund budget deficit for the current two-year budget period.

Now that the state faces a $4.8 billion deficit in the 2010-2011 biennium, Rep. Michael Beard, R-Shakopee, is concerned that future revenue for the State Airports Fund will be used for purposes other than aviation.

At the Capitol today, leaders of cities which receive local government aid, are concerned they'll lose it. And they've got a good reason to be concerned: There's almost $500 million sitting in that pot.

The governor is scheduled to unveil his budget recommendations by January 27.

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Absentee ballots

Posted at 5:46 PM on December 10, 2008 by Bob Collins (1 Comments)
Filed under: Politics

There were two developments on the recount front today.

First, the Franken campaign has posted a lengthy video on YouTube featuring interviews with people whose absentee ballots didn't count.

Meanwhile, this afternoon the League of Women Voters, Common Cause, and Citizens for Election Integrity issued a joint press release calling on the State Canvassing Board to allow the absentee ballots.

The non-partisan Coalition believes Minnesota's election officials are best suited to determine the mechanics to resolve this issue. It is imperative to the citizens of Minnesota that every legitimate vote is counted. Where a voter properly completed an absentee ballot, that vote should not be invalidated by operation or error of election officials.

We encourage the canvass board to speak with one voice and send a clear message to Minnesota voters that the purpose of the board is to ensure the integrity of this election. Partisan politics must not take priority over counting each and every legitimate vote.

Late last month the State Canvassing Board said voters whose votes didn't count should take the issue to court. It may take up the issue again on Friday.

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