McCain’s Gramm headache continues to linger

June 1, 2008

I’d hoped, in vain, that Phil Gramm’s role in the McCain campaign — which became a more serious issue this week — would generate a bit more media attention than it has. We learned earlier this week that Gramm was chiefly responsible for shaping John McCain’s housing policy in the midst of a mortgage crisis, despite the fact that Gramm was also serving as a lobbyist representing a foreign bank (UBS) that would make a fortune as a result of the awful policy.

But the story made only a minor splash. In the new issue of Newsweek, Mark Hosenball moves the ball forward.

UBS has recently written off huge losses in subprime-mortgage-based securities, and last week liberal bloggers noted that Gramm was a registered UBS lobbyist on mortgage-securities issues until at least December 2007.

NEWSWEEK has learned that UBS is also currently the focus of congressional and Justice Department investigations into schemes that allegedly enabled wealthy Americans to evade income taxes by stashing their money in overseas havens, according to several law-enforcement and banking officials in both the United States and Europe, who all asked for anonymity when discussing ongoing investigations. In April, UBS withdrew Gramm’s lobbying registration, but one of his former congressional aides, John Savercool, is still registered to lobby legislators for UBS on numerous issues, including a bill cosponsored by Sen. Barack Obama that would crack down on foreign tax havens. “UBS is treating these investigations with the utmost seriousness and has committed substantial resources to cooperate,” a UBS spokesman told NEWSWEEK, adding that Gramm was deregistered as a lobbyist because he spends less than 20 percent of his time on such activity. Hazelbaker said the McCain campaign “will not comment on the details … of ongoing investigations and legal charges not yet proved in court.”

Wait, it gets worse.

Newsweek added:

McCain’s campaign is already distancing itself from some of Gramm’s other work for UBS: his involvement in attempts to sell financial products known as “death bonds,” which BusinessWeek described last summer as one of “the most macabre investment scheme[s] ever devised by Wall Street.”

Not long after joining UBS, the Houston Chronicle reported, Gramm helped lobby Texas officials, including Gov. Rick Perry, to sign on to a UBS proposal in which revenue would be generated for a state teachers’ retirement fund by selling bonds, whose proceeds would in turn be used to buy annuities and life-insurance policies on retired teachers. UBS would advance money to the retirement fund, then repay itself, compensate bondholders and pocket profits when insurance companies paid off on retirees who died. According to a banking-industry source, who asked for anonymity when discussing a sensitive matter, Gramm was involved in efforts to pitch similar UBS products to other financial institutions.

McCain’s campaign didn’t want to talk about this, and Gramm’s office “declined” a request for comment. I can’t say I blame them.

Remember when McCain used to talk about high ethical standards? It seems like quite a while (and several high-priced corporate lobbyists) ago.

Even still, this is just the tip of the GOP ghoulish iceburg. If this situation were ever mirrored in, oh let’s say the Bill Clinton Whitehouse, there’d be months of neocon talking points blaring from TV, and a 20Million tax payer-funded investigation, and ultimately some hack would serve time. But this is God’s party, so it must be okay. This is Senator Graham’s way of fighting communism and gay marraige. And buying an ocean front condo in Key Largo.

  • Remember when McCain used to talk about high ethical standards? It seems like quite a while (and several high-priced corporate lobbyists) ago.

    Maybe it was always just talk, and is just now drawing scrutiny?

    McCain, Have you mavericked this week?
    Were you available to maverick this week?
    Did you turn down any opportunities to maverick?
    If you did maverick, who did you maverick for and where did you maverick.
    Your continued status as a maverick depends on your looking for mavericking.

  • McCain wanted to talk about high ethical standards—until he discovered that talking about “high ethical standards” would, of course, shine the Light of Truth on his “low ethical/no ethical standards.”

    Mr Straight Talk? He almost had it right. McCain is really Mr. Straight-Jacket Talk. Any discourse not of his liking must be bound, gagged, and thrown into a soundproof, padded dungeon cell. He has learned well from his former masters—both in the WH, and in Hanoi. Truly, he is “the Manchurian Candidate.”

    Only in Bushylvania….

  • Dale (#2 above)-

    I suggest that you be more specific. In order for McCain to maintain his status as a maverick, he should be required to spend at least 20% of his workweek mavericking.

  • We can move mcCain’s economic policies with Gramm from “voodoo economics” to “wacko economics.” Which fits perfectly, since everything else in Grampy’s campaign is “wacko” – wacko foreign policy, wacko environmental policy, wacko military policy, etc., etc.

    What is it in Arizona? You get lunatics like Barry Goldwater and McCain, and halfwit con artists like all their other businessmen and politicians (with a few notable exceptions)???? Is it in the water? Too much sun? Being bitten by a gila monster at an early age?

  • ’d hoped, in vain, that Phil Gramm’s role in the McCain campaign — which became a more serious issue this week — would generate a bit more media attention than it has.

    I keep telling you that the MSM is all essentially a Republican front. They aren’t going to push hard on any story that reflects badly on McCain. Until we do something about the highly concentrated ownership of supposedly neutral news organizations, nothing will change on this front.

    “Journalists” are simply the spear-carriers whose missions are 1. to make profits for the media companies they work for, and 2. to advance political views that are congruent with the interests of the media companies’ wealthy owners. Informing the public and/or getting to the truth are afterthoughts at best.

  • A couple days ago, McCain cancelled events in PA because of “a minor cold”. Yesterday he made an unexpected visit to Walter Reed Hospital (no cameras). Could it be that Gramm, Black, Davis, Iraq gaffes, and the GI bill are giving Reps buyers’ remorse? I wouldn’t put too much money on him winning at the Rep convention at this point. Of course, he would probably have to drop out willingly, though extortion is always an option for his colleagues. But that minor cold could develop into a reasonable excuse.

  • Is it me, or has John McCain come to look more and more like a confused, angry, aging Elmer Fudd? The GOP just wants so badly to kill the wabbit. Well, of course we know this means war . . .

  • Danp said: I wouldn’t put too much money on him winning at the Rep convention at this point. Of course, he would probably have to drop out willingly, though extortion is always an option for his colleagues. But that minor cold could develop into a reasonable excuse.

    Now that’s interesting. Who do you think he might be replaced with? Do the Reps havie any Gore-level game-changers that could recruit?

  • Dale, you seem to have overlooked the insurgent Mr. Paul, who is still an active candidate with a clear agenda and a notably large and passionate cadre of supporters who plan on monkey-wrenching the GOP convention as best they can. Not that I think he’s electable. Just sayin’.

  • Once again, a thread about McCain and none of the Clinton trolls show up. It’s only about Clinton for them, not the Democratic Party and progressive politics in general.

  • Dale (9): Do the Reps have any Gore-level gamechangers?

    Not that I know of, but at this point the biggest asset would be anonymity, don’t you think?

  • I can guest troll, if that will help:

    “Obama can’t win and anybody who ignores that is obviously a member of the media and majority of the Democratic electorate who have issues with a female candidate.

    FREE MICHIGAN!!!!”

  • Since when has anyone considered the Clintons “progressive”? If you’d vote for McCain merely to spite Obama you are clearly a Rebublican. Yes, that’s a “b.”

  • Wow, that Senator McBush is a ROCK.

    When you flip it over, all the slimy bugs under it scurry for cover.

  • The problem of tying too much of this to Gramm is that Gramm can be kicked out of the McCain campaign. But he will still be a Republican, he has already shaped McCain’s economic policy, we can assume that he will be part of the Republican party for the next eight years.

    Regardless of if or when Gramm exits the campaign, the rational response is to keep McCain on the defensive by tying the McCain economic policies to Gramm each time they are mentioned. So now we have the McCain/Gramm economic agenda. Or we have Gramm is McCain’s economic brain. Or Gramm is McCain’s economic brain trust. Whatever.

  • If anyone questioned whether McCain is just another Bush, all they have to do is read this article to realize the same sh*t has already begun. They “won’t comment on an ongoing investigation”? Now where have I heard that before? Isn’t that the Republican mantra?

  • If charges were to be brought against McClain for campaign violations, financial or otherwise, what would happen? There is nothing this man could do that would make the press speak harshly of him. He depends no them to explain what he really meant or to explain away his mistakes. But I expect that most people have quit listening to the press and to McCain for that matter as both have been totally misleading for years now.

    This should be a really big public issue. All the lobbyists he didn’t want are running his campaign and even they cannot help what comes out of McCain’s mouth. How come the Times and the Post aren’t running with this?
    Are we to find out next that former Exxon lobbyists are in charge of McCain’s energy policies? The special interests groups candidate…John McCain.

  • “Newsweek has learned …”??!!

    Maybe from reading the Financial Times??

    I know Americans tend to be skeptical that foreign countries actually exist, but since when is it an act of pathbreaking investigative journalism to read a frigging foreign English-language newspaper???

  • Romney and Huckabee never officially withdrew from the primary.

    McCain seems to produce something substantially stupid about once a week, he will not commit to a policy or a position, and he can not remember what he sai 10 mins. ago. I think this is half the reason the D’s are letting the primary get so ridiculous. Our primary process needs change and what better year to demonstrate our arcane primary process.

    With all the HRC vs Obama self destructive non-sense, they both are ahead of McCain almost everywhere. If our candidate was already locked in, we would be killing McCain. I think the D’s are going to win by a margin to large to negate with even the most heinous vote stealing schemes. And that ‘my friends’ is the only way McCain will every be president.

  • I’ve been predicting that McCain will drop out for months now. (I’d guess they’d turn to Gingrich.) In fact, I even predicted that it would happen by July 18th — don’t ask why I picked the date. It just seemed about the right time.

    Yes, whoever the Republicans turn to, the Democrats will win an incredible victory this year, big enough that, if Obama’s first two years are even moderately successful, the Republican Party might self-destruct after 2010.

  • Isn’t UBS the same company that bought the Enron leftovers? Why, yes, I think they are. Wasn’t UBS PaineWebber, a subsidiary of UBS Warburg, in charge of Enron’s employee stock options? Why, yes, I think they were. Wasn’t Gramm’s wife, Wendy, a director at Enron who sat on the committee overseeing Enron’s audits? Why, yes, I think she was.

    So McSame has been getting economic advice from a guy who helped Enron rob the West Coast and undermined the transparency of the entire US marketplace. And Gramm, who was a VP at UBS and lobbied for them until April 2008, is advising McSame on crafting economic policies in which UBS and Gramm have an interest.

  • Death bonds? Ah, so that’s what the GOPers mean when they pretend to be the “party of life”.

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