Why the Oil Bubble of 2006-8 Isn't Being Investigated or Prosecuted
On Thursday, June 14, 1990, the Democrats had a big one.
The party had enjoyed headlines the week before. The top stories told how leading Democrats, such as Senator Bill Bradley and New York Governor Mario Cuomo, were winning political points by labeling the savings and loan crisis the fault of the Republicans. That Thursday, after discussing an appropriations bill and the politics of the constitutional amendment on flag burning, the talk at the Whip meeting turned to the savings and loan crisis.
But despite the success of Bradley and Cuomo, concern was voiced that the "S&L crisis is going to engulf the Congress". The Speaker warned, "There will be an attempt to personalize and make this an anti-Democratic issue in the fall election."
Rep. Byron Dorgan, a tough populist from North Dakota, argued that the party was allowing a Republican failure to become a Democratic liability. Other members made the point that the Democrats should "nail the Republicans and bring Neil Bush back to the witness panel." Tempers were rising as Speaker Foley entered the fray.
But instead of agreeing to help the party score partisan points against the Republicans—or even search out the truth—Speaker Foley darkly reminded the activists that "any congressional investigation will allow the Republicans to call witnesses." He pointed out that the Justice Department indictment the previous day of Texas S&L operator Donald R. Dixon of Vernon Savings and Loan included illegal congressional campaign contributions. Foley also knew that the indictment named Rep. Jim Chapman (D-TX), an Appropriations Committee member and leadership supporter, as a recipient of those contributions. Dixon had also been on intimate terms with former Majority Whip Tony Coelho, evoking pictures of Coelho's money machine at the Democratic Congressional Campaign Committee; it would be dangerous to encourage any digging into that particular black hole.
"We will not be able to avoid being called into this imbroglio," Foley warned. "The record will include both sides of the political aisle. Those calling for a special investigation like Iran-contra should remember that Iran-contra was only a question of the action of a Republican president and his staff."
In case anyone missed the point, Foley stated directly, "The S&L crisis affects both parties."
Any chance of a blue-ribbon congressional investigation into the S&L crisis had been killed. Already, Donald Dixon alone had been found responsible for losses of $1.3 billion, the tip of the iceberg in a disaster estimated by the party's own Democratic Congressional Campaign Committee (DCCC) to cost from $300 to $500 billion. Even the administration, which tended to downplay the numbers, estimated in June 1990 that the cost would go beyond $132 billion. Foley's argument that the political price was too high nevertheless won; there were too many dirty fingers, too many marked decks, too many ugly things were waiting to scurry out from under too many rocks. Foley had said, in effect, the price is us.
John Jackley, Hill Rat (1992)
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Keywords: corruption, economic warfare, espionage, International Military Tribunal, justice, plutocracy, propaganda, pseudojournalism, sabotage, subversion