Planes, Trains, And Automobiles (And Boats!) – The Corruption Of The Political Class

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Definition of corruption – impairment of integrity, virtue, or moral principle

Given the recent rampant and disgraceful behavior of the American political class in various situations, the above descritpive definition seems appropriate. These situations are so varied, and yet so common to our politicians, that they reminded me of the 1987 movie featuring John Candy and Steven Martin, “Planes, Trains, and Automobiles.”

In that movie, Candy and Martin, two completely different personalities end up on a cross country trip of misadventures, both trying to get home to Chicago for the holidays. Their misadventures  include various disasters on planes, trains, and automobiles. Their plight reminds me of the corruption trip of our politicians that also includes plans, trains, and automobiles with an additional misadventure into boats. All of which fulfill my above definition of corruption, the impairment of integrity, virtue, or moral principle.

Planes

The “planes” political crisis of corruption and impairment of integrity comes from earlier this year. It involves Democratic Senator Claire McCaskill of Missouri. In late March, 2011, she announced she was selling her private plane and paying the owed back property taxes on it of over $287,000. Apparently in Missouri, an airplane owner has to pay property taxes on any plane that they own, something that the Senator did not do.

But that is not her only potential integrity problem. First, according to Politico articles from earlier this year, she also had to write a check to the Federal government when she billed her Senate expense account for purely political trips she made using the plane.  This cost her to refund over $80,000 to the government.

Second, the plane is registered to a shell company that is registered as an LLC in the state of Delaware, a state that does not charge property taxes on private plans. Was this an attempt to shelter the plane from Missouri property taxes? Given that the Senator lives in Missouri, is a Senator from the state of Missouri, used to work for the state government of Missouri, and keeps the plane in a hangar in Missouri, it certainly gets suspicious when her plane gets registered in Delaware.

Finally, the Senator served as the state of Missouri auditor from 1999 to 2007 so claiming ignorance of the state laws on property taxes is not a viable defense. Makes you wonder how a smart, educated, politically savy individual could forget or neglect to pay over a quarter of a million dollars of property taxes. Corruption or incompetence, neither being a good adjective to describe a U.S. Senator.

In a final bit of irony, earlier in 2011, McCaskill signed on as a co-sponsor of Senate legislation that would fire Federal employees if they are “seriously delinquent” in paying their own Federal taxes. Looks like maybe we can add hypocrite onto the charges of incompetent or corrupt.

Trains

Reuters reported on October 27, 2011 that Federal authorities arrested and charged eleven people in connection with an alleged $1 billion fraud involving hundreds of railroad workers from the Long Island Railroad filing false disability claims. Some of the workers claimed that they were unable to work even though investigators found them playing golf, playing tennis, riding bikes, shoveling snow, and doing other strenuous activities.

Among those arrested were several doctors who participated in the scam. The doctors would write up false medical reports stating that the railroad employees were disabled and when the employees were approved for disability payments and disability retirements, the doctors got a kickback from the newly “disabled” employees.

How does the political class figure into this? Consider the following:

 

  • This fraud has been going on for years and years, even before the New York Times reported on it back in 2008. Why was it not handled sooner by the New York political class? One billion dollars is a lot of money to lose, one would have thought it would have been visible much sooner.
  • The Reuters report stated that just about every long time Long Island Railroad employee was on disability, far higher than other railroads. Thus, this should have been another glaring red light for those in charge of protecting taxpayer wealth and assets. If, as the New York Times reported, “almost every longtime LIRR employee was receiving disability payments, resulting in a disability rate sharply higher than other railroads,” why was the political class so delinquent in its duties to punish the fraud?
  • Finally, in the two examples cited in the Reuters article, both persons were receiving well over $100,000 a year in disability payments. Even if these were legitimate disability cases, why were the payments so high, almost double the average household income level of the average American household.

Thus, not only were the politicians delinquent and irresponsible in identifying the massive, $1 billion fraud, they were also irresponsible in allowing disability payments to be so out of whack with the reality of life in America.

Definitely impairment here, allowing a disability system to be so corrupt and wasteful of taxpayer wealth.

Automobiles

You have to love the Obama administration’s Energy Department and their ability to constantly throw good money after bad when it comes to “green companies.” The latest waste comes to us courtesy of ECOtality. ECOtality is another California based green company (why do all of the Obama administration’s alternative energy failures seem to be in California?) that received another Federal government backed loan, this one valued at $115 million.

The objective of ECOtality was to install 14,000 plug in charging stations in 18 cities around the country so that consumers with electric vehicles could pull up and juice up their electric car batteries in a convenient, local manner.

However, things have not gone well, even though the company was mentioned in the President’s state of the union message and touted by the head of the Energy Department, Steven Chu:
 

  • The SEC has recently opened an investigation into the company related to insider trading.
  • In the first six months of 2011, the company lost $12 million, $3 million more than the year before.
  • Half of its first quarter income came from the Federal loan, not from operating or sales success, implying the financial losses were worse than $12 million from an operating perspective.
  • The installation is behind schedule and the company may be asking for an extension to their original installation timeline.

It is hard to believe that the company was to install 14,000 charging stations for a market that probably has no where close to 14,000 electric vehicles on the road. The logic is illogical. Even if all 14,000 were installed, how was anyone going to make money off of them?

How corrupt and non virtuous is your thought process for no one in government or the political class to understand how poorly this math works out: build out infrastructure across the company to the tune of 14,000 stations to handle a market size that is far less than 14,000 users of the 14,000 charging stations?  The corruption of their thought process makes your head spin.

Boats

Although Candy and Martin did not involve a boat in their travels to Chicago in the movie, the political class, as usual, goes one step further when it comes to corruption and impairment of integrity. We reported on this incident a while ago but it is worthwhile going over it again, given the them for this post.

John Kerry is a U.S. Senator from the state of Massachusetts. He lives in Massachusetts and serves the state of Massachusetts. The Senator is one of the wealthiest people serving in Congress since he married into the Heniz family fortune, probably easily worth hundreds of billions of dollars.

However, as reported by the Associated Press in July, 2010, the Senator seemed to have had a little integrity and moral impairment back in the time frame when he purchased a new yacht worth about $7 million. Rather than berth it and maintain it in Massachusetts, he took the New Zealand built boat across the way to Rhode Island where he would not have to pay both Massachusetts sales tax and annual Massachusetts excise taxes.

These are not trivial sums. The Associated Press report estimated that the home state of the U.S. Senator was missing out on $437,500 in one time sales taxes and $70,000 a year in excise taxes. I would say this corruption puts him in the same class, using the same cheat-my-home-state out of legally due taxes, as the good Senator from Missouri did with her aiplane registration in Delaware misadventure.  Just another instance of political corruption, a major impairment of integrity, virtue or moral principle.

The good thing about the movie is that it was funny and the misadventures were happening to someone else. The unfortunate thing about political class version of “Planes, Trains, and Automobiles (and Boats),” is the the misadventures happen to the taxpayers and the associated waste of taxpayer wealth. There is nothing funny about that.

This type of behavior needs to stop, it is a disgrace to the country and a waste of money that could be used for some many other good purposes. Two steps are needed to get this situaiont under control. 

The first step would require every politician to sign off on a shared value statement every year of which integrity would be a prime component. Hopefully, if they at least read and sign off on the promise to remain in integrity, we would have a chance of seeing behavior that does not remind us of  the political misadventures of “Planes, Trains and Automobiles.”

The second step would impose term limits on every Federal government politician. We have to find a way to reform our political processes so that we get people into elected office that want to serve us, the citizens, rather than how can they improperly use government resources to keep themselves in office or use their position and knowledge of the system to avoid paying the taxes they rightfully owe.

Integrity, virtue and moral principle. Wouldn’t that be a nice way to describe our politicians and leaders? It is certainly not the case today and that makes for a very sad movie ending.
 

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