During a rather abruptly organized press conference last Sunday, Gov. Malloy revealed that 800 of the 23,000 people who obtained federal disaster aid, following Tropical Storm Irene, were state employees, some of whom may actually qualify for the assistance. Thus far, 24 state employees appear to have fraudulently qualified for the disaster aid.

Andrew McDonald, the governor’s chief counsel, said, “We have credible information to suspect that many state employees who received the benefits did so by materially misrepresenting important information included in their applications” for food stamp benefits.”

Those who applied for the disaster funds, known as D-SNAP, received debit cards for as much as $1200, to replace food that had reportedly spoiled due to lack of electrical power during the period following the storm.

As was reported here on September 29, 2011, thousands of people waited in lines for days in the wake of Tropical Storm Irene, in front of Connecticut’s DSS buildings, some of them obtaining emergency funds even though they lived in areas, such as the capital city of Hartford, which had not lost power as a result of the storm. The state administered the $12.4 million in disaster aid funded by the federal government.

The ease with which many were able to obtain D-SNAP funds was discussed anecdotally on local radio talk shows. The chaotic hordes of people lining up to receive D-SNAP funds led conservative Republican state Sen. Joseph Markley to approach the state auditors and ask them to look into the situation. On a talk radio program, Sen. Markley said, “I think, during the course of their investigation, they started turning over some rocks, and it became obvious that there was wrongdoing involved, and some embarrassment. And I believe that’s what led the governor to get out ahead of the story, holding this extraordinary press conference on a Sunday afternoon.”

Officials in Gov. Malloy’s administration indicated that the alleged fraud was committed by state employees who underreported their income in their applications for the funds. They also said that irregularities were discovered by staff of the state’s DSS department.

Mr. Malloy complimented the commissioner of DSS for the discovery, as did the U. S. Department of Agriculture spokesman, Aaron Lavallee, who remarked that the discovery of the alleged fraud was evidence of adequate safeguards, not lax oversight.

“This nutrition assistance program is designed as a rapid response to families in need, and it includes important system controls to safeguard taxpayer dollars,” Lavallee said. “The safeguards in place worked, and we will continue to support the state to make sure the program is targeted towards those families who need it the most.”

The D-SNAP program “worked?” Not according to state House Minority Leader, Republican Lawrence Cafero, who said, “Remember, this is the same state agency that was giving checks to dead people.”

Rep. Cafero expressed confusion about why the state does not improve its income verification procedures. “Why not ask people to bring in a pay stub?” he asked.

But, Connecticut’s DSS Commissioner, Roderick Bremby, responded that the federal government does not require income verification.

Sound just like stereotypic government bureaucracy? According to “stated” D-SNAP rules, in Connecticut, applicants must have met financial criteria to qualify for the assistance. Take-home income and liquid assets for the period from Aug. 27 to Sept. 25 could not exceed $2,186 for a single person; $2,847 for a household of two; $3,272 for a household of three; $3,859 for a household of four; $4,254 for a household of five; $4,753 for a household of six; $5,116 for a household of seven; and $5,479 for a household of eight.

So, DSS sets up the rules, but are the rules just “for show,” to taxpayers, perhaps, who are footing the bill? Commissioner Bremby confirms, indeed, that the federal government does not require income verification when it comes time to dole out the money. And the state of Connecticut, according to the governor’s legal counsel, is expected to go along with that procedure.

Apparently, the system really isn’t “working.” According to Connecticut’s WTNH News, an unnamed source, but reportedly someone who has worked for DSS for many years, has charged that the state’s DSS department has been ignoring fraud for years because of staffing shortages. While Commissioner Bremby has denied knowledge of any other fraud in DSS programs, this individual has stated that the suspected fraud in the D-SNAP program is just the tip of the iceberg. Regarding this program, the individual indicated that DSS employees were told to approve everyone. “The interviewers were told to accept the documentation, however small it was, that they were given, and process the request for the card.” The source said that people have been fraudulently receiving funds for years, while the agency looks the other way.

Asked by WTNH how much money might be involved in the alleged fraud, the source said, “There’s got to be millions of dollars involved.”

Despite this report, Gov. Malloy said he was unsure if he would review those non-state employees who obtained the D-SNAP funds, i.e., the hordes of people waiting in line to receive taxpayer money, whether they lost power or not.

Yes, Gov. Malloy’s administration sure sounds committed to rooting out fraud in the Department of Social Services. They’ll hammer a bunch of state employees, act morally outraged, and put on a good show; but they’ll turn their heads and go about their business when asked to review the myriad of other cases who likely didn’t qualify for assistance either. Nothing new here.

Citizens and states might sue the EPA for overregulation of an industry that could lead to lost jobs and revenues.  Green groups might sue the EPA because they feel it hasn’t done enough to over-regulate businesses or to expand enforcement of current environmental laws.

But it is important to note that in many cases the EPA and Treasury Department are required to award attorney’s fees to those plaintiffs that successfully dispute the EPA.  And because the Justice Department is what defends the EPA in court cases, your tax dollars are what are used to pay the opposing sides’ attorneys.

Facts on just how much taxpayer money is spent on these environmental court cases and who benefits wasn’t well known until Senators Jim Inhofe, R-Okla., and David Vitter, R-La., and a report from the Government Accountability Office (GAO), shed some light on the subject.

The GAO report found that in addition to attorney’s fees awarded, the Justice Department spent at least $43 million in taxpayer dollars defending EPA in court from 1998 to 2010.  That doesn’t include the fact that Treasury paid about $14.2 million from fiscal year 2003 through 2010 and the EPA paid approximately $1.4 million from fiscal year 2006 through 2010.

Because most people don’t have millions of dollars on hand to sue the EPA if need be, these statutes were put into place so citizens and industries could afford to bring charges against the federal government.  However, less than 20 percent of awarded money has been given to private industries, citizens, state agencies and associations combined.  This begs the question, what were the largest beneficiaries of these payouts?

The three primary beneficiaries from 1998 to 2010 were: Sierra Club, Earthjustice and Natural Resources Defense Council (NRDC).  Total amounts these organizations received from all attorney fees paid to EPA litigants combined was at least 41 percent of the total payouts.  Earthjustice alone received 32 percent, as indicated by this report.

Go figure that the primary beneficiaries of statutes set to protect citizens and private industries would instead be awarded to environmental groups that want nothing more than to extend the power and grasp of the federal government’s EPA.

“These statutes aren’t in place to protect clean air or water,  but used to stop everything productive: growth, jobs, projects,” says Thomas Pyle, president of Institute for Energy Research (IER).  “The system has been misguided and this is not the way these statutes were intended to play out.  They are outdated and causing more harm than good.”

Even more striking was the payout to all environmental groups (ENGOs), which in total was 82 percent.

A press release from Sen. Vitter’s office claims that in 2008 alone, the NRDC received $3.5 million in taxpayer money “as it pursued litigation that would imperil the jobs of tens of thousands of energy industry employees in Louisiana alone.”

What may be worse is there is almost no accountability or transparency in how the judgment funds are dispersed.  For example, the GAO could only provide the Senators with data from recent years, rather than the past 15 years, as they requested.

Also, the GAO report stated that the government may also incur other costs associated with litigation, including the costs of revising regulations in response to lawsuits, EPA overhead costs, and costs associated with delays in EPA permitting, but did not have reliable data to quantify these costs.

Taxpayer money has no business going towards furthering the goals of environmental groups, and unfortunately, even in light of this report, Justice Department officials have no plans to make the payout process more transparent or responsible.

“It is not a coincidence that these lawsuits get settled,” Pyle says.  “Through this they achieve most of, if not all, what the EPA was trying to accomplish in the first place.”

If organizations like NRDC, which had a reported $181,427,464 in net assets in 2009, want to sue the EPA, it should do so with its own funds, not those of the taxpayer.  It makes little sense to reward environmental groups with taxpayer money to file lawsuits directed at putting taxpayers out of work.

Rebekah Rast is a contributing editor to Americans for Limited Government (ALG) and NetRightDaily.com.  You can follow her on twitter at @RebekahRast.

Unlike much of the media, we actually spent a considerable amount of time looking behind the press releases to see what GM’s numbers really say about the health of a company taxpayers now own.

This week, we will be sharing with readers a more realistic picture of the company’s health.  The bottom line:  The picture is far less rosy than GM would like you to believe.

1. GM’s Share Price:  Will taxpayers ever be made whole?

Remember these promises?

• “Recent progress at GM gives reason for optimism that it may be possible for taxpayers to get every penny back.” – Steve Rattner, Presidential Task Force on the Auto Industry (11/18/2010)
• “American taxpayers are now positioned to recover more than my administration invested in GM.” – President Barack Obama (11/18/2010)
• “The government’s investment is well placed, and I think they’ll make a lot of money.” – Former GM CEO Ed Whitacre (11/18/2010)

GM’s share price closed below its $33 IPO price for the first time on March 1st.  The company has underperformed the S&P 500 by 15% since the beginning of the year.  The Middle East is in turmoil and gas prices are skyrocketing.  Not a good harbinger for GM’s share price.

Now the Feds say that they want to get out of their GM position as soon as possible. Their first opportunity to do so will be when the government’s “lockup period” ends in May.

But according to the House Oversight Panel’s January update on TARP and the auto industry, for U.S. taxpayers just to break even on the government’s historic $50 billion “investment”, GM shares will need to trade at $54.28 — a whopping 65% premium over GM’s March 1^st closing price.

From the November IPO to the March 1^st close, GM’s shares have been range bound between roughly $34 and $39 per share.  Does anyone really believe that we will see a 65% explosion to the upside for GM shares in the next several months?  How about in the next year?  Two years?

The fact is that it is increasingly unlikely GM will ever pay back the taxpayers.  So why are we pretending this is anything other than a likely taxpayer loss?

Tomorrow, I will begin to show you what else GM is doing with its bailout money.

Today, Carla is fighting back.

This morning, Carla asked a Texas appeals court to dismiss a defamation lawsuit filed against here by a developer involved in the Texas case.

Some background:

The Texas developer behind this abuse project is H. Walker Royall.  As the video makes clear, millions of taxpayer dollars later, the project is now an epic debacle.

According to the Wall Street Journal:

In March 2002, a group of private investors, led by a man named H. Walker Royall, formed a company called Freeport Waterfront Properties. Six months later, consultants hired by the city released a redevelopment plan — and, amazingly, it recommended a private marina, just what Mr. Royall’s investors had hoped for. The city did not open the marina project to competition; it just handed it over to Freeport Waterfront. Conveniently, Mr. Royall sat on the board of Sun Resorts, another company that the city selected, also without competition, this time to manage the marina once it was built.

The cozy arrangements didn’t stop there. Freeport agreed to give the private investors $6 million in the form of a no-recourse loan. . . . The only obstacle to this sweetheart deal was Western Seafood. It owned the land where Mr. Royall and his friends wanted to build. The city came up with a clever way around this problem. Claiming eminent domain, it proposed to take only part of the company’s land. . . . The tale gets worse.

Carla’s book gives an accurate and fascinating account of what happened in Freeport, Texas. If successful, the lawsuit against here could permanently ban Bulldozed from further printing and distribution.  [The book is available on amazon here.]

Carla summed this up at Real Clear Politics:

Royall has picked on the most vulnerable people he could find–writers, a scholar, a nonprofit publisher and a community newspaper. He didn’t sue more powerful venues, such as The Wall Street Journal, which favorably reviewed “Bulldozed,” or the Cato Institute’s Regulation magazine, which have the resources and the lawyers to defend themselves.

In the schoolyard, someone who acts like Royall is called a bully. We are grateful for friends, including the public interest advocacy organization the Institute for Justice, who have rallied to our side to represent us. In this latest misadventure unleashed by Kelo, what is at stake are not only property rights, but intellectual freedom and the First Amendment. It’s a battle worth fighting.

The Institute for Justice, the nation’s leading legal advocate for liberty, fights for victims like Carla Main all across the country. Today, we appeared in the Dallas courtroom beside Carla, asking a panel of judges to put an end to the lawsuit against her.

According to IJ Senior Attorney Dana Berliner:

Eminent domain for private development is the subject of nationwide public debate.  If Walker Royall doesn’t want anyone to talk about him or his development deals, he shouldn’t enter into deals that involve a city condemning his neighbor’s property.

Simply put, private developers shouldn’t be able to bulldoze private property.  And the victims of such abuse, and those who talk about it, should never be silenced.

Click here for more on the lawsuit. The Institute for Justice is also online at facebook, You Tube and twitter.

The latest, most recent example of the careful balance that appears to be falling toward padding special interests over responsibility is the recently-issued draft Request for Proposals (RFP) from the Department of Health and Human Services (HHS) entitled, “Establishing Centers of Innovation for Advanced Development and Manufacturing (ADM) as Public – Private Partnerships.”

Capitol Confidential has learned that this draft RFP is the first step by the Obama Administration to develop and build a national vaccine center with a projected cost of at least one billion dollars.

After the influenza pandemic last year it is fair to question whether the Federal government should take on more responsibility in the area of vaccine production and distribution particularly since there is a vibrant and competitive industry in the private sector, but the real questions here are why is this happening now and who stands to benefit?

We must recall during the presidential campaign, Candidate Obama told voters over and over again that he would change the way business is done in the nation’s capital.  His administration would end the pay to play, special favors, cut off the special interests and shutter the revolving door.  It was a central part of his argument: lobbyists and special interests have corrupted the process and they would have no place in an Obama Administration.

Fast forward almost two years, and we find ourselves in a situation where lobbyists, former and current administration officials, special interests and the corrupting influences have positioned themselves to haul in nearly one billion in taxpayer dollars in what could be one of the most lucrative government payoffs in history and, most disgracefully, they are doing it in a critical area of national and public health security.

If the Obama plan is implemented in its current form, this so-called “Center of Innovation” most likely would be located at the University of Pittsburgh Medical Center (UPMC).  With all the research centers and universities across the country, how does UPMC – with absolutely no strong biotechnology pedigree – have a leg up on everyone?

Well, it starts with the fact that deceased Congressman John Murtha, along with outgoing Senator Arlen Specter, were knee deep in pushing UPMC for this very project and worked behind the scenes to establish an entire enterprise of lobbyists, third party organizations and administration nominees to achieve one end: get this facility built in Pennsylvania so they and their friends could enjoy the payout.

Specter, for his part, took his Senate Committee on the road in August 2009 to do a field hearing – in Pittsburgh no less – in support of the facility, using taxpayer dollars to fund the junket and packing the panel with members of the UPMC team.

Remarkably, during that hearing, HHS’ top vaccine expert, Dr. Bruce Gellin, director of the National Vaccine Policy Office, blasted the very plan HHS is now proposing at UPMC’s urging, saying, “Of all alternatives examined, the [multi-product facility] potentially has the highest risk of supply chain failure and, compared to the two other alternatives, carries the highest cost.  In addition, the time required to develop reliable systems for long-term, full scale manufacture of biologics (large molecules) could impede progress toward needed FDA approval.”

Yet, the Murtha/Specter/UPMC plan clearly has influenced HHS’s thinking.

To prove those points, take note of the following facts:

As has been reported, Murtha directed the Defense Advanced Research Projects Agency (DARPA) to give UPMC three million dollars to draft a report concerning “Advanced Development and Manufacturing Capability for the United States Government.”  And even though the report contains numerous factual inaccuracies and errors, it is now the baseline for the billion dollar award and has placed the Pittsburgh university in a leading position.

Secondly, a natural follow up would be, who worked on the report?

Current Department of Homeland Security (DHS) Undersecretary for Science and Technology Tara O’Toole was an advisor on the UPMC report and project.  Previously, before entering DHS through the wide open revolving door, she led the Center for Biosecurity, which is connected with UPMC and is tied into an underground network of third party organizations and lobbying efforts, which is tied to and donated heavily to Murtha.  In spite of being questioned extensively during her nomination hearings about conflicts of interest due to her relationships with Murtha and his affiliated groups, O’Toole now is in a position to deliver the payback some of these folks have been working toward for nearly a decade.

The Washington Times recently reported, “President Obama’s nominee at the Department of Homeland Security overseeing bioterrorism defense has served as a key adviser for a lobbying group funded by the pharmaceutical industry that has asked the government to spend more money for anthrax vaccines and biodefense research.”

Third, who are some of the third-party groups that have both worked on the DARPA report and lobbied on behalf of the project?

One major player comes to mind, PharmAthene.  This is a company that is comprised almost exclusively of Murtha cronies, has a long track record with O’Toole and UPMC, and has been built for one purpose: to be the conduit in the private sector for the payoff.

The company is in dire financial straits nearly being delisted from the New York Stock Exchange andbeing slapped by the U.S. Food & Drug Administration for making false allegations about one of its products.

PharmAthene’s newly minted Chief Scientific Officer, Tom Fuerst is the principle author of the UPMC report.  As has been reported by The Washington Times, Fuerst left the Obama Administration just as O’Toole was entering.  Having been a senior official in the very HHS office that requested the UPMC report and now heading the vaccine facility project, there is a clear line linking government and corporate payback.

But it doesn’t stop there.  The financially floundering PharmAthene, which relies exclusively on government contracts, many of which are awarded on a specious basis, which has been reported by Capitol Confidential, was founded by Joel McCleary, a founding partner at a DC-based private equity firm named Four Seasons Ventures.  Interestingly enough, McClearly was also a named advisor on the UPMC report to DARPA.

McCleary’s partner at Four Seasons is James Ervin, a former aide to Murtha who has lobbied for PharmAthene and still lobbies for UPMC.  To add a little more fuel to the fire, note that Four Seasons is heavily invested in PharmAthene and stands to gain millions when this taxpayer-funded boondoggle is awarded.

And that’s where today’s politics intersects with policymaking and payoffs.

Fox News reported earlier this year, “McCleary and executives at Four Seasons Ventures, LLC, the Georgetown-based private equity and lobbying firm he founded – also one of PharmAthene’s top investors – have collectively given at least $110,000 to various Democratic Party arms and candidates over the last six years. McCleary personally gave $2,300 to then-Sen. Barack Obama’s presidential campaign in November 2007.

“Federal records maintained online by the Center for Responsive Politics (CRP) also show PharmAthene executives contributed nearly $10,000 to Democratic organizations and candidates over the same time period, including $1,200 to the Obama presidential campaign.

“Close scrutiny of CRP’s online records reveals that on the same day – Nov. 6, 2009 – McCleary contributed $4,800 and two PharmAthene executives gave a combined $1,500 to Sen. Tom Harkin, D-Iowa. Harkin is chairman of the Senate Health, Education, Labor, and Pensions Committee, the panel that oversees HHS and its operations.”  He also gave $4,800 to Specter’s failed Democratic primary bid, in addition to another $10,000 to the Democratic Senate Campaign Committee.

No wonder Specter had the field hearing in Pittsburgh in support of the national vaccine facility and packed it full of UPMC team members.

So the promise of “change you can believe in” has turned into a promise of “payoffs and gifts to special interests you can count on.”

Left holding the bad yet again, if this project goes off as planned, the American taxpayer who  will subsidize a massive payout to a black market of lobbyists and third party groups who will enrich themselves on a hugely expensive project that literally came from the pen of a former private sector official who just entered the government (i.e. O’Toole) after being authorized and funded by a government official who just entered the private sector (i.e. Fuerst).

The revolving door is spinning so furiously that one can only hope it hits someone in the ass and soon…

Despite millions in federal tax credits, wind-equipment manufacturers cut thousands of jobs in the U.S. last year

Las Vegas receives $4.5 million federal grant to build the neon museum

Alaska Senators fight to restore funding for earmark that both President Bush and Obama have tried to eliminate

New Jersey Senator prodded the Federal Reserve to aid a struggling bank whose chairman and vice chairman were big campaign contributors

Media critics agree the U.S. Census Bureau’s $2.5 million Super Bowl ad was one of the worst

$501,940 of federal stimulus aid will help finance an animal shelter, which will include pet bathing areas and a kitten nursery

Only 11% of Americans think the government spends taxpayers’ money wisely and 83% say the size of the federal budget deficit is due to the unwillingness of politicians to cut government spending

75% of voters are angry at the government’s current policies; 59% believe cutting taxes is better than increasing government spending for job-creation, but 72% expect Washington politicians to increase spending instead

That leaves 305 members of the House who are silent. If you want to find out whether your Congressman has taken a stand against an organization whose employees are eager to facilitate a child prostitution ring, call the House switchboard at 202-224-3121.

As James O’Keefe noted in his latest post, “Keep on the pressure. Never let up.”

2009-09-15_ACORN_Letter_to_President_Obama-1 –