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The Last Time a Republican Reigned in Big Business - 1903

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Friday, October 12, 2012

BY ANY OTHER NAME



I have often pondered in these pages about the personalities attracted to the art of political science. There are few souls that so hunger for power and attention. There are even fewer egos or ids that can thrive in the organized anarchy that passes for modern democracy. And if every once in a great while the field throws up a skilled dissembler of half truths, it is just as likely to an uncover an occasional preposterous paranoid psychotic. The trick for the voter is identifying which is which before they go on the public payroll. As an abject lesson in spotting the lunatics amongst the loonies, I shall now relate the story of Byron Anthony Looper, a politician, who in the words of his defence counsel, knew how to lose an election. It is a skill more valuable than you might first imagine
He might have been a gentleman by act of Congress, but in 1985, in his third year at the United States Military Academy at West Point, Byron was thrown from a horse and so badly injured his knee, he was given an honorable discharge. Then he might have been a Democrat, thanks to his uncle Max Roach Looper, a state Representative from tiny Dawsonville, Georgia. But Byron lost his first election in 1987, and after three years as a legislative aide, legend has it that he went to Peutro Rico
He claimed to have worked there as an assistant to a university president, but the university does not seem to have existed. And according to Modesta Blansett, who dated him while he was still in Georgia, Byron was a real charmer, except when he drank, which was often. On those occasions he “exhibited a dark, angry temper”. Byron had two traffic tickets for drunk driving in Hall County, Georgia, and in March of 1986 he pleaded “no contest” to a third. In 1987 he picked up another DUI conviction in Atlanta. Then, like many people approaching thirty, Byron felt the need to re-invent himself. So in 1993 he returned home, one hundred miles north as the crow flies, to the 931 area code, to the Cumberland Plateau of central Tennessee.
As a small boy Byron had left Cookeville, the farming and industrial community bisected by Interstate 40, 80 miles east of Nashville and 100 west of Knoxville. But times and circumstances had changed Byron. His “pinstriped oxford cloth and double-breasted suits” and power ties no longer fit in amongst the 24,000 overhaul wearing farmers in the Putnam County capital, nor even with the 11,000 students attending Tennessee Tech, nestled in the center of town. Still, shortly after his arrival, Byron decided to register to run as a Republican against the popular local Democratic state Representative Jere Hargrove.  Mr. Hargrove remembered being puzzled just a few days after Byron had filed his paperwork, when the conservative Democrat received a letter from Byron Looper, seeking help in getting a job with the Farmers Home Administration. Hargrove never responded “because I thought it was crazy.” He remembered the campaign which followed as “dirty”. And for Byron it was unproductive. He lost.
Still, Byron refused to give up. As the Republican county Chairman Scott Ebersole remembered, “He was playing politics all the time.” Byron even took out an ad in the political magazine, “Campaigns & Elections”, seeking the help of a consultant. William Lindsay Adams, based in Louisiana, answered the ad, but found his interview with Byron made him “uncomfortable”. “Byron told him that if a candidate wasn't in the race at the end, it wouldn't cost him very much to win”. Adams quoted Looper as saying it would just be “about 35 cents” – the price of a bullet. Adams stopped answering Bryon's calls.
Then in 1996, Byron found Republican backing for a run against the 14 year Putnam County Tax Assessor, Bill Rippetoe. Their support was understandable, since if elected, Byron would be the first Republican to hold a county wide office in recent memory. Byron took part in no debates, and made no public appearances. But he did run a lot of negative radio ads, claiming that Rippetoe had fixed tax assessments for his friends. There was no evidence for this, of course, but Rippetoe was not prepared to respond. And to prove his philosophy on property taxes, Byron invested $4.95 to legally change his middle name from Anthony to “(Low Tax)” - parentheses included. He did run one positive ad, promising he was “a new kind of leader”, and introducing his wife Terry to the voters. However, Terry Guess was not his wife, but merely his girlfriend, who was also his landlady. He was renting a room in her house. But by the time the truth had come out, Bryon had finally achieved his dream – he won the election by 1,100 votes. And immediately he learned that old lesson about being careful what you wish for.
A week after taking the oath of office, on Thursday, September 12, 1996, Byron called a press conference to announce he had discovered $100 million worth of property taxes had not been paid. But before the reverberations from that headline had reached the farthest corners of Putnam county, from Hanging Limb to Muddy Pond, the County Commission, to which Byron reported, responded that $100 million was the “normal backlog” for property taxes at this time of year. They also suggested that Bryon should just do his job and stop holding press conferences. After further checking, Byron held a press conference to announce they were right. Then he left town – for Peutro Rico.
This time Byron was gone three weeks, which in town the size of Cookeville did not go un-noticed. When he returned he cleaned house, firing dozens of staffers, and hiring a “Security Chief”, who swept the office for listening devices. None were found. He also assigned three employees to photocopy more then 5,000 pages of County Commission records. When this was questioned, he held a press conference to announce he had uncovered “a good ol' boy network” and was suing to make the documents public. This required the Commission to reveal the documents already were public. This time “Low Tax” was forced to issue a written apology. Said County Executive Doug McBroom, “His attitude was that we're all dumb, and he was here to save us...but he kept getting caught.”
At one of his many press conferences, Byron was faced with an allegation that he had fired staffers because they were Democrats. But Byron had a ready answer for that charge. It was preposterous, he said, since he was secretly a Democrat, too. A quick look at the records revealed Byron was telling the truth, he was a registered Democrats. Whereupon, the party had him purged. The Republicans, were perfectly happy to have him as a member since, beggars can't be choosers.
Meanwhile, the work in the Tax Assessor's office became increasingly chaotic. Byron would disappear from the office for days at a time, and when he did show up, he spent time trying to transfer properties to the tax rolls of neighboring counties – specifically properties owned by members of the County Commission who were giving him such a hard time. His new Security Chief got into a fist fight with a voter. Some property owners were charging Byron had “shaken them down” for political contributions. And when they did not contribute, Bryon increased their property tax assessments. Under Byron's stewardship, records had gone missing, and his remaining employees had spent 90 hours working on his next campaign, for the congressional seat held by Democrat Bart Gordon.
His campaign had barley gotten off the ground when in March of 1998, the Tennessee Bureau of Investigation hit Byron with a 14 count indictment for official misconduct, theft of services, misuse of county property and misuse of county employees. In the primary Bryon came in third in a field of four Republicans But the resourceful young man had an ace in the hole. He was the only Republican who had also filed to run against the popular five term State Senator, Tommy Burks . By default Byron made it on the November ballot in that race.
Nobody expected Byron to win, evidently not even Byron. But Tommy Burks had been a politician to long to be over confident. He told a friend, “This Looper boy is absolutely crazy. I believe he's capable of doing anything.” And then in August, another lawsuit was filed against Byron, from an unexpected source. It was filed by Byron's former girlfriend and landlady, Terry Guess. She alleged that in December of 1997, after they had broken up, Byron had assaulted and raped her. And when she ordered him out of her house, he had filed a false transfer of ownership of her home to his name. But Terry's breaking point came when she discovered she was pregnant. Now, with the baby due in a few weeks, she sued Bryron, asking for $1.3 million in damages and child support. Byron did his best to “handle” the suit. He held a press conference. He referred to Terry as “a former stripper”, and complained “She left me with heart palpitations, a small box of memorabilia, and a red G-string.” It was a good line, but it did not help.
But Byron had uncovered a “quirk” in the election laws of Tennessee which he felt certain would bring him victory. Early on the Morning of October 19, 1998, Byron (Low Tax) Looper drove a black sedan onto a unpresuspossing pig and tobacco farm, and stopped next to a pumpkin patch, along side a pick up truck. And then he fired one 9mm round into the skull of State Senator Tommy Burks, killing him instantly.
According to Tennessee law, a candidate who died within 30 days of an election, must have his name removed from the ballot. So Byron figured he would win by default - emphases on "fault". But what Byron had not counted on was that his clever cover up would dissolve so quickly. In a matter of hours the cops were able to show that Byron had bought the sedan in Georgia, resold it there to a dealer a few hours after the murder, and worse, Byron had been recognized at the scene by two of Tommy Burk's farmhands. Plus there was his confession to a childhood friend a few hours later. On election day Byron was in jail, and although he was still the only living candidate on the ballot, Charlotte Burks, Tommy's widow, received 30,252 write in votes against Byron (Low Tax) Looper's 1,531 votes.
Yup – that Byron (Low Tax) Looper. He sure knew how to lose an election. And a court case. He changed lawyers eight times, but in August of 2000, Byron was still convicted of first degree murder, and sentenced to life in prison without the possibility of parole, at the Morgan County Correctional Complex. And that was when he got another name change. He is now known as inmate #323358 . And this one looks like it might stick for awhile
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Wednesday, October 10, 2012

NO EGO IS AN ISLAND


I must begin by telling you there was once a real island in the Chicago River, where Canadian Geese nested. But by 1850 the original Goose Island was gone, and the name had been re-applied to 160 acre man made island, 1.5 miles long and ½ mile wide, created by dredging the North Branch Canal across a bend in the Chicago River. By the 1890's this new island was crowded with soot spewing factories, eleven coal yards, a gas plant, a railroad and four grain elevators, and it had acquired yet another title; “Little Hell”. Through the magic of capitalism, this hell on earth was controlled by one man - Philip Danforth Armour. He was known as the “King of the Meat Packers” (he invented the phrase “we use everything but the squeal”) or “The Old Bull of the Wheat Pit”, while his underpaid employees invented a few other epithets for him. But Armour's faux Goose Island would prove to be his ace in the hole, in a game of capitalist poker.
The player betting against Armour was a 29 year old Harvard educated ego named Joseph Leiter, who would boast that he was a thousand years ahead of his time. And that was unfortunate for him, because at the time, who your father was, was more important than who you were, and Joe was the only son of the fabulously wealthy Levi Leiter. In such a world Joe couldn't lose. And in 1897 the old man went off to Europe, leaving Joe with $1 million to play with (about $25 million today).
That spring Joe stumbled upon the idea of manipulating the price of wheat. It was called “cornering the market”, as in cutting the corner to shorten a trip, the same way the North Branch Canal isolating Goose Island shortened the journey down the river, (while also creating additional docking space for barges bringing in coal and grain) The way this “scalping” was usually done, was by buying futures contracts, Joe would drive up the price, and then, at a time of his own choosing, he would dump them all, catching the other, less well endowed speculators, with their wallets open. It was a game Armour had invented, and often used to inflate his own fortune. Its the way money has traditionally been used to make more money, by manipulating the market. And on April 7th Joe bought his first “contract” for winter wheat at 72 ½ cents a bushel.
That year looked to be a bumper crop for wheat in the upper Midwest, and by June the price for a futures contract in Chicago had fallen to under 65 cents a bushel. But Joe just kept buying. By July the press had realized somebody was trying to finagle a corner on wheat, and the price for wheat futures started to rise again, as others were drawn into the game. By September futures had reached $1.85 a bushel. If he had sold at that moment, Joe would have profited $500,000 ($13 million today). But Joe let it be known he was the genius behind this particular corner, and assured the market, “I don't want your money, but I do want your grain.” The Harvard man wasn't selling out. He was expecting to take delivery. In other words, he had doubled down.
In that instant the guessing shifted from “how is Joe going to pay for all these wheat futures?” to “Where is old man Armour going to get all that wheat?” Because - Armour controlled the wheat market , because he controlled the railroads and the ships that transported it, and the elevators where it was stored. Most of those futures contracts Joe had bought, he had bought from Armour. As of October Armour had signed contracts requiring him to deliver in December to young Joe Leiter,  9 million bushels of wheat which did not then exist in Chicago. If he didn't deliver he would have to pay Joe the price of the contracts. But nobody in Chicago – nobody in the world - had ever seen 9 million bushels of wheat in one place before. With a shudder the financial pundits of Wall Street and the Chicago Board of Trade, realized that Armour had been Joe's target all along. The young genius had cornered the old bull.
Except, this was Armour's own game. A decade earlier, when he just had two grain elevators on Goose Island, Armour had sold 3 million bushels of wheat he did not have. His response was impressive, He hired an army of carpenters. Remembered a local witness, “Anybody who could drive a nail could get a job there. In three shifts they worked day and night.” One month later two new massive grain elevators stood just north of the older two, complete with systems for “turning over” the wheat to keep it from rotting. Now, Armour sprung into action again.
In late November Armour leased, bought or rented every one of the 134 freighters on the Great Lakes and dispatched them all to Duluth, Minnesota. He followed that by a fleet of tugboats to keep the channels ice free. And his railroads were also busy ferrying wheat to Goose Island. On December 19, 1897 Armour delivered the first 1 ½ million bushels, on time. But the ships and trains continued to arrive in Chicago, and it seemed Armour could not afford to continue this game for long.
At first Joe shipped his wheat to the east coast markets and sold it as quickly as he could. But that merely opened more space on Goose Island, making Armour's task easier, while driving down the price in the east. Besides, the eastern elevators were not equipped to handle a full season's harvest. So Joe decided to accept the wheat, but let it stay where it was. And if having to lease the elevator storage from Armour cut into Joe's profits, it was also cut Armour's storage space. Joe was still making a profit, but what he had hoped would be $4 million by now,  was instead just $330,000.
The catch was that Armour owned shipping lines, and he knew the fleet alone could hold 11 ½ million bushels, plus, controlling railroads, he knew the capacities of every freight car on his lines. And he knew that every ship and rail car sitting in Chicago filled with wheat already signed for as delivered,  was not available to move that grain to eastern or even European markets. Joe might now own 10 million bushels of wheat, but he could not sell it except at a loss, which grew greater every day.
Joe came to that realization as January of 1898 began. In one January week alone, Armour shipped 2.5 million bushels of wheat south. The Chicago Tribune waxed lyrical. "Does anybody realize what it means to move six or seven million bushels of wheat by boat and rail to Chicago?” They called it, “The most stupendous generalship in connection with the handling of a food product that the eyes of man have ever seen.” But Joe saw nothing poetic in this turn of events. The old Bull had called his bluff. So, Joe being Joe, he doubled down. He started buying spring wheat futures.
Of course this game of giants was not playing out in a vacuum. In the United States of 1897 the average income was just $450 a year, and the cost of food ate up almost 3/4th of that. The average working class family of five survived on $15.50 a week, while Armour's own workers were paid a paltry $9.50 a week  In May of 1897, when Joe started to “corner” wheat, a single loaf of bread in Boston cost 3 cents. A year later that had gone up to 4 cents, all while the United States was experiencing the most severe financial “Panic” and the highest unemployment until the Great Depression (see these columns for Coxey's Army). Prices of wheat in Chicago would not swing between highs and lows this much again until World War One.
But seeing Joe digging in on a losing position, P. D. Armour started buying spring wheat from the Pacific Northwest. In early February of 1898 he started shipping 2 million bushels of wheat by rail from Oregon to Chicago, to fill Joe Leiter's contracts. A hundred years later the Chicago Tribune would boldly point out, “ Armour didn't move 6 million (bushels). He moved 18 million.” Eager to cash in on this bonanza, farmers from Minnesota to Nebraska started planting wheat as soon as they could get into their fields. By April the price of May wheat futures had already passed $1.25 a bushel. On May 10th, 1898 it topped the old record of $1.85 a bushel.
And it was now that old man Leiter, Joe's father, returned from Europe. And although there is no proof it is assumed the two old financial warriors, Levi Leiter and Philip D. Armour had a talk. And quietly, the game came to an end. Armour took his foot off the Harvard boy's throat and Joe stopped buying wheat. By June of 1898, the price of a futures contract for wheat had collapsed back to 70 ½ cents a bushel, near where it had started the year before. The best that anybody can figure it, Joe's little $1 million adventure at taunting the Bull of the Wheat Pit would end up costing his father, after losses and law suits, almost $20 million (close to half a billion dollars in 2012)
How many childrens' empty stomachs this gamble produced is not known. The government would not concern itself with the humanitarian price of “free markets” for another two generations. And curiously, in the United States, the church, not Catholic, Protestant, Mormon, Jewish or Islam, has ever expended much of its moral force on the subject of the cost of capitalism. No one ever bothered to inquire how many families lost their farms when the wheat prices collapsed in an age before farm price supports.
Long after Armour and both the Leiters were dead, on February 7, 1914, a fire destroyed one of Armour’s Goose Island elevators, destroying almost 600,000 bushels of wheat, 310,000 bushels of oats, 95,000 bushels of corn and 5,000 bushels of rye. But not to worry, the company could afford insurance. The payout was $825,250.00 ($18 million today). In a capitalistic nation, if you can afford it, you never have to lose.
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Sunday, October 07, 2012

GEORGIA PEACHES Part Four

I know it is unfair to judge Patrick Henry by 21st century standards. He was an 18th century man. He was a slave owner, who measured his wealth in part by how many other human beings he owned. But the hypocrisy of speaking for freedom while holding part of humanity in bondage, was not completely lost on him or Jefferson or Washington. It might be helpful to remember that all of the founding fathers were only as brave and cowardly, wise and foolish, kind and cruel, selfish and giving as any person reading these words. And they were just as guilty as current politicians and modern “money managers” of humanity's greatest sin – a lack of humility.
Which brings me to the Virginia born, pugnacious and ambitious and very un-humble James Gunn. In 1777 this “arrogant (and) ambitious” 26 year old enlisted in the Continental cavalry under “Light Horse Harry” Lee. James rose to the rank of captain, and in 1780 he was dispatched to accompany General Gates, to recover the disaster when the British captured the port of Savannah, Georgia.. However Gates produced his own disaster at Camden. The fleet footed Gates was replaced by the very different General Nathaniel Greene. And Captain James Gunn provided General Greene with his first opportunity to restore discipline. The intimidating young Gunn had stolen a race horse from a South Carolina widow, and used it to cheat his fellow officers and locals in a “fixed” race. Reprimanded, James challenged his new commander to a dual. But Greene was protected by General Washington's orders that he not engage in duels. For once Gunn had to swallow the insult.
After the end of the land war at Yorktown, in late 1781, James Gunn decided to stay in Savannah. He passed the bar. He also renewed his demand that Nathaniel Greene give him satisfaction for the war-time insult. The matter was settled when the 43 year old Greene died of sunstroke, in 1785. The next spring James Gunn was called out by the militia to put down a slave “revolt”. In fact they had just run away. What the escaped slaves' plans actually were was unclear, but it was claimed there were 150 of them (unlikely), they were all men (unlikely) and they had been trained by the British (very unlikely). In any event, Gunn marched his little army ten miles northwest of Savannah, to Zubley's Ferry on the South Carolina border. He located the runaways and dispatched just 14 men to charge their encampment. The runaways fled into Bear Creek Swamp, where the brave Georgia militia butchered most of them. From that day forward, he was known derisively as “General Gunn”.
But the assault did not hurt his reputation in certain Savannah circles. And in 1787 James Gunn was appointed to the Constitutional Convention in Philadelphia. However he could not be bothered to show up. Still, in 1789 the 36 year old bully was selected as one of Georgia's new United States Senators. He showed up for that job, missing about 40% of his roll call votes. His only real Senate claim to real fame was when he blocked one of President Washington's appointments, because the naval officer, Benjamin Fishbourn, would not play ball with Senator Gunn and his friends. It was the first Presidential appointment blocked by a Senator. Gunn saw government service as just an extension of his personal business, and he saw world events, like the French Revolution, as a series of business opportunities.
When the mob stormed the Bastille in Paris in July of 1789, they set set off a seemingly endless series of wars, as the royal houses of Europe ineffectually sought to suppress the revolutionaries, and the revolutionaries tried to outdo each other in grotesque self destructive violence. This chaos inspired all the spare cash in Europe to start looking for deeper pockets to hide in. Senator Gunn figured American land speculation, like that old forgotten Yazoo swamp-land scheme, would look safe by comparison. The partners Gunn chose would prove no more trustworthy than the French mob, or worse, the European nobility.
Remember the Bank of North America, the financial institution which had saved the revolution? It was the invention of Robert Morris, the “Mozart of American finance”, a Philadelphia speculator and patriot. Since the revolution, Morris had founded several canal companies, a steam engine manufacturing company, built the first rolling iron mill in America, and was in negotiations to buy half of western New York state for $333, 333.33. (Morris knew as much about self promotion as Donald Trump.) Morris's long time business partner was the trusted Comptroller for the state of Pennsylvania, John Nicholson. He was responsible for collecting the state's taxes, and liquidating the estates of absentee loyalists. He quietly got rich doing that, and now owned iron and textile manufacturing firms, himself. He had shared many of these opportunities with Morris. And to connect these three wealthy men to their European investors, Gunn, Morris and Nicholson chose as their fourth partner young James Greenleaf, the U.S. Counsel to the Netherlands, who boasted he could snap his fingers and produce a million dollars of gold and silver from his dutch banker friends.
Gunn also decided he needed a couple of local Georgia front men. James Wilson had twice been elected to the Continental Congress from New York, and had been one of the original men nominated by President Washington to the Supreme Court. At the time it was such an easy gig, ( in its first decade the court heard only nine cases), that Wilson did double duty covering the Federal courts in Georgia, which officially made him a local boy. And as a “silent partner”Gunn enticed Nathaniel Pendleton to invest in his scheme. Pendleton had been Georgia's Attorney General in 1785-86. He was now the Federal Judge for the district of Georgia, and could be counted on to make legal judgments that favored his friends. That was, of course, a secret to those who appeared in his courtroom. So, with the investors in place, Gunn now needed to get his hands on the old Virginia Yazoo company.
Remember Patrick Henry's partner, David Ross? He had built his fortune by buying up abandoned properties from fleeing loyalists, including the Oxford Iron Works, which he now owned in full and had converted to a fully slave labor enterprise. By 1787, when the Yazoo swamp-land schemes had been in vogue, Ross was one of the wealthiest men in Virginia, but his fortune was built on a precarious foundation,  with each new venture financed by borrowing on the last. The cancellation by Georgia of the Virginia Yazoo Companies' s project had reduced the value of company shares to almost nothing. And that had started the dominoes of Ross' empire, to falling. Creditors were now nipping at his heels, and slave iron workers were no more productive than plantation slaves. In 1791, Ross was forced to sell most of his shares in the Virginia Company, first 5% to South Carolinian Wade Hampton, (who was now running the Carolina Yazoo company) and most the rest to the rapacious Senator from Georgia, James Gunn.
Now, as mentioned earlier, the American Government had been trying to take the Yazoo lands off Georgia's hands for a decade and more. But the Peach State's politicians had repeatedly refused every offer. They were convinced there was money in 'them-there' swamps – somehow. The problem was, if they were going to find a profit in the place, they were going to have to defend it first. In 1793 the arrogant red faced fire-plug, Governor George Mathews had been elected to his second non-consecutive term, partly on a platform of defending Georgia's western border against all challengers, be it from Federal government, the Spanish or the Indians. And by the border Mathews meant the Mississippi River. But Georgia did not have the money to build the line of forts Mathews wanted, and for some reason, he couldn't get the Federal government to loan him the cash.
Logically, Georgia had no choice but to resurrect the Yazoo land deal. At least, that was the logic of Senator Gunn, and Governor George Mathews. Suddenly everything was coming together rather nicely for the Yazoo swamp land deals.
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