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Elizabeth Warren Skipped 2016 Run, But Has Stayed In Picture

By Joshua Green, Bloomberg News (TNS)

WASHINGTON — Early last year, the frenzy to enlist Elizabeth Warren in the 2016 presidential race grew so intense that a Ready for Warren group emerged to lead a draft effort. Reporters parsed the Democratic Massachusetts senator’s every utterance for clues to her plans. In the end, Warren opted to pass. But so far, she hasn’t chosen to throw her support behind any of the other candidates.

With President Barack Obama unlikely to weigh in, Warren is the most important Democratic elected official who has yet to endorse. Her iconic status among the party’s liberal grass roots, and the national fundraising base she commands, would deliver a substantial boost to Hillary Clinton, Bernie Sanders, or Martin O’Malley.

Sanders would appear to be the most ideologically compatible choice for Warren, because his populist, anti-Wall Street rhetoric mirrors her own. And indeed, many of her supporters, including the founders of her draft movement, have embraced him. But Warren has been noticeably reluctant to lend her name to Sanders’s presidential campaign, because, her advisers say, she’s determined that Democrats should hold on to the White House after Obama leaves office and is not convinced Sanders could win. “Her prime directive is not to damage the party’s chances in November,” says a close Warren associate, who has discussed the matter with her.

Yet, while she signed a 2013 letter urging Clinton to run, Warren is the only female Democratic senator who hasn’t backed the former secretary of state. She was also the lone senatorial no-show at the Clinton campaign’s Nov. 30 Women for Hillary rally near the Capitol. “Maybe she has a cold,” Maryland Sen. Barbara Mikulski deadpanned at the time. Representatives for Warren, Clinton, and Sanders declined to comment.

Warren isn’t being entirely silent. She periodically emerges to praise the major candidates for espousing policies she favors. In December, the Clinton campaign was elated when Warren took to Facebook to praise the candidate’s call to block riders in the year-end budget bill that would have weakened financial regulations.

“Secretary Clinton is right to fight back against Republicans trying to sneak Wall Street giveaways into the must-pass government funding bill,” Warren wrote. “Whether it’s attacking the (Consumer Financial Protection Bureau), undermining new rules to rein in unscrupulous retirement advisers, or rolling back any part of the hard-fought progress we’ve made on financial reform, she and I agree: ‘President Obama and congressional Democrats should do everything they can to stop these efforts.’”

Sanders has garnered similar approbation. On Jan. 6, Warren unleashed a tweet storm in support of his speech on Wall Street reform: “I’m glad @BernieSanders is out there fighting to hold big banks accountable, make our economy safer, & stop the GOP from rigging the system.”

Warren’s allies argue that she’s been able to shape the primary race by creating a “system of incentives” that has influenced candidate behavior. “There was almost no oxygen in the room for big, structural Wall Street reform after Dodd-Frank until Warren came on the scene,” says Adam Green, co-founder of the Progressive Change Campaign Committee, a liberal group. “The fact that all three Democratic presidential candidates are competing with each other to have the boldest plan for Wall Street reform and accountability — including explicitly calling for jailing Wall Street bankers who broke the law — is testament to Warren’s looming presence and influence in the Democratic primary.”

Warren has extracted some significant policy commitments that will be difficult for a future Democratic president to break. In August, Vice President Joe Biden met privately with Warren while considering a presidential run. A week later, Clinton endorsed a bill that Warren has championed restricting “golden parachute” pay packages for Wall Street bankers who take jobs with the federal government — a development many liberals took as a sign that Clinton feared losing Warren’s support to Biden.

Given the almost Trump-like media fixation with Warren as recently as a year ago, it’s remarkable that she’s disappeared from the presidential race to the degree that she has. While it’s possible that she will be able to maintain her low profile until a nominee emerges, it’s also easy to envision a scenario in which she is thrust right back into the race: Both Clinton and Sanders backers agree that if Sanders were to prevail in Iowa and New Hampshire, Warren would come under intense pressure from both candidates to deliver an endorsement.

©2016 Bloomberg News. Distributed by Tribune Content Agency, LLC.

Photo: AFGE via Flickr


The Billionaire Whose Clinton Foundation Ties Could Be Trouble For Hillary Clinton

By Joshua Green, Bloomberg News (TNS)

Like countless people before him, Frank Giustra’s first meeting with Bill Clinton was a life-altering event indelibly etched in his memory. “We hit it off right away,” Giustra recalls. “We hit it off for a whole number of reasons. We had a very similar upbringing. We had similar interests in books. Pretty soon, we were having a great conversation. I think he liked me.”

Giustra was experiencing the famous Clinton connection, the tractor beam of personal magnetism that Clinton has deployed to pull people into his orbit since his earliest days in Arkansas.

Back then, they were people like Mack McLarty, the well-to-do kindergarten classmate who became Clinton’s first White House chief of staff, and Jim McDougal, the local banker and real estate investor who was the Clintons’ partner in the Whitewater land deal and eventually wound up in jail.

In Arkansas the stakes were comparatively small. Clinton had little money, and his admirers didn’t have a whole lot more. Today, in his post- presidency, Clinton has built up a multibillion-dollar family foundation with a global reach. He may soon be back in the White House. The people he solicits are the sort who gravitate to Davos, not Little Rock _ people like Frank Giustra.

Giustra is a billionaire mining magnate from Vancouver, Canada, who met Clinton in 2005 aboard his private jet, which he had lent the former president for a trip to South America. (Clinton really must like Giustra — or his jet — an awful lot, because he borrowed it 25 more times, according to The Washington Post.)

Somewhere in the air between Little Rock and Bogota, Giustra realized, as so many had before him, life would be more glamorous, important, and fun with more Bill Clinton in it: “I said to him, ‘Hey, tell me more about what the Clinton Foundation does.’ ”

Before long, Giustra had pledged $100 million, established a Canadian arm (the Clinton Giustra Enterprise Partnership), and joined the Clinton Foundation’s board. By his own telling, his life has been utterly transformed. “I’d been doing charitable work my whole adult life but on a very small scale,” he says. “Then I met Bill Clinton. Just hanging out with him and seeing how he had dedicated his life to this — I know this sounds cheesy, but it’s true — he inspired me.”

Giustra now sees himself as Canada’s answer to Andrew Carnegie and intends, as Carnegie did, to give away his fortune apart from what he requires to live on. The vehicle for his giving shouldn’t come as a surprise. “In the philanthropic sense,” he says, “all my chips are on Bill Clinton.”

Although few people outside the mining industry had heard of Giustra until recently, he’s emblematic of the class of plutocrats with whom Clinton has surrounded himself since leaving office. He also represents a new kind of political problem sure to dog Hillary Clinton’s presidential bid. As the author Peter Schweizer documents in his book Clinton Cash: The Untold Story of How and Why Foreign Governments and Businesses Helped Make Bill and Hillary Rich, Giustra’s globe-trotting adventures with Bill Clinton have coincided with lucrative business deals.

In Colombia, where his investments include oil, timber and coal mines, Giustra dined one evening in 2010 with Bill and Hillary Clinton, who both met with Colombia’s president the next day. Soon after, one company in which Giustra holds a stake “acquired the right to cut timber in a biologically diverse forest on the pristine Colombian shoreline,” Schweizer writes, and another was granted valuable oil drilling rights.

A similar situation had unfolded in Kazakhstan in 2005. Giustra and Clinton jetted in to dine with the country’s authoritarian president, Nursultan Nazarbayev. Days later, Giustra’s mining company signed an agreement giving it stakes in three state-run uranium mines in addition to those it controlled in the U.S. After a $3.5 billion merger, the company was eventually acquired by the Russian atomic energy agency, Rosatom. Because uranium is a strategic asset, the sale required (and received) approval from multiple U.S. agencies, including the State Department, then run by Hillary Clinton.

Giustra insists these deals were on the up-and-up and Bill Clinton played no role. “He’s shown up in two places where I’ve done business,” he says, “but I’ve traveled to countless countries around the world with him and put money into (charitable) programs in places I have zero business interests in.”

While Giustra hasn’t done charity work in Kazakhstan, he says a deal of that scale is hashed out over many months and didn’t require Nazarbayev’s permission. He adds that he sold his stake in the uranium mining company two years before Hillary Clinton became secretary of state, and he agreed to share documents with Bloomberg Businessweek that would prove this, although a week later he hadn’t produced them.
Previous Friends of Bill have sometimes fallen out of favor when deemed a liability. Ron Burkle, the billionaire supermarket magnate, is the most famous example. Before Giustra, Burkle was the one flying Clinton around in a private jet and enjoying his attention and companionship. That relationship began to sour in 2007 with Hillary’s bid for the White House. According to press reports, Burkle’s business ties to foreign governments were part of the reason for the split.
Giustra professes to have no concern that politics might prompt Clinton to jilt him, too. “I don’t think it’s going to happen,” he says, “but if for whatever reason Clinton walked away from this, I would just change the name of the damn thing, and I would carry on. I’m dead serious.”

Tuesday, the Clinton campaign rolled out a website, the Briefing, to attack Schweizer and rebut the book’s insinuations of corruption. But the damage Hillary Clinton has sustained is largely self-inflicted. Although the Clinton Foundation signed an agreement with the White House to disclose its donors as a condition of her becoming secretary of state, it hasn’t fulfilled the pledge. A New York Times investigation of Giustra’s uranium mining deal turned up donors whom the Clinton Foundation failed to disclose. Bloomberg found an additional 1,100 undisclosed foreign donors. The Boston Globe turned up even more.

This may help explain why a majority of independents in a New York Times/CBS News poll Tuesday said that although Hillary Clinton is a “strong leader” who “shares their values,” she is “not honest and trustworthy.”

Improving her image will be a challenge in light of the scrutiny yet to come. The Clinton Foundation has announced it will continue accepting money from select foreign governments and won’t disclose the identities of all its foreign donors. Bill Clinton told NBC News he would keep giving paid speeches because “I gotta pay the bills.”

Voters will have to take it on faith that these arrangements are as innocent as the participants claim. Giustra, for one, sounds doubtful they will. “If I didn’t know me, and I wasn’t there,” he says, “I would think, Oh my God, there is some connection between all the good stuff that’s happening with Giustra and his donations to the Clinton trips.”

If Hillary Clinton is going to make it to the White House, she’ll need to convince the country otherwise.

(c)2015 Bloomberg News, Distributed by Tribune Content Agency, LLC.

Former U.S. Secretary of State Hillary Clinton addresses the press after attending the annual Women’s Empowerment Principles event at UN headquarters in New York on Tuesday, March 10, 2015. The potential 2016 U.S. presidential contender defended her use of a personal email account for official communications, saying it was “for convenience.” (Niu Xiaolei/Xinhua/Sipa USA/TNS)

The Return Of The Death Of Obamacare

By Joshua Green, Bloomberg News (TNS)

WASHINGTON — The possibility that the U.S. Supreme Court will soon eliminate federal subsidies for people buying health insurance through the Affordable Care Act is the biggest story in politics and economics that no one wants to talk about. But the stakes in King v. Burwell, which the court will hear on March 4, could scarcely be higher: If the plaintiffs prevail, millions of people in 34 states who bought insurance on federal exchanges would suddenly lose the subsidies that make it affordable. Consequently, most would lose their coverage. A Rand study pegged the number at 9.6 million people, with premiums soaring 47 percent for those still able to afford them. “Everyone agrees this would be a cataclysmic hit to the insurance market,” Michael Kolber, a health-care attorney at Manatt, Phelps & Phillips, said at a Feb. 13 Bloomberg Intelligence panel on King v. Burwell.

The immediate effect of a ruling against the ACA would be to hurl the political system, and no small part of the economy, into chaos. Yet there’s little sign that Washington is preparing for that scenario. Democrats won’t talk about what they would do because they don’t want the court to believe they could contain the fallout. Republicans don’t want to talk because they’re loath to admit that, even after voting 67 times to repeal or defund the ACA, they have no plan to help the millions who would be affected. (But they’d sure love the court to kill the law anyway.) Hospitals and insurers understand that bewailing their financial plight might not help their cause. Instead, they’ve channeled their warnings into amicus briefs.

A notable exception to this monkish silence is Stuart Butler of the Brookings Institution in Washington. Butler, 67, is the Zelig of modern health care reform, present at every critical stage. In 1993, as a scholar at the conservative Heritage Foundation, he designed a health care plan around an individual mandate that became the main alternative to the Clinton administration’s plan. A decade later, when he soured on the mandate, many conservatives followed suit. President Barack Obama’s decision to make the mandate a pillar of the ACA ignited broad conservative antipathy to the idea, which left Butler, its progenitor, awkwardly situated when Heritage became the locus of opposition. His decision last July to leave Heritage after 35 years and move to Brookings is a gauge of how far Republican health care policy has moved to the right since the Clinton era.

Practically alone among Republicans, Butler is sounding an alarm about what a decision in favor of the King plaintiffs would carry with it. While Democrats would be dismayed if the court guts Obama’s signature initiative, Butler’s worry is grounded in an understanding that voters with skyrocketing premiums may not blame Obama, as Republicans assume. They’ll expect the party hell-bent on destroying the law to have a solution — and react badly if none is forthcoming. Because 16 states operate their own exchanges and therefore won’t be affected by the court’s ruling, Butler believes the ACA will stagger on and eventually recover, since voters won’t abide a system wherein some states have affordable, federally subsidized health care coverage and others do not. Absent an alternative, he says, the ACA will rise again like a horror-movie killer. “People who believe the ACA instantly goes away are deluding themselves,” he says. “By not doing anything to develop a Republican vision of how to move forward, they could end up with the very nightmare they’re trying to avoid.”

On the political front, lawmakers would have to decide what to do about the people in 34 states who would lose their subsidies. In theory, Congress could tweak the law to restore them. But Republicans have no interest in this, nor have they shown any sign of being able to agree on any other fix, much less one that Obama would support. That would throw responsibility to the states, which would each have to try and devise their own solution. Some would probably manage; others, especially those with Republican governors or legislatures implacably opposed to the ACA, almost certainly would not.

The result would not just leave millions uncovered but also risk destroying the individual health care markets in states that don’t act. According to a brief filed by a consortium of hospital trade groups, “A market without subsidies will trigger a premium ‘death spiral’ in those states: With subsidies gone and premiums pushed higher, younger and healthier patients will likely drop coverage. Those that remain, paying the higher rates, are likely to be sicker and use more health-care resources. That, in turn, will push rates for everyone in those states even higher, which will cause more to drop coverage, and so on.”

On the business front, the effects would be no less significant. “If the U.S. health care system were its own economy,” says Butler, “it would be the sixth-largest in the world — larger than Britain’s.” Entire segments of the health system redesigned their business models to take advantage of the ACA’s incentives. Hospitals, for instance, were given a trade- off: They stopped receiving government payments to offset the cost of treating the uninsured, cuts that amount to $269 billion over a decade. In return, they were promised millions of new patients insured through federal subsidies. “All the major hospital systems and big insurers like Kaiser and Geisinger spent a ton of money adapting to the ACA,” says Butler. If subsidies vanish, “suddenly the market is misaligned. If you’ve hired all these new doctors and health care workers to cover all these new people walking in the door, and they don’t come, what do you do? You lay them off.”

This is no mere hypothetical. In 2012, after the ACA had ended hospital reimbursement payments, the Supreme Court ruled that state Medicaid expansion was optional, rather than mandatory, as the law had decreed. Hospitals in the states that chose not to expand Medicaid lost one source of income without gaining a new one to offset it (Medicaid patients). At least 43 hospitals have closed as a result, with the pace picking up each year, according to an investigation by USA Today.

The ACA also opened up a flood of investments in digital health ventures. A recent study by StartUp Health, a New York incubator, found that $14.5 billion has been invested since the law was signed, including $6.5 billion last year. “If Congress is unwilling to take action, it would clearly make it less attractive to invest in things related to the coverage expansion,” says Bob Kocher, a partner specializing in health care IT at the venture capital company Venrock. “It slows the rate of change in the health care ecosystem in a way that’s bad for everybody and hurts companies going after these new patients, who are going to suffer.”

If the court strikes down federal subsidies, Butler hopes Congress will use the resulting pressure from voters and health care companies to implement a more conservative vision of health care reform — changing the tax treatment for employer- sponsored health plans and allowing states much greater flexibility to spend Medicaid money and design their own systems (abolishing the individual mandate if they wish).

But Butler’s plan would require a Republican contingent willing to go along — and so far none has materialized. “When Clinton came in, there was clear momentum toward a sweeping reform of the health system,” he says. “There was a big debate on the right about whether to try and match it, but with a different structure, or just to attack.” Butler sided with those who wanted to fix the problem. That’s much harder now. “Today, I think we’re in the exact same situation,” he says. “Only this time there isn’t a core group of people who have coalesced around a basic alternative.”

It’s possible such a group will emerge as the court prepares to issue a decision, probably in late June. The party’s presidential aspirants may also take an interest in Butler’s alternative, given the failure of efforts to repeal the law. “You can bang your head against the wall all you like,” says Butler. “If it doesn’t fall down, then maybe you should go around it or figure out some other way to move forward.” So far, though, no one has called. But if the court sides with the King plaintiffs and the blowback is as intense as some people expect — well, maybe then Butler’s phone will start ringing.

Photo: SEIU International via Flickr