Previously: That’s a really good question (July 3, 2012)

“…you can only put thirty thousand dollars per year as a regular person into these accounts. How could he possibly have grown that account to one hundred and one million dollars?…”

Jennifer Granholm on Current TV:

http://current.com/bc/1719777665001?linkBaseURL=http%3A%2F%2Fcurrent.com%2Fshows%2Fthe-war-room%2Fvideos%2Fcall-for-transparency-romneys-astronomical-101-million-ira

Jennifer Granholm: Governor Romney’s IRA, his Individual Retirement Account, is reportedly worth as much as one hundred and one million dollars. This is just his retirement account. But you can only put thirty thousand dollars per year as a regular person into these accounts. How could he possibly have grown that account to one hundred and one million dollars?

Edward Kleinbard: Uh, uh, you know, again, this, this is a great mystery and, um, there are, uh, two possibilities. One is that from a little acorn a mighty oak grew very, very quickly, uh, extraordinarily so. Uh, but at [crosstalk] thirty thousand dollars a year for fifteen years.

Jennifer Granholm: How can that be? Wait, wait, wait, wait, don’t move away from that. How could this, what little acorn would have grown to a hundred and one million? And I want to get some of that acorn.

Edward Kleinbard: Exactly so. Me, too. Uh, you would have to have had, um, if you actually put thirty thousand dollars of cash, uh, away in a 401K plan for fifteen years, which was his tenure at Bain. You know, that by itself is four hundred and fifty thousand dollars. So you can imagine you need, you need a, uh, a return of like thirty percent a year to, to reach a hundred million dollars.      

Jennifer Granholm: Which is ridiculous.

Edward Kleinbard: Exactly. So, the other possibility, uh, and the one that I find quite troubling, and again, disclosure would clarify all of this, complete disclosure would clarify it, uh, is that, uh, he didn’t just put thirty thousand dollars of cash in the fund which then went out and invested in, you know, S and P five hundred public stocks. The money went to buy, uh, interests in Bain funds that he himself controlled and he sold them at prices that he set. And the question is, did he set those prices at an honest fair market value [crosstalk], or did he lowball the prices?

Jennifer Granholm: Okay, wait, now, I just want to be clear about this. So, what you’re saying is that somebody can, um, put something into their IRA where they set the value of it and if it comes in under that thirty thousand, is that what it is, if it comes in under that cap that it’s okay, or is it a special deal [crosstalk] with private equity?

Edward Kleinbard: No. No, it, it’s, uh, it’s not okay. Uh, the price at which you sell into your 401K or IRA plan has to be the market price for what you’re selling. And so, if in fact you systematically are selling, um, uh, speculative, uh, uh, positions in private equity firms, uh, private equity funds, investments that you’ve made, uh, and you’re systematically doing that for nominal prices, that’s in fact a very serious issue.

Jennifer Granholm: So.              

Edward Kleinbard: Because, he would not have offered me the opportunity to buy those same interests at the, at nominal prices. And so, that’s the question. [crosstalk] That’s the issue.

Jennifer Granholm: So, in other words, if I’m, I just want to read into it, ’cause I just want to say it as it is. So, he would have put into his IRA something that he put a value on which had the potential to grow enormously, so he maybe would have, again, this is all speculation on our part, he maybe would have undervalued it as it went in to the IRA, grew enormously, he wouldn’t have had to pay taxes on that because it is exempt from tax ’cause it’s an IRA. So that’s how possibly it could grow to some astronomical amount like a hundred and five million?                          

Edward Kleinbard: Right, because, if it, imagine, just as by way of an example, imagine that you, you valued, um, uh, positions that you sold to your IRA at ten cents on the dollar, ten percent of what they’re really worth. Well that means that you can put three hundred thousand dollars into your IRA, not thirty thousand dollars. Now, what’s very frustrating to me about all this, uh, you know, is that, uh, we, we can only, uh, talk in abstractions and generalities because, again, of the lack of disclosure. These are issues that, that, that would be clarified presumably to the governor’s, uh, benefit if he were to be [crosstalk], if were to be more candid with the American people.                

Jennifer Granholm: If he were to be open, open.

Edward Kleinbard: Exactly.

Jennifer Granholm: All right.

It’s the one percent’s world, the rest of us only get to subsist in it.

Given his position as the ranking minority member of the Senate Intelligence Committee, it was probably too much to expect that Kit Bond would refrain from joining the chorus of what David Brooks, in an unexpectedly excellent column, called the “rabid denunciation and cynicism”  that has characterized the right’s response to the Christmas bomber incident. On the topic of the bomber, Omar Abulmutallab, Bond holds, along with the rest of his party, that treating terrorist crimes in the criminal justice system is to privilege terrorists in some inappropriate way:

This is not a case for a series of criminal trials, … .  We should have held him as an enemy combatant and tried him in a military commission.

Earlier, on the issue of the Gitmo detainees, he had this to say:

The Obama Justice Department has prioritized political correctness over protecting the citizens of this country.

Apart from seizing an opportunity to ring the proverbial Pavlovian bell with phrases like “political correctness” applied to Obama and terrorism, one wonders why would-be tough guy politicians like Bond fail to remember the equal determination of one of their close allies, Margaret Thatcher, to deny IRA men “special status”.  This status would have accorded IRA members a prisoner of war status not too dissimilar to that accorded to those held in the military system of detention and justice that Bond and his pals prefer.

In 1981 Thatcher permitted ten young hunger strikers to starve to death, one after another, in a protest against the loss of political status for those convicted of terrorism-related offenses. As Padraig O’Malley notes in his book about those events, Biting at the Grave (p. 19):

Having what amounted to de facto prisoner of war status was of immense propaganda value to the IRA. It allowed the movement to describe the conflict in Northern Ireland on its own terms  …  and to claim that the British government accepted the IRA’s legitimacy and hence the legitimacy of its cause.

So do Bond et al. really want to legitimate Al-Qaeda by according their members military status? Do they really want to keep on handing Al-Qaeda these great propaganda tools for recruiting purposes? For that matter, if they don’t want to glamorize the terrorists’ cause, maybe they ought to shut up about the “war on terror.” Didn’t they learn anything from their onetime good friend, Dame Margaret?

Of course, in pointing out this disjunction, I do not mean to overlook the obvious – which is that what Bond and his pals really mean to say is that it is hard to torture folks when the process is open to scrutiny. And of course, no matter what status prisoners enjoyed in Northern Ireland, Dame Margaret had the Special Powers Act which gave her almost unlimited power to do whatever she wanted. Thank God we still have a few rights left. Maybe.

ADDENDUM:  Via TPM, Bond amplifies his position today:

We have learned the hard way that trying terrorists in federal court comes at a high price, from losing out on potentially life-saving intelligence to compromising our sources and methods. We must treat these terrorists as what they are–not common criminals, but enemy combatants in a war.

In December 2001, the Shoe Bomber, Richard Reid, was immediately charged in federal court, rather than being designated as an enemy combatant and questioned about his terrorist ties,” says Bond. “Fortunately, the Bush Administration did not repeat this mistake with Jose Padilla who was named an enemy combatant, which allowed him to be interrogated, before eventually facing criminal charges.”

He continues: “Yet today with the experience of eight years in this war behind us, we have regressed, treating the Christmas Day bomber and the Somali pirate as common criminals, rather than seizing the opportunity to obtain timely intelligence from these terrorists. This is a grave error that could have dangerous consequences for our nation.

AS TPM notes:

It’s worth noting that President Bush had military tribunals as an option by November 2001 when he signed an order establishing rules for tribunals. That was a month before Reid’s attempted attack on American Airlines Flight 63.

…..

A search on Nexis found no evidence of controversy over Bush decision to try Reid in federal court, and no criticism from Bond on the handling of the case.

The Politico article on Bond’s comments (2nd link above) reported that that the administration already has a deal underway to get information from Abulmutallab, but that Bond, seemingly with no real information to back up his prescience, declared that that it “would take too long.”  He either has second sight or, like a dog with a bone, he just can’t stop demagoguing the issue.