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Wednesday, July 07, 2004

Why It Pays to Own the Cops and the Courts 

Wrongdoing? What if there was? Wanna make something of it? From the NY Times:
An internal investigation by the Department of Health and Human Services confirms that the top Medicare official threatened to fire the program's chief actuary if he told Congress that drug benefits would probably cost much more than the White House acknowledged.

A report on the investigation, issued Tuesday, says the administrator of Medicare, Thomas A. Scully, issued the threat to Richard S. Foster while lawmakers were considering huge changes in the program last year. As a result, Mr. Foster's cost estimate did not become known until after the legislation was enacted.

But neither the threat nor the withholding of information violated any criminal law, the report said. It accepted the Justice Department's view that Mr. Scully had "the final authority to determine the flow of information to Congress." Moreover, it said, the actuary "had no authority to disclose information independently to Congress" . . . .

Ms. Corrigan discovered "no criminal violations,'' though she sent her findings to the General Accounting Office, a Congressional investigative arm, to determine if Medicare officials had violated an appropriations law that protects the right of federal employees to communicate with Congress. In May, the Congressional Research Service said Mr. Scully's order to Mr. Foster apparently violated that law, which has been on the books in various forms since 1912.

William A. Pierce, a spokesman for the department, said Tuesday that the threat was not illegal because the actuary was supposed to report to the head of the Medicare program, who, Mr. Pierce said, had a right to dismiss him in case of insubordination. "No laws were broken,'' Mr. Pierce said.

But Representative Pete Stark of California, the senior Democrat on the House Ways and Means Subcommittee on Health, said, "It sounds as though the Bush administration examined itself and found it did nothing wrong.''
And, from Reuters:
Telephone transcripts that show Enron Corp. traders gloating about stealing money from "Grandma Millie" during California's energy crisis might not offer new evidence of illegal behavior, the head of the Federal Energy Regulatory Commission said on Wednesday.

Evidence contained in audio tapes in which Enron traders discuss ways to gouge California customers during the state's 2000-01 crisis have renewed the call for refunds at the FERC.

But FERC Chairman Pat Wood questioned whether the tapes present actionable new evidence.

"Goading over something happening is not the same as pulling a trigger," Wood told reporters after a monthly FERC meeting. "It's odious and probably very offensive, but is it something that we remedy here under the Federal Power Act? I guess that's the question."

Democratic Sen. Dianne Feinstein and other lawmakers have asked FERC to revoke the bankrupt power trader's authority to sell electricity back to Jan. 1, 2000.

Feinstein says that would allow the agency to order $1.8 billion in refunds from Enron, far more than the $32.5 million a FERC judge has recommended.

The agency has no power to order retroactive refunds, Wood said. "The law requires a prospective remedy," he said . . . .

The agency process could be California's best hope of winning additional refunds. A U.S. federal appeals court in San Francisco this week dismissed over a dozen lawsuits that the state filed against energy suppliers and said FERC has primary jurisdiction over refund claims.

California Attorney General Bill Lockyer said he might appeal the decision to the U.S. Supreme Court.
(Links courtesy of K.Z., the hardest-workin' patriot in Zembla.)

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