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Tuesday, August 26, 2008

However, if Felony Convictions Are Going to Be the Topic of Discussion . . . . 

Mitt Romney, would-be second banana to presumptive GOP nominee John McCain, discussing the elderly former P.O.W.'s bewildering array of primary, secondary, tertiary, quaternary, quinary, senary, septenary, and octonary residences:
Speaking to reporters at a lunch sponsored by the Christian Science Monitor, Romney said that while McCain deserved his houses because of the "hard work" of himself and his family, "Barack Obama got a special deal from a convicted felon."

"I think it was a strange thing for Barack Obama to seize upon," Romney said. "If homes is going to be the topic of discussion that Barack Obama is going to end up on the short end of that one."

But Romney's attack stretches the truth. He was referring to Tony Rezko, a political fixer in Chicago and former Obama fund-raiser who was convicted by a federal jury earlier this year on corruption charges. It's true that Obama bought a piece of land from Rezko's wife to expand the yard of his $1.65 million Chicago home while Rezko was under federal investigation; Obama has since said the deal was a "bone-headed move," given the cloud that was already surrounding his former patron.

There is no evidence, however, that the Obamas got any "special deal" engineered by Rezko. Obama was able to buy the place thanks to two best-selling books and the six-figure salaries he and his wife were both earning.
Writing a best-seller can't be all that hard; in fact, we are at a loss to understand why more people don't do it more often. But what of the genuine "hard work" Mr. Romney mentions, by McCain "and his family"? McCain's own work consisted of dropkicking his first, poorer, crippled wife in favor of a good-looking beer heiress, which sounds on any number of counts like an easy call to us. The beer heiress's work consisted of being born into a rich family, which we are here to tell you can be quite trying, especially if there are hereditary obligations involved -- but we cannot in good conscience call it labor-intensive.

That leaves the beer heiress's father:
From Day 1, Hensley money has enabled McCain to be a full-time politician, free from financial concerns.

This story examines the roots of the Hensley fortune and John McCain's implacable bond to the liquor industry -- how it has enriched him personally and as a politician, and how those ties have dictated his actions on questions of public policy.

John McCain's political allegiances to liquor purveyors and his father-in-law's interests are subtle. That narrative is marked by a pattern of patronage.

The Hensley saga, meanwhile, swirls with bygone accounts of illicit booze, gambling, horse racing, deceit and crime. James Hensley embarked on his road to riches as a bootlegger . . . .

What is certain is that what occurred that December day was standard operating procedure for the Hensley brothers between April 1945 and January 1947. During this period, a 1948 federal criminal indictment charged, the Hensleys made approximately 1,284 false entries related to the sale of thousands of cases of liquor by their two companies -- United Sales Company in Phoenix and United Distributors in Tucson.

Ratliff's testimony eventually led to James and Eugene Hensley's conviction on federal conspiracy charges "with the intent and design to hide and conceal from the United States of America, the names and addresses of the person or persons to whom the said distilled spirits were sent, and the prices obtained from the sale thereof."

A federal jury in U.S. District Court of Arizona in March 1948 convicted James Hensley on seven counts of filing false liquor records in addition to the conspiracy charge. Eugene was convicted on 23 counts of filing false statements and the conspiracy count. Eugene was sentenced to one year in prison, and James to six months. Neither brother testified during the trial, relying instead on their lawyers, who included Louis B. Whitney, a prominent attorney who served as mayor of Phoenix from 1923 through 1925.

After a two-week stint in the Maricopa County jail, the men were released on bond on May 17, 1948, pending an appeal to the U.S. 9th Circuit. The appeals court affirmed the conviction on February 8, 1949.

Two weeks later, a judge sentenced Eugene to one year in a federal prison camp near Tucson, but suspended James' sentence, placing him on probation instead. Both men were fined $2,000. United Sales and United Distributors were also convicted and fined $2,000.

The criminal convictions had little immediate impact on the brothers' fortunes . . . .

Although Hensley wealth has helped propel McCain's political career, the senator will never get his hands directly on the Hensley fortune because of an antenuptial agreement he signed before his 1980 marriage.

A centerpiece in McCain's remarkable and sudden rise to national prominence is his promise of campaign-finance reform.

Yet McCain has relied heavily on the financial contributions from big corporate donors -- with the liquor and beer industry near the top of the list. McCain won -- one could say bought -- his first election to the House of Representatives in 1982 with lavish sums of Hensley beer money.
Far be it from us to suggest that felons are not hard workers. After his initial conviction, Mr. Hensley continued to show great entrepreneurial zeal:
[O]ld newspaper clips . . . showed Jim Hensley had been an underling to well-known power broker Kemper Marley Sr., a rich rancher and wholesale liquor baron with suspected links to the 1976 car-bomb murder of Arizona Republic reporter Don Bolles . . . .

In 1953, Jim Hensley was again charged with falsifying records at Marley's liquor firms.
The companies were defended by William Rehnquist, who would go on to become chief justice of the Supreme Court. Hensley was found not guilty.
The Hensley Bros. subsequently invested some of their profits in the Ruidoso Downs racetrack. Yet, in a hearing before the New Mexico Racing Commission, they mysteriously omitted to mention a third, silent partner, bookmaker Clarence Baldwin:
At a May 1953 commission hearing in Albuquerque records show the Hensley brothers readily told of their connections with the Arizona wholesale liquor business and Marley in the 1930s and 1940s and the federal convictions in 1948 for making false entires on government records regarding ???? liquor sales.

However, the Henleys denied at the same hearing that Baldwin their old croney in Phoenix, had any stock interest in Ruidoso Downs.

But two years later, at another hearing records reflect Baldwin did have stock interest in the track.
We do hope that Mr. Romney secures his party's vice-presidential nomination, because we are always eager to learn more about the value of hard, extralegal work, and the difficulty of inheriting its fruits.

(Thanks to our eminent colleagues Josh Marshall and Jon Schwarz for the links.)

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