John Edwards 2008: What’s not to like

WASHINGTON — There’s losing. There’s losing honorably. And then there’s John Edwards.

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Then there is John Edwards. He’s not going to be president either. He stays in the race because, with the Democrats’ proportional representation system, Barack Obama and Hillary Clinton might end up in a very close delegate race — perhaps allowing an also-ran with, say, 10 percent of the delegates to act as kingmaker at the convention.

It’s a prize of sorts, it might even be tradeable for a Cabinet position. But at considerable cost. His campaign has been a spectacle.

Edwards has made much of his renunciation of his Iraq War vote. But he has not stopped there. His entire campaign has been an orgy of regret and renunciation.

– As senator, he voted in 2001 for a bankruptcy bill that he now denounces.

– As senator, he voted for storing nuclear waste in Nevada’s Yucca Mountain. Twice. He is now fiercely opposed.

– As senator, he voted for the Bush-Kennedy No Child Left Behind education reform. He now campaigns against it, promising to have it “radically overhauled.”

– As senator, he voted for the Patriot Act, calling it “a good bill … and I am pleased to support it.” He now attacks it.

– As senator, he voted to give China normalized trade relations. Need I say? He now campaigns against liberalized trade with China as a sellout of the middle class to the great multinational agents of greed, etc.

Breathtaking. People can change their minds about something. But everything? The man served one term in the Senate. He left not a single substantial piece of legislation to his name, only an astonishing string of votes on trade, education, civil liberties, energy, bankruptcy and, of course, war that now he not only renounces but inveighs against.

Today he plays the avenging angel, engaged in an “epic struggle” against the great economic malefactors that “have literally,” he assures us, “taken over the government.” He is angry, embodying the familiar zeal of the convert, ready to immolate anyone who benightedly holds to any revelation other than the zealot’s very latest.

Nothing new about a convert. Nothing new about a zealous convert. What is different about Edwards is his endlessly repeated claim that the raging populist of today is what he has always been. That this has been the “cause of my life,” the very core of his being, ingrained in him on his father’s knee or at the mill or wherever, depending on the anecdote he’s telling. You must understand: This is not politics for him. “This fight is deeply personal to me. I’ve been engaged in it my whole life.”

Except for his years as senator, the only public office he’s ever held. The audacity of the all-my-life trope is staggering. By his own endlessly self-confessed record, his current pose is a coat of paint newly acquired. His claim that it is an expression of his inner soul is a farce.

A cynical farce that is particularly galling to left-liberals of real authenticity. “The one (presidential candidate) that is the most problematic is Edwards,” Sen. Russ Feingold told The Post-Crescent in Appleton, Wis., “who voted for the Patriot Act, campaigns against it. Voted for No Child Left Behind, campaigns against it. Voted for the China trade deal, campaigns against it. Voted for the Iraq War. … He uses my voting record exactly as his platform, even though he had the opposite voting record.”

It profits a man nothing to sell his soul for the whole world. But for 4 percent of the Nevada caucuses?

Washington Post 1/25/08

Clinton’s campaign responded by targeting Edwards’ previous consulting work for a hedge fund that owned a sub-prime lender.

“If John Edwards really cared about working people, he wouldn’t have taken a $500,000 salary from a hedge fund that is foreclosing on working people around the country,” said Clinton campaign spokeswoman Hilarie Grey. “Sen. Edwards should spend his time talking about how he’s going to help those people instead of launching ridiculous attacks against Sen. Clinton.”

Edwards worked part-time for Fortress Investment Group, getting paid $479,512. The former North Carolina senator redirected roughly $16 million invested in the fund after learning that two sub-prime mortgage companies it owned had sued to foreclose on 34 New Orleans homeowners. Edwards also used his own money to start a fund to help those homeowners.

He has said he won’t create a similar fund for homeowners elsewhere who were sued by the lenders.

Las Vegas Sun 11/16/07
http://www.lasvegassun.com/sunbin/stories/nevada/2007/nov/16/111610804.html

Yet at the same time, Edwards was also working for an industry that symbolized the overprivileged: a hedge fund, a partnership that specializes in high-return investments for the richest and most exclusive of clients. The firm, Fortress Investment Group LLC, hired Edwards in October 2005, several months after the poverty center opened, to help develop investment opportunities worldwide and offer strategic advice on global economic issues, according to a statement issued by Fortress in October 2005.

Edwards said in an interview that as he explored career options he talked with numerous firms, including Goldman Sachs, and decided to work as a part-time consultant to learn more about capital markets and to make money. Fortress did not return repeated calls for comment.

Edwards also said his role at Fortress was as an adviser, not a decision-maker.

“It was just being a consultant on the phone,” he said. “They would call and ask what I saw happening in Washington, sort of macro view of what was happening in Washington with the economy. What I saw happening in the world. Those were the kinds of things we talked about.”

He earned nearly $480,000 as a consultant in 2006, and stopped his work there by the end of that year; he still has about $16 million of his reported net worth of $30 million invested in Fortress funds. Employees at the hedge fund have given more than $150,000 in campaign contributions to Edwards, making the partnership one of his largest sources of funds.

After he joined the presidential race, Edwards’s involvement with Fortress became a political liability. Fortress had invested a portion of its assets in subprime mortgage lenders who recently began foreclosing on homeowners around the country, including some Hurricane Katrina victims, the poor people Edwards’s poverty center was set up to help.
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When the Fortress investments were revealed in the Wall Street Journal in August, Edwards responded by divesting his Fortress portfolio of funds tied to subprime mortgages. He also helped the Association of Community Organizations for Reform Now, or ACORN, a nonprofit organization helping low- and moderate-income families, launch a Louisiana Home Rescue Fund. He provided much of the $100,000 in seed money for the program, which gave loans and grants to families whose houses were foreclosed on by lenders, including in some case ones with ties to Fortress.

Still, Edwards sounded defiant when he was asked whether he regrets the work for Fortress.

“I don’t apologize,” he said. “Nobody ever gave me anything. I worked my rear end off, and I’ve been able to have some good luck and success in my life. I want everybody in this country to have this chance. I wanted my kids to have a better life. My parents wanted me and my brother and sister to have a better life. There’s nothing wrong with that. That’s America.”

Boston Globe 11/15/07
http://www.boston.com/news/nation/articles/2007/11/15/a_dark_diagnosis_reaffirmed_a_commitment/?page=6

More Foreclosure Ties for Edwards

For John Edwards, the negative returns from his work at an investment in a New York hedge fund keep on accumulating.

The State newspaper in Columbia, S.C. reportedthis week that a subprime lender that is part owned by Fortress Investment Group, Green Tree Servicing, has foreclosed on or is in the process of foreclosing on 132 homes in South Carolina since Edwards went to work for Fortress in October 2005. Edwards earned nearly $500,000 for part-time work as an adviser to Fortress last year, and has about $16 million invested in it.

The Washington Post reported in May that Fortress owned a large stake in Green Tree Servicing when Edwards joined the firm, and then purchased several other large subprime lenders while Edwards was at the firm. The article noted that Green Tree had been cited in trying to foreclose on New Orleans residents shortly after Hurricane Katrina, Edwards, who has spoken strongly against the predatory practices used by some subprime lenders and made New Orleans’ recovery a centerpiece of his campaign, said at the time that he was unaware of Fortress’ subprime holdings and that he was asking Fortress to look into any Green Tree foreclosures in New Orleans.

Last month, The Wall Street Journal reported that Green Tree and another lender owned by Fortress, Nationstar Mortgage, had foreclosed on 34 homes in New Orleans since Katrina. Edwards acknowledged that Fortress had not dealt with the issue as he had requested, and said he would divest himself of holdings in any Fortress funds invested in the lenders, and that he would also seek to redress the New Orleans families, either by paying them out of his own pocket or arranging for a nonprofit group to assist them.

Now comes the article on the South Carolina foreclosures, which hits close to home for Edwards for two reasons: he was born in South Carolina, and it will hold the first primary in the South, an election that Edwards needs to do well in to prove his point that he can outperform Hillary Clinton and Barack Obama in the South. The State quoted University of South Carolina political scientist Blease Graham, who said Edwards could be damaged by the appearance of inconsistency between his populist message and Fortress connection.
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Some issues like terrorism, health care and education are key topics from election to election, but signs are mounting daily that a new subject – financial security – will be central to next year’s presidential race.

Layoffs, mortgage anxieties and wild financial markets are now staples on the evening news, contributing to trepidation at a time when large majorities of voters have long said they believe the country is headed in the wrong direction.

Later today, AARP plans to release a “Divided We Fail” survey of a total of 5,000 of its members in five early voting states, and the data suggest that the candidates will be talking an awful lot about financial security, including savings, Social Security and pensions.

Half of those polled were Democrats and half of them were Republicans.

More than 9 in 10 of the potential caucus-goers or primary voters said financial security will be important to their votes, and between half and three-quarters called it “very” important. The survey is by Divided We Fail, a project of AARP, the Business Roundtable and the Service Employees International Union.

The poll covers New Hampshire, Iowa, South Carolina, Florida and Nevada, where AARP has a combined 4 million members. AARP will call attention to the results by holding events in each of the states on Thursday.

This seeming perfect storm of financial unease has already prompted some candidates and members of Congress to address the issue. Former North Carolina Sen. John Edwards has long made economic populism a central issue in his speeches and has a “predatory mortgages” policy.

However, the prominence of the issue has drawn attention his campaign did not want to a private equity fund for which he worked until last year. This week, The Wall Street Journal reported on 34 New Orleans homeowners who have faced foreclosure suits from units of the fund.

The Politico 8/23/07
http://www.politico.com/news/stories/0807/5485.html

Dodd Campaign: John Edwards May Not Take Money From Washington Lobbyists, But He Sure Acted Like ItContact:
Hari Sevugan
Cell - (312) 203-2207
Office - (202) 737-DODD (3633)Colleen Flanagan
Cell - (202) 744-7290
Office - (202) 737-DODD (3633)

* Edwards supported a bankruptcy bill that was vetoed by President Clinton. In 2000 John Edwards voted for the Bankruptcy Overhaul bill. While this bill included a slight increase of the minimum wage, its major design was to revise bankruptcy laws to make it easier for courts to force debtors to repay their debts, while before the law had allowed debtors to discharge their debt. 12 Democrats and 2 Republicans rejected this bill, including Chris Dodd, Ted Kennedy, Paul Wellstone, and Tom Harkin. President Clinton eventually vetoed this bill because it was too hard on debtors. [HR 833, Vote 5, 2/2/00; Des Moines Register, 3/16/01]

* Edwards voted for the same bill in 2001, again choosing financial interests over working families. In 2001 Edwards voted for a similar Bankruptcy Overhaul bill that again required Americans facing bankruptcy to undergo debt repayments instead of debt relief. Specifically, the bill required debtors able to pay $10,000 or 25% of their debts over five years to file under Chapter 13, which requires a reorganization of debts under a repayment plan, instead of seeking to discharge their debts under Chapter 7. Edwards voted with nearly the entire Republican caucus in supporting this bill, as well as voting to end debate on the measure. Chris Dodd voted to reject this bill, joining Senators Durbin, Feingold, Harkin, Kennedy, Kerry, and Wellstone. In all, the bill was rejected by 13 Democrats and 2 Republicans. [S.420, Vote 36, 3/15/01; S.420, Vote 29, 3/14/01]

* Edwards would not allow relief for people who were forced into bankruptcy from medical bills. Edwards also sided with the entire GOP caucus to vote against the Wellstone amendment to the 2001 bill. This amendment would have provided an exemption for debtors who were forced to file for bankruptcy due to medical expenses, under the rationale that health expenses are often unpreventable and can be an especially debilitating cost to low and middle income families. Chris Dodd was one of the 34 Democrats who voted for this amendment?a group that included Senators Clinton, Durbin, Feingold, Harkin, Kennedy, Kerry and Wellstone. [S.420, Vote 16, 3/7/01]

* Edwards rejected a means test amendment that would have protected debtors from sudden financial misfortune. On the same bill, Edwards again voted with the entire GOP caucus to reject an amendment that would have included a more consumer friendly means test than that included in the original bill. The amended means test would have used the average of a debtor’s last two months of income to determine their ability to pay a certain threshold amount of debt, instead of the last six months of income. The amended means test was designed to protect debtors who face financial difficulties from sudden job loss or disability. Paul Wellstone, who authored the amendment, said the original test “will make it impossible for families to rebuild their lives.” 22 Democrats supported this amendment, including Chris Dodd. Dodd was accompanied by Senators Clinton, Durbin, Feingold, and Kennedy. [S.420, Vote 33, 3/15/01; CQ Quarterly, 3/5/01]

* Edwards supported the final version of the Bankruptcy bill that “punishes the vulnerable.” Months later, Edwards again voted for the similar version of the Bankruptcy bill that emerged from negotiations with the House of Representatives. He also voted to limit debate twice on the bill, stifling further amendments or arguments. This version was not substantively different from the earlier versions, as it still made it significantly harder for working Americans to discharge their debts through the bankruptcy system. Chris Dodd rejected this bill, along with Senators Durbin, Feingold, Harkin, Kennedy, Kerry and Wellstone. 14 Democrats and 2 Republicans voted against the final measure. [HR 333, Vote 234, 7/17/01; HR 333, Vote 236, 7/17/01; HR 333, Vote 230, 7/12/01]

The bill “punishes the vulnerable and it rewards the big banks and credit card companies for their poor practices,” said Sen. Paul Wellstone, D-Minn., a leading opponent of the legislation. “We are heading into hard economic times and we’re going to make it hard for people to rebuild their lives.” [Associated Press, 7/12/01]

Press Release 8/19/07
http://www.iowapolitics.com/index.iml?Article=102959

The Dodd camp specifically pointed out Edwards voting actions on the Bankruptcy Overhaul bill in 2000. According to the press release, that bill would have essentially made it easier for courts to make debtors repay their debts rather than allowing them to discharge them. While Dodd and 11 other Democrats rejected this bill, Edwards voted in favor of it. Dodd even noted in the press release how President Bill Clinton vetoed this bankruptcy bill because it was too tough on debtors.

Dodd further questioned Edwards as a poverty fighter by saying that his opponent voted in favor of a similar version of the Bankruptcy Reform bill in 2001. Specifically, that bill required debtors to pay $10,000 or 25% of their debts over time under a Chapter 13 bankruptcy plan rather than letting them seek a discharge via Chapter 7 bankruptcy.

Questioning his opponent’s political allegiances, Dodd noted how Edwards sided with Republicans in favoring the 2001 bankruptcy bill. Dodd said that Edwards even aligned with the Republican caucus in rejecting an amendment to the bill by Senator Paul Wellstone of Minnesota. That amendment would have given an exemption to debtors who were forced into bankruptcy because of medical expenses. Naturally, Dodd was one of 34 Democrats to vote in favor of this amendment.

Edwards’ voting record on bankruptcy issues gets worse, according to the Dodd camp. Dodd detailed how Edwards once again lined up with the Republicans in rejecting an amendment that would have included a more consumer-friendly means test than in the original Bankruptcy Overhaul bill of 2001. That amendment would have initiated a Chapter 7 means test that would have averaged the debtor’s last two months of income and taken into account sudden job losses or disabilities. The original bill mandated a means test averaging the debtor’s last six months of income.

Dodd concluded the press release by saying that Edwards ultimately supported a bankruptcy bill that not only punished the financially vulnerable but also aligned with big banks and credit card companies.

Total Bankruptcy 8/19/07
http://www.totalbankruptcy.com/bankruptcy_articles_john_edwards.htm

DES MOINES, Aug. 17 — The John Edwards presidential campaign said on Friday that Mr. Edwards would divest his portfolio at a New York hedge fund of investments in subprime mortgage companies that have foreclosed on victims of Hurricane Katrina. But the campaign said he would keep his $16 million investment in the hedge fund, the Fortress Investment Group.

Mr. Edwards has frequently attacked such lenders for predatory practices that can tie poor people to loans they cannot repay, and has singled out lenders that have filed foreclosure suits against Hurricane Katrina victims. The Wall Street Journal reported Friday that Mr. Edwards had financial ties to such companies — ties that he now says he wants to sever.

“John Edwards believes that nobody in New Orleans should lose their home because of Hurricane Katrina,” said Eric Schultz, a spokesman for the Edwards campaign. “Edwards has taken personal responsibility by cleansing his portfolio of any investments that may have ties to these practices.”

The campaign confirmed, however, that Mr. Edwards would keep $16 million of his $30 million net worth in Fortress, a private equity fund with $43.3 billion in assets. The fund accepts investments only from institutions and wealthy individuals.

Mr. Edwards’s relationship with Fortress has become a recurring campaign issue. He worked as a consultant to the fund in 2005 and 2006, earning nearly $480,000 in 2006. He has received about $150,000 in campaign contributions from Fortress employees. And after becoming a Fortress consultant he shifted much of his family’s assets into Fortress funds.

Hedge funds like Fortress, which are thinly regulated pools of often risky investments, have come under increasing attack lately. They have been criticized for the high salaries they pay their top executives and for the role their subprime mortgage loans have played in the expanding credit crisis that is causing turmoil in the financial markets. They have also faced criticism for the low tax rate — about half that of ordinary income tax rates — on compensation paid their executives.

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Mr. Edwards’s relationship with Fortress is a potential problem, however, because of his campaign against poverty.

“It is self-evident that he is saying one thing on the campaign trail and investing another way,” said James A. Thurber, director of the Center for Congressional and Presidential Studies at American University in Washington. “He is the non-Washington insider candidate, but he will be seen as being tied to special interests, and that will hurt him.”
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There are plenty of causes for this sad heath-care situation. But Edwards wasn’t talking about one of the biggest causes - the cause he is among the most responsible for.

“The primary factor is liability insurance,” said Dr. Stuart Weinstein, an orthopedic surgeon at the University of Iowa. “It’s either too expensive in areas like that or simply not available anymore.”

Virginia’s medical-liability insurance rates - driven largely by the very types of lawsuits that made Edwards a multimillionaire many times over - have more than doubled in three years, according to the nonpartisan Medical Liability Monitor.

In Edwards’ home state, those premiums quadrupled. As a result, doctors have fled rural areas or quit practicing altogether.

New York Post 7/20/07
http://www.nypost.com/seven/07202007/news/columnists/edwards_got_rich_hurting_the_poor_columnists_charles_hurt.htm

Peter Edelman, a close aide to Kennedy, said that RFK wasn’t a candidate for president until well into his poverty tours, a notable difference from the tour of Edwards, a declared candidate for his party’s nomination for president in 2008.

Kennedy actually took many trips focused on poverty. One of his earliest trips was to California in 1966 for a Senate subcommittee hearing on migrant labor. He continued with subsequent trips to the Mississippi Delta and to an American Indian reservation in South Dakota. His final trip, to Kentucky, took place after he had announced his run for president in 1968.

“His purpose was to dramatize these conditions for the country,” Edelman recalled. “He had the ability to bring national television with him . . . The consequence of [Kennedy] seeing those severely malnourished children in Mississippi is that they were on national news that night.”

Similarly, this week’s “Road to One America” tour has drawn the biggest media crowds the Edwards campaign has seen since he and his wife, Elizabeth, announced the return of her cancer this spring.

Even if the media relay the message, some analysts wonder whether it will have the same resonance with voters.

Poverty is a different kind of problem than it was in the 1960s, and people have a different view of it now, said John Pitney, a professor of American politics at Claremont McKenna College who has written about Kennedy.

“We have billions of dollars in social spending that has happened [since the 1960s], and people are much more skeptical about the ability of government to resolve poverty,” he said.

The Swamp 7/18/07
http://www.swamppolitics.com/news/politics/blog/2007/07/invoking_rfk_a_delicate_operat.html