Category Archives: economy glory and vainglory

Celebrating One-Year Anniversary Of My UK Ban

Last picture in Jersey (before being banned)

Feeling grateful for supporters in the UK and around the world who have demanded my UK travel ban be overturned. Because of you — and the help of UK Member of Parliament John Hemming, it expires today.

To mark the ban’s one-year anniversary, Trevor Pitman, member of the parliament of Jersey (the British Crown dependency where I was conducting research before I got the boot) launched a petition on Change.org, urging the UK government to restore my UK Tier-1 visa.

Without this, it is unlikely I will be able to finish my work. Please, if you believe in defending a free press, take 10 seconds to sign this petition. Surrounded by ocean, Jersey has been isolated in its struggle for a free and fair democracy for far too long. It should be able to welcome journalists, not ban them.

#FreeJersey: A Small Island Fights For Its Democracy

The Jewel Of The Channel Islands

Almost everyone has heard of New Jersey, but few people have heard of “old” Jersey — the 5-by-9-mile island just off the coast of France that belongs to the British Crown and is best known for its wonderful Jersey cream, cows and potatoes.

What it is less known for: Jersey stows more tax-shelter money than any other offshore financial center on the planet.  (That’s right, more than the Cayman Islands, Bermuda, Guernsey, the Isle of Man, the British Virgin Islands, you name it.) In fact, name any global bank or quote-unquote paragon of finance and it will almost certainly have some kind of presence here.

For hundreds of years, Jersey was torn asunder by the territorial pissings of England and France — an accident of geography, really, since the island lies in the English Channel between the two countries. As a result, its roads all have very long, ornate French names, but the people of the island speak the Queen’s English.

Another result: the island has an institutional memory of war, not excluding its status as a major base for Germany in WWII (which regarded Jersey as a great jumping-off point for the final showdown it was planning with Britain). Because of this, Jersey has learned to be extremely wary of outsiders.

Jersey: Tiny, But Complicated

Jersey is a self-governing, parliamentary democracy under a constitutional monarchy with its own financial, legal and judicial systems. Its currency is pegged to the British pound, but it prints its own money, votes for its own senators and makes its own laws. Indeed, Jersey has an extremely polished external image that has earned it a very high ranking among the world’s tax havens, but internally its democracy appears to be foundering.

As someone who fell in love with Jersey when I was living in the UK, I have friends on the island and found myself looking into the problems there. A flashpoint in my research was the scandal surrouding an orphanage called Haut de la Garenne, where unspeakable violence, abuse and possible murder took place against children for decades — and yet the government did not stop it. An investigation finally undertaken in 2008 was shut down and the chief of police was suspended — twice — which seemed gratuitous. Those who stood accused largely went untried, but when the island’s health minister objected to this — and would not stop objecting — he was jailed. Also twice. Some of those who were labeled “priority suspects” by the island’s police are now working in high-level government positions in health and education where they continue to have indefensible access to children.

Jersey’s Campaign

Exactly one year ago today, I was banned from the UK as a result of my research into these events. I have continued my work from the U.S. and have had many outstanding supporters in the UK who have kept me going. Among them are Deputy Trevor Pitman, a member of Jersey’s Parliament, who put up a petition today in support of my return. If you believe in the power of the press and the right of even a very small, insular island to stand up for its democracy, please sign this petition (ten seconds) and spread the word. My ability to do my job in this case depends on it.

Today, my travel ban will expire due to the efforts of UK Member of Parliament John Hemming. But I will not be able to work safely until my UK visa is restored. Hence, the reason for Deputy Pitman’s petition (which, if you haven’t signed it yet, again, here it is: http://chn.ge/QCp7qy).

In addition, a group of Jersey citizens — including bloggers, current and former elected officials and concerned residents of the island — have issued a statement of solidarity this afternoon. It is their hope that by joining forces online, where they can best reach the international community for help and support, they can make a stand in defense of their island’s democracy. Featured on the Web site of Neil McMurray, one of the lead bloggers, I have posted their statement here:

Jersey’s Citizen Solidarity

Today is not a day to focus on right-wing versus left-wing politics, but the difference between right and wrong.

When a democratic government abuses its substantial legal, legislative and financial powers to crack down on journalists’ freedom of speech, force policemen and elected officials from their jobs and systemically dismantle its own checks and balances so as to deny each of its targets due process, clearly it is a government that has lost its way.

Jersey, the jewel in the crown of the Channel Islands, may be one of the world’s leading offshore financial centres, but it has begun to use its clout against its own people –and it is keeping the rest of its population in the dark about it. This is now a place where court and legislative records – those that are public anyway – can now be redacted. This is an island where secret trials are now allegedly taking place and elected officials are forced to debate key issues in secret. Web content is banned and journalists booted out. This is not the way a democratic government is supposed to be run.

Again, this is not about politics. It is about standing up for truth, honesty and integrity. It is about restoring the good name of our beautiful island whose reputation has been dragged through the mud by those attempting to cover-up the facts surrounding some of the most heinous crimes known to man – crimes of violence against children. Crimes the vast majority of islanders would never defend, yet most of those who stand accused of committing them have not been brought to justice and continue to walk among us and our children. Worse, these alleged perpetrators remain entrenched in some of the very highest echelons of Jersey’s government –working in departments that focus on children. It is beyond comprehensible.

On an island where children in need of care have been let down by the government for decades – and continue to be let down – we cannot afford to ignore or repeat our mistakes. More broadly, challenging the government’s current decisions, particularly when not made in the best interest of the public, should not require bottomless financial resources and friends in high places. We are supposed to be a democracy, right?

With our checks and balances hamstrung, the international and independent media may be our last chance at reclaiming our democracy and re-establishing rule of law.

Today, Jersey politician Deputy Trevor Pitman launched an e-petition on Change.org in support of the return of U.S. investigative journalist and author, Leah McGrath Goodman, to the island to continue her research into decades of child abuse at Jersey’s state-run “care”homes and allegations of cover-ups in the wake of the government’s removal of the chief of police and shut-down of the investigation.

One year ago today, Ms. Goodman was banned from the UK and Jersey for two years after revealing to the Jersey Customs and Immigration Service during a voluntary meeting that she was writing a book on atrocities against children at Haut de la Garenne. According to the UK Border Force, she was flagged by Jersey Immigration authorities for removal upon her next border crossing – and that is exactly what happened. After the intervention of UK Member of Parliament John Hemming, the ban was reduced to one year and it expires today, 11 September 2012. That said, the UK and Jersey have so far declined to restore Ms. Goodman’s visa or allow her cross the border to continue her research. In order to do so safely, she will need to have her Tier -1 visa status fully restored – hence, the reason for Deputy Pitman’s e-petition.

Leah McGrath Goodman should be permitted to complete her work in order that there is an accurate record based on the available facts and evidence. Jersey needs to confront the failings of its past so it can redress them and, most of all, ensure the safety of our children’s future.

We ask readers who care about the island’s children, who care about the island’s reputation, who believe in a free press and who want the truth to be told to sign Deputy Pitman’s e-petition. We also ask fellow bloggers to copy and paste this blog onto their own Web sites so that we may show the world that Jersey wants the best for its future and its children. It is time to leave our island’s culture of secrecy behind and demand the kind of free and open society our island deserves. Those who would do otherwise are not representative of the majority of islanders.

Please spread the word and sign this petition. The Internet is the one thing Jersey authorities have not been able to lock down. For those who tweet this campaign, please use the #FreeJersey hashtag.

While Jersey may try to keep journalists out, it cannot keep us for letting the truth in.

 

Picking Your Poison

...And yet nuke is green.
I was in fifth grade the year of the Chernobyl disaster. I watched with morbid rapture all the great nuke movies — Silkwood with Meryl Streep, Marshall Brickman’s Manhattan Project and Hal Hartley’s Trust (which is as amazing as it is impossible to find). I grew up believing that nuclear energy — despite being low-carbon and, well, cheap — was most definitely not the answer to the world’s energy problems. But then Jean-Christophe Nothias, editor-in-chief at The Global Journal, asked me to do the story excerpted below. Here’s why my entire worldview on nuclear changed.
Since 2001, a project has been underway to determine ‘alternative’ nuclear technologies, conducted by a large group of scientists from over 15 nations. The list of specifications is very demanding, but with a simple objective: can science provide radical new solutions to allow us to dispense with ageing second- and third-generation nuclear technologies? The group came up with a set of discoveries promising remarkable advances. So, why does no one talk about them? Nuclear energy, it seems, remains a sensitive subject at the global level. Our reporter, Leah McGrath Goodman, decides to throw some light on the matter.

A Strange History

It is a little-known fact that the heavily guarded, Cold War-era fortress that houses the U.S. Department of Energy (DOE) in Washington is named after – as one official jokes without a trace of irony – “a deeply depressed man.”

That man, General James Forrestal, former Secretary of the U.S. Navy, died in 1949 under strange circumstances. Depending on whom you believe, he was either assassinated or committed suicide by tying the end of a bathrobe sash around his neck, the other to a radiator, and throwing himself out of a hospital window. His body was found, shirtless, on a ledge, in an alley. The investigation into his death was marred by rumors of foul play, but he apparently left a suicide note… Continue reading Picking Your Poison

Anarchy In The UK?

Haut de la Garenne, Jersey, 2011

The following story was commissioned by The Guardian after I was detained, questioned and banned from the United Kingdom in the wake of research for my next book in the Channel Islands, a $1 trillion tax haven off the coast of England. Many of you have asked what I have been working on — this is what I have been working on. My misadventures, along with those of several others whose names I am honored to see mine beside, are cited in The Guardian’s print edition today. I am fine, although I may now be the only member of the London Speaker Bureau not allowed to speak in London. I will truly miss the UK’s savory fish pies.

When I was 29 and first embarking on my writing career in London, I discovered a beautiful island off the coast of England that I would return to many times in the years to come. Jersey not only has heavenly beaches and culinary delights, but the people of the island are some of the loveliest I have known. After a busy week in the City, a puddle-jump flight could see me there in less than an hour, soaking up the sun on the white sands under wildflower-draped cliffs. The island’s locals would sometimes hint that Jersey’s pristine exterior belied a dark side. But I couldn’t imagine it. How could a place with such warm people have a dark heart?

When I returned to the U.S. in late 2008 with my first book contract, it came as a shock when I witnessed, from a distance, Jersey’s horrific child abuse scandal. Day after day for weeks, I watched the deputy chief of police, Lenny Harper, give interviews to a crush of international press outside the shuttered orphanage of Haut de la Garenne. Harper seemed increasingly alarmed over the human remains his team was finding inside, although what to make of them was hotly debated by the media.

The islanders, who are quiet people, were quietly devastated. The notion that, for decades, their children’ homes might have been used as a sexual cafeteria for the rich and privileged – as hundreds of the victims contended – was distasteful in the extreme. During the probe government officials repeatedly stated that they fully intended to run a thorough investigation. Yet, within months, Harper and his boss, the island’s head constable, Graham Power, had been smeared by the local newspaper, The Jersey Evening Post, as unfit for their jobs and driven from the island. Their main advocate, Senator Stuart Syvret – then-health minister and one of the island’s most popular politicians – also found himself under siege, eventually sacked and jailed twice. The cases made against each man were as flimsy as the headlines were flashy.

It seemed that anyone who attempted to stand up for Jersey’s underprivileged or conduct a proper investigation into their treatment soon found themselves in the fight of their lives.

Evidence found at Haut de la Garenne – including bones that were “fresh and fleshed” before being burned and dozens of children’s teeth with the roots still on them in the furnace area – was turned over to a new police chief who downplayed its significance but also admitted to throwing some of it out. As an investigative journalist, I found it hard to understand how this could possibly inspire confidence. It seemed the situation needed to be looked at by someone without an axe to grind or an ass to save.

After I passed in my first book, which also focused on cultures of corruption (The Asylum: The Renegades Who Hijacked The World’s Oil Market, HarperCollins 2011) I began to travel to the UK on a regular basis to conduct interviews with the victims, senators and law-enforcement officials.

This is where my own troubles began… Continue reading Anarchy In The UK?

Oil and Gas Politics: Just The Nonpartisan Facts

I’ve been writing a series for Fortune in recent weeks tackling questions like, if the U.S. is now selling more petroleum products than it is buying for the first time in more than six decades, why is most of the country paying around $4 a gallon for gas? And if 30% of U.S. oil is drilled from federally owned lands and territories (read: areas owned by us, the taxpayers) why are we not being paid competitive rates for them by the oil companies? 

With the Senate recently voting down a measure to eliminate billions of subsidies for Big Oil, for those not looking to attack either Republicans or Democrats, the 1% or the 99% – just those operating on common sense – it should raise some questions.

Between 2007 and 2010, more than 70% of the increase in U.S. oil drilling took place on federal territories, representing 3.5 million barrels a day, according to the nonpartisan Congressional Research Service. Since then, oil drilling in the U.S. has climbed higher, topping 6 million barrels a day  this spring for the first time since 1999.

The appeal of drilling in the U.S. has grown in recent years, as oil companies develop new technologies to capture energy resources locked in North America that were previously seen as out of reach. Big Oil also has grown wary of the legal and financial uncertainties that often plague their drilling activities in more exotic and restive regions, such as Venezuela and Nigeria, North Africa and the Persian Gulf.

Bottom line: drillers see America as the promised land compared with the dreary alternatives, because the U.S. is by far a safer and stabler place to do business.

Oil Still Fetches 1987 Rates

Yet Americans might be shocked to learn how much the oil companies are actually paying for the privilege to drill on taxpayer-owned territories. As of this writing, the starting bid for leases on parcels of land that allow an oil company to drill for 10 years is $2 an acre. Yes, the prices can get up into the thousands during the bidding process, but more often the land is sold for next to nothing.

And it’s been that way since 1987.

It is as though oil hasn’t budged from $20, the price per barrel the same year Bon Jovi released “Slippery When Wet” (no pun intended regarding the use of ‘slippery,’ however apropos.) Continue reading Oil and Gas Politics: Just The Nonpartisan Facts

The Boy Wonder At The Heart Of A Disaster

Something to inspire your Friday: The story of a 30-year-old from Sunrise, Florida, who’s defying Wall Street — and not getting hit with a nightstick for it.

Who is James Koutoulas and how did this 30-year-old end up leading the charge to recover more than $1 billion for customers from one of Wall Street’s biggest bankruptcies?

By Leah McGrath Goodman, contributor

FORTUNE — James Koutoulas walked into one of the worst bankruptcies in U.S. history with almost zero legal experience.

“When I got up the first day in bankruptcy court and saw the look on the judge’s face, I couldn’t blame him,” he says. “Bankruptcy court is a rich man’s club where everyone is old, so I stood out. Honestly, when I’m shaved, I look like I’m about 12.”

Yet Koutoulas, 30, may be one of the only former customers of MF Global, the now-defunct futures brokerage house, with the gumption to publicly object to the way they are being treated. Since filing for bankruptcy Oct. 31, MF Global’s woes have rapidly piled up – chief among them losing an estimated $1 billion-plus of customer funds. The loss directly crimped the wallets of some of the futures market’s most active participants, from small-time farmers to ranchers to hedge funds.

Koutoulas, chief executive of three-year-old commodities fund Typhon Capital Management, stumbled into the courtroom drama accidentally. His Chicago firm, which conducts the bulk of its business in the futures market, discovered shortly after MF Global’s bankruptcy that $55 million of its $70 million under management had been dragged into the proceedings. This was a surprise, because, by law, customer funds are supposed to be kept completely segregated from a brokerage firm’s own assets. That wasn’t the case with MF Global. For Koutoulas and tens of thousands of other MF customers, it was a rude awakening.

“My goal is real simple: getting everybody’s money back,” he says. Continue reading The Boy Wonder At The Heart Of A Disaster

PAST PERFORMANCE IS NECESSARILY INDICATIVE OF FUTURE RESULTS

S also stands for 'sinister,' 'scurrilous' and 'slippery'

It met rarely and whined often. It gave up before the actual deadline (Nov. 23). It sought to shear over a trillion off the national budget, but came up with peanuts. It inspired satire in the form of, among other things, superhero cartoons. It was the “supercommittee.” For these reasons and so many more, America’s elite political body truly lived up to its name in that was super-lame.

This again proves that when Congress gets together and can’t make a deal, guess what? Moving the date back and getting together again — on the taxpayers’ dime, replete with catered lunches — still doesn’t lead to a deal. Funny how that works.

Whenever confronted with the need to make an actual decision, Congress prefers instead to commence lengthy studies, probing inquiries and cerebral surveys — all of which require much munching and lunching and the drinking of fresh coffee and spring water — that rack up bills yet infrequently give rise to any answers… Continue reading PAST PERFORMANCE IS NECESSARILY INDICATIVE OF FUTURE RESULTS

How To Make Someone Else Swallow Your Losses, The Mastercourse

It’s official: when a Wall Street powerhouse suddenly collapses and (possibly) more than a billion dollars goes missing, it’s no longer just the ordinary taxpayer’s problem. Now, it has moved up the chain. Below, the piece I wrote today for Fortune on what traders do when you misappropriate their money.

While Occupy Wall Street was holding its two-month anniversary rally in Manhattan last week, traders were quietly mounting a rather more sophisticated version of OWS on their own. Call it Occupy Wall Street Bankruptcy Court.

FORTUNE — Big institutional investors are getting a taste of what many frustrated taxpayers experienced during the financial crisis: Being on the hook for losses of a major financial firm against their wishes.

This time, of course, it’s MF Global at the center of the dispute. A once-trusted brokerage with roots dating back to the 1700s, MF Global is now a bankrupt firm suspected of misappropriating customer funds to the tune of at least $600 million.

More than two weeks after MF Global’s Halloween bankruptcy filing, there are more questions than answers and a surfeit of conflicts in an investigation that should be aiming to restore the public’s confidence, but is doing the opposite. On Monday, the bankruptcy trustee for the case announced that there may be much more than $600 million missing from MF Global accounts — perhaps as much as $1.2 billion.

Hundreds of millions of dollars of trading capital and collateral were frozen without notice, dramatically disrupting the derivatives marketplace and ushering in a phalanx of federal prosecutors, regulatory agencies and forensic accountants working around the clock to determine where the missing money is. This, after a lawyer for MF Global assured a New York judge earlier this month “there is no shortfall.”

What’s different about this case?  One hedge fund executive summed it up best: “What is scary about MF Global is that there is no political will in this country to look out for people. Let this be a lesson that, if someone tries to steal from you, there is no one who is going to save you. I mean it is literally the most frightening thing that can happen in finance.”

Led by a sense of outrage — as well as the conviction that if they don’t look out for themselves, no one else will — investors have been pooling information and banding together to defend themselves for weeks. Continue reading How To Make Someone Else Swallow Your Losses, The Mastercourse

Good News From Francis, The Lamp Man

Leg up?

Sometimes there’s a need to find a good lamp guy. The guy the other lamp guys go to who really knows where it’s at. That guy is Francis Nowalk of Pittsburgh (or for those of you who want to get persnickety about it, Bloomfield, PA, the Little Italy of Pittsburgh).

Francis has a massive stone building that looks more like a cavernous school than a shop. In it, he keeps scores of lamps, old and new, on which he assiduously works with the help of big, heavy machines.

If you are nice to him, he’ll sneak you past a pair of handsome, leather-encased, brass-studded double doors in the back to his secret stash of high-end chandeliers.

I happen to be living on the second floor of a Victorian house in a Norman Rockwell town. During the day it is glorious, but at night it can be a little scary. Whenever I descend the long stair in the evening for wine on the porch with friends, I am unsettled by the pervasive darkness of the foyer. Perhaps it is the old-house vibes; perhaps it is just my imagination. But I don’t care for it. So I began looking into alternatives.

At the base of the bannister where the handrail terminates there used to be a Newel post lamp. In Victorian times, it just wasn’t enough for a balustrade to end, it had to finish off magnificently. As a result, it became a place for the layering of carved finials, lights and small-scale figural sculpture.

For me, the light part was what I was after. Continue reading Good News From Francis, The Lamp Man