The Source

DED on Arrival: More Investment Catastrophes

Jay Nixon has a real problem on hands, and it’s not his kid.

News is coming out of Kirksville of another catastrophe brewing.

While this one is on a smaller scale than the Mamtek disaster, it’s not a good sign for the embattled Governor.

Both cases involve the Department of Economic Development (DED) and their loan guarantees.

After learning about the tax credit failure in Moberly that may cost the city millions, a TV station in Kirksville decided to check on a state tax incentive program in their area. In 2009, the state’s Department of Economic Development (DED) awarded a $1 million loan to a company called Wi-Fi Sensors.

In what now appears to be standard operating procedure, Missouri Gov. Jay Nixon visited Kirksville to announce the loan and to tout the promised jobs.

And Nixon’s press release on the matter stated:

The loan will allow Wi-Fi Sensors to expand its operation in Missouri. Under the terms of the loan, the company guarantees the creation of 40 new jobs and new investment of $4,069,000. While guaranteeing a minimum of 40 new jobs, Wi-Fi Sensors representatives believe they may create as many as 100 new jobs through this expansion.

But…

[The Kirksville] TV station visited the Wi-Fi property on Monday, and found nobody. According to its report, Wi-Fi missed its first payment to the state in November 2010.

Missouri Senators are calling for investigations into the DED’s role in the Mamtek fiasco. But they should be investigating this as well.

And others:

[E]arlier this year the DED awarded millions to a company for a development project that the courts had ruled as ineligible. […]

[And] the state auditor findings that the DED was inflating business creation and investment numbers reported for certain tax credit programs.

This is obviously more than an isolated situation, or even two or three isolated situations. This is a blatant failure of DED and Governor’s office, plain and simple.

Is this Jay Nixon’s jobs strategy? He throws his weight blindly behind every jobs opportunity that comes across his desk without forethought, making speeches, giving press conferences, issuing press releases, and pretending that the state isn’t in the shape it’s in.

He is taking our tax dollars and making terrible investments, and if it happened once (or four times) it has likely happened countless others. If the DED has been inflating numbers, and it’s obvious they have, you can count on it having happened repeatedly.

It would seem Jay Nixon has some explaining to do.

But ‘Will he?’ is the question.

- B.H.

American Jobs Act: No Co-Sponsors, No Problem

They call it the “Jobs Bill” or the “American Jobs Act”, but “Zero Liability” seems to be catching on as well.

What isn’t catching on is the bill itself, at least in the Legislature. The bill has been submitted, but not with a single co-sponsor in either the House or the Senate. It seems it wasn’t even submitted by choice.

…Connecticut Democratic Rep. John Larson has introduced President Barack Obama’s jobs plan in the House of Representatives “at the request of the president” and that the bill has no co-sponsors.

A bill that will cost taxpayers hundreds of billions of dollars with no co-sponsors that’s introduced “at the request of the president” doesn’t exactly lend credence to its contents. Then again, its contents weren’t even in existence when Obama waxed poetic for an hour about it earlier this month.

In his speech before Congress on September 8 to announce his $450 billion second stimulus, President Obama demanded over and over that Congress “pass this bill.” At the time he spoke those words, it later was revealed, there was no bill to pass—the White House had not finished drafting it.

The Democrats seem to publically support the bill but won’t put a single name on it, suggesting they are acutely aware of how unpopular co-sponsoring this load will be to their constituents come November next year.

They try to waylay this as a planned strategy by saying “We weren’t chasing co-sponsors.” But does that really fly?

The most accurate way to describe this bill is not exactly polite, so let’s just say: this is already one seriously giant mess.

And based on the catastrophes the previous attempts have been, that’s really saying something.

- B.H.

Nixon's China-Sized Problems

Most informed Missourians are acutely aware of the pending calamity with Jay Nixon’s baby: the St. Louis China Hub. (The tax incentive deal there is “on life support” according to Senate President Pro Tem Rob Mayer.) Gov. Nixon pegged the potential cost of that project in the wide range of “hundreds of millions of dollars.”

But another deal-gone-wrong with China has been mostly overlooked. It involved the (supposed) Chinese-American company Mamtek building a large sweetener factory in the small town of Moberly and it has been an absolute disaster, the kind that may lead to the bankruptcy of the city.

And Jay Nixon was behind this, too… even praising the deal as the headliner of a news conference last summer.

This ball of a scam got rolling a little over a year ago:

In July 2010, city officials and Mamtek — a Hong Kong-based company that said it spent five years perfecting a unique formula for the artificial sweetener sucralose — unveiled plans for a new plant. The company, with both U.S. and Chinese ownership, would create 120 jobs by Christmas and up to 600 more as assembly lines were added over the next few years.

Sounds like a good deal on the surface.

The catch was that the deal included $39 million in bonds, bonds that were backed by the city of Moberly. Nixon threw $18 million in tax incentives on top of the pile of money.

And the bigger catch was that the company may not have really existed in the first place, as one local reporter found out:

[Reporter Janet] Morales started digging, and she found some holes in Mamtek's story. While the company said it has a plant in Fujian Province, China, she could find no evidence of one. She contacted trade publications and competitors, and found no one knew of Mamtek.

But the local (and state) media chalked her up to some sort of radical… until this month.

[On September 1] UMB Bank put out a statement saying Mamtek had missed the first $2.2 million payment on city-backed bonds. A reserve fund covered the bill, but the city was put on notice: Fix this or be in default on the whole $39 million.

Moberly claims that the city will work through this problem and come out of it without too much damage, but the fact remains that they very well may end up on the hook for $39 million dollars for a factory that will never be, that may never have been.

In a town the size of Moberly, with a population of roughly fourteen thousand, that isn’t exactly an easy number to swallow.

Now Mamtek has fired its few employees, shut down its website, abandoned their Moberly office, and their new president is a bankruptcy lawyer from LA.

In hindsight, it turns out that several other Missouri towns backed away from the deal, weary of the promises of sweet satisfaction, as did the leaders of Bismark, SD:

Russ Staiger, president of the Bismark-Mandan Development Association, wanted Mamtek's sucralose plant in his town, too. At least at first. He had some phone calls with Mamtek's site consultant, and then Cole and company came to town. Staiger "wined and dined" them, he recalled, then got down to business.

"We wanted to see their financials. We wanted to see how much money they were going to put into it. We wanted to see some proof of this magic formula," he said. "They just were never forthcoming. It was like they were almost offended that we wouldn't take them at their word."

Mamtek moved on to Moberly, and Staiger didn't give them much more thought until the other day, when he heard that the deal went south. After his experience, he said, it wasn't a shock.

"My guess is those guys are halfway across the ocean in a rowboat by now," Staiger said.

If Bismark did their due diligence and walked away, why didn’t Missouri? The small town of Moberly may be somewhat excused for the oversight, being blinded by the idea of becoming an internationally competitive city and putting their town on the map… but can the Governor’s office?

And of Nixon’s administration screwed the pooch so poorly with this China deal, can we really trust that he knows what he’s talking about when it comes to the China Hub project in St. Louis?

But I do hear he's got a great deal in the works with some Nigerian Princes who emailed him last week, so I could be wrong.

- B.H.

"Bliss and Vinegar": KCSD Accreditation Mess

First the Kansas City School District lost the Superintendant and Board President over a spat, then word that the pathetic four of fourteen state standards they were meeting had been knocked down to three of fourteen, and now (not surprisingly) the state has stripped the KCSD of their accreditation.

The school district has been in dire straits for over a decade, having only re-gained a provisional accreditation in 2002 after over two years without, closing almost half of the schools in recent years due to a budget disaster, and the aforementioned exodus of the powers-that-be over the summer.

When taking all of these circumstances into account, the writing really was on the wall.

Though not entirely unexpected, the move was a painful return to reality for the city after a period of optimism that difficult choices were finally being made to confront longstanding problems in the school district…

“We’ve given Kansas City more time than maybe we should have to address the problems,” said Chris L. Nicastro, the state education commissioner, who had recommended the move.

The decision is effective beginning January 1^st. Some local pundits are predicting a mass exodus of students from the school district to charter and private schools or to schools in neighboring districts, exasperating the problem. Compounding that problem further, the cost of students who move to nearby districts will have to be covered by the KCSD, on top of the fact that Kansas City’s metro-area districts are at capacity already.

Kansas City was one of eighteen districts the state considered stripping accreditation from, but was inevitably the only district they singled out for punishment; a sign of just how bad things are. (St. Louis has been unaccredited since 2007, and a lawsuit is pending there that could complicate things in Kansas City even further.)

The school district will have two full school years to get its act together, meaning they have until June of 2014 to turn things around before the state steps in and either takes over or dissolves the district completely. Although, if recent history is any indication, things will not be pretty.

Full accreditation requires nine of the fourteen standards be met, and provisional accreditation requires six. Sitting at three right now, and on a downward trend, the prospects don’t exactly look promising.

But every action requires an equal and opposite reaction, right?

Michael Casserly, executive director of the Council of the Great City Schools, which has advised the school district, was taken aback by the decision. “I think things have settled down and the reforms continue apace in Kansas City, so I’m not quite sure what the rationale was for their decision.”

Ignorance truly must be bliss.

So now the children of the KCSD, caught in the middle of this city-sized mess, are learning important lessons on bliss every day as ignorance spreads through the school district like wildfire.

And with such rampant ignorance and hard-to-swallow issues becoming the norm, is there any argument that the new motto of the KCSD should be “Bliss and Vinegar”?

- B.H.

Gov. Nixon Ready to Plug Missouri’s Court-Hole

With a Missouri Supreme Court vacancy looming on the horizon, Jay Nixon has a major decision on his hands that will leave a lasting impact on the state… like the Moberly sweetener factory did.

As the statewide unemployment rate ticks up bit by bit Jay Nixon has found the one job that he actually can create for someone, but who will he eventually choose?

For a Governor as inscrutable as Nixon, a politician who would take $170,000 from dirty lawyers suspended by that very Supreme Court, the people of Missouri can surely rest assured that he’ll pick the right man for the job. After all, he’s already worked so hard to narrow the list down to three knockout contenders.

The first of three contenders is a standout. That would be class-act class action attorney Joe Jacobson of St. Louis, who is currently defending allegations that he coached five TWA pilots to lie during trial.

Jacobson would obviously be a great choice for Nixon’s close circle. He could sling back beers with those incorruptible top donors Carey & Danis while they crack jokes about all the “clean” tricks they pulled in court.

The second contender, Jackson County Circuit Judge Michael Manners of Independence, has his own issues as well… issues that Joe Jacobson didn’t mind pointing out while being interviewed about his own indiscretions. Turns out Manners has been sued numerous times as a lawyer and as a judge. Top-notch to say the least.

But then there’s Missouri Court of Appeals Eastern District Judge George Draper III. Much like the Governor’s son, he had a father in high places to take care of his getting high in interesting places. That’s right, he’s got a bit of a past with the Mary Jane.

In response to a question on his application, Draper answered with the following:

In approximately 1974, at the age of 20, while on spring break in the Bahamas, I was arrested for possession of a minor amount of marijuana. I paid a fine and upon returning to the United States, was confronted by my father, also an attorney, who had received a letter from the Bahamian government. After my father’s admonishment, my father advised me that he would take care of this matter by having it removed from my record.

And there you have it: Nixon’s three top candidates to fill the highest court in the state.

The best of the best.

God help us all.

- B.H.

NIXON: Return the Dirty Money

Don’t let “Governor” Nixon’s fundraising numbers fool you.

Over the last two weeks he raised $135,000… but the kicker is that the entire total came from just THREE donors. And if you break that down you’ll find that the vast majority of the funds raised – $100,000 of it – came from one company.

What company might that have been? The scum-of-the-earth personal-injury law firm Carey & Danis, that’s who.

Sure, lawyers aren’t exactly the most revered “professionals” in American society, but this law firm really does take the cake when it comes to sheer nastiness. Actually, they take the cake and eat it, too.

You see, both of these scumbags personally represented Chrysler for years with another law firm, learning all of the corporate secrets they would need to turn around and use against Chrysler in a class-action lawsuit just a few years later.

In fact, their dirty (and very illegal) tricks caused the Missouri Supreme Court to suspend their sorry asses. Directly from the MO Supreme Court judgment:

The Chief Disciplinary Counsel (CDC) filed a three count information against attorneys John J. Carey and Joseph P. Danis based upon their alleged professional misconduct in prosecuting product liability class action suits against a former client, the Chrysler Corporation, and in making misrepresentations in discovery in the subsequent lawsuit for breach of fiduciary duty brought by Chrysler against them.

We find that both John Carey and Joseph Danis engaged in professional misconduct by representing another person in a substantially related matter adverse to the interest of a former client in violation... and by making false discovery responses in violation... John J. Carey and Joseph P. Danis are indefinitely suspended from the practice of law, with leave to apply for reinstatement not sooner than one year from the date of this opinion.

Their law licenses were suspended effective November 26, 2002 after being found guilty of withholding evidence and violating their duty of loyalty during the Chrysler escapade. (They were reinstated on April 26, 2004.)

Jay Nixon should immediately return the entire portion of the $100,000 blood-money donation from these despicable “lawyers”.

(Giving the $70,000 worth of previous donations back wouldn’t hurt, either.)

As the governor Jay Nixon is tasked with upholding the rule of law, yet it seems that this law firm is his number one donor. There is no way he can even pretend to respect the rule of law while at the same time taking $170,000 from a pair of disgraced lawyers who have been suspended by his own state’s supreme court for so flagrantly violating the laws he has sworn an oath to protect.

Enough is enough “Governor”. Have some decency and return the money.

- B.H.

High Times with the Nixon Family

Hearing the news that Governor's son was issued a citation for marijuana possession, it gave us pause to reflect upon the past drug misadventures of the Nixons, which start with the head of the family. In 1992, Nixon first admitted to using marijuana in high school, and only months later his campaign admitted it was fudging the truth and that Nixon was a marijuana user in college too. (Post Dispatch, 4/24/92, 9/22/92)

Hearing about Nixon's crackdown on fake pot might lead you to think he's tough on drugs, but in 2003 he supported letting local governments limit fines and penalties for possession of the real stuff. (Post Dispatch, 1/27/03) His foresight was remarkable, given that only eight years later his son would be benefiting from the extremely lax marijuana laws in Columbia.

We have to wonder what the family conversation the next day was like; was Nixon upset about the bad headlines, or did he give his son a high five for keeping the family legacy alive? 

Rick Perry vs. Obama: Picture Worth a Thousand Chuckles

I've had this come across a few email accounts and thought it worth sharing (if you haven't seen it already)...

Classic.

Now I wonder who would make the better President... tough question.

- B.H.

Army Corps: Bad News Masked as Good

Leave it to the Army Corps to even screw with the press about the historic Missouri River flooding.

Here’s the first line from the article:

The US Army Corps of Engineers says the Missouri River flooding is ending.

And the last line of the article:

The statement by the Corps says it hopes to have the water releases along the Missouri River back to normal around December.

Three additional months of having a flood bearing down on you is not exactly an “end” to the flooding. (And I’m no weather expert, but considering what the weather and temperatures are prone to do that late in the year, standing shallow water could quickly become ice and subsequently a much larger problem for northwest Missourians.) Just ask residents of Holt County, who apparently have “an area the size of the city of Chicago underwater.”

The end-all be-all of it is that we are far from the end-all be-all of it.

It’s just another example of an inept government bureaucracy lying to the people to look better than they could ever be, all the while destroying American lives because of the shortsighted decisions they have made.

But just because it’s typical government behavior doesn’t mean it should be accepted.

- B.H.

Black Caucus Goes Overboard, West Targets Cleaver

KC Rep. Emanuel Cleaver, Chairman of the Congressional Black Caucus, has been served a “sugar-coated Satan sandwich” (now with Demon Drink!) by Allen West in the form of a letter of condemnation over CBC members stepping way over the line at recent events:

Rep. Allen West, the only Republican member of the Congressional Black Caucus, threatened Wednesday to quit the group over what he called “racially motivated rhetoric” by fellow caucus members aimed at the tea party.

[…] In a letter to CBC Chairman Emanuel Cleaver, West scolded his colleagues and called on Cleaver to “both condemn these types of hate-filled comments, and to disassociate the Congressional Black Caucus from these types of remarks.”

“Otherwise, I will have to seriously reconsider my membership within the organization,” West wrote.

First came the always-nutty Maxine Waters waxing poetic about the Tea Party in general:

[West] took issue with that comment and with remarks made by Rep. Maxine Waters (D-Calif.) who recently said at an event in Inglewood, Calif., that “the tea party can go straight to hell.”

And then there was racism run amok when Andre Carson took the stage in West’s home state of Florida:

At a recent Congressional Black Caucus event in Miami, Rep. Andre Carson, a Democrat from Indiana, was videotaped telling the audience that, “some of them in Congress right now of this tea party movement would love to see you and me… hanging on a tree.”

[…] At the Miami event, Carson suggested that the tea party aims to return to the days of segregation.

 “This is the effort that we’re seeing of Jim Crow,” he said. “Some of these folks in Congress right now would love to see us as second-class citizens.”

Maxine Waters is inflammatory every time she opens her mouth, but the comments by Andre Carson are not just surprising because of his emergence on the national scene of Tea Party bashing, but because of the violent imagery and pure racism his comments inject into the debate in the form of Jim Crow and lynch mobs.

“Congressman Carson’s desire to generally criticize a large grass-roots group as racist is baseless and desperate,” [West] wrote. “When individuals believe they are defeated in a political disagreement, they normally resort to race-baiting, which in my opinion is in itself racist.”

And if you won’t take my word, or Allen West’s, that this is over-the-line and flat-out racist rhetoric, just ask the hard-left political writer over at BET, who embraced the truth of the situation, writing:

[H]aving to agree with West about anything is difficult for me, but he’s completely in the right on this one… there’s a big difference between different views and wanting to violently lynch African-Americans… You can’t ask Tea Partiers to stop calling the president a Muslim and then turn around and call Tea Partiers a bunch of Klan members. Civility only works when it’s shared back and forth. Otherwise you’ve got hypocrisy all around.

Well played. Sadly Allen West won’t be getting any kind of response soon as the CBC has issued a response saying they’re declining to issue a response. (Try figuring that one out.)

Not that anyone should be surprised… Emanuel Cleaver is spineless and if the CBC admitted that racism cuts both ways they’d be out of talking points by the weekend.

Here’s hoping Allen West walks.

- B.H.