Sunday, March 16, 2008

The Real Story in the Spitzer Case

As usual, the Spitzer story is getting the shallow treatment while the most interesting aspects of the story are glossed over or ignored. The focus is on the salacious ---- how much was he spending; what does "Kristen/Ashley" look like in a bikini; why do politicians wives take this abuse? Who cares? The real story is how Spitzer was caught. Big Brother really is watching and we should all be afraid, very afraid. In fact, some elements of the story do have a "1984" quality to them. According to Phillip Carter, a New York lawyer, and author of an Intel Dump blog post, Spitzer was nailed by the Bank Secrecy Act, which was passed in 1970. I am troubled about how he was caught and believe that it illustrates how all of these government “reporting” laws can be used for other than their claimed purposes. Step 1 pass a law that casts a wide net and results in all kinds of reports of "suspicious activity." Step 2 sift through the nets looking for "leads." Step 3 go on a fishing expedition focused on a promising lead generated by nothing more than the most general of suspicions. Is this really probable cause or just a pretext for an investigation?

It seems that because Spitzer was governor of New York his bank flagged him as a “Politically Exposed Person” (PEP) who was at “higher risk” for “financial crimes.” Apparently, PEPs are subject to higher scrutiny internationally and banks may be fined for failing to report on them. This ought to make you think twice about seeking public office. If you're elected, you are automatically deemed to be under suspicion. Because the money Sptizer was moving around was below the $10,000.00 reporting limit, his bank's computer surveillance systems flagged them for possible structuring. So the bank reported him to the IRS for possible structuring to avoid the Suspicious Activity Reporting requirements of the so-called “Bank Secrecy Act.”

That name "Bank Secrecy Act" is Orwellian. It ought to be called the “Bank Total Lack of Privacy Act.” Anyone who has ever read “1984” will recognize “Bank Secrecy Act” to describe a law that requires your bank to spy on you as Newspeak,. Newspeak is words “deliberately constructed for political purposes: words, that is to say, which not only had in every case a political implication, but were intended to impose a desirable mental attitude upon the person using them." It is also what we call Doublespeak. The fact that our government frequently uses Newspeak/Doublespeak (e.g., “Patriot Act”) has always troubled me. "Patriot Act" is Newspeak, but the "9/11 Counterterrorism Act" would've avoided Newspeak and been accurate. The fact that the government would rather give it a Newspeak name for marketing purposes when perfectly good names suffice worries me.

Spitzer’s bank reported him to Federal authorities not because he broke a law, but because as a politician his banking transactions were already automatically suspect. The “Bank Total Lack of Privacy Act” imposed a duty to report a general suspicion to the government. That gave the pretext to investigate the Governor of New York generally, including wiretaps. The wiretap is how they found out about the call girl connection. Keep in mind too that it gave the Republican controlled Executive Branch of the Federal government a pretext to wiretap the phones of a very powerful elected Democrat. There is no reason to suspect that this was a politically motivated surveillance of an opposition politician. I'm not a conspiracy nut. I think it was just a lucky byproduct of the wide net cast by the Bank Total Lack of Privacy Act. However, you don’t have to make much of a leap in logic to see where this easily could be abused. As is often asked, "You're comfortable that George has this power? Okay, how will you feel if Hillary gets the power?" Who needs to break into the Watergate when you’ve got so many opportunities for pretextual investigations based on the volumes of crimes enshrined in the U.S. Code?

People think that prominent public figures are “above the law” and always “get a break.” This is an example though of what really happens --- they’re held to a higher level of scrutiny and when caught get slammed so no one will look like they’re “going easy” on them. Spitzer could be charged with violations of the Federal Mann Act because he paid a call girl to travel from New York to meet him in Washington, D.C. The Mann Act was intended to address “white slavery” and pimps. Coincidentally, Reason magazine just happened to feature an article entitled "The 'White Slavery Panic'" in its most recent edition.

The Mann Act could be used here to charge Spitzer with a felony for what would have been a misdemeanor if he’d gone down to the corner and picked up a hooker. Alternatively, he could have gone down to the Mayfair Hotel bar and picked up a woman of easy virtue for dinner and drinks and committed no crime at all. Better yet, he could have just hit on some impressionable young intern in his office because that’s “just sex” even when you lie about it under oath. If you take advantage of a much younger intern, you not only don't have to resign, but the press defends you AND you can be sanctimonious about your indiscretions too.

Ben Stein commented on the insidiousness of this investigation on CBS News Sunday Morning this morning. The title of his piece was "Elections More Important Than Call Girls." His take on it was that the normal penalty for sex with a prostitute is a misdemeanor. The "john" is usually fined. The penalty does not involve deposing an elected official. In his opinion, the democratically elected governor of New York was run out of office by some nosy unelected Federal bureaucrats. The people of New York have been denied their choice of governor and he has been replaced by a man who was not elected to that office. That troubled him and it troubles me.

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