Waxman to Leave Committee Whose Powers He Abused

Congressman Henry Waxman (D-Calif.) has upset the House seniority system to chair the Energy and Commerce Committee, a move that will require him to step down as chairman of the investigative committee whose powers he abused while helping his trial lawyer friends harass Blackwater.

Longtime loyal Waxman staffer Philip Schiliro (pictured at right) is moving up Pennsylvania Avenue, where President-Elect Barack Obama has named him chief of White House congressional relations. Schiliro is leaving as the ultra-partisan staff director of the Committee on Government Reform and Oversight, from which he ran the anti-Blackwater hearings in partnership with trial lawyers as they sued the company.

Within two weeks of trial lawyer Daniel Callahan writing to Waxman requesting partisan attacks on Blackwater, Schiliro told the Washington Post that he planned to focus the committee investigations on Iraq, contracting, and the response to Hurricane Katrina - coincidentally the exact issues that had generated controversy for Blackwater. The Post noted at the time that when run by the Republicans under the chairmanship of Rep. Tom Davis (R-Va.), the Committee had a "relatively bipartisan tone." Schiliro turned it into an ultra-partisan attack machine.

Report: War Profiteer Defeated in Federal Court

We're hearing out of the US Federal Court of the Fourth Circuit in Richmond that a federal judge has rejected the trial lawyers' suit against Blackwater for the terrorist ambush in Fallujah, and has told the parties to settle their differences out of court.

This is a huge blow for ambulance chasing trial lawyer Dan Callahan (pictured), who had shell companies set up in North Carolina in the names of four deceased Blackwater contractors whom Islamist insurgents ambushed, murdered and mutilated in 2004. Via the shell companies, which he represented as "estates," Callahan was hoping to pocket many millions of dollars by taking advantage of the terrorists' attack on the Blackwater men. He persuaded several grieving members of the deceased men's families to go along, blaming Blackwater instead of the terrorists for the deaths, and holding out the prospect of lots of money from a court decision.

The trial lawyer is going to have to settle for a lot less now - if anything at all - after spending millions of dollars in venture capital in hopes of profiting from the atrocities.

It's also a big blow to Congressman Henry Waxman (D-Cal.), who opened up his "investigation" of Blackwater at Callahan's request, had Callahan's anti-Blackwater clients testify before Congress as expert witnesses, and followed the trial lawyer's script in holding the hearings and leaking confidential documents to the media.

Of course, this blogger's opinion that Dan Callahan is a sleaze is, indeed, an opinion, and is therefore protected speech. I'll be sure to post links to legal documents and news reports as soon as they're online.

CBO Fingers Waxman As Source of False Information

Congressman Henry Waxman's office is the source of the false information about how much Blackwater security contractors in Iraq are paid. That's not simply this blogger's view - it's a statement in a new Congressional Budget Office (CBO) report on private contractors in Iraq. The Senate Budget Committee commissioned the report.

During October 2, 2007 hearings, the staff of House Oversight and Government Reform Committee Chairman Waxman prepared a memorandum to committee members, stating that Blackwater security personnel in Iraq were costing $455,000 per person per year, "over six times more than the cost of an equivalent US soldier." Blackwater CEO Erik Prince sharply disputed the figure, which several congressmen - including and especially Waxman - repeated during the hearing and in subsequent interviews with the media.

Waxman made the statements as part of a favor he did for a trial lawyer who stands to make millions by discrediting and suing Blackwater. The liberal website ProPublica.org says Waxman's strategy is to discredit the company to "make it ineligible for future federal contracts."

The New York Times, Washington Post and other news outlets uncritically repeated the misleading figures, adding to the falsehood by stating that the figure was what the individual contractors were being paid. This blog reported on the falsehood on the day of the hearing. nearly a year ago.

The CBO report, issued last month, points directly to the source of the falsehood. In footnote 22 of page 14 of the report, the CBO said that the critics' "figures appear to come from a memorandum to members of the House Committee on Oversight and Government Reform, Additional Information About Blackwater USA (October 1, 2007), http://oversight.house.gov/documents/20071001121609.pdf."

"Those figures, however, are not appropriate for comparing the cost-effectiveness of contracting the security function or performing it using military personnel," according to the CBO. The $455,000 a year figure comes from a daily billing rate of $1,222 a day. "The figure of $1,222 a day represents the contractor's billing rate, not the amount paid to the contractor's employees. The billing rate is greater than the employee's pay because it includes the contractor's indirect costs, overhead, and profit," the CBO said. This cannot be compared to what a U.S. soldier costs the taxpayer because of many other costs involved.

The CBO backs up Prince's contention at the 2007 hearing that the costs include equipping and supplying the security personnel, and paying for equipment damaged or destroyed by insurgents or the US military. That equipment includes several helicopters the company lost to hostile fire. It is not possible to insure helicopters in war zones; Blackwater pays for the losses out of its profit and overhead.

It is rare for the CBO - an independent, nonpartisan auxiliary of Congress - to point to congressmen or congressional staff as the sources of misleading information, so the observation in the report is particularly important.

Senator Webb Won't Back Waxman; Says Blackwater Should Still Compete for Contracts

Senator Jim Webb won't back Congressman Henry Waxman's call for the US government to cancel Blackwater's contracts.

Moonbat writer Jeremy Scahill buttonholed politicians at the Democrat National Convention this week for a left-wing website. While getting Waxman to make his unprecedented call to cut off Blackwater - and receiving some praise for his own work against the company - Scahill didn't get Senator Webb to say the same.

To the contrary: Despite all his criticism of the company, Webb says he thinks Blackwater should still compete for contracts. Here's the dialogue:

JEREMY SCAHILL: "Do you think that, though, that Senator Obama should cancel Blackwater’s contract with the State Department, because it will be there if he wins? What should he do on Blackwater specifically?"

SEN. JIM WEBB: "I’m not—I mean, I’m not in a position right now to say that Blackwater’s contract specifically should be cancelled. I think all of them should be aggressively reviewed and, you know, have standards put on them, and I think Blackwater, like other companies, ought to compete."

Waxman Joins Moonbat Writer and Calls for Obama to Cancel Blackwater Contracts

Congressman Henry Waxman, the California Democrat who has abused his committee chairmanship to help a trial lawyer make millions in a suit against Blackwater, is now calling on Barack Obama to have the US cancel its contracts with the company.

Waxman made the statement in league with moonbat writer Jeremy Scahill for a leftwing website.

In his commentary, Scahill appears upset that Senator Obama is not for an immediate pullout from Iraq. "Obama’s Iraq policy in reality is one of downsizing and rebranding the occupation, not entirely ending it," he says. That would be good news for Blackwater, which is needed to provide security as US troops pull out.

Waxman tells Scahill that he thinks Blackwater is doing a "very poor" job in Iraq, and promises to "investigate" the company even more. He also praises Scahill, saying, "And so, they’re going to be investigated much further by the Congress and people in the administration and good people like you on the outside."

Waxman says Blackwater has not "lived up" to its Worldwide Personal Protective Services (WPPS) contract in Iraq - an odd comment because the company has been universally praised for its stunning 100 percent success record in keeping Americans safe.

Even Senator Obama has said that he thinks Blackwater's "getting a bad rap." And Senator Jim Webb (D-Va.), another Blackwater critic, would not back Waxman when Scahill asked him to.

So Waxman is putting himself out on the extreme fringe with his comments - and his praise of one of Blackwater's goofier critics.

Congressmen Accuse Waxman of Blocking Probe of Corrupt Colleagues

Congressman Henry Waxman (pictured), who has raised eyebrows by doing favors for a trial lawyer with a business interest in trashing Blackwater, now stands accused by two other lawmakers of blocking a probe into congressional corruption.

Reps. Darrell Issa (R-CA) and Mark Souder (R-IN) have filed a complaint with the House Ethics Committee over a published report that a mortgage company "gave illegal mortgages prohibited by House rules to members of Congress, congressional staff and other officials," Fox Business reports.

The lawmakers say that Waxman, chairman of the House Committee on Oversight and Government Reform, "is ignoring their demands for an investigation into cheap, VIP mortgages allegedly given by Countrywide Financial to House staff members and elected officials."

Issa and Sounder went to the House Ethics Committee after Waxman twice declined to pursue the issue, saying that it isn't the duty of his panel to investigate cases involving alleged corruption of his colleagues and their aides.

SBA Memo Does Not Accuse Blackwater

You wouldn't know it by Congressman Henry Waxman's spin when he released a memo to the press, but the Small Business Administration Inspector General did not accuse Blackwater of improper behavior.

A reporter for the Virginian-Pilot (a paper that has long been critical of the company) actually read the memorandum and reports, "The memo, written by Glenn Harris, counsel to SBA inspector general Eric Thorsen, refers to 'potential misrepresentations by Blackwater' but does not accuse the Moyock, N.C.-based firm of breaking federal laws or improperly obtaining contracts."

Waxman postured in a written statement that Blackwater “misled contracting officials who in turn ignored blatant warning signs. It is deplorable that no one ever looked out for the interests of the federal taxpayer.” He said it as fact, when that's not what the Inspector General said at all.

Waxman Strategy: Make Blackwater Ineligible for Federal Contracts

As he continues to hammer away at the linchpin that keeps US diplomatic activity secure and the troops resupplied in wars on the other side of the world, Congressman Henry Waxman is revealing his strategy.

If he can't discredit the job Blackwater is doing - with its 100 percent success record defending diplomats, aid workers, and visiting congressmen and senators from terrorist attack - Waxman thinks he can destroy the company by picking away at regulatory issues.

ProPublica.org describes what's happening: "Waxman appears to be taking a new tack: scrutinizing the contractor's employment practices to make it ineligible for future federal contracts."

"So far," says ProPublica.org, whose reporting is biased against the company, "Waxman's strategy seems to be working."

Waxman began his jihad against Blackwater in February 2007, at the behest of a California trial lawyer. The trial lawyer, Dan Callahan, is suing the company on behalf of shell companies that another trial lawyer set up in the names of four security guards whom terrorists murdered in 2004.

Sounds like a sleazy arrangement: A congressman using taxpayer dollars to discredit a defendant in a lawsuit on behalf of a private businessman, a trial lawyer, who stands to make millions by suing a private company that the congressman is pressuring the government to investigate. Too bad there's no accountability to stop such abuse.

Inspector General Faults SBA in 4 of 5 Findings, But Waxman Spins It to Blame Blackwater

The Inspector General of the Small Business Administration (SBA) has faulted the SBA in four out of five findings concerning Blackwater Worldwide.

Congressman Henry Waxman (D-Cal.) is alleging "waste, fraud and abuse" on his committee website, which contains a headline today worded to imply that the SBA has a major problem with Blackwater.

Blackwater is certain to take the blame in the headlines soon to be generated from the Waxman statement. Waxman generated the complaint to the SBA in March.

However, a look at the SBA Inspector General memorandum shows that of the five "findings," the government agency itself appears to be at fault in four of them.

In Finding 1, Blackwater and an affiliated company "may have" won contracts that were set-asides for small businesses, even though the company no longer qualified as a small business. It's pretty subjective and inconclusive, because of Blackwater's use of contractors versus employees in key areas to support the troops.

In Findings 2-5, the Inspector General blames the SBA itself - not Blackwater. Take a look at the original document and see for yourself: http://oversight.house.gov/documents/20080728141224.pdf.

Waxman spins the issue in a memorandum dated today, July 28, and titled: "SBA IG Finds Blackwater May Have Misrepresented Small Business Status." That's the gist of his complaint - he doesn't make an issue of the IG's four allegations against the SBA itself.

At the core of this argument is whether Blackwater can call its contractors "contractors," or whether it must designate them as "employees." The SBA IG report is littered with weasel words like "could have" and "potential," not daring to issue any definitive finding at all.

Waxman, as part of his work helping trial lawyers who stand to make millions from suing Blackwater, complained to the SBA, saying that the company shouldn't be allowed to call its contractors "contractors," but instead should call them "employees" so they can be taxed. Big Labor doesn't like how the law allows contractors either, because they can't be unionized and forced to pay dues to the union political machine.

The trial lawyers and labor unions are among the biggest campaign contributors to the very partisan Waxman's political party.

(Follow-on added at 5:08 PM: This blog broke the story of the SBA IG report. The first news report appearing on Google News was a McClatchy story written by Joseph Neff of the Raleigh News & Observer - the folks who gave the world the phony "news" about the Duke lacrosse team - posted at 4:27 PM. Standish posted the story first at 3:36 PM eastern time.)

'Witch Hunter in Chief'

How good is Congressman Henry Waxman's investigative staff on the House Committee on Oversight? Pretty good, most agree. But pretty careless as well. The Wall Street Journal recently blew the whistle on a Waxman witness whose reliability is a big question, considering his convictions on forgery, burglary and welfare fraud.

Lt. Col. Oliver North, the highly decorated retired Marine who is now with Fox News, penned a scathing broadside against Congressman Henry Waxman, the California Democrat leading the fight to bring down the private security company that saves the lives of our diplomats every day in Iraq. North's column appeared in the September 28 edition of RealClearPolitics.com.

Commenting on Waxman's upcoming October 2 hearing to pillory Blackwater CEO Erik Prince, North (pictured) notes the congressman's sloppy and sensationalistic style of "investigating." In a July hearing on abuses in the construction of the new US Embassy in Baghdad, Waxman invited a supposed witness, Rory Mayberry, to testify that American contractors were using kidnapped Filipino workers as slaves.

According to North: "At the time, Mayberry was described as a whistle-blower who had courageously come forward to describe how unwilling Filipinos were dragooned into building our diplomatic mission. All the major news networks covered his shocking 'revelations.' But this week, The Wall Street Journal's 'Washington Wire' revealed that the committee's star witness 'has a string of convictions going back to the mid-1980s, including two for forgery, one for burglary and a fourth for welfare fraud.' So much for good staff work."

Let's see what Waxman comes up with this week.

Is Waxman abusing power to aid trial lawyers?

Not even Jack Abramoff could top this one - getting a senior congressman to abuse his committee chairmanship by holding hearings to benefit a trial lawyer.

But that's what a California trial lawyer apparently got Rep. Henry Waxman to do in his jihad against Blackwater USA.

Waxman is holding another show trial of Blackwater on October 2.

The sleazy-looking arrangement came to light earlier this year when Waxman (D-Calif.) held an "investigative" hearing on Blackwater, and called in witnesses who happened to be plaintiffs in a case against the company.

Waxman chairs the House Committee on Government Reform and Oversight, a post that grants him sweeping investigative powers.

The Overlawyered blog reported last February, "Nice tactic, if you can get away with it: after filing suit, get a House committee to conduct a hostile investigation of your opponent with your clients appearing as friendly witnesses. That's what appears to have happened in the House Oversight and Government Reform Committee's hearings last week on alleged shortcomings in the work of Iraq contractor Blackwater USA. The friendly witnesses in this case, called by committee chairman Rep. Henry Waxman (D-Calif.), were family members of several Blackwater consultants killed in Iraq, who are suing the company for damages. According to Rep. Darrell Issa (R-Calif.), the hearing followed upon the sending of a letter to House Speaker Nancy Pelosi by Orange County, Calif., plaintiffs’ lawyer Daniel Callahan of Callahan & Blaine, who's representing the families. The letter urged a "fruitful and meaningful" investigation of "these extremely Republican companies, such as Blackwater, who have been uncooperative to date."

Waxman calls Blackwater chief to testify

Rep. Henry Waxman, the ultra-partisan opponent of the war in Iraq, has called on Blackwater CEO Erik Prince to testify before his committee.

Waxman (pictured) has been on Blackwater's case for a while now, but his "investigations" have produced little if any new information about the company. (We put "investigations" in quotes because he and his staff have stretched themselves so thin on so many fronts, they could not possibly be conducting much more than headline-grabbing political theater operations.) News reports did not specify the date of the hearing.