THE DALY SHOW

Rethinking Watergate, Deep Throat, and You

This is a posting explaining why you have to be engaged when watching TV and reading a newspaper – even when reading this column.  News is not a spectator sport.

LAS VEGAS, NV (December 26, 2008) – Stratfor this past week offered a revisionist – and well-thought out – history of Watergate and the effects on journalism.

Keep this in mind, when you are watching and reading news.

The examination was done in conjunction with the death of Mark Felt – aka Deep Throat. Stratfor didn’t revise any wrongdoings by President Nixon and his White House. But they questioned how the story was presented to the public and how that might have affected journalism decades later and today.

In short, the unveiling of Watergate was directed by an intelligence and law enforcement agency – the FBI. And the sole source, known by the journalists and the Washington Post, had an axe to grind; Felt was not chosen as the head of the FBI by Nixon. Felt then engaged in J. Edgar Hoover-like moves by spilling insider information on the executive branch of government.

By keeping Felt’s secret for so long, the public was denied full access to the motivations and biases of what could have been considered a rogue shadow government behind the leaking of the story.

Stratfor concludes there has been no real examination by news organizations of undisclosed sources over the years. As a result, Stratfor concludes:

What appears to be enterprising journalism is in fact a symbiotic relationship between journalists and government factions. It may be the best path journalists have for acquiring secrets, but it creates a very partial record of events — especially since the origin of a leak frequently is much more important to the public than the leak itself. Stratfor December 24, 2008.

Watergate and the success of Woodward and Bernstein launched many journalism careers: yours truly included. For three years in newspapers and four years in TV as an investigative reporter, I used my share of confidential sources to get stories. Corroborating those sources with other sources that went on the record was my main objective. Trust me, if I was going to be attacked physically, verbally, and legally, then I wanted to know I had the story stone cold.

No doubt it was exciting and rewarding work. I truly think I helped correct some wrongs. But it was also a heavy responsibility. You could be destroying people’s careers or futures. Knowing the motivation of the people in the shadows is paramount. But anyone who watched my reports would have to trust me. In today’s checkbook journalism world credibility is hard to sell.

The easy journalistic frauds to figure out are folks like Sean Hannity, Rush Limbaugh, and Neil Bortz all of whom continued to dredge up half-truth stories about Obama only days before the election while failing to offer other, most times more qualified, sources. We all know that the entertainers at night on Fox News Channel, talk radio, and MSNBC deliver stories with an angle – their angle. If you quote them as a source, then don’t be surprised if someone questions your fairness or accuracy.

That being said, it’s the major news organizations – like the Wall Street Journal (now owned by Fox), The New York Times, and the Washington Post – that you need to really question. Do these companies exist to deceive us? No. They’re reputable organizations. But they’re working in a non-scientific field; things change and they get stories wrong either innocently or through lazy reporting and editing.

These organizations should be scrutinized as much as they allegedly scrutinize our elected officials and business leaders. We should examine the news organizations and their sources motivations – and not just because they’re “liberal” or “conservative” which is the fall-back attack of extremists against news they don’t like.

Take the Blagojevich story. Has anyone really shown what crime he’s committed? Not yet. Does that mean he’s guilty? We don’t know. Should we question the motives of Prosecutor Patrick Fitzgerald? You bet. But we need time to see this through – for the sake of justice.

Remember: news reporting is just a one day snap shot in time. There’s the story about Einstein’s student telling him that Einstein had mistakenly given the same questions on a final exam from the year before. Einstein said he knew it. Even though the questions were the same, he explained to the student, the answers this year are different.

In addition, let me add that all news organizations are facing tough financial times. News staffs are being cut back here and around the world. Meanwhile, more journalists are being killed or arrested around the world. Though not as ominous, our new Administration is depending more on social networking sites to reach you. They could also be controlling the message, too.

What does this mean? It means you are the most important journalist in your life. You need to work when you watch and read the news. Let me help you.

If you want a copy of my book – for free – write to me at info@johndaly.tv and put “free book” in the subject line and I will email you a copy of the book.

Merry Christmas

Snow And Nike Dog in Las Vegas

 This is a shot of Nike and my wife Teri who appears to be, as our friend Judith Hantin wrote, in the witness protection program.  This was taken on a snowy day in Las Vegas.

I’m Guest Hosting On Talk Radio

This is a posting that you will see a few times.  I want to remind folks that I will be on KDWN Radio 720 AM in Las Vegas and also at www.kdwn.com.  The dates are December 22, 23, 29, and 30 at 8 am to 10 am Pacific time.  I will be filling in for Heidi Harris on The Heidi Harris Show.  Many of you have seen Heidi as a guest analyst on Fox News Channel.  Although we don’t agree on everything, Heidi has become a good friend.  I can’t thank her enough for allowing me to fill in and chat with her many and loyal listerners.  I hope you will join us.

New Media Trend: The Financial Perp Walk

This is a posting to warn you that the financial tsunami is not here yet. I base my findings on the Madoff scandal, some conversations with developers on the Las Vegas Strip, and a recent 60 Minutes story that has the banking community buzzing. In other words, brace your sweet butts. You want uplifting? Sorry, not here not today. But you won’t get this from too many other journalists or analysts.

LAS VEGAS, NV (December 16, 2008) – In the TV biz, we talk about getting video of the “perp walk.” Perp is short for perpetrator; the criminal, the bad guy. The actual walk is the ceremony where the perp is paraded out in handcuffs by police to either go to court or lock-up.

It’s like the perp’s first sentence – even before he’s convicted. The injustice of the perp walk is that a perp could be found not guilty but the searing image of the perp parade stays in the public’s mind.

The perp walk has purpose for the media and police. For the media, it gives us the video we need to tell the story easier. For the cops, the shame of such a stroll could sometimes get a suspect to cooperate. Many times, the cops really don’t have to walk them in front of the cameras.

My prediction: expect more perp walks for the crooks in the financial industry. There will be more perps to walk. And an angry public always loves a parade.

The Bernie Madoff story is only the beginning. The fund manager lost $50 billion in what he even called a ponzi scheme. In short, Madoff took money from new investors and paid off old ones. The lousy economy finally revealed his chicanery.

Madoff was the former head of NASDAQ who either outwitted or was in bed with SEC regulators. His story will reverberate throughout the financial industry and the regulation aftermath for decades to come.

Here’s another injustice. Madoff didn’t perform a perp walk. He had enough money to be released on bail. However, he’ll get his ten minutes of perp walk fame soon.  (Editor’s note: After this was posted, Bernie had his version of a perp walk in front of cameras.  There was some pushing and shoving and some tight security since there appears to be death threats against Bernie.)

What struck me about the coverage of Madoff: the descriptions of Madoff by friends and colleagues. He was such a nice guy, they said. We would have never thought he could do this. Those are similar sound bites you hear on a newscast about the guy who has just killed his wife and kids.

In some respects, Madoff did the same. He killed many retirements of elderly folks. He killed careers of his family and colleagues, many of whom will be going to prison for putting investors into Madoff’s funds. Some of these advisors put all of their investors’ money into Madoff’s funds despite clients demand for diversification.

So what does the Madoff case mean to you?

Let me mix two metaphors. Madoff is the canary in the coal mine that is really a tunnel and before we see that light at the end of the tunnel we need to walk through a lot of toxic air. And still that light at the tunnel’s end may be a locomotive heading our way.

How’s that for a confusing metaphor? Trust me, that’s a simple description compared to what’s been done to the financial industry. In short, folks, the worst is not here yet.

In fact, Madoff is a low-level criminal in all this. He’s the equivalent of the burglars who broke into the Watergate. The Nixons, Liddys, Haldermans, and Erlichmans right now are untouchable and sitting on Wall Street.

I wrote about this in September in a column called “All Running For Cover.” This was my take on why the original bailout bill failed to pass Congress the first time. I quoted the then-director of the Congressional Budget Office, Peter Orszag, who raised an issue that seemed to be ignored. He said.

“Ironically, the intervention could even trigger additional failures of large institutions, because some institutions may be carrying troubled assets on their books at inflated values,” Orszag said in his testimony. “Establishing clearer prices might reveal those institutions to be insolvent.” From the Washington Post 09/25-08

In other words, Orszag was saying these financial institutions are not telling us the truth about what is really on their books. The good news is that Orszag has been tapped as Obama’s Budget Director since then, so we should get more honesty out of this Administration.

I think Orszag’s comments proved correct over the past few months. Look at what happened once the TARP passed. Treasury was going to buy up all those toxic assets – those mortgage backed securities and the phony insurance instruments called credit default swaps. But then Treasury switched course. Instead, they would just invest in these financial institutions. Why?

My guess is this: those toxic assets had lost so much value that many of those institutions would fail immediately and the entire banking system might have collapsed. My other belief is there was so much criminal activity in these financial institutions that we’d be walking so many of these crooks in front of cameras there would be no one to run the financial system.

Am I accusing the financial industry of criminal activity? Not yet. I don’t have the proof or the financial expertise. No one does. But it certainly smacks of a cover-up on the part of the current Treasury Department to take care of the guys on Wall Street in the name of saving our banking and financial system while many of us lose our homes.

Look what’s happened since the bailout money has been issued. Citigroup nearly failed despite all the money from TARP. None of those institutions are lending that money. Why? My belief: the infusion pales compared to the enormous losses on the books of the past five years.

Just yesterday the Fed announced it is buying up long-term credit and those toxic mortgage-backed securities – the same thing the TARP was supposed to do. Notice the media dwelled on the historic cut in interest rates. They missed the important part of the story. Those cuts mean nothing unless banks loan money – and right now they won’t.

Frankly, who can blame them? Why would you lend anyone or any business any money in this environment? Underpinning the economy is the consumer who is tapped out: no credit cards, no equity in the house, and possibly no job.

We have a friend who is a local banker. She told my wife yesterday if someone wants a loan for more than $200,000 it will be an act of God. Low six-figure loans are not going to jump-start our economy.

Sunday’s 60 Minutes piece on the economy has spooked many local bankers. Go back and watch it. (Make sure you’re sitting down and if you drink have a double.) Experts told 60 Minutes the same thing I’m saying. The wave of mortgage failures so far is nothing compared to what 2009 portends.

I have a unique perspective living here in Las Vegas. We lead the nation in home foreclosures. One reason is we had so many speculators coming in and buying investment homes at the height of the bubble. The second reason is this is the land of opportunity where everybody from all over the country either wants to visit, work, invest, or live.

As a result, the nation’s economy comes to us. Las Vegas will be the first to recover since we were the first to go into recession and once the economy improves more folks will come here to spend their money on fun times: it will be cheaper and easier than travelling overseas. That good news, however, is possibly years away.

Why do I say years away? I hear one thing from many of the brilliant minds behind Las Vegas that I have near heard before: confusion. They don’t know what to expect. They can’t see the future. It’s way too cloudy. As a result, many projects will remain idle for 2009. Others will fail. This is something we never imagined here.

Let me throw in a caveat here. Steve Wynn is about to open Encore, his new resort next to his Wynn Resort on the Strip. They cater to the ultra-wealthy who are apparently immune to this downturn — unless they call Bernie Madoff an advisor.

Still, when I see so many other business leaders who cater to the middle class customer shake their heads with fear and doubt, it frightens me.

So, let me warn you again. Protect yourselves financially. Hold out as much cash as you can. If you’re going to default on your home, talk to your mortgage holder or bank about another arrangement or a short-sale.

And protect yourself physically. People who are not normally criminals may be desperate in these times. With the homeowners left on your block form a solid Neighborhood Watch Program. Remember the elderly who will be the most victimized.

But remember, above all, the words of Mother Teresa, be kind. Be kind, even when you watch the perps walk.

Blago And Me! Geez

The latest embarrassment for me has been the number of emails and phone calls from people who think I resemble the embattled and ethically-challenged Illinois Governor.

LAS VEGAS, NV (December 14, 2008) — The phone calls and emails were enough to make me think: do I really resemble Governor Blagojevich?

My writing partner Eric Snyder calls to tell me if I had that bad haircut, I’d look just like him.  Long-time TV Producer George Ciccarone says Blago is my twin.  Even my wife tells me that friends think I resemble him.

Come on, folks.  Take a look at that photo on the website.  Does that look like Blago?  Yes, that photo … with make-up and great lighting … err .. that’s been airbrushed. 

So, here’s my dilemma.  I’m either mistaken for a drunken, fat slob of a golfer or a graft-grabbing politico.

My solution.  I’m going to dye my hair blonde, spike it into a mohawk, and change my name to Hussein Palin.

Suggestions?

Shakedowns On The Rise

This is a posting about the crimes on Wall Street and Main Street.  They show the lack of values we have that ironically the out-going Republican Party ran on so boldly and failed to back up.

LAS VEGAS, NV (December 14, 2008) – So, I’m walking out of the local Wal-Mart and I notice two men tugging at a loaded grocery cart. It was like a dance; each one trying to pull it away from the other.

What was happening? Apparently one of them bought the groceries. The other man was trying to steal the groceries by saying he had bought them. It’s an interesting and easy scam if you can get someone’s receipt.

Store security arrived quickly to apparently resolve the situation. I didn’t stay to see the outcome.

But I thought about the altercation a lot.

First, if this happens to you, hold onto your receipt. This could happen more often since most people are using cash and not credit cards. And this will happen to folks who are elderly, physically weak, and who don’t speak English well. In other words, be prepared for shakedowns like these.

The economic downturn has revealed similar shakedowns on Wall Street.

Look at the Bernie Madoff story. Here’s a titan of Wall Street who once oversaw the NASDAQ who was running a ponzie scheme. And then there is the story this week of the trusted lawyer who tried to pass off phony investments. Both these men cost investors millions.

Here’s where the two Wall Street shakedowns are similar to the one I witnessed at Wal-Mart. There were no cops around. The Bush Administration (and some blame can go to the waning days of the Clinton Administration) literally removed the watchdogs of business. No one was asking questions about the sophisticated investment vehicles that, in some cases were camouflaged as insurance policies, and their effects.

And now, as a result of the lax oversight, we may see fewer cops on the streets. A good friend who works in the local police force told me about the budget shortfalls and what it means for police protection. Another friend says when you call police now it better be life threatening or else you have to go down to the police station and make a report yourself. No wonder gun sales are up.

Another friend, businessman Bill Bailey, talked about the number of unscrupulous business people who renege on contracts and then force you to spend money by suing them. “That’s what helped get us in this mess,” he told me the other day.

He’s right.

Bush To Cheney: “Hey, Moe”

This is a posting about a leaked report on the reconstruction of Iraq. The report is evidence that President Bush will go down as one of the worst presidents in our history and we Americans can truly be a dumb lot that allowed our nation to become weaker.

LAS VEGAS, NV (December 14, 2008) – A Republican friend told me at lunch a short while ago that he felt sorry for President Bush because so many bad things happened to him while he was in the White House. “Clinton had it much easier,” he said.

I didn’t know where to start without making my friend seem like an idiot. It was one of those conversations I knew would not end in any agreement since he had his facts that were not my facts. So, I kept quiet.

However, a study that will be published in February will give me plenty of fodder for anyone else who thinks our out-going president was a victim of circumstances.

Clearly, this president was doing the work of three men: Moe, Larry, and Curly. (Maybe the President was Larry while Cheney was Moe and Rumsfeld was Curly.)

Either way, the difference between the original Stooges and the ones in this Administration: things didn’t turn out so good for America’s stooges. And it’s not funny.

The report is entitled, “Hard Lessons: The Iraq Reconstruction Experience.” It was compiled by the Office of Special Inspector General for Iraq Reconstruction. The initial draft was leaked the New York Times. But before you go all right-wing whacko on this, know this: the leader of this office and the author of the report is Stuart Bowen, Jr., a Republican lawyer.

The report concludes that we were not prepared for the reconstruction effort and the Iraqis are far worse because of our failed efforts. That’s after $117 billion were spent – including $50 billion of direct taxpayer money.

What’s worse is the money was spent for political reasons – to get George W. Bush re-elected to a second term.

When the Office of Management and Budget balked at the American occupation authority’s abrupt request for about $20 billion in new reconstruction money in August 2003, a veteran Republican lobbyist working for the authority made a bluntly partisan appeal to Joshua B. Bolten, then the O.M.B. director and now the White House chief of staff. “To delay getting our funds would be a political disaster for the President,” wrote the lobbyist, Tom C. Korologos. “His election will hang for a large part on show of progress in Iraq and without the funding this year, progress will grind to a halt.” With administration backing, Congress allocated the money later that year.

This is Nixon-type stuff. I guess Iraq will smack of Vietnam.

There are plenty of implications if this report gains traction. (So far, the Wall Street Journal and the Washington Post have not picked up the story. If anyone catches it elsewhere, let me know.)

First, it raises questions about our future efforts in Afghanistan. President-elect Obama wants to send more troops into that region to hunt down bin Laden and wipe out the Taliban. You have to wonder if the surge in Iraq can be replicated in the nomadic terrain of Afghanistan.

Second, the report makes us realize how impotent we are militarily and diplomatically overseas. We have the bombs, but not much else. Certainly the success of the surge in Iraq has taught us how to tame and work with a population to control an insurgency. But do we really have the resources to be doing this often? I don’t think so.

Granted, I contend that one of the reasons we went into Iraq was to gather intelligence on the world’s Islamic terrorists – that threatened another 9/11. Tactically, it made sense. We provoked all the world’s jihadists to come to Iraq so we could figure out who they were. And, it seems, we did a good job of killing of a number of their heads. But politically and diplomatically, it was a failure. We actually created more terrorists: young men with no education and no work who are angry at us. And morally, it was reprehensible. We provoked a war in a country to help with our intelligence aims. And I won’t even mention the oil.

The third implication is the transparency of government contractors. Although Blackwater is not cited in the Times story, it is clear the amount of money wasted and funneled to companies like that will be more scrutinized.

Fourth, the report will help the Republican Party regain its core beliefs. The GOP is – and should be — the party of business. It’s not just the party of big business. It’s the party of all businesses. And the main businesses that run this country are small businesses. And when you realize what this Administration has done to those business principles and the demise of the Republican Party, you can bet the business Republicans will be back in power soon – without the religious zealots and the near-fascist neo-cons.

And fifth: hopefully the report will show Democrats how power can corrupt and weaken our nation.

A New Look at US Auto Bailout

This is a posting about a new intitiatve on the American car industry.  It comes from Al Dimora, owner of Dimora Motorcar.

LAS VEGAS, NV (December 6, 2008) — I met Al Dimora through my good friend Paul Glessner last month.  His vision is something we should all take a look at.  Granted, Al has a profit motive for his company.  But Al contradicts the contention that the bankruptcies of the Big Three will be destructive to our economy.  He also shows how using the thinking of Silicon Valley will bring a new century of car companies.

Click here to read:The Dimora Auto Industry Initiative

Then offer your comments below.

The Changing Media And Golf

This is a posting I wrote for my golf column on LasVegasGolf.com and WorldGolf.com.  Click and read here.