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“Bidness” as Usual Express: The Eric Serna–John McCain Connection

From Santa Fe to Austin to Washington – it’s (as Molly Ivins would say) just the way they do “bidness” around here.

Let’s start with Eric Serna. Remember him? Once upon a time he was the young up-and-coming politico who, when he ran for Corporation Commission in 1982, populated the highways with all those god awful billboards that made him look like Eddie Munster?

Most recently Serna was in the news when he resigned his post as N.M. Superintendent of Insurance after coming under investigation by the state’s Attorney General. One of the many questionable acts that was being given scrutiny was Serna’s 2004 grant of a controversial waiver allowing a Dallas businessman by the name of David Judd Disiere (who had been convicted of insurance fraud in Louisiana) to do business in New Mexico.

A few months later an oil production firm owned by the Dissiere’s wife (Southern Management Services Inc.) serendipitously donated $20,000 to the nonprofit foundation which Serna been using his position to promote.

Just doing bidness.

When the shady deal all came to light, who should rush into the breach to assure state regulators that everything was on the up-and-up, but Disiere’s attorney – gold-plated lobbyist and former Texas Congressman, Kent Hance.

Today Hance is right there on the list of 126 corporate lobbyist bagmen who are bundling campaign cash for Republican presidential candidate John McCain.

Birds of a feather

Hance started out as a conservative Democrat in Texas. He holds the distinction of being the only person to beat George W. Bush in an election – a 1972 race for Congress. Hance taught young W a lesson he never forgot.

Hance portrayed Bush as “not a real Texan” because of his privileged upbringing and Yale education. Hance later said in an interview that after that election, Bush vowed that “he wasn’t going to be out-Christianed or out-good-old-boyed again,” and developed the folksy image that eventually carried him to the White House. (from Wikipedia)

Hance famously switched to the Republican party in early ’80s – following the lead of his mentor and fellow Texan congressman, Phil Gramm.

Which brings us to Gramm. He went on to be elected to the U.S. Senate from Texas (he defeated Ron Paul in the 1984 primary) and served from 1985 to 2002.

Currently Gramm serves as the McCain campaign’s co-chair and chief economics advisor – the latter post being one that should be taken quite seriously given McCain’s admission that economics knowledge is not his strong suit.

Speculation focuses on Gramm getting the Treasury Secretary slot in a McCain Administration. What kind of policies could we expect from a Gramm inspired McCainomics?

For starters, much of the blame for the current subprime mortgage crisis can be laid at the doorstep of Gramm.

Take the major piece of “deregulatory” legislation he sponsored in 1999 – the Gramm-Leach-Bliley Act, also known as with more than a touch of irony as the “Financial Services Modernization Act”. An incredible $300 million in lobbying money propelled the Gramm bill through Congress and a Bill Clinton signature. As one commentator has noted: “It encountered little opposition other than from those old-fashioned banks that actually insure your deposits.”

Gramm tried running for President in 1996, but got beat by Pat Buchanan in the Louisiana Primary. After retiring from the Senate in 2003, Gramm became vice chairman of new investment banking operation of Swiss bank UBS, where he immediately started lobbying on mortgage issues.

For his work, Gramm and two other lobbyists collected $750,000 in fees from UBS’s American subsidiary. In the past year, UBS has written down more than $18 billion in exposure to subprime loans and other risky securities and is considering cutting as many as 8,000 jobs.


Here’s more on “Foreclosure Phil.”

Six Degrees of Separation

So that’s the way it is. Just to recap: We go from Eric Serna to the convicted felon, the felon’s wife, Kent Hance, Phil Gramm and John McCain.

It’s just a cozy case of six degrees of separation that so well defines the governmental-industry-lobbyist-campaign cash complex that dictates policy in our state capitols and in Washington D.C.

Hey Molly. Are you catching all this? Ethics reform… anyone?

(See Olbermann’s take on Gramm’s connections with UBS and McCain.)


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