Excellent, graphic-rich summary of Gorelick's leaden touch:
http://directorblue.blogspot.com/2008/09/jamie-gorelick-mistress-of-disaster.html
--S.
It's not often that one person plays key roles in two -- count 'em, two -- trillion-dollar disasters. Welcome, my friends, to the world of well-connected Democrat Jamie Gorelick.
In 2004, observers were "astonished" to discover that a key member of the 9/11 Commission had a fatal conflict-of-interest. Jamie Gorelick had served as a Deputy Attorney General under Bill Clinton from 1994 to 1997.
It was later revealed that Gorelick had established a pre-Patriot Act "wall" that prevented the foreign intelligence and criminal investigative communities from collaborating.
Her 1995 memo, entitled "Instructions on Separation of Certain Foreign Counterintelligence and Criminal Investigations", stated explicitly that they would "go beyond what is legally required, [to] prevent any risk of creating an unwarranted appearance that FISA is being used to avoid procedural safeguards which would apply in a criminal investigation."
The result: shortly before 9/11, Gorelick's wall "specifically impeded the investigation into Zacarias Moussaoui", the so-called "20th hijacker."
At the time, an enraged FBI investigator wrote a memo to headquarters which included the sentence, 'Whatever has happened to this -- someday someone will die -- and wall or not -- the public will not understand why we were not more effective..."
The 2004 disclosure that Gorelick's service as a 9/11 Commissioner was the archetypical conflict-of-interest should have triggered a cacophony of complaints and demands for a new investigation. Instead, the mainstream media turned deaf and dumb and the controversy faded into the background.
Gorelick's "wall" wrapped a blindfold around America just when it needed its vision to stop the attacks that killed thousands and which sucked a half a trillion dollars out of the economy.
Where did Gorelick turn up next?
Though she had no training or experience in finance, Gorelick was appointed the Vice Chairman of Fannie Mae and served in the role from 1997 to 2003. During that six-year period, she earned over $26 million.
During Gorelick's tenure, FNMA suffered a $10 billion accounting scandal, an ominous harbinger of the firm's looming troubles. One of the falsified transactions helped FNMA hit earnings targets for 1998, which triggered bonuses for top executives including nearly $800,000 to Gorelick.
Put simply "Jamie Gorelick was one of the Fannie executives who benefited from inflated bonuses based on Enron-style accounting."
In 2002 Business Week interviewed Gorelick concerning the health of FNMA. She responded, "We believe we are managed safely. We are very pleased that Moody's gave us an A-minus in the area of bank financial strength -- without a reference to the government in any way. Fannie Mae is among the handful of top-quality institutions."
Less than a year later regulators "accused Fannie Mae of improper accounting to the tune of $9 billion in unrecorded losses."
Today, of course, FNMA is on taxpayer-funded life support, currently trading at 61 cents a share. And because it was thought to have been "managed safely" (Gorelick's words), many top-flight financial services companies held its stock.
Last week it was revealed that top insurer AIG was teetering on the precipice of disaster because, in part, it held $600 million in Fannie and Freddie. Roughly $4 billion in those stocks are held by insurers, according to rating agency A.M. Best.
Put simply, FNMA's collapse helped touch off the current swath of instability in the financial system.
It's not often that one person plays such a key role in two unmitigated disasters.
Democrat Jamie Gorelick is just such a person; that is why she has earned her nom de guerre "The Mistress of Disaster".
What do you call someone with a Midas Touch, only instead of gold everything they touch turns to s***? That's what Gorelick's got.
If I was one of her associates at the law firm of WilmerHale, I'd keep my head on a frickin' swivel.
Update: Just Barking Mad adds even more foaming-at-the-mouth-level anger to the story:
In 1999 Fannie Mae announced that it would purchase $10B in CRA loans. In 2001 they reached that target as Ms. Gorelick announced that they would roll these into special security issues...
Yep, you guessed it. Gorelick also had a direct hand in the mortgage securitization debacle. I'm guessing we could link her to a few other catastrophes if we did the legwork. Where was she when the Hindenberg below up, for instance?
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