NewsBusters Interview: David Freddoso, Author of 'Gangster Government'

May 11th, 2011 10:16 AM

During the 2008 campaign, much of the press succeeded in painting a portrait of Barack Obama that bore almost no resemblance to either the Chicago politician he was before, or the president he's been since. We were sold Hope and Change, but ended up with what Washington Examiner columnist David Freddoso decries as "Gangster Government" in a new book bearing that title.

Gangster government is "about governing without recognizing the legitimate limits of one's power," as Freddoso describes it. "It's about officials who use public office to make winners into losers and losers into winners; who bend, break and make the law to help their friends and punish their enemies."

Freddoso contends that the term describes Obama's administration better than any before it. The man cut his teeth in Chicago, the mecca of gangster government, by Freddoso's telling, and exported that brand of public policy - with the aid of a pair of complacent watchdogs in the news media and Congress - into the Oval Office.

The problem is institutional, he argues, and hardly unique to Obama or the Democratic Party. "What makes you think you can trust [any Republican] with the absolute power the presidency has come to represent?" he asked me in an interview. But he stressed that, while the existence of gangster government is not a product or tool of any single person, ideology, or political party, no president has ever exploited the defects in the system to greater effect than Barack Obama. Just look at the numbers, Freddoso insisted:

Let's take George W. Bush and Halliburton, this unholy relationship. We're just going to assume the worst about it for our purposes here. And you're talking about $7 billion in no-bid contracts, which is a lot of money. On the other hand, we go to the Obama administration, and one of Obama's first executive orders basically sets it up so that companies with unions have an advantage when they bid for construction projects. It's called project labor agreements. And the stimulus package contained $140 billion worth of contracts that would be subject to that executive order. So we're not talking about $7 billion here, we're talking about $140 billion.

That disparity, and the sheer scale of cronyism that pervades Obama's administration, was hardly ever explored in any detail during his first two years in office. In fact, some in the media - notably the Fox News Channel and a number of talk radio hosts - that criticized gangster government found themselves among its victims as the Obama administration worked to marginalize its critics.

Freddoso raised red flags in 2008 with his book "The Case Against Barack Obama," which noted some of the trends that translated into White House policy under Obama. With "Gangster Government," he follows up with a powerful and exhaustive examination of efforts to, in the president's own words, reward his friends and punish his enemies.

The book's title draws from a column by Freddoso's Examiner colleague - and author of the book's forward - Michael Barone who wrote in 2009 of the Chrysler bailout: "We have just seen an episode of Gangster Government. It is likely to be part of a continuing series."

The prediction was spot-on, Freddoso argues. From the auto bailouts to the Stimulus package to the health care bill, "Gangster Government" paints the administration as perpetually beholden to its most powerful bases of political support - chiefly labor unions, but also trial lawyers and the Big Green corporate-environmental lobby. Major supporters of Obama and the Democratic Party have benefited from virtually every major initiative this White House has undertaken.

The approach has little to do with ideology. "I don't really believe, although some conservatives make the argument, that he comes from the basement of the Soviet Kremlin," Freddoso told me. "I think that he is really a political hack in the Chicago tradition, who looks out for himself and looks out for the people who get him elected and that's his primary focus, and that's been the primary focus of his administration so far."

Like the problem itself, the solutions, Freddoso argues, will have to be institutional and transcend party lines. Check out the audio of the interview or the transcript for some of his ideas on doing away with gangster government.


NEWSBUSTERS: Starting with the title - the term "gangster goverment," I don't want to call it hyperbole, obviously it's not, but it's a very inflammatory term, almost.

FREDDOSO: I prefer provocative. But I also think it's very descriptive. You go back to the first use of that term in reference to the obama administration by our own Michael Barone here, who was kind enough to write the forward to the book, that incident, which he called an episode of gangster government, saw the pinstriped thugs of Obama's Treasury Department going to the secured creditors of Chrysler, who were owed money by the company, who should have been first in line, in any real bankruptcy proceeding, to collect, and say to them, "we're taking your property away, we're giving it away to a politically favored labor union, and if you resist us, we're going to smear and vilify you using the White House as our platform." Which Obama did. On April, 30, 2009, he gave the now-famous speech in which he attacked these pension funds - the indiana state highway fund and the other folks, the few secured creditors who still stood in his way, and didn't go into the night quietly. In the mean time, he had already bought off all off all of the big banks and others who were involved in that, who had secured obligations with chrysler, because they were actually getting more money form tarp than they ever would've gotten from a Chrysler bankruptcy or money back on what they had leant Chrysler.

So what you had here was massive government overreach in a number of places at once. Not all of which, by the way, were Obama's fault. Not all of those overreaches. We had President Bush destroying capitalism in oder to save it, in roughly his own words. Obama, though, was given a blank check by what Bush did at the end of his term. The TARP bill was used as a justification for bailing out automakers, manipulating bankruptcies, taking majority ownership in GM, which is unprecedented, to my knowledge. Obama was basically given a blank check by Bush, and being the Chicago politician he is, has made full use of that power. He has ruthlessly exploited the brokenness of our system in a way that only a true Chicago politician could.

NB: So now that's actually a perfect segue into the next question, which is: the subtitle of the book suggests that this is, that it's somewhat of, if not a new phenomenon, that it's been taken to new heights under Barack Obama. So to what extent is this just business as usual in Washington?

FREDDOSO: It's a good question, because people bring it up and say, "well, doesn't everybody kind of do that?" Well, with Obama, the big quote and the one that I keep going back to is his own quote during the 2010 election cycle: "we're going to reward our friends, we're going to punish our enemies." To some degree, sure, everyone does that, but not to the degree that this administration does it.

I would say that one good way of understanding that is to look at the dollar amounts involved. Let's take George W. Bush and Halliburton, this unholy relationship. We're just going to assume the worst about it for our purposes here. And you're talking about $7 billion in no-bid contracts, which is a lot of money. On the other hand, we go to the Obama administration, and one of Obama's first executive orders basically sets it up so that companies with unions have an advantage when they bid for contraction projects. It's called project labor agreements. And the stimulus package contained $140 billion worth of contracts that would be subject to that executive order. So we're not talking about $7 billion here, we're talking about $140 billion.

And that's just the beginning. Then you add in the automotive bailout, which is an $80 billion proposition, which saved the UAW from complete extinction. I mean, they had 700,000 members in 2001. They had 350,000 by the time of the auto bailout. If not for the bailout, they would've been cut in half again. They have money, they just don't have any members. They have this billion-dollar strike fund, but if you don't represent any workers, than your union seems to have little rationale for existence. They also had more than 500 people on their payroll who were making six-figure salaries at their national headquarters just last year, according to last year's report. Actually, they have cut back their payroll since then. They filed this year's report last month.

But you just see one thing after another. Unions I think are the best example because they've done the most to help Obama. But the things that I just mentioned to you, so we're talking hundreds of billions of dollars in play here, add in the overturning of 75-year precedent of majority requirement for a union to organize the workers in a business, the Obama administration threw that right out the window to help them. I don't know what sort of dollar amount, price tag you can put on that, but I think it's a big deal. When you look at the fact that 34 percent of AirTran employees just forced the other 66 percent into the machinist union, that's a really shocking thing to have. And it couldn't happen under the law as correctly interpreted for the last 75 year s. Obama appointees came in and changed that so that a minority can now force the majority, through low turnout, into a union.

You add all of those sorts of favors together, and they keep going and I could write a whole book about it - which I did - but if you look in Gangster Government, I give several different examples where Obama is rolling back union transparency requirements, where he is doing just overt, flagrant favors for organized labor. I mean, the other 88 percent of us who don't belong to labor unions are kind of an afterthought to this administration's labor policy. It's kind of striking to see his middle class task force is nothing but a laundry list of union political priorities - card check, project labor agreements, stuff like that. How much do you, when you sit down at your kitchen table in the morning with your family, I would just ask the average American worker, are those the sorts of things that you think about that would help you out, or do you have different priorities? This administration's priority is clearly to help its friends.

I think that just that, the unions would certainly be enough, but you start looking at where the Stimulus money has gone to some of these green bandit corporations, you start looking at the way the administration has bent over backwards to help people who sue businesses for a living - the trial lawyers - and the way that he has avoided stepping on their toes, even though they are the biggest - one of the biggest problems when it comes to medical costs, something Obama keeps saying he wants to cut back on. The fact that they weren't included - that their gravy train wasn't affected at all by the Obamacare law, is another very telling episode.

So yeah, we're talking about favor wheeling and dealing, helping friends in a way that other administrations, I don't think you could find any examples quite like that in the Clinton administration or the Bush administration or in the previous Bush administration. Obama is kind of [unintelligible] generous when it comes to this.

NB: And yet it hasn't been - that narrative, it hasn't really been explored. There hasn't been much of an investigation into the - you talk a lot about Obama's Chicago upbringing, and he had a history of this sort wheeling and dealing. This was something that was virtually ignored during the campaign, was it not?

FREDDOSO: It really was, and I tried in 2008 in "The Case Against Barack Obama", I tried to explore that as much as possible and to kind of educate a non-Chicago audience in Chicago politics and how Obama got ahead by hooking himself up with some of the most unsavory characters in a very dirty political town. Politicians in Chicago have the common characteristic that they believe they're above the law, generally speaking. Sometimes that just comes out in raw power-grabs like Mayor Daley tearing up Meeks Field, an airport, without even telling the FAA, just 'cause "Hey, I want a park there, and I'm the mayor, I get my way, I show up at one in the morning with the bulldozers, and your airport is gone." And they ended up paying a fine for that, but it wasn't anything compared to what - the punishment was definitely not commensurate with the crime. It was a very inadequate punishment.

But you see all of these aldermen taking bribes and going to jail and engaging in other openly corrupt although sometimes legal practices. Obama's political godfather is a very interesting figure, whose entire family managed to end up on the government payroll or on the payroll of government contractors for whom he does legislative favors from his position as state senate president. We're talking about Emil Jones. He's been making himself loans from his campaign fund, which is legal in Illinois, amazingly. For years. Interest-free loans. He's also, now, if you go look in the campaign finance records, you'll find that he buys his season tickets to Bulls games using those funds. That's the kind of political world that Barack Obama cut his teeth in. The kind of political world where he won his first election by throwing all of his opponents off the ballot. And he was supposed to be some kind of reformist, savior, good-government person, but there's nothing in the record to indicate that at all.

NB: So then did you have to do much digging to find all of these things? I mean, why wasn't this reported? Was it just a genuine lack of concern?

FREDDOSO: I think it was a lack of concern. Some things I did have to dig for, especially when it came to specific legislation and stuff along throe lines. But a lot of it was well-covered by the Chicago press, which no one bothered to read. People I think preferred to think of Obama during that election and campaign as a kind of shining hero coming out of nowhere, coming from Mt. Olympus in order to govern us. But as I point out in Gangster Government, Obama doesn't come from Mt. Olympus.

I don't really believe, although some conservatives make the argument, that he comes from the basement of the Soviet Kremlin either. I think that he is really a political hack in the Chicago tradition, who looks out for himself and looks out for the people who get him elected and that's his primary focus, and that's been the primary focus of his administration so far.

NB: And you got a taste of gangster government personally for pointing these sorts of things out. Can you talk a little about that experience?

FREDDOSO: Back in '08, I was promoting "The Case Against Barack Obama," and I was going to Chicago to appear on Milt Rosenberg's show on WGN. Now I didn't get it quite as bad as my then-colleague Stanley Kurtz at National Review. But this is very interesting, because the Obama administration - this isn't necessarily, I don't view it so much as a threat against me and Stanley, as it was an attempt to intimidate the radio host out of having us on the air.

When Stanley went on, he went on after the Obama campaign - not some left-wing group or a bunch of activists, but the actual campaign for president of Barack Obama - sent out a defamatory email about him saying that he was a conspiracy theorist, crackpot, all kinds of really nasty stuff, to tens of thousands of people, these sort of Chicago political goons who show up every two years to make the elections go one war or the other. And so 7,000 people, I'm told, actually called while he was on the show, and most of them who made it on the air read from the exact script that the Obama campaign had sent them.

Now in my case, they sent out the defamatory emails and called me I think a right-wing purveyor of smear of…smear merchant, I don't remember the whole thing, but the funny thing, I was in Chicago for the day, and I had to fly back that night when the show was actually going to air, so my segment was a two-hour debate between myself and an Obama supporter, who was a young lawyer in the area there, and so when people heard the show, the producer later told me, they started to call in until they realized it was a taped portion and then the last hour of the show was live. That was when they started to get through.

So they didn't quite get to me, but the idea here was, even in a place like Chicago, where I don't think there's much danger of Obama losing support, they feel like, because they can, they will intimidate the media. They'll intimidate talk show hosts, they'll intimidate - and we've certainly seen that in the Obama administration so far, they're trying to intimidate entire news networks. They just this week forced a newspaper out in California to change something they wrote about Michelle Obama. This is the kind of stuff you wouldn't expect a White House to do, and especially the Fox episode, which is so bizarre. Actually going on to everyone else's morning show, having your senior staff go out and denounce Fox News and tell them to shun Fox News, Nixon didn't ever go that far. And this all began with them being upset about one of the administration officials being fact-checked. I think that Chris Wallace called them the world's worst bunch of whiners or something like that. But it really is telling that a small provocation - quote-unquote - like that would lead to the White House lashing out, sort of a petulant, petty, un-presidential certainly, kind of reaction.

And that's something that, when you talk about the Obama administration going after enemies, whether it's Karl Rove, or whoever the Bogeyman happens to be, if it happens to be the Koch Foundation, releasing their tax information - I mean it's par for the course. You would expect them to go after a lot of the big political figures. But some of the other ones, it's questionable.

And to hear what what Obama even says about the average voter is kind of troubling. Most presidents, and Clinton was a master at this, they know how to make everyone think that they like them. But Obama is the first president I'm aware of who - the whole quote about clinging bitterly to guns and religion I think really tells an underlying story, because this is the same president who, he said that behind closed doors, who in front of teleprompters will say things like "you have to sit in the back seat, the back of the car, you can come for the ride but you have to sit in the back," or "I don't want to hear you do a lot of talking - you're the people who screwed this up," that's the kind of thing that - and then, of course, "we're going to reward our friends and punish our enemies" - that's really just, there's a certain contempt there for anyone who disagrees with him that I think, again, is deeply un-presidential.

NB: So you talk about ways to sort of get at gangster government, to minimize its impact or prevent it from taking hold. Can you talk about some of those?

FREDDOSO: I've been asked several times, "well who's the un-gangster? Who's the anti-gangster government candidate we can get behind to stop this form happening?" And my answer is always that I don't think there is anyone who, given the kind of power the presidency has today, can really be trusted with it. I think that Obama is exceptional in his ability to abuse the power of the presidency, again in part because of his Chicago roots, I think because he's shown this deep arrogance and the feeling that he knows better about everything, better than markets know about economics, better than experts know about just about everything.

John Adams, who was our second president, and who wrote beautiful words about the right of everyone to government that concerns itself chiefly with the common good, and not with the honor or profit of any one man or family. And yet, as president he signed the Sedition Act, which outlawed criticism of the president, basically because he couldn't take the criticism he was getting as president. It's something he regretted a lot later in life, but it goes to show you that if you can't even trust John Adams to live up to the principles that he himself put forward and discussed so much, how are you going to trust - I don't care what Republican you want to insert - Mitt Romney, Tim Pawlenty, whoever, what makes you think you can trust them with the absolute power the presidency has come to represent?

NB: So it's institutional?

FREDDOSO: It is institutional. I mean, we've seen over the years the executive has increased its power at the expense of a very complacent congress that doesn't step up and assert its role. And Obama was again uniquely qualified to exploit the brokenness in the system, but the system was already broken by the time he got there. So the question is, what can we do - I mean, you can beat Obama, and that puts an end to gangster government for now, but how do you prevent this from happening again? And how do you put more checks on the presidency?

I make a couple of suggestions in the final chapter of Gangster Government about this. And one is, we saw over the first two years of the Obama administration, there was essentially no congressional oversight, because the Democrats did not want to provide oversight, and while he was taking over majority ownership of General Motors, we had the House Oversight Committee holding hearings on making sure that every federal building has the same number of male and female commodes in its restrooms. And then holding hearings on leafy green marketing agreements and all kinds of inanities like that.

I wonder whether it's time to do something they do in Israel and many of the UK commonwealth countries, which is have the opposition, the party opposite the president, chair the oversight committee. Because as much as you might hate having your guy dinged by Henry Waxman when he's president, the alternative is a presidency without any oversight, and that's what we've seen for the last two years. You know, I don't think that the Republicans did a great job of policing the Bush administration between 2001 and 2006. I think it would be healthy for the country as a whole.

Another change that I think is a simple change is that the recess appointment power should be abolished. President Obama has abused it in ways that his predecessors never did. We have Donald Berwick now as the head of Medicare and Medicaid despite a shady financial background and serious questions about his extreme ideological stances on health care. He's going to make decisions about millions of people's health care despite not having been confirmed by the Senate. Not only that, but he was given this recess appointment before there was even a single hearing on his nomination because Obama didn't want him to have to answer questions about his shady financial situation and his extreme ideological views about health care. At least with John Bolton, who also got a recess appointment, we had hearings. We heard all about his supposedly horrible temper and how he mistreated his staff and all that stuff. At least we got a public hearing about it. With Obama, we're getting people appointed in sort of sub-rosa ways. We're getting people appointed to lower positions to head agencies, leaving the top job empty because that one would require Senate confirmation, as with the Consumer Financial Protection Bureau and Elizabeth Warren. Obama is abusing that appointment power.

The recess appointment made sense when the constitution was written and they expected Congress to be around for part of the year as they were for about a century if not more. But, you know, today we have a Congress that's pretty much in session year-round. There's no reason to give the president that extra power of appointing someone clearly not because he can't get ahold of Congress, but because he can do it because the Constitution allows it. They should amend the Constitution. I think that that's something there would be a lot of bipartisan support for.

So anyway, those are a couple of suggestions. The other ones are more complicated and require more constant - you know, they're not simple silver bullets like those. The need for members of Congress to read and understand the bills they're voting on. Maybe we need a single subject - I know a lot of states have single-subject rules about their legislation - but the Obamacare law is such an abomination this way. You have sitting Senators like Bill Nelson of Florida, still walking around and saying things that are just wrong about what is in the bill that he voted for. He's talking about how "oh, well don't worry about these court cases because it has a severability clause." No, actually, it doesn't. So not only has this Senator not have any idea what's in this bill he avidly supported and voted for, he hasn't even been reading the news coverage of the bill, because every - the New York Times and NPR are reporting that there's not severability clause in this law. It just goes to show you that one of our greatest enemies as a people is the laziness and just craven party-line behavior of a lot of our legislators. And the Obamacare drama, in which, again, Obama is making this massive power grab over a huge swath of our economy, we saw the Congress just roll over and play dead for their guy, for Barack Obama. That's just so dangerous.

And the other thing that's dangerous about that particular bill - something else that I would counsel legislators in the future is to be really, really careful and specific when you make laws, because if you leave a lot of room for the regulators, they are going to cause far more trouble down the road. I already brought up this business about the national mediation board changing the rules for election laws once Obama got his people in there, for union elections. Well if Congress had just been more specific about that in the National Railroad Act originally, we wouldn't have that problem today.

If Congress had been more specific about the Clean Air Act, we wouldn't be talking about regulating the gags that you and I exhale as we talk, carbon dioxide, under that act, which it was never meant to regulate. I mean you just look at the amounts involved, and it's very clear that it doesn't make any sense to regulate it that way. Whether we should be regulating it or not, it doesn't make sense to regulate it under the Clean Air Act. And if Congress had been more specific about what pollutants they were actually regulating, we wouldn't be in that situation today.

And Obamacare - we're going to have a lot of trouble unpacking all the little land mines that are in there. The regulators are going to be able to do all kinds of things. And when we get to the point that we're actually seeing the IPAD, the Independent Payment Advisory Board, telling old people you're too old to get cured of cancer, I wonder whether then we're finally going to get to the point of, if it gets that far, provided the courts uphold the law, or part of the law, who knows - we're just looking at a train wreck. For every law where Congress isn't careful about how they word things, you give the regulators an inch, and they will take a mile.