Bill Black: The Clintons Have Not Changed – The Clintonian War on the IG Watchdogs

By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Originally published at New Economic Perspectives

Secretary Hillary Clinton is asking Democratic voters to believe that she has experienced a “Road to Damascus” conversion from her roots as a leader of the “New Democrats” – the Wall Street wing of the Democratic Party.  When exactly this conversion occurred is never stated, but an interesting fact has emerged that demonstrates it did not occur during her service as the Secretary of State.  A Wall Street Journal story provides the key facts, but none of the analysis.

Newly released emails indicate that former Secretary of State Hillary Clinton and her top staff were involved in the selection process for the State Department’s internal watchdog, a position that ultimately went unfilled throughout her four-year tenure.

The WSJ’s angle is that such involvement in the selection of the Inspector General (IG) is a threat to the IG’s vital independence.  True, and also true as the story notes that Hillary was far from rare as an agency or department head in seeking to select behind the scenes the supposedly independent IGs.

The function of the IG is to “speak truth to power.”  Naturally, “power” hates IGs with a purple passion.  Government leaders are most likely to hate having its abuses made public by IG when the government leader is secretly acting in concert with immensely powerful private leaders for their mutual benefit at the expense of the public.

What the WSJ missed is that the Clinton’s, for decades, have sought to destroy the independence and effectiveness of the IGs precisely because of the threat that they pose of blowing the whistle on these abuses.  The Obama administration, of course, is famous for its prosecutions of those who blow the whistle on such abuses.  The real story is not that Hillary attempted to select a lap dog as IG – the real story is that for her entire tenure as Secretary, four years, she left unfilled the leadership position of the only institution in the State Department dedicated to maintaining integrity and preventing the abuse of public power to aid cronies.  That aid, of course, comes with the clear expectation that the cronies will make the head of the State Department wealthy as soon as she or he steps down.  There is no possible defense for that, and it does not happen accidentally.  The primary blame goes to President Obama, who made no nomination for the position for the entire four years.  It wasn’t Republican intransigence that explains this scandal.

Hillary and Obama Renewed Clinton’s War on IGs

Bill Clinton and Al Gore installed Bob Stone as their official to oversee the implementation of “Reinventing Government.”  Stone reserved his greatest hate for the Inspector Generals, claiming in his book (Confessions of a Civil Servant) that their primary “contribution” to government is “stifling innovation” (p. 156).  Stone wrote that he has no confidence that IGs are effective against fraud, and made the old joke that their function is to “shoot the wounded” after a battle, and then cited favorably the even older quotation from President “Teddy” Roosevelt deriding “critics” of the “strong man.”  The tone of the quotation is one of disgust that “cold and timid souls that know neither victory nor defeat” (the IGs) have the impertinence to criticize great men like Teddy (and Stone and CEOs) – who are infinitely superior to IGs.  The “strong man” transcends normal moral codes.  (Teddy was a contemporary of Friedrich Wilhelm Nietzsche.)

“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”

I have written previously on the essential and rare role that government officials play when they “speak truth to power.”  Roosevelt and Stone and many government leaders share a virulent contempt for those who speak truth to power when they hold power.  Tom Peters’ foreword to Stone’s book emphasizes Stone’s arrogance and nastiness to anyone who had the temerity to disagree with him, noting that he was famous for his refusal to “suffer fools lightly.”  Stone knew that any government official who sought to prevent fraud was such a “fool.”  The Reinventors shared this contempt for anyone who disagreed with their dogmas.  In a prior article, I quoted in some detail their openly expressed intention to force out anyone who disagreed with their policies.  The journalist who led the “reinventing government” movement advised that it was essential that the Clinton administration not “tolerate resistance” to the movement’s dogmas.

Neil Barofsky (SIGTARP) explains in his book how the IGs responded to the Reinventors’ unholy war against the IGs (Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street).  The IGs became exceptionally cautious in speaking truth to power.  Gretchen Morgenson rightly emphasized this process in her analysis of the key disclosures in Barofsky’s book.

“‘The common refrain went like this,’ Mr. Barofsky writes.  ‘There are three different types of I.G.’s. You can be a lap dog, a watchdog or a junkyard dog.’ A lap dog is seen as too timid, he was told. But being a junkyard dog was also ill-advised.

‘What you want to be is a watchdog,’ he continues.  ‘The agency should perceive you as a constructive but independent partner, helping to make things better for the agency, so everyone is better off.’ He also learned, he says, that success as an inspector general meant that investigations come second. Don’t second-guess the Treasury. Instead, ‘focus on process.’”

Hillary and Obama made sure that they did not even have to risk their “lap dog” developing a spine.  No IG was their ideal world.

Hillary’s war on the IGs has intensified in the last week, even as she unintentionally offered an example of how critical truly independent IGs are to protecting the American people.  The title of a recent article was “Clinton chief attacks State Dept. watchdog.”  The “watchdog,” of course, is the IG.

John Podesta, the chairman of Hillary Clinton’s presidential campaign, says there are “serious questions” about the integrity of the State Department Office of Inspector General (OIG).

The OIG is locked in an increasingly contentious fight with Clinton’s campaign on a host of issues, including her use of a private email account during her time as secretary of State.

It has also reportedly subpoenaed the Clinton Foundation for documents related to charity projects and is investigating close Clinton aide Huma Abedin’s work as a “special government consultant” while she worked at State.

A source within the OIG contacted The Hill claiming that the office has grown increasingly partisan, accusing it of having an “anti-Clinton” bias.

Told by The Hill about the remarks, Podesta described the source as a “whistleblower” whose comments called into question the integrity of the OIG investigations.

The idea that the State Department IG, appointed by President Obama, is “partisan” in the sense of being “anti-Clinton” is facially bizarre in that Obama is a strong supporter of Hillary.  Further, anything that embarrassed Hillary would embarrass Obama.  It appears that there are competing leaks from the IG’s office.

The source charges that State Inspector General Steve Linick is “excessively deferential” to Emilia DiSanto, the OIG deputy director and a former aide to Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa).

Grassley is at the center of several investigations about Clinton, including whether Abedin was overpaid by the government while working for the State Department. He’s been aided in his probe by what he says is a “confidential source” at the OIG — Democrats charge this is DiSanto.

“Our work is becoming overtly anti-State Department, pro-Republican, and anti-Clinton,” the OIG source said, charging that DiSanto is working with an “active partisan mandate to undermine both the State Department as a federal agency and Secretary Clinton as a presidential candidate.”

The claim, however, does not explain why an Obama appointee (Linick) would be “excessively deferential” to a subordinate who had been a Republican staffer.  The only logical reason is that the facts found by the IG’s investigations had produced serious concerns in Linick’s mind.  “Excessively deferential” is an odd and vague claim for a purported “whistleblower” to make against his boss.

Contemporaneously, however, Hillary was unknowingly endorsing the Nation’s critical need for independent, vigorous, and brave IGs.

Presidential hopeful Hillary Clinton said last month that she was “totally appalled” by what she described as Navient’s “outrageous” behavior toward borrowers.

But she, and the American people, would not have known of this “outrageous” behavior if it had not been for the Department of Education’s IG penetrating a cover up led by the Department’s leaders.

The U.S. Department of Education conducted a bogus investigation into allegations that student loan giant Navient Corp. violated its lucrative government contract, leading the Obama administration to mislead the public last year when it proclaimed the company didn’t cheat servicemembers on federal student loans, according to an audit by the department’s inspector general released Tuesday.

And thanks to the department, which had contradicted federal prosecutors with its announcement, Navient not only kept its contract — it got a raise, too.

For profit educational corporations have often proven to be notorious fraud factories.  Navient added a special degree of infamy to its frauds by specializing in ripping off veterans.  The Department of Education has been tepid or even obstructionist in cracking down on these frauds.  Its leadership rewarded Navient’s fraudulent practices even after they were caught red-handed targeting veterans.  Bill Clinton personally, and both Clintons through and the Foundation have long profited from the massive largess of notorious for-profit schools.

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  1. EndOfTheWorld

    HRC is, and always has been, bad news. She shouldn’t have even run for prez the first time. She was a horrible secretary of state. Explain to me why the US had to ruin a harmless country like Libya. I hope the indictment comes down very soon, so Bernie can just be presumed the Democratic nominee.

    1. EndOfTheWorld

      BTW, maybe Bernie was being strategic and not just “a mensch” when in the early going he stated: “Nobody wants to hear about your damn e-mails.” Now the thing has festered long enough that it can’t be ignored, but it’s probably too late now for any other Democrat to jump in and win the nomination.

      1. Arizona Slim

        Sanders was indeed being strategic. He’s a much smarter politician than, oh, Hillary.

    2. Chris A


      “Among the principal concerns in Washington, London and Paris were the increasing Chinese and Russian economic interests in Libya and more generally Africa as a whole. China had developed $6.6 billion in bilateral trade, mainly in oil, while some 30,000 Chinese workers were employed in a wide range of infrastructure projects. Russia, meanwhile, had developed extensive oil deals, billions of dollars in arms sales and a $3 billion project to link Sirte and Benghazi by rail. There were also discussions on providing the Russian navy with a Mediterranean port near Benghazi.
      Gaddafi had provoked the ire of the government of Nicolas Sarkozy in France with his hostility to its scheme for creating a Mediterranean Union, aimed at refurbishing French influence in the country’s former colonies and beyond.
      Moreover, major US and Western European energy conglomerates increasingly chafed at what they saw as tough contract terms demanded by the Gaddafi government, as well as the threat that the Russian oil company Gazprom would be given a big stake in the exploitation of the country’s reserves”
      From Bill Van Auken/

    3. papicek

      RE: “Explain to me why the US had to ruin a harmless country like Libya.”

      Because Sarkozy was slipping in the polls, Cameron wanted the distraction, and Hillary wanted to be “the one who got Gadhafi” to get elected.

      1. NotTimothyGeithner

        Don’t forget the relative ease. The Pentagon didn’t want French jets dispatching Gaddafi. In the case of Syria, the same Pentagon didn’t want to see their toys shot down.

  2. voteforno6

    With this sort of reaction to the OIG, the Clinton campaign seems to be telegraphing just how serious this issue is. I’m a bit surprised that the Republicans haven’t picked up on this yet. Then again, when it comes to the Clintons, the Republicans have a long history of complaining about the wrong things.

    1. Christopher Fay

      Scary thing is, Republicans will attack her about the email server. But not the contents of the emails and timing of very busy schedules and the related corruption. Republicans will attach her about Benghazi and the dead. But not about the Neocon generated ME / NA spending operations leading to loss of treasure and brown peoples’ lives.

      1. Woodrow

        “Republicans will attack her about the email server. But not the contents of the emails” –

        That’s because the server itself, and the subsequent transmissions are prima facie violation of law, the contents of those emails would just ad to the initial violation/charge. Of course, during an era where an equal rule of law simply no longer exists, does it matter anymore? If you’re of the serfdom classes, you get hammered by the law (unless you can afford decent representation), for the beautiful people, the rule of law simply no longer applies.

        1. AnEducatedFool

          That has always been the problem with the Republicans and the Clintons. If the Republicans really wanted to take out Kilary they have had ample opportunity. The e-mails about the true motivation of US and French involvement in the topping and murder of Gaddafi show that she lied. Her ongoing role in aiding and abetting the genocide of Black Africans in Libya but Islamic extremists is revealed in the e-mails. Kilary’s role along with the CIA in arming ISIS and Al-Qaeda in Syria are also in the e-mails. The Republicans will not attack her on these issues because many of them especially the neo-cons support her actions.

          Everything changes in Trump runs against her. He is running against the neo-cons in DC. I do not doubt that he will bring up these issues against her. If Kilary attempts to go after him for misogyny he can simply attack Bill Clinton since by contemporary standards he is a rapist.

          1. rich

            If Trump is “running against the neocons”, then why did he name Richard Haass as his go-to foreign affairs adviser?

          2. rich

            If Trump is running against the neocons, then why did he site neocon, Richard Haass as one of his principal foreign affairs advisers?

    2. NotTimothyGeithner

      They are still afraid of Trump. With Clinton, they can investigate an unpopular President from day 1. With Trump, they don’t know what motivates Trump. Giving the President dictator powers probably wasn’t a good idea. Given the federal crackdowns under Obama (we bug mosques now and pretty much everywhere else), a loose cannon like Trump isn’t being attacked by Washington elites over the treatment of the little people, he’s being attacked because Trump might use the imperial Presidency against anyone who irked him over the years.

      The GOP is the friend of the crown prince who just died leaving the throne to the prince’s you get brother who they ridiculed growing up.

  3. Christopher Fay

    Hillary’s saving us money, what was there going to be watched? It’s Hillary. She’s got our back


  4. ScottW

    No Inspector General while Hillary’s Sec. of State. Private email server. Bill out parading around with foreign governments while Hillary supports arms sales to shady Middle Eastern Governments. A Deputy Chief of Staff who was at State, the Foundation and at a Clinton aligned consulting firm. Supporting Free Trade Agreements after expressing public opposition.

    The Clintons are one thing–consistent in their corrupt behavior. Never having had to pay for corrupt behavior, why would they ever stop?

  5. KYrocky

    The past is prologue. History shows that what flows in Hillary’s political veins is new Democrat, Rubinite, Peterson, Wall Street dominated blood. I agreed with her when she spoke of a vast right wing conspiracy, as it was obvious to anyone paying attention, and I could understand the Clinton’s defensive secrecy given the relentlessly personal assaults they were under. But I object to the epidemic of secrecy that has infested what should be the public sphere of our government.

    Clinton, then Bush, and now Obama have increasingly shielded their official actions from the public. And what should be obvious to anyone paying attention is that they are doing so to hide their actions from a public that would object, because at a minimum, they are unethical, or because they are illegal.

    Nothing, absolutely nothing, in Hillary’s past offers any a glimmer of anything different. Democracy requires transparency so that the public is properly informed and has oversight with which to hold people accountable. Obama promised to have the most transparent administration in history. He lied. Nothing she says today suggests Hillary would change this, and her past points to her making it worse.

  6. MIchael C.

    The “unlikeability” factor of Hillary Clinton, and her husband Bill, grows ever deeper in the American public. She drips with a uncouth and meglomaniacal drive to be president. I am not sure she can win an election, even with many voters pulling the lever for her in fear of the greater evil. I am not sure she is the lesser evil, and I think others may feel the same way election time.

    1. Deloss Brown

      Mmmmmf it’s hard not to think she’s the lesser of two evils when she’s running against a candidate who’s openly deranged–and I can guarantee she will be running against such a one, even before the Republicans pick one to nominate. All of theirs are deranged. They had a “deep bench,” and they were all deranged. If Hillary inspires a large number of voters–and I’m a Sanders fan, but apparently she does–maybe they’ll all come out and vote a straight D ticket, which might help us in that Home for the Deranged which is our Congress. And I doubt that Hillary would nominate another Scalia, Alito or Thomas. She probably wouldn’t know where to look, for one thing. Did I mention that I’m a Sanders fan?

        1. jrs

          care to list all of Trumps left wing positions? single payer – nope he’s not for that anymore, read his actual healthcare proposals. a few social issues like abortion? oh maybe but he keeps changing positions there as well (truthfully I don’t’ see these issues as really being right or left at all, but in the American political system they usually are seen that way) opposition to trade deals? … ok maybe that.

          I’m not sure Kasich is deranged, but he is a warmonger for sure, then so is Hillary. Rubio might not be deranged but he’s a neocon and a neophyte.

          1. Kris

            Trump is definitely to the left of Clinton on so-called “free trade” deals and on warmongering. The former Yugoslavia, Iraq, Libya, and Honduras are all foretastes of what awaits us in a Clinton administration. I would never vote for Trump, but I will never vote for Hillary, either.

      1. AnEducatedFool

        I do not know how old you are but younger Bernie supporters will not vote for Killary Clinton. I do not know any people under 30 that will vote for Clinton. I attend a local community college (prepping for grad school) outside of Philadelphia in an area that Killary will easily carry thanks to a lot of older feminists that still use the feminist card to justify their vote.

        Clinton’s only path to victory in the General is to carry southern states that the Democrats always lose. She is going to get killed in the Rust Belt. Trump knows how to talk to disgruntled white voters. The only one who will stop him is Bernie since they are going after the same voter.

        I do not know how she can win if she loses Ohio.

        1. Deloss Brown

          If you’re asking me, EF, I’m 74. The first Presidential election I got to vote in was against Barry Goldwater. I am delighted when Republicans say they won’t vote for Trump. I’m not delighted when Democrats say they won’t vote for Hillary. I send money to Bernie. At the risk of breaking Godwin’s law, I’d like to point out that in 1932 even the Social Democrats voted for Hindenburg, because the alternative was the leader of the Party of the Openly Deranged. Hindenburg won the election–Wikipedia says he owed his victory to the Social Democrats–but due to the peculiarities of the Weimar Constitution, everything turned out for the worst. Shaw paraphrased Hegel: “We learn from history that we learn nothing from history,” but I hope we’re a little smarter than that.

          1. Blink 180

            The Hindenburg camp had their own version of the LOTE pitch:“Better a zero than a Nero”. Even at the time, plenty of people could see that that was a sure-loser strategy, and said so.

            The peculiarities of the Weimar constitution weren’t really any more peculiar than those of any other representational government before or since. They do make a convenient scapegoat for the ensuing disaster though.

        1. EndOfTheWorld

          The Libertarians have their convention in July, and they might put up an interesting nominee. Could be Jesse Ventura or McAffee of net security and Belize escape fame. Ventura would be a good prez, in my opinion.

        2. Vatch

          If the Democrats give us Hillary, I will vote for a third party candidate, almost certainly the Green candidate, even though it would feel good to write in “Bernie Sanders”. Why? Two reasons:

          1. Because write-ins don’t get any votes in the Electoral College, so such votes are merely symbolic. A third party vote is just as symbolic as a write-in for Bernie Sanders, but the third party vote also has substance.
          2. In some states, if a third party gets above a certain threshold of votes, it will be easier for that third party to get on the ballot in the next election. A write-in vote for Bernie Sanders does not do that.

  7. Political Economist

    This new group is merely Acorn. The group that mobilized black voters and was thrown under the bus by Obama.

  8. AnEducatedFool

    Excellent article. I hope Sanders will offer Bill Black a job in his administration. I’ve noticed that Black was often on panels held by Sanders.

  9. EndOfTheWorld

    That’s where Bernie can really do some good. He can’t snap his fingers and have medicare for all, but he can put in SEC heads, SecTreasury, and economic advisers that make sense, like Bill Black, yes, who put some bankers in jail after the S&L debacle under Reagan. Iceland put 13 bankers in jail recently. Here in the cowardly US they just pay a fine amounting to a small percentage of what they stole. No problem for them at all. Just a cost of doing business.

  10. Dick Burkhart

    I’m a Bernie fan, but it would be nice to see some real evidence against Hillary documenting nefarious things in those emails. Speculation is not enough. It could be mostly about the right wing conspiracies against the Clinton’s, which we know are all too real. But if there were sweat heart deals benefiting the Clintons or their Foundation, that would be real evidence.

    1. EndOfTheWorld

      I’m not a lawyer, but apparently it’s against the law to put secret info on an unprotected server. As in–that’s against the rules—you can’t do that. Doesn’t have to be nefarious. David Petreaus received some punishment for it.

    2. Lambert Strether

      That would be in the half of the emails Clinton decided not to release, I would think. At some point, though, the money in, policy out pattern becomes a little too obvious to ignore.

  11. Percy

    Perhaps the IG system is simply too flawed as a concept. The nation should consider replacing (or supplementing it) with a new Tribunate of the People, elected by and responsible solely to the People, as in ancient Rome. Members would be elected for a specified term, with circumscribed ability to serve more than one term, and be granted unfettered veto power over legislative actions by Congress and rules made by departments and agencies. Cap the wealth (income and assets) of those eligible for election to this Tribunate and that of their family members and preclude them from participating as employees, officers, directors, partners and the like of anything but small, closely held companies. Immunize their decisions from judicial review, perhaps with an exception for extreme circumstances, but then only at a federal appellate level. Maybe that would work.

  12. Tony Frank

    Another clinton felon in the white house. What has happened to what was once the greatest country on earth?

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