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Diamond Jim's Enron Bailout

Inside Track


Published January 29, 2003 at 5:00 p.m.

No, not our Gov. Jim Douglas? Please, say it ain't so!

Wish we could.

You may recall that one of the highlights of Diamond Jim Douglas' budget address last week was a proposal for tax relief for Vermont's agriculture sector.

"I am particularly concerned about the effects of property taxation on our struggling family farmers," declared our new Republican governor. "So I propose that we eliminate the statewide property tax on all agriculture and forest land and buildings enrolled in the current-use program, saving farmers and forest land owners $3.3 million each year."

Vermont's Current Use Program provides property tax relief for landowners who work their land, plow their fields and harvest their timber. Their property gets taxed at its use value, rather than its value as marketable real estate.

But rookie Gov. Douglas proposed going an extra mile. Such a sweet guy! A compassionate conservative if ever there was one! But, before you get all mushy about Ma and Pa getting a little help with the herd, think again.

Seven Days has learned that one of the needy recipients of Diamond Jim's proposed tax break for Vermont landowners in the current-use program will be multimillionaire Andrew Fastow, the former chief financial officer for Enron.

Mr. Fastow is facing 140 years in prison if convicted on fraud, money laundering and conspiracy. He is currently free on a $5 million bond. Enron Andy also happens to own a cabin on 68 wooded acres in Norwich, Vermont.

According to the Norwich Town Clerk, Enron Andy already gets his property taxes cut by about 50 percent because his woods are in current use. That reduces the assessed value of Mr. Fastow's 68 acres by about 50 percent. Instead of paying $8000 a year in property taxes, Fastnow only pays $4109. Now Jim Douglas wants to give Enron Andy an even bigger tax break. No doubt, it's the first good news Enron's former CFO has heard in a long time. Even indicted millionaires appreciate tax relief, you know. Thanks, Jim.


You know, it's been reported that Mr. Douglas proudly claims to have been a protege of former Gov. Richard Snelling. But we simply can't imagine King Richard bailing out an indicted Enron millionaire.

Fact is, in the last three weeks, Diamond Jim has been acting more like a protege of George W. Bush. "Tax cuts for the rich" appear to be the name of his game.


First Class Stonewalling! -- Kudos to Ed & Louise for Monday's textbook example of political stonewalling. Fletcher Allen CEO Ed Colodny and Trustee Chairman Louise McCarren didn't give an inch to Congressman Bernie Sanders and his Fletcher Allen Task Force.

All the task force wanted was to hear Ed & Louise say they would ask their board to consider adding a couple non-trustees to the new committee reviewing hospital "governance."

Ed & Louise refused.

Ditto for requests that the Fletcher Allen board abide by the state's open-meeting law.

The Mary Fanny wagons were tightly circled. Openness will not be tolerated on Hospital Hill. Ed & Louise agreed to nothing. Absolutely nothing!

Deanwatch 2004 -- Our favorite presidential hopeful is everywhere this week and everyone's talking about Howard Dean, including leading scribes of the right wing like George Will, Morton Kondrake and Tucker Carlson. It's proof that Howard Dean, M.D. has succeeded in Phase One of his longshot run for the White House. He's established a secure beachhead.

And we're happy to report that Yale University, Ho-Ho's alma mater, has finally added Dr. Dean to its official list of "Yale Notables." It's an alphabetical list of several hundred notables with Yale connections, including the last three men elected president of the United States. Ho Dean would make it four Bulldogs in a row!

The Yale administration isn't alone in waking up to its overlooked 1971 graduate. On Monday the Yale Daily News did a feature on Dean titled: "Presidency beckons for a Yale prankster."

Oh, what a wild and crazy guy he was as a college boy in New Haven. Let's be honest, it was a wild and crazy time to be alive. The Daily tracked down a few of Ho-Ho's old buds. Turns out Dean was a big Beatles fan. The Magical Mystery Tour album was young Howard's favorite.

"[Dean] loved the album, ran around singing it all the time, and seemed to land on 'I Am the Walrus,'" Bill Kerns '71 said. "When you ran into him singing 'I Am the Walrus' you knew he was identifying with it and laughing at himself in the same breath. We all sang along with Howard, buzzed by his phenomenal energy."

And, perhaps, buzzed by the smoke from a leafy substance?

Old classmates recalled Dean's "magnetic personality," his "sense of humor" and the "glint in his eye." They remembered that Howard read The New York Times every day, was a scrappy football player, and was lousy at card games because he was "too expressive and gave away his hand."

Under "future occupation" in the 1971 Yale yearbook Dean simply wrote "living."

Far out. He's succeeded so far.

"[Dean] was famous for saying, 'Let's go to New York right now.' And everyone would get in the car and go to New York, even though it was midnight," said David Berg '71, an associate clinical professor of psychiatry at Yale. "He had a brother in North Carolina, and one night he said, 'Let's go visit Charlie right now.' He jumped in the car and drove to North Carolina and the amazing thing was that he convinced other people to follow."

Berg also spilled the beans on a little news scoop that, until now, eluded the Vermont Press. He told the Yale paper that, back during the controversy over civil unions in 2000, Dean took to wearing a bulletproof vest.

"It's true," said Dean's press secretary Susan Allen. Sweet Sue told Seven Days the governor had received a number of death threats from opponents of civil unions. Ms. Allen said Gov. Dean wore the bulletproof vest on about three occasions when he spoke at public forums during the height of the battle.

Nothing like death threats and a bulletproof vest to build character and fortitude, eh?

Political Eavesdropping -- It's a political story with a technological hook and it reinforces the adage that one should never, ever say anything on a cell phone one doesn't want the whole world to hear.

Seven Days has learned that one Wednesday afternoon last month, when the race for Speaker of the House was up in the air, one veteran Democrat overheard a friendly phone conversation between the soon-to-be Republican whip, Rep. Rick Hube of Londonderry, and Rep. Rob Rusten, a Halifax Democrat.

Rep. Francis Brooks (D-Montpelier) picked up the call on his police/fire radio scanner. Francis, you see, is an on-call Montpeculiar firefighter. Usually when his scanner picks up a phone conversation, Francis told Seven Days, he just "blocks it out." But this one was different. He quickly recognized the voices were those of two fellow House members.

"The conversation was ex-tremely friendly," said Brooks. Rep. Rusten sounded quite "chummy" with Rep. Hube. "It was the kind of conversation I'd have with a fellow Democrat," said Brooks. "Several kinds of things were intimated," he added, saying the "topic" of the cell phone conversation involved him.

Asked what he meant by that, Brooks the Democrat explained he would be affected personally by who won the upcoming race for Speaker of House, Republican Walter Freed or Democrat John Tracy.

Startled by what he heard on his scanner, Brooks told Seven Days he immediately picked up his phone and called Rep. Rusten. Brooks told him he'd just heard him speaking to Hube and noted it was a very chummy conversation.

Rusten denied he was cutting any kind of political deal or trading his vote in the Speaker's race for a choice committee assignment. And the member from Halifax asked the member from Montpelier if he'd heard any kind of deal being cut. Brooks said then, and told Seven Days this week, that he had not.

Rep. Rusten told Seven Days this week that he and Hube were talking about Act 60. Both men have ski towns in their districts. He said he never asked Hube, a Freed lieutenant, for anything in terms of a committee assignment. In fact, said Rep. Rusten, he did not decide who to vote for in the Speaker's race until after Christmas.

Asked who he did vote for, Rusten replied, "It's time to move on."

As for Rep. Brooks eavesdropping on his phone conversation, Rusten said, "I certainly trust Francis." He said that he accepts the fact that the eavesdropping was "purely by coincidence or accident." Rusten said he has "no negative feelings" about what happened.

Rep. Hube told Seven Days that when he first heard Rep. Brooks had listened in on his phone conversation with Rusten, he was "a little disturbed about the invasion of privacy." Hube, the new GOP whip, said he has since "had a conversation" with Brooskie about it.

"It's done. It's over," said Hube on Tuesday. "Let's move forward."

While Rusten the Democrat won't say who he voted for in the secret ballot for House Speaker, we do know that Freed the Republican won. We also know that six or seven Democrats crossed over and voted for him. And we know that Freed subsequently picked Rusten to be the vice-chairman of the powerful Ways and Means Committee. Those are the facts.


Meanwhile, Rep. Brooks told Seven Days that he subsequently became concerned about the legality of what he had done. He said he sought and received a legal opinion from the Legislative Council's office. The preliminary opinion he received indicated that there was "no problem."

But subsequently, said the Montpelier firefighter, he's been told that in 1994 a federal law was passed that made listening to a phone conversation in such a manner illegal.

The "caveat," said Brooks, is that scanner manufacturers were required to notify owners that after 1994 it was illegal. In addition, he said, they stopped marketing scanners that could pick up cell phone calls.

Brooks told Seven Days he purchased his scanner at Radio Shack sometime before 1994. And, he said, he never received a subsequent warning from Radio Shack about the law change.

"Federal law," said Brooks, "says that one has to break the law knowingly. Everybody agrees at this point that I had no reason to know."

Ignorance is bliss, eh?

House Backs Roe! -- Last week the Vermont House surprised many observers by voting by a 2-1 margin in favor of a resolution supporting abortion rights. It was the largest margin of victory in three attempts.

For three years running, Rep. Ann Seibert (D-Norwich) has introduced a pro-Roe v. Wade resolution each January to mark the anniversary of the landmark 1973 Supreme Court decision that upheld a woman's right to choose a safe and legal abortion.

In 2001, the first year of Republican control under Speaker Walter Freed, Queen Ann's Roe resolution passed 85-51.

Last year, the right wing was ready and dug in its heels. A floor fight erupted as Rep. Tom Depoy (R-Rutland) and Rep. Kurt Wright (R-Burlington) proposed an amendment supporting parental notification. After several hours of heated floor debate, the Depoy/Wright amendment was shot down and the Roe v. Wade resolution was adopted on a vote of 77-53.

Last week, Seibert's resolution marking the 30th anniversary of Roe v. Wade hit the House floor. Only Rep. Nancy Sheltra (R- Derby) rose to express her opposition. The religious right had decided not to put up a fight this year. Apparently they counted noses. The resolution sailed through on a 92-46 vote.

Kwik Stop Kurt voted for it. But Tommy "Guns" Depoy was noticeably absent from his seat when the roll was called. Maybe he was outside adjusting the roof on his red BMW convertible?