04 April 2018

The Mainstream Wing of the Democratic Party in a Nutshell

You remember Donna Shalala?

She was in the Clinton cabinet, and then, as president of the University of Miami, she attempted to sabotage a unionization effort by janitors, and now, it appears that she was pulling heavy salaries from the boards of a health insurance company and a real estate developer.

No laws were broken, but this is fundamentally corrupt, and now she is the front runner for a House of Representatives seat in Florida because she is raising big bucks, much of it, I am sure, UnitedHealth and Lennar homes:
Here's a sentence that perfectly explains the state of Democratic politics in 2018: Former Clinton Foundation chief Donna Shalala, who helped lead a major homebuilder during the 2008 housing crash and also made $5 million after sitting on the board of a massive, for-profit health insurance company, is poised to steamroll a crowded field of Democratic competitors in a race for the U.S. House.

Earlier this week, Shalala announced her candidacy for retiring Rep. Ileana Ros-Lehtinen's seat representing downtown Miami, Little Havana, and Miami Beach despite the fact that seven Democrats are already battling in the primary, including more than a few solid candidates without huge red flags in their pasts.

Shalala, who declined an interview through campaign operative Fernand Amandi, paints herself as a progressive with deep understanding of how Washington works. But there are big unanswered questions about her time on two corporate boards tied to major crises in American policy.

As Americans debate how to fix a for-profit health insurance system that is both cruel and the most expensive in the developed world, Shalala will have to explain how she profited handsomely from her time on the board of a health-care giant.

After she served as the U.S. Health and Human Services secretary under Clinton, she used that experience to secure herself a gig on UnitedHealth's board. She wound up accumulating more than 61,000 shares of company stock, which she then sold in 2005 for more than $5.3 million. Shalala has not yet taken a public stance on the issue of Medicare for all, but signs suggest she might ultimately endorse the idea. Regardless, she'll have to sell voters on trusting a former health-insurance board member to work against for-profit insurance companies.

Even more troubling, Shalala sat on the board of Lennar Corporation, one of America's largest homebuilders, from 2001 to 2012. Securities and Exchange Commission filings show Shalala earned $113,000 in combined compensation (mostly stock awards) in 2011. To avoid a conflict of interest, the then-University of Miami president left the board in 2012 when Lennar CEO Stuart Miller Was angling to become vice-chair of UM's board. (He became a UM trustee in 2002.) She left UM in 2015 and rejoined the Lennar board two years later.

During the decade Shalala helped lead the company, Lennar played a major role in fueling the global recession. Most obvious, Lennar overbuilt: The mid-2000s housing boom came, in part, because D.R. Horton and Lennar were buying up every tract of land they could and slapping together houses as fast as they could. Miami-Dade County, in particular, got hammered during the Great Recession. A 2009 county report laid bare the obviousness of the overbuilding problem. County economist Robert Cruz wrote that from 2002 to 2007, the county's "vacant and for sale" rate spiked by 52 percent, and a particular construction boom from 2005 to 2007 led to an extremely acute vacancy hike just before the economy crashed.
It's the hypocrisy that rankles.

Between the board engagements, and the speaking gigs to captains of industry as back end payoffs to their political career, is it any wonder that the typical voter does not believe when people like her claim that they will fight for the ordinary person.


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