1996 - Northumberland, England
A boy, around six or seven years old, and his grandmother gazed upon a factory which had been reported to be bankrupt. From their parked bicycles, they walked towards the main entrance.
A young man emerged from the financially doomed building. Thin and tall, he stood remarkably straight. His wavy red hair was swept back from his forehead. Head held high on relaxed shoulders.
The grandmother and the boy stopped, electrified by the sight of purposeful mien. She focused on the young man’s face. It reflected her grandson’s passionate earnestness and innocence, untouched by humility. Eyes, the aim of an artist’s quest: the focus of a photographic memory, the uncompromising twinkle, and the intensity that could come only from a brain of extraordinary throughput.
“A teenager - ,” observed the old woman dressed in rags, “- but with the eyes of an active mind, the proud gait of the self-reliant, the aura rooted in rationality: the bearing of a thinker eager for action.”
Her eyes met the teenager’s.
“Hello, Ma’am. Hi kiddo. Have a fine day.”
“Hello. My name is Diana Washington. This is my grandson, Ian Washington.” The boy had a chubby nose and an eyepatch over his left eye.
“I am Apollo Marianto. It’s a pleasure to meet you.”
“You carry your name so well,” Ian greeted. “God of reason, you exude victory. Can this factory survive?”
“It shall, if it operates in freedom.” Apollo, an American computer and financial genius, had decided to finance the factory.
“I will see to it,” the little boy promised. Diana’s shining eyes embraced the boys.
In the succeeding days, Diana and Ian delighted in the infusion of investments into the factory. Its workers and their families rejoiced.
PROLOGUE 2
2000 – New York
Eliot Spitzer derived satisfaction from seeing fear in the faces of successful individuals. In the spring of 2000, he arrived at Lisa Jones Inc.
“Hello Apollo!” Spitzer gleefully greeted as he entered Apollo’s office. The Attorney General eagerly anticipated the look of desperation masked by obsequiousness.
“Mr. Spitzer.” Apollo did not attempt to hide his contempt.
“Breaking news and headlines within the hour will report that Lisa Jones Inc. and its CEO are under investigation.” The king did not feel bound to state the charges. “You will lose everything and rot in prison.”
“You threaten in my private property. Get out of my room in a minute and out of my building in five, or else.” Apollo’s face was as calm as his voice.
“Great pain awaits you, brother of Lisa Jones!” Spitzer snarled and then hastily left.
Shortly, an email was sent to employees and stockholders of Lisa Jones Inc. announcing that CEO Apollo Marianto would speak in ten minutes. The speech would be broadcast over the building’s public address system and on the company’s website.
Apollo’s voice was clear and fearless. “Dear investors and colleagues: the New York City Attorney General personally delivered a message a few minutes ago. Quote - Breaking news and headlines within the hour will report that Lisa Jones Inc. and its CEO are under investigation. – unquote. I expect armed troopers and reporters to arrive at any minute.”
A hundred New York State troopers wearing bulletproof vests entered, and many more surrounded, the Lisa Jones Inc. building. One of its security personnel quickly stopped elevator service. A trooper asked a security guard to turn the elevator service back on.
“Use the stairs.”
“Marianto is at the top floor. This is obstruction of justice. Think again. Hard!”
“No one is obstructing you to use the stairs.”
“Get me your building administrator.”
“No one is obstructing you to go get him.”
“Where is he?”
“I plead the Fifth.”
The hundred troopers in the building listened to Apollo’s speech. Many turned on their two-way radios enabling the troopers around the building to hear it, too.
“This company has very high standards. I am proud of our hard work, integrity, and first-class business. I have never infringed nor will I ever violate anyone’s rights.
The Attorney General revels in violating Liberty. Like any tyrant, he has no self, so he seeks it out by destroying those who have. I am a selfish man! I will not be enslaved! I cannot compromise with tyranny - The successful and the affluent have rights equal to the inherent inalienable rights of every man.
I am honored to use the words of Patrick Henry: Is life so dear, or peace so sweet, or wealth and jobs so precious as to be purchased at the price of chains and slavery? There is but one course – Give me liberty or give me death!
The essence of a respecter of freedom and his opposite is: A respecter of man’s rights is self-reliant, thus, selfish. A dependent has no self-esteem, thus, selfless -- dependence breeds moochers, looters, and power-lusters.
I am proud to hold selfishness as a virtue. A selfish man does not rule nor can he be ruled. If the government deems selfishness a crime, then it has outlawed the Declaration of Independence and Individual Liberty. If a rich, successful individual is deemed a criminal for his wealth, then society has enshrined envy and irrationality as the good. If a brilliant achievement is considered depraved, then evil has triumphed.
I interact with others by reason and persuasion. I create wealth and jobs without infringing anyone’s Rights. I offer my best to the market place. My best creates economic power which the intellectually dishonest equate with coercive power. Economic power uses the tools of reason, persuasion, and innovation – it is devoid of coercive power. The government holds the monopoly to use legal force. When it intimidates a citizen, it has abandoned reason. It is no longer a protector but an aggressor.
Any law, any government act that infringes individual rights is unconstitutional. Patrick Henry said: ‘The Constitution is not an instrument for the government to restrain the people; it is an instrument for the people to restrain the government -- lest it comes to dominate our lives and interests.’
Power-crazed individuals defile the principles enshrined in the Declaration of Independence. A government that tramples on Rights has taken on the role of a thug.
President George Washington would say: King Eliot Spitzer, his ilk, and their facilitators are abhorrent!
The Attorney General has decided to destroy this company. To compromise with tyranny is to strengthen it. To expose the impotence of tyrants is to glorify freedom. Is my life so dear or this company so precious as to be purchased at the price of chains and slavery? I honor decent people who have been tyrannized – Give me liberty or give me death!”
Eighty-five troopers walked out of the building. Those who remained looked at their chief for directions. He asked them to follow the others and go back to their precincts. He removed his bulletproof vest and handed it to his second-in-command.
The chief trooper faced the security guard. “I have a warrant for Mr. Marianto. Let me do my job.”
As the chief trooper entered the elevator, many television crews broadcast live that the troopers were leaving the Lisa Jones Inc. building with no sign of Apollo Marianto. Photographers and reporters recorded every detail of the events.
The door to Apollo’s office was opened by his secretary. The chief trooper did not enter. Though he felt revulsion that his noble job had been perverted by a politician, his serious face registered no other emotion as he looked at Apollo. Apollo walked towards the chief trooper, and then followed him to the elevator.
Camera flashes exploded as the chief trooper and Apollo exited the Lisa Jones Inc. building. Apollo was not handcuffed. He walked with the bearing of a free man: proud and unafraid.
Trade volume in the Lisa Jones Inc. stock spiked up. Within the hour, instead of declining, the stock price rose by 20%! In the next hour, the price doubled.
Bill Gates instructed his broker to buy the stock; he deposited $5 billion of his personal money for the stock purchase. CEOs like John Allison of BB&T Inc. did likewise, as much as they could afford. Many employees of the 3,200 companies that Mike Milken financed into prosperity emptied their savings to buy Lisa Jones Inc. stock. Numerous residents in Nevada, the state where Milken’s brilliant innovation created around 600,000 jobs, followed suit. Some senior citizens instructed their brokers to buy the stock at any price. Students pooled their resources to do the same.
There were no sellers.
Press releases from the Attorney General’s office flowed. The popular media that battered Mike Milken rehashed their vitriol.
“Apollo Marianto is the resurrection of the decade of greed!”
“The unbridled greed and arrogance of a self-confessed selfish man merit extreme punishment!”
“The selfish speech – evil knows no bounds!”
“Pure evil – unbridled selfishness!”
“Marianto threatened Attorney General Spitzer!”
Apollo had been studying law and would take the bar examinations in a year. He did not hire a lawyer nor request bail. He did not answer any of the prosecutors’ questions. Spitzer ordered the arrest of other Lisa Jones Inc. employees, but everyone followed Apollo’s lead.
Apollo’s half sister, Lisa Jones, worried, “The inmates might believe the media’s vitriol that Apollo is evil.” She was terrified that inmates might hurt or kill Apollo.
In jail, inmates asked Apollo about making spectacularly huge amounts of money. “How could you make so much money without being a crook?”
“My mind and my effort create new wealth. If I did not think and endeavor, the new wealth I have created would not have existed. This fact shows that such wealth has not been taken from anyone. The Wright brothers invented the airplane – they created a value – no one had that value before. Thomas Edison created many great things. His inventions raised the standard of living for everyone. As a consequence of inventing more efficient products and methods, others are displaced. But such displacements are temporary and for the better. When a cart is displaced by a car, the cart manufacturer is displaced – if he values progress, he would endeavor to learn a trade involving the more efficient invention – this way, his displacement is temporary.
A valuer of the good distinguishes between the earned and the unearned. If the cart manufacturer is such a valuer, he would admire, not resent, the car inventor. In a free market, in a society where only reason and persuasion are used in production and trade, the only way to acquire wealth is to earn it.
Those who desire the unearned advocate the use of compulsion – they are looters. Lacking self-esteem, they believe they can’t compete in a free market. They don’t respect others and themselves – instead of living by their own effort, they claim entitlement to the fruits of their fellowmen’s labors. Those who do not distinguish between the earned and the unearned are intellectually dishonest. Those who champion regulation and expropriation are no respecters of rights.”
A young inmate named Ben Allen stayed silent but his mind was fired up. Apollo’s words stirred his soul.
A man twice Apollo’s age said, “There is a consensus that selfishness is evil. You don’t care if your stockholders lose money or if your employees lose their jobs. Not caring about others is evil.”
“My values are in a hierarchy. Liberty is topmost. I value freedom more than life because I don’t care to live as a serf. If Lisa Jones Inc. goes bankrupt, if its stockholders lose money, or if its employees lose their jobs, it would be the responsibility of Eliot Spitzer as well as the lawmakers and judges who enable him to act like a thug. In the same way that I will never desire unearned wealth, I will never accept unearned guilt.”
“Everybody says you are evil. Who are you to say everybody is wrong?”
“I think I’m good while almost everyone in the press and the population thinks otherwise. What do I go by? The truth, which I could objectively arrive at by using reason and logic. Not infringing anyone’s rights is good. Achieving wealth without such infringement is glorious. Many denounce the achievement of spectacular wealth as unbridled evil, but they evade the means by which that wealth is achieved. Such evasion is a great injustice. It destroys the good; hence, it is evil.”
“The media say you thumb your nose at public opinion. Why do you disrespect society?”
“I respect a society that respects Rights. I go by reason and logic, by my own mind. One who goes by public opinion or consensus is a second-hander, not an independent thinker. A second-hander, one with no self-esteem, primarily cares about what others think while a first-hander, a selfish independent thinker, primarily cares about the truth, his sacred honor, and his happiness.”
“Spitzer and the popular media tout that your refusal to answer the questions of prosecutors is tantamount to an acceptance of guilt.”
“They defile the Constitution.”
Some who hated Apollo wished he would be harmed in jail, but the inmates did not feel resentment towards him. The night before Apollo was to appear before a Grand Jury, his cellmate was replaced by a tall, muscled man with a scowling face. At his most intimidating, the man stared at Apollo.
Apollo did not acknowledge him in any way.
As soon as the lights were out, Apollo’s cellmate pounced. Thuds and grunts were heard by inmates in the nearby cells. There was a snap of broken bones, and then a final thud.
Apollo appeared before the Grand Jury without a scratch. He proved that brute force was no match against a dedicated mind.
Apollo answered all questions. The grand jurors pondered his words:
“I make much money for myself and my investors. I create wealth through sustained thinking and innovating. I trade with others using reason and persuasion. I worship Liberty. I have never nor will I ever infringe Rights. I say it with great pride: I cherish myself, my sacred honor, and my happiness. I am a selfish man!
I have delegated my right to self-defense to the government mandated by the Declaration of Independence and the Constitution to secure equal inherent inalienable rights. I await that government to do its noble mandate.”
The Grand Jury ascertained that the evidence presented against Apollo did not warrant trial.
Out of jail and walking to a waiting car, Apollo was asked by a young reporter named Eli Clark, “Mr. Marianto, what happened when you told Mr. Spitzer to get out of your office and the Lisa Jones, Inc. building, or else?”
“King Eliot did not stay to find out.”
“What would you have done?”
“I would have called the police.”
PROLOGUE 3
2002 – London and New York
On her deathbed, Diana Washington thought of the factory and the thousands more employees it hired. She held her grandson’s hands and whispered, “Ian, the government is putting shackles on the factory... because it is successful.”
“Rest your mind, Grandma. I vow to remove the shackles.”
Diana proudly admired her grandson, “A thinker with wings.” She saw in Ian what was unmistakable in Apollo.
“A conned world will hate Apollo and Ian. Their uncompromising integrity will be denounced as arrogance, their radiant joy as evil-selfishness. Others might be destroyed by this unspeakable injustice, but not my boys. Ian and Apollo will build sanctuaries for human joy. They will fight for their kind of world: a benevolent universe.”
Diana could not conceive of wickedness where opponents of happiness would plot to annihilate her beloved boys, where power-lusters would mark Apollo and Ian for destruction to stop them from erecting barriers that protect the innocents.
The memorial ceremony for Diana Washington was fit for a queen.
Within a month, Ian traveled to New York City. From the airport, he went directly to Apollo’s office at the top of the Lisa Jones Inc. skyscraper.
“Grandmother wrote you a letter.”
Apollo read the short request from Diana. He quickly recovered from his surprise. “I am but twenty-five and a guardian to a thirteen-year-old.”
That day, Ian’s instruction about the business world started. When Apollo brought him home, they went straight to the study. Engraved on the wide wooden door was the following:
“Honesty is fidelity to the truth.
The truth is what conforms to reality.
Integrity is fidelity to logic.
It is the refusal to hold contradictions;
It is the consistent cohesion of words and deeds;
It is honoring one’s mental creations
By giving them physical existence.”
Apollo showed Ian his Journal of Heroes. “George Washington rejected a movement to make him King of the United States, calling it, ‘Abhorrent!’ He is the embodiment of my morality: A moral man does not rule, nor can he be ruled by men.
By the time Thomas Jefferson was six, he had read most of the books in his father’s library. A polymath and polyglot, he is the greatest political thinker. I revere the author of the Declaration of Independence, the father of religious freedom, the advocate of the Bill of Rights, and the President who abolished the slave trade in the US. Slavery was obtruded on the Colonies by King George III. Thomas Jefferson inherited slaves. It was against the law to free them. When he was 26 years old, chosen for the first time to be a member of a legislature, he submitted a bill for the emancipation of all slaves. As a lawyer in 1770, age 27, he defended a slave, saying, ‘Under the law of nature, all men are born free.’
Abraham Lincoln extolled, ‘The principles of Jefferson are the definitions and axioms of free society… All honor to Jefferson - to the man, who in the concrete pressure of a struggle for national independence by a single people, had the coolness, forecast, and sagacity to introduce into a merely revolutionary document an abstract truth, applicable to all men and all times, and so embalm it there that to-day and in all coming days it shall be a rebuke and a stumbling-block to the very harbingers of reappearing tyranny and oppression.’
Thomas Jefferson said, ‘Your own reason is the only oracle given you by heaven.’ He regarded John Locke, Francis Bacon, and Isaac Newton the ‘three greatest men the world had ever produced.’
Isaac Newton, an English physicist, mathematician, astronomer, natural philosopher, and alchemist, set forth in mathematical terms the laws governing the course of the heavenly bodies. Thinkers marveled at the proportion, balance, harmony and order resident in the natural tendencies of the world. They concluded that the order was consonant with human liberty, that the natural order provided means for man to use his faculties for his benefit, and that man has natural rights.
William Pitt the Younger, one of Britain's greatest Prime Ministers, became the youngest Prime Minister in 1783 at age 24.
José Rizal passionately advocated knowledge and rights at a time when independent thinkers would surely die. I love his sculpture of a naked woman triumphantly raising a torch, arms stretched high above her head, body straight and proud, feet firmly atop a skull over a thick book. Showing man’s goodness and efficacy, the sculpture entitled The Power of Science over Death represents my values. The woman’s exalted pose is a salute to man’s intellectual and creative power.
At age six, Ayn Rand taught herself to read. I adore her books and her philosophy: Objectivism. I’ve read The Fountainhead a hundred times because it pleasures and fuels me. Reading Atlas Shrugged is like savoring the most delicious fruits from the tree of knowledge. Reading her nonfiction books, e.g. The Virtue of Selfishness, transports me to a sacred place of worship.
She admired Aristotle, the Father of reason and logic, as well as Thomas Aquinas, who said, ‘What reason shows to be true is absolutely true, so that the opposite is absolutely false and impossible.... Faith has to do with things that are not seen and hope with things that are not at hand.’
Ayn Rand regarded Victor Hugo as the greatest novelist in world literature because he depicted moral giants in his books. Their actions are heroic, noble, intelligent, and beautiful. A Romanticist, Mr. Hugo’s vision was always focused on the fundamentals of man’s nature, on those problems and those aspects of his character which apply to any age and any country. In Ninety-Three, he projected, ‘What greatness men are capable of, when they fight for their values’!
Ralph Teetor, a prolific inventor, invented cruise control. Blind since the age of five, Mr. Teetor built his first car, a one-cylinder, by age twelve.
At age thirteen, Bill Gates was writing computer programs.
The world owes a lot of its comforts and high standard of living to Thomas Edison. He said, ‘Genius is 1% inspiration and 99% perspiration.’ When asked about his over 2,000 failed attempts to make a working filament for the light bulb, he replied, ‘I didn't fail 2,000 times; I just found 2,000 ways not to make a light bulb.’
I am inspired by his life, as a boy and as a man. I love the movies: Young Tom Edison and Edison the Man....
The achievements of Edison are of public record: 1,368 patents out of which 1,093 are US patents. He founded several companies including General Electric. The world benefited and continues to benefit from his inventions.
In 1907, Edison-worshipper Henry Ford declared, ‘I will build a motor car for the great multitude. It will be large enough for the family, but small enough for the individual to run and care for. It will be constructed of the best materials, by the best men to be hired, after the simplest designs that modern engineering can devise. But it will be so low in price that no man making a good salary will be unable to own one – and enjoy with his family the blessings of hours of pleasure in God’s great open spaces.’
Henry Ford helped win World Wars I & II. He developed mass production for the B-24 Liberator bomber. In World War I and after it, American farmers fed all of Europe. In this critical period, Ford brought out his first farm tractor, the first to be produced on a massive scale and the first to be affordable by average farmers and rural citizens. The inexpensive Ford tractors as well as American farming saved Europe from starvation. Ford held that his tractors were the key to eliminating war and improving the human condition.
Ford was the first man to discover the advantages of mass production and the first to use an assembly line. He was the first to refute in practice the theory of class-warfare. Ford announced his $5-per-day program on January 5, 1914, raising the minimum daily pay from $2.34 to $5 for qualifying workers. Using the consumer price index, this was equivalent to $111.10 per day in 2008 US dollars.
Ford opened up his plant and methods to all who wanted to copy them. His system spread like wildfire through the automobile business and into other businesses. Prosperity for every person, including the poor, exploded. The population of the cities flourished, and after nearly 150 years, agrarian America turned into an urban civilization practically overnight.
Henry Ford invented mass prosperity! He extended his offer of employment and prosperity to any capable person who wanted it, including women, blacks, the handicapped, ex-criminals, and Jews. He stood alone against a mountain of criticisms, including accusations of bigotry. But his actions delineate and define him. It takes uncommon benevolence to think and labor, and then share the fruits of one’s labors to the world, without exceptions.”
The ward looked up to his guardian, his hero. “The grandeur of your heroes and mine!”
After supper, Apollo invited, “Let’s go to The Pit Stop. I go there to rest and refuel. Together with my Journal of Heroes, The Pit Stop invigorates and gives me joy.”
Apollo opened the door to The Pit Stop, but did not turn on the lights. It was a large, high-ceilinged room containing works of art. At the end of The Pit Stop were twin miniature skyscrapers that almost reached the ceiling. Their upper floors were brightly lit. Apollo and Ian stopped by the door, solemnly gazing up at the skyscrapers named Twin Beau Ideals. They were of the same mind. “The Declaration of Independence in towering steel - a free mind and ego soaring to the skies - happiness rising in architectural symphony.”
The lit top floors of the left tower spelled B I G; its lower floors were strategically lit to spell B U S I N E S S. The right tower’s uppermost lights spelled E G O; its lit lower floors radiated S E L F I S H N E S S. The Twin Beau Ideals glowed with the following:
B I G E G O
- - - - - -
B S
U E
S L
I F
N I
E S
S H
S N
E
S
S
The towers represented a mighty threat to sacrifice-glorifiers and mind-destroyers. Rejecting the hands-off, nonintervention, noninterference imperative in freedom, the subhuman attacked.
Apollo and Ian remembered the day when enemies of freedom and free enterprise destroyed the real-life BIG BUSINESS tower, and haters of equal inherent inalienable rights struck down the real-life EGO-SELFISHNESS skyscraper. The towers were owned by Uncle Sam, but made possible by the private sector.
Apollo told Ian, “Many people revolted at the September 11, 2001 destruction miss the fact that the virtues that made the Twin Beau Ideals possible have been under vicious attack for over a century. Deluge of vilification and injustice have been heaped upon free enterprise, big business, brilliant innovation, spectacular success, and self-interested pursuits of profit and happiness.”
The guardian and his ward each vowed, “What the twin towers stood for must not crumble to ruins. I pledge my life and sacred honor to see you rise again, Twin Beau Ideals, together with the good you represent: reason, liberty, coercion-free economics, science, technology, pride, and joy.”
When Apollo turned on the lights, Ian gazed at a painting of the US flag and its inscription: The USA is a self-portrait of the American people. Autograph America with FREEDOM.
CHAPTER 1
2012 - London
Starlit skies and 20°C (68°F) temperature capped a sunny London day in June. Tall, flame-haired Prince Hari arrived late evening at Buckingham Palace. The eighteen-year-old heir to the British throne joined his parents, King William and Queen Aaryanna. Not long after, his twenty-year-old sister entered the Queen Mother Den. Princess Diana’s features were harmoniously integrated. Tall, blonde, and zesty, her eyes sparkled.
The royal family watched television for a worldwide news broadcast. A new political party had won in the British general election of 2012.
“The new head of government of the United Kingdom, Mr. Ian Washington, is a year younger than William Pitt the Younger when he became Prime minister of Great Britain in 1783 at age 24. As a teenager five years ago, the new Prime Minister distinguished himself in the business world. His advocacy of economic reforms propelled him, in 2010, to a seat in the House of Commons. His eloquence as a champion of individual rights, and consequently capitalism, marked his tenure as Northumberland’s Member of Parliament.
This photograph was taken two months ago at a London charity event hosted by the former US First Daughter, Reina Roosevelt, voted the Most Eligible Bachelorette five times in a row by the World’s Best magazine. The Prime Minister and Miss Roosevelt met at Princeton University in his college days.
Mr. Washington has always refused to answer questions about his private life. He has never commented on the scoffs directed at the four-year-old plastic surgery done on his nose which resulted, but for his blond hair, into an uncanny resemblance to Prince Hari, the Crown Prince.”
In deference to the British royal family, the news report did not mention that if the king’s and queen’s firstborn were alive, he would be the spitting image of the Prime Minister.
The television screen showed a current photograph of the Prime Minister together with two old shots: one taken at age seven and the other when he graduated summa cum laude from the Princeton University in New Jersey, United States, six years ago. The old photographs showed Ian Washington with a chubby nose and an eyepatch over his left eye.
As King William and Queen Aaryanna beheld the young Prime Minister’s handsome face, they ached for their firstborn, Prince George, who vanished in 2002.
Princess Diana contemplated Ian’s face. “Mr. Washington is a year older than George.” Her intense longing was well hidden.
“The Prime Minister is left-handed while George is right-handed. I heard how he handles a gun with his left hand. He is a crack shot.” Prince Hari voiced the thoughts of the royal family. “I sometimes evade all the evidence that Mr. Washington is not George. It is a pleasure to think that George is back.”
King William called attention to the book he was rereading. “His grandmother’s novel, Freedom, is great.”
“What a marvelous book from an extraordinary woman,” the Queen enthused. “No wonder the boy she raised and home-schooled has such a brilliant mind.”
The world watched the recent speech of the young Prime Minister.
“King William has asked me to form a government and I have accepted… Beloved citizens of a great nation: William Pitt the Younger declared, ‘Necessity is the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves.’ I echo my beloved mentor, Apollo Marianto, - ‘The United Kingdom is a self-portrait of our people. Autograph our nation with FREEDOM.’ As I vowed before my revered Grandmother, I swear before you that I will forever be a dedicated advocate of equal inherent inalienable rights.…”
The world noticed. “The Declaration of Independence from a British Prime Minister with an American accent.”
19 comments:
From March to August 1991, the US Second District Court of Appeals in New York consecutively voided or reversed a slew of Giuliani convictions. Consequently, the Wall Street Journal ran an editorial headlined: “The Greed Decade Reversed”.
Despite the reversals, the victims of Giuliani’s prosecutorial excesses greatly suffered. Innocent people and businesses were destroyed.
http://books.google.com/books?id=595Kkr7pJHQC&pg=PA172&lpg=PA172&dq=%E2%80%9CThe+Greed+Decade+Reversed%E2%80%9D&source=bl&ots=pXoeZMa4Tv&sig=rUunn1zy6eLQxzsckOu99-G7YQI&hl=en&sa=X&ei=GULHUfKZFIW34APFjoHQAQ&sqi=2&ved=0CC0Q6AEwAA#v=onepage&q=%E2%80%9CThe%20Greed%20Decade%20Reversed%E2%80%9D&f=false
Main source: Daniel Fischel, a professor of law and business at the University of Chicago Law School, author of “Payback - The Conspiracy to Destroy Michael Milken and his Financial Revolution”.
Giuliani ordered the arrest of Timothy Tabor, a former arbitrageur at Kidder, Peabody & Co., on the evening of February 11, 1987. Refusing to confess and cooperate, and unable to arrange bail due to the timing of his arrest, he spent the night in jail. The head of arbitrage at Kidder, Richard Wigton, was arrested at his office the following day. He was handcuffed and led away in tears before waiting television cameras. That same day, the head of arbitrage at Goldman Sachs, Robert Freeman, was also arrested and handcuffed on the trading floor. Giuliani touted in a series of press conferences and national television appearances that the government’s case was strong. He placed Kidder under criminal investigation. Kidder made a deal which put tremendous pressure on Mr. Tabor and Mr. Wigton, but they asserted their innocence and refused to cooperate against Mr. Freeman.
Judge Robert Stanton granted the request of the defendants for a speedy trial and turned down the request of Giuliani for a continuance. Having no case, the government had no choice but to dismiss the indictment.
On December 17, 1987, fifty federal marshals carrying guns and wearing bulletproof vests raided Princeton/Newport Partners, one of the most successful securities firm. The same night, the government investigator who signed the arrest warrants against Mr. Tabor, Mr. Wigton, and Mr. Freeman, was sent to see Lisa Jones. She refused to cooperate. The government gave her immunity to compel her to testify and expected her to incriminate her superiors at Drexel. But no matter what the government threatened, she stuck to her story.
The Princeton/Newport officers refused to plead guilty and rejected any promise of leniency in exchange for cooperation.
On August 4, 1988, the government indicted Jay Regan and four other Princeton/Newport officers for violating the Racketeer Influenced and Corrupt Organizations Act, commonly referred to as RICO Act or RICO. Lisa’s boss at Drexel, Bruce Newberg, was also indicted.
Giuliani used RICO’s vague language as a potent weapon to coerce guilty pleas and punish those who refused to implicate others.
For years since 1986, the news department of the Wall Street Journal continuously reported illegal leaks from Giuliani that the government had “unearthed substantial evidence to support charges of criminal violations of securities laws by Michael Milken and Drexel Burnham Lambert Inc.” Week after week, reporters James Stewart, Daniel Hertzberg, and Laurie Cohen wrote one front-page story after another that read like prosecutorial briefs explaining to the public why Drexel and Mr. Milken were guilty of major crimes.
In April, 1988, New York Congressman John Dingell convened a congressional hearing for the sole objective of embarrassing Drexel and Mr. Milken. Dingell knew that Mr. Milken was under grand jury investigation and that his lawyer had informed the committee that he would take the Fifth Amendment and would refuse to answer questions. Dingell compelled him to appear anyway, so Mr. Milken was forced to listen to the Congressman’s tirade against junk bonds and hostile takeovers.
When Drexel’s CEO, Fred Joseph, was grilled about the “evils” of takeovers and junk bonds, he did not defend the good. Joseph opted to appease Dingell. His decision to cave was widely interpreted as a public admission of guilt.
By June of 1988, the Wall Street Journal was reporting that the Securities and Exchange Commission or SEC had decided to file a massive securities-fraud action against Drexel and Mr. Milken. Though they had been tried and convicted in the press, Drexel and Mr. Milken could not defend themselves because no charges had been filed. This repugnant government strategy was never questioned by the press. Instead, the presses, with almost no exceptions, were eager participants in the destruction of pure greatness.
In September, 1988, the SEC filed a 183-page securities-fraud suit against Drexel, Mr. Milken, and others. Judge Milton Pollack immediately ordered that Drexel would not be allowed to defend itself against the SEC’s charges by subpoenaing witnesses or documents. Drexel and Milken, once again, had no ability to respond to the charges.
With so much advance buildup from the never-ending leaks, the SEC’s suit was a big anticlimax. The SEC simply could muster no evidence that Drexel and Mr. Milken had injured anybody. The press should have been filled with stories about how the suit showed the emperor has no clothes. Instead, the Washington Post reported that the SEC had filed ‘the most sweeping securities fraud case against a major Wall Street firm in the agency’s history.’ Similarly, the New York Times reported that the government’s accusations were ‘stronger than expected.’ Others, including the Wall Street Journal, reported that the suit had exposed widespread corruption on Wall Street and it was
Giuliani demanded that Drexel plead guilty and cooperate against Mr. Milken or face a RICO indictment.
In November, 1988, Giuliani indicted Lisa Jones for perjury. Prosecutor Mark Hansen told the jury that she lied to the grand jury to conceal Drexel’s involvement in the criminal tax trades in order to protect Drexel and her comfortable lifestyle.
In December, 1988, Princeton/Newport went out of business. A law directed at mob violence and organized crime was used by a tyrant to drive a highly successful company out of business before those indicted had a chance to defend themselves in a trial.
Drexel made a bargain with the devil on December 21, 1988. Drexel agreed to plead guilty, settle the SEC lawsuit, and fire Mr. Mike Milken and his bother, Mr. Lowell Milken. Naked tyranny was unleashed! The 1988 compensation owed to the Milkens were confiscated, though at that time, they had not been accused of any crime.
RICO's Broken Commandments
by L. Gordon Crovitz (The Wall Street Journal, January 26, 1989)
http://www.marcrich.ch/mrh_publications.php?id=50
Lisa Jones was convicted on March 22, 1989. She was sentenced to serve eighteen months in prison. Also this month, the government filed a ninety-eight-count indictment against Mr. Mike Milken and his brother Lowell accusing them of racketeering, and securities, mail, and wire fraud.
The Princeton/Newport trial began in late June 1989. The trial judge, Judge Robert Carter, refused to allow the defense to offer evidence and expert testimony that the tax trades are legal based on relevant tax laws and regulations. Prosecutor Hansen told the jurors that they need not worry about technical nuances of law to convict under RICO.
Whether the defendants had in fact complied with the tax law became irrelevant in a case where they were accused of tax fraud!
Mr. Fischel also wrote: “During the trial, the Justice Department adopted a major policy change making it practically impossible to base future RICO cases on tax offenses. The accompanying statement, in a thinly disguised slap at Rudy Giuliani, made clear that a change was required to prevent overzealous prosecutors from converting routine civil tax disputes into major criminal RICO prosecutions.
On appeal, the Second Circuit threw out the convictions for the tax trades.
But, by then, the Princeton/Newport firm had been RICOed out of existence by Rudy Giuliani.
Repeat for emphasis: On appeal, the Second Circuit threw out the convictions for the tax trades. But, by then, the Princeton/Newport firm had been RICOed out of existence by Rudy Giuliani.
At the time of Lisa Jones’ trial, there had been as yet no proof that the tax trades were illegal. The Second Circuit’s reversal of the conviction of the Princeton/Newport defendants meant that Lisa Jones was prosecuted and convicted for defending tax trades that were not criminal. Unfortunately, she was unable to have her conviction overturned, though her sentence was reduced to ten months.
Lisa Jones, was convicted for covering up “crimes” that were never proven.
Lisa was a trader's assistant for Drexel Burnham Lambert Inc.. Not yet fourteen in 1978, she ran away from home in New Jersey and traveled to California. Instead of turning to crime, like drugs and prostitution, she lied about her age and was able to get hired as a bank teller in Los Angeles and rent an apartment. For the next several years, she lied about her age, education, background, and work experience in filling out credit card, job, and other applications.
In 1980, Drexel hired Lisa in a clerical position. The youngster with no formal education rose through the ranks to become a trader's assistant. Against all the odds, the teenage runaway made a success of herself. In January, 1988, she was earning over $ 100,000 a year.
On February 13, 1990, Drexel declared bankruptcy. Benjamin Stein compared the fall of Drexel, a private company with no power to coerce, with the defeat of Nazi Germany.
The ninety-eight-count indictment against the Milkens contained nothing that was not already known from the SEC’s earlier civil suit against Drexel and the extensive press leaks. The indictment was like a tyrant with no clothes, but it disclosed the Milkens’ spectacular wealth up-front. The government understood that, to the envious, the Milkens’ compensation was sufficient to prove their guilt.
Mike Milken's legendary Wall Street career began in 1969 when he joined the firm that would become Drexel Burnham Lambert. Having completed in-depth studies of financial history and debt at the University of California, Berkeley and of corporate capital structure at the Wharton School of the University of Pennsylvania, Mike concluded that the key to institutional competitive success on Wall Street was research. This was an inversion of the pyramid at most firms where sales was valued most, then trading, with research at the bottom. This belief was the foundation for his financial revolution, which helped build America's current industrial and commercial infrastructure. Simply stated, Mike believed that capital structure matters. The choice of capital structure could significantly affect the valuation of a company and the risk of investing in it.
Over two decades, Mr. Milken financed more than 3,200 companies that became engines of job creation beginning with his very first transaction, which helped assure Boeing's market leadership through the rest of the century.
Starting in Drexel's fixed-income research department, Mike eventually assumed responsibility for a wide range of financing that used more than 50 types of securities in 14 asset categories to provide customers with a full range of debt and equity services to match their capital-structure needs. By 1976, he had established unrivalled credibility and trust by building up the quality of Drexel's debt research: the financial theories he developed in the 1960s had been proven in the world's markets.
A report stated, “Mike didn't just head a lot of different departments in his work at Drexel. He and his colleagues created what is today a major part of the structure of global finance based on their financial innovations in the 1970s. This structure - now taken for granted and taught in every business school - powered job growth in America for a quarter century and is now moving around the world through the efforts of the Milken Institute.
His most important work was financing entrepreneurs who had good ideas for building companies that became significant engines of job growth. Based on his studies during the 1960s and his practical experience in the 1970s, Mike was determined to focus, first, on cash flow rather than reported earnings; and second, to consider human capital part of the balance sheet. He changed entire industries where smaller players simply did not have access to capital until he provided it. In home building, which employs millions of people directly and through subcontracting, Milken financed KB Homes, now the largest company in the industry, as well as Toll Brothers, MDC Homes, Hovnanian Enterprises, Oriole Homes, U.S. Home and many others. These are companies that literally built the American Dream.
In entertainment, MGM, News Corp., Viacom and Time Warner were all Milken-financed. In the toy industry: Toys-R-Us, Mattel, Hasbro and LeapFrog. In hospitality: Hilton, Days Inn, Holiday Inn and others. Convenience stores include 7-11 (Southland Corp.) and Circle K.
Safeway is a company with 200,000 employees in almost 1,800 stores across the U.S. and Canada. Every one of those employees can thank Milken for helping build the company that provides their paychecks. His financing was crucial to Chrysler when they most needed it to stay in business and grow in the early 1980s. The cable television industry would not be in anywhere close to four-fifths of American homes if he hadn't financed several of the major companies. Occidental Petroleum wouldn't have jobs for its 8,000 current employees without Milken.
Cellphones are in just about everyone's pocket today. The industry started in the early 1980s when Milken financed a small company called McCaw Cellular Communications.
Another way to look at the impact Mr. Milken has had is to consider just one state. Nevada, the fastest-growing state in the nation, saw its economy kick-started by Milken's financing of its gaming industry, newspapers and homebuilders. The rule of thumb in the gaming industry is that every job created within the industry creates more than three additional jobs in the local economy. By that measure, his financing of MGM Mirage, Mandalay Resorts, Harrah's Entertainment and Park Place accounts for something like 600,000 jobs.
Milken was also a pioneer in providing access to capital for minorities and women. In the early 1980s, he received hate mail and even a death threat for financing African-American entrepreneurs like Reg Lewis. Before Milken, no woman had ever headed a publicly traded company that she had not inherited; Milken was the first to finance such a company.
Some of the other companies Mr. Milken financed include: AMC Entertainment; Bally's Manufacturing; Barnes & Noble; Beatrice; Cablevision; Caesars World; Calvin Klein; Chiquita Brands Int'l; Duracell; Filene's Basement; GAF Corp.; General Host Corp.; Kay Jewelers; Knoll Int'l; MCI; Medco; Mellon Bank; Metromedia; Philadelphia Electric; Playtex; Sunshine Mining; TCI; Uniroyal Goodrich; and Telemundo.”
The full might of the US government was thrown at Mike Milken and his brother. When the FBI interviewed their ninety-two-year-old grandfather, Mike was at the breaking point.
In April 1990, Mike Milken pled guilty to six “felonies” and agreed to pay $600 million, consisting of $200 million fine and an additional $400 million for the creation of a restitution fund to compensate “victims”.
Mike Milken was a tough and formidable competitor who was despised by the Wall Street and business establishment he displaced. His success made him the envy of many, both in and out of the financial world. He was an outsider who made it big by ignoring the unspoken rule that outsiders must know their place and not rock the boat. There is no evidence that he committed any crimes, and certainly no evidence that he engaged in any conduct that had ever before been considered criminal. After the most thorough investigation of any individual’s business practices in history, the government came up with nothing. In fact, the government never established that Mr. Milken’s “crimes” were anything other than routine business practices common in the industry.
After all the leaks and accusations, the Fatico hearing exposed the government’s case as a bust even though the government had every advantage. Mr. Milken’s lawyer had demolished the government’s case but Mike was still a convicted felon awaiting sentencing. On November 21, 1990, he was sentenced by Judge Kimba Wood to serve ten years in prison.
In 1992, Mike Milken and other ex-Drexel employees settled hundreds of civil lawsuits. He paid over $1 billion to resolve claims against him though it was pure and simple legal extortion.
On August 5, 1992 Judge Wood reduced Mr. Milken’s ten-year sentence to twenty-four months. This was after her colleague, Judge Stanton, had publicly stated that one of the six felonies that Mr. Milken pleaded to was not even a crime. The Second Circuit had also reversed a slew of Rudy Giuliani’s convictions for the same conduct that Mr. Milken was accused of.
Repeat, to highlight the destruction of a man who financed 3,200+ companies: On August 5, 1992 Judge Wood reduced Mr. Milken’s ten-year sentence to twenty-four months. This was after her colleague, Judge Stanton, had publicly stated that one of the six felonies that Mr. Milken pleaded to was not even a crime. The Second Circuit had also reversed a slew of Rudy Giuliani’s convictions for the same conduct that Mr. Milken was accused of.
Glenn Ellerbe and his ilk have blood on their hands in the destruction of businessmen, those tyrannized in the past, those being gestapoed in the present and in the future.
http://www.theobjectivestandard.com/issues/2009-winter/obama-antitrust.asp
From Gena Davidovich: "Has been appalled since 1996 when I researched this case. A few years later, a friend tipped me about Milken speaking at a luncheon in Chicago. Could not make to luncheon. Came after, waited in a long line of beggars. Thanked Milken for his contribution to the world and asked for nothing. Surprise on Milken's face - priceless!"
Mike Milken, Martha Stewart, et al, have been tyrannized for undefined, flexible Insider Trading laws. Yet, Pelosi and her ilk skate.
http://www.cbsnews.com/8301-504803_162-57323518-10391709/confronting-pelosi-on-insider-trading/
Rudy's reversals: Giuliani's lost convictions. (white-collar convictions overturned)
http://business.highbeam.com/4776/article-1G1-11253724/rudy-reversals-giuliani-lost-convictions
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