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* From a press release…
“Before a friendly audience behind closed doors in March, Ty Fahner claimed credit for driving down the state’s bond rating–and thereby raising costs to all taxpayers. Now, under growing public scrutiny, he says that wasn’t true.
“Fahner’s delayed attempt to deny that those efforts took place results in more questions than answers. If there’s nothing to hide, why is he trying to backtrack now? Why would he mislead the public in the first place?
“Did members of the Civic Committee speak to the ratings agencies — as Fahner clearly stated initially? If so, what transpired? Did any Civic Committee members profit from these actions? How did the role of Fahner’s law firm as state bond counsel and the role of many Civic Committee members as bond underwriters impact their efforts to lobby to reduce the state’s rating?
“Ultimately, which story should the public believe? Every Illinoisan deserves to know what really happened. We urge elected officials and the news media to demand answers to these lingering questions, uncover what occurred, and examine whether formal consequences are warranted.”
Investigation needed or no?
posted by Rich Miller
Wednesday, Aug 7, 13 @ 9:21 am
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Yes. Questions need to be answered under oath under penalty of perjury.
Comment by The Captain Wednesday, Aug 7, 13 @ 9:26 am
Investigate
Comment by Wndycty Wednesday, Aug 7, 13 @ 9:27 am
Well the questions are…
Who would investigate and what is the ‘crime’ lets say they did talk to the rating agencies to try and get the rating lowered is that a crime. Might not be cool but is it a crime, if an entity talks to a rating agency to get a better rating is that a crime?
Not saying some media entity should be looking into this…
Comment by OneMan Wednesday, Aug 7, 13 @ 9:28 am
No. If they did talk to the rating agencies that is deplorable. However, there isn’t anything illegal about it. No crime or anything else has been committed. There isn’t anything to investigate.
Comment by Demoralized Wednesday, Aug 7, 13 @ 9:30 am
I looked at the video again and Ty’s nose had grown really long.
There should be an investigation, and the initial investigation should by a legislative committee. What is most needed is oversight of the state’s bond process.
Do we have legislative leadership that will authorize such an investigation? (Are unpaid legislators more likely to take it seriously?)
Comment by Anonymour Wednesday, Aug 7, 13 @ 9:30 am
Yes
And I still like my idea the other day … if any crime is found, the guilty parties should be ordered to buy a special issue of $100B of zero interest zero fee 50 year Illinois pension bonds. That would be justice served …
Comment by RNUG Wednesday, Aug 7, 13 @ 9:31 am
How is this any different than a merchant reporting a slow pay or past due account to a credit reporting agency that ultimatly lowers a persons credit score ?
Comment by Janitor Wednesday, Aug 7, 13 @ 9:33 am
I didn’t think an investigation was needed prior to Fahner’s “clarification”. I mean, as angry as it made me, I realized it was just a bunch of old, rich, Lexus-driving, golf-playing, “clubhouse dinner” eating rich guys pretending that they’re more important than they are. It’s pretty much GOP status quo.
However, Fahner’s clarification should be a red flag. He wouldn’t have clarified if he knew it was nothing or didn’t matter. He clarified because he was concerned he did something wrong. Or concerned that other people might think he did something wrong. The key, though, is the idea of “wrong.” If it was nothing, there was no need for his bizarre rich guy clarification. But he clarified because it was something — something that could potentially (I assume) get some folks in serious trouble.
I, for one, would like to know Rauner’s part in all of this. I know he’s denied it, but given the CC’s track record of “mispeaking”, I’m not convinced the denial means much. His “no” is probably contingent on a fairly strict contextual parsing of the question(s) that preceded it. My assumption, at least.
Comment by Frenchie Mendoza Wednesday, Aug 7, 13 @ 9:34 am
Absolutely
Comment by CharlieKratos Wednesday, Aug 7, 13 @ 9:35 am
Of course an investigation is needed. An investigation is not an indictment. If, as Ty now says, he “misspoke”, then no harm, no foul. If the Civics are truely innocent of the allegations, they should be demanding an investigation to clear their good names. That they aren’t, I think, is telling. In addition, the state ought to conduct an investigation on it’s own to determine whether a breach of fiduciary duty has occurred on the part of its bond counsel.
On the surface, since Illinois Bond rating is much lower than the example Rich has previously highlighted, that of the province of Ontario having a higher debt per capita than Illinois, but a much higher bond rating, that would seem to support Ty’s initial statements regarding the Civic Committee members having contacted the ratings agencies, demanding that the rating be lowered, and that those calls had a significant impact.
Comment by PublicServant Wednesday, Aug 7, 13 @ 9:36 am
What crime? The only thing I can think of is was there an opportunity to short any Illinois bond issue and did anyone connected with Fahner or the Civic Committee do just that while they were trying to convince ratings agencies to make Illinois’s borrowing more expensive.
Comment by Nonplussed Wednesday, Aug 7, 13 @ 9:36 am
I would think the Metra mess needs investigation first.
Comment by Pat C Wednesday, Aug 7, 13 @ 9:37 am
Yes, please.
Ty has ZERO credibility. What would it hurt, Ty, to check out that wonderful yarn of Power, Influence, Deceit, Self-Interest… I mean, his Firm only had the “best interest of Illinois in mind” as “Ty’s Tale” tells of ruining Illinois’ credit rating..,
Yeah, and I hope Mayer, Brown and Ty fully cooperate, along with the entire STAFF of the Civic Committee, the Civic Committee’s members, and anyone involved who could “exonerate” Ty…
You know, I just want to “clear” Ty’s name, so shouldn’t Ty want this sunshine too?
Comment by Oswego Willy Wednesday, Aug 7, 13 @ 9:38 am
Yes, there should be an investigation. He is essentially admitting that it would have been wrong had it occurred before he “misspoke”. Do you think we would have needed a clarification if they were not worried about something? An interesting question would be for Rauner as to whether or not he would support or oppose these types of tactics to achieve pension reform.
Comment by Obama's Puppy Wednesday, Aug 7, 13 @ 9:39 am
Yes.
If they didn’t do anything wrong, then they have nothing to worry about….right?
Comment by Ready To Get Out Wednesday, Aug 7, 13 @ 9:39 am
Yes, he is essentially admitting that it is wrong if these phone calls were made. They are worried about something. Someone ask Rauner if he supports or opposes this kind of tactic to achieve pension reform.
Comment by Obama's Puppy Wednesday, Aug 7, 13 @ 9:41 am
BTW — a big shout out to the technology known as “video”.
I mean, between Fahner’s confusion — which, I suspect, will ultimately silence the CC for a long time — and Romney’s unabashed bashing of nearly half the country he apparently wanted to represent — these rich guy fetes are becoming the quite the fertile ground for quick stripping the phony public veneer these guys tend to hide behind.
I assume in Fahner’s case a tearful “re-clarification” and an appeal to an eternally forgiving God is soon in the cards.
Comment by Frenchie Mendoza Wednesday, Aug 7, 13 @ 9:43 am
This is EXACTLY the same as Metragate.
Both involved legal (til-proven-otherwise), albeit ethically questionable, exercise of free speech.
Metragate has seen half the board members resign, several editorials from throughout the state and lengthy, well-covered legislative hearings.
CEOgate has seen … A dim-witted, easily proven wrong “I didn’t say what I said” denial and some insider baseball on CapFax and a union-backed online only news site.
… Better investigate CEOgate too. Seems to me the Dems are in charge of the committees that would schedule the investigation. They could even share a room for the Metragate investigation.
Comment by A. Nonymous Wednesday, Aug 7, 13 @ 9:46 am
Investigation? Absolutely, yes! Fahner’s comments weren’t minced - they were clear and what he did should be investigated for the good of Illinois.
Comment by Anonimo Wednesday, Aug 7, 13 @ 9:46 am
For me - the investigation needs to be of the ratings agency and what factors contributed to Illinois’ ratings. The state pays these people a lot of money to provide an unbiased determination, and if this has been influenced by external factors, that causes me concern as a taxpayer.
On a related front, there needs to be an investigation to see whether the firms represented on the Civic Committee have profited from the downgrade, if it’s established that they did - in fact - have communications with the ratings agencies.
Comment by Name Withheld Wednesday, Aug 7, 13 @ 9:48 am
=However, there isn’t anything illegal about it.=
Does it have to be illegal to investigate? If you have a business organization - one that enjoys access to the board rooms of huge corporations in Illinois and beyond - that is championing the lowering of a particular state’s bond rating for political purposes, it should be exposed. And the way to do that is to investigate.
The Civic Committee’s action may have taken money from my pocket if the rating agencies acted on their overture.
Comment by Knome Sane Wednesday, Aug 7, 13 @ 9:51 am
I’ve said it before and I’ll say it again…
A lower credit rating negatively impacts the tax paying citizens of the state of Illinois.
That’s a whole lot of plaintiffs in a lawsuit against anyone who might’ve tried to jawbone the ratings agencies to push our rating down.
Comment by A. Nonymous Wednesday, Aug 7, 13 @ 9:54 am
So, Ty, were you lying then… Or are you lying now?
Comment by Cards Wednesday, Aug 7, 13 @ 9:55 am
So, conspiring to secretly affect bond ratings was not intended and was actually just a misstatement?
How would we ever know for sure? Sure looks like an inquiry under oath to folks at the credit rating houses might produce some answers.Even if they are only circumstantial, they might be very embarrassing and possibly criminal. Most lawyers surely realize that, right Ty?
Comment by Rufus D Doofus Wednesday, Aug 7, 13 @ 10:00 am
Yes. If Ty hadn’t bragged about the committee’s intervention and the state’s actual bond rating wasn’t lower than comparable states/other locals (I think someone pointed out Ottawa’s debt load was similar to Illinois but they were rated several notches higher than us) there wouldn’t be anything to look into.
and A. Nonymous @9:46- the fact that this has just been an insider baseball and We Are One story speaks volumes about the agendas of the various media watchdogs in (what’s left of) the print newspaper business in this state. The fact that they continue to ignore this serious issue kinds blows away the whole “liberal lamestream media bias” garbage that some folks love to spout all the time. Shouldn’t a bunch of commie liberal reporters be all over this kind of 1%er’s abuse of the public?
Comment by Roadiepig Wednesday, Aug 7, 13 @ 10:00 am
Interesting question….
I suppose the answer is no, it doesn’t have to be illegal, but then I guess my follow-up question is do you just want to look at these guys or do you want to look at anyone who attempted to influence the ratings of bonds? Also what impact will investigating people for trying to influence a bond rating have on the sale of future bonds?
Comment by OneMan Wednesday, Aug 7, 13 @ 10:01 am
Whether or not a criminal act occurred, it is a significant matter of public policy and needs to be investigated. The state credit rating has a very significant impact on the finances of the state, and if those ratings are based on anything other than unbiased, objective analysis we need to know about it. There is also the matter of conflict of interest for a major law firm that is raking in big bucks from its bond work with the state.
Comment by Eugene Wednesday, Aug 7, 13 @ 10:02 am
By all means, investigate.
Prosecute instead of allowing “stepping down” when wrongdoing is uncovered.
Accountability is so lacking in Illinois,
it should be no surprise why the State is failing.
Politics at its worst!
Comment by OLD BRASS Wednesday, Aug 7, 13 @ 10:06 am
This absolutely should be investigated. It appears that the Civic Committee profited both monetarily and politically. This would certainly violate State ethics laws and should invalidate contracts with Ty’s law firm.
Comment by Say it ain't so! Wednesday, Aug 7, 13 @ 10:06 am
Investigation and prosecution are different. An investigation should be done by a legislative committee, in public, under oath, so that a clear understanding of what happened — and what may need to be changed — is developed.
Comment by Anonymour Wednesday, Aug 7, 13 @ 10:08 am
Yes, investigate! At the very least the ARDC and/or the Inspector General’s office should look into it and let the chips fall where they may.
Comment by Pacman Wednesday, Aug 7, 13 @ 10:10 am
- PublicServant - Wednesday, Aug 7, 13 @ 9:36 am:
My thought exactly - only better scripted!!!
I would like a gander at the Fiduciary Clause of the Bond Underwriting contract.
Comment by WhoKnew Wednesday, Aug 7, 13 @ 10:11 am
A very important question is raised by Janitor - Wednesday, Aug 7, 13 @ 9:33 am:. This is what most citizens who are not steeped in the details would want to know. His straightforward metaphor of the merchant and his customer deserves an answer.
Perhaps some cynical political columnist could write a column?
Comment by Cod Wednesday, Aug 7, 13 @ 10:12 am
Fahner emails Miller and basically says “move along, nothing more to see here.” He’s gotta be kidding.
Absolutely investigate.
Comment by too obvious Wednesday, Aug 7, 13 @ 10:13 am
To the question posed I think the answer should be yes.
It will be interesting to see this all plays out. Some very big fish on the line here who have the money and contacts to stretch this out for years. People tend to get bored and forget and things get settled quietly.
Ty’s message to Rich Imho almost seemed to say, Look son the people I represent have way more stroke than you do so go bother someone else.
Comment by Bemused Wednesday, Aug 7, 13 @ 10:14 am
= do you just want to look at these guys or do you want to look at anyone who attempted to influence the ratings of bonds? =
Let me phrase it this way: If the bond rating agencies are required to be neutral and unbiased, why are they yielding to pressure from a business organization that has a political axe to grind? I think this argument is more along the lines of “why did the ratings agencies capitulate (to outside influence)?”
Comment by Knome Sane Wednesday, Aug 7, 13 @ 10:18 am
Yes, INVESTIGATE!!! We Are One is correct. No need to say more.
Comment by WOW Wednesday, Aug 7, 13 @ 10:22 am
Absolutely. Only an investigation by law enforcement will determine whether a crime actually occurred.
Who spoke with whom at what time and what was the substance of those communications? How did those communications influence the agencies’ ratings of Illinois bonds, if at all? And if they did influence the ratings, did the individuals communicating with the rating agencies benefit financially - directly or indirectly - from the change in rating?
Was this effort coordinated, and did it include multiple individuals operating toward the same goal, as Ty appeared to suggest in his remarks?
Comment by Raymond Wednesday, Aug 7, 13 @ 10:23 am
Invewstigation is a MUST
Ask Ty if he is all lawyered up now when he calls back
Let’s ask if the other Civic Committee swells who are in the trading biz ( i.e. hedge fund hustlers, etc) traded on the information — such as shorting IL bonds or options
The insider stuff is clearly
Comment by CircularFiringSquad Wednesday, Aug 7, 13 @ 10:24 am
Not even close. Distasteful free speech? Yes. A crime? No. Have yet to see one iota of proof from We Are One, or anyone else for that fact, anything remotely illegal took place here.
Comment by Anonymous Wednesday, Aug 7, 13 @ 10:24 am
I’d like to see an investigation if for no other reason than to watch Fahner squirm as he walks back his story. Maybe then the Tribune will find some space to actually cover the issue.
Comment by 47th Ward Wednesday, Aug 7, 13 @ 10:26 am
I believe there should be an investigation, due to a potential conflict of interest.
Comment by Grandson of Man Wednesday, Aug 7, 13 @ 10:27 am
Yes he should be investigated but he won’t be because don’t you know Masters of the Universe are above the law?
Comment by Sir Reel Wednesday, Aug 7, 13 @ 10:28 am
Investigate. The “urgency” aspect of our 50 year old pension issue is the ratings game and here sits our former AG pushing the wrong way. I’ve felt for some time that the pension busters gotta do it quick ’cause an improving economy and tier 2 are undermining their argument.
Comment by countryboy Wednesday, Aug 7, 13 @ 10:29 am
“How is this any different than a merchant reporting a slow pay or past due account to a credit reporting agency that ultimatly lowers a persons credit score?”
Illinois has budgets, debt, etc. that are all out in the open. Illinois reports its own debts and its own slow paying. But the average Joe doesn’t report that; businesses report that. Everything that the credit agencies need to make an accurate credit rating is public knowledge.
Comment by Timmeh Wednesday, Aug 7, 13 @ 10:36 am
If Ty Fahner’s law firm as state bond counsel, falls under the (5 ILCS 430/) State Officials and Employees Ethics Act, pursuant to a contract and whose employment duties are subject to the direction and control of the State with regard to the material details of how the work is to be performed, it appears that it is totally possible that the firm may have violated the Act by attempting to influence the decisions of the bond rating agencies. If nothing else, the Ethics Board should investigate this!
Comment by Say it ain't so! Wednesday, Aug 7, 13 @ 10:36 am
Just stop letting Ty sit at the table in all these discussions…..
Comment by Liberty First Wednesday, Aug 7, 13 @ 10:40 am
No, Ty Fahner already has enough “stink” on him to last a good while. The court of public opinion is often more cruel than a committee or even a courtroom. There would be a huge fight over who investigates and the costs would be out of control in no time. And in the end we would learn what? The State has been spiraling downward on credit rating as it is. If he said something, how did that change the trajectory of what was inevitable anyway? Irresponsible? Yes. Everyone already thinks that. The one thing that would change my mind is if some “jackals” made money on this. If there’s evidence of that, investigate, prosecute and punish away!
Comment by A guy... Wednesday, Aug 7, 13 @ 10:41 am
Can anyone rationalize why Rich is among the few media people interested in this very bizarre story?
Isn’t bizarre behavior by well-known people and organizations usually considered “news?”
It seems as though the Tribune finds everything about pensions front-page worthy. Except this.
I wonder why?
Comment by wt Wednesday, Aug 7, 13 @ 10:42 am
Investigate the free speech of private citizens or a private orgranization, even if we find it repulsive?
Absolutely not.
Unless, of course, we are to investigate We Are One and every other public or private entity who has called, emailed, met with, or otherwise attempted to influence a ratings agency in their own attempt at “market manipulation” by improving the bond ratings of Illinois.
Comment by Formerly Known As... Wednesday, Aug 7, 13 @ 10:57 am
Yes, if only it was about a partners loyalty to the client. (I think Mayer Brown should be withdrawing from representing the State of illinois as well). It’s obviously more than that though, so YES!
Comment by roger Wednesday, Aug 7, 13 @ 10:57 am
It is good to see that the We Are One coalition agrees that free speech is still protected under the Constitution.
If they truly believed there were any wrongdoing, they would have reported their concerns to the SEC by now instead of just issuing more press releases bleating for an “investigation” of their political opponents.
How do we know they haven’t?
Because the press release from We Are One about them doing so would have been released 5 seconds after they did so.
Anyone see that one yet? Or are we still waiting?
Comment by Formerly Known As... Wednesday, Aug 7, 13 @ 11:04 am
Investigate. We need to know who if anyone, profited off pushing their political agenda. Especially, if the firm that is taking state money for bonds (who Ty is a partner of) is actively trying to raise the rates for the state. Imagine if your realtor actively tried to bargain a higher price for you to pay so their commission would be higher. ..
Comment by iThink Wednesday, Aug 7, 13 @ 11:10 am
Again, investigation and prosecution are different things. Congress investigates many matters that are not criminal in nature — these include oversight investigations and investigations designed to see if a change in law is necessary.
If we had an active, real General Assembly, a committee would want to know the details of the state’s bond ratings, including whether they had been manipulated by private parties for potential personal gain, and whether they had been manipulated by persons affiliated with state contractors in a manner that was inconsistent with the letter or spirit of their state contracts. That could lead to better oversight of state contracts. It could lead to changes in contracting language or the law.
If something turned up that merited further consideration, it could lead to a regulatory or even criminal investigation. But there is no requirement that any law have been broken for a legislative committee to take a look and see if Illinois’ bond system is functioning appropriately.
Comment by Anonymour Wednesday, Aug 7, 13 @ 11:14 am
“Investigation needed or no?”
Yes. The people of Illinois deserve to know more about the actions of this shady operator.
– MrJM
Comment by MrJM Wednesday, Aug 7, 13 @ 11:15 am
@ a guy; “The one thing that would change my mind is if some “jackals” made money on this. If there’s evidence of that, investigate, prosecute and punish away!” Can’t find the evidence if you don’t investigate.
Comment by Pacman Wednesday, Aug 7, 13 @ 11:16 am
@ Cards
== So, Ty, were you lying then… Or are you lying now? ==
Exactly. Investigate the Liar.
Ty’s “free” speech could be very costly to taxpayers, and very profitable to him et al.
Comment by Oozlefinch Wednesday, Aug 7, 13 @ 11:19 am
Knome, you beat me to it. First these people who thinks there needs to be a clear crime committed for there to be an investigation are just plain unrealistic. The police investigate a suspicious death to determine whether any criminal act(s) in relation to the death occurred. If, as a result of the investigation, any criminal wrongdoing has been found to have occurred, then charges are brought. Same as investigating statements that, on the surface, seem to indicate the potential breach of fiduciary duty at the very least.
Comment by PublicServant Wednesday, Aug 7, 13 @ 11:24 am
I think “investigation” is a word that can mean a lot of different things. It can mean the entire FBI looking into a heist. It can also mean one guy looking through some files.
At the very least, I’m hoping that there’s some guy out there looking through files.
Comment by Timmeh Wednesday, Aug 7, 13 @ 11:28 am
Why bother wasting money on an investigation. It’s a fool’s errand, and nothing will come of it. Consider:
1)Yes, it’s fairly obvious it would be a crime if those bond servicing heads on CC financially benefitted from the lowered rating. But Ty Fahner said he “misspoke” (read: lied) at the luncheon. How do get from the Point A (lowered rating) to Point B (higher bond costs) without Ty?
2) Exactly how many of those Wall Street executives who tanked our economy in 2008 went to jail?
Ty was told to say he misspoke to protect those on the CC whose hands got caught in the cookie jar extracting extra fees for their bond services. He was only to happy to comply.
Comment by Truth teller Wednesday, Aug 7, 13 @ 11:48 am
==Yes. The people of Illinois deserve to know more about the actions of this shady operator.==
I’d settle for Fahner ‘fessing up and then work on a way to prevent this from happening again.
Comment by Wensicia Wednesday, Aug 7, 13 @ 11:50 am
Shouldn’t the SEC be investigating the rating agencies? If they actually moved the needle based on suggestions from corporate individuals as opposed to actual, I don’t know, research, seems as bad as accepting corporate individuals suggestions on how to rate mortgage backed securities. And how did that work out?
Comment by bobby dylan Wednesday, Aug 7, 13 @ 11:58 am
Some VERY important questions remain to be clarified by We Are One: How broad an investigation are they seeking? Whom, exactly, is it they would have us “investigate”?
Ty Fahner?
The entire Civic Committee?
Including U.S. Commerce Secretary Penny Pritzker? And Mayor Rahm Emanuel?
Including those members who have publicly and affirmatively stated they have not contaced any ratings agencies and have nothing to do with this?
Do we just investigate the Civic Committee members We Are One suspects may have contacted ratings agencies? How do they narrow that suspicion down? On what basis?
Do we just investigate the Civic Committee members We Are One suspects may have contacted ratings agencies and may have potentially stood to gain financially from a downgrade?
Or do we investigate the entire Commercial Club? Including those members on their Civic Committee and the members they may have spoken to and colluded with?
Current members only? Or former members as well? How many years prior?
Comment by Formerly Known As... Wednesday, Aug 7, 13 @ 12:24 pm
Waste of time. Such an ‘investigation’ would be great fodder for all the political ideologues, but the real deal to pay attention to is the ‘move’ that is currently happening by 10 year Treasuries.
That’s going to effect just about everything. And if any pension deal here in IL requires additional bonding, well, they better be reviewing their numbers.
Secondly, better ask yourself a question. Any so-called ‘investigation’, while being great fun for the political ideologues pursuing it, can easily turn into a major (insurmountable) obstacle for reaching any kind of pension reform deal. Where would such an ‘investigation’ take us?
If you blow up the chances for any type of pension reform deal crafted by local/state political leaders, then any ‘reforms’ to pensions are likely to be put into the tender and loving hands of outside entities (like credit rating agencies, or the courts). Or we could end up muddling on and going sideways just like we have been for the last few years.
IMO, better to lower the temperature than to crank up the heat.
Comment by Judgment Day Wednesday, Aug 7, 13 @ 12:42 pm
Don’t know what you got until you look, it’s a chicken or egg thing.
Comment by Pacman Wednesday, Aug 7, 13 @ 12:48 pm
I think legislative hearings are in order.
Why wouldn’t you want to ask your bond counsel if they were working against your interests. when one of the named partners said that he was? Same for those who seek state bond business in “negotiated” (read: pinstripe patronage) deals.
I think it’s pretty clear, though, that no one wants to tangle with the Big Money guys.
Comment by wordslinger Wednesday, Aug 7, 13 @ 12:49 pm
Yes,
what Word said.
Comment by Ghost Wednesday, Aug 7, 13 @ 12:53 pm
Yes, there should be an investigation of the Civic Committee to see if any laws have been broken. Since it appears that this business group has the ears of Illinois elected officials(I still remember Ty Fahner with Madigan and Cross on the capitol steps during a pension news conference)I think there should be an independent investigation
Also, it might be helpful to have the SEC take a look at the rating agencies
Comment by Earl Shumaker Wednesday, Aug 7, 13 @ 12:59 pm
Yes, and I think Mayer Brown has an obligation to their client for full disclosure of what happened here.
Comment by purple ty Wednesday, Aug 7, 13 @ 1:15 pm
Wordslinger, as usual, you have hit the nail on the head!
Comment by kerfuffle Wednesday, Aug 7, 13 @ 1:18 pm
Word beat me to it. Nobody in Illinois is going to take on the big money/clout heavy folks.
Maybe we can get the feds to take a look.
The best we can take from this is that Fahner is now a known liar - what he calls misspoke.
Comment by Norseman Wednesday, Aug 7, 13 @ 1:44 pm
Illinois can always use another investigation.
Comment by Anon Wednesday, Aug 7, 13 @ 1:52 pm
Why don’t we investigate why people have moved from merely rooting against Illinois to actively moving to destroy it?
Comment by Knome Sane Wednesday, Aug 7, 13 @ 1:56 pm
Wordslinger “says no one wants to tangle with the Big Money guys”. Probably true, what legislator would want to bite the hands that fill their campaign troffer.
Add to that, when someone openly tells everyone, as Ty did in that richly revealing video, that he is from Detroit’s East Side (infamous as where Jimmy Hoffa and his “associates” operated back in the day), it’s a bit intimidating. It’s certainly not a crime nor evidence of anything, but I wouldn’t want to be the ratings agency that rats on him.
Even if he later says he said so but mispoke on that statement as well.
Comment by PrivateCitizen2 Wednesday, Aug 7, 13 @ 1:57 pm
I assume that elected officials and their staffs stay tuned to this blog. The question is will they have the courage and backbone to look into this issue? Or will they just look the other way
and say, “Oh, this is Illinois politics as usual.”
Comment by Earl Shumaker Wednesday, Aug 7, 13 @ 2:16 pm
Yes—Investigate. It may not prove anything was legally wrong but it will probably reveal something interesting.
Comment by Belle Wednesday, Aug 7, 13 @ 2:45 pm
What Word said.
Investigation need not be limited to whether criminal conduct has occurred. A different question is whether the State of Illinois should hire new bond counsel and release their old bond counsel.
Also, investigation is needed to ascertain how much of the State’s unfunded pension liabilities arose from excessive management fees (and perhaps even market manipulation) rather than overpaying those greedy elementary school teachers.
Comment by Bill White Wednesday, Aug 7, 13 @ 2:51 pm
I’d add a legislative oversight committee should invite the lead state analysts from the rating agencies for a little chin-wag, too.
The state, by law, is required to pay those guys hundreds of thousands a pop to rate debt. It’s not too much to ask for them to come in and answer a few questions on their process.
Comment by wordslinger Wednesday, Aug 7, 13 @ 4:24 pm
And under oath hopefully, Word.
Comment by PublicServant Wednesday, Aug 7, 13 @ 4:43 pm
This is a very sensitive area for ratings agencies, since they dropped the ball big time, and were contributing partners in creating our disastrous financial bubble — because they clearly let their ratings be swayed by the demands of their biggest customers. If they haven’t cleaned house, and let any pressure from Civic Committee members change any opinions or ratings, then we’ve got a problem.
Talking to rating agencies is common, but it’s usually to prop up your own bond or offering rating, not to tear someone else’s down. We need to know if they succeeded even a little bit. It’s the rating agencies that should be questioned.
Comment by walkinfool Wednesday, Aug 7, 13 @ 4:49 pm
Nothing wrong with having a legislative inquiry.
All involved should have nothing to hide.
Comment by Arthur Andersen Wednesday, Aug 7, 13 @ 4:49 pm
Go ahead and investigate, but do you really think you are going to get any honest truthful answers from any of these people?
Comment by Mama Wednesday, Aug 7, 13 @ 5:23 pm
Nobody expects the Spanish Inquisition!
Comment by 47th Ward Wednesday, Aug 7, 13 @ 5:24 pm
I’m perplexed about the lack of interest in this story from other media outlets, the GA and the Quinn administration.
The pension issue is red hot. There’s a new story or editorial every day. Rating downgrades always get big play. Everyone jabbers on and on about both issues constantly.
Why the crickets, then, on these directly related developments?:
– the former attorney general of Illinois publicly bragged at the Union League Club that he and executives of some of Illinois biggest businesses secretly lobbied to lower the state’s credit rating to advance their proposal to cut pensions of government workers.==
That’s not a story? That’s not an issue?
– the former attorney general of Illinois, who secretly lobbied credit rating agencies to raise interest rates on the state’s debt to force pension cuts for government workers, is a partner at the law firm with a $2 million state contract for bond counsel work. –
That’s not a story? That’s not an issue?
– A coalition of labor groups representing one million Illinois workers is calling for an investigation of the efforts of a former Illinois attorney general and big business group to lower the state’s credit rating in order to force pension cuts to government workers.–
That’s not a story? That’s not an issue?
– A former Illinois attorney general denied that he did what he said he did.–
That’s a very funny story. Everyone likes a funny story.
I know a lot of media outlets don’t like to be late to the party, and sometimes ignore things they should have picked up on before.
But this is good stuff, a lot of drama and backroom-dealing. Pensions and rating downgrades are big stories; they’re not going away. They impact everyone in the wallet, one way or the other.
I don’t have a tinfoil hat on, but what gives? There’s no heavy lifting; the story’s already written, just pick it up. It’s not like media outlets don’t lift stories off Cap Fax all the time.
Same with the deafening silence from the Quinn administration and the GA — what gives?
Everyone scared of the big, bad Civic Committee? Hoping for cushy jobs with the Fortune 500 after public service?
For crying out loud, all three — media, GA and administration — claim, ad nauseum, to represent the public interest.
Well, represent! And start asking some basic, no-brainer questions in service of the public interest.
Comment by wordslinger Wednesday, Aug 7, 13 @ 5:46 pm
–Go ahead and investigate, but do you really think you are going to get any honest truthful answers from any of these people?–
It’s standard investigative technique to ask a lot of questions you already know the answer to. A lie is much more revealing than the truth.
Comment by wordslinger Wednesday, Aug 7, 13 @ 6:05 pm
Wordslinger, many of us are perplexed by the silence of government officials and the media on this matter as well Could it be that the corporate media and government leaders are cronies with members of the Civic Committee?
Comment by Earl Shumaker Wednesday, Aug 7, 13 @ 6:13 pm
Someone please tell me what law may have been broken, and then I will tell you if there should be an investigation.
Comment by Just Me Wednesday, Aug 7, 13 @ 7:02 pm
Maybe if they could identify any conceivable broken law or ethical breach?
To my knowledge no one has yet though.
Comment by Will Caskey Wednesday, Aug 7, 13 @ 7:43 pm
Although Mr Fahner may have had an error in judgement by trying to adversely affect the State’s bond ratings he appeared to be doing it out of frustration with the pension crisis which he thought could ruin the State and not personal gain for himself or his company.
That may be why the story doesn’t have legs. That was, of course, before he recanted everything. I imagine the old boys told him he had to fix it and that was the best he could come up with.
Comment by Bobio Wednesday, Aug 7, 13 @ 8:06 pm
I knew it was a waste of time, but I thought I would search the Trib site to see if I could get any hits on this story. No luck, but I did find something everyone should be aware of. TCBY is expanding in the Chicago area. At least we know they are covering the important news!
Comment by Ready To Get Out Wednesday, Aug 7, 13 @ 9:00 pm
Bobio
……no personal gain for himself and his company.”
And you know this how? Are you privy to information that the rest of us don’t have access to? Are you even familiar with the term or concept “conflict of interest” or the terms and conditions required when acting as an agent or representative of the State of Illinois? I suspect not.
Comment by Old and In The Way Wednesday, Aug 7, 13 @ 9:39 pm
Call the Feds.
Comment by Anon Wednesday, Aug 7, 13 @ 11:04 pm
“And you know this how? Are you privy to information that the rest of us don’t have access to?”
No Old, I just actually listened to his speech.
Comment by Bobio Thursday, Aug 8, 13 @ 12:12 am
–Although Mr Fahner may have had an error in judgement by trying to adversely affect the State’s bond ratings he appeared to be doing it out of frustration with the pension crisis which he thought could ruin the State and not personal gain for himself or his company.–
So he sought to stick it to state taxpayers in order to save them? That’s civic leadership.
I’m convinced that the long game of these guys is heading off any move to a progressive personal income tax.
Most of the Civic Committee crews’ companies pay nothing in state income taxes, so they’re not on the hook for any pension liability.
But the Big Dogs pulling down seven figures would sure like to see that 3% rate back. And they want nothing to do with the 7.75% rate in Wisconsin or the 8.98% rate in Iowa.
Comment by wordslinger Thursday, Aug 8, 13 @ 12:47 am
When was the last time an investigation related to Illinois government resulted in nothing?
Comment by wt Thursday, Aug 8, 13 @ 1:12 am