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Friends in High Places: John Edwards & the Fortress Investment Hedge Fund

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In the past two elections for president, two candidates have made poverty a central theme of their campaign, Dennis Kucinich and John Edwards. With poverty at the core of these campaigns, it seems inevitable that these men would be forced to address subprime loans and how discriminatory and predatory they have become. The very nature of debt buying businesses (as highlighted in the startling documentary Maxed Out, which goes from talking about credit card debt to how victims of credit card debt find more woes after allowing debt buyers to buy off their debt) is crude and vile to the core. Interestingly, these two men have chosen two different ways of handling the issue of subprime lending with one, Dennis Kucinich, holding a series of hearings on “urban America” that have involved special attention being given to subprime loans, and the other, John Edwards, choosing to work for a hedge fund so that he could “learn more about poverty.”

This is not new news, yet however, it is important to look at Edwards’ involvement up to this moment. It is necessary to compare it to another candidate to show how Edwards could have really done something for poor and middle class Americans. Based on his history, this will allow us to ask if John Edwards is really capable of being a beacon of hope for the poor and middle class if elected.

John Edwards Goes to Work for Fortress

Edwards was hired as a part-time senior adviser by Fortress by October of 2005. His job was to provide “support in developing investment opportunities worldwide and strategic advice on global economic issues.” Like Dan Quayle (Cerberus Capital Management) and Rudy Giuliani (Giuliani Capital Advisors), he joined a group of former politicians who had left politics to become “dealmakers.”

Edwards claims that in 2005 he went to work for them “mainly in order to learn about the relationships between financial markets and poverty.” But if that is the case, why not just take a class? To, those who ask this question, he responded to an AP reporter saying, “That’s true,” and adding, “making money was a good thing, too,” while maintaining that he went work for Fortress to “primarily learn.”

Edwards’ advising has made Fortress one of the biggest if not the biggest campaign contributors to his campaign for president. At the time of his hiring, Fortress had given through it’s employee’s political action committee approximately $143,000 to Democratic candidates running for Congress and the White House. Since then, the numbers have noticeably risen as Fortress’ contribution to Edwards of $4,000 is nearly forty times what it was before Edwards took the job in 2005. (*This does not include contributions made by the Fortress PAC.)

Hurricane Katrina Hit in August 2005

It’s not so much that John Edwards took the job, but what he did or didn’t know before taking the job that makes me wonder why he chose to. I have no reason to believe that he didn’t want to run for president again in 2008. Therefore, a move to work for Fortress had to be carefully calculated. Even if he wasn’t running for president, Edwards wasn’t going to be retiring anytime soon?

But, in fact he was going to run, and this was mentioned by the Washington Post in an article published in September 2005, one month before taking the job with Fortress. In the article, Edwards was quoted attacking the issue of poverty and even offering policy initiatives to help the victims regroup in the aftermath of the hurricane.

Edwards “criticized Bush for suspending a law requiring federal contractors along the Gulf Coast to pay prevailing wages on reconstruction projects:”

"I might have missed something, but I don't think the president ever talked about putting a cap on the salaries of the CEOs of Halliburton and the other companies . . . who are getting all these contracts," he said in a speech at the Center for American Progress, a liberal think tank. "This president, who never met an earmark he wouldn't approve or a millionaire's tax cut he wouldn't promote, decided to slash wages for the least of us and the most vulnerable."

Edwards was also quoted using “the metaphor of the flooded levees in New Orleans to describe what he called society's inadequate efforts to bolster the poor.”

How could he have offered policy iniatives that were "comprehensive" if he did not know the full involvement of predatory and subprime lenders in Louisiana?

If this is when Edwards began to run for the presidency in 2008, why would he jeopardize his political future by not asking about Fortress’ involvement unless he was ignorant to the fact that Fortress had subprime lenders involved in the area Katrina hit?

After ACORN, a group he has worked with on poverty since Katrina, published this report on subprime Lending one month after Katrina titled “Subprime Katrina,” how could he have ignored this and not talked with Fortress about their involvement with loans in the area hit by Katrina?

Maybe he intended to take a chance that he would be found ignorant because working for Fortress would be one easy way to make money to finance a future presidential campaign. And maybe, Edwards was counting on his personality and reputation to offset the possibility that people would suspect something fishy had gone on between Fortress and Edwards.

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Kevin Gosztola is a writer and curator of Firedoglake's blog The Dissenter, a blog covering civil liberties in the age of technology. He is an editor for OpEdNews.com and a former intern and videographer for The Nation Magazine.And, he's the (more...)
 
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It appears David Swanson had already covered this ... by Kevin Gosztola on Thursday, Jan 10, 2008 at 10:11:02 AM
I've worked for a number of firms that have a ... by Steven Leser on Thursday, Jan 10, 2008 at 12:47:26 PM
It takes a huge amount of money to run for Preside... by Susan Nelsen on Thursday, Jan 10, 2008 at 1:23:36 PM
or is that rhetorical?And are you asking me to cho... by Kevin Gosztola on Thursday, Jan 10, 2008 at 2:52:46 PM
Edwards' keeps touting that he doesn't tak... by Deb S on Thursday, Jan 10, 2008 at 10:43:44 PM
Do you think John Edwards understands subprime loa... by Kevin Gosztola on Thursday, Jan 10, 2008 at 2:51:30 PM
Susan Nelsen said:"It takes a huge amount of money... by Susan Rapp on Thursday, Jan 10, 2008 at 6:44:41 PM