Cellular technology pushed into the US by selling off territories in a "lottery" type mechanism. The cushiest territory "lottery" win went to Chuck Hagel, who got to corner the cell phone market in Washington DC and surrounding Virginia and Maryland areas. When Hagel ran for office in 1996, controversies about how he won the lucrative cell phone lottery surfaced in the campaign; I was not able to get specifics.
In the late 1980s, Chuck Hagel went to Saudi Arabia where he got the cell phone network going. He then went to work for George H.W. Bush in a privatization effort.
Originally from Nebraska, he had been living in the Washington DC area all through the 1980s. He moved back to Nebraska to take the helm at ES&S, then called AIS. He headed the AIS Board of Directors while Bob Urosevich ran the company. (As you may recall, Urosevich then went to run Diebold Election Systems.)
Michael McCarthy, who heads McCarthy Group, was Hagels campaign finance director. When I first broke the story about Hagel and the voting machine company in 2002, Michael McCarthy's son was working in Hagel's DC office.
Hagel was not expected to win the 1996 primary, but he did, and it was such an upset that it made national news. "Can lightening strike twice?" one headline read, referring to the even more improbable prospects for Hagel winning the general. He did win. AIS/ES&S counted 80 percent of his votes.
By 2000, he was being talked about as the potential running mate for George W. Bush. He made the "short list" but Bush chose Dick Cheney instead. Hagel stated to the press in 2003 that he would consider a run for the presidency, and that was the event that caused me to call Alexander Bolton of "The Hill" to persuade a more mainstream media outlet to run a story on Hagel's voting machine company ties.
Hagel did not disclose his ownership in the voting machine company. He did disclose up to $5 million in McCarthy Group, but failed to disclose the underlying assets of McCarthy Group as required. He did not disclose that he had been CEO of the voting machine company, even though that was clearly required. He was required to list every position held during the past two years; he listed a volunteer position with the Red Cross, but failed to mention that he was CEO of the voting machine company that counted his votes. According to Bolton, Hagel's 1996 documents have been removed from the Senate Ethics Committee repository, along with the letters from the Ethics Committee asking him for proper disclosure.
Sources tell me 2003 Ethics Chairman Victor Baird took the position that Hagel failed to properly disclose the McCarthy underlying assets. Hours before Alex Bolton was set to interview him, Baird resigned. The new ethics chairperson took the official position that Hagel had done nothing wrong.
ES&S is now the largest voting machine company in the US, and certainly one of the most heavily criticized, for miscounting elections, voting machine malfunctions and questionable billing and contract procedures -- although the "most problematic" title is one that is hotly contested by all contenders.
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