-Caveat Lector-

http://opinionjournal.com/editorial/feature.html?id=65000775

REVIEW & OUTLOOK

Yes, Pardon Milken. An independent-counsel target also deserves
Presidential mercy.

Wednesday, December 13, 2000 12:01 a.m. EST

As Bill Clinton's term winds down, pardons are in the air. The
New York Times reported last week that the President is
considering pardons for a number of people, including junk-bond
king Michael Milken and Clinton scandal figures Webster Hubbell,
Susan McDougal and Archie Schaffer.

In terms of the purpose of Presidential pardons, Michael Milken's
would be the most appropriate. Presidential pardons often involve
figures whose crime and controversy are as much political as
legal. Mr. Milken, for those with long memories, somehow came to
personify the "greed decade" of the 1980s, an almost quaint
notion in retrospect.

At Drexel Burnham Lambert, Mr. Milken invented the high-yield
junk bond, today a common instrument of finance but back then
considered the plague by corporate elites. As described by
economic historian Glenn Yago: "In essence, junk bonds gave many
smaller companies access to capital, and hence to many of the
privileges, once enjoyed exclusively by our nation's largest
corporations. Junk bonds became an important agent of social and
economic change."

No doubt historians someday will set the record straight on Mr.
Milken's contribution to the explosive economic growth
experienced by the U.S. in the past 20 years. For now, he remains
the most famous figure who became engulfed in the controversial
securities prosecutions undertaken by then-U.S. attorney Rudolph
Giuliani, based on information supplied by such economically
immaterial figures as Ivan Boesky, Dennis Levine and Martin
Siegel.

Ultimately Mr. Milken pleaded guilty to six felonies, including
parking stock. Less widely absorbed is the fact that virtually
all the initial Giuliani securities convictions, such as
Princeton/Newport and GAF, were overturned by the Second Circuit.
The reversals, however, postdated the bankruptcy of Drexel
Burnham and Mr. Milken's time in prison.

Mr. Milken's philanthropic and charitable contributions are
well-chronicled, but it is interesting to note that the case for
a pardon has been carried to Mr. Clinton by a Democratic
mega-contributor named Ron Burkle. The Los Angeles Times
described Mr. Burkle as "the closest thing to a Los Angeles
Horatio Alger," a onetime supermarket box boy who became a
supermarket billionaire--with the aid of Mr. Milken's financing.

The Milken conviction carried in its wake a lifetime ban from the
securities business. It is conceivable that a pardon might allow
the removal of that ban, which in turn might release what most
piques our curiosity--exactly what sort of financial innovations
have been tumbling through Mr. Milken's restless brain through
the dot-com era.



As to the Hubbell-McDougal pardons, we reserve the right to see
any such action as a continuation of the conspiracy to obstruct
justice. That said, we would like to support a pardon for Mr.
Schaffer. A former executive with Arkansas poultry king Tyson
Foods, Mr. Schaffer found himself in the crosshairs of
independent counsel Donald Smaltz's probe into former Agriculture
Secretary Mike Espy. Mr. Espy was accused of accepting illegal
gratuities. Mr. Schaffer was convicted in 1998 of violating the
Meat Inspection Act by attempting to influence Mr. Espy with
gifts of free air travel, sports tickets, and other gratuities.
He was sentenced to one year in prison.

Mr. Espy was acquitted of all charges. Don Tyson, the chairman of
Tyson Foods, was granted immunity from prosecution in exchange
for cooperation and a guilty plea by his corporation to one count
of providing an illegal gratuity. Mr. Smaltz collected 15 other
convictions and $11 million in fines with some tough and creative
prosecutions.

Mr. Schaffer's prison sentence, mandated under federal law,
strikes us as excessive. In a rare display of unanimity,
Arkansas's entire delegation to Washington, half Republican and
half Democrat, has asked the President to pardon Mr. Schaffer, a
longtime Democratic Party activist. So has the state's Republican
Governor, Mike Huckabee. In November, he wrote Mr. Clinton saying
he was taking "the initiative in asking for this pardon because I
fully realize the political uproar some people would attempt to
create if it were viewed as a case of you granting a favor to a
political ally. As a Republican, I am making this request in the
interest of justice."

Donald Smaltz saw to it that justice was done. Now Mr. Schaffer
deserves an act of Presidential mercy.


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             Kadosh, Kadosh, Kadosh, YHVH, TZEVAOT

  FROM THE DESK OF:
                     *Michael Spitzer*  <[EMAIL PROTECTED]>
                      ~~~~~~~~~~~~~~~
  The Best Way To Destroy Enemies Is To Change Them To Friends
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