The hottest potato in Vermont

Our political elites are still involved in the unedifying spectacle of desperately trying to create distance between themselves and a former best buddy. Unedifying, and beggaring belief.

The best bud, of course, is alleged EB-5 scamster Bill Stenger, who still denies  — also beggaring belief — that he knew nothing about the misuse of $200 million in investor funds, and that it was all the dark-skinned flatlander’s fault. Pretty much everyone in Vermont politics has cozied up to Stenger in the past, and anyone in a position to bestow favors did so on a regular basis. Democrats, Republicans, even Bernie. (Who has thoroughly ducked the issue, his endless narrative about the evils of corporate influence notwithstanding.)

At the head of the “run away from Bill” parade is none other than our esteemed Governor, Peter Shumlin. One of his worst attributes as a leader is his extreme reluctance to admit he screwed up, even in the face of overwhelming evidence. And that makes his frantic positioning in this case all the more incredible; you can almost hear him claiming that Vermont’s handling of Stenger was a “nothing-burger.”

Yeah, that phrase will be on his political headstone, and it’s largely his own fault. He’d be better off just acknowledging unpleasant realities and accepting responsibility. Because as the state’s chief executive, he is uniquely responsible.

You wouldn’t know that from hearing him talk to Seven Days’ Paul Heintz.

“Obviously, we can all sit here and say, you know, ‘Who should have done what, when, differently?'” the governor said, adding that his administration had done “a lot of inner searching” lately. “But I think the answer is that, you know, at the heart of it, there’s a certain amount of trust in the partnerships that we have with the private sector in government.”

Um, no. That’s exactly wrong.

These kinds of deals HAVE to be regulated. They HAVE to have measurable goals. The government MUST keep an eye on the henhouse. If you’re putting “a certain amount of trust” in Bill Stenger or GlobalFoundries or Keurig Green Mountain or even Ben and Jerry’s, you’re setting yourself up for a fall.

Was this Shumlin’s attitude toward CGI, the contractor that screwed up the state health exchange? Maybe it was. And maybe that’s why Vermont Health Connect was an endless, slow-rolling botch.

Back to Stengerville.

Shumlin and his people are patting themselves on the back for transferring oversight from the obviously inadequate Agency of Commerce and Community Development to the Department of Financial Regulation — in December 2014, more than six years after the fraudulent scheme began. And nearly four years after Jay Peak’s controller, John Carpenter, left the company because Stenger was giving him vague answers and withholding financial information from him. And three years after a company that expedites the EB-5 process cut ties with the Stenger/Quiros operation because things weren’t adding up.

And a year after the Securities and Exchange Commission opened its investigation into the scheme.

So don’t tell me you were out in front of this scandal when you took action in December 2014. (Conveniently enough, I should point out, just after the 2014 election was in the books. Didn’t want a scandal interfering with the campaign, did we?)

Shumlin’s been a-spinnin’, but the front-runner for Most Outrageous Claim is none other than Our Eternal General.

Attorney General Bill Sorrell said last Thursday that, but for Donegan’s work, not only might the state not have caught on, but the federal charges may not have materialized either.

Oh, puh-leeze. The feds were on this case long before Sorrell or Shumlin or Pat Moulton awoke from their slumbers. As is so often the case, Sorrell’s got his head wedged firmly up his own fundament. And thinks it smells nice.

One final question for this post. The Burlington Free Press:

In September 2015, Donegan told her team to “take stock and see what we have.”

“We said, ‘This is what we’ve got: We’ve got fraud,'” Donegan said.

Okay. September, October, November, December, January, February, March, and half of April go by before the “fraud” is revealed. And that, only after the SEC raided Jay Peak.

So if state officials were sure there was fraud seven months ago, why did they keep their lips zipped?

“We had an ongoing project. It was best for all involved, including investors, to have that project finished,” Shumlin said. “A half-finished hotel does no good.”

Oh, I see. You kept it quiet in hopes that Bill Stenger could pull a rabbit out of his hat and get Q Burke done before the whole thing went kerblooey.

Nice of the Governor to make that decision on behalf of the investors. Somehow I think they would have liked to know ASAP that they were in bed with a fraudster.

This kind of sunny denial and blame-shifting will not stand. We already know enough to see through the Governor’s efforts to burnish his own image. It’s only going to get worse as more information comes out.

Peter Shumlin has done a lot of good as Governor. But the shorthand version of his tenure, in the end, is likely to boil down to four things: Tropical Storm Irene, Vermont Health Connect, Jerry Dodge, and Bill Stenger.

Only one of those four is a positive.

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3 thoughts on “The hottest potato in Vermont

  1. Jason Loomis

    Pat Moulton has bounced around state government like a pinball. It’s part of the reason for Shumlin’s monumental failures. He moved people into positions they really aren’t qualified for, and taxpayers pay the price. Shumlin continues to be the emperor who wears no clothes. If only those bears would have been faster.

    Reply
    1. John S. Walters Post author

      It’s also a problem with ACCD’s mission. It is supposed to foster business development, and it’s responsible for overseeing the state’s grant programs. This conflict has been addressed, belatedly, with EB-5, but not with other state business incentives. Like the Enterprise Fund, for example.

      Reply
  2. chuck gregory

    Hey! We are doing what we can to make Vermont a more “business-friendly” state! If we don’t back off this investigation, the Wall Street Journal and Chamber of Commerce are not going to change their opinion of Vermont.

    Reply

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