I want to be clear on something up front. I think hedge funds are a menace and should be outlawed. I think Goldman Sachs is a criminal conspiracy and its whole leadership should be indicted.
There are plenty of commentators, like Paul Krugman in the New York Times today and Matt Taibbi in his article in Rolling Stone, that have done great reporting on Goldman and on hedge funds.
But what we're seeing is how a really odious character named Patrick Byrne is trying to hijack this issue.
In a previous diary I described how Byrne is running a smear campaign from the headquarters of his Utah company Overstock.com, and how other bloggers at Huffington Post and elsewhere had started a "truth squad" to nail him to the wall when he goes after the media. His smear campaign against the media has been chronicled in Fortune magazine by Bethany McLean, who broke the Enron story, and by famous New York Times columnist Joe Nocera.
Byrne's constituency is mainly on the far right, and he is a regular guest on Glenn Beck and Fox News. He is leading big business's hypocritical campaign against the Obama health plan, appearing on Fox to promote the phony view that Obama would place a "tax on small business." He has been fighting hard against the Employee Free Choice Act, and dispatched his deputy Jonathan Johnson to Washington to lobby against the act. Here's a Washington Examiner article quoting Johnson ranting about the EFCA and threatening to take his business offshore:
But if a law like card check were to pass, Overstock.com would probably begin to outsource as much work as possible.
"From our experience dealing with unions is not a deal worth doing and I’d rather deal with a third party in a business relationship, rather than a union that’s in a strong arm position." (quote from his deputy Jonathan Johnson).
At the same time that Byrne has been fighting hard against the EFCA and serving on the board of the far-right Milton Friedman foundation and supporting Ron Paul for president, he has amazingly been winning fans among some bloggers on the left, including Kos diarist Andrew Perez (andrewtna), because of his posturing on Wall Street.
Perez recently wrote a Kos diary referring favorably to Byrne in his newest incarnation as a fake "journalist."
Byrne is a "journalist" like I'm a linebacker for the Dallas Cowboys.
Some context on Byrne:
He needs no introduction to readers of the Kos. Just click on the Patrick Byrne tag and you can see an unhinged rich guy with a lot of time on his hands and a low opinion of everybody else on the planet.
Some years ago he ran a company called Fechheimers. Here is an excerpt from the Kos diary describing how he treated workers there:
In September 1998, it reported on labor disputes between Byrne and workers at Fechheimer's only non-union uniform plant in San Antonio, Texas. The Chronicle said the plant was littered with dead rats, mosquitoes and other insects, and that workers - mostly Hispanic women who were paid $5.30 an hour and had no health insurance - had to bring their own toilet paper to work. Nice.
That's not all. This prince among men bought a company called Crowley Manufacturing for Fechheimers, but then the employees at Crowley voted to join the labor union UNITE. According to the Associated Press in June 1999, rather than negotiate with his employees, Byrne closed the whole Crowley plant and put 150 people out of work.
He's also the biggest money man behind school vouchers. Here is an excerpt from Pat Rusk's Kos diary on how Mr. Charm handled that:
On Election Day earlier this month, Patrick Byrne, the CEO of Overstock.com, and an ardent supporter of private school vouchers, claimed Utah’s vouchers referendum was an IQ test for Utahns – a test we presumably failed when voters rejected the plan by a 24-point margin that Tuesday.
What a tremendous insult to Utahns. We don’t need our IQs assessed by a millionaire businessmen with more of an interest in right-wing politics than in the future of our communities and schools.
When pro-voucher forces brought their voucher plan to Utah – which ranks dead last nationally in per-pupil spending and has the largest class sizes in the country – we knew they were looking not for education solutions, but rather just to push a narrow political ideology.
The guy is nuts. Here is an article in Fortune entitled, PHANTOM MENACE.
Even hardened denizens of Wall Street were shocked by a conference call that Patrick Byrne, the CEO of online retailer Overstock.com, held on Aug. 12. "I want to get something off my chest," Byrne announced. Then he launched into a rant about a "miscreants ball" in which he mentioned hedge funds, journalists, investigators, trial lawyers, the SEC, and even Eliot Spitzer. "I believe there's been a plan since we were in our teens to destroy our stock, drive it down to $6--$10 ... and even a plan for how the company would then get whacked up." The "designated final owner," who provided the "orchestration," was someone Byrne dubbed the "Sith Lord," a person he refused to identify other than to say that "he's one of the master criminals from the 1980s." And that's just the basic outline. There was more. As Mark Cuban, the billionaire investor, later wrote on his blog, "Never before in the history of Wall Street has a single conference call mentioned the following topics: miscreants, an unnamed Sith Lord he hopes the feds will bury under a prison, gay bathhouses, whether he is gay, does cocaine, both or neither, and an obligatory 'not that there is anything wrong with that,' phone taps, phone lines misdirected to Mexico, arrested reporters, payoffs, conspiracies, crooks, egomaniacs, fools, paranoia, which newspapers are shills and for who, payoffs, money laundering, his Irish temper, false identities, threats, intimidation, and private investigators. All in 61 minutes." Cuban is now short 20,000 shares of Overstock.
Today Byrne's latest con game is to run a website called "Deep Capture" to push his agenda and gain legitimacy for vouchers, union-busting and his other causes. This is a publicity vehicle for Byrne, according to Byrne himself, quoting the Society of American Business Editors and Writers. Byrne had applied for SABEW membership, and he got the following response: "In SABEW’s view, not all business blogs qualify as news publications just as all writing and editing doesn’t qualify as journalism. From its standpoint your activities and those of DeepCapture seem closer to corporate public relations, and SABEW isn’t open to PR professionals _ or of course to retail business executives."
Too bad Kos blogger Perez can't distinguish a p.r. campaign from genuine journalism, because he makes a reference to "Overstock CEO Patrick Byrne and his team of journalists at Deep Capture."
I'm with Perez and even Byrne on hedge funds. I think they're a menace. But we need to keep in mind that some disgusting people are latching on to the hate-Wall Street bandwagon. Glenn Beck is the best example. My only message is that in following this, particularly us bloggers, we have to be careful that we don't unintentionally give credibility to people who don't deserve it
Postscript: Byrne responded below. It is illuminating of this guy's "big lie" technique, which is typical of demagogues of the far right. The world is wrong and he is right. The Kos diary on his union-busting is "misinformed" and the poor soul is a victim of lies.
But who is the liar here? Notice how he begins his comment:
As several commenters have apparently sussed out, Tom's blog is a compendium of misinformation, revisionism, and bad logic, so much so that it is rather hard even to know where to start.
Here's a test of Patrick Byrne's credibility. IS he telling the truth about that? Can he tell the truth on a little itty-bitty detail like what commenters to a blog say?
The answer is no. This is a man who is such a pathological liar that he will lie about something that is right in front of you.
There were four commenters apart from Byrne and myself, at the time he made that comment. One commenter said that maybe he has a point, but made no substantive comment on my blog and certainly didn't say that my blog was a "compendium" of blah blah blah. The other three made brief comments totally unsympathetic to Byrne. One pointed out that Overstock is a Rush Limbaugh advertiser. None said anything remotely as characterized by Byrne. Read them yourself.
Patrick Byrne is amazing. He is a self-discrediting lie machine.
This is why William Wolfram began a Patrick Byrne Truth Squad, first proposed byDiane Tucker of the Huffington Post and encompassing other bloggers fed up with corporate swill merchants like Byrne twisting the truth and smearing the free press. I am proud to be part of it.