Gasoline prices are rising, which means it's time for a new round of hysterical media stories about that dastardly oil industry, its obscene profits, and its nefarious ways.
Now the media are at it again, but with a different target. They're turned their guns on Texas oilman T. Boone Pickens, whose energy hedge funds have delivered staggeringly successful results for their investors in recent years. (Full disclosure, and sorry to steal the thunder from left-wing conspiracy buffs: Pickens supports the Media Research Center. Not only that, but he's also a friend, though this friend didn't have the Abramoffian common decency to compensate me for writing this.)
In February, the New York Times and CNN reported breathlessly that Pickens had made a $165 million tax-deductible gift to Oklahoma State University (OSU). So what's so scandalous about that? Well, there was more to the story, you see. After receiving the gift, OSU turned around and reinvested it all right back in Pickens' company. How perfectly quaint! If not illegal, certainly it was unethical. No, sleazy. The man took a monster tax write-off with this gift only to have the money put right back into his investment company. They don't call them the greedy rich for nothing. Some friends you've got, Bozell.
Except for a couple of things. What neither "news" outlet saw fit to report was that by the time these stories emerged, just months after the re-investment, Boone Pickens' funds had already generated a cool $20-plus million additional profit for OSU. (That was February, remember.) I understand the number has now topped $40 million!.
Yeah, but what did Pickens make on the deal between management and performance fees? Buried in the Times story in the 12th paragraph, when most people have stopped reading, and ignored altogether by CNN, was this little nugget of information: Pickens had waived all fees and commissions on that reinvestment. In other words, Pickens didn't earn a penny for the work he did increasing the value of his gift to his alma mater to over $200 million.
And get this: The $165 million gifted by Pickens constitutes the largest gift ever received by Oklahoma State University. The fees and commissions waived by Pickens represent the second largest gift ever to that school.
And for that he was attacked by the New York Times and CNN.
Now comes "ABC World New Tonight" with another hit piece on Pickens introducing yet another variable. In their "eye-opening" (their words) pre-Tax Day report on April 11, anchor Elizabeth Vargas and "investigative reporter" Brian Ross charged Pickens' OSU gift was nothing more than an "audacious" abuse of a "loophole" in last year's Katrina Relief Act that allowed full deductions for charitable giving primarily to encourage assistance to hurricane victims. As a result, they charged, because of this "apparently legal" maneuver, "a taxpayer could deduct enough to effectively have a gross income of zero." Moreover, they claimed, Pickens was violating at least the spirit of the law. "None of Pickens' $165 million went to Katrina victims," Ross reported, "unless they were going to golfers in Oklahoma," While Ross dripped his sarcasm, visuals showed people lazily playing that sport at a country club.
How many deliberate distortions, inaccuracies, and omissions of fact can we count here?
Distortion: The gift to OSU was directed to a wide variety of the university's sports programs, including a new stadium -- not golf.
Inaccuracy: There's nothing "apparently" legal about what Pickens did. It's completely legal, and completely ethical. But don't take my word for it. My colleague Amy Menefee found this poignant analysis of the tax code revision from Vargas' and Ross' co-worker, ABC financial contributor Mellody Hobson on Feb. 23: "Well, this is actually a terrific thing. After Katrina, the government really wanted to spur contributions to help the victims, so … they said that 100 percent of any contributions you made, regardless if it was Katrina-related or not, would be tax-deductible."
Omission: Far from finding a loophole to deliver a gross income of zero, Pickens paid over $200 million in corporate taxes last year. That fact was known by ABC when it ran this hit piece.
But what about Katrina victims? Isn't that the underlying point? A big gift to a university in Oklahoma is nice, but what about helping those desperately needy folks so decimated by those horrific hurricanes? Where are the conservatives when we need humanitarian relief?
Here's another little bit of information known to ABC but kept from its viewers, purposely withheld in order to tell this story of corporate corruption.
Guess who was the single largest individual donor in the United States of America, at $7 million, to help Katrina victims directly? Yup. Boone Pickens. And for good measure, his wife contributed hundreds of thousands of dollars more.
The only scandal in these scandal stories is the stories themselves.