culture, politics, commentary, criticism

Tuesday, January 28, 2003
marthaA Tale of Two Insiders. Jeffrey Toobin profiles
Martha Stewart in The New Yorker, focusing on the ImClone insider trading scandal that has engulfed her life over the last year.

To refresh your memory, here is Toobin's overview:
On December 26, 2001, Stewart's old friend Samuel Waksal, the chief executive of ImClone, learned that the Food and Drug Administration was going to reject the company's highly touted cancer drug, Erbitux. Knowing that the stock would plunge when this news became public, Waksal immediately tried to sell tens of thousands of shares of ImClone and encouraged his father and daughter to sell, too. For these actions, Waksal has pleaded guilty to insider trading, among other crimes, and faces as much as twelve years in prison when he is sentenced, in March. On December 27th, Stewart sold all of her stock in ImClone—3,928 shares, at fifty-eight dollars a share—grossing about two hundred and twenty-eight thousand dollars. The claim is that Stewart did so because she had an illegal tip.
Given her celebrity status as a purveyor of classy lifestyle porn, she was an easy mark and even her talk show host friends couldn't resist ripping into her during their monologues. But through the thicket of endless Martha-in-prison jokes, rays of light did shine:
Stewart looked cheerier when she recalled the support she's received—from Hillary Clinton, for one. "Look at her ups and downs," she said. "And she was one of the first people to call me after the article"—announcing the investigation—"and very nicely say, 'You know, you just have to hang in there. It's the process.' " Stewart continued, "First Lady, knocked to death and now senator. You know, a very important person, still. Because she's smart, she's worthy, she's great. You know, that's what I hope I'll be thought of as."
It's no secret that Stewart is a Democrat. It's also no secret, as Toobin writes, that the scandal has cost her in the vicinity of $400 million in stock losses as well as legal fees and lost business opportunities — the actual transaction cost of her $228,000 ImClone "insider" trade. (That she tried to sell her entire ImClone stake to Bristol-Myers two months earlier is rarely mentioned, although Toobin does.)

On the other hand, we have Thomas White, Secretary of the Army. This former Enron officer has a much clearer-cut case of insider trading than, well, just about anybody. If you want a summary of White's errors of judgment, here's a page courtesy of Sen. Barbara Boxer (D-CA). Be sure to view the highly revealing chart.

With all this information floating free of useful context, we decided to look at Martha Stewart's and Thomas White's alleged insider trades side by side, to see what we could infer about the treatment each case is receiving with respect to public discourse:

Insider Trades: US Military Leader vs. Ex-Caterer

  Thomas White Martha Stewart
Position Secretary of the Army CEO
Martha Stewart Omnimedia
Former Position Vice Chair
Enron Energy Services
Insider Affiliation Enron Imclone
(via friend/CEO Waksal)
Insider Trades (Alleged) 405,710
Transaction Value $12,120,827 $228,000
Number of Insider Phone Calls and Meetings 81 3
Party Affiliation Republican Democrat
Google Search String "thomas white" enron "martha stewart" imclone
Total Google Hits (1/27/03) 4,660 11,200
Smoke & Mirrors Index* $2,601 $20

*The Smoke & Mirrors Index is Skimble's measure of ill-gotten money divided by Google hits.

If I stole $1,000 and got 10 Google hits, my Smoke & Mirrors Index would be 100, equal to $100 per Google hit. If you stole $100 and got 20 Google hits, your Smoke & Mirrors Index would be 5, or $5 per Google hit. I stole more money than you but fewer people are talking about it, so the smoke and mirrors are in my favor — distracting the world from my self-enriching crime.

Bad guys score high; (relatively) good guys score low.

In other words, the higher someone's Smoke & Mirrors Index, the more they are getting away with. The less scrutiny there is about great financial crimes, the higher the S&M Index. The more scrutiny there is about smaller crimes, the lower the S&M index.

t whiteUsing the Google-based logic of the S&M Index, we see that discourse about Martha Stewart is weighted more than one hundred and thirty times over discourse about Thomas White, relative to the financial value of their alleged insider trades. Once again, disproportionate treatment of administration insiders rules the day.

Could this have anything to do with media support for an American military leader at the advent of a propagandistic war?

Could this have anything to do with keeping the stink of Enron off the administration?

Could this have anything to do with wanting to take down a strong Democratic woman?

Could this have anything to do with the general bias and/or cluelessness of the American mainstream press?

Yes. Yes. Yes. Yes.

Greatest Hits · Alternatives to First Command Financial Planning · First Command, last resort, Part 3 · Part 2 · Part 1 · Stealing $50K from a widow: Wells Real Estate · Leo Wells, REITs and divine wealth · Sex-crazed Red State teenagers · What I hate: a manifesto · Spawn of Darleen Druyun · All-American high school sex party · Why is Ken Lay smiling? · Poppy's Enron birthday party · The Saudi money laundry and the president's uncle · The sentence of Enron's John Forney · The holiness of Neil Bush's marriage · The Silence of Cheney: a poem · South Park Christians · Capitalist against Bush: Warren Buffett · Fastow childen vs. Enron children · Give your prescription money to your old boss · Neil Bush, hard-working matchmaker · Republicans against fetuses and pregnant women · Emboldened Ken Lay · Faith-based jails · Please die for me so I can skip your funeral · A brief illustrated history of the Republican Party · Nancy Victory · Soldiers become accountants · Beware the Merrill Lynch mob · Darleen Druyun's $5.7 billion surprise · First responder funding · Hoovering the country · First Command fifty percent load · Ken Lay and the Atkins diet · Halliburton WMD · Leave no CEO behind · August in Crawford · Elaine Pagels · Profitable slave labor at Halliburton · Tom Hanks + Mujahideen · Sharon & Neilsie Bush · One weekend a month, or eternity · Is the US pumping Iraqi oil to Kuwait? · Cheney's war · Seth Glickenhaus: Capitalist against Bush · Martha's blow job · Mark Belnick: Tyco Catholic nut · Cheney's deferred Halliburton compensation · Jeb sucks sugar cane · Poindexter & LifeLog · American Family Association panic · Riley Bechtel and the crony economy · The Book of Sharon (Bush) · The Art of Enron · Plunder convention · Waiting in Kuwait: Jay Garner · What's an Army private worth? · Barbara Bodine, Queen of Baghdad · Sneaky bastards at Halliburton · Golf course and barbecue military strategy · Enron at large · Recent astroturf · Cracker Chic 2 · No business like war business · Big Brother · Martha Stewart vs. Thomas White · Roger Kimball, disappointed Republican poetry fan · Cheney, Lay, Afghanistan · Terry Lynn Barton, crimes of burning · Feasting at the Cheney trough · Who would Jesus indict? · Return of the Carlyle Group · Duct tape is for little people · GOP and bad medicine · Sears Tower vs Mt Rushmore · Scared Christians · Crooked playing field · John O'Neill: The man who knew · Back to the top

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