CANDIDATE FOR S.B.O.E. DISTRICT 14 Political ad paid for by Bogle for Quality Elinor Johansen, Treasurer The Herb 13,ar “Best place to cure what ails you” Explore our Oasis of Earthly Delights! extensive array of natural health and bodycare products comprehensive collection of herbs great gift ideas and much more! 200 West Mary 444-6251 M on 1-F0-5 ri 10 6 30 Sot www.theherbbancom “By being there to help them raise the money, that spoke in volumes about credibility, because you can’t run an effective campaign without being able to do television advertising:’ Wilson notes. Republican U.S. Rep. Jeb Hensarling of Athens is another former Gramm staffer, as is Republican nominee for Congress Pete Olson, who is challenging Rep. Nick Lampson for Tom DeLay’s old seat. Still, Gramm’s first foray into lobbying at the state level bombed: His efforts to sell so-called “dead peasants” insurance to the Teacher Retirement System of Texas went nowhere. Under the dead peasants scheme, UBS would have sold TRS annuities and life insurance policies on retired teachers and kept the proceeds when teachers died. His company’s proposal to sell the Texas Lottery is still alive. His protg Perry \(Aggies Gramm and Perry became close startled legislative leaders in 2007 when the governor proposed selling the lottery to private investors for between $14 billion and $20 billion. By investing that money, UBS argues, the state could earn hundreds of millions more in interest than the $1 billion earned annually now Perry first learned of the idea from Wilson, who, according to The Dallas Morning News, passed along Gramm’s interest in the subject. There are other UBS connections as well: The investment bank employs Perry’s son, Griffin, and retains former Perry spokesman Ray Sullivan as a lobbyist. In 2007, lawmakers ignored the lottery sale idea. But Lt. Gov. David Dewhurst gave interim charges to both the State Affairs and Finance committees to study the proposal. And Texas House Appropriations Chair Warren Chisum, a Republican from Pampa, has told reporters “[proponents of the sale] are already here visiting with folks to lay out their case.” Senate State Affairs Chairman Robert Duncan, the Lubbock Republican who plans to hold hearings in August, confirmed this, saying lobbyists are “circling their wagons since the issue is in play” A huge obstacle will be making the numbers workwhich, according to a recent report by campaign watchdog Texans for Public Justicewould require a huge expansion of gambling operations. UBS estimated that the Texas Lottery could be worth between $10 billion and $16 billion if per capita sales increased 2 percent a year; a 7 percent annual growth would make the lottery’s value as high as $24 billion. But the group’s report noted, “These projections assume that Texas could match the per capita sales rates of lotteries in Maryland, Georgia, and Virginia. Yet part of what drives higher sales in those states are games now prohibited in Texas. … The UBS proposal also suggests the Texas Lottery could boost sales by moving into interactive television and the Internet.” In short, the Wall Street consensus is that maximizing the value of the Texas Lottery requires an expansion of gambling into new games and new venues, and even into cyberspace. While convincing the Legislature to expand gambling is an enormous crapshoot, if anyone is connected enough to do it, it’s Gramm. No one can tout a free market ideology that happens to benefit friends and family better than he. On January 10, Gramm introduced Perry at the annual banquet of the Texas Public Policy Foundation, a conservative think tank. At first blush, Gramm’s homage might seem to be the obligatory appearance of a dutiful husband \(Gramm’s wife, friend. Granun’s remarks at Austin’s Sheraton Hotel to a friendly crowd of 500 loyal conservatives revealed just how deeply involved and powerful the former senator remains in the Perry administration and the Republican Party, both in Texas and nationwide. Pronouncing Perry the “greatest governor” of his lifetime, Gramm ticked off a list of reasons that spoke volumes about not only his subject, but himself. Predictably, he praised Perry for no new taxes and passage of the Republican redistricting bill. More revealing was his praise of Perry for seeking “private sector solutions” to government problems. Translation: cha-ching. Perry was equally effusive about Gramm when he responded to his old friend’s introduction. ‘Americans made a huge mistake in 1996:’ he declared. “I can’t fathom where we would be … had Phil Gramm led this country for eight years:’ When it comes to the economy, a McCain victory in November might make that dream come true. Patricia Kilday Hart has written about Texas politics since 1981, as a staff writer in the Capitol bureau of the Dallas Times Herald and as writer-at-large for Texas Monthly. Since 1989, she has coauthored Texas Monthly’s “Ten Best, Ten Worst Legislators.” MAY 30, 2008 THE TEXAS OBSERVER 9
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