As First Published in the September, 1999 issue

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 -Catherine Austin Fitts - Contributing Editor

Crying in the Kitchen with Jane

I went out to Tennessee's Hickory Valley today to show my cousin Jane how to get on the Internet. She had never done it before and I told her that we might be able to use it to figure out how to finance small farmers. Jane and most of my family in Tennessee are all small farmers. Like all small farmers they are facing extinction.  Jane and I wanted to look for a way to reengineer their farming business so that there might be more profit and less risk for families who were struggling so hard to stay afloat and to keep their homes and their land.

While we were setting up we caught up on Tennessee family. My stepmother Stella is in pain and feels blue. Jane's mother, Mildred, is dying it looks like. Willa Louise, our cousin, is real upset about it. Her cousin died last week. Lots of folk are sick. The drought and the market have folks worried. We went to Amazon (www.amazon.com) and e-bayŐs (www.ebay.com) web sites. We talked about the gap between the price of wheat and the price of Wheaties. A few big corporations and government are getting everything in between. We talked about how small farmers and small business people could use networks and the Internet and electronic commerce like we were seeing to vertically integrate and produce a better product at a more competitive price on a sustainable basis.

We went to Thomas, The Library of Congress web site (http://thomas.loc.gov). We looked at upcoming legislation and hearings. Then we went to the web sites for the congressman who represents Hardeman County and the two senators who represent Tennessee. They had carefully listed their important issues and legislation on the web site but, we noticed there was nothing on agriculture. Nothing at all.  Meanwhile the drought is putting many people in Hardeman County out of business. It has gotten so bad that some people no longer have any way to meet their every day expenses.

Jane and her husband Billy have about 1,000 acres in cotton this year, and some corn and soybeans. I don't know exactly how bad it will be for them, but I know that Stella (my Step mom) and her sister Marion will not get enough from their cotton to pay their taxes. Other neighbors will lose land or their farms to the bank this year. After the farmers lose their land and livelihood, the banks, the insurance companies, the merchants and the county will all be hit - hard.

The congressional representatives have been busy telling folks how much they care. But then Jane had found out that a local meeting her congressional representatives had scheduled with constituents was "by invitation only."  As Jane described the invitees it sounded to me like only campaign donors were invited. Jane asked me what was going on. I tried to tell her how things really work in Washington with campaign donations and organized crime. I told her a story from when I had been the Assistant Secretary of Housing. A large group of black ministers came to HUD and Jack Kemp, then Secretary of HUD, promised them a whole bunch of neat things. The ministers left ecstatic and one of Jack's staff said to the HUD senior staffers, "Can you believe those guys really believe that we are going to do that stuff?!"

Jane burst into tears. Then I burst into tears. So we sat in the kitchen crying because it hurt so much. Jane said to me "I know that nothing that is not decent can last." She is right. It is why I am buying a house next to hers. It is why I want Solari to be rooted here. It is why I dream of a neighborhood stock corporation and community databank here. It is why I have a red, white and blue sticker on my sports utility van and on my laptop that says, "I love cotton." It is why I feel so safe and giggle so much more here.

For all the times I tried to get people in Washington to understand that every penny was real, that decent men and women like Billy and Jane Powell cannot carry this kind of tax and regulatory overhead for decades straight, I felt, and still feel, the full pain of my failure. As I go to Joe's Cafe, and Haven of Flowers and Boliver Printing and I see how hard everyone works, and how frugal they are and how they never give up, the meaning of Mena and Waco and what is happening in our government is that much more painful for me.

I think about the comment a court-appointed trustee (a highly reputable Washington lawyer) made about costs related to a three-year investigative witch hunt conducted by the HUD Office of Inspector General against my former firm - Hamilton Securities. Hamilton had been teaching regular people to understand how money works and they had found it necessary to destroy us. To date, we estimate the cost to the federal government and you and me and Jane is $35 million and rising.  [See Edgewood Part I in the August issue and Edgewood, Part II in the October issue].  Our crimes? Under an advisory contract with HUD, we had been instrumental in saving the taxpayers over $2 billion by introducing disclosure and competition into the resolution of defaulted HUD loans through loan sales. Canceling the sales caused HUD to forgo many hundreds of millions in additional savings. One thing it did do was to guarantee that below market negotiations remained available to HUD-savvy real estate developers and landlords with strong political ties to Washington (i.e. campaign donors). When I expressed my concern about the costs to the government and HUD's insurance company, the court-appointed trustee asked, "What do you care, it is not your money?"

It is my money. It is all of our money. If no one watches the money then the covenant that holds us together in trust will break. Rule number one in Hickory Valley is that the circle go unbroken. The average person in Hardeman County, Tennessee will probably work his or her entire life to pay up to $100,000 in federal taxes. How many people will work their whole lives to pay for HUDŐs mess? More than 350 people will work their entire lives just to pay for Hamilton to be investigated. I have lost over $100 million that would now be financing small businesses in Hardeman County and places like it. When I see how hard everyone here works to make and save a penny, I still want to cry. Spit, is more like it. I know where Congress can get $15 million to fund Hardeman County's drought disaster relief payments. I say, just take it right out of the HUD pork filled budget and the behind the scenes sweetheart, workout deals that they fought so hard to protect.

When I left JaneŐs home, I drove back from Hickory Valley to Boliver. Each stretch of road has a volunteer who helps maintain it. The volunteer sign said that the stretch of road was maintained by the management company of Corrections Corporation of America (CCA.) The corn I passed was dead.  The cotton was dying. Because of the drought I could see that there had been at least one flash fire burning up a cornfield. We are worried about more fires. I headed home to read the file that Peg, Stella's cousin, gave me on CCA's two prison operations down the road in Whiteville.

Two CCA prisons hold 2,400 men behind concrete walls with tiny window slits. If the General Accounting Office 1996 report is right, taxpayers are paying approximately $154,000 for each prisoner. The state and county got the prisons approved through highly dubious methods. The rumors are that some of the government officials involved had stock options. The politicians said that the prisons would create jobs and income for the county. It seems to me that learning how to incarcerate people is not a skill set that generates sustainable exports or communities the same way that agribusiness does.

If you look at the costs and the infrastructure under construction and the impact on real estate values, you wonder what is coming next. There may have been an illegal environmental "clean up" behind the land deal. Peg says that CCA bought 250 acres and it looks from the roads the state is putting in that they are planning on many more prisons. CCA has an office in town on Market Street. I have thought more than once about seeing if I could get a part time job at the prisons. Infiltration is one way to learn about how to undo this.

But the only thing I really know to do is to bring back to the family and friends who are rooted to the land and to decency the story of how I failed in Washington in the hopes that we can solve the jigsaw puzzle together this time. Tomorrow afternoon, a group of farmerŐs wives are going to meet at the Farm Credit Bureau to talk about what we can do. Jane says I can come.

We decided that, just like Joyce Meyer says, we are going to "faith it."  I do not know what I can do, but one thing I am going to do every day is to pray for emergency drought relief payments by Thanksgiving. And I am going to pray for an agribusiness plan so that Jane and I never have to go to the federal government for one single penny ever again.

-                  C.A.F.

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