437: Everything Changes
Eliot Spitzer quits after his alleged involvement in a high-class
prositution ring is revealed by a federal investigation
On Monday, business as usual in the state Capitol came to
a screeching halt. It started with a breaking news headline,
“New York Governor Eliot Spitzer implicated in prostitution
ring,” and was followed by waves of disbelief.
Sheriff of Wall Street,” the “steamroller,” “Eliot Ness,”
the man who promised “On Day One everything changes,” a man
once thought to be presidential material, was implicated in
the kind of prostitution ring he fervently prosecuted during
his two terms as New York state attorney general.
According to The New York Times, federal investigators
were tipped off to odd financial transfers from a personal
bank account of Spitzer’s. The investigators soon traced the
money trail to the Emperor’s Club, a high-price prostitution
service. Using wiretaps, investigators discovered Spitzer
having a rendezvous with a prostitute named “Kristen” the
day before Valentine’s Day this year, at the Mayflower Hotel
in Washington, D.C.
Spitzer allegedly spent tens of thousands of dollars on prostitutes
over a period of more than six years. With his wife, Silda,
by his side, Spitzer addressed the state Monday and apologized
to his family and to the public for an unidentified offense.
For two days speculation raged while Spitzer was holed up
in his Manhattan apartment, reportedly negotiating with federal
investigators to trade his position as governor for reduced
Rumors flew that his resignation was impending. Assembly Minority
Leader James Tedisco (R-Schenectady) insisted that if the
governor did not resign in 48 hours he would introduce impeachment
legislation against him. Meanwhile, Spitzer’s nemesis, Senate
Majority Leader Joseph Bruno (R-Brunswick), remained poised,
giving his condolences to the Spitzer family.
Finally, Wednesday morning, during a two-minute press conference,
Spitzer announced that he would tender his resignation as
governor effective Monday, March 17, the short lag coming
at the request of Lt. Gov. David Paterson, who will serve
out Spitzer’s term as governor.
look at my time as governor with a sense of what might have
been,” said Spitzer. “I am deeply sorry that I did not live
up to what is expected of me.”
With Paterson as governor, Bruno, who will become acting lieutenant
governor, will have executive power when Paterson is out of
Senate Minority Leader Malcolm Smith (D-Queens) said, “The
governor’s resignation is appropriate. Eliot Spitzer has to
take care of his family now and we must move forward and continue
to govern and serve the 19 million people of this state.”
U.S. Congresswoman Kirsten Gillibrand (D-Greenport), who earlier
had called for Spitzer’s resignation if the allegations were
true, said in a statement, “The governor made the right decision
for New York. I have every confidence in Governor Patterson
[sic] and look forward to working with him on the important
challenges we face. I will work to assist him in his transition
in any way I can.”
While Spitzer’s fate has become a little clearer, the fate
of the party he leaves behind is not. Although Spitzer’s first
year in office was almost universally seen as a failure, his
effort to win Democratic control of the state Senate looked
to be paying off. The effect of Spitzer’s scandal on state
Democrats has yet to be seen.
Politicians on both sides of the aisle say that they have
great hope for Paterson’s governorship. During his time as
a state legislator, Paterson developed a friendly relationship
with Bruno. It is expected that Paterson will work quickly
to come to a budget agreement and then begin replacing Spitzer
administration officials with his own staff. Insiders say
hope remains for state Democrats because Paterson is known
to excel in politics where Spitzer failed.
The Troy Record quoted Bruno as saying: “We are going
to partner with the lieutenant governor when he becomes governor.
David has always been very open with me, very forthright.
. . . I look forward to a positive, productive relationship.”
Sins Have Been Upgraded
was the “decreased sense of sin” in today’s society,
the decreasing confessions, and the implications
of globalization that brought the Vatican to announce
seven new deadly sins this week. No longer just
the outdated “gluttony, envy, sloth,” etc., now
the list will include abortion, obscene riches,
social injustice, drug dealing, genetic engineering,
pedophilia and polluting. The change also came
from a survey held for Lenten priests, which showed
that 60 percent of Italian Catholics no longer
attend confession. The punishment for these sins
is still the same—your soul will still burn in
hell if you die in a state of sin without confessing.
Is It All Going?
the eye of a coming, or perhaps present, economic
recession, the Federal Reserve is lending $200
billion in cash to financially burdened banks.
Lending Treasury securities and increasing currency
swap lines, the Fed reported it will coordinate
with central financial institutions in other countries,
including the Bank of Canada, the Bank of England,
the Swiss National Bank, and others. The lending
will be handled over a 28-day term, rather than
overnight, and will be delegated by a weekly auction
process. Since last week’s initial short-term
loans, $160 billion was made available through
six auctions. This would be the first recession
since 2001, and already the Labor Department reported
has 63,000 jobs were cut last month alone.
It Clean, 10 More Years
population in China is still a bit out of hand,
said Zhang Weiqing, minister of the National Population
and Family Planning Commission, Monday in an interview
with China Daily. Because the anticipated
birth surge isn’t expected to end for another
decade, the country’s one-child-per-couple policy
will stick for at least that long. China is already
the highest population country in the world, with
more than 1.3 billion citizens, and more than
200 million people will enter child-bearing age
over the next 10 years. Those combined facts made
it clear to the commission that any premature
moves to up the limit could prove disastrous.
Albany County Legislature holds off on tax legislation that
would help fund convention center
This week Albany County legislators tabled a bill that would
renew a 3-percent hotel tax, part of which would be used to
secure bonds for the proposed Albany Convention Center. Some
legislators said they feel as though they did not have enough
information about the wording of the bill or the future of
funding of the convention center to approve the tax. The bill
has been sent to the Audit and Finance Committee. The room
tax will be discontinued by the end of the year if the county
Legislature does not reauthorize it. The state Legislature
also has to approve the bill.
Confusion arose over the fact that the phrase “hotel project
fund” was added to the bill, which had some legislators concerned
the county could be allocating taxes on other hotel rooms
in the county to fund the Sheraton Hotel in the convention
Albany Convention Center Authority executive director Duncan
Stewart told the Times Union that the funds would go
to repay construction costs and not go to the operators of
Legislators also were concerned with the fact that a sunset
provision has been eliminated, meaning that they will never
again be able to vote on the renewal of the tax. Albany County
Legislator Chris Higgins (D-District 6) said it concerns him
that the tax could be allocated to the ACCA even if the convention
center does not come to fruition.
Furthermore, Higgins said he is concerned that there is no
representative from the county Legislature on the ACCA board.
Legislators reportedly are working on arranging a meeting
with the larger players in the authority so that they can
have a better understanding of the bill they are voting on.
Higgins said he and a number of his colleagues are concerned
about where the rest of the funding for the convention center
will come from, as it is fairly clear that there is no room
in the state budget to provide funding.
the increase in costs and uncertainty of this project, it
is absolutely necessary to take a step back and evaluate whether
continued county funding of this project is in the best interests
of the taxpayers of Albany County,” said Higgins.
Albany Common Councilman Dominick Calsolaro (D-Ward 1) said
he has talked to legislators about adding wording to the legislation
that would state that the county is liable only for the 1-percent
bed tax. “I thought maybe we need to put in to the legislation
that the county would only be liable up to whatever amount
the bed tax brings in and nothing more,” said Calsolaro.
Meanwhile, Calsolaro said he thinks it is important that the
ACCA takes into account rising interest rates on the bond
market when considering how much debt service is going to
be attached to the building of the center. Calsolaro said
he would like to see more information about the kinds of bonds
the ACCA is considering.
think we need an estimate from Duncan Stewart about what it
would cost if they do those bonds,” said Calsolaro. “We really
need to have the info. Right now there is no sunset for the
bed tax. I suggest maybe we want to have a sunset clause put
in for when the bonds are finished. So if we have 20-year
bonds it will sunset in 20 years. There is no reason to keep
the tax indefinitely.”
Stars Come Out in Troy
TV celebrities—and apparent students of NXIVM—visit the Capital
Region with hopes of starting a business
Last week, Troy Mayor Harry Tutunjian got a break from his
regular humdrum duties to entertain, at least for a little
while, celebrity. Allison Mack of TV’s Smallville and
Nicki Clyne of Battlestar Galactica were in Troy, scoping
out the quaint downtown scene, visiting the shops and going
out for dinner, and they popped in for a quick visit with
the befuddled mayor.
Mack and Clyne have said that they were interested in starting
a business, and curious about the community’s youth scene,
said Jeff Buell, Troy’s director of public information.
Why Troy? Why the Capital Region?
Because, according to multiple sources, Clyne and Mack are
students of Executive Success Programs, or ESP, which is the
educational wing of NXIVM, and have been for at least a year.
Mack’s co-star, Kristin Kreuk, has been connected to the organization
NXIVM, a Capital Region-based organization, purports to offer
courses in “ethics, critical thinking and entrepreneurship.”
It has been criticized by many of its former members as destructive
The head of NXIVM, Keith Raniere, started his “human potential
training” business in 1998, after his first business, Consumers
Buyline Inc., a multimillion-dollar discount buyers club,
was shut down after 25 state and federal investigations. It
was alleged at the time that CBI was a pyramid scheme, and
Raniere was forced to pay New York state roughly $50,000.
According to former insiders, Raniere is referred to by followers
Clyne and Mack’s apparent goal is to start a business, the
details of which are somewhat unclear, but according to sources,
it would be geared toward helping young entrepreneurs and
college students start their own businesses. “We really want
to be known for our parties,” Mack told a source, who asked
to remain anonymous.
Sources also said the business could entail a membership fee.
As a member, students would have access to discounted items,
such as travel or computers. According to sources, the business
would have direct ties to NXIVM, something that NXIVM president
Nancy Salzman flatly denied.
In an e-mail to Metroland, Salzman wrote, “To say their
business is affiliated with NXIUM [sic] is quite a stretch,
but if you must it would also mean, Enron, Worldcom, Krispy
Kreme and BNI, Black Entertainment TV and a number of different
countries are NXIVM affiliated. . . . The business to which
you refer is just another business started by one of our past
or present 8,000 participants who took one of our courses
in ethics, critical thinking and entrepreneurship. It is our
intent to help people start businesses if they want to and
be more joyful and prosperous in their lives, I guess we’re
doing a good job.”
Raniere is obviously doing is gearing up for the college crowd,”
said Rick Ross, a leading cult deprogrammer and controversial
critic of NXIVM. “The demographic that has been the most lucrative,
the most fruitful for cults is 18 to 26.”
Young people with substantial discretionary funds who are
alone for the first time in their lives, are an ideal target,
he said. He pointed to the survey that Clyne and Mack have
linked to from their official Web sites as an example of Raniere’s
attempts to gather data on this demographic. Nearly each page
of the online survey features a picture of Clyne, Mack, or
Kreuk. The survey is hosted at etho lutions.com, a domain
registered to Karen Unterreiner, a longtime associate of Raniere’s
from his days with CBI.
Raniere, according to Ross, is not allowed, by law, to be
involved in a discount buyer’s club, due to the collapse of
The survey is specifically geared toward college students.
It asks more than a dozen questions regarding their purchasing,
studying, and recreational habits. After a round of these
questions, the survey moves on to more unusual questions,
such as, “Would you swallow a glass of your own vomit for
$100?” The questions continue along in this vein, increasing
the hypothetical monetary payout, and also the grossness factor:
“What if it was dog vomit?”
experience with Hollywood people and cults, they are really
easy to grab,” said Ross. “A lot easier than you would imagine.
They are so vulnerable and emotionally needy. What kind of
person wants to be an actor in the first place? They need
to be loved, adored, and the center of attention. It’s like
shooting fish in a barrel.”
Clyne and Mack declined to comment for this article.
loose ends this week-