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Federal Appeals Court Reverses Court Decision That Barred Congress from cutting ACORN's Funds

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Despite a slew of independent investigations exonerating ACORN of misdeeds, on Friday, the U.S. Second Circuit Court of Appeals overturned federal court Judge Nina Gershon's decision that cutting off ACORN's funding punished ACORN without a trial. Gershon had ordered the United States government to restore ACORN's funds.

Congress canceled funding for the controversial group last year in the wake of highly edited, secret-video tapes, appearing to implicate the group in promoting prostitution. They were shown by Fox, CNN and on the blogosphere for several days, around the clock. ACORN employees never prepared tax returns, sign or submitted loan documents, or arranged bank loans. In most of the offices visited by the right wing activists, with their hidden camera, the ACORN staff turned them away, asked them to leave and then reported them to the police. In one case the staff took one of the activists posing as a prostitute to a counseling service for young women threatened by their pimp, the story the "prostitute" told to ACORN's staff to entrap them into saying something stupid.

The man who taped ACORN's staff, James O'Keefe, appeared to enter ACORN office dressed as a pimp, when in fact the images of O'Keefe in an outlandish pimp outfit--a top hat, cane, huge sunglasses, white fur coat--were edited in later. The cartoonish pimp costume, aimed to implant in the public's eye that ACORN's African-American staff were buffoons, cost ACORN its reputation.

ACORN had sued the federal government in November 2009 arguing that the U.S. Congress violated the Constitution by illegally targeting the group. Gershon determined that Congress singled ACORN out for punishment in the absence of any judicial or administrative process adjudicating guilt.

In her opinion, District Court Judge Gershon wrote that Congress relied on unsubstantiated accusations to cut off ACORN's funds. Republican conservatives claimed Congress had to act to protect the taxpayer's money. Gershon countered saying, Congress can't "rely on the negative results of a congressional or executive report as a rationale to impose a broad, punitive funding ban on a specific, named organization."

Last Friday, the appeals court, made up of two Republicans and a conservative Democrat, reversed a key part of the lower court ruling. George Bush Sr. considered appointing the lone Democrat, Jose Cabranes, to the Supreme Court. The court determined that Congress can punish a specific group, overruling what the district court judge had identified as an unconstitutional Bill of Attainder. "Despite that evidence of punitive intent on the part of some members of Congress . . . there is no congressional finding of guilt in this case," the three-judge panel ruled. The appeals court also sent the case back to Brooklyn federal Judge Gershon to consider ACORN's claims that its free-speech and due-process rights were violated.

Treatment of corporations accused of serious misconduct
The appellate court ruled against ACORN despite the fact that Congress gave no reason to treat ACORN differently from other contractors accused of more serious misconduct.

Congress has lavishly funded many corporations that unlike ACORN committed or have been accused of committing serious felonies. Many defense contractors have been accused of or committed crimes. Drug companies have pled guilty to criminal fraud under the federal false claims act stealing billions from the taxpayers by ripping off Medicaid and Medicare yet Congress never passed a bill debarring them from federal contracts. Blackwater, a company that had five of its employees facing murder charges in a massacre of Iraqi civilians in 2007, had received a $217 million contract to provide security in Iraq. A former Halliburton subsidiary KBR had received $80 million in contract bonuses to provide electrical wiring in Iraq, which electrocuted 16 soldiers and two contractors. Northrop Grumman had to pay a $500 million fine for getting caught nine times for contract fraud. Congress insisted on defunding ACORN, but failed to seek the same treatment for companies like Halliburton, Lockheed Martin, Northrop Grumman, Blackwater, Pfizer, and Boeing - chronic corporate lawbreakers that receive billions in federal dollars. The hypocrisy has been striking. The Congress that defunded ACORN bailed out Goldman Sachs, AIG, J. P. Morgan and other financial services corporation that lacked transparency, committed unethical or illegal acts and engaged in practices that led to the crash of our financial system.

In a statement that will surprise the leaders of the now defunct ACORN, the Appellate Judges argued. "We doubt that the direct consequences of the appropriations laws temporarily precluding ACORN from federal funds were so disproportionately severe or so inappropriate as to constitute punishment." The court ignored the fact that immediately after the New York Times and Washington Post verified the accuracy of the doctored and misleading Andrew Breitbart/Fox version of the videos, the U.S. Congress rushed to judgment and stripped federal funding from ACORN. The act of Congress directly led to the lost the support from ACORN's foundation and liberal allies. With hundreds of staff layoffs, ACORN did not have the capacity to resurrect its reputation. If ACORN had the millions of dollars and the lobbying power of Goldman Sachs, the Catholic Church, and Pfizer, it may have restored its reputation and survived. But it was a poor people's organization, unable to effectively counter the ferocious attack by the right.

More astonishingly, the decision comes after a preliminary probe by the U.S. Government Accountability Office (GAO) of ACORN found no evidence the association or related organizations mishandled the $40 million in federal money they received in recent years. GAO is the government watchdog.

ACORN's history
For 40 years ACORN has been the most effective national anti-poverty organization in the country. Since its founding in Arkansas ACORN has been criticized by business leaders, Democrats and Republicans for its direct action tactics and its populist anti-poverty agenda. It has long worked on the forefront to protect homebuyers from unjust foreclosures fueled by reckless lending practices and inadequate government regulation. In many cities and states, ACORN pioneered campaigns to increase workers wages and prevent unnecessary foreclosures by organizing homeowners and tenants, and pressuring lawmakers to enact laws protecting consumers from foreclosure scams.

As late as fall of 2009, while under severe attack and losing staff, ACORN and its sister organization ACORN Housing had helped prevent housing foreclosures for eight thousand homeowners by obtaining favorable mortgage changes. It rescinded sales, restored titles to owners, and negotiated new, affordable mortgages.

Beginning in 2008, it came under a ferocious attack by the Republican Party and Fox News for voter registration fraud and claims it violated the tax-exempt status of some of its affiliates by engaging in partisan political activities.

The attacks on ACORN were supported by certain businesses, conservative activists, and intellectuals who attacked it for ideological reasons, calling the group "socialist," "left-wing," and "opponents of the free market." Businesses that pay low wages have long opposed ACORN's efforts to raise wages for the working poor. Banks, private mortgage companies, and payday lenders have fought ACORN's campaigns to strengthen government regulations on the financial services industry on behalf of consumers.
For years conservative politicians have opposed ACORN's success at registering low-income, mostly minority voters.

What the AP left out of its report on the case.
Despite being cleared of any misdeeds by every independent and nonpartisan investigation including Congressional Research Service report (CRS), the Brooklyn District Attorney, the California Attorney General, as well as an apology by the New York Times public editor for getting the facts wrong, the weekend reporting by AP failed to mention ACORN's exoneration. The AP also failed to mention that attacks on ACORN had been going on for decades and recently became part of a broader effort by the Republicans and businesses opposed to Obama - first as a candidate, then as President - and to associate him and his liberal policy agenda with "radicals" and even "socialism."

ACORN and the Sherrod incident
When Right-Wing Republicans and Fox News first attacking ACORN, Obama distanced himself from the group, even after it was exonerated from any misdeeds by all the independent investigations. Obama's failure to defend ACORN contributed to the decline of an ally that represented thousands of families who made up Obama's base.

Obama's treatment of ACORN symbolizes how, unlike Franklin D. Roosevelt, he detached his presidency from the progressive base that helped get him elected. During the 2008 campaign, Obama had mobilized millions of people, which taught them the skills of organizing. But Obama never translated the enthusiasm of his campaign into a real grassroots movement. If anything, he shackled it by forming Organizers For America as part of the Democratic National Committee (DNC). Weakening his base contributed to his administration's fear of Glenn Beck, Fox News and the right wing echo chamber, which led to compromising his agenda and to the embarrassing firing of Shirley Sherrod.

Ironically, Ben Smith at Politico in his story of the federal court case quotes Rep. Darrell Issa (R-Calif.), ranking member of the House Oversight and Government Reform Committee, who continues espousing his phony talking points about ACORN. To emphasize how dumb the Obama strategy of throwing ACORN under the bus, the extreme Right wing Rep. Issa, who plans to go after the Obama administration if the Republicans take back the house, perhaps like he did against ACORN, cites Obama as his ally in getting ACORN. Issa says Obama agrees, "that it was inappropriate to use taxpayer dollars to fund a partisan political organization, intentionally structured as a criminal enterprise that used the guise of charity to deceive the American people while betraying very people it claimed to help." Issa adds, "Hopefully, today's ruling by the Second Circuit Court of Appeals puts an end to ACORN's misguided belief that there exists some right to taxpayer dollars to fund their overtly criminal and partisan political agenda.

Center for Constitutional Rights, which represents ACORN, will ask the Court of Appeals to reconsider.

William Quigley, CCC's legal director said, " [The] decision is deeply flawed. We are going to keep fighting alongside ACORN. We are planning to ask the US Second Circuit to reconsider the case en banc by all the judges. We cannot let Congress act like judge, jury and executioner without any hearings at all. No matter how politically unpopular and vulnerable ACORN is, we cannot allow right wing to pressure Congress into acting in unconstitutional manner."

My new book the inside story of ACORN, tells the whole truth. You can get it at Amazon or Vanderbilt University Press or in most local bookstores.
"A must read...The reader gains an understanding not only of ACORN's success in the fight for social justice, but also why its efforts to empower ordinary people are viewed with alarm and have come under attack by conservative and reactionary forces." --William Julius Wilson, Author, Harvard University

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