The government owed plenty to the Indians. Their problem was that they were too small to matter.
Cowboy Banks Get Big Bucks as Indians Get Little:
Ann Woolner
Commentary by Ann Woolner
Dec. 11 (Bloomberg) -- Over here you have the bazillions of U.S. bucks doled out to Wall Street’s cowboys for reckless conduct that wrecked the world’s economy.
Over there you have a $3.4 billion federal settlement with people from whom the U.S. had been essentially stealing for more than 100 years.
To seek what was owed them, American Indians spent 13 years in court where judge after judge decried the government’s gross mismanagement of their funds and “mendacity” in litigation.
And yet it took that long for the Justice Department to step up to the plate and agree to pay more than a pittance.
If the Indians had been AIG, the $3.4 billion settlement announced this week would have been many times larger. The real AIG -- insurance giant American International Group Inc. -- sopped up $180 billion in government aid after helping to create the economic havoc felt around the world.
The Indians sought no bailout, no handout when they filed suit in 1996 to claim royalties due them for oil, gas, timber, mining and grazing rights to lands allotted them under an 1887 agreement with the federal government.
The Department of Interior would collect revenue the leases generated and give it to the U.S. treasury. Some of it went back through Interior for distribution to the Indians. Some of it didn’t.
Sloppy Record-Keeping
How much money each person was owed, no one really knows, so sloppy was the record-keeping. Thousands of critical documents were lost or destroyed.
Josephine Wildgun had 7,000 acres of land the government leased out for oil drilling, Elouise Cobell, a banker friend of hers and the lead plaintiff in the case, told me a few years back.
For that, Wildgun was getting roughly $1,000 a year, or about 14.3 cents an acre, a sum obviously short, said Cobell, a member of the Blackfeet Nation who lives in Montana.
But how short? The leases covered some 56 million acres of land belonging to hundreds of thousands of people.
Eventually the U.S. came up with a total of $455.6 million. The Indians claimed they were due 100 times that.
With so many records missing, the correct figure is unknowable. Instead of seeking a reasonable settlement, the government fought the Indians in court through three presidential administrations.
Little Ground
The case grew convoluted, the accounting impossible, and the parties bitter. After 13 years, seven trials and almost two dozen published court opinions, the most recent ruling showed little ground has been gained.
The trial judge should “enforce the best accounting that Interior can provide with the resources it receives,” an appeals court said.
Oh. Why didn’t someone think of that sooner?
The ruling in July by the U.S. Circuit Court of Appeals for the District of Columbia threw out the $455.6 million verdict the trial judge had awarded.
So what was the trial judge to do? The stack of appellate rulings “do not clearly point to any exit from this complicated legal morass,” the appeals court conceded.
It had to be resolved through settlement. And it should have been resolved that way long before now.
Some two decades before the suit was filed, government investigators were issuing report after scathing report excoriating the government’s mishandling of funds, as the appeals court pointed out. The government officially acknowledged its books were a disgrace when Congress in 1994 passed the American Indian Trust Fund Management Reform Act.
Fighting Indians
Interior attempted to sort out the mess, cranking up computer programs and reorganizing staff. Still, the Indians saw little result and sued. And the government starting pouring money into a legal fight.
True, it is one thing to say the U.S. owes a huge group of people a lot of money, and another thing to figure out how much it owes whom.
Complicating the matter is the fact that so many generations have been born since the land was allotted that the number of owners of each parcel has multiplied, while the size of each interest has shrunk.
Yes, it’s a hard thing to figure out. So what?
The government didn’t need precision when it doled out $180 billion to AIG and did it in a matter of days. Whether it was wise or foolish is beside the point.
The government had no obligation to do that. Or to bail out Chrysler or General Motors. It had no legal responsibility to rescue Wall Street’s hot-shot risk-takers.
Fraction of Goldman
The $3.4 billion the Indians got amounts to roughly a third of Goldman Sachs’s government bailout. It’s little more than one-tenth the loss the government expects to suffer from its AIG bailout.
Executives balk at the idea of capping pay at $500,000 in firms that haven’t repaid the government. The Indian settlement will come to $1,500 to $2,500 for most of the beneficiaries. A few with larger tracts that generate lots of revenue will receive hundreds of thousands of dollars.
The U.S. had a legal obligation to give hundreds of thousands of Indians money promised a long, long time ago, and a fiduciary duty to keep track of it.
The government owed plenty to the Indians. Their problem was that they were too small to matter.
(Ann Woolner is a Bloomberg News columnist. The opinions expressed are her own.)
Your World Is As BIG as You Make It!!!
AI
