Banana Republicans

3 October 2005 By Edward Hadas Follow @edwardhadas

Markets are ignoring a sharp increase in the fiscal deficit and the increasing number of senior Republicans who are under a cloud. But regimes that aren t committed to good financial practices normally cause damage.

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The US Republican party has been hit in the past two months by a series of financial embarrassments, including:

* Tom DeLay has temporarily stood down as speaker of the House of Representatives after being indicted in Texas for violations of the state campaign finance law. DeLay has been admonished three times by the House ethics committee.

* The SEC has launched an investigation into possible insider trading by Senate majority leader Bill Frist. The senator has admitted that he suggested to trustees of the blind trust which holds his shares in the company that they should sell some of them shortly before HCA issued a profit warning.

* Lester Crawford resigned as commissioner of the Food and Drug Administration (FDA) just two months after his appointment was confirmed. He cited age. But press reports and comments by his wife suggested a possible financial conflict of interest.

* David Safavian resigned as the federal government's chief procurement officer. He has since been indicted in relation to accusations of lying about his dealings with Abramoff.

* Michael Brown resigned as head of the Federal Emergency Management Agency (Fema) amid accusations he had exaggerated his professional credentials, and criticism of his handling the aftermath of Hurricane Katrina.

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