The "Complexities" of American Law

With the full unveiling of the concept of corporations are "people" (as Mitt Romney happily repeats on the presidential nomination trail), the Citizens United case settled by the Supreme Court has demonstrated the wondefully "complex" nature of American law.

Here is a bit from a post by UC Berkeley economist Brad DeLong expatiating on the subtleties:

Justinian: How does this Fourteenth Amendment read?

Edward Coke: Like this:

Section. 1. All persons born or naturalized in the United States and subject to the jurisdiction thereof, are citizens.... No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Section. 2. Representatives shall be apportioned... counting the whole number of persons in each State....

Justinian: So if you have more corporations in your state, you get more representatives in the legislature?

John of Salisbury: No, no, no! "Persons" in Section 2 refers only to human beings...

Edward Coke: And "persons" at the start of Section 1 refers only to human beings...

John of Salisbury: Only "persons" at the end of Section 1 refers to legal persons, i.e. corporations, as well as human beings...

If the US were consistent in its "law" then there would be a rush by the ultra-rich to incorporate all kinds of "companies", millions of companies, so that at the next election the ballot boxes could be happily stuffed with all kinds of votes from the corporate "persons" acting under the full weight of the law as laid down by the Fourteenth Amendment. If ever the poor organized themselves, it would simply require a renewed effort to incorporate some one "instant corporations" to help the "people" of America to keep the 99% in their place. Because... as the Supreme Court has affirmed, corporations are "people" too!

Excusing Rogue Cops

Here is a nice post on The Agitator blog citing a new low in police "professionalism" in the US:

Maybe there’s a legitimate law enforcement reason to strip a man naked, strap him to a chair, tie a “spit hood” around his mouth, put a hood over his head (see video at the link), and douse him with pepper spray until he dies. That’s what sheriff’s deputies in Lee County, Florida did to 62-year-old Nick Christie two-and-a-half years ago.


I certainly can’t think of any such legitimate reason. But Lee County State’s Attorney Stephen Russell apparently can. Because he cleared the deputies involved of any wrongdoing.

Christie’s family just filed a lawsuit.

The cop's crime is obvious. But the more insidious crime is the State Attorney who looked but could find no "crime" in this brutal case.

Justice in America

Here is a bit from a post by Robert Reich in his blog:

— American Airlines uses bankruptcy to ward off debtors and renegotiate labor contracts. Donald Trump’s businesses go bankrupt without impinging on Trump’s own personal fortune. But the law won’t allow you to use personal bankruptcy to renegotiate your home mortgage.

— If you run a giant bank that defrauds millions of small investors of their life savings, the bank might pay a small fine but you won’t go to prison. Not a single top Wall Street executive has been prosecuted for Wall Street’s mega-fraud. But if you sell an ounce of marijuana you could be put away for a long time.

The above is the key issue in the 99% versus 1% fight now going on in the US. There is a "justice" for the poor and a "justice" for the rich. There is a government for the rich and the poor have no voice in government. In fact the US Supreme Court has made it official with its Citizens United case: corporations are "people" with no limits on their political donations, while real living and breathing human beings are limited -- by law! -- in their donations. So the "person" of a corporation is above the law that applies to "mere persons" as represented by the bottom 99%.

Here is the reality of today:

... the four hundred richest Americans, whose total wealth exceeds the combined wealth of the bottom 150 million Americans put together, pay an average of 17 percent of their income in taxes. That’s lower than the tax rates of most day laborers and child-care workers.

Read the whole post.

Americans Love Their "Freedom"

Here's what happens in America is you try to promote democracy by registering voters in "Freedom" Plaza...



There is something deeply wrong about a people that label everything "freedom" and "liberty" and then go about arresting people for seemingly innocuous acts. If anything, trying to enfranchise the populace should be a "protected" activity, not something subject to arrest and imprisonment. This is especially disturbing because the fellow arrested was Ray Lutz, a 2010 Congressional candidate for the Democratic Party.

More details here...

Taibbi on the Two-Tier Legal System in the US

Here is a bit from an excellent post by Matt Taibbi in his Rolling Stone blog:

In one of the more severe judicial ass-whippings you’ll ever see, federal Judge Jed Rakoff rejected a slap-on-the-wrist fraud settlement the SEC had cooked up for Citigroup.

I wrote about this story a few weeks back when Rakoff sent signals that he was unhappy with the SEC’s dirty deal with Citi, but yesterday he took this story several steps further.

Rakoff’s 15-page final ruling read like a political document, serving not just as a rejection of this one deal but as a broad and unequivocal indictment of the regulatory system as a whole. He particularly targeted the SEC’s longstanding practice of greenlighting relatively minor fines and financial settlements alongside de facto waivers of civil liability for the guilty – banks commit fraud and pay small fines, but in the end the SEC allows them to walk away without admitting to criminal wrongdoing.

This practice is a legal absurdity for several reasons. By accepting hundred-million-dollar fines without a full public venting of the facts, the SEC is leveling seemingly significant punishments without telling the public what the defendant is being punished for. This has essentially created a parallel or secret criminal justice system, in which both crime and punishment are adjudicated behind closed doors.

...

Judge Rakoff blew a big hole in that practice [the SEC’s longstanding practice of greenlighting relatively minor fines and financial settlements alongside de facto waivers of civil liability for the guilty – banks commit fraud and pay small fines, but in the end the SEC allows them to walk away without admitting to criminal wrongdoing] yesterday. His ruling says secret justice is not justice, and that the government cannot hand out punishments without telling the public what the punishments are for. He wrote:

Finally, in any case like this that touches on the transparency of financial markets whose gyrations have so depressed our economy and debilitated our lives, there is an overriding public interest in knowing the truth. In much of the world, propaganda reigns, and truth is confined to secretive, fearful whispers. Even in our nation, apologists for suppressing or obscuring the truth may always be found. But the S.E.C., of all agencies, has a duty, inherent in its statutory mission, to see that the truth emerges; and if it fails to do so, this Court must not, in the name of deference or convenience, grant judicial enforcement to the agency's contrivances.

Notice the reference to how things are “in much of the world,” a subtle hint that the idea behind this ruling is to prevent a slide into third-world-style justice.

...

Here’s a clip of me talking about the ruling last night on Countdown with Keith Olbermann.

Since Obama and his Attorney General aren't willing to treat crime seriously, hopefully the courts will step up and give the American people some justice.

The Police are Hard of Hearing

Either they are hiring deaf cops in NY City or the Constitutional protection of the "free press" isn't worth the paper it is written on...



I would say it is pretty obvious that option #2 is in effect in America. The press is "free" to report glowing stories about "job creators" and the heroic efforts of Republicans to control deficits. But when it comes to civil society and basic rights, the Constitution is a some relic from the past that nobody is interested in despite all the claims by the political right that they are "guided" by the Constitution.

If you are curious about just how "easy" it is to get a press pass so that you can try to exercise your so-called "rights" in America, here is an article in the New York Observer that lays out some of the details and frustrations of the "process". As she points out, the law "requires":

Applicants also must submit one or more articles, commentaries, books, photographs, videos, films or audios published or broadcast within the twenty–four (24) months immediately preceding the Press Card application, sufficient to show that the applicant covered in person six (6) or more events occurring on separate days.

But to meet that requirement:

According to the last paragraph, you have to demonstrate coverage as an uncredentialed reporter in order to get credentialed. So the only way to comply with the law is to have previously broken the law repeatedly.

Ah... the joys of a bureaucratic mind. You can get a job if you can prove that you are presently employed. Meanwhile, we'll beat you about the ears for being lazy and unwilling to work because you are unemployed. That's the reality for 25 million unemployed in the US. Obviously the same screwy "bureaucratic rules" apply to getting "press credentials". First you need to be credentialed and previously covered 6 news events. This makes the insiders safe, but it create a Kafkaesque nightmare for anybody outside the system.

What Passes for "Justice" in America

From a post by Matt Taibbi on his Rolling Stone blog:

Woman Gets Jail For Food-Stamp Fraud; Wall Street Fraudsters Get Bailouts

Had a quick piece of news I wanted to call attention to, in light of the recent developments at Zuccotti Park. For all of those who say the protesters have it wrong, and don’t really have a cause worth causing public unrest over, consider this story, sent to me by a friend on the Hill.

Last week, a federal judge in Mississippi sentenced a mother of two named Anita McLemore to three years in federal prison for lying on a government application in order to obtain food stamps.

Apparently in this country you become ineligible to eat if you have a record of criminal drug offenses. States have the option of opting out of that federal ban, but Mississippi is not one of those states. Since McLemore had four drug convictions in her past, she was ineligible to receive food stamps, so she lied about her past in order to feed her two children.

The total "cost" of her fraud was $4,367. She has paid the money back. But paying the money back was not enough for federal Judge Henry Wingate.

Wingate had the option of sentencing McLemore according to federal guidelines, which would have left her with a term of two months to eight months, followed by probation. Not good enough! Wingate was so outraged by McLemore’s fraud that he decided to serve her up the deluxe vacation, using another federal statute that permitted him to give her up to five years.

He ultimately gave her three years, saying, "The defendant's criminal record is simply abominable …. She has been the beneficiary of government generosity in state court."

Compare this court decision to the fraud settlements on Wall Street. Like McLemore, fraud defendants like Citigroup, Goldman Sachs, and Deutsche Bank have "been the beneficiary of government generosity." Goldman got $12.9 billion just through the AIG bailout. Citigroup got $45 billion, plus hundreds of billions in government guarantees.

All of these companies have been repeatedly dragged into court for fraud, and not one individual defendant has ever been forced to give back anything like a significant portion of his ill-gotten gains. The closest we've come is in a fraud case involving Citi, in which a pair of executives, Gary Crittenden and Arthur Tildesley, were fined the token amounts of $100,000 and $80,000, respectively, for lying to shareholders about the extent of Citi’s debt.

Neither man was forced to admit to intentional fraud. Both got to keep their jobs.

Anita McLemore, meanwhile, lied to feed her children, gave back every penny of her "fraud" when she got caught, and is now going to do three years in prison. Explain that, Eric Holder!

Here’s another thing that boggles my mind: You get busted for drugs in this country, and it turns out you can make yourself ineligible to receive food stamps.

But you can be a serial fraud offender like Citigroup, which has repeatedly been dragged into court for the same offenses and has repeatedly ignored court injunctions to abstain from fraud, and this does not make you ineligible to receive $45 billion in bailouts and other forms of federal assistance.

This is the reason why all of these settlements allowing banks to walk away without "admissions of wrongdoing" are particularly insidious. A normal person, once he gets a felony conviction, immediately begins to lose his rights as a citizen.

But white-collar criminals of the type we’ve seen in recent years on Wall Street – both the individuals and the corporate "citizens" – do not suffer these ramifications. They commit crimes without real consequence, allowing them to retain access to the full smorgasbord of subsidies and financial welfare programs that, let’s face it, are the source of most of their profits.

Why, I wonder, does a bank that has committed fraud multiple times get to retain access to the Federal Reserve discount window? Why should Citigroup and Goldman Sachs get to keep their status as Primary Dealers of U.S. government debt? Are there not enough banks without extensive histories of fraud and malfeasance that can be awarded these de facto subsidies?

Go read the original post to get all the embedded links. These are worth following up. You need to really appreciate the "tilt" of justice in America. The makes all too obvious that there is one "justice" for the 99% and a very different "justice" for the 1%.

What surprises me is that most people don't join the protests. They simply put up with the vast and ugly injustice in American life. They continue to hope for a better day, a fairer deal. But it is a fruitless hope. Only if there is profound change in America will the bottom 99% get a chance to improve their lot. They need to fight so that they can get a fair piece of the economic pie. For 30+ years under Republican rule, the rich have gotten fabulously wealthy while the middle class has treaded water and the poor have actually become poorer. Tragic.

Matt Taibbi Sees a Glimmer of Hope

In his Rolling Stone blog, Matt Taibbi sees the first sign that the judicial system is standing up to the corrupt banks and the collusion of the Obama administration with corruption on a monumental scale:

Federal judge Jed Rakoff, a former prosecutor with the U.S. Attorney’s office here in New York, is fast becoming a sort of legal hero of our time. He showed that again yesterday when he shat all over the SEC’s latest dirty settlement with serial fraud offender Citigroup, refusing to let the captured regulatory agency sweep yet another case of high-level criminal malfeasance under the rug.

The SEC had brought an action against Citigroup for misleading investors about the way a certain package of mortgage-backed assets had been chosen. The case is very similar to the notorious Abacus case involving Goldman Sachs, in which Goldman allowed short-selling billionaire John Paulson (who was betting against the package) to pick the assets, then told a pair of European banks that the “designed to fail” package they were buying had been put together independently.

This case was similar, but worse. Here, Citi similarly told investors a package of mortgages had been chosen independently, when in fact Citi itself had chosen the stuff and was betting against the whole pile.

This whole transaction actually combined a number of Goldman-style misdeeds, since the bank both lied to investors and also bet against its own product and its own customers. In the deal, Citi made a $160 million profit, while its customers lost $700 million.

Goldman, in the Abacus case, got fined $550 million. In this worse case, the SEC was trying to settle with Citi for just $285 million. Judge Rakoff balked at the settlement and particularly balked at the SEC’s decision to allow Citi off without any admission of wrongdoing. He also mocked the SEC’s decision to describe the crime as “negligence” instead of intentional fraud, taking the entirely rational position that there’s no way a bank making $160 million ripping off its customers can conceivably be described as an accident.

“Why should the court impose a judgment in a case in which the SEC alleges a serious securities fraud but the defendant neither admits nor denies wrongdoing?” And this: “How can a securities fraud of this nature and magnitude be the result simply of negligence?”

Rakoff of course is right – the settlement is nuts. If you take Citi’s $160 million profit on the deal into consideration, what we’re talking about then is a $125 million fine for causing $700 million in damages. That, and no admission of wrongdoing.

...

So to recap: a unit of Citigroup, having repeatedly violated the same laws and having repeatedly violated the SEC’s own cease-and-desist orders and injunctions, is dragged into court one more time for committing a massive fraud.

And what does the SEC do? It doesn’t even bring up Citi’s history of ignoring the SEC’s own order, slaps the bank with a fractional fine, refuses to target any individuals, allows the bank to walk away without an admission of wrongdoing, and puts a cherry on the top by describing the $160 million heist not as a crime, but as unintentional negligence.

There is a lot more in Taibbi's post. Go read the whole thing.

I sure hope Matt Taibbi is right and that this is the dawning of a new day, a better day for America. But I'm pretty pessimistic given the craven political position of the Republicans as the party of the 0.01%, the Obama administration as a handmaiden to crime and corruption, and the spineless behaviour of the Democrats. It is nice to hope that 1 out or 3 branches of government is recovering its senses and will put up a fight to protect the bottom 99%, but it is way to early to believe in real change and 1 out of 3 is still a losing position!

... and here is Matt Taibbi in a different post on his Rolling Stone blog taking on the corrupt politics that is so intent on shoveling big bucks to the fraudsters and criminals while squeezing the life blood out of the bottom 99%:

David Brooks, the [gratuitous insult deleted], wrote this this morning entitled "Mitt Romney, the Serious One." In it, he explained how Romney’s recent decision to unveil a plan for reforming the entitlement system "demonstrates his awareness of the issues that need to define the 2012 presidential election."

Romney grasped the toughest issue – how to reform entitlements to avoid a fiscal catastrophe – and he sketched out a sophisticated way to address it.

So we had a giant financial crash in 2008 that necessitated a bailout costing a minimum of nearly $5 trillion and perhaps ultimately costing $10 trillion more, we have foreclosure crisis with more than million people a year losing their homes, and we have a burgeoning European debt disaster that threatens to devastate the global financial system – and the chief issue facing the country, according to Brooks and the Times, is reforming the entitlement system?

The column goes on to throw bouquets on Romney’s plan to semi-privatize Medicare and Social Security. Romney’s ideas are not as draconian as Paul Ryan's, but they do pave the way for Wall Street’s ultimate goal – full privatization of Social Security and Medicare.

Think about what such reforms might mean. Your typical Medicare/Social Security recipient might already have been ripped off three different ways in this era.

He might have been sold a crappy mortgage or a refi by a Countrywide-type firm (which often targeted the elderly). He might then also have unwittingly become an investor in such mortgages and seen the value of his retirement holdings devastated (many of the banks sold their crappy mortgage-backed securities to state pension funds).

Lastly, if he paid taxes, he saw part of his tax money go to pay off the bets the banks made against these same mortgages.

So now that Wall Street has ripped off this segment of society three times, it makes all the sense in the world that Mitt Romney – a former Wall Street superstar who was a chief architect of the modern executive-compensation-driven corporation – is coming back and telling us that we need to cut their Medicare and Social Security benefits in order to defray the cost of the previous three scams.

...

Advocating the turning over of Social Security management to Wall Street after the 2008 crash is a little like asking Paris Hilton to pilot Air Force One, or tabbing Charlie Sheen to manage the inventory of a hospital pharmacy – completely nuts, but to David Brooks, that makes Mitt Romney the “serious” candidate.

Again, go and read the original post to get the whole article as well as the embedded links to referenced material. It is well worth your while.

It is utterly depressing to read Matt Taibbi's exposés. But it is essential reading. The only way to stop the rot, corruption, and criminality is to understand what is happening and individually decide "enough!" and then band together through democratic agitation to stop the agenda to destroy the bottom 99%. The Occupy Wall Street is but one manifestation of what is needed. Much more is needed. Democracy is messy, it is slow to get riled, and it works in mysterious ways, but it is the only tool guaranteed to effect real change. The idiots calling for "revolution" are asking for blood on the streets and failure. Real change is slow, painful, and democratic.

Rule of Law Will Now be Attempted in the US

One of the foundation stones of civilization, going back thousands of years, is that a state is sound and mature only when it is under the rule of law, i.e. the code of conduct is in fact codified and enforced.

It appears that the US is about to try to stop being a rogue state, a criminal haven, and attempt to live under the 'rule of law'. Here is a video clip of a Dylan Rattigan show talking about the current attempt to bring fraudulent banks under control and impose the rule of law on them:



It is going to be awfully hard for the top 0.1% in the US to accept that the glory days of buying and selling politicians may be coming to an end, that the running of a two-tier legal system where billionaries get a 'get out of jail free card' while the bottom 99.9% feel the heavy hand of a country with the highest incarceration rate in the world might go under.

The rampant criminality where banks commit massive fraud, create a bubble, then let the world's economy go down the drain while the bankers continue to collect billion dollar bonuses may finally be coming to an end. No thanks to Obama. His administration, like the Bush and preceding administrations, has been a total tool of the criminal elite in the US. This push for the 'rule of law' is coming from the state attorney generals. Finally!

The US may finally be stepping back from the brink, from its banana republic, rogue state, criminal enterprise collapse, back into the family of nations where law is above greed. Maybe. We will have to watch this closely.

Rogue Police

In theory the police are agents of the people, their job is to "serve and protect" their community. But for some, the rogue elements among the police, those with a pathological thuggish personality, this becomes a "license to kill". Here is an example:



And this:



Sadly, the police argue that this was "justified force" and the responsible thugs were given only the lightest of wrist slaps. Why?

The violence of white collar crime, the Wall Street banks have thrown 25 million people out of work and foreclosed on 10 million home owners as part of a fraudulent crime spree. The violence of these perpetrators has not resulted in a single arrest or the thuggish police assaulting any of the "suits" of Wall Street. But if you stand in the streets to protest that your country has gone off the rails and that authorities are not doing their sworn duty to uphold the law, you are pepper sprayed and targeted by canisters of exploding tear gas. Go figure.

You have "Rights" but not the Right to Exercise Your "Rights"

Here is a bit from a post by a legal site that claims to be helping the public. Here they try to explain your "rights" and just how much limitations can be put on them:

As protests supporting Occupy Wall Street have swelled in recent weeks, hundreds of demonstrators have been arrested across the U.S. This weekend, nearly 100 people were arrested in New York and 175 in Chicago. More than 100 protesters were arrested in Boston last week; a few weeks ago, 700 were arrested on the Brooklyn Bridge.

So, if the First Amendment guarantees the right to peaceable assembly, why do peaceful protestors keep getting arrested — and sometimes pepper-sprayed and beaten up?

We take a closer look at the laws governing protests and how the government can limit them.

Time, place and manner restrictions

The First Amendment is not absolute. Government can make reasonable stipulations about the time, place and manner a peaceable protest can take place, as long as those restrictions are applied in a content-neutral way.

But what constitutes a reasonable time, place and manner restriction? "It depends on the context and circumstances," said Geoffrey Stone, a professor specializing in constitutional law at the University of Chicago. "Things like noise, blockage of ordinary uses of the place, blockage of traffic and destruction of property allow the government to regulate speakers."

Stone gave a few examples of impeding ordinary usage: disturbing patients at a hospital, preventing students from going to school, or, more relevant for the Occupy movement, disrupting the flow of traffic for a long period of time.

The majority of Occupy Wall Street-related arrests have been on charges of disorderly conduct. Under the New York Penal Code, that includes making "unreasonable noise," obstructing "vehicular or pedestrian traffic," or congregating "with other persons in a public place and refus[ing] to comply with a lawful order of the police to disperse." Basically, the central question is the standard of reasonableness. "You have to tolerate a certain amount of inconvenience in order to make room for First Amendment activity, but not so much that it disrupts things," Stone said. Individual states' unlawful assembly and disorderly conduct statutes have to fall in line with this standard. "They can regulate it less if they want to," Stone added, "but not more."

I remember as a kid watching the blacks in the Deep South trying to exercise their "right" to vote. They would be made to wait in the hot sun all day. They would be told to come back umpteen times. They would be given "tests" that mysteriously only blacks failed, not whites. Etc., etc. They had "rights" just no right to exercise their rights.

Native Indians in the US signed umpteen "perpetual treaties" only to watch them be torn up a few years later. Many Indian bands have horror stories to tell. The "trail of tears" for the civilized tribes of the US Deep South that freed up land for the big slave plantations is especially egregious. These are tribes that had signed many treaties, even fought on the side of the US revolutionaries and the side of the new United States in the Battle of 1912. All these "rights" and "promises" were ignored to feed the land fever of white slave owners.

This "expert" for propublica goes through the motions as if rights were real and the state is truly interested in your rights and it is just a question of balancing rights with responsibilies. What a load of crap. If they could get away with it, governments would have a rule that you can only demonstrate between 3:00 AM and 4:00 AM on one side of town, and by the way, you must have a permit that can only be picked up on the other side of town between 2:59 AM and 3:00 AM and only those with a valid permit at 3:00 AM at the demonstration site will be allowed to demonstrate. (A version of this is the recent rules where you have have "public" demonstrations during high profile international gatherings but only at a "designated" demonstration site that is miles from where the dignataries gather and is carefully fenced in with riot cops all around to ensure that in this "proper" demonstration area you won't be seen or heard by anybody.)

I'm pretty positive that Syria has a wonderful Constitution which lays out all kinds of "rights" for its citizens. But right now the only "right" that citizens seem to be enjoying is a bullet through the brain or torture in some dungeon run by Bashar al-Assad's thugs. Under the USSR's Constitution people had wondeful, extensive, very progressive "rights". But in reality if you thought you could exercise your rights you would be sent off to a slave labour camp in Siberia or shelved in a 24x7 drugged state in an insane asylum. That's how you got to "exercise" your rights in the USSR.

The thuggery by the US and its police is just one in a long line of countries with wonderful "rights". Sure the top 1% get to exercise those rights. But the 99% better not cross the line. Their "rights" have a way of mysteriously becoming re-interpreted as disorderly conduct, assaulting a police officer, or some other drummed up charge. If you read the labour history of the US (late 19th century early 20th century) it is filled with workers exercising their "rights" only to be mowed by by police or private gangs: the (Homestead Strike, the Lattimer Massacre, the Ludlow Massacre, the Columbine Mine Massacre, the Chicago Memorial Day Massacre, etc.)

Oh... and I just noticed this. A French court has ordered ISPs to block any site that allows people to post videos of police misconduct. I guess the theory is "out of sight, out of mind". Or, if nobody sees it, then it isn't a crime.

The Tribunal de Grande Instance de Paris [official website, in French] on Friday ordered [judgment in PDF, in French] French Internet service providers to block access to Copwatch Nord Paris I-D-F, a website designed to allow civilians to post videos of alleged police misconduct. The decision was applauded by the police union, Alliance Police Nationale (APN) [union website, in French], which argued that the website incited violence against police. Jean-Claude Delage, secretary general of the APN, said that "[t]he judges have analyzed the situation perfectly—this site being a threat to the integrity of the police — and made the right decision." Opponents of Internet censorship were also quick to comment on the judgment. Jeremie Zimmermann, spokesman for La Quadrature du Net [advocacy website], a Paris-based net neutrality organization, called the order "an obvious will by the French government to control and censor citizens' new online public sphere." The site was ordered to be blocked immediately.

In France you have the right to think that police might violate the rights of citizens, but you have no right to communicate that belief because that is "an insult to the majesty of the Law". I guess the reasoning is that if you let people question the honesty and integrity of the government then you are on the slippery slope to anarchy. So everybody will be liable by law to only say good things about their laws, their politicians, the rich, and the police. You can insult your neighbor, the poor, immigrants, and dogs in the street. But not the noble "leaders" of society and their enforcers, the police.

You Have "Rights" But Just Not Here

Here is an attempt to hold an "assembly to petition the Government for a redress of grievances" on the steps of the Supreme Court. But you get arrested there despite what the US First Amendment says:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

So... the Constitution says you have a right to petition, but the "laws of the land" say not here, not there, and not over there. You have a right, but if you try to exercise that right, you get arrested! Here was an attempt to exercise a Constitutional right and it got the protesters arrested:



The joke is:

The Constitution gave no "rights" to corporations, but the Supreme Court has empowered things to be "people" by giving corporations more rights than people have. Corporations don't need to petition their government because they simply buy the politicians they need.

The reason why the founders of the US put in the First Amendment was that they knew that people would not have the power individually and had to have a mechanism to get the attention of their government. But the government, through laws and legal decisions, has systematically shutdown all access except to those with the money to buy access. The Supreme Court has participated in this farce by twisting the Constitution to ignore facts and make up "new realities" that cater to the very rich in the very process that has corrupted the system!

Ignorance of the Workings of Capitalism

Here is a poor misguided woman who apparently doesn't understand the secrets of "financial engineering" and the kind of "God's work" that Lloyd Blankfein is doing at Goldman Sachs.

Click to Enlarge
The successful capitalists, like all the big shots on Wall Street running the big financial institutions in the US, know that the secret to getting billion dollar bonuses is just what this woman is complaining about.

And this woman should know that Barack Obama, his Attorney General, Eric Holder, his Secretary of the Treasury, Timothy Geithner, and his Chairman of the Federal Reserve, Ben Bernanke, have all assured us that doing this kind of slice-and-dice securitized mortagages -- as well as the using bribes to get the big ratings companies to stamp them as AAA -- is all completely legal.

They keep assuring us that "nobody is hurt" by financial engineering because these instruments were bought by "sophisticated investors" who obviously understood that within weeks of buying AAA-rated bonds they would blow up and become worthless junk. That is exactly what "sophisticated investors" are known to do. And this is exactly the job of big Wall Street firms. To take billion dollar investors and sign them up for so-called AAA-rated investments which "mysteriously" blow up just weeks after you buy them.

That's not criminal that's just good salemanship. Just like a used car salesman who sells you a 1992 Buick with 300,000 miles on it with a brakes that don't work, a transmission that can't get out of first gear, and whose engine puts out clouds of noxious black smoke and gets you to pay $20,000 for the "little gem of a car" is just showing his highly skilled automotive expertise and deserves the big bonuses from the fly-by-night used car lot owner. No crime here when the salesman by tells you the car has passed all mechanical inspections and is in "top-top shape" and you just need to get the car out on the road to do a shakedown drive to get those brakes working, the engine to settle down, and the transmission to start changing gears. Nobody would think that salesman should be arrested for this. It isn't misrepresentation to claim this care is in "mint condition", right?

That's capitalism... at least according to the big bonus CEOs of Wall Street, and Obama and his administration, all all the big shots in the Republican party. All of these big important people are telling us that the $10 trillion collapse in the econonmy, the 25 million unemployed, the 10 million foreclosed homes are just "normal business" and no crimes have been committed. This is just the wonders of "the market" where the nimble and clever get handsomely rewarded while the bottom 99% get fleeced.

All the politicians are telling us there has been no crime. Taxpayers will just have to "suck it up" and bail out the big boys so they can kept their billion dollar bonuses. The only arrests needed is for that riffraff on the streets with those threatening and illegal "occupy!" signs. Those protesters are attacking the very foundations of our society and won't be happy until they have brought down the proud institutions that have delivered "the American way of life".

The Glorious Operation of Capitalism

If you go to a bank in New York City and request to close your bank account, they will arrest you...

Update 2011oct17: Here is a personal account by one of the victims of the "you try to close your account, we will arrest you" event.

Details in the Gothamist.com:

Below, you can see video of some of the protesters in the bank trying to close their accounts who are then arrested by police. That includes one woman who argues she is a customer, and allowed to be in the bank—and then she is picked up by a policeman and taken away.

Incredible!

The mouthpieces of capitalism talk about freedoms, but the freedom to close a bank account apparently isn't one of them. I'm puzzled exactly which law the banks have managed to get their bought-and-paid-for politicians to pass which makes it illegal to request that a your own bank account be closed and your money returned.

Obviously the Wall Street banks have gone one step further than simply using their politicians to siphon taxpayer dollars into the corporations. They are now simply seizing people's money directly and arresting you if you think you have some legal right to your own money!



And here they are hauling people away. I guess the banks love your money more than they love you so they will keep your money while using the police to enforce a "separation" between you and your money.



It is interesting how banks can decide some people are "legitimate" customers while others are not allowed because the bank simply refuses to let the customer into the bank building:



The banks love to set you up with mortgages with hidden charges and "gotcha" stuff. The biggest "gotcha" is they won't let you close your account!

Waste & Fraud

The political right in the US loves to rant about "waste and fraud". But as Dean Baker points out in this post in his Beat the Press blog, they overlook the really big cases of waste and fraud in the US:

Patent Monopolies Lead to Enormous Economic Waste

It would have been to include the view of an economist in this article that reports on how China and India are now able to produce low-cost versions of bio-tech cancer drugs. These drugs sell now for several thousand dollars per dose as a result of government granted patent monopolies.

Patent monopolies lead to enormous market distortions in the same way as other barriers to trade. However, the impact of patents is much larger since they have a much bigger effect on prices. It is rare that tariffs raise the price of goods by more than 20-30 percent. By contrast, patents often raise the price of protected drugs by several thousand percent.

The huge profits created by patent rents are the cause of kickbacks to doctors, misleading information on the safety and effectiveness of drugs, and government corruption that extends the length and scope of patent rents. These distortions lower the quality of health care and raise its cost. There are far more efficient mechanisms for supporting medical research.

This article also errs in asserting that countries can only issue compulsory licenses for drugs in cases of emergencies. The terms of the WTO allow for compulsory licensing under fairly general conditions.

But they same kind of double standard applies to criminal acts. A young punk does a stick-up at a corner store and gets $100 goes to jail for 10 years. But a white collar criminal steal $1 billion is lucky to spend a few hours in jail waiting to be bailed out by his lawyer. The judges are "sympathetic" to the white collar criminal. They "understand" that he didn't mean to hurt anybody. But the corner store robber is vermin and must be squished. Funny... the corner store robber is a gnat compared to the white collar criminal elephant. When you steal $1 billion (like the Wall Street criminals), you steal a life's savings from thousands of people. And that isn't a crime? Not according the the "judicial" system.

The Ten Step Program to Fix the US Financial Industry

Here are the 10 "easy" steps proposed by Barry Ritholtz. He's right. It is easy to propose them. What is hard is to get politicians (who are in the pocket of Wall Street) to pass the legislation to give teeth to these 10 steps:

As I discussed yesterday on Dylan Ratigan, we can easily prevent the next credit crisis caused by a TBTF banks (and the rogue traders they employ), we need to take 10 EZ steps:

1. Depression era Glass Steagall legislation needs to be restored (it was repealed in 1998). Separating FDIC deposit banks with much riskier Wall Street iBanks and speculators is imperative.

2. The Commodity Futures Modernization Act of 2000 needs to be repealed, (Those opposed to this repeal should be deported).

3. Rating agencies need to have their official SEC charters revoked. If they want to sell ratings, they need to do so in the marketplace, not by regulatory mandate.

4. The SEC issued “Bear Stearns exemption” — replacing the 1975 Net Capitalization Rule’s 12 to 1 leverage limit to with essentially unlimited leverage — needs to be legislatively revoked, and the old rule officially reinstated.

5. The Depository Bank Reserve Rules that have whittled away need to be restored to decades ago levels. Basel 3 does not go far enough. And Federally Pre-emption of States anti-predatory lending laws must be revoked.

6. The Federal Reserve must focus on Employment and Inflation — not backstopping speculators.

7. Nonbank mortgage underwriters (i.e., Subprime lenders) need to be subjected to same comprehensive federal supervision as other banks. Traditional credit standards need to be applied.

8. Mortgage underwriting standards must revert to pre-2000 standards, including verifying income, payment history, and credit scores, Loan to value (LTV). And Automated underwriting (AU) systems need to be revamped or removed.

9. “Innovative” mortgage products — 2/28 ARMs, I/O s, Neg Ams — need to have stronger restrictions on them

10. Clawbacks of corporate bonuses AND stock sales paid for transactions that eventually turn out to be false, temporary, or losing positions (think subprime or CDO underwriting) must be the law of the land. This includes sales people, trading desks and executives.

That’s my 10 — there certainly are lots more, but this list will go a long way to preventing the next banking disaster . . .

Now... what are the 10 easy steps to wean politicians off lobbyists and under the table payments?

The US's Hidden Tax

Funny. Washington is paralyzed by a fight over deficits and the debt, over whether to raise taxes or cut taxes, over whether deregulation or a massive WPA will best create jobs. But these fights end up being over crumbs off the table.

Here is a bit from an article in Project Syndicate by Nassim Nicholas Taleb and Mark Spitznagel that point at a hidden $5 trillion tax on the American economy and the American people that Washington refuses to talk about or even acknowledge:

For the American economy – and for many other developed economies – the elephant in the room is the amount of money paid to bankers over the last five years. In the United States, the sum stands at an astounding $2.2 trillion for banks that have filings with the US Securities and Exchange Commission. Extrapolating over the coming decade, the numbers would approach $5 trillion, an amount vastly larger than what both President Barack Obama’s administration and his Republican opponents seem willing to cut from further government deficits.

That $5 trillion dollars is not money invested in building roads, schools, and other long-term projects, but is directly transferred from the American economy to the personal accounts of bank executives and employees. Such transfers represent as cunning a tax on everyone else as one can imagine. It feels quite iniquitous that bankers, having helped cause today’s financial and economic troubles, are the only class that is not suffering from them – and in many cases are actually benefiting.

Sadly, the authors of this article see no hope in relying on government regulators or the politicians to rein in the fraud and crime in the big banks. Instead, their lone hope is that investors will turn their backs on these companies and refuse to invest in them.

We don’t believe that regulation is a panacea for this state of affairs. The largest, most sophisticated banks have become expert at remaining one step ahead of regulators – constantly creating complex financial products and derivatives that skirt the letter of the rules. In these circumstances, more complicated regulations merely mean more billable hours for lawyers, more income for regulators switching sides, and more profits for derivatives traders.

That could work, but it requires a huge amount of self discipline and a deep belief in cooperative self-regulation by investors. Personally, I don't see it happening. I think the justice system and the political system have to come down hard on the banks. But Obama has refused to do it. So my hope is that somehow in 2012 American citizens will find a way to select representatives at all levels of government who pledge to hold the criminals of Wall Street and the big banks accountable for their acts. They need to unleash the police and they need to unleash a torrent of heavy-duty regulation on the banks. They need to come down hard on the exorbitant salaries of the financial industry to get people to abandon it and and stop the lure for young people to take up a life of crime as a "financial engineer".

Scientific Visualization

Here is a nice animation to let you take a roller coaster ride through just over a century of house price data gathered by Case Shiller:



As you arrive at the 2000s in this animation keep telling yourself "the Wall Street banks got the ratings agencies to stamp AAA on mortgage-backed securities because the risk modelers data showed that house prices only go up and never down".

Watch the video and then tell me there was no fraud, no crime, on Wall Street when it sold trillions in securitized paper based on these "financially engineered" instruments that blew up and went from AAA-rated to junk status in a matter of months in 2007-8.

I didn't expect George Bush to arrest any of his Wall Street buddies over this crime of the century. But I'm really, really outraged that Barack Obama has decided to shield the financial manipulators of Wall Street from the long arm of the law.

Where is the justice for the tens of millions of Americans whose savings have been cratered, who have lost their homes, and who are now unemployed and will stay unemployed for most of a decade? Where is the justice?

The Ugly Truth of Citizens United

The US Supreme Court has accepted the argument in the Citizens United case that corporations have an unrestricted right to use shareholder money to buy politicians. Why? Because "corporations are people". Yeah, sure.

Here's a reminder from an article written by Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and posted on the Naked Capitalist blog:

Unlike real people, corporations cannot be sent to jail. Corporate shells shield owners and managers from criminal prosecution for the wholesale frauds that have left Countrywide Financial, Bank of America, Citibank, JP Morgan Chase and other pillars of the banking community free to make civil settlements for deceptive policies without admitting wrongdoing. And whereas individual crooks need to pay their own lawyers, corporations pick up the tab for their managers, while contributing generously to politicians who rewrite the laws to decriminalize fraud and deceptive business dealing. The corporate-backed media applaud politicians who insist that families “take responsibility” for their unemployment risk, debts and health care – while bailouts free the wealthy from having to suffer losses on bad loans.

Funny how the same Supreme Court which couldn't bother to let the ballots be counted in 2000 to decide the election has been able to sift the tea leaves and discover that corporations are "people". Well, if so, let's start sending corporations to jail! Take the whole kit and caboodle off and lock them up right down to the night watchman.

If we make corporations accountable as "persons" then people will be more cautious about taking a job at a corporation. They will want bigger salaries for the higher risk that they can go to jail as part of the "corporate body" that did a criminal act. That might be salutary for everybody. Better wages. Slower growth for corporations. More workers ready to be whistle-blowers about corporate corruption and crime.

Cory Doctorow on Copyright Law

Here is a talk by Cory Doctorow giving a talk to Siggraph 2011 on copyright law. It is well worth your time to listen carefully to what he tells you about dysfunctional copyright laws. You can skip the intro and jump right into the talk at 2:20: