If you simply looked at the archive page for Wash Park Prophet, you'd think that this was a pretty slow year for blogging, but that would miss the main blogging event for me in 2011, the launch of my Dispatches From Turtle Island blog, focused mostly on physics and anthropology where 205 posts this year were diverted in an effort to distinguish policy and political and cultural posts (which have remained here) and apolitical science blogging there.
31 December 2011
29 December 2011
Getting to Grandpa's House
Is it faster to fly than to drive to grandpa's house (1176 miles away according to mapquest), after the time spent going to the airport, waiting in security lines, and getting a ride from the airport to the final destination are considered, with a family of four that can't afford to cut it close?
They answer is yes. In real life, it took 11 and a half hours all told. By car, according to mapquest, it would have taken 18 hours and 13 minutes. But, it is less of an edge than I would have expected. The actual time in the air, of course, is only about a third of the total for travel by air.
They answer is yes. In real life, it took 11 and a half hours all told. By car, according to mapquest, it would have taken 18 hours and 13 minutes. But, it is less of an edge than I would have expected. The actual time in the air, of course, is only about a third of the total for travel by air.
Colorado Joins Washington State and Rhode Island On Medical Marijuana
The Colorado Department of Revenue has joined Washington State and Rhode Island in asking the federal Drug Enforcement Agency to reclassify marijuana as a Schedule II drug that may be prescribed by physicians under federal law, from its current status as a Schedule I drug that has no medicinal value, despite clear scientific evidence to the contrary.
From the point of policy and scientific fidelity to the legal standard, the switch would be a no brainer, but the DEA has repeatedly refused to acknowledge this reality in the past. Wikipedia summarizes these efforts. In short:
From the point of policy and scientific fidelity to the legal standard, the switch would be a no brainer, but the DEA has repeatedly refused to acknowledge this reality in the past. Wikipedia summarizes these efforts. In short:
The Controlled Substances Act provides a process for rescheduling controlled substances by petitioning the Drug Enforcement Administration. The first petition under this process was filed in 1972 to allow cannabis to be legally prescribed by physicians. The petition was ultimately denied after 22 years of court challenges, although a pill form of cannabis' psychoactive ingredient, THC, was rescheduled in 1985 to allow prescription under schedule II. In 1999 it was again rescheduled to allow prescription under schedule III. A second petition, based on claims related to clinical studies, was denied in 2001. The most recent rescheduling petition was filed by medical cannabis advocates in 2002 and, as of May 2010, was being reviewed by the Barack Obama administration. Currently 16 states and Washington D.C. have legalized the use of medical marijuana, and hemp products are sold widely in the U.S. today.
Larry Ribstein Died Christmas Eve
Law professor Larry Ribstein, best known as a pre-eminent scholar of limited liability company law, died on on Christmas Eve of a stroke. More rememberances can be found here. I have regularly used his treatise, Ribstein & Keatinge on Limited Liability Companies, and have heard him speak on the subject. He was highly influential in the drafting of the Colorado's laws on the subject.
Paranoia Waning
This winter's semi-annual family trip by plane revealed some good news for once. A decade after 9-11, the airport security system run by the Transportation Security Administration has gone from paranoid to merely ineffectually earnest. The constant soundtrack of elevated security levels attached to a color code has faded to a periodic warning not to leave bags unattended. Children no longer have to remove their shoes at security checkpoints. Dare I say that the attitude of the TSA workers is also not quite so on edge? Let's hope it lasts.
22 December 2011
A Story About Mirror Twins And The Mysteries Of Gender
We aren't quite sure how gender identity works. Hormones play a part, but they aren't the whole story, and genes aren't the whole story either.
If you've read growing up stories about transgender children, this story in the Boston Globe, about twins in Maine (purportedly identical twins), one of whom is transgender, and the other of whom is not, rings true and is extremely familiar. This post recaps a lot of the same issues I addressed with more research rigor three years ago in response to some news stories in Colorado, and covers a lot of the same grounds, with the exception of the data point provided by the identical twin aspect of the Boson story.
Questions Of How and Why
In some ways, the notion that the two identical twins have such different personality is more notable than that they have different gender identity. While it isn't safe to generalize, certain most of the time transgender involves having XY genes and feeling certain that you are a girl, or having XX genes and feeling certain that you are a boy. Ergo, there is nothing conceptually impossible about genetically identical people not having identical gender identity.
But, twins aren't just clones of each other - genetically identical people who may be born to different gestational mothers at different points in time. Not only are they genetically identical, they also gestated in the same womb at the same time. And, yet, almost uniformly in the instances I've heard described, a conclusion that someone has a transgender identity manifests in a way that is almost impossible to ignore, even if you try very hard to do so, by preschool age - the article says the matter was absolutely undeniable by age four and manifested to some extent well before that point. And, given how difficult it is to make any sense of what infants are about in personality beyond one or two very basic dimensions, the inference that a transgender identity is probably congentital, even though it is probably not genetic (or at least, is probably not exclusively genetic) is a strong one.
The typicality of the case that the Boston Globe describes, in just one of two identical twins, suggests just a few possibilities.
1. Something within the gestational environment was different for one twin than the other, even though they were in the same womb. Thus, gestitational microenvironment might be involved. Maybe there was a different hormone balance at one end of the womb than the other at a critical moment for some reason like a residual estrogen accumulation from oral contraceptives taken at some point, or maybe a well placed kick to one of them during gestation took out the "turn into a male" circuit in one child but not the other by physically damaging it.
2. Something within the twining process wasn't perfectly symmetrical. Maybe one of the twins is a chimera of a lost fraternal triplet and the living twin, and the other is not, but genetic testing was at a locus where only the fraternal twin's genetic trace was detectable. Maybe there was a random hiccup in a key male or female identity moment of the development process that 99.99% of the time matches the genetic rule book but sometimes, in a rare process akin to a mutation but involved in the expression of that genome (perhaps an epigenetic mutation), there is a departure from the plan.
3. The trigger to a transgender identity happens post-natally in early childhood for who knows what reasons, perhaps related to some environmental exposure that happened to one child but not the other - maybe it was something not so unlike spiderman, maybe a mosquito carrying a particular rare version of a virus bit one and not the other, or bit both but only made it past the immune system of one of them due to something as random as having a cold at the time.
For what it's worth, if I had to, I'd put my money on an epigenetic mutation of unknown origin during gestation, quite possibly limited to neural epigenetics, as the likely cause, but I wouldn't bet the farm on any one of those options. My thought is that if there was a one time hormone exposure (which is possibly a more plausible mechanism for sexual orientation) that the XY genes would reassert themselves to some extent, albeit "out of tune."
For example, the notion that there might be a rare gene that makes it possible for the epigenetic mutation to happen, and that if that gene is present that the odds of an epigenetic mutation actually happening are one in six or something like that, is somewhat attractive, although I've near heard of transgender identities running in families in any of the literature on the subject.
Making Sense Of The More Complicated Than It Seems Gender Concept
All of this makes clear that the more subtle aspects of gender are real and inherent in people from some very early point in life, not simply a product of social conditions and environmental cues. I don't think that anyone who has seriously looked at the efforts that have been taken scientifically to determine if that is the case disagrees with that position at this point, although there are certainly differences in degree.
The conclusion may seem obvious, but after being taken for granted in a far simpler, two bin theory of gender that has been predominant for a lot of the time for a lot of history in a lot of cultures, from the 1960s through roughly the 1980s, the assumption that the aspects of gender pertaining to the mind were predominantly environmental and social in origin had a lot of currency.
Yet, the reality of transgender individuals is for gender what muons are for physics, something that nobody ordered or expected but that happens to exist. This reality takes nice simple grand unified theories of what gender is that fit 99.99% of the data and blows them out of the water. Sorry, Nature is telling us, explaining the last 0.01% (and these numbers are meant merely in the sense of very small number, not a specific actual value), is going to take a vastly more complex theory, but that is the reality of gender identity in the real world.
One can imagine a universe in which there are transgender and cisgender individuals. Indeed, in a lot of ways transgender identity is a much simpler to understand concept than the various concepts associated with sexual orientation. You have male hardware and genes but you mind and whole being insists that you are female, or visa versa.
Indeed, the profiles of people who are born androgonous but are genetically male, who are surgically modified in infancy to appear physically female and are raised female are remarkably similar to those of transgender individuals. The surgery never, or almost never, works, and despite all parental efforts the child made to look like and raised like a girl feels like a boy deep inside and nothing anyone can do can stop that train.
If you are willing to put the mechanism by which transgender identity happens in a black box (and you pretty much have to, in practice, because all of the usual suspects are ruled out) and simply get comfortable with the fact that there is a mechanism that isn't any of the usual suspects and that the mechanism in question is the one that really matters, it is all very straightforward to grasp.
Most of the cases described under the header of transgender identity fall neatly into a binary notion of gender. There just happens to be a mind-body discontinuity in these individuals, and since the mechanism by which sex chromosomes translate to gene expression in the body seems to be almost entirely mediated by sex hormones in the time period after birth, interrupting that process seems to be quite straightforward in theory, even if timing and technique require some doing.
If that were all there was to the story of gender it would be simple enough, but of course, it is not. The most obvious addition to the dimensions of the gender of the mind (which matches sex chromosomes in androngeous individuals surgically modified in infancy, and contradicts it in transgender individuals) and the gender of the body, is sexual orientation, which is crudely, if functionally summed up in the notion of sexual attraction, but is quite a bit more complex.
A gay man is not really even remotely the same thing as a male to female transgender individual, even though gender atypical behavior in both at an age consistent with the trait being congenital is very common. A gay man doesn't generally feel internally that he is a woman (although a transgender gay man is a conceptual, if extremely rare, possibilty), and a lesbian woman doesn't generally feel internall that she is a man. Homosexual and hetrosexual sexual orientation would seem to leave four kinds of self-concepts, gay male, straight male, lesbian female, straight female. But, in fact, sexual orientation isn't as simple as a binary thing. There are quite a few non-straight women, and not as many non-straight men, who have stable bisexual identities. There is some sense that there is stability in the characterization of butch or femme lesbian, and an analogous distinction for gay men, although what is going on in these contexts has as much basis in the intuition of people who live in the situation as it does in any consensus description of the reality.
The whole sexual orientation concept also turns out to be far more deep rooted than one might expect, and in some cases very simple. One can flip a genetic switch in a fruit fly or mouse and make him gay. Blamo, scientists have identified single tweaks in single biological systems that will do the job every time. Apparently, our genes carry both male and female instruction books on instictual gendered behavior in one or more domains (including, of course, sex), but generally we only have the fortune, or misfortune, to have access to just one of those sets of gender programing in our lives.
There are continuum and binary notions of sexual orientation. It isn't at all obvious that what we call sexual orientation in men and what we call sexual orientation in women are precisely equivalent concepts flipped only by a body gender-mind gender coupling to sexual orientation. There are scholars, I'll call them gender theorists for want of a better term, who think that what is going on in bisexuality, in particular, is very different between men and women, and that sexual orientation is more binary in men than it is in women. It also isn't at all clear whether there is one master "sexual orientation switch" that is behind all of this, or if multiple mechanism lead someone to consider himself, for example, to be a gay man, and all of the different categories of people who consider themselves to be gay men seem to be in one group simply because the phenotypes are similar enough to be compatably treated that way and we don't really understand what is going on.
But, anyway, in addition to the point that sexual orientation is a much more conceptually fraught thing than cis- versus trans- gender identity, there is the point that there is more to sexual orientation than attraction, and that a gay man is very much not, for example, either a straight man or a straight woman.
Then, there is the question of whether a transgender identity is really binary. In an extreme, obvious kind of case, like the one described in the Boston Globe; the archaetypal case, it is that simple. But, what about tom boys who still unambiguously think of themselves as women and are attracted to boys, and what about men who have some steroetypically feminine interests or personality traits but unambiguously see themselves as male and are attracted to women. Is this different in kind than what we see in transgender individuals, or just different in degree? Is there any deep down commonality between someone who cross-dresses for shits and grins with their same gender pals because that is normal for their culture, and someone who cross-dresses because it reflects their conception of who they are as an individual deep down?
And, all of this doesn't yet address the question of people whose bodies are androgynous or whose genes have extra chromosomes (or lack chromosomes) associated with one gender or the other. Furthermore, don't forget people who are hormonally neutered in some way (e.g., castration, disease, chemically), who themselves differ based on the point in life at which this happens, and differing cultural roles for men and women.
One starts out with an extremely two bin system that explains 90% of reality, and before you know it, you've got a blur of concepts - chromosomonal gender, hormonal gender, body phenotype gender, self-perception gender, attraction gender, personality style and inclination gender, and other blends and mashup of these dimensions.
Managing Daily Life Like A Decent Person
Practically speaking, modern, reasonably tolerant people tread cautiously, take people's self-identity at face value, and do what is practical to realize workable arrangements that make everyone happy. this works quite well in real life, respects the dignity and worth of everyone involved, makes people happy most of the time, and has the virtue of not necessitating an understanding of precisely how any of it works, which we don't have available to us. And, people who haven't happened upon that realization cling to the two bin classification system, try to fit everyone into it, and reserve words like disgusting and abomination to anyone who is a round peg that won't fit in a square hole. But, the writing is on the wall in the Western world and the people in the first category are becoming culturally dominant in a transformation that has already been dramatic in basically two generations.
Post-puberty, without medical intervention, trying to follow the "go with the flow" game plan all gets much more inconvenient for transgender indiviudals. Puberty brings about irreversable changes in a person's body, and bringing about some sort of congruity between the gender identity of the mind, which transgender individuals usually want to have honored in daily life, and the way one presents at first glance, can be a devilishly difficult matter to manage, particularly so in the male to female dimension, since it is in practice easier for a woman's body to pass for not particularly masculine young man or old boy, than it is for a very masculine man's body to pass for a woman's.
Sexual orientation, which doesn't have the same kind of disconnect between your body and who you perceive yourself to be, doesn't post the same kinds of problems. A gay man may have a different instinctual playbook than a straight man or a straight woman, but he generally doesn't want anyone to treat him entirely as a woman, so there isn't the same need to tinker with one's body physically via medical professionals.
Looking forward, the big questions in my mind are whether our conceptual framework for these concepts will become better defined at some point in an accurate way, whether we will every learn how this comes to be from a mechanism point of view, and how our culture will continue to adapt.
As they say, interesting times.
If you've read growing up stories about transgender children, this story in the Boston Globe, about twins in Maine (purportedly identical twins), one of whom is transgender, and the other of whom is not, rings true and is extremely familiar. This post recaps a lot of the same issues I addressed with more research rigor three years ago in response to some news stories in Colorado, and covers a lot of the same grounds, with the exception of the data point provided by the identical twin aspect of the Boson story.
Questions Of How and Why
In some ways, the notion that the two identical twins have such different personality is more notable than that they have different gender identity. While it isn't safe to generalize, certain most of the time transgender involves having XY genes and feeling certain that you are a girl, or having XX genes and feeling certain that you are a boy. Ergo, there is nothing conceptually impossible about genetically identical people not having identical gender identity.
But, twins aren't just clones of each other - genetically identical people who may be born to different gestational mothers at different points in time. Not only are they genetically identical, they also gestated in the same womb at the same time. And, yet, almost uniformly in the instances I've heard described, a conclusion that someone has a transgender identity manifests in a way that is almost impossible to ignore, even if you try very hard to do so, by preschool age - the article says the matter was absolutely undeniable by age four and manifested to some extent well before that point. And, given how difficult it is to make any sense of what infants are about in personality beyond one or two very basic dimensions, the inference that a transgender identity is probably congentital, even though it is probably not genetic (or at least, is probably not exclusively genetic) is a strong one.
The typicality of the case that the Boston Globe describes, in just one of two identical twins, suggests just a few possibilities.
1. Something within the gestational environment was different for one twin than the other, even though they were in the same womb. Thus, gestitational microenvironment might be involved. Maybe there was a different hormone balance at one end of the womb than the other at a critical moment for some reason like a residual estrogen accumulation from oral contraceptives taken at some point, or maybe a well placed kick to one of them during gestation took out the "turn into a male" circuit in one child but not the other by physically damaging it.
2. Something within the twining process wasn't perfectly symmetrical. Maybe one of the twins is a chimera of a lost fraternal triplet and the living twin, and the other is not, but genetic testing was at a locus where only the fraternal twin's genetic trace was detectable. Maybe there was a random hiccup in a key male or female identity moment of the development process that 99.99% of the time matches the genetic rule book but sometimes, in a rare process akin to a mutation but involved in the expression of that genome (perhaps an epigenetic mutation), there is a departure from the plan.
3. The trigger to a transgender identity happens post-natally in early childhood for who knows what reasons, perhaps related to some environmental exposure that happened to one child but not the other - maybe it was something not so unlike spiderman, maybe a mosquito carrying a particular rare version of a virus bit one and not the other, or bit both but only made it past the immune system of one of them due to something as random as having a cold at the time.
For what it's worth, if I had to, I'd put my money on an epigenetic mutation of unknown origin during gestation, quite possibly limited to neural epigenetics, as the likely cause, but I wouldn't bet the farm on any one of those options. My thought is that if there was a one time hormone exposure (which is possibly a more plausible mechanism for sexual orientation) that the XY genes would reassert themselves to some extent, albeit "out of tune."
For example, the notion that there might be a rare gene that makes it possible for the epigenetic mutation to happen, and that if that gene is present that the odds of an epigenetic mutation actually happening are one in six or something like that, is somewhat attractive, although I've near heard of transgender identities running in families in any of the literature on the subject.
Making Sense Of The More Complicated Than It Seems Gender Concept
All of this makes clear that the more subtle aspects of gender are real and inherent in people from some very early point in life, not simply a product of social conditions and environmental cues. I don't think that anyone who has seriously looked at the efforts that have been taken scientifically to determine if that is the case disagrees with that position at this point, although there are certainly differences in degree.
The conclusion may seem obvious, but after being taken for granted in a far simpler, two bin theory of gender that has been predominant for a lot of the time for a lot of history in a lot of cultures, from the 1960s through roughly the 1980s, the assumption that the aspects of gender pertaining to the mind were predominantly environmental and social in origin had a lot of currency.
Yet, the reality of transgender individuals is for gender what muons are for physics, something that nobody ordered or expected but that happens to exist. This reality takes nice simple grand unified theories of what gender is that fit 99.99% of the data and blows them out of the water. Sorry, Nature is telling us, explaining the last 0.01% (and these numbers are meant merely in the sense of very small number, not a specific actual value), is going to take a vastly more complex theory, but that is the reality of gender identity in the real world.
One can imagine a universe in which there are transgender and cisgender individuals. Indeed, in a lot of ways transgender identity is a much simpler to understand concept than the various concepts associated with sexual orientation. You have male hardware and genes but you mind and whole being insists that you are female, or visa versa.
Indeed, the profiles of people who are born androgonous but are genetically male, who are surgically modified in infancy to appear physically female and are raised female are remarkably similar to those of transgender individuals. The surgery never, or almost never, works, and despite all parental efforts the child made to look like and raised like a girl feels like a boy deep inside and nothing anyone can do can stop that train.
If you are willing to put the mechanism by which transgender identity happens in a black box (and you pretty much have to, in practice, because all of the usual suspects are ruled out) and simply get comfortable with the fact that there is a mechanism that isn't any of the usual suspects and that the mechanism in question is the one that really matters, it is all very straightforward to grasp.
Most of the cases described under the header of transgender identity fall neatly into a binary notion of gender. There just happens to be a mind-body discontinuity in these individuals, and since the mechanism by which sex chromosomes translate to gene expression in the body seems to be almost entirely mediated by sex hormones in the time period after birth, interrupting that process seems to be quite straightforward in theory, even if timing and technique require some doing.
If that were all there was to the story of gender it would be simple enough, but of course, it is not. The most obvious addition to the dimensions of the gender of the mind (which matches sex chromosomes in androngeous individuals surgically modified in infancy, and contradicts it in transgender individuals) and the gender of the body, is sexual orientation, which is crudely, if functionally summed up in the notion of sexual attraction, but is quite a bit more complex.
A gay man is not really even remotely the same thing as a male to female transgender individual, even though gender atypical behavior in both at an age consistent with the trait being congenital is very common. A gay man doesn't generally feel internally that he is a woman (although a transgender gay man is a conceptual, if extremely rare, possibilty), and a lesbian woman doesn't generally feel internall that she is a man. Homosexual and hetrosexual sexual orientation would seem to leave four kinds of self-concepts, gay male, straight male, lesbian female, straight female. But, in fact, sexual orientation isn't as simple as a binary thing. There are quite a few non-straight women, and not as many non-straight men, who have stable bisexual identities. There is some sense that there is stability in the characterization of butch or femme lesbian, and an analogous distinction for gay men, although what is going on in these contexts has as much basis in the intuition of people who live in the situation as it does in any consensus description of the reality.
The whole sexual orientation concept also turns out to be far more deep rooted than one might expect, and in some cases very simple. One can flip a genetic switch in a fruit fly or mouse and make him gay. Blamo, scientists have identified single tweaks in single biological systems that will do the job every time. Apparently, our genes carry both male and female instruction books on instictual gendered behavior in one or more domains (including, of course, sex), but generally we only have the fortune, or misfortune, to have access to just one of those sets of gender programing in our lives.
There are continuum and binary notions of sexual orientation. It isn't at all obvious that what we call sexual orientation in men and what we call sexual orientation in women are precisely equivalent concepts flipped only by a body gender-mind gender coupling to sexual orientation. There are scholars, I'll call them gender theorists for want of a better term, who think that what is going on in bisexuality, in particular, is very different between men and women, and that sexual orientation is more binary in men than it is in women. It also isn't at all clear whether there is one master "sexual orientation switch" that is behind all of this, or if multiple mechanism lead someone to consider himself, for example, to be a gay man, and all of the different categories of people who consider themselves to be gay men seem to be in one group simply because the phenotypes are similar enough to be compatably treated that way and we don't really understand what is going on.
But, anyway, in addition to the point that sexual orientation is a much more conceptually fraught thing than cis- versus trans- gender identity, there is the point that there is more to sexual orientation than attraction, and that a gay man is very much not, for example, either a straight man or a straight woman.
Then, there is the question of whether a transgender identity is really binary. In an extreme, obvious kind of case, like the one described in the Boston Globe; the archaetypal case, it is that simple. But, what about tom boys who still unambiguously think of themselves as women and are attracted to boys, and what about men who have some steroetypically feminine interests or personality traits but unambiguously see themselves as male and are attracted to women. Is this different in kind than what we see in transgender individuals, or just different in degree? Is there any deep down commonality between someone who cross-dresses for shits and grins with their same gender pals because that is normal for their culture, and someone who cross-dresses because it reflects their conception of who they are as an individual deep down?
And, all of this doesn't yet address the question of people whose bodies are androgynous or whose genes have extra chromosomes (or lack chromosomes) associated with one gender or the other. Furthermore, don't forget people who are hormonally neutered in some way (e.g., castration, disease, chemically), who themselves differ based on the point in life at which this happens, and differing cultural roles for men and women.
One starts out with an extremely two bin system that explains 90% of reality, and before you know it, you've got a blur of concepts - chromosomonal gender, hormonal gender, body phenotype gender, self-perception gender, attraction gender, personality style and inclination gender, and other blends and mashup of these dimensions.
Managing Daily Life Like A Decent Person
Practically speaking, modern, reasonably tolerant people tread cautiously, take people's self-identity at face value, and do what is practical to realize workable arrangements that make everyone happy. this works quite well in real life, respects the dignity and worth of everyone involved, makes people happy most of the time, and has the virtue of not necessitating an understanding of precisely how any of it works, which we don't have available to us. And, people who haven't happened upon that realization cling to the two bin classification system, try to fit everyone into it, and reserve words like disgusting and abomination to anyone who is a round peg that won't fit in a square hole. But, the writing is on the wall in the Western world and the people in the first category are becoming culturally dominant in a transformation that has already been dramatic in basically two generations.
Post-puberty, without medical intervention, trying to follow the "go with the flow" game plan all gets much more inconvenient for transgender indiviudals. Puberty brings about irreversable changes in a person's body, and bringing about some sort of congruity between the gender identity of the mind, which transgender individuals usually want to have honored in daily life, and the way one presents at first glance, can be a devilishly difficult matter to manage, particularly so in the male to female dimension, since it is in practice easier for a woman's body to pass for not particularly masculine young man or old boy, than it is for a very masculine man's body to pass for a woman's.
Sexual orientation, which doesn't have the same kind of disconnect between your body and who you perceive yourself to be, doesn't post the same kinds of problems. A gay man may have a different instinctual playbook than a straight man or a straight woman, but he generally doesn't want anyone to treat him entirely as a woman, so there isn't the same need to tinker with one's body physically via medical professionals.
Looking forward, the big questions in my mind are whether our conceptual framework for these concepts will become better defined at some point in an accurate way, whether we will every learn how this comes to be from a mechanism point of view, and how our culture will continue to adapt.
As they say, interesting times.
Financial Crisis Recap And Anti-Unemployment Policies
* The Swedish government effort to help a local company save Saab when it faced shut down after it was spun off by General Motors failed.
* The biggest mistake of the financial crisis, in cost to the taxpayer that the taxpayer isn't benefitting from is the bailout of Fannie Mae and Freddie Mac. There was no legal obligation of the U.S. government to do it. It did let the shareholders of that privately owned, but government chartered firm lose most of their investments, but it could easily have put the two firms into Chapter 11 bankruptcies or the equivalent, let bondholders rather than taxpayers take the $160 billion +/- haircut that exceeds the cost of all the other bailouts and some of the most notable stimulus programs combined, moral hazards would have been reduced, and the bondholders of Fannie Mae and Freddie Mac would have still gotten a decent share of their investment back, maybe not 100% with interest, but a pretty large percentage. Instead, in part, because of the bailout, we have some of the lowest mortgage interest rates in memory but far fewer borrowers that lenders trust to actually extend credit to in the first place. If those two institutions had busted, we might have 6% mortgage interest rates rather than 4% mortgage interest rates, but banks might be more willing to lend at that rate and either way there would be record low single family residential housing investment.
* Other programs that have done very little good have been the mortgage modification programs, the cars for clunkers program, and the homebuyer's tax credit. The way to have done mortgage modifcation would have been to allow cramdowns in bankruptcy for residences, that would have forced banks doing business in the shadow of that reality to compromise because it was in their interest to do so. The other two programs merely shifted the timing of major purchases by people who were already going to make them by a few months and were almomst completely counterbalanced macroeconomically by post-program slumps.
* There were good responses too. The government backing of privately insured money market funds when a single instance of one "breaking the buck" threatened a run on that entire shadow credit industry worked just like a scene out of "it's a wonderful life." The FDIC has performed brilliantly throughout. Extending unemployment benefits and allowing laid off employee paperwork free COBRA subsidies worked so well that we should consider making both programs into permanent automatic stabilizers and part of our social safety net.
* A monumental mistake has been the resort in the U.S. and abroad to government austerity programs that have laid off government employees at a time when we need economic stimulus, not what Krugman has called big and little Hoovers. The notion that government doesn't create jobs is nonsense. Somebody with a job is employed, someone without one is not, and dumping people into unemployment lines (that government is out of pocket for to some extent anyway) during periods of high unemployment and rising demand for government services is nonsense and defies lots of empirical economic evidence on the subject. The time to trim government payrolls is when private industry has better uses for those employees, not when it is suffering from a failure to see profitable things for people to do. We should be hiring teachers when people take advantage of a time when the private sector no longer wants their skills and they need to retool by going back to school, not firing them. Increased leniency on student loans, however, has been good policy. The more people go back to school, the fewer people there are in the workforce, and the lower unemployment will be as a result. And, when the economy comes back will have increased the capacity of our workforce.
* We should be creating more entry levels jobs in the Army, where there is a legitimate military reason to create them because the current force structure in two modest regional wars had the effect of putting rank and file soldiers have been put in rotations that are grossly too long and too frequent, not eliminating them to cut the defense budget - if we are going to cut the defense budget in a way that is sensitive to the health of the economy, we should be postpone big ticket purchases of weapons system that create few jobs per dollar spent and focusing on hiring soldiers and civilian support personnel which is a much better value in jobs per dollars spent. And, honestly, we can afford to postpone big ticket purchases on weapons systems because there is no looming conflict that requires them against a plausible opponent in the relevant time frame.
* We should stop trying to backfill active duty military force shortages with reservists and national guardsmen who have jobs, and instead establish a policy of meeting the entire active duty military force with active duties soldiers and sailors.
* We should prefer postage increases and generous pension overpayment settlements with the USPS to postal service layoffs and service reductions. Get it over with and give us the 50 cent first class stamp already. Subsidize universal service for the time being at least and think about cutting that subsidy when jobs are abundant, not when they are scarce.
* If the financial sector is recovering and the employment sector is not, it makes no sense to push for tax incentives that favor investment income over earned income. At times of high unemployment, we want incentives to employ, not incentives to automate.
* There are other no brainer ways to reduce the work force and free up jobs. For example:
- Use grants to replace the funds students get from work study, so that people who aren't almost out of the workforce anyway don't have to take those scarce entry level jobs.
- Increase the mandatory school attendance age for teenagers, which reduces no high school dropout entrants to the labor force and creates jobs for truant officers.
- Tighten overtime enforcement and overtime laws that employers don't give in to the temptation to simply overwork the hourly employees they have (potential hourly employees are far more likely to be unemployed than salaried ones), and instead hire new workers to do the work they need to get done.
- Subsidize unemployment programs that are seeing a surge in premiums in high turnover industries as claims rise so that businesses that would otherwise hire lots of people aren't discouraged from doing so.
- Temporarily waive penalties for early retirement under Social Security and public employee pension programs.
- Temporarily waive penalties for early retirement under tax favored defined contribution and defined benefit private retirement arrangements.
- Strengthen Family and Medical Leave Act enforcement that makes it possible to take unpaid leaves of absence.
- Slow down discretionary parole releases (which both supports prison employment and reduces the number of new entrants to the labor force).
- Shift jobs that are now part of programming for people who are in prison to people who are on parole or in halfway houses and would otherwise be part of the labor force.
- Allow longer time period installment payment plans and easier offer in compromise terms based on inability to pay for back tax debts for employers at risk of going out of business.
- Increase child tax credits while decreasing child care tax credits so that the tax incentive to work rather than staying at home with children is weakened.
- Relax expectations that beneficiaries of disability benefits like SSI and Social Security disability must meet in regard to trying to find employment. At times of high employment, we're better off if people who are willing to simply collect benefits without seeking employment do so.
- Put government program automation projects on hold. They cost a lot of money that creates few jobs, since tech employees are high wage, in areas where private industry is hiring because they have to cut their payrolls and put people out of work when their completed.
- Reduce the availability of temporary work visas for jobs that are unlikely to create secondary jobs like nannies and seasonal workers at ski resorts.
- Tighten enforcement of work prohibitions for people on student visas.
- Tighten limitations on double dipping in public employee retirement systems.
- Increase the taxation of Social Security benefits for people with earned income.
- Relax limitation on treating as dependents for tax purposes adult relatives who move in with family and aren't working or are only working part-time as dependents. Encourage family networks to buffer the intensity of the need to be in the workforce.
- Reduce employer tax risk related to tipped employees by treating tips as self-employment income rather than wages and salary. Tipped employees are among the easiest to create jobs for.
- Relax or clarify and publicize exceptions from minimum wage rules for commissioned employees and piece workers so employers can reduce the economic risk associated with hiring more people.
* To the extent possible, support a weak dollar in foreign currency markets, or at least, do nothing to try to strengthen the dollar. A weak dollar creates export jobs and reduces offshoring of employment via imports.
* Tighten legimate, non-tariff customs enforcement in any area that could undermine domestic employment, such as illegal imports of trademark violating knockoffs, and examination of health and safety issues for cheap imported products. This also creates customs enforcement jobs.
* Embrace growing industries like the medical marijuana industry, rather than cracking down on it.
* Develop policies that free up the mobility of people who are prevented from moving to available jobs by factors like upside down mortgages. For example, establish a right to short sell a residence without causing the loan to be called, or incurring any penalties, so long as the unpaid unsecured balance is paid.
* Use national law to discourage and weaken non-competition clauses in employment contracts that reduce the capacity of workers to go where the jobs are and have been convincingly been shown to reduce the aggregate economic health of the tech industry.
* Curtail limitations on performance rights for performable intellectual property like plays and songs. For example, strengthen the right to perform "covers" without IP owner consent by making the royalty inversely proportional to the age of the IP. Thus, the mandatory license fee for a twenty year old work would be half the mandatory license fee for a ten year old work. Buy back IP that is not currently generating significant revenues for its owners and orphan IP at discounted rates, since the transaction costs of dealing with these IP owners interferes with creative industry job creation. Create a new cottage industry by creating a right to translate old untranslated works and works that have been out of print for long periods of time at similar statutory royalty rates.
* Reduce filing fees and pre-filing procedural bars to bankruptcy (like credit counseling and the requirement the pleadings be completed pre-petition) that discourage hopelessly behind debtors from acting in an economically rational way and leave assets tied up in suboptimal uses. The increased viability of the bankruptcy threat also encourages banks to act reasonably outside of bankruptcy.
* Develop a right to provide add a reason like a loss of job or health crisis to a credit report so that future lenders can distinguish between spendthrifts and people who are merely unlucky.
* Allow charitable tax deductions for allowing a structure to be used as practice by fire departments thereby decreasing the supply of a glutted resource (buildings).
* Ease rules on tax loss carrybacks that would allow businesses that are struggling after having once been profitable to have a greater chance of surviving and preserving jobs in the process.
* The biggest mistake of the financial crisis, in cost to the taxpayer that the taxpayer isn't benefitting from is the bailout of Fannie Mae and Freddie Mac. There was no legal obligation of the U.S. government to do it. It did let the shareholders of that privately owned, but government chartered firm lose most of their investments, but it could easily have put the two firms into Chapter 11 bankruptcies or the equivalent, let bondholders rather than taxpayers take the $160 billion +/- haircut that exceeds the cost of all the other bailouts and some of the most notable stimulus programs combined, moral hazards would have been reduced, and the bondholders of Fannie Mae and Freddie Mac would have still gotten a decent share of their investment back, maybe not 100% with interest, but a pretty large percentage. Instead, in part, because of the bailout, we have some of the lowest mortgage interest rates in memory but far fewer borrowers that lenders trust to actually extend credit to in the first place. If those two institutions had busted, we might have 6% mortgage interest rates rather than 4% mortgage interest rates, but banks might be more willing to lend at that rate and either way there would be record low single family residential housing investment.
* Other programs that have done very little good have been the mortgage modification programs, the cars for clunkers program, and the homebuyer's tax credit. The way to have done mortgage modifcation would have been to allow cramdowns in bankruptcy for residences, that would have forced banks doing business in the shadow of that reality to compromise because it was in their interest to do so. The other two programs merely shifted the timing of major purchases by people who were already going to make them by a few months and were almomst completely counterbalanced macroeconomically by post-program slumps.
* There were good responses too. The government backing of privately insured money market funds when a single instance of one "breaking the buck" threatened a run on that entire shadow credit industry worked just like a scene out of "it's a wonderful life." The FDIC has performed brilliantly throughout. Extending unemployment benefits and allowing laid off employee paperwork free COBRA subsidies worked so well that we should consider making both programs into permanent automatic stabilizers and part of our social safety net.
* A monumental mistake has been the resort in the U.S. and abroad to government austerity programs that have laid off government employees at a time when we need economic stimulus, not what Krugman has called big and little Hoovers. The notion that government doesn't create jobs is nonsense. Somebody with a job is employed, someone without one is not, and dumping people into unemployment lines (that government is out of pocket for to some extent anyway) during periods of high unemployment and rising demand for government services is nonsense and defies lots of empirical economic evidence on the subject. The time to trim government payrolls is when private industry has better uses for those employees, not when it is suffering from a failure to see profitable things for people to do. We should be hiring teachers when people take advantage of a time when the private sector no longer wants their skills and they need to retool by going back to school, not firing them. Increased leniency on student loans, however, has been good policy. The more people go back to school, the fewer people there are in the workforce, and the lower unemployment will be as a result. And, when the economy comes back will have increased the capacity of our workforce.
* We should be creating more entry levels jobs in the Army, where there is a legitimate military reason to create them because the current force structure in two modest regional wars had the effect of putting rank and file soldiers have been put in rotations that are grossly too long and too frequent, not eliminating them to cut the defense budget - if we are going to cut the defense budget in a way that is sensitive to the health of the economy, we should be postpone big ticket purchases of weapons system that create few jobs per dollar spent and focusing on hiring soldiers and civilian support personnel which is a much better value in jobs per dollars spent. And, honestly, we can afford to postpone big ticket purchases on weapons systems because there is no looming conflict that requires them against a plausible opponent in the relevant time frame.
* We should stop trying to backfill active duty military force shortages with reservists and national guardsmen who have jobs, and instead establish a policy of meeting the entire active duty military force with active duties soldiers and sailors.
* We should prefer postage increases and generous pension overpayment settlements with the USPS to postal service layoffs and service reductions. Get it over with and give us the 50 cent first class stamp already. Subsidize universal service for the time being at least and think about cutting that subsidy when jobs are abundant, not when they are scarce.
* If the financial sector is recovering and the employment sector is not, it makes no sense to push for tax incentives that favor investment income over earned income. At times of high unemployment, we want incentives to employ, not incentives to automate.
* There are other no brainer ways to reduce the work force and free up jobs. For example:
- Use grants to replace the funds students get from work study, so that people who aren't almost out of the workforce anyway don't have to take those scarce entry level jobs.
- Increase the mandatory school attendance age for teenagers, which reduces no high school dropout entrants to the labor force and creates jobs for truant officers.
- Tighten overtime enforcement and overtime laws that employers don't give in to the temptation to simply overwork the hourly employees they have (potential hourly employees are far more likely to be unemployed than salaried ones), and instead hire new workers to do the work they need to get done.
- Subsidize unemployment programs that are seeing a surge in premiums in high turnover industries as claims rise so that businesses that would otherwise hire lots of people aren't discouraged from doing so.
- Temporarily waive penalties for early retirement under Social Security and public employee pension programs.
- Temporarily waive penalties for early retirement under tax favored defined contribution and defined benefit private retirement arrangements.
- Strengthen Family and Medical Leave Act enforcement that makes it possible to take unpaid leaves of absence.
- Slow down discretionary parole releases (which both supports prison employment and reduces the number of new entrants to the labor force).
- Shift jobs that are now part of programming for people who are in prison to people who are on parole or in halfway houses and would otherwise be part of the labor force.
- Allow longer time period installment payment plans and easier offer in compromise terms based on inability to pay for back tax debts for employers at risk of going out of business.
- Increase child tax credits while decreasing child care tax credits so that the tax incentive to work rather than staying at home with children is weakened.
- Relax expectations that beneficiaries of disability benefits like SSI and Social Security disability must meet in regard to trying to find employment. At times of high employment, we're better off if people who are willing to simply collect benefits without seeking employment do so.
- Put government program automation projects on hold. They cost a lot of money that creates few jobs, since tech employees are high wage, in areas where private industry is hiring because they have to cut their payrolls and put people out of work when their completed.
- Reduce the availability of temporary work visas for jobs that are unlikely to create secondary jobs like nannies and seasonal workers at ski resorts.
- Tighten enforcement of work prohibitions for people on student visas.
- Tighten limitations on double dipping in public employee retirement systems.
- Increase the taxation of Social Security benefits for people with earned income.
- Relax limitation on treating as dependents for tax purposes adult relatives who move in with family and aren't working or are only working part-time as dependents. Encourage family networks to buffer the intensity of the need to be in the workforce.
- Reduce employer tax risk related to tipped employees by treating tips as self-employment income rather than wages and salary. Tipped employees are among the easiest to create jobs for.
- Relax or clarify and publicize exceptions from minimum wage rules for commissioned employees and piece workers so employers can reduce the economic risk associated with hiring more people.
* To the extent possible, support a weak dollar in foreign currency markets, or at least, do nothing to try to strengthen the dollar. A weak dollar creates export jobs and reduces offshoring of employment via imports.
* Tighten legimate, non-tariff customs enforcement in any area that could undermine domestic employment, such as illegal imports of trademark violating knockoffs, and examination of health and safety issues for cheap imported products. This also creates customs enforcement jobs.
* Embrace growing industries like the medical marijuana industry, rather than cracking down on it.
* Develop policies that free up the mobility of people who are prevented from moving to available jobs by factors like upside down mortgages. For example, establish a right to short sell a residence without causing the loan to be called, or incurring any penalties, so long as the unpaid unsecured balance is paid.
* Use national law to discourage and weaken non-competition clauses in employment contracts that reduce the capacity of workers to go where the jobs are and have been convincingly been shown to reduce the aggregate economic health of the tech industry.
* Curtail limitations on performance rights for performable intellectual property like plays and songs. For example, strengthen the right to perform "covers" without IP owner consent by making the royalty inversely proportional to the age of the IP. Thus, the mandatory license fee for a twenty year old work would be half the mandatory license fee for a ten year old work. Buy back IP that is not currently generating significant revenues for its owners and orphan IP at discounted rates, since the transaction costs of dealing with these IP owners interferes with creative industry job creation. Create a new cottage industry by creating a right to translate old untranslated works and works that have been out of print for long periods of time at similar statutory royalty rates.
* Reduce filing fees and pre-filing procedural bars to bankruptcy (like credit counseling and the requirement the pleadings be completed pre-petition) that discourage hopelessly behind debtors from acting in an economically rational way and leave assets tied up in suboptimal uses. The increased viability of the bankruptcy threat also encourages banks to act reasonably outside of bankruptcy.
* Develop a right to provide add a reason like a loss of job or health crisis to a credit report so that future lenders can distinguish between spendthrifts and people who are merely unlucky.
* Allow charitable tax deductions for allowing a structure to be used as practice by fire departments thereby decreasing the supply of a glutted resource (buildings).
* Ease rules on tax loss carrybacks that would allow businesses that are struggling after having once been profitable to have a greater chance of surviving and preserving jobs in the process.
21 December 2011
Rolo The Dog Remembered
It happened a year and a half ago, but Rolo the dog, whose owner I represented in an appeal while the dog was on doggie death row (successfully) died in the summer of 2010, about two and a half years later than he would have had he been euthenized, at the age of eight. Farewell, Rolo.
Doug Bruce Convicted Of Felony Tax Fraud and Attempted Bribery
Colorado Pols summarizes the breaking news regarding Taxpayer Bill of Rights initiative (TABOR) author and former state legislator and county commissioner Doug Bruce's felony tax fraud and attempted bribery conviction this afternoon. He was convicted of not reporting about $190,000 of interest earned by a sham non-profits that he used as his own funds over a three years period (2005-2007).
Bruce's pro se defense (he is legally trained and was a deputy district attorney in California for six years, but has never been admitted to practice in Colorado and chose to represent himself in this case), was in typical Bruce style, "unconventional" a.k.a. delusional. He acted like a tax protester who didn't respect the court rather than someone making a bona fide claim of innocence of the charges against him.
Bruce faces up to six years in prison and a hefty fine at a February 13, 2012 sentencing date, in addition to any civil liability he may have for unpaid state taxes, interest and penalties. Of course, the Court would also have any number of other sanctions available to it at sentencing, such as probation. Leniency wouldn't be uncommon for a non-violent, white collar crime defendant with no meaningful criminal record (in 1995, he served eight days in jail for contempt of court), and a record of public service and civic involvement. But, the nature of his defense and his unwillingness to accept responsibility or even to acknowledge the wrongfulness of his actions makes this less likely in his case than in other white collar criminal cases.
An appeal from Bruce is almost certain, but is unlikely to prevail.
The prosecution was made in state court, but the federal government has every right to prosecute him on nearly identical civil and criminal federal tax evasion charges if it wishes to do so.
Bruce tried to evade subpoenas and faced investigations related to civil campaign finance non-disclosure charges in 2010. He was ultimately not held in contempt of court in September, 2010, after a several day long trial in which he was represented by an attorney, although he was ordered to provide testimony in that case. In December of 2010, in the same case, a charity he founded ("Active Citizens Together") was fined $11,300 for campaign finance violations in connection undisclosed initiative contribution.
He has also recently been accused of engaging in the unauthorized practice of law in Colorado and served with an order to show cause why an injunction requiring him to refrain from doing should not enter in June of 2011, while he was representing himself in a TABOR related lawsuit that he brought. He filed a bombastic answer in the case, Colorado Supreme Court case no. 10UPL058 aka case no. 11SA154, on July 7, 2011. The civil Colorado Supreme Court case in which a petition was filed on May 23, 2011, is currently pending against Bruce in the Colorado Supreme Court and requests fines as well as the injunction.
Bruce's pro se defense (he is legally trained and was a deputy district attorney in California for six years, but has never been admitted to practice in Colorado and chose to represent himself in this case), was in typical Bruce style, "unconventional" a.k.a. delusional. He acted like a tax protester who didn't respect the court rather than someone making a bona fide claim of innocence of the charges against him.
Bruce faces up to six years in prison and a hefty fine at a February 13, 2012 sentencing date, in addition to any civil liability he may have for unpaid state taxes, interest and penalties. Of course, the Court would also have any number of other sanctions available to it at sentencing, such as probation. Leniency wouldn't be uncommon for a non-violent, white collar crime defendant with no meaningful criminal record (in 1995, he served eight days in jail for contempt of court), and a record of public service and civic involvement. But, the nature of his defense and his unwillingness to accept responsibility or even to acknowledge the wrongfulness of his actions makes this less likely in his case than in other white collar criminal cases.
An appeal from Bruce is almost certain, but is unlikely to prevail.
The prosecution was made in state court, but the federal government has every right to prosecute him on nearly identical civil and criminal federal tax evasion charges if it wishes to do so.
Bruce tried to evade subpoenas and faced investigations related to civil campaign finance non-disclosure charges in 2010. He was ultimately not held in contempt of court in September, 2010, after a several day long trial in which he was represented by an attorney, although he was ordered to provide testimony in that case. In December of 2010, in the same case, a charity he founded ("Active Citizens Together") was fined $11,300 for campaign finance violations in connection undisclosed initiative contribution.
He has also recently been accused of engaging in the unauthorized practice of law in Colorado and served with an order to show cause why an injunction requiring him to refrain from doing should not enter in June of 2011, while he was representing himself in a TABOR related lawsuit that he brought. He filed a bombastic answer in the case, Colorado Supreme Court case no. 10UPL058 aka case no. 11SA154, on July 7, 2011. The civil Colorado Supreme Court case in which a petition was filed on May 23, 2011, is currently pending against Bruce in the Colorado Supreme Court and requests fines as well as the injunction.
Hungarian GOP-Clones Downgrade Their Democracy To U.S. Level
Paul Krugman has devoted several blog posts and a newspaper column in the New York Times to the political situation in Hungary.
Hard economic times have diminished popular support for democracy among the people of former Warsaw Pact member countries in Central and Eastern Europe (citing this Transition Report prepared by the European Bank for Reconstruction and Development.
In Hungary, where the electoral system made it possible for the center-right Fidesz party, which got 53% of the popular vote in the spring of 2010, allowing it to command 68% of the seats in parliament, making it possible for it to amend the constitution at will, a power that Fidesz has used liberally despite not having campaigned on a platform of radical constitutional reform.
The Fidesz Reform Compared To The American Democratic Standard
Many of the Fidesz reforms take "best democratic practices" provisions of the Hungarian constitution and legal system and replace them with less democratic American style practices, or in some cases, with provisions of the kind that are widely popular among U.S. Republicans, but have been thwarted, at least at the national level, politically or by the U.S. Supreme Court's interpretations of the U.S. Constitution. Here are some highlights from a guest post at Krugman's blog:
* Fidesz stripped the Constitutional Court of many of the powers it previously held (e.g. the power to review the constitutionality of laws in the abstract), leaving the Hungarian system of judicial review more anemic than the European norm and very similar to that of the United States where constitutional claims are subject to standing requirements that are particularly narrow in matters of public finance and must work there way through the court system rather than starting at the top. Fidesz also expanded the number of judges on the Constitutional Court and packed it with judges favorable to it.
* In another move to pack the judiciary, many sitting judges were forced out of office and will be replaced de facto life appointees hired by a new official appointed by their party:
This too has parallels to U.S. practice, which while it does not permit the removal of sitting judges from office, does allow for sudden expansions of the judicial ranks to allow the party in power to pack the courts.
* The same National Judicial Office which was given the power to appoint judges was also given "the power to move any sitting judge to a different court," and starting in 2012, "both the public prosecutor and the head of this new National Judicial Office to choose which judge will hear each case."
This step, in principle is unprecedented, in U.S. practice, although, in reality, choice of venue decisions made by prosecutors, intimate familiarity with how the process of assigning judges works, and the option of dismissing a case without prejudice if they don't like the judge and then refiling it gives prosecutors something closer to this ability in practice than is commonly acknowledged.
* Under the old political norms, "the five-member Election Commission to be politically diverse and for the government of the day to consult the opposition before nominating candidates." Now, the incumbents on that commission lose their offices following each new election, the winning party or coalition can (and in the case of Fidesz, has) appointed their own partisans to all of the seats on the Commission.
Thus, Hungary has retreated from the European norm of having non-partisan electoral administration to the American norm of having elections run by whatever partisan elected official prevailed in the last election. In the U.S. that official is typically called the Secretary of State at the state level and the County Clerk at the local level. There is no significant national level election administration in the United States.
* In a move that is classic in American politics, but unfamiliar to Europeans, Fidesz has gerrymandered the electoral districts in their favor; "using the new district boundaries [in the last three elections] . . . Fidesz would have won all three elections, including the two they actually lost."
* Fidesz has appointed partisan minded loyalists to posts in charge of "human rights, data protection and minority affairs", the "public prosecutor, the state audit office and, most recently, the Central Bank."
It is classic, American style, spoils to the victor political appointment politics.
* Content based media regulation has been instituted.
New "media laws created a new media board – staffed only by Fidesz party loyalists with a chair who is appointed by the Prime Minister to a nine-year term. This board can review all public and private media for their compliance with a nebulous standard of political “balance” and has the power to bankrupt any news organization with large fines. It is not surprising that the media have become self-censoring."
Basically, every media outlet in Hungary is now legally required to behave like Fox News. This is something that conservative Republicans in the U.S. can only dream of having, under constitutional law protections of the First Amendment freedom of the press that liberals and conservatives alike have upheld in the U.S.
* The party has enshrined conservative Christian social policy on abortion and gay rights and the status of the country as a Christian nation in the Constitution, despite the fact that only 21% of the population is religious, and limited official recognition of minority religions. Under the new constitution:
In other words, the new Hungarian constitution pretty much matches the American Republican party platform on religious and social issues.
* Supermajority requirements that Fidesz has put in the constitution make it hard for their policies to be undone if the lose control of parliament.
In other words, the Hungarian center-right party has created the equivalent of the filibuster powers of the minority in the U.S. Senate.
* They have given key political appointees long terms that could outlast their removal from office, subject only to impeachments by two-thirds majorities, much as the U.S. does for posts like the FBI director and the Federal Reserve:
* They have based the GOP pipe dream of a balanced budget amendment with an institutional means of being enforced: "a national budget council with the power to veto any future budget that adds to the national debt, which any foreseeable budget will do. The members of the budget council have been chosen by this government for terms of 6 or 12 years and can only be replaced if two-thirds of the parliament can agree on new candidates when their terms are over. Another part of the constitution requires the parliament to pass a budget by March 31 of each year. If the parliament fails to do so, the president of the country can dissolve the parliament and call new elections."
Of course, in states like Colorado, similar substantive rules exist, although the institutional means of implementing those rules is a bit different, and most U.S. states have some form of balanced budget requirement often enforceable via a line item veto.
* The door has been opened to banning certain extremist political parties on theories similar to the McCarthy era anti-communist laws in the United States:
It will also probably be made easier to prosecute communist era officials, and suppress the communist party, in a way that arguably and most troublingly opens the door to punitive sanctions of the main center-left opposition party arising from the Communist era regime:
Analysis
Opposition forces are not totally without a remedy.
Hungary is a party to a number of European treaties including the human rights regime of the Council of Europe which has the power to mandate Bill of Rights like protections for citizens of member nations, and these kinds of treaty obligations are not as easily ignored in Europe, where taking treaties seriously is a practical necessity, as it is in the United States where our legal system and constitution as interpreted are notoriously hostile to any form of international law, even when it is party to an international treaty.
Popular support in Hungary for the Fidesz party has also plummeted from a peak of more than 40% around the time of the last election to less than 20% now, although these voters now largely sit in the ranks of the "undecided" or "unaffiliated" rather than having cast their support to any of the other pre-existing major parties. And, in Hungary's electoral system, a drop in the popular vote for the Fidesz party would have a disproportionate effect on the number of parliamentary seats they win in the next election and could easily reduce the Fidesz party to less than a third of the seats in parliament if their unpopularity was sustained. The Fidesz party did not campaign on major entrenching constitutional reforms (and probably was surprised itself to get the majorities necessary to enact them).
Normally, securing two-thirds majority support for just about any kind of political change is extremely hard, but if Hungarian voters forcefully reject the direction Fidesz is taking Hungary's political system in the next election, it wouldn't be surprising if all of the other political parties in parliament could form a coalition united around promptly undoing some or all of the entrenching reformed enacted by Fidesz, which are a life or death threat to all of the other political parties in the country.
The kind of tactics Fidesz has engaged in parallel the anti-union overreaching that Republicans in Wisconsin engaged in when they took control there following the 2010 elections that produced a string of state legislator recall efforts, some successful, although not enough to immediately deprive Republicans of control of that state, and an effort to recall the Republican Governor with an unprecedented level of grass roots support(petitions will be submitted January 17, 2012 and there is a decent chance that they will have a sufficient number of signatures by then). Also, while the trend evidenced by the Fidesz reforms in Hungary are troubling and anti-democratic,I'm less inclined towards a "sky is falling" take on how they might work out in practice, because so many of those reforms represent an adoption of long standing U.S. political practice. They look so horrible mostly because the status quo in Hungary is so good. The reforms overwhelmingly adopt the most flawed components of the American political system, and some proposals that would have made the American political system even worse if adopted, but it isn't impossible to run a somewhat functional democracy on this basis. Also, while these reforms do appear to be entrenching many solidly conservative Fidesz officials in office, it doesn't appear to be the case that the appointees have flaws are any worse than being particularly partisan and conservative. The officials are not being entrenched with absolute control forever, a la the Ayatolla's theocrats in Iran, and do not appear to adhere to ideologies that are fundamentally at odds with the basic concept of multi-party democratic capitalism. These appear to be politically conservative reformers, not true revolutionaries or anti-democratic religious extremists or Nazis.
Fidesz wants to tip the odds in its favor for the short and medium term future and substantively bound the scope of the political discussion to ideologies that they deem acceptable, but they are basically chasing a shot at becoming a dominant party with decades of continous rule in the traditional of Japan's LDP or Mexico's PRI or FDR's Democratic party, rather than a fully authoritarian regime.
The fact that Fidesz has pulled this off, however, has troubling historical echos from Weimar Germany. Hungary's pre-reform constitution, like that of Weimar Germany, was a model of constitutional democracy. Hungary voters, like those of Weimar Germany, influenced by hard economic times, put the parliamentaries who are carrying out these reforms to the political system into office in free and fair elections and according to the legal process set forth in the validly adopted constitution, not by virtue of military force. But, ultimately Weimar Germany reached a point of no return that undid that democratic regime that it embodied and there is good reason to fear that history could repeat itself in Hungary.
In particular, the fear is that if the Fidesz reforms continue apace, and that neither European human rights institutions nor sharp voter backlash against Fidesz are quite strong enough to prevent the reforms from going to far for too long, that Hungary could reach a tipping point and take the few extra steps on the trendline it has already embarked upon towards a true right wing authoritarian regime.
If the reforms made so far by Fidesz are at least prevented from going any further and interpreted in ways that mute the worst slippery slope concerns they engender by enough Fidesz appointees who care enough about the overall welfare of a democratic state in Hungary to restrain their raw capacity to exercise political power at least somewhat, Hungary could settle into being a seriously flawed, but genuine democracy like the United States in due time.
But, if Fidesz can push much farther beyond the brink that it has already approached, and its appointees in key political positions aren't sufficiently fair minded in their exercise of the power that the reformed constitutional arrangements give them, the potential for Hungary to slip into becoming a conservative one party authoritarian state that ends up being a sort of mirror image of the one party Communist regime it was for several decades of the 20th century is very real and is deeply troubling for the future of Europe as a whole. And, without the kind of long standing democratic norms and political culture that the United States had in place for about a century in its capacity as a group of semi-autonomous British colonies, even before it established its current constitution in 1789, Hungary's odds of overcoming its current crisis of democratic government are not nearly high enough that we can be comfortable that it will all work out.
The United States and some European international institutions have expressed concern about the political developments in Hungary. Realistically, there isn't much that the United States can do about it, however, other than to express concern. As this post explains, most of the changes that Fidesz has put in place brings Hungary closer to the norms of the American system of government, and most of those that aren't a part of American politics have been regularly sought by one of the two main political parties in the United States, so the U.S. can't bring much moral authority to the situation at this point. European institutions have far more leverage in the situation, but in the end, it is hard to impose democracy on a public that isn't willing to use, at least, the formal legal and political rights that they have to preserve their democracy.
A preference for a Western European style democratic political system is not like a desire for food, water, clothing or shelter. It is a learned preference that has a lot of individual and collective utility if it is widely shared, but when you have an electorate who spent their formative years without that system, the public commitment to that system will not be as deep. People naturally gravitate towards thinking of what they know as what is just and right, and what most of the people of Hungary know is life under a one party authoritarian regime. People can change their preferences and new generations can develop preferences different from those of their predecessors. But, only time will tell if the Western European democratic political culture has taken hold firmly enough in the people of Hungary for its initially state of art democratic constitution to successfully facilitate permanent democratic government in Hungary in the face of economic hardship and shallow public commitment to it.
The optimist in me give some credence to the idea that the optimal level of democracy to produce a stable functional democratic system is the bare minimum necessary to earn the name democratic at all, and that beyond that additional democratic refinements add little benefit and may even be counterproductive. Hence, a system of democratic elections sufficiently great to make electoral politics more attractive than a military insurgency annd to make those who govern cognizant of the wishes of the governed is good enough, and extra bells and whistles, like initiative processes, proportional representation, and campaign finance reforms may do more harm, by making the process more complex, than they add in terms of the quality of the democratic process given that the bare minimum standards have been met.
The pessimist in me says that things are going from bad to worse in Hungary, and that is would be a crime to stand by and do nothing if there was anything we could do to prevent the current anti-democratic trend there from going too far. Perhaps that is why I am writing this post. But, I'm hard pressed to see anything that can be done, at least by Americans, that isn't already being done, or any room for a lasting solution that doesn't predominantly come from the Hungarians and perhaps institutions with which they have treaty relationships and obligations.
Hard economic times have diminished popular support for democracy among the people of former Warsaw Pact member countries in Central and Eastern Europe (citing this Transition Report prepared by the European Bank for Reconstruction and Development.
In Hungary, where the electoral system made it possible for the center-right Fidesz party, which got 53% of the popular vote in the spring of 2010, allowing it to command 68% of the seats in parliament, making it possible for it to amend the constitution at will, a power that Fidesz has used liberally despite not having campaigned on a platform of radical constitutional reform.
The Fidesz Reform Compared To The American Democratic Standard
Many of the Fidesz reforms take "best democratic practices" provisions of the Hungarian constitution and legal system and replace them with less democratic American style practices, or in some cases, with provisions of the kind that are widely popular among U.S. Republicans, but have been thwarted, at least at the national level, politically or by the U.S. Supreme Court's interpretations of the U.S. Constitution. Here are some highlights from a guest post at Krugman's blog:
* Fidesz stripped the Constitutional Court of many of the powers it previously held (e.g. the power to review the constitutionality of laws in the abstract), leaving the Hungarian system of judicial review more anemic than the European norm and very similar to that of the United States where constitutional claims are subject to standing requirements that are particularly narrow in matters of public finance and must work there way through the court system rather than starting at the top. Fidesz also expanded the number of judges on the Constitutional Court and packed it with judges favorable to it.
* In another move to pack the judiciary, many sitting judges were forced out of office and will be replaced de facto life appointees hired by a new official appointed by their party:
The government lowered the retirement age for judges from 70 to 62, giving judges only a few months to adjust to their new futures. More than 200 judges will be forced to retire from the bench starting on January 1, including most of the court presidents who assign cases and manage the daily workings of courts. The new law on the judiciary requires that the Supreme Court president have at least five years of Hungarian judicial experience. The current president of the Supreme Court is disqualified because his 17 years of experience as a judge on the European Court of Human Rights do not count. Therefore, he must leave office on January 1 also. The law on the judiciary also creates a new National Judicial Office with a single person at the helm who has the power to replace the retiring judges and to name future judges.
This too has parallels to U.S. practice, which while it does not permit the removal of sitting judges from office, does allow for sudden expansions of the judicial ranks to allow the party in power to pack the courts.
* The same National Judicial Office which was given the power to appoint judges was also given "the power to move any sitting judge to a different court," and starting in 2012, "both the public prosecutor and the head of this new National Judicial Office to choose which judge will hear each case."
This step, in principle is unprecedented, in U.S. practice, although, in reality, choice of venue decisions made by prosecutors, intimate familiarity with how the process of assigning judges works, and the option of dismissing a case without prejudice if they don't like the judge and then refiling it gives prosecutors something closer to this ability in practice than is commonly acknowledged.
* Under the old political norms, "the five-member Election Commission to be politically diverse and for the government of the day to consult the opposition before nominating candidates." Now, the incumbents on that commission lose their offices following each new election, the winning party or coalition can (and in the case of Fidesz, has) appointed their own partisans to all of the seats on the Commission.
Thus, Hungary has retreated from the European norm of having non-partisan electoral administration to the American norm of having elections run by whatever partisan elected official prevailed in the last election. In the U.S. that official is typically called the Secretary of State at the state level and the County Clerk at the local level. There is no significant national level election administration in the United States.
* In a move that is classic in American politics, but unfamiliar to Europeans, Fidesz has gerrymandered the electoral districts in their favor; "using the new district boundaries [in the last three elections] . . . Fidesz would have won all three elections, including the two they actually lost."
* Fidesz has appointed partisan minded loyalists to posts in charge of "human rights, data protection and minority affairs", the "public prosecutor, the state audit office and, most recently, the Central Bank."
It is classic, American style, spoils to the victor political appointment politics.
* Content based media regulation has been instituted.
New "media laws created a new media board – staffed only by Fidesz party loyalists with a chair who is appointed by the Prime Minister to a nine-year term. This board can review all public and private media for their compliance with a nebulous standard of political “balance” and has the power to bankrupt any news organization with large fines. It is not surprising that the media have become self-censoring."
Basically, every media outlet in Hungary is now legally required to behave like Fox News. This is something that conservative Republicans in the U.S. can only dream of having, under constitutional law protections of the First Amendment freedom of the press that liberals and conservatives alike have upheld in the U.S.
* The party has enshrined conservative Christian social policy on abortion and gay rights and the status of the country as a Christian nation in the Constitution, despite the fact that only 21% of the population is religious, and limited official recognition of minority religions. Under the new constitution:
The fetus is protected from the moment of conception. Marriage is only legal if between a man and a woman. The constitution “recognize(s) the role of Christianity in preserving nationhood” and holds that “the family and the nation constitute the principal framework of our coexistence.” . . . a new law on the status of religion cut the number of state-recognized churches to only fourteen, deregistering 348 other churches.
In other words, the new Hungarian constitution pretty much matches the American Republican party platform on religious and social issues.
* Supermajority requirements that Fidesz has put in the constitution make it hard for their policies to be undone if the lose control of parliament.
The new constitution makes huge swaths of public policy changeable only by a two-thirds vote of any subsequent parliament. From here on, all tax and fiscal policy must be decided by a two-thirds supermajority. Even the precise boundaries of electoral districts cannot be changed by simple majority vote, but only by a two-third supermajority. If a new government gets a mere majority, policies instituted during the Fidesz government cannot be changed.
In other words, the Hungarian center-right party has created the equivalent of the filibuster powers of the minority in the U.S. Senate.
* They have given key political appointees long terms that could outlast their removal from office, subject only to impeachments by two-thirds majorities, much as the U.S. does for posts like the FBI director and the Federal Reserve:
The new constitutional order extends the terms of office for the public prosecutor (9 years), the head of the state audit office (12 years), the head of the national judicial office (9 years), the head of the media board (9 years), the head of the budget council (6 years) and more.
* They have based the GOP pipe dream of a balanced budget amendment with an institutional means of being enforced: "a national budget council with the power to veto any future budget that adds to the national debt, which any foreseeable budget will do. The members of the budget council have been chosen by this government for terms of 6 or 12 years and can only be replaced if two-thirds of the parliament can agree on new candidates when their terms are over. Another part of the constitution requires the parliament to pass a budget by March 31 of each year. If the parliament fails to do so, the president of the country can dissolve the parliament and call new elections."
Of course, in states like Colorado, similar substantive rules exist, although the institutional means of implementing those rules is a bit different, and most U.S. states have some form of balanced budget requirement often enforceable via a line item veto.
* The door has been opened to banning certain extremist political parties on theories similar to the McCarthy era anti-communist laws in the United States:
Under laws that preceded Fidesz’s election last year, political parties that are anti-constitutional may be banned. Some have suggested that Fidesz could eliminate [the Neo-Fascist] Jobbik [party] in this way.
It will also probably be made easier to prosecute communist era officials, and suppress the communist party, in a way that arguably and most troublingly opens the door to punitive sanctions of the main center-left opposition party arising from the Communist era regime:
According to a proposed constitutional amendment, the crimes of the former communist party will be listed in the constitution and the statute of limitations for prosecuting crimes committed during the communist period will be lifted. The former communist party is branded a criminal organization and the current opposition Socialist Party is designated as their legal successor. It is still unclear, legally speaking, what this amendment means. But it is probably not good for the major opposition party.
Analysis
Opposition forces are not totally without a remedy.
Hungary is a party to a number of European treaties including the human rights regime of the Council of Europe which has the power to mandate Bill of Rights like protections for citizens of member nations, and these kinds of treaty obligations are not as easily ignored in Europe, where taking treaties seriously is a practical necessity, as it is in the United States where our legal system and constitution as interpreted are notoriously hostile to any form of international law, even when it is party to an international treaty.
Popular support in Hungary for the Fidesz party has also plummeted from a peak of more than 40% around the time of the last election to less than 20% now, although these voters now largely sit in the ranks of the "undecided" or "unaffiliated" rather than having cast their support to any of the other pre-existing major parties. And, in Hungary's electoral system, a drop in the popular vote for the Fidesz party would have a disproportionate effect on the number of parliamentary seats they win in the next election and could easily reduce the Fidesz party to less than a third of the seats in parliament if their unpopularity was sustained. The Fidesz party did not campaign on major entrenching constitutional reforms (and probably was surprised itself to get the majorities necessary to enact them).
Normally, securing two-thirds majority support for just about any kind of political change is extremely hard, but if Hungarian voters forcefully reject the direction Fidesz is taking Hungary's political system in the next election, it wouldn't be surprising if all of the other political parties in parliament could form a coalition united around promptly undoing some or all of the entrenching reformed enacted by Fidesz, which are a life or death threat to all of the other political parties in the country.
The kind of tactics Fidesz has engaged in parallel the anti-union overreaching that Republicans in Wisconsin engaged in when they took control there following the 2010 elections that produced a string of state legislator recall efforts, some successful, although not enough to immediately deprive Republicans of control of that state, and an effort to recall the Republican Governor with an unprecedented level of grass roots support(petitions will be submitted January 17, 2012 and there is a decent chance that they will have a sufficient number of signatures by then). Also, while the trend evidenced by the Fidesz reforms in Hungary are troubling and anti-democratic,I'm less inclined towards a "sky is falling" take on how they might work out in practice, because so many of those reforms represent an adoption of long standing U.S. political practice. They look so horrible mostly because the status quo in Hungary is so good. The reforms overwhelmingly adopt the most flawed components of the American political system, and some proposals that would have made the American political system even worse if adopted, but it isn't impossible to run a somewhat functional democracy on this basis. Also, while these reforms do appear to be entrenching many solidly conservative Fidesz officials in office, it doesn't appear to be the case that the appointees have flaws are any worse than being particularly partisan and conservative. The officials are not being entrenched with absolute control forever, a la the Ayatolla's theocrats in Iran, and do not appear to adhere to ideologies that are fundamentally at odds with the basic concept of multi-party democratic capitalism. These appear to be politically conservative reformers, not true revolutionaries or anti-democratic religious extremists or Nazis.
Fidesz wants to tip the odds in its favor for the short and medium term future and substantively bound the scope of the political discussion to ideologies that they deem acceptable, but they are basically chasing a shot at becoming a dominant party with decades of continous rule in the traditional of Japan's LDP or Mexico's PRI or FDR's Democratic party, rather than a fully authoritarian regime.
The fact that Fidesz has pulled this off, however, has troubling historical echos from Weimar Germany. Hungary's pre-reform constitution, like that of Weimar Germany, was a model of constitutional democracy. Hungary voters, like those of Weimar Germany, influenced by hard economic times, put the parliamentaries who are carrying out these reforms to the political system into office in free and fair elections and according to the legal process set forth in the validly adopted constitution, not by virtue of military force. But, ultimately Weimar Germany reached a point of no return that undid that democratic regime that it embodied and there is good reason to fear that history could repeat itself in Hungary.
In particular, the fear is that if the Fidesz reforms continue apace, and that neither European human rights institutions nor sharp voter backlash against Fidesz are quite strong enough to prevent the reforms from going to far for too long, that Hungary could reach a tipping point and take the few extra steps on the trendline it has already embarked upon towards a true right wing authoritarian regime.
If the reforms made so far by Fidesz are at least prevented from going any further and interpreted in ways that mute the worst slippery slope concerns they engender by enough Fidesz appointees who care enough about the overall welfare of a democratic state in Hungary to restrain their raw capacity to exercise political power at least somewhat, Hungary could settle into being a seriously flawed, but genuine democracy like the United States in due time.
But, if Fidesz can push much farther beyond the brink that it has already approached, and its appointees in key political positions aren't sufficiently fair minded in their exercise of the power that the reformed constitutional arrangements give them, the potential for Hungary to slip into becoming a conservative one party authoritarian state that ends up being a sort of mirror image of the one party Communist regime it was for several decades of the 20th century is very real and is deeply troubling for the future of Europe as a whole. And, without the kind of long standing democratic norms and political culture that the United States had in place for about a century in its capacity as a group of semi-autonomous British colonies, even before it established its current constitution in 1789, Hungary's odds of overcoming its current crisis of democratic government are not nearly high enough that we can be comfortable that it will all work out.
The United States and some European international institutions have expressed concern about the political developments in Hungary. Realistically, there isn't much that the United States can do about it, however, other than to express concern. As this post explains, most of the changes that Fidesz has put in place brings Hungary closer to the norms of the American system of government, and most of those that aren't a part of American politics have been regularly sought by one of the two main political parties in the United States, so the U.S. can't bring much moral authority to the situation at this point. European institutions have far more leverage in the situation, but in the end, it is hard to impose democracy on a public that isn't willing to use, at least, the formal legal and political rights that they have to preserve their democracy.
A preference for a Western European style democratic political system is not like a desire for food, water, clothing or shelter. It is a learned preference that has a lot of individual and collective utility if it is widely shared, but when you have an electorate who spent their formative years without that system, the public commitment to that system will not be as deep. People naturally gravitate towards thinking of what they know as what is just and right, and what most of the people of Hungary know is life under a one party authoritarian regime. People can change their preferences and new generations can develop preferences different from those of their predecessors. But, only time will tell if the Western European democratic political culture has taken hold firmly enough in the people of Hungary for its initially state of art democratic constitution to successfully facilitate permanent democratic government in Hungary in the face of economic hardship and shallow public commitment to it.
The optimist in me give some credence to the idea that the optimal level of democracy to produce a stable functional democratic system is the bare minimum necessary to earn the name democratic at all, and that beyond that additional democratic refinements add little benefit and may even be counterproductive. Hence, a system of democratic elections sufficiently great to make electoral politics more attractive than a military insurgency annd to make those who govern cognizant of the wishes of the governed is good enough, and extra bells and whistles, like initiative processes, proportional representation, and campaign finance reforms may do more harm, by making the process more complex, than they add in terms of the quality of the democratic process given that the bare minimum standards have been met.
The pessimist in me says that things are going from bad to worse in Hungary, and that is would be a crime to stand by and do nothing if there was anything we could do to prevent the current anti-democratic trend there from going too far. Perhaps that is why I am writing this post. But, I'm hard pressed to see anything that can be done, at least by Americans, that isn't already being done, or any room for a lasting solution that doesn't predominantly come from the Hungarians and perhaps institutions with which they have treaty relationships and obligations.
20 December 2011
U.S. Corporate Income Tax Not As High As It Seems
The U.S. corporate income tax, considered on an apples to apples basis internationally, isn't as high as it seems when taxes on both corporate taxes and dividends received are considered. Also, under U.S. law, 90% of U.S. businesses aren't subject to this tax, most closely held C corporations can structure their affairs to avoid paying the full burden of these taxes, and even publicly held corporations often find ways to reduce the total tax burden dramatically with tax credits, international tax planning, retention of earnings together with capital gains tax breaks, and so on.
Being Kim Jong Un
Suppose you are Kim Jong Un. You are in your late twenties, similar in age to a typical entry level associate at a big law firm or medical resident or mid-career NCO in the military.
This week you have just inherited from your father (deceased at age 69 or 70, who was somewhat unbalanced and not the world's nicest guy) an entire country with twenty four million people, substantial territory and nuclear weapons on missiles at your disposal to rule as an absolute dictator, without even having to ask for campaign contributions or filling out a job application.
How do you feel about that? Are you overjoyed at your newfound power? Are you mostly consumed with grief over your father's death? Are you ticked off that your father totally screwed up your country causing millions of its people to die of starvation and the vast majority of the rest to live totally backward lives and then gave you the mess to clean up? Are you terrified that you'll screw up given your responsibilities? Are you terrified that you'll be assassinated by someone close to you before you have a chance to consolidate your authority? Do you seriously consider abdicating and letting someone else deal with it, after all who made it your problem?
By all accounts Kim Jong Un is a much more decent and sane person than either his father or his grandfather who preceded him in office (or than his older siblings who were passed over for the job after having amply demonstrated what losers they were), although not necessarily so charismatic. Do you worry that you aren't ruthless enough for the job? Do you try to act crazy and ruthless because you think you must to be taken seriously? Do you undermine your own power structure for the benefit of your people, knowing what works in other countries, or do you feel the need to enhance your own personal cult of personality in order to gain the clout in de facto power you need to institute major reforms? Do you follow the precedents and policies established by your father and grandfather, imitate the systems of places like Switzerland where you received some of your education, or try to devise some third way specific to your inclinations and local conditions? Do you submit to being a figurehead for your elders and late father's flunkies who wield power more directly and have more experience, or do you make your own decisions? Just because you've grown up around immense power doesn't mean that you know how to wield it yourself. Do you put your friends in power, or people you think you need to have support you? Do you indulge yourself with creature comforts attendant upon your new office, or throw yourself into a spartan life full of work? How do you date somebody?
This isn't quite a Princess Diaries moment. Your didn't grow up in some peasant household oblivious to your place in the society. If you are Kim Jong Un, you've known this day was coming for years, have lived your entire life in your father's inner circle which is the pinnacle of all political and economic power in the country, and have already had some close calls when you were nearly pushed into the job after your father's other health emergencies. Surely, you've spent a great deal of time thinking about this day. What kind of plans and expectations did you form in advance? Which of them will still seem to make sense now?
There is some reason to have optimism for the long term. While the early years of the rule of young, absolute leaders of countries has historically been a mixed bag, the ranks of the truely outstanding absolute rulers of nations are disproportionately made up of people who inherited the office at an early age, not people who took office after decades spent in an understudy role. Perhaps if you start young you have more time to learn how to do the job well and more of a stake in your long term success. We'll soon see how Kim Jong Un compares.
This week you have just inherited from your father (deceased at age 69 or 70, who was somewhat unbalanced and not the world's nicest guy) an entire country with twenty four million people, substantial territory and nuclear weapons on missiles at your disposal to rule as an absolute dictator, without even having to ask for campaign contributions or filling out a job application.
How do you feel about that? Are you overjoyed at your newfound power? Are you mostly consumed with grief over your father's death? Are you ticked off that your father totally screwed up your country causing millions of its people to die of starvation and the vast majority of the rest to live totally backward lives and then gave you the mess to clean up? Are you terrified that you'll screw up given your responsibilities? Are you terrified that you'll be assassinated by someone close to you before you have a chance to consolidate your authority? Do you seriously consider abdicating and letting someone else deal with it, after all who made it your problem?
By all accounts Kim Jong Un is a much more decent and sane person than either his father or his grandfather who preceded him in office (or than his older siblings who were passed over for the job after having amply demonstrated what losers they were), although not necessarily so charismatic. Do you worry that you aren't ruthless enough for the job? Do you try to act crazy and ruthless because you think you must to be taken seriously? Do you undermine your own power structure for the benefit of your people, knowing what works in other countries, or do you feel the need to enhance your own personal cult of personality in order to gain the clout in de facto power you need to institute major reforms? Do you follow the precedents and policies established by your father and grandfather, imitate the systems of places like Switzerland where you received some of your education, or try to devise some third way specific to your inclinations and local conditions? Do you submit to being a figurehead for your elders and late father's flunkies who wield power more directly and have more experience, or do you make your own decisions? Just because you've grown up around immense power doesn't mean that you know how to wield it yourself. Do you put your friends in power, or people you think you need to have support you? Do you indulge yourself with creature comforts attendant upon your new office, or throw yourself into a spartan life full of work? How do you date somebody?
This isn't quite a Princess Diaries moment. Your didn't grow up in some peasant household oblivious to your place in the society. If you are Kim Jong Un, you've known this day was coming for years, have lived your entire life in your father's inner circle which is the pinnacle of all political and economic power in the country, and have already had some close calls when you were nearly pushed into the job after your father's other health emergencies. Surely, you've spent a great deal of time thinking about this day. What kind of plans and expectations did you form in advance? Which of them will still seem to make sense now?
There is some reason to have optimism for the long term. While the early years of the rule of young, absolute leaders of countries has historically been a mixed bag, the ranks of the truely outstanding absolute rulers of nations are disproportionately made up of people who inherited the office at an early age, not people who took office after decades spent in an understudy role. Perhaps if you start young you have more time to learn how to do the job well and more of a stake in your long term success. We'll soon see how Kim Jong Un compares.
Wells Fargo Still Stupid Or Evil
A have a client who lost his home, which was worth considerable more than his mortgage from Wells Fargo bank, in a foreclosure more than a month ago that discharged the entire amount of the loan. Today, he calls me and tells me that he just got a letter today from Wells Fargo bank with the loan number, personal identifying information, pre-foreclosure loan balance and interest rate, etc. asking him to call them to talk about modifying his loan. Incidentally, he'd also repeatedly sent them extensive packets of loan modification information over the previous six months, which each time they claimed to have never received and never acknowledged.
Not only is Wells Fargo bank too big to fail, it also appears to be to stupid to live. If it ever makes economic sense for a bank like Wells Fargo to modify loans, it is missing the boat. This is a government program that it participates in formally, but doesn't seem to actually support.
Of course, a less charitable interpretation is that somebody in management at Wells Fargo bank has decided that loan modifications are not a profit center and has deliberately set up this division of the bank to fail, because these discussions frequently discourage debtors from taking the rest of the foreclosure process seriously and thereby improve their rate of success in the collections process. For example, the loan modification division employees at Wells Fargo bank routinely tell debtors orally that they don't have to take legal action and shouldn't try to cure a loan that will otherwise go into foreclosure so they can get a modified loan, although this division of Wells Fargo bank has a strict policy of not putting any of these communications in writing. The loan modification employees at Wells Fargo go blithly on their way spinning tales of forgiveness and compromise while the collections law firm that Wells Fargo has retained (one Colorado law firm whose name I will omit has the overwhelming majority of this business statewide) does not communicate any knowledge whatsoever that this is happening.
But, in Colorado, at least, something called the credit agreement statute of frauds prevents anyone from suing a bank for making misleading or outright fraudulent oral representations of this kind from a bank employee under state law, for any reason, even though a third party debt collector or attorney who made similar representations would have civil liability for compensatory and punitive damages, even if you can identify who said it and when, even if you have a tape recording of the conversation.
Is it so much to ask that different divisions of the same bank who are interacting with the same customers regarding the same loan have any communication with each other whatsoever? Is it so much to ask that banks have a legally enforceable duty to refrain from telling the people who owe them money that they can ignore legal process that is delivered to them and should refrain from exercising their rights in that process?
Not only is Wells Fargo bank too big to fail, it also appears to be to stupid to live. If it ever makes economic sense for a bank like Wells Fargo to modify loans, it is missing the boat. This is a government program that it participates in formally, but doesn't seem to actually support.
Of course, a less charitable interpretation is that somebody in management at Wells Fargo bank has decided that loan modifications are not a profit center and has deliberately set up this division of the bank to fail, because these discussions frequently discourage debtors from taking the rest of the foreclosure process seriously and thereby improve their rate of success in the collections process. For example, the loan modification division employees at Wells Fargo bank routinely tell debtors orally that they don't have to take legal action and shouldn't try to cure a loan that will otherwise go into foreclosure so they can get a modified loan, although this division of Wells Fargo bank has a strict policy of not putting any of these communications in writing. The loan modification employees at Wells Fargo go blithly on their way spinning tales of forgiveness and compromise while the collections law firm that Wells Fargo has retained (one Colorado law firm whose name I will omit has the overwhelming majority of this business statewide) does not communicate any knowledge whatsoever that this is happening.
But, in Colorado, at least, something called the credit agreement statute of frauds prevents anyone from suing a bank for making misleading or outright fraudulent oral representations of this kind from a bank employee under state law, for any reason, even though a third party debt collector or attorney who made similar representations would have civil liability for compensatory and punitive damages, even if you can identify who said it and when, even if you have a tape recording of the conversation.
Is it so much to ask that different divisions of the same bank who are interacting with the same customers regarding the same loan have any communication with each other whatsoever? Is it so much to ask that banks have a legally enforceable duty to refrain from telling the people who owe them money that they can ignore legal process that is delivered to them and should refrain from exercising their rights in that process?
19 December 2011
Is North Korea A Monarchy?
Kim Il Sung founded North Korea as a country and regime out of the ashes of World War II occupation of Korea by Japan and the process of new state formation that ultimately led to the Korean war, one of the first "hot" conflicts of the Cold War. There is a cease fire in that conflict but not a true peace treaty.
Kim Il Sung, who ruled that hard line one party Communist state as a dictator in a cult of personality, was succeeded by Kim Jong Il who ruled for seventeen years until his death, also as a dictator in a cult of personality.
Now, the heir apparent to rule North Korea is Kim Jong Un, the third son of Kim Il Sung, although the transfer of power has not been confirmed.
Assuming that Kim Jong Un does take power as an absolute dictator, like his two predecessors, at what point do we start to acknowledge the status of North Korea as a monarchy rather than a communist regime?
There are residual communist one party state frameworks for the regime, but these seem to have been increasingly withered in favor of a cult of personality that deifies the ruler.
Of course, there is also the question of how Kim Jong Un, a Swiss educated basketball fan who is by most accounts a serious, intelligent young man might choose to take his country out of the dark ages, where it lingers in autarky, backwardness, fear, and privation. The only comparable European example was the communist regime of Albania, which is now struggling to remark itself in a Western parliamentary capitalist mold, despite mishaps along the way.
Might Kim Jong Un see the path of constitutional monarchy, followed by Japan and Thailand, as attractive? Would he be willing to cede power to democractic elections by a polity so stripped of civil society and democratic instincts that it is hard to know if it would be even possible to recreate a democracy in that mold? Might he work towards reunification with South Korea?
His people might not know that the regime he is inheriting is profoundly backward, but he does, and surely have given considerable thought to what he would do if he was in charge. It is also entirely possible that there could be a coup of some kind by the real powerbrokers in the regime, for example, in the military.
This may seem like a mere academic exercise, but when a regime has nuclear weapons and missiles to deliver them, as well as submarines it has shown a willingness to use against its neighbors in recent history, the outcome matters, no matter how out of whack its parameters may be.
Kim Il Sung, who ruled that hard line one party Communist state as a dictator in a cult of personality, was succeeded by Kim Jong Il who ruled for seventeen years until his death, also as a dictator in a cult of personality.
Now, the heir apparent to rule North Korea is Kim Jong Un, the third son of Kim Il Sung, although the transfer of power has not been confirmed.
Assuming that Kim Jong Un does take power as an absolute dictator, like his two predecessors, at what point do we start to acknowledge the status of North Korea as a monarchy rather than a communist regime?
There are residual communist one party state frameworks for the regime, but these seem to have been increasingly withered in favor of a cult of personality that deifies the ruler.
Of course, there is also the question of how Kim Jong Un, a Swiss educated basketball fan who is by most accounts a serious, intelligent young man might choose to take his country out of the dark ages, where it lingers in autarky, backwardness, fear, and privation. The only comparable European example was the communist regime of Albania, which is now struggling to remark itself in a Western parliamentary capitalist mold, despite mishaps along the way.
Might Kim Jong Un see the path of constitutional monarchy, followed by Japan and Thailand, as attractive? Would he be willing to cede power to democractic elections by a polity so stripped of civil society and democratic instincts that it is hard to know if it would be even possible to recreate a democracy in that mold? Might he work towards reunification with South Korea?
His people might not know that the regime he is inheriting is profoundly backward, but he does, and surely have given considerable thought to what he would do if he was in charge. It is also entirely possible that there could be a coup of some kind by the real powerbrokers in the regime, for example, in the military.
This may seem like a mere academic exercise, but when a regime has nuclear weapons and missiles to deliver them, as well as submarines it has shown a willingness to use against its neighbors in recent history, the outcome matters, no matter how out of whack its parameters may be.
Gingrich: First Let's Lock Up the Judges
GOP nomination front runner Newt Gingrich's rheotric offers a stunningly dytopian approach to dealing with judges whose rulings he disagrees with:
The result, of course, would be a constitutional crisis in which the decision of the U.S. Marshal in question about who to obey would be hard to determine and an impeachment effort would surely follow.
Newt Gingrich seems bound and determined to become yet another Republican hellbent on dismantling our system of government and showing would be voters that he is too crazy and extreme to be trusted to lead the free world. But, apparently, the activist Republican grass roots are hungering for crazy.
Gingrich also claims that the President has the authority to defy federal court orders.
The extreme rhetoric cost Gingrich the endorsement of Iowa's leading newspaper, less than three weeks before their first in the nation Presidential nomination caucus:
Proposals like Gingrich's are amusing as satire, from a powerless blogger, but less amusing when they come in the form of serious discussion about a viable Presidental candidate's agenda should he take office.
With just weeks to go before the Iowa Caucus, Newt Gingrich . . . former House Speaker held a half-hour phone call on Saturday during which he pledged to abolish courts and eliminated activist judges he believed were either outside the mainstream or infringing too deeply on the commander in chief's authority.
On Sunday, he followed that up by saying he would be willing to arrest a judge who he thought was out of line.
"If you had to," he said on CBS's "Face the Nation" when asked if he would send a Capitol Hill police officer to round up a judge, "or you would instruct the Justice Department to send the U.S. Marshal."
The result, of course, would be a constitutional crisis in which the decision of the U.S. Marshal in question about who to obey would be hard to determine and an impeachment effort would surely follow.
Newt Gingrich seems bound and determined to become yet another Republican hellbent on dismantling our system of government and showing would be voters that he is too crazy and extreme to be trusted to lead the free world. But, apparently, the activist Republican grass roots are hungering for crazy.
Gingrich also claims that the President has the authority to defy federal court orders.
The extreme rhetoric cost Gingrich the endorsement of Iowa's leading newspaper, less than three weeks before their first in the nation Presidential nomination caucus:
The Des Moines Register, when announcing its endorsement for Republican presidential candidate Mitt Romney on Saturday, lauded the former Massachusetts governor's restraint from "reckless rhetoric and moralizing" while "other candidates have pandered to extremes with attacks on the courts and sermons on Christian values."
Proposals like Gingrich's are amusing as satire, from a powerless blogger, but less amusing when they come in the form of serious discussion about a viable Presidental candidate's agenda should he take office.
Ancient Rome Has Less Income Equality Than The U.S.
[I]n Rome the top 1.5% controlled 15-25% of income while in the United States around 2007 the top 1% controlled 23.5% of income thus suggesting slightly more inequality in the United States. Scheidel and Friesen calculate a Roman Empire gini coefficient of .42-.44 again perhaps slightly less than the U.S. coefficient of around .4-.45 depending on source.
More details here.
16 December 2011
Uninformed Less Partisan People Tame Intense Minorities In Democracies
People who are not very informed about issues and have not very strong opinions about issues tend to side with the numerical majority of those who do have a point of view, even if there is a very intense majority that favors the other position. Thus, ill informed moderate voters may actually enhance democratic consensus building and prevent the tyranny of the minority. The empirically motivated conclusions are contrary expectations that uninformed individuals are swayed by the loudest voices.
Even a small number of uninformed individuals without strong opinions dramatically strengthens the consesus building process.
Even a small number of uninformed individuals without strong opinions dramatically strengthens the consesus building process.
15 December 2011
Saudi Arabia Still Executes Witches Under Color Of Law
The Saudi Arabian government (which is still an absolute monarchy) executed a woman for practicing witchcraft purported to heal (for about $800 per session) this week.
Life As A Big Brother Parent And The Vanishing Generation Gap
As a responsible twenty-first century, reasonably technologically competent parent, I know far more about my children's personal conduct when I'm not around than my parents did about mine.
Netflix provides me with a detailed summary of what was watched for how long on which day, and it isn't very hard to infer which child watched what movie or television show.
My daughter almost always prefers texting to talking on her cell phone or a landline, and a glance now and then at that phone details for me, what was said, verbatim, on every side of every communication, when it was said, and to whom it was said.
The Denver Public Schools provide parents of middle schoolers with not just a few times a year general report card, but the ability to look at every grade in the gradebook for my child in every class in real time, and almost all of my child's teachers have websites that provide details on current homework assignments, the school and superintendent and PTA have newsletters that go straight to my personal e-mail account, and every teacher and administrator is never more than an e-mail way.
A significant number of homework assignments and activities come with parental signoffs that require them to be reviewed by a parent.
I have access to my children's Denver Public library accounts that tell what is checked out and when it is due, because they expect me to renew their books online before they are overdue.
One of my children has a Kindle, that they both use sometimes, and every new download to it is reported to my e-mail account.
Every withdrawal from the children's bank accounts must happen with a parent present, and in practice, so must every deposit, because the bank is too far from home to get to without parental assistance.
A parent is usually present at music lessons, again, in part due to transportation considerations, so we know what is supposed to be practiced for the week.
We have the practical capacity to read our children's e-mail, and since they often choose to do so from a living room computer, we see who they write to, what they say, and when they write, on a regular basis.
Of course, we still have the old school options of wandering into children's rooms to see what is there, and evesdropping when car pooling kids in the back seat ignore your presence. We accompany each child to the either a schoool bus stop, or the school's front door, so we know what they wear to school and what they bring to school.
Neither of my children have ever kept a meaningful diary, but the middle school requires each child to keept a detailed planner with homework assignment due dates in it, which could be reviewed in detail.
I could access far more information than I actually do, of course. And, certainly, I don't know everything. For example, I rarely check Internet browsing histories, recently updated document files on computers, and recycling bins on computers, although I know how to do that. But, if I had concerns, it would be easy to be more vigilant.
Honestly, in an almost purely effortless way, I get more information about fairly private conduct by my children than I want or need.
The hard question is what to do with that information. How aggessive does it make sense to be in dogging a kid to study for tests after a low mark now and then, when better grades on homework give that kid straight A report cards? What should you choose to say when a child is watching television at times when it is permitted under house media rules, and the shows they choose to watch aren't harmful but aren't always what you would think were the most appropriate either? Your own parents didn't even know what you watched when they weren't present. What use should you make of your imperfect digitally based knowledge of your children's social networks?
In practice, it seems as if the choices our children make that we aren't particularly happy about have turned out to be the ones made with our full knowledge and not secret ones. Openness is good and secrets are bad, right? Convincing them to do the right things seems to be a bigger battle than knowing what their choices are at this point in life (a middle schooler and a soon to be middle schooler).
I'm sure that the Big Brother opportunities that come with twenty-first century parenting could be sorely abused by other parents with more strict parenting styles who had a stronger belief in the benefits of controlling the influences in their children's lives. But, in our family, we're relaxed and trusting enough that the extra knowledge is almost superfluous and probably excessive. Maybe when they get into their teen years the desire for privacy will increase, and this will become more of a point of tension. Then again, maybe it won't. It doesn't seem to be one for the parents we know who do have teenagers.
I've felt for some time (with support now and then in the media) that the generation gap is as small as it has ever been in recent memory, so maybe that defuses some of the tensions that I remember from when I was that age. As a Vanity Fair article I read recently, explained, in terms of visual cultural feel and style, the world hasn't changed much in twenty years:
Moreover, when there have been changes in the past twenty years, my generation has adapted to it every bit as much as my children's generation experiencing it for the first time. I got my first cell phone a couple of years before my daughter got her first cell phone, for example. Three of the four members of my household have blogs, although only I use mine with any frequency.
When the children listen to Radio Disney, the music reminds me of the Top 40 pop music I grew up with, although my mix didn't have rap and country, and I listen to rap and country and pop music in the same genres anyway; often with the same songs playing, although the mouse is a bit more selective than I am. I've read many of the books that they're reading, sometimes, as in the case of the Harry Potter or Twilight books, for example, even though they weren't in print when I was a kid.
The political aspirations of my children's generation, so far as I can discern, are extraordinarily wholesome and in tune with those of my wife and I. The two mommies families I represent as a lawyer are the same families that they go to school with every day. The concern with the environment they show is the same one that I grew up with myself. The struggles over authority with school administrators and other adults that I recall being seeped in as a child are no where in evidence, in part, because those authority figures seem to understand the kids better than they did when I was a kid.
When I was a kid, the coaches of our soccer teams had to learn the rules from books at the library because they'd never played the game as children. Now, both of my children have played soccer and I haven't needed to learn the rules or the skills and strategies involved from books or strangers - it has become the near dominant team sport of their generation, just as it was starting to be in mine.
I will be taking one of my kids this weekend, without any parental prompting whatsoever, to a shoe store to buy the exact same sneakers that I wore in casual settings every day from the time I was ten until I was thirty-five. The style has considerably outlasted the company that made them (which licensed them to someone else as an asset in a bankruptcy).
Certainly, my children's lives are different than my life was at the same age. But, the changes have mostly been ones that align them more with where I am culturally now, rather than dividing us culturally.
Is this simply the calm before the storm? Perhaps. But, for now, we'll enjoy the tension it alleviates from lives that aren't so private anymore.
Netflix provides me with a detailed summary of what was watched for how long on which day, and it isn't very hard to infer which child watched what movie or television show.
My daughter almost always prefers texting to talking on her cell phone or a landline, and a glance now and then at that phone details for me, what was said, verbatim, on every side of every communication, when it was said, and to whom it was said.
The Denver Public Schools provide parents of middle schoolers with not just a few times a year general report card, but the ability to look at every grade in the gradebook for my child in every class in real time, and almost all of my child's teachers have websites that provide details on current homework assignments, the school and superintendent and PTA have newsletters that go straight to my personal e-mail account, and every teacher and administrator is never more than an e-mail way.
A significant number of homework assignments and activities come with parental signoffs that require them to be reviewed by a parent.
I have access to my children's Denver Public library accounts that tell what is checked out and when it is due, because they expect me to renew their books online before they are overdue.
One of my children has a Kindle, that they both use sometimes, and every new download to it is reported to my e-mail account.
Every withdrawal from the children's bank accounts must happen with a parent present, and in practice, so must every deposit, because the bank is too far from home to get to without parental assistance.
A parent is usually present at music lessons, again, in part due to transportation considerations, so we know what is supposed to be practiced for the week.
We have the practical capacity to read our children's e-mail, and since they often choose to do so from a living room computer, we see who they write to, what they say, and when they write, on a regular basis.
Of course, we still have the old school options of wandering into children's rooms to see what is there, and evesdropping when car pooling kids in the back seat ignore your presence. We accompany each child to the either a schoool bus stop, or the school's front door, so we know what they wear to school and what they bring to school.
Neither of my children have ever kept a meaningful diary, but the middle school requires each child to keept a detailed planner with homework assignment due dates in it, which could be reviewed in detail.
I could access far more information than I actually do, of course. And, certainly, I don't know everything. For example, I rarely check Internet browsing histories, recently updated document files on computers, and recycling bins on computers, although I know how to do that. But, if I had concerns, it would be easy to be more vigilant.
Honestly, in an almost purely effortless way, I get more information about fairly private conduct by my children than I want or need.
The hard question is what to do with that information. How aggessive does it make sense to be in dogging a kid to study for tests after a low mark now and then, when better grades on homework give that kid straight A report cards? What should you choose to say when a child is watching television at times when it is permitted under house media rules, and the shows they choose to watch aren't harmful but aren't always what you would think were the most appropriate either? Your own parents didn't even know what you watched when they weren't present. What use should you make of your imperfect digitally based knowledge of your children's social networks?
In practice, it seems as if the choices our children make that we aren't particularly happy about have turned out to be the ones made with our full knowledge and not secret ones. Openness is good and secrets are bad, right? Convincing them to do the right things seems to be a bigger battle than knowing what their choices are at this point in life (a middle schooler and a soon to be middle schooler).
I'm sure that the Big Brother opportunities that come with twenty-first century parenting could be sorely abused by other parents with more strict parenting styles who had a stronger belief in the benefits of controlling the influences in their children's lives. But, in our family, we're relaxed and trusting enough that the extra knowledge is almost superfluous and probably excessive. Maybe when they get into their teen years the desire for privacy will increase, and this will become more of a point of tension. Then again, maybe it won't. It doesn't seem to be one for the parents we know who do have teenagers.
I've felt for some time (with support now and then in the media) that the generation gap is as small as it has ever been in recent memory, so maybe that defuses some of the tensions that I remember from when I was that age. As a Vanity Fair article I read recently, explained, in terms of visual cultural feel and style, the world hasn't changed much in twenty years:
Since 1992, as the technological miracles and wonders have propagated and the political economy has transformed, the world has become radically and profoundly new. (And then there’s the miraculous drop in violent crime in the United States, by half.) Here is what’s odd: during these same 20 years, the appearance of the world (computers, TVs, telephones, and music players aside) has changed hardly at all, less than it did during any 20-year period for at least a century. The past is a foreign country, but the recent past—the 00s, the 90s, even a lot of the 80s—looks almost identical to the present. This is the First Great Paradox of Contemporary Cultural History.
Think about it. Picture it. Rewind any other 20-year chunk of 20th-century time. There’s no chance you would mistake a photograph or movie of Americans or an American city from 1972—giant sideburns, collars, and bell-bottoms, leisure suits and cigarettes, AMC Javelins and Matadors and Gremlins alongside Dodge Demons, Swingers, Plymouth Dusters, and Scamps—with images from 1992. Time-travel back another 20 years, before rock ’n’ roll and the Pill and Vietnam, when both sexes wore hats and cars were big and bulbous with late-moderne fenders and fins—again, unmistakably different, 1952 from 1972. You can keep doing it and see that the characteristic surfaces and sounds of each historical moment are absolutely distinct from those of 20 years earlier or later: the clothes, the hair, the cars, the advertising—all of it. It’s even true of the 19th century: practically no respectable American man wore a beard before the 1850s, for instance, but beards were almost obligatory in the 1870s, and then disappeared again by 1900. The modern sensibility has been defined by brief stylistic shelf lives, our minds trained to register the recent past as old-fashioned.
Moreover, when there have been changes in the past twenty years, my generation has adapted to it every bit as much as my children's generation experiencing it for the first time. I got my first cell phone a couple of years before my daughter got her first cell phone, for example. Three of the four members of my household have blogs, although only I use mine with any frequency.
When the children listen to Radio Disney, the music reminds me of the Top 40 pop music I grew up with, although my mix didn't have rap and country, and I listen to rap and country and pop music in the same genres anyway; often with the same songs playing, although the mouse is a bit more selective than I am. I've read many of the books that they're reading, sometimes, as in the case of the Harry Potter or Twilight books, for example, even though they weren't in print when I was a kid.
The political aspirations of my children's generation, so far as I can discern, are extraordinarily wholesome and in tune with those of my wife and I. The two mommies families I represent as a lawyer are the same families that they go to school with every day. The concern with the environment they show is the same one that I grew up with myself. The struggles over authority with school administrators and other adults that I recall being seeped in as a child are no where in evidence, in part, because those authority figures seem to understand the kids better than they did when I was a kid.
When I was a kid, the coaches of our soccer teams had to learn the rules from books at the library because they'd never played the game as children. Now, both of my children have played soccer and I haven't needed to learn the rules or the skills and strategies involved from books or strangers - it has become the near dominant team sport of their generation, just as it was starting to be in mine.
I will be taking one of my kids this weekend, without any parental prompting whatsoever, to a shoe store to buy the exact same sneakers that I wore in casual settings every day from the time I was ten until I was thirty-five. The style has considerably outlasted the company that made them (which licensed them to someone else as an asset in a bankruptcy).
Certainly, my children's lives are different than my life was at the same age. But, the changes have mostly been ones that align them more with where I am culturally now, rather than dividing us culturally.
Is this simply the calm before the storm? Perhaps. But, for now, we'll enjoy the tension it alleviates from lives that aren't so private anymore.
Debtor-Creditor Law In The Big Picture Part I: The Problems
The vast majority of civil actions are debtor-creditor cases. They begin when a credit card bill or invoice was not paid as agreed, a rent payment was missed, a mortgage or car payment was missed, or taxes are not paid when due.
This system is flawed in different ways for different categories of cases.
Where The System Works: Dispute Resolution Between Solvent Parties Over Large Debts
The system works reasonably well to enforce or refuse to enforce debts based upon contracts in writing where both the creditor and debtor can afford to hire lawyers and recognize the need to do so, but the debtor refuses to pay due to a dispute, bona fide or not, in significant dollar amount cases (realistically something in the vicinity of $50,000 to $100,000 and up).
The trouble is that very few cases in the court system fit this description.
Dispute Resolution For Intermediate Sized Debts
The current system is not a good means of dispute resolution for intermediate dollar claims between solvent parties, although serious efforts, thus far mostly unsuccessful, have been made in Colorado to change that reality.
While Colorado's limited jurisdiction courts for civil claims under $15,000 provide a fairly cost effective (and not entirely pro se party unfriendly) forum to disolve these disputes on the merits through a fairly prompt trial on the merits (three to six months typically) with little or no meaningful pretrial motion practice or discovery (which isn't really doesn't pass cost-benefit muster in cases with dollar stakes this low in simple collection cases), Colorado's general jurisdiction courts for larger civil claims routinely require the parties to incur litigation costs that are disproportionate to the amount in dispute to resolve these intermediate sized claims of more than $15,000 but less than something on the order of $50,000 to $100,000.
Inability To Pay Cases
The vast majority of cases involve creditors who can afford to hire lawyers and debtors cannot afford to pay and cannot afford to hire lawyers given the cost of hiring a lawyer relative to the amount in controversy, or because the debtor is currently illiquid even if the debtor might someday have an ability to pay the lawyer.
Undisputed Debts
In these cases, when there is no bona fide dispute over the debt, there is an incentive to throw up some kind of defense, even if it isn't very strong, in order to allow the debtor to hold onto all of his assets and income for as long as possible. Also, frequently, the debtor owes debts to multiple creditors whose debts in the aggregate exceed the ability of the debtor to pay, and the current system gives unjustified preference to whomever makes it to court first, or whomever the debtor choses to be most cooperative with in negotiations with creditors, in each case, for all sorts of reasons that shouldn't matter in prioritizing the extent to which all of a debtor's creditors should be repaid out of assets insufficient to repay them all. Also, a debtor who has claims hanging over his head that have not been fully repaid, whether or not reduced to judgment, but for whom bankruptcy is unattractive for any of a variety of reasons from inability to pay for attorneys to being uncollectible anyway, has no incentive at that point to make any effort to maximize his income and ability to repay those creditors.
The non-bankruptcy debt collection system isn't a total failure and can work well enough when there are just a few creditors who care enough to resort to litigation, payment plans and compromises can be worked out in connection with the court process of debt collection, in the shadow of the involuntary collection methods the process makes available. Yet, ironically, in the cases that best fit this profile, such as insolvent corporations whose debts are mostly consolidated into bonds enforceable by a small number of bond trustees and institutional investors, or in single asset companies with a single bank lender, debtor resort to the bankruptcy process seems to be particularly common.
Undisputed Debts Greater Than The Ability To Pay Where The Full Amount Claimed Is Disputed That Aren't Litigated
The system is particularly unfair and/or wasteful of both creditor and debtor and court system litigation resources in cases where the debtor is unable to pay the amount that the debtor admits is owed, but still disputes significant amounts of the debt, whether or not the debtor can afford an attorney.
In these cases, if the debtor can't afford to mount a legal defense and as a result, for example, a default judgment or judgment due to some other kind of failure to property participate in the court process produces a judgment that doesn't address the merits of the disputed amount, if the debtor later comes into money, the debtor may be forced to pay an excessive judgment amount that can not be revisited due to the strong rule of finality for civil judgments. Effectively, the debtor has been denied due process.
Also, the excessive award in favor of one creditor may deny other creditors their fair share of the available assets. As a general rule, there is no way that one creditor of a debtor can dispute the amount of another creditor's money judgment, even if they had the incentive that the debtor did not, to litigate the issue on the merits. But, once a debtor is undeniably insolvent, a debtor has no more incentive to dispute totally bogus claims than he does to dispute valid claims.
A variant on this situation which is also very common is the case where a default judgment is entered against a debtor (typically a consumer debtor) who is either not properly served with process, or is too unsophisticated to understand how important it is to take action before a particular date (which the debtor may not accurately determine anyway). A significant number of consumer debtors (and even moderately sophisticated small business debtors) don't take legal process seriously until it results in a garnishment or seizure of property and are astounded to discover that it is very hard to raise any defense on the merits to the money judgment at that point because a default judgment was entered against them.
Undisputed Debts Greater Than The Ability To Pay Where The Full Amount Claimed Is Disputed That Are Litigated
On the other hand, if the debtor can afford to mount a legal defense, he has a strong incentive to do so to defer collection of the undisputed portion of the creditor's claim and prevent a judgment in amount greater than the amount actually owed from being entered so that he is not forced to pay to much if he is later able to pay the debt. But, if it turns out that the debtor is never able to pay even the undisputed amount of the claim, the litigation over a legal defense inappropriately delays collection of the undisputed amount and reduces the total size of the pie available to creditors on a disputed issue that is purely theoretical and contingent upon an improvement in the debtor's fortunes that will never happen. From the point of view of efficiency in the use of legal system resources for all parties and the court system, it would be better if litigation of the disputed portions of the debts on the merits was deferred until the debtor actually had sufficient funds to pay more than the debtor's undisputed debts.
Value Impairing Collections
In addition to the concern that the collections process can be inequitable between multiple creditors of the same insolvent debtor and impairment of earning incentives of debtors, who does not resort to the bankruptcy process which provides more fair relative recoveries and better incentives for any of a variety of reasons, the collections process also often inappropriately reduces the size of the pool of funds available for collection.
An involuntary disposition of property other than money garnished from bank accounts or wages, pursuant to a pre-judgment lien or the collection process that a money judgment makes available to creditors routinely discharges less of a debt than the price that could have been secured in a disposition of the property in the ordinary course by a non-distressed seller. This hurts other creditors of the debtor (and the debtor), if the creditor accepts the seized property in a full settlement of a debt that is smaller in amount than the amount owed. If the disposition is at an auction where there is a third party bid, it may also hurt the collecting creditor.
Moreover, when the fact that the debtor is distressed is known to potential buyers, the likelihood that the debtor will end up parting with the property at less than fair market value also impairs the value at which the debtor can dispose of the property voluntarily because would be buyers know that the debtor can't afford to wait for a better offer for very long.
And, while debts are hanging over a debtor, he has a reduced incentive to earn income, to be thrifty, and to drive hard bargains in any of his other dealings, in his personal life or business dealings.
Claim Priority Issues In Bankruptcy
The priorities of claims in bankruptcy law are also not optimal. As a general rule, bankruptcy awards creditors an equal percentage payout from available funds. But, sometimes this formal equality is inequitable.
This rule encourages creditors to inflate their claims in bankruptcy, once they know that they probably won't be receiving payment in full, with high default interest rate and late payment penalties. Punitive damages and similar statutory penalty damages in excess of the amounts necessary to b e compensatory have a similar effect when a debtor is insolvent and has multiple creditors. Rather than first repaying the amounts which creditors would have been entitled to expect in the absence of a default before paying "extras", the bankruptcy priority system treats all of these amounts claimed as equal priority general creditor claims.
There are other faults to the priority system, of course, particularly in business bankruptcies, but the equal priority given to default interest and penalties is most pertinent to relatively run of the mill, non-business cases.
This system is flawed in different ways for different categories of cases.
Where The System Works: Dispute Resolution Between Solvent Parties Over Large Debts
The system works reasonably well to enforce or refuse to enforce debts based upon contracts in writing where both the creditor and debtor can afford to hire lawyers and recognize the need to do so, but the debtor refuses to pay due to a dispute, bona fide or not, in significant dollar amount cases (realistically something in the vicinity of $50,000 to $100,000 and up).
The trouble is that very few cases in the court system fit this description.
Dispute Resolution For Intermediate Sized Debts
The current system is not a good means of dispute resolution for intermediate dollar claims between solvent parties, although serious efforts, thus far mostly unsuccessful, have been made in Colorado to change that reality.
While Colorado's limited jurisdiction courts for civil claims under $15,000 provide a fairly cost effective (and not entirely pro se party unfriendly) forum to disolve these disputes on the merits through a fairly prompt trial on the merits (three to six months typically) with little or no meaningful pretrial motion practice or discovery (which isn't really doesn't pass cost-benefit muster in cases with dollar stakes this low in simple collection cases), Colorado's general jurisdiction courts for larger civil claims routinely require the parties to incur litigation costs that are disproportionate to the amount in dispute to resolve these intermediate sized claims of more than $15,000 but less than something on the order of $50,000 to $100,000.
Inability To Pay Cases
The vast majority of cases involve creditors who can afford to hire lawyers and debtors cannot afford to pay and cannot afford to hire lawyers given the cost of hiring a lawyer relative to the amount in controversy, or because the debtor is currently illiquid even if the debtor might someday have an ability to pay the lawyer.
Undisputed Debts
In these cases, when there is no bona fide dispute over the debt, there is an incentive to throw up some kind of defense, even if it isn't very strong, in order to allow the debtor to hold onto all of his assets and income for as long as possible. Also, frequently, the debtor owes debts to multiple creditors whose debts in the aggregate exceed the ability of the debtor to pay, and the current system gives unjustified preference to whomever makes it to court first, or whomever the debtor choses to be most cooperative with in negotiations with creditors, in each case, for all sorts of reasons that shouldn't matter in prioritizing the extent to which all of a debtor's creditors should be repaid out of assets insufficient to repay them all. Also, a debtor who has claims hanging over his head that have not been fully repaid, whether or not reduced to judgment, but for whom bankruptcy is unattractive for any of a variety of reasons from inability to pay for attorneys to being uncollectible anyway, has no incentive at that point to make any effort to maximize his income and ability to repay those creditors.
The non-bankruptcy debt collection system isn't a total failure and can work well enough when there are just a few creditors who care enough to resort to litigation, payment plans and compromises can be worked out in connection with the court process of debt collection, in the shadow of the involuntary collection methods the process makes available. Yet, ironically, in the cases that best fit this profile, such as insolvent corporations whose debts are mostly consolidated into bonds enforceable by a small number of bond trustees and institutional investors, or in single asset companies with a single bank lender, debtor resort to the bankruptcy process seems to be particularly common.
Undisputed Debts Greater Than The Ability To Pay Where The Full Amount Claimed Is Disputed That Aren't Litigated
The system is particularly unfair and/or wasteful of both creditor and debtor and court system litigation resources in cases where the debtor is unable to pay the amount that the debtor admits is owed, but still disputes significant amounts of the debt, whether or not the debtor can afford an attorney.
In these cases, if the debtor can't afford to mount a legal defense and as a result, for example, a default judgment or judgment due to some other kind of failure to property participate in the court process produces a judgment that doesn't address the merits of the disputed amount, if the debtor later comes into money, the debtor may be forced to pay an excessive judgment amount that can not be revisited due to the strong rule of finality for civil judgments. Effectively, the debtor has been denied due process.
Also, the excessive award in favor of one creditor may deny other creditors their fair share of the available assets. As a general rule, there is no way that one creditor of a debtor can dispute the amount of another creditor's money judgment, even if they had the incentive that the debtor did not, to litigate the issue on the merits. But, once a debtor is undeniably insolvent, a debtor has no more incentive to dispute totally bogus claims than he does to dispute valid claims.
A variant on this situation which is also very common is the case where a default judgment is entered against a debtor (typically a consumer debtor) who is either not properly served with process, or is too unsophisticated to understand how important it is to take action before a particular date (which the debtor may not accurately determine anyway). A significant number of consumer debtors (and even moderately sophisticated small business debtors) don't take legal process seriously until it results in a garnishment or seizure of property and are astounded to discover that it is very hard to raise any defense on the merits to the money judgment at that point because a default judgment was entered against them.
Undisputed Debts Greater Than The Ability To Pay Where The Full Amount Claimed Is Disputed That Are Litigated
On the other hand, if the debtor can afford to mount a legal defense, he has a strong incentive to do so to defer collection of the undisputed portion of the creditor's claim and prevent a judgment in amount greater than the amount actually owed from being entered so that he is not forced to pay to much if he is later able to pay the debt. But, if it turns out that the debtor is never able to pay even the undisputed amount of the claim, the litigation over a legal defense inappropriately delays collection of the undisputed amount and reduces the total size of the pie available to creditors on a disputed issue that is purely theoretical and contingent upon an improvement in the debtor's fortunes that will never happen. From the point of view of efficiency in the use of legal system resources for all parties and the court system, it would be better if litigation of the disputed portions of the debts on the merits was deferred until the debtor actually had sufficient funds to pay more than the debtor's undisputed debts.
Value Impairing Collections
In addition to the concern that the collections process can be inequitable between multiple creditors of the same insolvent debtor and impairment of earning incentives of debtors, who does not resort to the bankruptcy process which provides more fair relative recoveries and better incentives for any of a variety of reasons, the collections process also often inappropriately reduces the size of the pool of funds available for collection.
An involuntary disposition of property other than money garnished from bank accounts or wages, pursuant to a pre-judgment lien or the collection process that a money judgment makes available to creditors routinely discharges less of a debt than the price that could have been secured in a disposition of the property in the ordinary course by a non-distressed seller. This hurts other creditors of the debtor (and the debtor), if the creditor accepts the seized property in a full settlement of a debt that is smaller in amount than the amount owed. If the disposition is at an auction where there is a third party bid, it may also hurt the collecting creditor.
Moreover, when the fact that the debtor is distressed is known to potential buyers, the likelihood that the debtor will end up parting with the property at less than fair market value also impairs the value at which the debtor can dispose of the property voluntarily because would be buyers know that the debtor can't afford to wait for a better offer for very long.
And, while debts are hanging over a debtor, he has a reduced incentive to earn income, to be thrifty, and to drive hard bargains in any of his other dealings, in his personal life or business dealings.
Claim Priority Issues In Bankruptcy
The priorities of claims in bankruptcy law are also not optimal. As a general rule, bankruptcy awards creditors an equal percentage payout from available funds. But, sometimes this formal equality is inequitable.
This rule encourages creditors to inflate their claims in bankruptcy, once they know that they probably won't be receiving payment in full, with high default interest rate and late payment penalties. Punitive damages and similar statutory penalty damages in excess of the amounts necessary to b e compensatory have a similar effect when a debtor is insolvent and has multiple creditors. Rather than first repaying the amounts which creditors would have been entitled to expect in the absence of a default before paying "extras", the bankruptcy priority system treats all of these amounts claimed as equal priority general creditor claims.
There are other faults to the priority system, of course, particularly in business bankruptcies, but the equal priority given to default interest and penalties is most pertinent to relatively run of the mill, non-business cases.
13 December 2011
Colorado General Assembly Districts Final
The first time the Blue Ribbon Commission that draws the state house and state senate districts in Colorado proposed a map to the Colorado Supreme Court, the Republicans complained that city boundaries and county lines were too often ignored in favor of factors that the commission wasn't required to consider. The Colorado Supreme Court agreed, but the Republicans paid dearly for their impertinence. A new map was approved, without any Republican support, that left many incumbent Republican legislators in the same districts with each other (another factor outside the scope of official consideration), while being more favorable to Democrats, overall, than the first map, even though it was more respectful of city and county lines. The Colorado Supreme Court approved the new map over Republican objections on Monday.
Democrats have already secured Colorado Supreme Court approval for the judge drawn Congressional District map that makes incumbent Republican Congressman Mike Coffman in the 6th Congressional District (once one of the safest in the state) much more vulnerable, at the cost of making the 4th Congressional District, which already has an incumbent Republican as well, safer.
Thus, Democrats are the clear winners in the battle to redistrict the state following the 2010 Census in time for the 2012 election. Redistricting has made the likelihood that Democratics will increase the number of Congressional seats they hold in Colorado much greater, has improved the odds that Democrats will be able to wrest control of the state house from Republicans who currently hold a once seat advantage there (a seat itself won by a narrow margin at the height of the Tea Party political surge), and has improved the odds that the Democrats will be able to hold the state senate. Democrats are also in a better position to pick up seats on the state school board and University of Colorado Regents whose districts coincide with the state's Congressional districts, although neither body is very powerful.
Election officials, armed with the legislative district boundaries for 2012 can now start drawing up precinct boundaries. School board, city council and special district seat boundaries also have to be redrawn based on census data, but historically, that has been a comparatively low profile event.
Colorado's Democratic Governor and Lieutenant Governor, Republican Secretary of State, Republican Attorney General, and Republican State Treasurer don't face state voters until 2014, and neither of Colorado's U.S. Senators are up for re-election in 2012 either.
Republicans will have a Presidential caucus in February, but the Democratic counterpart to that event, assuming that there will be one, will be an uncontested lovefest for President Obama who is currently favored in polling of likely Colorado voters over each of his likely GOP opponents, something boosted by his withdrawal of U.S. troops from Iraq, a sucessful and concluded military intervention in Libya, his reduction in our troop forces in Afghanistan, his successful assassination of Osama bin Laden, and a U.S. economy that while tepid is starting to recover and looks better than the economies of our international trading partners. Given the unimpressive set of potential nominees, Republicans have a grim task ahead of them. The front runner in terms of fund raising and endorsements, Mitt Romney, has failed to excite grass roots Republicans whose support is needed in the primary and caucus process. Michele Bachmann, Rick Perry, and Herman Cain have successively imploded. Newt Gingrinchs campaign collapsed this summer, but someone resurrected itself when all the more charismatic candidates crashed and burned. Ron Paul, Rick Santorum and Huntsman, all of whom have languisted among the also rans for the entire campaign, are now getting sniffs of interest, probably too late to matter, as the GOP activists are reminds of his inadequacies and character flaws, although Newt seems to have picked up most of the pro-adultery vote after Herman Cain dropped out. As of the most recent poll, Colorado voters favored Gingrich, but those preferences have proving exceedingly volatile in the last several months.
Democrats have already secured Colorado Supreme Court approval for the judge drawn Congressional District map that makes incumbent Republican Congressman Mike Coffman in the 6th Congressional District (once one of the safest in the state) much more vulnerable, at the cost of making the 4th Congressional District, which already has an incumbent Republican as well, safer.
Thus, Democrats are the clear winners in the battle to redistrict the state following the 2010 Census in time for the 2012 election. Redistricting has made the likelihood that Democratics will increase the number of Congressional seats they hold in Colorado much greater, has improved the odds that Democrats will be able to wrest control of the state house from Republicans who currently hold a once seat advantage there (a seat itself won by a narrow margin at the height of the Tea Party political surge), and has improved the odds that the Democrats will be able to hold the state senate. Democrats are also in a better position to pick up seats on the state school board and University of Colorado Regents whose districts coincide with the state's Congressional districts, although neither body is very powerful.
Election officials, armed with the legislative district boundaries for 2012 can now start drawing up precinct boundaries. School board, city council and special district seat boundaries also have to be redrawn based on census data, but historically, that has been a comparatively low profile event.
Colorado's Democratic Governor and Lieutenant Governor, Republican Secretary of State, Republican Attorney General, and Republican State Treasurer don't face state voters until 2014, and neither of Colorado's U.S. Senators are up for re-election in 2012 either.
Republicans will have a Presidential caucus in February, but the Democratic counterpart to that event, assuming that there will be one, will be an uncontested lovefest for President Obama who is currently favored in polling of likely Colorado voters over each of his likely GOP opponents, something boosted by his withdrawal of U.S. troops from Iraq, a sucessful and concluded military intervention in Libya, his reduction in our troop forces in Afghanistan, his successful assassination of Osama bin Laden, and a U.S. economy that while tepid is starting to recover and looks better than the economies of our international trading partners. Given the unimpressive set of potential nominees, Republicans have a grim task ahead of them. The front runner in terms of fund raising and endorsements, Mitt Romney, has failed to excite grass roots Republicans whose support is needed in the primary and caucus process. Michele Bachmann, Rick Perry, and Herman Cain have successively imploded. Newt Gingrinchs campaign collapsed this summer, but someone resurrected itself when all the more charismatic candidates crashed and burned. Ron Paul, Rick Santorum and Huntsman, all of whom have languisted among the also rans for the entire campaign, are now getting sniffs of interest, probably too late to matter, as the GOP activists are reminds of his inadequacies and character flaws, although Newt seems to have picked up most of the pro-adultery vote after Herman Cain dropped out. As of the most recent poll, Colorado voters favored Gingrich, but those preferences have proving exceedingly volatile in the last several months.
12 December 2011
Lobato Case Confounds Colorado Budget Makers
A Denver trial court in the Lobato case has held that the State of Colorado has not met its state constitutional duty to provide "a thorough and uniform system of public education." In the full ruling (182 pages), the Court stated that:
The Court's mandate to the state is on the order Of $2-$4 billion. Current state education funding is on the order of $3 billion out of $7 billion. An appeal is certain, and in prior cases of this type in other states, enforcing this kind of order has proven harder than declaring the violation of a state constitutional mandate, often taken years and providing little in the way of concrete results.
Voters rejected a moderate new tax increase for public education in 2011 by a large margin, and except to the extent that this constitutional ruling overrides TABOR, which is also a part of the state constitution and is more recently adopted than the general school funding mandate upon which the judge in the Lobato case relied, any new efforts at school funding will need to overcome the same hurdle. On appeal, the Lobato decision could also be overruled on the grounds that Amendment 23 to the state constitution, which sets minimum funding levels for state education funding in specific dollar terms, covers the same subject more specifically in a more recently adopted provision.
Adequate funding of public education in accordance with the Lobato decision without new tax revenues would eat up all, or very nearly all, of the general fund budget, leaving no funds left for higher education, for prisons, or Medicaid, for mental health services, or for much of anything else.
In this case, as in past school funding cases in other states, it simply isn't obvious that a court order can change the political reality sufficiently enough to allow either the increased taxes necessary to fund education adequately, or the reduced spending on other programs needed to secure education funds, even under the pressure of a court order.
On the other hand, this isn't simply a case of judicial activism by a lone judge. The Lobato case was appealed to the Colorado Supreme Court in 2009 which set forth specific guidelines and mandates for the trial that was just completed, which it has followed:
The Colorado Supreme Court also held on the first appeal that the Plaintiffs wuld prevail if they could prove that:
Given a clear mandate from the Colorado Supreme Court regarding what they had to prove to prevail, and what remedy would result, the Plaintiffs proved their case and the judge agreed and imposed the remedy that the Colorado Supreme Court in its 2009 ruling in this case proposed. As the rulinng further explains:
Given that the trial court viewed its mandate to determine the adequacy of state school funding levels without regard to TABOR, Gallagher, or competiting budgetary constraints, or the costs of providing educationa at all, it is little wonder that the Court found that Colorado didn't spend enough on education.
In essence, the ruling requires the state to first determine what it would cost to meet the aspirational standard for education set forth in the state constitution and the statutes that interpret it, and to promise that at least that much will be spent, and then to find the funds to do so, no matter what it takes to do so. The bottom line order of the Court is that (emphasis added):
From a pratical perspective, this is the straw that has broken the camel's back. The State of Colorado is now clearly overconstrained. No matter how well meaning Governor Hickenlooper and the Colorado General Assembly are in 2012, they do not have the capacity to enact a budget that does not violate one provision of the state constitution or another or one or more federal laws or constitutional provisions, without a vote of the people in favor of a state constitutional amendment or voter approval for ta tax increase, in the face of the political reality that measures similar to the ones necessary for Colorado to meet its state constitutional requirements have been soundly defeated by Colorado voters in the past, repeatedly. So, it is very hard to see what difference one more legislative session of deliberation will make as a reult of this decision.
What Colorado needs is some way to break the Gordian knot of the state constitutional and federal law barriers that stand in its way in this overconstrained environment, perhaps in the form of direction from the courts regarding which of its conflicting obligations it is allowed to breach. Federal law, when mandatory, pre-empts state law, but when it merely assigns consequences fiscally for disobedience, as is the case in the Medicaid program, the case is not so clear. Determining which state constitutional provision can be ignored isn't easy either.
But, the Courts, in depanding action from elective officials, aren't much better situated that the monarchs facing the original legislatures in England and France because they needed tax funds to meet their spending objectives. The principle that I call "sovereignty of the group" comes into play any time voters or a legislature is called upon to decided anything. They act without regard to the existence of outside constraints with impunity, and the process effectively guarantees their right to make decisions that courts or any other rational observer would find to be irrational.
In the end, I don't disagree that education is underfunded in Colorado, but I don't see a politically possible way to resolve the problem unless the Courts give the Governor and legislature the authority to ignore TABOR in order to enact a constitutional funding system for education.
It is also apparent that increased funding will be required. These are appropriately legislative and executive functions in the first instance. Thus, the Supreme Court has directed that this Court shall "provide the legislature with an appropriate period of time to change the funding system so as to bring the system in compliance with the Colorado Constitution."
The Court's mandate to the state is on the order Of $2-$4 billion. Current state education funding is on the order of $3 billion out of $7 billion. An appeal is certain, and in prior cases of this type in other states, enforcing this kind of order has proven harder than declaring the violation of a state constitutional mandate, often taken years and providing little in the way of concrete results.
Voters rejected a moderate new tax increase for public education in 2011 by a large margin, and except to the extent that this constitutional ruling overrides TABOR, which is also a part of the state constitution and is more recently adopted than the general school funding mandate upon which the judge in the Lobato case relied, any new efforts at school funding will need to overcome the same hurdle. On appeal, the Lobato decision could also be overruled on the grounds that Amendment 23 to the state constitution, which sets minimum funding levels for state education funding in specific dollar terms, covers the same subject more specifically in a more recently adopted provision.
Adequate funding of public education in accordance with the Lobato decision without new tax revenues would eat up all, or very nearly all, of the general fund budget, leaving no funds left for higher education, for prisons, or Medicaid, for mental health services, or for much of anything else.
In this case, as in past school funding cases in other states, it simply isn't obvious that a court order can change the political reality sufficiently enough to allow either the increased taxes necessary to fund education adequately, or the reduced spending on other programs needed to secure education funds, even under the pressure of a court order.
On the other hand, this isn't simply a case of judicial activism by a lone judge. The Lobato case was appealed to the Colorado Supreme Court in 2009 which set forth specific guidelines and mandates for the trial that was just completed, which it has followed:
To be successful, [Plaintiffs] must demonstrate that the school finance scheme is not rationally related to the constitutional mandate of a “thorough and uniform” system of public education. The trial court must give significant deference to the legislature’s fiscal and policy judgments. The trial court may appropriately rely on the legislature’s own pronouncements to develop the meaning of a “thorough and uniform” system of education. If the court finds that the current system of public finance is irrational, then the court must provide the legislature with an appropriate period of time to change the funding system so as to bring the system in compliance with the Colorado Constitution.
The Colorado Supreme Court also held on the first appeal that the Plaintiffs wuld prevail if they could prove that:
[T]he [Public School Finance Act] base funding amount and statutory increases are based on "historical compromise," as opposed to a rational determination of the amount it would cost to implement the "thorough and uniform" mandate or the cost of providing an education that meets the standards and goals mandated by education reform efforts. Citing an independent cost study, plaintiffs allege that the current funding levels do not allow students the opportunity to meet the standards and objectives established in education reform legislation. In addition, plaintiffs allege that funding for underserved student populations and capital construction is insufficient and irrationally dependent on local property taxes. Plaintiffs further allege that the state's public school financing system is unconstitutionally irrational because it prevents the district from implementing the education clause mandate at a local level.
Given a clear mandate from the Colorado Supreme Court regarding what they had to prove to prevail, and what remedy would result, the Plaintiffs proved their case and the judge agreed and imposed the remedy that the Colorado Supreme Court in its 2009 ruling in this case proposed. As the rulinng further explains:
Pertinent to the foregoing, in its Order dated July 14, 2011, this Court has previously ruled that:
In the name of the Education Clause, the General Assembly has established a comprehensive system of educational goals, methods, and measures, all of which it requires school districts to implement successfully. A system intended to finance a constitutional mandate cannot be rationally related to that purpose if it is created and funded without reference to the costs of providing the mandated services.
The Court further held that the “General Assembly has expressly linked its duties under the Education Clause with student performance”, and that, therefore: Under the standards-based education system adopted by the General Assembly and implemented by the Defendants, educational opportunity is defined in part by statutorily mandated academic content standards and measured by student achievement or qualitative outcomes. It is but one factor to consider in determining whether the Defendants have met their constitutional duty.
This Court has previously ruled that the following issues raised by the Defendants are not at issue in this case: (1) that public education is not the only required or important state service; (2) that it is rational for the General Assembly to “control the public debt”; (3) that it is rational for the General Assembly to “further local control over instruction” and (4) that it is rational for the General Assembly to “balance appropriations among public services.” The Court has also ruled that the TABOR and Gallagher amendments do not conflict with the mandate of the Education Clause; that TABOR was not intended to restrict the growth of government; and that TABOR should not be interpreted to cripple basic government services, such as the constitutional mandate to establish and maintain a thorough and uniform system of free public schools. Given the remedy specified by the Supreme Court, the interpretation of the Education Clause does not need to be harmonized with either TABOR or the Gallagher Amendment, nor does the Court need to reach the issue of the TABOR revenue restrictions.
Given that the trial court viewed its mandate to determine the adequacy of state school funding levels without regard to TABOR, Gallagher, or competiting budgetary constraints, or the costs of providing educationa at all, it is little wonder that the Court found that Colorado didn't spend enough on education.
In essence, the ruling requires the state to first determine what it would cost to meet the aspirational standard for education set forth in the state constitution and the statutes that interpret it, and to promise that at least that much will be spent, and then to find the funds to do so, no matter what it takes to do so. The bottom line order of the Court is that (emphasis added):
Injunctive relief enters in favor of the Plaintiffs, and all of them, and against the Defendants, and all of them, as follows:
1. Defendants are enjoined from adopting, implementing, administering, or enforcing any and all laws and regulations that fail to establish, maintain, and fund a thorough and uniform system of free public schools throughout the state that fulfills the qualitative mandate of the Education Clause and the rights guaranteed to the Plaintiffs thereunder and that is in full compliance with the requirements of the Local Control Clause; including, without limitation the Public School Finance Act of 1994 in its entirety, categorical funding programs, and capital construction funding laws and regulations;
2. Defendants are further enjoined to design, enact, fund, and implement a system of public school finance that provides and assures that adequate, necessary, and sufficient funds are available in a manner rationally related to accomplish the purposes of the Education Clause and the Local Control Clause;
3. The Court hereby stays the enforcement of the injunctive relief set forth hereinabove in order to provide the State with a reasonable time to create and implement a system of public school finance that meets the mandates of the Education Clause and the Local Control Clause. This stay shall continue in effect until final action by the Colorado Supreme Court upon appeal of the Court’s decision; provided that if appeal is not perfected to the Colorado Supreme Court, this Court shall review the stay upon application of either party submitted no earlier than the conclusion of the 2012 legislative session. While this stay is in place and until further action by the Supreme Court or this Court, the present financing formula and funding may remain in effect.
SO ORDERED this 9th day of December, 2011.
BY THE COURT
Sheila A. Rappaport
District Court Judge
From a pratical perspective, this is the straw that has broken the camel's back. The State of Colorado is now clearly overconstrained. No matter how well meaning Governor Hickenlooper and the Colorado General Assembly are in 2012, they do not have the capacity to enact a budget that does not violate one provision of the state constitution or another or one or more federal laws or constitutional provisions, without a vote of the people in favor of a state constitutional amendment or voter approval for ta tax increase, in the face of the political reality that measures similar to the ones necessary for Colorado to meet its state constitutional requirements have been soundly defeated by Colorado voters in the past, repeatedly. So, it is very hard to see what difference one more legislative session of deliberation will make as a reult of this decision.
What Colorado needs is some way to break the Gordian knot of the state constitutional and federal law barriers that stand in its way in this overconstrained environment, perhaps in the form of direction from the courts regarding which of its conflicting obligations it is allowed to breach. Federal law, when mandatory, pre-empts state law, but when it merely assigns consequences fiscally for disobedience, as is the case in the Medicaid program, the case is not so clear. Determining which state constitutional provision can be ignored isn't easy either.
But, the Courts, in depanding action from elective officials, aren't much better situated that the monarchs facing the original legislatures in England and France because they needed tax funds to meet their spending objectives. The principle that I call "sovereignty of the group" comes into play any time voters or a legislature is called upon to decided anything. They act without regard to the existence of outside constraints with impunity, and the process effectively guarantees their right to make decisions that courts or any other rational observer would find to be irrational.
In the end, I don't disagree that education is underfunded in Colorado, but I don't see a politically possible way to resolve the problem unless the Courts give the Governor and legislature the authority to ignore TABOR in order to enact a constitutional funding system for education.
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