This article originally appeared at McAlvany Intelligence Advisor
Hidden inside an obscure study just released by Barclays is a nugget of huge importance that reflects a sea change in the growth of entrepreneurial capitalism. The results of this development could equal if not exceed those of the
Most obituaries about Hasting’s untimely death in a high-speed fiery single-car crash at 4:30AM on Tuesday morning in Los Angeles dwelled on his primary and most visible contribution to investigative journalism, his authorship of The Runaway General in Rolling Stone magazine which led almost immediately to the
This article first appeared at the McAlvany Intelligence Advisor:
Edward Snowden’s revelations are explosive and continuing, with nearly every major news outlet putting them above the fold ever since the Telegraph published them on June 6th. The secret data-hoovering program called PRISM is now common knowledge and has become part of the lexicon. Bluffdale, Utah, is now essentially a
In a long wide-ranging interview arranged by USA Today on last Friday, three National Security Agency (NSA) whistleblowers and their attorney were grilled about Edward Snowden’s revelations and their reactions to them. They uniformly exhibited a palpable sense of relief that finally someone had been able to break through and get their message into the public square, something they had failed to do on their own.
The three, Thomas Drake, William Binney and Kirk Wiebe along with attorney Jesselyn Radack, the director of the non-profit public interest law firm Government Accountability Project, were asked pointedly
The case is Abington School District v. Schempp, decided on June 17th, 1963, which removed Bible reading from public schools by a vote of 8-1. The court held that laws requiring reading of Scriptures in public schools were unconstitutional.
The only dissenting justice was Potter Stewart and he nailed it:
The current scandals rocking the IRS are giving an excuse for some in the House to threaten shutting off funding for Obamacare. The optimist side of me says, Yea, Do It! The pessimist side says they'll get their funding. The realist side says Obamacare will speed up the bankruptcy of the US.
All funding bills start in the House and I've long wondered why
At the conclusion of Friday’s 2-hour meeting of more than 180 of Detroit’s creditors, unions and pension trustees, Emergency Manager Kevyn Orr’s plan to rescue the city from bankruptcy was met with predictable responses: lawsuits and strikes. It was an altar call to accept reality, but denial, anger and threats were the response of many. One unnamed bond holder said, “It’s just too much. It is an unprecedented amount to ask.” Mike Mulholland, secretary of American Federation of State, County and Municipal Employees (AFSCME) Local # 207, was equally blunt: “When you’re backed into a corner, the only thing you can do is fight and the only way we can fight is to strike.”
Orr was ready for them. In his 134-page proposal, he blamed “financial mismanagement, a shrinking population, [and] a dwindling tax base … over the past 45 years [which] have brought Detroit to the brink of financial and operational ruin.” Indeed, his proposal spelled out the denial of reality that Mayor Dave Bing and his city council had been enjoying for years when it showed that Bing’s people thought that the annual deficit for the city for Fiscal Year 2013 was $47 million when the actual deficit is more than twice that, and for FY 2014 is estimated to approach $200 million. It’s no wonder that Michigan Governor Rick Snyder declared a financial emergency, and appointed bankruptcy attorney Kevyn Orr to take over from the city council in March.
The task facing Orr is horrifying. Faced with more than $18 billion in debts and just $68 million in the bank, Orr started off the meeting by announcing that the city would not make a $40 million payment due that day on a $2.5 billion certificate of participation (COP). He announced further that the city wouldn’t be making $104 million in pension contributions that are currently due either. In addition, retirees hoping that the city would be providing them with health care and full payouts of their pension benefits also received the bad news: they too would be forced to rely on the state’s insurance exchanges to obtain health coverage under Obamacare or Medicare, and could expect significant reductions in their retirement checks as well, approaching $800 a month in many cases.
Orr’s report was equally blunt for those hoping for a miracle: “The City is Insolvent” (Page 7): “the city is not paying its bills,” the city’s infrastructure is deteriorating, “costs associated with unoccupied property” continues to mount, the city’s credit ratings were borderline “bankrupt” by all three agencies, and “Priority One” police response times had increased in just one year from 30 minutes in 2012 to 58 minutes in 2013. In 2012 Detroit “had the highest rate of violent crime of any U.S. city having a population over 200,000 [Detroit’s population is just over 700,000, 40 percent of what it was 1950], five times the national average.”
There are “approximately 78,000 abandoned and blighted structures in the City, nearly half of which are considered ‘dangerous’ [while there are] 66,000 blighted and vacant lots within the City limits.” There are between 11,000 and 12,000 fires in Detroit every year, most of them occurring in those blighted and abandoned buildings.
Orr’s plan, on the surface, is elegant simplicity: if the creditors – pension trustees, unions, bond holders and retirees - will sit still for these massive haircuts, then the city can, under a newly created facility, borrow $2 billion to pay off the $11 billion in unsecured creditors. Orr said that translates, after other demands on that new money, to about 10 cents on every dollar owed. Secured creditors will be better off but they will be asked to take a haircut as well. If the proposal is accepted, lawsuits and strikes notwithstanding, then Orr can take this to court as a pre-packaged bankruptcy, giving him the power to enforce the agreement.
On the other hand, if his proposal can’t get sufficient agreement in the next 30 days from all interested (and now properly chastened) creditors, then he’ll ask the court to grant Detroit bankruptcy protection with himself as trustee. In essence, Orr is dealing from strength: go along with me now and get the best deal possible, or push me and you’ll get less, it’ll cost more and it’ll take longer. Said Orr: “I have a very powerful statute. I have an even more powerful Chapter 9. I don’t want to use it, but I am going to accomplish this job. That will happen.”
There’s a constitutional issue here as well. Under the Tenth Amendment, “powers not delegated to the federal government by the Constitution … are reserved to the states,” which means that guarantees in Michigan’s state constitution that protect pension and retirement benefits from federal bankruptcy rulings could be put at risk in a court battle. If a high court rules that federal bankruptcy laws override state protections, then every pension plan in the country thinking it has state protection will be affected negatively, with national and perhaps even international ramifications. The municipal bond market is nearly $4 trillion in size, and such a ruling could, at the very last, unnerve that market, raising the cost of borrowing significantly, forcing other cities bordering on bankruptcy over the edge.
Michael Sweet, an attorney at Fox Rothschild who helped the city of Redmond, California restructure its finances in order to avoid bankruptcy, noted: “The last thing [union pension funds] may want is for a judge to rule on that … because if the judge ruled on that against them, it would open the floodgates” for similar cases.
This article in the Washington Post perfectly misses, perhaps deliberately, the key issue concerning privacy and the role of government. See if you can pick up on it.
Daniel Solove is the author, and has all the liberal credentials to promote the establishment line: JD from Yale Law School, is an "expert" on privacy with many books on the matter (some of them best sellers), and has been quoted in such mouthpieces as the New York Times, the Chicago Tribune, ABC, NBC, CBS, CNN and NPR. Not a single citation for anything remotely right of center: Washington Times, National Review, American Spectator, etc. So we now where he is coming from.
His thesis: intrusion into our private affairs is concerning, but not too much. He frames his conversation around "myth-busting", which is a
This is quite extraordinary: new car buyers in Los Angeles still like cars with internal combustion engines, despite efforts to move them into electrics. Galpin Ford in Los Angeles is having its summer sale: 10,000 new cars in the next three months. When asked how many of them will be electrics, Beau Boeckmann (whose family ownes the dealership) estimates about
This article first appeared at McAlvany Intelligence Adviser:
During the arm-twisting, the backroom deals, and the promises made (that were later broken) in order to force Congress to pass the hated Obamacare act that is now revealing itself in all its splendor, one little piece of legislation was inserted that is now coming back to bite the same people who voted for it. It’s called the