Neon Notary (photo: Jeremy Brooks/flickr)

All I can say is it’s about damn time somebody in Illinois stepped up to the plate to hold banks accountable for their criminal activities! St. Clair County Recorder Mike Costello and State’s Attorney Brendan Kelly on May 21st filed a civil suit for fraud and deception against 22 banks for allegedly using MERS to “sidestep recording fees” and creating “a scheme to evade county fees and shield property transfer records from the public.” As State’s Attorney, Mr. Kelly works with and advises government at the county level, while the Attorney General provides the same services at the state level. Additionally:

We have been hearing from deputy recorders that kept having questions raised by individual home owners doing title searches,” he said. “With MERS it is very difficult to ascertain who owns what with any given piece of property.”

“It turns out that the replacement system is very inaccurate with very little oversight,” he said.

He said Illinois law is “clear and strong” regarding recording laws, but that MERS is in violation of various statutes including unjust enrichment, consumer fraud and deceptive trade practices.

Considering that St. Clair County was one of twelve Illinois counties contacted by Illinois Attorney General Lisa Madigan in July 2011 regarding an investigation into MERS that she was starting, they must feel that AG Madigan’s investigation is either going nowhere, or was dropped once she signed onto the 49-state “settlement” earlier this year. AG Madigan was one of the main negotiators for that “settlement”, but apparently had no intention of actually prosecuting the banks for their criminal activities leading up to and after the housing bubble broke. The 12 counties contacted were asked to research and submit documents listing MERS as one of the parties to a property. Each county has different guidelines as to what and how documents are recorded, so some counties have nothing more than an electronic record and others have paper copies. The other 11 counties are Champaign, Dupage, Lasalle, Madison, Kankakee, McHenry, Rock Island, Sangamon, Vermillion, Whiteside and Winnebago.

Since I live in Dupage County, I had occasion to speak to that County Recorder’s office about AG Madigan’s investigation in early February this year. They said her office had been in contact with them as late as that week, and that they were in regular communication regarding this issue. The week I spoke to them was in between the SOTU and when the 49-state “settlement” was announced. In addition to the MERS investigation, we discussed the documents in their possession and what they were doing toward any fraud involved (it should be noted that Dupage County only keeps electronic files). I was pretty shocked at their answer to my fraudulent document question since they don’t feel it is their responsibility to “make a judgment call as to the validity of any documents in their possession.” Basically, they have no idea if they possess any fraudulent documents unless the court informs them of that fact. While I could not find an estimated loss amount for St. Clair County, Dupage County is very conservatively estimating their loss of recording fees at $20 million.

Though St. Clair County has apparently been considering this for months, the timing for filing this civil suit is also interesting because the Illinois Supreme Court’s Mortgage Foreclosure Committee (established in April 2011 and discussed here) is in the middle of their Public Hearings to “update” the Illinois Mortgage Foreclosure Law. This is not something that has been widely published, so their April 27th Practice and Procedure Subcommittee’s hearing attracted mostly the bank’s foreclosure law firms and MERS to testify, with only 1 or 2 token law firms that represent homeowners. The written testimony is quite interesting, not to mention illuminating, and though the Committee’s initial suggestions to “improve” the law appear to be innocuous, it is not unreasonable to believe that they will make changes based on what is suggested at these hearings. There were no homeowners or homeowner advocacy groups included as members of this Committee, which is reprehensible – but not surprising – considering the serious nature of foreclosures and how those negatively affect not only the families, but the neighbors and communities where they are located.

I urge everyone to go to their website and read the suggested changes to the law, as well as the April 27th testimonies. The next Public Hearing on June 8th is for the Loss Mitigation Subcommittee’s recommendations – but how that relates to the Illinois Mortgage Foreclosure Law is not apparent since there is no corresponding text now. Though it’s possible that loss mitigation language is being considered for insertion into the current law, is it intended to be a new clause or to replace a currently existing clause?

The upcoming June 8th hearing is the last one scheduled before the law is revised, and though the deadline for submission of testimony and addition to the speaker’s list is this Friday, there is time to organize a protest so the Very Important People know that the people of this state don’t want banks/Wall Street and their foreclosure mill attorneys to write or revise our laws!

Nancy Pelosi calls for extending tax cuts for income up to $1 million (photo: Talk Radio News/flickr)

We are still months away from the so called “fiscal cliff” or “taxmaggedon” when among other things the Bush tax cut extension expires.  But the Democratic leadership has already started negotiations against itself. With negotiations with the GOP not having really begun, Pelosi has already moved the Democratic ask to the right in a preemptive surrender. From Pelosi’s letter to Speaker John Boehner:

Without further delay, the Majority Leadership should schedule a vote on extension of the middle-income tax cuts, as early as next week, to increase certainty for millions of American taxpayers and for the economy. We should not delay passing this legislation that will help afford all Americans the opportunity to reach their goals and realize the promise of the American Dream.

We must ask the very wealthiest Americans to pay their fair share. Democrats believe that tax cuts for those earning over a million dollars a year should expire and that we should use the resulting revenues to pay down the deficit.

By ensuring that the middle-income tax cuts do not expire, we will put money into the pockets of American consumers, saving the typical middle-income family thousands of dollars per year. Extension of this middle-income tax cut will inject demand into our markets and strengthen small businesses. By investing in both the short-term growth of our economy and the long-term prosperity of our nation, it will empower the entrepreneurial spirit of the American people. We cannot afford another manufactured crisis that unnecessarily threatens the full faith and credit of the United States and jeopardizes our economic recovery.

*emphasis mine

Since President Obama began his campaign back in 2007, the plan was to let the tax cuts expire for those making over $250,000 a year. While the process has been slow, the Democratic leadership’s line now seems to have been officially moved up to only ask the tax cuts expire for those making over $1,000,000 a year. This is really moving the goal post without any concession on the other side.

Given that Democrats didn’t actually end the Bush tax cuts for those making over $250,000 when they had the opportunity to do so easily using reconciliation in either 2009 or 2010, I’m forced to question whether the Democrats really ever wanted to see taxes on this group return to levels in the Clinton era.

If this is an actual policy negotiation move by Pelosi, it would be pathetic.  But if Democrats’ past behavior means that they intended to only ever use this as a political talking point but never implement it, they might as well switch to some number that sounds better in a 30 second TV ad. I suspect the change was purely for political reasons, because “one million dollars” rolls off the tongue and polls slightly better than $250,000. If it’s all meaningless political posturing, we might as well go with the best sounding posture.

Regardless whether this move is an act of pure political cynicism, preemptive compromise or some combination of the two, it hardly makes the Democrats look good.

Outgoing NRC Chmn. Jaczko testified before the House Committee on Oversight and Government Reform last year.

The Chairman of the Nuclear Regulatory Commission, Gregory Jaczko, submitted his resignation Monday morning. Chairman Jaczko, a former aid to Senator Harry Reid (D-NV) and Representative Ed Markey (D-MA) who holds a PhD in particle physics, was originally appointed to the NRC in 2005, and elevated to chairman in 2009. Jaczko said he will relinquish his post upon confirmation of a replacement.

Jaczko’s announcement is hard to separate from pressing questions about the safety of commercial nuclear power in the United States–especially in the context of the ongoing crisis in Japan–the debate over the future of the Yucca Mountain nuclear waste repository, signs of shifting power dynamics in Washington, and, perhaps most importantly, the influence of wealthy and well-connected private industry on public policy.

As has been discussed here before, Greg Jaczko has been at the center of an orchestrated controversy for much of the last year, with nuclear industry lobbyists, Republican members of Congress, and other NRC commissioners pressing for the chairman’s ouster. Representative Darrell Issa (R-CA), head of the House Committee on Oversight and Government Reform, has been an especially dogged critic of Jaczko, holding hours of hearings and serving as the driving force behind two inspector general reports on the allegedly hostile workplace environment at the NRC.

Issa, it must be noted, represents a district that includes the extremely troubled San Onofre Nuclear Generating Station (SONGS). The plant is currently offline as regulators try to determine the root causes of radiation leaks and rapid degradation of copper tubing used to move radioactive steam in and out of the reactors. The Orange County Republican has received copious campaign contributions from the companies that operate and maintain San Onofre.

Issa called hearings (while calling for Jaczko’s head) last year after the four other commissioners made public their letter to the White House complaining about Jaczko’s managerial style. The complaint revolved around a handful of issues that help explain the apparent urgency behind the anti-Jaczko putsch.

First, critics were upset about the way that Jaczko helped end work on the Yucca Mountain nuclear storage site. Yucca had proven problematic for a number of reasons–environmental, economic, security, and social–and had long been the target of Nevada politicians (most notably, Senate Majority Leader Reid), who felt their state had been dealt with unfairly in the original selection process.

The Obama administration had seemed to agree, and had the Department of Energy withdraw a request for the licensing of Yucca Mountain. In addition, very little money remained in Yucca’s budget, and no more has been approved.

But the nuclear industry desperately needs an answer to the problem (crisis, really) of long-term nuclear waste storage, and Yucca Mountain is the only site that has even been started. (It is nowhere near finished.) Without a place to move “spent” fuel and the other dangerous detritus of the process, nuclear power cannot realistically expand the number of rectors in the US, nor can it long continue to maintain and refuel those already in operation.

The nuclear industry, through its proxies in Congress and on the NRC, has complained that Jaczko didn’t allow advocates for Yucca to perpetuate the process. Most recently, a fight went public when President Obama nominated NRC Commissioner Kristine Svinicki for another term over the vocal objections of Senator Reid and his colleague Barbara Boxer (D-CA). Of special contention, the role Svinicki played in drafting the documents that called for the construction of the Yucca repository.

Second, the dissenting NRC commissioners complained that Jaczko used his emergency powers as chairman to guide US policy in the immediate aftermath of the earthquake and tsunami that caused a triple-meltdown at Japan’s Fukushima Daiichi nuclear power facility. Complainants seem especially upset that Jaczko recommended evacuation of American citizens from a 50-mile radius around the crippled nuclear plant–a call he made with the support of NRC experts and in coordination with the State Department. Radioactive contamination from Fukushima has, of course, been found across Japan, even beyond the 50-mile limit. (In the US, 65 percent of the population lives within 50 miles of a nuclear plant, and late in December, federal regulators moved to scale back requirements for evacuations and emergency drills around commercial reactors.) [cont'd.]

In the wake of the initial accident, Jaczko sought recommendations for US nuclear safety. The Near-Term Task Force (NTTF) Review of Insights from the Fukushima Dai-Ichi Accident produced a collection of basic (and, as discussed here, rather weak) recommendations last summer. Chairman Jaczko tried to start the process of turning those recommendations into rules–a process that could stretch beyond five years–but met objections from each of the other four commissioners. Jaczko also wanted lessons learned from Fukushima included in construction and licensing permits granted to four AP1000 reactors (two to be built in Georgia, two in South Carolina), but the chairman was outvoted four-to-one by his fellow NRC members.

The third (and most often referenced) complaint fired at Jaczko was that he had created a “hostile work environment,” especially for women. Though Svinicki, the only woman on the commission, lamented Jaczko’s tone, the specific “charge” (if it can be called that) was brought by Commissioner William Magwood. Magwood said there were female staffers that Jaczko had brought to tears, though none of those women personally came forward (because, it was said last year, they did not want to relive the humiliation).

The story gained extra prominence when Senate Minority Leader Mitch McConnell (R-KY; Kentucky, by the way, home to a nuclear waste nightmare called Paducah) attempted to use this alleged incident to disrupt the rising narrative of the Republican “war on women.” McConnell and others from his side of the aisle took to the microphones to denounce the administration’s treatment of whistleblowers and praise the apparently brave and much put-upon Svinicki.

In what seems to be a rare case where the public’s relative lack of interest in nuclear regulation can be called a positive, McConnell’s gambit failed. . .

. . . at least in derailing the “War on Women” story. (It also probably owes much to the GOP actually continuing its war on women.)

But when it came to serving the nuclear industry, McConnell’s contribution to the ouster of Jaczko will likely be rewarded. . . with industry contributions of the monetary kind.

Chairman Jaczko’s resignation comes just before issues of his workplace demeanor would likely again dominate headlines (if, again, any story regarding nuclear regulation can be imagined to dominate this year’s headlines), as a second IG report on the NRC work environment is due next month, and Issa had already promised more hearings. But Jaczko’s announcement would likely not have come without the intervention or, at least, tacit blessing of Senator Reid. As mentioned, Reid has been Jaczko’s best friend on the Hill, and Jaczko has helped Reid and the Obama administration move away from making Nevada the final resting place for a country’s worth of hazardous nuclear waste.

After President Obama defied Reid’s private and public requests, and nominated Kristine Svinicki for another term as NRC commissioner, the Senator had a choice to make–and some political calculations to do.

While, to the nuclear industry, Jaczko represented an insufficiently pliant regulator–be it concerning NTTF recommendations, fire safety rules, or waste storage–to Harry Reid, the NRC chairman is most importantly a staunch opponent of the Yucca project. And Jaczko is the only one of the five NRC commissioners who meets that description. With Jaczko’s public image under attack and his ability to function as chairman challenged by the other commissioners and nuclear-friendly forces in Congress, questions of how much longer he could survive would have continued throughout the year. With that baggage, and with Senator Reid’s Democratic majority and possibly even his leadership position up in the air come November, there seems little chance that Obama would have shown Jaczko the same deference he did Svinicki and offered to nominate him for another term when the chairman’s current one expired in 2013.

As it is custom for NRC commissioners to be nominated in pairs–one from the Democrats, one from the Republicans–to smooth their paths to confirmation, Reid likely looked at Jaczko’s predicament, Svinicki’s nomination, and his own future and saw this as a moment to make some lemonade out of a crate of rotting lemons.

Act now, and Reid would play a prominent role in choosing Jaczko’s replacement–who could theoretically get confirmed alongside Svinicki for a full, five-year term–wait, continue to back Jaczko and fight the administration and the GOP on Svinicki, and the best Reid could hope for is a year of controversy over NRC personnel and an uncertain amount of influence in shaping the future of the Nuclear Regulatory Commission.

Indeed, current reporting is that the White House will move quickly to nominate Jaczko’s replacement (and rumors are it will be a woman), and that the administration is in consultation with Reid to choose someone he will help move through the Senate confirmation process. It is hard to believe Reid will look kindly upon any nominee interested in re-starting the Yucca Mountain process.

. . . timing

It is said that, in life, timing is everything. In politics, money probably keeps timing from cornering the be-all-end-all market, but timing has played a part in the NRC’s saga. As Reid hopes to use this moment to keep his objectives on course, the nuclear industry is trying to desperately to turn back time to an era where the term “nuclear renaissance” wasn’t said with a smirk and a glance eastward toward Japan.

As with Yucca Mountain, where atom-loving electeds and regulators scramble to get the federal government to take their waste–with its risks and expense–off of the nuclear industry’s hands, the threat of new safety rules (and their perceived expense) emerging from the post-Fukushima review also motivated a profit-centric industry to step up their efforts to remake the NRC in their own image.

As noted here in December, Darrell Issa’s public release of the commissioners’ letter complaining about Jaczko was oddly timed:

[T]hough the commissioners’ complaint was written and delivered to the White House in October, it was only made public by Rep. Issa last Friday. A slot usually reserved for news dumps seems like bad timing if Issa and his allies wanted to create a splash, unless you consider that Rep. Ed Markey (D-MA) had planned to release a report on Monday showing how NRC commissioners had coordinated with pro-nuclear legislators to slow or stop post-Fukushima safety reforms. Markey’s report (PDF) includes emails revealing commissioner Magwood and staffers for pro-nuclear Sen. James Inhofe (R-OK) worked together to discredit Jaczko for taking the lead on the US regulatory response to Fukushima.

And as reported in October, this behavior was not new for Magwood. During his time at the Department of Energy, Magwood held private meetings with top nuclear industry lobbyist Marvin Fertel. In December, Ryan Grim of The Huffington Post detailed–in a scenario eerily similar to what culminated this week–how Magwood and his industry friends worked behind the scenes to oust his superior at DoE.

It also deserves mentioning that between his time in the George W. Bush Energy Department and his appointment to the NRC by President Obama, Magwood formed the consulting firm Advanced Energy Strategies, whose clients included not only TEPCO, the nominal owner of Fukushima Daiichi (until the Japanese government finishes its bailout/buyout), but a veritable who’s who of the Japanese nuclear elite.

As discussed above, Jaczko was the only NRC commissioner who voted to include future post-Fukushima rules in the licensing requirements for new reactors in Georgia and South Carolina. Both those projects are still wanting for full financing, and Georgia’s reactors are already behind schedule and, as revealed recently, nearly $1 billion over budget. The last thing the industry wants to see are demands for pricy safety upgrades or reminders of all that can go wrong at a nuclear plant. Jaczko’s desire for inclusion of Fukushima “lessons learned” held out a threat (however weak) of both.

Weak in review

But it was the rather weak recommendations, the glacial pace of change, and the seemingly futile lone votes against four other commissioners in the nuclear industry’s hip pocket that also helped end Jaczko’s run as NRC chair.

Theoretically, election cycles are when elected officials are most responsive to public pressure, but what part of the public felt particularly compelled to fight on Jaczko’s behalf? As stated during an earlier act in this power play, the nuclear industry and its acolytes were never going to see Jaczko as anything but the enemy, but the chairman’s “moderate” response to the Fukushima moment, along with the continued granting of license extensions to aging nuclear plants, and his oft-repeated statements of faith in the broken regulatory process left Jaczko with no strong allies in the anti-nuclear movement. Between the ongoing Fukushima disaster and the dynamics of an election year, the timing could have been favorable for a regulator bold enough to dare to regulate.

Instead, Chairman Jaczko, who no doubt saw his split-the-middle path as a reasonable one, was left alone to watch as his colleague, Bill Magwood, helped orchestrate a coup, and as his benefactor, Harry Reid, moved to cut his losses. For America, however, losses have not been cut–nuclear power is still a perpetual economic sinkhole and a looming ecological disaster–and no matter how the politicians try to massage the regulatory process, the science that makes nuclear power so untenable remains constant.

Constant, too, is the global trend–most of the industrialized world is turning away from this dirty, dangerous, and exorbitantly expensive way to boil water. Jaczko’s chairmanship of the Nuclear Regulatory Commission may be at its dénouement, but that does nothing to magically create a nuclear renaissance. The good and bad news here is that all of nuclear power’s problems are just as real and just as pressing, with or without Greg Jaczko.

The 2012 NATO Summit in Chicago has been one of the most anticipated events in the Occupy Movement since it started. Mimicking the tactics of the NATO representatives in Chicago, police raided an apartment in Bridgeport with out a warrant.

FDL Dissenter’s Kevin Gosztola will give us some background information based on his coverage of the five activists arrested during a raid on a South Side Chicago apartment and held without charge. They were arrested during the night around 1 a.m. on May 17, along with four other activists who have since been released.

Join our discussion on The NATO 5: Occupy & The War On Terror on Wednesday 5/23 at 8:00pm

Among the activists arrested were MyFDL Blogger TarheelDem and Darrin Annussek who walked to Chicago as part of “Occupy The Highway.” The remaining group, now being called the NATO 5, was held under suspicion of terrorism without trial.

Kevin Gostola will be joined by TarheelDem and others involved in this weekend’s protests, to talk in-detail about what happened.

Click here to register: https://www3.gotomeeting.com/register/940458030

For More Information Check Out Kevin’s Blog Posts on This Topic

http://dissenter.firedoglake.com/2012/05/17/police-preemptively-raid-apartment-arrest-activists-ahead-of-nato-summit/

http://dissenter.firedoglake.com/2012/05/18/activists-raided-arrested-ahead-of-nato-summit-continue-to-be-held-without-charge/

http://dissenter.firedoglake.com/2012/05/18/cpd-chief-wont-talk-about-night-raid-that-resulted-in-disappearing-of-activists/

http://dissenter.firedoglake.com/2012/05/19/nato-3-came-to-chicago-to-commit-terrorist-acts-of-violence-cpd-fbi-secret-service-claim/

http://dissenter.firedoglake.com/2012/05/20/occupy-journalists-stopped-searched-handcuffed-interrogated-at-gunpoint/

http://dissenter.firedoglake.com/2012/05/21/the-preemptive-prosecution-of-the-nato-5/

Former Sen. Alan Simpson of Bowles-Simpson fame

Alan Simpson, the most avuncular-looking Mean Girl in Washington, is back at it again. He fired off a letter to the California Alliance of Retired Americans, months after making an appearance in the Golden State that included a protest by this group. It was clearly eating at his soul so much that he had to “set ‘em straight” on how they should shut up and take the reduction of future Social Security benefits for all Americans with some more dignity and grace:

To Whom It May Concern:

Erskine Bowles and I thoroughly enjoyed our time on the West Coast and received an excellent reception from folks — at least those who are using their heads and have given up using emotion, fear, guilt or racism to juice up their troops. Your little flyer entitled “Bowles! Simpson! Stop using the deficit as a phony excuse to gut our Social Security!” is one of the phoniest excuses for a “flyer” I have ever seen. You use the faces of young people, who are the ones who are going to get gutted while you continue to push out your blather and drivel. My suggestion to you — an honest one — read the damn report. The Moment of Truth — 67 pages, and then tell me if we’re not doing the right thing with Social Security. What a wretched group of seniors you must be to use the faces of the very people that we are trying to save, while the “greedy geezers” like you use them as a tool and a front for your nefarious bunch of crap. You must feel some sense of shame for shoveling out this bulls**t. Read the latest news from the Social Security Trustees. The Social Security System will not “hit the skids” in 2033 instead of 2036. If you can’t understand all of this you need a pane of glass in your naval so you can see out during the day! Read the report. Get back to me. My address is below.

If you don’t read the report, — as Ebenezer Scrooge said in the Christmas Carol, “Haunt me no longer!”

Best regards,
Alan Simpson

Simpson dated the letter April 6, but it didn’t get to California until this week, suggesting that the cost-conscious former Senator prefers to use the more frugal method of postal delivery, the Pony Express.

I actually have read The Moment of Truth so you don’t have to, and I can say confidently that the section on Social Security only makes sense if you believe, as Simpson does, that elderly Americans are “greedy geezers” living high on the hog on their average of $13,000 a year in Social Security benefits. If you think they are robbing the system with their $1,100 a month, and ruining things for everyone else, if they think that the program could do with lowering that king’s ransom while still being adequate to keep older Americans out of poverty, given that it’s the main income source for a large chunk of them, then you’re in league with Alan Simpson. If not, you’re just part of the world’s biggest milk cow, the one with 310 million tits.

Nan Brasmer, the President of CARA, responding by saying that Simpson’s remarks “insult the intelligence and dedication of retiree activists who worry about their children and grandchildren’s future.” But what does she know: she’s so privileged she gets to retire at 67!

"Bully Pulpit" President Theodore Roosevelt, 1904 (Wikipedia)

Since President Obama publicly stated that he personally supports same-sex marriage, we have seen support grow at both the national and state level. While support has grown among most groups, much of the growth has come from Obama’s biggest supporters, African-Americans. From PPP:

Pennsylvania voters still oppose gay marriage but they have moved by 7 points on the issue since PPP polled the state in November. 39% support it to 48% opposed. That 9 point margin is down from 16 points at 36/52 last fall. The most notable movement over that period of time has come with African Americans. They now narrowly support gay marriage, 42/41, after previously opposing it by a 52/34 margin.

We’ve seen that kind of dramatic movement with black voters in North Carolina as well. While the media has been very focused on the question of how Barack Obama’s announcement on gay marriage will affect his own reelection prospects (not much) the bigger question might be how it’s going to affect overall public opinion on gay marriage. The answer so far- at least with black voters- is quite a bit.

Given the demographic breakdown, support for marriage equality was destined to grow regardless of what Obama did.  But his public endorsement helped to accelerate the trend. He brought attention to the issue, which caused some including many of his biggest supporters to re-examine their opinions on the matter.

The bully pulpit is not some magic device that can reshape politics on every issue, but it is a real tool of the president that can be quite powerful in particular circumstances. Whether the issue is the build up to the war in Iraq, bombing Libya or marriage equality, a president and his administration speaking out forcefully for something can really shape popular opinion, especially among the president’s base.

More on the President’s “bully pulpit” from David Dayen.

House Minority Leader, Nancy Pelosi asks to extend Bush Tax Cuts up to $1 million

House Minority Leader Nancy Pelosi, responding to an expected acceleration of John Boehner’s timeline on the Bush tax cuts, fired off a letter to the Speaker asking for immediate consideration of an extension of just the “low end” tax cuts – which include the Bush-era marginal rates for households making up to $1 million. This represents a shift in the dividing line for the Bush tax cuts, which has traditionally been at $250,000.

The Bush tax cuts at every level up to $1 million in annual income, in other words, are now framed as “middle-income tax cuts.” She says it right here in the letter:

Without further delay, the Majority Leadership should schedule a vote on extension of the middle-income tax cuts, as early as next week, to increase certainty for millions of American taxpayers and for the economy. We should not delay passing this legislation that will help afford all Americans the opportunity to reach their goals and realize the promise of the American Dream.

We must ask the very wealthiest Americans to pay their fair share. Democrats believe that tax cuts for those earning over a million dollars a year should expire and that we should use the resulting revenues to pay down the deficit.

First of all, if you make the dividing line at $1 million a year in annual income, there simply won’t be all that many revenues generated to pay down that deficit. When the dividing line was $250,000 a year, the revenue was around $800 billion over a ten-year period. I don’t have a strong grasp of what the numbers would be at $1 million, but my guess would be half that, if not more. So from a deficit reduction standpoint, this makes pretty much no sense.

Second of all, because of our marginal tax rate system, high-income earners at the $1 million
level would still benefit from all the tax cuts on the first $1 million of their income, which are substantial. In fact, you’d be giving hundreds of billions of dollars – whatever the difference is between letting the tax cuts expire at the $250,000 level and the $1 million level – entirely to well-off people.

Over time, this completely constrains progressive governance, at least in the current era where budgetary theory favors so-called fiscal responsibility over the long term. It was already a mistake to keep the Bush tax cuts on the first $250,000 of income and to try and make the dividing line there, as those tax cuts are simply not well-designed, and even the “low-end” tax cuts favor the rich to a larger degree, especially when you mix in the estate tax and other tax issues. Raising that bar to $1 million only exacerbates this.

A millionaire’s bracket, as many have suggested, makes sense in the context of adding it onto the Clinton-era rates. To just return to Clinton-era rates at that level locks in historically low tax rates for a large swath of wealthy people.

Fortunately, John Boehner is so solicitous of millionaires that he will reject this. Which means that the alternate theory, to let all the Bush tax cuts expire and then come back with a new regime to transform the tax code in a progressive way after the fact, is still a possibility, if gridlock ensues as expected.

Sen. Sherrod Brown (D-OH) warned in the JOBS Act that IPOs shouldn't be exempt from providing key information to investors

Facebook has bounced back a bit today on its initial stock offering, but it’s still way down from the IPO price. And the company – and those that helped bring it to NASDAQ – have much bigger problems:

Morgan Stanley (MS) defended its role in Facebook Inc. (FB)’s initial public offering after a Massachusetts regulator subpoenaed the bank over talks between an analyst and investors about the social media company’s revenue outlook [...]

William F. Galvin, Massachusetts’ secretary of the commonwealth, said his securities division subpoenaed Morgan Stanley over talks between Scott Devitt, the research analyst, and the firm’s institutional investors about Facebook’s revenue.

Those communications also may be “a matter of regulatory concern” to the Financial Industry Regulatory Authority, the industry-funded brokerage watchdog, and the U.S. Securities and Exchange Commission, Finra Chief Executive Officer Richard Ketchum said yesterday in an e-mail.

Research employees may communicate with investors if they don’t do it jointly with investment-banking employees or managers of the firm that’s going public, according to the terms of the 2003 Wall Street research settlement. Companies paid $1.4 billion to settle regulators’ allegations that they published misleading research to win investment-banking business.

Say, this reminds me of something. I can’t quite put my finger on it… oh yeah! Didn’t Congress just pass a law that removes multiple transparency rules for IPOs, in addition to gutting the firewall between investment bank analysts and research specialists related to IPOs? And wasn’t it called the “JOBS” Act?

“Under the JOBS Act, affiliated analysts are able to jump in and talk to institutional investors,” Ritter said.

In addition, there’s an incipient shareholder lawsuit in process that will argue that Facebook, the social networking company omitted key information as well as made false statements in their IPO documentation. Of course, the JOBS Act would remove much of the information an IPO needs to provide to investors.

So in other words, exactly what the investigators are looking at in this case, exactly what shareholders want to sue over in this case, and exactly what the Senate Banking Committee wants to probe in this case, happens to be exactly what Congress and the President perpetuated by signing the JOBS Act. Facebook operated under the old rules and they might get nicked for it, but they would be the last.

Sherrod Brown made specific reference to this in his statement on the Facebook situation:

Effective capital markets require transparency and accountability, not one set of rules for insiders and another for the rest of us. There’s a lot that we don’t know about this IPO but a lot that we do. We know that the SEC must fully investigate and take appropriate action if it discovers any violations. The conduct in this highly-publicized IPO only reinforces that the Senate was mistaken in voting to remove oversight from approximately 98 percent of all IPOs—for companies making less than $1 billion per year.

Brown didn’t vote for the JOBS Act, but plenty of members of Congress on both sides did. They don’t have the right to grandstand about Facebook and Morgan Stanley for the next month.

New poll shows majority support for legalized, regulated marijuana (photo: Duncan Brown "Cradlehall")

A solid majority, 56 percent, of registered American voters favor legalizing marijuana and regulating it in a manner similar to alcohol and tobacco, according to a new Rasmussen poll. Only 36 percent of the country is opposed to legalizing and regulating cannabis. This represents one of the highest levels of support for marijuana legalization ever in a national poll.

The same poll also found that support for marijuana legalization went up even higher if the poll question made it clear that the sale of cannabis would be very tightly regulated. A full 58 percent of voters would support legalizing marijuana if it was regulated so that it could only be sold in pharmacies. The poll found just 32 percent would still oppose legalizing marijuana even if tightly regulated.

Stressing that legalized marijuana would be well regulated is very important to winning over some undecided voters on this issue. There are many people who don’t use marijuana, but they think prohibition has proven to be an unworkable and costly policy mistake. That doesn’t mean, though, that this group wants no restrictions on marijuana sales, making it as easy to buy as bubble gum. Their basic opinion seems to be that the government should tolerate adult marijuana use, but they still want the government to regulate and discourage its use.

It seems that every few months there is a new national poll confirming that support for legalizing and regulating marijuana is steadily growing. Given the current polling trends, it is not a question of whether states will start legalizing it but when.

German Chancellor Angela Merkel doesn't support collective Eurobonds (Wikipedia)

A European summit being held tonight in Brussels offers another opportunity for new French President Francois Hollande to offer a different manner of thinking on the euro crisis, away from austerity and toward integration through eurobonds, fiscal transfers and economic growth. On the first part, however, Germany has all but ruled out eurobonds, which would create collective credit risk across the Eurozone, and smooth out the bond spikes that have occasioned the crisis in the peripheral countries like Spain, Italy, Greece and Portugal.

Officials from Germany, the continent’s industrial powerhouse, say that they remain implacably opposed to a proposal to allow euro-zone countries to borrow money with the backing of all 17 countries that use the currency — an idea that has been pushed by French President Francois Hollande and others — but that they are open to the possibility of smaller measures. Emphasizing the stakes, a major economic organization said Tuesday that Europe is teetering, as it forecast recession for the euro zone and growth for the United States [...]

“You can wake me up in the middle of the night, at 3 a.m., and I will tell you our position. Or 5 a.m., it doesn’t matter. We think that euro bonds are not the right path for many reasons,” a senior German government official told reporters in Berlin, under a customary ground rule of anonymity.

The idea that there are “smaller” measures that can be agreed upon neglects the fact that eurobonds are in and of themselves a smaller measure than, say, European Central Bank accommodation or a higher inflation target or straight current account transfers from Germany and the northern states to the southern periphery. Germany, which stands to risk the most in the near term from eurobonds, since they’d be at risk for defaults on bonds issued for weaker economies, wants the kind of austerity measures they feel will reduce budget deficits to go into effect first. If in fact that did reduce deficits, they feel this would smooth out the credit spreads and make eurobonds less of a risk to Germany. But this assumes, contrary to all evidence, that more austerity would even reduce deficits. All it has done so far is to send the Eurozone into recession, reducing revenue intake and keeping the deficits in the same place or worse.

So Germany remains implacable. And on the other end of the spectrum, far-left Greek leader Alexis Tsipras has basically gotten nowhere in his efforts to build a wall of opposition to German-led policies. He has no actual power at the moment, however, so his trips to Paris and Berlin never quite made sense to me.

Perhaps Hollande can muster that coalition. But it looks to me like it will take an escalation of the crisis to get any change in direction from Germany.