I’m just too angry to write about it. Read Will Bunch. Don’t skip the comments.
And once again, let me remind you this is merely a plan to bust the union and bring in newbie teachers who will work cheap. Here in Philly, they even built subsidized housing to underwrite their shitty salaries!
David Dayen has a piece in the Financial Times that explains another reason Republicans want the Consumer Financial Protection Bureau to fail: Because they can shut down bad banks in a way the Department of Justice can’t:
After This American Life recently removed the mystery from the New York Federal Reserve’s cozy relationship with Goldman Sachs, multiple writers have offered their take on what financial regulators in America do wrong. But this week, we got an example of a regulator getting something right. If others follow their lead, we could finally get a more stable financial system.
The Consumer Financial Protection Bureau’s new rules on mortgage servicing took effect this year. Servicers collect monthly payments from homeowners, and make decisions on loan modifications and foreclosures. And they happen to be universally terrible at it, for reasons I’ll explain later.
On Monday, CFPB cited Michigan-based Flagstar Bank with violating the new rules.
And it violated them in earnest. In 2011, years after the start of the foreclosure crisis, Flagstar had 13,000 active loan modification applications, but only 25 full-time workers and an application review center in India. The backlog became unbearable, taking up to nine months to assess an application. And Flagstar would deal with applications that contained outdated information by simply throwing them out. These actions continued to the present day.Flagstar frequently failed to tell borrowers their applications were incomplete. It prolonged the decision-making process, despite specific CFPB deadlines for telling a borrower if it would modify their loan. Flagstar illegally denied loan modifications when borrowers qualified under its rules. It gave no explanation for the denials, a violation of CFPB rules. And it lied to customers about their rights to appeal the denials, another violation.
“Struggling homeowners paid a heavy price, including losing the opportunity to save their homes, as a result of Flagstar’s illegal actions,” said CFPB director Richard Cordray, who announced the enforcement action.
CFPB has in the past sanctioned mortgage servicers for similar violations, with limited success. This time, in addition to fining the bank $37.5 million (the bulk of which will go to victims of Flagstar’s bad servicing, who also must be offered new loan modifications), CFPB banned the company from acquiring new mortgage servicing rights, particularly for defaulted loans, until it can demonstrate its ability to comply with the law.
This is enormous. There’s a healthy trade in the right to service loans in default, because new capital rules make them less attractive to large banks, and because CFPB’s regulations are costly to follow. Because servicers don’t originate a massive amount of loans themselves, and because consumers constantly refinance, pay off, or lose a loan to foreclosure, servicers must constantly purchase new servicing rights to refresh their supply and stay in business. But CFPB ordered Flagstar to not purchase any more default loan servicing until it figures out how to do it properly. This “benching remedy,” as Georgetown law professor Adam Levitin calls it, can change the calculations for financial institutions over whether to commit a fraud, where the potential penalty is usually less than the profit they can make. In this case, Levitin writes, “compliance can be costly, and being taken out of the market can really squeeze the firm’s market position and potentially even its cashflow.”
Imagine applying this model to other parts of the financial services industry. Firms guilty of securities fraud could be barred from issuing that set of securities. Companies making high-risk corporate loans outside regulatory guidelines could be stopped from making corporate loans entirely. Banks caught laundering money for sanctioned organizations could be barred from U.S. dollar clearing operations, or from taking new deposits.
The message would come through clearly: Violate the law and you no longer get to participate in the business until you prove you can do it legally.
Go read the rest, it’s a rare bit of good news.
H/t Peter Biberstein.
Why the FCC will ignore our comments.
He was right. The Times, with a lot more money and access, is far too frequently wrong (sometimes on purpose). They can’t forgive him for it.
So, it is perhaps nice that the Times stated quite frankly that the long-denied scandal “really happened” – even though this admission is tucked into a movie review placed on page AR-14 of the New York edition. And the Times’ reviewer still can’t quite face up to the fact that his newspaper was part of a gang assault on an honest journalist who actually got the story right.
Thus, the review is peppered with old claims that Webb hyped his material when, in fact, he understated the seriousness of the scandal, as did Barger and I in the 1980s. The extent of Contra cocaine trafficking and the CIA’s awareness – and protection – of the criminal behavior were much greater than any of us knew.
The Times’ review sums up the Webb story (and the movie plot) this way: “‘Kill the Messenger,’ a movie starring Jeremy Renner due Oct. 10, examines how much of the story [Webb] told was true and what happened after he wrote it. ‘Kill the Messenger’ decidedly remains in Mr. Webb’s corner, perhaps because most of the rest of the world was against him while he was alive.
“Rival newspapers blew holes in his story, government officials derided him as a nut case and his own newspaper, after initially basking in the scoop, threw him under a bus. Mr. Webb was open to attack in part because of the lurid presentation of the story and his willingness to draw causality based on very thin sourcing and evidence. He wrote past what he knew, but the movie suggests that he told a truth others were unwilling to. Sometimes, when David takes on Goliath, David is the one who ends up getting defeated. …
“Big news organization like The Los Angeles Times, The New York Times and The Washington Post tore the arms and legs off his work. Despite suggestions that their zeal was driven by professional jealousy, some of the journalists who re-reported the story said they had little choice, given the deep flaws.
“Tim Golden in The New York Times and others wrote that Mr. Webb overestimated his subjects’ ties to the contras as well as the amount of drugs sold and money that actually went to finance the war in Nicaragua.”
The reviewer gives Golden another chance to take a shot at Webb and defend what the Big Papers did. “Webb made some big allegations that he didn’t back up, and then the story just exploded, especially in California,” Golden said in an email. “You can find some fault with the follow-up stories, but mostly what they did was to show what Webb got wrong.”
But Golden continues to be wrong himself. While it may be true that no journalistic story is perfect and that no reporter knows everything about his subject, Webb was if anything too constrained in his chief conclusions, particularly the CIA’s role in shielding the Contra drug traffickers. The reality was much worse, with CIA officials intervening in criminal cases, such as the so-called Frogman Case in San Francisco, that threatened to expose the Contra-related trafficking.
The CIA Inspector General’s report also admitted that the CIA withheld evidence of Contra drug trafficking from federal investigators, Congress and even the CIA’s own analytical division. The I.G. report was clear, too, on the CIA’s motivation.
I gotta say, when even the right-wing Telegraph says it…
Why aren’t the middle classes revolting?
Words you probably never thought you’d read in the Telegraph. Words which, as a Gladstonian Liberal, I never thought I’d write. But seriously, why aren’t we seeing scenes reminiscent of Paris in 1968? Moscow in 1917? Boston in 1773?My current fury is occasioned the Phones4U scandal (and it really is a scandal).
Phones4U was bought by the private equity house, BC Partners, in 2011 for £200m. BC then borrowed £205m and, having saddled the company with vast amounts of debt, paid themselves a dividend of £223m. Crippled by debt, the company has now collapsed into administration.
The people who crippled it have walked away with nearly £20m million, while 5,600 people face losing their jobs. The taxman may also be stiffed on £90m in unpaid VAT and PAYE. It’s like a version of 1987’s Wall Street on steroids, the difference being that Gordon Gecko wins at the end and everyone shrugs and says, “Well, it’s not ideal, but really we need guys like him.”
I’m not financially sophisticated enough to understand the labyrinthine ins and outs of private equity deals. But I don’t think I need to be. Here, my relative ignorance is actually a plus. You took a viable company, ran up ridiculous levels of debt, paid yourselves millions and then walked away, leaving unemployment and unpaid tax bills in your wake. What’s to understand? We should be calling for your heads on a plate.
Continue reading “Why no revolution?”
They make it so hard not to hate them:
My reporting on the Michigan Republican Party’s odious mailer encouraging people to call the phone of the ailing mother of Democratic candidate for Michigan’s 61st House district John Fisher has gotten LOTS of attention. It’s had thousands and thousands of views and the cross-posted version at Daily Kos has given it national exposure. It’s been picked up by other sites, as well, including Raw Story, Wonkette, and others.
Fisher’s opponent, Republican Kalamazoo County Commissioner Brandt Iden, issued a statement that stops very short of repudiating or condemning the mailer, saying, “Obviously, as you know, it was not sent out by our campaign. I don’t condone negative campaign tactics and it’s not something my campaign has done or anticipates doing. I hope Mr. Fisher would do the same.”
Why he would suggest that Mr. Fisher, a pastor, “would do the same” is perplexing. There’s been nothing like this coming from the Michigan Democratic Party or Fisher’s campaign.
I picked up my work laptop yesterday because it was so slow, it was impossible to use with any reasonable speed. My computer repairman told me it was clogged up with viruses. He said Norton sucks, and said the free anti-virus program I use is the one he prefers (AVG). He warned that it was basically impossible to avoid them if you spent much time online — he compared them to potholes. He advised me to be vigilant about updating Java, Flash, and Adobe, because their vulnerabilities were the most popular point of entry for malware and viruses. That’s why I have a backup service — you never know when you’ll need it.
Oh, and by the way, did I mention tomorrow is the beginning of the Mercury retrograde?
Karsten Nohl demonstrated an attack he called BadUSB to a standing-room-only crowd at the Black Hat security conference in Las Vegas, showing that it’s possible to corrupt any USB device with insidious, undetectable malware. Given the severity of that security problem—and the lack of any easy patch—Nohl has held back on releasing the code he used to pull off the attack. But at least two of Nohl’s fellow researchers aren’t waiting any longer.
Caudill and Wilson reverse engineered the firmware of USB microcontrollers sold by the Taiwanese firm Phison, one of the world’s top USB makers. Then they reprogrammed that firmware to perform disturbing attacks: In one case, they showed that the infected USB can impersonate a keyboard to type any keystrokes the attacker chooses on the victim’s machine. Because it affects the firmware of the USB’s microcontroller, that attack program would be stored in the rewritable code that controls the USB’s basic functions, not in its flash memory—even deleting the entire contents of its storage wouldn’t catch the malware.
But he (Karsten Nohl) warned that even if that code-signing measure were put in place today, it could take 10 years or more to iron out the USB standard’s bugs and pull existing vulnerable devices out of circulation. “It’s unfixable for the most part,” Nohl said at the time. “But before even starting this arms race, USB sticks have to attempt security.”
Wendell Pierce is one of my favorite actors and I can’t believe this cop didn’t recognize him. But I’m sorry that this happens to anyone:
Wendell Pierce: And the fact is… The fact is while we have this very comfortable, colloquial debate about it, when the lights go out and I go out in the street and I get behind the wheel of my car, the most dangerous moment I ever have in my life is when a police officer pulls me over. Every black man in America knows that when that happens, there’s actually a possibility his life may come to an end and that shouldn’t happen. It actually happened to me in Louisiana, dressed as I am, going to my uncle’s funeral, two toddlers in the back. I had just picked up my cousin from Chicago. A 100 degrees on the road in Louisiana, I’m pulled over and I sat there waiting for the cop to come. I have a habit of always taking my wallet out and putting it on the dash to make sure he doesn’t think this is going for a gun. I sat there and sat there and sat there and I realized he hadn’t come. Air conditioner on, 100 degrees and I look in the mirror and I see… That’s all I heard.
As I turned down the window you hear, “Motherfucker get out that car, I’m gonna blow your fucking head off.” Now he didn’t have the training to say, “I’m going to come up to the car.” I have to tell these toddlers, “Be cool. Everything’s fine. Uncle Wendell’s going to get out of the car. Everyone don’t move.” I put my hands up, get out the car, opened the door from outside. But I told the officer, “Why didn’t you use your P. A.? Simple, get in your car…” “Well why didn’t you get out of your car?” I said “I had the window’s up, it’s 100 degrees, and I had the air conditioner on. I can’t hear you.” That’s poor training, that he didn’t know that I wasn’t going to be able to hear him in the car. He’s going to fire. So it’s that sort of incident that happens too often all the time, that white America has to understand that Wendell Allen in New Orleans, Mr. Garner in Staten Island, Michael Brown in Ohio, is a constant all over this country. And if we’re going to sit here and pretend that we are post-racial, you have to realize that I can’t afford for your belief or denial that my life isn’t in danger.
Via Ed Tayter.
Remember, prosecutors have some degree of discretion about what they chose to prosecute. This is a perfect example:
A Minnesota prosecutor will proceed with a child endangerment case against a mother who provided medical marijuana to her son to treat symptoms of a traumatic brain injury — despite the fact that Minnesota recently passed a law allowing cannabis oil to be used for medical purposes — ThinkProgress reports. That law, however, will not go into effect until 2015.
Angela Brown’s son, Trey, suffered the injury at a baseball game three years ago.
“It just hurts in my brain everywhere,” Trey said. “I really can’t explain the pain.”
Along with the pain, he suffers from uncontrollable muscle spasms and seizures so severe that he had to stop attending school and caused him to be suicidal.
“I was afraid to go to the bathroom,” his mother Angela Brown said, because “he’d be harming himself.”
Last winter, she took Trey to Colorado, where they found a doctor who prescribed a particular strain of cannabis oil to treat him. “Within an hour of him taking it, we could tell a difference,” Angela Brown said.
When he returned to school, teachers and administrators wondered about his seemingly miraculous recovery. When Trey informed them, however, they were less than pleased.
“It was a week later when my mom called and said, ‘The cops are looking for you,’” Angela Brown said. Police seized the oil and charged her with child endangerment and causing a child to need protection.
His father, David Brown, said that Trey’s symptoms have returned since he stopped using the oil.
Thanks, David Benowitz.
If only those damned Palestinians hadn’t resisted when Israelis tried to take their land, we wouldn’t have to keep killing them!
Alex Pareene on Richard Cohen, 2013:
“I am a deeply ignorant and cloistered old man,” should be the next sentence, “and no one should pay me for my views and opinions, because they are worthless.”…
This Richard Cohen column — and perhaps all Richard Cohen columns — should be read as a memo to Jeff Bezos, the new owner of the Post. Cohen is saying, perhaps subconsciously, that he has nothing to offer the Washington Post. He adds no value. “Buy me out,” Richard Cohen begs, between the lines. “Pay me to go away and stop embarrassing this once respected newspaper.” How much will it take? I am not sure, but Jeff Bezos is a very rich man, and I think he can afford it. Indeed, if his mission is to invest in quality journalism, paying Richard Cohen to go away would be one of the quickest and simplest ways to advance that mission.
