Cash for Refridgerators?

Coming on the heels of the "Cash for Clunkers" program---which saw the Federal Government induce car dealers to give away billions of dollars to induce people to buy this year cars that they were going to buy next year---reports are surfacing that the next installment is already on the drawing boards.

Not content with giving away money to car buyers, Congress appears on the verge of giving away tax dollars to those who may be in the market for new household appliances. And now that the Bailout Bandwagon is fully engaged, there appears to be no end in sight.

Assuming a similar reaction to the "Cash for Refridgerators" program---whereby thousands of consumers rush to take advantage of all this "free money," at least one taxpayer wonders where it will all end. If "Cash for Clunkers" leads inevitably to "Cash for Refridgerators," can "Cash for Trash" be far behind?

Though my wife insists that I'm just looking for an excuse for forgetting to put out the trash cans on Wednesday nights, I'm already starting to stock up. Before long, we should have enough stored up to be able to afford a very nice mansion somewhere on the coast.

The only glitch may be if house prices recover. But from where I'm sitting, the odds of that happening any time soon are pretty remote...and certainly no better than the likelihood that sanity, or fiscal responsibility, will return to Capitol Hill in the near future.

JEFFREY CAMINSKY, a veteran public prosecutor in Detroit, Michigan, specializes in the appellate practice of criminal law and writes on a wide range of topics. His books include the science fiction adventure novel The Star Dancers, the exciting second volume in the Guardians of Peace-tm series, The Sonnets of William Shakespeare, and the acclaimed Referee’s Survival Guide, a book on soccer officiating. All are published by New Alexandria Press, and are available on Amazon, as well as directly from the publisher.

Used Car Salesman in Chief

Perhaps it's just me, but I'm getting sick and tired of being pushed into hasty decisions.

Over the past several months it seems that there has been a race to pass legislation through Congress without much thought. Last year, the TARP bailout was raced through in weeks---ostensibly because waiting to give us a chance to think about what we were doing would mean than any action in ridding the country of the "toxic assets" that the TARP funds were to buy up would come too late to stave off the disasters that were looming in the shadows.

Of course, once the bill passed, the Bush Administration got a few better ideas...and we still haven't spent all the money appropriated. Well...not to buy any toxic assets, at least. We still haven't gotten around to that...though that $700 billion dollars sure came in handy for Congress and the new Obama Administration, since they now had a ready source of funds to hand out as they saw fit.

As the new adminstration was about to take office, there was another push---this time for another $787 billion or so---which was passed less than a month after President Obama took office, before anyone in Congress had the chance to read it. Recently, the "Cap and Trade" bill passed the House---with 350 pages or so of amendments added in the wee hours of the morning after Michael Jackson died. That, too, had to pass immediately, before anyone could read it---this time, one presumes, so that the members of the House could attend to more important matters. Like watching the wall-to-wall, 24/7 coverage of the death of Michael Jackson.

Now, amid talk of a few more trillion dollars or so in various bailouts---to prepare the way for the Health Care Reform package that the President insists is needed to save us from imminent bankruptcy---there is a push by Congressional leaders and the Administration to enact the plan...NOW, before it's too late. Today, in the wake of a Congressional Budget Office report confirming what most people instinctively thought---that current health care proposals will cost an awful lot of money---there seems to be a renewed push to get this done in a hurry. The President insists that waiting will result in a catastrophe for this country and future generations...and only quick, bold action can save us.

It strikes me that we've been down this path before. Quite a few times in recent months.

And it's starting to sound more and more like the typical pitch from the local used car salesman---that we need to decide now, because if we stop to think about what we're doing, we'll miss this golden, once-in-a-lifetime chance, and spend the rest of our lives regretting it.

Again...perhaps it's just me. But despite the glowing rhetoric, and the loft notions advanced by the current crop of politicians, it's starting to sound more and more like the high-pressure tactics of the used car lot.

These tactics didn't save the auto industry from disaster.

I doubt that they'll lead the rest of the country to anything but grief, either.


JEFFREY CAMINSKY, a veteran public prosecutor in Detroit, Michigan, specializes in the appellate practice of criminal law and writes on a wide range of topics. His books include the science fiction adventure novel The Star Dancers, the exciting second volume in the Guardians of Peace-tm series, The Sonnets of William Shakespeare, and the acclaimed Referee’s Survival Guide, a book on soccer officiating. All are published by New Alexandria Press, and are available on Amazon, as well as directly from the publisher.

Rule of Law at Risk in Chrysler Bailout

It's easy to lose our heads in these perilous economic times. This is especially true since the car companies occupy such a large place in local affairs. Chrysler's bankruptcy is looming large in the public's eye, and here "money interests" are being pounded relentlessly for their supposed greed and intransigence. The Obama Adminstration is pushing a plan that would turn over a large chunk of the Company to the UAW, largely at the expense of secured creditors---including pension plans---who loaned Chrysler money. In the event of a bankruptcy, the Law says that they should be repaid first---with others standing in line, to see if there is anything left over. Lost amid all the clamor surrounding the auto companies and their woes, is the fact that there is a more honorable alternative to stiffing secured creditors in favor of political cronies.

The constitution requires payment of just compensation whenever private property is taken for a public purpose. If the Obama Administration is pushing secured creditors (such as the pension plan bond holders) aside for unsecured stakeholders (like the UAW), the alternative to setting aside the rule of law seems clear: use public money to pay off the secured debt (or, at least as much of the secured debt as they'd get if the Company were liquidated). This would have the effect of actually following the law, while at the same time making clear that it is the Government---and not the private parties involved---who is calling the shots.

JEFFREY CAMINSKY, a veteran public prosecutor in Detroit, Michigan, specializes in the appellate practice of criminal law and writes on a wide range of topics. His books include the science fiction adventure novel The Star Dancers, the exciting second volume in the Guardians of Peace-tm series, The Sonnets of William Shakespeare, and the acclaimed Referee’s Survival Guide, a book on soccer officiating. All are published by New Alexandria Press, and are available on Amazon, as well as directly from the publisher.

A Modest Amendment

Looking out over the morass that is currently the US economy, it is clear that changes are needed. Everywhere we look, greed and stupidity seem to reign supreme, and from the sounds of the squawks coming down from Capitol Hill, nothing seems likely to change. Blithely ignoring its own complicity in creating the mess, Congress is preening like an oversized, waddling turkey, with every member rushing to denounce the outrage du jour arising as a result of their various hastily-conceived, hastily-crafted, and never-quite-read-or-even-looked-at-too-closely bailout packages.

If produced and choreographed professionally, the result would be a hilarious, if wildly improbable farce, filled with pratfalls by the pompous and well-earned comeuppances abounding. Unfortunately, the price tag for this production is proving well beyond the means of its target audience. While it might be amusing at matinee prices, having the country pay the $1 trillion price of admission has removed most of the show’s humor, and left the troupe’s backers—the increasingly angry taxpayers of this country—up in arms.

The play’s traditional next act—sharpened pitchforks, hot tar, and plenty of feathers—strikes at least one observer as entirely too predictable. While venting outrage on the chorus line of fools and incompetents who led us into this mess may satisfy us for the moment, there is no guarantee that a new cast of characters would do any better. Replacing our current set of fools with another would, it is true, carry the advantage of sending the whole sorry lot packing. But just replacing them with an entirely new set of fools will hardly solve our problems. It might provide a few more sordid plot lines to the melodrama that American Politics seems to be trending toward, but it will do little to fix our present train wreck of an economy—or keep us safe in a world filled with people who hate us.

On the other hand, the simplest solutions often work best, merely because there is so little that can go wrong with them. So perhaps it’s time we tried applying to Congress a lesson in reality familiar to every small business owner or working parent. In short, giving to Congress a slice of life from the “little people” who appear to factor into none of their equations.

Congress and the President often pay lip service to the role of small business in this country. But they do not understand what real responsibility is like at the level where people work and earn a living. Unlike the Federal government, the millions of Mom & Pop operations in this country can’t live on non-existent earnings, year after year. They have to make their payroll. And pay their bills. And pay their taxes. And if there’s nothing left over for them to take home after all their expenses are met, they can’t simply print money to pay themselves.

Our elected leaders, on the other hand, have billions of dollars in other people’s money to play with. And can always get more—either by raising taxes, or by printing it. Predictably, this has led them to be a mite careless in their stewardship.

The solution, it seems to at least one petulant observer, would be to give them an “ownership stake” in the bottom line: simply put—they should be paid out of the money left over after paying all the bills. If there’s none left—if, for example, the country is running a deficit—then they’ll get an IOU for their salary. Just like all the naive taxpayers in California, who thought a tax refund entitled them to actual money. Or, better yet, in addition to the country’s thanks for doing such a wonderful job, they’ll just get a dollar. After all, if it’s good enough for the CEOs of the various and sundry failed companies we’re bailing out by the billions of dollars, it should be good enough for Congress—whose spending habits We The People have been bailing out for years. In fact, we could probably even raise their official salary: by the looks of things, it wouldn’t cost us anything. And who knows—we might even attract a few people to public office who knew what they were doing. Or some naive souls who still think of public service as a sacrifice made for the Public Good, rather than a means of helping friends and colleagues help themselves to other people’s money.

Of course, there may be a few bugs to work out. We wouldn’t, after all, want to let Congress guarantee their salary simply by jacking up tax rates too high. (That risk would be nearly as obvious as the risk of giving billions of our dollars without strings to people whose chief claim on the money is their ability to squander billions of their own dollars). So we might want to add a provision to restrict the Government’s share of our money to a reasonable amount—enough to do everything it needs to do, but not enough to get into too much trouble. Twenty percent of our Gross Domestic Product should do it (though the amount isn’t cast in stone; the modesty of this proposal does not, after all, include an immodest claim of infallibility). After all, that’s twice the amount they’d get if everyone simply “tithed” their income. And we could always include a provision letting Congress go above their new constitutional “Cap” by declaring a state of National Emergency—during which, of course, all elected Federal officials would gladly defer all but a nominal dollar of their salary until the crisis they led us into is passed.

Assuming that most state legislators would be more willing to impose some sort of control on Congress than they would be to face the pitchforks of their disgruntled constituents, getting three-quarters of the states to approve the amendment should pose few problems. This means that all we’d really need would be a two-thirds vote of each House—which, given their adamance that those in charge of failed companies should be willing to serve for a dollar a year, would only be a problem if hypocrisy dared to show itself publicly in the halls of Congress.

Proposed Amendment to the Constitution of the United States

(1) The salaries of the President, Vice-President, and all members of Congress shall be payable on the first day of January of each year, for the ensuing year. Such officers may elect to defer their salaries over the course of the ensuing year; the salary of newly elected officers will become payable upon taking office.

(2) Except for any officer mentioned in Section (1) who was newly elected to a first term of office during the preceding year, and notwithstanding any other provision of law establishing their salaries or other remunerations, neither the President, Vice-President, nor any member of Congress shall be entitled to draw more than one dollar ($1) in salary, in any year in which the budget of the United States runs, or is projected to run, a deficit. For purposes of this Section, all federal expenses, including trust funds and any and all special appropriations, shall be included in the calculation of a deficit. The refund of any salary paid to an affected officer during a year in which the budget is in deficit shall be payable by the officer to the Treasury of the United States on April 15th of the following year. Failure to make a timely payment of excess salary shall be grounds for removal from office.

(3) Except during times declared by Congress to be a National Emergency, the tax revenues of the United States shall be limited to twenty percent (20%) of the Gross Domestic Product, as calculated by the Department of the Treasury. Excess taxes collected shall be proportionately refunded by April 15th of the following year, unless Congress has established a proportional system of tax credits to accomplish the same purpose.

(4) During a time of National Emergency declared by Congress, the President, Vice-President, and all Members of Congress shall draw a salary of one dollar ($1) per year, until such time as Congress declares that the emergency is over.


JEFFREY CAMINSKY, a veteran public prosecutor in Detroit, Michigan, specializes in the appellate practice of criminal law and writes on a wide range of topics. His books include the science fiction adventure novel The Star Dancers, the exciting second volume in the Guardians of Peace-tm series, The Sonnets of William Shakespeare, and the acclaimed Referee’s Survival Guide, a book on soccer officiating. All are published by New Alexandria Press, and are available on Amazon, as well as directly from the publisher.

No Shortage of Blame for the Bail-Out Mess

With fingers pointing in all directions, the nation's press and politicians are scrambling to assess blame for the lastest in an unending chain of blunders relating to the country's financial mess. Typical is a recent article in the Washington Post, in which the White House is determined to throw Treasury Secretary Timothy Geithner under the bus.

This action comes as the Obama Administration seeks to avoid taking the blame for the failure of Congress to anticipate the level of irresponsibility that bailed-out financial giants like AIG would show, by using bailout funds to provide performance and retention bonuses to the executives and other geniuses who caused the mess in the first place.

In point of fact, it appears that the bonuses were specifically exempted from Federal limitations through an amendment crafted and sponsored by Sen. Chris Dodd of Connecticut...who was among the vocal critics of the practice until he was reminded that it was the "Dodd Amendment" which allowed the bonuses. And, of course, the amount of money spent---roughly $150 million...or about 0.1% of the amount Congress approved for the hastily-crafted, unread, and essentially undebated bailout package---was too small for them to bother with. Chump change...or so it seemed to them at the time.

Of course, that was before everything hit the fan. Now, our elected leaders are trying to outdo each other in their expressions of outraged incredulity. Simply put, now that they are feeling the heat of an outraged country, Congress is pretending to be shocked---shocked!!---that companies would actually do what Congress permitted them to do. And to prove their outrage, there is talk afoot to impose a confiscatory tax to recoup any bonuses that the executives---some of whom no longer work for the firm that was giving them a "retention" bonus, and many of whom, being foreign nationals, are beyond the range of Congressional sputtering---are too unpatriotic to return.

Of course, changing the law after the fact is unconstitutional: the "Ex Post Facto" clause prohibits Congress from taking action to punish people after the fact. And the "Bill of Attainder" Clause forbids them from passing laws directed against specific people who have roused their ire.

Not that such legal limits will constrain anyone---the Constitution seems to be resemble a giant imaginary sieve these days, and is hardly a thing that politicians bother with when their own self-interest is on the line. But unless people wake up, all the fuss and feathers may very well succeed in distracting enough people to serve politicians' main aim: to divert attention away from themselves---all of whom share a significant share of the blame for our current troubles---and onto the shoulders of a convenient scapegoat du jour.

Of course, some of us keep hoping that the country will wake up and start paying attention to the fools and scoundrels we have in charge of things these days. But then again, some of us are just hopeless idealists...still struggling to hold on to a dream of what this country could be if its people were only wise enough to choose their leaders with the same care they use to pick their breakfast cereal.

JEFFREY CAMINSKY, a veteran public prosecutor in Detroit, Michigan, specializes in the appellate practice of criminal law and writes on a wide range of topics. His books include the science fiction adventure novel The Star Dancers, the exciting second volume in the Guardians of Peace-tm series, The Sonnets of William Shakespeare, and the acclaimed Referee’s Survival Guide, a book on soccer officiating. All are published by New Alexandria Press, and are available on Amazon, as well as directly from the publisher.

The Next Crisis for the Auto Industry?

Congress is now moving toward a proposed solution to the auto industry's woes, though the outcome is far from certain. The House has passed its version of a bailout, while a Republican-led filibuster looms as a possibility in the Senate. I hate to think of what the collapse of the auto industry would mean, not just in Michigan, but across the country. At the same time, we could easily just make things worse, unless we are---in the immortal words of Elmer Fudd---"vewy, vewy ceahful..."

From my perspective, the problem isn't the fact of government backing, it's all the baggage that this kind of "backing" will carry along with it. We've already seen how helpful the government has been to our financial institutions, with the "backing" they gave to Fannie Mae and Freddie Mac; I suspect that they would offer similar kinds of help to the domestic car industry.

It's said that an elephant is a mouse, designed to government specfications. I shudder to think what a car designed to please Congress, or a Czar answerable to Congress, would look like.

If I recall correctly, the peasants killed the last Czar...or, at least, stood by cheering while thugs promising them paradise did the actual dirty work. I'm not sure things will wind up much differently, in or out of bankruptcy, if we let Congress appoint the next one.

Meanwhile, while Congress dithers, other precincts are starting to report:

A Michigan Perpsective on Senator Shelby


JEFFREY CAMINSKY, a veteran public prosecutor in Detroit, Michigan, specializes in the appellate practice of criminal law and writes on a wide range of topics. His books include the science fiction adventure novel The Star Dancers, the exciting second volume in the Guardians of Peace-tm series, The Sonnets of William Shakespeare, and the acclaimed Referee’s Survival Guide, a book on soccer officiating. All are published by New Alexandria Press, and are available on Amazon, as well as directly from the publisher.

Should We Bail Out the Auto Industry?

I suspect that many people don't really appreciate the dire straits that an implosion in the auto industry would cause...at least, judging from the debate going on in Washington. But I think the biggest problem is that everyone is confused over (a) the scale of the problem, and (b) the constant juggling that's going on with federal money. I think the biggest worry is that funneling money to the car companies will only be sending good money after bad, unless there are major changes in the way GM & others do business, and right now the focus of the debate is (a) the size of the bailout, and (b) comparisons to all the OTHER bailouts afoot. Lost in the discussion seems to be how to restructure the care companies...and the magnitude of the fallout, if GM goes down. Perhaps we're a bit biased, being from Michigan (which would be at ground zero), but I don't get the sense the decision-makers realize just how many other industries and businesses would be affected.

I suspect that if the focus of the debate starts turning to a discussion of facilitating changes in the way the car companies do business in the future, rather than an argument about how much money they want, things might start moving in a more productive direction.

In addition...I suspect that the auto exec's and union officials should either (a) take a course in public relations, or (b) learn to keep their mouths shut. I don't think the people they're asking to rescue them need to hear much besides, "Of course, our management salaries will be slashed to the bone...and any bonuses are out of the question for the foreseeable future," and "Of course, the Union stands ready to do whatever it takes to make the industry competitive again." It sounds like they should all go back and read everything they can find about Iacocca's adventures 30 years ago as head of Chrysler during its darkest days: as I recall, the success of the venture depened upon (a) his personal willingness (well...the perception of his willingness) to share the privations that were coming; (b) his ability to convince others that the rough times ahead would lead to something better, if everyone pitched in and helped; and (c) a certain ruthlessness in execution. I don't see similar leadership today...in ANY of the industries with their hands out.

Speaking of the subject of Chrysler...I remember one W. Martin Makinen saying, about that time, that the biggest danger from the original Chrysler bailout might not be that it would fail, but that it would succeed. I sometimes wonder what would have happened if we'd let Chysler go belly up...and whether that would have just led to a deeper recession back in the late 70's, or whether it would have awakened Ford and GM (and the rest of Corporate America, as well), to the very real prospect of their own corporate mortality, if they didn't learn the lesson of the first oil shocks, and adjust.


JEFFREY CAMINSKY, a veteran public prosecutor in Detroit, Michigan, specializes in the appellate practice of criminal law and writes on a wide range of topics. His books include the science fiction adventure novel The Star Dancers, the exciting second volume in the Guardians of Peace-tm series, The Sonnets of William Shakespeare, and the acclaimed Referee’s Survival Guide, a book on soccer officiating. All are published by New Alexandria Press, and are available on Amazon, as well as directly from the publisher.