Wow. Just Wow. Updated.

Apparently, we’re in for another financial “crisis” and the Wall Street Journal wants to be sure in advance that the spin is spun.

President Bush and Tim Geithner and Hank Paulson were the great heroes of the last crisis, you see.  They resisted the detestable Trumpian “populism” of the day to reward their friends with a $12 trillion dollar bailout to “save the whole economy” which was “on the line” in 2008.

Here’s the truth.  The “economy” they were saving is not really an economy as that term is usually and properly understood.  They “saved” the corporatist-socialist political system over which they perched then, and continue to perch today.  We say “saved” because it was a very expensive kick the can down the road maneuver that we must admit has exceeded all rational expectations for effectiveness in delaying things, but of course fundamentally changed nothing.  Which of course to overlords is the point:  the “system” as it is has been good to them.  Why change it?

So as we careen towards the next “crisis” which of course is actually a continuation of the previous one that was never actually solved, we have another thought about things economic.  We made a suggestion some time ago about a jubilee 28th amendment that would cancel existing debt and establish a gold standard.  Talk about a fundamental change.  We still like the idea a lot, but it appears we are the only ones.

Here’s another suggestion for a 28th amendment that is almost as good in theory but way simpler.  And to be frank it would probably be about as popular, but that’s a separate problem:

Neither the United States nor any state shall henceforth impose any tax upon, or otherwise permit the encumbrance of, residential real estate.

See, populism does indeed get out of hand (think French Revolution) but that doesn’t mean it should always be ignored.  It can function as a bellwether.

Anyway, comments on this proposal for a constitutional amendment will be appreciated.

Update:  They always report it, at least somewhere, so it can never be said that your weren’t informed.

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Tolerance For Ambiguity

Again, SHG is not technically wrong in this comment:

You sound as if you’ve been overloaded to the point of head explosion. Tough nuggies. This is reality, and it’s messy. Tolerance for ambiguity is one of the foremost qualities needed to practice criminal law. Not everyone has it.

It would be almost axiomatic:  by nature, the criminal defense position would have to be more sensitive to nuances and ambiguities.  The prosecution narrative is always blunt:  the defendant is a no-good criminal scumbag.  The defense doesn’t assume the burden of the reverse narrative – that the defendant is a great civic hero.

But once again there’s more than a little irony going on.  A tolerance for ambiguity should not become perverted into commitment to ambiguity, a slavish devotion to ambiguity as an overarching principle of action and a framework for understanding anything, no matter what the evidence is.  Dare we say it, that winds up being – well – an unambiguous fealty to the principle of ambiguity.  It’s oxymoronic.

SHG has been explaining himself well the last few days.  We’re grateful, albeit somewhat frustrated and maybe a bit saddened: he stubbornly clings to a failed and rapidly receding professional self concept that has ill-served him, his clients, the profession and the justice system itself.  He’s unreflective about that, and about the possibility that his dominance of a tiny corner of the internet, a part of the “blawgosphere” – has stagnated, aged and withered just as he and his self-concept have.  One’s a metaphor for the other, maybe.

He has exhausted his shtick, methinks.  The gritty, gutsy trench lawyer, the lazy and self-entitled youth that aren’t sufficiently in the SHG mold, and maybe a dozen or so other tired themes have run their course.  It isn’t a weariness that has come out of nowhere, of its own accord.  SHG brings it with him, in more ways than one.

GREXIT*

It’s easier said than done. Here’s the nub of the problem:

Greek banks, which have been closed all week and rationing withdrawals from cash machines, are expected to run out of money within days unless the European Central Bank provides an emergency lifeline. Finance Minister Yanis Varoufakis is due to meet top Greek bankers later on Sunday and State Minister Nikos Pappas, one of Prime Minister Alexis Tsipras’s closest aides, said it was “absolutely necessary” to restore liquidity to the banking system now that the vote is over.

However the European Central Bank, which holds a conference call on Monday morning, may be reluctant to increase emergency lending to Greek banks after voters rejected the spending cuts and economic reforms which creditors consider essential to make Greek public finances viable, central bankers said.

If Tsipras wants to win this game of chicken he’d better be prepared to fully exit the Euro, for the simple reason that as long as Greeks need Euros to conduct business and transactions of all kinds, the European Central Bank can run his little rebellion into the ground.

This article sheds a little light on the difficulty:

Countries switching currencies must grapple with two major questions: how to introduce new notes and coins, and what to do with bank accounts, debts, and financial instruments denominated in the old currency.

Of course, Bloomberg is an arm of the cognoscenti and is hardly rooting for a successful Grexit, but that doesn’t mean they’re wrong about everything.

One possible solution is to realize just how much the sovereign power can do in this situation as long as it follows natural law.  Assuming the Greek government has some quantity of gold or silver**, it could certainly re-institute a gold or silver based drachma at whatever exchange rate made sense given their ability to redeem their notes.

To give you an idea of how this might go, remember that on these pages we suggested that if the US returned to a gold standard the dollar price of an ounce of gold would have to be pegged somewhere north of $30,000 – at least at first.  And there’s no real reason to be afraid of that: people need to conduct business, buy and sell food clothing and shelter a lot more than they need to get their hands on gold or silver.

The problem – well, one problem anyway – is I suspect that neither Tsipras nor anyone else in a position of authority in the Greek government has a clue about any of this.  Which means if the German dominated ECB wants to turn the screws they can and the Greek people will suffer.

In any case, it’s a fascinating development.

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*   For those of you who are inexplicably puzzled by this title:

https://en.wikipedia.org/wiki/Greek_withdrawal_from_the_eurozone

 

**   Of course, when Cyprus went down this road a little ways about 2 years ago, the “troika” confiscated all their precious metals, probably for the very reason that it could provide a viable way out.

Magna Carta At 800 And Due Process In America

(Author’s note: if you click the links and read the cases you’ll probably get a real legal education, of sorts anyway. We realize it’s a lot of reading, but hold out the hope that it will greatly enhance the reader’s understanding of what is posted here.)

On June 15, 1215 King John capitulated to his Barons and signed the Magna Carta in a place called Runnymede.

Just about 800 years ago exactly.

Runnymede is in England, a country with which we supposedly share the common law tradition, but that’s a large subject for another time.  So, too, are the various political intrigues surrounding Magna Carta and what it eventually came to mean in the fullest sense.  We’re not going to run with any of that today either.  Because whatever else Magna Carta stands for, there are some small number of principles that it is more or less not debatable that Magna Carta enshrined.  One of these is the jury trial.  Another is “due process of law”, which was originally expressed as “law of the land”.

We’re going to focus on the due process of law idea, and what has happened to it in the United States of America over the last, say, 50 years.  Because we know a lot about that.

There’s so much to say, but let’s begin by noting that the phrase “due process of law” appears in the 5th amendment to the United States Constitution (and probably in many if not all state constitutions but we’re going to focus on the US constitution right now) and in that 5th amendment form it provided that no person should be deprived of life, liberty or property without due process of law.

So a couple of preliminary observations:  1) the “due process” clause is a limitation on government conduct.  Obviously, a thief deprives you of your property without due process of law but the due process clause does not apply to that situation because the thief is not acting on behalf of the government; and 2) due process is required only in three situations, namely, where the government is going to deprive you of life, liberty or property.

One other preliminary observation:  due process doesn’t apply in war situations.  Just to be clear about things.  The general acts on behalf of the government, but he doesn’t have to worry about due process of law before ordering an air strike.  Which is not to approve of this or that air strike.  We generally don’t, if that matters.

Anyway.  Moving on.

All those preliminary observations aside, it can be fairly said that the most fundamental situation in which due process does apply is when the government prosecutes someone for a crime, in which case at least one but in many cases all three – life, liberty and property – are at stake.

Now, it is a truism that the due process requirement of the 5th amendment applied only to the federal government.  Which is not to say that the states were ever free to ignore the strictures, whatever they may be, of due process of law:  again, the states almost assuredly had due process ideas in their own constitutions.  But the state governments and the federal government are separate, or at least they were.  Or at least, in some ways.

But in the wake of the Civil War, the states became subject to a federal standard of observing due process of law by virtue of the passage of the 14th amendment, which provided that “No state shall deprive any person of life, liberty or property without due process of law.”  That occurred in about 1866.

What happened then?  For a long time, not much.*

In the 1880’s the Supreme Court considered the question of whether federal standards of due process of law (now applied to the states by the due process clause of the 14th amendment) required the states to prosecute felonies only upon an indictment by a grand jury, which was separately required of the federal government by that same 5th amendment.  The answer was no.  And to this day California does not have to prosecute felonies via grand jury indictment.

That didn’t go so well, then, if you’re a fan of grand juries.

Very little was said for about another 30 years.  But then in 1915 the Supremes are deciding a federal habeas corpus case and they say that this federal due process standard is a big deal with real teeth:

In the light, then, of these established rules and principles: that the due process of law guaranteed by the Fourteenth Amendment has regard to substance of right, and not to matters of form or procedure; that it is open to the courts of the United States upon an application for a writ of habeas corpus to look beyond forms and inquire into the very substance of the matter, to the extent of deciding whether the prisoner has been deprived of his liberty without due process of law, and for this purpose to inquire into jurisdictional facts, whether they appear upon the record or not; that an investigation into the case of a prisoner held in custody by a State on conviction of a criminal offense must take into consideration the entire course of proceedings in the courts of the State, and not merely a single step in those proceedings…

So at this point things are getting active, as Rollie Massimino used to say.  It was only eight more years until the next major Supreme Court foray into the question of federal due process applied to state criminal proceedings.

Thus in 1923 the Supreme Court decided that a state court trial that had degenerated into a “mob dominated” circus did not satisfy the federal standard for due process of law. Also that year, the SCOTUS opined in Meyer v. Nebraska regarding “due process”:

“While this Court has not attempted to define with exactness the liberty thus guaranteed, the term has received much consideration and some of the included things have been definitely stated. Without doubt, it denotes not merely freedom from bodily restraint but also the right of the individual to contract, to engage in any of the common occupations of life, to acquire useful knowledge, to marry, establish a home and bring up children, to worship God according to the dictates of his own conscience, and generally to enjoy those privileges long recognized at common law as essential to the orderly pursuit of happiness by free men.”

Then in the 1930’s all hell broke loose.

It isn’t really well known today, even in legal circles, but the first time the Supreme Court really threw down the gauntlet on federal due process standards applied to state criminal prosecutions – because the 14th amendment – was the Scottsboro boys case out of Alabama that began in 1931. A group of black youths convicted of raping two white girls. Very emotional case in Alabama at that time.

Of course, the “due process” the kids received was a sham, a circus. The case went up to the SCOTUS in 1932 and that’s what they said and then they said 14th amendment and sent it back to be done right.

And of course it wasn’t. So the case went back up to the SCOTUS again in 1935 (!) only this time the decision rendered had more to do with the racial make-up of the jury, not due process of law proper. But the significant thing here is that having already laid down the law – the law of due process, that is – that must be observed by state courts in carrying out criminal proceedings, the SCOTUS, which is not a court of error, actually took up the same case again.

Don’t happen much.

It was at this same time – 1935 – that the SCOTUS further laid down the law in Mooney v. Holohan to the effect, basically, that the government couldn’t lie and cheat to get a criminal conviction, that doing so violated a person’s right to due process of law. It was a little embarrassing – at least the SCOTUS thought so – that this needed to be said:

Reasoning from the premise that the petitioner has failed to show a denial of due process in the circumstances set forth in his petition, the Attorney General urges that the State was not required to afford any corrective judicial process to remedy the alleged wrong. The argument falls with the premise.

Even so, it should be borne in mind that the California Attorney General argued that position, just as the Alabama Attorney General had argued in favor of the Scottsboro boys convictions.  A state Attorney General is a high official, and it’s just our opinion but we think the Attorney General should be a lawyer’s lawyer and a servant of the law, not a “zealous advocate”.

(As an aside, both Mooney and the Scottsboro boys cases involved communists advancing the due process arguments that eventually prevailed.  We generally don’t like communists around here, but when they’re right we admit they’re right.)

But let’s move on some more. This was the due process revolution in the SCOTUS; these were the cases in which the rudimentary demands of justice, which is what due process has fundamentally meant since the beginning – since Magna Carta – were held to be mandatory and binding on government – all government – throughout the United States. We point this out because the “legal community” often touts the Warren Court decisions of the 1960’s as “the due process revolution”. As often happens, the legal community is pretty much wrong and misses the big picture. To the detriment of us all, I might add.

No, it was in the 1940’s and 50’s that federal due process standards really began to take hold. In 1940 even the constitutional literalist and purist Hugo Black had this to say in deciding Chambers v. Florida:

The scope and operation of the Fourteenth Amendment have been fruitful sources of controversy in our constitutional history. However, in view of its historical setting and the wrongs which called it into being, the due process provision of the Fourteenth Amendment — just as that in the Fifth — has led few to doubt that it was intended to guarantee procedural standards adequate and appropriate, then and thereafter, to protect, at all times, people charged with or suspected of crime by those holding positions of power and authority.

Then in 1942 the SCOTUS said in a couple of cases that the state could not obtain a conviction dishonestly – by taking contradictory positions in different prosecutions – and also that a state couldn’t obtain a conviction by threatening a criminal defendant with the use of perjury to badger and terrorize him into pleading guilty.

It might not seem like a lot, but this was a veritable 14th amendment due process of law blizzard coming out of the SCOTUS compared with, say, the period from 1866 to 1915.

In other words, this really was a due process “revolution”. But these cases reflected more than just a mechanical application of a clause in a constitutional amendment; they were really a re-assertion of the fundamental idea of due process as enshrined in Magna Carta all those centuries ago: the government cannot oppress; the government must be honest.

Unhappily, we must report that it is just this – the very foundations of our ideas of fair and just government – that have crumbled in the years since. We have our ideas about why, but that’s way too much for a blog post.  What we can do is continue to chronicle the failure.

In 1952 the SCOTUS – perhaps mindful of the oppressive government tactics employed by totalitarian governments in the great war just past – said that pumping a man’s stomach without his consent to get evidence that he possessed illegal narcotics was a due process violation. In 1959 they said – again – that the state government couldn’t lie and cheat to get a criminal conviction. And in 1967 they said it again, only this time it was not conceded by the state that they had thus obtained the conviction, but for the first time the SCOTUS indicated that the truth could not be mocked.

But by 2003, well, merely pumping someone’s stomach without their consent seemed like due process child’s play and there was disagreement on the SCOTUS over a situation far more like torture.

And by 2009, the United States Justice Department and the nation’s prosecutors as a whole were arguing in the SCOTUS – with a straight face, no less – that lying and cheating to obtain a criminal conviction didn’t violate the right to due process of law. As if Mooney, Pyle, Napue and Miller had been repealed, or somehow rendered meaningless.

Yet those cases are among the most notable pure descendants of Magna Carta in American law, based only on principles of justice so fundamental that they barely needed to be said in 1215, much less 1935. Much less today, yet here we are.

Maybe every generation, or every second or third generation, must fight for “due process of law” anew, for the simple reason that power corrupts.  Maybe Magna Carta is an eternal and ever-contemporary event. The times, people and circumstances change – King John is long gone –  but the principles remain the same.

And remain as fragile.

 

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* We should note that in a different context, the SCOTUS became quite active on 14th amendment due process with the 1905 decision in Lochner v. New York.  But Lochner involved the “striking down” of laws enacted by legislatures.  This kind of case is far more removed from the due process enshrined in Magna Carta than the cases we are reviewing here.

 

Death Threats. Harassment. Obsession. (Amanda Knox)(Updated)

So a British tabloid that has been fanning the flames of the frenzied mob for eight years now reports that the FBI is investigating some of its readers.  Pretending to be neutral at this late date, after years of smearing and base casuistry masquerading as ‘journalism’.

The FBI can investigate away, and contrary to the impression given by the article, not all the lunatics are in the UK; there are plenty of people in the US who are driven mad by high profile acquittals, especially when the beneficiary is a pretty young woman.

We suspect this will go on for quite some time.  Our standing recommendation to the exonerated is to live as obscurely and remotely as possible in a country other than the one that convicted you in the first place.  Of course this reasonably requires the exoneree to be independently wealthy.  And that is exactly what those responsible for the wrongful conviction are obligated to ensure:  that their victim be made independently wealthy.

Wealthy or not, the exoneree will live out a substantially diminished life.  There’s no fixing it.  But leaving an exoneree to fend for herself, defenseless, in a world in which so many want to see her suffering or dead is literally excruciating and utterly unconscionable.

If you let loose the dogs of war in error, there’s no going back.  Prosecutors should think hard about what they set in motion when they file charges.

Update:  Radley Balko points out that we’re very, very lousy at compensating those we have injured through major malfunctions of the criminal justice process.  That has to improve.

Fraud Is As Fraud Does

I don’t think anyone can really tell you the point at which fraud, as a civil matter, crosses a line and becomes a criminal matter.  For that reason, all criminal fraud prosecutions are suspect, because their criminal nature is ill-defined.

But that does not by any means imply that fraud is unimportant.  At least not to us here at Lawyers on Strike.  We are of the opinion that civil cases are just as socially important and often more socially important than criminal cases.  In the fraud context we have taken the interesting position (well, it should be interesting for a lot of people but apparently it isn’t) that Wall Street corruption and perhaps some government corruption would be far better addressed by private lawsuits brought by the injured parties as opposed to criminal prosecutions conducted by the government, and that the major impediment to pursuing that remedy robustly is a corrupted judiciary which favors institutional litigants over individuals, for the most part depriving them of jury trials.  Which in turn are the only way, say, the Wall Streeters might be called to account.  Because regulatory capture, among other things.

But we must also recognize that we are pretty much alone in those views.  So alone, in fact, that there’s almost no chance any serious effort along those lines will be made.  At least not in our lifetime.

There’s a lawyer/law professor out there named William K. Black.  We like him over here even though he apparently doesn’t agree with us either, and thinks government regulation and criminal prosecutions are the solution.  Yet we keep trying to suggest our idea to him, with no response (scroll down to the first comment).

Which is too bad.

But moving on.  Unlikely though it may seem, our federal judge from Nebraska has recently tipped his hat in our direction by putting up a post featuring a well-known personal injury Plaintiff’s attorney exploring the idea that civil litigation – even personal injury litigation – has important social benefits.  And it’s worth noting how even in the title of the post the bias comes out, since Judge Kopf felt the need to acknowledge those who would call the featured lawyer “infamous” rather than simply famous.

I would call it subtle bias, but to me at least it is none-too-subtle.  And I daresay it has affected many, many rulings by Judge Kopf over the years, just as for Bill Black the only litigation he’s interested in is litigation on behalf of the government.

At some point I may go on from these anecdotal musings to describe how, in my view, there’s a loss of faith involved.  Faith in each other, in our ability to figure out the truth based upon evidence, in our rationality and capacity to be just.  And how this loss of faith engenders a kind of tyranny when it becomes widespread in a society.

But that’s too much for today.  Because football.

Good For Detroit

After the financial “industry” has gutted real, actual productive industries everywhere, but nowhere so much as the Motor City, Detroit is succeeding in putting the shoe on the other foot:

The loudest grumbling has come from some creditors which stand to lose big money if Rhodes approves the bankruptcy plan. Bond insurer Syncora Guarantee has said its claim is about $400 million and that Detroit has unfairly discriminated against financial creditors.

 

“High stakes gambler Bond insurer”.  Please. 

I’m not under any illusions that the public employee pensioners – probably the biggest players in Detroit’s bankruptcy – are paragons of economic virtue, but as between them and bond insurers I have no quarrel with a brush cut for the former and shaved heads for the latter.

Of course after this there will be a flurry of legislative proposals to “reform” municipal bankruptcy law, sponsored by the usual suspects – JP Morgan Chase, Citigroup, etc.

But you take your comfort when whatever small measure of justice happens in this world.