Maryland, delayed foreclosures, and herd immunity

The Washington Post notes that thousands of Marylanders are losing homes in a second wave of foreclosures. Others have already noted this hit. Worse yet, the Post article acknowledges that "foreclosure experts and state officials knew [it] was coming but no one wanted to see." So they knew it was coming, and did it anyway. Thanks for nothing. Like an ostrich with its head in the sand.

For what its worth, I think the Post is somewhat disingenuous in acknowledging that state officials knew the inevitable was coming. While it is true that some rhetoric acknowledged that the state was just delaying the inevitable, other statements suggested that the state was taking preventative measures.

The article does contrast the Maryland foreclosure process, which has been painfully drawn out over an average of 575 days (among the longest), with Virginia, whose foreclosure crisis has largely run its course (an average of 184 days, the shortest in the nation). I will be very curious to see economists do a post-mortem comparing Maryland's heavy-handed, interventionist approach to foreclosures vs. Virginia's hands-off approach.

What this article fails to deliver is a definitive verdict on Governor O'Malley's policies: is the second wave worse than it would have been if the state had just allowed foreclosures to happen? Or have they, as expected, made things worse?

In at least one measurable way, these policies have made things worse. Maryland's intervention has delayed the recovery of housing prices in Maryland, as predicted last year. As a result, homeowners not affected by foreclosures have felt the impact because their mortgages continue to be underwater. Delaying foreclosures in Maryland is akin to people choosing not to vaccinate their kids; as a result, the herd immunity (so to speak) suffers. I like to think of timely foreclosures acting as a firewall to the spread of more foreclosures. When foreclosures are delayed, everyone suffers through lower housing prices.

I was one of many who warned this time would come. I take no small bit of pride in acknowledging this. I would rather have been wrong. And while I an not a housing expert, I take my predictions and warnings seriously. I make them with due consideration to all of the available information. My track record stands by itself. And I have not been hesitant to admit when I have been wrong.

It is also no small bit of irony that this article came to my attention when it was tweeted by Occupy Wall Street. That loose collective appears to have the same short institutional memory as Anonymous--the Occupy movement has fought foreclosures at every turn. Now, it's somehow newsworthy that a policy that Occupy actively advocated--indeed, actively participated in favor of--comes back to kick people in the ass.

Law in Plain English: Bloem v. Unknown Department of the Interior Employees

This is one in a series of posts designed to describe court decisions in plain English. For more detail and background on the legal issues, see the link to the case below. For similar posts, click here.

I've made a slight change to the "SCOTUS in Plain English" series to reflect the opportunity to discuss a few cases not at the Supreme Court level that are nonetheless interesting and worthy of discussion. As a result, the series is now called "Law in Plain English."

Bloem v. Unknown Department of the Interior Employees

The National Park Service distributed flyers warning Occupy protesters in McPherson Square that they would begin enforcing a prohibition on camping. Subsequently, many items of personal property (some that belonged to Bloem) were destroyed. Bloem filed a lawsuit against the unnamed Department of the Interior employees for the seizure and destruction of his property. The DoI filed a motion to dismiss, alleging that Bloem had failed to state a claim upon which relief could be granted. The District Court ruled that the tent city was expressive conduct, permitted by the First Amendment. Additionally, Bloem's allegations that the DoI had violated his Fourth and Fifth Amendment rights were sufficient, and thus Bloem had stated a plausible claim. For purposes of a motion to dismiss, which in this case is a 12(b)(6) motion, Bloem's alleged facts are presumed by the court to be true. In other words, the court looks at the case and says: even if we assume that all of his facts are true, has he made a plausible claim? This is a procedure hurdle to make sure that baseless lawsuits don't consume valuable time of the court. As a result, Bloem's claim survived the government's motion to dismiss and the case can move forward.

From David Cannadine's Mellon: An American Life

The Occupy movement would get a kick out of this except from David Cannadine's Mellon: An American Life (p. 543); it is from a satire called Frankie in Wonderland by Mellon's son-in-law, David Bruce:

     "Order in court," said the king. "Who is the first prisoner?"
     "A banker from Pittsburgh who is in the aluminum business," answered the prosecutor, who was well known for his short cummings.
     "Guilty," shouted the King. "What crime is he accused of?"
     "He says he doesn't know, Judge," replied Short Cummings.
     "Never mind," said the King. "He's guilty anyhow, all Bankers are guilty! Especially Republican bankers! Off with his head!"

My seven demands for #occupywallstreet

In my last post, I talked about some of the reasons why I didn't (and don't) support #occupywallstreet. One of them was the rhetoric, include the use of the word "demands." Another part was the message, and some of the demands clearly fit into that category.

Turning the rhetoric and message on its head, here are my "demands" of those of you who are participating in #occupywallstreet:

1. Obey the law. This is pretty simple actually. Please note: blocking traffic is not obeying the law. You're obstructing the freedom of movement of other people. Resisting arrest is not obeying the law. What you're doing may be peaceful, but peaceful can still be unlawful. If you need to get a permit, then go get one.

I'm not in NYC, but it seems to me that most people are already doing this. So good on you.

2. Vote. I would be willing to bet that probably half (or perhaps even more) of the people at #occupywallstreet either aren't registered to vote, or didn't vote in their last election. Or the one before that, or the one before that. All the statistics show that the younger one is, the less likely it is that they vote. So go register and vote. Because if you don't, I (and others) don't want to hear you complain. If you already vote, then great. You can move on to #3. If you don't vote, or aren't even registered, then this item is for you.

3. Stop making bullshit excuses to get out of jury duty. Along with your rights as a citizen come certain responsibilities. Jury duty is one. So take pride in this responsibility and stop trying to invent ways to avoid it.

4. Patronize the street vendors. The New Republic reported that some of the street vendors in the area are losing a lot of business because of the occupation. Some of you are going to complain that's because the NYPD set up barriers. "It's their fault, not ours!" Fine. Then seek out these hard-working people and patronize them. According to the article I cited above, they're blaming you. So go fix that problem.

5. Promote transparency and accountability. I noted that the wepay.com donation accounts have no transparency or accountability into how donations are being spent. Why should I (or anyone) donate money if I have no idea how that money is being spent? Or if it's being spent in the way I intended, at all? All donations and expenditures should be made public so that people can see how their support is being used.

6. Be a good neighbor. Some of the people who live in the area complained that #occupywallstreet is loud and keeping them up at night. How about having some respect for the people who actually live there (as opposed to your temporary occupation) by being respectful during the hours when most people are usually sleeping.

7. Stop feeling entitled. I recognize that not everyone at #occupywallstreet is young, but from everything I've seen via social media, pictures, etc., younger people make up the biggest percentage of you. Rightly or wrongly, you are viewed as a entitlement generation. Going into McDonald's and getting mad when you ask for, and don't get free food, only reinforces that notion (cited in The New Republic article). Asking for forgiveness from mortgages and student loans, any and all debts? The same thing. Every time you ask for something, you are reinforcing what people already believe about you. Honestly, I don't care about if you truly feel that way or not. That is the perception that people have about you. There are 6,780,000 hits on Google for the entitlement generation.  You have to work hard to change that perception. Otherwise you play right into people's perceptions. Instead of asking, highlight the areas where you as citizens have contributed to society.

Take a look back at these seven "demands." Are they really all that much to ask for?

Seven reasons why I don't support #occupywallstreet

Let me start out with the immediate caveat that I fully support the right to peaceful, non-violent, non-disruptive protest. On the other hand, blocking traffic, for example, is disruptive. It prevents the freedom of movement of other people. It might be peaceful, but it is disruptive and unlawful. So don't be surprised if that gets you arrested. But enough of that.

A second caveat: this is my response to #occupywallstreet as it is seen through social media, specifically Twitter and Facebook, and also some other related Internet sites. I am not on the ground, I haven't been there, and I don't intend to go there. With a few exceptions, I have tried to stay away from the "news" and "MSM" coverage since that itself is a huge issue. So if you have issue with my view of how things are going down, perhaps your independent media types need to do a better of crafting the message.

Let me also state up front that I expect many people to disagree with me. I'm not trying to convince you to abandon your side. I'm just explaining my side. I don't claim to speak for 1% or 99%. I speak only for myself. Oh, and please send your intelligent responses to this guy.

Tim O'Reilly wrote a post a while back about #occupywallstreet and generally lamented that

 the people who were there were the wrong people...It seems so odd to me that the Tea Party isn't out in force at this protest. It seems so odd that government largesse aimed at rich corporations seems to be OK with them, while government largesse aimed at the disadvantaged ought to be cut. I would have loved to see blue collar Americans out in force at this protest, not just college students.

I've never self-identified myself as "Tea Party" but I might as well be. I'm a married white male in my mid-30s, a conservative-libertarian who isn't afraid to criticize the Republican Party when they stray too far from the party's principles. I'm one of the types of people that Tim O'Reilly thinks should be out protesting on Wall Street. But I'm not, so this post is meant to explain why.

First, my back-story.

I was born in Reading, Pennsylvania, which had the recent distinction of being named the poorest city in the United States. It wasn't quite that bad when I was born, but Reading is a blue-collar industrial place that rise and fell with the railroad. It has never quite been the same since then.

I was fortunate, at a very young age, when my parents moved us just outside the city limits. Rather than having to survive the rough streets of Reading, I grew up in an otherwise nondescript middle class neighborhood and grew up mostly middle class. By the time my brothers and I were in school, my mom went back to work and both parents worked. We had enough.

Throughout school, I worked; first delivering newspapers. Then at a farmer's market. Then at K-Mart. Then at the local hardware store. None of these jobs were beneath me.

I did well enough in high school to get decent grades without working very hard. I enjoyed sports more than school. My sights, instead, were set on college.

I started college in a small, liberal arts school in Virginia. It was expensive, but there was financial aid and student loans. I could do this. Things started out OK, but very soon it became apparent that a butt-load of the financial aid I had been promised was not going to appear. As a result, after one single semester in Virginia, I transferred to Bloomsburg University, a state school back in Pennsylvania that would cost me considerably less. Despite the transfer, I worked hard and graduated in 3 1/2 years total.

Like most political science majors, I wasn't really sure what I wanted to do. I was leaning toward law school, and that became plan A. Beyond that, there was no plan B. Yet on a whim, I applied to Georgetown University's National Security Studies program and (somehow) got accepted. This was my new plan A, but it was Georgetown. One semester at Georgetown was more expensive than three years at Bloomsburg. I kept working hard, took on a part time job, and got my Master's Degree in only three semesters. But the student loans kept on mounting. I was digging myself into some serious debt by the time I graduated.

That was 1999. Fast-forward 12 years to the present. I'm still paying off my student loans, can you believe it?! I'm paying off a mortgage that is probably worth more than the current value of my house. If I wanted to move now, it would be very difficult, if not impossible. I opposed bailouts across the board.

So why I am not at #occupywallstreet?

1. Rhetoric. I've mentioned this before, but the rhetoric is over-the-top and largely fringe leftist in nature. Revolution, occupation, solidarity, comrades. I grew up at the peak of the Cold War. This language is not foreign to me. Yes, they're just words, but words mean things. And I don't like the things that these words mean. Additionally, the strong anarchist, socialist and anti-capitalist tones aren't going to attract me, either.

Closely related, the other bit of rhetoric that bothers me is the constant class warfare. It permeates everything that I see about #occupywallstreet and ties it all together. 1% vs. 99% is a perfect example of it. Seriously, put down the Karl Marx. It didn't work then and it won't work now.

The rhetoric is so over-the-top that I totally whiffed on @The99Pct, which I understand now (in embarrassed hindsight) is a parody account. Sadly, many of the posts aren't too far from what I've seen (especially online).

Like it or not, this point alone will keep people away. Viva la revolucion! But very few on the Right are going to join you, even if they agree on the core issues.

2. Message. People keep saying that #occupywallstreet is leaderless, but they shouldn't have to. It's pretty obvious. Many groups showed up making sure to get their message out. Against Bush, against the wars, against this or that or  the other thing. They, collectively, are against so many things I've lost track. And that's sort of the point. What is the message? The "official" demands keep growing and changing. At one point, the demands included references to Troy Davis and the elimination of the death penalty. It has nothing to do with Wall Street. It's an attempt to link a supposedly populist cause to the "occupation."  This is an example of what the military would call mission creep.

I've talked before about the negative connotations you send when you use words like "demand." This goes hand in hand with the point I mentioned above about rhetoric, but it applies equally here.

Among their declaration and demands, they claim that corporations "have sold our privacy as a commodity." Yet they're using corporations to get their message out. Facebook is perhaps the most notorious social network for privacy violations, yet #occupywallstreet has a home there.

3. Hypocrisy. One of the many themes espoused by those at #occupywallstreet is to decry the influence of money in politics. They seem to hate Citizens United and the whole idea of corporate personhood. I understand this. In some ways, I am sympathetic to the cause. However, the same people who despise the influence of money in politics are happy to welcome the support of multiple unions (re-read that Citizens United link; it doesn't just protect corporate funding of independent spending for political broadcasts, but also union funding). And it's known that the biggest spender in the 2008 election cycle were not corporations, but unions. So it seems hypocritical to complain about the influence of corporate political spending, while cozying up to unions, who actually spend more on politics.

And then recently, #occupywallstreet welcomed the support of MoveOn.org. It has been well-documented that MoveOn has been heavily funded by the billionaire George Soros. It seems further hypocritical to scream bloody murder every time the Koch Brothers spend a dime on politics, but just shrug away the same sort of political spending by George Soros. This inconsistency in the message reeks of hypocrisy.

Don't claim (without evidence) that corporate donations to the NYPD are buying off the police, but that Michael Moore and MoveOn support to #occupywallstreet are somehow beyond question.

4. Antisemitism. Despite the "leaderless" claim, there are still groups behind #occupywallstreet. One of them is Adbusters, has been accused in the past of antisemitism. A freelance writer by the name of Nathalie Rothschild wrote an article about her experiences at #occupywallstreet:

But the responses I got to my article were even more astonishing than the carry-ons in the Financial District. I received a string of indignant emails and tweets about my Jewish, kleptocrat banking connections; demands that I reveal the details of my pay checks and that I come clean about my not-so-hidden agenda. I was told that my family name disqualifies me from having any opinion about the protest and that I have 'the karma of a demon'. One reader posted my article online, headlining the post 'Journalist & Jew - Nathalie ROTHSCHILD'.

This is pretty sickening stuff. Please, it's about time for someone at #occupywallstreet to stand up and condemn this stuff. But they won't, because...

5. There is no accountability. I've talked about this before in regards to Anonymous. Anonymity allows people to take credit for anything good that happens while simultaneously reject all bad things as "someone else." Anyone can do something in our name, they say, so we can't be responsible. The same goes for a "leaderless" organization. No one is accountable. No one will stand up to the antisemitism that Nathalie Rothschild faced. Multiple wepay.com pages are set up for #occupywallstreet, collecting thousands of dollars in donations with little or no accountability in how that money is being spent.

6. There is no accuracy. Claiming the top 1% don't pay any taxes is as silly as those people at the town hall meetings a few years back who told the government to stay away from their Medicare. The truth is that the top 1% of earners pay over 38% of all income taxes. They pay 23.27% of their income to federal income taxes. On the other end, the bottom 50% of earners pay less than 3% of all income taxes and are taxed, on average, 2.59%. In fact, most of the bottom 50% pay no federal income taxes at all.

When you start out your argument with a claim like this, it shows you as being uninformed. I stop listening to anything else you have to say. The truth is that we have a highly progressive income tax system already.  A Buffet tax (a proposal of the President and also one of the demands) won't even hurt the man it's named after because most of his income is through capital gains, not salary. Your demands are built on claims that wash away like a sand castle built right up against the water at low tide.

7. I have a job. This isn't meant to be cruel to the unemployed, but I do in fact have a job. In fact, I have my own business. I can't spent weeks marching around New York City because I actually go to work everyday. I don't mean this to sound harsh, but sleeping on cardboard and eating pizzas paid for by someone else is not contributing to our economy. From an economic perspective, you are not contributing to the collective, common good. You're not doing your fair share.

Despite signs to the contrary, you do not have a "right" to a job. And the job you might land might be at Wal Mart or McDonald's. If you think working a retail or fast food job is beneath you, then maybe you're at the wrong protest. Wear our your shoes pounding the pavement looking for a job instead of waving a sign. Don't bitch that the 99% pay too much in taxes if you're not working; because if you're not working, you're obviously not paying income taxes.

I welcome your comments, criticisms, and questions below this post or via Twitter.