Parking Fines Are Unconstitutionally Excessive, Violate Due Process, Claims Class Action Suit

Jennifer Abel
writes in Consumer Affairs
about an interesting
approach to fighting parking tickets: a class-action federal suit
complaining that the end result consistutes an unconstitutionally
“excessive” fine.


Lead plaintiff Jesus Pimentel ran up a $63 expired parking meter
fine, which is bad enough, but the city gave him only two weeks to
pay before doubling the fine. Then there was a $28 “delinquent” fee
and a $21 “collection” fee. Add it all up and Pimentel was out
$175, which he thinks is so excessive it’s
downright unconstitutional, Courthouse
News Service

Besides the money, Pimentel was miffed when the DMV threatened
to withhold his car’s registration if he didn’t pay up, the city
threatened to boot and impound his car while also holding out the
possibility of civil litigation, damage to his credit rating and
garnishing of his state tax refund. This, says Pimentel, violated
the Due Process clause…..

Pimentel’s fines come to 336 percent of the daily median
income for a Latino Angeleno.

I wrote last month on how the
pettiest end of state enforcement of laws
things like vehicular and body movement can quickly escalate to
life-ruining problems.

[Hat tip: Jeff Patterson]

from Hit & Run

Howard Davies On The Banks That Ate The Economy

Authored by Howard Davies, originally posted at Project Syndicate,

Bank of England Governor Mark Carney surprised his audience at a conference late last year by speculating that banking assets in London could grow to more than nine times Britain’s GDP by 2050. His forecast represented a simple extrapolation of two trends: continued financial deepening worldwide (that is, faster growth of financial assets than of the real economy), and London’s maintenance of its share of the global financial business.

These may be reasonable assumptions, but the estimate was deeply unsettling to many. Hosting a huge financial center, with outsize domestic banks, can be costly to taxpayers. In Iceland and Ireland, banks outgrew their governments’ ability to support them when needed. The result was disastrous.

Quite apart from the potential bailout costs, some argue that financial hypertrophy harms the real economy by syphoning off talent and resources that could better be deployed elsewhere. But Carney argues that, on the contrary, the rest of the British economy benefits from having a global financial center in its midst. “Being at the heart of the global financial system,” he said, “broadens the investment opportunities for the institutions that look after British savings, and reinforces the ability of UK manufacturing and creative industries to compete globally.”

That is certainly the assumption on which the London market has been built and the line that successive governments have peddled. But it is coming under fire.

Andy Haldane, one of the lieutenants Carney inherited at the BoE, has questioned the financial sector’s economic contribution, pointing to “its ability to both invigorate and incapacitate large parts of the non-financial economy.” He argues (in a speech revealingly entitled “The Contribution of the Financial Sector: Miracle or Mirage?”) that the financial sector’s reported contribution to GDP has been significantly overrated.

Two recent papers raise further doubts. In “The Growth of Modern Finance,” Robin Greenwood and David Scharfstein of Harvard Business School show that the share of finance in US GDP almost doubled between 1980 and 2006, just before the onset of the financial crisis, from 4.9% to 8.3%. The two main factors driving that increase were the expansion of credit and the rapid rise in resources devoted to asset management (associated, not coincidentally, with the exponential growth in financial-sector incomes).

Greenwood and Scharfstein argue that increased financialization was a mixed blessing. There may have been more savings opportunities for households and more diverse funding sources for firms, but the added value of asset-management activity was illusory. Much of it involved costly churning of portfolios, while increased leverage implied fragility for the financial system as a whole and imposed severe social costs as over-exposed households subsequently went bankrupt.

Stephen G. Cecchetti and Enisse Kharroubi of the Bank for International Settlements – the central banks’ central bank – go further. They argue that rapid financial-sector growth reduces productivity growth in other sectors. Using a sample of 20 developed countries, they find a negative correlation between the financial sector’s share of GDP and the health of the real economy.

The reasons for this relationship are not easy to establish definitively, and the authors’ conclusions are controversial. But it is clear that financial firms compete with others for resources, and especially for skilled labor. Physicists or engineers with doctorates can choose to develop complex mathematical models of market movements for investment banks or hedge funds, where they are known colloquially as “rocket scientists.” Or they could use their talents to design, say, real rockets.

Cecchetti and Kharroubi find evidence that it is indeed research-intensive firms that suffer most when finance is booming. These companies find it harder to recruit skilled graduates when financial firms can pay higher salaries. And we are not just talking about the so-called “quants.” In the years before the 2008 financial crisis, more than a third of Harvard MBAs, and a similar proportion of graduates of the London School of Economics, went to work for financial firms. (Some might cynically say that keeping MBAs and economists out of real businesses is a blessing, but I doubt that that is really true.)

The authors find another intriguing effect, too. Periods of rapid growth in lending are often associated with construction booms, partly because real-estate assets are relatively easy to post as collateral for loans. But the rate of productivity growth in construction is low, and the value of many credit-fueled projects subsequently turns out to be low or negative.

So, should Britons look forward with enthusiasm to the future sketched by Carney? Aspiring derivatives traders certainly will be more confident of their career prospects. And other parts of the economy that provide services to the financial sector – Porsche dealers and strip clubs, for example – will be similarly encouraged.

But if finance continues to take a disproportionate number of the best and the brightest, there could be little British manufacturing left by 2050, and even fewer hi-tech firms than today. Anyone concerned about economic imbalances, and about excessive reliance on a volatile financial sector, will certainly hope that this aspect of the BoE’s “forward guidance” proves as unreliable as its forecasts of unemployment have been.


via Zero Hedge Tyler Durden

Citing Joke, Annapolis Police Chief Testifies That Pot Killed 37 People on the First Day of Legalization in Colorado

Testifying against marijuana
legalization before the Maryland legislature today, Annapolis
Police Chief Michael Pristoop warned of the potentially lethal
consequences. “The first day of legalization, that’s when Colorado
experienced 37 deaths that day from overdose on marijuana,”
the Senate Judicial Proceedings Committee. “I remember the
first day it was decriminalized there were 37 deaths.”

As Sen. Jamie Raskin (D-Montgomery) quickly pointed out, what
Pristoop actually remembered was a
joke story
at The Daily Currant headlined
“Marijuana Overdoses Kill 37 in Colorado on First Day of
Legalization.” The article included a quote from “Peter Swindon,
president and CEO of local brewer MolsonCoors,” who supposedly
said: “We told everyone this would happen. Marijuana is a deadly
hardcore drug that causes addiction and destroys lives. When was
the last time you heard of someone overdosing on beer? All these
pro-marijuana groups should be ashamed of themselves. The victims’
blood is on their hands.”

Pristoop seemed taken aback that something he had seen in print
might not be the literal truth. “If it was a misquote,” he told
Raskin, “then I’ll stand behind the mistake. But I’m holding on to
information I was provided.”

[Thanks to Tom Angell of Marijuana Majority for the tip.]

from Hit & Run

Hey Boston Reasonoids: Happy Hour with Nick Gillespie Wed., 2/26, 6-8pm

I’ll be in Boston for business this week and
we’re throwing together a happy hour in Beantown on Wednesday,
February 26, from 6 to 8pm ET.


Join Reason’s Nick Gillespie for a Reason happy hour at the
Grafton Street Pub & Grill in Cambridge. 

The event is free but RSVPs are required – email Amy Pelletier

The Grafton Street Pub offers free parking at a neighboring
church; we’ll email you a parking pass after you RSVP. You can also
take the Red Line train to Harvard Square.

to see you there.

from Hit & Run

California Bill Would Amend Silly “No Bare Hands Can Touch Ready to Eat Food” Rule

 Southern California Public
on some possible sense
 coming down the pike
regarding a new California law barring bare hands from touching
ready-to-eat foods:

Assemblyman Richard Pan (D-Sacramento), chair of the Assembly
Health Committee, said AB 2130 would replace the language in the
state health code that took effect Jan. 1st that
barred sushi
, bartenders and others from handling ready-to-eat foods
with their bare hands.

Pan’s bill would permit some bare hand contact, stipulating that
preparers must “minimize bare hand and arm contact.” The chef or
bartender would also need to wash his hands in accordance with
current state health regulations….

I blogged about this rule, especially how it
enraged serious sushi chefs
, last month.

A Reason TV video on the matter,which makes the point
that no compelling public health problem connected to food
preparers bare hands has been demonstrated:

from Hit & Run

Bank Bonus Bonanza

Remember when you were a kid and you got extra pocket-money for doing absolutely nothing? The joy that lasts ephemerally, but is none the less a welcome boost to your dire finances as a kid. When all is said and done there is very little between that kid and the HSBC bankers that are getting their increase in pocket money these days to avoid the cap on salaries from the European Union. You have to hand it to the Brits, they defy the EU, slap Brussels in the face and then go and ask them to pay for the weather damage to the country. Have they no shame? I guess where money is concerned, shame doesn’t have a lot of room. The trouble is, that kid / banker will be needing more and more of the increase in his pocket money in the future. It’s all about satisfiers and dissatisfiers. What satisfies today will become the source of dissatisfaction tomorrow.

HSBC Bank has been giving Chief Executive Stuart Gulliver £32, 000 ($53, 000) a week extra to avoid the cap on his salary (now at £1.2 million ($2 million). Either HSBC is just the first bank to admit doing it or the others will now quickly follow suit. What a double waste of money. Laws are obviously there sometimes to have smart guys thinking up new ways to dodge them. The art of the administration should be to constantly work to get around the tricks of the trade and paper over the cracks in the walls that allow for such things to happen. But, the EU is a machine that takes ages to actually get into motion; the cogs of the wheels move so slowly that the banks have thought up ways of getting around the voiced opinions that have petered out into a mere echo heard now far off in the distance.

It’s all about side-stepping and HSBC has just disdainfully rebuffed the boys from Brussels. As if the pocket money wasn’t enough, the bank has also revealed that there are 239 bankers working for the HSBC that were paid £1 million in 2013. Boardroom greed it was once called, with soaraway proportions. The European Union had stated that banks would have to restrict bonuses and cap them at 200% of salary. Stuart Gulliver has taken on the guys from Lilliput and whereas the latter used to be no bigger than six inches tall, the former is obviously into six-figure sums rather than anything else.

• Gulliver will be getting £1.7 million paid out every quarter, ensuring that his salary and bonuses combined reach £4.2 million a year. 
• HSBC will be giving 554 bankers cash bonuses.
• 111 will be getting shares that cannot be sold for a period of five years.
• Gulliver also gets £79, 000 for the use of a car in Hong Kong. 
• Accommodation expenses stand at £229, 000. 
• Profits posted by HSBC have risen by 9%, reaching $22.5 billion at the end of last year. 
• Bonuses rose to $3.9 billion, which is a 6%-increase. 
• Dividends for shareholders rose by 11% and staff costs have fallen by 6%.

It is expected that Barclays Bank will be doing the same. Why wouldn’t they anyhow? The Chancellor of the Exchequer George Osborne is going to try to get Brussels to reverse the cap on bonuses and so to all intents and purposes is defending the bankers.

It’s all about satisfiers and dissatisfiers. But, obviously, the general public has always been dissatisfied with the fact that bonuses are dished out by the banksters. The champagne drinkers were satisfied once (when they had a sense of what money meant and they actually might have done something to deserve it). ‘What satisfies today will become the source of dissatisfaction tomorrow’ has never been more resounding than when it concerns bankers and the financial sector. Why does everyone keep on harping on about why the bankers get silly money that only you and I can see in the newspapers? The bankers got given ridiculous sums. Ridiculous became absurd and absurd turned into harebrained simply because they were constantly dissatisfied by the amounts that were being given to them. Neither the European Union nor the governments of any of our super-rich (virtual) and yet desperately-and-critically-in-debt countries will ever be able to stop the bankers from getting their gelastic bonuses.

Originally posted: Bank Bonus Bonanza



via Zero Hedge Pivotfarm

WTF Chart Of The Day: VIX Smackdown Edition

Today’s pump-and-dump that failed to hold the S&P 500 in the green for 2014 was an almost perfect deja vu all over again of yesterday’s. However, today saw a very rapid after-hours 6 point melt-up in S&P 500 futures thanks to a WTF-inspiring collapse in VIX (from 14.4% to 13.7%!!)


The pump-and-dumps…


and the WTF-inspiring smackdown in VIX…


Totally “normal”…


Charts: Bloomberg


via Zero Hedge Tyler Durden

Report Sees Rising Premiums for Many Small Businesses Under Obamacare

Actuaries from the Centers for
Medicare and Medicaid Services (CMS) estimate that about two thirds
of small businesses will see their health insurance premiums rise
under Obamacare.

The Wall Street Journal.

The report analyzed employers with 50 or fewer full-time
employees that buy outside insurance policies for workers, a group
it estimated at 17 million people in 2012. It focused on a piece of
the 2010 law that prevents insurance companies from pricing
policies based on customers’ health status.

Before this year, insurance companies could charge higher prices
if an employer had older, sicker workers. Now, under the Affordable
Care Act, insurance companies can’t price on health status and are
limited by the amount they can price by age.

The report concluded that about 65% of small businesses, or
plans covering 11 million people, would see an increase in
insurance premiums under these so-called community-rating
provisions of the health law. About 35% of employers would see a
decrease for plans covering six million people. 

The report looks narrowly at restrictions built into the law
which limit higher premiums for sicker or older workers. It doesn’t
factor small business tax credits or other parts of the law that
might affect premiums into the equation. And it doesn’t indicate
how large the increases or decreases might be. But it does
highlight the way that Obamacare’s rating rules change the cost
calculous for insurers and for employers, and the ripple effects on
coverage and costs that are likely to continue for a while into the

from Hit & Run

Qualifying opens for local, regional political posts

Qualifying starts Monday for local and regional offices in the primary and general elections that will be held later this year.

Interested candidates must qualify with their respective party, not at the county’s elections office.

The Fayette County Republican Party will be open at its headquarters at 174 N. Glynn Street in Fayetteville from 9 a.m. to 5 p.m. Monday through Thursday and Friday from 9 a.m. to noon. For information call 770-716-1545.

read more

via The Citizen