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July 21st, 2014

7/21/2014

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IT'S CALLED SOVEREIGN DEBT/MUNICIPAL BOND FRAUD FOLKS------NEO-LIBERALS SIMPLY FOLLOW WALL STREET'S LEAD NO MATTER WHERE IT ENDS.


I'd like to spend one more day on the bond market and the coming crash.....looking today at the public and private pensions.  Folks, neo-liberals and neo-cons look at pensions as fodder only meant to boost Wall Street profit. 

LOOK AT WHERE YOUR PENSIONS ARE INVESTED BECAUSE MARYLAND IS RUN BY NEO-LIBERALS WORKING FOR WALL STREET PROFIT AND NOT YOU AND ME!

I pointed to Maryland pol Dulaney and his focus on repatriation taxes and bond market for corporations.  The timing of this legislation is no accident----the bond market crash will place this market at the bottom ready to climb to profits just as the 2008 crash made the stock market bottom.  So, Dulaney is not warning his constituents that the bond market crash is coming and will take away most of the value recovered since the last crash-----he is only thinking of what legislation with maximize corporate profit.  THAT'S A NEO-LIBERAL FOR YOU BUT WHY IS HE RUNNING AS A DEMOCRAT????

The second point is that as you can see all of the major news journals are now reporting the crash is coming just as I have written for four years.  What I said was the plan-----and everyone knew it.
  Please consider where you get your information-----all neo-liberal media like MSNBC and NPR never mentioned these policy goals-----

I spoke of the public malfeasance behind the public pension losses last crash were politicians moved public pensions from the then safety of the bond market into a collapsing stock market in 2007 just to buoy the Wall Street banks.  THIS WAS ILLEGAL AND PUBLIC MALFEASANCE AND FRAUD. All of the pols in Maryland involved in doing this were simply re-elected and public sector unions simply agreed to cuts rather than take the fraud to court.  The failure to address the last fraud has the same thing coming with this bond crash.....public and private pensions have been used to buoy the coming bond market as investment firms jump ship. 

DO YOU HEAR YOUR POLS SHOUTING ALL OF THIS IS BAD FOR THE PEOPLE WHO ELECTED THEM???????  I DON'T HEAR A THING!


Below is a UK article that speaks to what is coming.  Look how it states the FED is considering making people stay in the bond market to stop a run.  It created the conditions for the crash and now it wants to force people to stay in......punitive exit fees.
  Remember, people went to bonds because the stock market is criminal.......they are now being forced back into this criminal market because Wall Street imploded the only safe investment ------bonds.

Can you save your pension from the great bond bubble? Why a bank rate rise could ruin your retirement...

‘Those limits will be set by each individual fund — they may put a cap on how much you can withdraw, or reduce the value by a percentage.’


By Holly Black  Daily Mail Pensions and Retirement

PUBLISHED: 18:34 EST, 17 June 2014 | UPDATED: 03:20 EST, 18 June 2014

About £800billion of savings and investments sitting in bond funds could fall in value if interest rates begin to rise.


An increase in the Bank of England base rate threatens to burst the five-year bond bubble that has seen the value of funds soar by as much as 137 per cent.

It threatens to wipe out a chunk of the life savings of an estimated 500,000 people who have put their money into bond funds, and millions more in company pension schemes.


Bond bubble: When interest rates rise the value of bonds will fall



However, while any rise in rates is likely to cause a fall in bond funds - any increases should be small, giving investors time to react. There are, though, fears that money in bond funds could be locked up.

In the U.S. there are already reports that the Federal Reserve is considering imposing punitive exit fees on anyone trying to take their money out of bond funds to halt a run on the investments.



Brian Dennehy, founder of investment research site Fund Expert, explains: ‘When there is sustained heavy selling there will almost certainly be restrictions, if you’re allowed to sell at all.


‘Those limits will be set by each individual fund — they may put a cap on how much you can withdraw, or reduce the value by a percentage.’


Bonds are essentially IOUs issued by companies and governments. In exchange for your money, they promise to pay you a rate of interest. These are not fixed-rate savings bonds offered by High Street banks and building societies, which keep your capital safe and your interest fixed.


With investment bonds the value can rise and fall, and they were often seen as a safer type of investment, as they don’t change in value very much. But because of poor rates on High Street savings accounts, bonds have become wildly popular and, as a result, prices have surged.


Someone who put £10,000 into the average strategic bond fund five years ago would have £15,500 today. The best fund would have grown to £23,700.


At risk: A substantial chunk of the £770bn of our pensions is invested in bonds



How £800billion could be trapped
Fears of a fall in value of these funds could now lead to a great bond sell-off. A bond-fund plunge has been widely expected since late 2012.



Then, the value of funds had increased by 50 per cent following the Government’s policy of printing money to boost the economy, known as Quantitative Easing. This involved the Bank of England flooding the economy with cash, by buying bonds — which led them to increase in value.


Now that QE has come to an end, and the economy is recovering, interest rates could soon rise. When this happens, the value of these bonds will fall, and the interest they are paying will suddenly seem less attractive.


Unlike with shares, the money in bonds is tied up. It means that investors may not be able to trade their bonds freely to eager buyers, leaving them trapped because no one will want to buy them.


Retail investors who have relied on bonds for the past six years have a massive £126billion of their savings tied up in these funds. But a substantial chunk of the £770billion of our pensions is invested in them, too, because many stock-market-linked company schemes move savers’ money into bonds the closer they get to retirement.


This is done to protect the cash they have built up over the years by transferring it out of supposedly riskier stocks and shares. The strategy is known as life-styling and happens automatically. But it has meant that workers are being unwittingly exposed to any potential fall in the bond market.


Thousands of investors found themselves stuck in property funds in 2008 when there was a run of people withdrawing cash from these investments. A lack of ready cash available in them meant firms were telling their customers they could not have their money.


Many property funds own entire buildings directly so that if they need to raise money they have to sell them, rather than just sell shares, which is a much quicker and easier process. Bond funds face similar problems.

Bonds have a fixed duration and if funds can’t find a willing buyer to dispose of them, they will have to hold onto the investment. That means they can’t raise any money to give back to investors looking to sell their units in the fund.

Should you hang on or try to sell?
Many fund managers are already selling their bonds. Marcus Brookes, head of multi-manager funds at Schroders’, has reduced his bond holdings to just 10 per cent of his assets and he is planning to sell more.

  ‘Returns have been amazing for too long and we’re starting to worry,’ he says. And Mr Dennehy points out that with interest rates likely to rise in ‘baby steps’, investors shouldn’t have to rush out of all of their bonds at once.

‘But you should still ask yourself why you are bothered to invest in bonds,’ he adds. ‘At best, they won’t lose any of your money this year, but I don’t think they will make any either.’


Yet this could leave investors with another dilemma. Ben Gutteridge, head of fund research at wealth management company Brewin Dolphin, explains: ‘If you are taking your money out of bonds, where are you going to put it?


‘The obvious choice is equities. But if all of your investments are equities, that’s incredibly risky.’


Because of this, investors may be forced to accept the risk of staying in bonds in a bid to spread the risk in their portfolio.

Or else they may have to pull out of the stock market completely and bide their time in cash just to make sure that they’re not losing any money.


__________________________________________

Wall Street and their pols knew people would leave the stock market for the safety of the bond market after the 2008 crash so they started immediately to create the conditions to fleece these bond investors.  Congress and Obama created legislation that pushed US bonds to the world market just as they did subprime mortgage loans they knew were fraudulent.  Watching the FED and QE create the ballooning of the bond market just to accommodate Wall Street profit knowing a bond collapse would hit Federal, state, and local governments hard.

IT IS A CRIME AGAINST HUMANITY!!!!  THESE ARE SOCIOPATHS FOLKS!


Public pensions were never too much to handle for states and local governments-----neo-liberals simply never intended to fund them just as corporations were never made to actually fund their contributions as these benefit packages required.  So, there is no pension deficit weighing on governments----it is the fiscal policy schemes that are designed to bring ever more money to Wall Street that are soaking taxpayers.  Below you see just another financial instrument that again placed public wealth in harms way.  Remember, we went through a fiscal boom last decade albeit fueled by corporate fraud so government coffers should be flush.  Rather, billions of dollars were lost to public malfeasance and fraud.  The article below shows states using pension investments that were known to be bad policy-----placing bonds into plans at the wrong time and this is not an accident.  It takes no rocket scientist to know all of these investment strategies were bad for the public.  These neo-liberals did it to hide debt to take on more debt knowing Wall Street would bring in tons of profit.


The story of Oregon is Maryland's story and Martin O'Malley and the Maryland Assembly are the stars of this public abuse.
  Now, the same thing was done for private pensions as corporations were allowed to fail to fund and place pensions into ever riskier investments everyone knew would fail.

Just think.......if we all knew years ago that the policies since the 2008 crash would implode the bond market-----do you leave state and local governments exposed to bond leveraging?  OF COURSE NOT UNLESS YOU WANT TO IMPLODE GOVERNMENT BUDGETS.

Pension Obligation Bonds: Risky Gimmick or Smart Investment?

Pension obligation bonds have bankrupted whole cities. Yet some governments are still big players. BY: Eric Schulzke | January 2013



“It’s the dumbest idea I ever heard,” Jon Corzine told Bloomberg.com in 2008 when he was still governor of New Jersey
. “It’s speculating the way I would have speculated in my bond position at Goldman Sachs.”

Corzine, who followed up his tenure as governor with a $1.6 billion investment debacle as chairman of MF Global, seemed to know a thing or two about risky ventures. In this case, he was speaking of pension obligation bonds. POBs are a financing maneuver that allows state and local governments to “wipe out” unfunded pension liabilities by borrowing against future tax revenue, then investing the proceeds in equities or other high-yield investments. The idea is that the investments will produce a higher return than the interest rate on the bond, earning money for the pension fund. It’s a gamble, but one that a lot of governments are willing to take when pension portfolio returns plummet, causing unfunded liabilities to run dark and deep.

Almost every fund has faced such liabilities from time to time, though current times have been more treacherous than others. As Paul Cleary, executive director of the Oregon Public Employees Retirement System (PERS) points out, since 1970 his state’s pension fund has suffered annual losses only four times
. But three of those losses were in the last decade, and one, in 2008, was a catastrophic 27 percent decline.

Faced with such losses -- and with a dearth of state and local revenue to make up for the shortfalls -- POBs have become a favored tool to fix pension woes. Oregon is a big player in the POB market, along with scores of its cities, counties and school districts. Other major POB issuers include California, Connecticut, Illinois and New Jersey.

The bonds took on some notoriety this past summer when two California cities, Stockton and San Bernardino, went bankrupt. Generous pensions awkwardly propped up with ill-timed POBs contributed to both debacles.


Over the years, returns on POBs have often fallen below the interest rate the state or locality paid to borrow the money, digging the liability hole even deeper
. Nonetheless, they remain popular with politicians in a revenue pinch. Politically, it is easier to borrow money to pay for pension costs than it is to squeeze an already-stressed budget. While many economists and policy analysts view them as risky gimmicks and question the high market growth assumptions that make them seem viable, POBs have defenders who believe that with careful timing they can pay off.

When Oakland, Calif., launched the first pension obligation bond in 1985, it appeared to be a reasonable strategy. It qualified as a tax-free bond that could be issued at the lower municipal bond rates. A state or city could then pivot and invest the funds in safe securities -- a corporate bond, for instance -- at a slightly higher rate. “That was classic arbitrage,” Cleary says. “You were locking down the difference between nontaxable bonds and taxable bonds.”


The Tax Reform Act of 1986 ended that strategy by prohibiting state and local governments from reinvesting for profit the money from tax-free bonds. When the concept resurfaced, the strategy called for states or localities to issue a taxable bond and leverage the higher interest rate of that bond against higher return but riskier equity market plays. So long as markets boomed, the new tactic seemed savvy. “Some people call this arbitrage, but it’s not,” Cleary says of post-1986 POBs. “It’s really an investment gamble.”

Arbitrage occurs when prices for the same product differ between two markets, allowing a nimble player to exploit the difference. “Real arbitrage is free money,” says Andrew Biggs, a scholar at the American Enterprise Institute. “But it doesn’t hang around very long.”


Safe bonds and risky equities are not the same product, but public pension accounting currently permits state and localities to treat them as if they were.
“They are counting the return on the stocks before the return is there,” Biggs says. “If you borrowed money to invest in the real world, you would factor the current value of the debt with the current real value of the stocks.”

Given the inherent risks and possible rewards, how have POBs fared? In 2010, a research team led by Alicia Munnell, director of the Center for Retirement Research at Boston College, ran some numbers to find out. The team took 2,931 POBs issued by 236 governments through 2009. They used each bond’s repayment schedule to calculate interest and principal, and then clustered them into cohorts based on the year issued. They assumed a 65/35 investment split between equities and bonds and tracked the results with standard indexes. They then produced two composite graphs -- one at the height of the market in 2007 and the second in 2009, after a crash and before recovery.

In general, bonds issued in the early stages of a stock boom performed well prior to the crash. Thus, POBs issued in the early 1990s were healthy, ranging from 2 to 5 percent net growth. Borrowings in 2002 or 2003 also looked good.


Those issued in the latter years of the 1990s or 2000, however, were in negative territory even before the 2008 crash, having suffered serious losses to their principal in the 2001-2002 downturn. After 2008, all POBs were under water -- except those issued in the trough of the collapse, which by 2009 were already pushing 25 percent gains.

Oregon’s numbers mirror Munnell’s findings. Local government POBs issued in 2002 at the depth of that market collapse and managed by Oregon PERS gained an annual average of 8.84 percent through 2012, before principal and interest on the bond. Less lucky were bonds issued in 2005. The Springfield School District’s POB earned just 5.53 percent, for example. Since that bond carried 4.65 percent interest, it likely earned roughly one point annually -- not much, but slightly above neutral. Oregon’s 2007 issuers earned just 2 percent on their investments through 2012, and are upside down today after debt service.

The same fate befell Stockton, Calif., which also came to market in 2007. Similarly, New Jersey issued a $2.8 billion POB in 1997 -- on the wrong side of another stock bubble.

“The whole thing is the timing,” Oregon’s Cleary says. “You are trying to issue them when the market has bottomed out and when interest rates are reasonable, because really what you are doing is making an investment bet. If people thought when they did POBs that they were refinancing a debt or doing a locked-in arbitrage, rather than an investment play, I’m sure they have been very surprised by the results.”


And yet that is exactly how they were sold. When Oregon voted on new POBs in 2009, the voter education pamphlet argument in favor of issuance explicitly framed the choice as a “refinance” and cast the projected returns as money “saved.”

“Just like many homeowners are refinancing their home mortgages,” the pamphlet read, “the State should take advantage of these historically low rates, which can save Oregon more than $1 billion over the next 25 years. The money saved will help reduce cuts and protect services that all Oregonians rely on.”

Because POBs demand headroom between the interest an issuer pays to borrow and the high returns promised on resulting investments, their investment strategies tend to chafe against safer portfolios. Without a hefty “discount rate” -- as the projected annual gain assumed by a pension fund is known -- the pension bonds would not be possible.

In a 2012 paper, Andrew Biggs argues that the aggressive 8 percent discount used by many states overstates likely earnings and understates risks. A fund that required $100 million in 20 years and employed an 8 percent discount rate would be “fully funded” with $21 million, Biggs notes. But if that same fund were to gain only 5 percent annually, it would need $38 million today to be fully funded in 20 years.


Many experts argue that because public pension obligations are legally binding, pension funds should be discounted at close to zero risk on the front end -- at or near the rates offered by government bonds.
“While economists are famous for disagreeing with each other on virtually every conceivable issue,” wrote then-Federal Reserve Board Vice Chairman Donald Kohn in 2008, “when it comes to this one there is no professional disagreement: The only appropriate way to calculate the present value of a very-low-risk liability is to use a very-low-risk discount rate.”

In point of fact, the 8 percent discount rate may be on its way out. The Governmental Accounting Standards Board (GASB) is launching a complex hybrid discount standard in 2014, which will affect the assumptions states make with their funds. Some fear the GASB rule will only create more confusion. Bond rater Moody’s is taking a simpler tack in weighing government pension plans, having recently proposed to shift its pension discount rate down to the level of AA taxable bonds, which are now at 5.5 percent. “Currently, discount rates used by state and local governments are all over the place,” says Tim Blake, Moody’s managing director of public finance. “Most are in the range of 7.5 to 8 percent. We need a uniform rate.”

Not surprisingly, 5.5 percent is very close to the rate at which many POBs are sold to investors.


With aggressive 8 percent discount rates now under attack by economists, oversight boards and rating agencies, issuers who counted on rosier outcomes have learned some hard lessons. Five years ago, when Connecticut State Treasurer Denise L. Nappier announced a new $2.28 billion pension bond, she noted that the state had “achieved a favorable borrowing cost of 5.88 percent, which is well below the 8.5 percent assumed long-term return on assets of the Teachers’ Retirement Fund. This will provide significant cash flow savings over the long term and a potential savings to taxpayers of billions of dollars.”

When the bond was issued in April, the Dow Jones average stood just shy of 13,000. By November, the market was in free fall. It bottomed out the following March at just over 6,600. Connecticut’s timing could hardly have been worse. As the market plunged, Pensions & Investments lit into POBs, singling out Connecticut. The editors argued that POBs shove obligations “that should have been paid as earned” onto future generations, along with the risk of the debt.

By 2010, with the market still emerging from the trough, Connecticut’s finances were as messy as ever. But now there was little appetite for more bonds. POBs “are certainly a risky proposition,” Michael J. Cicchetti, chairman of Connecticut’s Post Employment Benefits Commission, told the CT Mirror. “Things are different now than they were then.”


______________________________________________

Wall Street has the nerve to state that public sector pensions are too big of a liability for governments.  After all, Wall Street fraud caused a loss of 1/2 pension value in 2008 and the rating corporations like Moody's was ground zero for the fraud---they should know pensions are limping along!

Indeed, simply taking the assets of the three major rating corporations and pushing them into bankruptcy for their part in the fraud would have made pensions flush with cash.  RULE OF LAW WOULD HAVE SOLVED GOVERNMENT PENSION SHORTFALLS.  No one shouted this!  Did you hear your pols shouting for recovery of pension losses from fraud to make up the shortfall?  They went straight to cutting benefits.  They through pensions into bad investments just to claim they were liabilities that needed to be cut.

THAT'S A NEO-LIBERAL FOR YOU-----WORKING TO MAXIMIZE WALL STREET PROFITS AT PUBLIC EXPENSE!

Now, why should all citizens be concerned about pension fraud ----even those with no pensions? 


THE SAME THING IS HAPPENING WITH SOCIAL SECURITY!  YOUR RETIREMENT PROGRAM IS BEING RAIDED BY THE SAME PEOPLE.  DO NOT THINK IT OK FOR SOME PEOPLE TO LOSE THEIR RETIREMENTS WHEN THE PROBLEM IS CORPORATE FRAUD AND CORRUPTION AND NOT THE BENEFIT!

So while neo-liberals like Dulaney are busy making sure legislation places corporations into positions to earn grand profits-----they are setting you and I to take the losses once again.

The policy of risk-free rating is not a bad thing-----what is bad is that it comes at a time when pensions are waiting for recovery from fraud by Moody's and it comes as the bond market is ready to implode from public sector malfeasance.  Can you imagine how impossible it will be to meet these obligations after an economic crash bigger than 2008? 

THAT'S RIGHT-----THEY DO NOT WANT TO BE ABLE TO MEET THEM!  THAT IS WHY THEY ARE IMPLODING THE BOND MARKET FOR GOODNESS SAKE!


A Maryland neo-liberal running for Governor of Maryland Heather Mizeur actually stated-------if public employees gave up pension benefits we could build all these schools in Baltimore.  That is what neo-liberals do----pit people in the same Democratic base against one another.  It is not an either/or----STOP THE CORPORATE FRAUD AND PROFITEERING!

LABOR AND JUSTICE ARE THE DEMOCRATIC BASE!

Moody’s Playing Dangerous Games With Public Pension Funds

Tuesday, 07 May 2013 09:29 By Dean Baker, Truthout | Op-Ed

The bond-rating agency Moody's made itself famous for giving subprime mortgage backed securities triple-A ratings at the peak of the housing bubble. This made it easy for investment banks like Goldman Sachs and Morgan Stanley to sell these securities all around the world. And it allowed the housing bubble to grow ever bigger and more dangerous. And we know where that has left us.

Well, Moody's is back. They announced plans to change the way they treat pension obligations in assessing state and local government debt.

Instead of accepting projections of pension fund returns based on the assets they hold, Moody's wants to use a risk-free discount rate to assess pension fund liabilities. This will make public pensions seem much worse funded than the current method.

While this might seem like a nerdy and technical point, it has very real consequences. If the Moody's methodology is accepted as the basis for accounting by state and local governments then they will suddenly need large amounts of revenue to make their pensions properly funded. This will directly pit public sector workers, who are counting on the pensions they have earned, against school children, low-income families, and others who count on state supported services.

In other words, this is exactly the sort of politics that the Wall Street and the One Percent types love. No matter which side loses, they win. While public sector workers fight the people dependent on state and local services, they get to walk off with all the money.

Wall Street is expert at these sorts of accounting tricks; it is after all what they do for a living. And this is not the first time that they have played these sorts of games to advance their agenda.

The current crisis of the Postal Service, which is looking at massive layoffs and cutbacks in delivery, is largely the result of accounting gimmicks. In 2006 Congress passed a law requiring an unprecedented level of pre-funding for retiree health care benefits. The Postal Service is not only required to build up a massive level of prefunding, it also is using more pessimistic assumptions about cost growth than any known plan in the private sector.

This requirement is the basis for the horror stories of multi-billion losses that feature prominently in news stories about the Postal Service. The Postal Service would face difficulties adjusting to rapid declines in traditional mail service in any case (it doesn't help that they are prohibited from using their enormous resources to expand into new lines of business), but this accounting maneuver is imposing an impossible burden. The change in pension fund accounting could have a comparable impact on state and local governments.

Moody's change in accounting is not just bad politics, it is horrible policy. The key question is how we should assess the returns that pension funds can anticipate on the assets they hold in the stock market. Moody's and other bond rating agencies did flunk the test horribly in the 1990s and 2000s. They assumed that the stock market would provide the historic rate of return even when price to earnings ratios were more than twice the historic average at the peak of the stock bubble.

While some of us did try to issue warnings at the time (here) and (here) the bond rating agencies were not interested. As a result, when the stock market plunged, many pensions that had previously appeared to be solidly funded, suddenly faced substantial shortfalls.

It is possible to construct a methodology that projects future returns based on current market valuations and projected profit growth that maintain proper funding levels, while minimizing the variation in contributions through time. By contrast, if the pension funds adopted the Moody's methodology as the basis for their contribution schedules, they would find themselves making very large contributions in some years followed by years in which they made little or no contribution.

A state or local government that used the Moody's methodology to guide their contributions would effectively be prefunding their pensions in the same way that it would be prefunding education to build up a huge bank account so that K-12 education was paid from the annual interest. While it would be nice to have the cost of these services fully covered for all time, no one thinks this policy makes sense. We would be hugely overtaxing current workers so that future generations could get a huge tax break.

Even worse, Moody's scoring of pensions may discourage pension managers from holding stock as an asset. They would be held accountable for any losses in bad years, but would not get credit for the higher expected returns on stock. For this reason, risk averse pension managers may decide to hold safe but low yielding bonds.

This would lead to the perverse situation in which collectively invested funds held in pensions only hold safe bonds, even though market timing carries little risk for them. On the other hand individual investors, who are hugely vulnerable to market timing, would be holding stock in their 401(k)s.

That outcome makes no sense. But of course it didn't make sense that subprime mortgage backed securities were Aaa. This is Moody's we're talking about.


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July 18th, 2014

7/18/2014

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from subprime mortgage fraud to municipal bond fraudFRO
FROM SUBPRIME MORTGAGE FRAUD TO MUNICIPAL BOND FRAUD-----NEO-LIBERALS AND NEO-CONS ARE ALL ABOUT MOVING MONEY TO THE TOP ANY WAY POSSIBLE

Let's compare again the 2008 subprime mortgage crash and the coming bond market crash to see it is neo-liberals working with neo-cons deliberately manufacturing these crashes with the goal of moving ever more public assets to the top.  Clinton's administrative team with Robert Rubin at Citigroup created the subprime mortgage plan with Greenspan and Tim Geithner and the Federal Reserve's Bernanke with Obama created this bond market crash.  Both required the neo-liberals in Congress to pass the laws allowing the conditions.

As we know the foreclosures on homes are still going strong and Maryland leads the pack.  Remember, almost none of the parking ticket of a settlement for subprime loan fraud made it to the victims of fraud---it is being sent back to the banks paying the settlement in the form of development subsidy.  So the transfer of homeownership has never stopped since we elected a super-majority of neo-liberals.  A ridiculous attempt at refinancing with a program called HARP delayed dispensing money for years and is now advertizing to help through the same mortgage lenders having committed the frauds.  Most people have of course lost their homes through yet again a fraudulent foreclosure process.  Can you imagine handing HARP to the same institutions defrauding trillions from the FHA? 

THESE CORPORATE POLS COULD CARE LESS WHAT YOU AND I THINK----THEY THINK THEY HAVE ELECTIONS CAPTURED AND WE CANNOT MAKE CHANGE!  THEY ARE WRONG!



'So, have QE and the ballooning debt been a fantastic success or a Questionably Effective policy designed to recapitalize banks and the financial elite at the expense of most others, including pension funds, retirement accounts, savers, and bond funds'?

QE is simply a policy to allow the FED to leverage debt to buy the toxic subprime loans from Wall Streets accounts making them look as though they have recapitalized.  Those trillions that the FED bought are the most toxic of subprime mortgage loans.  The second goal was lowering the interest rate for selling homes because after all Wall Street had tens of millions of foreclosed homes coming to them and they needed to sell them as cheaply as possible to maximize bank profits.  So while neo-liberals in Congress bailed out the banks---they left Main Street in mass foreclosure all designed to move these homes to Wall Street where they were bundled and resold to the same investment firms creating the mortgage frauds.  QE lowered interest rates to zero and the only ones benefitting were those banks peddling foreclosure bundles and the foreigners laundering their looted wealth from their country to US real estate.  That was the rising sales you heard on TV news.  We see it in Baltimore as developers are buying huge tracts of communities for next to nothing ----these communities being the ones devastated by the subprime loan fraud and foreclosures.  Consolidated ownership of property is good for no one.

The FED has a mission of economic stability and low unemployment and it is fraud and malfeasance when the policies they push do the opposite.  They pretended unemployment went down when it is now at 36%----they pretended they were keeping inflation low when it is at 5% ---and they certainly will not be able to claim economic stability when the market crashes in 2015 from the bond implosion. 

ALL INSTITUTIONS ASSOCIATED WITH GOVERNMENT ARE OPENLY WORKING AGAINST THE MISSION OF PROTECTING THE AMERICAN PEOPLE AND ONLY A FEW ARE BEING MADE RICH FROM THIS MALFEASANCE.

For those thinking their pensions have made gains to replace losses from 2008-----those gains are about to disappear and then some.


QE: Quantitative Easing or Questionably Effective

-- Posted Tuesday, 8 July 2014
By GE Christenson

We all know the S&P 500 Index has been on a 5+ year rally to all-time highs – thanks to ultra-low interest rates and the levitating wonder of “printing money” via QE – Quantitative Easing.  Examine the following chart of the S&P for the past 20 years.

If you were a member of the top 5 – 10% and had a large investment in the stock market, you increased your nominal net worth. However, if you were in the bottom 90%, then the wonders of QE did not “trickle down” to you and your family, except as higher prices.

Pension and retirement funds benefitted to the extent of their stock investments but they were hurt by generational low interest rates in their bond portfolios.  Simply put, the stock market rally benefitted a narrow band of society – mostly the political and financial elite and upper middle class.

But how does the massive rally in the S&P look when priced in barrels of crude oil?  Examine the following chart of weekly S&P divided by weekly Crude Oil prices – both smoothed with a 52 week moving average.


That rally in the S&P, when priced in barrels of crude oil, does not look nearly as impressive.  Remember – a small percentage of people benefit from higher stock prices, but everyone pays when oil prices rise.  The price of crude oil affects food prices, gasoline prices, shipping costs, home heating costs, mining and manufacturing costs, and so many more. 

When we look at the S&P in terms of crude oil, we see:

1)    The ratio is DOWN over 75% from its peak.

2)    The ratio has been essentially unchanged since 2006.

3)    The price of crude has risen for the last 14 years - much more rapidly than the S&P, along with a massive increase in debt and the money supply.

4)    A few people benefitted from the nominal rise in the S&P and most people were hurt by the rising costs of energy, gasoline, manufacturing, food, and so on.

5)    The overall US economy seems to be sputtering, unless you believe what financial television is “selling.”

So, have QE and the ballooning debt been a fantastic success or a Questionably Effective policy designed to recapitalize banks and the financial elite at the expense of most others, including pension funds, retirement accounts, savers, and bond funds?

QE looks like it produced a toxic cloud of dangerous mal-investment, debt and currency bubbles, higher consumer prices, and a weakened economy. 

___________________________

The FED was busy taking trillions of subprime mortage loans off banks accounts leaving the FED leveraged to the max right before this coming bond crash.  What happened when the insurance corporation AIG was tethered to this same fraud?  Taxpayers paid the debt and indeed the FED's debt will be handed to taxpayers with this coming bond crash.

The other stash for toxic loans was Freddie and Fannie and rather than making banks write off those fraudulent loans to clear the debt on these public/private entities-----Obama and neo-liberals are embracing the debt as public debt and taxpayers are paying off yet another trillion in fraudulent loans there.

Friday, September 14, 2012
 
QE Infinity: Fed Buying More Toxic Assets From Banks Will NOT Help Main Street Dees Illustration

Eric Blair
Activist Post

Ben Bernanke and the Federal Reserve announced an open-ended bailout for the banks yesterday by a new mechanism called QE Infinity where they plan to purchase $40 billion of toxic mortgage-backed securities per month "until further notice".

Shrouded in confusing language like "unlimited stimulus" or "quantitative easing", this unprecedented move and rule change by the Fed was said to be warranted because employment remains weak even though they still maintain the false notion that "economic activity has continued to expand at a moderate pace in recent months."

As stated in the FMOC press release:
If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy tools as appropriate until such improvement is achieved in a context of price stability. Of course this move "to foster maximum employment and price stability" does nothing to directly help job creation, and will continue to hurt main street by inflating the price of everything purchased by dollars. Yet it will clearly reward the investor class who already own most of the dollar-based assets.

The theory is that by removing toxic assets from the bank's books they have more liquidity to offer more credit, or to purchase more government debt. Somehow this is supposed to trickle down and help improve unemployment, which real numbers show to be in the 20% range when all factors are considered.

After a combined $2.3 trillion from
QE1 ($1.7T) and QE2 ($600B), plus over $16 trillion is secret bailouts to recapitalize banks with absolutely no measurable improvement in the economy, how could any thinking person believe this policy will be beneficial?


Since mortgage-based assets total a conservative $600 TRILLION, QE Infinity is nothing more than an endless giveaway to the criminal banks at the expense of struggling taxpayers. Wall Street will obviously celebrate the move and stock prices will go up, along with food and energy prices.

It is so blatantly a policy that will steal from the poor to give to the rich.  It also makes one wonder how can the government cry poor when it comes to paying for food stamps, healthcare, education, and other benefits for the needy when they have endless trillions to prop up the banksters?

Significantly, this announcement comes on the heels of a census report that shows median incomes have fallen to levels of the
late 1960s and early '70s. Of course, the mainstream version is they've only fallen to 1989 levels, which is hardly any better.

ShadowStats.com
The census report showed that the middle class is struggling with a median family income of $50,054. In 2010, Michael Snyder decisively proved that it is flat impossible for a family of four to survive on this income in America, and prices for essentials have only increased over the last two years primarily because of the Fed's reckless money printing.

This policy is an absolute disgrace and represents the final looting of the American people. There will simply be nothing left to the value of the dollar, and all of the important assets will be funneled straight up to the elite banksters.

You think you are slaves now?  Just wait.

______________________________

JUST WAIT says the article above.  Below you see how Obama and neo-liberals in Congress passed the laws creating the conditions for this bond bubble knowing a crash would hit Federal, state, and local governments the hardest.  As I question Maryland politicians about these bond leverage deals that place the taxpayer in charge of debt for decades and telling them the bond market is getting ready to crash----they tell me----OH, THAT WON'T EFFECT A PLAIN VANILLA BOND DEAL LIKE THIS!  Plain vanilla bond deal?  When Obama and Congress created terms for bonds that made the world want to buy them the bond bubble soared.  Then, the FED QE made them soar.  Remember, when the subprime loan crash came we found all of Wall Street investors in these loans had Credit Default Swaps-----insurance against losses ----with AIG being the corporation served up in sacrifice for the fraud.  These toxic policies were insured for 100% on the dollar and Obama and Geithner made sure that 100% was paid by taxpayer bailout.

Below you see the same thing happening.  The boom market now in insurance is Bond Insurance.  We see this corporations looking to be the AIG of this bond fraud as it insures bond deals against losses at 100%.  We all know the crash is coming so why are these insurance deals happening?  Taxpayers will come in to bailout this insurance corporation when the bond crash occurs. 

As you see Moody's and the other rating corporations are still in the game rating these bonds and the insurance no doubt AAA as it does Maryland and its financial picture. 


THIS ENTIRE BUSINESS DEVELOPED IN RESPONSE TO THE POLICIES IMPLEMENTED BY OBAMA, CONGRESS, AND THE FED.  IT IS THERE SIMPLY TO ALLOW THESE BANKS TO CREATE BOOM AND BUST WITH NO LOSSES FOR THE PEOPLE DOING IT.


Answers to Questions about the Novation of CIFG Assurance North America, Inc. Municipal Bond Insurance Policies to Assured Guaranty Corp.
 
December 12, 2011

In January 2009, CIFG Assurance North America, Inc. (CIFG) and Assured Guaranty Corp. (AGC) entered into a reinsurance transaction whereby AGC provides reinsurance to CIFG with respect to certain U.S. public finance and infrastructure bond insurance policies (the "covered policies").  CIFG and AGC also agreed that they would use commercially reasonable efforts to novate the covered policies to AGC.  CIFG has begun sending requests to the issuers of insured obligations (or to the applicable trustee of the bondholders) seeking consents for the novation of the covered policies. 

The novation is being implemented in two phases.  In the first phase, consents are being solicited for bonds insured in the primary market.  Bonds insured in CIFG’s secondary market custodial receipt program will be solicited in the second phase.
To the extent regulatory filings or approvals are required in connection with the novation of any policy, requests for consent will only be sent after any applicable waiting periods have elapsed or any required approvals have been obtained.

What are the benefits of novation?

Novation gives bondholders the direct protection of AGC’s claims-paying resources.  Once a municipal bond insurance policy has been novated,
AGC will request, and expects to obtain, an AGC insured rating from S&P, Moody’s or both depending on which originally provided a CIFG insured rating for the related bonds.  Although AGC already provides 100% reinsurance for the covered policies and administers the policies on behalf of CIFG, CIFG remains the insurer until the policies are novated, and the bondholder remains subject to credit risk of CIFG.

As a bondholder, do I need to take any action for the bond insurance policies to be novated?

In general, bondholders are not being asked to take any action at this time.  If there is a trustee for an issue insured by CIFG at origination, the trustee has been asked to execute a consent to the novation.  If there is no trustee (as is true for many municipal general obligations that utilize a paying agent), then the issuer has been asked to execute such consent.  If an insurance policy was written by CIFG after the bonds began trading in the secondary market, the custodian bank holding the custodial receipt that associates the policy with the insured bonds will be asked to execute the consent. Bondholders may be contacted directly by the applicable trustee, issuer VIEW LIST OF COVERED POLICIESor custodian bank as part of the consent process.

The offer to novate a particular municipal bond insurance policy will be open through the date specified in the offer unless such date is extended or the solicitation is earlier terminated at the sole discretion of CIFG and AGC.   Bondholders should contact the trustee, issuer or custodian to inquire about the status of the request and whether any action has been taken.  Bondholders are also encouraged to send their contact information, together with the name of the issuer, CUSIP number, original par, series and other identifying information concerning the insured bonds, to CIFG at novationteam@cifg.com in order to facilitate the novation process.

How will I know if the insurance policy has been novated? 

Novated policies will be identified in a list of covered policies maintained on this page of the Assured Guaranty website, which may be reached at www.assuredguaranty.com/novation.  Additionally, once S&P and Moody’s have issued new insured ratings for a given issue, those ratings should be reflected on data services such as Bloomberg.

VIEW LIST OF COVERED POLICIES
What happens to the insurance policy when novation takes place?

All of the terms and conditions of the policy will remain unchanged, except that AGC will be the insurer in full substitution for CIFG and, because of that substitution, AGC will have all of the rights and obligations of CIFG under the policy and related documents and CIFG will be fully released of its obligations under the terms of the policy. The consent form signed by AGC and the issuer, trustee or custodian, as the case may be, and a notice of effective date issued by AGC following receipt of the signed consent form will become part of the policy.

Will all the municipal bond insurance policies be novated at the same time?

No.  Except as described below, the effective date for each policy’s novation is the date on which CIFG receives an executed consent form for that policy.

If CIFG issued a debt service reserve fund surety bond or a swap insurance policy in connection with my CIFG-insured bonds, will that be novated, too?

Separate consent requests are being sent to issuers, trustees or swap counterparties, as appropriate, for each debt service reserve fund surety bond and swap insurance policy.  In cases where a debt service reserve fund surety bond or a swap insurance policy was issued in connection with a bond insurance policy or policies, CIFG must receive the executed consent forms for each bond insurance policy, debt service reserve fund surety bond and swap insurance policy, as applicable, before the novation of such policies and surety bond shall become effective.  (Where there is no debt service reserve fund surety bond or swap insurance policy, multiple bond insurance policies issued in connection with a single bond transaction may be novated independently.)

________________________________________________

Do you see anything below that leads you to believe the FED is acting in the public interest?  It is Obama and Congress that appoints these FED chairs.  DO YOU HEAR YOUR POLS SHOUTING THE FED IS ACTING CRIMINALLY?

If you do not hear your pols shouting about this rogue FED policy they are neo-liberals working for wealth and profit ----NOT DEMOCRATS FOR GOODNESS SAKE.  GET RID OF THEM!


Mission
The Federal Reserve System is the central bank of the United States. It was founded by Congress in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system. Over the years, its role in banking and the economy has expanded. Today, the Federal Reserve's duties fall into four general areas:

  • conducting the nation's monetary policy by influencing the monetary and credit conditions in the economy in pursuit of maximum employment, stable prices, and moderate long-term interest rates
  • supervising and regulating banking institutions to ensure the safety and soundness of the nation's banking and financial system and to protect the credit rights of consumers
  • maintaining the stability of the financial system and containing systemic risk that may arise in financial markets
  • providing financial services to depository institutions, the U.S. government, and foreign official institutions, including playing a major role in operating the nation's payments system

Is the Federal Reserve accountable to anyone?
 
The Federal Reserve is accountable to the public and the U.S. Congress. The Fed has long viewed transparency as a fundamental principle of central banking that supports accountability. In the area of monetary policy, the Federal Reserve reports
twice annually on its plans for monetary policy. In addition, the Chairman and other Federal Reserve officials often testify before the Congress. To further foster transparency and accountability in monetary policy, the Federal Open Market Committee publishes a statement immediately following every FOMC meeting that describes the Committee's views regarding the economic outlook, and provides a rationale for its policy decision. Full minutes for each meeting are published three weeks after each FOMC meeting. Full verbatim transcripts of the FOMC meetings are made available with a five-year lag. Further, the Federal Reserve Chairman holds press conferences after selected FOMC meetings to discuss the monetary policy outlook.

The Federal Reserve is transparent and accountable in its other functions as well. The Board of Governors prepares an
Annual Report summarizing activities of the Board and all Reserve Banks; the annual report is delivered to the Congress. To ensure financial accountability, the financial statements of the Federal Reserve Banks and the Board of Governors are audited annually by an independent outside auditor. In addition, the Government Accountability Office, as well as the Board's Office of Inspector General, frequently audit many Federal Reserve activities. Weekly, the Board of Governors publishes the Federal Reserve's balance sheet. During the recent financial crisis, the Federal Reserve provided information about its lending programs on its public website and in a special monthly report to Congress.







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July 03rd, 2014

7/3/2014

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THESE ARE NEO-CON AND NEO-LIBERAL POLICIES SO TO ESCAPE BAD POLICY---DO NOT SIMPLY VOTE THE OTHER PARTY-----CLEAN UP THE DEMOCRATIC PARTY!

Maryland's Governor Martin O'Malley announced that shortfalls in the 2014 state budget due to a complete stagnation of Maryland's economy and high unemployment  created by control of Maryland's economy by global corporations will focus on programs and services valuable to the citizens of Maryland but not affect the massive giveaway of revenue in the guise of corporate subsidy, tax breaks, or any effort to reign in billions of dollars in corporate fraud. 

O'Malley as a neo-liberal calls this FISCAL RESPONSIBILITY


So, $10 million will be taken from higher education and that includes grants, financial aid, and scholarships to Maryland citizens and employment to 4 public universities essential to middle-class/working class/poor families.

Below you see how a neo-liberals systematically eliminate all public sector employment by saying it is not firing anyone but eliminating positions not filled.  Maryland has had its entire oversight and accountability sectors eliminated in this way.  What I want to focus on today is higher education and the outsourcing of public university jobs to such an extent that the state spends money to support an education system that does not even operate in the US or benefit the citizens of Maryland.  O'Malley spent his 8 years developing the structures for overseas education and made marketing and recruiting foreign students a priority.  This is where our higher education money is spent and media states that never has there been fewer citizens of Maryland unable to attend Maryland universities.  It is not only high tuition----it is the elimination of financial aid, grants, and scholarships.  It hurts the economy in that people are not hired to these state positions to earn the money needed for consumption of goods and this creates a stagnant economy.  O'Malley does this because he works for global corporations that want all state and local revenue spent expanding their businesses overseas,  promoting exports, and bringing foreign students to Maryland to graduate and be sent back overseas to work for US global corporations in other nations.  This entire process leaves out the families in Maryland and their children's ability to attend the best public universities in the state.  Don't worry.....O'Malley and neo-liberals spent hundreds of millions building a separate system of higher education for the citizens of Maryland that cheapen and track all into vocational training programs.  This also increases the number of foreign graduates that are not citizens ready to take high level jobs thanks to Obama's executive order to allow the high-skilled green card worker quotas to rise.  So, Maryland citizens are not able to access the higher education venues that lead to the best jobs.  When people who are not citizens are given these jobs they have no workplace rights and are not free to report abuse or illegal activity within the corporations for which they work.  In these times of systemic corporate fraud and corruption----this is critical.

So, an election year budget that protected labor positions is followed by budget cuts eliminating jobs right after the primary for Governor of Maryland.  Union leaders knew this would happen-----it happens all the time.  Neo-cons would be worse.
  Neo-liberals only pretend to be progressive labor and justice!

Remember, I have for years been explaining that the state was giving a rosy economic picture that was not real and I stated why the economy was indeed stagnant and unemployment high.  Below you see Franchot being the spoiler but the Comptroller's Office is ground zero for corporate tax fraud and the wrongful designation of corporations as non-profits and therefor losses in the hundreds of millions in state tax revenue each year which would happen with a republican in office as well.


State approves O'Malley's $84 million in budget cuts Poor economy prompts spending reductions


By Erin Cox, The Baltimore Sun 1:19 p.m. EDT, July 2, 2014



The lackluster economy prompted Gov. Martin O'Malley to propose erasing $84 million in planned spending for next year.

Just a day after the new state budget took effect, O'Malley persuaded the Board of Public Works unanimously to approve a modest set of cuts to Maryland's $16.1 billion general fund.

About $10 million in cuts come from the state's higher-education institutions, although O'Malley aides said it would not affect tuition rates.

The cuts would not cause any layoffs but would trim 61 vacant jobs from the state's workforce of about 80,000 people, aides said. More than half of those jobs will come from higher education, including 36 vacant posts in the University of Maryland system.

Even though the official estimate of how far revenue lags behind state spending will not be ready until September, the administration chose to begin budget cuts now — before agencies started spending this year's cash. Together, the cuts represent less than half a percent of the state's general fund.

O'Malley said that the cuts "build upon a tradition, a culture of fiscal responsibility." He pointed out the belt-tightening was much smaller than cuts the state took during the recession.

Comptroller Peter A. Franchot voted for the cuts, but said that state leaders need to drop the "political spin" about the state's improving economy and "stop pretending that we made it through the thicket."

"Our citizens don't want to hear the spin anymore, and they're not falling for it," Franchot said.

A federal economic report released last week showed that the U.S. economy contracted more during the first quarter of 2014 than in any quarter during the previous five years. That followed another U.S. Department of Commerce report showing that Maryland's economy had stagnated in 2013.

The sluggish growth means state revenues have fallen lower than officials estimated earlier this year.

O'Malley defended the state's financial health by citing its AAA bond rating and comparing Maryland's relatively small budget shortfall to larger looming problems in other states on the Eastern seaboard, some of which have shortfalls in the hundreds of millions.

"We are coming through this recession faster than a lot of other states," O'Malley said. He added, "there's a lot that is going right, and of course, still, a lot of work to do. In that spirit, I agree with the comptroller that we should have an honest conversation."

In January, O'Malley proposed a $39 billion state budget that increased spending by 4.9 percent and took effect Tuesday, the final state spending plan of his eight years in office.

T. Eloise Foster, O'Malley's budget secretary, said Wednesday's cuts are designed to resolve the shortfall for the entire year. "My plan is not having to do this again," she said.

While O'Malley's staff declined to offer a list of all the $84 million in specific cuts, they said they include $56 million to various government agencies, with some asked to eliminate vacant jobs, forgo software upgrades or pare back other expenses.

In addition to the $10 million cut from higher education, another $10 million will be shaved from the state budget by spending federal cash already in state coffers. And budget experts said they expect $7 million of anticipated expenses to not materialize.

The cuts would not affect the struggling Maryland Health Benefit Exchange insurance website or a series of new economic development programs to expand cybersecurity and biotechnology sectors in Maryland.

All cuts must be approved by at least two members on the state's three-person Board of Public Works, on which O'Malley, Franchot and State Treasurer Nancy K. Kopp sit.

The cuts pale in comparison to the big spending reductions the board approved during the recession. In 2010, O'Malley went to the board three times for a total of $614 million in spending cuts from the general fund. In 2009, he asked for a total of $429 million in cuts over three requests. And in 2008, O'Malley requested a single $213 million spending cut.

_________________________________________________

Below you see where all the money for higher education has gone during the neo-liberal O'Malley's terms in office-----building this network of global PhDs and it has nothing to do with the citizens of Maryland!  This is what the US Senate based their immigration reform bill ------the bringing of foreign students and grads to America and then allowing them to take these US corporate positions often the best positions.  We are not anti-immigrant nor do we want to exclude foreign students from our universities-----quite the opposite, this should be robust.  We are against the simultaneous defunding of higher education for the bulk of Maryland citizens and it is deliberate.

WE CAN FUND HIGHER EDUCATION FOR ALL THAT WANT TO ATTEND OUR MARYLAND UNIVERSITIES BY ENDING CORPORATE SUBSIDIES AND TAX BREAKS AND FOR GOODNESS SAKE MASSIVE CORPORATE FRAUD.

All this is happening because of global corporate control of the Maryland economy.  We do not need these global connections for a healthy economy------it does just the opposite----it stagnates the economy.

The Global Ph.D.
July 3, 2014 By Holly Else
for Times Higher Education



Internationalizing the doctoral training process could help to overcome negative perceptions about the employability of Ph.D. students outside academia, said participants at a recent conference.

Universities in several countries are beginning to think of new ways to cater for the rising number of overseas doctoral students, speakers at the European University Association’s annual meeting on doctoral education told delegates in Liverpool.

International doctoral students offer a “cost-effective” way for institutions to build international links. But problems surrounding complex visa rules, falling domestic student numbers and the cost of running international joint doctoral programs remain.


The number of domestic doctoral candidates at Australia’s University of Queensland started dwindling in 2008, according to the head of its graduate school, Alastair McEwan. To compensate, the university has enrolled international students, who now make up about 40 percent of the doctoral student body.

The shift is “most dramatic” in engineering, architecture and IT, where departments are “heavily reliant” on overseas students, he said. He added that the university is investing in this area because Ph.D. students “are absolutely critical” to research output and are “a very cost-effective way to promote international linkages.”

McEwan said that the benefits international doctoral candidates bring to the institution “cannot be overestimated”. Their presence offers students a “breadth of knowledge about other cultures.”

“That is an important transferable skill that should be part of a student’s employability development. Internationalization of the Ph.D., or international interactions, could help us overcome some of the negative perceptions about the employability of Ph.D. students outside academia,” he added.

But he said that having overseas students enrolled on doctoral programs was a one-dimensional method of internationalization. “The next stage is to start thinking about other ways,” he said, adding that the answer did not lie in Ph.D.s that are run jointly with overseas institutions.

“These come with a high overhead as they are very hard to manage.... I’m not convinced that this is the most efficient or effective way to manage things in the long run,” he added.


American institutions are also seeing a rise in the number of overseas doctoral candidates in science, technology and engineering subjects. The vice provost and dean of Cornell University, Barbara Knuth, said: “We should be concerned in the U.S. in terms of [what] our doctoral pool will be for economic development purposes.”

She said that the nation’s immigration policies are “complex and quite limiting.”

“Doctoral students are eager to come to the U.S. to study, but we are not very good at encouraging them to stay after their degrees,” she added.

Cornell is now working to internationalize the doctoral experience for all students. Internationalizing the Ph.D. process would help to expand a graduate’s professional networks and employability, she said.

At the institutional level, it will broaden intellectual discoveries, help academics to address complex global problems and increase the visibility and exposure of the institution globally, she said.

Jean Chambaz, president of the University of Pierre and Marie Curie in France, said that universities needed to move beyond memoranda of understanding when it comes to working together internationally.

“We need focused, balanced programs on questions of common interest that include multilateral doctoral candidates and staff circulation,” he told delegates.


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Below you see why more and more staff are being cut from our public universities-----all the jobs are being outsourced to global corporations that are doing the work overseas that people right here in Maryland should be doing and these citizens of Maryland would do a better job.  It is done simply to reduce labor costs as pay is lower overseas and we wouldn't want all of those pesky public sector benefits providing the citizens of Maryland a first world quality of life say neo-liberals.


Is a global corporation needed to process college applications charging fees for doing so -----money which could hire a local person with a public university to do this job?  We all know massive corporate fraud is infused in all these business arrangements so universities are losing far more money by outsourcing these jobs than saving.  So, fighting fraud in court is worth eliminating staff at a university who could be held accountable to do the work right?

THAT'S A NEO-LIBERAL FOR YOU---WORKING FOR
WEALTH AND PROFIT SENDING ALL PUBLIC ASSETS TO CORPORATIONS WHILE IMPOVERISHING THE CITIZENS OF AMERICA.


IT IS ABSOLUTELY ABSURD THAT AN EDUCATIONAL INSTITUTION IS INVOLVED IN ALL THIS INTRIGUE------JUST EDUCATE THE US CITIZENS!


Troubles at Embark

July 3, 2014 By Ry Rivard  Inside Higher Education

Embark, whose software helps colleges to process online applications, has owed graduate and professional schools millions of dollars and misled university officials about why it wasn’t quickly paying up, a former executive of the company is alleging amid an ongoing legal dispute.

In June 2013, Embark owed its clients $4.7 million from student application fees it collected, according to a filing in New York state court by lawyers for Raza Khan, a former chief technology officer and board member at Embark.

Even though payments were supposed to be made in a matter of months, $1.2 million of that had been owed to colleges for more than a year, according to a spreadsheet filed last month that is said to reflect the company’s bookkeeping as of late June 2013.

Khan, who left the company around the same time, alleges company officials improperly spent money owed to colleges in order to deal with Embark’s “cash flow problems.” The money was supposed to go to colleges directly and quickly, but, according to Khan, Embark officials intentionally delayed paying back colleges and “concocted” false stories to cover up the true reason for the delays.

Embark processes admissions applications for colleges across the world, including elite graduate programs. Colleges pay Embark for its services, but Embark is obligated to pay the institutions all or most of the application fees it collects. Khan’s allegations center on Embark’s failure to give colleges their share of those student application fees.

Embark got a judge to partially seal the documents, but they were available on the court’s website for several days last month.  The company’s lawyer declined repeated requests for comment on the merits of Khan’s claims.

Khan is engaged in a bitter legal fight with his former business partner and high school classmate, Vishal Garg.

In June 2013, Embark owed its clients $4.7 million, including student fees collected as far back as 2009, according to Khan’s filing.

The largest single unpaid amount is over $1 million, which Embark is said to owe to Mount Sinai School of Medicine.

Sid Dinsay, a spokesman for the medical school in New York City, declined to comment.

When colleges asked for their money, the company sometimes “concocted” reasons that its payments were delayed, according to Khan’s filing.

In a September 2011 email also contained in Khan’s filing, Blake Avalone, then director of client relations, told another Embark official to use a “canned response” to hold off a college that was asking for money dating to the beginning of that year. The response Avalone approved blamed a “credit card processor” for the delay. Khan said in his filing that this was among the “false explanations” Embark gave colleges for payment delays.

Another Embark employee in the same email thread suggests that the email “be sent from ‘Accounting’ if that helps.” In an email chat included in the court filing, the same employee also said, “if we're going to lie, the vaguer the better no.”

Avalone, now Embark’s managing director, did not respond to multiple emails seeking comment. Emails and voicemails were not returned by anyone at Embark over the past two weeks.

Several universities, including the University of Michigan and at least one graduate program at Harvard University, have threatened legal action against Embark. Officials at both those institutions said they were paid by Embark after they made those threats.

At least one other university has recently complained to Embark. The University of California at Davis hired a lawyer to help it collect money it says Embark has owed since spring 2012, according to a letter released by the university.  In mid-May of this year, the university’s lawyer demanded that Embark pay $38,589 by June 15. That didn’t happen.

“No money was received – only a promise from the [Embark] president to follow up,” a UC Davis spokeswoman said in an email last month.

Other universities are being paid back, if only gradually.

A spokesman for Thunderbird School of Global Management said last month Embark still owes it $71,000. The school ended its relationship with Embark last fall for other reasons, the spokesman said. Khan’s filings suggest the school was owed $215,000 at one point. Thunderbird could not confirm that figure.

As of last summer, Rutgers University’s business school was owed $261,000 for fees dating as far back as April 2011, according to Khan’s filing. Much of that has been paid, the university said last month.


“Since the beginning of 2014, Embark has paid $229,260 to the Rutgers Business School – Newark and New Brunswick,” a Rutgers spokesman said in an email. “The school continues to work with Embark to collect the remaining balance.”

It’s not clear exactly how precise the spreadsheet is in Khan’s filing: It says Georgia State University is owed $81,000 for fees it collecting in 2010 and 2011, though a Georgia State official said that Embark paid it $80,000 several years ago for work done in 2009 and no longer owes the university money. UC Davis, on the other hand, is asking for more money than the spreadsheet shows it is owed.

Khan first made allegations about Embark’s repayments to colleges in July 2013, when he sued his business partner Garg. But Khan provided more details about Embark’s business last month in a separate case in which Embark is suing him.

Garg and Khan founded MyRichUncle, an upstart student loan company that made its name lending directly to students before its parent company, MRU Holdings, went bankrupt in 2009. MyRichUncle was well-known in higher ed circles in the mid-2000s for its aggressive marketing that accused college financial aid officers of engaging in “kickbacks.”

Before the bankruptcy, MRU quietly bought Embark from the Princeton Review in 2007, vowing to invigorate a company that had seen its value and reach tumble during the six years Princeton Review owned it.

Khan’s filing suggests he and Garg were unable to do so. Now, Garg’s wife, Sarita James, is president of Embark. James did not respond to multiple emails over the past two weeks seeking comment.

Khan claims Garg and others at Embark “circulated false financials” to the company’s clients and delayed payments to them because of cash flow problems.

Sometimes, even after threatening legal action, a client would stick with Embark.

In February 2013, a graduate program within Harvard Law School asked Embark for $120,000 owed to it since November and December 2012.

“Despite the promise of wire transfers by Embark (supposedly made on Feb. 1 initially and then again on Feb. 20), and despite our request for actual confirmation of the transfers, we have not received anything, not even evidence that any of the wire transfers were actually made,” Harvard assistant dean Jeanne Tai wrote in a February 2013 email, which appeared in the court filing. Harvard is not a party to the litigation.

Reached last month by phone, Tai said everything had since been squared away.

“They have since made good on everything they owed and since that period of time, we haven’t had any trouble getting what they owed us,” she said.

The Harvard graduate program remains a client.

Khan’s filing said even though Embark knew that it owed money to colleges, Garg, the former head of the company, “did not intend to cause Embark to pay such amounts owed unless and until the schools complained.”

Officials at several other institutions said to be owed money declined to comment in detail or did not return calls seeking comment about their relationship with Embark.

After the MRU bankruptcy filing, Khan and Garg quickly started another company, Education Investment and Finance Corporation, or EIFC, which manages and services private student loans and mortgage-backed securities.
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Bill and Hillary Clinton are the face of these global corporations and neo-liberalism.  They plan to win the White House in 2016 and are getting Hillary into all venues they had a hand in destroying.  High tuition and devastating student loan debt happened because the Clintons started the corporatization of US universities with the goal of creating US global corporate universities.  Bill and Hillary are the face of the 2008 economic crash that has left millions of US college grads without employment----they created these Wall Street banks by deregulating the financial industry and breaking Glass Steagall so these banks could grow to the global corporations knowing they would control the US government and economy.

PLEASE DO NOT ALLOW HILLARY AND NEO-LIBERALS TO TAKE CONTROL OF DEMOCRATIC PARTY CAMPAIGNING----RUN AND VOTE FOR LABOR AND JUSTICE CANDIDATES AGAINST ALL NEO-LIBERALS IN DEMOCRATIC PRIMARIES.  You can see why, here in Maryland it was critical for Anthony Brown to win-----heaven forbid the candidate wanting to dismantle all of this corporate structure win!


The Clinton's funded Anthony Brown's campaign because he will embrace this global corporate structure as O'Malley did and the marginalization of the citizens of America.
  The Clinton Foundation is a global corporate development institution so all that money she is making will be tax-free.

Scrutiny for Hillary Clinton Speaking Fees at Colleges

July 3, 2014

Inside Higher Ed

At least eight universities have paid hundreds of thousands of dollars to Hillary Clinton to speak on their campuses, The Washington Post reported. Students at the University of Nevada at Las Vegas, where she is due to be paid $225,000 to speak in the fall, have protested, and that is drawing attention to the likely presidential candidate's high fees, not all of which have been previously disclosed. Some of the payments ($200,000 is believed to be standard) have gone not to Clinton personally, but the Bill, Hillary and Chelsea Clinton Foundation.

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Here in Maryland, Baltimore is ground zero for the dismantling of public education from K-college.  Johns Hopkins is the driver of this policy.  They have a corporation that works to recruit overseas education labor and bring them to America to work in K-12 and in universities and colleges.  Why bring immigrant labor to teach in US schools when we have huge unemployment and plenty of teachers?  Well, Race to the Top and all of the teacher accountability that has nothing to do with quality education but everything to do with chasing current teachers out of a hostile system----- will need people to replace the US teachers that leave out of frustration and the fact that no one will want to be exposed to these kinds of working conditions.  There comes the need for foreign workers taking jobs in public schools.

Remember, the goal with K-12 is to have online classes that only need a person like an education tech in the classroom to facilitate an online presentation of material.  That education tech does not need to be a real teacher-----they only need to know how to start the online lessons and administer the tests.  So, neo-liberals have as a goal of completely dismantling our entire public education system and quality democratic education.  Think the absolutely botched rollout of Race to the Top is an accident?  This policy has been in the making since the beginning of the Bush Administration----it is a republican policy written by US corporations a decade ago----it is no accident that teachers are being subjected to the worst of conditions in this education reform rollout----neo-liberals hate labor and unions and want to get rid of public sector unions through privatization with national charter chains and global corporations specializing in education temps.


I cannot tell you how revolting it is that America is behind all of this labor abuse and it is neo-liberals controlling the people's Democratic Party leading this.

Neo-cons write the policy and neo-liberals run as Democrats to implement these policies that kill the labor that votes for them.

Monday, May 26, 2014, 1:00 pm

Trafficked Teachers: Neoliberalism’s Latest Labor Source

BY George Joseph Working In These Times


Recruiting companies in the U.S. are attracting some of Philippines' best teachers with one-year guest worker visas to teach in American public schools, saddling the teachers with hidden fees and furthering the Philippines' growing teacher shortage. (SuSanA Secretariat/ Flickr / Creative Commons)  

Between 2007 and 2009, 350 Filipino teachers arrived in Louisiana, excited for the opportunity to teach math and science in public schools throughout the state. They’d been recruited through a company called Universal Placement International Inc., which professes on its website to “successfully place teachers in different schools thru out [sic] the United States.” As a lawsuit later revealed, however, their journey through the American public school system was fraught with abuse. 

According to court documents, Lourdes Navarro, chief recruiter and head of Universal Placement, made applicants pay a whopping $12,550 in interview and “processing fees” before they’d even left the Philippines. But the exploitation didn’t stop there. After the teachers landed in LAX, they were required to sign contracts paying back 10 percent of their first and second years’’ salaries; those who refused were threatened with instant deportation.

“We were herded into a path, a slowly constricting path,” said Ingrid Cruz, one of the teachers, during the trial, “where the moment you feel the suspicion that something is not right, you're already way past the point of no return." Eventually, a Los Angeles jury awarded the teachers $4.5 million.

Similar horror stories have abounded across the country for years. Starting in 2001, the private contractor Omni Consortium promised 273 Filipino teachers jobs within the Houston, Texas school district—in reality, there were only 100 spots open. Once they arrived, the teachers were crammed into groups of 10 to 15 in unfinished housing properties. Omni Consortium kept all their documents, did not allow them their own transportation, and threatened them with deportation if they complained about their unemployment status or looked for another job. 

And it’s not always recruiting agencies that are at fault. According to an American Federation Teachers report, in 2009, Florida Atlantic University imported 16 Indian math and science teachers for the St. Lucie County School District. Labeling the immigrant teachers as “interns,” the district only spent $18,000 for each of their yearly salaries—well below a regular teacher’s rate. But because the district paid the wages to Florida Atlantic University, rather than the teachers themselves, the university pocketed most of the money, giving the teachers a mere $5,000 each.

Researchers estimate that anywhere from 14,000 to 20,000 teachers, imported on temporary guest worker visas, teach in American public schools nationwide. Such hiring practices are often framed as cultural exchange programs, but as Timothy Noah of the New Republic points out—in this case about Maryland’s Prince George County—“When 10 percent of a school district’s teachers are foreign migrants, that isn’t cultural exchange. It’s sweatshop labor—and a depressing indicator of how low a priority public education has become.”

A manufactured problem School districts frequently justify hiring lower-paid immigrants by pointing to teacher shortages in chronically underfunded rural and urban school districts. And it’s true: In poorer areas, classrooms are often overcrowded and understaffed. But this dearth of instructors did not come out of nowhere. Rather, it is an inevitable result of the austerity measures pushed through on a federal, state, and local level after the panic of the 2007 financial crisis.

As the Center on Budget and Policy Priorities notes, between 2008 and 2011, school districts nationwide slashed 278,000 jobs. This bleeding has not stopped: According to the Center on Education Policy, almost 84 percent of school districts in the 2011-2012 school year expected budget shortfalls, and 60 percent planned to cut staff to make up deficits.

Thus, we see a familiar pattern of neoliberal “restructuring” in American school systems: Cut public institutions to the bone, leave them to fail without adequate resources, then claim the mantle of “reform” while rebuilding the institutions with an eye towards privatization.   

In many cities, newly laid-off instructors are left to languish while their former employers employ underpaid replacements to fill the gaps. For example, the Baltimore City Public Schools district has imported more than 600 Filipino teachers; meanwhile, 100 certified local teachers make up the “surplus” workforce, serving as substitutes and co-teachers when they can. 

The manufactured labor scarcity narrative, used to justify the importation of guest worker teachers, provides districts with the opportunity to employ less costly, at-will employees, whose precarious legal status is often exploited. Such moves to pump up the workforce with workers—not here long enough to invest themselves in organizing or bargaining struggles—also serve to weaken shop-site solidarity and unions’ ability to mobilize on a larger scale.

The recruiting contactors’ advertisements to districts are particularly instructive in this regard, noting their recruits’ inability to qualify for benefits and pension contributions. In an extensive study, education professors Sue Books and Rian de Villiers found that recruiting firms tend to appeal to districts on the basis of cost-saving, rather than classroom quality. As one Georgia contractor, Global Teachers Research and Resources, advertises, “school systems pay an administrative fee [to GTRR] that is generally less than the cost of [teacher] benefits. Collaborating with GTRR means quality teachers with savings to the school systems.” Even more egregiously, a Houston based recruiting firm called Professional and Intellectual Resources exclaims that their “bargain-priced” Filipino teachers can “make the most out of the most minimal resources. 

Memorizing isn’t learning This criterion for hiring makes sense in the context of what philosopher Paulo Freire calls “the banking concept of education.” In his 1968 classic, The Pedagogy of the Oppressed, Freire critiques the pedagogical tradition of rote memorization, in which the teacher-as-narrator “leads the students to memorize … the narrated content.” Freire argues, “It turns [students] into ‘containers,’ into ‘receptacles’ to be ‘filled’ by the teacher. The more completely she fills the receptacles, the better a teacher she is.”

However, Freire’s “narrative” is no longer even in the hands of teachers, who might at least have some understanding of content relevant to students. Instead with the rise of test-based approach to education, forced through with No Child Left Behind, Race to the Top, Common Core, and numerous ramped-up state tests, nameless corporate and federal employees now tie teachers and students’ success to the production of higher test scores. Thus, today’s cutting-edge education reform movement has brought this “banking concept of education” back into vogue, demanding “objective measures” and “accountability” through constant standardized testing. 

The idea that new teachers should be imported from halfway around the world for yearlong stints, knowing no background about the communities they are entering and the content relevant to them, is only justified if the teacher is reduced to an instrument of standardized information transmission. And if teachers are just such instruments, why not search the global market for the cheapest, most malleable ones possible?

As Books and de Villiers point out, many recruiters’ advertisements reflect this logic: “Only two [recruiters’] websites apprise teachers of the socio-economic, racial, ethnic, and religious diversity in many U.S. schools. Only five include useful educational links, and only three provide information about school-based mentoring.” So for corporate recruiters and their district clients, finding the right match for a school is not about teacher quality or experience, but rather cost and expendability.

The phenomenon of teacher trafficking, then, doesn’t rest entirely on recruiters’ mercenary tendencies or districts’ drive to cheapen their labor. It also rests on the larger neoliberal conception of workers. In this case, teachers become moveable parts, switched out in accordance with the iron laws of supply and demand in order to more efficiently output successful test scores, whose value comes to represent students themselves. 

Colonialism in the classroom The American importation of Filipino teachers, as well as educators from other countries, has consequences beyond the United States, too. According to Books and de Villiers, several recruiting agencies only seek out teachers in the Philippines because its high poverty rates and supply of quality teachers make it, as one journalist from the Baltimore Sun put it, “fertile ground for recruits.” Meanwhile, the nation has an estimated shortage of 16,000 educators and the highest student-teacher ratio in Asia at 45:1.

As one Filipino union leader told the American Federation of Teachers, “To accommodate the students, most public schools schedule two, three and sometimes even four shifts within the entire day, with 70 to 80 students packed in a room. Usually, the first class starts as early as 6:00 a.m. to accommodate the other sessions.” And as American corporate forces have exploited the Philippines for its best teachers, pushed across the world by the beck and call of the market, agents of the nonprofit world have taken it upon themselves to send American substitutes in their place.

Launched last year, Teach for the Philippines presents itself as “the solution” to this lack of quality teachers in the country—a claim similar to those of its U.S. parent organization, Teach for America, a behemoth nonprofit that each year recruits thousands of idealistic college graduates to become (and often replace) teachers in low-income communities after a five-week training camp.

The Teach for Philippines promo video begins with black and white shots of multitudes of young Filipino schoolchildren packed into crowded classrooms, bored and on the verge of tears. A cover version of a Killers song proclaims, “When there's nowhere else to run … If you can hold on, hold on” as the video shifts to the students’ inevitable fates: scenes of tattooed gang kids smoking, an isolated girl and even a desperate man behind bars. In the midst of this grotesquely Orientalizing imagery, text declares, “Our Country Needs Guidance,” “Our Country Needs Inspiration,” and finally “Our Country Needs Teachers.”           

Teach for the Philippines recruits young Filipinos both domestically and internationally, with special outreach to Filipino Americans. Though still in its start-up phase, with only 53 teachers in 10 schools, the program presents a disturbing vision for the future of teaching in the context of a global workforce. While the Filipino teachers imported to America are not necessarily ideal fits, given their inability to remain as long-term contributors to a school community, at least they are for the most part trained, experienced instructors. Within the Teach for the Philippines paradigm, however, Filipino students, robbed of their best instructors, are forced to study under recruits, who may lack a strong understanding of the communities they are joining and have often have never even had any actual classroom experience.

But Teach For the Philippines is just one growing arm of Teach for America’s global empire, now spanning the world sites in 33 countries and enjoying millions in support from neoliberal power players like Visa and even the World Bank. So while austerity-mode Western nations may seek to cut costs by employing no-benefits guest workers, countries such as the Philippines will be forced by the unbending logic of the market to plead for international charity—summer camp volunteers looking to “give” two years of their lives to really make a difference.           

In the Pedagogy of the Oppressed, Freire argues, “It is to the reality that mediates men, and to the perception of that reality held by educators and people, that we must go to find the program content of education.” But for such a reality to be approached, teachers and communities must have the opportunity to grow together, to listen to each other, and to understand the reality that they seek to transform. By pushing teachers into a globalized pool of low-wage temp workers, teacher trafficking precludes this possibility.








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April 07th, 2014

4/7/2014

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As I showed last blog on private sector pensions, most pension portfolios had pension investments in the bond market because previously the bond market was stable and a safe investment.  You can see from this snippet from an article that a deliberate move of private sector pensions in this massive Pension Benefit Guaranty Corp happened as the stock markets crashed in 2008. 

THIS WAS DELIBERATE AND PUBLIC MALFEASANCE WITH 1/2 OF PENSION VALUE LOST FROM THE FRAUD AND LOSS OF GAINS FROM THE BULL MARKET THAT FOLLOWED.




Pension Benefit Guaranty Corp.

'The PBGC regularly updates its investment strategy. In 2004, it chose to invest heavily in bonds.[6] Under new leadership, the agency in 2008 shifted a substantial portion of its assets into stocks.[7] Because of the market decline, PBGC's equity investments lost 23% during the year ending September 30, 2008.[8]'

Today we want to look at public pensions and know that the same thing happened at state and local level as these public pensions also were thrown into a crashing market in 2007.  So, it was Bush/Obama who made sure Federal pensions were used as fodder and in Maryland it was Baltimore City and Maryland public agency heads that made sure they hit the stock market as the crash was occurring.  THIS IS FACT.  When we hear corporate NPR/APM tell us that all of American savings and retirements were lost and now they have nothing going into their old age and have to work until they drop-------THEY ARE LYING TO YOU.

DO YOU HEAR YOUR INCUMBENT SHOUTING TO BRING PENSION FRAUD BACK TO FEDERAL, STATE, AND LOCAL PUBLIC PENSION FUNDS?  EVERYONE OF THEM KNOWS THIS HAPPENED! 

As I have said before pensions were underfunded for decades with the idea that they would be eliminated.  This move in 2007-2008 was designed to cripple pension funds and to buoy the Wall Street banks that were crashing.  Throwing the American people's pensions into bank stocks allowed these investment firms to earn billions of dollars more.  I want to emphasize that the same is about to happen this year as pensions are now being used in a sovereign/municipal bond fraud as this market is now ready to implode.  EVERYONE KNOWS THIS!

It was not only the losses to these pensions at the time of the collapse, it involves all of the gains those pensions would have had in the following BULL market.  You heard about Wall Street making great gains these few years----pension gains worked with 1/2 the value and they will again lose most value with this next collapse.  The rich are moving their investments out of US stocks while pensions are used to buoy the economies overseas and state and city credit bond schemes.



YOUR UNION LEADERS AT STATE AND NATIONAL LEVEL SHOULD BE TAKING THIS TO COURTS AND IF WE HAD A FUNCTIONING PUBLIC JUSTICE ERIC HOLDER AND DOUG GANSLER WOULD BE FIGHTING FOR PENSION JUSTICE.  THEY ONLY WORK FOR SHAREHOLDER LOSSES AND WE KNOW SHAREHOLDERS PROFIT ON PENSION LOSSES.

WHAT KIND OF PUBLIC ADMINISTRATION GOES BACK TO THE SAME PEOPLE WHO DEFRAUDED THE AMERICAN PEOPLE TO MANAGE RETIREMENT SAVINGS?




May 28 2013 | 12:10pm ET  FIN Alternatives


A Maryland public pension fund has a new hedge fund consultant and a pair of new private equity managers.


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ORGANIZATIONAL STRUCTURE STATE RETIREMENT & PENSION SYSTEM

BOARD OF TRUSTEES Nancy K. Kopp, State Treasurer, Chair (chosen by Board in June, 1-year term)
Peter V. R. Franchot, Comptroller of Maryland, Vice-Chair (chosen by Board in June, 1-year term)
Appointed by Governor with Senate advice & consent to 4-year terms: Robert R. Hagans, Jr., 2015; Harold Zirkin, 2015; Thurman W. Zollicoffer, Jr., Esq., 2015; David S. Blitzstein, 2016; Linda A. Herman, 2017; F. Patrick Hughes, 2017.



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As we know Governor O'Malley was central in all public pension losses first at the level of city and then state.  We know as well he is a great big Wall Street pol who based his entire political career moving the public's wealth to the top earners.  While states handle these shortfalls in pensions victimized by massive fraud and corruption by cutting what the people receive.......O'Malley/Brown pulls their regular routine of saying one thing and doing another.  Pension contributions were cut from what the article below suggests.  Remember, this coming economic crash will gut all these pensions again especially how they are currently invested.  Above you see the State of Maryland went immediately to the Wall Street investment firms who fleeced the public in 2007/2008 to hand our pensions for investment again.  O'Malley/Brown doubled-down on Wall Street financial instruments right after this crash from massive Wall Street fraud acting as nothing had happened.  SEE WHY BROWN IS THE DARLING OF MARYLAND 1%?

The LIBOR frauds, stock transaction frauds, and illegal stock management fees all took lots of money from the people's pensions, both public and private and has yet to get justice.  A governor would be shouting this if he/she worked for the public and not wealth and profit. 

DO YOU HEAR ANY OF THE CANDIDATES FOR GOVERNOR SHOUTING AS CINDY WALSH FOR GOVERNOR OF MARYLAND HAS FOR YEARS?


Governor Martin O'Malley Announces Plans to Put Pension System on Path to Sustainability


ANNAPOLIS, MD (January 21, 2010) –
Governor Martin O’Malley outlined plans today to address Maryland’s unfunded pension and retirement liabilities and begin to put the public system on a path of sustainability.  In introducing the FY 2012 budget proposal today, Governor O’Malley committed approximately $1.5 billion to the pension system next year, nearly $1 billion more than in FY 2003.

“Some of the toughest choices we face in this legislative session are the choices we make to fix our pension system,” said Governor O’Malley.  “We owe it to our police officers, teachers and other hardworking state employees and we also owe it to our children and our taxpayers, to find a sustainable way forward that protects our commitments and maintains fiscal responsibility.  This is a bill that we have to pay and all of us have a vested interest in finding the most fair and equitable way to keep our pension commitments.”

Governor O’Malley has outlined the basic principles on which pension reform is based:

  1. Continue to maintain a public system as a critical component of recruiting and retaining the best teachers.
  2. Improve the funding level in the State and Teacher retirement system.
  3. Reduce the pension and retirement liability, and therefore, we must ask current and future members of the system to contribute more to strengthen the system and preserve benefits.
  4. Identify certain milestones so as our economic circumstances change, we can revisit some of these reforms.
Find the Governor’s full pension reform presentation here.

In each of his first four years, Governor O’Malley has submitted budgets that fully funded the State’s required pension contribution.  But despite rapid increases in this contribution, the funded status of the pension system has dropped from 95% ten years ago to a project 59% next year. 

The Governor’s proposed reforms will allow the state to reinvest more than $1 billion into the retirement system over the next six years.  These reforms will achieve 80% funding of the pension system by FY 2023 and require bi-annuals reports assessing the financial health of the pension system, including recommendation for adjustments to state funding and/or future benefits.

Current employees and retirees The Governor’s proposed pension reform has no impact on current retirees and no impact on benefits already earned by active or former employees and teachers.

For benefits earned for service in FY 2012 and future years, active employees and teachers are offered a one-time choice between:

  1. Continue to pay 5% of salary towards retirement with adjusted benefit (1.5% benefit multiplier for each future year of service rather than current 1.8% benefit multiplier).
  2. Increase contribution to retirement from 5% to 7% of pay and continue to earn benefits at the current level (1.8% benefit multiplier for each future year of service).
Future employees and teachers New employees will automatically be required to contribute 7% of salary and receive a 1.5% benefit multiplier.  In addition, year of benefit vesting will move from the current five years of service to ten years.  Early retirement age will increase from the current 55 to 60, and the benefit will be calculated on the highest five years of salary rather than the highest three years.  Finally, cost of living adjustments will be based on investment benchmarks.

In addition, the Governor announced plans to direct the appropriate Compensation Commissions to review pensions for elected officials for sustainability and fairness.

Health benefits Almost half of the unfunded liability associated with retiree health benefits relates to Maryland’s prescription drug benefit.  For current retirees, the proposes reform plan establishes a state-run Medicare Part D-like plan that mirrors the federal program but fills the current coverage gap.  In 2020, the plan transitions these retirees to Medicare Part D coverage in 2020 when the coverage gap is phased out. 

For active employees, the proposed plan aligns co-pays with national trends and raises out-of-pocket caps from $700 to $1,000 for individuals and $1,500 for couples.

The current unfunded liability of retiree health insurance stands at $16 billion.  After the proposed reforms, that figure drops by almost 50%.



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The articles below show that states actually having public justice and unions working for their membership are exposing massive statewide fraud and demanding justice.  The same conditions here in Maryland have silence from both politicians and union leaders.

I bet if a governor was elected who shouted out for justice-----labor and justice would shout as well. 

STOP ALLOWING SYSTEMIC FRAUD AND CORRUPTION END DEMOCRACY IN MARYLAND AND AMERICA!

Take a look below at the other raging Wall Street pol thinking of running for President in 2016 with O'Malley.  Now, the State of New York Attorney General was the one responsible for holding Wall Street banks accountable and as we all know------CUOMO LET THEM ALL KEEP THE LOOT. 

Below you see Cuomo feeling the pain of the people he was elected to protect but didn't.  WHAT, FRAUD IN THE PUBLIC PENSION SYSTEM?

Cuomo declared his candidacy for the Democratic nomination for New York State Attorney General in 2006
He won the general election against the Republican nominee, former Westchester District attorney, Jeanine Pirro on November 7, 2006, winning 58% of the vote.



NEEDLESS TO SAY ALL OF THE BRAVADO IN THE ARTICLE BELOW USED TO GET HIM ELECTED GOVERNOR NEVER MATERIALIZED IN CONVICTIONS OR RECOVERING FRAUD.  IT WAS AN ELECTION YEAR SCAM JUST AS THE CONGRESSIONAL FINANCIAL REFORM BILL HAS TURNED OUT TO BE.


Hedge Fund Donor List Raises Question: Is Cuomo "Governor 1% ...www.wnyc.org/blogs/empire/2012 Between June 1, 2007 and December 21, 2011, hedge fund employees, founders and their families have given Cuomo more than ...

WHY DO YOU NOT HEAR ABOUT MARYLAND'S PENSION FRAUD THAT WERE AS BAD AS NEW YORK AND CALIFORNIA?  DOES MARYLAND HAVE A PUBLIC MEDIA?  NO!



Systemic Fraud at Public Pension Funds?

New York's Attorney General Andrew M. Cuomo said on Friday that his office was issuing more than 100 new subpoenas to investment firms and intermediaries who brokered deals with public pension funds, in the latest expansion of his corruption investigation:

Mr. Cuomo said a preliminary review by his office found that as many as half of the intermediaries in pension fund transactions in New York State and New York City were not properly licensed and registered with a broker-dealer, as required by federal securities laws. Failing to register could violate both federal securities laws and the Martin Act, a sweeping state securities law.

“The troubling pattern of unlicensed agents highlights yet another systemic weakness in New York’s pension fund, creating a situation which is fraught with peril and prone to abuse,” Mr. Cuomo said in a statement.

He also conferred with the offices of 35 other attorneys general Friday afternoon by teleconference. The pension corruption inquiry has raised questions about public investment practices in other states, in particular New Mexico and California.

Afterward, Mr. Cuomo said the group had “decided to create a multistate task force to explore pension fund abuse.”

Mr. Cuomo’s office has been working with the Securities and Exchange Commission, which is conducting a parallel investigation. Federal investigators are also reviewing public investment transactions in New Mexico, and the S.E.C. is reviewing pension transactions in California.


Among the firms being scrutinized in the latest round of Mr. Cuomo’s inquiry is Wetherly Capital Group, according to people with knowledge of the inquiry. Investigators are scrutinizing whether employees of Wetherly and other firms were properly licensed when they arranged deals with pension funds in New York.

Wetherly is a Los Angeles-based placement agent firm run by Dan Weinstein, a prominent Democratic fund-raiser. In a statement, Wetherly said it was fully registered with the Financial Industry Regulatory Authority and the S.E.C.

Wetherly has come under scrutiny in California for paying a firm affiliated with Hank Morris, a top aide to Alan G. Hevesi, the former New York State comptroller, as part of an investment deal it brokered for Calpers, the giant California pension fund.

Another California firm being scrutinized in the latest round of the investigation is Gold Bridge Capital, which has acted as a placement agent on at least one deal involving the New York State pension fund.

The inquiries by Mr. Cuomo and the S.E.C., under way for two years, have focused on the millions of dollars that friends, relatives and aides of Mr. Hevesi’s gained by selling access to the $122 billion New York State pension fund. Mr. Morris and David Loglisci, another former top aide to Mr. Hevesi, have been indicted on a variety of corruption-related fraud charges, and Raymond B. Harding, the former head of the state Liberal Party, has also been charged in the case. All three have pleaded not guilty. Mr. Hevesi has not been charged.

The inquiries took on more national relevance on Thursday when Mr. Cuomo charged a top consultant to pension funds around the country, Saul Meyer, with a fraud-related felony. Mr. Meyer and his firm, Aldus Equity, which is based in Dallas, were also charged in a civil complaint by the S.E.C. Both Mr. Meyer and Aldus denied wrongdoing.

The new phase of the inquiry focuses on lobbyists, political consultants and others who brokered deals between investment firms and the New York pension funds but were not properly registered to do so.

In a preliminary investigation, Mr. Cuomo’s office found that from 2003 to 2006 — the period when Mr. Hevesi was comptroller — 22 of the 45 intermediaries used in deals at the state pension fund were not registered. In the New York City pension funds, 17 of 41 intermediaries were unregistered in deals from 2003 to this year, a review found.

While acknowledging that there could be exceptions, Mr. Cuomo said during a separate teleconference with reporters on Friday, “If you’re brokering a security, you need to be regulated.”

Thomas P. DiNapoli, the New York State comptroller, and William C. Thompson Jr., the New York City comptroller, both said this week that they would move to ban placement agents from deals with their pension funds.


Mr. Cuomo also highlighted a shortcoming in state lobbying rules, which do not require lobbyists to register with the state’s Commission on Public Integrity when they appear before the state comptroller.

The increased scrutiny on placement agents in recent years has led to concerns that lobbyists and political consultants are trying to find ways to perform similar services without registering as placement agents.

In 2007, Mr. DiNapoli met with the chief partner of the private equity firm InterMedia Partners, Leo J. Hindery Jr., and Roberto Ramirez, a lobbyist and former colleague of Mr. DiNapoli’s from the Assembly. The goal for the meeting was to convince the state comptroller’s office to increase its investment with InterMedia, which it later did. A spokesman for Mr. Ramirez has said he was not paid by InterMedia and appeared only as a friend of Mr. Hindery’s.

Mr. Cuomo would not say which lobbyists or consultants were being scrutinized, but said the intersection of unregistered agents and the pension fund was potentially “the Wild West of government relations.”Mr. Cuomo also said that pension kickbacks are a national problem:


New York state's criminal probe of kickbacks paid by companies eager to manage its $122 billion state pension fund has exposed "a national network of actors" whose schemes are ongoing, state Attorney General Andrew Cuomo said on Thursday. "This is all across the nation, and it's continuing today," the Democratic attorney general said on a conference call.

The probe, which began two years ago, has fixed the spotlight on the use of placement agents hired by investment firms to open the doors of the New York State Common Retirement Fund. Cuomo said he is also is scrutinizing lawyers and lobbyists.

The investigation is another effort to stamp out graft and the practice of "pay to play," which involves giving gifts or campaign donations to win public contracts. So far the probe has looked into the web of relationships and business contracts involving money managers, politicians and pension officials spanning the country from New York City and the state capital, Albany, to Texas, New Mexico and California.

On Thursday, the U.S. Securities and Exchange Commission, which is working with Cuomo, charged that Dallas-based Aldus Equity Partners won New York pension business because of "its willingness to illegally line the pockets of others."

The state pension fund had aimed to hire more women and minority-owned investment firms and had begun talks with one. But Aldus was chosen, Cuomo said, when the minority-owned firm "allegedly refused to pay kickbacks to Morris and another associate."

Aldus, a private equity firm, says it manages over $5 billion, and the probe already has cost Aldus clients in New Mexico and New York. Cuomo said Aldus also is active in Louisiana, Oklahoma, Texas, California, and New York City.

ANOTHER VIEW OF GIVE AND TAKE

Both Cuomo and the SEC charged that Saul Meyer, an Aldus founder, paid about $320,000 to a shell company owned by Henry Morris, a top fund-raiser for New York's former state comptroller. This led the New York state pension fund's then-chief investment officer, David Loglisci, to invest $375 million with Aldus from 2004 to 2006.

Demonstrating the power that Morris wielded over pension investments, Cuomo said Morris told a Meyer intermediary: "Tell that little peanut of a man that I can take business away as easily as I provided (it)."

Lawyers for Morris and Loglisci, who were indicted in March, say they are innocent.

On Thursday, Meyer was charged with a state securities felony and released on $200,000 bail. His lawyer Paul Shechtman said: "Time and evidence will show that Saul Meyer did nothing wrong."

Aldus knew that Morris was "working both sides of the deal," Cuomo said, by marketing funds for investments in the Aldus/NY Emerging Fund in which Morris had a 35 percent stake.

Aldus Equity lawyer Matthew Orwig faulted the SEC for acting before finishing its probe, calling the threatened legal action "appalling and careless with the law and with people's reputations." Aldus partners said they were disappointed by the "unexpected legal developments."

Aldus could face more legal peril. The New York state pension fund is weighing legal remedies against Aldus and Meyer after ending its investment with the firm. New York City pensions could cut ties with the firm, while New Mexico's governor called on the state Education Board to drop its contract with Aldus a day after ordering the state investment officer to do so.

Cuomo said that while Meyer was seeking more business with New York's pension fund, he helped Daniel Hevesi, a son of Alan Hevesi, the former state comptroller whose oversight of the state pension fund is being probed, earn a $250,000 fee on a New Mexico pension deal.

Alan Hevesi's lawyer Bradley Simon has said the former comptroller "has not been charged with any misconduct with respect to mismanagement of the New York state pension fund."

Bloomberg reports that L.A. pension is baffled by fees paid to firm in probe:


Los Angeles retirement plan managers say they’re baffled over fees paid by Quadrangle Group LLC to a key player named in New York’s pension fund kickback probe for helping the private equity firm land work in California. Quadrangle paid Searle & Co. $150,000 in connection with the Los Angeles Department of Fire and Police Pensions fund’s $10 million investment with the New York firm, which was co- founded by Steven Rattner before President Barack Obama appointed him to oversee the auto industry rescue.

Searle employed Hank Morris, a political adviser accused by New York State Attorney General Andrew Cuomo and the U.S. Securities and Exchange Commission of using the Greenwich, Connecticut, brokerage to collect “sham” placement fees from firms that manage New York pension plan money.

After the SEC this month said Quadrangle paid Morris a “finders fee” related to a New York pension fund investment, Quadrangle told the Los Angeles fund that it also had paid placement fees to him for work there. The Los Angeles fund publicly disclosed the fee April 24.

“We don’t know how or why a placement fee related to our investment in Quadrangle was made,” Michael Perez, the general manager of the Los Angeles pension, said in written responses to questions from Bloomberg News.

‘Shocked’ at News

Perez said the fund’s investment in Quadrangle was arranged through Pension Consulting Alliance Inc., which evaluates investments on its behalf. Allan Emkin, that company’s founder and managing director of its Los Angeles office, said it didn’t have any contact with Searle or Morris and worked directly with Quadrangle. Emkin said he had been unaware that Searle was paid a fee in connection with the deal.

“We were shocked when we heard about it,” Emkin said in a telephone interview.

Morris, who faces a civil SEC complaint and criminal charges by Cuomo, has denied wrongdoing. Quadrangle and Rattner haven’t been charged. Adam Miller, a spokesman for Quadrangle, declined to comment. Searle referred calls to Peter Anderson, an attorney, who didn’t respond to requests for comment.

The SEC has asked the Los Angeles fund and two of its board members for information about investment decisions and firms tied to the New York probe.

Cuomo said today that New York was formalizing agreements to coordinate its investigation with authorities in California, as well as with Connecticut, Illinois and New Mexico.

Los Angeles Connection

“We are disclosing a national network of actors, who often acted in concert,” Cuomo said. “They collaborated, they often partnered and victimized states and taxpayers all across the country.”

The SEC and Cuomo today charged Saul Meyer, the managing partner of one of the firms in the New York probe, Aldus Equity Partners, with paying Morris to secure investment business with New York. Aldus has served for more than a year as a private equity consultant to the Los Angeles pension fund. Meyer met with the fund’s board at least once, city records show.

Morris, the one-time chief fundraiser and political adviser to former New York City Comptroller Alan Hevesi, has been charged by the SEC with collecting $15 million in kickbacks from money managers doing business with New York’s pension fund. The SEC says the kickbacks were masked as placement fees and that he “rarely, if ever” provided legitimate services.

Quadrangle hired Morris as a placement agent before winning a $100 million investment from New York, the SEC said in an April 15 complaint. The firm paid Searle $1.125 million, and 95 percent of that went to Morris, the SEC said.

The Los Angeles pension approved investments in 10 private equity funds linked to the New York investigation, according to an April 2 memo to the board. Two of the investments were later canceled. Aldus Equity Partners, which was drawn into the New York probe, also advised the fund on private equity investments.

I have already written about the Mother of all stealth scams. Nothing like a huge financial crisis to bring out all the cockroaches. This hardly surprises me and remember my dire warning: Madoff was the tip of the iceberg. There will be many more fraudsters that will get nabbed in the next few years.

Just how systemic is fraud in the financial industry and at public pension funds? We don't know, but when you mix greedy placement agents with public pension fund managers who control billions, the potential for kickbacks is huge.

What can pension funds do to stop abuse before it happens? First, they should segregate duties so the person(s) making the investment has to pass through several checks, including an internal auditor, before the decision is cleared. Importantly, there should also be clear segregation of duties between those making the investment decisions and the finance professionals valuing them.

Second, pension funds need to beef their whistleblower policies so people are encouraged to report abuse. This is one of the most effective ways to stop fraud. Maybe there should be a direct link between public pension fund employees and the state's Attorney General's office or the provincial or federal Auditor General's office.

Third, have your fraud procedures verified by a certified fraud examiner (read more on CFEs by clicking here). This should include someone who scrutinizes travel/meal/entertainment expenses to make sure there is no abuse going on when some hedge fund or private equity manager is trying to woo a pension fund manager to invest with them.

Fourth, there should be tight rules governing the relationships between investment managers and the funds they invest with. If you are investing billions with Fund Z, then you should not be allowed to go work for them for a period of five years after you leave a public pension fund. This is just common sense, but you'd be surprised how common sense often falls by the wayside.

Fifth, all board decisions should be made public so they are open to scrutiny. Several of the large U.S. state plans already do this. For example, Alaska's Permanent Fund publishes its board schedule, their minutes and their consultants on their website.

Finally, on the legal front, I would ban all placement agents and place tight rules on pension consultants who recommend funds to pension funds. Do not underestimate the abusive practices of pension consultants and the potential for fraud with them. They are the gatekeepers at most U.S. pension plans.

It truly is the Wild West out there, but I am glad to see the Attorney General of New York is pursuing the pension probe and trying to clean up public pension funds.


_________________________________________


Corrupting public officials is a crime so as the public officials who we know were involved in these frauds are exposed we know these investment firms buying favor committed these crimes too.  You have yet to hear of these private equity people charged and prosecuted because that takes public justice.  Whether it is blowing up the Federal Housing Agency with fraud, the Federal Student Loan Agency with fraud----we are being told by Moody's and S and P -----the rating agencies that were ground zero for all of this fraud-----that public and private pensions
are just not viable anymore.

OH REALLY????????


If your incumbent politician goes after the people's pensions as the problem------if your incumbent is silent about all of this, they are neo-liberals working for wealth and profit.  These pensions are not a burden on the public-----all fraud recovery comes from these corporations.


I listened to a Governor's Forum on Education (to which I was not invited obviously) where Heather Mizeur says that the way to fund school building in Maryland is to have public employees give back some of their pensions.  THIS IS THE PHONY PROGRESSIVE IN THIS GOVERNOR'S RACE!



Monday, March 14, 2011

Corruption at CalPERS?

Marc Lifsher and Stuart Pfeifer of the Los Angeles Times report,


Scathing report alleges corruption at CalPERS
:
In a scathing report, a former chief executive of the California public employee pension fund was accused of pressuring subordinates to invest billions of dollars of pension money with politically connected firms.

A 17-month investigation also found that Federico Buenrostro Jr. — along with former pension fund board members Charles Valdes and Kurato Shimada — strong-armed a benefits firm to pay more than $4 million in fees to consultant Alfred J.R. Villalobos, who later hired Buenrostro.

The report, prepared for the California Public Employees' Retirement System by Washington law firm Steptoe & Johnson, comes amid widening attacks on public employee pension funds in California, Wisconsin, Iowa and other states for providing lavish benefits that cash-strapped governments can no longer afford.

The findings of insider dealings at CalPERS could provide fresh ammunition to Republican lawmakers here who want Democratic Gov. Jerry Brown to convert traditional pensions with guaranteed payments for life into 401(k)-type plans that rely heavily on employees' own contributions.

"Fixing California's pension problem is difficult enough without the stench of corruption and collusion that saps public confidence and gives taxpayers a reason to withhold support," said Dan Pellissier, president of Californians for Pension Reform, a group that is pushing a 2012 ballot initiative that would diminish state employee pension benefits.

Shimada, Buenrostro, Valdes and Villalobos either declined to comment or did not return calls.

Buenrostro served as CalPERS chief executive for six years, leaving in August 2008. The day after quitting, he went to work for Villalobos — a former CalPERS board member and deputy Los Angeles mayor who acted as an agent for investment firms seeking CalPERS money. The report said Villalobos hired Buenrostro with a $300,000 annual salary and gave him a Lake Tahoe condominium.

While at CalPERS, Buenrostro repeatedly "inserted himself in the investment process in a manner inconsistent with prior practice at CalPERS, pressing its investment staff to pursue particular investments without evident regard for their financial merits," the report said.

It said Buenrostro intervened with staff on behalf of Aurora Capital Group of Los Angeles to obtain investment money. Buenrostro told subordinates that Aurora was politically powerful, and that Aurora principal Gerald Parsky served on a state commission dealing with public employee benefits, the report said.

Aurora was a Villalobos client, and Buenrostro told CalPERS staffers that he would represent it once he went to work with Villalobos, the report said.


The report also noted that Buenrostro often intervened on behalf of favored private equity funds that staff called "friends of Fred."


Staffers ultimately complained about Buenrostro to the board, and those complaints "became a basis for the board's efforts to replace him as CEO," the report said.

CalPERS is the nation's largest public pension fund, with $228 billion in assets, providing benefits to about 1.6 million state and local government employees, retirees, spouses, children and other beneficiaries.

In May 2010, the California attorney general sued Villalobos and Buenrostro, accusing them of scheming to enrich themselves through self-dealing and other misconduct in seeking CalPERS investment money on behalf of clients.

According to the report, one of those investment funds — Apollo Global Management — asked Buenrostro to sign documents acknowledging that CalPERS was aware of so-called placement agent fees it was paying to Villalobos.

Several CalPERS investment officers refused to sign the disclosures, the report said — but Buenrostro did, using pasted-on letterhead to make them look more official.

Buenrostro made "representations regarding placement agent fees and related deal documents that are either demonstrably false or sufficiently suspect," the report said.

The report, citing Buenrostro's ex-wife and an unnamed girlfriend, described Buenrostro as "a puppet" of Villalobos, who the report said earned more than $50million in placement agent fees.

During his six years as head of CalPERS, Buenrostro received many valuable gifts from people and firms with financial interests in doing business with CalPERS, the report said.

When he was married in 2004, he allowed Villalobos to host the wedding at his Zephyr Cove, Nev., home. Buenrostro also traveled with Villalobos and Valdes to the Middle East and Asia — with Villalobos picking up much of the costs, the report said.

"Buenrostro does not appear to have ever disclosed these gifts or recused himself from any CalPERS matters based on any of these apparent relationships," the report said.

Valdes also pressured CalPERS investment staff to do business with Villalobos' firm, Arvco Capital Research, the report said.

In September 2000, Valdes was close to being ruled out of order for raising his voice in support of a Los Angeles real estate investment firm, CIM Group, the report said. CalPERS staff had recommended a smaller investment than originally proposed. Arvco and Villalobos received a $9-million commission on the investment transaction.

CIM also provided Academy Awards tickets to Valdes and other CalPERS people, the report said. Valdes attended in 2005 and 2006 but did not report the gifts on state financial disclosure documents.

The report also provided new details about CalPERS dealings with Medco Health Solutions Inc. before the firm was awarded a $26-million contract to provide drug benefits to members.

In May 2004, Villalobos hosted a meeting at his Lake Tahoe home with Medco CEO David Snow. Buenrostro attended.

"Soon after the May 2004 meeting at the Villalobos home, Medco agreed to retain Villalobos as a consultant and pay him $4 million," the report said.

Villalobos received a final check for $1 million immediately after the CalPERS board approved the contract, according to the report, and also received a $20,000-a-month retainer until sometime in 2009.


Last year Villalobos filed for personal bankruptcy protection, citing nearly $5million in debts to Nevada casinos. It was his second personal bankruptcy.

The report recommended that CalPERS improve accountability and reduce the risk of future abuses, including providing additional training to board members so that board business is not conducted in clandestine meetings with managers, and prohibiting the release of sensitive CalPERS information outside the organization.


This is a perfect example of serious governance gaps leaving a fund vulnerable to fraud. There is absolutely no accountability when this type of abuse goes on at the highest level. And trust me, it's not hard for a couple of guys at the top to collude and award sweet contracts to some consultant, hedge fund manager or private equity manager in return for "future favors". When you're in charge of billions, power gets to your head and you start thinking you're invincible.


This type of fraud makes me sick to my stomach. It's not common but it's going on a lot more often than people want to admit. How do I know? Let's just say I've seen things that made my skin crawl. It doesn't matter whether the investment officer has a CFA, FRM, PhD, etc., if they're crooked, they're crooked and they'll do whatever it takes to profit by abusing the power they have within a pension fund. And it's not just the large funds; in fact, some of the worst abuses happen in dinky city pension plans where corruption is rampant.

That's why I believe you have to properly compensate senior pension officers to deter this type of corruption. But that's not enough because some people are so sleazy, so greedy, they'll look to game the system and will stop at nothing to profit by abusing their power. One of the best ways to root out corruption is simply to segregate duties and implement iron clad whistleblower policies where employees can anonymously inform board members or better yet, the FBI or RCMP. That should make these idiots think twice before they abuse their power at a public pension fund.

Finally, this is a particular case that in no way reflects what's going on at CalPERS now. I think it's disgusting that some would use this report as "ammunition" to break up CalPERS or to dissolve other public pension funds. Get the governance right and you can root out corruption at most public and private pension funds.
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April 02nd, 2014

4/2/2014

0 Comments

 
FOLKS, PUBLIC JUSTICE IS GUARANTEED UNDER THE US CONSTITUTION AND AMERICA HAS ONE OF THE BEST WRITTEN LAW PROTECTING THE AMERICAN PEOPLE AS CITIZENS.  RULE OF LAW AND EQUAL PROTECTION ARE THE CORNERSTONE OF OUR DEMOCRACY AND NEO-LIBERALS AND NEO-CONS ARE DISMANTLING THIS BECAUSE THEY NOW SEE THE US AS CONTROLLED BY GLOBAL CORPORATE TRIBUNALS AND NOT FEDERAL LAW.

IF WE DO NOT TAKE A STAND NOW BY VOTING FOR A GOVERNOR AND MAYOR/COUNTY EXECUTIVE WHO WILL SHOUT OUT FOR OUR CONSTITUTIONAL RIGHTS WE WILL BECOME A TOTALITARIAN NATION.  AS NOAM CHOMSKY SAYS----A NATION RUN BY CORPORATIONS CAN ONLY BECOME TOTALITARIAN.

Anthony Brown, Doug Gansler, and Heather Mizeur all expect to continue this dismantling of public justice.  Do you hear Heather, the supposedly progressive candidate shouting about Maryland's dismantling of public justice? Stop electing the same people killing democracy and Rule of Law.

I spoke yesterday about the systematic dismantling of our legal system including the decline of law school grads and hiring of lawyers in the US.  Today I want to look at how the public justice system is being made the step-child of corporate law firms designated as providing  the public 'PRO BONO' JUSTICE. 



Regarding rebuilding Rule of Law in Maryland:

As WYPR's Basu tries to convince people that the US did rise out of recession and that all the economic data was not just the FED's crony policies moving massive corporate fraud out of the country through merger and acquisition overseas and part two of the massive subprime mortgage fraud called the bundled foreclosures fraud that drove the housing market boom......NO ONE BELIEVES IT!  A recovery based on the wealthy of the world sending the money looted from their nations Treasuries over to the US in real estate purchases is not a recovery and is why these several years showed only growth in wealth at the top.  It is also why most academic and financial analysts call all of this activity crony and criminal and the Wall Street/FED connection now a cartel.  It is acting separately from the American economy and acting under no Rule of Law.  All of this is reflected down the government chain at state and local levels.  Ergo, wealth inequity.  Corporate NPR/APM feels our pain as it states 1 in 7 Americans are on Food Stamps all just waiting for Rule of Law to bring back tens of trillions of corporate fraud with government watchdogs stating each citizen in America will receive a few hundreds of thousands of dollars from fraud recovery.  

SIMPLY REINSTATING RULE OF LAW AND RECOVERING CORPORATE FRAUD TAKES MUCH OF THE NEED FOR FOOD STAMPS AND IMPOVERISHMENT GOES AWAY.  EASY PEASY!!!

I spoke last time about rebuilding public justice in Maryland by using committee appointments and using the governor's bully pulpit to get state agencies to DO THE JOB OF SERVING IN THE PUBLIC'S INTEREST.  Outsourcing for lawyers and creating grants for law schools to expedite law grads steeped in white collar crime and public justice will have new public justice employees in just a few years.  It is easy for the governor to do with no help from the corporate Maryland Assembly.  

Let's look at the other structures of public justice that have been deliberately 'broken' so as to eliminate the people's ability to access justice.  Now, remember, public justice is not only the poor, working and middle-class people can no longer afford legal representation for most crimes so this issue is about all citizens of Maryland seeking justice for corporate crime and government corruption.

Below you see an article from Ireland that speaks to the same thing happening in the US.  We know law school tuition is rising to create exclusivity and we know law firms are raising their fees to a point that the average person cannot afford to litigate.  THIS IS DELIBERATE.  This places most Americans into the hands of public justice and when the State and City Attorney have no white collar criminal agencies or government corruption agencies-----you go to legal aid or public non-profit legal teams like the National Lawyer's Guild or Maryland ACLU.  If you live in Maryland you know that the Maryland ACLU is silent on most civil liberties and civil rights violations and the system of funding legal aid and public justice --------pro bono volunteering of private law firms to help the public----is crony and not intended to provide EQUAL PROTECTION UNDER LAW.


THE MONEY SENT BY THE STATE TO FUND PUBLIC JUSTICE IS A JOKE.  HAVING CORPORATE LAWYERS DECIDE WHICH CASES THEY ACCEPT AS PRO-BONO AS PUBLIC JUSTICE??????   REALLY????

This is the problem and it is a joke.  So, first we rebuild the State and City Attorney's Office white collar crime and criminal justice offices so that pro-bono work by private law firms will rarely be needed.




Law fees rise despite lawyers’ protests
Tynwald buildings

Tynwald buildings

Published on the 27 June
2013
11:45


Legislation to increase various fees for litigants in the island has been approved by Tynwald despite a formal letter of objection from many of the island’s advocates.

The change will see big price hikes in the cost of, for example, taking out a small claim.

Speaking in Tynwald, Douglas East MHK Brenda Cannell said the points raised in the advocates’ letter were valid and the motion was being proposed without a full appreciation of the likely impact.

Onchan MHK Zac Hall said the advocates’ letter had been sent with the blessing of the Law Society. It was endorsed by 12 firms and ran into eight pages.

‘This will create a society where unscrupulous people will believe they can get away with it and the most vulnerable sections of society will be affected by this,’ he said.

Alex Downie MLC said three quarters of small claims were under £1,000 and the fee increase for these was £10 to £20. But Mr Hall said for small claims in the higher band the cost would rise from around £649 to £7,500.

‘That’s an outrageous increase,’ he said.


An amendment proposed by Onchan MHK Peter Karran to refer the matter back to the Social Affairs Committee was defeated 14 to 10 in Keys and seven to one in Legislative Council.

Treasury Minister Eddie Teare said the points in the advocates’ letter had been raised ‘at the 11th hour’ and added: ‘Access to justice is determined not just by court fees but also by fees charged by legal advisors and I feel they need to have a look in the mirror. I have done what I said I would do in May and I’m sticking to my guns. This fees order is still very reasonable and competitive compared with other jurisdictions.’

The increases were approved by 15 votes to nine in Keys and by seven votes to one in Legislative Council.

Law Society president Kevin O’Riordan told the Independent he felt access to justice for many was being jeopardised by cuts in legal aid and increases in court fees.

‘It’s not something lawyers are championing, except on behalf of their clients,’ he said.

‘Sadly, there has been an unfortunate lack of consultation with the legal profession on this issue as well as others of relevance to us. I understand the need to control spending, but not the apparent reluctance of the government to recognise that lawyers may have a useful contribution to make to the debate.

‘It is the client who has to pay court fees, which go to the Treasury rather than to the lawyers, so that we are not directly affected. Those who feel the impact of these increases will be the growing number of people who do not qualify for legal aid but are still of relatively modest means.

‘I also have to register disappointment at the Minister beating that tired old drum about excessive lawyers’ fees. He seems to be unaware of how much legal work is done by many advocates pro bono or at significantly discounted rates.’

____________________________________________


Now, I do not want to insinuate that these pro-bono groups do not have the intent to serve the people.  Why would we have such a huge private non-profit system of public justice unless we had no public justice in our State and City Attorney General's office?  This is the problem.  When you have individuals deciding which cases to take as pro-bono instead of an Attorney General's office pursuing all laws broken as is the duties of this office......you have lost Rule of Law and public justice.  So, in Maryland you will see no pro-bono work involving government corruption, white collar fraud, or corporate and wealth tax evasions----the major problems for the public.  Have a landlord problem?  You may get help.



The Pro Bono Resource Center of Maryland, Inc..,

(PBRC) is the statewide coordinator of volunteer legal services. Our mission is to promote equal access to justice in Maryland by coordinating and supporting volunteer civil legal services, providing resources and support for legal advocates for the poor, and promoting cooperation within the legal community.

About Us

PBRC is a separate non-profit organization which serves as the designated “pro bono arm” of the Maryland State Bar Association (MSBA). PBRC works closely with legal services providers and local bar association pro bono projects throughout the state to help recruit, train, recognize and support pro bono lawyers. PBRC also provides support services (click HERE) to volunteers and programs in the way of free or discounted training, a Pro Bono and Judicare Litigation Fund, mentors and technical assistance.


We have compiled a list of pro bono programs offering a wide range of opportunities for attorneys interested in providing free civil legal services to the disadvantaged. In addition to direct client representation, several programs operate advice clinics and mentoring and training opportunities for volunteer lawyers. Most programs provide malpractice insurance.

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So, Maryland has a network of lawyers working for private businesses doing the public's legal work because the Federal,  State, and local justice offices are no longer doing that. 
Below you see the duties of all levels of public justice.

SEE WHERE EQUAL PROTECTION UNDER LAW HAS GONE?



What Are the Duties of the United States Attorney General?
By Angela M. Wheeland


Protecting the Public


    The primary duty of the United States attorney general is to serve the best interests of the public within the United States jurisdiction. He is responsible for enforcing civil rights, preventing unfair consumer practices and improving the lives of United States citizens by proposing environmental protection laws and changes in criminal procedures.

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Now, Maryland's lawyers where ground zero for much of the subprime mortgage fraud and are indeed quite wealthy because none of the massive fraud has been recovered.  So, when lawyers 'donate' time for public justice, especially for subprime mortgage fraud and the foreclosures caused by these crimes.....there is a conflict here don't you think?  If I wanted to take to court the fact that these cases are not being pursued do I really contact these lawyers?  Of course not, that is the job of Maryland and Baltimore City Attorney.  IT IS THE DUTY OF THE STATE TO PROVIDE EQUAL PROTECTION UNDER LAW!

Do you think these law firms get tax write-offs for 'donating' this time?  YOU BETCHA!!!!!


The problem with foreclosure law is that the Maryland Attorney General signed off on settlements that were parking tickets and then sent the money to the state coffers where the money is now sent back to the banks for Enterprise Zone corporate development all creating profits for the banks committing the frauds.  Are these lawyers being trained to address this?  ABSOLUTELY NOT!

THIS IS THE JOB OF THE US ATTORNEY, STATE ATTORNEY, AND BALTIMORE CITY ATTORNEY----ERGO----PUBLIC JUSTICE.

The parking ticket settlements made these few years came with the requirement to rebuild white collar criminal justice agencies with these funds and Doug Gansler famously said 'I'll hire a lawyer to oversee the foreclosure process'.



 "Pro bono lawyers may be the only hope for many vulnerable or disadvantaged people throughout our state, many of whom have never before faced such dire circumstances."


IF NOT FOR THE KINDNESS OF STRANGERS AMERICANS WOULD HAVE NO PUBLIC JUSTICE-----ONLY ALL THIS IS ILLEGAL AS THE US CONSTITUTION GUARANTEES EQUAL PROTECTION AND RULE OF LAW.  THE PUBLIC JUSTICE SYSTEM CANNOT BE DISMANTLED.





Maryland Bar Bulletin
Publications : Bar Bulletin : March 2010     

|
Maryland Attorneys Donate 1.9 Million Pro Bono Hours to Help the State's Poor


~ Give close to $3 million in financial support ~

By Janet Stidman Eveleth

Despite the recession and our harsh economic times, Maryland lawyers donated close to 2 million volunteer hours in pro bono service in 2008, helping the state's poor with their legal needs. In addition, they contributed close to $3 million in financial support to increase legal services funding for the indigent. Traditionally, Maryland volunteer lawyers strongly support legal services to the poor and, when times are tough and people need help, lawyers step up to the plate and volunteer, giving their time, expertise and money to assist the needy.

One shining example of this is the state's Foreclosure Prevention Pro Bono Project where, in the six months this program was operational in 2008, 918 lawyers volunteered to first, undergo foreclosure training then help hundreds of Maryland homeowners in danger of losing homes to foreclosure. In 2008, these volunteers gave 13,737 hours in pro bono service to the Foreclosure Project and many accepted multiple homeowner cases.

According to the recently released 2008 Current Status of Pro Bono Service Among Maryland Lawyers Report (Report), Maryland-certified lawyers rendered 1,109,686 pro bono hours in 2008, an increase of 40,020 hours from 2007's 1,069,666 hours.  It also reports that 59.7 percent of Maryland's full-time lawyers volunteered for pro bono activity in 2008.  Over 22 percent gave 50 hours or more of pro bono service.

As always, lawyers hailing from rural regions like the Eastern Shore and Western Maryland rendered the most pro bono hours in the state while those in metropolitan areas tended to give the fewest. The Eastern Shore led the way with 80 percent of its attorneys giving pro bono service, followed by Western Maryland with 78 percent. The highest percentage of lawyers rendering 50+ hours also hailed from these two regions.

Somerset County captured the lead with 50 percent of its lawyers giving 50 hours or more of pro bono service, followed by Dorchester County with 45 hours and Queen Anne's and Talbot running neck and neck with respectively, 43.5 and 43.2.  "We are encouraged by the participation in these counties,"states Sharon E. Goldsmith, Executive Director of the Pro Bono Resource Center of Maryland, "becauseaccess to legal services is especially challenging in them."

Holding with tradition, the 2008 Report indicates that practitioners in Family/Domestic Law, Trusts/Estates/Wills, Bankruptcy, Personal Injury, and Elder Law give the most pro bono service and solo and small practitioners donate the most hours.  77.7 percent of Maryland's solo practitioners, and 71.4 percent of its small firm practitioners engaged in pro bono service in 2008, and about 17 percent of these practitioners volunteered for the Foreclosure Project.

Goldsmith, who oversees the Foreclosure Project, is delighted with its success. "The initial response of Maryland lawyers to the foreclosure crisis was unprecedented,"she exclaims. "These numbers indicate more than one third of the increase in pro bono hours in 2008 can be attributed to the Foreclosure Project."

"The Foreclosure Project continues to train and utilize volunteers in efforts to modify loans and identify creative solutions for sustainable homeownership,"she continues, "so we expect an even higher number of hours dedicated to the Project in the 2009 reporting cycle."

The Court of Appeals of Maryland has tracked attorney volunteerism across the state since 2002, reporting its findings each year in the Current Status of Pro Bono Service Among Maryland Lawyers Report. It is now in the process of compiling the 2009 results. All Maryland attorneys are required to file annual pro bono reports to the Court of Appeals. The 2009 forms were due February 15, 2010.

Attorney pro bono service is still voluntary in the state, but revisions to Rule 6.1 of the Maryland Rules of Professional Conduct, which took effect July 1, 2002, require all Maryland attorneys to file an annual Pro Bono Service Report with the Court. The form documents the number of hours of pro bono service the attorney rendered during the previous year. This pro bono summary gives the Court of Appeals a "snapshot"of the legal services landscape in the state.

Right now that landscape is very bumpy, given the bad economy, severe legal services funding shortages, the high unemployment rate and the soaring number of foreclosures. "In our current economic climate, legal services providers are being inundated with requests for help and have fewer resources with which to respond,"reports Goldsmith. "Pro bono lawyers may be the only hope for many vulnerable or disadvantaged people throughout our state, many of whom have never before faced such dire circumstances."

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Those poor people losing their retirements, houses, savings, and forced into debt all because of massive corporate fraud and no justice to recover it-----THAT IS WHAT TRANS PACIFIC TRADE PACT (TPP) IS ALL ABOUT---- there is no public justice with global corporate tribunals say Ivy League schools behind the 1%!


If you audited the money Maryland sends for this pro-bono work and for legal aid you will see that nothing is done with money that either ends up in other projects or are simply pocketed by people offering little or no help.  I went to legal aid in Baltimore and found them handing my instruction forms telling me what I could do for myself because they do not go to court with you.  Now, I am a pretty sharp cookie and often go to court as my own legal representative but I know the courts are not friendly to people seeking to represent themselves.  So, having an agency that simply informs people how the system works do nothing for these people.  ANOTHER DEAD END!  WHAT PUBLIC JUSTICE YOU SAY!!!


The reason formerly middle-class people are clients of these private firms is that public justice that should have protected them is silent.  DOUG GANSLER IS THAT FACE AND HE NOW HAS A WAR CHEST FOR GOVERNOR FROM THE VERY PEOPLE FLEECING MARYLAND CITIZENS.  He should be up for aiding and abetting crime and he is running for governor!
  The lawyers colluding with the banks and corporations committing these frauds are now deciding which pro-bono cases to take.

THIS IS WHAT THIRD WORLD SOCIETY LOOKS LIKE-----AFGHANISTAN HAS NOTHING ON MARYLAND FOR FRAUD AND CORRUPTION.


Clients are up, funding is down for free legal aid

October 24, 2011 at 7:23 am
By Barbara Pash
Barbara@MarylandReporter.com

As the economy has slowed, the demand for free civil legal services has risen, but funding for those services has not increased.

Pro Bono Resource Center of Maryland logo“The situation is dire,” said Sharon Goldsmith, executive director of the Pro Bono Resource Center of Maryland. “The programs are feeling stretched beyond their limits. The funding is not there.”

The center — the pro bono arm of the Maryland Bar Association serving as a clearinghouse for lawyers’ volunteer services — is a statewide nonprofit entity. Nowadays, Goldsmith said, center volunteers are seeing “a lot” of formerly middle-income people who would not have qualified for free legal help before. This is “a whole new group of people” asking for help, she said, in addition to the low-income people already being served.

Demand rising

The center Groups providing free legal assistance served nearly 140,000 clients in fiscal 2011, 9% more than 2010. But during that same period, over 44,000 people seeking legal help were turned away for a variety of reasons like being a criminal, rather than a civil, case; over the income eligibility limit;  and not enough staff people and resources.

The Pro Bono Resource Center spearheaded coordination of volunteer legal services for the foreclosure prevention project, a 2008 state-wide initiative to deal with the home mortgage crisis. In 2010, the project was expanded to include mediation but the center continued to play a role in training attorneys and coordinating public workshops around the state.

In fiscal 2010, state and federal grants to the Maryland foreclosure mediation program amounted to $700,000; in fiscal 2011, the figure was $509,000 because of funding drops.

Although the number of foreclosure filings in court subsequently slowed down., since January 2011 they have begun to increase. “I doubt we will see an increase in funding,” said Goldsmith, who credits lawyers with stepping up their pro bono activity to compensate.

3,000 attorneys volunteer


Maryland Volunteer lawyer Services logoAt Maryland Volunteer Lawyers Service, the demand for legal services rose 6% from fiscal 2010 to 2011, straining the approximately 3,000 attorneys who donate their time there.

Many of the lawyers who work with MVLS are in solo practices or small firms. Their ability to volunteer is being limited by their need to earn billable hours, said Richard Chambers, deputy director. Many are also changing careers, Chambers said. In the last three years, the number of attorneys taking cases has decreased 20%, although other volunteers have picked up the slack, he said.

MVLS has boosted its private fundraising among corporations and law firms, whose support now accounts for 40% of its budget.

“We’d love to expand our phone intake. We’d love to have more outreach to the lower Eastern Shore, to St. Mary’s and Frederick counties. We can’t do it. We are at capacity” for clients, said Chambers. “We know there are probably thousands of people who qualify for our services.”

Too many clients, too few chairs

Maryland legal aid logoAt Maryland Legal Aid, the jump in clients is apparent “in our lobby any morning,” said Wilhelm Joseph, executive director.

“We used to add chairs as the room got full,” Joseph said. “Now, we don’t have enough chairs for all the people looking for help.”

The private nonprofit law firm saw nearly 70,000 clients in 2011, versus 62,000 in 2010 and 42,000 in 2006.  Legal Aid also now has a broader client demographic, which now includes “the former working class and the middle-class,” Joseph characterized. “They’ve been out of jobs for several months and are facing issues like getting unemployment and food stamps, and mortgage foreclosure.”

Since 2008, Legal Aid has seen default on debt and wage garnishment cases rise 30%. Unemployment insurance cases are up 153%. Public assistance cases are up 156%, and food stamp cases have increased 72%. In the same time period, the number of cases where Legal Aid just gave advice to clients they could not represent — often because Legal Aid was operating at capacity — has risen 28%.

Legal Aid’s annual budget is almost $25 million, with funds from federal and state grants, contracts with local jurisdictions through state agencies, and private sources. While funding has risen steadily over the years, the situation overall “is getting worse,” said Joseph.

“There is increased demand, funding is getting much more difficult, and operating costs go up,” he said.

Maryland Legal Services Corporation logoSusan Erlichman is executive director of Maryland Legal Services Corporation, whose annual budget of about $16 million is distributed to 35 programs around the state.

The corporation’s major funding sources are, by statue, interest on lawyer trust accounts and court filing fee surcharges. It also receives a small amount from the state abandoned property fund.

Though the corporation’s major funding sources are set by statute, its funds have decreased with the economy. From 2009 to 2011, trust account interest revenue fell from $7 million to $2 million — about 70%, Erlichman said.

In 2010, the General Assembly increased the court fee surcharge at MLSC’s request. The new income filled the interest funding hole.

“Without the increased surcharge, the whole legal services delivery system in the state would be in danger of collapse,” said Erlichman.

Nonetheless, the increased surcharge is scheduled to sunset in 2013, and she and others in the legal services community are doing what they can to ensure it continues. “It would leave us in a devastating situation,” said Erlichman.

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Now, I have spoken about Barbara Mikulski and her role on the Senate Appropriations Committee in funding or not the budgets of justice agencies and as I have said the budget at the Federal level has never been smaller at a time of extreme corporate fraud against the US Treasury and American people.  She manages to get plenty of corporate welfare to the rich in Maryland but cannot get that funding for public justice even when democrats had a super-majority in 2009.

Below you see the same in Maryland.  As billions of dollars in Maryland are lost to fraud we just cannot seem to fund the agencies of public justice to recover that fraud.


SHEILA PUGH IS THE FACE OF THIS CRONYISM AND YET SHE IS NEVER CHALLENGED IN BALTIMORE.  SEE WHY MIKE MILLER LET'S HER PLAY THESE REINDEER GAMES!!!!

This is where all law that protects corporations from public justice happen as well.


Appointed by Senate President:
Thomas M. Middleton, Chair (410) 841-3616, (301) 858-3616
John C. Astle, Vice-Chair (410) 841-3578, (301) 858-3578

David R. Brinkley
Brian J. Feldman
Barry Glassman
Delores G. Kelley
Allan H. Kittleman
Katherine A. Klausmeier
James N. Mathias, Jr.
Catherine E. Pugh
Victor R. Ramirez

SENATE STANDING COMMITTEES FINANCE COMMITTEE

ORIGIN & FUNCTIONS The Finance Committee started in December 1831. Originally, it bore responsibility for reviewing all bills concerned with fiscal matters. In 1975, the review of budgetary and tax matters was assigned to a separate committee - the Budget and Taxation Committee.
Miller Senate Office Building, 11 Bladen St., Annapolis, Maryland, December 2003. Photo by Diane F. Evartt.


Legislation relating to banks and other financial institutions; commercial law, including consumer protection; credit regulation and consumer financing; economic and community development; and health and welfare matters is considered by the Committee. Bills concerned with horse racing and lotteries; insurance; labor and employment; State personnel issues; social programs; transportation; unemployment insurance; utility regulation; and workers' compensation also are reviewed by the Committee. The Committee has eleven members (Senate Rules 18; Code State Government Article, secs. 2-1103 through 2-1105).




Below you see why McFadden being challenged was a big deal for Mike Miller in keeping public justice out of the loop in Maryland Assembly.  He and Jones-Rodwell are on this committee because they are dedicated to keeping public justice away.  I'm not sure McFadden's challenger will be much better sadly as he is as crony.

It is the combination of Washington suburbs pols and the Baltimore City pols where most of the fraud and wealth from fraud go that give the state this completely third world crony system.


A governor can shout that these committees are not working in the public interest in funding and writing laws.  A government that protects wealth and profit are not working in the public interest and defunding public justice violates the US Constitution.
____________________________________________

Below you see Heather Mizeur on the Appropriations Committee where all of the policy that sends money to corporate welfare start.  This is why she supports public private partnerships and Wall Street credit bond leverage deals----she works for corporate welfare.  She was placed on this committee because she will tow the line.  At the same time this is where defunding of public justice occurs and is replaced by this idea of private pro-bono as public justice.  Note that Mary Washington------Johns Hopkins pol where all of state funding ends-----is on the Appropriations Committee too!

Now, the citizens of Maryland will have a hard time shaking all of the neo-liberal bugs from the rug at once, but the governor is the one that should be shouting that these committees and agencies are not working in the public interest and in fact much of these funding bills could be challenged in courts as not in the public interest.  This is how a first world democracy works.

When I asked Mary Washington to define fraud in the Maryland Assembly after the economic crash in 2008 caused by massive corporate fraud of which her employer, Johns Hopkins was a major recipient----she said-----OH, I DON'T THINK THEY WOULD WANT THAT!  OH, REALLY????? WHO ARE 'THEY' MARY?


THESE NEO-LIBERALS ARE NOT WARM AND FUZZY-----RUN AND VOTE FOR LABOR AND JUSTICE IN ALL PRIMARIES!

Appointed by House Speaker:
Norman H. Conway, Chair (410) 841-3407, (301) 858-3407
James E. Proctor, Jr., Vice-Chair (410) 841-3083, (301) 858-3083 Steven J. Arentz
Gail H. Bates
Wendell R. Beitzel
John L. Bohanan, Jr.
Steven J. DeBoy, Sr.
Adelaide C. Eckardt
Tawanna P. Gaines
Melony G. Griffith
Ana Sol Gutierrez
Guy J. Guzzone
Keith E. Haynes
Mary-Dulany James
Adrienne A. Jones
Tony McConkey
Heather R. Mizeur
Barbara A. Robinson
Theodore J. Sophocleus
Nancy R. Stocksdale
Kathy Szeliga
Mary L. Washington
John F. Wood, Jr.
Craig J. Zucker



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SENATE STANDING COMMITTEES BUDGET & TAXATION COMMITTEE
Origin & Functions

Subcommittees

Miller Senate Office Building entrance, 11 Bladen St., Annapolis, Maryland, January 2014. Photo by Diane F. Evartt.


Appointed by Senate President:
Edward J. Kasemeyer, Chair (410) 841-3653, (301) 858-3653
Nathaniel J. McFadden, Vice-Chair (410) 841-3165, (301) 858-3165

Richard F. Colburn
Ulysses Currie
James E. DeGrange, Sr.
George C. Edwards
Joseph M. Getty
Verna L. Jones-Rodwell
Nancy J. King
Richard S. Madaleno, Jr.
Roger Manno
Douglas J. J. Peters
James N. Robey
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April 01st, 2014

4/1/2014

0 Comments

 
MARYLAND IS HANDING ALL THAT IS PUBLIC TO PRIVATE HANDS AS ALL PUBLIC SECTOR OVERSIGHT AND REGULATIONS AND ALL PUBLIC JUSTICE IS ELIMINATED.  AFTER ALL----TRANS PACIFIC TRADE PACT---TPP ----IS ALL ABOUT ENDING US SOVEREIGNTY AND HAVING GLOBAL CORPORATIONS WRITE LAWS AND PROVIDE THE OVERSIGHT THEY WANT.

THIS IS MUNICIPAL DEBT FRAUD AS ALL INVOLVED KNOW THE US ECONOMY IS READY TO IMPLODE FROM MUNICIPAL AND SOVEREIGN DEBT EXTREME LEVERAGING.

Public private partnerships are the neo-liberal way of privatizing all that is public while making the public pay for all the cost of corporate operation.  While republicans call it socialist to hide the fact that it is naked capitalism, neo-liberal pols like O'Malley and Rawlings-Blake pretend its all about job creation and development.  From waterfront property to public parks, to school playgrounds and public community centers and health care----all of it is disappearing under the auspices of public-private partnership.

I asked a minister who attended a protest in Annapolis where the nearest public library was......we were at the State Capital.  She had to take a minute to think about where the nearest public space in Annapolis not a government building would be-----ALL THE WAY OUT WEST STREET AT THE CITY'S BORDER.

People need to WAKE UP because neo-liberals and neo-cons are working together to end all existence of public space.  As when the USSR was taken private during PERESTROIKA with all of its publicly owned spaces and businesses handed to a few private Oligarchs in this new Russia-----

THIS PRIVATIZATION OF ALL THAT IS PUBLIC BY NEO-LIBERALS IN THE MARYLAND ASSEMBLY AND CITY HALL IS THE SAME AS THIS RUSSIAN PERESTROIKA.

They are taking public land and setting private businesses on this land all so these businesses will not pay property tax.  That private business sitting on that land will control that property.  Baltimore and Maryland is ground zero for this PERESTROIKA of the 1% as fraud and corruption goes wild and a free-for-all with public assets has Wall Street investment firms already owing the citizens of Maryland hundreds of billions of dollars in fraud-----taking all of our wealth a second time around.

Heather Mizeur said in an forum for Governor of Maryland that in order to create jobs trades-people should give up some of their pensions in order to fund school building.  This is the same labor/union busting in these deals.  CAN YOU IMAGINE A CANDIDATE RUNNING AS A PROGRESSIVE WANTING A WORKING CLASS PERSON TO GIVE UP PENSION MONEY TO BUILD AND BE SILENT ON CORPORATE FRAUD AND CORRUPTION?  That is because Heather Mizeur is not a progressive ------she is a corporate poser who will do the same as O'Malley, Brown, and Gansler in handing all wealth to the top!


STOP ELECTING THESE SAME NEO-LIBERALS WHO ARE KILLING OUR DEMOCRACY!

Below you see articles showing this growing wealth divide as all costs of doing business for global corporations are now being thrust on the public.  We start with Dan Rodricks who works for these developers but does make a good point every now and then.

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Dan makes a good point in shouting that the Trusts meant to build MD's environmental strengths are gutted and underfunded seeming more of a shell operation than money designated for a specific use. Think Transportation/Innovation Trusts. What we don't hear from MD media enough is the outing of O'Malley and MD pols for progressive posing; pretending to support issues that are environmental or labor and justice and then ignoring them if they are passed. MD media has given the world's worst environmentalist headlines for his national campaign meant to sell him as an environmentalist and none of it is true as this one example shows.

US media was free press until a decade or so and had as a mission to hold power accountable and now they work hard providing the headlines and the campaign snippets to hide the facts. The truth with open space is that in Baltimore all public property is being handed to private developers right and left and all areas designated as public are really private campuses built with public money. The entire Inner Harbor is now privately owned with the public designated for costs.

Then take the scam of preserving farms with estate tax reduction where the rich pretend to have a working farm to have huge estates that could be 10 real working farms. MD is far from sustainable or environmental because it has no democratic party.



Marylanders need to speak up for open space A program designed to save trees and farms under constant legislative attack


Gunpowder Falls State Park (Sun photo by Dan Rodricks / April 1, 2014)

Dan Rodricks 5:00 a.m. EDT, April 1, 2014  Baltimore Sun

When I have a hard time understanding government spending — the construction and tinkering that goes into, say, Maryland's multibillion-dollar annual budget — I just imagine the whole thing as a kitchen-table conversation with members of a household declaring and negotiating priorities. (Pardon the time-worn metaphor, but it works for me.)

After we cover the big-ticket items (health, education, roads, public safety, the mandatory areas of spending), we get around to the other pieces of the budget that need to be maintained — public employee pensions, for instance — and arguments break out about obligations, fiscal discipline and not "kicking the can down the road." It can get rough, even ugly.

But after the dust settles and everyone's exhausted, someone at the far end of the table, who has waited her turn to speak, reminds us about a certain obligation: One half of one percent of all transfer taxes paid at real estate closings must be set aside for protection of land against future development; that's state law.

In Maryland, it's called Program Open Space. It was established in 1969 with bipartisan support, and for good reason: The legislators of that time saw massive development coming to the state's suburbs, and they wanted to preserve farms and acquire land for public parks and playgrounds to keep things in balance — Maryland as "the land of pleasant living" even as it became a huge bedroom for Washington and Baltimore.

With white flight from the cities, the construction of the interstate highway system and two beltways, environmentalists and lawmakers saw Maryland's potential to become an utter mess as population grew and development spread.

Forty-five years along, we pride ourselves on being a state that still boasts postcard vistas from the Eastern Shore and the Chesapeake to the mountains of Garrett County, with a lot of nice spots in between.

The $2 billion that went into Program Open Space has a lot to do with that. It's a smart program, a legacy of Maryland's progressive approach to conservation, built on a simple idea:

Take a tiny piece of the revenue from each real estate transaction and fund a program to save open space — buy development rights from Maryland's family farmers so they can keep farming, acquire land for state parks, and send money to Baltimore and our smaller cities and the counties so they can build playgrounds, bike trails and lacrosse and soccer fields.

The logic is beautiful.

Because Program Open Space is tied to real estate transactions — only 0.5 percent of transfer taxes go into the fund — it tracks with the economy. If development and house sales slow, so does Program Open Space. In better times, when there's more action in commercial and residential real estate, more money goes into land preservation.

But the wise lawmakers who established the program are gone, and their political descendants have raided the fund countless times — to the tune of about $1.5 billion, according to calculations by the nonprofit Partners for Open Space — and they did this most famously during the savings-and-loan mess of the mid-1980s.

Annapolis has scoffed repeatedly at the spirit of the law that established Program Open Space with little worry about political fallout.

That last part is what gets me. That's why I'm writing about this today. The muldoons in Annapolis are messing with Program Open Space again. In his new budget, Gov. Martin O'Malley designates no cash for the program, using instead a more complicated system of bonds to finance specific projects, while some in the General Assembly want to cap the fund at $100 million. (Yeah, baby, time to rein in all that wild spending going on for open space!)

In the program's original form, there was never supposed to be a cap; Porogram Open Space was supposed to try and balance land gobbled up for development with land conserved for farms, forests and local parks and playing fields, all through a tiny fraction of the revenue from each real estate transaction.

Partners for Open Space says there are 150 Maryland farm families lined up for the state's agricultural preservation program, but not enough money to handle the demand because of Annapolis's constant raiding of Program Open Space.

Doing a budget — in a household or for the entire state — requires many skills, discipline and adherence to principles, including respect for an established rule.

In this case, here's the rule: We will devote 0.5 percent to a fund to acquire land, and it will be tied to income from a specific source; we won't be obligated to put any additional money into that fund but, at the same time, we won't raid it for the general budget, either.

In violating the spirit of Program Open Space, Annapolis counts on Marylanders not caring enough about grass and trees to bother them with phone calls and emails. And if that happens, then in time maybe they'll think it's OK to just end the program altogether.

We can't let that happen. We need to take a stand for open space, and now.


_______________________________________
In Baltimore, city buses and fire department engines are being covered with corporate advertisement because when corporations pay no taxes the public coffers are empty.  So, all across the city public parks and athletic courts are left in disrepair or closed because UnderArmour is allowed to get tax breaks.  Yet, public work is outsourced to allow UnderArmour to 'donate' money to repair a park for 'free' courtesy permanent corporate advertising.

So, no public employees maintaining parks and recreation and the city's public spaces littered with corporate tags all paying for corporate operations with a dash of tax relief to maximize profits------


THAT'S A NEO-LIBERAL/NEO CON FOR YOU----ALWAYS WORKING TO HAVE THE PUBLIC PAY TO MAXIMIZE PROFIT!

Jul 13, 2011, 2:33pm EDT Updated: Jul 28, 2011, 7:08am EDT

Under Armour to renovate Federal Hill court


 Scott Dance, Staff Baltimore has hired Under Armour Inc. to renovate a basketball court at Federal Hill Park at no cost — other than some brand advertising.

The Tide Point-based sportswear maker has agreed to replace the chain-link fence around the court and install a new playing surface, goals and goal posts. The city is not paying Under Armour for the work, but is allowing it to include its logo on the court surface. The city Board of Estimates approved the deal Wednesday morning.

It’s not the first time Under Armor has emblazoned its logo on city property. The city and company caught flak from residents in April 2010 for an Under Armour ad painted on the grass of Federal Hill Park, facing the Inner Harbor with the company’s logo and slogan “Protect this house”. Under Armour also has its logo on a baseball field in Locust Point, near its headquarters. That field is not city-owned, according to City Councilman Bill Cole.


____________________________________________
O'Malley and neo-liberals and neo-cons are working hard to hand all of Maryland's public land to private gain and as we see below, a great big State Center complex is now giving businesses an opportunity to operate without paying property tax because after all its public land.  So, instead of rehabbing this building for the much needed rebuilding of public oversight and regulation and hiring thousands of public employees to do this, O'Malley is taking this public space private subsidizing costs of taxes and maintenance for what is almost always global corporate chain stores.

The jobs created are poverty while the state public jobs that are middle-class are slowly eliminated because after all-----Trans Pacific Trade Pact gives Global Corporate Tribunals and legal teams all the functions of today's public sector.
  Keep in mind that another public-private partnership with O'Malley is the Hilton Hotel now having the public subsidize corporate loses, no tax revenue coming in, and employees fleeced of money and paid poverty wages.  City Hall sold that project just as they are selling this State Center project that will end up the same.  This State Center has been left to deteriorate and the thousands of state employees earning strong wages have be culled as all oversight and regulation has been eliminated in Maryland.

IT IS ALL PUBLIC MALFEASANCE AS IT HAS NO INTENT TO OPERATE IN THE PUBLIC GOOD.


GET RID OF ALL PUBLIC SPACE BY HANDING THEM TO PRIVATE CORPORATIONS SAY NEO-LIBERALS LIKE O'MALLEY!  PUBLIC HOUSING REAL ESTATE BECOMING A PUBLIC PARK OR PUBLIC COMMUNITY CENTER?  NOT ON MY WATCH----IT WILL BE PUBLIC LAND USED FOR AN AFFLUENT PRIVATE HIGH-RISE!


THIS IS THE UGLIEST, BRUTAL, MOST OBSCENE ABUSE OF PUBLIC TRUST I HAVE EVER SEEN.

Governor O'Malley Unveils Plans for First Phase of State Center Redevelopment Phase One of redevelopment to create new office and retail near transit hub and support 1,200 construction jobs and attract another 800 permanent jobs in the heart of Baltimore City


BALTIMORE, MD (July 27, 2010) –

Joined by local officials, construction workers, community leaders and others today, Governor Martin O’Malley announced plans for the first phase of the landmark State Center redevelopment project in the heart of Baltimore City.  Pending Board of Public Works approval tomorrow, the State will lease 500,000 square feet of newly developed office space in the first of two new buildings to be built on the 28-acre site by a state-selected private development team.  The five-phase, 15-year redevelopment is the culmination of six years of planning, and is expected to bring nearly 10,000 jobs during the construction phase and more than 5,400 permanent, private-sector jobs to the heart of Baltimore City when the project is complete, in addition to more than 4,800 indirect and induced jobs upon the project’s completion.

“This is the beginning of an ambitious public-private partnership that will transform a stagnant, government office complex into a vibrant, walkable, ‘green space’ that will link nine surrounding communities, revitalize a key part of Baltimore City, and bring thousands of private-sector jobs to the heart of Baltimore,” said Governor O’Malley.  “The state commitment to lease office space opens the door for the development team to seek the private funding necessary to build the project, a project that will assist Maryland’s economic recovery by supporting jobs and attracting new business to the area with work beginning this fall.”

The entire State Center redevelopment, a five-phase, 15-year plan, will create 9,403 jobs during construction and 5,439 permanent, private-sector jobs when the project is complete.  An additional 4,862 indirect and induced jobs will be added upon the project’s completion.

“The O’Malley-Brown administration has been focused like a laser on job creation in Baltimore and throughout Maryland,” Mayor Rawlings-Blake said. “The State Center redevelopment is a tremendous opportunity for Baltimore, providing more job opportunities and new investment.  The City of Baltimore will continue to work in strong partnership with the State to move this exciting project forward.”

The State Center redevelopment transforms an out-dated, 28-acre concrete complex valued at $1.8 million into multi-million dollar retail, commercial and residential transportation oriented development where the State is projected to be $144 million in the black by year 20.  This is made possible by the use of the public private partnership which includes a projected $28 million in parking revenue, $30 million in ground rents and shared profits, and $160 million in new state taxes over the first 20 years of the project.

Phase One of State Center Redevelopment

The $215 million Phase One development at State Center will include two new office buildings and a parking garage.  In addition to the 500,000 square feet of office space, the two buildings combined will include 70,000 square feet of street-level retail space, including a grocery store that the has been a priority for the surrounding communities for years.  In addition to the 1,200 jobs supported by construction of Phase One, the project, when complete, will attract another 800 permanent jobs to the State Center site. 


Over the next 20 years the first phase of the State Center redevelopment will generate more than $200 million in state and city taxes and another $30 million in lease payments to the State of Maryland.  Phase One will Support 1,200 construction jobs and attract 800 permanent, private-sector direct jobs. 


Phase One will construction two office buildings and a parking garage where a parking lot currently sits, creating 500,000 square feet of office space and 70,000 square feet of retail space, including a grocery store.

“This milestone follows three years of intensive planning, research and community involvement,” said Caroline Moore, Chief Executive Officer of Ekistics, LLC and the managing member of the private development team.  “We have worked hand-in-hand with citizens and both state and city government to develop a concept that meets the various needs of the community and we have done it in award-winning fashion.”

Currently, State Center is home to four state government office buildings and 3,500 state employees, the largest concentration of state employees in Maryland.  However, the layout of the existing complex hinders the ability of residents to move between the nine surrounding communities.  The redevelopment of State Center will create a more pedestrian friendly environment, consolidating 14 state agencies and more than 3,500 state employees, in addition to employees and customers of added retail and commercial space, in a complex sits at the intersection of six different public transportation systems.

In May 2010, the overall $1.5 billion State Center redevelopment project received a Charter Award from the Congress on New Urbanism as one of the seven best urban smart growth projects in the world.  The 28-acre State Center site will be redeveloped in five phases over fifteen years converting the property from an underutilized government owned and operated office campus into a mix of privately owned and operated office, retail and mixed income residential units, forming a green, walkable community adjacent to Metro, Light Rail and MARC transit stations.

The State Center redevelopment project is a transit oriented development that reflects the goals of Governor O’Malley’s Smart, Green and Growing initiative.  Introduced in October 2008, the Smart, Green & Growing initiative was created to strengthen the state’s leadership role in fostering smarter, more sustainable growth and inspire action among all Marylanders to achieve a more sustainable future. The initiative brings together state agencies, local governments, businesses and citizens to create more livable communities, improve transportation options, reduce the state’s carbon footprint, support resource based industry, invest in green technologies, preserve valuable resource lands and restore the health of the Chesapeake Bay.

State Center is the second major public-private partnership to move forward under Governor O’Malley in the past year.  In November 2009, the State agreed to lease operation of Seagirt Marine terminal at the Port of Baltimore to Ports America Chesapeake.  The State maintains ownership of Seagirt while day to day operations and capital investments are now the responsibility of Ports America Chesapeake.  As part of the agreement, Ports America Chesapeake is now constructing a new 50-foot berth at Seagirt using private funds.  The new berth is critical to the future success of the Port of Baltimore as an expansion of the Panama Canal will bring larger ships to the US East Coast when completed in 2014.  In total, the Seagirt agreement will support 5,700 jobs.




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Baltimore is a city of crumbling infrastructure and schools closing because of decades of neglect in maintenance but we do have a Wall Street copy at Harbor East complete with plated sidewalk fixtures and a billion-dollar East Baltimore Hopkins Corporation campus all heavily funded with public money.

Public docks, public Port of Baltimore, and public land surrounding the harbor are all falling to public private partnerships that have the public paying for and maintaining infrastructure built for these corporate office campuses.  As this article shows, the money put forward in these developments offer little value to the city and as has happened in other cities-----like Detroit-----these development schemes based on global corporate businesses fall flat in all ways.

  • The mayor is quoted below promoting what everyone knows is not true about these developments---new jobs, new tax revenue---new amenities.

The entire development process is designed so that little tax revenue is paid and if it is the tax stays right around this development.  The jobs are abusive and poverty with government watchdogs saying that the Inner Harbor has lost over 100,000 jobs in these few decades along with all small business vendors pushed out of business to make way for global corporations that make all American cities look the same.  Tourists come to Baltimore to see the same businesses they have in their cities?  I THINK NOT. 

The comparison of Baltimore to Detroit is valid.  Building debt until the city goes bankrupt is a business model for Wall Street.


Harbor Point: Do we really need $80 million in bells and whistles? Opinion: The East Baltimore project is front-loaded with city-funded projects that needn't be started now.

Gerald Neily June 7, 2013 at 10:20 am

Artist’s rendering of Harbor Point, a $1 billion project that’s due to receive a hefty city subsidy.

Photo by: City of Baltimore


The press release issued this week by the Rawlings-Blake administration to justify its $107 million financing plan for Harbor Point presses all the usual buttons: “Like the Inner Harbor revitalization effort of 30 years ago, the Harbor Point project represents a once-in-a-generation opportunity to grow Baltimore by attracting new jobs, new residents, new tax revenue, and new public amenities.”

But Harbor Point is nothing like the Inner Harbor. The latter was a gaping hole of abandoned piers and obsolete factories that needed to be filled, while Harbor Point is extraordinarily isolated from the rest of the city.

The press release promises “blight elimination.” But there is no blight to eliminate at this former site of a chromium-processing factory.

Harbor Point is literally a blank canvas, covered by an asphalt cap to contain buried factory wastes. Unlike most of Baltimore, everything at this 28-acre site is under control – and unoccupied by people or roadways or infrastructure that need to be cleared away.

Which means we don’t have to spend public money on its redevelopment until we’re good and ready.


Direct Public Money to Real Needs

Let me explain: only a relatively small amount of the proposed public financing is going for traditional infrastructure.


The mayor proposes just $23 million in TIF (tax increment) bonds for sidewalks, utilities and a bridge connecting Harbor Point with Harbor East, but well over half ($59 million) for five parks.

Parks are nice (though one wonders how many non-Harbor Point residents and office workers will use them). Let’s, though, build them when development justifies them.

Another $21 million is for the waterfront promenade. The press release misstates that the “promenade will connect Fells Point with Harbor East.” Wrong. The best pedestrian connection between those places already exists along Lancaster and/or Caroline Street.

Michael Beatty (left) listens to Mayor Rawlings-Blake extol his project at press conference yesterday. The conference was held on the cleared site, with the Harbor East skylight as a backdrop. (Photo by Mark Reutter)

The Harbor Point promenade will be a free-standing amenity that should be built when conditions warrant – not to fulfill some kind of perceived pedestrian demand or to add value for high-rent private office buildings.


Let’s Not Get Ahead of Development

So $80 million of the $107 million spending can be triggered by real-time reality, starting with the completion of the Exelon Tower, which the energy giant has committed itself to leasing regardless of what the city spends on parks and promenades.

The developer, Michael Beatty and his longtime financial benefactor, John Paterakis, are gambling on public subsidies to fill the gap between their ambitions and market reality.

Another rendering of the proposed development, biggest in Baltimore history. (Harbor Point Development)


The same game was played at their previous project, Harbor East, when the city allowed itself to pay for public improvements far ahead of  development (as well as subsidize with tax breaks the development itself).

The Harbor East promenade was torn up for the Four Seasons complex, and the walkway still hasn’t been rebuilt right.

On the other hand,  Morgan Stanley is currently occupying the Thames Street Wharf building – the only part of Harbor Point that’s been completed – without any public complaints about the lack of surrounding amenities.


Grand Plans Foiled Before


The city’s experience with the Harbor View development in South Baltimore is a perfect illustration of the problem of “front-loading” public assets onto private projects.

Back in the 1980s, Richard Swirnow planned a whole wall of high-rise residential buildings along Key Highway, which was approved by the city over the objections of a mostly enraged community.

Only one was actually built. The high-end waterfront residential market became oversaturated and the rest of the site was slowly built-out as townhouses.


With Harbor Point, the stakes would be much higher. The mayor’s press release summarizes a jigsaw puzzle of financial considerations with a bottom line of dubious accounting legitimacy: “average new City revenue per year (30 years), $19,623,928.”

This metric sweeps away the city’s recent history of development projects that have failed to meet their hype with a single word: “average.”

Another Detroit?

Perhaps the most comparable development plan to Harbor Point is Renaissance Center in Detroit. It, too, was hyped as Detroit’s savior, but was really just a massive isolated urban ego-trip that sapped all the city’s high-end development demand.

Detroit’s showcase Renaissance Center has unintended consequences for Motor City’s old downtown.

RenCen’s chronic vacancy eventually compelled General Motors to move its corporate headquarters there on its road to eventual bankruptcy and government bailout.

Harbor Point is better designed but equally isolated, with far poorer access and a far greater infrastructure budget.

RenCen took advantage of Detroit’s once powerful corporate sector – and then helped destroy that sector.

Aren’t There Higher Priorities?


Baltimore should be in no hurry to complete the promenade or stamp out alleged Harbor Point “blight.”

Instead, the mainstream development market should be encouraged to build up the Central Avenue corridor to Old Town, or to fill up vacant and underutilized downtown office buildings, or to turn around areas that are truly blighted like Westport and Poppleton.

There are plenty of needy neighborhoods and stalled projects that the mayor should address before throwing public money at what she described yesterday as one of the best real estate locations on the East Coast.

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    Cindy Walsh is a lifelong political activist and academic living in Baltimore, Maryland.

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