Author Archives: Jason Pye

You can’t own property in California

Property rights took a hit in California yesterday:

Voters in California yesterday overwhelmingly supported Proposition 99, a ballot measure that will significantly empower state and local officials to seize private property via eminent domain, and rejected Proposition 98, which would have protected property rights and ended rent control. As legal scholar Ilya Somin noted in the Los Angeles Times, Proposition 99, though masquerading as a defense of private property, was actually sponsored by groups representing counties, cities, and other redevelopment interests who drafted it specifically to counter Proposition 98. Among other crimes, Proposition 99 will protect only owner-occupied residences from condemnation, leaving apartment buildings and other rental properties wide open for abuse.
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Proposition 98, on the other hand, would have placed significant limits on such abuse. But while that might have gone over with the voters, ending rent control was far less popular, even though the law would only affect rent controlled apartments once they became vacant, thus leaving current tenants unaffected. Gov. Arnold Schwarzenegger came out against Prop. 98, however, claiming it “would undermine California’s ability to improve our infrastructure.”

For someone who claims to have been influenced by Milton Friedman and witnessed the evils of socialism in Europe, he certainly has take a sharp turn to the left since becoming Governor of California.

Post-Debate Press Conference

Stephen and I attended the post-debate press conference last night where candidates fielded questions from media and bloggers. Stephen asked a question to the candidates about pardoning non-violent drug offenders.

The video is divided into two parts. The first is Mike Gravel. He was in the room before the other candidates and kind of took over the podium and took several questions. LP Media Communication Director Andrew Davis politely asked him to let other candidates come up and take questions and Gravel cocked an attitude. I’m not faulting Gravel, but he could have handled it better.

Here is Gravel:

Here is the second part of the press conference video. This has all of the candidates answering questions from the media:

“PATRIOT” Act used against Spitzer

It was indeed the so-called PATRIOT Act that brought Elliot Spitzer down:

When Congress passed the Patriot Act in the aftermath of the 9/11 attacks, law-enforcement agencies hailed it as a powerful tool to help track down the confederates of Osama bin Laden. No one expected it would end up helping to snag the likes of Eliot Spitzer. The odd connection between the antiterror law and Spitzer’s trysts with call girls illustrates how laws enacted for one purpose often end up being used very differently once they’re on the books.

The Patriot Act gave the FBI new powers to snoop on suspected terrorists. In the fine print were provisions that gave the Treasury Department authority to demand more information from banks about their customers’ financial transactions. Congress wanted to help the Feds identify terrorist money launderers. But Treasury went further. It issued stringent new regulations that required banks themselves to look for unusual transactions (such as odd patterns of cash withdrawals or wire transfers) and submit SARs—Suspicious Activity Reports—to the government. Facing potentially stiff penalties if they didn’t comply, banks and other financial institutions installed sophisticated software to detect anomalies among millions of daily transactions. They began ranking the risk levels of their customers—on a scale of zero to 100—based on complex formulas that included the credit rating, assets and profession of the account holder.
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The new scrutiny resulted in an explosion of SARs, from 204,915 in 2001 to 1.23 million last year. The data, stored in an IRS computer in Detroit, are accessible by law-enforcement agencies nationwide. “Terrorism has virtually nothing to do with it,” says Peter Djinis, a former top Treasury lawyer. “The vast majority of SARs filed today involve garden-variety forms of white-collar crime.” Federal prosecutors around the country routinely scour the SARs for potential leads.

One of those leads led to Spitzer. Last summer New York’s North Fork Bank, where Spitzer had an account, filed a SAR about unusual money transfers he had made, say law-enforcement and industry sources who asked not to be identified because of the sensitivity of the probe. One of the sources tells NEWSWEEK that Spitzer wasn’t flagged because of his public position. Instead, the governor called attention to himself by asking the bank to transfer money in someone else’s name. (A North Fork spokesperson says the bank does not discuss its customers.) The SAR was not itself evidence that Spitzer had committed a crime. But it made the Feds curious enough to follow the money.

I’m glad to see that the PATRIOT Act is being used to stop such crimes so detrimental to the national security interests of the United States.

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