Congo forces leaders to pay taxes – ours?

The Democratic Republic of Congo, faced with a fiscal crisis, is now forcing their leaders to pay taxes. Reuters reports

Amid a growing budget shortfall, the government is under pressure to cut costs and boost tax revenues.

Budget Minister Michel Lokola told Reuters that last month’s decision to tax government salaries at source, rather than rely on employees to pay taxes after receiving their salaries, had already raised roughly $1 million.

“They just weren’t paying. The government ministers we replaced, the MPs, the senators, they didn’t pay,” said Lokola, who entered the government last October in a cabinet shake-up that saw his predecessor Adolphe Muzito named prime minister.

Lokola said the move was partly aimed at setting a good example, adding that Congolese President Joseph Kabila’s government salary was also subject to the measure.

“He is aware of this, and he approves of it … I don’t see how we can expect the private sector to pay their taxes if we don’t pay ourselves,” he said.

So even a country we look upon with derision, the Congo, has realized the benefit of taxing the elite of their country. As we have seen, politicians in this country appear to have an aversion to paying their taxes, and can’t even comprehend the tax code that they wrote, as evidenced by Tom Daschle, who didn’t know the limo was taxable.

So will Geithner, considering the fiscal crisis we, ourselves, are facing, implement a program of ferreting out government tax cheats and garnishing their taxpayer-paid wages?

I doubt it.

He’s a tax cheat.

Nothing like the fox guarding the hen house.

Clinton blames America’s drug users for Mexico’s drug war

The Latin American Herald Tribune quotes Clinton as saying,

“Our insatiable demand for illegal drugs fuels the drug trade,” Clinton told reporters earlier en route to Mexico. “Our inability to prevent weapons from being illegally smuggled across the border to arm these criminals causes the deaths of police officers, soldiers and civilians.”

She vowed that we would work “side by side” with Mexico to eradicate the traffickers, who Clinton referred to as “gangs.”

John McCain (R-AZ) called the problem an “existential threat,” and Joe Lieberman ((D-CT)  deemed “unacceptable” the fact that not all of the $700 million appropriated for equipment and training for the Mexican security forces has been distributed.

In the meantime, the Organized Drug Enforcement Task Force (ODETF), has said that though meth labs are declining in the .S. due to restriction of ingredients, meth use is rising due to increased distribution efforts of the Mexican Drug Cartels, termed DTO’s (Drug Trafficking Organizations), by the ODETF, who are suppling the Hispanic gangs as well as their own people throughout the country.

Clinton’s perspective, mirroring Mexico’s, that drug use is the cause of this war, is neglecting basic supply and demand laws. Demand tends to influence price, not necessarily use of a product.

The automakers said Americans wanted SUV’s and that’s why they sold them. But if they hadn’t engineered them, would we have even known it was possible to demand them?

If you had one grocery store in your neighborhood, you would go there. If they shut down, would you continue to go there and demand food?

I think not, and I think it would get you nowhere. Yet we Americans, who can’t stop smoking pot or doing meth or coke, are to blame for this problem.

Why is this different? In Mexico. both political parties are accusing each other of being in the pocket of the cartels. Mexico has had a known corruption problem for years and years. Their army is on the payroll, their prosecutors, their police, etc.

And we want to give them money for Blackhawk helicopters and arms and training?

If they legalized it, and kept it in line with current prices, would we still have this problem? Would the drug lords of Mexico and Columbia, still have a black market?

Or would they trade in their AK47s for pens and ride the legal wave to wealth and happiness while we grow our way out of our current economic problem?

I would guess the latter.

CEO of drug enterprise busted in Winnetka – updated

Yes, the darlings of Winnetka have done it again. a mere two blocks from New Trier High School, the training ground for the future CEO’s of America, an enterprising 21 year old, Mark Elliot Mansheim, was arrested Wednesday and charged with “production of marijuana plants, marijuana possession and manufacture of marijuana, all felonies,” according to the Chicago Tribune.

Officers executed the search warrant on the home about 3:45 p.m. Wednesday and found 75 marijuana plants “and further evidence of the production, use and distribution of [marijuana],” the release said. Also found in the home, according to the release, were growing stations, including tents equipped with lighting, irrigation and ventilation systems.

This was a breaking news story. When they get around to investigating further, like, for example, why this kid has a setup like this in his house and his parents weren’t arrested too, they will find more interesting information.

The house has been transferring hands nearly every year since 2003 when it was bought by Evelyn A. Liberis for $770,000 and quit claimed to 384 Hawthorne LLC for $0.00 in 2003, and then quit claimed and mortgaged nearly every year between Evelyn, 384 Hawthorne LLC, multiple banks,  Thomas and Melissa  Mansheim, who bought it from 384 Hawthorne LLC for $2.57 million in 2006, Steven and Constance Fapka (who took out a $1.5 million mortgage in 2008 while the Mansheim’s owned it) and somehow it ended up back with the LLC and corrected to show the Mansheim’s as owners.

The LLC lists Lloyd Gussis as the agent and the principal office as 1101 Fisher Lane in Winnetka. The managers are Kasey Tamara, Leslie Struthers and, you got it, Evelyn A. Liberis.

Makes you wonder if young Mark may be taking the fall for  what would seem to be a criminal enterprise involving Mom, Dad and who knows who these other people are.

Lovely living in the North Shore. Great neighbors. Wonderful place to raise your kids.

The newpaper’s forums are betting he gets 100 hours of community service.

I’d have the FBI investigate the whole enterprise. I’d bet it doesn’t stop there.

Wilmette Police press release

****Update****

A poster, dotherightthing, has this first hand account to offer.

first of all it wasn’t 75 plants. It was 4 plants and 71 germinated–which is basically the seed in soil. People are making it sound like he had a forest growing in his basement.

Always good to hear both sides of the story. You decide.

Clinton, Rubin and Summers, Graham, Leach and Bliley – thank you

In the early 1900’s, commercial banks began to establish security affiliates that floated bond issues and underwrote corporate stock issues. (In underwriting, a bank guarantees to furnish a definite sum of money by a definite date to a business or government entity in return for an issue of bonds or stock.)

Then the stock market crashed.

In 1930 the Bank of the United States failed, reportedly because of activities of its security affiliates that created artificial conditions in the market, FDR closed the banks for four days, 4000 failed permanently, and Congress created the Glass-Steagall Act of 1932, then amended it in the Banking Act of 1933.

The act forced a separation of commercial and investment banks by preventing commercial banks from underwriting securities, with the exception of U.S. Treasury and federal agency securities, and municipal and state general obligation securities.

More specifically, the act authorizes Federal Reserve banks to use government obligations and commercial paper as collateral for their note issues, in order to encourage expansion of the currency. Banks can also offer advisory services regarding investments for their customers, as well as buy and sell securities for their customers. However, information gained from providing such services cannot be used by a bank when it acts as a lender.

Likewise, investment banks cannot engage in the business of receiving deposits.

A bank is defined as an institution organized under the laws of the United States, any state of the United States, the District of Columbia, any territory of the United States, Puerto Rico, Guam, American Samoa, or the Virgin Islands, that both accepts demand deposits (deposits that the depositor may withdraw by check or similar means for payment to third parties or others) and is engaged in the business of making commercial loans (12 U.S.C.A. § 1841 (c)(1) [1988]).

Investment banking consists mostly of securities underwriting and related activities; making a market in securities; and setting up corporate mergers, acquisitions, and restructuring. Investment banking also includes services provided by brokers or dealers in transactions in the secondary market. A secondary market is one where securities are bought and sold subsequent to their original issuance.

It also created the Federal Deposit Insurance Corporation (FDIC) to protect depositors in the future.

The Act was passed because it was largely believed, after hearings in Congress, that commercial banks were being too speculative in the pre-Depression era, not only because they were investing their assets but also because they were buying new issues for resale to the public. Thus, banks became greedy, taking on huge risks in the hope of even bigger rewards. Banking itself became sloppy and objectives became blurred. Unsound loans were issued to companies in which the bank had invested, and clients would be encouraged to invest in those same stocks.

Enter the Clinton Era and the Graham-Leach-Bliley Act of 1999, the act which ultimately repealed the Glass-Steagull Act. The final bi-partisan version passed in the Senate 90-8-1 and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999, though most of his Democratic colleagues voted against it, initially (Senate 54-44, House 343-86).

The Graham-Leach-Bliley Act sought to “modernize” financial services–that is, end regulations that prevented the merger of banks, stock brokerage companies, and insurance companies. It nullified all prior acts that strictly regulated those who stored your money such as the Bank Holding Company Act that prohibited a bank from controlling a non-bank company which passed in 1956 and the 1982 amendment that further forbid banks from conducting general insurance underwriting or agency activities.

Why is this related to today? According to the Online Law Encylopedia,

The expansion of commercial banks into securities underwriting was substantial until the 1929 stock market crash and the subsequent Depression. In 1930 the Bank of the United States failed, reportedly because of activities of its security affiliates that created artificial conditions in the market.

As a result of the bank closings and already devastated economy, public confidence in the U.S. financial structure was low.

Is this sounding at all familiar? It should be.

The Glass-Steagull Act made all of that history, GLBA repealed it and history, my friends, is repeating itself.

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Fast forward to October 2011 – With unemployment remaining steadily at over 9 percent for the last several years, foreclosures at an all time high and banks squeezing the dimes out of people with fees for everything but walking in the door, groups around the country are occupying financial districts, parks, banks and anywhere they believe they will have an impact. In New York occupiers shut down the Brooklyn Bridge and in Chicago they have been camped out for a couple of weeks on a corner that conveniently houses the Board of Trade, the Federal Reserve Bank of Chicago and Bank of America down the street. A recent rally joined by four other groups including several labor unions, shut down Monroe Street between Michigan and Columbus — ironically on Columbus Day.

Sources GLBA, Glass-Steagull(1), Glass-Steagull(2)

A criminal conspiracy by any other name…

I stumbled today, on the stock broker fraud blog which apparently keeps track of all the dirt on Wall Street. After reading an article about former UBS Securities LLC Executive Director Mitchell Guttenberg, who was ordered to “forfeit $15.81 million in alleged illegal profits, as well as serve 78 months in prison” for an insider trading scheme, which also involved UBS stock analysts, a trader, a hedge fund manager, and other individuals, I wondered, why does the RICO Act not apply here?

According to this article, Guttenberg and the 12 other individuals, “mostly former employees at Morgan Stanley, Bank of America Corp, and Bear Stearns Co., Inc., were criminally charged for their involvement in the insider trading ring. Investigators say the participants tried to conceal their illegal actions by conducting meetings at restaurants, using disposable cellular phones, and coming up with coded text messages.”

Are they drug dealers or traders? To some people, money is a drug. In this case, it should be treated as such.

Were they throwaway phones, or were they stupid enough to use their own?

But it gets better.

Another article, concerning Auction-Rate- Securities, involved 12 states which banded together to form a “multi-state Task Force dedicated to finding out whether Wall Street investment firms had misled investors when persuading them to invest in the ARS market.”

I anxiously read on to see how much jail time these people would do, and discovered the answer was zero.

The punishment for this crime that involved 12 states? “11 major Wall Street investment banks have said they will buy back over $51 billion in ARS from charities, retail investors, and small companies.”

And the list of these companies, with their ARS hotlines?

Bank of America 1-866-638-4183
Deutsche Bank 1-866-926-1437
Citi 1-866-720-4802
JP Morgan 1-866-450-8470
Goldman Sachs 1-888-350-2857
Merrill Lynch 1-888-706-1381
UBS 1-800-253-1974
Morgan Stanley 1-800-566-2273
Wachovia 1-866-283-794

That was in November 2008. When did they get the first of the TARP money, and their bonuses, and their huge salaries?

Are they on the UBS list of unnamed offshore accounts?

And on the same site:

UBS Financial Services, Inc., UBS Securities, LLC, and Citigroup have reached finalized settlements with the Securities and Exchange Commission to pay tens of thousands of ARS investors almost $30 billion. The settlements will resolve SEC charges that the companies misled investors about the risks involved with auction rate securities.

The SEC’s complaint accused UBS and Citigroup of misleading customers by telling them ARS were liquid, safe investments and failing to warn them of the growing dangers when the market started to fail. When the ARS market froze in February, the SEC says both firms left tens of thousands of clients holding billions of dollars in illiquid ARS.

These finalized settlements will restore about $22.7 billion in liquidity to UBS clients who invested in ARS and some $7 billion to Citigroup investors. SEC Chairman Christopher Cox says investors will get back “100 cents on the dollar on their ARS investments.” Both firms will buy ARS from affected customers at PAR. Customers that sold their ARS under the par difference will be paid between par and the ARS sale price. This is the largest settlement in SEC history.

That was December 22, 2008……and the TARP money?

We as taxpayers, should demand equal protection under the law. They should be charged with the criminal conspiracy that this truly is and sent to prison – 20 years to life, with their assets seized and put into the TARP Rebate Fund.

No wonder they needed that TARP money to be spent so rapidly and with no accounting for where it went. No, it wasn’t spent on bonuses, IT WAS SPENT TO PAY BACK THE THOUSANDS OF PEOPLE THEY DEFRAUDED!!

And Geithner, the tax cheat, was in on that deal.

He should resign. They should all be investigated for criminal conspiracies, the whole financial sector, but most especially, the members of the Too-Big-to-Fail-Club.

They seem to be the worst offenders.

Addendum. I don’t know that this is where the money was spent, but if they didn’t loan it out, and they didn’t spend it on bonuses….well, it’s a good bet.