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Tuesday, December 31, 2013

Homeless Gangs Stab Several Insde New York's Port Authority Bus Terminal

Tonight, a fight inside Port Authority Bus Terminal just hours before the New Year sent three people to the hospital with injuries and one person has "life-threatening injuries" from the fight which sent passersby inside the terminal scurrying into Terminal restrooms's to hide. 

The real scandal involving the Port Authority of New York and New Jersey is not whether some politically-appointed minions of New Jersey Governor Chris Christie decided to intentionally reduce ingress lanes from Fort Lee, NJ to the George Washington Bridge as some sort of political punishment. 

It isn't even the Port Authority's decision to give millions of dollars to a certain landlocked New Jersey city which has no known connection to the Port of New York or to any PANYNJ facility. (I've checked.)  Those millions of dollars, incidentally, were granted on the heels of one of several toll hikes on poor bridge and tunnel commuters.

No, the real scandal is the deteriorating environment inside the midtown Port Authority Bus Terminal.  This is something readers of this blog have known since I've been covering it since at least late 2010. 

Tonight, the latest violence inside the Terminal involved fights between "groups of homeless men" which sent at least three to the hospital with stab wounds.  One victim is described as having life-threatening injuries. This was mere hours before the ball drop in Times Square, and while thousands of commuters were disembarking from buses arriving at the terminal and presumably bringing in partygoers to enjoy the festivities.

What a great advertisement for Bill de Blasio's New York (he gets sworn in shortly as the new Mayor)!   

Monday, December 16, 2013

Birth Certificate Sex Change Is Document Fraud

A proposed bill working its way through the New Jersey State Legislature would revise the history of transgendered people, allowing their birth certificates to reflect their after-acquired (that is, their new) gender.

This is revisionist history; in fact, it is worse. It is document fraud and is not appropriate.

Official documents must be sacrosanct.  The lack of credibility or ease of forgery causes numerous headaches for the victims of identity fraud and other crimes.  Such crimes are the ostensible reason why native American citizens born in Puerto Rico must provide more forms of identification than other native-born citizens, because birth certificates from the Commonwealth of Puerto Rico (an American possession since 1898) are so rampantly forged that they are no longer recognized as official, genuine government identification.

How does this affect transgendereds? The New Jersey bill would allow transgendered people the right to get new birth certificates to reflect their new gender.  The problem is that this entire process reflects, indeed it requires, recognition of both the gender of the person at birth and the person's new (that is, for the moment) gender. (Now in an age of sex-change operations, hormonal therapies and the like, gender can be changed as often as one wishes and can afford to pay for it.)

But what is a birth certificate? Is it not a document that identifies who you were at a defined moment -- at birth? Is it not a document that establishes, for example, where you were born?  Does that permanent fact -- a historical fact -- not entitle you to the rights and privileges of citizenship?

If you were born a male, your birth certificate reflects that historical fact, the fact that existed at the time of birth.

If you are an American, native-born, your birth certificate reflects that.

If you wish to change into a woman, there are all sorts of legal recognitions of your newly-acquired gender of which you can avail yourself.  You can get a current government ID stating, for example, that you are a female.  Steven can become Stephanie, or vice versa. 

What horrors might be unleashed by permitting the backdating of official records to reflect not what was a fact, but what you now wish was a fact way back when?

Do foreigners now get to change their birth certificates to reflect an American birthplace years ago, well, because they just wish it so?  

Or is the real meaning behind this bill the push to make nothing permanent, to remove the true meaning from anything and to give fearsome powers to government bureaucrats to change things as they see fit?




Thursday, December 5, 2013

Back to the Future: Bill Bratton Nominated For New NYPD Commissioner

Breaking news -- Incoming New York City Mayor Bill DeBlasio (nee Wilhelm) will reportedly nominate former Police Commissioner William Bratton to a return gig in the position.

Bratton was originally nominated by former Mayor Rudolph Giuliani in 1994 and is widely credited with implementing the "broken windows" theory of crime prevention.

This corner believes this move is made with one eye towards reassuring both the police rank-and-file (i.e., your beat cop on the street) and the business community that the crime reduction achievements of the past 20 years will not be allowed to disintegrate.



The Danger of Increasing Executive Branch Power

The concentration of government power in one branch -- whether at the federal or any state or county level -- was recognized by the framers of the Constitution as a danger to our Republic.  This week, noted constitutional law professor Jonathan Turley in his testimony before a House committee very aptly pointed out the dangers of this trend.  Best of all, Turley was intellectually honest in calling out both the Bush (44) and Obama Administrations for this trend.


Wednesday, December 4, 2013

Public Pensions and Public Sector Envy

In my experience, almost no one seeks to work for "the government" because they want to get rich. They want public sector work because they view it as relatively stable; some do like the idea of public service or working in their small town.  Others will take a public sector job to gain experience and leverage that into subsequent, rather lucrative private sector employment; prosecutors and top regulators come to mind.  But very few, very few indeed, think it's the path to riches.

That's why the recent Detroit bankruptcy court decision paving the road for potentially sharp haircuts on retirees' pension payouts -- treating pension plans just like any other contract and pensioners like any other creditor, when creditors typically get hammered in bankruptcy court -- is causing so much distress among the public sector crowd.

The private and public sectors just don't understand each other.  Very few truly cross from one side to another.  Those that do make the jump most often make a permanent move in search of a better income or prospects (and this move is almost always to the private sector).  The back-and-forth revolving door from the private sector to the government is rare, but is most often seen among the management / executive set.  The revolving door is often decried as symptomatic of the crony capitalism that is increasingly recognized.  But among the rank-and-file in both worlds, very few understand how green the grass is on the other side.  In reality, both sides fail to realize that the green grass is often painted green.

Here's the reality check for the public sector.  Private sector employees and small business owners face immediate financial pressures. A small business owner can "do well" one year but have total exposure and the potential for total destruction of his income stream the next year.  Public employees -- being virtually unfireable -- don't have any concept of the level of risk and lack of security this means.  They look at the highest possible salaries one can have in the private world and say, "boy, all these guys are rich."  Yes, private workers can always go to infinity, and that is the tradeoff for having no security.  This -- the rebalancing of the risk-reward tradeoff to reduce potential rewards while increasing risks (through legal liabilities, other laws' costs and taxes) explains the visceral objections among the private sector ownership class to the income redistributionist rhetoric coming out of government these days. 

On the other hand, private sector employees almost universally refused to consider public sector work because of the relatively low salaries, the low level of the highest-possible salary (such as the GS-15 level which caps sitting United States Attorneys at an annual salary of about $160,000) and other constraints like the Hatch Act which can preclude political activity while on one's own time. 

The years-long economic decline has made some people look wistfully at the public sector because they think about job security and presumed income security (but at a lower level).  This is not necessarily true and reflects the distortion in perceptions caused by the sharp 2008-09 recession and subsequent stagnation.  The private sector does not realize that most public employees are paid modestly and one of the tradeoffs for that lower salary is the pension plan.  The private sector, now demonized, does not understand the dilemma.  

The progressives vilifying the private sector may find very little sympathy from private business owners who resent being bitten by government workers they used to feed and still feed.  The victims here will be those public employee retirees who played by the rules and were let down by fiscally irresponsible government leaders who ran up too much debt without the ability to repay it.  There is no easy solution to make solvent these insolvent pension plans, not without higher taxes on the private sector whose resentment of the public sector has been more than earned.  Unfortunately, many low-paid government retirees stand to become little more than disposable cannon fodder for "progressive" politicians who used them for votes, ran up debts without regard for the ultimate responsibility, and then threw these retirees away like so much rubbish. 






Wednesday, November 27, 2013

New IRS Regulations Target Nonprofits' Issue Advocacy

Must you be willing to be subject to reprisal, boycotts and social disapproval from political opponents as the price for political speech?

Yes, according to proposed new Internal Revenue Service regulations that would move us towards a regime where your right to political speech is conditioned on others being able to know who you are and where you live and work.

The ability to anonymously fund issue advocacy and political speech (even if not directly related to any campaign) without having your name publicly disclosed will become virtually impossible if these new regulations that will be formally published Friday are enacted.

(For those of you seeking legal guidance, bring your checkbook and form a line to the right.)

So-called Section 501(c)(4) organizations have been able to engage in certain political speech (not within proximity of an election) as "social welfare" groups and enjoy tax exempt status on their income.  The catch is that they must not be primarily engaged in political activity.  The new regulations would expand the definition of several terms in order to reach much more political activity. Organizations that evaluate judicial nominees might not be able to remain under the Section 501(c)(4) exemption, for example.  

This is moving towards content-based regulations targeting certain speech. That phrase has been used by federal courts when ruling certain laws, regulations and ordinances unconstitutional, usually as violations of the Equal Protection Clause. To flesh out my original thoughts, the new proposed regulations dramatically expand the definitions of "candidate" to include any government nominee or appointee -- so criticizing a judicial nomination or Cabinet nominee is verboten! The regulations would exclude political speech from "social welfare" (which is the permitted use for a (c)(4) org), but the danger is that relatively benign, nonpartisan issue advocacy -- such as criticism of a government policy -- can potentially run afoul of the IRS or any politically overzealous examiner. 

The new regulations are disappointing, because the IRS recently tried to solve the problem of uneven or inconsistent fact-based investigations and evaluations of (c)(4) groups with a new mid-2013 guideline of sorts that used a 60/40 rule.  Under special guidelines, a handful of groups applying for (c)(4) status were allowed to receive recognition under that section of the tax law if they certified that the group's time and monetary expenditures on political activity were less than 40% of the group's total time and money spent on all activities.  Why such a baseline (or even a lower threshold like 80/20) could not be used in the proposed rules now is a mystery, unless the unspoken bureaucratic intent is to really deter such activity at all. 

If the regulations are enacted (probably in early 2015 after the public comment period ends), the result will be that any organization that wishes to engage in anything but the blandest (and thus meaningless) issue advocacy will have its (c)(4) exemption status in jeopardy and may be treated under the tax code as a "527" or other organization.  This is like telling the cook of a five-star restaurant he can only cook oatmeal.  That way, the regulators can avoid being accused of shutting down the place, but by so restricting the choice of meals they will drive away customers and eventually shut it down by destroying its revenue stream.  The means are different, but the end -- shutting it down -- remains.  When the government has the ethos that the end justifies any means, this is what you can expect.

What else can we expect? Perhaps we will have inventive ways to obey the letter of these regulations, with the use of allegory.  Alas, only a sliver of the population is apt to "get it."  After all, how many people get the meaning of George Orwell's "Animal Farm"?

What's the relevance? Any other non-(c)(4) treatment means the organization must disclose its donors. You see, you can still engage in political speech and criticize government policies or the government itself.  That is the letter of the regulations -- i.e, the law.  But the spirit of the regulations is what is concerning.  The spirit -- and very much the catch -- is that under the new proposed regulations, you will have to disclose your name, address and occupation.  The better for your opponents to harass and boycott you.  

This is what's called a chilling effect on political speech.  And that is very much the point.

Eric Dixon is an attorney handling regulatory, corporate and select litigation matters for business, political and individual clients in New York and New Jersey.  Nothing here is intended as legal advice.  He can be reached at edixon@NYBusinessCounsel.com. 

Friday, November 22, 2013

The Obamacare Subsidy Trap

UPDATE: The post below was picked up and republished Tuesday morning by RealClearMarkets.com at http://www.realclearmarkets.com/research_reports/ under the title "Obamacare Could Turn Millions Into Criminals."

Obamacare may create a new wave -- maybe millions -- of criminals consisting of the poor and the poorly-educated.  This analysis I have published through the Financial Policy Council explains more.


Saturday, November 16, 2013

Jonathan Martin's NFL Career Is Over

Workplace bullying is a problem -- nothing new about that, either -- but the story of Miami Dolphins player Jonathan Martin makes a mockery of true victims of workplace intimidation and sexual harassment.

Martin claims that bullying by a Dolphins teammate has forced him to retire from the game of professional football.  The counterclaim is that the teammate (and others) were just trying to toughen up Martin for the occupation he chose -- and for which there are undoubtedly thousands of other men who would be willing to endure abject public humiliation for the opportunity to replace Martin and at a fraction of the salary Martin was receiving.

Let's make a few points clear.  Although this is an era where the proper lines are rarely drawn, lines separating proper from improper, workplace from therapist's couch, private matter from broadcasting "too much information" from Oprah's couch, we need to draw lines and bold ones at that.

The workplace is a sacred place.  It is a place for work.  Sports lockerrooms are no different -- sports are about achievement, about results, and those who do not achieve results (winning) are soon gone.  People who interfere with the workplace objective get fired and behavior in the workplace which undermines group harmony (the concept of "works and plays well with others" or "fitting in") is criticized, discouraged or outright prohibited.

However, the current controversy has drawn in a lot of attention. That indicates there are much larger issues than that of football players not getting along. The Martin controversy is just one scene in a much bigger drama which attempts to undermine and destroy the results-oriented, achievement-driven nature of all competition, of capitalism itself, and ultimately to attack and subjugate the men who are considered evil for creating that construct. 

Cultural elitists and emasculators deride sports as just a game, as in a game for kids.  That is a subtle way of trying to emasculate the men playing them by implying they really are men-children or boys playing a child's game and thus are not adults, they certainly are not mature, henceforth they are not worth the respect accorded or earned by, well, real adults. (A movie analogy comes to mind: The derisive term "man-animal" used by the condescending character played by John Travolta in an obscure movie called Battlefield Earth.)

These people (no, not the man-animals, I'm talking about the cultural elitists, the Ivy League snobs, the ones who profess to only watch PBS, listen to National Public Radio and read The New York Times) refuse to accept professional and even collegiate sports as legitimate businesses, because they wish to attack and destroy the concept of achievement and specifically of male achievement.  This is nothing less than an attempt to reorder the entire concept of achievement, of worth, and even of gender roles.  It is a stone thrown in the battle to define men punitively and solely along the terms favorable to women (and certain women at that, mind you), terms defined by women and used only by women.

The Jonathan Martin whine-fest is an opportunity for this crowd to undermine the achievement aspect of not only sports, but any institution created, inspired or run by men. This is an attack on business, on capitalism, on any male hierarchy which prizes achievement as measured by objective metrics like, well, winning.  The strategy in this assault on the Y chromosome is to attack the cultural and fraternal ties that lead to effective and often winning, if not championship, teamwork. 

The supervillain in this hysterical drama is Martin's "tormentor," teammate and Miami Dolphins lineman Richie Incognito.  Mr. Incognito has become the quick stand-in to signify all that the man-haters hate about men. All the hatred, all the venom, all the vengeance, all the pain women have felt, all of this is being directed at Incognito -- who is privately assuredly gaining in stature by holding firm on this issue of just trying to motivate an underperforming co-worker.

I will predict that the so-calling bullying by the villainous, horrible man is nothing more than a teammate trying to improve the productivity of another teammate not quite pulling his weight. The object here is to win, to achieve, and for heavens' sake we cannot have that, hence the attacks on Incognito for being a terrible bully. To be clear, the object being to win, to improve production, and bullying is counterproductive in that it clearly reduces performance.  But bullying is also not about performance enhancement; it is about control, domination and causing the suffering of its victim.  None of those objectives appear to be at work here.  Instead, this seems to be a contrived claim by an underperformer who needed an escape hatch and is now seeking to capitalize on victim status.

Whatever Martin is claiming Incognito said or did, the object was about producing winning and it seems Jonathan Martin was at least perceived as not being anywhere near close to tough enough to survive in an environment where men are paid six-figure and seven-figure salaries to go to near-literal war each weekend -- and where all of this is funded by fans who are not paying thousands of dollars for season tickets to watch the politically correct hold hands, eat Quinoa burgers and sing "Kumbaya."  Whether the politically correct police like it or not, mental toughness and, yes, the ability to withstand verbal abuse from opponents on the battlefield (er, the football field), are not desirable attributes; they are necessary qualities to survive in the occupation of professional football.  The trash-talking in professional sports is not incidental; it is often a critical feature of the contest.  Players seek to annoy their opponents to gain a mental advantage.  Anything to win.  And someone with a known weakness for a thin skin will become a huge target for abuse, not because of cruelty but because the stakes are very high.

Achievement and results are paramount.  What Martin is trying to do is, indirectly, to attack and destroy the results-oriented end game of all of capitalism, of all competition.  His claim to victim status also rests on flawed logic which, if accepted, would wreak havoc on our society as we know it.

First, it implies that all competitors (indeed, everyone) is entitled to perform in the field of their choosing.  Simply stated, this means anyone who wants to run onto the field at the Super Bowl has a right to do so! Ergo, the objects of my desire, my fantasies, become my rights.  That is fine for the utopians, who ignore the true nature of a right as something inalienable and not infringing on the rights of another.  Instead, the "Martin rights" require others to bear the burden of his self-declared right. If Johnny wants his victory lap, by golly, we are obliged to give it to him. (Cue up Lady Gaga's "Applause.")

By this tortured and defective logic, what protection would our laws afford the object of obsessive desire?  Would our laws allow, or mandate, that the poor sap who finds himself the target of desire of a Genevieve Sabourin (just sentenced to prison for stalking Alec Baldwin) must submit to her?  What would be the limit? Would there even be limits?

What is missing here, folks? It is the simple concept that achievement is earned.  You want that promotion, you have to work for it. You want to win the Super Bowl? You have to work really hard -- and work in tandem with your teammates -- to even get close to it.

The audacity of Jonathan Martin is the demand, not spoken necessarily but implied, to revise the rules and requirements of the occupation to suit his eggshell-skull sensitivities.  It is narcissism gone mad on the sports field.  I want to be a winner, therefore I am a winner, and how dare you question me otherwise! But Martin has no right to receive special treatment; no one does.  No one has the right to a desired outcome, not in a free society.  Jonathan Martin is not the Pharaoh.  Jonathan Martin is not, ahem, special.

The PC police would have you believe the thin-skinned player is a victim. I consider that player the weakest link, the vulnerable player who is almost certain to be targeted by the opposition also trying very hard to win. Martin must be considered unsuited for professional football and his NFL career should by all rights be over. It should be, if there is justice and respect left for the concept of objective achievement. Maybe some team executive will be pressured into signing him.  But don't expect his new teammates to embrace him.  Jonathan Martin is not tough enough to take professional sports -- and may not be tough enough to take many workplace environments, for that matter.  Worse, by demanding special treatment, he disrespects his teammates who have been held to -- and achieved -- a higher standard.

In an environment where winning is paramount, pressure is high and individual financial rewards are also high, Jonathan Martin's presence is now likely to undermine group harmony and the teamwork necessary for high achievement in pressure-packed situations. Martin is simply a man not likely to help a team win.  

There are thousands of players who would gladly sacrifice bodily functions and future health -- many have made those sacrifices, knowingly, for decades -- for a shot at the National Football League.  Almost every current NFL player has buddies who didn't make the cut.  Don't expect any of them to welcome Jonathan Martin with open arms.

Martin is no victim.  He is exploiting his failure under a cloak of victimhood.  I'd bet he already planned his second career -- perhaps as a commentator on the aggression in sports -- before he disqualified himself from his first career. That's right, I think this is all contrived, all plotted out.  I'm telling you readers out there not to be suckered into the sob story.

Jonathan Martin was a failure. There is no shame in not being able to "cut it" in the National Football League.  But the attempt to cash in on weakness and contrived victim status should be greeted with deep cynicism and rejection.

From here on out, Martin should get from the sports world the reaction which he has earned.

Indifference.

Eric Dixon is a New York City-based attorney and consultant who handles matters in New York and New Jersey.





Wednesday, November 6, 2013

Serious Cracks in Christie's Premise of Electability

We've been hearing for years how larger than life approval ratings indicated that New Jersey Governor Chris Christie (a/k/a, the Big 4-5) was electable, that he would be the type of Republican "who could win" nationally.

Ummmmm. Not so fast, fellas.

The preliminary numbers show that:

* Christie barely got more votes this year in a two-person race -- preliminary numbers are about 65,000 more -- than he got in a three-way race in 2009 to first win as Governor. Compare his 2013 vote total of 1,242,568 with 99% reporting (caution: all numbers are preliminary until certified) to his 2009 certified vote total of 1,174,445.  Christie's numbers barely budged -- his vote totals may be 5% higher than four years ago. That's it.

*  The aggregate vote totals in the 2009 and 2013 gubernatorial elections show that overall votes were down this year, about 10% down from 2009. If voters are excited about a candidate, whether or not he (she) has national prospects, voter turnout goes --- up. The common wisdom was that voters in 2009 were angry about incumbent Jon Corzine, but take this year; do you honestly suggest voters in 2013 are not angry about --- Obamacare?  (Yes, that's a federal issue, the governor's race is a state issue, but most voters don't split those hairs.) 

If Christie was getting "crossover" support or building support from new constituencies (read: Latinos), overall voter interest, vote total numbers, all of those metrics go up.  But as explained above, Christie's vote totals barely nudged higher. (And now New Jersey has early voting by mail, which enhances rather than suppresses voter turnout, so scratch that excuse.)  Overall voter sentiment might be expressed with one word: Meh. Indifference is not a sign of voter excitement or coalition-building or a shift in the political tectonic plates. 

The bottom line:  Declining numbers are never evidence of voter enthusiasm. (Well, some delusional Republican fundraisers might disagree, but that's desperation talking more than intellectual honesty.)

* Christie has barely any coattail effect. The GOP appears to have picked up all of one legislative seat in the entire state.

* Arguably, Christie has negative coattail effects among Democrats, and especially among -- gasp! -- the aforementioned Latinos.  The very premise of Christie being a break-the-mold candidate shakes if not disintegrates upon looking at the evidence.

Exhibit A for this phenomenon is the heavily Hispanic Hudson County city of Union City, in which its State Senator (and Mayor) Brian Stack (D-33rd District) appears to have suffered a victory margin that shrank by about 10% this year running with the very explicit and oft-repeated endorsement of Governor Christie than he did in his last general election for State Senate in 2011. (Note: Raw vote totals are up this year, 2013 being a gubernatorial top of the ticket year whereas 2011 had State Senate at the top of the ticket; turnout, however, lifts all boats so percentage of the vote indicates the presence, or absence, of coattail support.)

Taken together, these facts undermine (and certainly do not establish) that Christie "runs well" with Hispanics or Democrats. The inability to build on vote totals from four years ago in a clear-shot general election is more of an indication that the support level of the opponent crashed.  That fact by itself would make Christie's vote percentages increase, even with his support plateauing, because the denominator (that being aggregate votes cast for all candidates) would shrink.  Hence, as long as you're just taking the headline percentage and not digging further, Christie would "appear" to gain more Democratic vote-share and Hispanic vote-share.  But just like with federal government statistics on unemployment, you have to drill down into the results, look at historical trends.  The Christie spin-meisters and GOP establishment already preparing fundraising solicitations don't want you to do this. Here's why:

When the down-ticket results for people running with or endorsed by Christie show that their actual 2013 vote percentage margins of victory declined against their last general election.  The aforementioned Stack is Exhibit A.  There will be more.

COME BACK FOR UPDATES THIS WEEK AS MORE RESULTS ARE MADE AVAILABLE AND ARE ANALYZED.

Friday, November 1, 2013

New York City Marathon: What To Expect Sunday

Eric Dixon is a veteran 10-time marathoner (personal best: 3:34) who declined to run the 2014 New York Marathon to protest the New York Road Runners' initial decision to run the race after Hurricane Sandy despite relief efforts occurring virtually alongside the race route.  Mr. Dixon much prefers the Philadelphia Marathon and Long Island Marathon and is scheduled to run both (this month and next May, respectively). Forget the "experts." Here is candid advice from someone who's actually run the race...and ended up in the hospital one year as a result!

While the New York City Marathon is a challenging course for the most experienced world-class runners, weather conditions for this Sunday's 2013 New York City Marathon will be especially difficult for all competitors.

Let me stop holding you in suspense: All but the fastest runners should expect significantly slower times Sunday due to the wind. Taking five percent off your goal time should be a good expectation (that means a three-hour racer should expect to run about 10 minutes slower; a four-hour racer, about 12 to 15 minutes slower).

First, the weather. The temperature forecast has been steadily dropping all week, and now the official National Weather Service forecast is for highs Sunday in the upper 40s.  This would be ideal, except for the wind. A brisk wind of 15 to 20 miles per hour will be blasting runners. Even worse, it will come from the north-northwest.  This means runners will be going into the wind virtually the entire first 20 miles! 

UPDATE: For current National Weather Service forecasts for New York City, click here.  NWS now predicts gusts upwards of 20 miles per hour, mainly from the north, lasting throughout the morning and early afternoon -- right during the Marathon. 

What are the effects of this? Runners will feel much colder, and in fact should dress for conditions in the mid-30s.  In addition, the wind is a factor not just for cutting times and comfort, but also poses a safety hazard.  The wind tunnel effect from the numerous buildings and skyscrapers means runners should expect particle debris and flying debris during the race and will need eye protection. Sunglasses or googles are well-advised.  

As for spectators, you are all fools for standing for hours on the side of the road. (Do what my wife does: she stays home and waits for the 911 call to tell her which hospital I've ended up in!)(Seriously, that did happen one year when it was very humid and I cramped up before the race.) Anyone watching the race in person will be miserable. Even worse, New York City has an open container rule, so you cannot -- repeat, cannot -- get drunk while watching the race in person.  Find a good pub where you can at least relieve yourself in semi-privacy for a few hours.   

Back to the race.  Runners will face immediate discomfort upon starting the race.  The first mile is one mile straight up the Verrazano Narrows Bridge.  This is the longest suspension bridge in the world and so long that its construction and design account for the curvature of the Earth!  Do not be impressed by that fact, for it hurts your time. (See below.)  But much worse for the unsuspecting runner is the tendency of thousands of other runners, with little or no running experience, little or no business running a competitive race of any distance and similarly, no experience holding their water, to urinate off the side of the roadway after the race has begun! Remember I mentioned the wind? That means all that bodily effluent will be blown back into the faces of other runners -- so upon beginning the race you will be covered in sticky urine from absolute bloody strangers!  This is not a factor that contributes to enhanced running times, and it is not a good idea to ever start a marathon sprinting up a one-mile bridge for any reason (hygienic or otherwise). You've been warned. 

Coping mechanisms? Resist the impulse to push these runners off the bridge in a fit of earned anger. Keep going straight ahead. Run at close to the middle of the bridge as possible, so there are always several runners between you and the side of the roadway to get in the path of all aerosolized urine particles. (And do not -- repeat, do not -- show this column to anyone who is meeting you after the race.) 

The Verrazano Narrows Bridge will hurt your time. Use mile one as a warmup to get loose (as your other runners get loose with their fluids).  Don't watch the watch until after mile two which is on the other side of the bridge.  Anticipate running these two miles at least one minute per mile behind your "goal time" or "pace time" for various factors including the arc of the bridge and the crush of the crowd -- another 40,000 runners sharing a race course designed for 10,000 (an excellent reason to avoid the New York race altogether and run Philadelphia instead). 

After the bridge, you are in Brooklyn and headed due north for about seven miles. This is the best part of the race -- friendly crowd, few tourists, real New Yorkers, and a flat and relatively pothole-free course -- and your chance to settle in on your pace.  Find taller runners to run behind so you can use their height as wind resistance, and "draft" behind them. The lessened wind resistance may gain you a few seconds each mile and you'll be thankful for that later on.

In northern Brooklyn, once you are off Fourth Avenue's straightaway and right after you run past the Barclays Center, you start to get into a zigzag of narrowing streets.  This section (the miles 10-13) is also the first point where you should take those energy gels for energy.  Before this point they do little but now you have spent a considerable part of your stored energy.  Take a gel pack but keep the rest for miles 13 and after.  That's when you'll need them. 

If you are on your pace you will already be running past a substantial number of runners who have no idea and no business running a marathon or even a 10-mile race. Don't let this fool you. You are keeping pace, that's all. Now start watching the watch carefully. Fatigue may already set in even in the first half of the race -- even if you've trained properly -- so make sure each mile you are no more than 10-15 seconds behind goal pace. If you fall behind, pump up the intensity right away on the next mile, because the second half of the course is no place to gain time.  

Moving towards the halfway mark of the race, you'll cross a small bridge into Queens.  The course should be opening up for you as stragglers struggling with the distance really start to flag. The downside, however, is that the course becomes much more difficult.

At mile 15 you'll start to move onto the Queensborough (aka Edward I. Koch) Bridge. Another mile up a bridge, and this one is worse than the Verrazano, for while it is shorter and not as high, it is steeper. This is the most serious physical test of the race. Keep moving at all costs, even if you walk.  To stop at this point is to kill any chance at your goal time. And now is the time to have a gel pack since you're not going to be able to run at full speed anyway, not on a steep incline. This will stave off energy depletion which will start to hit you on the Manhattan side of the bridge.

Coming off the bridge, you'll enter First Avenue and the roar of the crowd.  By this time, you'll be covered in a crust of dried liquids of various origin and in no mood to share any emotion with the crowd that can be expressed in a family blog. If you have friends waiting for you on First Avenue, DO have them have a beer (I suggest a can of Guinness) ready for you.  This is serious advice! After two or three hours of running, you do not need more water. You need carbohydrates and beer has that! (And beer is healthier than Gatorade, which I consider nothing but a mix of high fructose corn syrup, water and food coloring.)

On First Avenue you are going up a barely perceptible incline.  Be prepared to have your speed suddenly drop 15-20 seconds per mile. Immediately crank up your engines if that occurs. Watch your watch carefully and look for each mile marker. You are getting close to the "wall" which for humans may feel like a downshift on the transmission.  I have literally felt the wall, knowing the exact moment I've just hit "E" on the meter. It's a wild feeling and it is physical -- it's glycogen depletion -- and knowing that will actually help you cope with the mental side.  By this point, you are in Spanish Harlem and running by steakhouses. Get your mind off the food.  Use your remaining energy gels now -- they won't do you any good after mile 21 or so as you'll be done or close to the finish before you absorb the sugar. Head north past miles 18 and 19.

Crossing into the Bronx and another bridge, you'll now have survived the most grueling six miles I know as a runner. You're approaching mile 20 and now these are a different challenge.  The sun will be going down by this point -- it may be 2pm but the shadows come early in November -- and the cold and wind will mean you'll be feeling cold if you don't keep pace and generate enough heat to compensate for wet clothing (and your clothes will get soaked no matter what wicking material you wear!).  Another reason to keep moving.  If you must stop, you must stay warm and seek shelter immediately.

The Bronx portion is short and you cross back into Manhattan and head south towards Fifth Avenue. There are fewer people now and this can be a grind. Get your last water about mile 22 -- after this the water you take will not be absorbed by your body in time to help you finish -- and then plow through Central Park at miles 23 and thereafter.  Crossing the park is great and these last three miles will be the enjoyment you've been promised.  Trust me, miles 23-26 are easier than miles 13-23.  

Finally, after the race, keep moving as much as possible.  This will keep you from getting stiff. And avoid stairs if at all possible for about two or three days.  But the better conditioned among you will be able to run -- yes, run -- by Wednesday. Trust me. 

When he is not chasing like "60 Minutes'" Mike Wallace after other people, deadbeats or mail carriers, Mr. Dixon is an experienced corporate and regulatory attorney handling cases, investigative matters and sensitive other matters for personal, business and political clients in New York and New Jersey. 

Sunday, October 27, 2013

New York City: Back To The 1980s (Part 2)

For several years I have intermittently reported on a gradual deterioration in New York City street conditions.  The major media is catching on. Today's New York Post reports on an increase in subway panhandling as well as growing public disgust.

One side point: The popular perception is that the crime increase (or crime wave, if you will) is attributable to the recent federal court ruling holding that the City must revise its procedures on the controversial (and effective) stop-and-frisk technique.  I strongly disagree; see my post from earlier this year which pre-dated the court ruling by months. The trend is not months in the making; it is years and it began to show during (but was hidden by) Bloomberg's second term.

The fault line in New York politics is this: Were you here (that is, in New York City itself and not its suburbs) before Rudolph Giuliani's election as Mayor in November 1993?  

I'll bet that question would yield an interesting break in the two-to-one support predicted for Sandinista candidate Bill de Blasio (D-Managua) over insipid Republican candidate and typical ex-bureaucrat Joe Lhota.


The full text of my report from this past spring is below:
If recent crime statistics are an indication (and they are), New York City may be returning to the ugly, pre-Giuliani years of rampant violent crime, when Gotham was less Sex and the City and more The Warriors.  Many Manhattan neighborhoods are seeing alarming spikes in crime, but my reporting will tell you that quality of life crimes or degradations are on an upswing, stats or no stats.
Anecdotal evidence of this retrograde transformation (or deformation) is widespread throughout "good" neighborhoods, in Central Park, City Hall Park, virtually every subway line and every transportation terminal (the exception is the new PATH station downtown).  Belligerent street people -- smelly or evidently deranged (or acting that way on purpose to effect the "pay me to go away" shakedown) -- have returned with a vengeance.  However, this trend has been developing for several years.  For example, the midtown Port Authority bus terminal has had a permanent homeless class since at least 2009 but which has steadily worsened over the last six to nine months.

Eric Dixon is a New York and New Jersey lawyer who grew up in New York City during the Koch and Dinkins Administrations (1978-89; 1990-93). You can guess his preference now.

Friday, October 25, 2013

The Audacity of Failure

My new article, just published by the New York economic think tank Financial Policy Council.  Comments are welcome. 

Friday, October 18, 2013

The Pain of Denying Citizenship By Virtue of Birth

Some American commentators have suggested solving the illegal immigration crisis by outlawing birthright citizenship, i.e., that being born here automatically confers citizenship upon you, because it encourages illegal immigration by allowing "anchor babies" to subsequently sponsor their illegally-entering or visa-overstaying parents and other family members.  These commentators (who are across the political spectrum) should note the injustice (as opposed to the inconvenience) voiced by protestors decrying a new Dominican Republic policy denying citizenship by birthright to Haitians (who share the island of Hispanola).

Readers should consider these major flaws with doing away with birthright citizenship that I explained in 2010.  Unlike other commentators whose focus is on the illegal immigrants, I focus on the risk that longtime Americans would bear under a citizenship-by-government-decree regime. The danger of scrapping birthright citizenship is not in being unfair or dispassionate towards illegal immigrations (as some will charge); rather, the immense risk is jeopardizing the citizenship rights of Americans who have always been here but who may later, tragically, be without an independent means of verifying their own identity and hence their citizenship. 

Monday, October 14, 2013

Cory Booker and Federal Campaign Finance Laws

For anyone watching the special election for Senate in New Jersey, it is NOT news that Newark mayor Cory Booker has completely overwhelmed Republican opponent Steve Lonegan on fundraising.  Booker is a national brand name, a nationally-known rock star who is a viable contender for the 2016 Democratic presidential nomination on name recognition alone.  Add that factor to his fundraising prowess and you'll see why he could be a national contender.

But as for this year, now I will explain why (1) the fundraising advantage is neither as large nor as significant as you think, (2) New York mayor Mike Bloomberg HAD to drop $1 million on a special TV ad buy (and quick, raise your hands if you've seen it -- nah, me neither) -- and (3) Lonegan has a real chance to win despite numerous obstacles

(1) Booker's been raising funds all year. In fact, he started raising funds in 2012 even when the late former Senator Frank Lautenberg was still making public appearances, rather indelicately nudging Lautenberg towards retirement. But note that some of his fundraising solicitations asked for $10,400 instead of $2,600. The smaller figure is the individual maximum limit by law for one election. The reason is that it is a combination contribution for the 2013 primary (past), 2013 general (now), 2014 primary for regular US Senate election and 2014 general election. The effect is to push forward contributions to the present by collecting them now, but the presumed impact is not what you think.  One can only spend funds on an election for which funds have been allocated. Contributions for 2014 cannot be used in 2013 (although contributions raised in 2013 and unspent in 2013 can be carried over to future years). Therefore, the significance is considerable: Booker can only spend ONE-QUARTER of what he's raised right now. 

So, what do you think of that fundraising advantage now?

(2) Mayor Michael Bloomberg's ad buy -- see reason (1) above. Bloomberg doesn't waste money on anything. In fact, he gave $1 million to New York's Independence Party for his last mayoral race (2009) for get out the vote operations, because he knew it was a much tighter race than indicated by polls which predicted a double-digit victory. (Fact: Bloomberg outspent opponent widely but won by...three points! Look it up!)  The Democratic interest groups in New York City are the public employee unions and they turned out their vote, almost resulting in an under-the-radar upset victory.

(3) Democratic operatives are saying they doubt that anyone knows about the special election -- or is motivated to vote -- except for "movement conservatives" and Lonegan diehards. Well, consider this fact: Running a primary against the most popular Republican in the country (Chris Christie), Lonegan got outspent...and got 43% of the primary vote in June 2009.  The fact is that Steve Lonegan has a motivated core group of voters.  Cory Booker's base is out of state and the Democratic organizations in New Jersey are fully aware that Cory Booker has never done anything to help them, financially or otherwise, and they're now likely to return the favor.

If observers remember how turnout was suddenly lower than expected for former New Jersey Governor Jon Corzine in November 2009 (against Christie) in major urban centers in Essex, Hudson and Union Counties, that phenomenon may repeat itself this week.

This is an "elbow grease" election. As in sports, the side that works harder often can and does win. 

Saturday, October 5, 2013

Washington Redskins: More Than A Name

The longtime nickname "Redskins" of Washington, DC's National Football League franchise has in recent years become the target of activists claiming the name is racist and derogatory towards Native Americans and should be changed.  Now the President of the United States has opined that the team's "attachment" to the name "Redskins" is not enough to overcome the sentiments of many that such names are offensive.

One main problem: the name represents --- no, it is -- a brand.  And that brand has value. More to my point, that brand came at a substantial cost: $750 million in the reported purchase price in 1999 by current owner Daniel Snyder. 

Nickname and logo changes can have subtle and sometimes adverse effects on team valuation. When you are an 80-year-old franchise you have a fan attachment that translates strongly to attendance, merchandising and licensing revenues and so on.  Daniel Snyder did not merely buy the right to operate an NFL team in our nation's capital; he bought a historic, established franchise with an equally established fan base. 

The brand matters.  

Should the forces asserting a group offense prevail, and the name is eventually changed, there is a real risk that the team's value will decline. Usually, teams change names for reasons related to wanting to enhance the value.  Logos age and sometimes get outdated; sometimes management wants to revitalize the brand and a logo or name change may do the trick, especially if the brand is considered undervalued.  There's actually precedent there: the National Basketball Association has had a few teams change names: the Washington Bullets became the Wizards in 1997 and the New Orleans Hornets just adopted the name Pelicans this summer.  However, those name changes probably increased those team's values from fairly low baselines, so there is no ready analogy for use with the Redskins.  (Another problem is that sports clubs, other than the Green Bay Packers and Boston Celtics, are private enterprises and are thus always hard to value except when "marked to market" when sold or refinanced.)

I can think of one collegiate sports program where the value may have declined since the change.  The St. John's University (N.Y.) called its teams the "Redmen" and its college basketball program was among the very best in the nation in the 1980s (the heyday of Coach Lou Carneseca and players like Chris Mullin).  In 1994, the University succumbed to the same pressure now being applied to the Redskins, and changed "Redmen" to "Red Storm."  Arguably, neither the program (by any metric you pick) nor its profile in the Northeast / New York City metropolitan area has recovered to its prior heights.

But consider what would happen if the most indisputably iconic sports brands, teams like the Dallas Cowboys or the New York Yankees, were changed. 

If the Cowboys became, say, the Dallas Texans (ironically, an unsuccessful predecessor to the Cowboys, lasting only the 1952 season), and changed their Big Blue Star to a "T," what would you think would happen to the value?

More to my point, how much of your money would you bet on the value even staying constant? Right, me neither.

Former President George W. Bush was a minority owner and managing partner of the Texas Rangers in the 1980s. Can you imagine Bush ever suggesting to an owner of a pro sports club -- or any private enterprise -- that they consider changing the brand name because some group of people (which likely includes just a few token Native Americans as "fronts" for the group) asserts that they are offended?

I ask: Who does Daniel Snyder go to for compensation for the name change?  Will the government bail him out? Will any Native American "tribe" come to his aid? Or will Snyder get a condescending lecture on his duty to society to suffer hundreds of millions of dollars in evaporated value, quite possibly never to be regained, in the name of some sort of justice?

President Obama is out of bounds on this issue. 
 

An ObamaCare website safety tip

The main government website (healthcare.gov) seems to be designed more to collect information on prospective customers than on allowing access to rudimentary information such as plan details. This is why the site forces users to enter personal information, including answers to "trigger" questions, before bringing you to state web pages. None of this is accidental.  

This is exactly what many private companies do if you want to access information.  After all, information is not free.  The difference with the Government's site is that exchange participation is now legally required -- and the only option for millions -- so many people are essentially forced to enter personal information in order to access basic information.

Want to avoid the risk of data breaches because of the carelessness -- or mendacity -- of the most careless government worker?  Here's a perfectly legal way to circumvent the government website: go directly to the websites of the companies participating in the exchanges in your state. Better yet, call those companies. (Yes, minions, that smartphone thingy is useful for actually making phone calls with, you know, real people!)

This is the "old way" of doing things but it will allow you to be free from data security problems. It's a little more legwork and, admittedly, takes some effort.  The payoff, however, is a lot more security and privacy.

Monday, September 30, 2013

Does ObamaCare Make Divorce Rational?

,There are some perverse results from the Obamacare subsidy set-up, as this report details.  Commentators are now seeing that Obamacare provisions may make couples decide to either remain unmarried, or to intentionally divorce so as to qualify for government subsidies.  The financial incentives are significant, particularly for those at the lower end of the income spectrum.

In July 2012 I predicted that strategic divorce would be at least one option that couples who each owned businesses might encounter.  Apparently that option is now foreseeable for a greater number of couples.

Ironically, there were polls in July 2012 which showed that the single woman demographic supported the re-election of President Barack Obama by a nearly 2-to-1 margin over eventual loser Mitt Romney. (Notably, married women preferred Romney.)  This demographic is now facing an unanticipated outcome of their electoral support: an inability to get married.

The following sentence may fill expectant caring fathers with dread as to how to explain to their perennial bridesmaid daughters -- or sisters, nieces or aunts -- the following:

ObamaCare: It's why you're single.





Friday, September 27, 2013

Gay Marriage To Be Allowed in New Jersey

The decision just came down.  

Preliminary reports indicate marriages will be allowed starting Monday October 21st.


Thursday, September 19, 2013

Tom DeLay Acquitted, Convictions Tossed

A Texas appellate court has acquitted former House Speaker Tom DeLay of various state corruption charges for which he was convicted in 2010.

The appeals court rendered a verdict of acquittal, finding the evidence "legally insufficient." This is not merely throwing out the conviction on appeal -- which would allow for a retrial.  This is the court finding the evidence insufficient to sustain the conviction.  It is as if the appeals court were the trial court judge and passing down a not guilty ruling, no matter what the jury did. (Remember, while juries can acquit and convict, judges can overrule the jury if it convicts; on the other hand, a judgment of acquittal cannot be overturned.)


Tuesday, September 17, 2013

Real Risk Avoidance: Just Don't Text!

This news story about a case that may be heard by the top court in New Jersey illustrates the potential liability that the sender of a text faces if the recipient should be driving.

To be truly risk-averse, don't think about whether it can be proven later that you did -- or did not -- know that the recipient of your text (or email or phone call).  I often run into people with this mentality. They always think, "Oh, they can't prove it. Uhhhh!" or something similarly thoughtless. 

True risk aversion, minimizing the risk, something approaching true risk avoidance, is to decide not to engage in the risky behavior in the first place. 

Just don't send that text. It can wait. Learn some patience.

Incredibly as it may seem, when there were very few cell phones 20 years ago and many of us lived with pagers and a pocketful of change, life went on. The sun rose in the east and set in the west. Business was transacted, deals were made and people met and fell in love, all without the use of the Internet.

Technology is great. Especially if you own the technology and have an endless supply of people clamoring to buy your latest killer app.

But it is not the be-all and end-all.


Saturday, September 14, 2013

The First Amendment and John Catsimatidis

NEWS ITEM -- CATSIMATIDIS: SORE LOSER, RUNS TO COURT. There's sour grapes and then there's plain bull. 

Failed NYC Republican mayoral candidate John Catsimatidis is suing YouTube and Google to find out who's behind an obscure video no one has seen.  http://nypost.com/2013/09/14/lost-cats-sues-to-id-video-liars/  (Memo to John: There's something called the First Amendment which allows the freedom to be anonymous as part of the freedom of speech. Pseudonyms have a storied tradition in American political life. How else would we have had Carlos Danger?)

WHY DID HE LOSE? Catsimatidis spent over $170 per vote to lose the Republican primary. He has a compelling personal story but he lost because he deliberately ignored bringing experienced, knowledgeable Republican consultants -- including people raised in New York City, for crying out loud -- in favor of sycophants, other people drawing a paycheck from him and others wanting to draw paychecks from him. One of his key advisers, Vince Tabone, was a lawyer for Catsimatidis' Red Apple Group but was indicted (criminally charged by the Manhattan U.S. Attorney's Office) during his campaign on alleged bribery charges stemming from his other role as Queens County Republican Vice Chair.  

While these third-rate operatives and possible crooks were given carte blanche without having actually, you know, accomplished anything, I could not get a meeting arranged between Catsimatidis and a nationally-known Republican consultant.  Lesson to aspiring politicians, even if you are self-made and wealthy -- you don't win in major races by playing the third-string.  The Yankees don't run out the Oneonta Class A team to win games in September.  

This is why New York City's next mayor will be a far-left former campaign manager for Hillary Clinton who will turn the city into the People's Republic of Occupy Wall Street.

Final note: I predicted Republican turnout in the primary would be over 100,000, but preliminary numbers (excluding the paper ballots and mailed-in ballots not yet tabulated) indicate turnout of approximately 60,000, representing just 12% of enrolled Republicans in New York City.  This is an absolutely pathetic number which is a strong indicator of indifference.  New York City Republicans, the ones who remain in the City, may have just given up.

Wednesday, September 11, 2013

First Amendment Street Fight: National Review v. Cory Booker

Just released earlier Wednesday afternoon -- this story from National Review magazine reporting on a lawsuit I filed on their behalf Tuesday.

Late Wednesday, it appeared the defendants would produce the requested documents. Of course, only after a lawsuit was filed.  Promises, promises.

On Thursday, National Review's reporter Eliana Johnson did get some documents. But not a critical document incorporated by reference into one of the documents which is curiously absent. Read her latest account in a stream of stories that is showing how a straightforward, plain vanilla public document request has become an awfully tortured process.

Readers are advised to check back straight to the source -- here, National Review Online -- for further updates.





Thursday, September 5, 2013

Is The Catholic Church At War With The American Middle Class?

There is a disturbing column out today by a Roman Catholic priest in New Jersey who advocates for "immigration reform."  The object of the column, however objectionable, is less the point than the much more disturbing sentiments underlying it. 

If the Rev. Santora's sentiments accurately reflect Church doctrine, this is a sad (and pivotal) day for Roman Catholics like myself. Our Church actively disrespects, denigrates and attacks me and millions like me because we work, save, invest and build things, as if those are sins. We are reminded that we owe, that we are obligated to help those "around us" who have broken and continue to break the law, who degrade our communities and reduce the value of our assets. 

In strictly psychological terms, the treatment by the Church of these two constituencies reflects a strong and objectionable moral judgment. Without knowing anything else except the fact of the treatment and attitude from the Church, a neutral observer from another planet would be justified in thinking that being poor or needy -- without regard to the causes for those conditions -- is a state to be exalted and to which one should aspire, while to have assets -- obscene possessions -- is a state to be reviled, denigrated and condemned.

Is the Catholic Church at war with the American homeowner and capital class?

Monday, September 2, 2013

Diana Nyad Completes Florida Straits Swim At Age 64

Thirty-five years after her initial unsuccessful attempt, Diana Nyad has completed her Cuba-to-Key West swim in a little over two days.

Nyad is the first person to be documented to have completed the crossing in open water (without a shark tank).

This is a remarkable achievement at any age. Nyad is 64.


Wednesday, August 28, 2013

Hidden Horrors of The New ObamaCare Regulations

The new ObamaCare individual mandate regulations, just released Tuesday and available this morning, will lead to some really perverse gamesmanship as people try to shift the burden or shirk it altogether. Why pay for a meal if you can get it for free and stick someone else with the bill?

(1) HOPSCOTCH, or CATCH ME IF YOU CAN. As long as you are covered for one day in a month, you are in compliance with the mandate.  Even in year one, the mandate penalty is one percent of gross household income, so avoiding the . But you can have people play hopscotch (jump in, jump out) until and unless regulations are adopted or revised to deter this practice.  The result is that people in full-time, good faith compliance will bear a larger burden.

(2) WHO'S YO' DADDY? But not everyone has the burden.  Taxpayers with dependents (spouse + children) now face liability for the "shared responsibility payment," even if the taxpayer does not claim that person as a dependent.  Therefore, if a taxpayer may claim someone as a dependent, the taxpayer is on the hook for the dependent's mandate responsibility.  

The dependent child -- or lower-earning spouse -- can avoid all responsibility because there is still a primary taxpayer in the household. But imagine the horror when you have the acrimony of bitter child-parent relations (and remember, children are covered by their parents through age 26) or divorces and separations. Separating (or wayward spouses) and slacker children can stick the higher-earning spouse (or parent) with the mandate responsibility -- and the penalty -- even if the other taxpayer/parent does not have custody.  A wayward spouse can violate marital vows, fight any motions for divorce or separation, and all the while pass on the mandate responsiblity to the "innocent spouse."  Shockingly, this scenario is actually addressed -- and rejected -- in comments to the regulations.

In reality, this is an anti-man, anti-father provision in effect. While a short term effect will be to deter divorces because this is a new and heavy hammer on couples considering a divorce (and this observation presumes that financial considerations sometimes affect decisions involving marriage, divorce and custody), a dangerous long-term effect will be to strongly discourage responsible men from ever getting married. Those of us with daughters, granddaughters or sisters should be very concerned.  So, who's YOUR daddy?

(3) Another deterrent to productive behavior is contained in regulations including a child's income in the calculation of household income.  This has far-reaching consequences for a family's eligibility for government subsidies. The regulations allow a taxpayer to make an election to have a child's income treated as his own, so that the child is treated as having no gross income.  

But remember that in Bailout Nation and Slacker World, a child is now a child through age 26,  Perverse incentives abound. Slacker young adults in arrested development can now use the ObamaCare subsidy to justify sloth and avoid work, while families on the margin will be incentivized to throw onto the street their kids who -- horror of horrors -- produce income.  After all, extra income from young adults pushes a family to the subsidy ceiling.  This is a strong disincentive to work for any family getting a subsidy; worse, the income counts against the household income upon which the mandate penalty (which for anyone above the poverty level is calculated as a straight percentage of income, rising from one percent in 2014 to 2.75% of gross household income in 2016).

(4) Are you a foreign national and want to work in the U.S.? ObamaCare discourages you from working here, unless you get an American approved health care plan. Having foreign providers of "minimum essential health care" will not relieve you of the mandate penalty. The foreign provider may apply to be recognized as a provider of "minimum essential coverage," but pending that determination, foreign health insurance subjects the holder to the American penalty.

(5) Are you an American citizen or permanent resident living or working abroad? You are still subject to the ObamaCare penalty. Yes, even if you are abroad 365 days a year, your tax home is another country and you are a bonafide resident of that other country for an uninterrupted one year period. 

(6) If the American Commonwealth of Puerto Rico does not establish its own exchange, it appears that Puerto Ricans on the island will not have access to a compliant health care plan and should be subject to the mandate penalties.  ObamaCare requires all states to have exchanges, and states are defined as the 50 states plus the District of Columbia. This should spark a full-fledged run to the mainland -- Puerto Ricans are statutory American citizens -- and possibly a renewed move towards statehood.  The same calculus may be made by residents in the U.S. Virgin Islands and Guam.

(7) Religious exemptions are available, but only through a de facto government test to determine the validity of your faith. People "who are members of a recognized religious sect...and who are adherents of the established tenets or teachings of the sect or religion...are eligible to receive a religious conscience certification exemption from an exchange.  Just read this last sentence slowly. Furthermore, and interestingly, children may not apply for the religious exemption (although they can get abortions), only parents of children under the age of 21 may apply on behalf of the children, and after age 21 the children must apply themselves.  Yet the same children can stick their parents with the responsibility for their health care for another five years (as explained above).

(8) Finally, illegal aliens are exempt from the ObamaCare mandate and penalties. But there is a small victory. The IRS rejected some commentators' proposal to extend the illegal alien exemption to the entire family -- including legal residents and citizens!  Take your small victories for common sense where you can.



(7) 

Tuesday, August 27, 2013

Breaking The Horse: Controlling Miley Cyrus

While Syria is ready to explode in civil war, most of America cannot get enough of an endless loop of former child star Miley Cyrus gyrating on stage, on camera in a sexually suggestive way. (Full disclosure: I haven't even watched the video. Manhattan is full of stupid young women acting stupid -- or worse -- to get attention, and if I choose I can see that...for free! Only a moron pays to see this!)

Conservative commentators have been full of disapproval for the antics. No attention is paid, however, to a solution to stopping this and other former child stars from becoming the latest train wreck, another Britney Spears, another Lindsay Lohan, another Drew Barrymore.

Miley Cyrus shot to fame initially as the daughter of country singing star Billy Ray Cyrus.  That is how she got her main claim to fame among the teenybopper girl set as the star of Disney's "Hannah Montana." But since turning 18 and leaving Disney, Miley has progressively gotten more adult.  

Let's focus on the damage, not to Miley, but to Disney. This entertainment behemoth markets its amusement parks and media channels as family-friendly entertainment.  There is tremendous value in this; indeed, Disney's Florida amusement parks just posted record attendance this year.

While Miley is free to act as she pleases, to destroy her reputation as she pleases, or simply to pretend to do so in order to trade reputation for fame (my theory: this is all an act to get attention), let's focus on the damage she has done to Disney's brand (never mind her own) and how this can be prevented.

If I'm Disney, I'm going to the agents for all its child talent and revising contracts to include both a 10-year morals clause "tail" (that is, starting on the day after the contract expires so the tail governs conduct going forward and penalizes intentionally bad brand-damaging behavior) and deferred money.  These measures protect the brand of both company and performer, and lest you fret, the star keeps his or her freedom -- but is incentivized to keep it very discreet.  

This lack of contractual control and foresight is costing Disney millions as Miley destroys the syndication value of its Hannah Montana franchise with every narcissistic display.  The solution: Creative, foresighted and innovative legal advice that is by no means cookie-cutter.  But you won't get this from the Park Avenue don't-rock-the-boat legal establishment.


Tuesday, August 20, 2013

Being Real and Being Successful: Part 1

I've been advising people that genuineness is a prime element in one's success in any endeavor. You will see this is the case in both personal and professional matters. Character matters, and like the spots of a leopard or stripes on a zebra, character doesn't change. It only gets revealed.

Genuineness has many advantages. It conveys that you can be trusted, that you mean what you say, that your actions and deeds carry more weight than your words and that you are perfectly happy to be judged on your record.

Contrast that approach with the people who demand that you trust them. These are the people who implore you: "Trust me." I'm not talking about the ones with decades of experience who really are saying, "Look at what I've done the last 20 years." That is not asking someone to trust you; it is asking someone to look at what you've done! I'm talking about the people who try to make you feel obligated to trust them.

Trust is not health care; it is not an entitlement. (I didn't really just write that, did I?). Business -- or any successful relationship, for that matter -- is not about one party sacrificing. A successful relationship is symbiotic, featuring a mutual benefit, a willingness to act for that mutual benefit, and an act of trade.

What is the opposite? The act of taking. Someone who demands your respect, your trust, your business, without having demonstrated his character or credentials, has not only not earned your business, but is demanding something FROM you. The code word is trust. The stated meaning is "trust me." The real meaning, the scary but true meaning, is "Give me." It's no different from the stickup man who points a (presumably) loaded gun at you and demands, "Give me all your money!"

This act is not respectful. It is not symbiotic. Rather, it is what biologists call parasitic behavior. And in nature, successful animals -- survivors -- run like hell.

Learn to trust your instincts, or what some people have called, "peasant wisdom." The world is full of stupid people -- after all, that is why the average IQ is 100 and for all you smart bankers and white-collar professionals out there, that means there's someone who's as far below average intelligence as you are above average intelligence.

This means the world is full, chock full, teeming in fact, with some really stupid, dull and boring people.

This is why the lexicon of the upper classes of England -- a declined former superpower from whose aristocracy we can learn much -- includes the word "common" as a pejorative. As in, "that is so common."

But the common people have a nose for who can be trusted. Unlike those of us who are overeducated -- and some who are overmedicated, overtherapied and overindulged -- the commoners have not learned to ignore instincts to indulge an egotistic need to prove their intelligence or affirm their educational, professional or socioeconomic status (the latter really being a form of narcissistic approval-seeking).

This listening to instinct, the survival instinct, explains why many lower-intelligence people survive (a form of success, if survival comes from self-sufficiency instead of dependency) and some lower-intelligence people are far more successful in business than many far more highly-intelligent people. Don't get me wrong; there are many pure frauds and phonies who are in positions of apparent success. But that image of success is transitory and unlikely to be sustainable. Remember, almost all frauds unravel or get discovered, and all frauds have a common core of a person who is a pure fraud at his or her core.

Genuineness, at its core, requires honesty with oneself.

The absence of this trait from your life may explain why you are not successful, why you aren't retaining clients, why you are still stuck in a cubicle, and probably why you're still single (and very likely to remain that way) despite your good looks and superficially charming personality.

The presence of this trait shows why some people will be happy and successful, sometimes despite facing incredible adversity.

In future articles I will expand on this theme to explain how to determine why you aren't successful, and how to change that.
Eric Dixon

Monday, August 12, 2013

Stiglitz's Detroit Bankruptcy Solution: The Road To Serfdom

STIGLITZ: BANKS SHOULD BEAR BURDEN OF DETROIT BANKRUPTCY. Joseph Stiglitz's Monday New York Times op-ed calls for investors and lenders to assume most if not all of the burden of -- that is, the loss from -- Detroit's bankruptcy so that essential municipal obligations, i.e., workers' pension payments and jobs, remain untouched. Stiglitz argues that banks and insurers got their return and now must accept the risk, even the risk of total loss. (In other words, the opposite of the bailouts of AIG, Chrysler, et al. in 2009.)  

Of course, Stiglitz ignores that his proposal would add to creditors a risk for which they did not bargain. Call this the risk of government interference. But unilateral reformation of contracts to allocate a "fair" amount of risk to select parties (which is really a different way of adjusting the risk/return relationship, so you might as well cap their "fair return" at the same time), will cause every party to a contract to think twice to making any investment, loan or transaction. 

As many of us know, reducing the potential return on a given assumed risk reduces the incentive to take any risk. You cannot function in this system, not with your own money, unless you don't mind capital losses by bureaucratic fiat. This is the same type of risk as Powerball -- you can lose everything -- but your upside is limited to what's "fair" and your odds aren't very good either. It's an impotent Powerball.  

As for Stiglitz, the problem is not that he fails to understand this relationship; rather, he very much understands it. This is why arguing or reasoning with people with his perspective is meaningless. This is not a difference of the theory of how risk and reward and economic incentives interact.  The difference is one, a fundamental one, of values.

We need to understand Stiglitz's moral judgment -- that lenders and investors are by definition suspect classes which are "fair game." This is not so much an economics debate as it is one of values. The argument is that it is permissible -- no, it is desirable -- to stick bankers, insurers and investors with losses.  It is their fair and just return, goes the sentiment, to reward them thusly for their untoward desire to make money on an investment.  And the flip side is equally cruel; it's perfectly fine to have these groups lose 100% of their investment.  After all, it's a risk you take with an investment. Of course, it is conveniently ignored -- not because it's not understood but because it is the value -- that the possible return that will be allowed will not adequately compensate you for your risk.

I think we need to understand the goal of this theory.  Discouraging and penalizing investment is not merely the unfortunate collateral result.  I think it is the object of the moral judgments underlying Stiglitz's column.  This is a column that seeks to move us towards a command-and-control economy.  But when it's open season on the capital class, is it any surprise that banks are not lending, even in an era of quantitative easing?  These sentiments will encourage more hoarding, and this is an entirely rational if not foreseeable response.

Wednesday, August 7, 2013

Jersey Shore Is Inflating Home Prices With Government Ripoff

Under the guise of Sandy relief, the State of New Jersey has started taking applications for low and middle-income homebuyers to get up to $50,000 in interest-free forgivable loans to buy perfectly good real estate anywhere in counties which sustained storm damage from last year's Hurricane Sandy.

The state will use up to $25 million in federal funds it recently received for Sandy relief and repair. The money will be used to issue second, or subordinate, mortgages on homes anywhere in Atlantic, Bergen, Cape May, Essex, Hudson, Middlesex, Monmouth, Ocean and Union counties.  This means that if you're poor enough (keep reading), you can buy low-priced property anywhere in a county touching the ocean or one of the flooded rivers (think the Raritan or Passaic Rivers) and get a really good deal.  That property doesn't have to be storm-damaged; it can be on top of the Palisades cliffs or another hilly section miles from any flood zone!

And guess what? You get to have your neighbors pay for it! And there's more --

You do not even have to be a victim of Hurricane Sandy!  You don't have to have lost your home or rental apartment. You don't have to have lost furnishings. You just have to meet the income levels and other requirements.

To qualify, a prospective homebuyer must have an income no greater than 80% of the applicable area median income, a credit score of at least 620 and otherwise qualify for the first mortgage.  The state forgivable mortgage would be a second lien on the property but would be forgiven entirely if the borrower uses the property as his or her primary residence for five years after purchase.  

What this means is the state government -- already billions of dollars in debt -- will now be giving money away to low-income homeowners buying low-priced properties.  Whose values will now spike thanks to the so-called free money, free if you're receiving it.

Of course, if you're middle class or up, you get to pay for this, and sustain your own storm damage and the future risks of further damage. Furthermore, your properties are probably too expensive to benefit at all from this artificial price stimulus at the bottom of the market.

Since the income restriction will put a de facto cap on the value of purchasable properties, it virtually ensures only low-priced properties will be purchased with this assistance. 

This program is being funded in the name of helping storm victims.  Its real impact will be to inflate home prices at the low-end of the market so that low-income homebuyers who do not get the subsidy will be priced out of even the lowest priced homes and condos.  Without a subsidy, the lower and working class home buyer will be priced out of the market.  More brilliance. But this is what passes for "fair" these days.

Monday, August 5, 2013

Will The Fed Declare War...on Homeowners?

The concept of municipalities using their powers of seizure of private property through eminent domain to provide relief to selected "victim" homeowners by seizing and reselling the mortgages on the homes of those underwater borrowers has slowly gained traction.  I have previously criticized the plan in both my July 2012 article and my more recent critique of U.S. Senate candidate Cory Booker's proposal last month.  

Now, other economic commentators are chiming in against the concept.

Jonathan Weil of Bloomberg warns that eminent domain powers may encourage local government graft and new waves of corruption in communities where governments are already somewhat corrupt, systemically or otherwise. 

Jeffrey Dorfman of RealClearMarkets.com writes that eminent domain will help a select small group today, but the costs of the program will be borne by all borrowers, everywhere, in the indefinite future. 

This recent Federal Reserve Bank of New York white paper simply ignores the effects of eminent domain on the lending practices of banks. The fact that the New York Fed actually chose to publish this, in and of itself, should be alarming.  It is one thing for the Fed to declare war on savers by imposing de facto negative interest rates on savings accounts.  It is quite another to suggest the Fed will declare war on homeowners.  


Sunday, August 4, 2013

Standard Practice: Feds Allow Informants To Commit Crimes

Prosecutors at all levels (federal or state) use the testimony of informants to investigate and solve crimes and gain convictions at trial.  There is a downside: the informants are most often criminals themselves, and have a character that lends itself to continuing to commit the same or new crimes. But here is a new twist: the federal government is now admitting that it has allowed -- permitted -- many of its informants to commit crimes, and nearly 6,000 in one recent single year.  (See this heavily redacted January 2012 memo listing the total of Tier I and Tier II crimes as 5,658.)

This is NOT necessarily big news.  The federal government for years has permitted informants to engage in various types of what it calls "otherwise illegal activity." The federal government has procedures governing its agents' (sometimes called "handlers") use of informants, and some of this information is even public. This Bush-era manual (signed by former Attorney General Alberto Gonzales in December 2006) is worth a read (specifically pages 5-7, but the entire manual is worth reading).

The federal government -- and the states -- has long if not always had to rely on inside information about how criminal enterprises work. There often is little other way to get this information.  But there are problems.  The credibility of the informants is suspect to begin with, and ongoing criminal activity or even new crimes just makes that informant's testimony that much more suspect.  Remember, the informant is almost always hoping to get a looming prison term reduced or even eliminated entirely.  This is a powerful incentive to say whatever is necessary to get the government to recommend to the sentencing judge a lenient sentence (less time) or even a non-custodial sentence (such as probation or house arrest). (In the federal system, the local U.S. Attorney's Office will customarily issue something called a 5K1.1 letter, in reference to the section of the federal sentencing guidelines that permits a sentencing judge to make a downward departure from the sentence range for the applicable total number of culpability "points" a defendant is determined to have. The government, of course, will be most inclined to make this recommendation if its informant has been most helpful or productive -- and such help or production is best quantified in the number of defendants the informant has fingered, implicated and help result in guilty pleas or convictions.

Clearly, you can see there is a powerful systemic reason to lie.

Perhaps if you want a solution, you have to look towards the staffing of cases and investigations. Perhaps the easiest solution is to increase the manpower of law enforcement agencies, and increase the pay as well so you attract and retain the best.  In a bloated government bureaucracy, perhaps there is no better use of taxpayer dollars and deployment of able human capital than to investigate ongoing crimes, especially if the tradeoff is reduced reliance on the questionable if hardly reliable testimony or other reporting of already-admitted criminals.  That may prove to be a bargain!









Friday, August 2, 2013

Unemployment Situation Persists Despite Data Manipulation

The new Bureau of Labor Statistics employment report holds dire news for Main Street, and may be good news for Wall Street but only for the moment.

The employment rate increased by only approximately 162,000, the smallest gain in four months.  This is anemic by any measure. However, most people will be fooled by only concentrating on the "headline" figure which is the announced unemployment rate.  This "jobless rate" has fallen from 7.5% to 7.4%.  But as some of us have been saying for years, the important data is not the number, but how it is calculated.  

If you think this jobs report is a sign of "economic growth" or a validation of the massive regulatory hit that the Patient Protection and Affordable Care Act (aka, ObamaCare) holds on the nation, go ahead and invest in equities. There are smart investors who will be happy to sell you -- at a price favorable to them, naturally -- what remaining equities they hold.  Losing money as an investor is part of the risk of being either an idiot, to be frank, or having an attention span disorder.

Here are some other conclusions to glean from the report. First, the employment figures for the last two months were adjusted downward by an aggregate of 26,000. Those figures weren't much to brag about, either, so the economy persists -- at best -- at stall speed.  Secondly, the metrics for both average workweek (hours worked per week) and wages per hour are down.

A plane at stall speed risks falling like a stone. Just consider the analogy.

Other interesting factoids:

Here's one to make you question the data. Black unemployment is down 1.1 percent from June to July 2013. That's a huge move. What explains that?  Oh, by the way, Asian unemployment is UP 0.7 percent and Hispanic unemployment is UP 0.3 percent month to month.  Remember, these are estimates from a small sample size.

The number of discouraged workers is estimated to be 15% higher in July 2013 than in July 2012.

So what will you believe? The data? Or your lying eyes?