Politicians & Groups Are Refusing To Pay Fines

(This image of political corruption is from uab.cat.)

We have laws in this country about political donations. When those laws are violated, the Federal Election Commission issues fines to the violators -- both the politicians receiving the donations and the groups giving the illegal donations. Unfortunately, there aren't enough teeth in those laws, because too many politicians and groups are just ignoring the fines and refusing to pay them -- and they are not being punished for it.

Here is part of an article on this unethical behavior by David Levinthal at the Center for Public Integrity:

In July 2016, the Federal Election Commission slapped the 60 Plus Association with a $50,000 fine, charging that it hadn’t revealed its donors as legally obliged.

The penalty — along with fines assessed to two other politically active nonprofit groups likewise connected to billionaire brothers David and Charles Koch — represented one of the most decisive decisions this decade at an FEC best known for intramural bickering and ideological gridlock. Government reformers rejoiced.

But 15 months later, the Virginia-based 60 Plus Association has only paid one-tenth of its fine. Chairman Jim Martin says the senior advocacy group, which backs “free enterprise, less government” while supporting conservative politicians, has no plans to pay more. The FEC, meanwhile, isn’t forcing the 60 Plus Association’s compliance — or anything close.

The 60 Plus Association has plenty of debt-dodging company: More than 160 political committees and similar groups together owe the government more than $1.3 million worth of unpaid fines, according to a Center for Public Integrity analysis of Federal Election Commission and U.S. Treasury records since 2000.

Some of those unpaid fines amount to as little as $10 while others soar into five figures. Many cases concern all-but-forgotten also-ran political candidates, but others involve political luminaries — the Rev. Al Sharpton, MSNBC host Joe Scarborough and Green Party presidential nominee Jill Stein, among them. Super PACs and politically active nonprofits have joined the nonpayment parade of late. And there’s little evidence any of that cash will soon begin to roll in.

Uncooperative political committee leaders, bureaucratic bumbling and flaccid fine enforcement efforts all contribute to election law breakers outrunning penalties during a time when campaign shenanigans — from Russian advertisements to government contractors bankrolling super PACs — are increasingly brazen and sophisticated.

The situation “reinforces the view of many political actors that there really isn’t a sheriff in town,” said Adam Rappaport, chief counsel for Citizens for Responsibility and Ethics in Washington, which filed a complaint against the 60 Plus Association that prompted the FEC’s fine. “Political actors feel confident and comfortable that the FEC will not enforce campaign finance laws against them.”. . .

How to beat an FEC fine

A Center for Public Integrity review of dozens of political committees’ election violation case files and interviews with FEC, U.S. Treasury and political committee officials shows how political committees typically avoid payment:

• Offenders often just begin by waiting 180 days after the FEC makes its final ruling on the fine, and ignoring the FEC’s strongly-worded letters. The FEC has no unilateral power to seize a political committee’s assets, and it rarely sues in federal court. Generally, Walther says, such legal action is too costly and time-consuming. The FEC isn’t allowed to pocket fine money derived from its own enforcement actions — cash it collects goes straight to the U.S. government’s general fund. “We can’t justify the expense,” Walther said.
   
• If there’s no payment after 180 days, the FEC itself gives up and refers the debt to its de facto collection agent, the U.S. Treasury’s Bureau of the Fiscal Service.   

• Officials at the Bureau of the Fiscal Service typically try to compel payment with more phone calls, demand letters or even referral to a private collection agency. But many offenders just ignore these efforts as well. And why wouldn’t they? Despite having the power to do so, the bureau “has not referred any debts originating with FEC to [the Department of Justice] for litigation,” said Alyssa Riedl, director of the Bureau of the Fiscal Service’s Debt Collection Program Management Directorate. 
   
• The Bureau of the Fiscal Service then often declares the debt “uncollectable” and refers it back to the FEC. “Fiscal Service may return a debt to an agency if it determines that the cost of additional collection efforts will exceed anticipated collections,” Riedl said. 
   
• The FEC then typically mothballs the debt, keeping it on the books but making no substantive effort to collect. “If Treasury, which has greater collection resources than the FEC, was unsuccessful, the commission has no reason to believe it would be more successful in collecting the second time around,” Walther said. 

Why Aren't These Bankers In Jail ?

Once again we hear of fines being levied against some of the giant banks for illegal (criminal) activity. The following is part of an article from The Huffington Post:

The age of multibillion-dollar bank fines with no admission of wrongdoing is over. The Justice Department announced Wednesday morning that five banks pleaded guilty to market manipulation, while also paying billions of dollars in fines. 

Barclays, Citigroup, J.P. Morgan and the Royal Bank of Scotland admitted to illegally distorting foreign exchange markets. The banks formed what they called "The Cartel" and aimed to set a key currency marker, known as "the fix," at mutually beneficial values. 

The fix is set every day at 4 p.m. London time and is used in the more than $5 trillion currency market to determine the price of trades and the value of large institutional holdings. Traders at the banks used instant messaging chat rooms to discuss where to set the fix.

In addition to admitting guilt, the banks will also pay fines. Barclays will pay $650 million, Citigroup $925, million J.P. Morgan $550 million and RBS $395 million. Barclays will pay another $1.3 billion to New York State, federal and U.K. regulators.

The Justice Department said it was charging the banks' parent companies because the wrongdoing was pervasive, and that the banks' punishment was "fitting considering the long-running and egregious nature of their anticompetitive conduct." To put the fines in context, in 2014, Barclay's net income was $3.5 billion, Citigroup's was $7.3 billion, J.P. Morgan's was $21.8 billion and RBS' was $3.9 billion.

Will this stop the giant banks from engaging in criminal activity? After all, aren't those fines large enough to hurt those banks? Sadly, the answer to both of those questions is NO. While the fines might sound big to us normal Americans, they are not that large to these banks. The truth is that the fines don't even cover the amount of money the banks stole -- meaning the banks still are turning a profit off that criminal activity.

This is far from the first time the giant banks have been caught engaging in illegal activities to fatten their already enormous profits. And why shouldn't they continue to do that? If they are not caught, they get huge profits from that criminal behavior -- and if they are caught (like they were this time), they still profit from the illegal acts (just not as much as if they hadn't been caught). In other words, there is no reason for them to stop stealing.

So, how can we stop this illegal banking activity? I believe it would require at least two things:

1. Make the fines big enough to more than cover the money made from the illegal behavior. I would suggest something like 20% to 30% more than they earned from the criminal behavior.

2. Send the CEO and the CFO of any banks found to be engaging in criminal activity to prison for at least ten years (and anyone else in the bank found to be participating in that criminal behavior).

You can be sure that if you or I stole from one of these banks we would be sent to prison. Why shouldn't the same thing apply when the banks steal? No bank or banker should be to big to pay for their crimes.

(Note -- the cartoon image above was found at the website of the Western Rifle Shooters Association.)

Bank Is Fined For Helping The Rich Evade Paying Taxes

(This image was found on the website Veterans Today.)

It's bad enough that the rich don't have to pay the earned income tax rate (the rate paid by most Americans) on the huge amounts of income they have. Instead they have a special lower rate they pay for most of their income (the rate they pay on investment income). This lower rate, combined with other subsidies and tax loopholes (which most Americans don't qualify for) lets the super-rich pay far less in taxes than they should (which is how Mitt Romney paid only about 13% on an income of more than $20 million).

It goes without saying that this needs to be fixed. There should be no special lower rate for any kind of income, nor loopholes to help them avoid paying taxes. But there is something far worse going on -- illegal tax evasion, that is helped to happen by huge international banks.

Recently the giant international bank Credit Suisse pled guilty to helping rich Americans avoid paying income taxes. They had been under investigation since 2009. Among other things, they helped those Americans create sham companies to hide undeclared income, and secretly delivered large amounts of cash to them from outside the country (which enabled them to avoid paying taxes on that money when brought into the country), and destroyed records of transactions (and encouraged clients to do the same).

Credit Suisse agreed to pay a fine of about $2.6 billion in penalties ( $1.8 billion to the United States government, $715 million to the New York Department of Financial Services, and $100 million to the Federal Reserve). That may sound like a lot of money to most Americans (more than half of which make less than $45,000 a year), but it really isn't that much for the giant bank. The bank admitted the fine will just lower (but not eliminate) their second quarter profits. And nobody went to jail -- in spite of the fact that this was an organized and intentional effort to illegally avoid paying taxes.

And anyone who thinks Credit Suisse was the only giant bank helping the super-rich to illegally avoid paying their taxes is living in a dream world. You can bet that most of the other giant international banks are doing the same (or similar) things, and doing it for the same reasons -- so they can attract rich customers and make money off of them.

I applaud the Justice Department for their effort in exposing this case, but I believe they have just discovered the tip of a gigantic iceberg -- and much more needs to be done. In addition, why haven't we heard about cases being brought against the individuals the bank had helped avoid those taxes? Have they been forced to pay back taxes? Why aren't they in jail (as an example to others doing the same thing)? Are they too rich to send to jail?

Finally, you may be wondering what any of this has to do with ordinary Americans. Well, it's because it is the ordinary middle class American who has to make up for the taxes these rich criminals avoid paying. If you think your taxes are too high, you need to realize that this is a primary reason for it. Someone has to pay for government, and if the rich won't pay their fair share, then the rest of us must pay more to make up for it.

Airlines Want To Continue Abusing Passengers

Air travel in this country used to be a fast and fairly enjoyable way to travel. There were few delays and the airlines actually treated customers like they wanted to keep their business. Of course, that was a long time ago. Today, airlines treat their passengers more like cattle being hauled to the slaughter house.

At some airports, airlines over-schedule their flights and leave their passengers sitting on the tarmac for hours at a time. There have been times when passengers had to sit cooped-up in an airplane on the tarmac for 9-12 hours. And there's nothing a passenger can do once in the plane. If they complain too much, the airline will have them arrested for disrupting a flight (even though the plane hasn't even tried to get in the air).

Fortunately, the federal government is coming to the rescue (sort of). Starting next month, new rules go into effect that will fine an airline up to $27,500 per passenger for every passenger that has to sit on the tarmac longer than three hours. That's still too long, but it's not as bad as many waiting times right now.

This might actually get the airlines' attention and cut out many delays. Just think, a Boeing 737 (pictured) with a full load of passengers could be fined nearly $4 million, and a Boeing 777 could get a fine of $8.9 million. Fines like this could play hell with a company's bottom line, especially if it happened repeatedly.

So how have the airlines reacted? Have they adjusted their scheduling to avoid the torturous delays that passengers must suffer on the tarmac? Not at all. They have asked to be exempted from the new rule. American Airlines, JetBlue and Delta have all asked for exemptions so they can continue to torture their passengers. And guess what? They just happen to be the airlines that keep passengers waiting on the tarmac the most.

These are the guys the new rules were written for, and there is no way they should receive any exemption for any amount of time. The rules were written to protect passengers -- not airline profits. The rule should start next month as planned, and should apply to all airlines -- with no exemptions.

The passengers are helpless in this situation, but the airlines are not. They can adjust their scheduling to prevent these ridiculous delays, and they should be forced to do so (or fined severely).

Pollution Fines Just A Business Expense In Texas

We known for a while now that Texas is one of the worst states pollution wise. In production of greenhouse gases, Texas leads the nation and if it were a country, it would be seventh in the world in greenhouse gas pollution. But that's not the only kind of pollution being dumped into Texas skies and water.

The oil, gas and chemical companies are dumping all kinds of poisons and cancer-causing chemicals into the environment, such as sulfuric acid, carbon monoxide, benzene and many other substances. Making matters even worse, the companies will try to hide their pollution and even lie about it when it is discovered.

The Texas Commission on Environmental Quality (TCEQ) makes a feeble effort to control this pollution by levying fines for the pollution they discover. In 2009, they levied 1,750 fines totaling $14.5 million. But that's just a drop in the bucket when you consider the huge profits these companies are making. Consider that Exxon Mobil was fined $1.1 million for 23 separate violations in 2009. But they made $45.2 billion in profit for 2008 and will top that for 2009.

Frankly, the pitiful fines levied by the TCEQ is doing nothing to stop the pollution. The fines are so small compared to profits, that the companies just consider it a cost of doing business -- a cost that is cheaper than cleaning up their way of doing things.

As Matthew Tejada, director of Galveston/Houston Association for Smog Prevention, says, "The TCEQ still has not changed the long-standing principle in Texas that you can pay to pollute. They have taken little steps forward, but for the big companies out there, it's just a drop in the bucket. The penalty system in Texas is not making it worth companies' while to actually clean up."

Of course, that is just how our Republican state leadership want it. Without exception, they always side with their corporate buddies against ordinary Texans. After all, they consider the illness and deaths of Texas citizens to be little cost when protecting the exorbitant profits of the polluting corporations. And it will stay that way as long as the Republicans stay in power.

Here are the top ten Texas polluters, along with the fines they paid and the number of their known violations:

1. Total Petrochemical USA Inc.: $1.58 million (11)

2. Dow Chemical Co.: $1.14 million (8)

3. Exxon Mobil Corp.: $1.1 million (23)

4. Shell Oil Co.: $684,174 (5)

5. BP PLC: $662,650 (2)

6. BASF Fina Petrochemicals: $603,628 (5)

7. Chevron: $568,910 (18)

8. Enterprise Products Operating LLC, $551,550 (2)

9. Valero Energy Corp.: $354,896 (8)

10. Dupont Co.: $306,544 (11)

Fines And Ankle Monitors For Truancy

Anyone who lives in a city of any size knows that truancy has become a major problem in our society. In many cities, as much as 10% of high school and middle school students are serial truants. They are blowing their opportunity for a free education and a passport to a decent life, and many of them will wind up a drain on society -- as criminal inmates, welfare recepients, or spend their lives bouncing between minimum wage jobs and unemployment.

Many cities, including the one I live in, are trying to solve this problem by putting pressure on the parents. The parents of serial truants are fined, sent to parenting classes and even jailed. This may have been a good idea, but it is simply not having the desired result. If a parent doesn't have control of their child by the time they are in middle school, then they probably never will.

But a judge in Midland (Texas) has shifted the focus of the attack on truancy in his city and seems to be having some success. Judge David Cobos (pictured above) is holding the truants responsible for their own actions -- not the parents.

He is fining the serial truants, and making them pay their own fines instead of their parents. If that doesn't work, the next step is an ankle monitor. Those fitted with a monitor are allowed to go only to school and back home, and they are monitored 24 hours a day, seven days a week. Jail is in store for those who ignore the ankle monitor. The best part is that by making these students responsible for their own actions, he is having an 80% success rate. That's remarkable!

The judge has also raised private funds to help rectify issues raised by poverty. For instance, one male student was skipping school because he had to wear his older sister's hand-me-down shoes (pink tennis shoes) and the other students were making fun of him. The judge tapped the fund to buy the student his own shoes and the problem was solved.

Not everyone likes the judge's approach. The ACLU believes it is a violation of the students privacy. I like the ACLU and usually agree with them, but not on this issue. The students have a right to a free education in this country, but they don't have the right to not go to school. In fact, the law states they MUST go to school.

All of the community's citizens pay taxes to support the right to a free education (even renters). It is not too much to expect the students to obey the law and take advantage of the opportunity they have been given. Judge Cobos is not trying to be mean to these students. He is trying to help them, and he's succeeding with a much larger percentage than most other cities.

I applaud Judge Cobos -- both his methods and his dedication to the welfare of Midland's students.