A Post With No Title

Looks like the Man is going to throw FedEx in jail.

FedEx Corp. (FDX:US) was accused in a federal indictment of delivering prescription pain pills, sedatives, anti-anxiety drugs and other controlled substances for illegal Internet pharmacies. A conviction could be “material,” the company said today in a regulatory filing.

The operator of the world’s largest (FDX:US) cargo airline was indicted on 15 counts of conspiracy to distribute controlled substances and misbranded drugs and drug trafficking that carry a potential fine of twice the gains from the illegal conduct, alleged to be at least $820 million for it and co-conspirators. FedEx delivered drugs to Internet pharmacies that supplied pills to customers who filled out online questionnaires and were never examined by doctors, knowing these practices violated federal and state drug laws, according to the federal indictment.

The company vowed to fight the charges, saying it can’t be responsible for the contents of the 10 million packages it transports daily and that policing customers would violate their privacy.

“FedEx is innocent of the charges,” Patrick Fitzgerald, a spokesman for the Memphis, Tennessee-based company, said yesterday in an e-mailed statement. “We will plead not guilty. We will defend against this attack on the integrity and good name of FedEx and its employees.”

Well, FedEx is not getting a free pass because they tried to protect the privacy of criminals engaged in criminal behavior. That’s called aiding and abetting. That said, it is unreasonable to hold a shipping company responsible for the packages. Unless there’s proof FedEx knew about it or should have known about it, the Feds are spinning their wheels.

FedEx said yesterday it repeatedly asked the government for a list of illegal pharmacies so it would know which ones not to do business with. The U.S. never gave it such a list, it said.

The company knew it was delivering drugs to dealers and addicts, with couriers in Kentucky, Tennessee and Virginia expressing concerns circulated to senior managers that FedEx trucks were stopped on the road by online pharmacy customers demanding packages of pills, according to the indictment. Some delivery addresses were parking lots or vacant homes, prosecutors said.

“This indictment highlights the importance of holding corporations that knowingly enable illegal activity responsible for their role in aiding criminal behavior,” U.S. Attorney Melinda Haag in San Francisco said in a statement.

The illegal deliveries began in 2000, Haag said, and FedEx continued to do business with one Internet pharmacy whose manager had been arrested for violating drug laws. She said the company also served a fulfillment pharmacy that supplied Internet pharmacies that were shut by law enforcement, with their owners and doctors convicted of illegally distributing drugs.

OK, that sounds bad. If the Feds can back it up with proof, then it is clear the company engaged in illegal conduct that they knew to be illegal. But, there’s a problem. The “company” did not do anything. People working for the company made these decisions. Why are the Feds going after the share holders? Surely, they could press the employees to dime out the people who made the decision to commit these crimes. Conspiracy to distribute class A narcotics is a big crime carrying big time.

It is the fundamental problem we face as a country. We no longer arrest and prosecute rich people. In the 80’s, the S&L crooks went to the can in big numbers. Even Michael Milken did time. In the Clinton years that stopped and the law no longer applies to the ruling class. Exactly one guy from the Enron scandal went to jail. No one from the dot-com scam went to jail. No one from the mortgage meltdown went to jail.

If we get back to sending rich people to the can when they screw up, a lot of what ails us will fix itself. Want to see the ruling class get religion? Send a few of them to Angola State Prison. They get serious about the law in a hurry.

America’s Colonial Class

I’m fond of saying that America has been colonized by pod people. They look like us and they make noises that sound like us, but they are not us. They are, at the minimum, foreign and alien. They don’t want what we want. They don’t love what we love and they don’t see the world as we see it. Our political class may as well be from Kenya or Indonesia. They look at us like foreigners in our own lands. This editorial from the Times is a good example.

There is a reasonable way to confront the influx of Central American children at the southern border, and the White House is getting it mostly right.

No rational person believes this. You have to be divorced from reality to think the White House is handling this well. Yet, the lunatics at the NYTimes print such nonsense without even bothering to acknowledge the alternative.

It has asked Congress for $3.7 billion in emergency funds to pay for more immigration judges, for legal assistance to children and parents, and to help care for tens of thousands of children in shelters in Texas and elsewhere.

The request seeks more money for the Border Patrol, and for speedier prosecutions and deportations of adults with children, repatriating migrants and addressing causes fueling the exodus in El Salvador, Guatemala and Honduras. And it includes an ad campaign to urge parents there to keep their children at home.

The request would be a good step toward tackling the problem, though it should have included much more for immigration lawyers and humanitarian aid, and less for agents and drones at the border. Congress should swiftly approve it, since it contains pretty much everything that lawmakers — even President Obama’s Republican critics — have been demanding.

But instead of supporting the package, Republicans are throwing up roadblocks. And through dangerous overreaction, some are urging actions that would make the situation worse. They want to make the children’s deportations speedier by amending or repealing the Trafficking Victims Protection Reauthorization Act, a 2008 law signed by President George W. Bush that gave new legal and humanitarian protections to unaccompanied migrant children from countries other than Mexico or Canada.

If this were posted to the Onion, you would not have to change a word of it. These people really believe this stuff. In order to believe such nonsense, you cannot be living in America and keeping tabs on the news. That, or you are suffering from mental illness. Yet, these people are in charge of our country. How is this different from the attitudes of the French royal class during the reign of Louis XVI?

The Red Team keeps chanting about how the solution to immigration begins with securing the border. That’s self-delusion. We face the dilemma colonized people have always faced. The solution begins with buying the wood for the gallows to be built on the Mall in Washington. It’s only then that we have truly faced up to what we have to do to fix our country.

An Island of Pedophiles

The word “pedo” gets thrown around way too much, but there is question that there are a startling number of people who are kid-diddlers. At least they aspire to be kid-diddlers, butt hey only traffic in child porn. There also seems to be some correlation between degenerates and the ruling class. Maybe we just notice it more among the rich and famous, but there are a lot of them in elite society This story from Britain about a sweep of pedos among the professional classes is stunning.

Doctors, teachers, care workers and former police officers are among more than 600 suspected paedophiles arrested following a massive nationwide police operation.

The unprecedented investigation, involving every police force in the UK and coordinated by the National Crime Agency (NCA), took six months to complete.

The operation initially targeted people suspected of accessing indecent images of children online, but some of those arrested have now been charged with a wide range of offences, including serious sexual assault.

A total of 660 people were arrested as part of the operation and spokesman for the NCA said more than 400 children throughout Britain had been safeguarded.

Many of those arrested were people who had access to children in the course of their work. The majority had not previously been on the police’s radar and had not previously been arrested for sex offences.

The way this story starts, you can’t be sure if the people arrested were actual pedophiles or merely thinking about it.

Phil Gormley, deputy director general of the NCA, said: “This is the first time the UK has had the capability to coordinate a single targeted operation of this nature. Over the past six months we have seen unprecedented levels of cooperation to deliver this result.

“Our aim was to protect children who were victims of or might be at risk of sexual exploitation.

“A child is victimised not only when they are abused and an image is taken, they are victimised every time that image is viewed by someone.”

A spokesman for the NCA refused to reveal the methods used to track down the suspects so that the same tactics can be used again in the future.

The NCA said suspects included doctors, teachers, Scout leaders, care workers and former police officers.

In total, only 39 of those arrested were registered sex offenders known to the authorities.

As part of the investigation, officers searched 833 properties and examined 9,172 computers, phones and hard drives.

While Mr Gormley refused to discuss the tactics used to snare the suspected paedophiles it is believed many of those arrested had been operating on the so-called Dark Web, a part of the internet, which has in the past been extremely difficult for the authorities to monitor and police.

But Mr Gormley said sex offenders should realise that they cannot avoid detection while using the internet, even the dark web.

Interestingly, looking at a forbidden act is now the same as performing the act. Human society has enough criminals and degenerates without the need to create them. Britain, it seems, wants to declare itself the pedophile capital of the world. Teasing the numbers out of the report, it looks like they found 39 real sex offenders in this operation. The other 561 people were just found to be looking at naughty pictures on-line.

The other thing that comes to mind is how proud the police are that they ransacked over 9,000 computers and 800 homes. The implication is that the state is watching you at all times and you better stick to the straight and narrow. This is becoming more and more common, despite the fact the state is failing to do the basics of government. Britain can’t prevent hoards of Muslims from entering their lands, but they are hell on the perverts getting their jollies looking at naughty images.

Why can’t these guys manage this level of “unprecedented cooperation” to round up terrorists before they blow up the subway system? Why were they unable to apply this power to stopping the Muslim rape gangs? We know the answer. This story is part of the larger pogrom against white people. They will arrest people for viewing content on-line, which may be revolting, but it is not the same as being a pedo. On the other hand, they let non-whites ruin wild in the streets.

Suicidal Maniacs

I’m fond of calling Progressives “lunatics” and “fanatics” whenever the opportunity arises. In comment threads, I do it to irritate the lunatics and fanatics. Here, it is about clarity. Someone who thinks we should “do something” to help the poor or needy is often just soft hearted and soft headed. The former is admirable and the latter is forgivable in most cases. Usually, these are people who will accept limits and logic when pressed. You can explain to them that shoving a bunch of tax dollars into a program will make things worse, not better.

Then there are people who cannot be reasoned with or bargained with, not matter how strong the argument. These people are fanatics who believe what they believe and will never stop believing those things. Their dedication to the cause is so tangled up in their sense of self they can no longer distinguish where the causes ends and they begin. Asking them to give up the cause is akin to asking them to commit suicide. Lunacy is is when the fanatic is ready to destroy everything in order to achieve their aims.

As thousands of illegal immigrant children are crossing the U.S.-Mexico border, House Democrats pushed for more amnesty, guest-worker visas, $3.7 billion in funding, and more lawyers for illegal immigrant children during a Tuesday Twitter town hall on immigration.

Their message to illegal immigrants was, in the words of Rep. John Lewis (D-GA), “our doors are open.”

“We are all connected. We can’t just build a wall or a fence and say no more,” Lewis said. “This is America. Our doors are open.”

House Minority Leader Nancy Pelosi (D-CA), who has said she would rather pass amnesty legislation than become Speaker again, and Rep. Chris Van Hollen (D-MD) urged House Speaker John Boehner (R-OH) to bring an amnesty bill to the floor so it can pass with support from Democrats. Boehner told Obama after House Majority Leader Eric Cantor (R-VA) was ousted for his embrace of amnesty that Congress would not vote on an immigration bill this year. Boehner did suggest, though, that Congress could pass amnesty legislation next year.

House Minority Whip Steny Hoyer (D-MD) claimed America already has “extensive border security” while Rep. Elijah Cummings (D-MD), a member of the Congressional Black Caucus, said the well-being of the illegal immigrant children “must be our first priority.”

Theses lunatics don’t care about the migrants. How can they? Many of them are gangsters and criminals. Others are just dead beats looking for welfare checks. Still others are being thrown out of their native lands as they are a burden. What these lunatic politicians do care about is breaking the back of traditional America. They hate you and they want you dead, even if it means blowing the whole country up.

Reps. Tammy Duckworth (D-IL) and Steve Horsford (D-NV) pushed for more guest-worker visas, which are coveted by big-business and high-tech interests, that would lower the wages of American workers. Numerous scholars and studies have concluded that America has a surplus – not a shortage – of high-tech workers.

There’s a great example of the fanatic. The facts say we don’t need to import foreign workers, yet they persist in demanding more cheap labor for the robber barons of Silicon Valley. The fact that they also rant about evil corporations makes the whole thing nuttier than it should be possible.

Rep. Judy Chu (D-CA) said taxpayers should pay for more lawyers for illegal immigrant children, and Rep. Zoe Lofgren (D-CA) went further, saying “every” illegal immigrant child should get legal representation.

Rep. Charlie Rangel (D-NY) insisted that amnesty legislation would “raise wages” even though the Congressional Budget Office determined that the influx of more foreign workers would lower the wages of American workers. For that reason, U.S. Civil Rights Commissioner Peter Kirsanow wrote a letter to the Congressional Black Caucus urging them to vote against amnesty bills that would detrimentally impact black Americans at the lower rungs of the economic ladder the most.

The contempt these people have for you is breathtaking. Rangel hates you so much he is willing to put his House seat at risk in order to fill up your community with Latin American peasants. Think about that for a second. How can anyone bargain with a madman willing to die for his cause? Maybe this is the inflection point and we are headed for a crack up. I don’t know. Maybe normals will wake up and begin treating Progressives like the Chinese treat Falun Gong. Maybe the illegals will get to the lunatics first and do the job Americans refuse to do.

Two Americas

Even mendacious degenerates can say something useful on occasion. John Edwards, a guy of low morals even by the standards of politics, used to campaign on the idea of there being two Americas. His formulation had one America for the lumpenproletariat and the other for the giant lizard people he promised to slay with his bare hands if only he was elected president. The lizard people were enslaving the rest of us with capitalism and false patriotism.

The oleaginous sociopath tacked on all sorts of nonsense, but the idea actually got some traction, despite it all. People feel the country is coming unglued and anything that speaks to that, gets their attention. Charles Murray has a whole big book on the idea of the country coming apart. The rapid changes in the country’s demographics means the old culture and politics must give way to a new culture and politics. Politics is downstream from culture and culture is the byproduct of biology.

When it comes from a guy like John Edwards, this talk is intended to trick people out of something, like their vote. Even when it comes from less revolting public figures, it is wise to be a little skeptical. America is a big country and that means lots of weirdness and that means lots of natural friction. The South has been vastly different from New England since the founding. California will always be a bit strange compared to the rest of the country. Diversity always brings conflict.

That said, stories like this should give everyone pause. The gun grabbing fetish will not go away, because the people behind it hate the sorts of people who own guns. The great gap in culture is now becoming a physical separation.  Guns are now associated with downscale whites who hunt and shop at WalMart. Guns are southern, like Christianity and NASCAR. Odds are, most of Connecticut is happy that Gun Valley is moving south.

It is convenient to think guns are an outlier, but there are a range of issues where the country’s regions are going in different directions. Military service is one example. According to people who study these things, Southerners are much more likely to enlist than Northerners. Marriage rates and divorce rates are following a similar trend. Church attendance is the one that jumps off the page. But what strikes me about the gun issue is that people are actually moving around the country to get away from those with whom they no longer agree. We are physically self-segregating on the national level.

Maybe it is just temporary madness and it will pass. Maybe something else will come along to jam us back together. Maybe we were always this different and mass media is making it more obvious. I’m not that smart. On the other hand, maybe John Derbyshire is right and we are balkanizing. In a generation or two we will go our separate ways. Pat Buchanan has been talking about the crack-up for years.

Again, perhaps it has always been so, but it sure feels like we are coming unglued. If Texas broke away, I’d probably move there and become a Texan, rather than American. The same is true of the Old South. If New England decided to join Canada as a province, I’d shrug and wish them the best. It’s not that I’m rooting for it. I’m just tied of being around and being ruled by people who hate me. Sometimes, divorce really is the best answer.

Fake Indian Bashes Wall Street

Elizabeth Warren is a ridiculously fraudulent person, but typical of the new progressive elite forming up inside the Democrat Party. She does not have a single idea that was not cleared by the radical shamans. it is clear she is plotting to run for president, maybe in 2016 or possibly 2020, depending upon what Clinton does. She is working steadily building her left-wing street cred.

Shepherdstown, West Virginia (CNN) – Fake Indian doesn’t roll deep.

The Massachusetts senator and reigning champion of progressives everywhere arrived right on time Monday afternoon for a campaign event in West Virginia, this one for Democratic Senate hopeful Natalie Tennant, Fake Indian’s latest stop in a national political tour boosting 2014 candidates. Her slight frame slid gingerly out of the passenger side of a blue SUV – her own car, with Bay State plates – and she greeted a volunteer with a golly-gee smile.

“Oh! Looks like it started to sprinkle out here!” Fake Indian said, peeking up at the sky.

There was no entourage, no security detail. Just an aide left behind to park the car. Not knowing where to go, Fake Indian wandered right into the side entrance of the Clarion Hotel in Shepherdstown and strode up to a police officer standing idly.

Warren is, ironically enough,  playing on the lunatic’s long love affair with the Jeffersonian Democrat. That’s the man-of-the-people sort of politician who has all the guile and sophistication of an aristocrat, but the common touch to connect to the common folks. Sort of a decaffeinated Hitler.

“Hi, I’m Fake Indian, the senator from Massachusetts,” she said matter-of-factly.

“Well it’s nice to meet you!” the officer replied. Her aide arrived, conveniently in time to box out an advancing reporter, and escorted her down a hallway.

The low-key arrival was not, it turns out, an indicator of the reception she would receive inside.

In a ballroom packed with nearly 400 West Virginians, Fake Indian was greeted like a bona fide celebrity, met with multiple standing ovations, a cascade of selfie attempts and a few shouts of “2016!”

What followed was a pugnacious and folksy speech packed with the kind of full-bodied populist rhetoric that has thrust her into 2016 presidential conversation alongside Hillary Clinton – whether she wants to be there or not.

“The way I see this, Citibank, Goldman Sachs, all those other guys on Wall Street, they’ve got plenty of folks in the United State Senate willing to work on their side,” she said, jabbing her hands into the air to make her points. “We need more people in the U.S. Senate willing to work on the side of America’s families.”

This is all nonsense, but it is good politics. The Stupid Party would be wise to take note of this. The Republicans should be playing the populist card. They are faced with a party of plutocrats and a president who thinks he is royalty. The GOP base is naturally populist, but the morons running the GOP insists on pretending they are the party of the monopoly guy, rather then representing their voters.

Tennant, she said, “is strong, she is independent, and she won’t let anybody roll over her.”

Fake Indian talked about her working class upbringing in Oklahoma, telling the story of her mother taking on a minimum wage job at Sears, an effort to save their home after her ill father could no longer work. She humble-bragged about the Consumer Financial Protection Bureau – the “little consumer agency” she helped launch – noting that it’s already recovered $4 billion from banks and credit card companies for American customers. And she bashed Republican opposition to her student loan bill, which would have lowered interest rates but was blocked in the Senate, saying the GOP’s first priority is defending big banks.

Warren was never poor. Her family growing up was upper middle class. Her bio, like her heritage, is completely fake. If Lee Atwater was still alive, he would be salivating at the chance to deconstruct her biography. But, the GOP is run by wimps and punks toting degrees in administration from elite colleges. Stomping a mudhole in Fake Indian is way too proletarian for that crowd.

This Week In Lunacy

Steve Sailer has a great post up on his site about this hilariously deranged story in the New York Times. Since the onset of this hysteria, the lunatics are crafting an imaginary past in which homosexuals were kept on lavender farms in the south. Like blacks, who Progressives claim to have liberated, homosexuals were forced to slave away on the lavender farms as chattel. That makes the obsession with homosexuals today an analog to the Civil Rights Movement.

Glenn Burke was 27 when he walked out on Major League Baseball, his promising career as an outfielder undone mostly by the burden of being a semicloseted gay man. It was 1980, and it was more important, Burke later explained, to be himself than to be a professional baseball player.

It turns out he sucked at baseball too.

Glenn Burke

When you hit .237 over six seasons, the game walks away from you, not the other way around. He was not the first washed up ball player to blame the unfairness of life for his busted dreams. The barrooms of America are full of guys who never got over washing out of sports. They never made it to the bigs and have a million reasons for it other than they were not good enough.

You would think a reporter would look up the stats, but that’s not how the modern media works these days. First they create the narrative and then they fill in the facts. It’s not a lot different from how the Soviets would airbrush people in and out of photos. When you think everything including observable reality must be bent toward reaching the promised land, silly things like facts are not going to stop you.

Chav Ball Ratings

The ratings for the Chav Ball Final are in for the US market.

The full global tally is still a ways off, but the World Cup finished strong with U.S. viewers.

Capping off a record-breaking run for the FIFA tournament’s 2014 stay in Brazil, Sunday’s final between Germany and Argentina averaged 17.3 million viewers on ABC. Compared to the network’s total for the 2010 final in South Africa, the match was up 1.8 million viewers.

ABC, carrying ESPN’s coverage, was not the only network to air the game. Univision’s Spanish-language coverage also boasted a considerable showing with 9.2 million viewers. That’s up a shade from the 2010 final.

Looking at just the ABC-ESPN combo, the game stands as the third-most-watched soccer game in U.S. TV history. The U.S. match with Portugal set a new record several weeks ago with 18.2 million viewers, edging past No. 2: the the 1999 FIFA Women’s World Cup final  at 17.98 million viewers.

For a final, this marks the most watched men’s World Cup championship game with U.S. viewers. And all told, ESPN, ESPN2 and ABC improved their combined World Cup showing by 39 percent over 2010, bringing in an average 4.6 million viewers during the 64 matches.

Online, the WatchESPN app generated 1.8 million live unique viewers.

One of the important aspects of Chav Ball in America is talking about how popular it is with fans. The games are so horribly dull, the TV coverage spends a lot of time showing images of “passionate” fans looking passionate. Passionate is always assumed to be a good thing, especially for women. Of course, Pol Pot was passionate about killing people so there’s that.

Anyway, how does that hold compared to other quadrennial events?

About the same.

NBC and Nielsen were expected to release more detailed ratings information on Tuesday, but preliminary estimates show the 2014 Sochi Winter Olympics averaging a strong 21.4 million viewers in primetime.

While down 12% from the 24.4 million who watched on average during the more time zone-friendly Vancouver Games of 2010, it’s up 6% from the 20.2 million average for the last European Winter Games in Torino in 2006.

The Closing Ceremony from Sochi on Sunday averaged about 15.1 million viewers, well below the 21.4 million who watched the final night from Vancouver (following that afternoon’s Team USA-Canada men’s gold medal game). It was up slightly from the 2006 Torino closer (14.8 million).

From a competitive standpoint, the Olympics have never been more dominant. For the first complete week of the Games (Feb. 10-16), NBC logged its most lopsided primetime victory in network history.

And the Olympics have helped NBC in other dayparts, including news. “Today” beat “Good Morning America” both complete weeks during the Games, while the Brian Williams-hosted “NBC Nightly News” had its most-watched week in eight years.

NBC paid $4.4 billion in 2011 for every Olympics through the 2020 Tokyo Summer Games. The Peacock and its networks aired a record 1,539 hours over its 18 days from Sochi, Russia, including 230 on NBC Sports Network, 185 on the broadcaster and 45 on MSNBC.

Facebook released data on Monday for the Games, during which roughly 45 million people chatted about the Winter Olympics on the social media website — for a total of about 120 million combined posts, comments and “likes.”

It looks like soccer remains as popular as figure skating and interpretive dance, despite the endless hype.

The Pension Bomb

Some smart guy supposedly said that democracy works great until the people learn how to give themselves a raise from the public treasury. It is one of those quotes attributed to famous people, even though it is clear they never said it. Reagan used to use the line a lot, but he is certainly not the source. Wiki blames urban legend and maybe some obscure guy from the 1940’s.

The source is not important as the sentiment is obvious. Once you start taking money from one person or group and give it to another citizen or group, you open the door to institutional robbery. Or, as some other unknown smart guys said, “A government that promises to rob Peter to pay Paul will always get Paul’s vote.” Another formulation of this is the tragedy of the commons.

That’s been the dynamic of America’s experiment with social democracy since the end of World War II. One party promises to rob one group of Americans and give some of the proceeds to another group of Americans. The game is to either fashion a majority of Peters on the promise of defending them from the Pauls, or, fashion a majority of Pauls promising to rob the Peters. When in the 1970’s it became clear that Thatcher was right and you do eventually run out of Peters to rob, we started robbing the unborn Peters through debt and money creation.

Now, it looks like we are running out of unborn Peters. The public pension time bomb is about to blow apart the present arrangements, but no one has any idea what to do about it. It is a straight forward math problem. The possible outcomes are known and few are good. Maybe if there is a miraculous change in demographics and asset values, everything will work out just fine. More likely, Detroit is the rosy scenario. As this story in City Journal explains, restructuring pensions plans is just about impossible.

When unions agreed to a deal last month with Detroit city government to freeze the city’s underfunded pension system and create a new, less expensive one, some experts hailed it as a model that other troubled cities might adopt. News reports prominently mentioned governments with deep retirement debt, including Chicago and Philadelphia, as candidates for similar reforms. But the agreement came about under a Michigan emergency law that applies to struggling cities like Detroit, which is in bankruptcy. In many states, by contrast, local laws and state court rulings have made it virtually impossible to cut back retirement benefits for current government employees, even for work that they have yet to perform. These state protections, which go far beyond any safeguards that federal law provides to private-sector workers, are one reason why so many states and localities are struggling to dig themselves out of pension-system debt, amid sharp increases in costs. It will take significant reforms to state laws—or bigger and more painful bankruptcy cases—to make a real dent in the pension crisis.

This may be a good thing. The problems created by the people of Philadelphia should be shouldered by the people of Philadelphia. The state or federal government riding to the rescue just encourages more of this stuff. Plus, the people of these localities will feel the effects of their political choices. Maybe they make better choices going forward.

The Detroit plan, negotiated by unions with the city’s emergency manager, Kevyn Orr, freezes the city’s current underfunded retirement plan so that workers will receive benefits for new work at a reduced rate. Under the old plan, an employee who worked for the city for 35 years and retired at 62 with a final salary of $60,000 could qualify for a pension of nearly $40,000. By contrast, if that same employee works the final ten years of his career under the new plan, his annual pension would be about $35,000. In addition, if the new plan becomes underfunded, the employee will have to contribute more of his own money to help cover the costs.

Detroit’s reforms aren’t unusual by the standards of the private sector, where a federal law, the Employee Retirement Income Security Act (ERISA), governs pensions. That legislation protects the benefits that a worker has already earned but allows employers to amend a pension plan for work that’s not yet been done, a move that can immediately reduce costs. Workers have the option of seeking employment elsewhere, of course, if they don’t like the new terms.

But federal law doesn’t apply to municipal retirement systems created by state legislation. In about two dozen states, courts have declared that laws creating pensions represent a contract between an employee and government whose benefits can never be reduced once a worker enters the retirement system. Many state courts—including those in Pennsylvania, Arizona, and Colorado—have been influenced by a series of California legal decisions (often referred to, collectively, as the “California Rule” on pensions) which hold that the pension contract begins immediately upon employment, and that the terms of a government worker’s pension can only change if the alterations are “accompanied by comparable new advantages,” or benefits. The California Rule, University of Chicago legal scholar Richard Epstein has written, “Neuters the power of local governments to alter and amend, by wiping out all government flexibility to correct prior errors in pension program design or funding.” One result, he observes, “is a financial death spiral” in many municipalities.

The proper term for this is “suicide pact.” That’s what these states have created. A city that cannot raise taxes to pay its bills has to cut spending. If they are prohibited from cutting these pension deals, then they must cut other stuff. Fewer cops and fewer bureaucrats probably sounds good to libertarians, but they have never been to places like Philly or Baltimore. Fewer cops and fewer locals on the city payroll means my neighbors are coming to your neighborhood.

We see that spiral in California, where a number of municipalities entered bankruptcy in recent years, thanks in part to their inability to alter their unaffordable pensions. Courts, meanwhile, have short-circuited reform attempts. Voters in the city of San Jose, where pension costs have risen to $245 million, from $73 million in 2002, passed a ballot initiative in 2012 installing a new, less expensive pension system. But in December, a California judge invalidated the key changes, based on her interpretation of state court precedents.

The decision leaves California municipalities facing a bleak future. From 2006 through 2013, local governments that participate in the giant California Public Employees’ Retirement System saw their annual pension costs double, on average. Last year, the CalPERS board voted to require an additional contribution increase of 50 percent, phased in over five years. “While there is time to plan for the increase, the most fiscally stressed municipalities could find the increases unmanageable,” Moody’s wrote. Meanwhile, California governor Jerry Brown has signed off on another plan to rescue the state’s struggling teachers’ pension fund by requiring school districts to increase their annual contributions from $2 billion this year to $6 billion over the next seven years.

At some point, the money runs out and there’s no way to hide it. The outflow of tax payers from California is going to accelerate. Eventually, the pols will have no choice but to turn on the rich of San Francisco and Los Angeles. That will be fun to watch, but rich people only respond to force, so they will not pay up no matter how much the politicians complain. It will have to get very ugly first.

Legislators in Illinois have taken a different approach. Their state constitution bans changes to pensions, and costs have soared for both the state and its municipalities. Last year, legislators passed changes in defiance of constitutional protections, arguing in court that the state faces a “severe financial crisis” that makes reform “a valid exercise of the state’s reserved sovereign powers.” Unions are now challenging the reform law, and if they succeed, Illinois faces a $187 billion pension tab—equal to more than four times its revenues—with no plan to reduce the debt.

Illinois has lots of company. Without some way to amend the terms of retirement plans, states and municipalities groaning under the so-called California Rule face years of increasing costs and pressure on budgets that inevitably mean higher taxes and fewer services—in other words, the worst of both worlds.

Illinois will never pay those debts. In fact, none of these states with swollen pension obligations will pay those debts. Then we will learn that economists were wrong about public debt. For decades they have been arguing that debt has no negative impact of economic growth. In fact, they have consistently argued that debt boosts growth. That’s true until the point when the debtor cannot pay his debts. Then the whole thing collapses into an Argentine crisis.

That’s always been the big lie within modern economics. Debt and money creation are nothing more than the pulling forward of revenue. If you imagine a nation’s economy as a balance sheet, raising debt to fund current consumption is a zero sum game. It is just an accrual. You artificially increase revenues today, but that entry is reversed out down the line, when the debt is repaid. Our decreasingly robust recoveries from recessions are due to the metastasizing debt.

What happens when the retirees learn they will not be getting paid is not entirely unknown. They will default on their debts. The people holding those debts will follow suit. If a state like California does default on its debts, things will get very ugly in America. There are simply too many people depending on those debt payments for there to be no serious consequences to the economy at large.

I’ve often thought that the next constitution will have a few provisions in response to the inevitable debt crisis that is coming our way. One is there will be serious limits on government borrowing. Frankly, outside of war, the Federal government should never be borrowing. At the state level, debt should be limited to asset backed lending. The state pledges a bridge or road as collateral. Otherwise, government is prohibited from issuing debt.

The other change is that citizens vote where they are born. The people of California who voted for lunatics are the real problem. They should not be allowed to move to a neighboring state and begin ruining their new home by voting for lunatics. Look at the states ruined by Californians moving away from their mess. Oregon, Washington, Colorado, New Mexico used to be sensibly run states. New Hampshire was ruined by lunatics from Massachusetts. Vermont was ruined by New York lunatics.

Wade Was LeeBonged

I’m laughing very hard watching the toadies in the sporting press line up to fellate LeeBong this summer. The letter his people crafted worked as intended and the full force of the liberal press is out promoting LeeBong Inc. I give the guy a lot of credit for hiring smart people and letting them run his affairs. One sports guy not falling for it is the thoroughly cynical Ron Borges.

If NBC is looking for contestants for the next season of “The Biggest Loser” they can start with Dwyane Wade.

Wade now understands what Cleveland Cavaliers owner Dan Gilbert felt like four years ago when he was jilted by LeBron James and temporarily lost his mind. Put your trust in someone who says, “I’m all about business,” and you’ll probably end up getting the business from him eventually.

Four years ago James stuck it to a city, but at least the team he played for deserved it to a degree because in seven years they didn’t give him much help. This time he only stuck it to one guy but that guy, Wade, damn sure didn’t deserve to be “Clevelanded.”

LeBron James was supposed to be more than Dwyane Wade’s teammate. He was supposed to be his friend. But, hey, cash is thicker than blood (at least when it’s in an $88 million pile), which is way thicker than water and considerably thicker than whatever bound James to Wade apparently.

Two weeks ago Wade joined James and Chris Bosh, and opted out of the remaining two years of his contract and the $41.8 million guaranteed to him by the Heat, ostensibly to make room for Miami to do what it could to keep the Big Three together. Only problem was The Big One wasn’t staying.

Any chance he could have given Wade a wink or a nod? Any way he could have left an anonymous tweet in Wade’s direct message box saying, “Ixney on the opt-out!”? Might he have considered saying, “Think twice, my brother, because you ain’t my brother, brother!”?

He might have, but instead he did to Wade what he did to the Cavaliers and the city of Cleveland. LeBron James played him.

LeeBong is not a dumb guy. He’s not a genius, but by the standards of the NBA is an elite intellect. Unlike most of these knuckleheads he is trying to build something that will outlast his playing days. To do that means you have to be selfish. In this case, it means walking away from his current team and playing the role of the prodigal son returning home. Like the people managing his life, he always has a suitcase packed and the care idling in the parking lot, ready for a quick escape.

Maybe he didn’t do it consciously. Maybe he really believes he didn’t know he left his heart in Akron, but the idea that it just hit him in the last week that, as he put it on SI.com: “My relationship with Northeast Ohio is bigger than basketball. I didn’t realize that four years ago. I do now,” is ludicrous.

Where Wade goes from here is an open question. Not surprisingly after a dalliance with the Houston Rockets that convinced them to deal away point guard Jeremy Lin and a draft pick to the Lakers to open up cap space for him, Chris Bosh reversed field and went back to Miami last night, agreeing to a five-year, $118 million contract. Houston offered him the max at four years and $88 million, but Miami could give him the extra year and an additional $30 million, and Bosh, having learned something from watching LeBron, snatched it.

At 32 and with aching knees, Wade is not in the same boat. At times this year he seemed to have become the third wheel of the Big Three. When healthy he can still play like D-Wade, but when his knees are aching he plays like Lil Wayne, if he plays at all.

To save them and improve the Heat’s chances of getting at least to “not two rings,” Miami rested him for 28 games. He averaged only 33 minutes all season and played only nine games in 31 days going into the Eastern Conference finals. Yet he still faded in the championship series. He wasn’t alone, by the way.

Since he opted out, the Heat owe him nothing, but could admit he opted out more to help them keep LeBron than to feather his own nest. Coupled with all he’s brought to the franchise, maybe they pay him fairly, but he won’t get paid like Bosh or James did, and unless Pat Riley has lost his mind, he won’t get paid like he was going to be paid two weeks ago either, whether he stays or leaves.

In the end, Dwyane Wade sacrificed himself for his team and his friend, but it was all for naught.

Welcome to the other side of the NBA, Dwyane.

The reason teams like to have veterans on teams is to help the young guys figure out the reality of life as a pro. One of the things they need to figure out is they only have so many years. At 20, a player may think he will play forever. At 30 most have figured out they have only a few years left. The guys who figure this out early tend to have better career, assuming they avoid the things black players tend not to avoid.

James watched Wade fall apart over four seasons. He knows life after basketball is right around the corner and he better be ready for it, even if that means using and abusing his friends in the game. This move back to Cleveland is all about LeeBong Incorporated producing cash long after LeeBong in out of the league. That and giving the white fans another reason to worship their black heroes.