Sunday, May 29, 2011

Brown v. Plata

This is the case that stunned California. It allows the federal court to require that the state reduce prison overcrowding by, obviously, reducing the prison population. I suspect that everyone (Republicans, Democrats, me) expected that the Supremes would overturn the lower court decision. After all, prisoners aren't a favored population group and given the willingness of the Court to run roughshod over the rest of us, no one expected that decision. California's prison overcrowding (and the consequent denial of medical treatment) was so egregious that even a very moderate court wasn't willing to countenance it.

A bit of background. California's prisons have been overcrowded for a long time. Democrats would argue that it's because Republicans gained a great deal of political favor with the electorate by being "tough on crime." And that's true. But it's also true that the Democrats didn't fight very hard. In fact, they didn't fight at all. So our state's political leadership reformed prison sentencing by lengthening them to Jim Crow state standards, changed the law to make it difficult for the mentally ill to avoid said long prison sentences, and generally insured that lots more people who were a lot sicker would go to prison for long periods of time. The voters joined in, most notably with the "three strikes" ballot initiative, which has on occasion, sent people to prison for 25 years to life for stealing a pizza.

By 1990 the prison situation was becoming intolerable. Prisons were seriously overcrowded, prisoners with physical health problems weren't getting needed treatment, and the increasing number of prisoners who had serious mental health problems was stretching the system beyond breaking. The federal court spent a long time trying to deal with the issues, but finally concluded that the prisons were too crowded to afford adequate medical care to inmates and that the solution was to reduce the number of prisoners. Other options were, of course, to build more prisons and hire more medical staff, but the prison system already consumes a disproportionate share of California's budget, and there are relatively few medical professionals who want to practice in prisons at all, particularly in prisons in remote areas.

It's unlikely that simply reducing the prison population will solve the problem, of course. If the lowest-level offenders are released (which I think is the idea), the remaining prisoners, particularly those with mental health problems, may still not get the help they need. Caring for people who are psychotic in a prison setting isn't likely to improve their condition. And as the number of older prisoners grows, the prison geriatric wards will become progressively more crowded. Just as medical care will cost more as the population ages, medical care in prison will cost more as prisoners age.

What happens to the prisoners who are released? Some of them will be sent off to county jails to finish up their sentences. This means that some county prisoners will have to be released to make room for them, leaving aside the whole issue of how the state will pay for this. And the counties do expect to get paid. Until 2014, when medically-indigent adults go back on Medi-Cal, county hospitals will become responsible for the care of the released prisoners. County hospitals, which have been on the edge of bankruptcy since the Clinton-Gingrich budget agreement in the '90s, will bear the brunt of this, as the emergency room will become the treatment center of choice.

And it would have been more sensible to do this when the state economy was booming. At least then, ex-prisoners had a chance at a job. Today California's unemployment rate is 12% and people with long, stable employment histories (and no felony convictions) can't get jobs. So many of the former prisoners can't help but end up back in prison--they have no jobs, no stable housing...We're just setting ourselves up for the next installment.

Saturday, May 28, 2011

Peon Does It Again

Once again, Peon is proved right. Christmas sales did not indicate that the economy was going to pick up, but that people had decided, by whatever mean necessary, that their kids were going to have Christmas. Even if it meant they didn't spend a sou on things that weren't absolutely necessary for the next six months. If you follow the link and scroll down to my comment, you'll find that I noted that people had blown their budgets for the next six months.

What irritates Peon is that the practitioners of the Ruling Conventional Wisdom didn't see this. It wasn't that hard. Did we suddenly get a bunch of good-paying jobs? Did employers start passing out bonuses to everyone? Well, not unless you're one of the big boys at the banks. And while I wish I could say that it is clear that those paid large sums of money to add and subtract with competence had blown it, I'm not sure it's true. It's that they live in a world populated by their own kind, and don't see the condition of the vast majority. I see it only because I live it, and I'm not afraid to say so. In fact, I relish saying so, and do so as often as possible.

On Foreclosed Homeowners and Eviction

Peon doesn't generally comment on the practical issues for homeowners facing foreclosure. There are lots of public resources for homeowners, and very few for tenants, which is why I concentrate my energy there. (That's not to say that the resources provide the best information or advice, as many homeowners are better off defaulting than emptying their savings accounts for a loan "modification" that's doomed to failure. But I digress.)

The issue in question came up when a tenant suffered the following: in renting an apartment, the tenant-screening service found that he had been evicted from a previous home. As he'd never been evicted, he investigated further and found that his father (who shares the same name) had suffered eviction after the father's home had been foreclosed. Well and good, except that the father had abandoned the house before the foreclosure sale. There was no reason to evict the owners, as they were no longer living there.

After a Trustee Sale, the lender can, if the former owner has not already moved, serve a three-days notice to quit. Only after the three days has expired can the lender file an unlawful detainer (a court eviction). So if the former owner had already moved, how did the lender do this?

Well, it's likely that this is what happened: the lender's representative, finding no one at home, left a three-days notice at the house. Then after the three days had elapsed, the lender hot-footed it to the local courthouse and filed an unlawful detainer. When the former owner didn't file an answer, the lender obtained a default judgment against the former owner. The case then appeared in the court records and the tenant screening service picked it up.

But, you say, how could the former owner suffer this if he had never received any notice, not the three-days notice, not the lawsuit? Well, both the notice and the lawsuit are supposed to be served in accordance with the rules laid out in the Code of Civil Procedure. The lender can serve the notice to vacate and the unlawful detainer in one of three ways:

1. Handing the papers to you.

2. Handing the papers to a "person of suitable age and discretion" at the property and then mailing a copy of the papers to you.

3. Posting a copy at the property and mailing a copy to you. (Serving the unlawful detainer this way requires the permission of the court.)

As you can see with this, "nail and mail" (number 3) is ineffective notice if the tenant no longer lives at the property. Mail forwarding is remarkably iffy (I've personally received forwarded mail weeks after it was sent), so it would be very possible for an evictee to receive no notice of the court action, or no notice before the court had entered a default judgment for the lender.

Welcome to the second-class citizenship of tenancy in California. What should happen is that, before the lender can get permission for "nail and mail" service, the lender should have to show that it's reasonable to assume that the tenant still lives at the property. But judges are, shall we say, much disposed to sympathy for those who crashed our economy and very likely to treat it as a routine matter. And here we get beyond my skill level. It's possible that the lender's representative lied and said that personal service (#1) or substitute service (#2) was effected. A lawyer might be able to help you vacate the default, but the only guarantee in landlord-tenant law is that the landlord has both the law and the sentiment of the court on his side.

You might ask: why would the lender do that when the property is clearly unoccupied? The answer is simple--and not so simple. First the lender may be concerned that you haven't vacated the property, and doesn't want to be sued for a lockout (changing the locks on an occupied property). Second, some servicer contracts provide extra payment if the lender has to file a court eviction and what better way for the servicer to make some easy income than to evict a tenant who isn't there?

The best course of action is prevention. If you are a homeowner and your home is being foreclosed, notify the lender IN WRITING when you move. If possible, deliver the keys to the lender's representative. Keep copies of any missives you send or receive and get the card of the person who receives the keys. Then make sure that the lender knows your post-foreclosure address. Protect yourself, because you can't expect either the Legislature or the court to take the action to prevent these lender abuses.

Friday, May 27, 2011

Sunday, May 22, 2011

The Day After the Rapture

Now that we know we're not entering the post-Rapture period--no crashed vehicles at the side of the road, for instance--I suppose I should get back to work. Today's work will largely involve the yard, as we will receive our first visit from The Claw since February, and the last one until September. I'll post a picture of the pile when we've finished.

But a couple of notes on my way out. First Dan Walters has this for our edification and delight. The problem is that his proposal takes any downturn in California's fortunes and makes it a lot worse. If it's true that "[w]ith a high tax burden, a dense regulatory structure, a decaying transportation system, still-high housing costs, an uncertain water supply, a failing education system, a chronically imbalanced state budget, and a growing underclass, California is not attractive to the massive investment it needs to employ 2 million jobless workers."

This pessimistic view assumes that California will have at least a decade or two of stagnation. I'm inclined to agree with that, but not because it's the view of William Watkins, an economic forecaster at California Lutheran University. It's because Immanuel Wallerstein noted, on the election of Ronald Reagan in 1980, that we would have to suffer 50 years of neoliberal economics. My optimistic will hated the very idea, but my pessimistic intellect, said, "Yeah, probably." And we're only in year 31. We can expect that the financial powers what be will spend the next 19 years desperately trying to make neoliberalism work, perhaps with a couple more bubbles, if they can find anything to exploit. It's possible that they'll glom onto Social Security, the only resource most Americans have left. The problem with that, of course, is that the boomers are many, and we still do have elections in the US. And of course, because it's the only resource most Americans have left.

So what course of action does Walters propose? Well, let's take a bad situation and make it very much worse. We'll cut government! "Reducing safety net services to the poor, slashing pensions for public employees and prison spending, and increasing college fees and other non-tax revenue would become a stark necessity, not merely a topic for detached political debate." Huh? Have the problems noted above? Then do a bunch of stuff that will make them all a great deal worse. Really trash the place! J noted that it was kind of like the "heightening the contradictions" of some left groups in the 1970s. Make things worse and bring on the Revolution. Uh huh.

Getting down off the soapbox, I'll note a good paper by CEPR's John Schmitt on the respective unemployment policies of Denmark and Germany, and their usefulness in theUnited States. The basic argument is that in a demand crash, Germany's work sharing policies are far more effective than worker training for jobs that don't exist. I skimmed the paper which has formulas (a big no-no if you want me to read it), but you can get the main points here.

Saturday, May 21, 2011

The Rapture

Should you wish to follow the Rapture from New York, you can do so here. As a nonbeliever, I expect that I will still be here tomorrow. What I am curious about, though, is the believers who paid to have their pets cared for after the rapture. They do realize that those left are the sinners and nonbelievers--those who are unworthy of heaven. What makes them think that those who've agreed to care for the pets left behind won't just pocket the money and leave the pets to fend for themselves?

Update at 6:08 PM: No Rapture after all. It appears that everyone is still here.

Schwarzenegger-Free Zone

There's a good article in Capitol Weekly on the unexpected $2 billion in income tax revenue that California's budget planners didn't expect. It appears that, as I noted in April, the rich are doing very well, so well in fact, that they paid $2 billion in taxes that the budget people didn't expect. What's interesting about the whole issue if the frame, of course. The anti-tax Republicans, of course, argue that this means we don't have a revenue problem, but a spending problem. Uh, we received $2 billion, not the $15 billion or so that the budget is out of balance, and most especially, the sum we would need to restore the services cut to the elderly, poor, disabled and the sick.

Then there's the other frame. This is the one that says California is too dependent on wealthy Californians and, implicitly, that we should start taxing poorer Californians more. (When Daniel Weintraub was at the Bee, he was a leading supporter of this argument.) Well, I might suggest that a neoliberal economy is necessarily dependent on taxing rich people, as no one else has any money. And that that is the point of the neoliberal economy--that's how it's supposed to work. One need only look at Third World countries, where the government squeezes the majority of the population, while the rich evade taxes entirely, to see what the "let's tax everyone 'equally'" system leads. It's really a system that squeezes blood from turnips.

Monday, May 16, 2011

Oil Speculation

Sure enough, once somebody actually studied the subject, it turned out that speculation in oil futures is a big part of the market and is pushing up prices. Are we surprised?

And Kevin Hall has been reporting on this for quite some time.

Friday, May 13, 2011


I'm going to be doing a bit of reading. I've limited my reading lately to house magazines and trashy mysteries. Not very edifying unless you wish to confirm that people are still on the stainless steel appliance and granite counters kick. (I've said before that granite counters will soon date a remodel just as avocado refrigerators did in the 1970s.) But I'll be reading up on pensions ( Robin Blackburn's Age Shock: How Finance Is Failing Us, and his now old (2004) Banking On Death: Or Investing In Life: The History and Future of Pensions). I probably should have read these a long time ago, but never got 'round to it.

And I recommend Doug Henwood's series on education in the Left Business Observer. In the olden days when Metropolitan Home was still being published, I remember receiving that and LBO on the same day, and putting aside Metropolitan Home to read LBO first. It states the obvious, that poor kids do less well in school than rich kids, and that the way to address the problem is to get kids out of poverty. But it has cool charts and graphs and stuff.

And I've become addicted to the old Perry Mason series (starring Raymond Burr), which is now available on video. The black and whites are much better than the color episodes--I don't know why--but it shows an LA that no longer exists. Also fun are the episodes in rural areas, areas now overrun by house farms. You can get them at the library.

And Matt Taibbi has the latest installment of the Goldman tales in Rolling Stone, proving that capitalism is a great system for making money.

Wednesday, May 11, 2011

A Clean Kitchen Floor

I used my new exercise ball to help me scrub the kitchen floor. It worked, after a fashion. It's not as easy as being on my hands and knees. I scrub what I can reach from the exercise ball, stand, move the ball, sit, scrub some more. I can't roll around on the ball, or I'll roll right off it onto the floor. But it works much better than mopping from a standing position. (That just doesn't get the floor clean.) I thought about posting a picture of the clean kitchen floor, but decided I was obsessing just a bit too much...

Saturday, May 7, 2011

Some Assertions Never Die

No matter how much evidence there is against them. There's the really old one advocating means testing for Social Security which was shown to be more expensive than just paying the rich old folks their money--unless you started defining "rich" old folks as people making $35K a year. Now there's the one about "structural" unemployment--that the reason people can't find jobs is that they don't have the skills for the "new" knowledge-based economy. All those middle-aged people can't find jobs not because there are not jobs, not because they face age discrimination, no, of course not. It's because they don't have the skills for the jobs that are available. The article was reprinted in The Sacramento Bee from the Los Angeles Times.

I thought this assertion had been thoroughly trashed here and if you're too lazy (as I was) to read the entire paper, summarized here. But in fact, the whole argument is trashed in the third to last paragraph of the article, proving that reporters don't actually think about what they're writing: "[r]etail employment led the way in April, adding 57,000 jobs. Health care and leisure businesses (read: hotels and restaurants) also beefed up payrolls." Yeah, knowledge-based economy, for sure.

Friday, May 6, 2011

Peon's Not Sure It's Real

As the five (5) of you who read this blog know, I've written a blog for California tenants who have the misfortune to live in buildings where the landlord is facing foreclosure. I wrote what became the blog at the end of 2007, when there weren't many of us thinking about this issue. More people have thought about it since then, but it's still a hard slog, particularly here in Sacramento, where our city mothers and fathers have studiously avoided any knowledge of the problem, and haven't been falling over themselves to come up with any help for tenants. Sometimes I feel like a voice in the wilderness, but then I realize that J has to listen to me, whether he wants to or not.

But then something happens. And I think, people are paying attention after all. Someone out there noticed. And it was someone with some power, someone who could do something. Now it's likely that tenant groups, neighborhood organizations and public health officials have been screaming for no little time, but the City Attorney in Los Angeles has finally gone after one of the Bad Boy Banks for illegal eviction of tenants in its foreclosed properties and then allowing the properties to deteriorate so badly that they became public health hazards.

And while Yves Smith doesn't think much of going after Deutsche Bank, the decision to, shall we say, do them first, brought a smile to my face. I noted that Deutsche Bank was particularly badly behaved from the beginning and, having failed to reform even a tiny bit during the crisis, informed Tenants Together last year that they weren't bound by no stinkin' laws. I promise to smile only a little as the case unfolds, but will do a small jig 'round the living room when the tenants who suffered illegal eviction and/or had to live in degraded conditions get the monetary settlements coming to them.

Tuesday, May 3, 2011

I Was So Ready for It To Be Over

The Sacramento Kings (the local basketball team) will be staying in Sacramento for another year. No, please. Not another year of trying to fund a new arena. Not another year of debating whether or not public funds should go to this. (Uh, no public funds for the arena until the grass in my neighborhood park is cut regularly.) No discussions of the jobs created, or not created, by the arena, the hotel rooms occupied by players from good teams, the money spent by the citizenry going to or fro' the games. No discussions of the civic pride in having one of the worst teams in the NBA and their dreadful owners. And please, no discussion of the other uses for the arena--monster truck pulls and concerts. (I LIKE music, so I wouldn't want to go to a concert in a stadium.) Please, please.

But this is such a big issue here that there's been more ink and digital bytes than on the killing of Osama bin Laden. I'm not kidding. The lead story on one local television station was Osama bin Laden, but it was quickly followed by far more time on the Kings. But I guess one of my regular readers was right--this issue is never going to go away.

And I got my exercise ball today. After a bad experience with a local sports' store, I opted to buy from the Kaiser Permanente affiliate. The ball came with all the parts, and it took me about five minutes to fill it. Excellent choice.