secession

[keith in RI]

i found this on another forum..... thought it was interesting.
http://market-ticker.denninger.net/archives/1505-To-The-States-Should-We-Talk-About-Secession.html



To The States: Should We Talk About Secession?

I'm going to go back to this quote by Barney Frank of the US House, because it says everything those in state and local governments need to know:

    Barney Frank, the Massachusetts Democrat who is chairman of the House Financial Services Committee, said in an interview that the defaults were, in essence, worth it.

    "I don't think it's a bad thing that the bad loans occurred," he said. "It was an effort to keep prices from falling too fast. That's a policy."

Got it?  It's a policy to screw the state and local governments.

Huh, you say?  It's simple, really: State and local governments rely on property tax revenues.  Yet defaulted mortgages don't pay property taxes.  Yes, there's a lien on the property but this doesn't help the municipal budget now.

And suffer they are:

    Tax revenues used to pay teachers and fuel police cars continue to trail even the most pessimistic expectations, despite the cash from the economic stimulus plan pouring into state coffers.

    "It's crazy. It's really just unbelievable," said Scott Pattison, executive director of the National Association of State Budget Officers, and called the states' revenue situations "close to unprecedented."

These shortfalls are a direct consequence of the intentional action of not only refusing to prosecute financial fraud and the making of unsound loans for years, but of continuing the game-playing even now as an official federal government policy.

This game goes back to the former Fannie accounting scandals, as a recently-discovered set of documents from a law firm that threatened a discrimination and whistleblower retaliation suit show:

    "There is no explanation which I can see which justifies amortizing beyond 100% of an asset's value.  Having made those arguments with Janet and Dick and having lost, I have to hope their knowledge of the factor generation and cash flow modeling processes includes expertise which I do not have."  (Roger Barnes, internal email, October 2002.)

Well I don't understand a reason for justifying amortizing an asset beyond 100% of it's value either, but when we get down to 2 + 2 = and the answer is something other than "4".....

We have a regulatory environment where The Federal Government has intentionally left out of the Federal Legal code strictures on operating a bank while insolvent, when many states explicitly define such an act as a felony, thereby giving The Federal Government cover in allowing banks to operate long enough to generate 20, 30, 40 and even 50% losses as measured against their asset base before being closed.  To date nobody has been criminally charged in relationship to these events.

We have banks that are intentionally sitting on "NODs" (Notices of Default) and foreclosure actions, with many people in bubble areas not having made a payment in more than a year.  There are those who view this sort of thing as "good" for the economy (since those individuals continue to spend in the local economy instead of being evicted.)  Banks are doing this to avoid having to take the "mark" on the defaulted asset; by refusing to recognize the current value of those assets as the recovery value and instead holding the note at "par" or near to it, they effectively cook their books and appear healthier than they are.  Government is allowing this and claiming that it is "for the good of the economy" to keep these blown-up banks in business but along with the default on the mortgage comes a default on the impound account (if there is one) which means state and local governments are not receiving their property tax revenues.

We also have banks that have homes that have either "jingle mailed" or otherwise been left empty, and the banks are refusing to sell these properties off for the same reason - maintenance of these "assets" at unrealistic values on the books of these firms.  This also results in the property tax bills not being paid as there is nobody living in these homes and nobody making the payments to state and local governments.

It has become clear during the last two years that despite the royal screwing that is imposed on state and local governments as a direct consequence of these actions Federal regulators, lawmakers and administration officials will not step in and put a stop to it, as they are fully bought and paid for by the financial industry.

As a direct consequence of this intentional blindness state and local governments are being forced to lay off school teachers, firefighters, police officers and severely curtail other normal activities for lack of funds.  The Federal Government in turn is plying the States with "stimulus" money but that amount is nowhere near the amount of the shortfalls being generated by these policy decisions.

Make no mistake: This is not about protecting "the broader economy."  It is about one and only one thing: covering up the bogus accounting and embedded losses these firms are carrying so they can pay their bonuses and indeed remain in business while the local, county and state governments are serially violated by the bankers and organs of the federal government.

States must stand and say "no more!" to these policies.  Fraud is fraud and papering it over doesn't make it less crooked.  The states are entitled to their funds irrespective of whether the federal government wants to protect big banking interests on Wall Street, and must not be used as a scapegoat in this latest game of "hide the truth."

State governments must rise and demand an end to the banking and balance sheet games.  Failing such an attempt they must pass 10th Amendment recognition laws with the full force of law behind them and then begin to bring criminal charges against those institutions that are improperly holding defaulted property off the market or allowing people who remain in homes who are not paying their mortgages - or taxes.  If The Federal Government will not investigate and bring charges then The States must indict under their own consumer protection and anti-fraud laws and issue 50-state Governor's Warrants as required.

I believe it is time for State Governments to openly question whether The Federal Government has violated the contractual limits and stipulations of the US Constitution on an ongoing basis for more than two decades, and whether The States should remain within a Union where one party violates the rights and privileges of the Other Parties with impunity and malice aforethought.

Despite the calls of some who scream "racism!" and similar echoes of the 1860s this debate is not only proper now it is proper at any time; all parties to a contract are charged with continual assessment of whether the terms are being met, and it is never "over the line" to raise the question or hold an open debate on this account.

Many claim that The War Between The States was "only" over slavery.  But contemporary documents of the time make clear that this was not the case; to wit, Georgia:

    The manufacturing interests entered into the same struggle early, and has clamored steadily for Government bounties and special favors. This interest was confined mainly to the Eastern and Middle non-slave-holding States. Wielding these great States it held great power and influence, and its demands were in full proportion to its power. The manufacturers and miners wisely based their demands upon special facts and reasons rather than upon general principles, and thereby mollified much of the opposition of the opposing interest. They pleaded in their favor the infancy of their business in this country, the scarcity of labor and capital, the hostile legislation of other countries toward them, the great necessity of their fabrics in the time of war, and the necessity of high duties to pay the debt incurred in our war for independence. These reasons prevailed, and they received for many years enormous bounties by the general acquiescence of the whole country.

Hmmm... perhaps slavery was an excuse rather than the actual cause?

The Constitution is in fact the contract under which each State entered the Union.  All contracts may be renegotiated, but none may be violated unilaterally.  By refusing to comport with equal protection under the laws of the land as demanded by same and by stepping into what are clearly intrastate matters with judicial and legal activism, as was done with Bush's interference with state predatory lending laws and other similar abuses, along with government refusing to stop bogus accounting that threatens state tax revenues and fiscal health The Federal Government is acting not as a party to The Constitution in concert with the States of this Union but rather as an insane monarch who has used The Constitution as toilet paper and then discarded it into the trash.

The States must demand that these violations be immediately cured and should the Federal Government refuse the States must both indict on their own initiative the bad actors in this economic mess and consider declaring themselves free of the bonds imposed by the Constitution, not by virtue of their desire to violate its' letter and intent but rather as a consequence of the other side's refusal to recognize that the original agreement still exists.

(And by the way, for those who can't read English very well, nowhere within this Ticker - or anywhere else - have or will I advocate violent overthrow or activity of any sort.  Not only is such an act unlawful but I am fully aware of the fact that it is highly likely that any such action will not lead to a "more free" nation, but rather a Hitler-style fascist dictatorship - simply based on the lessons of history.)

[Little Owl]

I've always been intrigued by the idea of secession, but we'd need some pretty serious guarantees that, assuming success, the republic we create doesn't become more oppressive than the one we'd be leaving.  To that end, we'd need some pretty solid protections in place before such a movement even began.

[Tunga]

You know back in the '70's Gov. Thompson tried to have the National Guard in New Hampshire outfitted with nuclear weapons.

That what you mean by protections Owl?

[Little Owl]

I mean besides the protections we're all familiar with, we would need a framework that would prohibit the economic nanny state we have today.  Such protections are largely absent from the existing U.S. Constitution.  Specifically I'd like to see:

- No victimless crime laws.
- Prohibition on any sort of compulsory government Ponzi schemes (Socialist Security, Medicare, Nationalized Health Care, etc.)
- Broad-based prohibition on appropriation for, or spending on, anything not explicitly stated in the constitution.
- Prohibition of any government involvement in education whatsoever.
- Prohibition on any form of "positive right" (ie. entitlement).

There could be more; these are just a start.

-100 Karma?!?  Who did you piss off?

[Ogre]

Sadly, I think everything you address already IS covered by the Constitution. And I think the people who wrote the Constitution would agree that all those things are already there (perhaps with the exception of victimless crime laws, because at that time, they were just considered absurd).