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Posts Tagged ‘THE WALL STREET JOURNAL’

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THE REAL “TAKERS”: THE RICH

In Bureaucracy, Business, Politics, Social commentary on May 13, 2014 at 1:42 pm

Ann Coulter, the Republican version of the Miss America Nazi, was devastated by the November 6 defeat of Mitt Romney.

“People are suffering,” she whined. “The country is in disarray. If Mitt Romney cannot win in this economy, then the tipping point has been reached.

“We have more takers than makers and it’s over. There is no hope.”

Ann Coulter

Actually, Coulter was right–but not in the way she thought she was.

The “takers” are not the “have-nots” who depend on government for assistance.  They are the “more-than-haves” who cheat the government of billions in lost tax revenues.

In 2012, Tax Justice Network, which campaigns to abolish tax havens, commissioned a study of their effect on the world’s economy.

The study was entitled, “The Price of Offshore Revisited: New Estimates for ‘Missing’ Global Private Wealth, Income, Inequality and Lost Taxes.”

http://www.taxjustice.net/cms/upload/pdf/Price_of_Offshore_Revisited_120722.pdf

The research was carried out by James Henry, former chief economist at consultants McKinsey & Co.  Among its findings:

  • By 2010, at least $21 to $32 trillion of the world’s private financial wealth had been invested virtually tax-­free through more than 80 offshore secrecy jurisdictions.
  • Since the 1970s, with eager (and often aggressive and illegal) assistance from the international private banking industry, private elites in 139 countries had accumulated $7.3 to $9.3 trillion of unrecorded offshore wealth by 2010.
  • This happened while many of those countries’ public sectors were borrowing themselves into bankruptcy, suffering painful adjustment and low growth, and holding fire sales of public assets.
  • The assets of these countries are held by a small number of wealthy individuals while the debts are shouldered by the ordinary people of these countries through their governments.
  • Local elites continue to vote with their financial feet while their public sectors borrow heavily abroad.
  • First World countries do most of the borrowing.
  • Of the $7.3–$9.3 trillion of offshore wealth belonging to residents of these 139 countries, the top 10 countries account for 61% and the top 20 for 81%.
  • The offshore industry has many levels of protection: Private bankers, lawyers and accountants get paid handsomely to hide their clients assets and identities.  These groups also maintain influential lobbies.
  • Bank regulators and central banks of most individual countries typically view private banks as key clients.  They have long permitted the world’s top tax havens and banks to conceal the ultimate origins and ownership of assets under their supervision, especially those held in off-balance sheet trusts and
    fiduciary accounts.
  • Although multilateral institutions like the Bank for International Settlements (BIS), the IMF and the World Bank are supposedly insulated from politics, they have been highly compromised by the collective interests of Wall Street.
  • These regulatory bodies have never required financial institutions to fully report their cross-­border customer liabilities, deposits, customer assets under management or under custody.
  • All conventional measures of inequality sharply understate the levels of income and wealth inequality at both the country and global level.
  • Less than 100,000 people, .001% of the world’s population, now control over 30% of the world’s financial wealth.
  • The impact on lost tax revenue may be huge–large enough to make a significant difference to the finances of nations.
  • Assuming that global offshore financial wealth of $21 trillion earns a total return of just 3% a year, and would have been taxed an average of 30% in the home country, this unrecorded wealth might have generated tax revenues of $189 billion per year.

Summing up this situation, the report notes: “We are up against one of society’s most well-­entrenched interest groups. After all, there’s no interest group more rich and powerful than the rich and powerful.”

Yet the study reveals two bright spots for countries fed up with being bled dry by those parasites whose allegiance runs only to their wallets.

  1. A huge pile at least $21 trillion of untapped financial wealth has been discovered–monies that can be called upon to help solve the most pressing global problems.
  2. A substantial fraction of this wealth is being managed by the top 50 players in the global private banking industry.

As a result, these findings allow nations’ leaders to:

  • Prevent the abuses that have lead to off-the-books wealth accumulation in the future.
  • Make use of the huge stock of accumulated, untaxed wealth that is already there, as well as the steady stream of untaxed earnings that it generates.

It was Stephen Decatur, the naval hero of the War of 1812, who famously said: “Our country, right or wrong.”

Stephen Decatur

Billionaire tax-cheats like those uncovered in the above-cited report have coined their own motto: “My wallet–first and always.”

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YOUR CALL IS VERY IMPORTANT TO US: PART TWO (END)

In Bureaucracy, Business, Self-Help on November 6, 2013 at 12:56 am

So you’ve spent the last half-hour or more on the phone, listening to one recorded message after another (and probably a symphony of bad music).

And you’re no closer to solving the problem that caused you to phone the company/agency in the first place.

What to do?

  1. Go on the Internet and look up the company’s/agency’s website.  Look for links to their Board of Directors.  Often enough you’ll get not only their names but their bios, phone numbers and even email addresses.
  2. Start looking at the bottom of the website page.  Many companies/agencies put this information there–and usually in small print.
  3. Look for the names of officials who can help you.  That means the ones at the top–or at least high enough so you can be sure that whoever responds to your call/letter/email has the necessary clout to address your problem.
  4. If you call, don’t ask to speak directly with Mr. Big–that’s not going to happen.  Ask to speak with Mr. Big’s secretary, who is far more accessible.
  5. Keep your tone civil, and try to make your call as brief as possible.  Don’t go into a lot of background about all the problems you’ve been having getting through to someone.
  6. Give the gist and ask for a referral to someone who can help resolve your problem.
  7. If the secretary needs more time to study the problem before referring you to someone else, be patient.  Answer any questions asked–such as your name, address, phone number and/or email.
  8. State–specifically–what you want the company to do to resolve your problem.  If you want a refund or repairs for your product, say so.
  9. Too many consumers don’t specify what they want the company to do–they’re so caught up in their rage and frustration that this completely escapes them. 
  10. Be reasonable.  If you want a refund, then don’t ask for more money than you paid for the product.  If you want to return a product for an exchange, don’t expect the company to give you a new one with even more bells and whistles–unless you’re willing to pay the difference in price.
  11. If you want an agency to investigate your complaint, don’t expect them to drop everything else and do so instantly.  Give them time to assess your information and that supplied by others.
  12. It’s usually possible to get one agency to sit on another–if you can make a convincing case that it’s in that secondary agency’s best interests to do so.  If you’ve been roughed up by local police for no good reason, you can file a complaint with that department–-and the FBI and U.S. Attorney’s Office (federal prosecutor) to investigate.
  13. That doesn’t guarantee they will resolve your problem.  But if you can show that the cops have violated several Federal civil rights laws, the odds are that someone will take a serious look at your complaint.
  14. If a company/agency official has acted so outrageously that the company/agency might now be held liable for his actions, don’t be afraid to say so.  But don’t threaten to sue.  Just point out that the employee has acted in such a way as to jeopardize the company’s/agency’s reputation for integrity/efficiency and that the organization is not well-served by such behavior.
  15. Whoever reads your letter/email will instantly realize the legal implications of what you’re saying–and, in most cases, will take quick action to head off a lawsuit by trying to satisfy your request.  The foremost priority of every bureaucracy is to ensure its own survival.
  16. Give the CEO’s secretary at least one to two days to get back to you.  Remember: Resolving your problem isn’t the only task she needs to complete.
  17. If you’re writing the CEO, make sure you use his full name and title–and that you spell both correctly. People don’t get to be CEOs without a huge sense of ego.  Nothing will turn him off faster than your failing to get his name and title exactly right.
  18. As in the case with his secretary, be brief–no more than a page and a half.  Outline the problem you’re having and at least some (though not necessarily all) of the steps you’re taken to get it resolved.
  19. Then state what you want the company to do.  Again, be fair and reasonable.

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YOUR CALL IS VERY IMPORTANT TO US: PART ONE (OF TWO)

In Bureaucracy, Business, Self-Help on November 5, 2013 at 1:15 am

How many times have you called a government agency or company and instantly found yourself put on hold?

To add insult to injury, you usually wind up serenaded by recorded music that would be totally forgettable if it weren’t so unforgivably irritating.

And every 30 seconds or so a recorded voice comes on to assure you: “Your call is very important to us.”

Have you ever wondered: “If my call is so important to you, why aren’t you answering it?” 

The truth is that most companies and government agencies don’t want their employees speaking with the customers who make their existence a reality.

Having your questions answered by another human being requires the company/agency to assign–and pay–people to do just that.

Most hiring managers don’t want to hire any more people than they absolutely have to.  They want to siphon off as much of the company’s profits for themselves as possible.

And assigning people to answer customers’ calls means that many of those calls will take time to answer, because some problems can’t be solved in a matter of seconds.  To a bean-counting executive, time is money.

Even government agencies like police departments don’t want to spend any more time than necessary taking the calls of those who need to reach them.

Even calls to 911 can leave you talking to no one, with only a recorded message telling you to wait until someone deigns to speak with you.

That’s why many bureaucracies arrange that when you call for help, you’re fobbed off with a recorded message telling you to visit the company’s or agency’s website.

This assumes, of course, that

  1. You have a computer; and
  2. If you do, you also have Internet access.

If you

  • Don’t have a computer; or
  • You have a computer but don’t have Internet access; or
  • You do have Internet access but the service is down,

you’re flat out of luck.

And the agency/company couldn’t care less.

But it need not be this way.

Companies and agencies can treat their customers with respect for their time and need for help.

That’s why companies that genuinely seek to address the questions and concerns of their customers reap strong customer loyalty–and the profits that go with it.

One of these is LG, which produces mobile phones, TVs, audio/video appliances and computer products.

LG actually offers an 800 Customer Care number that’s good 24-hours a day.

Its call center is staffed with friendly, knowledgeable people who are willing to take the time to answer customer questions and guide them through the steps of setting up the appliances they’ve bought.

Another company that dares to have human beings stand behind its products–and explain how to use them–is The Sharper Image.

Recently, Dave, a friend of mine, bought an electronic alarm clock that allows you to wake up to a variety of exotic souds–such as a thunderstorm, the seashore, chirping birds or foghorns.

A brochure on how to set the alarm and sounds came with the clock, but Dave couldn’t make sense of it.  Luckily, there was an 800 number given in the brochure for those who needed to be walked through the necessary steps.

Dave called The Sharper Image and quickly found himself connected with a friendly and knowledgeable customer care rep.  She clearly and patiently explained what he needed to do to choose which sounds he wanted to awaken to.

And then she just as patiently repeated that list of steps while he quickly typed them up for future use if he forgot what to do.

Such an approach to customer service is not new–just extremely rare these days.

In his 1970 bestselling primer on business management, Up the Organization, Robert Townsend offered the following advice to company CEOs: “Call yourself up.”

“When you’re off on a business trip or a vacation,” writes Townsend, “pretend you’re a customer.  Telephone some part of your organization and ask for help.  You’ll run into real horror shows.

“Don’t blow up and ask for name, rank and serial number–you’re trying to correct, not punish.  Just suggest to the manager (through channels, dummy) that he make a few test calls himself.”

So how do you cope with agencies/companies that don’t care enough to help their customers?

I’ll address that in my next column.

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CORPORATIONS ARE GREEDY PEOPLE, TOO

In Bureaucracy, Business, Law, Politics, Social commentary on August 29, 2013 at 12:01 am

“How many men ever went to a barbecue and would let one man take off the table what’s intended for nine-tenths of the people to eat? The only way you’ll ever be able to feed the balance of the people is to make that man come back and bring back some of that grub that he ain’t got no business with!”

–Louisiana Senator Huey P. Long, 1934

It was August 11, 2011–one year before he would receive the official Republican nomination for President.

Hustling for votes, Mitt Romney was speaking to a crowd of hundreds at the Iowa State Fair. He was being pressed about raising taxes to help cover entitlement spending.

Suddenly, a heckler suggested raising corporate tax rates.

Romney responded: “Corporations are people, my friend. Of course they are. Everything corporations earn ultimately goes to the people. Where do you think it goes? Whose pockets? Whose pockets? People’s pockets. Human beings, my friend.”

The line earned him a sustained round of applause from the crowd.

If it’s true that corporations are people, then they are exceptionally greedy and selfish people.

A December, 2011 report by Public Campaign, highlighting corporate abuses of the tax laws, makes this all too clear.

Public Campaign is a national nonpartisan organization dedicated to reforming campaign finance laws and holding elected officials accountable.

Related image

Summarizing its conclusions, the report’s author writes:

“Amidst a growing federal deficit and widespread economic insecurity for most Americans, some of the largest corporations in the country have avoided paying their fair share in taxes while spending millions to lobby Congress and influence elections.”

Its key findings:

  • The thirty big corporations analyzed in this report paid more to lobby Congress than they paid in federal income taxes between 2008 and 2010, despite being profitable.
  • Despite making combined profits totaling $164 billion in that three-year period, the 30 companies combined received tax rebates totaling nearly $11 billion.
  • Altogether, these companies spent nearly half a billion dollars ($476 million) over three years to lobby Congress. That’s about $400,000 each day, including weekends.
  • In the three-year period beginning in 2009 through most of 2011, these large firms spent over $22 million altogether on federal campaigns.
  • These corporations have also spent lavishly on compensatng their top executives ($706 million altogether in 2010).

Among those corporations whose tax-dodging and influence-buying were analyzed:

  • General Electric
  • Verizon
  • PG&E
  • Wells Fargo
  • Duke Energy
  • Boeing
  • Consolidated Edison
  • DuPont
  • Honeywell International
  • Mattel
  • Corning
  • FedEx
  • Tenet Healthcare
  • Wisconsin Energy
  • Con-way

The report bluntly cites the growing disparity between the relatively few rich and the vast majority of poor and middle-class citizens:

“Over the past few months, a growing protest movement has shifted the debate about economic inequality in this country.

“The American people wonder why members of Congress suggest cuts to Medicare and Social Security but won’t require millionaires to pay their fair share in taxes.

“They want to know why they are struggling to find jobs and put food on the the table while the country’s largest corporations get tax breaks and sweetheart deals, then use that extra cash to pay bloated bonuses to CEOs or ship jobs overseas.

“….At a time when millions of Americans are still unemployed and millions more make tough choices to get by, these companies are enriching their top executives and spending millions of dollars on Washington lobbyists to stave off higher taxes or regulations.”

Assessing the results of corporate tax-dodging, the report states:

  • Using various tax dodging techniques, including stashing profits in overseas tax havens and tax loopholes, 29 out of 30 companies featured in this study succeeded in paying no federal income taxes from 2008 through 2010.
  • These 29 companies received tax rebates over those three years, ranging from $4 million for Corning to nearly $5 billion for General Electric and totally nearly $11 billion altogether.
  • The only corporation that paid taxes in that three-year period, FedEx, paid a three-year tax rate of 1%, far less than the statutory rate of 35%.

The report bluntly notes the hypocrisy of corporate executives who call themselves “job creators” while enriching themselves by laying off thousands of employees:

“Another area where these corporations have decided to spend lavishly is compensation for their top executives ($706 million altogether in 2010).

“Executives doing particularly well work for General Electric ($76 million in total compensation in 2010), Honeywell International ($54 million), and Wells Fargo ($50 million).

“Executives who have seen the greatest increase work for DuPont (188% increase), Wells Fargo (180% increase) and Verizon (167% increase).

Despite being profitable, some of these corporations have actually laid off workers.

Since 2008, seven of the corporations have reported laying off American workers. The worst offenders are Verizon, which laid off  at least 21,308 workers, and Boeing, which fired at least 14,862 employees.

Insisting that “corporations are people” wins applause from the wealthiest 1% and their Right-wing shills. But it does nothing to better the lives of the increasingly squeezed poor and middle-class.

If the nation is to avoid economic and moral bankruptcy, Americans must demand that powerful corporations be held accountable–and punished harshly when they behave irresponsibly.

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HELL IN THE “RENTERS’ PARADISE”: THREE (END)

In Bureaucracy, Law, Law Enforcement, Social commentary on June 25, 2013 at 12:00 am

Slumlords would have everyone believe that San Francisco is a “renters’ paradise.”  A place where hard-working landlords are routinely taken advantage of by rent-avoiding bums who want to be constantly pampered.

On the contrary: It’s not renters who hold “untouchable” status, but slumlords themselves.

If you doubt it, you need only review the case of slumlords Kip and Nicole Macy.  They waged a two-year war on their rent-paying tenants to force them out of their South of Market building.

The reason: The Macys wanted to get them out of their rent-controlled apartments so they could rent these out to tenants who could afford extortionate rents.

For two years, the police and district attorney’s office stood by while the Macys aimed threats, vandalism, illegal lockouts and violence at their law-abiding tenants.

The Macys have since been convicted and will be sentenced to four years and four months imprisonment.  But this case is a rarity for the San Francisco District Attorney’s Office.

Meanwhile, thousands of San Francisco tenants have lived with rotting floors, nonworking toilets, chipping lead-based paint and other outrages for not simply months but years.

But San Francisco tenants need not be put at the mercy of greedy, arrogant slumlords.  And the agencies that are supposed to protect them need not be reduced to impotent farces.

The San Francisco District Attorney’s Office shcould create a special unit to investigate and prosecute  slumlords.  Prosecutors should offer rewards to citizens who provide tips on major outrages by the city’s slumlords.

And the San Francisco Department of Building Inspection–which is charged with guaranteeing the habitability of apartment buildings–should immediately adopt a series of long-overdue refirms.

By doing so, it can:

  • Vastly enhance its own prestige and authority;
  • Improve living conditions  for thousands of San Francisco renters; and
  • Bring millions of desperately-needed dollars into the City’s cash-strapped coffers.

In Part 2 of this series I outlined 14 such reforms.  In this concluding column, I will outline the remaining eight:

  1. DBI should order landlords to post their Notices of Violation in public areas of their buildings–on pain of serious financial penalties for failing to do so. When DBI orders a slumlord to take corrective action, s/he is the only person who is notified.   Thus, if that slumlord refuses to comply with those directives, s/he is the only one who realizes it.  Given the pressing demands on DBI, weeks or months will pass before the agency learns about this violation of its orders.  Tenants have a right to know if their landlord is complying with the law.
  2. DBI should launch–and maintain–a city-wide advertising campaign to alert residents to its services.  Everyone knows the FBI pursues bank robbers, but too many San Franciscans do not even know that DBI exists, let alone what laws it enforces.  This should be an in-your-face campaign: “Do you have bedbugs in your apartment?  Has your stove stopped working?  Are you afraid to ride in  your building elevator because it keeps malfunctioning?  Have you complained to your landlord and gotten nowhere?  Then call DBI at —–.  Or drop us an email at ——.”
  3. Landlords should be legally required to give each tenant a list of the major city agencies (such as DBI, Department of Public Health and the Rent Board) that exist to help tenants resolve problems with their housing. 
  4. Landlords should be legally required to rehabilitate a unit every time a new tenant moves in, or at least have it examined by a DBI inspector every two years.  A tenant can occupy a unit for ten or more years, then die or move out, and the landlord immediately rents the unit to the first person who comes along, without making any repairs or upgrades whatsoever.
  5. Landlords should be required to bring all the units in a building up to existing building codes, and not just those in need of immediate repair.
  6. Landlords should be legally required to hire a certified-expert contractor to perform building repairs.  Many landlords insist on making such repairs despite their not being trained or experienced in doing so, thereby risking the lives of their tenants. 
  7. DBI should not view itself as a “mediation” agency between landlords and tenants.  Most landlords hate DBI and will always do so.  They believe they should be allowed to treat their tenants like serfs, raise extortionate rents anytime they desire, and maintain their buildings in whatever state  they wish.  And no efforts by DBI to persuade them of its good intentions will ever change their minds.
  8. Above all, DBI must stop viewing itself as a mere regulatory agency and start seeing itself as a law enforcement one.  The FBI doesn’t ask criminals to comply with the law;  it applies whatever amount of force is needed to gain their compliance. As Niccolo Machiavelli once advised: If you can’t be loved by your enemies, then at least make yourself respected by them.

As Robert F. Kennedy wrote: “Every society gets the kind of criminal it deserves.  What is equally true is that every community gets the kind of law enforcement it insists on.”

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HELL IN “THE RENTERS’ PARADISE”: PART TWO (OF THREE)

In Bureaucracy, Law, Law Enforcement, Social commentary on June 24, 2013 at 12:25 am

The “war on drugs” has some valuable lessons to teach the San Francisco Department of Building Inspection (DBI) which is charged with protecting tenants against predatory landlords.

Consider:

  • At least 400,000 rape kits containing critical DNA evidence that could convict rapists sit untested in labs around the country.
  • But illegal drug kits are automatically rushed to the had of the line.

Why?

It isn’t simply because local/state/Federal lawmen universally believe that illicit drugs pose a deadly threat to the Nation’s security.

It’s because:

  • Federal asset forfeiture laws allow the Justice Department to seize properties used to “facilitate” violations of Federal anti-drug laws.
  • Local and State law enforcement agencies are allowed to keep some of the proceeds once the property has been sold.
  • Thus, financially-strapped police agencies have found that pursuing drug-law crimes is a great way to fill their own coffers.
  • Prosecutors and lawmen view the seizing of drug-related properties as crucial to eliminating the financial clout of drug-dealing operations.

It’s long past time for DBI to apply the same attitude–and methods–toward slumlords.

DBI should become not merely a law-enforcing agency but a revenue-creating one.  And those revenues should come from predatory slumlords who routinely violate the City’s laws protecting tenants.

By doing so, DBI could vastly:

  • Enhance its own prestige and authority;
  • Improve living conditions for thousands of San Francisco renters; and
  • Bring millions of desperately-needed dollars into the City’s cash-strapped coffers

Among those reforms it should immediately enact:

  1. Hit slumlord violators up-front with a fine–payable immediately–for at least $2,000 to $5,000 for each health/safety-code violation.
  2. The slumlord would be told he could reclaim 75-80% of the money only if he fully corrected the violation within 30 days.  The remaining portion of the levied fine would go into the City coffers, to be shared among DBI and other City agencies.
  3. This would put the onus on the slumlord, not DBI. Appealing to his greed would ensure his willingness to comply with the ordered actions.  As matters now stand, it is DBI who must repeatedly check with the slumlord to find out if its orders have been complied with.
  4. If the landlord failed to comply with the actions ordered within 30 days, the entire fine would go into the City’s coffers–to be divided among DBI and other agencies charged with protecting San Francisco residents.
  5. In addition, he would be hit again with a fine that’s at least twice the amount of the first one.
  6. Inspectors for DBI should be allowed to cite landlords for violations that fall under the jurisdiction of the Department of Public Health.  They can then pass the information on to DPH for its own investigation.
  7. If the DBI Inspector later discovers that the landlord has not corrected the violation within a designated time-period, DBI should be allowed to levy its own fine for his failure to do so.
  8. If DPH objects to this, DBI should propose that DPH’s own Inspectors be armed with similar cross-jurisdictional authority.  Each agency would thus have increased motivation for spotting and correcting health/safety violations that threaten the lives of San Francisco residents.
  9. This would instantly turn DBI and DPH into allies, not competitors.  And it would mean that whether a citizen called DBI or DPH, s/he could be assured of getting necessary assistance.  As matters now stand, many residents are confused by the conflicting jurisdictions of both agencies.
  10. DBI should insist that its Inspectors Division be greatly expanded.  DBI can attain this by arguing that reducing the number of Inspectors cuts (1) protection for San Francisco renters–and (2) monies that could go to the general City welfare.
  11. The Inspection Division should operate independently of DBI.  Currently,  too many high-ranking DBI officials tilt toward landlords because they are landlords themselves.
  12. DBI should create a Special Research Unit that would compile records on the worst slumlord offenders.  Thus, a slumlord with a repeat history of defying DBI NOVs could be treated more harshly than a landlord who was a first-time offender.
  13. Turning DBI into a revenue-producing one would enable the City to raise desperately-needed revenues—in a highly popular way. Fining delinquent slumlords would be as unpopular as raising taxes on tobacco companies. Only slumlords and their hired lackey allies would object.
  14. Slumlords, unlike drug-dealers, can’t move their operations from one street or city to another.  Landlords aren’t going to demolish their buildings and move them somewhere else.

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HELL IN “THE RENTERS’ PARADISE”: PART ONE (OF THREE)

In Bureaucracy, Law, Law Enforcement, Social commentary on June 21, 2013 at 12:01 am

To hear slumlords tell it, San Francisco is a “renters’ paradise,” where obnoxious, lazy, rent-evading tenants constantly take advantage of hard-working, put-upon landlords.

Don’t believe it.

And in case you’re inclined to anyway, consider the story of Kip and Nicole Macy, two San Francisco slumlords who recently pled guilty to felony charges of residential burglary, stalking and attempted grand theft.

Kip Macy

Nicole Macy

Determined to evict rent control-protected tenants from their apartment building in the South of Market district, they unleashed a reign of terror in 2006:

  • Cut holes in the floor of one tenant’s living room with a power saw–while he was inside his unit.
  • Cut out sections of the floor joists to make the building collapse.
  • Threatened to shoot Ricardo Cartagena, their property manager, after he refused to make the cuts himself.
  • Changed the locks to Cartagena’s apartment, removed all of his belongings and destroyed them.
  • Created fictitious email accounts to appear as a tenant who had filed a civil suit against the Macys–and used these to fire the tenant’s attorney.
  • Cut the tenants’ telephone lines and shut off their electricity, gas and water.
  • Changed the locks on all the apartments without warning.
  • Mailed death threats.
  • Kicked one of their tenants in the ribs.
  • Hired workers to board up a tenant’s windows from the outside while he still lived there.
  • Falsely reported trespassers in a tenant’s apartment, leading police to hold him and a friend at gunpoint.
  • Broke into the units of three tenants and removed all their belongings.
  • Again broke into the units of the same three victims and soaked their beds, clothes and electronics with amonia.

The Macys were arrested in April, 2008, posted a combined total of $500,000 bail and then fled the country after being indicted in early 2009.

In May, 2012, Italian police arrested them and deported them back to America a year later.

Having pled guilty, they will be sentenced in August to a prison term of four years and four months.

How could such a campaign of terror go on for two years against law-abiding San Francisco tenants?

Simple.

Even in the city misnamed as a “renter’s paradise,” slumlords are treated like gods by the very agencies that are supposed to protect tenants against their abuses.

The power of slumlords calls to mind the scene in 1987’s The Untouchables, where Sean Connery’s veteran cop tells Eliot Ness: “Everybody knows where the liquor is. It’s just a question of: Who wants to cross Capone?”

Many tenants have lived with rotting floors, bedbugs, nonworking toilets, mice/rats, chipping lead-based paint and other outrages for not simply months but years.

Consider the situation at the San Francisco Department of Building Inspection, which is supposed to ensure that apartment buildings are in habitable condition:

  • A landlord is automatically given 30 days to correct a health/safety violation. If he drags his feet on the matter, the tenant must live with that problem until it’s resolved.
  • If the landlord claims for any reason that he can’t fix the problem within one month, DBI doesn’t demand that he prove this.  Instead, it automatically gives him another month.
  • A slumlord has to work at being hit with a fine—by letting a problem go uncorrected for three to six months.
  • And even then, repeat slumlord offenders often avoid the fine by pleading for leniency.
  • That’s because many DBI officials are themselves landlords.

But the situation doesn’t have to remain this way.

DBI could:

  • Vastly enhance its own prestige and authority
  • Improve living conditions  for thousands of San Francisco renters, and
  • Bring millions of desperately-needed dollars into the City’s cash-strapped coffers.

How?

By learning some valuable lessons from the “war on drugs” and applying them to regulating slumlords.

Consider:

  • At least 400,000 rape kits containing critical DNA evidence that could convict rapists sit untested in labs around the country.
  • But illegal drug kits are automatically rushed to the had of the line.

Why?

It isn’t simply because local/state/Federal lawmen universally believe that illicit drugs pose a deadly threat to the Nation’s security.

It’s because:

  • Federal asset forfeiture laws allow the Justice Department to seize properties used to “facilitate” violations of Federal anti-drug laws.
  • Local and State law enforcement agencies are allowed to keep some of the proceeds once the property has been sold.
  • Thus, financially-strapped police agencies have found that pursuing drug-law crimes is a great way to fill their own coffers.
  • Prosecutors and lawmen view the seizing of drug-related properties as crucial to eliminating the financial clout of drug-dealing operations.

It’s long past time for San Francisco agencies to apply the same attitude–and methods–toward slumlords.

In my next column I will lay out how this can be done.

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HOW TO BE A SMARTER EXECUTIVE: PART TWO (END)

In Bureaucracy, Business, History, Self-Help on May 14, 2013 at 12:00 am

I returned, and saw under the sun, that the race is not to the swift, nor the battle to the strong, neither yet bread to the wise, nor yet riches to men of understanding, nor yet favour to men of skill; but time and chance happeneth to them all.

–Ecclesiastes 9:11

It is one thing to gain executive power, and another to hold onto it.  It is altogether different to use it wisely and justly.

Many are the dictators who have ruled long, but not justly–such as Porfiro Diaz, whose 30-year regime was ended by the Mexican Revolution in 1911.

And many are those who wanted to rule justly but could not face up to the harsh realities of power.  One of these was Francisco Madero, who democratically succeeded Diaz–but was soon betrayed and executed by Victoriana Huerta, one of his own generals.

In Part One, I outlined a number of timeless suggestions by Niccolo Machiavelli, the Florentine statesman and patriot (1469-1527) for attaining and wisely employing executive power.

Niccolo Machiavelli

Many of this nation’s corporate executives and officials manning local, state and Federal agencies (including the Presidency) would do well to pay close attention to his advisories.  Among these:

  • EVALUATING A SUBORDINATE: For a prince to be able to know a minister there is this method which never fails.  When you see the minister think more of himself than of you, and in all his actions seek his own profit, such a man will never be a good minister, and you can never rely on him.  For whoever has in hand the state of another man must never think of himself but of the prince, and not mind anything but what relates to him.
  • TREATMENT OF SUBORDINATES: And on the other hand, the prince, in order to retain his fidelity, ought to think of his minister, honoring and enriching him, doing him kindnesses and conferring on him favors and responsible tasks, so that the great favors and riches bestowed on him cause him not to desire other honors and riches, and the offices he holds make him fearful of changes.  When princes and their ministers stand in this relation to each other, they can rely the one upon the other; when it is otherwise, the result is always injurious either for one or the other of them.
  • TAKING COUNSEL: There is no way of guarding oneself against flattery than by letting men understand that they will not offend you by speaking the truth.  But when every one can tell you the truth, you lose their respect.
  • A prudent prince must therefore take a third course, by choosing for his counsel wise men, and giving them alone full liberty to speak the truth to him, but only of those things that he asks and of nothing else.
  • MAKING DECISIONS: But he must be a great asker about everything and hear their opinions, and afterwards deliberate by himself in his own way, and in these counsels and with each of these men comport himself so that every one may see that the more freely he speaks, the more he will be acceptable.  Beyond these he should listen to no one, go about the matter deliberately, and be determined in his decisions.
  • SEEK THE TRUTH:  A prince, therefore, ought always to take counsel, but only when he wishes, not when others wish.  On the contrary, he ought to discourage absolutely attempts to advise him unless he asks it.  But he ought to be a great asker, and a patient hearer of the truth about those things of which he has inquired.  Indeed, if he finds that anyone has scruples in telling him the truth he should be angry.
  • UNWISE PRINCES CANNOT BE WISELY ADVISED: And since some think that a prince who gains the reputation of being prudent is so considered, not by his nature but by the good counselors he has about him, they are undoubtedly deceived.  It is an infallible rule that a prince who is not wise himself cannot be well advised, unless by chance he leaves himself entirely in the hands of one man who rules him in everything, and happens to be a very prudent man. In this case, he may doubtless be well governed, but it would not last long, for the governor would in a short time deprive him of the state.
  • FORTUNE: I think it may be true that fortune is the ruler of half our actions, but that she allows the other half or thereabouts to be governed by us.
  • I would compare her to an impetuous river that, when turbulent, inundates the plains, casts down trees and buildings, removes earth from this side and places it on the other; every one flees before it, and everything yields to its fury without being able to oppose it.
  • Still, when it is quiet, men can make provisions against it by dykes and banks, so that when it follows it will either go into a canal or its rush will not be so wild and dangerous.

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WHY REGULAR JOBS PROGRAMS DON’T WORK

In Bureaucracy, Business, Politics, Self-Help, Social commentary on May 2, 2013 at 12:18 am

Imagine this: A future President seeks to disband the FBI—and offer bribes to career criminals to not rob, rape and murder. And to sell his proposal, he chooses as his slogan: “Let criminals be criminals.”

If that sounds impossible, consider this: Politicians on both the Right and Left have adopted just that mindset toward holding corporate employers accountable for their criminal greed and irresponsibility.

Case in point: The Obama administration has signaled that it may adopt a Georgia program that allows businesses to train jobless workers for two months without having to pay them.

Its supporters claim the program—Georgia Works—lets workers get their foot in the door and reduces businesses’ hiring risks. Unions assert that it exploits workers and violates federal labor laws.

The drawbacks to this program:

  • It’s only open to workers receiving unemployment insurance benefits.
  • Businesses have no obligation to hire participating workers.

Mississippi, in turn, has launched the Subsidized Transition Employment Program and Services. Funded with left-over stimulus dollars, it initially covers 100 percent of an employee’s wages, gradually reducing the subsidy for every 160 hours worked.

Its drawbacks:

  • It lasts only four months—from August to December, 2011.
  • Businesses will be excluded from the program if funds are exhausted or the September 30 enrollment deadline has passed.
  • Only 80 companies had signed up for the program by early September.

Then there’s the Minnesota solution. Instead of adopting Senator Al Franken’s proposal to use public monies to subsidize wages, Congress enacted the Hiring Incentives to Restore Employment Act. This gave businesses $13 billion worth of tax credits for hiring unemployed workers.

The drawbacks to this effort:

  • The measure has not been evaluated.
  • It does not require employers to hire.

In Connecticut, another jobs program, Platform to Employment, puts workers through a four-week training period followed by an eight-week tryout at a participating business.

During the tryouts, the employees’ wages are paid by The Workplace, Inc., a private company which raised enough funds to support 100 jobs starting this fall.

The drawbacks to this are:

  • Employers get, in effect, free labor.
  • Only those who have already exhausted 99 weeks of unemployment benefits are eligible.
  • Employers have no obligation to hire participating workers.
  • The funds will create only 100 jobs.
  • Employers are not required to participate in the program.

Meanwhile, the unemployment rate keeps steadily rising. In 2007, 228,000 people were unemployed for 99 weeks or longer, according to the Bureau of Labor Statistics.

Today more than 2 million Americans have been unemployed for at least 99 weeks—the cutoff point for unemployment insurance in the hardest-hit states.

And the longer a person is out of work, the less likely s/he is to find an employer willing to hire.

What all these “job creating” programs have in common is this: They apply plenty of carrots–but absolutely no sticks.

Bribes–in the form of tax credits or tax breaks–are liberally applied to entice employers to behave like patriots instead of parasites. But for employers whose refusal to hire condemns their country to economic catastrophe–there are no penalties whatsoever.

A policy based only on carrots is a policy of bribery. A policy based only on sticks is one of coercion. Some people can’t be bribed, and some can’t be coerced. But nearly everyone is open to a policy of rewards and punishments.

Thus, corporations across the country are now sitting atop $2 trillion in profits. But their CEOs are using those monies for:

  • Enriching themselves, their bought-off politicians, their families—and occasionally their mistresses.
  • Buying up other corporate rivals.
  • Creating or enlarging companies outside the United States.

In short, the one expense they refuse to underwrite is hiring their fellow Americans.

This is because:

  • They want to pay their un-American employees far lower wages than would be tolerated by employees within the United States.
  • They want to escape American employee-protection laws–such as those mandating worker’s compensation or forbidding sexual harassment.
  • They want to escape American consumer-protection laws–such as those banning the sale of lead-contaminated products (a hallmark of Chinese imports).
  • They want to escape American laws protecting the environment–such as those requiring safe storage of dangerous chemicals.

They want, in short, to enrich themselves at the direct expense of their country.

In decades past, this used to be called treason.

Yet no major political figure–on the Left or Right–has so far dared to blame employers for selling out their country and destroying its economic prosperity.

No job-seeker, however well-qualified and -motivated, can hire himself onto an employer who refuses to hire.

But corporate CEOs–and their paid political stooges–continue to blame the unemployed for being unable to find employers willing to honor their integrity, qualifications and initiative.

Related image

Americans generally–and the unemployed and under-employed in particular–must hold corporate America accountable for its criminal greed and irresponsibility.

Until they do, the United States will continue to sink further into decline–economically, socially and politically.

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TAXING CRIMINALS FOR REVENUES: PART TWO (END)

In Bureaucracy, Politics, Social commentary on April 19, 2013 at 12:19 am

Come visit San Francisco and you’ll see all the famous sights so beloved by tourists: Ghirardelli Square, the cable cars, the Golden Gate Bridge.

What you won’t see is one of the biggest blights facing the city: The behavior of predatory slumlords, who own both hotels and apartment buildings.

This behavior-–and the City’s steadfast refusal to change it-–poses a daily threat to the lives of San Francisco tenants. And it poses an equal threat to the City’s long-term ability to sustain its Number One source of revenues: The tourism industry.

To take one example: San Francisco is now facing an infestation of bedbugs. Everyone in the Department of Public Health (DPH) knows it. And everyone in DPH knows that many of the slumlords who own hotels plagued with these creatures refuse to do anything about them.

Bedbug

The reasons are twofold.

First, there’s a stigma attached to bedbugs that isn’t attached even to cockroaches. Roaches are filthy, but they don’t suck your blood. So when people learn that a hotel (including name-brand ones) has a bedbug infestation, they take their business elsewhere.

Second, combating bedbugs can be expensive. The most effective method involves a combination of poisons and heat treatments on a building-wide basis. Most landlords–-and certainly all slumlords––don’t want to take on that sort of expense.

San Francisco depends overwhelmingly on tourism for its revenues. A city whose hotels and apartment buildings are centers of contagion of any kind is a city destined to become a tourist ghost town, not a tourist mecca.

So, how to cope with this challenge? Here’s how:

  1. Greatly expand the Inspection Division at the Department of Public Health (DPH). This agency is legally charged with ensuring the health of San Francisco’s tenants-–both guests and residents.
  2. DPH should demand that a portion of those monies now directed toward entirely tourist-related issues be transferred to its Inspection Bureau. With those monies it can hire additional-–and badly-needed-–inspectors.
  3. Greatly expand the Inspection Division at the Department of Building Inspection–-and       make it independent of the agency. As matters now stand, too many high-ranking DBI officials tilt toward landlords because they are landlords themselves.
  4. End the culture of secrecy at DPH. The Department of Building Inspection is responsible for ensuring compliance with San Francisco building and housing codes. If a slumlord, for example, refuses to fix a tenant’s clogged bathtub drain or replace a window that’s about to fall out, the tenant calls DBI.
  5. DBI’s complaint records are immediately accessible at its website. Copies of its Notices of Violation–-ordering slumlords to correct problems-–can be obtained through the mails by request.  If a tenant wants to learn if other tenants have lodged complaints against his landlord, he can simply go online.
  6. By contrast, DPH offers nothing of this type of informational service.
  7. DPH should immediately make its records publicly available via the Internet, the same way DBI now does.
  8. DPH and DBI should order landlords to post their Notices of Violation in public areas of their buildings–-on pain of serious financial penalties for failing to do so.
  9. When DPH or DBI orders a slumlord to take corrective action, the only person who is notified of this is the landlord.   Thus, if that slumlord refuses to comply with those directives, s/he is the only one who knows about this. Given the pressing demands on DPH and DBI, weeks or months will pass before DPH/DBI learns about this violation of its orders.
  10. DPH and DBI should abandon their “gradual” approach to combating health/safety code violations in slumlord-owned apartments and hotels and hit the owner up-front with a heavy fine, payable immediately.  The landlord could recoup 75% to 80% of this money only if s/he could prove that the health threat had been totally eradicated within 30 days.
  11. If it were not, the slumlord would then be hit with a second fine twice the size of the last one and given another 30 days to correct the problem. So a slumlord hit with a $2,000 fine in January would face a $4,000 fine in February, and an $8,000 one in March.
  12. This would put the onus on the slumlord, not DBI/DPH.  These agencies now give landlords 30 days to correct a health/safety code violation. If the slumlord claims he needs more time, he’s automatically given another 30 days–minimum–to do so. This means the tenant must live with the discomfort–if not threat–of that violation until the slumlord finally decides to correct it.
  13. Inspectors for DPH and DBI should be armed with cross-jurisdiction authority. That is, if a DBI Inspector spots a health/safety violation covered by DPH, he should be able to cite the slumlord for this–and pass this information on to DPH for its own investigation. And the same should apply for Inspectors from DPH.
  14. This would instantly turn DBI and DPH into allies, not competitors. It would also make life far easier for tenants needing help. Whether a citizen called DBI or DPH, s/he could be assured of getting the assistance s/he needed. Currently, DPH and DBI Inspectors often tell citizens, “I’m sorry, that doesn’t lie within our jurisdiction. You’ll have to call—.”

By standing up to predatory slumlords, San Francisco can achieve three goals at once:

  1. Protect its residents and all-important tourist industry from predatory slumlords.
  2. Create new and popular sources of revenue for its cash-strapped public services.
  3. Set a shining example for other cities and states for how they can do the same.