Coyote Blog

Many libertarians like state's rights because it creates 50 different tax and regulator regimes, and libertarians assume that people and businesses will flow to the most free states.  However, California progressives have discovered they like state's rights as well, though they are in more of the antebellum South Carolina category of desiring state's rights in order to be less free than the Federal government allows.

After a bid to launch a California secession movement failed in April, a more moderate ballot measure has been approved, and its backers now have 180 days to attain nearly 600,000 signatures in order to put it up to vote in the 2018 election.

The Yes California movement advocated full-on secession from the rest of the country, and it gained steam after Donald Trump won the presidential election in 2016. However, as the Sacramento Bee noted, that attempt failed to gather the signatures needed and further floundered after it was accused of having ties to Russia.

But as the Los Angeles Times reported this week:

“On Tuesday afternoon, Atty. Gen. Xavier Becerra’s office released an official title and summary for the initiative, now called the ‘California Autonomy From Federal Government’ initiative.”

The new measure that seeks to set up an advisory commission to inform California’s governor on ways to increase independence from the federal government. It would reportedly cost $1.25 million per year to fund “an advisory commission to assist the governor on California’s independence plus ‘unknown, potentially major, fiscal effects if California voters approved changes to the state’s relationship with the United States at a future election after the approval of this measure,’” the Los Angeles Times reported.

With Becerra’s approval, its backers can now seek the nearly 600,000 signatures required to place the measure on the 2018 ballot.

As the outlet explained:

“The initiative wouldn’t necessarily result in California exiting the country, but could allow the state to be a ‘fully functioning sovereign and autonomous nation’ within the U.S.’”

According to the Attorney General’s official document on the measure, it still appears to advocate secession as the ultimate goal — even if it doesn’t use the term outright.“Repeals provision in California Constitution stating California is an inseparable part of the United States,” the text explains, noting that the governor and California congress members would be expected “to negotiate continually greater autonomy from federal government, up to and including agreement establishing California as a fully independent country, provided voters agree to revise the California Constitution.”

This is good news - the Oklahoma Attorney General is challenging sue and settle endangered species listings as a violation of the required rules-making process.

Environmentalists are trying to list such ubiquitous species as prairie chickens in order to halt oil and gas development in most of the west.  Presumably, wind farms would be given a special exemption.

Apparently the Feds are using banking regulation to strangle businesses, even legal ones, that they don't like by cutting off their access to the banking system (via Overlawyered).

Wall Street Journal reporter Robin Sidel, along with Andrew Johnson, reported on the success that the federal government is having in barring access to the banking system for a number of businesses. As we've discussed previously, "Operation Choke Point" and related arm-twisting efforts by the Feds are aimed at making life difficult for a variety of targeted businesses. Among those disfavored businesses are online lenders, payday lenders, check cashers, virtual currency dealers, gaming businesses, and marijuana-related businesses (although our beloved US Attorney General has been making noises that he simply will look the other way when it comes to enforcing federal drug laws against marijuana businesses that are operating legally under state law)....

In the article and a companion audio interview, Sidel states that the primary concern appears to be with the difficulty of complying with BSA and money laundering risk. While that's certainly true with many of the businesses, it's also true that some of the businesses have been targeted by the regulators for extra scrutiny because they're in a line of business, like payday lending, where the regulators simply don't like the business model on social policy grounds. If we see the Feds back off of weed but still keep the heat on payday lenders, then the argument that it's all about money laundering risk becomes a bit tenuous.

From our shutdown order:

Congress has not provided appropriations for fiscal year 2014.  Pursuant to applicable legal requirements in the Antideficiency Act and Attorney General opinions addressing agency operations in the absence of appropriations, the Forest Service is unable to administer federally-owned recreation facilities.  Consequently these facilities will be shut down and posted accordingly with signs provided, with gates locked where they exist, restrooms locked, and water systems shut down.   Visitors in occupied sites would be given 48 hours to vacate, with the area shut down as the last visitor leaves, not to exceed 48 hours.

In other words, we pay all the bills, run the parks in an independent manner, have no USFS people stationed in the parks, but we have to shut down because the Forest Service can no longer "administer" the facilities.  Huh?  What day-to-day administration is necessary.  Remember that the USFS itself did not think their presence was necessary, originally confirming on Tuesday that we would stay open as we had in all past shutdowns.

We often go weeks and months in these facilities without ever seeing a USFS manager.  The USFS considers it so important to have staff available to "administer" these facilities that none of their recreation personnel work on weekends or on holidays, by far and away the busiest and most difficult times in these facilities.

PS-  I see the part about the Attorney General.  Did Eric Holder decide to close us?  Doesn't he know that poor and minorities disproportionately use public vs. private recreation?  Isn't that a disparate impact issue in closing us?

Martha Coakley, former Massachusetts Attorney General, is apparently running for Governor of that state after her failed bid to be Senator.

Walter Olson has a round-up of Coakley's various abuses of power, which start with her shameful hounding of the Amirault family against all reason and facts, apparently for the sole purpose of self-aggrandizement.  Unfortunately, all too frequently AG's are rewarded for prosecutorial abuse in the form of media attention and often election to higher offices (Janet Reno rode witch hunts of day care operators very similar to Coakley's into the White House).

The day care worker witch hunt was one of the more bizarre events to occur in my lifetime.  I even sat on a jury of such a case, the only jury I have ever been on.  You have heard of copycat murders?  This turned out to be a copycat false accusation.  It eventually became clear that the teenage babysitter who made the main accusations really wanted to be on the Oprah show, and saw how other day care and child abuse whistle blowers had been interviewed by Oprah.   I kid you not.   By the time of this case, defense lawyers had become wise to the prosecutors' game of using brainwashing techniques to try to get small children to make bizarre sexual allegations against adults in the case.  So the defense was able to highlight the extremes that a couple of state psychologists had gone through to effectively break one poor 6 year old girl.  It was sickening, and it took us about 15 minutes to acquit.   But this is the type of behavior Ms. Coakley and her staff were engaging in.

Or so says California's Gavin Newsom, in a great Reuters quote found by Zero Hedge:

California Lieutenant Governor Gavin Newsom says he wants the U.S. Department of Justice to investigate "threats" against local communities considering using eminent domain to seize and restructure poorly performing mortgages to benefit cash-strapped homeowners.

Newsom sent a letter on Monday to U.S. Attorney General Eric Holder asking federal prosecutors to investigate any attempts by Wall Street investors and government agencies to "boycott" California communities that are considering such moves.

"I am most disturbed by threats leveled by the mortgage industry and some in the federal government who have coercively urged local governments to reject consideration" of eminent domain," he wrote in a letter, a copy of which was provided to Reuters.

Newsom, a Democrat who was previously mayor of San Francisco, warned the influential Securities Industry and Financial Markets Association in July to "cease making threats to the local officials of San Bernardino County" over the proposed plan to seize underwater mortgages from private investors.

Some towns in San Bernardino County, which is located east of Los Angeles, have set up a joint authority that is looking into the idea of using eminent domain to forcibly purchase distressed mortgages. Rather than evict homeowners through foreclosure, the public-private entity would offer residents new mortgages with reduced debts.

Newsom said in the letter on Monday that while he is not endorsing the use of eminent domain at this time, he wants communities in California to be able to "explore every option" for solving their mortgage burdens "without fear of illegal reprisal by the mortgage industry or federal government agencies."

This quote is so rich with irony that it is just delicious.   Certainly ceasing to do business in a community that threatens to steal all your property strikes me as a perfectly reasonable, sane response.   Calling such a response an actionable threat requiring Federal investigation just demonstrates how little respect California officials, in particular, have for private activity and individual rights.

The third paragraph might be worth an essay all by itself, classifying a voluntary private boycott as illegally coercive while treating use of eminent domain, intended for things like road building, to seize private mortgages as so sensible that it should be sheltered from any public criticism.

Andrew Thomas was very competitive in Radley Balko's Worst Prosecutor of the Year voting.  But if he had just waited a few days, this news could have easily put Thomas over the top:

The same people responsible for tens of millions in claims being filed against Maricopa County are now drooling after their own pot of gold.

Former Maricopa County Attorney Andrew Thomas and David Hendershott, Sheriff Joe Arpaio's former right-hand man have filed a notice of claim along with Thomas' former lackey, Lisa Aubuchon, for a combined total of $60 million.
Aubuchon had already filed a $10 million claim; she's revised that to $22.5 million. Andrew Thomas, who quit the job voters gave him and failed in his bid to become state Attorney General, has the gall to seek $23.5 million from taxpayers. And Hendershott, the infamous Chief Deputy now under investigation following a co-worker's allegations of corruption and abuse of power, wants $14 million.

For the first time in my life, I voted in a partisan primary for the Coke/Pepsi parties this year specifically to vote against Thomas.  I cannot even imagine why they think they deserve this kind of payoff.  If anyone should be suing, it is the citizens of Maricopa County who should be suing these three.  Lots of articles about him on my site, but this one in the ABA Journal covers a lot of the ground.

Thank goodness for the drug war so we can have crappy asset forfeiture laws that allow this:

You're free to go -- but we'll keep your money.

That's the position of Arizona Attorney General Terry Goddard on the failed case of Mario de la Fuente Manriquez, a Mexican media millionaire accused of organized crime.

Manriquez was arrested and charged earlier this year with 19 counts of money laundering, assisting a criminal syndicate, conspiracy and fraud. Seven other suspects, including Manriquez's son, were arrested in the alleged scheme to fraudulently own and operate several Valley nightclubs and exotic car dealerships.

Charges against Manriquez's son, Mario de la Fuente Mix, were dropped in August. And on Monday, as we reported, the state moved to drop the case against Manriquez.

But the state still wants to keep $12 million of Manriquez's money that was seized in the case, a spokesman for the AG's office tells New Times today.

The folks involved don't strike me as particularly savory characters, but due process is due process and if you drop charges against the guys, the money should be considered legally clean, especially when the authorities confess

Prosecutors acknowledged the money funneled to the United States from Mexico was earned legitimately by Manriquez. In the end, they couldn't prove he knew what was happening with his dough.

What happened to the money, by the way, is that is was invested in a series of businesses that appear to be entirely legal, their only apparent crime being that the incorporation paperwork omitted the name of Manriquez as a major source of funds.  Wow, money legally earned invested in legal businesses, with the only possible crime a desire for confidentiality (at worst) or a paperwork mistake (at best).  Sure glad our state AG is putting his personal time in on this one.

I do not know Arizona's forfeiture laws, but if they are like most other states', they probably allow state authorities to keep the seized money to use as they please, an awfully large incentive for prosecutorial abuse.

Like many libertarians, I am tempted not to vote each election, though I usually do.  However, choosing between whatever lesser evil exists in the Coke or Pepsi party gets tiresome.  Given that, I have never voted in a party primary, until yesterday when I voted in the Republican primary simply to vote against Andrew Thomas for state Attorney General.  Thomas has for years been Joe Arpaio's chief enabler and of late as County Attorney has spent his time launching frivolous lawsuits against his political enemies, from County supervisors to judges.  When attorneys from adjacent counties would not support his suits, he sought criminal charges against them.

Most recently, it was revealed that a series of grand juries, which typically will indict an inanimate object, not only refused to indict in several of his cases but ordered him to shut down the investigation entirely.  This useless prosecution of a County Supervisor turned out to be part of a plan.  When Thomas decided to vacate the County Attorney position to run for state DA, he disagreed with many of the County Supervisors as to who his replacement should be, and as narrated in this letter, began filing charges against Supervisors to deny them a quorum  (apparently some quid pro quo discussions, of the sort "we will drop the charges if you vote how we want" were actually recorded and turned over to the US Attorney, so if Thomas should win his election we be following the NY/Spitzer path of having our top state legal officer facing felony charges and disbarment.

Unfortunately, Thomas (and Arpaio) have somehow become folk-heroes among lame-brained Arizona voters, who tend to accept any sort of civil rights violations by officials as necessary measures to maintain the peace in the face of the dreaded Mexican immigration wave, so their re-election chances are not necessarily hurt by near Louisiana or Chicago levels of abuses of power.

I was tempted not to vote -- you know, one vote won't matter -- because I felt downright icky actually voting in the Coke primary.  But in AZ, the Coke primary is pretty much the election since the state is so full of Coke voters, so I did it.  As it turns out, my vote may matter.

99.7% of Precincts Reporting
(2232 of 2239 Precincts)

Don't know a thing about Tom Horne, but I eagerly voted for him as not-Thomas.  Here is the lock of the week:  with a vote this close, Thomas will keep this in the court for months, perhaps years.  If he gets the wrong decision, he will go after the judge, and if that doesn't work.....

Update: Apparently, Arpaio got his guy elected in the race to fill Thomas's county attorney seat, so I suppose once we get rid of one Arpaio-enabler we just end up with another.  I took Arpaio's list of people he endorsed yesterday and the only votes I cast were for whoever the challenger was to team Arpaio.

Update #2: This is a depressing quote (emphasis added)

Oddly, the truth-telling was attributed to our own local Pinocchio, Sheriff Joe Arpaio, in regards the decisive victory of Bill Montgomery over interim Maricopa County Attorney Rick Romley.

"That's going to make my job very easy," Arpaio said of Montgomery's win.

I have been saying for years that some sort of due process needs to be applied to Gitmo detainees.  I am not knowledgeable enough to know if this should be a civilian trial or military tribunal or what, but just the fact that they are non-citizens does not give us the right to detain them indefinitely without due process.  Yeah, I get the POW/battlefield analogy, but one also has to reasonably admit the nature of this process today is different than in, say, the defined battlefields with combatants in uniforms in WWII.    The very question of who is a combatant is unclear, so it merits more due diligence to make sure these assertions are made correctly.

Anyway, I suppose I am happy KSM is getting some sort of due process.  But I must say I absolutely hate the precedent being set here -- no, not the one the Conservatives are worried about, bringing a terrorist to trial in a civilian court.  I don't like the precedent of a trial where the government promises that there is already a pre-determined outcome.  US Attorney General Holder seems to be saying there is no possibility of acquittal, but a trial without a possibility of acquittal is not a trial.

This may not be of much interest to regular readers, but is being posted so future recipients of this letter may find this article when searching in Google. 

I got this in the mail the other day (click to enlarge)

It is laid out to mirror the typical format of a state annual report or business license renewal form.  It purports to be from a government-sounding "Board of Business Compliance."  The layout and wording is very similar to the California State required annual report form, as is the $125 fee the letter claims is "now due."  Only in the really fine print near the bottom right does it admit to being a business solicitation. 

Beware.  Despite all their efforts to fool you, filling out this form and filing this $125 fee is not required by any government agency.   I am not sure if you pay money to this group whether you will actually receive any services (I did not pay).  But I will observe that there is absolutely no way that a third party could create a legally meaningful set of minutes for your company based on the information in this form.  Remember, though, that it is important for small corporations to keep their minutes in order -- but I am pretty sure this is not the best way to do it.

Business that must be obtained this way is not worth having, at least in my book. 

Postscript:  One might ask, how can anyone fall for this?  The biggest problem is the government itself.  Doing business in 12 states, 20 counties, and a number of large municipalities, I get literally a hundred "legitimate" forms like this requiring a $50-$150 filing fee from government institutions all the time.  This form, at first, looks more legitimate than say, the application for egg license I get from two states (which are in fact real government requirements). 

PPS:  Don't even get me started on yellow page vendors, directory listing providers, and companies claiming your URL registration is expiring.

UPDATE: Apparently one of the commenters included contact information at the California AG.  The AG's office has written me asking to have comments and concerns about this issue routed to a different address.  I think poor Mr. Wayne was deluged with a bunch of complaints.  Here is what they sent me as their preferred alternative contact information:

 

Complaints may be filed with the California Attorney General's Office by mail, telephone, fax, the Internet, or email:

 

MAILING ADDRESS:

 

Attorney General's Office
California Department of Justice
Attn: Public Inquiry Unit
P.O. Box 944255
Sacramento, CA 94244-2550

TELEPHONE:   1-800-952-5225 (Toll-free in CA) or (916) 322-3360

 

FAX:   (916) 323-5341

WEBSITE:   http://ag.ca.gov/consumers

 

EMAIL:   piu@doj.ca.gov

At a recent meeting of the National Associate of State Treasurers
(Yawn), John Podesta, after stating hilariously that what the world
really needed was continued leadership by state treasurers on the
global warming issue, argued: 

"Climate change is a threat to the long-term value of the economy and
failure to calculate its impacts or manage or reduce its harm mean that
our assets are being over valued, and the risks we face are being under
reported."

I have a lot of interest in global warming, which is why I created a second blog Climate Skeptic to deal with these issues.  There is a lot about anthropogenic warming we do not understand.  But what is nearly a total 100% lock is that, at least for the United States, the cost to our economy of regulations to limit CO2 will be far higher than the likely net-negative effects of warming (Al Gore's 20 foot sea level rises and other anti-rational claims notwithstanding).  At its heart, isn't the risk really of damage from government regulation, rather than the climate?

Via Michael Giberson of Knowledge Problem, the NY Attorney General is concerned that certain companies are not disclosing global warming-related risks, but he is at least more honest about what those risks are:

Last Friday, New York Attorney General Andrew Cuomo sent subpoenas
to five power generating companies seeking to find out if the companies
had properly disclosed financial risks associated with proposed new
coal-fired power plants.

All five of the letters accompanying the subpoenas are available from the NYAG's website.  Here is the opening paragraph of the letter to Dominion Resources, Inc.:

We are aware that Dominion Resources, Inc., ("Dominion")
has plans to build a coal-fired electric generating unit that would
generate 585 megawatts of electricity without current plans to capture
and sequester the resulting carbon dioxide (CO2) emissions. The
increase in CO2 emissions from the operating of this unit, in
combination with Dominion's other coal-fired plants, will subject
Dominion to increased financial, regulatory, and litigation risks. We
are concerned that Dominion has not adequately disclosed these risks to
its shareholders, including the New York State Common Retirement Fund,
which is a significant holder of Dominion stock. Pursuant to the
Attorney General's investigatory authority under New York General
Business Law § 352, and New York Executive Law § 63(12), accompanying
this letter is a subpoena seeking information regarding Dominion's
analysis of its climate risks and its disclosures of such risks to
investors.

A little later, the letter gets more specific: "For example, any one
of the several new or likely regulatory initiatives for CO2 emissions
from power plants "“ including state carbon controls, EPA's regulations
under the Clean Air Act, or the enactment of federal global warming
legislation "“ would add a significant cost to carbon-intensive coal
generation, such as the new coal plant planned by Dominion." In
addition to Dominion, the NYAG's office sent subpoenas to AES, Dynegy,
Peabody, and Xcel. Here is the story from the New York Times.

The letter doesn't say so explicitly, but I'm sure the message was
clear, that in addition to new or likely legislative actions and
substantive regulatory initiatives, the companies also faced the risks
and costs associated with being harassed by swarms of officers from the
NYAG's office.

You can see what is going on here -- following in the rich tradition established by the egregious Eliot Spitzer, the NY AG is again overreaching his office's authority and attempting to set regulatory policy rather than enforce it.  But at least he is honest in portraying the main risk to be a government regulatory backlash on these companies.

Thinking about this, couldn't every company put this in their boilerplate?  I mean, for most of us, the number one risk we face all the time is that the government will either do something to us specifically or the economy in general to hurt results.  Let's just have everyone add the line "the government poses a huge risk to our business plan" and be done with it.

Today, the world is a safer place.  Federal Agents from the Department of Homeland Security have siezed my Crest toothpaste.  You can all fly safely now.

Update:  Hey, I have an idea.  The airplane liquids ban makes so much sense, let's promote its author to Attorney General.  Nothing says "able to make clear-headed choices on tradeoffs between security and civil rights" like the liquids ban.  4oz - safe.  4.2 oz - security threat.

A few weeks ago I got my annual "Your Social Security Statement" from the government.  This is a statement carefully crafted to look like it's telling you a lot while at the same time covering up Social Security's dirty little secret.  But with a spreadsheet and 5 minutes of work, one can figure out what is really going on.

The statement shows the total of my social security taxes paid into the system, including the employer share.  It also shows my taxed earnings per year, and my "benefits."  The main benefit is the monthly annuity payment Social Security will make to me after I retire.  My statement shows that $140,139 total taxes have been paid into the system on my behalf over the last 25 years.  Based on these taxes and (this is important) the assumption I and my employer will continue to pay in at least $7440 per year until I retire, I can expect an annuity at retirement age of 67 (under current law, which the statement makes clear can be changed at any time) of $1,985 per month.

So I built a spreadsheet (click to download excel file), going back to my first year of employment.  Each year, I added the social security taxes to savings, and grew the accumulated balance by some interest rate.  For past years I used actuals from the report, for future years I used the $7440 tax number the report uses to calculate the social security payout. 

This allowed me to answer a question:  If I had been able to take these social security taxes and instead put them in a savings plan, and then took the accumulated balance out at age 67 and bought an annuity (at current rates), what would be my monthly payment?  Well, assuming a very conservative after-tax rate of return of 5%, I would have $1,077,790 at age 67 to buy an annuity, which at current rates quoted on the Vanguard site, would give me $7,789 a month until I die.  This return is just about four times the amount I get from having the Social Security Administration manage the money for me instead. Ugh.  Also note that I did not assume "risky" equity investments or whatever straw man anti-reformers are using nowadays.    If I assume a higher return of 8%  (the stock market in the 90's returned something like 18%) then my annuity will be $17,860 per month, or 9 times the Social Security payout.  Double ugh.

In fact, this all opens up the obvious question, what actual rate of return is Social Security paying out on your "premiums?"  Well, in fact we can calculate this with the same spreadsheet.  I plugged in 2% for the interest rate.  No go -- resulting annuity is to high.  Then I plugged in 1%.  Still too high.  Could the government be paying you 0% on your money?  I plugged that in.  Still too high.  In fact, the implied rate of return on my money in the Social Security system is -0.8% a year.  In other words, not only is the government not paying me any interest, they are charging me to hold my money.

Social Security defenders insist that it is not a welfare program.  For example, Kevin Drum quotes this with approval:

The men in my family of my father's generation returned home after serving
their country and got jobs in the local steel mills, as had their fathers and
their grandfathers. In exchange for their brawn, sweat, and expertise, the steel
mills promised these men certain benefits. In exchange for Social Security taxes
withheld from their already modest paychecks, the government promised these men
certain benefits as well.

....These were church-attending, flag-waving, football-loving, honest family
men. They are rightfully proud of providing homes and educations for their
children and instilling the sorts of values and manners that serve them well as
adults. And if I have to move heaven and earth, now that they've retired, the
Republican party is NOT going to redefine them as welfare
recipients.

Fine, let's call it a retirement program.  Well, as a retirement program, it is a really, really big RIPOFF.  Ever worker in this country is being raped by this retirement plan.  In fact, it is the worst retirement program in the whole country:

• As we see above, it pays a negative rate of return
• It is not optional - you go to prison if you choose not to participate
• Unlike a private annuity contract, the government can rewrite your benefits level any time, and you have to take it.  In fact, my statement says "Your estimated benefits are based on current law.  Congress has made changes to the law in the past and can do so at any time.  The law governing benefit amounts may change because, by 2040, the payroll taxes collected will be enough to pay only about 74 percent of scheduled benefits."
• There are no assets backing this annuity!!  An insurance company that wrote annuities without any invested assets backing them would be thrown in jail faster than Jeff Skilling.  The government has been doing it for decades.

A couple of months ago, news-hog Eliot Spitzer had a well-publicized (what else?) suit against H&R Block for not providing high enough returns in its low-income retirement savings accounts.

New York Attorney General Elliot Spitzer [official website] Wednesday launched a $250 million lawsuit [complaint, PDF] against H&R Block
[corporate website], the largest tax preparation service in the US, for
fraudulently coaxing its customers into a retirement account plan that
lost them money. Spitzer said that money in the retirement accounts
decreased over time because the low interest rate did not cover the
fees associated with the account.

Doesn't this exactly match the situation in my social security spreadsheet?  At least H&R Block's customers had a choice whether or not to sign up.

Postscript: As is usual with retirement issues, tax is a messy topic, so I mostly left it out.  My spreadsheet is correct if you call it an "after-tax" rate of return.  This may mean the nominal rate is higher, but it got taxed, or it could posit some tax-free savings alternative to social security.  Note also that we pay income taxes on the amount that gets taxed by Social Security (at least our employee portion).  This means an IRA type replacement for social security would actually have higher returns and dollars at retirement than those in my spreadsheet, because it would eliminate or at least defer income taxes on the premium.

Also note that the analysis is all in nominal dollars, because that is the way the dollars are on my SS statement - there are not inflation escalators in the program.

Postscript #2:  When last social security was a national topic, opponents of reform got a lot of mileage out of the 2001-2002 bear market in stocks.  They would ask, what if people had invested in stocks, they would have lost their money.  Well, as of today, if you had invested every dollar of your retirement savings on the worst possible day, the 2000 peak in the Dow, you would still be up 5% today.  This is a disappointing  return of less than 1% annually, but is STILL higher than the negative return in social security.  And remember, we are using nearly the worst five year before and after dates in this generation.  A real-world steady investment in stocks over the last 20 years, with equal amounts each year, would be way up  (anyone with an exact number is welcome to post it in the comments).

Postscript #3:  In an earlier post, I took on Social Security as intellectual welfare:

Advocates for keeping forced savings programs like Social Security in
place as-is by necesity argue that the average American is too stupid,
too short-sighted, and/or too lazy to save for retirement without the
government forcing them.  Basically the argument is that we
are smarter than you, and we are going to take control of aspects of
your life that we think we can manage better than you can.  You are
too stupid to save for retirement, too stupid to stop eating fatty
foods, too stupid to wear a seat belt, and/or too stupid to accept
employment on the right terms -- so we will take control of these
decisions for you, whether you like it or not.  For lack of a better
word, I call this intellectual welfare.

Update #1:  In response to some comments, the spreadsheet does work right, it is just labeled wrong.  The column that is labeled "investment income" is actually the saved balance to date plus the investment income.  The "End of Year" column is the correct balance at the end of year after investment income and new contributions.

Update #2:  A commenter reasonably points out that investment at the top of the market in the Nasdaq would still be way underwater.  However, I took this point investment on the worst day as an extreme example.  Even in the Nasdaq, which is still off 50% from its peaks, a steady monthly investment from 1997 or 1998 to date would be above water in total.  Leftists do a lot of bad things for the country, but trying to scare average workers away from equity investments for the long-term is certainly on of the most hypocritical.  I guarantee that every liberal politician has a big fat chunk of their savings in equities, because they know that is the way to create wealth over the long haul.

Update #3:  In a follow-up post, using this same spreadsheet, I conclude that only 17% of my Social Security taxes are going to my retirement while 83% are welfare for someone else.

My business had its worst results in five years.  Where is my disaster aid?   So while the California Attorney General is suing car makers for global warming and the state is rolling out an anti-warming plan, the Governator is seeking disaster aid for a big freeze?  Seems like they are working against themselves.

I think the citrus farmers should file a class action suit right away against makers of fuel efficient cars and hybrids.  I mean, wouldn't that be hilarious?

For the past 6-months, gas station owners have been under attack by state regulators for their pricing practices just after Katrina, when fears of shut-in Gulf oil production and refining capacity led to a temporary spike in gas prices.  Gas station owners have tried to patiently explain about supply and demand and market dynamics, but to no avail, and are starting to settle:

Sunoco Inc. became the second oil company to
settle a price gouging lawsuit brought by New Jersey authorities,
agreeing to pay $325,000 but admitting no wrongdoing....

As part of a state probe into all oil companies doing business
in New Jersey, more than 100 violations were found at 400 gas
stations in the first week of September, the most common of which
were prices being raised more than once every 24 hours, and
stations showing different prices at the pump compared to their
posted prices, officials said.

Nobody is really getting fined hundreds of thousands of dollars for changing their prices more than once in a day.  Gasoline retailers are getting fined for being unliked, and because politicians find it a populist boon to their reelection to wack on oil companies every once in a while.  One of the reasons that gasoline retailers get fined for petty crap like this is that they are the only retail industry that I know of that actually posts their prices so you can see them on the street when you drive by.  A while back we also highlighted this funny bit of high-handedness in Illinois:

Illinois State Attorney General Lisa Madigan asked 18
operators whose prices jumped significantly after Hurricane Katrina to
donate $1,000 to the American Red Cross or risk a potential consumer
fraud lawsuit, reports the Chicago Tribune.

And you just knew enemy-of-Antarctica and Aspiring Governor Eliot Spitzer couldn't miss out on the populist fun:

Illinois isn't the only state to go after retailers for
price gouging after Hurricane Katrina; New York Attorney General Eliot
Spitzer fined 15 operators $10,000 for pumping up their prices.

Anyway, I guess we still haven't gotten to the "consistency" thing I mentioned in the title.  Having been at the receiving end of such ill-conceived and populist price-gouging and anti-trust lawsuits, what is the gas station trade group doing this week?  Why, appearing in front of Congress to accuse someone else of price-gouging.  In this case, they have dragged credit card companies in front of Congress to demand action on interchange fees:

All consumers pay more at the store and at the pump" as
a result of high interchange rates, added Mierzwinski. He also noted
that "legally suspect" practices have led to market power of the card
associations, and that banks engage in a variety of deceptive practices
to steer customers toward higher transaction fees, such as charging
customers who use PIN debit, as opposed to signature-based debit, which
is much less secure yet carries a higher transaction fee to the
retailer.

Of course, he is all for free markets, as he says with this pious piece of BS:

I believe in the light of day and I believe in free
markets," noted Armour, in explaining what retailers are--and
aren't--seeking with regard to interchange. He stressed that retailers
are not requesting price caps and price controls, but rather a better
understanding of why U.S. interchange rates are so high.

Right.  Then why are we dragging these people in front of Congress, except that you want to use the coercive power of government to change their business practices?  If you have Ralph Nader's PIRG behind you, then you are looking to weild the government's hammer to achieve something you couldn't achieve through free, voluntary association and negotiation.

As a retailer, credit card companies piss me off too, but I don't run to Uncle Sam for relief.  I just don't accept certain types of cards, like ATM cards with PIN verification, since they cost a fortune in fees.   And in a lot of locations, I don't accept cards at all.  We have put ATM's onsite in a lot of places, reasoning that if consumers want debit card convinience, they can pay the fees by using the ATM machine and then paying us in cash.

This holiday season, several gasoline retailers found extortion notes from the state AG in their stockings.  In Illinois:

Illinois State Attorney General Lisa Madigan asked 18
operators whose prices jumped significantly after Hurricane Katrina to
donate $1,000 to the American Red Cross or risk a potential consumer
fraud lawsuit, reports the Chicago Tribune.

I would define consumer fraud as getting something from a retailer different than was promised.  I am not sure how it is fraud if retailers put their prices on a great big sign right on the street, and then actually charge those prices as promised.  Unfortunately, we seem to have filled positions of political power with the economically ignorant, who are stuck on cost-based pricing:

"When we're in an emergency situation, such as we were,
retailers have the obligation not to increase their prices to the
general public over what wholesalers are charging them," Hagan told the
Associated Press.

Uh, why?  Retailers move their markup around all the time.  Most every retailer has drastically higher markups on December 1 for Christmas tree ornaments than they do on December 27, but no one seems to complain.  Workers increased the price of their labor post-Katrina, sometimes by a factor of three, and their costs weren't going up at all, so why weren't they gouging?  Its just bizarre how we treat gasoline so much different than every other product we buy.  Perhaps its because they are the only retail product that actually posts their current prices right on the street. 

As I read this article, AG Hagan reminded me of my least favorite Aspiring Governor, fellow Princetonian and enemy-of-Antarctica Eliot Spitzer.  So it was funny when the article continued on to discuss similar actions taken by Spitzer.  This was the quote I loved:

Spitzer told the Press & Sun-Bulletin that
he "hoped it would send a clear message to others that 'you cannot,
under New York law, use an environmental emergency to raise prices.'"

OK, but can I use a massive supply-demand imbalance caused by an environmental disaster to raise prices?  And I sure bet that politicians can use an environmental emergency to raise taxes  (in fact, since NY's gas tax is a percentage of the price rather than fixed, the state of NY did indeed contribute to the post-Katrina price hike). 

Here is my quote back to Mr. Spitzer:

"I hope to send a clear message that the state Attorney General position cannot be used for grandstanding forays against innocent but unpopular business entities* in order to raise one's profile to run for higher office"

*See Dick Grasso, Microsoft, et al.

Update:  More at Professor Bainbridge on Elito Spitzer  (and here)