The architect of the bill, Congressman Barney Frank, calls his own bill the payment of an economic ”ransom,” admitting that it rewards irresponsible people by bailing them out.   His excuses for paying this ransom are decidedly lame.  Moreover, his bill contains political pork for left-wing special interest groups like La Raza and the National Urban League. 

Last month, Congress created a long-run threat to the insurance industry by passing the Genetic Information Non-Discrimination Act (GINA).  GINA also regulates employers in ways that I criticized in 2005 in the National Law Journal.

But there could be an even greater cost from the bill to millions of middle-class investors saving for their retirement or the education of their children. The bill has the Federal Housing Administration guarantee the refinancing of a mortgage in return from a “haircut” from the owners of the loan. The bill requires loans to be guranteed at no more than 90 percent of the value, meaning a 10 percent loss for investors. But this haircut will “shave” billions of dollars off from funds saved for retirement or education.

This bill not only “robs Peter to Pay Paul,” through taxpayers bailout of bad loans by banks and borrowers. It can also be said to “abrogate Paul’s contract to Peter.” This is because many of the mortgages often aren’t owned by the banks that service them, but frequently by millions of middle class investors through their interests in entitities that have mortgage-backed securities (MBS).

Many middle-class folks who have 401(k) accounts, mutual funds, money market funds or defined-benefit pensions are indirect holders of MBS. In fact, according to investment bank Credit Suisse, 14 percent of MBS are owned by pensions and mutual funds that serve middle-class savers.

So, let’s do some math. The bill authorizes the FHA to guarantee up to $300 billion in mortgages. With the 10 percent haircut, the loans were originally worth $333 billion. So $33 billion represents the potential lost savings by the private sector. Now assume a random 14 percent of the loans in this program represent those owned by pensions and mutual funds. 14 percent of $33 billion is $4.6 billion.

The bottom line is that middle-class savers and investors could be left with almost $5 billion less for retirement and education of their children. Another compelling reason this bailout is not worth the cost.

Courts frequently engage in flagrantly inconsistent legal reasoning in order to first impose liability on employers and then maximize and collect damages in sexual harassment cases, and they often disregard the statutory requirements that harassment plaintiffs seeking compensatory damages show that they were harassed based on their sex, and subjected to intentional discrimination. 

I don’t like raunchy radio programs, but that doesn’t mean the government should ban listening to them, much less do so under the weak argument that they constitute sex discrimination.

Ted Frank has an editorial in the New York Sun on this disturbing court ruling.

This ruling was from an intermediate appellate court in New York (the Appellate Division’s First Department), but don’t expect any help from New York’s highest court (the New York Court of Appeals).  That court, as I have noted before, is even worse, with several really rotten judges like Chief Judge Judith Kaye. 

The Brady Center to Prevent Gun Violence has claimed that the law violates “separation of powers” by changing the outcome of pending court cases (an argument that, if taken to its logical conclusion, would require invalidating the 1964 Civil Rights Act because it legislatively overturned trespass convictions of civil-rights demonstrators who engaged in sit-ins).  I earlier commented on the Brady Center’s hypocrisy in claiming that it is “judicial activism” for judges to strike down gun bans based on the Second Amendment, but not judicial activism for judges to strike down the democratically-enacted PLCAA based on unwritten separation-of-powers principles.

CPS workers have an incentive to seize children, since the federal government gives states incentives for seizing and adopting out children, and CPS workers are more likely to be fired for failing to prevent child abuse than for wrongly seizing children, even if the seizure itself causes the child devastating psychological harm.

I wrote earlier about how temporary seizures of infants based on erroneous accusations later found to be false can become permanent, when courts rule that the infant has become attached to her foster family and thus should not be returned even if the alleged abuse that led to the seizure did not actually occur.   I also discussed the violation of due process involved in the mass seizures of children in the strange FLDS religious sect, hundreds of whom were seized based on a single, anonymous, allegation of abuse by a caller pretending to be a teenager in the sect, and who continue to be held without any hearing on whether they individually are endangered (although the removal of some of the children might well be warranted if it occurred after a full judicial hearing).

The ABA’s actions violate 42 U.S.C. 1981 and the Supreme Court’s ruling in Gratz v. Bollinger (2003), which held in footnote 23 that racial quotas violate 42 U.S.C. 1981 (which bans both private and public discrimination) as well as the Fourteenth Amendment (which bans only governmental discrimination).  Moreover, the ABA and its accreditors are liable for pressuring GMU to engage in racial discrimination under 42 U.S.C. 1981, which allows not only employers and other institutions to be held liable for racial discrimination, but also individual discriminators.  And GMU and its president and law school dean, who were personally summoned to appear before the ABA in order for them to be pressured to maximize GMU’s racial quotas, have standing to sue over those quota mandates under Lutheran Church-Missouri Synod v. FCC, 141 F.3d 344 (D.C. Cir. 1998), which held that the Lutheran Church had standing to sue the FCC to keep the FCC from pressuring it to take race into account in hiring employees for its religious radio stations in order to satisfy a ”diversity” mandate.  (Note that GMU is a state university).