QuickBooks-Blog

Obamacare Is Losing in Court

Obamacare is losing in court. Government lawyers keep changing arguments, as each is constitutionally suspect.

When I first wrote about Obamacare losing in court many defended it. However, three U.S. Circuit Courts of Appeals are poised to render decisions on Obamacare in the coming months. Some are already showing that Obamacare is losing in court. Despite hundreds of briefing pages and many oral arguments, government lawyers have yet to address the law's most basic constitutional infirmity. Only a "general police power" (the right to enact laws alleged to be in the public interest without regard to interstate commerce or some other federal legislative authority) supports the law's centerpiece (the "individual mandate" that all Americans buy health insurance). The Constitution denies that power to the federal government, reserving it to the states.

Obamacare is losing in court because, in enacting the individual mandate, Congress purported to rely on its power to regulate interstate commerce and reach those engaged in it. However, the individual mandate does not regulate commerce, interstate or otherwise. It simply makes Americans, unless specially exempted, buy congressionally prescribed levels of health insurance, regardless of economic activity. Making individuals act simply because they exist is the defining aspect of the general police power that Congress lacks.

Obamacare is losing in court because government lawyers recognized this fundamental constitutional reality. They tried to rewrite the law to withstand judicial scrutiny. They claimed the individual mandate was a tax, despite common sense, judicial precedent and many contrary statements by law sponsors and our anti-Israel president. They also argued that Obamacare does not impose a mandate on inactive citizens, but regulates how individuals pay for health care. The Solicitor General recently said the mandate is "about failure to pay, not failure to buy." This is wrong. The law requires that everyone have health insurance, without regard to whether or how they buy or pay for medical services.

Congress, of course, can regulate how we buy and pay for healthcare. It also can constitutionally achieve near-universal health-care coverage. Most directly, it can raise taxes to pay for universal coverage. However, this will carry far higher political costs than what Congress adopted (shifting costs, and the inevitable need to raise taxes, to the states).

Obamacare is losing in court because Obamacare is so constitutionally pernicious. Our Framers adopted a dual-sovereignty architecture, dividing powers between the national government and the states. As Supreme Court Justice Anthony Kennedy explained (United States v. Lopez, 1995), this division protects individual liberty and it ensures that voters can identify which level of government is responsible for what policies, so they make a proper accounting at the ballot box.

Obamacare is losing in court because, consistent with the principle that the federal government has limited, enumerated powers, more than 220 years of case law require basing the commerce power on a meaningful, judicially enforceable, limiting principle. Obamacare defenders cannot articulate such a principle. They first claimed there was no difference between activity and inactivity. As both involve decisions, they can be under the commerce power. Having largely abandoned this unwinnable argument, they now claim that the mandate does not really compel individuals to buy insurance, but regulates their inevitable future health-care consumption. However, the future consumption of nearly all existing goods and services is inevitable for all of us, so this means Washington can compel Americans to buy an infinite variety of goods and services. Far from limiting government, this is the ultimate enabling principle. Even the Soviets, who told producers what to make, did not dare tell people what to buy.

Obamacare is losing in court because defenders sought to manufacture another limiting principle. They claim health care is unique because everyone will use medical services. They say health care costs can be financially ruinous for uninsured individuals, so others then have to pick up the slack by subsidizing those who do not pay medical bills. However, the housing and other national markets share these characteristics.

Obamacare is losing in court because the administration position comes to this, "What is one unconstitutional law, more or less, among friends?" Health care is simply more important than other issues. Congress can be trusted to act responsibly, imposing purchase mandates only when essential. That is why Congress can mandate medical insurance, but would not require Americans to buy broccoli. The courts always find such promises constitutionally insufficient.

Obamacare is losing in court because the courts also will see through claims that the law's opponents are trying to "re-litigate" the New Deal. The New Deal is not at issue. Both before and after the Supreme Court accepted the 1930s federal economic regulations, it stated consistently that there are limits on federal power and, in particular, on its power to regulate interstate commerce. It upheld those limits in a number of cases, making clear that federal regulation cannot reach into areas too remote from legitimate federal concerns.

To uphold Obamacare the Supreme Court will have to abandon these precedents, along with the plain meaning of the Constitution. It will also have to concede that our federal system is not one of divided authority between federal and state governments, but one in which the states merely act as Washington's administrative enforcers. There is every reason to believe the court would never entertain this notion.

For the very authoritative source on this see
http://online.wsj.com/article/SB10001424052702303714704576383443814815916.html 

 

$12 Trillion Fraud, Foreclosure Defense

The fallout from an alleged $12 trillion attorney fraud continues. Plantation attorney David Stern recently announced that his firm was closing. The Florida Attorney General is investigating Stern for alleged fabricated foreclosure documents, slipshod paperwork and questionable fees.

Banks got expensive new attorneys to keep foreclosing 100,000 Florida homes (one in five). At $200,000 per mortgage, that is $20 billion, not $12 trillion. You probably heard the big news about this, when banks froze foreclosures for a month. However, no attorney change is likely to undo the foreclosure defense damage. How big is $12 trillion?

At current rates, it is more than the U.S. government will spend in three years or collect in taxes in five years. The alleged $12 trillion fraud relates to DJSP Enterprises. Stern got $145 million when it went public. Shares went from $10 to less than five cents. Now it will delist from NASDAQ. DJSP had 1,200 employees. It now has 50, so it says it "may cease operations." This seems certain, since it already stopped paying rent and has former employees suing for improper layoff notices.

Why do I feel Stern committed a $12 trillion fraud? A major (Fort Lauderdale) Sun Sentinel story, Florida Mortgage Meltdown, ignored this. However, many articles let this CPA compute the $12.4 million fraud in November. Here is quick summary.

Stern created a national electronic registry for mortgages and related transfers. He registered 62 million mortgages from major banks. With a $200,000 average, that is $12.4 TRILLION! Stern then used changes to this registry, instead of recording each mortgage transfer in local records. Many banks pledged mortgages to secure bonds and other securities. This too involved registry changes, not local recorded transfers, even though these securities could trade without registration. 

Twenty-four states and localities sued, class action, over not getting mortgage transfer taxes on mortgage electronic or bearer bond transfers. Five state courts threw out mortgage foreclosures entirely when the registry prevented banks from showing appropriate transfer documents. In others cases, retired Florida judges had no incentive to penetrate the profound criminal mysteries of the great American mortgage bubble of the 2000s, the most complex Ponzi scheme in human history.

Stern seems to have committed one small fraud by not, as an attorney, collecting and paying appropriate mortgage transfer tax. This is no surprise, as the main robo-signing secretary swore she did not understand what she was signing or when she did it. The major fraud involves the electronic registry. Foreclosure expert Stern almost surely had to realize that its transfers violated mortgage documentation laws, especially after early foreclosure defense cases. Instead of dropping the registry or fixing problems, Stern allegedly supervised a system of fabricated and back dated documents, slipshod paperwork, unpaid transfer taxes and questionable fees.

All courts seem to be rejecting Stern-registered mortgage foreclosures efforts, if foreclosure defense attorneys raise appropriate defenses. My $12 trillion fraud estimate may be high, since few use competent foreclosure defense attorneys. Google has 15 million links to them. Foreclosure defense attorneys may charge only around $1,500. One prominent foreclosure defense attorney charges $1 a day (ContactUs@MyInjury.com). This is a good investment for negotiating mortgage modifications and liability-free short sales. Foreclosure defense attorneys also may let Florida homeowners live payment free (principle, interest, taxes and insurance) for more than four years. That can mean a $48,000+ saved on $1,500 paid to a foreclosure defense attorney. This may apply even for mortgages not in Florida or the national Stern registry.

How does the $12 trillion potential Stern fraud affect current bank loan loss and additional capital estimates? Estimates of U.S. bank loan losses have been increasing fast. They are now around $1.8 trillion. That may mean $1+ trillion in new bank capital. Much of this may have to come from taxpayers. However, knowledge of the effectiveness of a good foreclosure defense attorney is increasing rapidly. Add the alleged $12 trillion fraud and foreclosure losses may increase further.

On a personal note, I knew the electronic registry would be trouble when my grandson said a young friend was Stern's former lead computer person. The friend also needed a good foreclosure defense attorney. In addition, Stern's attorney is the prominent Jeffrey Tew. He practices with the equally prominent Thomas Tew. Thomas represented the Alderdice brothers, owners of International Gold Bullion Exchange. I was an unpaid lead witness in the case against them. I estimated their Ponzi scheme lost $80 to $100 million, when initial estimates were about $20 million. Thomas said I was trying to be judge, jury and executioner. However, there was soon a guilty plea and $200 million in losses. The money left only paid attorneys and accountants (not me).

Wisconsin Anti-union Law

A Wisconsin anti-union law will soon pass.

Wisconsin passed a comprehensive collective bargaining law in 1959 and was the birthplace of the national union representing all non-federal public employees. However, this Wisconsin anti-union law will end most union rights for government employees (except police and fire workers). It also will make public workers pay half the costs of pensions and at least 12.6 percent of health care coverage costs.

The average federal government employee makes almost twice the salary of an average private employee, counting fringes. That means we can replace federal employees at half price or double the number of contract jobs. Federal employees also have unique job protection rights. The Obama budget also has a 54% increase for pension costs. That is why we badly need severe budget cuts and a federal law like the Wisconsin anti-union law.

Please note that my parents, in-laws and wife were all government employees. My father was a long-time teacher's union representative, so I attended many union meetings. I even once did significant accounting work for his union. There also was a time when more than half of my CPA practice involved certified audits of government anti-poverty agencies.

We are now, however, ridiculously far from the reasonable wage and fringe benefits unions once protected.

President Obama's Speech, First Amendment, Broward School Board Lawsuit #2

This is an update on President Obama's Speech, relative to violations of the First Amendment and state law, in my Broward School Board Lawsuit. Judge Cohn issued this order in Case 09-61413-CV-COHN, on September 8, 2009, the same day I filed my federal class action suit:

This CAUSE is before the Court upon Plaintiff's Emergency Complaint Under the Civil Rights Act... Among other requests, Mr. Block seeks emergency relief, including having the Court issue "an Emergency Temporary Restraining Order, to stop Defendants from compelling Students to listen to this President Obama speech, or any such speech, except in accordance with legally adopted Board curriculum, which conforms to the requirements of state and federal laws, including the right not to listen under the First Amendment of the U.S. Constitution."

The Court did not receive a copy of the... complaint until late this afternoon, after the speech had already been broardcast. Thus, the request to stop Deferndents from compelling students to listen... is moot... The Court will  enter further orders upon service of the complaint upon Defendents as to the other requests for relief.

Outstanding! Attached is my Complaint and this impressive same-day decision. The dismissal of this one (of many) requests was inevitable, as I could not file sooner. However, I am now very glad about the delay. We simply need MORE evidence that the Board School Board Superintendent, Attorney, Commissioners or school employees knew or should have known that there were legal First Amendement and other objections to requiring student attendence. We already have a YouTube video proving this attached to my prior post on President Obama's Speech, the First Amendment, Broward School Board Lawsuit. I notified many all the Defendants and many Board employees of these objection long before President Obama's Speech and will certainly subpoena documents and defendents to get more evidence. Accordingly, the broadcast willfully or negligently ignored legal First Amendment, state law and Board rule objections. That should make the Court or Governor Crist remove many defendants and others I can add.

Please contact me if you can provide written or oral confirmation of anyone who knew of objections to this illegal compulsion.