SB 94 and AB 764

So our friends at the Capitol are at it again. Now, they clearly don't have enough to do. I mean, it looks like they are sitting around doing nothing and trying to save everyone. After all, we don't have a $24 Billion budget deficit. Yes, that is Billion with a B. How big of a deficit is this? This deficit is as big as the GDP of Trinidad and Tobago. Okay, if you don't get GDP, go ask your friendly neighborhood economist or that outstanding econ professor at CSU Sacramento, Prof. Lang.

What would you do if you had a $24,000,000,000 deficit? I would go about fixing it. But not these people. We are on the verge of paying vendors with IOUs and they are still doing other things. What great things are they doing? Trying to screw consumers AND put a whole bunch of good attorneys out of business.

Lets start with this concept: if you can't keep your own house in order, don't tell me how to run mine. Seriously, it is easy to sit around as a legislator and tell people who to run their businesses. But you can't even take care of your own business. I think the expression these days is "handle your business." I know, it is your business to protect people. That comes somewhere after PASSING A BALANCED BUDGET.

Now for those in the Assembly and Senate reading this, and I know you do because you freaking follow me on Twitter, let me give you a remedial math lesson. You cannot spend more than you take in. Simple. Income minus expenses cannot be a negative number. If it is, you are broke. If it continues, you file for bankruptcy. If it still continues, you end up being California.

You want to know why people spend more than they make? Because they look at their leaders who clearly think it is an acceptable thing to do. Oh, and don't sit there Mr. Conservative and blame the liberals, you won't freaking raise taxes. And don't blame the conservatives, Mr. Liberal who was giving away the farm doing the good times. Really, do you think that giving cost of living increases and step increases for pay can go on indefinitely?

Seriously, these folks are giving money away left and right. Now, I understand that some state workers are getting furloughed 3 days per week. That is a 15% pay cut. Where is your 15% pay cut, Dave "I want to be insurance commissioner" Jones. (For google purposes, DAVE JONES!") Darrell "I can't do math" Steinberg, I don't see you taking a 15% pay cut. But you want the working folks to take one. No, not want, force it on them. And Karen Bass, you aren't any better. Steinberg and Bass should resign now for their utter lack of leadership ability. You should have resigned before.

But, let me get back on track. While these yahoo's are screwing around over a state budget, a few of their colleagues decided they should try to regulate attorneys who help people get loan modifications. Their bills would ban an attorney from collecting any money up front. Yes, that's right. We would have to get paid AFTER we get the client a result. Fine. But, what client's do they think are going to pay AFTER getting what they want? Let's be honest. The mechanic doesn't give you the car back before you pay to make sure you are happy with the work. The home builder doesn't fix every problem before having the money. The legislator doesn't balance the budget before getting paid. No, these folks all get paid up front.

But let's play along. Now as an attorney I cannot get paid for the work I do up front. I can't even put the money in my trust account. I have to trust my client to pay me on the back end. Would some of my clients do this? Yep. Would most of my clients do this? Probably. Would all of my clients do this? Nope.

Imagine if you go to work every day and your boss decides to pay you 75% of the time. Would you go back to work? No. Of course not. Who would do work when there is no guarantee of payment? Very few people.

So, what happens in this scenario? The attorneys who are doing the work stop doing it. What's the problem with that? Well, according to the folks at the Capitol and the consumer groups, nothing. After all, the banks are doing a fine job giving people loan modifications. And the attorneys are all ripping people off. We have to stop the attorneys.

A little perspective: the State Bar has about 850 to 900 complaints about attorneys handling loan modifications. They have 100 attorneys under investigation. There are 200,000 or so attorneys in the State. Um, I am not that good at math, but that is, .05%. You are passing a law to stop less than 1% of the attorneys in the state who are scumbags.

Now, the banks? Nope, they can pay their attorneys anything they want. And the bank lawyers? They can charge anything they want and get paid up front. You see, we have to stop the attorneys who are representing consumers. We have to stop the small guys. Are there bad attorneys? Yep. I heard of a guy who has made millions since the beginning of this year alone and done no work.

Seriously, the legislators and the consumer groups think that the banks are doing a fine job as are the non profits. Have you talked to someone who has called a non profit? Ask them how much help they are getting. NONE! Are the banks offering loan modifications? Sometimes. Of course, Wells Fargo turned down a client because it wasn't in WELLS FARGO's best interest. Countrywide declined a short sale because they were missing 1 page for 1 offer and there were 6 other offers. Did they notify anyone that the page was missing? Nope. Just denied it.

Heck, GMAC has all but admitted that they will take attorney cases and move them to the front of the line. Yes, those folks go first. But now there won't be any of those folks. So, what is going to happen? Anyone? Bueller? After all, if the banks did the right thing in the first place, we wouldn't be in this mess, would we?

Sure, consumers are to blame. They wanted to keep up with the Jones'. That isn't good. But mortgage brokers were putting people in mortgages that they knew couldn't be afforded. And real estate agents were selling people homes that they knew were outside of their price range. And banks were writing garbage no doc loans and accepting that people who were high school dropouts were making $150,000 per year as a street sweeper. But we are now supposed to believe that these same banks are trustworthy and are going to do the right thing?

I guess our legislators are either dumb, paid off or blind. I don't care which but if any of them has the cajones to debate me on the issue, I am game. You morons can't balance a budget but you want to tell me how to run my business? Really? Should I run my business the way you run the state? Should I run a deficit? Are you going to bail me out since you are now telling me who I can and cannot charge?

But it gets worse for me. The State Bar agreed with this idea. They had a board of governors meeting. The President, of course, was on vacation and couldn't fly back for the meeting. She couldn't even attend by phone? Webex? Video conference? Freaking pick up the phone and call and be put on speaker phone? Apparently that is too complex for her. So, President-elect Howard Miller ran this meeting and pushed this idea through. Miller claims to be a plaintiff's lawyer or a consumer attorney. I guess if you consider a millionaire a consumer attorney then he may be. But he just said to every other consumer attorney "I think you guys should sit and spin."

He just agreed to let the legislature tell us how to run our business and how to charge our clients. What's next? Maybe a personal injury attorney can only charge 10%? Maybe a criminal defense attorney can only charge his client if the client avoids jail? Maybe the medical malpractice attorney shouldn't be able to charge a fee since someone in the legislature must think doctors do good things. Maybe if Miller is so happy with the way the legislature wants to regulate business, he will let them come in and tell him what he can charge and how much. No? He doesn't want that? Then here is an idea: don't support them telling me how to run my business, numskull.

We have the perfect storm. The State Bar has now decided that the legislature should tell attorneys how to charge. The legislature gets to deflect attention away from their complete and utter failure and lack of ability to do their jobs and claim they are out protecting people. And the banks get to continue making their millions of dollars by screwing consumers. And somehow the consumer groups think this is good. Do we really wonder why our state is falling apart when we have a system where I was told by a legislative staffer "that may be the truth but that won't sell in the Capitol?" When these bills pass, the government of California will have failed to protect consumers once more while continuing to cover up their incompetence.

By the way, to those of you reading this at the Capitol, the offer still stands: a public debate of these bills. Yes, that goes for you Nava, Calderon, and Corbett, as well as you Jones, Steinberg and Bass. Oh, and you alleged consumer groups, that goes for you as well. Anytime, anyplace, anywhere.

California's Budget

Okay, so here we are on February 16, 2009. This is a day we celebrate great Presidents in our past. George Washington - the man who cut down the cherry tree and our first President. Abraham Lincoln - the man who freed the slaves and was a great orator.

Yet, those of us who live in California do not see greatness when we look at our state Capitol. We see a mess. A lack of leadership. People who can't seem to find their way out of a paperbag. How bad is it? These people think they should tax their way out of a recession!

Okay, I know I stopped studying economics in undergrad. But, last time I checked, when you tax people, they spend less. So, what do our leaders do? A 1% sales tax increase. Okay, not bad. Then a 12 cent per gallon increase on the gas tax. So, each gallon of gas, which is already crazy expensive, will now go up by another 12 cents. For a 10 gallon car, that is a $1.20 increase. If you fill that up 2 times per week, we have over $100 per year less money to spend.

This is a tax that impacts lower income people disproportionately. While many upper class people can afford an extra $100 per year, if you make 50% less, that impacts you greater. So, a $100 tax on someone make $100,000 per year is very small. The same $100 tax on someone who makes $25,000 is quite large.

Yet, our government thinks this is the way out of the budget. Lets make people give us more money so we have money to spend. Not sure if they are aware of this, but if I give them more money, I have less money to give to businesses. Less money to buy things means the recession drags on.

Then, these geniuses decide that they should link this tax to a special election. Yes, we are going to have a special election in May in California. Special elections cost money. Oh that's right - we don't have any. Why don't we have any? Because the legislators spent it all!

Now, I understand we need to raise revenue. I am not anti-tax. I am just anti-unreasonable tax. Almost doubling the gas tax is unreasonable.

I think we should tax legislators. Yes, we should take their income and double the tax they pay. And we should double the tax of every past legislator for the last 10 years. Sure, it may be unconstitutional, but then maybe these morons will understand that not doing their job properly was unconstitutional as well.

Okay, here is a better idea: all of that money that these folks keep in accounts to run for new office should go to the deficit. They raise millions and millions of dollars to run for a new office when they haven't even done their jobs. Lets take that money!

Look you folks who are sitting in the Capitol and sleeping there: you should have done this months ago, if not years ago. Don't cry to me, Karen Bass, because you can't get a deal done now. You waited too long. You have no power. You should resign, and not just as speaker, but from the Assembly. You too, Darrel Steinberg. Your time has past. You failed to do your job - protect the residents of the state of California. Instead, you padded your own pocketbook.

Every member of the California legislature should resign now so you don't go down in history as the most incompetent group of people to even run a state. Assuming its not too late for that!

The California Legislature Needs to Miss Christmas

For those of you keeping score at home, California is facing a $14 billion plus deficit. This comes after our state government couldn't pass a budget until it was over 60 days late. Of course, the fine folks in the legislature get paid for not doing their job. Sure, they had to wait to get paid, but they still get paid. In the meantime, regular Californians who are not hand picked to be in the legislature are getting screwed.

So now they are meeting to discuss a revised budget. The state has been warned by the Finance Director that failure to get a new budget in place will harm our schools and social programs. The headline in the Sacramento Bee: "Discussions hit deadlock." Apparently, these folks cannot put partisan politics aside long enough to get a budget passed.

With that background, I have two ideas:

1. Lock them in chambers on December 23. Keep the doors closed with the CHP outside. They stay until there is a budget deal. No budget means no Christmas for them. Since many regular Califorians will not be having Christmas this year because our state is falling apart, our "leaders" should not have Christmas either. I believe its called tough love.

2. Lock them in chambers today. Turn off the heat. Let the Governor come in and light up one of his famous cigars. He can chain smoke for all I care. The smoke will build up until they agree on a budget. That should get the trick done. Oh, its bad for their health? You know what else is bad for one's health? Not having health insurance, but they can't seem to get that done either.

To our legislators: it is not that hard. You need to make cuts. It is not going to be fun or easy, but it needs to be done. And done now. So sit down, put your BS politics aside and get the deal done. Either that or quit because you clearly cannot make the tough decisions.