Wednesday, September 30, 2009

Riots in Pittsburgh

Here is sgtrob88 commenting on a youtube video of police tear-gassing students at the University of Pittsburgh:

I would imagine 75% or more of these kids are liberal, yet going through this will probably not dissuade any of them of the notion that over-sized government is BAD. Like their hippy parents they will continue to allow government to increase in size and power all in the name of "caring for the little guy," while ignoring their own experiences in governmental abuse. While corporations are no saints, government is the one able to beat your *ss and get away with it.

Makes sense to me, except we need to differentiate between government actions that have the power to harm citizens (police, unnecessary laws, etc.) and government actions that can protect the public (public defenders, VA hospitals, etc.). Of course, since few people will agree on which government actions will either harm or protect the public, it seems appropriate to have a bias against broad laws or power of any kind.

Reason #15,473 Not to Go into Law: You Might Become a Real Prostitute

Reason number 15,473 not to go to law school: if you don't pass the bar, you might end up becoming a high-priced escort. See here for the story of a Stanford Law graduate who ran a high-priced call girl service.

If the link doesn't work, try googling "Cristina Warthen," "Brazil," and "Stanford Law." From the SJ Merc article:

Warthen gained notoriety when she was busted as a jet-setting call girl who sold her services to pay off her Stanford Law School debts. She got her law degree from Stanford in May 2001.

I wonder if she ever met Eliot Spitzer...

Monday, September 28, 2009

Guess Who?

Guess who made the following comment:

You’ve got to cut spending, you’ve got to balance the budget, you’ve got to stop fighting these wars, you’ve got to bring our troops home, you’ve got to quit expanding the welfare state here at home...

Hint: it's one of the few honest members of Congress.

Sunday, September 27, 2009

Unusual Tax Deduction

No joke--a lawyer tries to deduct expenses relating to prostitutes and pornography:

http://taxprof.typepad.com/taxprof_blog/2009/09/tax-court-denies-.html

The Tax Court shoots down his argument, of course.

Saturday, September 26, 2009

Educational Discrimination: Race Baiting?

I just had a major argument with someone about educational benefits. It got so bad, her boyfriend was ready to fight me inside a Marie Callender's.

Apparently, this woman's friend had complained that a school district denied her white child benefits because of his race. This woman then said her friend raised this issue at a public school meeting and was "brave" for doing so. This woman specifically said that "only minorities could apply for these benefits," which riled me up. (Later, in an online discussion, she wrote, "my friend's child was not allowed to obtain government assistance because an administrator determined that the program was for minority groups only.")

I said several times that the government could not deny public educational benefits to anyone based on race. She reiterated that only minorities could apply for these benefits. After several minutes of heated back-and-forth discussions, I heard her say the law and reality were two different things. In other words, the law itself might not discriminate against white kids, but in reality, the school district wasn't allowing white kids to apply for certain benefits. (I guess what she meant to say earlier was, "In practice, school districts allow only minority children to apply for certain benefits.") I asked for the name of this anti-white program. She couldn't tell me the name of the program.

Then, some other people at the table jumped in. One person said teachers were giving undeserving minorities passing grades so their schools could get funding. I said it sounded like teachers were passing stupid people (of all races) to get funding. He agreed. I said if stupid people are being passed, we're not necessarily talking about minorities--we're talking about stupid people. He clarified that a certain percentage of minority students had to be passed each year to get funding. Once again, no one was able to cite a specific law or program.

Afterwards, I thought about "No Child Left Behind." The law apparently rewards school districts for retaining children from disadvantaged groups, including disabled kids and economically disadvantaged kids. I suppose a teacher who wanted to game the system would pass an ever-increasing percentage of black kids each year. My friend's husband probably meant to say that teachers are unfairly promoting stupid kids who happen to be black, not black kids because they are black. Maybe it's a subtle difference, but it's an important difference. I didn't see any federal funding tied to ensuring a certain number of minority kids pass a particular grade. (If I am wrong, I hope someone will leave a comment citing a U.S.C. or C.F.R. section.)

Someone else then mentioned a school program that allows black kids from a poor section of town to attend an affluent Atherton, California school. The problem? These black students live outside Atheron's mainly white and rich county, so their parents don't pay the same amount of local property taxes as the white Atherton parents. In essence, it seems these black kids are getting a free ride, i.e., a special benefit because they are black--or at least that was the insinuation.

After a few questions, I found out these black kids live in a county (maybe an unincorporated area?) without a school. Because they don't have a school in their county, the nearby Atherton school allowed them to attend. I pointed out that these kids weren't getting a free ride because of their race--they had to go to school, and their county didn't have a school. It sounded like someone saw a bus dropping off a bunch of non-white kids at the mainly white Atherton school district and assumed there was a pro-minority government program. In the alternative, perhaps there was a busing program to help desegregate various schools. In these programs, both white kids and minority children may attend schools in other districts. [See below for more information on this Atherton busing program. The Tinsley Act/Program, aka VTP, does create more opportunities for minorities; in fact, the district's own webpage specifies that "Students of Color living in the Ravenswood City School District entering kindergarten, first, or second grade" are eligible. Minority students, aka "students of color," are assigned limited placements through a lottery system; however, white children from the better-performing Atherton schools may apply to attend the poorer-performing Ravenwood School District.]

If anyone knows of any government program that denies benefits to anyone because of race, s/he should contact this legal foundation (Pacific Legal Foundation). In America, the government cannot legally prevent anyone from receiving educational benefits because of their race. See here for a relevant U.S. Supreme Court decision, and my analysis of the decision here.

In six years of legal practice, I have seen legitimate complaints about anti-white government programs only in two instances: allegedly improper promotions or unqualified hires in government jobs, especially in police departments. If, however, you believe the government is denying educational benefits to white children because of their race, you should know that such programs may be illegal. Again, see here.

I find this notion of anti-white government programs ludicrous. I mean, an entire swath of teachers, parents, lawyers, boards, PTAs, and administrators would have to knowingly violate the law (or stay silent) for schools to deny "special" benefits to white children because they are white. We're talking about tens of thousands of people involved in a de facto conspiracy to violate the law and prevent white children from applying for public benefits.

Now, there may be special programs to assimilate Spanish-speaking children in schools, but such programs are not based on race. For example, an Argentinian immigrant of German ancestry could benefit from such a language-assimilation program. In addition, I favor opening the desegregation program to all poor children, including white children, from East Palo Alto.

Once again, to the extent there are programs that assign special benefits to children because of their non-white race, you should contact the Pacific Legal Foundation or the Cato Institute. You may also contact me. I am very interested in learning whether widespread anti-white discrimination exists in the administration of educational benefits in California.

Anyway, whew! Not what I expected on a Friday night. In the future, I hope all children and adults study Occam's razor--the idea that in most cases, the simplest explanation is the right one.

Update: I researched the law extensively to see whether I could find something on point. Here is what I found: see 20 USC 1703: "No State shall deny equal educational opportunity to an individual on account of his or her race, color, sex, or national origin..." After Brown v. Board of Education, this country has taken numerous steps to ensure that all children have equal access to educational benefits.

I thought about the idea that some teachers were passing kids who didn't deserve to pass. I looked up the No Child Left Behind law again. It doesn't force teachers to pass kids of any race; however, it does establish vague goals, like "closing the achievement gap between high- and low- performing children, especially the achievement gaps between minority and nonminority students, and between disadvantaged children and their more advantaged peers." It appears to authorize programs for lessening the achievement gap, but it is unclear who is funding these programs.

In one section, however, NCLB establishes a specific grant for "students with disabilities, ethnic minority students, and students with migrant parents" for the sole purpose of visiting Washington, D.C. (It looks like more of a pro-tourist grant than a race-based grant.)

There are other sections of NCLB that focus on children with disabilities and "ethnic minority groups," but every single provision provides a reward for adult teachers and government workers of *any* race if they improve "retention" of low performing kids, including minority kids. I did not see any benefits that were restricted to minorities only. All educational programs must be open to all students, but schools appear to be rewarded for boosting the academic performance of ethnic minorities. In any case, it is unclear to me how a white student is negatively affected if a minority student unfairly passes a grade. If anything, the undeserved promotion probably hurts the minority student.

Outside the educational sphere, I did see some government programs that favored minorities over non-minorities. For example, certain government contracts are open only to minorities--see 10 U.S.C. § 2323. However, within the educational sphere, it appears that teachers and administrators of *all races* may get more school funding if they promote academic achievement for economically disadvantaged children, including minorities and disabled children.

This country has racial issues and a major economic divide, but playing up "white victimization" isn't the way to solve anything. Just my humble opinion.

Update: I started looking at California state laws, too. One Education Code section is interesting:

54402. For purposes of this chapter, a "disadvantaged minor" is a minor who is potentially academically able but scholastically underachieving, and must compensate for inability to profit from the normal educational program. He is a minor who...(c) Is, because of home and community environment, subject to such language, cultural, economic, and like disadvantages as will make improbable his completion of the regular program leading to graduation without special efforts on the part of school authorities...

Sections 54403 and 54405 allow the State Board of Equalization to establish K-12 programs to assist "disadvantaged" minors. The word "race" isn't used anywhere, so the law does not prevent linguistically slow or culturally disadvantaged white kids from participating in the programs; however, it is clear that many minorities will participate in these programs. The reason many minorities will participate in these programs is because their parents, unlike domestic-born kids of any race, probably have no idea how to help their kids with homework. If your parents don't speak English and haven't been to school here, then obviously, they will have difficulty helping their kids understand their homework.

I realize single or poor white mothers may also lack the time to help their children with their homework. Under the law, no school may deny disadvantaged or low performing white children entry into these remedial/extra programs.

By the way, other sections authorize programs to assist "migrant" workers, but these are remedial programs and are not based on race. For example, Swedish kids who came to California in September and knew they wouldn't stay a long time would be able to participate in these programs. Fishing migrants and many other categories of migrant workers are included, not just agricultural migrants.

Update: I just thought of something that might clarify the discussion. Some people might argue ESL and other language-assimilation programs are anti-white b/c they sap resources from schools that would otherwise go to native-born kids, many of whom happen to be white. I can see why some people think this way; after all, 99% of the kids in ESL programs are probably non-white. Perhaps if you walk into a class with 99% minorities, it's easier to believe that your white child, who isn't getting special language classes, is somehow harmed (even if your white child is taking advanced English).

In reality, language-assimilation programs are not race-based; for example, German immigrants who don't speak fluent English would be allowed to enter ESL programs. It just so happens that a lot of our recent immigration has been from so-called non-white countries. In the future, if most of our immigration comes from Sweden, and we spend lots of money on ESL programs, I have a hard time believing that anyone would say such "special" programs are anti-white or deny benefits to white children.

I already mentioned language-assimilation programs earlier, but I'm not sure if I was clear. I really don't see any evidence that schools discriminate against white kids because they are white. I rest my case on the inability of anyone to specify a single specific program where schools deny benefits to white kids (who, by the way, don't need remedial English courses). I do understand that someone may argue that desegregation or busing programs discriminate against white children to the extent white children cannot apply for these programs.

I'd appreciate seeing some specific evidence of harm to white children as a result of desegregation programs. Without specific evidence, it is hard to have a productive discussion. For example, at the dinner, I felt like Richard Dawkins, trying to refute creationists--no matter how many times I demanded proof, someone expected me to accept allegations of anti-white K-12 discrimination on faith. Sigh.

Update: here is a friend/teacher, who sheds some more light about the Atherton issue:

I am glad that someone is taking the time to dispel the many misconceptions people have about society and education. You are correct about NCLB. It is essentially an unfunded federal mandate that actually has nothing to do with grades. It has to do with scores on standardized tests but has no bearing on passing or failing classes or moving on to the next grade.

Also,
there is a desegregation program that allows East Palo Alto minorities to attend Palo Alto, Atherton, Mountain View schools (some others too). Our district (Palo Alto Unified) does bus in minority kids from East Palo Alto every day in what we call the Voluntary Transfer Program which is only available to minority students even though they have a district of their own (Ravenswood). It was a court mandated ruling from the 70's called the Tinsley Act. You should look into it. It was designed to provide equal opportunity to minority kids from East Palo Alto in the form of better teachers, books, etc. I do think that white children can apply even though there aren't many in East Palo Alto.

Fascinating. See here, here, and here for more on the Tinsley Act. The district's own page states, "Students of Color living in the Ravenswood City School District entering kindergarten, first, or second grade" are eligible for the program. At the same time, California's Constitution allows voluntary desegregation programs. See Article I, Section 7:
Nothing herein shall prohibit the governing board of a school district from
voluntarily continuing or commencing a school integration plan after the effective
date of this subdivision as amended.
There is also controversy about whether the Atherton school is subsidizing the students from the other side of town. For example, one person commented, "The [Palo Alto/Atherton] district gets $3,500 per student in return. But Palo Alto spends approximately $10,300 per student, so it is 'subsidizing' these students by about $6,800 apiece for a total of $3.7 million a year." If anyone has more information about the Tinsley Program, please leave a comment.

Bonus: according to John Barton, while "California is ranked near the bottom in student test scores, the state is 25th in per-pupil spending for the current K-12 operations, according to the National Center for Education Statistics, part of the U.S. Department of Education. It is No. 1 in teacher salaries nationwide -- the U.S. average is $45,810 while the California average is $56,283 (2002-03)."

Friday, September 25, 2009

Symantec's Annual Shareholder Meeting (2009)

I attended Symantec’s annual shareholder meeting on September 23, 2009. The company offered shareholders a goodies bag that included a complimentary copy of Norton Online Backup; a zip-up notebook; a nice pen; and a small padlock (symbolizing Symantec’s security focus). Approximately thirty attendees were treated to coffee, juice, and pastries.

I was looking forward to this meeting for two reasons: one, the Investor Suffrage Movement asked me to move Proposal No. 3 on behalf of another shareholder; and two, this would be new CEO Enrique Salem’s first year handling the annual meeting.

Chairman and former CEO John Thompson opened the meeting and introduced various Board and executive team members. After Mr. Thompson was done, Executive VP and General Counsel Scott Taylor allowed me to move Proposal No. 3 (sponsoring shareholder: Kenneth Steiner) and to provide a short explanation of the proposal. I’ve been to many shareholder meetings, but this was my first time moving a proposal. I delivered a short summary about the proposal and then sat down.

One quick aside: I attended Symantec’s meeting last year and was very impressed with then-CEO John Thompson. I was looking forward to seeing him again this year, but had forgotten that corporations tend to despise outside shareholder proposals. Responding to such proposals takes up attorney time and internal resources. The usual corporate attitude is that if shareholders don’t like the way the executives run the company, they can sell their shares. So perhaps I should not have been surprised that while I was reading the presentation, Chairman John Thompson, seated only several feet from me, was staring at me with a “Make My Day” expression. (To his credit, Mr. Salem recognized me from last year and skipped the stare-down.) Thankfully, after the meeting, Mr. Thompson was his usual charismatic self, entertaining various attendees with some stories. Mr. Thompson appears to be in great shape and has lost some weight since last year.

After I moved the proposal and delivered the short summary, Mr. Taylor closed the polls and announced preliminary results. Proposal No. 3 passed. After Symantec takes additional steps--such as amending its bylaws--the threshold for calling special meetings will be 10% ownership, down from 25% ownership.

Mr. Taylor then introduced President and CEO Salem, who delivered a brief presentation about Symantec’s accomplishments. I’ve listed what I consider to be the most interesting information below:

1. 120 million consumers use Symantec’s software.

2. Symantec’s customer base is 30% consumer, 70% enterprise.

3. Symantec wants to “commoditize infrastructure,” which means driving costs out of the environment (I asked Mr. Salem to clarify this term after the meeting. He gave me an example of a consumer choosing between two hard drives--Symantec wants to give the consumer the same capabilities in each product so the consumer can choose based on price. For more information, see page 3 of the Annual Report, under “Enable our customers to simplify their heterogeneous environments and reduce costs...”)

4. Symantec is growing its data loss prevention and “online backup” business. Symantec anticipates a lot of growth from its “online backup” business.

5. Symantec’s growth comes from both “organic innovation and acquisitions.” For example, Symantec is testing “reputation-based” analytics (i.e., should this software run on my computer?) and has an impressive R&D budget. (Note: Symantec's reputation-based analytics feature is live in Norton's 2010 products.)

After the informal presentation, Mr. Salem opened the meeting to questions. A shareholder made several comments about Proposal No. 3, which he opposed. He said that labor unions hated Mr. Robert Miller (who was singled out several times in the proposal) because he was a tough CEO. He said American corporations are being “denigrated” by activists.

Mr. Salem, like most corporate executives, is no fan of outside shareholder proposals. He could have taken the bait and criticized the proposal; instead, he showed admirable diplomatic skills. He indicated he would work with Symantec’s largest shareholders, and he was committed to shareholder success. I immediately realized Symantec had chosen a CEO with excellent PR skills, which is important for any service-oriented company.

Another shareholder, Tony Mazzapelle, questioned a large goodwill writedown. Mr. Salem acknowledged the unusually large writedown of approximately $7.4 billion and explained that at one point, the dislocation of the stock market had caused Symantec’s goodwill to be valued more than the corporation itself. The company recognized the issue and complied with SEC rules to resolve the matter. He also clarified that the large goodwill was the result of several acquisitions, not just one.

Mr. Mazzapelle then raised an issue dear to my heart, which is non-GAAP vs. GAAP accounting. Personally, I hate non-GAAP results. Even though it’s legal and common to use them, non-GAAP numbers allow accountants too much leeway. Here, for example, using non-GAAP numbers allowed Symantec to report operating income of approximately $1.88 billion for Fiscal Year 2009. During the same time period, however, using GAAP, Symantec reported an operating loss of approximately $6.5 billion. Slight difference, no?

Mr. Mazzapelle rightfully complained that publishing both sets of numbers was confusing, and he asked whether the company would continue to publish both sets of numbers. Mr. Salem responded that Symantec would be using both GAAP and non-GAAP methodologies in the future. He said if shareholders wanted a clear vision of the company’s finances, they need only to review Symantec’s cash flow, which is approximately $1.5 billion annually. His response left even a skeptic like me satisfied.

Another shareholder questioned Symantec’s marketing costs. Mr. Salem indicated the company was aware of the issue and was focused on growth (which naturally entails significant marketing costs).

Was Symantec gaining or losing market share against McAfee (MFE)? Mr. Salem said Symantec was gaining in the large enterprise segment, but not in the small business segment. He also said, the “quality of our products has never been better.”

I asked my usual question: what is Symantec’s competitive advantage in the marketplace? Mr. Salem said that Symantec’s software could run on almost any platform (Linux, etc.) and protected consumers “against the widest range of threats.”

Overall, I was very pleased with Mr. Salem’s demeanor, knowledge, and delivery. Prior to the meeting, I was concerned that after having a CEO as charismatic as Mr. Thompson, Symantec’s next CEO would have difficulty measuring up. My concerns were clearly misplaced.

As I mentioned earlier, this is my second year attending a Symantec annual meeting. Once again, Symantec ran its annual meeting professionally. It deserves kudos for delivering a pleasing shareholder experience. Its ability to run a great meeting is especially notable because its local competitor, McAfee, doesn’t seem to emphasize its annual meetings. For example, in recent years, McAfee (MFE) hasn’t bothered with an informal slide presentation. To make matters worse, when I last attended McAfee’s annual meeting, shareholder relations staff treated me like an intruder (I appeared to be the only non-employee shareholder there, which might have bothered them). Although McAfee's stock has done better than Symantec's recently, once Symantec digests its massive (and perhaps ill-timed) acquisitions, it may outperform McAfee. In the meantime, long-term, patient shareholders may want to consider buying Symantec stock.

Disclosure: I own an insignificant number of SYMC shares. If I do add shares, I expect to hold them for several years. Also, I provided a copy of this article to Symantec prior to publication. Consequently, I incorporated some minor changes in my sole discretion. Almost all the changes related to correcting numerical values, such as changing $7.7 billion to $7.4 billion (I originally wrote $7.7 billion because that's the number I heard the shareholder say).

Why Newspapers Are Dead

Barry Ritholtz beautifully sums up the declining newspaper business:

I would argue that mainstream newspapers haven’t just lost readers because of the Internet as an abstract new medium, but that they lost readers because they became – with some exceptions – nothing but official stenographers for the powers-that-be. No wonder people have lost all faith in them.

Years from now, anyone who wants to know why newspapers died need only review the paragraph above. Also, I'm not sure why Barry used the plural form of "exceptions"--he probably meant the New York Times.

Thursday, September 24, 2009

John Mauldin Interview

Just a short post today.

Here is a great interview with John Mauldin. The interviewer is Wall St Cheat Sheet's Damien Hoffman. More from Mauldin here.

Tuesday, September 22, 2009

Magma Design's Shareholder Meeting (2009)

I attended Magma Design Automation Inc.’s (LAVA) shareholder meeting on September 17, 2009. The company offered attending shareholders coffee, water, untoasted bagels with cream cheese, and assorted pastries. There was no prepared informal presentation.

CEO and Chairman Rajeev Madhavan handled most of the meeting. CFO Peter Teshima also answered several questions. Both CEO Madhavan and CFO Teshima responded to my questions with energy and confidence. I asked several tough questions, and I received good answers. Some quick points:

1. Some of the information provided in the 10K is now outdated. Although Magma’s 10K states, “There is substantial doubt about our ability to continue as a going concern,” (page 11) Magma recently secured financing and will be able to satisfy its May 2010 bond obligations. According to statements made at the meeting, management waived the original 70% voting requirement (page 59). About 54% of the 2010 bondholders participated in the 2010 note exchange offer. This new development allows Magma to avoid distributing all of its cash to the May 2010 creditors.

2. Magma derives a significant percentage of its revenue from outside North America. See 10K, page 24: “we generated 41% of our total revenue from sales outside North America.” Consequently, Magma’s future revenues may not entirely depend on the American consumer.

3. Magma may have patent infringement issues. See 10K, page 27: We believe the patent portfolios of our competitors are far larger than ours, and this may increase the risk that they may sue us for patent infringement...” (To be fair, many tech companies face the possibility of patent infringement litigation.)

4. Other bloggers have said they expect Cadence (CDNS) to buy out or merge with Magma; however, CEO Madhavan seemed mildly upset that his company wasn’t getting the same respect as Cadence and was somewhat dismissive of Cadence’s financial position. In contrast, he had high praise for Synopsys, Inc. (SNPS).

According to a Magma company employee, CEO Madhavan seems to admire Synopsys’ financial profile due to its 90/10 revenue model, where 90 percent of revenue during a given quarter stems from backlog and only 10 percent from same-period deals. On the other hand, according to the same internal Magma source, Cadence and Mentor Graphics (MENT) have not yet achieved this preferred 90/10 revenue model (Magma points out that it achieved this 90/10 ratio two quarters ago). To be clear, CEO Madhavan did not express an opinion of a possible or a preferred merger or acquisition scenario.

I asked CEO Madhavan my usual question: “What is your competitive advantage in the marketplace?” CEO Madhavan answered that Magma software offered a “value proposition.” Using Magma’s software, semiconductor companies could save one million dollars in the process of designing a single chip. My understanding is that Magma’s software streamlines various aspects of chip design, which allows semiconductor companies, especially analog chip companies like Maxim (MXIM) and Linear Tech (LLTC), to use fewer engineers. Obviously, fewer engineers means less overhead for a semiconductor company, and less overhead means more financial flexibility. That’s the short version of Magma’s purported advantage. The following is the long version, based on my conversation with an outside engineer:

Designing chips is expensive because designs usually go through several modifications before they actually work. Engineers first design a circuit on a computer (called schematics). Then, they run modeling/simulations to make sure the circuit runs properly on the computer. After computer testing, the engineers transfer their design from the software/abstract to a physical layout for fabrication. The final step is sending the layout to the fab to make the actual chip. However, even after the manufacturer/fab creates the chip, work is not done. Engineers still have to test the chip in their lab in real-life scenarios. Sometimes the chip doesn’t work to the proper performance specs. This gap in expected performance requires the engineers to go back and re-work the design. The company must go through all the design stages again prior to sending a new, improved design to the fab. Unfortunately, every iteration (i.e., modifying the schematics) costs the company money. Depending on the skill level of their engineers, a company may have to fund several more iterations. Magma is saying that its software reduces the number of iterations and therefore saves chip design companies money and resources.

I questioned the CFO’s reliance on non-GAAP accounting numbers, citing pro forma accounting gimmicks used by Enron. CFO Teshima countered by saying that only “one or two acquisitions were the primary difference between GAAP and non-GAAP numbers.” CEO Madhavan left the meeting saying that Magma was the “new kid on the block,” implying that it wasn’t getting the respect it deserved.

I enjoyed the energy Magma’s executive team brought to the table. The CEO seemed unafraid of his competitors and prepared to compete. Magma’s current share price, which is under two dollars, reflects the company’s recent financial problems. Magma indicates that such financial problems are behind it, and it is confident about the future. In my opinion, Magma has several high risk factors, but also the potential for major upside. Personally, I am going to wait until Magma’s balance sheet improves before making any major purchases, but I will be following the company more closely.

Disclosures: I own an insignificant number of LAVA shares. A Magma employee also had an opportunity to review this post prior to publication and submitted some comments to me. I incorporated a few of his comments, mainly relating to the 90/10 revenue model and paragraph 1, which starts, "Some of the information provided..."

Liberal Judges vs. Conservative Judges

I was thinking this morning about courts and politics. I've discovered I tend to get along very well with former military servicemembers and police officers. One of my best friends is a JAG (from ultra-conservative Orange County, no less). Another lawyer I respect is also a JAG. While I don't know many police officers, I've found most of them to be hard workers.

As an anti-war libertarian, I find it strange that I can easily socialize with people on opposite ends of the philosophical spectrum. (At least now I understand Ron Paul's comment that individual military servicemembers, as a group, contributed more to his presidential campaign than to any other candidate's.) I did some thinking, and I realized I get along with liberals because I favor change and diversity, and I get along with conservatives because I see the limits of the law in creating any real change. In other words, I am hopeful enough to get along with the liberals, but cynical enough to see the inefficacy of most liberal programs.

As attorneys, there comes a period of time when we get enough experience to see the system as it is, not as we want it to be. Think of the famous Gandhi quote--"Be the change you want to see in the world"--but minus the idealism. After we clean the pixie dust from our eyes, young lawyers look at our student loans and get back to work. (The potential for starvation helps clear the mind rather quickly.) We realize, sadly, that the law doesn't matter so much as the audience, and the only audience that much of the time is the judge, who gets selected randomly. Is it strange to think that the law relies so much on randomness? I assure you, at some point, you get over it, or you go insane. As fans of Trainspotting will appreciate, I choose sanity.

I have also noticed that conservatives tend to work harder. For example, I've noticed that judges who were former military servicemembers work the hardest. Even politicians who used to be military, like Chuck Reed, are known for working hard. Servicemen don't seem to lose their work ethic, and they bring it with them to every job, whether it's politics or the bench. Thus, while many government jobs are filled with "lifers" resistant to change and who do the absolute minimum required, the military is probably the one branch of government that demands you work hard, no exceptions allowed. As a result, when servicemembers finish their military commitment, they bring the same "hardcore" attitude to their civilian careers. In my experience, judges who are ex-military usually read the court filings and are well-prepared for court hearings, even if they don't reach a fair result or go overboard. Many other judges are quite content to show up and let their law clerks do most or all of the work, but that lax attitude doesn't seem to afflict most ex-military members.

Police officers tend to function like military servicemembers. They're also hardcore, and they respect hard work. (By the way, the police officers I've met usually hate Democrats, because they think Democrats are naive in thinking their policies or laws would have any effect on a child molester or a drug dealer trying to make a buck.)

So why do I tend to get along with cops and military servicemembers, even though I am anti-war and I favor more police oversight? I guess it's because I'm hardcore, too. I'm fond of saying, "I do what I say, I say what I mean." As I get older (cue Winston Churchill and his comment about young hearts and old brains), I've noticed that many self-proclaimed liberals tend to be big thinkers and big talkers but lack the capacity for actual sacrifice. For example, I recently saw a liberal activist with a T-shirt that said, "Anti-War." Well, that's great, but how does buying yourself a T-shirt help some little kid in Iraq? Personally, I would take that T-shirt money and donate it to kiva.org, the Red Cross, or some other organization. That's the problem I've seen with many liberals--they have strong views, but they refuse to sacrifice anything themselves. It's usually someone else who has to do the sacrificing--either the rich, the small business owner, etc.

As for liberal judges, I've found many of them tend to have a poor work ethic. While the conservative judges are at home reading the papers for court the next day, the liberal judges tend to be teaching law classes, giving seminars, publishing some legal treatise--i.e., something that allows them to impart their knowledge to the public.

Don't get me wrong--I love legal seminars, especially the ones that include judges. But other than one judge, who's in federal court, I don't tend to see liberal-minded judges prepared with insightful questions to ask. One time, I provided a liberal-minded judge with extensive legislative history relating to a law. I marked in bold and 14 point font all the relevant sections of the history that showed the judge that his law clerk's statutory interpretation was wrong. The judge practically freaked out (I could almost hear him thinking, "You don't expect me to read all this, do you?"), and--in my subjective opinion--may or may not have ignored the legislature's intent.

Maybe I'm a terrible oral advocate, but I've left court several times feeling like my hard work and research were a waste of my time and my client's time. Too often, there are no tentative rulings to focus the oral argument, or the judge does not ask me a single question. As a result, I've become critical of judges who rely solely on their law clerks, even when their clerks do excellent work. As far as I'm concerned, judges who don't personally read the legal briefs are stealing from taxpayers. It seems no different than a lawyer who bills for time never worked. A lawyer who tried to bill for unworked hours would be fired, so why should a judge be treated any differently? After all, judges are paid for their time and expertise, just like lawyers. Shouldn't they read the legal briefs, even if they have research attorneys?

Before addressing some differences between conservative and liberal judges, it's important to note that I am generalizing--there are liberal judges who are hard-working, and conservative judges who appreciate nuance. At the same time, I have noticed some distinct patterns among liberal judges and conservative judges. In my experience, conservative judges tend to read the papers; either ask relevant questions or none at all (think Clarence Thomas); tend to work hard; tend to avoid legal seminars and other outside legal activities; and have a well-run, efficient courtroom (i.e., if someone starts repeating arguments already stated in the papers, they get cut off).

The downside to conservative judges is when they're good, they're great, but when they're bad, they're the Devil's spawn. Really horrible conservative judges, for example, think they're the only thing standing between anarchy and civilized society. As a result, if the bad conservative judge hates your case, you and your clients will get sanctioned or will suffer somehow. Another characteristic of terrible conservative judges is that if you don't suck up to them, you will pay for it. The legal system has many technicalities, and a bad conservative judge can make your trial or legal motion Kafkaesque if he feels like you're not giving him appropriate respect; in the alternative, he may just dismiss your case, knowing that your client probably doesn't have the resources to appeal.

In contrast, liberal judges tend not to sanction parties, even when they richly deserve it. Say what you want about "sympathetic" judges, but when it comes to avoiding embarrassing scenarios, I'm putting my money on the liberal judge. At the same time, generally speaking, liberal judges tend to believe their compassion and wisdom absolves them from reading every paper that is filed. Perhaps that is a reasonable perspective. After all, most law/research clerks are quite good, and they summarize the legal papers very well. The downside to relying on law clerks is that it takes a long time for a new lawyer to get any respect from some liberal judges. If a new lawyer is good, but the judge never reads his papers, the new lawyer will never get any respect.

When I first started out, I could tell who read my legal briefs by the level of respect I got from the bench. Typically, due to my youthful appearance, if a judge hadn't read my legal briefs, he would act like he was doing me a favor when I won. In contrast, the judges who had read the papers knew I wrote well, and they would treat me no differently than anyone else. Over time, I realized that most of the judges who read my papers happened to be more conservative. I really enjoyed not being treated differently just because I didn't have 40 years of experience. After all, if your papers are well-written, and you cited the proper case law, why should the number of years you've had a bar card matter?

Again, I realize this post relies on generalizations, but I hope you've enjoyed it. One last comment: if you get the chance, vote for female judges. There aren't enough of them in court, and, just like in real life, the more women around, the less likely it is that the men do crazy things. According to the Federal Judicial Center's History Office, only 25% of Article III judges are female, and only 1% identify themselves as Asian Americans. (Source: Shawna Wilson, Oct 2009, Young Lawyer.) I don't know the exact state court statistics, but a similar gender imbalance probably exists in California state courts.

P.S. I just realized a shorthand way to summarize my entire post. Have you seen the early episodes of the TV series, Scrubs? If so, think of Bob Kelso as the average liberal judge--the one who doesn't practice medicine and lets other people do much of the work--and think of Dr. Cox as the average conservative judge--the one who looks like the a**hole, but who's really the main person holding up the place. I'd probably play Dr. Dorian, who, "despite his numerous flaws, quirks, and personal insecurities," is shown to be a very competent doctor. Well, at least that's what Wikipedia says.

P.P.S. Make sure you read Ken's comment. Overall, he may be right that there are only two categories of judges: judges who require strict, slavish compliance with evidentiary rules, and judges who don't. But Ken's comment also tells you that judges have wide discretion in interpreting the evidence rules, which should tell you that the rules are too convoluted. The more convoluted the law, the more the legislature is allowing judges to potentially decide outcomes based on individual preferences.

Let me give you two examples of a judge administering evidence rules differently. In one trial, opposing counsel had numerous emails that hadn't been verified, i.e., no custodian of records appeared, no declaration, just a bunch of emails sent by some employees. No one was disputing that the employees had sent the emails. Opposing counsel waited the end of his examination before asking the court to admit the twenty or so emails into evidence. The judge, knowing my objections would require tedious parsing of the emails, glared at me, almost daring me to tick him off by making an objection. This was a bench trial (no jury), so I didn't object to the emails. The judge admitted the emails into evidence. The judge glaring at me won't show up anywhere in the record or transcript.

In another case, I had numerous emails to introduce. All emails were given to me by the corporate defendant. All the people who had sent the emails used corporate email accounts. No one was disputing that the plaintiff had sent these emails. A company employee admitted on the stand that no one had hacked into the server, and there was no reason to believe the emails had been altered or forged in any way. Opposing counsel came from a large law firm and objected several times to the emails. The judge refused to admit the emails into evidence.

What's the difference between scenario A and scenario B? I don't know what to tell you. One was a jury trial, and the other one was non-jury, but that should not have made any difference. By the way, the same judge presided over both trials.

[Update: about a year after the trial in which the judge refused to admit numerous emails into evidence, I had another jury trial with a different judge. This trial also involved several important emails. I was able to get the emails admitted into evidence.]

(A federal judge, the Hon. Judge James Rosenbaum, has tried to come up with a solution, FRE 808; however, other than one law review article, I don't see much else on this new proposed rule of evidence.)

Capitalism

Why Capitalism Fails, by Stephen Mihm:

Modern finance, [Hyman Minsky] argued, was far from the stabilizing force that mainstream economics portrayed: rather, it was a system that created the illusion of stability while simultaneously creating the conditions for an inevitable and dramatic collapse...Far from trending toward some magical state of equilibrium, capitalism would inevitably do the opposite. It would lurch over a cliff...

As Minsky observed, “Success breeds a disregard of the possibility of failure.”


Not entirely surprising, is it? Remember LTCM?

Monday, September 21, 2009

Carlos Miller, Police, and the 1st Amendment

Carlos Miller has an interesting blog. If you're into photos, police, and/or the First Amendment, check it out here.

Hat tip to Popehat. Here is "Ken" pontificating below:

I’m grateful to cops, as a group. They do a frequently awful job under frequently abysmal conditions. That job is necessary to our safety. They deserve thanks for that — as do many other groups in our society. But I fall off the “hero” bus when people suggest that I owe individual cops respect no matter how they behave, and that I owe cops an obligation to look the other way when they ignore the rule of law, and that we ought to cut cops a break when they act like bullies any more than we would cut a break to a thug in an alley.

Can I get an "Amen"?

Sunday, September 20, 2009

The Buffalo Bills Must Be Cursed

This post was inspired by the September 14, 2009's New England vs. Buffalo Bills NFL football game. New England scored two touchdowns in the last two minutes to win by one point.

I still can't believe how Buffalo grasped defeat from the jaws of victory in the last two minutes. I only caught the end of the game, and I am convinced--the Bills are cursed. Here are the facts:

1. O.J. Simpson was a Buffalo Bill. 'Nuff said.

2. In 1991, the Bills lose Super Bowl XXV by one point. It is the closest Super Bowl in history.

3. Monday Night Football, September 14, 2009. Bills lose by (surprise!) one point. Now, there are stomach-punch games, and there are stomach-evisceration games. This one was the latter.

4. Four consecutive Super Bowl losses from 1990 to 1993.

5. Four words: Scott Norwood, wide right. (Couldn't have happened to a nicer guy, it seems. Somehow, that makes it worse.)

6. Terrell Owens. (I happen to like T.O., but I'm sure every QB he's played with is rooting for the Bills to fail and happy T.O. has to tolerate harsh winters.)

Saturday, September 19, 2009

Judicial Opinion Slams Birther Movement

Praise the Lord for this [Warning: PDF file] judicial opinion against Orly Taitz and the Obama "Birther" movement. Taitz argued that a military doctor shouldn't have to deploy to Iraq until President Obama produces a legitimate birth certificate, thereby proving he really is our Commander in Chief. Here are my favorite lines from the opinion:

Finally, in a remarkable shifting of the traditional legal burden of proof, Plaintiff unashamedly alleges that Defendant has the burden to prove his “natural born” status. Thus, Plaintiff’s counsel, who champions herself as a defender of liberty and freedom, seeks to use the power of the judiciary to compel a citizen, albeit the President of the United States, to “prove his innocence” to “charges” that are based upon conjecture and speculation.

Any middle school civics student would readily recognize the irony of abandoning fundamental principles upon which our Country was founded in order to purportedly “protect and preserve” those very principles...

[If Plaintiff is allowed to prevail,] Presumably, some other military doctor, who does not resort to frivolous litigation to question the President’s legitimacy as Commander in Chief, would be required to go to Iraq in Plaintiff’s place.

This judge was appointed by President George W. Bush.

Update: Ms. Taitz is in trouble again. This time, it isn't quite so pretty. See here for details.

Friday, September 18, 2009

Annie Le and Raymond Clark

Annie Le's homicide makes me very worried. If a vivacious, bright woman's life can be cast aside so easily and so brutally, whom among us can really feel safe? (It doesn't help that I have a small sister who spends some time in an East Coast lab doing research.  Like Ms. Le, she was also born in the Bay Area.)

As much as I am saddened by Ms. Le's death, I disagree with the rush to judgment against the alleged perpetrator, Raymond Clark III. We already have a media story titled, "Picture emerges of Yale suspect as controlling." Other news reports refer to him as a "control freak."

On what facts does the media base this subjective slant? Apparently, Clark got upset if lab workers wouldn't wear shoe covers, presumably because he had to clean up after them. Other news reports mentioned issues with girls...when the 24 years-old Clark was in high school.

I don't know Clark. I don't know if he's guilty or not. I just know I am upset at the media's rush to judgment based on such flimsy facts/hearsay. In this country, the accused are innocent until proven guilty. It sickens me to think that we might be crucifying a young man's reputation because he ticked off a few employees in a lab.

Surprisingly, the media reports haven't bothered to explain some obvious irregularities. For example, why was Clark living in a Super 8 motel? All the news articles talk about Super 8. If he's a lab tech with a girlfriend (Jennifer Hromadka), why is he living in a Super 8 hotel? Is Yale using the Super 8 as temporary housing for lab techs? Seems like a simple issue to clarify, no?

Also, I hope New Haven officials quit calling the homicide "workplace violence." When I think of workplace violence, I think of laid-off employees shooting their bosses in a murderous rampage. Choking someone to death and then putting her in a small, hidden crawl space seems too pre-meditated to be deemed "workplace violence." It also doesn't seem anything like an ordinary workplace shooting, even if it is just as heinous. By the way, did the murderer not think anyone would eventually notice Le missing, especially with an upcoming wedding date? Did he presume that everyone would assume they were dealing with a runaway bride?

In any case, here's why I think the case isn't completely cut-and-dry, despite the DNA evidence. Apparently, Clark worked as a lab tech since 2004. He must have known about the card system and the video cameras, which record everyone going in and out of the building. Therefore, he would have known that nothing would show Le walking out of the building, meaning the "runaway bride" theory wouldn't work. The cameras and card check system seem like something only an idiot would overlook, and I presume you don't get to work at Yale if you're stupid.

In the end, I'm perturbed, because the crime scene seems unnecessarily violent and sloppy, but at the same time, the murderer hid the body so well, the police were stumped for several days. Perhaps Clark snapped and went after Le for some perceived slight, or he was madly jealous of her. But if he snapped suddenly, would he really think about the hidden crawl space so quickly after the murder? I don't think people walk around with back-up plans about where to hide a body "just in case." The subsequent action of hiding Le in a hidden crawl space seems to require a ready knowledge of the blueprints for the building or at least some very quick thinking post-murder.

Also, I'm sorry to suggest these things, but there must have been a large suitcase or some large bags in the building. Le's murderer could have put Le in a large bag, even if it was just a garbage bag, and then removed her from the building. (What idiot leaves a decomposing body in a place where the smell would eventually tip everyone off?)  If the murderer intended to take the body out sometime, why not just do it right then and there or soon thereafter? He had from Wednesday until Friday to go back to the lab and dispose of the body.  If you're thinking it would hard to transport 90 pounds out of the building inconspicuously, fine--but would you leave the body where the police would eventually find it?

I don't know if Clark is guilty or not guilty. When I wrote this, it was late, I was tired, I was upset at the media's reporting, and I felt like playing devil's advocate. I hope they find the bastard who did this and put him in jail for life. [Update: Clark pled guilty and is serving 44 years.]  If Clark did it, then I am happy he is in custody. I pray God will look after Ms. Le's family.

One side note: the New Haven police aren't known for being geniuses. The 1998 homicide case of Suzanne Jovin is still unsolved, and the New Haven police accused and pursued the wrong man in that case. Jovin's case is particularly interesting because she wrote her senior thesis on Osama bin Laden's threat to the United States.

[This post has been updated since its original publication.]  

If You're Thinking about Going into Law...

This ABA article should be required reading for all you aspiring law students.

Broken down by age group, the median salary of law grads who never passed the bar was $32,000 before they reached the age of 30 (compared to $48,000 for lawyers and $35,600 for college grads), $48,000 from the ages of 30 to 39 (compared to $64,000 for lawyers and $42,000 for college grads), $54,000 between the ages of 40 and 49 (compared to $83,600 for lawyers and $46,250 for college grads), and $62,849 between the ages of 50 and 59 (compared to $86,400 for lawyers and $48,416 for college grads).

Did you see the median salary for most law grads under 30 years old? Yes, your eyes are clear--it's $48,000/yr. The lesson: don't go into law just because you think the money is wonderful.

For your information, 2009 annual tuition at my alma mater’s full time law program is $38,040, or $114,120 total. At a local night law school, total tuition for a law degree is $51,156. The aforementioned tuition numbers do not include books, study aids, or bar prep courses, which can add an additional $10,000 to $15,000 to the cost of the J.D.

Why is there such a wide disparity in tuition costs between my law school and the night school? My school's alumni network is much different. I know some graduates from the night law school, and all of them are solo practitioners. Nothing wrong with being a solo (I'm one), but I don't know of any big or even small firms where this night school's grads have hiring authority. In contrast, both of my jobs out of law school were given to me by former alumni.

I am happy I managed to pay off my student loans. I had a generous housing situation, but I still had to minimize unavoidable expenses, like food, gas, suits, a reliable car, insurance, etc. I remember eating mostly peanut butter and jelly sandwiches for three years post-graduation. A few times, I forgot to pack my lunch, and I just didn't eat that day. Also, although I love coffee, I avoided Starbucks like the plague. An attorney/mentor (a fellow alumnus, by the way), would buy me lunch once a month, and I looked forward to those lunches more than he will ever know. Now, we take turns paying for lunch, which is nice.

Before I forget, I will leave you with one story about my friend/mentor. When I first met him, I had no idea he was a big shot lawyer. I got to know him because he and I both love movies, he is down-to-earth, and he seemed like a really cool guy. One time, he casually mentioned that he had taken a weekend vacation with his family, and somehow, the cost came up. It was 8,000 dollars. My eyes got wide, my head jerked back, and I remember saying, "8 thousand dollars? For one weekend? How is that possible?" The only thing going through my mind was, "That's two full years of undergrad tuition at UC Davis!" I hope my friend/mentor doesn't remember that day. He hasn't said anything about it, but since then, he's never mentioned the price of any of his vacations.

Thursday, September 17, 2009

The Law: Honesty

It's been a long day. I am still in my office. Here is my quote of the night:

No law will make an honest man dishonest, nor will any law cause dishonest men to become honest. Laws may scare dishonest men from doing dishonest acts, but at what cost? All laws increase the chances of an honest man getting caught in the government's or a lawyer's web. All laws also provide paper ammunition to an honest man's enemies. If some laws have no relation to improving honesty and morality in society, then the case for eliminating laws rather than passing new ones becomes clear.

Yes, it needs refining. I'll work on it.

Should State Bars Shield Judges from Criticism?

If you're a lawyer, should your free speech rights be curtailed? Before you criticize judges, see here for NYT article (John Schwartz, 9/12/09). The Florida State Bar reprimanded Sean Conway, an attorney, for his blog posts about local judges.

Personally, I am very conflicted. On the one hand, we should respect judicial independence, and we already allow judges to issue gag orders to prevent jury prejudice. But other than judges and lawyers--who are most familiar with the legal system--who else is able to provide reliable information on our court system?

In the final analysis, judges are government employees, not kings and queens. They are 1/3 of our representative government. It makes little sense to shield them from criticism, assuming such criticism does not negatively prejudice the parties in the case. In short, judicial criticism should turn on how the criticism affects the parties, not lawyers or judges.

David Feige, from New York, posted an interesting comment:

Judicial accountability is critical. Awful criminal court judges too often fly below the radar, eviscerating critical constitutional protections, and harming the mostly poor and disenfranchised who appear before them. It is here, more than almost anywhere that free open debate, and even freewheeling and critical commentary should be encouraged, not chilled.

Real judges have the temperament to roll with the punches, and admire and encourage argument in order to bring the truth to the fore. The fact that a judge seeks to squelch discussion, and intimidate opponents says everything one needs to know about their fitness to judge.

Amen, David.

Wednesday, September 16, 2009

Barry Ritholtz on 9/11

Barry Ritholtz talks about Bush and 9/11 here. A snippet:

When people ask why I dislike the presidency of George W. Bush, it was that colossal failure to rise to greatness on that occasion, and indeed, to engage in a series of decisions that not just in retrospect, but at the time, simply reflected terrible judgment.

Unlike many others, I only blame W in small part for ignoring the warning pre-9/11. But for the catastrophic series of decisions that followed, I hold him 100% accountable.

After 9/11, the entire world supported the United States of America. Iranians held candlelight vigils. NATO pledged immediate support. What the heck happened from September 2001 to November 2008, and why did it take so long for Americans to reject Bush's policies?

The comments on Barry's blog are also worth reading--here's one from "How the Common Man Sees It":

Though we are quite in agreement on economic matters, I am a conservative Christian that disagrees with you on many issues and I have told you so many times.

This one is not one of them.

One of the greatest failings of the modern conservative movement is its inability to admit when it was wrong. The desire to circle the wagons is only making their circle smaller. That provides for even less protection in the long run. I am beginning to believe that conservatives created, or at least inflamed the rebellion of the ’50’s and ’60’s due to rigidness alone. I just hope we learn in time so that we aren’t lost in the wilderness for another generation. The Western world can no longer afford a one party state.

Here is my post on terrorism, titled, "The Unusual Suspects."

More links:

http://www.law.umkc.edu/faculty/projects/ftrials/moussaoui/zmsamit.html

http://www.historycommons.org/entity.jsp?entity=david_frasca

http://blogs.state.gov/

Tuesday, September 15, 2009

SCU Magazine's Interview with Avraham Burg

Santa Clara University's Professor Farid Senzai interviews Avraham Burg, former speaker of the Knesset (i.e., Israel's Parliament/Congress). Here is the interview (Scroll down to "An interview with Avraham Burg," Santa Clara University Magazine, Fall 2009)

On "Never Again":

Among the Jewish people, there are two kinds of people who came out of Auschwitz: Those who say never again is never again for Jews; and, therefore, let’s have the biggest walls around us and the deepest shelters on top of us, and make sure that no Jew will be ever persecuted. The others—and I belong to their fav, or their body—say never again means never again to anybody around the world. I have to do my utmost to prevent the indifference to the "other", whoever he or she may be: the raped woman in Darfur, the boy in the inner city of Detroit.

On Peace in the Middle East:

Let me tell you an anecdote: There was a day I was driving my car on the eve of the Jewish New Year in Jerusalem. The air conditioner was broken, the heat impossible, the traffic jam like only in Jerusalem on the eve of the New Year—and on top of it, there was a bomb threat and the city was stuck. I was sitting with my then-7-year-old son and my 80-some-year-old father. My son was very short-tempered: He was hungry, he wanted to pee—you know the drill.

He said, “Daddy, how the hell do you want to make peace with these Arabs who bomb us at the eve of the New Year?”

I was contemplating: Should I simply silence him? Should I give him a philosophical answer? Should I just ignore it? I was sitting there angry at the traffic, angry at the weather, and then from the backseat my own father, who had escaped from Berlin in September '39—imagine, the very last second—said to my son: “I want you to listen very carefully. I felt at the time that there would never be peace between us and Germany. Whatever they did to us is a thousand times worse than what we do to the Palestinians and what the Palestinians are doing to us. Now we’re 40 years after the Holocaust. Here, peace with Germany. In your lifetime you will see peace with the Palestinians."

More on Israel here.

Monday, September 14, 2009

Is Christianity the Key to Civilization?

[Update: Arnold Kling corrects me, pointing out that he "was explaining what I think conservatives believe, not what I believe." Mr. Kling's blog post now states, "Again, these are what I think of as conservative beliefs, not what I believe." My post has been changed to reflect Mr. Kling's correction.]

Arnold Kling summarizes what conservatives believe, saying, "Christianity is the key to civilization and, dare one say it, the most progressive force in history." For his full post, see here.

Commenter Tom Hickey dismantles the so-called conservative argument handily:

There are several inconsistencies with this picture.

1. It seems obvious that instead of going downhill, human progress is improving with technological advancement that has vastly improved life for 99% of the the people in developed societies. Christendom was feudal. These "lost virtues" are basically a variation of the romantic ideal of the "noble savage" and the lost "Golden Age."

2. Technology, not Christianity, has been the driving force of modern civilization. Christianity has been and continues to be the enemy of science. As technology enabled leisure for universal education, life became more rational and intelligent, allowing for the establishment of democratic societies. The Enlightenment thinking that lead to democracy was not based in Christian values as much a rational thought that revolted against imposition of ideology. The founding Fathers were not "Christians" in the sense that many use this term today, and many were Deists.

3. Free markets have often led to the "social degradation" that conservatives decry, and many conservatives think that restrictions in the form of censorship could have prevented this loosening of social norms. It can reasonably be argued that the pursuit of profit has led to the pushing of the envelope of social norms, not "social degradation" pushing business. This is the old, "the devil made me do it," excuse.

Finally, caricaturing liberalism/progressivism as believing that wisdom resides with progressive elites is setting up a straw man. That is just ideological bias that fails to grasp what liberalism is about, not a reasoned statement of genuine issues. Liberalism/Progressivism is broadly based on J. S. Mill's On Liberty and Utilitarianism.

I added the following comments:

If Christianity is the key to civilization, then what about the Persian Empire, which was non-Christian? Plenty of evidence shows that great civilizations may be non-Christian--see Incas, Angkor, etc.

Moreover, assuming that violent oppression and unnecessary/excessive killings of civilians and innocent persons is not progressive, your thesis fails. If, for example, Christianity was the most progressive force in history, then why did an overwhelming number of American Christians tolerate the peculiar institution of slavery? Why did an overwhelming number of American Christians deem non-whites inferior and less deserving of equal legal protection for numerous decades? Why did American Christians, with the backing of state governments, use police dogs and fire hoses on non-violent civil rights protesters? If we agree that Southerners are more Christian than non-Southerners, then the last 100 years seem to rebut the idea that Christianity and civilized society go hand in hand; after all, fewer places in American have been more Christian and less progressive than the South.

Furthermore, why were most participants in 20th century killings and pogroms from majority-Christian countries? In fact, Christian-led governments and their soldiers have caused the most violent losses of human life over the past hundred years. See, for example, Washington's America and the Native Americans; Lincoln's America and the Civil War; Hitler's Germany; Nixon's America and Vietnam/"Operation Menu"; Truman's America and Hiroshima; Bush I's America and Iraq; Bush II's America and Iraq/Afghanistan. This violent historical record doesn't mean Christianity is wrong or inherently evil--it just means that people in power tend to oppress others who are different, regardless of religion.

Some people may argue that the aforementioned Christian-led killings were made with good intentions, but try your progressive religious argument on the millions of innocent African (slaves), Native American, Jewish, Vietnamese, Cambodian, Iraqi, and Afghan civilians who have been murdered by Christian-led governments.

In the end, I suppose it depends on your particular viewpoint. If you're an American Christian in the year 2009, America is a progressive place. As a result, I can understand why some American Christians would associate progressiveness with Christianity. However, as the death tolls above indicate, no religion can call itself progressive or truly peaceful--whoever is in power at any particular time kills whomever they consider to be "the other." Religious differences are one way of inventing "otherness" and superiority, which allows our conscience to avoid responsibility for the deaths we cause.

Being from Silicon Valley, I may be biased, but I agree with Tom Hickey: "Technology, not Christianity, has been the driving force of modern civilization." Assuming all religions may incorporate and contribute to technological advances, then associating any particular religion with progress is a subjective, historically-myopic, and divisive exercise.

[More here on religious assimilation.]

Burke A. has an excellent response to my comment:

I don't think conservatives believe that civilizations didn't exist before Christianity. Just that the enlightenment and our current American civilization is a product of that values system. Christians were/are not a more moral people, in fact the Christian ideology is a refutation of that very idea. Christianity didn't somehow support slavery because some Christians were apologists for it. Slavery is a human institution far older than Christianity, and most of the fervent abolitionists were zealous Christians.

Nor is it Christianity reflexively anti-science. Unless you think that there should be no restrictions on what a scientist can do, regardless of the effects on other people. Sure the Religious Right opposes things like embryonic stem cell research, but they certainly aren't opposed to all kinds of science. They just disagree with the moral judgments that certain scientists are making. And frankly, scientists are no more qualified to make those judgments than religious zealots, because Science is equipped to ask how, not why, or whether something is moral. It's outside the domain of science's expertise.

Furthermore, why were most participants in 20th Century wars and pogroms from majority-Christian countries? In the past hundred years, evidence shows that majority-Christian civilizations were the most violent of all. In fact, the one entity that has caused the most loss in human life over the past century has been Christian governments and their soldiers...
What about Mao's China, and the bloody wars of tribal humans? I'd say that Christians were no more or less violent than other cultures--we are just more aware of the violence of nominally Christian populations, because that culture is dominant in the Western world and that is the history we study. I also think you are making an error of attribution if you assume that Christianity is the cause of the violence. Just as you attribute the blame of slavery to Christianity. Did Christians practice slavery? Sure, but they were the first people to offer opposition to the institution and eventually make it illegal. To paraphrase, Christianity is the worst belief system on earth, except for all others.

My response to Burke A. is below:

If we eliminate wartime deaths, then you are correct--Mao and Stalin, both non-Christians, caused the most deaths in the 20th century (we'll go ahead and equate being bombed to death with being starved to death, even though part of me doesn't feel right about that comparison).

As for slavery, however, didn't the Islamic Prophet Mohammad condemn slavery on the basis of color/ethnicity centuries before most Christians accepted that such slavery was morally wrong? See, for example, the story of Bilal ibn Rabah.

Also, compared to Judaism and Islam, wasn't Christianity late in condemning slavery on the basis of color or ethnicity? For most of its history, Christian America seemed to have few qualms about mistreating/raping slaves or treating persons more harshly because of the color of their skin. In contrast, it appears that Islamic societies tolerated slavery but required better treatment of slaves. Of course, without a written historical record from slaves themselves, it's anyone's guess how they were actually treated, but evidence exists that Islamic law and culture frowned upon harsh treatment of slaves.

According to Prof. Jonathan Brockopp, for example, "Other cultures limit a master's right to harm a slave but few exhort masters to treat their slaves kindly, and the placement of slaves in the same category as other weak members of society who deserve protection is unknown outside the Qur'an. The unique contribution of the Qur'an, then, is to be found in its emphasis on the place of slaves in society and society's responsibility toward the slave, perhaps the most progressive legislation on slavery in its time."

Sunday, September 13, 2009

Economics Blog and Natural Gas

I can't believe I just learned about Loren Steffy's economics blog.

Here's one post on the Baker-Hughes/BJS merger and the price of natural gas. An analyst states that the deal makes sense if natural gas prices will return to at least $6.50 per thousand cubic feet by 2011.

I own some BJS shares. I wish there was a better way to play the price of natural gas than UNG and GAZ. Both rely on natural gas futures, not the price of natural gas itself. In addition, neither FCG nor ENY reliably track the price of natural gas because of contango.

Wall Street has invented numerous exotic products, including ways to profit from precious metals; indeed, gold and silver investors have several reliable options. But when it comes to creating a way to track the price of natural gas, suddenly, Wall Street is stumped.

Some people contend that a reliable tracking product must store the underlying physical commodity, and it is almost impossible to store sufficient amounts of natural gas. Yet, storage problems didn't stop Wall Street from having Gold and Silver ETFs. If Wall Street has products that hold gold and silver, why not natural gas?

Thousands of investors think the price of natural gas may double in two to three years. UNG, for example, trades tens of millions of shares daily. There must be many willing buyers interested in a better natural gas investment vehicle. What other investment opportunity might produce 80+% gains in less than three years? Despite thousands of investors willing to risk investing in a natural-gas-price tracking product, there is no reliable way to invest. It makes no sense whatsoever.

Saturday, September 12, 2009

Fewer Educated Women Having Kids

According to the Rutgers University Marriage Project, the higher a woman's education level, the less likely it is that she will have children:

Women with four-year college degrees or better are more likely to be childless than women with lower levels of educational attainment. In 2006, for example, slightly more than twenty-four percent of women, 40 to 44 years of age, with a bachelor’s degree, and 27.4 percent of women, 40 to 44 years of age, with graduate or professional degrees were childless compared to only 14.9 percent of those without a high school degree.

Sources: Tim B. Heaton, Cardell K. Jacobson, Kimberlee Holland, “Persistence and Change in the Decision to Remain Childless,” Journal of Marriage and the Family 61 (1999), 531-39. 7; and Jane Lawler Dye, Fertility of American Women: 2006, Current Population Report P20- 558, Washington, D.C: US Census Bureau (2008): Table 2, 5.

Where's Susan Faludi when you need her?

Friday, September 11, 2009

Can't Make Noises the Government Doesn't Like

Check out Penal Code 415:

Any of the following persons shall be punished by imprisonment in the county jail for a period of not more than 90 days, a fine of not more than four hundred dollars ($400), or both such imprisonment and fine:

(1) Any person who unlawfully fights in a public place or challenges another person in a public place to fight.

(2) Any person who maliciously and willfully disturbs another person by loud and unreasonable noise.

(3) Any person who uses offensive words in a public place which are inherently likely to provoke an immediate violent reaction.

Is it just me, or do (2) and (3) sound unconstitutionally vague?

September 11 and Terrorism

Here is my previous post on terrorism and the likely future suspects. In my humble opinion, American Muslims do not generally represent a serious threat to any state's security. Every group, however, has radicals, and we ought to focus on the methods governments should use to monitor perceived radicals. In short, balancing civil liberties with security is the real debate.

May God bless all the victims of 9/11, including their surviving families, and post-9/11 hate crime victims.

Thursday, September 10, 2009

Joe Wilson, Republican from South Carolina

First, Governor Sanford, now Joe Wilson. South Carolina can't seem to elect decent representatives. During President Obama's recent speech, Republican Joe Wilson yelled, "You lie!" Below is my letter to Mr. Wilson's office, asking him to resign. Feel free to copy and send to joe.wilson@mail.house.gov

Mr. Wilson:

Your conduct at President Obama's recent speech was unacceptable. You are dealing with the President of the United States of America, not a pitcher at a baseball game. Your heckling was boorish and showed disrespect to our Commander in Chief. Your apology is insufficient.

Please resign immediately. The great state of South Carolina has already suffered so much. It deserves new faces and credible reputations to represent its residents.

Law and Justice as Two Separate Concepts

Do you believe the law and justice go hand in hand? If so, get your drink of choice, sit down, and prepared to be shell-shocked. Unquestionably the most stunning piece I have read in recent memory:

http://www.newyorker.com/reporting/2009/09/07/090907fa_fact_grann?currentPage=all

("Trial by Fire," by David Grann)

I am completely numb after reading it. My friend Samantha S. says, "the law is not about 'justice'--it is about application of rules. It isn't perfect, but it is all we have."

Follow-up here. From the New Yorker's comments section: "The most telling irony... what the State of Texas listed as the cause of death for Cameron Todd Willingham: homicide. One fact they absolutely got right."

More here on public defenders, Gideon, and access to justice.

Bonus: how much does it cost to execute someone? Answer is here.

Wednesday, September 9, 2009

Extra-judicial Bonds

Once in a while, I come across an interesting comment on internet message boards. The following comment, from seamusmcdermott, is about our justice system:

This case highlights a problem in the justice system. Judges, prosecutors and police fraternize with one another and form extrajudicial bonds. These bonds reach into the courtroom with undue frequency, resulting in a system that leans unfairly towards the prosecution's case.

Judges need to be beyond such influences, but they aren't. Go to any courthouse (Hall of Justice?) in the Bay Area and visit the cafeteria. You'll see what I'm talking about. This isn't discussed much because people are largely unaware of it, or don't care, or WANT people convicted, even if they didn't commit the crime for which they are charged.

Stuff like this was behind the case recently where DNA evidence exculpated 55 death row inmates in Illinois. And the prosecutors STILL wanted to execute them, even though the DNA evidence clearly showed them to be innocent. Crazy, huh? And prosecutors are protected from civil action in these cases.

Mark Cuban and Unpaid Internships

I'm a huge fan of Mark Cuban. If reincarnation exists, I'd like to be reincarnated as him. Mr. Cuban recently blogged about unpaid internships and the maze of regulations involved in creating a legal unpaid intern position. See here. My response is below:

Mark’s HR representative is mostly correct. I handle labor and employment cases in California, and I tell my clients never to hire an [unpaid] intern unless they go through an authorized college program. Overall, as a business owner as well as a plaintiffs' employment lawyer, I see both the pro-business and pro-employee sides of employment issues.

Mr. Cuban and the minimum wage supporters are both correct. Mr. Cuban is correct in stating that potential employees have lost an opportunity because of the law’s expansive liability. The min-wage group is also correct when it contends that unpaid internships favor affluent and middle-class children who can afford to work without pay for some time. One can hold both positions without any contradiction.

Mr. Cuban, however, weakens his argument by refusing to acknowledge that internships favor more affluent kids. It is true that a poor kid from the ghetto could work two or three jobs–something Mr. Cuban did–and use public transportation to get valuable experience, but the overwhelming majority of the participants would not fall into the aforementioned category.

Mr. Cuban contends that it is not impossible for poor kids to participate and benefit from unpaid internships. Again, true, but when the overwhelming majority of unpaid interns are not poor kids or are supported by parents, it should be clear that unpaid internships tend to discriminate against poorer students, adults, and teenagers.

What is the solution? We need to revamp our entire educational system. Most education in America is no better than government-subsidized babysitting. When you compare American high school graduates with high school graduates from India, Pakistan, Iran, Israel, Norway, etc., the differences are stunning. Many international students specialize in a particular area and are familiar with a particular field when they graduate high school or college. American schools, in contrast, refuse to track students, equating “tracking” with stigmatizing. Other countries have no such qualms, which results in a less egalitarian, but more workforce-ready society.

America’s biggest problem (and positive) is its idealism and the idea that all students must be educated through college. Other countries actively weed out under-performers from colleges and even high schools. A more selective educational system will not go over very well in egalitarian-minded America until we realize we are failing our children in an increasingly globalized economy. The Bill and Melinda Gates Foundation is doing some wonderful things with charter schools, but it’s not enough. Teachers’ unions–which represent teachers, i.e., government workers, not children–are very powerful and will resist any educational overhaul.

Ultimately, if you want to blame someone for our unfair economic system, which favors rich kids and penalizes poorer kids, blame the American educational system and the teachers’ unions. An American high school diploma and college degree mean nothing these days. Think about why our degrees and diplomas have become worthless in proving workforce readiness. (Hint: it isn’t because of Mark Cuban.) Think about why employers want to see people work on the job before hiring them as employees. Think about whether an unpaid internship is useful in determining whether an employee and employer may find each other mutually beneficial. Ask yourself, “Does a person’s willingness to work for free indicate dedication and long-term interest?” Also, remember that no one is saying that the intern’s unpaid status should be permanent or long-term–I think Mr. Cuban is saying that an unpaid internship is a short-term “trial” period to determine whether a particular project or worker is capable of generating revenue for both the employee and the employer. In any case, don’t blame Mr. Cuban for trying to find hard workers. He’s just a realist, not a blood-sucking capitalist.

[This post has been slightly modified since its original publication.]

Tuesday, September 8, 2009

My Experience as a Lawyer

From what I see, people either distrust corporations or the government. If you tell me which you distrust more, I can probably tell you whether you're a Republican or Democrat.

But if we set aside politics, the first problem with laws is that small businesses--an essential part of our economy--get entangled in regulations that should be designed only for major corporations.

The second problem is that these small businesses--many of them immigrant-owned--don't have litigation budgets or cannot afford to pay a lawyer in advance to comply with every technical law. It just seems unfair that Mr. Cambodian Donut Shop Owner has to learn about some technical violation only when he gets served with a lawsuit and has to go lawyer-hunting.

The third problem is that government doesn't do enough to help these small businesses, even as it taxes them heavily and relies on revenue from them.

The fourth problem--and why change is so difficult--is that major corporations essentially control much of the legislation (when they're not writing it) and heavily influence Congress.

Overall, there are many laws we ought to have, but not if they also apply to small businesses. It's a shame we don't impose minimum revenue requirements on small businesses before subjecting them to thousands of pages of hard-to-understand laws.

Monday, September 7, 2009

Thought Experiment: Utilitarianism

I am borrowing the following hypothetical from Slawek W.:

John invents a cure for cancer. It is a pill, very easily made, in fact, one could make it with ingredients found in every household. He successfully demonstrates the effectiveness of this cure on several volunteers, after which he announces to the world that he has no intention of ever releasing any information about this cure. He further announces that the instructions to produce this cure have been implanted somewhere in his body in a soluble capsule which will completely dissolve in a week along with the instructions.

Let's suppose that a surgical search for this implant would end John's life.

Let's further suppose that there is absolutely no way that you can reason with John to change his mind, and you cannot reverse engineer the cure by studying the cured patients.

Now, the general population is asked what the best course of action is in this situation. John has the knowledge to eradicate cancer forever but he has no intention of sharing this information for whatever reason. Also, there is no way to forcefully retrieve this information without causing John's death in the process.

What would you propose should be done and why? Would it matter if John was your 16 years old son?

__________

My exchange with Slawek is below:

Me: I am going to assume your scenario refers to all cancers, not just one strain of cancer. Why am I getting visions of Howard Roark and his architecture plans? Actually, that's the problem with your scenario: we're not talking about architecture--we're talking about someone unreasonably withholding vital information that we know will save millions of lives. Again, the key tipping point is the fact that we know that John has the cure for cancer. Thus, this isn't like torture, where we must question the validity of the information or whether the source has the information. Here, we know the cure for cancer exists within this man and will save millions of lives. At some point, shouldn't individual liberty give way to assured benefits for all of humankind--assuming all other avenues have been exhausted completely? Your situation is extremely complex because we are taking a human life, so we are not discussing liberty per se, but a man's life. My answer? I don't know.

Slawek: You needlessly see a dilemma here. Let me simplify this for you: John is your 16 year old son. Are you still unsure of what course of action is to be taken?

Me: Yes, because I cannot envision a scenario where my son would withhold life-sustaining medicine from the public when threatened with death. The more likely scenario is that I would represent him and demand billions of dollars in exchange for the cure. Private property is not always sacred--that's why we allow condemnation proceedings, as long as the government pays proper compensation.

Your hypothetical is complex because we're not talking about property, but about guaranteed results affecting human lives. Your scenario is an offshoot of the age-old question of whether you would shoot one person to save a thousand. When I first saw that question, I thought two things: 1) I wouldn't personally shoot anyone; 2) it wouldn't matter anyway, because someone cruel enough to offer that kind of Catch-22 choice would probably kill everyone regardless of my decision. So, what's my answer to your hypothetical? There is no good answer. That's my answer.

Slawek:
Let me further constrain this scenario: nobody cruel or crazy can do anything to John. Whatever you decide will be done. What do you decide should be done?

If you have a solid foundation of morals and virtues, which is applied to every single individual in the same way then the answer is simple: nothing should be done. You cannot decide to deprive a man of his life (his property) for another man's benefit, unless you agree that another man can deprive you of yours. To agree to this is to reject your life.

If you cannot decide what you would do in this situation then your moral foundation is convoluted and contradictory. The test of your morality is the ability to apply it to every situation without making concessions or creating exceptions for certain situations. Whatever applies to another man, applies in the same way to you.

What if the subject in question would be me? The answer is clear unless you lack the basic instinct of the will to live.

Me:
It isn't that simple, because under your scenario, all options lead to at least one guaranteed death. Overall, I do believe a person may act so unreasonably as to forfeit his right to live; however, your scenario is complex, because John isn't interfering in another person's life. He's holding back progress, but that's not interference per se--it's unreasonable unselfishness. Thus, the simplified question is whether unreasonable unselfishness may result in a justified loss of life. I will give you the lawyer's answer: "It depends."

Slawek:
Your analysis is wrong. One option leads to murder, the other option leaves everything unchanged. The scenario is anything but complex. It poses simple questions: would you have your son killed to help millions of people? would you want people to kill you to help millions of people?

My answer is simple: no. I would not have anyone killed for the benefit of another man. no exceptions.

I could have also thrown in that your other son is dying of cancer which would really have made for an awkward scenario. The right answer in that case would have been the same: you don't take one man's property (life) to benefit another.

Me: Do you agree that not doing something may result in death? Here, not sharing the cure will result in either a) the guaranteed deaths of millions of people; or b) the guaranteed death of one person. Again, there is no dispute that all options lead to at least one death where action or inaction is the proximate cause of the death(s). Thus, to label one option"murder" and another "the refusal to sustain life" is splitting hairs. Overall, the question is whether unreasonable selfishness may cause a man to forfeit his right to life when his death will save millions of lives.

Let me throw the question back to you: would you shoot Hitler if you had the chance?

Slawek: Doing nothing does not result in anyone's death, it leaves the situation unchanged. Not helping someone is not the same thing as hurting them. It is not hair splitting, these are entirely different things.

The intentional murder of a person is an entirely different affair from not helping someone. You prosecute a man for murder, you don't prosecute a doctor who was on vacation when a man died of a heart attack.

Also, are you metaphorically comparing Hitler, a man who directed the murder of millions of innocent people, to John who did absolutely nothing?"

You can only decide to kill John for the benefit of other if you accept the premise that his life does not belong to him. By accepting this, you must also accept that your life does not belong to you. There cannot be a functioning society based on this premise.

Me: There is a difference between someone who lacks the power to save lives and someone who voluntarily refuses to save lives based on irrational and unreasonable selfishness.

In any case, if you wanted to prove a point about universal healthcare, you've used an ineffective hypothetical. The real issues with universal healthcare are cost control and levels of coverage, not a mad scientist's unreasonable refusal to save lives.

Slawek: Irrational and unreasonable? We'll never come to a conclusion if you start injecting subjectivity into this. Don't you find it irrational and unreasonably selfish for a heart surgeon to go on a 6 month vacation? He could be saving lives instead. How irrational and unreasonably selfish of him.

This has got nothing to do with universal health care. Not a single thing. I wanted for people who care to read it to realize that their moral framework is flawed and weak. It is in fact so weak that everyone that read this note would refuse to answer. Not give the wrong answer, mind you, but simply refuse to answer. You were intrigued enough to try to find flaws in the scenario, but still, you didn't answer. You've done every single thing not to answer so far.

You won't decide what to do in John's case because you'd see a contradiction in your actions. You don't want to kill John, but you do want millions of people to be saved from a terminal disease. But why do you just not say: kill John?

Bonus: more thought-provoking questions here.