Justinian Lane - Commentary on law, politics, and tort "reform."

Pet Safety Alert – Pig Ears and Beef Hooves May Be Contaminated With Salmonella

The FDA tries to keep our furry friends safe, too.  Make sure that if you have these you dispose of them properly.  And properly means in such a way that a neighborhood stray can’t get to them!

The U.S. Food and Drug Administration is issuing this health alert to warn consumers not to use Pig Ears and Beef Hooves pet treats manufactured by Pet Carousel because the products may be contaminated with Salmonella. The products were distributed nationwide in both bulk and retail packaging for sale in pet food and retail chain stores. Pet Carousel is based in Sanger, Calif.

Source: FDA Health Alert for Certain Pet Treats Made by Pet Carousel

Rick Wagoner vs. AIG

Why is it that Rick Wagoner is forced out of GM, but Obama doesn’t ask all the managers at AIG who screwed the economy to leave?  I’m really sick and tired of the contrast between how the Big Three are treated vs. AIG.

The Big Three are victims of the economic crash, not the cause of it.  If not for oil speculators driving gas prices to $4 bucks a gallon, people would still want to buy SUV’s.  And if not for AIG and the others responsible for the economic meltdown, people would still be able to get loans to buy those SUV’s.

It gets incredibly irritating to hear the constant refrain that we can’t afford to lose the people at AIG who raped the economy, and then hear we need to sack everyone at the Big Three.  If anyone needs to be shown the door, it’s everyone at AIG in a managerial capacity.  Those guys did a worse job than the lookout on the Titanic; that guy only missed ONE iceberg whereas these guys made mistake after mistake after mistake.

Technorati Tags: Rick Wagoner,AIG,Big Three,GM

Interesting coincidence regarding Alaska volcano eruption

Last night, Dante’s Peak was on.  It’s one of my favorite movies to heckle, not least because (a) the movie depicts tires as able to survive multiple thousand degree lava, and (b) I hate grandma Ruth.

But anyway, it was on last night and I joked about how Republicans tried to portray Sarah Palin as someone like Linda Hamilton’s character: Someone who has been through a disaster and has what it takes to lead the nation through another.  Just hours later, the Alaska volcano goes off.  Coincidence, or conspiracy? :)

It will be interesting to watch if Madam Governor tries to exploit this volcanic eruption for her own career, won’t it?

Technorati Tags: Alaska,Alaska Volcano,Mount Redoubt,Sarah Palin

Not unaware, just uncaring

Representative Tim Ryan puts too much faith in AIG executives:

In the House, Reps. Steve Israel, D-N.Y., and Tim Ryan, D-Ohio, introduced a bill that would that would tax at 100 percent bonuses above $100,000 paid by companies that have received federal bailout money.

"We will use any means necessary," said Ryan. "It boggles my mind how these executives can be so unaware of what the American people are going through."

Source: reviewjournal.com -- Associated Press News

I worked for a Swiss bank in NYC for a period of time, and I’m comfortable stating that these executives:

• Think they’re better than the working-class Americans.
• Think they’re entitled to these bonuses merely because they show up to work.
• Don’t care about the problems facing working-class Americans.
• Are looking out only for their own best interests.

That’s the way the banking world works, folks.  People who have the kind of jobs that pay out $1 million dollar (and higher) bonuses neither understand nor care about problems of regular working people.

Technorati Tags: AIG bonuses,AIG,Tim Ryan,Steve Israel

Boo frickin’ hoo – where was CNN when this happened to me?

Oh noes!  Some banker in California had to sell his expensive cars and suits and look for a job and now he’s humbled:

"It took a lot for me to put that ad on Craigslist, because I had to change what I was before," he said, breaking down in tears. "I wasn't this rich little yuppie anymore, driving expensive cars, having expensive suits. I'm in this just like everybody else looking for work. It humbles you. This is real."

Source: Humbled banker parts with yuppie past - CNN.com

Dude, I don’t know how to tell you this but if you were making $70k a year in Los Angeles, you weren’t a “rich little yuppie.”  You were barely scraping by.  $70k a year and he routinely stayed in “the most expensive hotels in Las Vegas?”  Yeah, maybe if he slept in the janitor’s closet.  $70k a year hasn’t been a lot of money in California for decades. 

I have to admit I’m getting irritated at all the media attention people who are losing their jobs are getting; CNN didn’t interview me when I lost my house/job/car, nor did it interview my friends who faced similar challenges.  And none of us got any bailout bucks, either. 

We just sucked it up and dealt with it.

Technorati Tags: yuppies,CNN,craigslist,$70k isn't a lot of money in California,bailout

A 54k a year mortgage when you make $39k a year? This is why I don’t feel sorry for most of the “victims” of the subprime crisis.

There is one class of person who I truly feel sorry for regarding the subprime crisis: Those who got a mortgage they could afford, and then lost their job.  But my sympathy meter is almost at zero for people like this:

She says in 2006 she and her husband put a total of $50,000 down -- their life savings -- on a house they purchased for a little more than $500,000. About 3,400 square feet, it has five bedrooms and three bathrooms.

"They approved us for the loan, but my husband only made $39,000 a year as a supervisor at Pulte Homes," she says. "They told us we would have a $4,500-a-month house payment, and we said we couldn't afford that. But the loan processor said to sign, that we could refinance in six months to a much lower payment ... that the interest rate of 10.75 percent would go down."

However, a chance at refinancing did not come for several months, Rosie Adaoag says, and the payment only lowered to $3,800 a month.

"We took money from my husband's 401(k) and borrowed from many people," she says. "But we finally couldn't make any more payments last year. That's why we got foreclosed on."

Rosie Adaoag says she and her husband repeatedly stressed their concern to the mortgage lender that they couldn't afford the house before they bought it, but were told that, through creative financing, "it would all work out."

"They weren't honest with us. We shouldn't have trusted them."

Source: ReviewJournal.com - News - Henderson officer sees families grieve over evictions

Let’s do some simple math:

If you make $39,000 a year, you gross $3,250 a month.  That means that you can’t afford a $4,500 a month mortgage. PERIOD.  If someone is telling you otherwise, they’re either an idiot or a liar.  And if the person who is telling you otherwise is going to make a bundle by convincing you to take the mortgage, that person is a damned liar.

I generally don’t feel sorry for greedy people, stupid people, or stupid greedy people.  People who get mortgages with monthly payments that are $1,200 a month more than they gross fit into one of those groups.

They are of course suing the lender to get their money back:

In the weeks since the Adaoag family was evicted, the family's self-filed lawsuit asking that the eviction be stopped because of unfair lending practices was denied.

"I'm sure another lawsuit will be successful," Rosie Adaoag said in a recent interview. "We have to get our money back. We just have to."

They wouldn’t want me on the jury.  There’s a principle in the law that says you can’t sue someone for fraud if the fraudulent statement is so outrageous no reasonable person would believe it.  Hence, if I buy a 2009 Rolls Royce from a guy who claims it was William Shakespeare’s personal car, I can’t sue him when I find out that it wasn’t.  For similar grounds, I wouldn’t allow a person to recover because they believed that “creative financing” would allow a person to pay a $54,000-per-year mortgage when they only make $39k.

But that’s not to say the lender’s are blameless.  Oh no.  If I can figure out that a guy earning $3,250 a month can’t pay a $4,500 a month mortgage, so could the crooks at their mortgage lender.  The system went horribly awry if ability to repay wasn’t factored in at all in whether to approve a mortgage.  I suspect there’s an easy fix to make sure this never happens again: Don’t allow lenders to sell their mortgages. 

That simple cure would ensure that lenders don’t make mortgages they don’t feel comfortable with.  Sure, it would probably make it much more difficult for many people to buy homes, but every American citizen does not have a God given right to homeownership.  It’s not written into the Bill of Rights that “no person shall be denied a mortgage based upon inability to pay.”  Homeownership is not a right.  It’s something that you have to earn.  You don’t get a house just by showing up.

What makes matters worse is that the people in this news story likely could have afforded a $175k mortgage without a problem.  I suspect their greed is what drove them to buy a $500k mansion instead of a $175k house.  People - don’t bet the farm if you can’t afford to lose the farm.

Now of course my tax dollars are going to bailout people who got mortgages they knew they couldn’t afford, the banks who made mortgages to people the banks knew couldn’t afford them, and the insurance companies who insured mortgages. 

What’s next?  A bailout for gambling addicts?

Technorati Tags: bailout,mortgage mess,subprime crisis,gambling bailout,stupid people,greedy people,stupid greedy people

Tort reform hypocrite turns to “terrorists” to get his money back

Do you remember way back in February of 2004 when Hank Greenberg (then the Chairman of AIG) said that trial lawyers were terrorists?  Well, now Greenberg has hired those same “terrorists” to help him get his fortune back.

NEW YORK (AP) — The former chief executive officer of American International Group Inc. on Monday sued the company he led for 38 years, saying AIG misled investors about its exposure to subprime mortgages.
Maurice "Hank" Greenberg, 83, claimed in papers filed in federal court in Manhattan Monday that the company, once the world's largest insurer, has ruined his fortune by lying about its financial health.

The lawsuit says Greenberg, who served as AIG CEO from 1967 until he retired in March 2005, was the New York-based company's largest non-institutional shareholder.

Christina Pretto, a company spokeswoman, said: "We believe the suit is without merit and we will defend ourselves vigorously."

Source: Former AIG CEO sues the company in NY, saying AIG took his fortune through deceit -- Newsday.com

Greenberg’s change of attitude shows us:

1. Trial lawyers are evil, until you need one.
2. Lawsuits against companies are bad, unless you’re the plaintiff.
3. Hank Greenberg has no shame whatsoever.

The guy was Chairman of the company until Spring of 2005, and now he’s claiming he had no idea about how much exposure AIG had to subprime mortgages.  Last I checked, he was Chairman during the worst part of the subprime bubble.  Maybe Hank should sue himself for not doing a better job running the company.

Or is the guy gonna claim that for the 38 years he ran the company, it did nothing wrong, and as soon as he left, all the shenanigans happened?  Hank, much if not most of AIG’s trouble started on your watch.  Thanks to 38 years of your incompetent leadership, Hank, taxpayers have already given AIG $170 billion dollars.  I think taxpayers ought to have subrogation rights and get repaid out of anything you recover.

Boo Hoo, Hank.  Here’s hoping you end up working as a greeter at Wal-Mart.

Technorati Tags: Hank Greenberg,AIG,tort reform,hypocrisy,tort reform hypocrites

Putting your head in a vice and smashing your hand with a hammer

OK, maybe I watched Casino one too many times, but that’s the first thing that came to my mind when I read that casinos will “take the same steps” if they catch someone counting cards with an iPhone:

"If a player uses the program and is caught inside doing so inside of our casino, we will take the same steps that we follow in any other situation where cheating is involved," said a manager at one of Las Vegas' casinos.

Source: Apple Program Helping Players Cheat In Las Vegas Casinos

If you need an iPhone to count cards for you, you shouldn’t be in Vegas.  Stay at your lame frat house poker parties where you can just pretend to be texting some hawt girl.

Technorati Tags: card counting,iPhone,Las Vegas,Casino

What scares drug makers more than lawsuits?

Being forced to disclose whether their drugs are more effective than competing drugs:

WASHINGTON -- The drug and medical-device industries are mobilizing to gut a provision in the stimulus bill that would spend $1.1 billion on research comparing medical treatments, portraying it as the first step to government rationing.

. . . .

Companies "want to control the data, how it is reviewed, evaluated, and whether the public and government find out about it and use it," said Harry Selker, a Tufts University professor who directs its clinical-research program.

That also worries Jerry Avorn of Harvard Medical School, a frequent drug-industry critic. Comparative research "has the potential to tell us which drugs and treatments are safe, and which ones work," he said. "This is not information that the private sector will generate on its own, or that the industry wants to share."

Source: Drug Makers Fight Stimulus Provision - WSJ.com

The fact that the industry opposes efforts like this shows that the industry is more concerned about its own profits than the health of patients.  Naturally, the industry is campaigning against this provision by forming a group called “Partnership to Improve Patient Care.”  It should be “Partnership to Protect Pharmaceutical Profits.”

What they really fear is that the government will determine that Brand X isn’t as effective as the less-expensive Brand Y, and will therefore no longer pay for Brand X under Medicare.  The industry is portraying this as a slippery slope towards endangering patients.  In actuality though, it might be a slipper slope towards patient safety.  Recall that Trasylol (a) killed thousands of people and competing drugs didn’t, and (b) was much more expensive than those safe, competing drugs.

With a program like this in place, perhaps some of the thousands of people killed by Trasylol would still be alive.  Better yet, taxpayers might not have paid for the drugs that killed them.

Of all the groups that belong at the patient safety table, I don’t think pharma should be one of them.  They’re a group of businesses who have repeatedly and routinely put lives at risk in order to make a profit. 

Technorati Tags: Pharmaceuticals,Obama,Stimulus,Partnership to Improve Patient Care

Could the FDA have any less power?

One has to wonder…

WASHINGTON (Reuters) - The U.S. Food and Drug Administration lacks access to food safety tests that could have helped identify problems at a peanut plant at the center of one of the biggest food recalls in U.S. history, members of Congress said on Thursday.

The salmonella outbreak traced to a Peanut Corp. of America plant in Blakely, Georgia, has sickened more than 550 people, more than half of them children, and may be linked to eight deaths.

"We would like to have more information. There is no question," Stephen Sundlof, director of the FDA's Center for Food Safety and Applied Nutrition, told a hearing of the Senate Agriculture Committee.

Under law, a company does not have to notify the agency if it discovers salmonella or other contamination. The only time FDA can require information from a plant is if tainted product was shipped from it. (Emphasis added.)

Source: FDA lacks access to food safety records: Congress | Health | Reuters

I’m so glad the FDA is charged with keeping us safe.

Technorati Tags: FDA,salmonella,peanut butter,peanuts