Author Archive: Erich Vieth
Erich Vieth is an attorney focusing on consumer law litigation and appellate practice. He is also a working musician and a writer, having founded Dangerous Intersection in 2006. Erich and his wife, Anne Jay, live in the Shaw Neighborhood of St. Louis, Missouri, where they are raising their two extraordinary daughters.
I parked in front of several identical unusual parking meters in Kansas City yesterday. If a person were so inclined, he or she could simply reach into the open bottom half of the meter, grab a few coins that were already there, then put them into the top of the meter, watching them drop to the bottom again. If one were so inclined, one could completely fill the meter with time by doing this over and over. The fact that the bottom contains more than a few quarters speaks to the honesty of people from Kansas City.
But the government’s lawsuit paints a picture of a company that misled investors knowingly, more concerned about making money than about accurate ratings. It says S&P delayed updating its ratings models, rushed through the ratings process and was fully aware that the subprime market was flailing even as it gave high marks to investments made of subprime mortgages. In 2007, one analyst forwarded a video of himself singing and dancing to a tune about the deterioration of the subprime market, with colleagues laughing.
Ratings agencies like S&P are a key part of the financial crisis narrative. When banks and other financial firms wanted to package mortgages into securities and sell them to investors, they would come to a ratings agency to get a rating for the security. Many securities made of risky subprime mortgages got high ratings, giving even the more conservative investors, like pension funds, the confidence to buy them. Those investors suffered huge losses when housing prices plunged and many borrowers defaulted on their mortgage payments.
I still don’t see any evidence that Obamacare will reduce health care premiums for ordinary Americans. These cost controls were promised as the prime reason for Obamacare back when Barack Obama first ran for president. At Huffpo, Wendell Potter explains some of the reasons that healthcare premiums continue to skyrocket. It’s a story permeated with corruption, involving the malfeasance of both Democrats and Republicans. Here’s the introduction to Potter’s article, “Why Americans Pay So Much for Health Care: Friends in High Places (Just Not Your Friends)“:
If you wonder why we spend more money on health care than any other country but have some of the worst health outcomes, you need look no further than the halls of Congress to it figure out. And you need look no further back than the recent “fiscal cliff” drama for compelling proof of how decisions are often made, not based on protecting the public’s interest and bringing costs down but on protecting the profits of pharmaceutical companies, insurance firms and other special interests that grease the palms of our elected officials.
Shall we vote for our phone companies’ profit margins or for Internet access for all, resulting in true growth? The answer should be obvious to anyone who is not a phone company. The Washington Post reports:
The federal government wants to create super WiFi networks across the nation, so powerful and broad in reach that consumers could use them to make calls or surf the Internet without paying a cellphone bill every month. The proposal from the Federal Communications Commission has rattled the $178 billion wireless industry, which has launched a fierce lobbying effort to persuade policymakers to reconsider the idea, analysts say. That has been countered by an equally intense campaign from Google, Microsoft and other tech giants who say a free-for-all WiFi service would spark an explosion of innovations and devices that would benefit most Americans, especially the poor. . . . . “We want our policy to be more end-user-centric and not carrier-centric. That’s where there is a difference in opinion” with carriers and their partners, said a senior FCC official who spoke on the condition of anonymity because the proposal is still being considered by the five-member panel.