Tag Archives: Perverse Incentives

$1M in forgivable loans offered to rehab seized Marygrove homes

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“Talmer Bank is committing up to $1 million in forgivable loans for people who commit to buying homes in an area south of Marygrove College in Detroit in upcoming auctions.  The individual loans from Troy-based Talmer Bank require that the recipient live in the home and would be up to $25,000, with $5,000 of the loan forgiven for each year the owner stays in the home, up to five years total. The money could be used to rehabilitate or renovate homes in the neighborhood.  The administration will target the owners of 79 abandoned homes that are still in good condition in a west-side Detroit neighborhood as it begins going after negligent landlords who leave houses to rot in a city flush with blight.”

http://www.freep.com/article/20140409/NEWS01/304090028/Detroit-blight-Mike-Duggan

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Robbery convict imprisoned 13 years later after cleaning up his life

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“After he was convicted of armed robbery in 2000, Cornealious Anderson was sentenced to 13 years behind bars and told to await instructions on when and where to report to prison. But those instructions never came.  So Anderson didn’t report. He spent the next 13 years turning his life around — getting married, raising three kids, learning a trade. He made no effort to conceal his identity or whereabouts. In a single day last July, Anderson’s life was turned upside-down. ‘They sent a SWAT team to his house,’ Anderson’s attorney, Patrick Megaro, said Wednesday. ‘He was getting his 3-year-old daughter breakfast, and these men with automatic weapons bang on his door.'”

http://www.tulsaworld.com/news/usworld/armed-robber-was-never-told-to-report-to-prison/article_259009c0-c5c1-11e3-950a-0017a43b2370.html

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Tyler Winklevoss: Digital Darwinism

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“Mt. Gox’s closure continues to highlight the need for reasonable and responsible U.S. regulation that will both foster innovation and provide guardrails for consumers.  Currently, the lack of clarity has pushed many Bitcoin companies and VC dollars offshore.  US consumers have been forced to wire their money to Japan, the UK or Bulgaria, where there is little recourse for them if something goes wrong.  Last months hearings in New York convened by NYDFS Superintendent Ben Lawsky were a big step in the right direction.  People from over 117 countries tuned in; the world is watching.  Two days ago, Superintendent Lawsky continued to voice his prior commitment to thoughtful regulation.”

http://www.winklevosscapital.com/posts/78045275170

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Out of the ‘Shadows’: Pot Sellers Can Now Do Business With Banks

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“The Obama administration issued new rules Friday intended to ease the concerns of banks wanting to deal with businesses that legally sell marijuana.  While 20 states and the District of Columbia have passed laws allowing the sale of medical and recreational marijuana, its production, sale, and possession remain illegal under federal law. And because the federal government regulates banking transactions, marijuana dealers have been unable to get banks to do business with them.  As a result, dealers operate strictly with cash, creating a tempting target for thieves. Treasury officials say the revised rules should reduce the dangers associated with conducting an all-cash business.”

http://www.nbcnews.com/news/us-news/out-shadows-pot-sellers-can-now-do-business-banks-n30661

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State crime labs are incentivized to get false convictions

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“In jurisdictions with this practice the crime lab receives a sum of money for each conviction of a given type.  Several state statutory schemes require defendants to pay crime laboratory fees upon conviction.  Illinois crime labs receive fees upon convictions for sex offenses, controlled substance offenses, and those involving driving under the influence. Mississippi crime labs require crime laboratory fees for various conviction types, including arson, aiding suicide, and driving while intoxicated. Similar provisions exist in Alabama, New Mexico, Kentucky, New Jersey, Virginia, and, until recently, Michigan. Other states have broadened the scope even further.”

http://www.policestateusa.com/2014/state-crime-labs-incentivized-get-false-convictions/

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The drug revolution that no one can stop

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“Technology and drugs have always existed in an easy symbiosis: the first thing ever bought and sold across the Internet was a bag of marijuana. In 1971 or 1972, students at Stanford University’s Artificial Intelligence Laboratory used ARPANET—the earliest iteration of the Internet—to arrange a marijuana deal with their counterparts at the Massachusetts Institute of Technology.  That groundbreaking deal connected two teams of people who were separated by a 45-hour drive east-west across the entire continent. Today, buying drugs online is far easier and faster—and in many cases, you don’t even have to break the law.”

https://medium.com/matter/19f753fb15e0

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Drug Dealers Unfazed By Legal Pot: “Nobody Wants To Be On A List”

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“Sitting in a vegetarian café near his Denver apartment that has a bathroom covered in graffiti like ‘Urban Farming Is The Future!,’ Mario said he feared being on a medical registry while still in school.  ‘I’m afraid that information could get somehow compromised,’ he said about his fears of his loans being affected by being on a medical registry. ‘The last thing I’d want is to get my federal funding cut off.’  Owners have had to pay for an endless list of essentials, from applying for new licenses, packaging the many pounds of green stuff they grow, and instituting the state’s mandatory radio frequency identification system that tracks every single marijuana plant ‘from seed to sale.'”

http://www.buzzfeed.com/rachelzarrell/drug-dealers-unfazed-by-legal-pot-in-colorado

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Holder: Feds to set rules for banks and pot money

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“The Obama administration will soon announce [guidance] to make it easier for banks to do business with legal marijuana sellers, Attorney General Eric Holder said Thursday.  ‘You don’t want just huge amounts of cash in these places. They want to be able to use the banking system,’ Holder said during an appearance at the University of Virginia’s Miller Center. ‘There’s a public safety component to this. Huge amounts of cash—substantial amounts of cash just kind of lying around with no place for it to be appropriately deposited is something that would worry me, just from a law enforcement perspective.'”

http://www.politico.com/blogs/under-the-radar/2014/01/holder-feds-to-let-banks-handle-pot-money-181777.html

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China’s shadow banking reform faces its first test

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“Investors in the trust, which has the unwieldy moniker ‘2010 China Credit / Credit Equals Gold #1 Collective Trust Product,’ likely won’t be paid back at the end of the month after Industrial and Commercial Bank of China said it won’t bail out the product it helped to market.  The 3 billion yuan, or around $496 million, trust used its funds to make a loan to unlisted coal company Shanxi Zhenfu Energy Group, which has since collapsed. While this isn’t the first time a trust product has found itself with pockets to let, it could become the first to pass on the pain to investors, who widely perceive these products as having a guarantee from state-owned banks.”

http://www.cnbc.com/id/101348781

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Wendy McElroy: Don’t Like My Article? I Will Sue!

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“Some effects of America’s hyper-litigiousness are obvious. For example, when a corporation announces a change in its customer policies as a response to a substantial payout. Or when your neighbor declares bankruptcy because he cannot afford the damages from someone slipping on his icy driveway.  Less visible effects can be ‘chilling’ as well. A chilling effect occurs when people avoid the legitimate exercise of their rights because they fear repercussions. A common political example is a journalist who avoids criticizing the government because he fears reprisals, such as being audited by the IRS. An insidious aspect of chilling is that its consequences are often invisible.”

http://dollarvigilante.com/blog/2014/1/16/dont-like-my-article-i-will-sue.html

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