Archive for the ‘National Issue’ Category:

Voter Info Reform

January 3rd, 2009

I just read “How Should We Get Big-Money Influence Out of Congressional Elections?” on by Lawrence Lessig.  It inspired me to put down some thoughts I’ve had swirling in my head for several months.  I’m definitely not well-informed on this big-money influence isssue, but I believe Lessig is (blog and, so I will answer the questions raised in his huffington post article as a way to convey what I want to say.  The following is expanded from my comment.

1) Reformers are considering a plan by which congressional candidates who raise a threshold number of small-dollar donations would qualify for a chunk of automatic funding – several hundred thousand dollars. If they accept this funding, they couldn’t raise big-dollar donations. But they could still raise contributions up to a certain amount (such as $100 or $250), which would be matched several-times-over by the central fund, an incentive for politicians to opt into this system and focus on small-dollar givers. What do you think of this general framework?

I think this is could be a good solution, but needs discussion. What would make candidates accept this or not? I assume those who do not accept either have more money or think they can raise more money than the plan would offer. Obama had hundreds of millions more to spend than McCain in 2008, helping him win. Could something similar happen with this plan, making this solution ineffective?

Voter Info Reform Plan

Part of the general problem is that candidates with the most money will always have an unfair advantage in reaching voters. So why not change the game so money becomes less important? The fact is voters don’t always know the truth about candidates, with partial truths and lies spread by campaigns or private interest groups. The more money a candidate has, the more times voters here that candidate’s message, whether it is the truth, a lie, a catch phrase, or whatever.

One solution would be to create a central, unbiased, voter information organization. It would have 2 mandates: promoting itself as the trusted authority on all candidate information; and disseminating said information on all candidates.

The first mandate could be accomplished by requiring all candidates to promote the voter info organization when they promote themselves.   For example, all tv ads must begin and end with a short message saying “As always, for complete and accurate information on candidates, goto or call 800-123-4567”. The website would have more information and the phone number would let callers enter their address to receive printed information in the mail.  This ad sharing would have to be delicately balanced – would need to be promoted clearly but not too much, the candidate still needs to get a return on putting money into the ad as well. This idea of sharing an ad is not new – it is similar to how all cigarette ads must contain the surgeon general’s warning, or how Intel-Inside ad campaign in 1990’s worked, where Intel would pay a percentage of any computer ad if the ad displayed the Intel-Inside logo.

The second mandate is to disseminate information in popular formats, primarily a website and some type of printed material like a small phone book. Examples of information to be disseminated would include basic facts on all candidates, such as political history, voting records, positions held, fundraising records, and known affiliations. It would also contain candidate submitted information on themselves such as where they stand on all the issues. It should also contain a fact resolution section, similar to  This section could put claims into 3 groups: “verified facts” that candidates could promote if they wish, “unverified” for new or hard to prove claims, as well as a section for claims that were verified to be not true.  The fact resosution information should be disseminated in a way to promote candidates to make truthful claims about themselves and opponents, like by placing a truth meter or truth percentage next to each candidate’s profile indicating how many verified facts versus all others are found in their ads. Eventually people would learn to not trust anything unless it was a verified fact.  In the event a message is promoted containing late-breaking news, a response team must be available to address it quickly (such as Illinos governor’s arrest for attempting to sell Obama’s senate seat).  The website could also have a way for people to express themselves by answering polls, choosing candidates the intend to vote for, and unofficially voting on specific hot issues.

This solution would allow candidates to continue to reach voters, but equally promote a trusted and accurate voter information source. Fundraising would still occur in order to promote a candidate, although the balance mentioned above must be closely monitored.

Funding for the voter info organization could be funded the way suggested in (1). Another way to fund this would be to impose a fundraising tax – 10% of all money raised by candidates must go to this voter info organization, with the federal government funding if candidate fundraising doesn’t cover the costs of the organization (highly unlikely).

Now back to answering Lessig’s questions …

2) Senators Dick Durbin and Arlen Specter sponsored a bipartisan bill last Congress that would make TV broadcasters pay a fee that would be the sole source of revenue for the central fund that candidates draw from. These broadcasters get access to our public airwaves for virtually free and make billions of dollars in revenue as a result. Under this scenario, no tax dollars would be used – eliminating the central talking point by reform opponents. What do you think about a fee on broadcasters to fund this reform?

A viable solution, but what if broadcaster’s funding falls below required levels? newspapers are going bankrupt and broadcasters revenues are declining as more people spend time on the internet.

3) “Public financing” was the old name for this issue – which would no longer be accurate if the Durbin/Specter proposal passed. And the name’s not that good anyway. What do you think we should call this reform? Clean elections? People-powered elections? Citizen-funded elections? People-funded elections?

The 2 key components being modified are fundraising and candidates. So how about “Candidate Fundraising Reform” ??

However, my proposal goes beyond just fundraising to include information, so how about “Voter Info Reform” ??

4) Barack Obama is on the record supporting the reform of presidential public financing. Some reformers want to pass presidential financing reform first, then pass a separate congressional bill down the road. Others want to merge the two bills and have one joint national debate. What do you think?

When just considering fundraising, presidential campaigns are a different beast due the magnitude of money involved ($600 million in obama’s campaign), so I think it should be handled differently. The next presidential election is 4 years out, but congress elections are less than 2 years, so congress should come first or they should be done together.

What do you think of my Voter Info Reform?

Vote November 4

November 3rd, 2008

I like making a voting guide (cheat sheet) for myself.  The process forces me to spend time researching the issues and the candidates, which is almost as important as voting.


This will be the first time I voted outside of California in 13 years, and Illinois is a bit different – each name has a unique number in parenthesis (great for cheat sheets), and no state or city propositions on the ballot, just elected officials (mostly judges). Voting on Election Day goes from 6am to 7pm in Chicagoland.

President: (1) Obama/Biden, Democrat
US Senator: (10) Kathy Cummings, Green
US Representative, 4th District: (13) Luis V Gutierrez, Democrat

Constitutional Convention: No
State Senator, 20th District: (17) Iris Y Martinez, Democrat
State Representative, 39th District: (21) Jeremy Karpen, Green
Metro. Water Recl. District Comm. choose 3 of 9: (29,30,31) Picking all 3 Green candidates
State’s Attorney: (32) Anita Alvirez
Clerk of Circuit Court: (35) Dorothy A Brown
Recorder of Deeds: (38) Eugene Moore
Board of Review, 2nd District: (41) Joseph Berrios
Judges:  Only one choice, skipping this section.

Basically I am voting either democrat or green.  It was difficult to find details on local candidates, I would often have to google for a specific name and the office they were running for to get information.  However I did like this Chicago Voting How-To Guide and  Also check out a sample ballot for my neighborhood.

This is also the first time Illinois is offering early voting for a presidential election – 18 days (?) ending October 30, 2008.  260k people voted early, which is about 5% of the total Illinois votes cast for president in 2004.

Financial Bailout

October 8th, 2008

This is the hot topic of the year, if not the decade, so I might as well comment on it. First let me summarize some well known facts, than I’ll point out a few things I learned after some digging in Wha? below.

As you may know, last Friday October 3 the 451 page “Emergency Economic Stabilization Act of 2008” was passed – $700 billion bailout of the financial markets by US Government – $250 billion now, $100 billion later with president approval, $350 billion later with congressional approval.  Money comes with an oversight board, new office of financial stability, and a few other good moves.   It also contained an estimated $150 billion in earmarks or pork spending.  “Thats just the way things are done in Washington DC” – Senator McCain. Some of these are not bad, but they have nothing to do with the financial bailout. US Government must end this “bill rider” practice (earmarks, most importantly).

Here are top 10 sweeteners (all are basically federal tax breaks)

  1. Wooden Arrows .. worth $200,000 to Rose City Archery in Oregon
  2. Motorsports Racing Tracks .. worth $100 million
  3. Rum imported from Puerto Rico and the Virgin Islands .. $192 million
  4. Research in US .. $19 billion (Microsoft, Boeing, EDS, etc)
  5. Exxon Valdez plaintiffs ..$49 million
  6. Subsidize Rural Schools .. $3.3 billion (OR, ID)
  7. Deduct sales tax from federal income tax .. $3.3 billion (TX, NV, FL, W,A, WY)
  8. Keep Film/TV production in US.. $478 million (CA)
  9. Wool Fabrics .. $148 million
  10. American Samoa .. $33 million
  11. BONUS – Employers paying employees commuting on bikes .. $10 million (OR)


Getting back to the bailout – What caused this problem? That’s the hard question, and nobody knows the answer, but there are several contributing factors – Banks should not have given loans to people who could not pay them back.  Financial markets should not have blended and repackaged these riskier loans into things that were considered “safe”.  Government should not have left the CDS market unregulated.

What is CDS?  Credit Default Swaps.  This is a relatively new market that is entirely unregulated and limited to huge financial institutions.  When i say huge, i mean those that afford to pay billions.  For example, a hedge fund might want $1 billion insurance on Risky Corp. So they pay morgan stanley $20 million a year, and in return, Morgan Stanely would pay the hedge fund $1 billion if Risky Corp went bankrupt. Sounds like insurance, right? Well, if it was, insurance laws would require Morgan Stanley to keep cash reserves to cover the $1 billion, making it safer. So it is not called insurance .. keeping all that cash around to cover your promises limits how much you can promise, limiting the amount of profit you can make on these promises. In fact, in 2000, Everybody (president, senate, house, sec. treasurer, SEC, greenspan) agreed to keep the CDS unregulated.

How bad did it get in the CDS markets? First you have to understand hedging. In the example above, we have Morgan Stanley promising a hedge fund $1 billion if Risky Corp goes bankrupt, in return hedge fund pays 2%/year to Morgan Stanley. This is the CDS Contract. Now Morgan Stanley might turn around and buy $1 billion insurance on Risky from Lehman. Therefore if Risky goes bankrupt, Morgan can pay the hedge fund $1 billion using the $1 billion they get from Lehman. That is hedging – covering one position with an opposite position. Now understand speculation. If Risky looks like it is more likely to go bankrupt, more hedge funds buy $1 billion CDS contracts on it – they wanna get paid big if Risky goes under. Of course, they will be charged a higher fee per year, maybe 5% or 10%. But a smart hedge fund speculating on dozens of companies going bankrupt will bring in far more cash on bankrupt payouts than cash spent on those fees. That is speculation – betting on an asset going up or down. So lets say in the end, there are 10 CDS contracts on Risky Corp, $1 billion each, totalling $10 billion on the CDS market on a $1 billion company. Risky goes bankrupt, only able to pay off half its debt to its investors. Investors lose $500 million. However, $5 billion is lost on the CDS market. OUCH. One of the key things here is that you can buy/sell CDS contracts on any company at any time. This speculative nature in CDS markets is bad. In 2008, CDS maket was $60 trillion in contracts on $5 trillion in assets.

Let me repeat.  In 2008, there was $60 trillion in an unregulated CDS market – that’s more than all the money in all the stock markets in the world.  Thats insane. This is why Warren Buffet famously described derivatives bought speculatively as “financial weapons of mass destruction.”

Mortgage Backed Securities (MBS) are also problematic.  When you get a home loan from your bank, the bank packages up various loans and they turn into MBS.  These are regulated, unlike CDS, but the risk was not accurately rated.  No need to dissect this one – you’ve heard it all before – banks should not have been giving loans to people who couldn’t pay, markets should not have been buying these risky things and trading them like they were not risky, and these big banks should not have put all their eggs in one risky MBS basket.

A bit confusing, a bit interesting.  So what does that tell you?

I’ve learned that at least one area needs work – Assigning risk accurately.  Also, debt in the financial system is made extremely complicated by very smart people, so nobody really knows how big the problem is.

What’s the solution?  I’m not sure regulation helps, but transparency does.  Create rules that require transparency, and fine heavily (millions) when people do not abide.   For time-sensitive things, force transparency to a neutral agency that will hold information for a short time, fining heavily those whose actions don’t match what they said they did. Transparency helps math geniuses at the financial institutions assess risk more accurately, and leaves a trail for CEO accountability.

CEO’s who move debt around for years while they pay themselves millions should be forced to return cash when debt is revealed. If a bank robber steals $100 million, the bank and the feds go after the robber and the $100 million, even if the robber gives the $100 million to his mom as a bonus.  So if a corporation goes bankrupt, why do the CEO’s get to keep the millions they received?

Thats all for now .. if i missed any big points, please leave a comment.

Spoofing Caller ID

October 2nd, 2008

Did you know Caller ID can be faked, legally?  For example, Annoying dude can call your mom and fake it so your mom thinks the call is coming from you.   There are even businesses that exist to serve this annoyingly evil purpose.  Relief is in sight – there are bills (not yet laws) outlawing “any caller identification service to transmit misleading or inaccurate caller identification information” – more at wikipedia.

My iPhone has recently been receiving harassing calls from one number – 904-954-3072 – up to 4 times a day, for like 10 days now.  I’ve only answered a couple times and I hear nobody on the other side.  I’m not the only one – some say it’s Citicards debt collectors but most think it’s a scam. My guess is caller id spoofing.

UPDATE 10/14/2008 – It probably was Citicards.  I recently moved, and didn’t update one of my credit cards with my new address.  I talked to citibank and she said they do have a service that automatically calls if bills are not payed.  I asked why they don’t talk when you answer the phone or leave voicemail messages.  She said they don’t leave messages in case phone number was changed, and as far as not talking when you actually answer and say hello .. well, she said there’s a problem with the system.  I told her it was annoying to get the calls and she agreed, but they would stop in the next few days.  CITIBANK IS LAME.

VT Tragedy

April 21st, 2007

Yes, I went to school at Virginia Tech, where the recent tragedy occurred. I’m here in Asia and got the news a few days late, and i really don’t know what to say. The guy who shot and killed 32 others on Monday, April 16, was not … well …. and i feel for the families and those in Blacksburg who are coping with the tragedy. Thankfully events like this do not happen very often, but they definitely bring out the humanity in many of us. You can read many details from VT’s tragedy page., including a timeline of events. That is all.