July 26, 2003
Swagging the government’s revenue estimates

Making policy choices in government requires estimating the effects of various legislative alternatives on the money used to run the public’s business.

What some folks may not realize, however, is the extent to which that estimating process involves swagging.

The root word “SWAG” is an acronym, meaning Scientific Wild-Ass Guess.

Jonathan Weisman wrote a good story in today’s WaPo that explains how swagging can have pretty stark results in the current budget debate, especially when the SWAGs are off, and the folks doing the swagging don’t know why:

Where has all the tax revenue gone?

"No one knows," said Douglas Holtz-Eakin, the director of the nonpartisan Congressional Budget Office. "Not answering the question is just admitting our ignorance."

Weisman reports that there’s been a $269 billion drop in tax revenue since 2000, and no one seems to understand how that happened.

Thanks to the deep complexities of the U.S. economic system, the four best sources for Federal budget revenue forecasts have been corporate tax receipts, personal income taxes that employers withhold, payroll taxes going to Social Security and Medicare, and the estimated personal income taxes filed by individuals not subject to withholding.

Of these, the corporate taxes and personal estimated tax receipts seem to be the two primary sources of the recent faulty estimates.

Robert D. Reischauer, a former CBO director now at the Urban Institute, said income tax receipts in the late 1990s were probably inflated by huge bonuses, sales commissions and the redemption of stock options, all of which depended in part on swollen stock prices.

Unlike capital gains taxes, those windfalls are reported as ordinary income, not a separate line item in tax data. Determining just how much of the tax take of 2000 came from bonuses and stock options is next to impossible, and so is backing those factors out of current projections. But they do tend to come to the Treasury as non-withheld income taxes.

Likewise, past capital losses and other adverse impacts of the 2001 bust may still be depleting tax takes, because they can be used to offset current taxation. That could be depleting corporate taxes.

I wonder to what extent government tax receipts are simply lagging indicators of the general economic health, much like unemployment statistics. It makes sense that they would be, especially since three of the four primary cash sources used for these swags are based on personal income.  

In any event, as this story illustrates, the experts in Federal budget forecasting are not much better than the folks at the Weather Channel are at their jobs. It’s not hard to describe current conditions, but anything beyond the next week or so is a total crapshoot.

That’s something to be kept in mind as the next presidential election cycle heats up, and the political parties cite conflicting budget numbers to bolster their side and attack the other.

A little skepticism should go a long way.

July 25, 2003
Five Claudes for this one

Sometimes the Claude-worthy candidates appearing in the national news media are just stunning.

Today’s winner certainly was:

Bush Nominates Conservatives As Judges

This sand-pounder would have earned even more Claude points if the accompanying article was one of those thumb-sucking analytical pieces, looking at the entire panoply of the Bush Administration’s successfully confirmed judicial nominees.

As it is, the report briefly discussed two new nominees, accompanied by the routine statements of outrage from the usual suspects.

Senator Charles Schumer’s comments produced a wry grin almost immediately:

"I'm not prejudging them, but from what I know, they both look like they're coming straight out of the ideological judicial activist factory."

Oh, please.

Don’t kid a kidder.

With statements like that one, the good Senator is pushing hard for his own Claude award.

July 24, 2003
WMD Alert

So, did I miss anything while I was gone?

The one bit of news I did enjoy reading dealt with the discovery and elimination of at least two particularly nasty weapons of mass destruction.

I hope the coalition of the willing have continued success finding the rest of the WMDs--the ones made with metal as well as the more dangerous ones made of flesh.

July 19, 2003
Blogging break

I'm going offline for a bit. In the meantime, check out the essay titles on the contents pages and see if there's something there that interests you.

As always, thank you for your patronage.

July 19, 2003
Sex on the beach--fun for you, maybe, but not for the folks that can't avoid seeing you

I worked as a park ranger the summer between college and law school.

The experience absolutely cured me of any possible interest I might have had in direct law enforcement as a career.

Among the less pleasant activities, I had to approach couples making love just a few feet from a popular nature trail, and tell them to get their clothes on or leave the area.

Suddenly meeting a khaki-clad ranger with a badge and handcuffs while in the throes of passion wasn't all that pleasant for the lovers, either.

There's no denying that sex in public parks and other beautiful outdoor public spaces is frequently tempting for the participants. Nonetheless, it's rarely a treat for those who can't avoid seeing them. To be blunt, it also frequently shows a total disregard for the sensitivities of other park users.

It's also never going to stop. It will continue to be a low-intensity conflict that law enforcement officers will have to manage.

This morning's NYT ran an article about arrests for public lewdness at a beach in the East Hamptons popular with the gay community.

The police chief's comments showed that he is a practical guy with a common sense approach to enforcing the law:

The chief said that after receiving complaints of public sex and urination, he began sending undercover officers to the beach on Friday nights for "surveillance, not a raid," and that his officers were given clear orders to arrest only those people having "blatantly public sex."

"I told them, `If you can actually see it happening, arrest them. If you can't see it, don't,' " he explained. "I instructed them that if people are having sex in a car and it's dark, don't get involved. If they're under a blanket 50 yards down the beach, leave them alone. But if they're 50 feet off the blacktop and engaged in a blatant oral-sex act, not hiding it, that's public lewdness."

One man was clearly unhappy with what the article described as a "crackdown," which is not a term I would use in reporting on this topic. He also helped prove the point that the heterosexual community does not have a monopoly on making idiotic remarks:

"It's an insult and it's annoying and it's been going on through the centuries," he said. "Until they put us on a train to Buchenwald, my lifestyle's not going to change."

Another man's comments summed up most people's feelings on the matter quite nicely, in my opinion:

[A] man walking the beach at sunset sipping from a glass of red wine, who said he was 45, gay and a personal trainer, agreed with the homeowners.

"This is a public beach," he said. "If I spent $18 million on a home here, I certainly wouldn't want to watch people having sex on my dune. You should see this beach on a Friday night. There's like 100, 150 cars in this parking lot. It's out of control."

A bit more respect for the feelings of others can go a long way. That's not news for most of us, but some folks apparently need a reminder.

July 18, 2003
Doing the right thing after doing the wrong thing

Today's news included a heartwarming tale involving the quiet acceptance of responsibility.

A passenger on a Walker International charter flight videotaped the pilot during the trip from the Bahamas to the U.S.

Unfortunately, the tape was not too flattering. According to the AP story,

[it] shows the pilot with his eyes closed and apparently sleeping during the flight.

Faced with this evidence, the man simply resigned.

Bill Jones, Walker International's general manager, said the man had been a charter pilot with the company for about a year. He said the man denied he was sleeping during the 55-minute flight, but decided that the videotape and the resulting publicity "made a difficult situation."

"He thought it was the best thing to step down," Jones said.

Sometimes it seems rare and noteworthy that a person would quickly and quietly accept responsibility for their own actions.

Those inclined toward cynicism might think the more likely result here would be a claim that the pilot should be absolved of any fault for the incident under the Americans with Disabilities Act, arguing that perhaps he suffered from narcolepsy or some similar sleep disorder.

That kind of argument's been tried before, with decidedly mixed results. For example, an anesthesiologist lost his position at a Kentucky hospital when his co-workers complained about his sleeping during surgery.

After all, when both the gas passer and the patient are completely out of it, something's wrong.

As the Sixth Circuit held, the ADA recognizes a difference between firing someone for their disability and firing someone for their wrongful work behavior.

In this case, however, the unfortunate pilot did the right thing after doing the wrong thing.

That was commendable. I hope it's nothing serious, and that he can find his back to another job soon.

And this time, I hope he stays awake.

July 17, 2003
A rare judicial reference to common sense

It’s not often that an appellate court directly refers to common sense in support of its decision.

It’s almost always noteworthy when it happens, especially in First Amendment cases, where the triumph of the theoretical over the practical seems to be the norm. 

This dispute was about advertising on public property.

Public transit systems often carry ads on buses and bus shelters under their control, typically under contractual arrangements in which the winning bidder pays for the right to operate the ad business using the spaces made available.  

In addition, city governments sometimes make their rights-of-way available for bus benches at the scheduled stops. Ads on these benches can supplement a city’s revenue stream, so the municipalities enter into similar advertising agreements as the public transit agencies do with their buses and shelters.

The City of Hollywood, Florida entered into one of these bus bench deals with the Hollywood Jaycees. The agreement initially prohibited certain advertising however, specifically ads relating to

liquor, tobacco, X-rated movies, or massage parlors.

On the other hand, Uptown Pawn & Jewelry was able to buy ad space on these benches, and did so for fourteen years. 

As the Jaycee agreement expired, the City sought bids for the next bus bench deal. However, the new Request for Proposals expanded the list of ads Hollywood did not want to see:

"[T]here shall be no liquor, tobacco, X-rated movies, adult book store, massage parlor, pawn shop, tattoo parlor or check cashing advertising of any nature whatsoever placed upon the public benches."

The eventual winning bidder followed these new terms, and told Uptown it wouldn’t renew the pawnshop’s advertising contract for the bench spaces. The pawnshop owners then sued Hollywood, alleging that the First Amendment barred this restriction on bus bench ads.

On appeal after losing in the District Court, the pawnshop owners appealed to the Eleventh Circuit.

The first issue centered on whether the benches were a newly created public forum. If so, the City’s decision would be subject to strict scrutiny under First Amendment case law.

The appellate panel upheld the lower court determination that these benches didn’t fit that description.

After all, other than providing places for folks to sit, the main reason for the benches was to raise money for Hollywood, a fact that Uptown conceded. In addition, the ad limitation that was in the original agreement showed that the City intended to maximize its revenue in a business-like manner. Hollywood did not intend to create an open forum for all potential advertisers.

Once the Court determined that the benches were a non-public forum, the next step in the legal analysis required a determination of the reasonableness of the City’s restrictions.

Uptown argued there was no record evidence to support that determination. In response, the Circuit Court recognized that sometimes it’s just intuitively obvious that a government decision is rational, and that no further evidence is required.

In this case, Hollywood was trying to increase its potential revenue stream from the bench ads. The lower court agreed that limiting the advertising space to “more reputable advertisers” was a practical way to achieve that goal.

The Circuit panel agreed:

[W]e find that common sense supports the idea that it is reasonable for the City to limit “less desirable” businesses’ access to bus bench advertising in hopes that the limitation will encourage “more desirable” advertisers.

The court also noted that Uptown had several other advertising options available to reach potential customers. The presence of those other means of building or maintaining their business also supported the reasonableness of the City’s action in this case. Therefore, the panel upheld the lower court’s dismissal of the case.

It might seem a bit odd that a company that ran ads on bus benches for fourteen years would suddenly find itself cut off from that marketing opportunity. On the other hand, Hollywood wanted to spruce up the joint and increase its chances for a better class of advertisers. There was nothing unconstitutional about restricting the kinds of ads that ran on the bus benches, especially when there had always been at least some limits on who could be there. Under the right circumstances, there was also nothing wrong with adding to those restrictions to improve their chances for more money.

It’s just common sense, after all.

July 16, 2003
Coincidence doesn’t prove causation

The Village of Beecher, Illinois prides itself on its atmosphere:

The charm of small town America is alive and well in Beecher, located 37 miles due south of Chicago's Loop. Beecher offers delightful living in neighborhoods of older and newer homes and also in the rural atmosphere of farm properties.

Not everyone feels all warm and fuzzy about the Village government, however.

Roger and Velma Rasche sued Village President Paul Lohmann and the Village, charging that the town retaliated against them for the exercise of their First Amendment rights. The Rasches claimed that just because they spearheaded two successful petition drives to derail two public works proposals favored by the Village, the municipality singled them out for enforcement of Village ordinances.

Nothing like being half-right, I always say.

It’s true that the Rasches took the lead in convincing their fellow villagers to oppose two bond issues—one, to build a village golf course in 1997; the other, to upgrade the village’s water system in 1999.

It’s also true that the Village tried to enforce its sign ordinance against a business sign the Rasches put up in front of their home, headquarters for their vehicle towing operation. These efforts included a series of tickets issued by a code enforcement officer, and an eventual Village Trustees’ vote authorizing the Village Attorney to file a formal state court lawsuit against the Rasches for the alleged sign violations.

The Rasches’ troubles weren’t limited to their signs, either. A Village police officer also issued a separate batch of citations for keeping inoperable vehicles stored in the front yard.

Nonetheless, as it turned out the supporting evidence connecting the enforcement efforts to a concerted retaliatory motive was more than a bit suspect.

By omitting a critical page of pre-trial testimony from their briefs and arguments, for example, the Rasches misstated the facts in claiming Lohmann singled them out for enforcement. As recounted by the District Court and noted by the Seventh Circuit, the deposition transcripts showed the exact opposite:

Plaintiffs rely on Riechers’ deposition where she states that Barber and Lohmann did mention the Rasche sign as one they wanted Riechers to look at. A few lines later, however, Riechers retracted the statement and testified, “Actually I think I’m going to take that back. I assumed this all on my own. I’m thinking about it. No one told me to deal with any particular thing. They just said go to Route 1, and pick out things that you think are in violation.” (Riechers Dep. at 25-26.) (Disappointingly, plaintiffs fail to acknowledge page 26 of Riechers’ deposition testimony.) With no argument addressing the testimony, which fairly read is that Lohmann did not single out the Rasche property, there is no basis to infer retaliation based on this meeting.

The police officer’s actions weren’t aimed solely at the Rasches, either. For example, a nearby transmission service company also picked up 29 citations for keeping vehicles in its front yard.

By the time the attorney filed the Village’s Complaint, moreover, the Rasches were the only business owners who failed to comply with the code enforcement officer’s requests to remove illegal signs or bring them into compliance.

About the only connection between the Rasches’ petition drives and their subsequent legal troubles was a simple matter of timing. In 1997 another Village Trustee named Gary LaGesse was also head of a local recreation association. According to one witness LaGesse threatened retaliation against anyone who fought against the golf course bond issue. In addition, the Village sued the Rasches at about the same time the waterworks bond came up for a vote.

There are limits to using coincidence to prove causation, however:

Although we have noted that a “telling temporal sequence” can be used to establish causation, [citation omitted], we have also recognize … that timing, “standing alone, does not create a genuine issue as to causal connection.” [citation omitted]. A plaintiff must “show more than just temporal proximity.” Id.

… The fact that LaGesse, three years prior to the Trustee’s bringing suit against the Rasches, in his capacity in a recreational association, was upset about losing the golf course does not demonstrate that the entire board of Trustees was motivated to retaliate unconstitutionally by bringing suit against Mr. Rasche for his sign.

In addition, there was no evidence of any connection between the Village lawsuit and any exercise of First Amendment rights:

The Village Administrator’s unrebutted testimony is that he recommended the lawsuit to ensure that the Rasches’ sign was removed only after judicial scrutiny of the proposed action. There was, therefore, abundant evidence that this Board decision was taken in the normal course of its business of pursuing a long-term effort to improve the Village’s appearance by a broad-scale enforcement of its zoning ordinances.

In light of these non-facts, therefore, it was a short step to conclude that the Rasches failed to prove their claims, and that their suit should be dismissed.

From an ethical standpoint, I also think misstating the evidence didn’t help.

July 15, 2003
Bridge burning 101

I read the entire interview of Howell Raines, conducted last week by his self-described friend Charlie Rose.

In some respects, the transcript reflects the usual problems in achieving understanding that are familiar to lawyers in trial practice, which can be summarized as follows:

• It is the rare person who speaks as well as they write. There are fitful starts and false finishes to many sentences. Dead-end rhetorical forays are frequently on display in the middle of a paragraph, as the speaker talks without having the text fully formed prior to its enunciation.

• Sometimes you can tell that the person answering the question clearly didn’t understand it, or is choosing to respond as if he didn’t know what he was asked.

• This transcript did not include as many verbal tics as I have read in others, except for a few that were intelligible (“Uh-hmm” meaning yes, for example.) At times trying to decipher meaning from these non-words is a challenge, unless there is an accompanying visual record to provide the other clues to meaning beyond the spoken language.

Even under these circumstances, however, this was a revealing document, in which a formerly successful American management professional displays some of the traits that led to his departure from his dream job.

As one reads the entire interview, it is obvious that Raines was admittedly untroubled by humility during his tenure. He continues to give the impression that he remains unaware of the potential benefits of that virtue.

Raines continues to deflect acceptance of personal responsibility, while seeming to accept it. He gives every impression that he doesn’t think he’s fully liable, other than in the formal organization sense of being in the head position while others below him not only screwed up, but didn’t tell him about the others who also screwed up.

Here’s are two examples, from the discussion about Jayson Blair.

In the first one, Raines uses an old stand-by:

I stepped on a land mine called Jayson Blair. I became a political liability and that's that story.

When pressed for more details, Raines traveled a different path:

I first learned that Jayson Blair had an accuracy problem on April 30th of this year.

Charlie Rose: When there was an e-mail.

Howell Raines: When there was an e-mail from San Antonio. I was on vacation, Gerald Boyd called me said we had a problem. Gerald and Jim Roberts began investigating it and did so effectively. By the 1st of May, we knew we had a big problem. Jayson had resigned rather than tell us the facts of the case. I came back to the paper on May 2nd, a Friday.… On that date, May 2nd, I sat down and read Jayson Blair's personnel file. For the first time saw that his core problem over a five-year period with ups and downs of success and less success had been a pattern of errors. I first saw at that time the memo that said Jayson Blair has got to quit -- got to be stopped writing for the paper immediately. That memo was addressed to two mid-level editors, addressed to one and copied to another. It never went anywhere else.

Charlie Rose: That's a management problem.

Howell Raines: That's a management problem. At the end of the day since I'm in charge of the management structure the buck stops with me on that. The fact is --

Charlie Rose: You did not know that John Landman said don't let him write for the paper now. Stop it now.

Howell Raines: That's right. No reporter or editor on The New York Times from September 5th, 2001, when I took over the job, to May 2nd when I sat down and read that personnel file, one of 400 reporters personnel files, was I informed verbally or in writing that this person's habitual problem is making mistakes. Obviously it -- if that had been
brought to me, I would have dealt with it. Glenn Kramon who we put in charge of reporting said after the story -- we published the story about it. Glenn said to me personally he could not imagine a memo of that sort being written by someone and not taking it to the executive editor level.

Charlie Rose: Let me make sure. I mean, it seems to me you are suggesting the man who wrote the memo should have brought it to the executive editor that would have been, if he was so concerned about that, something so grievously damaging to The New York Times, it ought to have been brought to the attention of the executive editor. Is that what you're saying?

Howell Raines: No, that's not what I'm saying. I want to say what I'm saying. I'm saying what the person who ran the investigative project said. I'm saying it's a complex place where there are more realities than that. The Siegal committee is looking into that. There are other explanations in a vast bureaucracy someone can write a memo and assume that it's going to be worked through the system in a certain way, or they can -- or they can do what is more commonly done in a situation of this gravity which is to copy it around to make sure that the copy featured on e-mail it goes around.
This memo, for whatever reason, went to two people. There's no evidence that anyone else other than two lawyers in the building who were called in to write a letter of reprimand to Jayson ever saw it. It went into that file on April the 1st, and it rested there until May 2nd of the following year. Now, I assume the Siegal Committee has looked into this. I'm -- you know, I will await their judgments. I want to make it clear to you and your audience and my friends at The New York Times that as I told them at our town hall meeting, the responsibility is mine. Executive editor is responsible for news report and the executive editor is also responsible for the management systems of the paper.

Among the points that are interesting about this segment is Raines’ choice of words. He doesn’t refer to Blair’s plagiarism, but only to Blair’s “mistakes” or problems with "accuracy". In addition, in none of this discussion does he address the additional problem of favoritism. That common organizational predicament could easily explain why some within NYT would hesitate to bring the Blair "problems" directly to Raines’ attention. Telling the boss that one of his star reporters was a fraud could have its own unpleasant consequences, after all.

Raines gave no indication he could even conceive that this might be why he didn't learn about Blair until the situation blew up in spectacular fashion.

If Arthur Sulzberger wanted to feel better about the decision to terminate Raines, then Charlie Rose did him a favor. Rose’s interview seems to have given Raines just enough comfort level to allow him to speak in unguarded tones, and provides a more realistic portrayal of his own self-image than if he were interviewed by, say, Tim Russert.

Sometimes that’s not a good thing.

This transcript could be a useful tool for management classes, both in colleges and in continuing education seminars. Combined with a collection of the relevant documents from the NYT and elsewhere, it can warn others of the dangers of insufficient self-awareness, how ego can cloud one’s judgment, and how the best of intentions can be derailed by the wrong management style.

July 14, 2003
Elle Woods meets Springtime for Hitler

One of my favorite movie scenes is from The Producers. It depicts the initial theater audience reaction during the big "Springtime for Hitler" production number.

It's just a still shot of the totally shocked crowd, but it always makes me laugh whenever I see it.

Last night we went to see Legally Blonde 2.

It produced much the same reaction in our theater as depicted in Springtime for Hitler.

"I'm stunned," said one. "I'm speechless," said another.

I like Reese Witherspoon. I especially enjoyed her role in Election, for example.

This, on the other hand, was simply an awful film.

I didn't think it was possible to be excessively cartoonish yet thunderously earnest about Washington politics at the same time.

I was wrong.

LB2 proves that some stories should stop with the first film, because a sequel is not really possible. The basic concept will only support the initial plot, but those closest to it might not understand that fact, leading to bombs like this one.

What were they thinking?

Were they thinking?

Geez.

July 13, 2003
Nothing like a roller-skating drag queen to spice up your Bingo Games

Last night was a lot of fun, and all for some fine charitable causes to boot.

The Rehoboth Convention Center filled up with hundreds of bingo players for a sometimes raucous, sometimes catty, but universally good-spirited session of Bingo American Style.

The event was part of a series of fund-raisers held throughout the year for the sake of Aids Delaware, Delaware Pride, The Rainbow Chorale of Delaware, and the Metropolitan Community Church of Delaware.

Delaware law permits limited charitable gambling, and this series has been remarkably successful. Several sessions are held each year in Rehoboth and at a fire hall near Wilmington.

The basic admission fee entitled players to a set of 10 sheets of three bingo cards. The more ambitious participants could buy extra sets. Category cards for five special games, such as Fill in the Kite, rounded out the 15 games for the evening.

We bought the daubers and the special game cards, and came close but didn't win any of the many prizes.

The audience was a terrific mix of all kinds of folks, but the event staffers were particularly special.

A group of drag queens hawked 50-50 tickets, double-checked the winners at the tables, and sold special game cards, all while they were decked out in full Red White & Blue costumes.

One queen stood at least 6 foot 4 inches tall before he laced on his skates. His already towering height was then augmented by a bee-hive blond hairdo that rose at least 18 more inches above his head, and which was liberally sprinkled with small American flags.

I don’t know where he found the skimpy blue sequined skating outfit with the tiny flounced skirt, but it fit him perfectly.

And geez, he could skate.

The aisles between the long rows of tables were pretty narrow, but he managed to flow through them with nary a spill or even a close call.

The next bingo session is scheduled for August 23, and the theme is Hurray for Hollywood.

I’ll bet it sells out.