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Archive for February 16th, 2013

“Law is order in liberty; and without order, liberty is social chaos.”

-Archbishop Ireland

If you decide to move to another country and live within its laws you don’t express a disregard of the essence of its culture.  It’s a form of aggression.” 

-V.S. Naipaul

“Whatever government is not a government of laws, is a despotism, let it be called what it may.” 

-Daniel Webster

Tyrants have always some slight shade of virtue; they support the laws before they destroy them.”

-Voltaire

“If the president does it, that means it’s not illegal.”

-Richard M. Nixon

“This is something I’ve struggled with throughout my presidency.  The problem is that I’m the president of the United States, I’m not the emperor of the United States. My job is to execute laws that are passed.”

  -Barack Hussein Obama

“The sovereign is called a tyrant who knows no laws but his caprice.” 

-Voltaire

“If we resort to lawlessness, the only thing we can hope for is civil war, untold bloodshed, and the end of our dreams.” 

-Archie Lee Moore

Barack Obama has long uttered self-congratulatory rhetoric about his administration being “Historic” and “Unprecedented”, which for the most part is true, but not for the reasons he likes to feel good about while taking one of his historic and unprecedented number of lavish vacations on our dime.  Never has an administration ever been more contemptuous of the law as this one.

Article II, Section 3 of the Constitution requires of the President that ” he shall take Care that the Laws be faithfully executed,”, and yet this self-styled “Constitutional Scholar” has failed to exercise a basic and fundamental duty of the President as assigned by law.

31 U.S.C. 1105 (a) states:

On or after the first Monday in January but not later than the first Monday in February of each year, the President shall submit a budget of the United States Government for the following fiscal year. Each budget shall include a budget message and summary and supporting information. The President shall include in each budget the following:

The law has required the President to submit a budget since The Budget and Accounting Act of 1921, which might raise the possibility that this law is somehow racist, but seeing as how we did not have a black President until the election of William Jefferson Clinton in 1992, I think we can safely discount this possibility, and Obama’s many apologists will have to find a different excuse for his failure to perform this legal requirement of office all but one year of his tenure.

I find his failure to do so somewhat puzzling, as he lamented how the Constitution operates as “a charter of negative liberties” that constrains the federal government, rather than empowers it. (How the fact that this is a feature and not a bug has managed to evade such a distinguished Constitutional scholar surely is a mystery for the ages, along with how he has so far managed to not recognize that the Declaration of Independence was the charter, and that the Constitution was the bylaws.  Maybe he was too busy with his duties leading the Harvard Law Review to pay attention that semester.)  Surely for someone who bristles as much as he appears to at the idea of what he is not permitted to do, the thought of being able to propose and submit a budget would be a remarkable opportunity.  Alas, this is obviously not the case.  Apparently budgets are for little presidents…the ones who don’t promise “fundamental change”.

However, this is not an end to President Obama’s casual disregard for the law (or at least the ones he doesn’t like).  His administration’s role in the GM and Chrysler bankruptcies lead to events which flipped the bird to long-standing bankruptcy law, and destroyed longstanding principles underlying secured transactions and principles of commercial credit.

But it wasn’t long before these hopes were dashed by the government’s management of the process. Instead of a regular bankruptcy proceeding, the Obama administration, working with the automakers, patched together a process without precedent — a bankruptcy combined with a bailout, incorporating the worst elements of both.

Of the two proceedings, Chrysler’s was clearly the more egregious. In the years leading up to the economic crisis, Chrysler had been unable to acquire routine financing and so had been forced to turn to so-called secured debt in order to fund its operations. Secured debt takes first priority in payment; it is also typically preserved during bankruptcy under what is referred to as the “absolute priority” rule — since the lender of secured debt offers a loan to a troubled borrower only because he is guaranteed first repayment when the loan is up. In the Chrysler case, however, creditors who held the company’s secured bonds were steamrolled into accepting 29 cents on the dollar for their loans. Meanwhile, the underfunded pension plans of the United Auto Workers — unsecured creditors, but possessed of better political connections — received more than 40 cents on the dollar.

Moreover, in a typical bankruptcy case in which a secured creditor is not paid in full, he is entitled to a “deficiency claim” — the terms of which keep the bankrupt company liable for a portion of the unpaid debt. In both the Chrysler and GM bankruptcies, however, no deficiency claims were awarded to the wronged creditors. Were bankruptcy experts to comb through American history, they would be hard-pressed to identify any bankruptcy case with similar terms.

To make matters worse, both bankruptcies were orchestrated as so-called “section 363″ sales. This meant that essentially all the assets of “old Chrysler” were sold to “new Chrysler” (and “old GM” to “new GM”), and were pushed through in a rush. These sales violated the longstanding bankruptcy principle that an asset sale should not be functionally equivalent to a plan of re-organization for an entire company — what bankruptcy lawyers call a “sub rosa plan.” The reason is that the re-organization process offers all creditors the right to vote on the proposed plan as well as a chance to offer competing re-organization plans, while an asset sale can be carried out without such a vote.

But this was not the end of The President’s disrespect of the law.  He also took it upon himself to disregard the notion of separation of powers and determine for himself when the Senate was in recess, so he could appoint, without their certain rejection, appointees that would not be consented to by the Senate.

Article II, Section 2 of the Constitution states:

He shall have Power, by and with the Advice and Consent of the Senate, to make Treaties, provided two thirds of the Senators present concur; and he shall nominate, and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other public Ministers and Consuls, Judges of the supreme Court, and all other Officers of the United States, whose Appointments are not herein otherwise provided for, and which shall be established by Law: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments.

The President shall have Power to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.

This specifically does not give the President the right to determine when the Senate is in recess, as each house, and each house alone, is responsible for determining the rules of its proceedings, as set forth in Article I, Section 5 of the Constitution.

Each House shall be the Judge of the Elections, Returns and Qualifications of its own Members, and a Majority of each shall constitute a Quorum to do Business; but a smaller number may adjourn from day to day, and may be authorized to compel the Attendance of absent Members, in such Manner, and under such Penalties as each House may provide.

Yet the President felt compelled to take it upon himself to determine that the Senate was in recess, despite the Senate assertions otherwise, so as to effect appointments of officials without the Senate’s advice and consent.  First in the case of Richard Cordray, to lead his new Consumer Financial Protection Bureau, and then Sharon Block and Richard Griffin to the National Labor Relations Board.  While Obama apologists propose that it was the Senate violating the Constitution by conducting pro-forma sessions, that appeared to have no other purpose other than blocking the President’s ability to make recess appointments, the fact remains that the Constitution unequivocally gives the Senate the authority to make its own rules.

Each House may determine the Rules of its Proceedings, punish its Members for disorderly Behavior, and, with the Concurrence of two-thirds, expel a Member.

This means that the President did not have any lawful remedy to his complaint other than a resort to the Courts, for a ruling on whether or not the Senate’s actions comported with the Constitution. (And it is quite likely that the courts would have deferred to the Senate’s judgement by finding the action to be in the nature of a “political question”, which until Bush v. Gore, the courts have long decided by not making any decision whatsoever.) Once again, the President is the one who acted in an unlawful manner…a concept clearly not driven home to the administration, based on this ludicrous assertion by Administration Spokesclown Jay Carney:

Carney insisted the ruling was narrow to “one case, one company, one court.”

Carney attends Teh Peepuls Skool of Law N Stuf, which makes him uniquely qualified to state this rather remarkable assertion. At least I hope so, because his Wiki bio states that he has a B.A. in Russian and Eastern European Studies from Yale University.  I find it interesting that his boss is not as certain, as he has quietly resubmitted two of the not-recess appointed official’s names for confirmation by the Senate.

Sadly, this is not the full extent of this administration’s lawlessness, which will be demonstrated in Part II.

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