Wednesday, May 17, 2017

Mandatory Binding Arbitration is a Cancer on the US Legal System

Mandatory arbitration clauses are undermining consumer protections, civil rights, and employment laws that level the playing field between big businesses and individuals.
Mandatory Arbitration cartoon by Jen Sorensen
http://jensorensen.com/
It's time to end mandatory binding arbitration. Companies force consumers to give up their right to use the legal system to resolve disputes by embedding language in contracts that say in the event of any dispute, both parties have to go to an arbitration firm. 

Here’s an example of a standard arbitration clause in use at Amazon:

any dispute or claim relating in any way to your use of any Amazon Service, or to any products or services sold or distributed by Amazon or through Amazon.com will be resolved by binding arbitration, rather than in court.

Arbitration clauses are usually outlined in tiny print, buried in lengthy documents and written in legalese that is incomprehensible to most people. Moreover, these clauses are mandatory, meaning that people are compelled to agree to arbitration even before a dispute arises. Because entire industries are inserting these arbitration terms into contracts, there is usually little choice but to agree to them. In other words, “consent” is not voluntary, at all.

One does not simply turn down arbitration


Over the last few years, it has become increasingly difficult to apply for a credit card, use a cellphone, get cable or Internet service, or shop online without agreeing to private arbitration. The same applies to getting a job, seeing a medical specialist, buying or renting a car, or placing a relative in a nursing home. 

Arbitrators are not required to have any legal training and they need not follow the law. Court rules of evidence and procedure, which tend to neutralize imbalances between the parties in court, do not apply. There is limited discovery making it much more difficult for individuals to have access to important documents that may help their claim. Arbitration proceedings are secretive. There is no right to public access. Arbitrators do not write or publish detailed written opinions, so no legal precedent or rules for future conduct can be established. Their decisions are still enforceable with the full weight of the law even though they may be legally incorrect.

Arbitration providers are organized to serve businesses, not consumers. Their marketing is targeted entirely at businesses, and their panels of arbitrators consist primarily of corporate executives and their lawyers. Since only businesses will be repeat users of an arbitrator, there is a disincentive for an arbitrator to rule in favor of a consumer or employee if he expects further business

The top 10 most used arbitration firms only found in favor of the consumer less than 2% of the time, so it's no wonder they are popular with corporations who contract with consumers, but not so much with corporations who contract with other corporations.

In 2002, car dealers actually lobbied Congress to get binding arbitration clauses banned in their contracts with auto manufacturers. The dealers were asking Congress for an exemption at the same time they were adding binding arbitration clauses to sales contracts with their customers and claiming it was for everyone's benefit.

Arbitration is neither fast nor cheap

Comparisons of average awards by arbitrators and courts in employment cases and medical malpractice cases show that even in the rare cases where arbitrators decide to award damages, arbitration claimants receive only about 20 percent of the damages that they would have received by going to court.

In 2015, employees of Guitar Center were ordered to sign a mandatory arbitration agreement or lose their jobs. The agreement forced employees to give up their rights to sue the company in class action lawsuits if they believe there has been discrimination, or in the case of wage violations and unjustified terminations, and other types of disputes.

Today, nearly every arbitration clause prohibits participation in class action lawsuits. By banning class actions, companies have essentially disabled consumer challenges to practices like predatory lending, wage theft and discrimination. The Supreme Court has repeatedly upheld the use of binding arbitration clauses — even in situations where mounting a case is so expensive that a class action would be the only financially feasible way hold a company accountable.

A study of 4,000 arbitration cases found that employees complaining of on-the-job discrimination won only about 21 percent of the time. In court, they win discrimination suits 50 to 60 percent of the time, other studies show, and receive damage awards that are five times higher, on average. 

Don't sign arbitration agreements

The folks at Public Citizen keep a Forced Arbitration Rogues Gallery on their website.  These corporations put “forced arbitration” clauses in their terms of service to block consumers from holding them accountable in court. If consumers (or employees) are hurt or ripped off by these companies, they must take their claims to private, secretive tribunals that favor the companies.

A 2007 report by Public Citizen found that over a four-year period, arbitrators ruled in favor of banks and credit card companies 94% of the time in disputes with California consumers.

Consumer contracts with Amazon, Netflix, Travelocity, eBay and DirecTV now contain arbitration clauses. Sprint, a company with more than 57 million subscribers, faced only six arbitrations between 2010 and 2014. 

While some companies also include an opt-out provision on arbitration — typically between 30 and 45 days — few consumers take advantage of it because they do not realize they have signed a clause to begin with, or do not understand its consequences.  

A 2000 Washington Post survey of cases involving First USA Bank, then the nation's second largest credit card company, revealed that arbitrators ruled for the bank 99.6 percent of the time. In 2007, a Public Citizen report revealed that one giant firm, the National Arbitration Forum, hired out its private adjudicators to hear some 34,000 consumer-versus-bank cases in California during the previous four years, and they ruled for the financial giants 95 percent of the time. Even more incredible, the City of San Francisco discovered in a 2008 lawsuit that of 18,045 cases brought by the financial powers against overwhelmed California consumers, NAF's private judges sided with the corporations 100 percent of the time.
Arbitration clauses are common, especially for products and services that low-income families use

A Consumer Financial Protection Bureau report found that 75% of consumers surveyed did not know if they were subject to an arbitration clause in their credit card contract. And among consumers whose contract included an arbitration clause, fewer than 7% recognized that they could not sue their credit card issuer in court.  Roughly two-thirds of consumers contesting credit card fraud, fees or costly loans received no monetary awards in arbitration.

A 2000 study of forced arbitration in HMO contracts found that on the rare occasion that an arbitrator made a significant award for a patient, the HMO never hired that person to arbitrate a case again.

The most direct way to address mandatory arbitration would be for Congress to amend the Federal Arbitration Act to exempt consumer and employment arbitration, or to provide more protection for consumer and employee rights in arbitration. Whereas state-level legislative action to this effect would almost certainly be preempted by the FAA, legislation passed by Congress would encounter no such problem.

The most prominent effort to deal with mandatory arbitration at the federal level has been the proposed Arbitration Fairness Act (AFA). Although there have been various versions of the statute, the most recent version would amend the FAA to specify that “…no predispute arbitration agreement shall be valid or enforceable if it requires arbitration of an employment dispute, consumer dispute, antitrust dispute, or civil rights dispute.”


If enacted, the AFA would effectively eliminate all mandatory arbitration in the employment or consumer realms, as well as in antitrust and civil rights cases. In its statement of congressional findings, the proposed AFA specifically refers to the problems of employees and consumers having little effective choice about entering mandatory arbitration agreements, the deleterious effect on the development of public law, and the lack of judicial review.


The Arbitration Fairness Act has been repeatedly introduced in Congress, with versions proposed in 2009, 2011, 2013 and 2015. Most recently, the AFA was again proposed in 2017 in the Senate by Sen. Al Franken, D-Minn. (S.537) and in the House by Rep. Henry Johnson D-GA (H.R.1374).  However, neither bill has been up for a vote and given the current Congress, the bills are unlikely to ever make it out of committee.




Just Say No! to mandatory arbitration


While we are waiting for Congress to do its job, there are some things you can do to protect yourself:

1. Read contracts thoroughly to see if they contain a mandatory arbitration clause.

2. Opt out of mandatory arbitration if you can. There may be a time limit to opt out, so don't delay.

3. If you cannot opt out and cannot find an alternate company to do business with, write on the contract: "I object to this mandatory arbitration clause, but am signing this contract because I am told I have no choice." Initial the statement.

4. If you receive a notice from a credit card company or insurance company notifying you of changes to your contract, read it carefully.


5. Don’t be afraid to speak up! If you find an arbitration clause objectionable for any reason, make your feelings known to company management. There may be a possibility to negotiate if the company wants your business, or you as an employee badly enough.

6. Contact your representatives in Congress and demand action on the Arbitration Fairness Act of 2017.

Fair Arbitration Now logo


For more information, visit: http://www.fairarbitrationnow.org/

Monday, April 17, 2017

Facebook censorship is both arbitrary and capricious

 Facebook Censors don't owe you an explanation

Despite insisting it is not a media company and is not in the business of making editorial judgments, Facebook is all too happy to censor user-generated content. Facebook censors operate under a cloak of anonymity, with no accountability to users.

Facebook Auto Censorship

Have you ever tried to post a comment and got a message saying, "Unable to post comment - try again?" 
Facebook - unable to post comment error

Or  "An error occurred. Please Try again in a few minutes"?


Facebook - an error occured - try again
And no matter how long you wait, you keep getting the same error?  

Have you ever had a Facebook post rejected because of an "unsafe link"?

Facebook - blocked link
The link could be a web page or an image that Facebook decides is "unsafe."  

Have you ever had a Facebook post rejected because Facebook decided your comment "seems irrelevant or inappropriate"?
Facebook - comment block


The primary way Facebook flags and takes down content is via automated algorithms. As with any automated system examining content, there will always be false positives; innocent text or images that trigger the censor. The problem is that Facebook censors too much innocent content and makes it impossible to reach a human in order to appeal their decision. 

So if you see, "If you think you are seeing this by mistake, please let us know" keep in mind that no matter what you write, no human will read it and reconsider. It's just a way to make YOU feel better about their censorship. 

Facebook Censorship by Trolls 

Have you ever been notified by Facebook that one of your posts has been removed?  
Facebook - We removed something you posted


Have you ever been notified by Facebook that you have been "Blocked From Posting?" 

Facebook - Temporary ban

Then chances are your post "triggered" somebody who decided to retaliate by reporting you for violating "Facebook Community Standards"

With more than 1.7 billion people using the social network every month, Facebook can't monitor everything that passes through its site. The company does have teams of people around the globe devoted to policing Facebook, but those teams largely rely on its community of users to call out questionable behavior. 

Facebook employees are completely overwhelmed by complaints from users, their guidelines for making determinations are murky at best and they have very little time in which to evaluate the validity of individual complaints. As a result, their default response is almost always to remove comments and suspend the commenters. 

When users are suspended or have their content removed, there is often little explanation and they're left to figure out the reason why for themselves.

And the reporting system is ripe for abuse by cyber bullies. Not only can they maneuver you into posting a keyword they can then report you for, or go searching through your posts to find something innocuous that contains a keyword out of context, but they can gang up on their victims, reporting innocent comments often enough until the system sides with the reporter or a human reviewer makes an assumption in their favor. 

Even mentioning someone else’s name in a post means that, if the comment is reported it can be viewed as violating community standards. Which is particularly ironic, since clicking on a "Reply" link below someone's comment causes the system to print their name on the reply before your answer. Other folks routinely use the individual’s name out of courtesy when replying. The name recognition is automated to the point that the person doing the reporting of abuse need only have an account with the same name or partial name as the name mentioned in the comment in order to report it as some kind of "personal attack" for purposes of silencing an opponent.

Facebook's policies enable bullies to target other users for harassment by falsely reporting their photos, their posts, or their account with impunity. The victim gets punished, and the abuser walks away consequence-free.

As often as not, one of the victim's so-called "friends" is the one doing the reporting and there is no way for the victim to discover who this person is in order to unfriend them and stop the harassment, nor is there any recourse for them. If they attempt to contact Facebook about the issue, they are ignored and sometimes even banned. They are simply helpless and at the mercy of a severely flawed system.

The entire system is so unpredictable and inconsistent, it’s difficult to determine how to censor yourself when you are being targeted by cyber bullies. The temporary bans just keep getting longer and longer, with no way to defend yourself against the onslaught until you stop posting completely or are permanently banned.

Facebook - Permanent Ban

Facebook trolls delight in reporting people they do not like for trumped-up violations that often result in removal of individual posts or entire accounts. This is a very common practice, especially in political circles. If someone doesn't like you, or the comments you post, they can report you for spam or some other reason and tell their friends to do the same. The automatic systems will take your content down and send you a warning. If the complaints about you continue, Facebook will block you from posting and eventually they will disable your account. How long that takes and how many complaints it takes seems to vary quite a bit.

There is no channel of communication a victim of this cyber bullying can use to defend themselves. Targets have to wait out their bans and then retreat from the places where they were being victimized. In this manner, more than any other, Facebook fails to defend its users against cyber bullying. 


Two days after suggesting that the United States reallocate portions of its military budget towards healthcare and education, God instantly felt the wrath of Facebook. The post received such a massive, vitriolic response, algorithms automatically banned God for 30 days. 

Facebook - trolls censor God account

"God" had no option but to wait it out. The "God" account frequently draws the ire of Facebook users who either view the profile as blasphemous to their religion or disparaging of their country because God often criticizes American imperialism. This suspension over what amounts to an uncomfortable truth delivered as satire is an example of Facebook's increasingly oppressive censorship.
 
False DMCA Claims

Because Facebook does not validate the identity of anyone submitting a DMCA takedown notice, nor does it check to see if the report was sent from a legitimate email address, anyone with an ax to grind can fill out a form with a bogus copyright complaint to get a Facebook page removed.

It's no wonder why Facebook is so quick to censor content some find objectionable and to remove potentially copyrighted material. It costs money to evaluate complaints. It's much easier and cheaper to ban first and ignore the victim's response, satisfying the complainer and at the same time giving a time out to someone others have identified as a trouble-maker.

The chilling effect these unfair actions have on free speech and debate can be very frustrating, but it can also be devastating for people who rely on Facebook to promote their business or to interact with their customers. 

Spock - Live long and don't be an asshat!


Ode to Reporting Asshats:
 

Here I sit in front of my screen
Looking for posts that I find mean
Oh my, is that a pic of a tit?
I must hurry up and report that shit
It's not my fault that I'm a desperate loner
Or that sexy pics give me a boner
In my ass, I carry a big stick
That turns me into a whiny, little prick
I'll always be here, watching your page
Acting like 12 instead of my age
I act like a friendly, happy fan
But I'm really hoping to get you a ban

I usually go by the name of troll
But also answer to the name asshole

Saturday, April 1, 2017

EERE - The Office of Energy Efficiency and Renewable Energy


Wapo article about EERE
https://www.washingtonpost.com/news/energy-environment/wp/2017/03/31/its-our-central-hub-for-clean-energy-science-trump-wants-to-cut-it-massively/?utm_term=.434a45acb93c

Sounds bad, but I'm not sure these cuts are all that terrible. And despite the headline, the proof that they "helped make solar power affordable" is non-existent. American-made solar panels generally cost from 80¢ to $1 per watt (W) – about 10-30¢ more per watt than imported panels. And where do most of the panels installed in the US come from? China, of course.

So, the prices on installed systems have come down because of innovations in manufacturing made by China and resulting competition from China. We are already way behind.


Beyond that, any innovations that might arise from US government-sponsored research will go directly to US manufacturers. Will they ever pass the savings on to consumers without the competition from China forcing them to do so? Not likely.


So, what have we been getting for our investment so far? I don't see anything practical -- and I looked. 


While taxpayer-funded researchers are trying to make solar more affordable, many states run by Republicans and business interests are doing everything they can to make it less affordable. They protect the power companies (and those who supply the fuels they use to generate power) through eliminating or sharply reducing net-metering payments for electricity generated. 


Some states will soon require you to sell all electricity generated by your panels to the power company for next to nothing and then buy all your power at a premium from them. That's called "buy all; sell all" and many other states will adopt it after the first few get away with it. Florida, looking ahead to the impact of future improvements in battery storage technology is already requiring a connection to the grid to make a house "habitable" even if you have enough storage capacity so that you don't need a connection to the grid. In other words, Republicans are busy making solar much less affordable for homeowners by dramatically increasing, if not completely eliminating the pay-back time.


Why invest a lot in alternative energy research, when Republicans are already busy screwing Americans out of the benefits of existing technology and eliminating the EPA? If they could charge us for the air we need to breathe, they would. Fix the politics first, and the rest will follow.

Thursday, March 9, 2017

The "Trump Rally"

The Trump Rally

The above image currently making the rounds on Right-wing web sites is a lie because the market has been going up consistently since 2009. Trump hasn't caused a rebound, so the arrow shouldn't be going down before it goes up. However it is true that there has been a Trump bounce. 

Any new president can cause a stock market rally by announcing sharp increases in military and infrastructure spending, tax cuts, cuts to entitlements, reducing regulation of business and cutting health and safety regulations. That's like eating a candy bar for breakfast and thinking you'll be fine till lunchtime.

Republicans like to point to former President Reagan's economic policies to prove that "supply-side" economics, aka "trickle down" economics works. Reagan cut taxes and increased government spending by 2.5% a year. These actions caused the Federal debt to almost triple. It grew from $997 billion in 1981 to $2.85 trillion in 1989. And most of the new spending went to defense, so it amounted to a jobs program for highly-paid defense contractors and manufacturers

Trickle-down economics

Trickle-down supply-side economics has always favored corporations and wealthy individuals, while doing almost nothing to create jobs or raise blue-collar workers’ incomes. Trump's economic plans are no different. According to the non-partisan Tax Policy Center, almost half of the benefits from Trump’s proposed tax cuts would go to the top 1% of income earners. 

A Stock Market Rally on Life Support

Stock valuations have climbed to high levels because the Trump rally has been fueled by expectations of tax cuts and other stimulus, not fundamental improvements in corporate profits. The market’s price-to-earnings ratio hasn’t been this high since the dot-com-bubble. The S&P 500 has gone more than 100 consecutive days without a 1% decline, the longest streak since 1995, according to Goldman Sachs. The S&P is also 9 percent higher than its 200-day average, often a signal that a correction is ahead.

To keep his rally going, Trump will have to deliver on his promises. But paying for the promised tax cuts, plus increases in defense and infrastructure spending would have to be approved by Tea Party Republicans and they are in no mood to negotiate with free-spending Republicans.
 

The U.S. is expected to exceed the debt limit on March 16. If the ceiling isn’t raised, it could trigger a default and a global crisis. Government funding also expires on April 28, which means Republicans will have to agree on some kind of measure to avoid a shutdown. Such an agreement would also have to be blessed by more conservative Republicans who are adamantly against further increases in the national debt for any reason.

“Wall Street is totally misreading Washington,” David Stockman, former O.M.B. director under Ronald Reagan, has said. “It's pricing in a fantasy about a Trump stimulus that simply isn't going to happen. There will be no tax cut, there will be no 15 or 20 dollar a share reduction in the corporate rate.” 

According to the National Bureau of Economic Research, the average post-World War II expansion cycle lasts less than five years. It's been 7 years without an official recession and we are overdue for the next downturn, the first signs of which should be a rally killer, and the longer we have to wait for it the worse it'll be.



Life cycle of a stock market rally
The life-cycle of a stock market bubble

Restrictions on trade by the Trump administration could trigger other countries to retaliate and lead to lower profits for U.S. companies that depend on customers and suppliers around the world. Trump's protectionist policies could even result in China replacing the U.S. as the main trading partner for other nations.

Perhaps the most glaring risk that markets have discounted is Trump’s own unpredictability. He is a walking embodiment of unacceptable risk, and not just in economics. His inability to control his Twitter rants and his frequent policy shifts are unnerving investors. There’s nothing Wall Street hates worse than uncertainty — and Trump is nothing if not unpredictable. 

The current irrational exuberance in the stock market has been fueled by the mistaken belief that Trump will implement only the “good” part of his campaign promises (tax cuts, deregulation, infrastructure building), while refraining from pursuing the “bad” promises (trade wars, import tariffs, unraveling multilateral agreements). This wishful thinking will soon collide with reality and the markets will take a deep dive. As always, those who can least afford it will be the ones who suffer the most; and ironically many of those same folks voted for Trump.

Trump supporters cartoon