Fausta's Blog

American and Latin American Politics, Society, and Culture

By

SCOTUS upholds Obamacare subsidies

Hardly surprising,

Add one to the Capt. Louis Renault file:

My out of pocket under Obamacare is close to $10,000. Anyone supporting this can all go to h*** as far as I’m concerned.

In another decision, lawyers stand to make a bundle, Supreme Court Upholds Tool for Fighting Housing BiasOutcome means fair-housing lawsuits can proceed without proof of intentional discrimination

UPDATE
Allahpundit expected the Obamacare decision, too: “It was already here to stay no matter how the Court ruled today.”

Share

By

Argentina: Cristina can’t pay up . . .

So she keeps looking for a settlement:
As posted earlier, the SCOTUS not only ruled that Argentina can’t make payments on its restructured debt unless it also pays the holdouts, but also that the creditors can get access to a wide number of bank records to locate financial assets overseas that they might be able to seize as compensation.

Cristina Fernandez gave a speech about “vulture funds”, and came up with this (emphasis added),
Argentina Wants to Settle With Holdout Creditors
Argentine President Cristina Kirchner said her government wants to reach a settlement with a small group of creditors suing to collect on defaulted debt, but only if U.S. courts create the right conditions for talks.

Let me translate this into plain English: Cristina’s saying that she’ll not abide by the terms of the contract upheld by the SCOTUS, but instead that she’ll agree to pay less when U.S. courts abide by Argentinian law, which is exactly what she’s been saying all along.

In her annual Flag Day speech, Mrs. Kirchner said Argentina would enter talks with the help of U.S. courts. “We only ask they create negotiating conditions that are just and in accordance with the Argentine constitution, laws and contracts we signed with 92.4% of our creditors,” Mrs. Kirchner said, referring to investors who accepted the restructured bonds.

There are fools out there who saw this as being conciliatory, and

The country’s restructured bonds jumped during Mrs. Kirchner’s speech on Friday, nearly wiping out their losses for the week.

These same fools probably bought some Ecuadorian bonds, too.

high apple pie
In the sky hopes

Inimical to Cristina’s thinking, the fact is that

Humiliating as that may be to the Argentinas of the world, no one would lend them money without contractually guaranteed recourse to a venue where the rule of law is well established.

Axel Kicillof, the economy minister,

dismissed the options of full payment or outright default as unthinkable. He said that the government would attempt to reroute its exchanged bonds from New York to Argentina, away from the reach of the United States’ courts. That would allow Argentina to continue paying the creditors it struck deals with in 2005 and 2010, without paying the holdouts.

“Transferring the bonds to local law would be very difficult at the street level,” warns Henry Weisburg at Shearman & Sterling, a law firm. First Argentina must convince a majority of holders of the exchanged bonds to agree to the swap. This task may be insurmountable given that many of the current creditors are bound by rules restricting them from holding assets under foreign jurisdiction.

Carrion trade
Even if Argentina were to succeed in persuading holders of the exchanged bonds to take the plunge, any intermediary that helped facilitate the rerouting risks being held in contempt of the New York courts. Argentina would thus need to find an intermediary that is not, and has no desire to be, subject to New York law. Lastly, Argentina would need to convince Bank of New York Mellon, its current trustee, to release information about the bondholders to its new intermediary. That could put the bank into contempt; it has already said it “will comply with any court order by which it is deemed bound.”

The Hedge Funds Aren’t Crying for Argentina, but they’d be wise to hold off the celebration until they actually get paid:

The offer to negotiate comes less than two weeks before Argentina has to make the next interest payment on its restructured bonds, which U.S. courts have said the country isn’t allowed to pay unless it also pays the holdout creditors. If Argentina misses the interest payment on June 30, the country sinks into technical default and will have another 30-day grace period to avoid an outright default.

In other LatAm debt stories, Guatemalan bonds are looking bad, too.

Sing it, guys,


Share

By

Argentina: SCOTUS didn’t take the case . . . yet

Not surprisingly, the Supreme Court of the United States is not adding Republic of Argentina v. NML Capital Ltd., the defaulted bonds case, to their current docket:
Supreme Court Takes No Action on Argentina Bond Case
Appeal Isn’t Added to Docket; Justices Could Still Take Up Case Later

If the high court follows past practices, the justices may ask the U.S. Solicitor General to submit a brief expressing the Obama administration’s views on whether the court should hear the case. That process could take months. The Supreme Court has taken that approach in past cases stemming from Argentina’s economic crisis.

The court also could choose to reject Argentina’s appeal, especially because parts of the case are still pending in a New York federal appeals court. Argentina would be able to file a new petition to the Supreme Court when that case is finalized in the lower court.

In related litigation, the appeals court in New York. In August issued another ruling, upholding a lower court’s order that Argentina pay $1.33 billion to the holdouts. The court stayed its decision pending Supreme Court review. Argentina also has asked the appeals court to reconsider its decision.

Bottom line: anyone invisting on Argentinian bonds at this point may be credulous enough to buy into the Nicaraguan Canal.


Share

By

The wasted 1-day summit

In case you missed it, yesterday a summit took place between the three largest economies of North America: Canada, Mexico, and the USA. You would think this would be news as of itself, since it involves membership on the Trans-Pacific Partnership (TPP) free-trade zone.

Instead, Obama diverted the press conference into the issue of Obamacare and the SCOTUS, by cautioning the justices, to whom he referred to as “an unelected group of people,”

“I’m confident that the Supreme Court will not take what would be an unprecedented, extraordinary step of overturning a law that was passed by a strong majority of a democratically elected Congress,”

Video:

This was an attack on the court’s standing and even its integrity in a backhanded way

It is outrageous enough that the president’s protest was inaccurate. What in the world is he talking about when he asserts the law was passed by “a strong majority of a democratically elected Congress”? The Patient Protection and Affordable Health Care Act barely squeaked through the Congress. In the Senate it escaped a filibuster by but a hair. The vote was so tight in the house — 219 to 212 — that the leadership went through byzantine maneuvers to get the measure to the president’s desk. No Republicans voted for it when it came up in the House, and the drive to repeal the measure began the day after Mr. Obama signed the measure.

It is the aspersions the President cast on the Supreme Court, though, that take the cake. We speak of the libel about the court being an “unelected group of people” who might “somehow overturn a duly constituted and passed law.” This libel was dealt with more than two centuries ago in the newspaper column known as 78 Federalist and written by Alexander Hamilton. It is the essay in which Hamilton, a big proponent of federal power, famously described the Court as “the weakest of the three departments of power.” It argued that the people could never be endangered by the court — so long as the judiciary “remains truly distinct from both the legislature and the Executive.”

It was precisely the separation of the courts from the other two branches, Hamilton argued, that gives the court its legitimacy.

With his statement, President Obama Goes on Record Opposing Marbury v. Madison.

Q&O:

it isn’t the job of the Supreme Court to do the job of Congress. Instead, its job is to determine whether or not what Congress has done is compliant with the limits the Constitution places on it. That’s it. There is nothing which requires the Supreme Court to “fix” laws that Congress has passed.

Ruth Marcus:

Obama’s assault on “an unelected group of people” stopped me cold. Because, as the former constitutional law professor certainly understands, it is the essence of our governmental system to vest in the court the ultimate power to decide the meaning of the constitution. Even if, as the president said, it means overturning “a duly constituted and passed law.”

So the joint press conference with Felipe Calderón and Stephen Harper accomplished…what?
1. Obama’s going after the Supreme Court as his bête noire, knowing they cannot respond.

2. It showed that the President needs a remedial course in judicial review.

and,
3. It demonstrated to Mexico and Canada that they are mere side ornaments when it comes to Obama’s priorities: Critical issues that involve the three countries count for nothing.

Why is the TPP critical now?

Canadian officials have said that they have been willing to put everything up for negotiation—including, some officials say, dairy products and other issues such as a U.S. push for Canada to increase intellectual-property protections.

TPP joins a list of recent points of tension in the world’s largest trade relationship. Canadians were angered by “Buy America” provisions in last year’s U.S. stimulus plan, new surcharges imposed on Canadians traveling to the U.S. and regulatory delays in approval for the Keystone pipeline, a massive project to move crude from the oil sands of Alberta to U.S. refineries.

But hey, after his next election Obama will have more flexibility.

As a side note,
When you read the full transcript, note the condescending tone towards Calderón (“Felipe, Stephen and I are proud to welcome you here today”).

UPDATE,
Don’t miss Judidical activism for me, but not for thee


Share

By

Non-judge Elena Kagan to the Supreme Court

President Obama has nominated a lawyer with no judicial experience to the Supreme Court:
NBC: Obama to name Kagan for high court
1st female solicitor general served as White House adviser under Clinton

Kagan would be the first justice without judicial experience in almost 40 years. All of the three other finalists she beat out for the job are federal appeals court judges, and all nine of the current justices served on the federal bench before being elevated. The last two justices who had not been judges, William Rehnquist and Lewis Powell, joined the Supreme Court in 1972.

William Jacobsen finds a supreme irony in the nomination: Supreme Irony – Kagan Nomination Ends Gay Marriage Hopes

But on one issue of critical importance to the left — the constitutional right to same-sex marriage, Kagan has staked out a very clear and unequivocal position: There is no constitutional right to same-sex marriage.

In the course of her nomination for Solicitor General, Kagan filled out questionnaires on a variety of issues. While she bobbed and weaved on many issues, with standard invocations of the need to follow precedent and enforce presumptively valid statutes, on the issue of same-sex marriage Kagan was unequivocal.
…
This doesn’t mean that Kagan opposes gay marriage. But she clearly believes it is a matter for the political process, not a constitutional right.

While it is not clear what view the other Justices have, it is likely that a Kagan on the Court will put an end to any ultimate chance of success in the federal lawsuit lawsuit filed by David Boies and Ted Olson to have California Prop. 8 declared unconstitutional.

Reasonably assuming the four conservative judges share Kagan’s view, there now will be a definite majority on the Court against recognizing a constitutional right to gay marriage.

The Washington Post touts her lack of judicial experiece, saying Elena Kagan never let lack of experience hold her back. Hail the SCOTUS bureaucrat:

“She knows government, and she knows how to run institutions.”

UPDATE
SCOTUS blog has 9750 Words on Elena Kagan
More than you ever wanted to know, via TigerHawk

——————————————-

I must meet a deadline this morning, therefore there will be no podcast today. Thank you for your support.

Share