From: riggs@descartes.tec.army.mil (Bill Riggs)
Newsgroups: misc.legal,talk.politics.misc
Subject: Re: More of the House Bank "scandal"  (was Pardon stuff...)
Date: 21 Jan 93 23:23:23 GMT
Followup-To: misc.legal,talk.politics.misc
Organization: LNK Corporation, Riverdale, MD

In article <1993Jan16.053243.29097@Princeton.EDU> niepornt@phoenix.Princeton.EDU (David Marc Nieporent) writes:
>In<1993Jan15.142426@IASTATE.EDU> dickw@IASTATE.EDU (Richard Wallingford) writes:
>>William December Starr <wdstarr@athena.mit.edu> writes:
>
>>>All I can say here is "Get real."  As long as the House Bank maintained
>>>a positive bottom line -- and I've heard no allegations that it ever
>>>went into the red -- then the only money that flowed out of it to cover
>>>"kited" checks was money that had already been deposited into it by
>>>other House Bank members... money which they had _already_ received in
>>>the form of paychecks for work _already_ done.
>
>>Now I get it!
>
>No, you obviously don't.
>
>>The congressional bank is a "good" bank and *my* local bank is a "bad" bank.
>
>Personally, I think the congressional "bank" is a really bad bank, since
>it didn't even pay interest on deposits.

	This would only be a sensible statement if an inherent function
of a bank is to pay interest on (checking/draft) deposits. Given the House
Bank's sloppy management practices, such a procedure would have been 
impossible. But on the face of it, characterizing a bank as "good" or "bad"
based on whether it pays interest on liquid deposits is nonsense.

>
>>You see, at my bank, when I write a bad check, they could cover it
>>with other peoples' money because they've  got lots of assets.
>>They charge me an extra $30 to cover it.  I wonder why they don't 
>>just pay the overdraft and forget about it just like the House Bank.
>
>Many banks offer overdraft protection, and they don't charge $30 per
>check.  You should find a new bank.

	Time was when MOST banks didn't even offer overdraft protection at
all. But times have changed, and you really do need it now to keep the
"check clearing genie" from robbing you blind. I'll bet the $30 a check 
bank takes two days longer to clear its deposits than it takes to get
paid "over the wire".

>
>>My friend's bank is even worse. They completely refuse to pay it.
>>My friend is then subject to arrest by the police for "Fraudulent use
>>of a Financial Instrument (namely a check) and "theft".  
>
>So?  He should get a different bank, then.

	Clearly there are lots of "mean banks" out there that don't have
the advantage of being run with the taxpayers' money. We should not forget
that the House Bank was a "not-for-profit" institution. If Mister Nieporent
gets his way, that will be the fate of virtually every bank in America.

>
>>Why can't my bank be like the House Bank?  I want a "good" bank;
>>one which takes care of my screw-ups!
>
>You want one which doesn't pay interest?  How stupid.

	Once again, the time value of money was in no way, shape, or
form, a part of the House Bank's accounting system.

>
>>Maybe I should join a credit union where everyone is a big happy
>>family and shares their money like the House bank.  Wait. They
>>don't cover your ass for fraud either.
>
>>Dang! I guess the only solution is to run for conress.

	Question: Who OWNS the House Bank ?

	a. The members of the House of Representatives

	b. The people of the United States of America.

>
>Where's the fraud?  If you and me and Mr. Starr get together and agree
>to pool our funds, are you telling me that's fraud?  As long as we've
>agreed in advance to cover each other's deposits, there's something
>wrong with that?  Really?  If so, we need to rewrite that fraud law.

	Let's put it this way:

	You and Mr. Starr outvote Mr. Wallingford in your corporation, and
agree that Starr will appoint the bank manager, who will report to Starr.
It becomes public knowledge that Mr. Starr's appointed manager has called 
Wallingford 13 times on the $100 he has been arrears to the bank for
the past month, but has called you only 3 times for the $6000 you have 
owed the bank over the last 6 months. Would this be fraud ? Perhaps not,
but clearly such practices violate simple fairness, to say nothing of
giving your corporation a poor reputation. Is this against the law ?
It strikes me that it is fanciful to make it crime to lie to a congressman
in the performance of one's doing, but that it is somehow okay to steal
"the time value of money" from a congressman, if he is in the minority.
If you don't beleive me, check Congressman Riley's (Kansas) record in the
midnight debate last year on the House Bank.


>
>>>Whether that was moral or kosher depends upon to what extent you believe
>>>that high-level public servants should be given such perks in order to
>>>allow them to spend more of their time and effort on their public
>>>service rather than on the minutiae of running their private lives.
>
>>Now we get to the crux of the matter.  The upshot of this whole fiasco
>>is that congress has demonstrated that they are unwilling and/or
>>unable to properly manage money.  Why on earth should they be conscientious
>>and careful about how they spend the taxpayers' money if they're not
>>held accountable in their personal finances?
>
>They demonstrated no such thing.  They managed money fine.  Now, if
>their colleagues who *didn't* overdraw their accounts wanted to
>complain, fine, since they subsidized the overdrawers, but that's different.
>
>The "bank" had a policy, which they knew about and took advantage of. 
>How is that irresponsible?

	This is simply untrue. The House Bank did NOT have a policy, because:

	1. The Sergeant at Arms's office dealt directly with overdrafts,
	and was completely negligent in ensuring that individual congressmen
	paid off the overdrafts in a reasonable length of time.

	2. The bank statements issued by the House Bank were frequently
	in error and out of date when issued to the members. A good many
	members of the House apparently made what they thought to be
	honest statements to the effect that they owed the House Bank
	nothing when the scandal initially came to light,(based on their
	last statement from the Sergeant at Arms' office) but found 
	themselves on the bad check list (the initial list approved for release
	did NOT include the amount owed).
						
	3. It took a major operation by the House Leadership JUST TO find
	out who the major check kiters were. Politics being what it is, it 
	is only understandable that there was some backdoor maneuvering over
	the lists, but if we are to believe the statements of the select
	committee members during the debate, things were a mess, and they 
	had a devil of a time getting accurate figures from the Sergeant at 
	Arms office.

>
>-- 
>David M. Nieporent   | "We don't need anymore [sic] wretched refuse.  It's 
>niepornt@phoenix.    |  time to send the Statue of Liberty somewhere else"
>   princeton.edu     |      -- Jack "Not a bigot" Schmidling, 1/7/93
>Baltimore Orioles 93 |

	This is not just partisanship; it is petty partisanship.

	Refer to line 8 of the .sig.


Bill R.

--

"When up a dangerous faction starts,         "My opinions do not represent
With wrath and vengeance in their hearts;     those of my employer or
By solemn League and Cov'nant bound,          any government agency."
To ruin, slaughter, and confound;             - Bill Riggs (1992)
To turn religion to a fable,
And turn the Government to a Babel;
Pervert the law, disgrace the gown,
Corrupt the senate, rob the crown;
To sacrifice old England's glory,
And make her infamous in story.
When such a tempest shook the land,
How could unguarded virtue stand ?"
- Jonathan Swift (1732)
Newsgroups: misc.legal,alt.politics.usa.constitution