In Corporate Governance after the Financial Crisis, I explained that:
... regulators and some commentators identified executive compensation schemes that focused bank managers on short-term returns to shareholders as a causal factor in the financial crisis of 2007-2008. As we have also seen, shareholder activists long have complained that these schemes provide pay without performance. This was one of the corporate governance flaws Dodd-Frank was intended to address, most notably via say on pay.
The trouble, of course, is that shareholders and society do not have the same goals when it comes to executive pay. Society wants managers to be more risk averse. Shareholders want them to be less risk averse. If say on pay and other shareholder empowerment provisions of Dodd-Frank succeed, manager and shareholder interests will be further aligned, which will encourage the former to undertake higher risks in the search for higher returns to shareholders. Accordingly, as Christopher Bruner aptly observed, “the shareholder-empowerment position appears self-contradictory, essentially amounting to the claim that we must give shareholders more power because managers left to the themselves have excessively focused on the shareholders’ interests.”
Now there's additional evidence that sharehjolder empowerment is dangerous, at least for banks. From Ferreira, Daniel, Kershaw, David, Kirchmaier, Tom and Schuster, Edmund-Philipp, Shareholder Empowerment and Bank Bailouts (November 2, 2012). Available at SSRN: http://ssrn.com/abstract=2170392:
We investigate the hypothesis that shareholder empowerment may have led to more bank bailouts during the recent financial crisis. To test this hypothesis, we propose a management insulation index based on banks’ charter and by-law provisions and on the provisions of the applicable state corporate law that make it difficult for shareholders to oust a firm’s management. Our index is both conceptually and practically different from the existing alternatives. In a sample of US commercial banks, we show that management insulation is a good predictor of bank bailouts: banks in which managers are fully insulated from shareholders are roughly 19 to 26 percentage points less likely to be bailed out. We also find that banks in which the management insulation index was reduced between 2003 and 2006 are more likely to be bailed out. We discuss alternative interpretations of the evidence. The evidence is mostly consistent with the hypothesis that banks in which shareholders were more empowered performed poorly during the crisis.
Somehow, however, I don't expect the apologists for shareholder empowerment to admit their error anymore than I expect the apologists for turning corporate governance over to the SEC to admit theirs.
TSA reportedly exposed breasts of Rep. Ralph Hall’s teen grandniece, called it ‘accidental’; Update: TSA internal report released, blames girl’s ‘loose fitting’ dress
If they'll do it to a relative of a member of Congress, what won't they do to the rest of us?
There is a contingent in the corporate law academy whose preference for federalization of corporate governance leads them to be kneejerk Delaware bashers and SEC apologists. Using the sex scandal aspects of the David Weber case to socre off them woul be cheap (albeit fun). But the allegations of serious misconduct, failure of internal controls, and whistle blower retaliation at the Securities and Exchange Commission are a different story:
Weber’s titillating testimony turns its focus on other executives within the Commission, including the COO and chair Mary Schapiro. Weber’s charges of nepotism and a lack of meaningful internal controls expose the risks that the Commission presented in its daily management of operations and beyond that as well. One does not need to read very hard to understand Weber’s belief that the SEC’s COO utilized a “pay to play” practice. Additionally, in a scene fit for the classic movie Dumb and Dumber, Weber asserts that SEC representatives brought highly sensitive computer code and encryption data to monitor activity on our equity exchanges to a hacker’s conference in Las Vegas. You cannot make this stuff up, folks.
Saving some venom for Ms. Schapiro as well, Weber paints her as a “LIAR” for perjuring herself during a presentation before the House and Senate Oversight Committee regarding the SEC’s bungled attempt to move to new office quarters. Weber would not be the first to label Ms. Schapiro with the big L. Recall that Attorney Richard Greenfield did just the same in the case brought on behalf of Standard Chartered v FINRA, Mary Schapiro et al.
What did Weber receive in return for running these tales of sex, lies, and stupidity up the chain of command? A pink slip, a defamed reputation, and much more. In his defense, Weber points out that an independent investigation by an Inspector General outside of the SEC who looked into charges made against him ultimately cleared him of allegations made against him by those inside the SEC.
If Weber's charges borne out even in part, how will the SEC's apologists be able to credibly continue to insist that the SEC can do a better job of regulating corporate governance than Delaware?
One thing's for sure, the SEC's apologiests won't be able to dismiss this as a one-off event. Not only does Weber's complaint allege pervasive internal controls, his allegations are not the only ones that have been lodged against the SEC.
For example, an April 2012 GAO report found that:
In our audit of SEC’s fiscal years 2011 and 2010 financial statements, we identified four significant deficiencies in internal control as of September 30, 2011. These significant internal control deficiencies represent continuing deficiencies concerning controls over (1) information systems, (2) financial reporting and accounting processes, (3) budgetary resources, and (4) registrant deposits and filing fees. These significant control deficiencies may adversely affect the accuracy and completeness of information used and reported by SEC’s management. ...
We also identified other internal control issues that although not considered material weaknesses or significant control deficiencies, nonetheless warrant SEC management’s attention.
Or, as I observed all the way back in May 2005:
As the SEC continues pressing forward with enforcement of the internal controls provisions of SOX, something very amusing has come to light in a GAO report:
In GAO's opinion, SEC's fiscal year 2004 financial statements were fairly presented in all material respects. However, because of material internal control weaknesses in the areas of recording and reporting disgorgements and penalties, preparing financial statements and related disclosures, and information security, in GAO's opinion, SEC did not maintain effective internal control over financial reporting as of September 30, 2004.
Ouch! Mayhap the SEC needs to get its own house in order first? Or, at least, consult Matthew 7:3-5? It's a serious institutional embarassment for the SEC.
In sum, the current SEC leadership shouldn't be regulating a dog catcher operation, let alone the world's biggest capital markets.
BTW, if the SEC really is one of our finest agencies, as many prominent SEC apologists have claimed, what on earth must be going on at the bad ones? As for me, I'm filing this episode away in my list of reasons why federal agencies should not encroach upon areas of corporate governance traditionally relegated to state regulation.
The SEC is always bitching and moaning about how insider trading undermines "investor confidence in the market place." Of course, it doesn't (see here). But as Wonkette's analysis of the brewing SEC scandal makes plain, the SEC itself may have done vastly more harm to investor confidence in the markets than any inside trader ever did:
Rolling Stone brings us the ewww tale of SEC Inspector General David Kotz (ALLEGEDLY) boning every lawyer (like this pretty lady) with business before the agency, as well as his successor, Noelle Maloney, who then refused to meet with said lawyers because
“DAVID WAS FUCKING THAT LADY!” Until we see pix, it’s no Broadwell-Kelley Tampa Tap-Out. So what else is in this 77 page whistleblower complaint, you might be wondering? Is it all seks and lies and intrigue?
Well, sure there is some! But more hilarious are the accusations of gross malfeasance and incompetence, the likes of which (if true) may be egregious enough to compromise the functioning of Stock Exchange itself (to the degree that it functions right now, of course). No big deal though! ...
SEC examiners assigned to the Division of Trading and Markets performed “penetration testing” of the computer infrastructure of the NYSE, NASDAQ, and all other major exchanges. […]
The information obtained by this ARP examination program is of an extremely sensitive nature. In the wrong hands, this information could be used to disrupt trading activities on all of the exchanges, either individually by exchange, or at all exchanges simultaneously…In the OIG inquiry into the alleged misuse of computer equipment, Weber and his investigators found that the laptops which were used by SEC examiners during these examinations, and on which all the information from the examinations were stored, neither contained virus protection, encryption programs, or firewalls, nor were they ever wiped clean after testing. Some of the computers at issue were used in every stock exchange in the United States, and therefore exposed exchanges to infections or compromises that could be brought from exchange to exchange…
Some of these laptops were brought to foreign countries by SEC management, and by certain SEC management and employees to the “Black Hat” Conference in Las Vegas, Nevada.
Many of these unsecured laptops were probably brought to a hacker convention in Vegas.
The “Black Hat” Conferences are infamous for the illegal activities that occur during the Conferences. In an August 4, 2009, CNN article describing these conferences, the author notes, “[a]t a hacker conference no one is safe.” Indeed, senior IT security personnel at the SEC had acknowledged to Weber as part of the investigation that they were themselves too afraid to attend this Conference.
a. During the 2009 Conference, websites belonging to security researchers were hacked and passwords, private e-mails, and other sensitive documents were released on a vandalized website.
b. During the 2008 Conference, a thumb drive that was passed around by attendees was found to contain a computer virus.
c. During the 2008 Conference, some attendees, themselves security experts, who used the Wi-Fi networks had their passwords “sniffed” and then posted on an electronic bulletin board called the “Wall of Sheep.” One “Wall of Sheep” participant remarked how surprising it was that so many Black Hat attendees were insecure.
d. Also during the 2008 Conference, three French reporters were caught hacking into the press room network.
It’s cool though. No big deal.
When Weber questioned the SEC examiners as to why they would bring their laptops, containing extremely sensitive information, including the architecture and trading engines of the major stock exchanges, to the Black Hat Conference, they replied to the effect that they didn’t “think it was a big deal.”
So what happened, in the end, after this Weber guy became absolutely panicked at the thought of SEC employees or contractors, who may or may not have been given security clearance, taking unsecured laptops to a hacker convention in Vegas filled with foreigners, networking experts, and French reporters? Weber was canned, and forcibly escorted off SEC property.
<SARCASM>It sure fills me with confidence in the SEC and the markets.</SARCASM>
¶1 In his latest book, Corporate Governance After the Financial Crisis, Professor Stephen M. Bainbridge asserts that, in the wake of the significant economic setbacks of the past decade, Congress abandoned its traditional reticence on the matter of corporate governance, yielded to emotionally charged mainstream political demands, and enacted a deeply flawed set of corporate reforms. Specifically, Bainbridge objects to the various corporate governance provisions included in the Sarbanes-Oxley Act of 20021 and in 2010’s Dodd-Frank Act.2 Soundly denouncing both laws, he rejects these purported reforms as “quackery . . . lack[ing] strong empirical or theoretical justification” (p.15) and submits that the offending “provi- sions erode the system of competitive federalism that is the unique genius of American corporate law by displacing state regulation with federal law” (id.).
¶2 A prolific author and blogger and a self-proclaimed “Burkean conservative,”3 Stephen M. Bainbridge serves as the William D. Warren Distinguished Professor of Law at UCLA where he teaches courses on business associations, corporations, and corporate governance. In the past few years, Bainbridge has written several law review articles and books addressing the law and governance of public corporations.4
¶3 In Corporate Governance After the Financial Crisis, Bainbridge argues that Congress blundered badly with both of its recent efforts to regulate in these areas, in each case reacting hastily to a postcrisis atmosphere dominated by anticorpo- rate sentiment and passing legislation that usurps state corporations laws (most critically those of Delaware) and effects federal control over significant aspects of corporate governance. In the late 1990s and early 2000s, the bursting of the dot- com bubble and the massive corporate and accounting fraud uncovered at companies like Enron and Worldcom prompted populist pleas for federal intervention, pleas that soon led to the Sarbanes-Oxley Act. In 2007–08, as the collapse of the housing bubble and the subprime mortgage meltdown were followed in quick succession by the failures of Bear Stearns and Lehman Brothers and the ensuing credit crisis, federal legislators received similar pleas and reacted again, this time with the Dodd-Frank Act. Bainbridge sees a pattern here: “scandals and economic reversals” (p.38)5 regularly mark the aftermath of economic boom times, leading Congress to intervene in corporate governance with reactive bubble laws that are passed quickly under rising political pressures provoked “by populist anti-corpo- rate emotions” (p.16). This cycle, according to Bainbridge, “tends to result in flawed legislation” (id.).
¶4 Bainbridge presents his argument in a straightforward fashion, defending his position chapter by chapter and provision by provision, and he employs a scholarly style well suited for legal and academic audiences with preexisting knowledge of basic corporations law and economic theory. The book’s title, Corporate Governance After the Financial Crisis, however, is something of a misnomer; Bainbridge devotes far more space to detailing the faulty corporate governance provisions in Sarbanes-Oxley than he does to discussing Dodd-Frank, legislation actually passed in response to what is commonly known as “the financial crisis.” (As Bainbridge admits, it may yet be too early to fairly assess the full effects of Dodd-Frank.) Throughout the book, Bainbridge assiduously champions the views of Roberta Romano, a Yale law professor who maintained in a partisan 2005 article that the federal legislative process typically—in the case of Sarbanes-Oxley, specifically—produces “quack corporate governance.”6 Bainbridge specifies in rather redundant terms how both Sarbanes-Oxley and Dodd-Frank meet the cri- teria that define such legislation, but his arguments are less than completely per- suasive, and his persistent allusions to “quack” governance impart a polemical tone to what is otherwise a thoughtful treatise.
¶5 Bainbridge’s analysis of federal legislative responses to economic crises is generally well presented, and his position is bolstered by a variety of academic studies. However, many of Bainbridge’s arguments can be and are countered by authors with similar credentials citing equally credible studies in support of their assertions. Columbia law professor John C. Coffee, who dubs Bainbridge, Romano, and similarly disposed academics the “Tea Party Caucus,”7 suggests in a recent article that even flawed federal legislation is better than nothing and proffers, in direct response to the caucus, that with time and reflection most statutory defects will be corrected.8 With respect to Sarbanes-Oxley, scholars Robert A. Prentice and David B. Spence, both with the University of Texas at Austin’s McCombs School of Business, reject the notion that the act interferes unduly with state authority, argu- ing convincingly that it more accurately represents “a congressional attempt to shore up a federal system of securities regulation that has generally served the nation well.”9 They further assert that the very “empirical evidence that [Sarbanes- Oxley’s] critics believe Congress ignored strongly indicates that vigorous securities regulation is necessary for capital markets to reach their potential.”10
¶6 Ultimately, it is Bainbridge’s evident concern over the “creeping federalization of corporate governance” (p.19) that delineates his position within the wider political context. Federal versus state, reform versus free market, shareholder versus management, main street versus Wall Street—these are the constructs that make up the overarching themes of this book. These topics are also particularly relevant in light of today’s highly divisive political climate, and despite some weaknesses, Cor- porate Governance After the Financial Crisis is a worthy contribution to the debate. It is recommended for academic libraries, particularly those associated with schools of law or business, and to anyone interested in corporate governance practices.
1. Sarbanes-Oxley Act of 2002, Pub.L.No.107-204,116 Stat. 745 (codified as amended in scattered sections of 15 & 18 U.S.C.).
2. Dodd-Frank Wal Street Reform and Consumer Protection Act,Pub.L.No.111-203,124Stat. 1376 (2010) (codified as amended in scattered sections of 7, 12, 15, 18, 22, 31 & 42 U.S.C.).
3. Stephen Bainbridge@ProfBainbridge, Twitter, http://twitter.com/profbainbridge (last visited Aug. 14, 2012).
4. Stephen M. Bainbridge, Response, Director Primacy and Shareholder Disempowerment, 119 hARv. L. Rev. 1735 (2006); Stephen M. Bainbridge, Dodd-Frank: Quack Federal Corporate Governance Round II, 95 Minn. L. Rev. 1779 (2011).
5. Quoting MarkJ.Roe,Washington and Delaware as Corporate Lawmakers, 34DeL.J.Corp.L. 1, 8 (2009).
6. Roberta Romano, The Sarbanes-Oxley Act and the Making of Quack Corporate Governance, 114 Yale L.J. 1521 (2005).
7. John C. Coffee, Jr., The Political Economy of Dodd-Frank: Why Financial Reform Tends to Be Frustrated and Systemic Risk Perpetuated, 97 Cornell L. Rev. 1019, 1024 (2012).
(1) Whereas, the U.S. government is in desperate need of revenue.
(2) Whereas, Warren Buffet is worth tens of billions of dollars, almost all of which is destined for private foundations and thus will completely escape federal tax.
(3) Whereas, Warren Buffet has publicly proclaimed that he is undertaxed.
(4) Resolved, the U.S. government should pass legislation that gifts to foundations in excess of a $20 billion lifetime exemption will hereinafter be taxed at 55%, the normal inheritance tax rate.
Last week, David Weber, a former chief inspector general for the SEC, filed a lawsuit against former employer.
He alleges that several individuals in the SEC retaliated against him for blowing the whistle on sex and corruption at the agency (h/t Rolling Stone).
Weber was investigating allegations that Mary Schapiro perjured herself and lied during on-the-record testimony before the House and Senate Oversight Committees. Schapiro was aware of this before he was put on leave. Putting him on leave at all, actually, could spell trouble for her as well.
Spell trouble is putting it mildly. Unilaterally terminating the IG who is investigating you for perjury before Congress is the sort of thing for which people can do jail time.
Rolling Stone (of all sources) is reporting on a brewing sex scandal at the Securities and Exchange Commission (of all places):
In a salacious 77-page complaint that reads like Penthouse Forum meets The Insider meets the Keystone Kops, one David Weber, the former chief investigator for the SEC Inspector General's office, accuses the SEC of retaliating against Weber for coming forward as a whistleblower. According to this lawsuit, Weber was made a target of intramural intrigues at the agency (which has a history of such retaliation) after he came forward with concerns that his bosses may have been spending more time copulating than they were investigating the SEC. ...
Weber claims that in recent years, while the SEC Inspector General's office has been attempting to investigate the agency's seemingly-negligent responses in such matters as the Bernie Madoff case and the less-well-known (but nearly as disturbing) Stanford Financial Ponzi scandal, two of the IG office's senior officials – former Inspector General David Kotz and his successor, Noelle Maloney – were sleeping together.
Weber also claims that Kotz was also having an affair with a lawyer representing a key group of Stanford victims, a Dr. Gaytri Kachroo. ...
The filing of this lawsuit now by Weber officially begins the raging clusterfuck portion of the story, as he and his lawyers are releasing lurid details not only about Kotz and Maloney, but about a host of other SEC and SEC IG officials. ...
There are, for instance, allegations that officials handed out SEC contracts to buddies at influential Beltway consulting firms, claims that sexual harassment cases were covered up and accusations that the SEC failed to properly screen contractors who were given full access to SEC databases (it cites an example of one contractor who was on early parole from a 10-year narcotics bid in Virginia). The suit also alleges that the SEC security chief, William Fagan, "watched the video feed from security cameras outside of the [Inspector General's] suite, in order to determine the identities of . . . potential whistleblowers."
Perhaps most crazily, however, the suit alleges major security violations. ...
If half this stuff is half true, an agency that long had the repurtation for being one fo the best in Washington (admittedly not a lot of competition) is going to take a serious black eye. I've got to run to class, but I'll have more thoughts later on the obvious issues of internal controls.
The Greenhouse Effect is a term coined by Hoover Institution economist Thomas Sowell and popularized by D.C. Court of Appeals Senior Judge Laurence Silberman in a speech to The Federalist Society in 1992. In this speech, Silberman used the term to postulate a tendency of conservative Supreme Court Justices to vote with the liberals more often as their careers progress due to a desire for favorable press coverage. He said "It seems that the primary objective of The Times's legal reporters is to put activist heat on recently appointed Supreme Court justices." ... The Greenhouse Effect refers to Linda Greenhouse, a Pulitzer Prize winning New York Times Supreme Court reporter for over three decades, currently a Senior Fellow at Yale Law School.
... none of his colleagues can compete with the media acclaim cascading over Chief Justice John Roberts after his solo decision upholding the Affordable Care Act this June. The editors of Esquire have included Chief Justice Roberts in their December "Americans of the Year" issue, praising his "nimbleness." After the Citizens Uniteddecision on free speech and political spending, he found a way "to save the court's credibility."
Chief Justice Roberts shares the Esquire honor with Lena Dunham, the star of an Obama campaign ad and the creator and star of the HBO series about 20-something sexual angst called "Girls."
She and the Chief Justice also make the Atlantic Monthly's list of "Brave Thinkers" of 2012, by which they mean thinkers who agree with the Atlantic's liberal editors. Ms. Dunham is praised for taking "the soft glow off the 'chick flick,'" for instance when her character acts "like an underage street hooker to turn her boyfriend on," while the Chief Justice gets credit for "maintaining the Court's legitimacy" with a ruling "both brave and shrewd." President Obama probably has Time's "Person of the Year" nailed down, but expect the Chief to finish a close second.
One wonders if one is observing the Greenhousing of the CJ.
The Omnibus Revenue Reconciliation Bill of 1993, H.R. 2264, 103d Cong., 1st Sess. (1993) imposed a 10% surtax on any annual salary in excess of $250,000 and prohibited publicly held corporations from deducting executive compensation in excess of $1 million per annum unrelated to performance. Promoting passage of the legislation, President Clinton stated that “the tax code should no longer subsidize excessive pay of chief executives and other high executives.” David E. Rosenbaum, Business Leaders Urged by Clinton to Back Tax Plan , N.Y. Times , Feb. 12, 1993, at A1. Interestingly, however, the bill was carefully crafted to protect the Friends of Bill in Hollywood and other blue state elite enclaves:
It somehow caught our eye that Barbra Streisand will pick up $20 million for two days' work at the MGM Grand Casino in Las Vegas. We've never objected to anyone collecting what the market thinks she or he is worth, but we do recall that Ms. Streisand is a certified Friend of Bill. And we somehow doubt this will provoke a denunciation of "greed" of the sort the President and his wife have leveled at doctors, insurers and drug manufacturers. Indeed, Ms. Streisand and similarly situated FOBs enjoy a privileged position under the new tax code Mr. Clinton has imposed as penance for the Greed Decade.
Certainly $20 million in loot qualifies her as "rich," and thus she'll be called upon to pay her "fair share." But at least MGM Grand Inc. gets to deduct her compensation as an ordinary business expense, taking her $20 million off its gross receipts before paying taxes on whatever net is left. That's presumably because in the moral universe of the Clinton tax code, warbling tunes for Vegas high rollers qualifies as work of redeeming social value.
For certain more suspect lines of employment, pay can no longer be deducted as an ordinary cost of business, at least if over a year it adds up to 1/20th of what Ms. Streisand takes for a couple hours of work. MGM Grand can deduct whatever it decides to pay her, but it can't deduct more than $1 million of whatever it pays its top five executives.
As it happens, these folks don't make anything like what Ms. Streisand does. President and CEO Bob Maxey has base pay of $525,000 a year, and Chairman Fred Benninger gets $610,000. You could argue that it's different because they set their own salaries, but they don't. They report to a board dominated by majority shareholder Kirk Kerkorian, not known as a blushing-violet negotiator.
What Mr. Clinton's tax law really means is that Mr. Kerkorian can be more generous with Ms. Streisand than with Mr. Maxey or Mr. Benninger. Or if you turn it around with a few envelope-back calculations, Ms. Streisand gets a lower true tax rate on what Mr. Kerkorian has to shell out. ...
We're not sure we understand the morality here. What we do understand is that a lot of Hollywood celebrities, and far fewer chief executives, are certifiable FOBs.
The FOB Loophole, Wall St. J., Oct. 14, 1993, at A16.
So why not extend the nondeductibility of non-incentive compensation over $1,000,000 to all forms of compensation, including that of Hollywood Friends of Bill and Barak? After all, to paraphrase Bill, why the tax code any longer subsidize excessive pay of actors and the like?
The California Republican Party is functionally dead. And how is California doing, now that liberals have successfully terminated the state's remaining conservatives?
For starters, it's still in debt. Despite Brown's historic tax hike, the California Legislative Analyst's Office announced this week that the state still faces a $2 billion budget deficit just for the next fiscal year. California's liberal electorate has already racked up an additional $370 billion in state and local debt over that last decade. That is more than 20 percent of the state's gross domestic product.
According to the California State Budget Crisis Task Force, that comes to more than $10,000 in debt for every Californian. And because the state's credit rating is so low, California taxpayers must fork over about $2 for every new dollar borrowed. In 2012 alone, the state budget included more than $7.5 billion in debt service -- more than most states' budgets.
Don't think for a second that California's chronic deficits are caused by low taxes. Even before last Tuesday's tax hikes, California had the most progressive income tax system in the nation, with seven brackets, and the second-highest top marginal rate. Now it has the nation's highest top marginal rate and the nation's highest sales tax. And the budget still isn't balanced.
The real cause for California's fiscal crisis is simple: They spend too much money. Between 1996 and 2012, the state's population grew by just 15 percent, but spending more than doubled, from $45.4 billion to $92.5 billion (in 2005 constant dollars).
What are Californians getting for all this government spending? According to a new census report released Friday, almost one-quarter, 23.5 percent, of all Californians are in poverty. One-third of all the nation's welfare recipients live in the state, despite the fact that California has only one-eighth of the country's population. That's four times as many as the next-highest welfare population, which is New York. Meanwhile, California eighth-graders finished ahead of only Mississippi and District of Columbia students on reading and math test scores in 2011.
Middle-class families that want actual jobs, not welfare, are fleeing California in droves. According to IRS data compiled by the Manhattan Institute, since 2000, almost 2 million Americans have left California for other states. Their most popular destination: Texas.
If I were a business man instead of a law professer, Texas would look pretty good to me too. But I keep hoping against my better judgment that the California Democrat establishment will come to its senses before the state turns into Greece.