Skip to content

Ponzi, updated

I admit that I have never been able to understand cryptocurrency. The idea that one can create value by wasting electricity and/or solving mathematical problems that no one cares about escapes me. Even an NFT is at least a sort of a thing, which one gets in exchange for one’s money, though I find it hard to believe that a bunch of pixels, always really in someone else’s possession, can be worth millions of dollars.

But here’s a newer scam that I think I do understand a bit more. I once had a case involving a Ponzi scheme where, thanks to our ability to get to a windfall to the fraudster (he won the lottery and made the mistake of letting them put his grinning face on the front page of the papers) we were able to get some money back for the folks he defrauded. Like the scheme I’m about to discuss, the deal he offered was too good to be true, but if you got in early…

So here’s the latest twist on the Ponzi scheme: the “move to earn” game. Participants are being paid to walk. Not to any particular place, nor to any particular person, nor for any particular reason other than personal health, perhaps. No one gets anything of value in exchange for the cryptocurrency in which the walkers are paid:

The typical move-to-earn game works similarly to Axie Infinity: A new user buys into the game with an initial investment, which can range from under \(100 to \)3,000. In return, the user gets an NFT —a digital shoe in Stepn’s case—that grants them the ability to start making money. When they exercise, the user is able to earn some of the company’s signature token (in Stepn, that’s GST, for Green Satoshi Tokens) but only for a set amount of time per day (say, 10 minutes). 

Players can cash out, but the game provides an incentive not to do so: They can often earn more money per day if they reinvest the money back into the system, for example, by paying to upgrade their NFT shoes or buying more of them—again, these shoes are not real—which allows them to earn for more minutes every day. The NFT shoes then become investments in and of themselves, able to be sold (or even leased) to the highest bidder. Stepn makes money from all this activity by pocketing a tax on in-app activities, including NFT trading and minting rentals. 

The full article to which I’ve linked gets into the weeds, but the bottom line is that nothing of value is created within the process. The only money that comes in is paid by the walkers in the form of entrance fees and the other fees discussed in the quote above. It is then paid back in return for walking, with the fraudsters taking a cut. It doesn’t take much thought to realize that it can only work if new people keep coming in to increase the supply of money to be paid to those who came before.

The fraudsters insist that it’s not a Ponzi scheme and that they are taking steps to prevent the inevitable, but it seems pretty clear that at most they will delay the inevitable. The particular scheme on which the linked article focuses is already showing signs of collapse. Apparently there are a number of these “move to earn” sites out there. In the Ponzi scheme case in which I was involved, to which I alluded above, the fraudster ended up in jail after we put him through involuntary bankruptcy. It would seem that the DOJ should be taking a good hard look at these scammers, but I suppose when you’re working on prosecuting traitors for sedition, simple fraud may have to take a back seat.

Just as an addendum, there is apparently fraud on both sides. Some folks have found a way to make the game think that they’ve walked, when they’re actually just sitting back collecting their cryptocurrency.

Schadenfreude of the day

Try as I might (and I’m not really trying), I can’t seem to dredge up any sympathy for the folks who got conned by Madison Cawthorn and his friend’s Let’s Go Brandon (LGB) cryptocurrency scam.

Seems the “value” of the currency went way up shortly after Cawthorn endorsed it at the end of last year, after which he cashed out for a quarter of a million really dollars, after which the value went down to zero:

Cawthorn saw his investment in the coin increase by upward of a staggering 97% during the 10-day period he held the coin, according to LGB’s market data.??>“This looks like a pretty classic ‘pump and dump’ scheme,” said Jordan Libowitz, a spokesman for Citizens for Responsibility and Ethics in Washington.

LGB’s market value suffered a precipitous decline beginning just one day after Cawthorn offloaded upward of \(250,000 of the coin onto the market. The coin’s troubles compounded on Jan. 4 after NASCAR rejected the coin’s sponsorship deal with Brown. By the end of January, the market cap of the meme coin dropped all the way to \)0. ?Trumpers practically advertise themselves as targets for scam artists, inasmuch as they”ve been scammed by Trump, Fox, and the Republican Party for years.

Now, all this doesn’t mean that I wouldn’t want to see Madison prosecuted for this little bit of insider trading. Now, he might try a they deserved to get conned defense, which has some emotional if not legal merit, and it just might work if he got a jury full of people sick to death of Trump and his antics, but I wouldn’t count on that. Any such jury would also be more than happy to see Madison wheeled off to jail.

Yet another modest proposal

We read in this morning’s New York Times that the state of Texas has (and other states with fascist legislatures soon will) made it illegal for a corporation to decline to do business with gun makers and other merchants of death. In another era, this blatantly unconstitutional interference in interstate commerce would be considered…umm…I know!: Blatantly unconstitutional! In this era it should also be considered unconstitutional if one applies the unconstitutional ruling in Citizens United, since if a) corporations are entitled to all the rights of actual human beings (and then some, actually), and b) investing money in politicians is a form of speech with which the government is barred from interfering by the First Amendment, then it only makes sense that the Texas statute is unconstitutional since a) corporations are entitled to all the rights of human beings, and 2) investing money is a form of speech with which the government is barred from interfering by the First Amendment.

However, we can probably count on the present Supreme Court telling us that Texas is not at all interfering with interstate commerce, and as to Free Speech, well, spending money is only speech when it’s spent to buy politicians, particularly Republican, politicians.

So, I’ve no doubt that Gavin Newsom will (and I hope Ned Lamont will follow his lead) anticipate my modest proposal by proposing legislation in California that duplicates the Texas law, except that it would penalize corporations for doing precisely what Texas requires of them.

Alas, I am confident Brett and his pals can find a way to let Texas have its way while deploring the blatant unconstitutionality of California’s law. Still, it’s worth the effort if only to further undermine the public’s faith in an institution that has now abandoned all pretense of impartiality or actual belief in the rule of law.

More Republican Election fraud—What a Surprise!

This is truly unbelievable. Well, in this day and age not unbelievable, but it should be, being yet another example of Republicans committing the crimes that they accuse Democrats of committing:

Five candidates vying for the right to challenge Michigan Gov. Gretchen Whitmer (D) are facing the possibility of being eliminated even before the primary election after a state board found their campaigns filed thousands of fraudulent signatures.

Michigan’s Bureau of Elections issued a formal recommendation late Monday that the five candidates — including two leading contenders — be removed from the August primary ballot. The recommendation will go before the four-member Board of State Canvassers, a bipartisan panel made up of two Democrats and two Republicans, who meet on Thursday.

It goes without saying that all five are Republicans. The candidates are trying to blame the folks who uncovered the fraud and the people they paid to gather the signatures. Funny how whenever you read about actual voter fraud, there’s a Republican involved.

George pleads guilty

It seems W has unwittingly pled guilty to being a war criminal:

Former President George W. Bush on Wednesday inadvertently condemned “the decision of one man to launch a wholly unjustified and brutal invasion of Iraq” as he delivered remarks criticizing Russia’s assault on Ukraine.

This got me thinking about a post I wrote at the end of February, in which I observed that there was no meaningful distinction between what Bush did and what Putin did. In looking through my archives, I realized that for reasons I can’t reconstruct, I never posted it. So here it is. I wrote it on the 28th of February, when it would have been more timely, but what the heck, now that George has acknowledged its truth, I might as well put it up:

The international criminal court is considering charges against Putin for war crimes and crimes against humanity. He is no doubt guilty of those things, but let us pause.

Back in law school some of the professors would note that some legal arguments, made by judges or by lawyers, amounted to distinctions without a difference. That is, they attempted to amplify an irrelevant fact into a sufficient reason to decide that controlling precedent or clear statutory language did not apply to the case at issue.

I would submit that anyone who would argue that there is any meaningful distinction between what Putin is doing in Ukraine, and what Bush did in Iraq, would need to rely on this type of argument. Both invaded countries that posed no threat to them based on rationales that were based on lies, which even, had they been true, would not have justified the actions they took. It really is as simple as that. Perhaps the only distinction, which I would argue is not a legitimate difference, is that Bush managed to get a majority of the United States Congress to pretend to believe his lies and endorse his misadventure. So far as I know, Putin felt no need to get his rubber stamp legislature to do as our Congress did.

Neither one will ever actually face a trial before the International Court, but it’s impossible to argue that only one deserves to be indicted. America is lucky that few countries have raised this issue in response to our push for sanctions.

After I wrote the above, I stumbled across this in which we learn that our actions in Iraq were different in some way:

Some of the things that we did in the nineteenth century or in the 1970s or out of our anger and grief after 9/11 were bad, okay, but they aren’t the same. They were another era with different rules, different motivations, different moralities and different levels of social and political maturity.

The fact is that, confining ourselves just to the Iraq situation, the situations are pretty much the same. We attacked a sovereign nation without any actual provocation. That shouldn’t stop us from doing what we can to stop Putin, but as is the case with our other crimes against humanity, (e.g., slavery and genocide of Native Americans) it’s important that we acknowledge our history and learn from it.

One must conclude from Bush’s inadvertent admission, that somewhere in the depths of his disordered brain, he realizes the extent of his guilt. Perhaps he’ll consider turning himself in to the International Criminal Court and invite Vlad to join him.

The rule of law continues to crumble

The courts, well stocked with right wing nutjobs, particularly in the Confederacy, seem to be competing with each other to see who can make the most outlandish decisions, discarding not only years of precedence, but basic legal principles that even a child could understand.

The latest example (See also) is a decision from the 5th Circuit upholding a Texas law that:

 makes it illegal for any social media platform with 50 million or more US monthly users to “block, ban, remove, deplatform, demonetize, de-boost, restrict, deny equal access or visibility to, or otherwise discriminate against expression.

Of course the law provides the now commonplace ability for those offended by being “blocked, banned”, etc., to bring lawsuits seeking to enforce their right to be provided a platform from which to spew their vitriol, with the statute framed in such a way as to make it impossible for the social media platform to prevail.

I used to think that I could perform an occasional service on this blog by explaining some of the finer points of the law, but this one is too obvious. The First Amendment forbids the government from interfering in speech. It does not give each person the right to demand a platform from private parties. This law is so blatantly unconstitutional it’s hard to count all the ways in which it transgresses. There’s the fact that a state is impermissibly interfering with interstate commerce. There’s the fact that the state is requiring a publisher to publish things it prefers not to publish, which turns free speech on its head.

The 5th Circuit, taking a lesson from the Supremes, took this action without issuing a decision. Maybe the challenge of overturning mountains of precedent seemed like too much, so why bother. Far easier to issue a 15 word ruling simply setting the lower court’s legally correct ruling aside.

One irony of all this is that even rightwing judges don’t appear smart enough to see that a ruling such as this could come back to haunt them. From what I’ve seen, it’s far easier to get banned from Twitter if you’re on the left than on the right, and, consistent with the rule that if they accuse the left of something, they are in fact doing it themselves, it’s folks on the right who get all outraged by being dissed by folks on the left, who, assuming the law is fairly applied will be able to turn the law against the right. Oh, wait, I forgot that the courts will surely find a way to construe it so it only protects right wing speech.

Just a few years ago I would have written that “even this Supreme Court would never uphold this decision”, but now I’m stuck with saying that there’s a better than even chance they’ll find a way to do so. It won’t make any sense, but Alito’s recently leaked opinion proves beyond doubt that making sense is no longer a priority among the extremists on the court.

Chapter Infinity in IOKYAR

You really truly couldn’t make this stuff up, this being just a quick update of it’s okay if you’re a Republican.

It’s okay to commit voter fraud if you’re a Republican. Seems like one Billy Lanzilottie, a “23-year-old GOP operative, South Philadelphia ward leader, and chairman of the Republican Registration Coalition” arranged to have more than three dozen mail ballot applications sent to a PO Box he controlled. Of course, it was all on the up and up because:

…Aiming “to help pump out the Republican voter turnout,” he said, he began going door-to-door earlier this month and signing up residents of the 26th to vote by mail.

He’d hand them a form on which he or people he works with had already filled out the voter’s name and his P.O. Box as the destination, he said. Having the ballots sent there was a “convenience to the voter,” he said, so it could be hand-delivered to them later by someone they trusted.

“There’s been a number of problems with the post office lately,” he said. ”Checks are being stolen out of the mail. They like it this way because I’m someone they trust.”

Except:

But many of the voters said they don’t know who Lanzilotti is and had no idea he was submitting mail ballot applications in their names.

Sure sounds a lot like what they accuse Democrats of doing, doesn’t it?

Also, Republicans also appear to feel that it’s okay to hold an elected position even if you just murdered your wife:

A Lebanon [Indiana] man accused of killing his wife in March and dumping her body in a creek is among the candidates to advance in a local election after Indiana’s primaries Tuesday. …

The 40-year-old has been incarcerated in the Boone County Jail since March after police said he told investigators he threw a concrete flower pot at his wife, Nikki Wilhoite, the night before and dropped her body over the side of a bridge.

Well, I suppose at least he’s honest, given the fact that he confessed.

More on the post Roe world

Since my post of a few days ago I’ve read a lot of speculation about which precedents the court will destroy next. Most of the speculation is sound, but some should give one pause, if one believed that the right wing members of the court have even a shred of intellectual honesty. For instance, a blogger at Above the Law speculates that New York Times v. Sullivan may be overruled:

As for remaking First Amendment jurisprudence, well, the notoriously thin-skinned Donald Trump campaigned on the idea he would “open up” libel laws. And he isn’t a one off — no, both Justices Thomas and Gorsuch have invited the Court to revisit Sullivan. Do we really think Alito, Kavanaugh, and Barrett will hold the line here? Sure, some academics still have faith that the core of the actual malice standard will remain intact, but I’m not so certain.

The Sullivan case required that a plaintiff prove actual malice when asserting a libel case against the press.

It strikes me that if the “justices” decide to do this, they will have some heavy lifting to do when they have to explain why the new rule applies to the New York Times and MSNBC, but not to Fox, which by any reasonable measure would suffer the most from such a ruling. I suppose they could always go with the rationale of the lower court judge who ruled that Tucker Carlson could not be sued for libel because no reasonable person would ever believe anything he said, that rationale of course ignoring the fact that it’s the unreasonable people that we have to worry about. The whole thing might pain Roberts a bit, as he has this thing about the court’s reputation, but he’s not even the swing vote anymore, so he’ll have no choice but to go along.

The article at Above the Law is well worth reading. It also argues that Brown v. Board of Education may be on the chopping block. I wonder what Ginni will say to Clarence to get him to stay in step with the movement and vote to overturn Brown.

Where we may go after Roe goes down

Yesterday we learned (no need to link, everyone knows about it by now) that the Supreme Court is planning to reverse Roe v. Wade. It’s actually a bit of a surprise to me, as I expected that they would simply gradually chip away at it until it was all but overruled, but never expressly so.

Before I go on, a hat tip to the person who leaked the draft opinion, since there can be no question but that we would not otherwise have learned about this until after the election, which is when those judges who insist the court is absolutely non-partisan, would have released it, lest they hurt Republican chances in the mid terms.

I imagine I won’t be the first to make the following predictions, but I’ve purposely avoided reading commentary on the decision until after I post this, so I can honestly say these were my initial thoughts, unprovoked by pundits of the right or left.

I think the future course of American law on reproductive issues is an “and/or” proposition. The right will agitate for, and the court will, unless the Democrats get their act together:

  1. Overrule Griswold v. Connecticut, and leave it to the states whether women can have access to birth control. We’ve already seen the beginning of this movement among politicians cultivating the Trumpists. And no, I will not digress into an irrelevant discourse about the probability that Trump himself has likely paid for a good number of abortions as well as encouraging his sex partners to use birth control. Oh, wait I did digress. Anyway, whatever rationale the court is using to overrule Roe (I haven’t read the opinion) will of necessity also provide support for overruling Griswold. Needless to say, such a decision would not be particularly popular with the majority of people in this country, but the court is, in other areas, doing its best to make sure the will of the majority has no bearing on who gets elected or what laws get enacted. So, that’s one thing we’ll be hearing about.
  2. The other half of the “and/or” will require some pretzel logic by the court, as I do know, despite having not read it, that the draft opinion states that the question of abortion should be left to the states. The problem is that some states will not only opt to keep it legal, they will likely make it easy for out of staters to obtain abortions. And, of course, from the point of view of the anti-abortion establishment, every sperm is sacred, so allowing any abortions at all cannot be tolerated. So, we’ll see lawsuits brought seeking to nullify the right to abortion in such states by declaring a fetus a person from the moment of conception, and all abortions murder. This will require some fancy footwork on the part of Amy and her pals, as there would be all kinds of precedents they’d have to ignore, but don’t put it past them.

Life is full of ironies. We likely wouldn’t be faced with this possible future if Ruth Bader Ginsburg, a fierce defender of abortion rights, had done the right thing and retired while Obama had a Senate majority.

It is to be hoped that the Democrats can, at least, capitalize on this development by making it a part of their campaign, not only be attacking the reversal of Roe, but by warning that the soon the Republicans will be coming after your birth control pills. They say they will, but we’ll see.

UPDATE: Having now gotten my predictions out, I have perused my preferred sources of punditry. Here’s a good accounting of the horrors to which we can now look forward.

The F-Word makes an appearance

It has been apparent for some time that the Republican Party is dominated by people who prefer fascism to democracy. Trump has been fairly up front about it. However, the media has been reluctant (is that the right word, or is “terrified” a better choice?) to drop the F-word in connection with the Republican Party.

So it was sort of refreshing to see that this obvious reality was acknowledged recently on Morning Joe, which I don’t watch because 1) I don’t have a TV, and 2) even if I did, I can’t stomach the bullshit, the occasional intrusion of reality notwithstanding.

Joe and his guest were discussing a poll, which among other things established that (Surprise!) Republicans are exceedingly tolerant of racist and anti-Semitic politicians. Joe seemed to think that only the anti-Semitic part qualified them as fascists, but at least it’s a start:

MSNBC host Joe Scarborough called out Republican voters later on in the segment for their turn to fascism. Scarborough said, “Less than half of Republicans believe that uttering antisemitic remarks, spewing antisemitic remarks, is a serious problem and a roadblock to being elected.”

“That tells you a large chunk of the Republican Party right now, a large chunk of the Republican base are, — I’ve been using the word ‘fascist’ for some time.”

“That there is a fascist strain in the Republican Party for at least a third or so of those members,” Scarborough said.

There’s more to fascism than anti-Semitism and racism, and the Republicans have touched all the bases, book burning and demonization of trans people being just the latest examples.

The Democrats won’t win elections by ignoring this. It’s probably true that they won’t win if they don’t learn how to promote their own successes and attack the Republicans on multiple fronts. Two of the most fascistic fascists, Abbott and DeSantis, have gone out of their way to harm their states in their endless quest to feed raw meat to the base. Democrats have to learn how to exploit that fact. Abbott and DeSantis are the most prominent examples, but the argument applies to most Republicans. Still, it’s important that Democrats point out the obvious: that the Republican Party is now the American Fascist Party and if it prevails in the next two elections, we can kiss representative democracy goodbye.