• “I am the Koch brothers’ brother from another mother!” Herman Cain proclaimed during an appearance at Americans for Prosperity, Friday. This delicious scoop comes from Dave Weigel of Slate.
• Cain’s campaign accepted tens of thousands of dollars of legally dubious in-kind contributions from Prosperity USA, a non-profit headed by Cain’s chief of staff, Mark Block, Mark Bice of the Milwaukee Journal Sentinel revealed late last week. Block is also the former head of the Wisconsin chapter of Americans for Prosperity, a non-profit co-founded by the arch conservative Koch Brothers.
• Nick Confessore of the New York Times reported that an outside lawyer would be looking into the Cain campaign’s finances to determine whether the tax-exempt Prosperity USA violated campaign finance laws by paying for a variety of expenses for the Cain campaign including iPads and a trip for Mark Block to meet David Koch.
• In other campaign finance news, the downfall of New Jersey Governor Jon Corzine and his bankrupt brokerage firm MF Global may prove embarassing for President Obama, considering that Corzine raised at least $500,000 as an Obama bundler, according to Dan Eggen and T.W. Farnam of the Washington Post. They note that MF Global recently wrote a clause into a bond issue promising to raise interest rates by 1% if Corzine was appointed to a post in the Obama administration. As MF Global went into the eighth-largest bankruptcy in U.S. history, it was revealed that the firm had “lost track” of an estimated $633 million in client funds. The FEC is investigating whether MF Global gambled and lost other people’s money.

[Photo credit: Wandermule, Creative Commons.]

These aren’t used cars so much as usury cars….

In a special three-part series, Ken Bensinger of the L.A. Times investigates the wildly profitable but little known world of “Buy Here Pay Here” used car dealerships. These lots cater to a very specific clientele: People with terrible credit who need a car to hold a job.

In part 1, Bensinger explains the Buy Here Pay Here business model: sign, drive, default, repossess, and resell.

Faced with the choice between getting hosed buy a used car dealer and sleeping on the street, buyers will pay any price and accept financing on any terms. The dealers know it. Cars are priced above their Blue Book value and financed at an average interest rate of 20.7%, triple the national average.

Buy Here Pay Here dealerships are only nominally selling cars. Their real business is financing. And because they write their own loans, they are exempt from most forms of regulation. The “Pay Here” part of the name indicates that the buyer delivers payments in cash to the dealership.

You’d think that selling cars on credit to the country’s least reliable borrowers would be an unprofitable business. Not so. The average BHPH dealership turns a 38% profit.

The thing is, these dealers don’t care if customers make their payments. In fact, it’s better if they don’t. These cars come standard with hidden GPS trackers and remote ignition locks for easy repo. If a customer falls behind, the car is seized an resold. Bensinger found that cars were often resold at higher prices the second and third times around. 

In part II, Bensinger reveals that Wall Street is in on the racket. (At this point the reader may experience a sinking feeling in the pit of the stomach and an unshakeable sense of deja vu. That’s a common side effect of devastating investigative reporting. Do not be alarmed. Be enraged.)

Financial chopshops have sprung up on Wall Street to cash in on the BHPH boom. Loans originated by BHPH dealers are being securitized, meaning that financial wizards are chopping up these ultra-subprime auto loans and packaging them into securities for investors to buy. Some of these products are rated AAA.

This is the exact scam that led to the subprime mortgage crisis. Bad loans are being repackaged as securities backed by what are surely inflated ratings and pawned off on hapless investors.

These securities will turn into so much worthless paper if the BHPH industry can’t keep all the balls in the air. But neither the securitizers nor the used car dealers care because, they’ll have already made their money.

The third part of the series will run tomorrow. Sidney can hardly wait.

If the word gets out, Occupy the Lot could be the next phase of the Occupy Movement.

[Photo credit: SeeMidTN.com, Creative Commons; visit SeeMidTN.com on the web.]

• Last week, Sasha Chavkin of the New York World broke the news that the public B110 bus line in Brooklyn was sending women to the back of the bus to accomodate the religious sensibilities of the local Hasidic community. On Tuesday, Chavkin reported that the private company that runs the B110 had promised to end sex segregation.
• Ever wonder what happened to those scoundrels who nearly broke the capitalist system? No, not Occupy Wall Street, the bankers. Braden Goyette of ProPublica has an informative cheat sheet to bring you up to speed. 
• Speaking of sleazy bankers, the updated edition of Ed Vulliamy’s 2011 book Amexica: War Along the Borderline is going on Sidney’s reading list. Vulliamy tells Democracy Now! how the Wachovia bank allegedly helped launder tens of millions of dollars for the Sinaloa drug cartel.
• Massachusetts senate candidate Elizabeth Warren tells Luke Johnson of the Huffington Post that she not only supports the aims of Occupy Wall Street, she laid much of the intellectual foundation for the movement. This is true. As a Harvard professor, Warren did pathbreaking research on consumer debt and middle class bankruptcy. That line is also an interesting piece of political self-presentation. The Occupy Movement is understandably wary of politicians trying to coopt their movement. But if Warren can sell herself as one of the original intellectual architects of the movement, she may create space to court the Occupy activists without seeming to coopt them.

[Photo credit: Wander Mule, Creative Commons.]

Mississippi is poised to vote on a ballot initiative that would redefine fertilized eggs as human beings. Amazingly, both the Democratic and Republican gubernatorial candidates have endorsed this proposal.

Irin Carmon of Salon travelled to Mississippi to interview the leaders of the local Personhood movement. Officially, the impetus for redefining fertilized eggs as people is to ban all abortion prior to overturning Roe and, ultimately, to lay the groundwork to challenge Roe itself. As Carmon discovered, that’s only part of the agenda:

[T]he Personhood movement hopes to do nothing less than reclassify everyday, routine birth control as abortion. The medical definition of pregnancy is when a fertilized egg successfully implants in the uterine wall. If this initiative passes, and fertilized eggs on their own have full legal rights, anything that could potentially block that implantation – something a woman’s body does naturally all the time – could be considered murder. Scientists say hormonal birth-control pills and the morning-after pill work primarily by preventing fertilization in the first place, but the outside possibility, never documented, that an egg could be fertilized anyway and blocked is enough for some pro-lifers.

Indeed, at least one pro-Personhood doctor in Mississippi, Beverly McMillan, refused to prescribe the pill before retiring last year, writing, “I painfully agree that birth control pills do in fact cause abortions.” Bush does prescribe the pill, but says, “There’s good science on both sides … I think there’s more science to support conception not occurring.” Given that the Personhood Amendment is so vague, I asked her, what would stop the alleged “good science” on one side from prevailing and banning even the pill?

Bush paused. “I could say that is not the intent,” she said. “I don’t have an answer for that particular [case], how it would be settled, but I do know this is simple.” Which part is simple? “The amendment is simple,” she said. “You can play the ‘what if’ game, but if you keep it simple, this is a person who deserves life.” What about the IUD, which she refuses to prescribe for moral reasons, and which McMillan told me the Personhood Amendment would ban? “I’m not the authority on what would and would not be banned.” No – Bush simply plays one on TV. And if her amendment passes, only condoms, diaphragms and natural family planning — the rhythm method – would be guaranteed in Mississippi.

The proponents of ovum personhood in Mississippi come off as profoundly disingenuous and/or hopelessly off-message. A cynical reader might conclude that even they aren’t serious about this egg-as-person rhetoric. Are they really prepared to call for the death penalty for women who use IUDs? Because by their logic, those women are serial killers. It seems like this “egg as person” talk is just a pretext to restrict the rights of women.

[Photo credit: Sir Chalky, Creative Commons.]