The biggest banks in the United States have become too big – from a social perspective.  There are obviously private benefits to running banks with between $1 trillion and $2.5 trillion in total assets (as reflected in today’s earnings report), but there are three major social costs that the case of Goldman Sachs now makes quite clear.

1)      The megabanks have little incentive to behave well, in terms of obeying the law.  There is fraud at the heart of Wall Street, but these banks have deep pockets and suing them is a daunting task – as the SEC is about to find out.  The complexity of their transactions serves as an effective shield; good luck explaining to a jury exactly how fraud was perpetrated.  These banks have powerful friends in high places – including President Obama who still apparently thinks Lloyd Blankfein is a “savvy businessman”; and Treasury Secretary Geithner, who is ever deferential.

2)      The people who run big banks brutally crush regular people and their families on a routine basis.  You can see this in two dimensions

A. They are not inclined to treat their customers properly.  They have market power in particular segments (e.g., new issues or specific over-the-counter derivatives) and there are significant barriers to entry, so while behaving badly undermines the value of the franchise, it does not destroy the business.  Talk to some Goldman customers (off-the-record; they don’t want to bite the hand that hurts them).  Lloyd Blankfein still claims that the client comes first for Goldman; most of their clients are surprised to hear that.

B. Small investors also lose out.  Who do you think really bears the losses when John Paulson is allowed to (secretly, according to the SEC) design securities that will fail – and then pockets the gains?

3)      Underpinning all this power is the ultimate threat: Too Big To Fail.  If a big bank is pushed too hard, its failure can bring down the financial system.  This usually means protection when the system looks shaky, but it can also protect big banks from serious prosecution – if their defenders, like Jamie Dimon, can make the case that this would undermine system stability and slow the creation fo credit.  (This is startlingly parallel to the arguments made by Nicolas Biddle against Andrew Jackson during the 1830s; see chapter 1 of 13 Bankers).

In turn, this puts competitors at a major disadvantage, because the bigger banks can borrow on better terms.  The extent of protection provided to management and boards in 2008-09 was excessive, but what really matters is the protection perceived and expected by creditors going forward.  And this is all about whether you can credibly threaten the creditors with losses.  This, in turn, is about a simple calculus – if a firm is in trouble, will it be saved?

Georgia state lawmakers are discriminating against immigrants through proposed legislation SB 67 that would restrict driver's license exams to be issued in English only. Currently the state offers the exam in 13 different languages but according to State Senator Jack Murphy, the chief proponent of the legislation, restricting the privilege to English-only drivers is a matter of safety. The senator believes that foreign language drivers pose a danger because they cannot read English language road signs. If Georgia offered driving tests only in English it would eliminate the perceived problem.

I say perceived because I could find no evidence that non-English speakers are a danger. Even in legislative hearings, as the bill was being debated, there was no testimony by road safety experts to prove that English-only drivers would improve safety. Not only was there no evidence the bill would make Georgia roads safer, the proposed bill offers driver's licenses for illiterate drivers. Fifteen percent of driver's licenses in Georgia are issued to people who cannot read at all. According to Senator Murphy, they qualify as safer drivers than the non-English literate immigrants. If the bill passes, U.S. citizens and legal residents who are not proficient in English will be prohibited from driving.

I tried to speak with Senator Murphy but was told he was not available until after the legislative session. I tried to speak with a representative from the Governor's office, Sonny Perdue, but received no response. I called the Chamber of Commerce of the State of Georgia to see what their position might be -- no response. The immigrant community, civil rights leaders and religious community vehemently oppose the restrictive bill. Jerry Gonzalez, executive director of Georgia Association of Latino Elected Officials (GALEO) calls the measure xenophobic and anti-immigrant. "There is no evidence that this measure will make roads safer. It is just an attempt to target immigrants, legal or not." The bill will affect an estimated 60,000 immigrant drivers. People who need their car for employment or transporting their children will have to use an inadequate public transit system or find alternate transportation. Non-English speakers who have a history of safe driving will no longer be permitted to operate a motor vehicle. Bill Nigut, Southeast Regional director of the Anti-Defamation League (ADL) says, "The economic harm of an English-only policy could have a devastating impact. Many will not be able to obtain a driver's license and will be stranded and unable to go to work."

If there is no substantiated or legitimate basis for the restrictive legislation one can only draw conclusions that non-English speakers are not welcome in the state of Georgia. Some speculate that the bill is aimed at the growing Spanish speaking population and undocumented immigrants. It is a harsh, punitive measure that will not curb illegal immigration but will probably score political points.

The vast majority of non-English speakers in the state of Georgia were most likely marginalized in their home countries, fled oppression, escaped poverty, survived war or were searching for better opportunities. They have run into the arms of America to be embraced by the nation of immigrants where all are considered equal and all have a fair chance at stability and success. To require an English-only driver's license exam is literally forcing immigrants to sit at the back of the bus. They are not safe enough, smart enough or worthy enough for the simple liberty of driving a car. I wonder what any of us would feel like if our driving privileges were stripped for no legitimate reason.

The Georgia state legislature has made a scapegoat of immigrants for some cheap political gain. To further oppress and restrict the mobility of an already vulnerable population is cowardice and shameful. What Senator Murphy and his supporters do not understand is that immigrants are a vital part of what makes this country strong and unique. America was never intended to be a home just for the white, rich and English speakers. If the Statue of Liberty were somehow moved to Georgia, the powerful ode to immigrants by Emma Lazarus would have to be modified to accommodate the bigotry of the Georgia State Legislature:

"Give me your wealthy, I shun the immigrant poor,
Your huddled politicians yearning to be free (of Spanish),
The wretched refusal of your driving test score.
Send these, the homeless, tempest-tost away from me
I turn off my lamp beside the closed golden door."

I apologize to Emma Lazarus for my unskilled poetry. Please read the real poem here and see if the State of Georgia is living up to her promise.

Steve Davis voted yes on SB 67

IT IS HARD to tell sometimes if Georgia’s legislators simply don’t understand English or if they know it all too well. The number of proposals that start out with wording aimed at one objective when announced and then say something totally different by the time approved has become astounding.

Worse yet, some in the General Assembly appear increasingly prone to seize upon the “hot button” issue of the moment to slop out a bill in reaction — no, that’s not a typo and “slap out” was not intended as we’re discussing slop here.

An excellent case in point is House Bill 1322, which would strip the public of the right to know much that its public servants do that breaks existing laws, if not bones. The measure, which unanimously has passed both House and Senate, was amended in the latter body so as to make sure citizens could never know, much less see and hear in this age where everything is recorded, the evils done in their name. It was actually accomplished during Sunshine Week, an annual event to promote open government,

When HB 1322 began, it was supposedly intended only to keep the profit motive out of catering to ghoulish interests. This was doubtless in tune with majority sentiments although based more on emotions than reflection. Many had been understandably appalled by a request from a “true crime” writer under contract to Hustler magazine for copies of crime-scene photos of the nude, dismembered body of Meredith Emerson, murdered in the North Georgia mountains in January 2008. The culprit, suspected in other similar crimes, has already been caught and convicted.

THE YOUNG woman’s family didn’t like the request and no doubt most everyone else had visions of Ms. Emerson’s remains being published in a “skin mag.” Obviously, if Hustler wanted it there had to be “prurient interest,” right?

It might be wise to remember that “scandal sheets” and similar, including a lot of web-only investigative sites, have the same “freedom of the press” rights, and use similar “credentialed” personnel as those of which the new measure speaks, as does this newspaper. Fact is, if somebody like the Rome News-Tribune or New York Times had wanted access to those same photos, no murmur would likely have arisen. Obviously, we are “legitimate” and of good reputation hence must have a valid reason to look at them.

However, that “credentialed” alone was a warning signal, though few saw looming danger in it. What the heck is a “credentialed” journalist anyway? Someone under contract to Hustler, a magazine operating with free-press rights just as does this newspaper, is “credentialed.” Does the legislature mean somebody with a college degree in journalism? Or does it mean that the state is planning to “license” reporters of any sort as it does medical professionals of any sort?

Besides, both bad taste and lousy manners are perfectly legal even if not laudable. Not only Hustler but much in our current culture — print, TV, film, music, the Internet and more — lives upon the profits of catering to poor tastes and manners. Hence, this can be seen as yet another effort to further have government assume a “big daddy” role by restricting personal choices — largely rotten ones, to be sure, but still a matter of personal preference and liberty.

THE MEASURE turned the corner of Iffy Street and wandered onto Lunacy Boulevard when the Senate adopted by amendment from Sen. Donzella James, D-Atlanta, to additionally block the release of many audio and video recordings made by police, 911 and similar agencies to anyone, including “credentialed media.”

These are, lest anyone forget as the Senate did, recordings made using public funds on public equipment with the intention of monitoring public services to make certain they are being done properly by public employees. That’s about as clearly “the public’s business” to know as anything can be.

So, as now passed (the House still has to agree to the amendment) the law starting July 1 would be that citizens cannot see or learn of “the records of a law-enforcement agency, an emergency 911 system, a public-health agency or any other similar agency when such records consist of or contain audio or video recordings of the personal suffering of a crime victim, disaster victim or other person in physical pain or distress; and public dissemination of such records would cause emotional distress to the person whose suffering was so recorded or to the family of such person.”

As most citizens know — from having seen a steady diet of such things on the news — a person being beaten, Tasered, kicked and so forth by a passel of officers during arrest is in “physical pain or distress” even if the force was justifiable. A family involved in a domestic disturbance 911 call ending in violence is certain to have “emotional distress” every time it is replayed. And so forth.

JUST AS important to remember, these recordings are not only what get some police officers and similar into trouble, they also protect the overwhelming majority of good cops and other government employees from the minority of “bad eggs” or “short fuses” in their departments. Not only in Georgia but across the nation such electronic advances have brought much to light and corrected many wrongs. Returning to the Dark Ages of hushed-up abuses and errors by government is not acceptable.

When HB 1322 started out it was only about blocking access to “certain photographs fewer than five years old which are in the custody of a law-enforcement agency which show graphic images of the sexual organs or the dismemberment of the dead body of a crime victim whose identity is known.”

Now look at where it is — and on the verge of becoming law. It would keep not only “credentialed media” but all citizens from ever learning about far more than bad taste and terrible manners. It will allow actual crimes, abuse of authority and “firing offenses” to be concealed from the eyes of all citizens.

A measure that began as an effort to block distribution of lewd crime-scene photos threatens to become, at the hands of the serial linguistic rapists in the legislature, a denial of the public’s right to know. That elevates this issue well beyond a matter of bad taste and puts it into the category of being obscene.

It was in the finest tradition of representative government that state Sen. Donzella James, D-Atlanta, proposed an amendment to a House bill restricting public access to some crime scene photos. Her amendment would extend that restriction to recordings of some 911 calls and some police dashboard video camera footage. And given the sensitive nature of such material, it's hardly surprising the Senate would vote 50-0 in favor of amending the House bill.

Unfortunately, in rushing - however understandably - to protect the interests of crime and disaster victims, senators have set the legislature on a course toward ignoring the interests of the public in knowing whether the emergency personnel who are paid with their tax dollars are doing their jobs.

House Bill 1322 was drafted last month as the legislature's response to a request made to the Georgia Bureau of Investigation by a true-crime writer working for the pornographic magazine Hustler. In a matter that now is awaiting resolution in the courts, the writer has asked the GBI for crime scene photos in the murder of 24-year-old University of Georgia graduate Meredith Emerson. Emerson's nude and decapitated body was discovered in the North Georgia mountains in January 2008, shortly after she was slain.

In the version that passed the House, the bill exempted crime scene photographs showing a deceased person whose body had been mutilated, or whose genitalia were exposed, from disclosure to the media and the public under the Open Records Act. That version of the bill brought a relatively muted reaction from the media. This newspaper offered two editorials, on March 10 and March 12, arguing primarily that exempting such admittedly gruesome material from disclosure could unduly limit the public's ability to determine whether law enforcement authorities had adequately investigated a crime, or whether it was possible to arrive at a conclusion different from law enforcement about the circumstances of a crime.

While those are valid arguments, they are admittedly technical and relatively narrow. It's far easier, and far more vital to the public's right to know, to make the case that the amended bill passed by the Senate places an undue restriction on the public's access to information on public agencies. Here is the problematic language of the amended bill, which exempts from public disclosure the following:

"Records of a law enforcement agency, an emergency 9-1-1 system, a public health agency, or any other similar agency when:

"(A) Such records consist of or contain audio or video recordings of the personal suffering of a person in physical pain or distress;

"(B) Public dissemination of such records would cause emotional distress to the person whose suffering was so recorded or to the family of such person."

According to a Morris News Service report, Sen. James proposed the ban on 911 and other emergency service audio and video recordings on the basis of having heard the repeated broadcast of the final words of a victim of the flooding that plagued the Atlanta area in September.

According to an Atlanta Journal-Constitution report, residents of Douglas County, particularly hard-hit by the September flooding, had asked their senators for the disclosure exemption.

While James and other legislators deserve credit for responding to constituent concerns, a major problem with the amended bill is immediately apparent. How, exactly, is it to be determined whether a recording "consist(s) of ... the personal suffering of a person in physical pain or distress"? Clearly, anyone who calls 911, or is stopped by a police officer, or otherwise is interacting with emergency personnel, is almost always in some degree of suffering or distress.

Thus, the amendment creates the very real possibility that all 911 call recordings and all police dashboard videos would be exempt from disclosure. And that, in turn, creates the possibility that the public might never learn whether emergency personnel responded effectively and efficiently to a given emergency.

Again, it's clear that James and her Senate colleagues had the best of intentions in amending House Bill 1322. But if the bill remains as it is, and is signed into law that way, they will have done irreparable damage to the public's right to know what their government is doing.