The Political Class has honed a dangerous skill, building the perfect undetectable fraud machine. Americans need to learn to spot these scams for their own protection and realize that the perpetrators can come from either political party and often work in cahoots with attorneys or big business.

Think about three seemingly unconnected news stories, all examples of costly or dangerously indictable fraud machines…

• The economic collapse of 2008 was caused in part by relaxed mortgage rules that allowed borrowers to get a home loan without a down payment or even proof of income in some cases.
• In the Pigford settlement, claimants were able to get $50,000 checks by asserting without proof that they had “attempted to farm.”
• In a move strongly supported by the NAACP and other liberal advocacy groups, the Obama Department of Justice just stopped South Carolina’s plan to put in place some minimal ID requirements for voting. Currently voters in a number of states don’t need to show any photo ID or other identity checks in order to cast a ballot.

All three stories are examples of systems that have been intentionally set up with such low standards that they invite fraud. But ingeniously, they have also been set up in a such a way that makes them almost critic-proof because the lack of standards makes detection of fraud nearly impossible. When the system is questioned, the defenders, creators and beneficiaries then point to the lack of “proof” of fraud as a reason to keep the status. Thus, a self-perpetuating fraud scheme is kept alive as long as possible.

Make no mistake, these scams are costly….

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(Reuters) – Oral arguments on President Barack Obama’s sweeping U.S. healthcare overhaul will last 5-1/2 hours spread over three days from March 26-28, the Supreme Court said on Monday.

The Supreme Court last month agreed to hear the 5-1/2 hours of oral arguments, one of the lengthiest arguments in recent years. There have been similar marathon sessions in a handful of big cases dating back over the past 70 years.

The court said it would hear one hour of arguments on March 26 on whether the legal challenges to the requirement that all Americans buy insurance must wait until after that part of the law has taken effect in 2014.

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Former Illinois Gov. Rod Blagojevich was sentenced this week to 14 years in prison, but the real sentence is the one taxpayers will serve many years after. He mastered the art of pairing populist rhetoric with expensive new programs directed toward his core constituencies.

To pursue his highly visible programs and agendas, Blagojevich needed money. He found it by diverting billions from the state’s pension system. By taking “holidays” from required pension system contributions and by nearly doubling Illinois’s debt, he burdened future generations to support favored groups in the present.

Perhaps worst of all, as CEO of Illinois, Blagojevich institutionalized a culture of deficit spending. He accomplished this so effectively that Blagojevich’s successor, Gov. Pat Quinn, and today’s lawmakers feel comfortable perpetuating the ruinous habits of spending and borrowing more than the state can afford. Fiscal ineptitude is the new norm.

The Illinois Policy Institute has a new report out that details Blagojevich’s lasting effect on Illinois’ fiscal condition. Read it at www.illinoispolicy.org/blago. Here’s the “top ten” list:

No. 1: Disregarded obligations to state pensioners

Policy: Blagojevich diverted billions of dollars from the pension funds of future government retirees to pay for his own spending priorities.
Problem: Blagojevich ballooned existing spending programs, ignoring his responsibility to ensure the health of the state’s pension systems. Retirees and taxpayers are on the hook for his political expediency.
Program cost: Excess of $3 billion for future taxpayers

No. 2: A culture of deficits

Policy: Grow spending to appease Blagojevich’s core constituencies.
Problem: While Blagojevich was creating and expanding unaffordable programs, the state’s financial position deteriorated year after year.
Program cost: Worst rating of net assets in the nation.

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It’s just a piece of cotton thread.

And yet, in order to use that simple piece of thread in Arizona for the popular practice of removing unwanted facial hair, the state’s Board of Cosmetology demanded that highly skilled entrepreneurs sit through 600 hours of classroom instruction—with a price tag of up to $10,000.

And here’s the kicker:  not one hour of instruction teaches anything about threading:

Thankfully, five Arizona threading entrepreneurs teamed up with the Institute for Justice and fought back. And this week, they proved that you can stand up to government officials to defend your civil rights—and win.

As Institute for Justice Arizona Chapter Executive Director Tim Keller explains in the video above:

Threading is such a safe and sanitary practice that Arizona’s neighboring states – California, Utah and Nevada – have all exempted braiders from their states cosmetology licensing schemes.   Our goal is to restore the right to earn an honest living to its proper role as a fundamental right in Arizona.

And so last June, the entrepreneurs and IJ filed a lawsuit challenging the Board’s requirement that Arizona threaders first obtain a cosmetology license in order to use a single piece of cotton thread to remove facial hair.  And now those same entrepreneurs have joined the Arizona Attorney General’s Office in asking a Superior Court judge to sign a Consent Judgment that will end the litigation and prevent the Board from requiring threaders to become licensed cosmetologists.

Once the Consent Judgment is signed, every threader in Arizona will be able to work without fear of citations, fines or harassment from the Board.

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In a good sign for blogger free speech, a lawsuit against a high profile conservative blog in Illinois has just been tossed out. A political contributor brought the lawsuit over a story about property tax reassessments and political contributions. This is a victory for free political speech as well as a victory for the status of blogs in the world of “journalism.”

I’ve been aware of this story for some time but the folks at Illinois Review, the blog in question, asked me to sort of keep it all quiet. There were all sorts of legal questions being thrown about and since the folks that run the blog don’t have deep pockets and the whole thing was being born at their own expense, they wanted to be sure this whole mess didn’t escalate and hurt them too bad financially.

The lawsuit meant to silence the blog was a convoluted one, to be sure. Illinois Review had posted a story that revealed that former Ill. State Rep. Paul Froehlich (R, Schaumburg) had sought campaign contributions from property owners who had won property tax relief claims that the Representative had assisted in getting settled. But after the story went live, due to the notoriety the county assessors office reversed those tax relief decisions.

One of the property owners mentioned in the original story was Satkar Hospitality. Illinois Review reported the facts of the case, noted that Satkar got a favorable property tax reassessment, and speculated that Satkar made “in-kind contributions” to Rep. Froehlich.

For his part Rep. Froehlich claimed that there was no quid pro quo and said he’d known the folks at Satkar “before they even opened their hotel and long before they contributed to my campaign.”

Satkar sued the Illinois Review for defamation — naming Fox News and others as coconspirators.

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It should come as no surprise that the radical left is rallying behind former Ohio Attorney general Richard Cordray to head to powerful Consumer Financial Protection Bureau (CFPB) – a newly created government agency designed to regulate the American economy with little oversight from Congress.

MoveOn.org and other liberal groups are demanding Republicans play dead and allow Cordray to be confirmed by the Senate for a five year term where he can singlehandedly dictate regulations government nearly any financial transaction in America.

Quietly another interest group is rallying to Cordray’s corner – the securities lawyers.  Daniel Fisher, writing at Forbes.com noticed that despite the constant bashing of the financial industry by Cordray, he is wildly popular with securities class action lawyers and law firms:

Lawyers at Labaton Sucharow contributed $125,000 to various Cordray campaigns between 2008 and 2010, according to Ohio campaign-finance records. Delaware-based Labaton represented Ohio in the AIG case, which it settled last year for $1 billion including something like $90 million in fees (the final fee payout, surprisingly, isn’t on the AG’s website).

Lawyers at crosstown Delaware rivals Grant & Eisenhofer ponied up $25,000 for the Cordray campaign; they represented the state in a lawsuit against Marsh & McClennan that netted the state’s outside lawyers 13% on a $400 million settlement. Other out-of-state law firms that took a keen interest in Cordray’s campaign included Atlanta’s Chitwood Harley, which gave $146,000; Berman deValerio of San Francisco and New York’s Bernstein Litowitz, known for its generosity in seemingly obscure state political races, which gave $50,000.

That’s because Cordray has a scandalous record of “taking money from lawyers who profit from private litigation that often follows closely on the heels of government investigations…” So, the reality is that President Obama’s liberal white-hatted regulator appears to be neck deep in a pay to play scandal with trial lawyers.

Republicans appear ready to hold the line on the nomination with 44 Senators signing a letter refusing to support any nominee until the CFPB is reformed and proper checks and balances are put into place.  But there is a bigger story and a bigger scandal brewing.

It looks like it is finally going to happen. The Federal Communications Commission (FCC) has finally gotten their net neutrality regulations through the bureaucratic mess, and now it [IS] only a matter of times before they start to take effect.

The National Journal reports:

Open Internet regulations, or network-neutrality rules, have cleared the final regulatory hurdle before getting on the books, a Federal Communications Commission spokesman said on Monday.

The rules, which limit how cable and phone companies can treat legal Internet traffic, are strongly opposed by Republicans in Congress, who have unsuccessfully attempted to repeal them on several occasions.

The FCC passed the regulations in December over Republican objections, creating the defining saga of commission Chairman Julius Genachowski’s tenure so far and fulfilling an Obama campaign promise.

The Office of Management and Budget, which had a procedural role in OK’ing the regulations thanks to the Paperwork Reduction Act, had to review new data-collection responsibilities that the rules apply to Internet service firms. “OMB signed off late Friday,” an FCC spokesman said in an e-mail.

From the Associated Press:

A federal appeals court in Virginia dismissed two lawsuits Thursday that had challenged the constitutionality of President Barack Obama’s health care overhaul.

The three-judge panel of the 4th U.S. Circuit Court of Appeals ruled in both lawsuits—one filed by Virginia Attorney General Kenneth Cuccinelli, the other by Liberty University—that the plaintiffs did not have standing to sue. The court did not delve into the constitutional issues.

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As I’ve written about before, when Iowa Congressman Steve King recently tried to stop funding for the fraud infested Pigford settlement he was opposed by a number of his fellow Republicans.  At least one of them —  Florida’s Allen West — has admitted that his vote was “a mistake” while others such as California’s Darrell Issa have so far remained silent.

Now Missouri Congressman Billy Long has gone on the record with one of his constituents about why he wanted to continue funding a bill that doesn’t actually help the black farmers that it was designed to aid in the first place.

Here’s what he said in a recent letter…

Thank you for contacting me regarding Roll Call Vote number 444, which addressed the Pigford discrimination case at the United States Department of Agriculture; I appreciate hearing from you.

As you know, the amendment offered by Congressman Steve King (R-IA) would have prohibited funding for payments relating to the final settlement of claims from the Black Farmers Discrimination Litigation, also known as the Pigford case.  I voted against this amendment, along with several other Republicans, because stopping payments could increase the risk for additional litigation.  I firmly believe I must take every step I can to curb costly litigation, which hurts businesses and job creation in this country.  I also believe I must take every step to slow out-of-control government spending at every turn.

A fear of “additional litigation” is a horrible reason to support Pigford. In fact, one of the main reasons that it’s important to stop Pigford II as soon as possible is because of the additional litigation that it supports.

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Georgia has some of the worst civil forfeiture laws and practices in the country.  This morning, five Atlanta citizens teamed up with the Institute for Justice to change that.

Civil forfeiture threatens the property rights of all Americans.  These laws allow government officials to seize your home, car, cash or other property upon the mere suspicion that it has been used or involved in criminal activity.

In an attempt to ensure civil forfeiture is subject to public scrutiny, Georgia law requires local law enforcement agencies to annually itemize and report all property obtained through forfeiture, and how it is used, to local governing authorities.

But many—perhaps most—local Georgia law enforcement agencies fail to issue these forfeiture reports.  Today, the Institute for Justice issued a report of its own: Forfeiting Accountability: Georgia’s Hidden Civil Forfeiture Funds. It finds that among a random sample of 20 law enforcement agencies, only two were reporting as required.  Of 15 major agencies in Georgia population centers, only one produced the required report.  Yet federal data show Georgia agencies taking in millions through forfeiture.

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In Michigan, police were caught on tape stealing private property:

What do you want to take in the basement?  Do you want to take the drums and all that (expletive), or no?

The police took three pages worth of property that included a 52” flat-screen TV, a DVD player, two computers, a camera and several DVDs.

Why does this kind of abuse happen?  The answer is civil forfeiture.

In the United States, if the government suspects that you committed a crime, officials can arrest you and put you on trial.  The government must then prove you are guilty beyond a reasonable doubt.

But if the government suspects that your property was involved in a crime, under civil forfeiture laws officials can take and sell your property.  In most instances, they get to pocket the proceeds.  Importantly, they don’t have to prove you did anything wrong.  This sounds bizarre, but with civil forfeiture, your property is guilty until you prove it innocent.

As civil forfeiture expert Scott Bullock explains in the above video:

You cannot give the very people who are out there enforcing the laws a direct incentive to try to take homes, cars, currency, and other property from citizens.  Under the law in over 40 states, police and prosecutors are allowed to keep all or most of the property that they seize.  So this gives them a very direct incentive to go out and take as much property from citizens as possible.

This explains why one of the police officers caught on tape says, “If Luke comes down here, he’s gonna wanna take everything . . . he’s gonna give us a chance to frickin’ take all this stuff.”

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The mainstream media has treated accusations of large-scale fraud in the Pigford settlement with overt skepticism and a distinct lack of journalistic curiosity. The press has blindly repeated the Obama Administration’s claim that there are only a handful of fraud cases among the twenty thousand or so paid Pigford claims.  Worse, the media has helped promote the narrative that those raising concerns about fraud in Pigford are racist.

You’re about to watch a video clip where Othello Cross, an attorney for Pigford claimants with about fifteen years of experience on the case, admits that he is personally aware of hundreds of cases of fraud in the state of Arkansas alone. Furthermore, he explains how easy it was to commit that fraud and receive a $50,000 check from the government; it’s appropriate to deduce from Cross’s revealing statement that the actual number of fraudulent claims is likely much higher than the hundreds he knows about.

You’re about to watch this clip for the first time, but the USDA watched it over a week ago — I sent it to them for comment about 10 days ago.

After a number of phone calls to the USDA, I was given the response that Secretary Vilsack now acknowledges around ten cases of fraud, up from his original statement that there are only three known cases. If I were inclined to spin the government’s response, I’d praise the USDA for finding 300% more instances of fraud in just a few days, but the reality is that the USDA can watch a video where a pro-Pigford claimant lawyer says in no uncertain terms that he knows about hundreds of cases of fraud — over ten million dollars worth at bare minimum — and still will only acknowledge ten cases.

As Andrew Breitbart points out, the media simply doesn’t want to cover Pigford. I also sent this video to a few major media outlets that stated they wanted to “research” this. I haven’t heard back from any of them. (more…)

From the Huffington Post:

One thing that’s emerged from every conversation I’ve had is that America’s black farmers are this country’s unsung heroes. Farming is hard enough work on its own, but when you add the additional weight of fighting the government’s “good old boy” network that existed in many places, the resilience of the black farmers is amazing.

The dignity of the black farmers makes the mainstream media’s blanket of silence about Pigford especially offensive. A black reporter I spoke with attributed some of that to the subtle systemic racism that exists in the mainstream media, with a bias towards covering stories that affect or are about white folks. Too often, the press is able to pat itself on the back by dealing with stories about race in a surface way. They pretend that by calling the Tea Party or a Republican politician a racist, they’ve done their job and scored a victory for minorities. In fact, though, all those reports end up doing is casting heat but not light. They stir up racial tensions and let the press give themselves a pass for not actually digging into a story like Pigford.

Another thing that everyone seems to agree on about Pigford is that it’s a very complex story. It’s not something that can be explained easily between two commercial breaks or in a couple of soundbites. That being said, it’s fascinating — a long, winding trail of outright corruption and wholesale fraud weaving itself between complicated, passionate people on all sides who have struggled to do the right thing to remedy the plight of black farmers.

The story the press wants you to hear about Pigford is an overly simple one; it’s a settlement to remedy black farmers, and last week (over the racially tinged objections of a tiny group of House Republicans) the president signed the Pigford 2 extension that provides more than a billion dollars in funding for late filing farmers.

The problem with that explanation of Pigford is that it’s false on nearly every level.

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Florida trial attorney Chris Hoyer, who along with his wife, has donated close to $30,000 to President Barack Obama and other Democratic candidates and causes over the last decade, appears to be curiously in-tune with the Democratic administration’s agenda on higher education.

Hoyer, through his James/Hoyer Law Firm, is targeting for-profit career schools for class actions at around the same time the Obama administration Department of Education appears to be targeting that same industry through aggressive new regulatory action and rule making.

Hoyer has filed a lawsuit against Westwood College, claiming the school lied about tuition costs and future salary potential for graduating students. As with any class action situation, where the people who benefit are primarily the attorneys, Hoyer’s class action pursuits should not be taken lightly. His 2008 action against Waste Management Company yielded each plaintiff a whopping $25.

But the underserved, largely black and Hispanic students who tend to enroll in similar career schools need to worry that their education choices are under legal assault. “I’m not trying to attack the whole for-profit school industry,” Hoyer maintains. Nevertheless, James/Hoyer claims on its website that it is “investigating” no fewer than seven such for-profit colleges.

As it happens, the Department of Education has begun an aggressive campaign to enforce a beefed up “Gainful Employment” rule. As former New Jersey Governor and 9/11 Commissioner Thomas Kean recently pointed out, this “Gainful Employment” rule appears to be specifically targeted at the same career schools in Chris Hoyer’s laser scope:

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Too many elected officials are far too comfortable spending taxpayer dollars without knowing where that money will actually end up. This was proven once again by the Senate’s vote to fund the Pigford Settlements, even though serious claims of fraud exist.

In September, I joined my colleagues Congressmen Steve King (IA-05) and Bob Goodlatte (VA-06) to call for a full investigation into the Pigford Settlement Case. As a constant advocate for careful use of taxpayer dollars, I was concerned when I learned that this Settlement has 94,000 claims of discrimination, even though only approximately 33,000 black farmers exist in the United States.

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Carl Mitz is a third-generation horseman.  The Texan is widely known as one of the nation’s best horse dentists.  He’s treated the teeth of over 100,000 horses and has clients in over 30 states.

But Texas bureaucrats tried for years to shut him down.

In a classic case of economic protectionism, Carl and all other Texas equine dentists were told they had to spend up to $100,000 and four years at veterinary school, where they would learn next to nothing about caring for horses’ teeth, or else abandon their occupation.  To top it off, they were threatened with massive fines and even jail.

Instead of giving up his American Dream, Carl teamed up with other Texas horsemen and the Institute for Justice to fight for their right to earn an honest living.

And this week, they won.

On Tuesday, a Texas judge struck down the effort by the Texas Board of Veterinary Medical Examiners to put equine dentists like Carl—known as floaters—out of business and leave the state’s approximately one million horses without proper dental care.

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Carla Main wrote an outstanding book called Bulldozed.  A veteran journalist, she brought to life a heart-wrenching, true-life tale of eminent domain abuse in a Texas fishing town.  She told the truth.  And for that, she’s being sued.

Today, Carla is fighting back.

This morning, Carla asked a Texas appeals court to dismiss a defamation lawsuit filed against here by a developer involved in the Texas case.

Some background:

The Texas developer behind this abuse project is H. Walker Royall.  As the video makes clear, millions of taxpayer dollars later, the project is now an epic debacle.

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You’ve probably heard about eminent domain abuse.  That’s where the government takes your land and hands it over to another private party….one that is more politically connected.

But you may not have heard about civil forfeiture.  And yet, today, it could very well be the most egregious abuse of private property rights in America.

We all know that one of the many beautiful things about the United States is that citizens are innocent until proven guilty.  But civil forfeiture turns that fundamental principle on its head.

This sounds bizarre, but with civil forfeiture, your property is guilty until you prove it innocent.

Consider the case of Margaret Davis.

As a 77-year-old woman living alone with multiple medical problems, Margaret left her Pennsylvania home unlocked so her neighbors could regularly check on her.  One day while the police were chasing alleged drug dealers through her neighborhood, they all ran through Margaret’s house.  The dealers dropped some of their stash on Margaret’s floor, in plain sight.

Instead of apologizing to Margaret for the traumatic experience, the government seized her house.

Under civil forfeiture laws, Margaret’s property—her house—was guilty until she could prove it innocent to get it back.  And that’s not all.  As it turns out, most state and federal laws allow the government to keep the property they take through civil forfeiture.  So authorities have a big incentive to pursue property over justice.

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Today the Institute for Justice filed opening briefs in our fourth case to appear before the U.S. Supreme Court.

IJ’s first trip to the high court came in 2002 and resulted in a landmark victory for school choice.  We also won our second U.S. Supreme Court case, defending the American ideals of economic liberty and unfettered interstate commerce by striking down a ban on the direct shipment of wine.

Our third case changed America forever.  A local government in Connecticut decided to bulldoze an entire neighborhood and hand the land over to a politically connected private developer.  The law was stacked against the property owners in favor of the powerful special interests.  IJ, defending the property owners, lost in a controversial 5-4 ruling.

This was the infamous Kelo case, and it resulted in an explosion of outrage and grassroots activism all across the country.  Ed Morrissey recently wrote at Hot Air that it arguably set “the stage for the all-out eruption of Tea Party activism a few years later.” This epic battle to protect private property rights, ultimately vindicated by grassroots activists just like you, is one that will never be forgotten:

And now, as children nationwide get ready to begin a new school year, the Institute for Justice is defending Arizona’s innovative scholarship tax-credit program before the highest court in the land.

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If government is serious about job creation, it should get out of the way of the entrepreneurs who actually create them.

That is the message of a new campaign launched this week by the Institute for Justice—the nation’s leading legal advocate for economic liberty. A series of studies called The Power of One Entrepreneur highlight the tremendous impact that a single entrepreneur can have on their family, employees, community, other entrepreneurs and beyond.

Consider Melony Armstrong of Tupelo, Mississippi.

Melony is an African hairbraider and a mother of four.  She is the owner of Naturally Speaking, a hairbraiding salon that serves her community and has employed dozens of women.  In addition, Melony has taught more than 125 individuals how to braid.

But before she could even open her doors, she had to battle through mountains of red tape. The state forced her to spend 300 hours in cosmetology classes.  And to teach others how to braid, she had to obtain a special license that required over 3,000 hours of additional classes.  Here’s the kicker:  In all of this government-mandating training, she received no actual instruction in hairbraiding.

In August 2004, Melony teamed up with the Institute for Justice to challenge these needless barriers that had the effect of keeping grassroots entrepreneurs just like her from being able to open their own businesses. Less than a year later, her case resulted in a new law that lifted the restrictions, paving the way for hairbraiding entrepreneurship throughout the state.

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