June 25, 2005

The Dukester's former neighbors weigh in with their two cents on the 2003 transaction, and share their warm memories of the Congressman:
Neighbors got their first inkling that something was going on at Rep. Randy "Duke" Cunningham's Del Mar-area home when they saw him packing.

Next door neighbor Kent Greene asked: "Are you selling your house?"

"Already sold," Cunningham answered.

When neighbors later learned the $1,675,000 price, they were even more astonished.

"There was something fishy with the whole thing," said Mark Konopacke, who had bought his home across the street six months before for $700,000 less [ed.-see here].


Some have dubbed the controversy "Mansiongate," but the house's original owner, Barbara Casino-Mizer, laughs when she sees the house in the papers. She and her husband, Corky Mizer, bought the ocean-view home from the builder in April 1987 for $385,000.

Casino-Mizer loved the big kitchen, the mosaic-tiled bathtub and the mauve carpet that was all the rage in the late '80s. However, when the couple found another home with acreage nine months later, they put the Mercado home on the market. Cunningham, who had been teaching at the Navy's Top Gun flight school, bought it for $435,000.


The decorative bars Cunningham put over the windows gave the stylish home an ominous prison-like look, some neighbors said. They called it an eyesore. The neighborhood, though, was desirable. Many homes have ocean views, and each has its own style. Values shot up.

Mark and Victoria Konopacke purchased their 2,806-square-foot home across the street in May 2003 for $905,000. In November 2003, Cunningham – a member of the House's defense appropriations subcommittee – sold his house to Wade.

Neighbors say they never saw Wade. Some heard the house had been purchased by a government employee with tax dollars. Others heard a friend bought it. The house went on the market again almost immediately for $1,680,000.

"When I saw the price, I said, 'Thank you for raising my property values,' " Kipnis said.

Many neighbors peeked in during the open house.

"We all knew it wasn't market value," said Victoria Konopacke. "It was a dump. The place needed to be gutted."

Her husband, Mark, added: "I'm not surprised at all people are asking questions."


Next door to the congressman's old place, Kent Greene has a for-sale sign posted in front of his house. He's asking $1,650,000.

Greene said that while the price may have been "ridiculous" for Cunningham's house in 2003, his home is highly upgraded and the market has moved up.

"It's a good neighborhood," he said, "an improved house, and, let me put it this way, it's better without him here."
The article actually has some good news for the saleslady who provided the comps now in dispute: the house across the street that sold for $900k a few months earlier was about 3/4 the size of the Cunningham condo, so an argument could be made that a significantly higher price would have been justifiable. Still, the lack of any sort of independent investigation by the purchaser just gives this whole deal a bad odor, since it would have revealed why this was not a $1.7 million home in the 2003 market.

June 24, 2005

Some interesting takes on RoveGate, from Kevin Drum and Michael Totten. Both seem to get the truly outrageous part of his speech, where he accused liberals of treasonous conduct in opposing torture at G-mo and elsewhere. The part that seems to have everyone else exorcised (about how the liberal solution to the 9/11 strikes was based on "law enforcement" and "empathy") seems to me to be standard knuckle-dragging rhetoric from the far right, too banal to be taken as a credible attack, and as a criticism, unintentionally ironic: does Bush's Brain really want to go on record attacking the other side for its commitment to law enforcement and due process at a time when Osama bin Laden and other top leaders of Al Qaeda are celebrating their fourth year of freedom since the WTC fell, when the conservative solution to terrorism is to participate in an endless stalemate against arbitrary adversaries disconnected to the original attacks, and when the only justification that the soft-on-torture crowd seems to offer in defense of Abu Ghraib, G-mo and elsewhere is that we're not yet as bad as Stalin.

Exactly where does Karl Rove get his reputation for being a great genius anyways? This is the guy who had Bush sit on the ball with a double-digit lead in late-October, 2000, even going so far as to take days off from the campaign trail, only to see the lead collapse in the final two weeks; only a rigged vote count and some voting abuses in Florida that would have made Bull Connor proud saved his boss from a more embarrassing loss than Tom Dewey. Republicans maintained their majorities in Congress in both 2002 and 2004, due almost entirely to gerrymandering and the rural, small-state bias that dictates Senate elections (the dirty little secret of that "majority" right now is that Democratic candidates consistently receive more votes than their GOP counterparts in both the House and Senate). In spite of those majorities, they can still do little more than hit at New Deal and Great Society programs at the margins.

Even with a country at war and an improving economy last year, two factors which historically guarantee victory at the polls, Bush won by the narrowest reelection margin in history, against an unlikeable, politically-inept opponent (and a Massachusetts liberal, to boot), and managed to carry only one more state than he did last time, before 9/11. He has built the current Republican base on the least-productive, most-government dependent regions in the country, while pursuing a political strategy based on social wedge issues, particularly gay civil rights, that are heavily dependent on aging, reactionary voters who will have less sway as time passes.

Looking at the long term, color me unimpressed.
YBK [Part 7]: The official May figures for the Central District of California are now out, and they show a 22% jump in total filings over last year. Chapter 7 petitions were up by over 26% from the previous May, while Chapter 13 filings, where a debtor proposes to repay some or all of his debt over a 3-5 year period, continue to slide. The only thing stopping a full-fledged bankruptcy panic is the housing market.
Finally, a webpage dedicated entirely to Randy "Duke" Cunningham. If you want to see the actual deeds from the transactions in question, or view photos of the now-historic Cunningham estate in Del Mar, that is the place to visit.

June 23, 2005

Randy Cunningham speaks, finally, but won't answer any questions. Clearly, he's the victim here, and all the blame rests on the friend who gave him inflated comps and the other friend who believed them (and what does that say about Mr. Wade, whose company gets multi-million dollar top-secret contracts from the military but who won't perform due diligence when purchasing a house). It's hard to see how The Duke can explain away living at his benefactor's yacht for less than $1200 a month; if dockside living is that cheap, I'm surprised we don't see more slackers wasting their lives away on houseboats parked in San Pedro.
A reader comments on my comparison of brokers and salespersons:
While I agree that the Cunningham real estate deal sounds... corrupt as hell... you are mistaken on one point. A real estate salesperson is in no way comparable to a clerk or a paralegal in a law office.

Other than having their contracts reviewed and signed off on by their broker, they have all the rights and responsiblites as a broker. And even licensed brokers who work in an office usually get their contracts reviewed and signed off by the head broker in the office, or their assistant manager.

For that reason, many of the top selling and most experienced agents do NOT have a broker's license (I didn't and I was a top agent for almost 30 years off and on) since unless you own your own firm and need one, it really doesn't serve any real world purpose to have one.
The commenter is a salesperson who has both personal and professional experience with law offices, so I will of course yield to his expertise in this matter. It is an oversimplification to say that the responsibilities of a broker are similar to that of a lawyer, or that a salesperson does not have a good deal more independence in operating than a law clerk is allowed. When I've bought and sold property in the past, my aunt, a licensed salesperson, usually handles the transaction at my end; I couldn't even tell you the name of the broker, except that it was handled by Coldwell Banker.

However, I should point out that clerks and paralegals have taken on an increasingly important role in law offices, one that he perhaps underestimates. I happen to practice in an area of law, bankruptcy, in which most of the heavy lifting in representing a client is done by paralegals. That area of law is particularly paper-intensive, so the responsibilities of obtaining information from clients, filling out forms, and arranging pleadings for filing are almost entirely done by non-professionals. The attorney's job has become focused on reviewing (and signing off on) the paperwork, meeting with the client at the initial stages of the case, and appearing in court when necessary.

In fact, in larger firms, some paralegals and clerks become even more important than the associates they assist. Because of the fact that, as far as clients are concerned, there is no distinction between lawyer and clerk, it is especially important for the lawyer to perform his supervisorial responsibilities. I believe that the earlier analogy remains apt, at least in this limited way.

June 22, 2005

An interesting factoid: the house just across the street from Rep. and Mrs. Cunningham was dumped for $905,000 in April, 2003, less than seven months before the San Diego-Area Congressman sold his condo for $1,675 million. What a market !!
War Crimes: Whom we are fighting. [link via Suburban Guerilla]

June 21, 2005

YBK [Part 6]: Bankruptcy filings were up 8% over the first quarter of 2005, an astonishing jump, since much of that period was before the public became aware of the new law. My own cursory examination of state records indicates that the totals were, in fact, down in the first two months (reflecting a two-year trend), so the jump in March must have been huge. As I have noted previously, the figures in April and May were even higher. If history holds, we should have a slight raw decline in June and July, so the next figures to come out will be crucial.
Why MZM does it:
“We can’t say too much about what we do,” MZM spokeswoman Karen Theobald said, “but we can talk about our employees.” Community involvement is a part of the company’s philosophy, carried out through charitable causes, social events and political donations. The firm prides itself on being “patriotic,” Theobald said. [emphasis added]
-Charlottesville[VA] Daily Progress, May 23, 2005, on the local philanthropic dynamo that is MZM.
YBK [Part 5]: Local blogger Mark Kleiman shorts the housing bubble. Our best local columnist, Michael Hiltzik, comments here.

In the interest of full disclosure, I, too, shorted the market three years ago, when I decided to cash in the equity in my Woodland Hills condo. The place had more than doubled in value over three years, we were supposedly on the verge then of a bankruptcy reform measure that would kill the economy, and I couldn't imagine that the bubble could last much longer....
Finally, some backing from his homies. Darrell Issa, whose vanity project in 2003 resulted in the election of a man whose idea of "education reform" is to spend $80 million on a special election this November to lengthen teacher tenure at public schools, has come to the defense of the Duke. Pointing his finger at the true malefactors, Issa focuses the blame where it belongs: at the Cunningham friend (and long-time contributor) who provided the comps doubling the value of his home, as well as the businessman whose cash purchase at that inflated price enabled the Congressman to buy a three-acre, $2.55 million spread in Rancho Santa Fe.

FWIW, Rep. Cunningham is the chief House sponsor of the amendment to ban flag burning.
This must be uncomfortable: Luanne Kittle, the wife of the editorial page editor for the San Diego Union-Tribune, has just become the Head of School at K-8 Rhoades, an independent school in Encinitas. The Director of the School is none other than Nancy Cunningham, wife of the Congressman and recent target of more than a few Union-Trib stories (see here, here, and here).

June 20, 2005

Among the politicians to receive the blessings of the largesse of Mitchell Wade, benefactor to San Diego Congressman Randy "Duke" Cunningham, is none other than Katherine Harris (R-FL), to the tune of $10,000 in the last election cycle (no word on whether she sold him a house as well), plus an additional $44,000 from officers, employees of his company, MZM, Inc. Apparently, his company, a DC-based military contractor, has also been very active in local Republican politics, says the San Diego Union-Tribune, with potentially illegal contributions being coerced out of employees to the company PAC.

UPDATE [6/21]: In fact, MZM was the largest single contributor to both Harris and Rep. Virgil Goode (R-VA) in the last election cycle (but, interestingly, not to Cunningham). A public watchdog filed a complaint today against MZM and Mitchell Wade with the F.E.C.
Did you know it's easier for both men and women to have orgasms when they're wearing socks? Explains everything....

June 19, 2005

Sideshow Bob? Perhaps the poorest-timed article in Slate since one of its pundits began a pool last January about how quickly Kerry would withdraw from the primaries.
The wonderful thing about the Golden Age in which we live is that so much information is now easily accessible to the public. If you are licensed to do anything by a state agency (or not, as the case may be), a few clicks with a mouse will provide you the basic data lickety-split.

And so it is with the family friend and retainer of Congressman Randy "Duke" Cunningham, Elizabeth Todd. Those of you who have visited Talking Points Memo recently may have heard the name in connection with her role in the mysterious sale of his home two years ago to a defense contractor, Mitchell Wade, on whose yacht the GOP Congressman lives while in Washington. As you may know, Mr. Wade purchased his friend's home, in a straight cash transaction, for $1.675 million; Mr. Wade then waited several months to resell the property for $975,000, a loss of almost 42%. Even in this inflated market, that whole transaction seemed rather unseemly. Ms. Todd provided the comps for the sale that are now under scrutiny by the FBI.

As the San Diego Union-Tribune pointed out a couple of days ago, Ms. Todd has been licensed by the state since April, 2002, and her subsequent sale of a home to Representative Cunningham the following year was her first-ever deal. But what the article only mentions in passing is that, in fact, Elizabeth Todd is not a licensed real estate broker, at least according to the state. She is a licensed salesperson.

The difference between the two licenses is enormous. A broker must have at least two years of real estate experience, take numorous college-level courses and pass a rigorous exam to be licensed. A salesperson, on the other hand, may have no experience, needs to pass only three courses and a relatively simple exam, but must work under the supervision of a broker in any deal in which she participates. In other words, her position is equivalent to that of a paralegal or clerk at a law office.

So anything she did concerning the sale of the original Cunningham manse, including providing comps, would have to be first vetted by someone else, a broker (state records indicate that she is employed by The Willis Allen Co., whose CEO, Andrew Nelson, contributed over $15 grand to GOP causes (incl. the Duke) in the last election cycle). Maybe that will exonerate her, but, in any event, the plot thickens....
The kerning, the kerning... In what may well be the silliest claim in the history of the blogosphere, we now have an assertion that the Downing Street Memo and related documents are forgeries. Why? Because the reporter in question (an employee of that infamous leftist America-basher, Rupert Murdoch) transcribed the copies of the originals he received, by way of an "old-fashioned typewriter", then destroyed the source documents to protect his source. Like Captain Queeg and his strawberries, the Bushies and their shills keep returning to the same meme, oblivious to the fact (as with the Rathergate docs) that the principals involved did not challenge their authenticity.

So is it a big deal? According to the blogger who "broke" this story, Captain's Quarters,
...a lack of protest from Downing Street after being asked to authenticate retyped copies of alleged minutes of secret meetings does NOT constitute verification. The same exact argument came up with the Killian memos in Rathergate and the Newsweek Qu'ran-flushing report last month. In both cases, the documents or sources turned out to be fakes. It's the reporters' job to provide verification, not simply a demurral by officials to opine on their authenticity. If that isn't obvious, then centuries of evidentiary procedure in American and English common law have gone for naught, as well as traditions of journalistic responsibility and professionalism. After all, this argument just means that reporters can type out anything they like and the burden of proof shifts from the accuser to the accused in proving them false -- hardly the process endorsed in libel and slander cases in the US, at least. [emphasis added]
It should be obvious why that argument doesn't hold water. The legal standards in a civil or criminal case must necessarily be more stringent than the standards the rest of society uses in its daily life. To hold someone liable for a tort such as defamation, or to convict a person of a crime, we require that the rules of evidence be more strict and exacting. Such things as the Hearsay Rule, the Best Evidence Rule, and the presumption of innocence burden trial attorneys in order to lessen the possibility that the wrong person gets convicted.

But those aren't the standards the rest of us live by. Michael Jackson should be presumed innocent by his jurors when he's being tried by the state for pedophilia, but that's not the standard a mother of a twelve-year old should use when deciding whether to let her son attend a sleepover at the Neverland Ranch. If Tony Blair ever is indicted for war crimes, or if Congress moves to impeach Bush based on the DSM, than of course the originals must be introduced as evidence (that is, if Bush or his English bitch ever decide to challenge their authenticity), and any hearsay issues will have to be dealt with by the prosecution. But that doesn't mean the rest of us have to give them a free pass in the meantime. [link via Kevin Drum]