Category Archives: regulation

Another Out of Control Agency

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…that’s overcome with its own self-importance.  I’ve written before about how the Securities and Exchange System abuses its own system of in-house judges for SEC purposes rather than for the public’s interest.

The Federal Trade Commission is another such agency that’s showing it’s outlived its usefulness and for the same reason.  In 2008, LabMD was “found” to have inadvertently exposed a file containing personally identifiable patient information.  I write “found” because the company that “found” the exposure then tried to use their discovery to peddle its data security services to LabMD.  The FTC brought a case against LabMD over the exposure, but last year an FTC in-house judge ruled against the FTC and tossed the case.

That judge, D Michael Chapell, tossed the FTC’s case last year because the commission could not identify any consumers who’d been harmed by LabMD’s allegedly weak security practices. Because no one had been harmed in the seven years since the patient file was exposed, it was unlikely that anyone would be harmed in the future, Judge Chappell concluded.

Wrong answer, Judge.

The FTC, which has the authority to review the rulings issued by its administrative court, said Friday the judge used an incorrect legal standard that was too stringent.

The ruling, being inconvenient to the FTC’s narrative, was rejected out of hand.

Here is the usefulness of an in-house system of judges.

The Other Supreme Court That’s in the Election Balance

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This one is the National Labor Relations Board, a Democrat/union-dominated entity that is nearly the last word on what employers are allowed and required to do.

It’s the NLRB that threatened Boeing with labor unrest expensive lawsuits for its effrontery in wanting to build an aircraft manufacturing plant in the right-to-work state of South Carolina and forced Boeing to keep primary manufacturing in the union state of Washington.

It’s the NLRB that decided that franchise employees actually are jointly employed by the franchise—a McDonald’s burger joint, for instance—and the franchisor—McDonald’s corporate headquarters, for instance—a complete rewrite of the prior NLRB view of franchise employment.

It’s the NLRB that keeps pushing for card-checks at union elections whose purpose is to have the employees decide whether they want a union to represent them, a move designed solely to eliminate heretofore secret ballots in those elections.

It’s the NLRB that has pushed through, regarding those elections, the right of unions to demand an election within 30 days of the start of their public efforts to “organize” a company but without the company’s opportunity to respond in those 30 days—or even to begin to respond to the unions’ non-public efforts to organize.

It’s the NLRB that pushed through its “Persuader” Rule which requires employers to identify publicly all sources of consultation or advice the employer might have contacted—however peripherally—for thoughts on how to deal with unions.

The list goes on.  And on.

The NLRB already is dominated by a Democrat/union majority, and it will only get worse with a Democratic Party President and a Democratic Party-owned Senate making the appointments to the five-member board.

Labor Costs Up, Prices Up

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Starbucks is sharply raising its total compensation for its employees in the Seattle area.  Total compensation from wages and stock options is going up some 5% to 15%.  Carefully buried in the very last paragraph of The Seattle Times piece is this little nugget:

Last July, Starbucks raised its prices 3.5 times as much in Seattle as in the rest of the country.  It raised the price of its typical coffeeshop purchase across the U.S. by 1%, but in Seattle by 3.5%.

Hmm….

Need More Regulation

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That’s the meme of Federal Reserve Board Governor Daniel Turillo, the Fed’s reputed point man for regulation.  Turillo is claiming that

the lessons of the 2008 financial crisis won’t be complete without better regulation of short-term funding both inside and outside the banking system.

Naturally, the regulatory point man is going to see everything as a regulatory need.

OK, since more regulations are the solution, here’s a suggestion.

How about some regulations prohibiting the Federal government and the Federal Reserve Bank from using credit and lending as social engineering tools?

State Department Insecurity

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Regardless of what one might think about the FBI’s decision to let ex-Secretary of State and Democratic Party Presidential nominee Hillary Clinton escape prosecution over her handling of State Department emails on her unsecured personal email server, you’d think the hoo-raw over the matter for all this time at least would prompt State to take seriously Department handling of emails.

You’d think wrong.

State’s Inspector General has issued a report that, in its totality, shows that the State Department just doesn’t care about national secrets, to the point of not even troubling itself to shut down unused email accounts.  This despite repeated “suggestions” that they do just that.

The report, titled Management Assistance Report: Inactive Accounts Within the Department of State’s Active Directory, has this in its opening paragraphs.

Acting on behalf of the Office of Inspector General (OIG), Office of Audits, Williams, Adley & Company-DC, LLP (Williams Adley), an independent public accounting firm, evaluated whether the Department disabled inactive AD user accounts in accordance with its internal policies.  …  The Department’s AD account policy states that Department officials should disable inactive user accounts after 90 or more days.

Nope.

Of the 40,794 domestic AD accounts tested for this audit, Williams Adley found 2,601 (6.4%) had not been disabled after 90 days of inactivity. Of the 2,601 inactive accounts, 1,932 (74%) accounts were inactive for more than 1 year….

This has been an ongoing passive-aggressive resistance problem [SBU means “Sensitive but Unclassified;” its line-out in the original means the indicated paragraph has been completely declassified so the public can see it].

(SBU) OIG reported a similar deficiency in its FY 2015 Federal Information Security Management Act audit report.

And

(SBU) In its 2014 report on AD, OIG stated that the deficiencies it identified with AD Rights Management primarily occurred because IRM had not established a governance structure or strategy to ensure that AD Rights Management was implemented and managed consistently.

The report concludes with these two tidbits tied back to an earlier recommendation [Emphasis within the paragraphs added by me.]

Recommendation 1: (SBU) OIG recommends that the Bureau of Information Resource Management amend the “Program Management Plan for PIV Login to OpenNet Deployment” to address the identification and removal process of mailbox, service, and terminated user accounts.

Management Response (April 2016): (SBU) IRM non-concurs with this recommendation. The Program Management Plan for PIV Login was created to deploy and implement PIV domestically and overseas. Now that IRM has completed that goal, the plan has been completed and does not lend itself to amendment.

In other words, State considers complying—to set out instructions for complete removal of these accounts—to be too much like work.

Recommendation 2: (SBU) OIG recommends that the Bureau of Information Resource Management implement the new guidance from the “Program Management Plan for PIV Login to OpenNet Deployment,” once amended in response to Recommendation 1 of this report.

Management Response (April 2016): (SBU) IRM non-concurs with this recommendation. The Program Management Plan for PIV Login was created to deploy and implement PIV domestically and overseas. Now that IRM has completed that goal, the plan has been completed and does not lend itself to amendment.

Again, that’s just too much like work.

The State Department needs a complete housecleaning, including a complete turnover of non-Foreign Service personnel.

Elections have consequences.