Blanchard on the Jensen Prosecution

Bill Lueders:

cBride, in her post, goes on to challenge the Jensen prosecution on grounds of cost: “I’d be willing to bet that the prosecution cost the taxpayers more money than the supposedly illegal campaigning did. That would be a great question for the media to ask the Dane County DA: Mr. Blanchard, what was the bill?”

Well, as Woody Allen says in Annie Hall, it so happens that we have Marshall McLuhan right here.

“Ms. McBride is wrong on the comparison of costs,” writes Blanchard in response to an e-mail from Isthmus. (Hmm, why didn’t McBride, a former reporter, think to try this?) “Easily many millions of dollars in public money are not currently being spent – and will not be spent in the foreseeable future – on anything resembling the large partisan caucus offices that Republican and Democratic legislators alike used in recent years to run private campaigns.

KPMG Tax Shelters: Judge Criticizes Prosecutors Case

Yesterday’s hearing in the complex KPMG tax shelter case brought about some interesting discussions:

  • Reuters:

    A federal judge accused prosecutors Thursday of overreaching in their attempt to show that former KPMG executives sold questionable tax shelters to wealthy clients.

    Lawyers involved in the case expect U.S. District Judge Lewis Kaplan to reject defendants’ calls to dismiss the case.

    The New York judge, however, faulted what he called the government’s “shameful” activity that led the accounting firm not to pay defendants’ legal bills, contrary to past practice. He also suggested that prosecutors drop some lesser counts.

  • Lynnley Browning:

    A federal judge raised questions yesterday about the prosecution of 16 former KPMG employees over aggressive tax shelters, criticizing prosecutors for what he called murky definitions of fraud and evasion.

    The judge, Lewis A. Kaplan of Federal District Court in Manhattan, said he was confused by what prosecutors said was a conspiracy by the defendants to make and sell aggressive shelters that allowed hundreds of wealthy investors to evade $2.5 billion in taxes from 1996 to 2002.

    “Frankly, I’m very bothered by it,” the judge said, saying the document “puts the government’s thumb on the scales” and raises questions about the Sixth Amendment constitutional right to legal representation.

    No court has ruled the shelters illegal, but the I.R.S. has never considered them valid for deductions.

    Nonetheless, Steven Bauer, a lawyer who represents John Larson, a former KPMG partner who is one of the 18 defendants, said prosecutors had withheld important information detailing, among other things, debate inside the I.R.S. over whether the shelters were legitimate.

    Judge Kaplan ordered the prosecution to turn over any withheld information.

Fill Your Tank With Vegetable Oil

Jim Washburn:

One day last year, my musician friend Jonathan drove up in a Mercedes. This was odd, since Jonathan is so resolutely counterculture that he once tried recording an album in the woods, without electricity.

His car’s exhaust smelled faintly of french fries, and therein lay the explanation: The new Jonathan Richman tour vehicle — an ’84 300D Turbo — was running on vegetable oil-derived biodiesel fuel as he and his drummer crisscrossed the nation in it, a deep fryer on wheels.

I was intrigued: Biodiesel comes from renewable resources. It’s made from soybeans, corn or other oil crops, saving America’s farmers. Or it comes from recycled kitchen grease, saving America’s sewers. It pollutes remarkably less than petroleum fuel, and could potentially make the U.S. energy self-sufficient, freed from bargaining with dictators and terror-sponsor states.

Google’s WiFi Privacy Ploy

John McMullen:

What this means is that Google and Earthlink plan to use online files (known as cookies) and other data-collection techniques to profile users and deliver precise, personalized advertising as they surf the Internet. (Earthlink is working with the interactive ad company DoubleClick, which collects and analyzes enormous amounts of information online to engage in individual interactive ad targeting.)

Not everyone is enthused by the Google/Earthlink model. San Francisco was advised by a trio of privacy advocates to develop policies that would respect personal privacy. In letters to the city, the ACLU of Northern California, the Electronic Frontier Foundation and the Electronic Privacy Information Center (EPIC) urged the adoption of a “gold standard” for data privacy (pasted in below from, insuring that its Wi-Fi system would “accommodate the individual’s right to communicate anonymously and pseudonymously.” The groups also suggested that the city require any Wi-Fi company to allow users to “opt in” to any data-collection scheme. [Full disclosure: I rent office space in Washington, DC, from EPIC].

The Real US Broadband Problem

Maynard Handley writes:

The issue of importance is not the cost of broadband; that is higher than it should be in the US, but it will fall.
Neither is the issue of importance the speed. Higher speed is nice, but what’s available in the US is adequate for now.

What is important is the extent to which home users on the internet are empowered:
Do their terms of service allow them to run their own web pages off their home machines? Can they run personal blogs and wikis for their friends to visit? Can they log into their home machines from somewhere else? And so on.

The common place TOS in the US prevent such activities; the powers that be in the US are interested in making the US an alternative form of television, and very much a one-way medium. Not only is this profoundly immoral, it is profoundly undemocratic, and profoundly stupid (since it is yet one more attempt to freeze an existing business model rather than looking at the big picture of how to take advantage of new, as yet undreamed of possibilities); but of course, this sort of trifecta is about what one expects from US business these days.

The point of my writing is to express my disappointment that these issues were not raised; either in the context of the US or in the context of France. I would like to hope that French companies are being better citizens about this than their US counterparts, but I have no reason to believe so. I would, however, hope that a newspaper article would include at least some nod to issues more important than saving a few bucks on one’s cable bill.

Yours sincerely,

Maynard Handley

Handley is correct. is a very small attempt to address some of these issues.

Google’s $2Billion Stock Sale


It must want to buy something. No other conceivable explanation jumps to mind for why a cash-gushing monster with an $8 billion war chest would toss away another 5 million shares in tonight’s shelf filing.

Scheduled 2006 big ticket items are $1 billion to AOL for the search deal, $1 billion (rumored) to Dell for the Google Pack deal, and $1-$2 billion for capex, all offset by an estimated $2-$3 billion of positive cash flow. Add that together and you get a net 2006 cash outflow of maybe $1 billion, leaving $7 billion on the balance sheet–more than enough to compete with anyone except…