You Don't Want to Know What Happens When You Piss Off the Notary Publics

Amity Shlaes uncovers a lesser known anti-business move by the Obama administration, begins the long process of rediscovering Warren G. Harding's greatness, and upholds the sanctity of contracts in her Bloomberg column.

At issue: the president's unheralded pocket veto of the unheralded Interstate Recognition of Notarizations Act, which would have required courts to recognize notarized documents signed in other states.

There are good reasons to object to IRNA, but the administration managed to find the bad one. According to White House spokesman Robert Gibbs, Obama wants to increase the paperwork headaches involved in foreclosing on bad borrowers, and says the bill could create “unintended consequences on consumer protections.”

Shlaes takes the wayback machine to the 1920s, and shows how prosperity presidents steer clear of the high-handed approach to contract law the Bush and Obama administrations have taken:

Harding well understood the importance of stability for commerce and contracts. In his inaugural address, Harding promised the country a predictable environment for business deals in language far different from the current political discourse: “Any wild experiment,” Harding warned, “will only add to the confusion.”

There was no “change” in the Harding plan. “Our best assurance,” he said, “lies in efficient administration of the current system.”

[...]

Once president, Coolidge repeatedly made sure that contracts and property were honored. Coolidge did this first of all by keeping government out of the way and curtailing government expansion. His favorite vehicle for blocking Congressional plots was the one that President Obama used: the pocket veto, when a president vetoes legislation by allowing it to go into a Congressional recess unsigned.

Coolidge likewise denied bailouts when he could, sometimes in a manner that would appall today. The Greece of those days was Germany, which had been forced into a horrendously unrealistic reparations contract: the Versailles Treaty. Germany’s terms were rewritten, but Coolidge was skeptical.

As Time magazine reported, Coolidge said of the agonizing Germans: “They hired the money, didn’t they?” Time commented: “He did not want the U.S. taxpayer to cover German reparations.” Banks failed routinely in the 1920s, and by the thousands. As for the dollar, the Fed and Treasury of those years protected it so well that Cole Porter included these lines in a famous song: “You’re the top. You’re an arrow collar. You’re the top. You’re a Coolidge dollar.”

The result of this callous inhumanity was highly humane: The economy grew an average of more than 3 percent a year -- 4 percent or more under Coolidge. Unemployment fell below 5 percent and stayed there.

So, sure, contracts may be necessary casualties in recessions. Still, it’s possible that ours has been a contracts recession.

Shlaes' big idea is that political uncertainty acts as a depressant on economic growth. While I suspect emotions-based economic theories eventually lead to the Keynesian cesspool, this is a case where the depressive effects are clear. Banks' internal investigations of paperwork screwups have already caused a de facto national foreclosure moratorium. The issue in foreclosuregate isn't that there was something wrong with notarized documents but that lenders and borrowers both may have failed in their due diligence. That's something a notary -- who is just there to make sure of who is signing the documents -- wouldn't catch. Notarization isn't a guarantee against fraud by the signers. Creating new uncertainty around signed contracts makes the mess harder to sort out and dishonors the brave notary publics who are risking their lives for our freedom.

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  • ||

    My mother, a bank teller, was a notary.

    As I repeatedly* learned growing up, you did not want to piss her off. I'm not sure if her being a notary public had anything to do with that, but it is a data point. ;-)

    * I was a bit slow back then.

  • ||

    Paperwork screwups, huh? You know what solves those? Yup, you guessed it: more paperwork.

  • Cliché Bandit||

    you need the blue rescuing princess form.

  • ||

    Hey, there's nothing that Obama can't micromanage, right?

  • Old Mexican||

    OMG, that's Laura Ingraham's long lost sister!

    http://politihack.files.wordpr.....am-b37.jpg

  • ||

    Kind of is. Why do conservative writers usually cute and liberals look like Rachel Maddow

  • ||

    What are you trying to say?

  • Old Mexican||

  • Old Mexican||

    Re: John,

    Why do conservative writers usually cute and liberals look like Rachel Maddow[.]

    The lib women's poster should be printed in glossy paper to place outside your house to scare children on Halloween.

    http://www.moonbattery.com/arc.....ve_vs.html

  • ||

    Notice Bo Derek at the top of the Conservative list? At one of the Republican National Conventions this decade, can't remember which, she spoke about her personal experience with free trade and it's positive effect in the third world. She was quite eloquent and also still smoking hot.

  • Ron L||

    "The lib women's poster should be printed in glossy paper to place outside your house to scare children on Halloween."

    And you missed that hag Pelosi!? That woman could scare a lump of concrete.

  • Juice||

    Laura Bush?

  • BakedPenguin||

    And that's a bad picture of Malkin. Personally, I think she's usually full of shit, but she is definitely attractive.

  • ||

    Nah, Amity is cuter and way more fun. Ask her kids.

  • Old Mexican||

    But who has the better legs??

    Ahhhh!

  • ||

    I want to hear a version of "Modesty Plays" by Sparks entitled "Amity Shlaes." It scans!

  • ||

    The original.

    Modesty Plays Modesty Plays
    Modesty Plays Modesty Plays

    She may like caviar and cocktails
    She may like symphonies and sun
    But underneath the gown and high heels
    She's like a fully loaded gun

    Modesty Plays Modesty Plays
    Modesty Plays Modesty Plays

    The world is running out of heroes
    The world is running out of time
    Where are those martial arts maneuvers
    We're getting massacred by crime

    Well listen buddy don't you worry
    She may not look like Genghis Khan
    And she may talk about her manicure
    But she can sure get things done

    Modesty Plays Modesty Plays
    Modesty Plays Modesty Plays

    Don't underestimate the lady
    She may seem cultured and demure
    But there's another side, and careful
    She'll hit you like a 2x4

    The world is running out of heroes
    And everybody's out on bail
    As long as Modesty is on our side
    Good will surely prevail

    Modesty Plays Modesty Plays
    Modesty Plays Modesty Plays

  • Spiny Norman||

    As for the dollar, the Fed and Treasury of those years protected it so well that Cole Porter included these lines in a famous song: "You’re the top. You’re an arrow collar. You’re the top. You’re a Coolidge dollar."

    We're getting those again! They're scheduled for 2014. Those will be some good times.

  • ||

    You know, maybe we should let the notaries run the country. Couldn't do any worse than the assholes in DC, and they have the added benefit of being decentralized.

  • Juice||

    William Buckley said, "I would rather be ruled by the first 200 names in the Cambridge phone book than by the faculty of Harvard Law School."

  • Invisible Finger||

    What possible problems could arise from robo-notarizations?

  • Steven Smith||

    She really brings on the stupid here. She seems to oppose Obama's veto of the bill either because Coolidge was sworn in by a notary, or that it might lead to "disrespect" of contracts, neither of which have anything to do with the merits/demerits of the actual legislation, which would have relaxed notarization standards nationwide to the lowest common denominator. She may be dumb enough to teach at George Mason.

  • shrike||

    Its the alternate universe of right-wing Creationist "truthiness".

  • Old Mexican||

    "Creationist"?

  • shrike||

    Conservatism = a simplistic mindstate where everything is explained by the supernatural and/or their snake-oil hucksters.

  • ||

    I guess that would explain all of the conservative and libertarian atheists out there. God you are stupid Shrike. And not in a funny Steve Smith kind of way. In a really scary, I hope this guy is on some kind of medication way.

  • Old Mexican||

    Re: shrike,

    Conservatism = a simplistic mindstate where everything is explained by the supernatural and/or their snake-oil hucksters.

    That explains someone like S.E. Cupp.

    No, wait . . . it doesn't. And a theory that cannot explain all the evidence is a flawed theory, so no cigar this time, shrike.

    Dumbass.

  • Mr. FIFY||

    Hold on, OM... shrike, here, single-handedly saved our economy with "PEP"!

  • Ron L||

    shrike|10.13.10 @ 6:16PM|#
    "Conservatism = a simplistic mindstate..."

    shrike = brain-dead ignoramus.

  • JoshINHB||

    "Conservatism = a simplistic mindstate where everything is explained by the supernatural and/or their snake-oil hucksters."

    Wait a minute,

    are you saying that Obamanomics are really conservative?

  • Mr. FIFY||

    None of which have anything to do with notarization, shrike.

  • ||

    STEVE(N) SMITH LIKE THIS "SHRIEK"! HE SAY FUNNY THINGS THAT MAKE NO SENSE! MAKE STEVE LAUGH! STEVE RAPE HIM LAST!

  • Colin||

    +1

  • shriek||

    Fuck you, asshole! Rape me first! My windows will be unlocked tonight, btw. Just tossing that out there.

  • ||

    Which is more likely to happen, someone fraudulently using a notary or a deadbeat getting out of a debt because the bank has a document that was notarized in another state? It is the latter. When you make it easier for people to get out of debts you make loans harder to get and everyone poorer.

    As always Steve, no one brings the stupid quite like you do.

  • Tim Cavanaugh||

    Me go out on limb and defend Steve Smith a little bit. There is a states' rights issue here. If North Carolina wants to institute a higher burden of proof than South Carolina, I don't know that D.C. should be blocking that.

    The problem is that you can't address the (possible) problem of faulty documentation by pretending there's an epidemic of rogue notarizations. The problem today is what it's been since the beginning of the century -- careless documentation by borrowers and lenders. Notarization just verifies who signed the carelessly made documents.

    And by the way, when is foreclosuregate going to cough up an actual case of somebody who was current on his or her mortgage and got falsely put into default? Funny how you haven't heard about any of those.

  • Some Guy||

    And by the way, when is foreclosuregate going to cough up an actual case of somebody who was current on his or her mortgage and got falsely put into default? Funny how you haven't heard about any of those.

    There have been a lot lately.

    http://www.businessweek.com/ne.....olner.html

  • johnl||

    I actually got an NOD a few years ago from the the rocket scientists at GMAC. This happens but I don't see how a 100% made in California notarization would have made any difference.

  • ||

    STEVE(N) APPRECIATE TIM DEFENSE! WILL RAPE TIM LAST, AFTER EVEN SHRIEK AND SULLY! MAYBE STEVE EVEN RAPE WITH LOVE!

  • Fatty Bolger||

    Sully!

    Matrix: Remember, Sully, when I promised to kill you last?

    Sully: That's right, Matrix! You did!

    Matrix: I lied.

  • Steven Smith||

    The problem is that you can't address the (possible) problem of faulty documentation by pretending there's an epidemic of rogue notarizations. The problem today is what it's been since the beginning of the century -- careless documentation by borrowers and lenders. Notarization just verifies who signed the carelessly made documents.

    That is why you don't want to have a national notarization standard that favors the least stringent burden of proof. The most troubling cases I see are where notaries are ok'ing assignments of mortgages well after the date they were purportedly signed, in some cases several years after. This is done to permit the party seeking to foreclose the ability to claim standing by having received the assignment from the original beneficiary, whether it was MERS or some shadowy, long-defunct lender.

    However, there may have been (and usually are) many transfers of the note that actually preceded that assignment, creating a reasonable doubt that the party claiming a right to foreclose has a clear chain of title. Thus, the bogus notarization of the assignment allows the lender to purportedly create such a chain of title by signing a document that was created almost immediately after the initial loan agreement was made, but for which all the other information (such as who the assignee is) was left blank. Lax notarization laws enable precisely the sort of careless documentation you decry.

  • Tim Cavanaugh||

    I don't disagree.

  • Some Guy||

    Deadbeats getting out of debts still requires epic incompetence on the part of the lender. Whereas this law would have significantly increased the amount of foreclosure proceedings against houses that have a paid up mortgage, or none at all.

    If the banks (and really, it's only a handful of highly dysfunctional parasite banks that are having these problems) are saying they are too stupid to follow the laws as written, I don't see why we should just repeal those laws and make it easier for them to screw up people's lives without cause.

  • shrike||

    See this - you don't get it.

    This is a conservative gallery and the rule of law is subservient to property claims.

    Conservatives hate the fucking Constitution - they tell you every day.

    they hate all these amemdments ---

    4th (illegal search and privacy rights)
    14th (birthright citizens)
    16th (direct taxes)
    17th (election of Senators)
    24th (poll tax elimination)
    1st (Establishment Clause)
    5th (eminent domain)
    6th (due process)

    get it?

    But those fuckers loves them some 2nd Amendment! (so do I, by the way - I just like the whole fucking document).

  • ||

    STEVE SMITH RAPE SHRIEK IN EAR MANY TIMES! THAT WHY HE NEVER LISTEN TO ANYTHING BUT VOICES IN OWN HEAD!

  • shrike||

    You can't defend conservatism, can you?

    Mike Huckerbee awaits your vote.

  • ||

    Why would I want to defend conservatism, you retarded spastic moron?

    How much meth do you do in a day, anyway? Would you say "incredible" amounts, or "heroic" amounts? Maybe "Val Kilmer in The Salton Sea" amounts?

  • MNG||

    Heroic amounts of meth. Now that is funny.

  • BakedPenguin||

    Remember how much Walter White sold to the restaurant owner? I thinking that much.

  • ||

    I stopped after Season 1. Maybe I should go back to it.

  • BakedPenguin||

    It's a decent show, but considering all of the elements, I can't help but think it's missing something. Of course, I haven't seen it in a while.

    BTW, it was something like 5 pounds.

  • Ron L||

    shrike|10.13.10 @ 8:09PM|#
    "You can't defend conservatism, can you?"

    I can, but not to those willfully ignorant. Your sort of stupidity is beyond any cure.

  • MNG||

    I can see shrike's point. Modern day conservatism in the United States seems to hold a strong attachment to fundamentalists. Pointing to the odd conservative who is an atheist or skeptic doesn't undercut his point much.

  • Ron L||

    MNG|10.13.10 @ 9:21PM|#
    "I can see shrike's point. Modern day conservatism in the United States seems to hold a strong attachment to fundamentalists."
    Cite, please.

  • MNG||

    What kind of a pedantic idiot needs a citation for the assertion that fundamentalists are attracted to moder day conservatism? Next you will need a citation for the sky being blue.

    Oh well, here is your shut up for the night, it took like 30 seconds to find.

    http://www.gallup.com/poll/142.....gious.aspx

  • MNG||

  • Mr. FIFY||

    Still not clear what shrike's argument is here, as the topic is "notaries".

  • Mr. FIFY||

    What's to like about the 16th Amendment?

    As for eminent domain, liberals are the ones who seem not to give a fuck about private-property rights, shrike.

    But what the fuck do you know? You stood up for the health-care mandate, so why should we listen to you?

  • ||

    So Shriek is more conservative than conservatives. Self-hate much?

  • Fatty Bolger||

    That's bullshit, of course, but who says you have to "like" every amendment, anyway? That's just stupid. You can dislike the 2nd amendment, and at the same time realize that it allows people to have guns regardless of your personal opinion.

  • STEVE SMITH||

    STEVE SMITH NEED RAPES NOTARIZED. CANT FIND STAMP WITH RAPE WRITTEN ON IT.

  • The Ghost of Juvenal||

    Who will notarize the notaries?

  • Fatty Bolger||

    Another notary, of course.

  • ||

    Yesterday's WSJ printed a part of Madison's federalist paper #62 which pretty much says it all on this.

  • ||

  • ||

    Of course, Obama knows this and uses it every day.

  • Juice||

    Also from Federalist 62:

    The mutability in the public councils arising from a rapid succession of new members, however qualified they may be, points out, in the strongest manner, the necessity of some stable institution in the government. Every new election in the States is found to change one half of the representatives. From this change of men must proceed a change of opinions; and from a change of opinions, a change of measures.

    Oh! How times have changed. If only we could have this again!

  • Old Mexican||

    Notarization isn't a guarantee against fraud by the signers.

    But . . . who would want to live in a world of such uncertainty? We all need to be in a veritable jail, just like "Chony" wants.

  • Old Mexican||

    Obviously, the answer is that practicing due diligence and not being dumb should be the norm.

  • dfd||

    Coolidge said of the agonizing Germans: “They hired the money, didn’t they?”

    That makes absolutely no sense. Clearly the Germans didn't "hire" the money they were being asked to pay; reparations were being imposed as a penalty by the victorious Allies. Coolidge actually said that about attempts by the British and French to renegotiate and reduce their war debts to the US.

    There is a connection, but it is a bit more indirect. The US was largely against reparations and wanted the British, and especially the French, to reduce their demands on Germany. However, the British and French claimed they couldn't afford to pay their war debt to the US if they couldn't collect reparations from Germany. They said any reduction in reparations should be met with a reduction in their debts to the US. The US was adamantly opposed to any linking of reparations with war debts, claiming the latter was a simple contract and had nothing to do with any punitive measures the Allies had chosen to impose, leading to Coolidge's quip.

  • ||

    And the US would have been totally fucking right.

    The British and French attitude seems do be as if the assumption was that our healping them meant we got a cut of the "spoils". Which reveals them to have the mindset of a bunch of medieval warlords.

  • ||

    Hear any European talk about war and thats EXACTLY what it sounds like.

  • ||

    I am waiting for the moment when Obama announces that increasing paperwork requirements is a good idea, because of the number of highly paid administrative jobs it will create.

  • JoshINHB||

    Pencil ready jobs?

  • Mr. FIFY||

    The 1099 requirements in the health-care bill fit that description, Hazel.

  • Fatty Bolger||

    They constantly push new requirements to the banks now, on a weekly or even daily basis. It doesn't even require new law.

  • EscapedWestOfTheBigMuddy||

    You Don't Want to Know What Happens When You Piss Off the Notary Publics

    ...but it must leave a real impression.

    ::rim shot::

    I'll be here all week.

  • Juice||

    The banks need to learn a lesson here (ok, stop laughing) and that is to be more effing careful with your paperwork.

  • Ben||

    You know I thought the plural of notary public was "notaries public".

  • Attorneys General||

    No.

  • Attorney Generals||

    You sure about that Bub?

  • Joe M||

    Minor threadjack. This seems somewhat important:

    Man who police stunned with Taser dies

  • Ted S.||

    "Foreclosuregate"?

    [reaches through computer screen and strangles Tim for his idiotic use of the fucking -gate suffix]

  • EscapedWestOfTheBigMuddy||

    gateificationgate?

  • Jason||

    -Gategate?

  • Mo||

    Wouldn't respecting contract law force the banks to play under the rules as written during the contract as opposed to trying to have Congress change the rules of the game because you fucked up? Look, a lot of banks were lax in their lending documentation because they didn't think they'd have to chase down this many foreclosures at the same time.

    The banks know the notary laws in the states that they operate and only try to get around them when they know they have no case.

  • Ron L||

    Mo|10.13.10 @ 8:53PM|#
    "Wouldn't respecting contract law force the banks to play under the rules as written during the contract as opposed to trying to have Congress change the rules of the game because you fucked up?"

    Not if someone screams "IT'S FOR THE CHILDRUN!"
    Or Obama decides that he dislikes certain contracts.

  • MNG||

    "a lot of banks were lax in their lending documentation because they didn't think they'd have to chase down this many foreclosures at the same time."

    Give it time Mo, I'm sure we'll soon be hearing that Freddie and Fannie caused all of that. Or the CRA or something...

  • Ron L||

    MNG|10.13.10 @ 9:19PM|#
    "I'm sure we'll soon be hearing that Freddie and Fannie caused all of that."

    Of course not! A government-backed buyer of funny paper wouldn't ever increase the selling of funny paper, would it?
    What color is the sun your planet revolves around?

  • Fatty Bolger||

    Wouldn't respecting contract law force the banks to play under the rules as written during the contract as opposed to trying to have Congress change the rules of the game because you fucked up?

    Yes, that would be best. The mortgage servicers (and the lawyers they use) understand state requirements for foreclosure very well. They know how to fix this.

    While we're at it, though, can we get the federal government out of most of the bank and lending business? FDIC seems like a good idea, but the rest we don't need.

  • ||

    It's good to one know well if you have a problem with a car title.

  • MNG||

    Same the true is for English teachers if you have a proble with grammar.

  • ||

    MNG has never switched the position of two adjacent words in a sentence. If he does, we should recommend he take the third grade again.

  • MNG||

    "“He did not want the U.S. taxpayer to cover German reparations.”"

    Yeah, that shit worked out really well didn't it! I mean, it wasn't like WWII didn't cost way more than helping stabilize Germany would have, and didn't result in all kinds of screwed up assaults on liberty! Way to go Silent Cal!

    WTF?

  • BakedPenguin||

    Yeah, Coolidge was way more to blame for that than Wilson.

  • MNG||

    Er, Baked, Wilson pushed for much more concilatory terms for Germany at Versailles. It was the other allies that pushed the tough conditions on the Kaiserland...

  • BakedPenguin||

    Initially. Wilson then relented to the tougher conditions the French and the British wanted. (George agreed w/ Wilson, however, he wanted to be re-elected, so he demanded tough conditions). All so Wilson could have the League of Nations, which the US (wisely) did not join.

  • Ron L||

    MNG|10.13.10 @ 9:17PM|#
    "...I mean, it wasn't like WWII didn't cost way more than helping stabilize Germany would have,.."

    A true master of the false dilemma right here!
    Schacht pretty much called your bluff and Chamberlain would be proud of you!

  • ||

    I thought this law was all about papering over the robosigning scandal.

  • ||

    Notarization isn't a guarantee against fraud by the signers.

    It depends. Sometimes the notary is merely affirming that the named person signed it in their presence on a given date. Sometimes the notary actually administers an oath.

    This was about papering over the robo-signing problem. Obama did the right thing in vetoing it. There are likely an enormous number of mortgages that were never properly assigned after being issued. That resulted in actual, outright fraud on the buyers of mortgage-backed securities, regardless of whether the mortgages actually go into default and need to be foreclosed.

    That is the real problem. Now that the AGs have their meathooks on this and will do the discovery, expect the institutional buyers of these fraudulent securities to pile on. Many of these buyers were pension plans, BTW, so if you only care about legal issues when they affect po' folk, there you go.

    The notary bill would have made it much easier for the perpetrators of this fraud to cover their tracks. Good veto by Obama, says I.

  • Jason||

    While I suspect emotions-based economic theories eventually lead to the Keynesian cesspool, this is a case where the depressive effects are clear.

    Wait, isn't Austrian Economics also called the Psychological School? The one where the theory of value is based on a person's subjective or emotional evaluation of goods?

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