The Modern Democracy and The American Common Law

How do we reconcile traditional English common law principles of certainty and predictability in the law with American principles of fair and just judicial review at law and equity? Our American system of three branches of separate powers accords with the adversarial legal system of seeking impartial and objective judicial opinions. Neither the President nor the legislature imparts undue influence over the judiciary.

May we continue to ensure this unique type of good government in light of the size of the American population in current times resulting from, among many causes: modern technology and an increase in residential land ownership?  With greater access to education and information throughout the states and territories, the informal and unintended influence of the majority upon government is much greater than at the time of the adoption of the U.S. Constitution.

This debate requires a renewed inquiry into the dual purposes of American law in both resolving adversarial conflicts and in guaranteeing that the law achieves agreed upon social ends. Our community incrementally overtime determines our “ideas” and our “truths.”

 In this way, our Judge-made law fills the niches left by statute and executive policy (or one might say agency regulation).  The common law in America is derived from the public. From this our judges glean.

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Economic Equality in America

Some logic and rationality must be accorded to an aged old portion of the American economy that eventually equated Hollywood celebrities and major league professional ball players with millionaire railroad tycoons and corporate barons. Initially, the musicians, singers, actors, actresses, as well as players of baseball, basketball, football and hockey, were the heroes of blue-collar, working class America. They were those the hourly wage earner and family could look up to when education, books, newspapers and magazines were as beyond reach as a college education. Today, vocational and four-year colleges extend coast-to-coast. And, cable television and the Internet bring news regarding the facts and events of America and the world to all, regardless of level of education.

So, why the socio-economic divide between celebrities and our governmental, private and public leaders and academics? Is equal treatment something their America cannot afford?

America requires that economic power be, in formation and distribution, determined by performance and quality, before nation-state, gender and or other attributes if the economy is to be maintained. For performance and quality weigh most greatly in providing the work product upon which society depends. Government, law and regulation come before and prior to materialism and wealth. For, wealth cannot be obtained, utilized, regulated or maintained without a well-regulated representative democracy.

No sole ruler, neither the benevolent dictator nor monarch, can provide an enjoyable sense of wealth and riches to the modern public. Rather, required is a distribution of wealth, monies, and funds, based upon contribution to maintaining meritocratic access to government, private and public social institutions and organizations. For, democracy and its premise upon justice and fairness applies throughout society from top to bottom, however defined.

Rules honoring the distribution of compensation and attribution of value must be as equally enforceable and enforced as rules governing participation. For, wealth as evidenced by a tenderable coin of a sovereign realm has no value without acquiescence and deference by each individual to the rules of the nation. Excessive disparity cannot logically or reasonably exist at the expense of governing officials and academics who provide a greater source relied upon within the Union.

Lori Gayle Nuckolls, Esq.

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Economic Rights: the Basis of Freedom

Participatory democracy is something in which we should all believe. Humans began as “hunters and gathers,”  roaming alone in a hostile environment. As savages, we imposed an economy upon our coming together to trade fruits, berries, pelts and meats. Our economy produces the culture we share. America’s economy today is complex and global. Yet, we bargain still one human being with another. We share a common currency. Yet, we meet in an innumerable number of marketplaces. Still, we share in and exist in our one economy. Our neighborhoods should be thought the cornerstone of our economy.

The letter below is a comment I submitted today to several Federal agencies which collectively govern the American economy and its financial institutions.

Lori Gayle Nuckolls, Esq.
1237 Paddock Hills Avenue
Cincinnati, Ohio 45229-1219

Lori.Nuckolls@post.harvard.edu
lnuckoll@wellesley.edu
lorigaylenuckolls@cinci.rr.com
513-305-7902
September 16, 2018
Legislative and Regulatory Activities Division
Office of the Comptroller of the Currency 400 7th Street SW, Suite 3E–218
Washington, DC 20219
Sent via email to: VolckerReg.Comments@ occ.treas.gov, Re: Docket ID OCC–2018–0010

Ann E. Misback
Secretary
Board of Governors of the
Federal Reserve System
20th Street and Constitution Avenue NW
Washington, DC 20551
Sent via email to: regs.comments@ federalreserve.gov, Re: Docket No. R–1608; RIN 7100–AF 06

Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
550 17th Street NW
Washington, DC 20429
Sent via email to: comments@FDIC.gov, Re: RIN 3064–AE67

Brent J. Fields
Secretary
Securities and Exchange Commission
100 F Street NE
Washington, DC 20549–1090.
Sent via email to: rule-comments@ sec.gov, Re: File Number S7– 14–18

Christopher Kirkpatrick
Secretary
Commodity Futures Trading Commission
1155 21st Street NW
Washington, DC 20581.
Sent via email to: https://comments.cftc.gov, Re: RIN 3038–AE72

Re: Proposed Revisions to Prohibitions and Restrictions on Proprietary Trading and Certain Interests in, and Relationships with, Hedge Funds and Private Equity Funds

Dear Agency Administrators,

I write in reference to the proposed revision of the 2013 Volcker Rule, 12 C.F.R. Part 44, collectively by the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve, the Federal Deposit Insurance Corporations, the Securities and Exchange Commission and the Commodity Futures Trading Commission, (individually, an ‘‘Agency,’’ and collectively, the ‘‘Agencies’’). Please consider this letter to be a formal submission of comments upon this proposed rule amendment in response to the Notice of proposed rulemaking published by your Agencies in the Federal Register, on July 17, 2018, 83 Fed. Reg. 33432. All citations herein to proposed amendments to the Code of Federal Regulations reference the proposed rules of the Comptroller of the Currency only and parallel citation to the proposed rules of all Agencies has not been attempted.

The Purpose of the Proposed Amendment of the Volcker Rule

The Agencies state that the rationale and premise for the amendment of the Volcker Rule is the learning and improvement of the largest banking entities since the 2013 amendment of the Bank Holding Company Act (the “BHC Act”) and the 2013 amendment to the Volcker Rule promulgated thereunder. In that, since 2013, the Agencies have found that the banking entities have engaged in detailed compliance under the 2013 BHC Volcker Rule. These requirements were intended to prevent great economic loss and distress from speculative, proprietary trading by the banking entities. (83 Fed. Reg. 33432, 33434 (July 17, 2018)).

The Agencies profess that the banking entities are more sophisticated, more prudent and consequently, less of a threat to the safety and soundness of the financial system if engaging in the purchase and sale of securities for their own account. Thus, the Agencies are amending the 2013 Volcker Rule to lessen the regulatory burden of reporting proprietary trading in order that compliance resources may be directed, instead, to profit making commercial activities. (83 Fed. Reg. 33432, 33434 (July 17, 2018)). The Agencies propose that the extent of reporting compliance required be determined by the monetary value of assets available to each individual banking entity for trading. The amendment creates three categories of banking entities with three different levels of reporting compliance. Id.

My comments are offered in request that the Agencies reflect upon the amendment of the Volcker Rule as it would govern those banking entities with no more than $1 billion in available trading assets, globally, including affiliates. This is the third and smallest designated tier of banking entities both within the American economy and international banking, subject to the proposed amendment of the Volcker Rule. The Agencies have designated these smallest of banking entities to be by definition those entities with ‘‘limited trading assets and liabilities.” (83 Fed. Reg. 33437 (July 17, 2018))(to be codified at 12 C.F.R. § 44.2(t)).

Creating a regulatory safe harbor, the amendment would exempt these smallest of banking entities, possibly for the first time, from all proprietary trading reporting compliance. Under the safe harbor, the small banking entities are not required to routinely file periodic proprietary trading reports with their respective agency. And, the small banking entities must only do so after notice of regulatory inquiry, and a request for evidence of compliance ex post facto. The amendment proposes to transfer the burden of proof as to proprietary regulatory compliance from the small entity to the Agency. (83 Fed. Reg. 33432, 33450 (July 17, 2018)).

The Agencies only grant this safe harbor to the small banking entities. This is done through the recognition by the Agencies of a “presumption of compliance.” (83 Fed. Reg. 33460 (July 17, 2018)(to be codified at 12 C.F.R. § 44.20(g)). No small banking entity would bear the burden of demonstrating affirmatively on a periodic basis that its proprietary trading is in due compliance with governing regulatory proscriptions. The safe harbor also exempts the small entity from all compliance requirements as to potential conflict of interests. (83 Fed. Reg. 33432, 33441 (July 17, 2018)). With respect to large and mid size banking entities, as the first and second tiers regulated, the amendment merely lessens and does not completely remove requirements as to proprietary trading reporting and conflict of interest. (83 Fed. Reg. 33432, 33441 (July 17, 2018)).

As the Notice states:
“[an] Agency may exercise its authority to rebut the presumption of compliance and require the banking entity to comply with the requirements of the rule applicable to banking entities that have moderate trading assets and liabilities. The purpose of this presumption of compliance would be to further reduce compliance costs for small and mid-size banks that either do not engage in the types of activities subject to section 13 of the BHC Act or engage in such activities only on a limited scale.”

83 Fed. Reg. 33432, 33437 (July 17, 2018). I support the stated objectives of the Agencies in formulating the amendments to the Volcker Rule in theory, yet I am uncertain and quite doubtful that these objectives will be fully achieved in practice without too great a compromise of the public interest.

As published in the Federal Register, with respect to the Volcker Rule:

“the Agencies are issuing this proposal … to amend the 2013 final [Volcker] rule [promulgated pursuant to section 13 of the Bank Holding Company Act, the “BHC Act”], in order to provide banking entities with greater clarity and certainty about what activities are prohibited and [the Agencies] seek to improve effective allocation of compliance resources where possible. The Agencies also believe that the modifications proposed herein would improve the ability of the Agencies to examine for, and make supervisory assessments regarding, compliance relative to the statute and the implementing rules. While section 13 of the BHC Act addresses certain risks related to proprietary trading and covered fund activities of banking entities, the Agencies note that the nature and business of banking entities involves other inherent risks, such as credit risk and general market risk. To that end, the Agencies have various tools, such as the regulatory capital rules of the Federal banking agencies and the comprehensive capital analysis and review framework of the [Federal Reserve] Board, to require banking entities to manage the risks associated with their activities. The Agencies believe that the proposed changes to the 2013 final rule would be consistent with safety and soundness and enable banking entities to implement appropriate risk management policies in light of the risks associated with the activities in which banking entities are permitted to engage under section 13.”

(83 Fed. Reg. 33432, 33434 (July 17, 2018))(emphasis added). The proposed Volcker Rule amendment proposes to balance the principles governing the substantive public rights granted by federal law to the banking entities with public concern for the safety and soundness of the American banking system. The public interest includes the wellbeing of the global macroeconomic economy of the United States in the world, as well as the wellbeing of the microeconomic economy of the small community depository institution in rural and provincial American geographic areas. To achieve the purpose of the proposed Volcker Rule, the Agencies must safeguard both the American economy and individual financial institutions.

The Rationale for the Volcker Rule

The Volcker Rule is founded upon the perceived need to prevent depository institutions and their defined affiliates from engaging in speculative, proprietary trading, deemed inherently too risk averse for the banking system. The Agencies offer a revision of compliance obligations incumbent upon banking entities engaged in certain proprietary trading activities which are expressly exempted from the general prohibitions by law. In doing so the Agencies would lessen the compliance and reporting requirements of banking entities concerning information regarding their proprietary trading activities
Still, the proposed amendment of the Volcker Rule remains conservative in that it would reinforce the time honored prohibitions begun with the Banking Act of 1933 (popularly known as the “Glass-Steagall Act”). (83 Fed. Reg. 33432, 33436 (July 17, 2018)).

The Agencies expressly state that the new rights as to proprietary trading reporting compliance must abide preexisting prohibitions regarding certain types of securities activity. Most importantly, no trading activity by a banking entity may: (1) create a conflict of interest between the banking entity and a customer; (2) directly or indirectly create a material exposure to a high-risk asset or high-risk management strategy; nor (3) create a threat to the safety or soundness to the banking entity or the United States. Id.

The Glass Steagall Act provided, in Sections 2 and 20, that a depository institution, or bank, could not affiliate in any manner with any corporation engaged primarily in the issue flotation, underwriting, public sale, or distribution of stocks, bonds or other securities. This created the existing barrier against conflict of interests by prohibiting an officer or director of a corporation involved in such securities activity from serving as a bank officer or director. Similarly, Sections 16 and 21 of the Glass Steagall Act created a reciprocal prohibition by preventing banks from issuing securities and by preventing underwriters from accepting deposits.

The Volcker Rule Amendment Lacks Guidance for Small Banking Entities

Even with the continued conservatism as to small banking entities, there is an absence of concern in both the Notice and the proposed regulation for the extent to which the amendment leaves small banking entities without the didactic guidance of federal regulation and compliance. The Agencies offer in explanation that the small banking entities do not in engage in proprietary trading to an extent necessary to merit the cost, time and effort required in complying with current regulation. And, foremost, little regulation of the smaller entities is indicated for the sake of the safety and soundness of the banking industry and American economy. The practices of small banking entities have not proved a source of economic risk and loss with systemic implications, as have, to a truly great extent, the commercial activities of the mid and larger size banking entities.

The safe harbor presumption of compliance provides small banking entities with reduced cost of compliance, for reasons that reducing their compliance burdens as well as reducing and more greatly systematizing compliance of the mid and larger size banking entities will promote profit and economic growth without risk. Yet, small banking entities more greatly defer to and rely upon agency expertise. Small entities have reduced access to the information gleaned from periodic compliance as well as the due diligence periodic compliance requires. The Agencies should supplement the newfound freedom from affirmative regulatory compliance, which the presumption of compliance provides, with greater oversight, guidance and public education as to the role and function of small banking entities in cities and their communities. The Agencies should transition the small banking entities, which with the larger entities merit the reduction in regulatory compliance, into the greater commercial activity and profit envisioned by the amendment.

Adhering to and satisfying the detailed requirements of regulations has over many years provided learning through compliance for the smaller entities beyond the information and management resources of larger entities, regardless of market. Such remains true for the larger banking entities. For example, the amendment requires the larger banking entities to self-tailor an in-house reporting system that would require analysis of regulation and the entity’s commercial activities, a six-pillar compliance program. (83 Fed. Reg. 33436 (2018)) (proposed to be codified at 12 C.F.R. § 44.20(a)) and (83 Fed. Reg. 33560-33563 (2018))(proposed to be codified at app. to 12 C.F.R. Part 44). The larger entities would be required to analyze: (1) written policies and procedures; (2) internal controls; (3) managerial structures; (4) independent compliance reviews; (5) training and recordkeeping; and (6) metrics reporting requirements. (83 Fed. Reg. 33432, 33439 (July 17, 2018)). The Agencies provide guidance to the larger entities in imposed regulatory obligations found in the Appendix as published in the Notice and proposed rule. Yet, if the small entities are expected to be guided by these provisions without obligation, the level of their regulatory burden is not minimized, yet presumably increased as the financial markets changes over time and they must self-regulate.

While small entities are not so anonymously amorphous as to require as extensive a review and reporting system as those much larger, the small entities will no longer conduct business under the same incentive for compliance as once before. Even without an inability to self-govern and delegate in-house measures for avoiding improper proprietary trading, the small banking entities should be encouraged to work promptly upon the effective date of the amendment with the business school centers of the institutions of higher education in their areas to provide a national view of compliance in the ordinary course of business, Thus, if a routine audit generates an Agency request for documentation of compliance over many years, the small entity may comply.

The Agencies might ask the effect of replacing a detailed and stringent regulatory burden with a “presumption of compliance” in a small banking entity. Perhaps the Agencies should encourage: (1) the development of prudent market sophistication among competitors and customers as well as (2) collaboration among the administrators and staff of small banking entities with members of institutions of higher education on topics of financial institution regulation and management. Promoting sound self-governance would permit the amendment with all requisite safety and soundness in even the most remote and smallest of regions in the United States. For, a small banking entity might well be inadvertently less than conservative and less risk averse than it should be in its investments if it believes its only risk of noncompliance is in the course of its ordinary periodic audit. Evolving standards governing the presumption of compliance during after-the-fact reviews permit agency discretion, yet without some transition small entities may not as readily self-regulate to produce a revision of the compliance standards being removed with changes in the marketplace and the effectiveness of the presumption.

Under the proposed Volcker Rule, small banking entities in small cities and towns may no longer rely upon the overarching policies of federal agencies to temper the autocratic micromanagement of CEOs and Officers. The Agencies give rise to an affirmative vision of the banking industry within an international context through regulation and compliance review. The presumption of compliance requires a new approach by the Agencies in guiding the business decisions of the small banking entities with similar agency efficiency. This should be neither difficult nor costly for small banking entities possessing worldwide assets of less than $1 billion constitute only 2% of America’s banking entities according to the Notice. 83 Fed. Reg. 33432, 33440-33441 (July 17, 2018).

In Conclusion

I suggest that the small banking entity not be abandoned by the regulators and that the Agencies provide some guidance in behest of the public interest concerns of fair, just and equal commercial development throughout American cities, states and regions. A different systemic risk exists if an absence of regulation for those least able to self-regulate promotes fear among small banking entities and their customers and then, not for reasons of evasion or misplaced or imprudent motives, transactions are made merely for want of deference to the metaphysical guidance once perceptible above.

The Agencies together govern a complex and diverse financial industry, composed of many types of financial institutions and entities created by right and privilege under the laws the Agencies administer. The Agencies may only continually seek to achieve an equilibrium in the burden of regulatory compliance to be borne themselves as each a governing agency, and as to that burden to be borne by the public. In doing so, the Agencies guide all market stakeholders and thereby produce national prosperity and capital growth. The proposed amendment is a result of what the Agencies have gleaned from the marketplace and the amendment may readily promote public participation, research, discussion of policy making, examination and enforcement.

I thank you greatly for considering my comments on this rule. And, I may certainly be contacted as indicated above.

Sincerely,
Lori G. Nuckolls
Lori Gayle Nuckolls

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When is Personal Status a Crime?

Is it moral, ethical and or proper to criminalize personal decision making that does not challenge the individual identity and or personhood of another? Does a right of citizenship or even of the individual exist if one is unable to disclose the structure of one’s social existence because the structure is proscribed by law and criminalized by the government under which one collectively lives?  This question applies to all attributes of the individual, whether it be gender, marital structure, race, source of income, and many other common and current practices of modern existence.

 

If harm is not imposed upon another, in the thinking of John Stuart Mill (1806-1873), these personal attributes are expressions of liberty and freedom, derived from existence and nature, and may not be ethically restrained by the government. Persons exist within the fellowship of existence. Law and government which encroach upon one’s personal individuality, liberty and freedom are ensured only by prejudice according to Mill.

 

Even the most liberal and inclusive of elected statesmen has not yet remedied all such personally experienced difficulties in which one is unable to disclose the structure of one’s existence by virtue of one’s life structure being, in some aspect,  prohibited by law. We can know the spoken and written words of our governing officials and candidates. Yet, how can we fairly evaluate their demeanor if the material source of their identity, their life structure, is prohibited from being disclosed to the public. Their temperament, regardless of intensity, may not unilaterally be determined by matters in discussion before them.

 

In his Thoughts on the Present Discontents, Sir Edmund Burke (1729-1797) expressed the view that:

Government is deeply interested in everything which, even through the medium of some temporary uneasiness, may tend finally to compose the minds of the subjects, and to conciliate their affections. I have nothing to do here with the abstract value of the voice of the people. But as long as reputation, the most precious possession of every individual, and as long as opinion, the great support of the State, depend entirely upon that voice, it can never be considered as a thing of little consequence either to individuals or to Government.

(emphasis added). Under American law, as derived from the words of Edmund Burke, as well as countless additional voices of all hues and genders, all should have full, complete, and unfettered participation with one voice. The voice of the individual, not that of the abstract “tyrannous majority” is the founding principle of our government.

 

Some indicia of personal status, which upon actus reus, or effectuating conduct, constitute a crime in virtually all of the 50 American states are a noncriminal personal status of mental intent, such as a personal yet unconsummated devotion to a career of prostitution or the intent to engage in multiple marriages upon reaching the age of puberty without equal treatment under formal legal acknowledgment of the marital union. If, upon the effectuating act, traditions of liberty in America exist untranscended, is there an ethical rationale for this criminalization?

 

Sir Burke agrees that a nation is merely the composite of the individuals comprising it in cellular diversity. The principles of respect and ethics by which our nation of individuals is governed are derived via prescription from the very principles by which individual humans share and comport with one another. In the words of Burke:

 

Nations are governed by the same methods, and on the same principles, by which an individual without authority is often able to govern those who are his equals or his superiors, by a knowledge of their temper, and by a judicious management of it; I mean, when public affairs are steadily and quietly conducted: not when Government is nothing but a continued scuffle between the magistrate and the multitude, in which sometimes the one and sometimes the other is uppermost — in which they alternately yield and prevail, in a series of contemptible victories and scandalous submissions.(emphasis added). Anglo-Saxon, conservative thought upon which America was founded provides due precedent for legalization of many American civil privileges long acknowledged and many that might be.

 

Such support in the writing of Burke long preceded the day and era of American poet Emma Lazarus (1849-1847) and her poem The New Colossus, in which she wrote:

Not like the brazen giant of Greek fame,

With conquering limbs astride from land to land;

Here at our sea-washed, sunset gates shall stand

A mighty woman with a torch, whose flame

Is the imprisoned lightning, and her name

Mother of Exiles. From her beacon-hand

Glows world-wide welcome; her mild eyes command

The air-bridged harbor that twin cities frame.

“Keep, ancient lands, your storied pomp!” cries she

With silent lips. “Give me your tired, your poor,

Your huddled masses yearning to breathe free,

The wretched refuse of your teeming shore.

Send these, the homeless, tempest-tost to me,

I lift my lamp beside the golden door!”

 

 America lives by a written social contact of enlightened popular democracy. All participate equally. Participation requires an equal voice. A voice hindered and encumbered when such encumbrance is not materially required is unjust. Conservative theorists suggest that persons come together in society when encouraged and implored by a subconscious sense of order, even in present times.

 

In the thoughts of our President Franklin Roosevelt, democratic patriotism is the right of all on American soil, to seek freedom from prejudice and unkindness, which he deemed an affront not only against the one but also as against the many within the American public. Declaring life structures that are harmless to another to be harmful to the general public when the argument declaring such is  not based upon an understanding of the manner in which the rights of individuals and of the government are compromised is invalid.  Such assertions of criminal conduct deprive all of liberty and freedom. It is not patriotism under any theory of a respect for our constitutional rights or the national security of our nation, domestic or abroad. For, most importantly, government that is open is government that is most wise, most fair and most just. The people professing life structures we currently criminalize such as:  prostitution, multiple marriages, and controlled of substance use, are currently the people we regulate from the criminal and noncivil side of the line as currently drawn. If no injury to others, why not the civil side of the line?

 

 Legal right to the privilege of government acknowledgment of our personal identity and personhood are prerequisites to a constitutionally acknowledged right to speak freely and participate in government.  Men and women who offer sexual services for monetary compensation, and sister wives and brother husbands are currently deemed status criminals as to the social contacts to which they are a party. If the multiple wives and brothers seek formal written and governmentally filed licenses of marriage, they are illegal by virtue of intent to misrepresent their family structure and chosen social contract. If men and women who trade currency for sexual favors do so they consummate written and or oral contracts that contravene governing law. If the only proper and ethical concerns of American government are the respect for the rights of our citizens and America’s founding principles of justice and fairness, and not the various tenets and principles long ago giving rise to various proscriptions against certain social contracts, upon what proper bases are these proscriptions founded? For, they continue to exist in numerous and myriad informal and unregulated forms that have been deemed to readily devolve into abuse in previously no longer criminally contexts.

 

Sex commerce and multiple marriage partners deserve the ordinary rights of citizenship under state and federal law. These rights include the centuries old rights to: real property ownership and management; state and local tax treatment; business commerce and  investments; banking privileges; family and juvenile law; no less participation in voting and elections; expressions of faith; and public education, with its long acknowledged absence of truancy compliance, and the aggregations of proceeds brought to America, etc. Only with open access to government and society, that legalization brings, may many honest people not live in fear.

 

Lori Gayle Nuckolls, Esq.

 

 

Philosophy, Law and Politics

Is It Becoming a Meritocracy?

I attended the annual CBA-Roundtable Minority Summer Law Clerk Reception of the Cincinnati Bar Association, held this year in the Cincinnati headquarters of historic Taft Stettinius & Hollister LLP. Taft made a stupendous effort in welcoming law students far beyond the bounds of the traditional path of the “stocks and bonds” law firm. The large gathering included prominent Cincinnati  attorneys and governing officials whose careers began much before the era of “discussions of Diversity and Inclusion.” Several first in the family college graduates and law students, whose summer private sector position was a continuation of their academic year law clerkship, expressed true and sincere appreciation for participation early in their careers. Many years ago, fear and resentment would have been evident, but less so in the era of the Clintons and the Obamas. Attorneys who are graduates of elite law schools are now a known entity.

My personal view toward issues of diversity and inclusion, as well as to most all subjects, does not go beyond one of academic diplomacy, based upon merit. I rarely, if ever, form an opinion which I would sternly support against another. Perhaps, doing so would be necessary if the law in Cincinnati and Ohio, state and federal, were more competitive as to client interests. It seems, rather, you may draft beyond reasonably anticipated future challenges.

Fundamentally, the issue of diversity and inclusion in the Cincinnati remains a question, even in light of the true expression of grace at this year’s Minority Law Clerk Reception, of revisionism in the interpretation of local history. Diversity and inclusion are, together, of the many questions asking the manner in which Ohio, and, specifically, Cincinnati, reach the accomplishments reached long ago by many cities and states in America. In some respect, modern issues of inclusive and diverse public and private policies require historical due diligence. This diligence would ask as to the possibly causative and still existing precursors to our issues of, as is our lengthy litany: “affirmative action;” “ending separate-but-equal or defacto segregation;” “integration;” “lack of discrimination;” and “transcending segregation.”

As a Sole Practitioner admitted into practice in the States of Ohio and New York, I have returned to my primary legal subject of administrative law, state and federal, after years in researching and writing on topics of federal litigation. Before, I was not permitted to present arguments found in the judicial opinions of courts beyond the Sixth Circuit, nor in scholarly secondary legal sources.

In solo general private practice, I have given comment on a variety of proposed Ohio Administrative Code provisions, as well as proposed regulations of the U.S. Securities and Exchange Commission and the U.S. Department Health and Human Services. With interpretative reliance upon the founding principles of American government and traditional legal methods of research and argument, one may readily suggest improvements in our governing law.

One belief I do hold is that, in America,  private legal practice, even mine, is the source of American common law. For, our common law  is actualized from custom unto law by courts and commercial contractual  dealings.

From this, questions arise as to how we might garner acceptance of all law school graduates, equally, by all employers. Have we asked how we do this without great disregard for personhood as to any? For, justice is not thereby accomplished. In asking that the least graduated are accepted first by the traditionally reclusive within the legal community, as is being done in both the private and public legal sectors, how will accreditation bullying be dissuaded if it is accorded profit and merit by being paid first?

In the last 25 years or so, Cincinnati has dramatically experienced major economic growth and prosperity. The local universities are more noteworthy than ever before for notable faculty and truly more expansive research programs and centers. Yet, the law in Ohio, has not similarly kept pace.

The Ohio Administrative Procedure Act, in its present form, dates from the mid-1950’s. The Ohio Revised Code has not been revised to encourage economic advance, no less to permit the successful management and retention of the material success Ohio, and Cincinnati, have enjoyed. Most developing cities and states have managed both law and money.

 Cincinnati does not live under the aura of national institutions of higher education that benefit Ohio’s northern cities. And, Ohio law has also not developed as has our international commerce has developed. To an even greater extent, the agenda of pending maters before the weekly meeting of the Ohio Joint Committee on Agency Rule Review, indicates that Ohio’s administrative law is scarcely worthy of being deemed “final agency action” in 2018 by state and or federal standards.

Relative to the laws written by attorneys in the State of New York and within the federal government, the laws of Ohio are truly a cruelty.  Even if the cruelty does not result from enforcement of obsolete legal standards, the cruelty occurs when those who have chosen to reside and make commitments to neighbors and institutions are then finding themselves under an anvil of suppressive statutes and administrative rules lacking the modern reasoning and logic of the material goods, services and technologies imported into the State of Ohio  in interstate commerce to which they commit their funds.  Funds and services these arcane statutes profess to govern.

If our laws lack clarity and reasoning, no one can self-govern, regardless of partisanship or opinion. How do clients, attorneys and law students know the source of anxiety in professionalism and in consummating legal services? Without, a best-efforts approach to legal services and best-efforts selection of attorneys and law clerks how will any meritocracy ever be accepted or regarded? To what does our democracy then devolve?

As citizens, as well as attorneys, we have no publicly shared actualizing dialectic, Hegelian or otherwise. Our American government and economy, private and public, are defined as a natural, meritocratic system of profit-based competition, permitting the creation and ownership of value with respect for liberty and privacy.

In Cincinnati, the concern is that the majority of residents do not inform themselves and do not form opinions. They seem mentally transient, as I seem to believe I have heard others say. They seem without a sense of Hohfeldian right, or even privilege, to mentally consider information readily available to the public, no less form an opinion. There is a sense of self-imposed mental repression.

Perhaps the two major political parties gave for too long and without due meritocratic review opportunity to hold government office to those from a variety of social strata not ever before officeholders in America. These are those in the nation who were not among those graduated from elite academic American institutions of higher education. These are those not from the moneyed classes.

Yet, delegating the power to draft and or effectuate legislation and imprison citizens to those for centuries deemed scarcely qualified to hold office is neither democracy nor justice unless the officials demonstrate equal or superior merit.  These not yet officeholders were long denied candidacy for office, in part, because they were not of the rich and powerful aristocracy in America, among other reasons. This is the basis for the argument that the absence of participation as representatives was unjust. It is not an expression of unfairness that one is denied nomination because another candidate is of a greater college board ranking than thou. Such a denial is not violative of the thought of Edmund Burke, nor Jack Randolph, nor T.J. Such a denial or exclusion similarly comports with meritocratic selection of attorneys and legal arguments.

My thoughts on “what is wrong” in Cincinnati and Ohio, as the once Chair of Democrat Ward 7 John Albert “Socko” Wiethe, as the immediate predecessor to my father Charles Nuckolls,  as Chair, used to say, are derived from the phrase: “Let history be our guide.”

Lori Gayle Nuckolls, Esq.

Philosophy, Law and Politics

Should Income Parallel Success, Private and Government?

 The current salary of a Federal appellate judge sitting within one of the U.S.  judicial circuits is $220,600 per year. http://www.uscourts.gov/judges-judgeships/judicial-compensation. This includes the current annual salary of sitting Judge Brett Kavanaugh of the D.C. Circuit. If Judge Kavanaugh is promoted to the U.S. Supreme Court, he would be an Associate Justice and would earn $255,300 sitting under Chief Justice John Roberts. The Chief Justice earns $267,000.  http://www.uscourts.gov/judges-judgeships/judicial-compensation. Do their salaries adequately compensate them for the value of their labor and contribution to America and to Americans? How do we justly and fairly value their contribution?

 

Antifederalist No. 1 said of the proposed U.S. Constitution, in its “General Introduction: A Dangerous Plan of Benefit Only to the “Aristocratick Combination:”

 “I am pleased to see a spirit of inquiry … upon the subject of the NEW PLAN …. If it is suitable to the GENIUS and HABITS of the citizens of these states, it will bear the strictest scrutiny. The PEOPLE are the grand inquest who have a RIGHT to judge of its merits. The hideous daemon of Aristocracy has hitherto had so much influence as to bar the channels of investigation, preclude the people from inquiry …. At length the luminary of intelligence begins to beam its efflugent rays upon this important production….”

 In our modern words, We as the People of America govern our country having, liberated our American Colony from the British Empire, and having established a republican form of government. The Founding and Governing Fathers and Mothers, then deemed and still deem, their beloved People and Publick, the “tyrannous majority.” For, though we are all worthy of the essential human nature of mankind, we are not all worthy of ascending unto those among us who “represent the masses” comprising our American Republic. The Founding and current Governing Persons of America are of the privately governing intelligentsia of America, our “natural aristocracy,” not solely to be derived from the governing “Aristocratick Combinationand “daemon of Aristocracy” of Anti-Federalist parlance. Before the American Declaration of Independence, Englishman William Blackstone said, similarly of the English aristocracy, governing “peers of the realm are by birth hereditary counsellors.” (William Blackstone. Commentaries on the Laws of England, Book the First: Of the Rights of Persons. Ch. 5, l. 6.)(1765). How do we reform an economic structure in which value and income are determined and derived, not by merit and contribution to the administration and governance of society and our community, but by Roman game like, enzombieing, entertainment, tendered to a nonparticipatory public that is uninformed and is not capable of self-governance?

 

A philosophical appeal in English Statesman and Philosopher Edmund Burke‘s “Letter from The New to The Old Whigs” in, 1791, suggests that:

“A true natural aristocracy is not a separate interest in the state, or separable from it. It is an essential integrant part of any large body rightly constituted. It is formed out of a class of legitimate presumptions, which, taken as generalities, must be admitted for actual truths. To be bred in a place of estimation; to see nothing low and sordid from one’s infancy; to be taught to respect one’s self; to be habituated to the censorial inspection of the public eye; to look early to public opinion; to stand upon such elevated ground as to be enabled to take a large view of the widespread and infinitely diversified combinations of men and affairs in a large society; to have leisure to read, to reflect, to converse; to be enabled to draw and court the attention of the wise and learned, wherever they are to be found; to be habituated in armies to command and to obey; to be taught to despise danger in the pursuit of honour and duty; to be formed to the greatest degree of vigilance, foresight, and circumspection, in a state of things in which no fault is committed with impunity and the slightest mistakes draw on the most ruinous consequences; to be led to a guarded and regulated conduct, from a sense that you are considered as an instructor of your fellow-citizens in their highest concerns, and that you act as a reconciler between God and man; to be employed as an administrator of law and justice, and to be thereby amongst the first benefactors to mankind; to be a professor of high science, or of liberal and ingenious art; to be amongst rich traders, who from their success are presumed to have sharp and vigorous understandings, and to possess the virtues of diligence, order, constancy, and regularity, and to have cultivated an habitual regard to communative justice: these are the circumstances of men that form what I should call a natural aristocracy, without which there is no nation.”

American democracy guarantees: (1) liberty to act without encroachment; (2) freedoms of belief and expression; (3) a right to property; and (4) representative participation.  In drawing the line between the rights of personal and real property rights to enforce and those rights of personal and real property to not enforce, how should we draw the law attributing ownership? Do our governing authorities possess a metaphysical, in-kind contribution of productive labor, not yet acknowledged and compensated?  How do we attribute the right of ownership and upon what criteria do we base value?

 

Monetary creation, if to forever remain democratic in our society, requires an assurance of justice and fairness, guaranteed to the youngest of age within the smallest of political subdivisions. Justice and fairness are required within the smallest of political subdivisions in the United States of America to the largest. Within the U. S. of A., the sitting U.S. Supreme Court sits within America, as a political subdivision. America, itself, is within the various international entities to which the U.S.A. belongs. And, America’s own international political subdivision boundary exists coextensively with the sovereign political boundary of the United States itself. The financial compensation paid in America to our governing authorities, our natural aristocracy, should permit any American to ascend to the utmost respected stratum of a career in American government regardless of socio-economic stratum of origin. Such should be a coextensive definition of human rights under governing international law.

 

In creating and administering the three branches of our representative democracy in America, how do we determine the value of guaranteeing democracy itself, the value of the attorney work product of governing officials and of attorneys and judges?  Their work tasks are deemed entrusted to them by the people and deemed to be of inestimable value, for their tasks guarantee to every citizen freedom, liberty and justice.

 

Yet, how do we compensate governing judges and officials so that those who write, administer and interpret our laws may be those for whom doing so is within the “American dream,” regardless of socio-economic stratum of origin? All in government are held in proper honor and esteem for the values they hold dear and that they guarantee? Is a mere civil servant, governor, assemblyman, state judge, and the work they produce for the community less important than that of the president, senator, congressman, federal judge or agency secretary? How do we imbue citizens with patriotism and love of county when the salaries of their governing members are exceeded by those of professional sports team players, though the players express thoughts and values publicly protected by these governmental actors every day? How will the next Justice of the U.S. Supreme Court “make ends meet?”

Lori Gayle Nuckolls, Esq.

Philosophy, Law and Politics

Greenspace and Culture for All!

The Cincinnati park of Burnet Woods is a wonderful asset of the Cincinnati community, and has been so since first begun in 1872. And, our community is obligated to both maintain and transition this park into a modern greenspace. Cincinnatians and learned science professionals, together, should discuss and decide the proper changes to Burnet Woods and Cincinnati’s greenspaces, generally. The current proposal for two community center buildings in Burnet Woods brings to popular discussion an issue not yet mentioned that is less related to concerns of environmental preservation. Specifically, the proposal to place a building within Burnet Woods that would essentially serve the current purposes of the Clifton Cultural Arts Center asks questions about equal planning for our various neighborhoods in Cincinnati.

Currently, the Clifton center provides cultural events and educational resources to those beyond the neighborhood of Clifton. Many young and old within Cincinnati would like to continue to rely upon the center. And, its location in Burnet Woods would have to be generally accessible by car and school bus. For, it is unlikely that it would be as currently within reach of those visiting by foot from nearby.  But, more importantly, the center would place on public land a resource generally needed, yet unavailable, in most neighborhoods. The Clifton center arose from the needs and requests of one Cincinnati neighborhood. And, it has ably done so. Yet, a similar cultural resource has been long discussed and requested by many neighborhoods similarly in need, including the neighborhood of Ohio Representative Alicia Reece, namely Bond Hill.

Most neighborhoods would not be provided for by the arts center proposed for Burnet Woods. Before the Burnet Woods center is approved, we have an obligation to discuss providing access to cultural arts equally within the city. It is unlikely and unwise that each neighborhood community requesting such a center could request a similar grant of land to do so by the Cincinnati Park Board. The Burnet Woods proposal is not properly precedent, or ratio decidendi.

The discussion of providing beyond the neighborhood recreation centers is a difficult one, and neighborhoods such as Bond Hill have long puzzled the question of transitioning an aged commercial business district for modern use. A small cultural center was proposed for an area near the intersection of Reading Road and California Avenue. It would have been similar to the current centers in Kennedy Heights and Pleasant Ridge. Perhaps it, alone, would not have completely sufficed. Yet when does capitalism not permit trial and error of not-for-profit ventures as for our for-profit, start-up entrepreneurial ones. Essentially, the Burnet Woods center only initiates review and discussion obligatorily within the purview of our discussion of fair and equal neighborhood planning.

For our neighborhoods stymied as to a beginning, even a small urban gardening space, such as one upon a space near the proposed cultural center in Bond Hill, would begin discussion with a venture not requiring a permanent decision or commitment, and which, even if only short term, would ameliorate an available space.

Lori Gayle Nuckolls, Esq.

Philosophy, Law and Politics

To Legalize, Or, Not To Legalize?

In discussing the current debate of whether the use and sale of marijuana should be generally allowed in each of the 50 States, and no longer be deemed a criminal activity, requires that thought be given to American history and traditional theories of the law. And, perhaps our debate should focus on the history of Prohibition, last century.

Currently proposed legislation before the U.S. Congress asks if the Federal government may, or should, dictate that the use of marijuana is legal conduct for every citizen in every state. Or, should the Federal Government respect the aged-old American doctrine of States Rights and the prudent theory of experimentation within and among jurisdictions, whether they be the Federal judicial Appellate Circuits, the States themselves, or the various political subdivisions therewithin?

As citizens, we must ask in what manner marijuana differs from the time honored American  custom of enjoying fermented and distilled spirits – alcohol. If marijuana is properly legal in the United States, regardless of locale, for social, and not only medical, purposes, what is the scientific rationale for permitting it being criminalized in any jurisdiction within the country? If legal in any State and deemed safe by our scientific community, is there a valid legal rationale for treating the use of marijuana differently from the current regulation of our use of alcohol?

Traditional grassroots, self-governance of communities in America is the foundation of our democracy, our representative republic. Governing jurisdictions, as small as towns and villages, may dictate legal policy as to the sale and use of alcohol within their jurisdictions. Yet, they may not proscribe the use of alcohol. This has only been done and repealed by a revision of the U.S.  Constitution. Marijuana, like alcohol, should properly be regulated below the Federal level by State and Local Governments only as they regulate  commerce within their boundaries. Like alcohol, marijuana requires more regulation than English muffins and wheat bread. Such regulation, though, results from theories of corporate and business structure, and the proper purposes of land use management – zoning restrictions.

If legal in one State, marijuana should be legal in all. And, the existence of the 50 States, and our various political subdivisions and territories, permits American capitalism to experiment.  Various business forms may evolve from the art of the “dry county,” the State owned and or regulated, stand alone “brick and mortar” business concern, or the State regulated, corner shop in the interstate or international grocery store.

And, there cannot be an argument for not fully expunging the criminal records of conviction and time served for offenders penalized for personal expression before their governing officials “saw the light.” It goes without saying, then, that, too, all criminal defendants currently “serving time” for marijuana only offenses should be released through existing transitional, reentry programs. Not doing so would be merely a creative theory of law ex post facto.

Lori Gayle Nuckolls, Esq.

Philosophy, Law and Politics

Partisan Politics Be Damned!

I am no longer registered to vote in the United States. I formally resigned my registration in writing last year. I decided that I could no longer be silently accountable for the opinions of any one candidate or office holder for whom I may have voted.

My own political views are not of any one political party nor of any one political party platform. Last year, at 56 years of age; as a lifelong Democrat; as a former student President of the Wellesley College Democrat Club;  as an eldest child and only daughter of a retired History teacher who  “rubber stamps” the Democratic Party sample ballot at the polls, and who once served as a Democratic Ward Chairman; and as, myself, a former Democratic Precinct Executive who served by appointment in an unrepresented district in which I did not reside and, consequently, in which I could not stand for election, I formally switched parties and now pay national dues to the GOP (the “Grand Old Party” or the Republican National Committee).

I believe that the Republican Party in America professes and is held accountable for a belief in fundamental principles and the rule of law. Thus, their members must offer arguments and critiques based upon an assertion of fundamental principles and reasoning, supported by fact. My personal views and opinions will always differ in some respect from those of others, regardless of political party. Yet, neither candidates nor the rank and file members of any political party should deem themselves possessing a right to deny the necessity and merit of method, regimen, logic, and procedure, for without these guiding principles of democratic society and government, we will not have justice, equity or fairness, no less an equal right of participation.

American Democrats do profess these notions. Though, even with the Clintons, Obamas, and U.S. Attorneys General Reno, Holder, and Lynch, American Democrats expect to be believed and supported merely upon offering time honored liberal sermonizing, without reasoning, without a demonstration of fact, and without a suggestion of specific future action, conduct or policy reform proposals to support their time honored liberal sermonizing. For all the Democratic colleagues across the nation, one would imagine that every Democrat standing for election might easily obtain a great, new legislative proposal for his or her back pocket that could be brought before the public for discussion during the campaign season. The long honored Democratic Senator Robert C. Byrd carried a popularly available edition of the American Constitution in his breast pocket. Where is theirs? Most Republicans are not so flawed.

Lori Gayle Nuckolls, Esq.

Philosophy, Law and Politics

Clarity and Equality in the Ohio Sales Tax Statute?

 

The following Comment Letter was submitted today to the Ohio General Assembly Joint Committee on Agency Rule Review for consideration during its review of a proposed amendment of an Ohio Sales Tax regulation regarding interstate commerce.

 

May 10, 2018

Joint Committee on Agency Rule Review

The Ohio General Assembly

Vern Riffe Center

77 South High Street

Concourse Level

Columbus, Ohio 43215

Sent Via Email to: jcarr1@jcarr.state.oh.us

Re: Department of Taxation Proposed Amendment of Rule Number 5703-9-39 (Interstate commerce)

Dear Members of the Joint Committee on Agency Rule Review,

I write with interest in the proposed amendment of Rule Number 5703-9-39 of the Ohio Administrative Code by the Department of Taxation regarding the imposition of a tax upon retail sale transactions between Ohio residents and out-of-state vendors. The Rule Summary and Fiscal Analysis submitted by the Department of Taxation to accompany this proposed amendment states that the Department seeks merely to make grammatical corrections in the Rule and not adopt any substantive changes.

The proposed amendment does not adequately revise the text of the Rule to correct certain wording that is confusing to citizens and residents of the various States who would engage in commerce, as well as those engaging in commerce abroad. For, it does not clearly indicate that purchases are exempt from taxation if delivered via an interstate carrier to either the buyer or the agent of the buyer and, instead, gives the sense that the exemption applies only to interstate carrier deliveries made to an agent.

Similarly, the proposed amendment retains reference to “an agent of his” in acknowledgement that Ohio purchasers of goods from foreign vendors may avail themselves of an agent to receive the goods purchased. Legal drafters in the 21st century style to no longer use personal pronouns reflective of gender when the concept of gender is not materially relevant to the import and substance of the law.

Finally, the Rule would also lessen confusion if it did not refer to the sales tax as a “retail sales tax” unless such is done consistently throughout Ohio Revised Code Chapter 5703: Sales Tax and Ohio Administrative Code Chapter 5703-9: Sales and Use Tax. For, the sales tax is more often referred to as an “excise tax,” and O.R.C. §5739.02, in implementing the sales tax, expressly states that “an excise tax is hereby levied on each retail sale made in this State.”

In respect of the foregoing, I offer the following modification of the amendment, with proposed changes italicized:

5703-9-39 Interstate commerce.

When tangible personal property is sold within the State and the vendor is obligated to deliver it to a point outside of the State, or to deliver it to a carrier or to the mails for transportation to a point outside of the State, the Ohio Sales sales Tax tax does not apply. However, where tangible personal property pursuant to a sale is delivered in this State to either the buyer or to an its agent, of his other than an interstate carrier the retail Sales Tax sales tax applies, unless the delivery is made by means of an interstate carrier, notwithstanding that the buyer may subsequently transport the property out of the State.

 The grant of a sales tax exemption for purchases made by Ohioans from out-of-state vendors whom, themselves, have no physical presence within Ohio or nexus with Ohio, is a great encouragement to the advance of commerce. It provides economic efficiency to domestic purchasers and encourages reciprocity in the tax policy of other States.

I thank you greatly for considering my comments on this Rule. And, I may certainly be contacted as indicated above.

Sincerely,

Lori G. Nuckolls