Turning In The Keys

One of the sadder effects of the Bush/Obama Depression has been the phenomenon of numerous families losing their homes to foreclosure. The direct causes for the losses have been varied. Some have lost employment and have had to choose between eating and meeting their mortgage payments. Some have been transferred to a different location in order to keep their jobs, and not being able to pay for both the home in the old location and that in the new, have abandoned the old. Some have realized that the home they purchased at a high price has devalued and that they are paying on a mortgage loan which, in terms of the value ratio that once was and the one that now is, has an exorbitant and punitive effective interest rate.

The reasons are numerous. Walking away from a house and its attached debt, however, is a poor solution, and should be avoided at all costs. Granted, there are financial advisors who would argue differently, but the picture should be examined not just as an economic one but also as a moral, ethical, and spiritual one.

It is possibly true that the most egregious sin (if you don't like that word, I would advise that you stop reading now) in America is covetousness. That is an old-fashioned word that loosely translates into English Vulgate as "greed". It is the driving factor in the American economy. It is the desire to have what someone else has. Prohibited by the 10th Commandment, it is there stated as wanting one's neighbor's specific belongings.

That is a narrow reading of the Law. The underlying principle has to do with the fact that God is the giver of all good gifts. America in general rejects that concept. In the modern American economy, it is believed that those who work hard and smart get rich, and those who are lazy or weak remain poor. A man's wealth is evidence of his brains and brawn, a major factor in his self-steem and pride. Thus "keeping up with the Joneses" or better yet a little ahead of them, has become the American dream and greased the path to further sin. It matters not how often he goes to church; a little leaven does a great puffy amount of damage, and few are immune to the lure and ravages of such sin.

A consequence of this rampant covetousness is the willingness to sell one's self into slavery. There is a certain segment of our society that believes it has a corner on the discussion of slavery. Because their long-dead ancestors were abused by people also long-dead, they carry a grudge against anyone who does not belong to their culture group, all the while tolerating (and even encouraging) a form of slavery more insidious and debilitating. They have no monopoly on being slaves. The great majority of the American populace has joined them.

The concept of credit in a capitalistic culture has a number of nuances. At it's core, credit is used to facilitate trade. Trader A has a stock of widgets which he is offering at a set price, but will sell them in bulk with a discount if he can liquidate his stock. Trader B needs the widgets, but has left his gold at home. Trader A agrees to sell all his widgets right now, with Trader B promising to send the gold as soon as he gets home. He signs a note to that effect. On his way out of the market, Trader A spots a fat sheep for sale by Trader C. He has no money, but his family is hungry. He trades the note from Trader B to Trader C for the sheep. As long as Trader B keeps his promise to pay, everyone is happy. This is the essence of a banking economy.

There is no condemnation of such an economy in the Scripture. There are warnings, though. The borrower is the slave of the lender (Prov. 22:7). Failure to pay what is owed is considered to be fraud (Lev. 19:13, Rom. 13:7). Further, failure to keep a promise is a sin (Num. 30:2, Matt. 5:33) and the warning is given that promises should always be conditional (Matt.5:34-37, Jas. 5:12, Jas. 4:13-17).

In our society we rarely consider these things, carelessly agreeing to Terms and Conditions, whether in a software download or a loan, often without reading thoroughly what it is we are agreeing to. Thus, in my career, I have come across people like the lady who was having her house appraised for a HELOC, not even knowing that her fully paid-for home would become the collateral (the loan officer, she said, had told he it was a good idea to take out the loan). Or like the man who became angry when told that his home would be compared to homes that had recently sold. He saw no sense in that, because as he put it, he was not selling his home; he was blithely unaware that he would be signing a mortgage deed selling his home to the bank until the loan was paid.

In the past 6-7 years there have been hundreds of thousands of home foreclosures across the land. In some places, like California, if a debtor returns the collateral (hands the keys back to the bank), the debt is extinguished. In most other places, though, returning the keys, or worse yet just walking away from the property, creates headaches and potential headaches to follow a person for years and perhaps the rest of his or her life.

Ownership of real property is a privilege that is taken for granted in the United States. There are few other places in the world where it is so easy to become a land-owner with the rights and privileges available here. With those rights and privileges, though, come obligations. When a deed for title is recorded, the owner of the property becomes responsible for its upkeep, for paying the taxes, and for protecting visitors. When a loan against a property is made, the mortgage deed will spell out the need for the debtor to continue to do those things, or it will provide a means for the lender to do so.

Simply walking away from a home or other real estate because the burden of payment has become oppressive or the shine has worn off the ownership is a very bad idea. First and foremost is the aspect of sin. To promise to pay, and to renege on that promise, is sin. It matters not that one has lost the ability to pay, or that the interest rate suddenly appears usurious, or that the grass is simply greener elsewhere. To break a promise is sin.

There are other consequences that are generally not considered. The bank holding the mortgage will not usually allow the property to deteriorate, and for this reason most high LTV mortgages have escrow accounts to pay the taxes and insurance. If the debtor defaults on his payment, the bank simply continues to protect the property, and adds the cost to the loan. The debtor goes deeper into debt. If the bank does not have such an account, the debtor incurs even greater risk. If the insurance lapses and the house burns, the total cost of the damage becomes the debtor's. If someone trespasses on the property, is injured, and sues, the debtor becomes fully liable for the lawsuit. If the utilities are turned off and the pipes freeze, ultimately the cost of any repairs will accrue to the debtor. If the house is vacant and vandals enter it, damaging it or dealing or manufacturing drugs, the clean-up costs accrue to the debtor. Walking away and leaving the home empty is a recipe for disaster.

Ultimately, after default, the bank generally forecloses. That is not, however, always the case. If damage to the home is great, and taxes have accrued to a considerable extent, the bank may allow the home to be sold at tax sale. The title will transfer, but the debt will not go away. If the bank does foreclose, the house may be sold by the bank at a substantial loss. The proceeds of the sale may not be sufficient to cover the debt plus the legal costs to the bank; the debtor most likely did not read the mortgage papers carefully and may not realize that the debt has not gone away.

I have heard of advice given that there is nothing to worry about in such cases. A prevailing feeling seems to be that the bank will not do much beyond sending threatening notices. This has often been the case until recently. Lately there has been an uptick in suits to recover damages from defaulted borrowers, and suits to recover damages from appraisers who fraudulently inflated values on appraisals so that the loans could be made. There is no statute of limitations for fraud; some of those appraisals were done 6-8 years ago and are just now going to trial. A sleeping dog may look like it is just lying there, but beware that it is not plotting revenge.

My advice to any homeowner who is no longer able to pay on the mortgage is to stay put. Keep the home in good repair. Keep it insured, with the utilities on. If, ultimately, the bank evicts the homeowner in the foreclosure process, the eviction will come after the filing of the foreclosure deed and the bank will have to take the responsibility for upkeep. In some cases, it may even be possible to work out a rental agreement until the bank is able to sell the home. All these things will work to minimize the size of the balance remaining on the debt.

Meanwhile, if the problem is due to not having enough income to cover the mortgage, it will be worthwhile to seek legal counsel regarding filing bankruptcy. I do not recommend bankruptcy unless it is absolutely necessary. It is too often seen as a means of escaping debt. Never forget that even if a bankruptcy proceeding is successful, and protection from creditors is afforded, the debts are not erased. If someone has promised to pay, he is morally obligated to pay -- it is sin to not pay, even if the court states that only a percentage is required to be paid back. Never confuse what is legal with what is right.

Bankruptcy carries a stigma, and it is true that for a number of years it may affect a person's ability to purchase things on credit, or even to rent a home. Eventually, however, the bankruptcy is cleared off the credit records, and life can return to normal. The debtor is required to pay the amounts judged by the courts, and can also arrange to pay the debt in full as opportunity arises. It is not a good thing to endure, but the debtor is protected so he can do what is right in the course of time.

But what if the debtor decides to not seek bankruptcy? What if the debtor allows the lender to proceed with a suit for judgment? Some people say this is not likely to happen. I say, it is more likely than not to happen. In such a case, without the protection of a bankruptcy judgment, the lender is free to garnish the wages of the debtor until the debt is paid. There may never be enough money left in such cases for the debtor to start over and get back on his feet. The judgment may follow him all his life; it will also touch the lives of any people who might enter into contracts or relationships with him. Deficiency judgments are meant to be punitive. Avoid them if at all possible.

Striking back at The Empire

One of the unique aspects of America has been her historic position, based in the Torah, of "Equal justice under the law." (viz. Ex. 23:2-3,6; Lev. 19:15, 24:22; Dt, 16:18-20). There are those of us who have bound ourselves to uphold our Constitution, defending it against all enemies, foreign and domestic. Here is an example of some folks taking that seriously, and making a stand against some domestic enemies of the Constitution :

The Police Loophole

I wonder if the makers of defensive tools, like body armor, will have similar dedication to the rule of law.

Ah, Grandkiddies...

Ah, Grandkiddies... they are a blessing from the LORD.

As we spent some time hanging out with Jim & Stella last night, Beloved Rib helped Amelia and Samantha with their "artwork". She approximated my self-portrait, but with green marker. Samantha eagerly came to show it to me.

Me : "You colored my hair green!"

Samantha : "Grandpa, you don't have hair."

Can't swat them for being truthful, can I?

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Downloaded a copy of Dr. Benjamin Carson's speech at the National Prayer Breakfast on Thursday 2/7/13. Proverbs 11:9, 11:12, 11:25, & II Chronicles 7:14

and just watched it again. Wow.

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Went out to the greenhouse just after noon. Outside temperature about 28° but inside the thermometer was at 65°. Onion seedlings (now nearly pencil-thick) are green, and so are a few scattered lettuce plants. The 30 gallon black garbage can inside the greenhouse, full of water, has just a thin layer of ice on top; the one outside the greenhouse door contained a solid 30-gallon block of ice. Time to start planning the plantings.

The Tuesday night classes at Norton are all Γρίκ to me; but it is starting to make sense.

See ya narrow.

"We must change."

"We must change."

Those were the words of President Obama at Newtown (CT) High School on 12/16/2012. Mr. President, you are right. This nation has become a cesspool of iniquity, and as First Citizen, you must be the first to change. It is as you said,

"No single law -- no set of laws can eliminate evil from the world, or prevent every senseless act of violence in our society.

But that can’t be an excuse for inaction. Surely, we can do better than this. If there is even one step we can take to save another child, or another parent, or another town, from the grief that has visited Tucson, and Aurora, and Oak Creek, and Newtown, and communities from Columbine to Blacksburg before that -- then surely we have an obligation to try. "

The Bible is clear on this; all have sinned and failed to measure up to God's standards. National repentance is in order, beginning at the office of the President.

God demands that nations practice justice. His summary of the sole requirement He lays on mankind is threefold:

1. do justly,
2. love mercy,
3. walk humbly with God.

America, beginning at the office of the Presidency, has refused those requirements. If you want meaningful change, Mr. President, you must lead the way in repenting of both your personal sin and the Nation's.

Do justly. Cease the murder of the innocent unborn. Cease the execution of citizens without bringing them to trial. Cease taking from one group to give to another. Cease showing favoritism based on skin color or belief or political advantage. Equality was a shining attribute of America in days past; let us return to treating everyone equally.

Love mercy. Cease the jailing of citizens, and the confiscation of their property simply because they have been too weak to conform to laws which have been enacted to protect them from themselves. Cease the spending beyond the ability to fund it, which causes future generations to inherit debts which will leave them enslaved. Cease the persecution of individuals who run afoul of laws designed to force social change, and instead use your own example and the soapbox afforded by your position to preach the benefits of caring for our neighbors.

Walk humbly with God. America has done great things with her wealth that was provided by God. This land was blessed with abundant natural resources, beneficial climates for varied crops and enterprises, and a foundation in a belief that God provides all things necessary for prosperity. America has grown arrogant and proud because no other nation on earth has been able to compete against her militarily or economically for almost a century. Pride goes before a fall. God has provided undeserved forgiveness through His grace. He would have us forgive those who have harmed or attempted to harm us, and not try to exact revenge.

You claim to be a Christian, Mr. President? The words of Jesus should affect your behavior. Never forget that He said that if we do not forgive others, we will not be forgiven. Never be so proud to forget that vengeance does not belong to the office of the President of the United States, but to God. Never forget that Jesus does not force people into His Kingdom, but rather invites them. Never forget the most basic message Jesus had to preach -- "Repent".

"These tragedies must end. And to end them, we must change." Indeed.

Prognosis

I do not in the least bit believe that the world will come to an end in December 2012. Frankly, though this world-age [aeon] could come to a crashing end at any second, I don't think it will occur in my lifetime. I guess that what I am saying is that it is more likely that my lifetime will come to a crashing end at any second; I am only a heartbeat from judgment.

Now that thought could be scary. The uncertainty of our lives is one of the reasons Jesus preached about the dangers of slacking off in our Kingdom duties. Today I read the 13th chapter of Mark. Here is what I think is a likely scenario for the future.

As a nation holding out the promise of freedom and justice, the United States is finished. The recent election was the modern equivalent of the man's hand writing on the wall, and the message was the same -- "mene, mene, tekel, upharsin"; "numbered, numbered, weighed, divided". Our national sins have been tallied up, the decision has been finalized, and as a nation we no longer have the unity of purpose to exist as a free people.

What comes next is anyone's guess, but the Glory of America is gone. Jesus warned of wars, rumors of wars, natural disasters, and the rise of evil and deceptive rulers. His prophecy regarding the destruction of Jerusalem in 70 AD and the Temple in particular was only partially fulfilled and waits completion; the horror of the abominable desolation of the city and the destruction so complete that not even the Western Wall remains standing seems yet to come.

The danger to those who call themselves Christian is then evident in His next words, for He tells of deceivers coming in His name, and Daniel speaks of the Little Horn who "shall destroy wonderfully, and shall prosper, and practice, and shall destroy the mighty and the holy people. And through his policy also he shall cause craft to prosper in his hand; and he shall magnify himself in his heart, and by peace shall destroy many: " As Jesus put it, "For false Christs and false prophets shall rise, and shall shew signs and wonders, to seduce, if it were possible, even the elect."

Now I realize that popular opinion is against me in this, since there is that school of thought which holds that Jesus will secretly snatch away all the Believers at the secret sounding of the trumpet and that the elect spoken of here are Israelites and not the Church. They are, of course, wrong. The elect are the Chosen of God, both Jew and Gentile according to Paul, and the warning Jesus gave was to all those who claim to be His disciples.

History tends to repeat itself, and the inhumanity of the Inquisition will doubtless reappear. There will be those who betray their loved ones, because they think they are doing Christ a favor. We may tend to scoff at that idea, but when someone who appears as a savior, capable of publicly working miracles, gives the command to round up those who impede his progress, he will have no trouble finding believers in his cause. Jesus said the love of many would grow cold; Paul said there would be a great falling away when the son of perdition would be revealed.

Pause for a moment to consider the havoc that would be worked on our political and economic system if everyone were to follow the teaching of Jesus. Forgiving those who have harmed us would ruin the military-industrial complex, as would doing good to our enemies. Refusing to be covetous would ruin the bankers. Insisting on chastity would destroy a good portion of the entertainment (or what passes for entertainment) industry. A side effect would be the ruination of most of the lawyers.

If a wonder-worker providing food and world peace came on the scene and said that those who didn't support his program had to go, does anyone doubt he would find willing hands to do his evil work? If someone who claimed to be the Son of God, performing miracles as proof of his deity, commanded his followers to kill anyone who refused to obey him, do you think that there would not be many who would be deceived enough to do his bidding? Jesus said it would happen. There will be many professing Christians that will be seduced; the elect will refuse to fall for it and will pay with their lives.

Jesus warned His disciples not to slack off in well-doing. He gave to each of His own some work to do, and if anyone needs to be reminded of that work, he needs only read Matthew chapter 5. Those are the talents the Master left with His servants. They are sand in the gears of the mechanism of this aeon.

We need not fear missing the "Rapture" of the church unless it is through our own deception by the False Christ. The dead in Christ are beyond worry, and the living need to watch. We can tell when the Real Jesus appears -- He "shall gather together his elect from the four winds, from the uttermost part of the earth to the uttermost part of heaven." and, as Paul writes, "and so shall we ever be with the Lord". That, however, requires a change -- we will have to leave these bodies behind, most likely but not necessarily as corpses, since "flesh and blood cannot inherit the kingdom of God". Any messiah which appears without causing us to be resurrected is a false messiah.

And now comes the somewhat esoteric part -- the reason I think that the Lord's return is still somewhat distant and that tribulation is near. Space travel. Yes, you read that correctly. I have a hunch that mankind is going to step forward into space, and actually reach out quite far. A false messiah, enforcing world peace, as dictator and controller of the earth's resources, would have the means of channeling the energies of the earth's people into star travel. It would be another of those vain attempts to "reach unto heaven", the dream that was crushed at Babel. Further, the Scripture hints at that possibility, when God warns Israel of the penalty for apostasy -- exile -- but says that if they repent,

"If any of thine outcasts be in the uttermost parts of heaven, from thence will Jehovah thy God gather thee, and from thence will he fetch thee:" Dt 30:4(ASV).

This is repeated and reinforced,

"…but if you return to Me and keep My commandments and do them, though those of you who have been scattered were in the most remote part of the heavens, I will gather them from there and will bring them to the place where I have chosen to cause My name to dwell." Neh 1:9 (NASB).

Thus Jesus tells His disciples,

"And then He will send forth the angels, and will gather together His elect from the four winds, from the farthest end of the earth to the farthest end of heaven." Mk 13:27 (NASB).

Perhaps history will yet repeat itself. When guinea pigs are needed for "scientific" experiments, when expendable lives are required, who else to utilize, but the Children of God? Another Holocaust is on the way. "And ye shall be hated of all men for My name's sake: but he that shall endure unto the end, the same shall be saved."

Treason

From the transcript of the third 2012 Presidential Debate :

SCHIEFFER: "Let -- let me ask you, Governor because we know President Obama's position on this, what is -- what is your position on the use of drones?"

ROMNEY: "Well I believe we should use any and all means necessary to take out people who pose a threat to us and our friends around the world. And it's widely reported that drones are being used in drone strikes, and I support that and entirely, and feel the president was right to up the usage of that technology, and believe that we should continue to use it, to continue to go after the people that represent a threat to this nation and to our friends. But let me also note that as I said earlier, we're going to have to do more than just going after leaders and -- and killing bad guys, important as that is."

With that statement, Mitt Romney failed to make a commitment to renew hope for liberty in America.

When President George W. Bush instituted the War on Terror in 2001 and Congress passed the USA Patriot Act, the jihadists who flew the planes into the World Trade Center towers achieved their greatest victory. They had, through the use of fear, and by arousing a desire for vengeance, caused the United States to begin to devour itself.

Let me remind the reader that the Amendments to the Constitution of the United States, as they were passed in order of time, overrode any prior portions of the original Articles, including the powers granted to Congress, the President, and the Judiciary. That was the purpose of amending the document. Thus we have the following :

Amendment 4 - Search and Seizure. Ratified 12/15/1791.
The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

Amendment 5 - Trial and Punishment, Compensation for Takings. Ratified 12/15/1791.
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

Amendment 6 - Right to Speedy Trial, Confrontation of Witnesses. Ratified 12/15/1791.
In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law, and to be informed of the nature and cause of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor, and to have the Assistance of Counsel for his defence.

The War on Terror, as prosecuted via the USA Patriot Act, violates in numerous places the above three Amendments, and is clearly unConstitutional in that respect. Evidences of warrantless searches and seizures, of indefinite detention without habeas corpus, of arrests based on secret testimony; all these are commonly reported in our daily news, with no resistance to the tyranny by those sworn to uphold the Constitution and defend it against all enemies, foreign or domestic. Those hired to protect have been the most egregious violators.

The Obama Drone Policy, of which Romney said, "I support that and entirely, and feel the president was right to up the usage of that technology, and believe that we should continue to use it, to continue to go after the people that represent a threat to this nation and to our friends." has been used to sentence U.S citizens to death without trial. Further, the desire of the current administration to expand the use of drones worldwide against persons who are United States citizens, is an act of treason against the United States, since it gives aid to an enemy whose desire is to destroy our Constitutional protections.

Frequent mention has been made that this election is mostly about the economy. To the average voter, that is probably true, but what is also true is the undeniable fact that the collapse of our economy is inevitable. It will not matter who has won the Presidency. Whether we go forward into ruin under the policies of Obama, or in spite of the 5-point plan of Romney, whoever sits in that chair will face the responsibility for the failure.

America has, however, endured poverty before. The difference was that before, Americans enjoyed liberty under their Constitution. The poverty of free men has a much different feel than the poverty of slaves under tyranny.

It will not matter who wins this election; neither major candidate is a champion of liberty, and Americans will get the government they deserve. America has thrown away a gift from God, and the consequence will be one more chance to seek repentance on our knees.

Barack or Mitt?

I'm not at all in favor of continuing the status quo of the U.S. government. For most Americans, the choice comes down to one of two contenders, with the argument made that failure to vote for one of the two is simply a wasted electoral exercise. There are serious considerations tied to the upcoming election, and there are certain facts which need to be examined before leaping off into the ballot booth.

I. The economy. The Democrat (Socialist) Party incumbent would have us believe that all will be well if we just continue to borrow money. What is not discussed is the fact that money is a portable substitute for goods and services. If money is printed without any backing other than a promise to pay, and the people who own broken promises stop accepting them, the system propped up by that money must collapse. The challenger has offered some ideas that would slow down the breaking of the promises, but not eliminate them altogether. Further, sober number-crunching shows us that as a nation we have already passed the tipping point for economic collapse. The patient is terminally ill, and we aren't making funeral arrangements yet. When he dies, the body will get stinky in a hurry. Get ready.

2. Personal freedom. The status quo is a movement toward greater restriction and control of individuals and their liberty. The Democrat position is that might makes right; individuals must be subordinate to the will of the majority or face being beaten into subjection. The Republican (Whig) position is that the central government has the privilege of dictating uniform laws across the land; if you are not for them, you are against them, and if you are against them, you face being beaten into subjection. Not much choice of outcomes there.

Helping my mother fill out her absentee ballot the other day -- and no, I did not tell her how to vote, but simply made sure she followed the instructions for filling out the envelope -- I was made aware of the number of choices available on this election's ballot. (From the Summit County BOE website).

• Stewart Alexander/Alex Mendoza (Socialist)
• Susan E. Daniels/Jerry A. Veneskey (Write-In)
• Richard Duncan/Ricky Johnson
• Virgil Goode/Jim Clymer (Constitution)
• Gary Johnson/James P. Gray (Libertarian)
• Nelson Keyton/Jay Jennelle (Write-In)
• Barack Obama/Joe Biden (Democrat)
• Jill Reed/Tom Cary (Write-In)
• Platt Robertson/Scott Fall (Write-In)
• Mitt Romney/Paul Ryan (Republican)
• Jill Stein/Cheri Honkala (Green)
• Randall A. Terry/Cathy Lewis (Write-In)
• Mike Vargo/Jeff Angeletti (Write-In)

Quite an array. We have a fairly clear idea where the Democrat and Republican candidates stand on things, but what of the others? Let's take a look.

Write-Ins & Independents. Those aren't actually write-ins; they are real ballot choices. I have no idea what they stand for. They don't seem well enough organized to actually be effective presiding over the United States.

Socialist Party : "Socialism and democracy are one and indivisible." That is their party line. Socialist Party USA. Prepare to be assimilated. Ugh.

Libertarian Party : "We hold that all individuals have the right to exercise sole dominion over their own lives, and have the right to live in whatever manner they choose, so long as they do not forcibly interfere with the equal right of others to live in whatever manner they choose." That's a nice sentiment, but, personally, I don't subscribe to it, because I know that God will bring us all into judgment. Libertarianism sounds good as long as the fine print is ignored. God ordained government to hold libertarians in check. Libertarian Party 2012 Platform. Sorry, I don't buy this.

Green Party of the United States : "We are partners with the European Federation of Green Parties and the Federation of Green Parties of the Americas." Wonderful. These folks believe government should control everything -- a sort of Anti-Libertarian party -- with the ultimate authority seemingly the UN General Assembly. 2012 Green Party Platform . Run away! Run away!

Democrat Party : "Democrats believe that we're greater together than we are on our own." That's why Mr. Obama can say that an individual cannot succeed without government help. Democratic National Platform. If you are tempted to vote for these guys, read the platform carefully. They spend more time bashing Republicans and bragging about how they spent borrowed money than setting forward their political theory.

Republican Party : "The American Dream is a dream of equal opportunity for all. And the Republican Party is the party of opportunity." Sounds good, and the Prez/VP candidates seem to be men of good character. But … a part of their planned reforms is "…reversing the undermining of federalism…." 2012 Republican Platform . Sounds good, but not quite good enough.

Constitution Party : "The goal of the Constitution Party is to restore American jurisprudence to its Biblical foundations and to limit the federal government to its Constitutional boundaries." Constitution Party National Platform. I guess these folks are as close to what I believe as anybody out there gets.

So what happens if I vote for Virgil Goode and Barack Obama wins the election? Maybe I should be asking what happens if Virgil Goode wins?

You see, the election is not in the hands of the people of the United States. This nation has invited the wrath of Almighty God, not through the actions of its rulers alone, but through the wanton disregard, by the people, of God's standards. It is God who sets up kings and takes them down. It was God who placed Barack Obama in Washington as a warning and punishment for America's sins.

So, unless there is wholesale repentance on the part of the people of the United States, it will not matter who sits in the White House. God will have put that person there. Despite that person's beliefs or desires, God will deal with America according to its sins. If our vaunted freedoms disappear because of our personal, everyday lifestyles, that is God's justice.

Make the best decision you can based on the facts that you have, and leave the results in God's hands. He can save, whether by few or by many.

Picking My Poison

There are more kinds of stocks than there are colors in a box of crayons. There are low priced and high priced stocks. There are stocks that can be held for income, and stocks that can be held for growth or speculation. There are stocks that are very risky, and there are stocks that are boringly safe. What kinds of companies will I own?

The type of company which a person is interested in buying is a reflection of that person's view of the purpose of investing. It may be helpful once again to visit the story of the beginning. God had created people, and gave to them His first instructions.

1. be prolific in order to fill the Earth with people,and,
2. exercise absolute control over the Earth to maximize its production for the benefit of the people.

Each person must come to grips with his or her own level of submission to those two tasks. My own response to the the charge leads me to invest in companies which produce goods and services, and most specifically, goods and services of the types which I find myself using in the course of life. Utilities, manufacturing companies, food production, pharmaceuticals, transportation; all these sectors are comfortable in the sense that I feel myself to be providing benefits to other people.

Where a company is located is also a matter of interest. When I invest in a company, I provide it with operating capital which allows it to expand operations and ultimately provide jobs for other people. If I feel a higher level of concern for the people of my own nation than for people in far off places, i will tend to invest in more local companies.

The type of return and the long-range goal of my investing will determine whether I choose stocks which tend to grow in value in and of themselves, or stocks which pay out higher percentages of the company profits in annual dividends. A determining factor in choosing a stock will be its price history over a period of several years. If I wish to speculate -- gamble if you will -- by trying to buy low and sell high, the dividend history of a stock will be of less interest than its price history. If I wish to maximize an income stream from my investment, the ratio of the dividend to my purchase price will be a more important factor.

So, then, some general guidelines which I have formulated for my own holdings:

1. The investment must be morally sound. I will not invest in products or services which I feel do not contribute to the betterment of my society. Shares in casinos or cigarette companies are not even on the radar because of their records of destruction of human lives. Neither are insurance or finance companies, since those entities generate their profits through fear and usury. You might be shaking your head at this point, since those kinds of companies frequently offer the highest rates of return. I reserve the right to judge the righteousness of my own investments, and pay the penalty for my judgment.
2. The investment must pay a dividend. If I am to be an owner in a company, I want it to make a profit, and when it makes a profit, as an owner, I feel entitled to my part of that profit. Dividends can be tricky; the higher returns often are a sign of higher risk.
3. The investment must be affordable and such that downward changes in price are not likely to cause excessive mental stress. I choose cheap(er) stocks for two good reasons. The first is that if two stocks are paying the same amount of dividend annually, but one is half the price of the other, the rate of return for the lower price stock is twice that of the higher. Simple math, but often ignored. The second reason has to do with the volatility of the stock market and the possibility of being forced to liquidate a position in a down market. If the price of a stock declines, say 30%, I will lose far less of my initial investment in X shares of a cheap stock than I would in X shares of a high flyer. I am loathe to spend more than $40/share. While some of my stocks are currently trading in the mid-$70 range or above, I bought them at about $40, and I will not buy any more of those stocks while they remain so expensive (although I will probably let the dividends be reinvested).

So what do I own at this time? What I am about to tell you is not to be considered a reliable guide to making money. You are about to view my idiosyncrasies, and if you attempt to duplicate what I have done, you may loose your shirt (along with the rest of your clothing). Thus, in order of my capitalistic meanderings:

AIVSX - The Investment Company of America. This is my only mutual fund, originally recommended by Mark Novkov. I hold it simply because it has sentimental value. It is also growing, and if you take pleasure in watching trees grow or racing turtles, this one is exciting. It does seem safe, though.

D - Dominion Resources, Inc. My natural gas supplier finally convinced me that I should buy its stock and get back some of my heating bill money. As the price has gone up, the dividend yield percentage has shrunk a bit; it is now a hair over 2%. Still, winter comes once a year to this corner of the globe, and I see a future for furnace fuel far into the distance. I bought it in late 2008; it was at about $35 then.

SJM - I originally bought Smuckers at $42.24 per share, a steep price for me, but since we drink Folgers coffee, eat Jiff peanut butter, and bake with Crisco, it seemed like the right thing to do. While it pays $1.92 annually, it traded over the last year from $60.46 to $80.25, and if it wasn't for the Folgers, I probably would have sold it. I can't justify spending any more money on this one; it is now too risky for me.

PFE - Pfizer was not purchased because it produces Viagra. At the time I bought it, it was paying a 32 cent quarterly dividend, or about an 8% return. When the dividend was cut to 16 cents, the price plummeted, but it is now back up to 22 cents, with a current return of about 3.6%.

KMB - Kimberly-Clark makes Scott toilet paper. 'Nuf said. What goes in, must come out; there will always be a need for toilet paper. I bought a few shares at $58 and cannot justify buying more at today's prices, but the dividend is hefty enough to register about a 3.5% return.

WIN - Windstream is a telcom stock. I was driving around Geauga County, seeing Windstream Cable vans everywhere, and decided to buy. My initial 100 shares were purchased at $14.21, and over the last year it has traded in the range of $10.76 to $14.40. The dividend, however, is $1.00 annually, or 7% on my initial investment, and being in a DRIP, it has grown to the point where if I had to sell it, I would likely break even on my initial principal. If I hold it and let it grow, it will, in a decade or so, be a handsome income stock. As of September 24, the dividend return is just over 9%.

FE - FirstEnergy is an electrifying stock. Yuk-yuk-yuk! Hey, same idea as Dominion, here. I have to light my bulbs, I may as well pay myself for the favor. Paying about 5% now.

CAG - Conagra Foods makes ACT II popcorn, Hebrew National hot dogs, and Swiss Miss cocoa. Gotta have it. Returning roughly 3.5%.

LYTS - I purchased 100 shares of LSI Industries at $7.26; it pays 20 cents annually for a 2.75% return on my initial investment, and roughly 3.5% at current prices. However, it is in a Dividend Reinvestment Program, and over the last year has traded in the range of $5.85 to $9.61. It is a park-and-forget stock. I bought it because I was intrigued with the electronic billboards that LSI makes. Besides, it's an Ohio company. Have to keep the neighborhood employed.

RPM - Rustoleum Products, anyone? Another neighborhood business, paying about 3%.

GRC - Gorman-Rupp Company. Hmmm. I bought this to show solidarity with my son-in-law. Have to keep him employed. Good thing this stock did a 5 for 4 split soon after I bought it. Still under water, and only paying about 1.4%. HOWEVER. It has some strong points, like almost zero debt, and a huge market for its industrial pumps. Tortoises belong in every portfolio. It was purchased for the long-term, though, and is (to me) a prime example of the idea of exercising the Genesis 1 requirement.

FTR - Frontier Communications is another communications holding, bought initially at $5.95 and paying 75 cents annually, or 12.6%. It has had a 52 week range of $5.33 to $9.84 and is being held for income. Although the quarterly dividend was cut to 10 cents, it is still putting out over 8.5%.

ALSK - Alaska Communications. What? Yep, a cheap dividend stock. Looks like a loser, but when something is this cheap and paying 8% - 9%, you buy lots and hang on. Besides, they nearly have the wireless spectrum cornered in Seward's Folly. I can live with this risk.

DOW - The Dow Chemical Company. Better living through chemistry. I'll buy that. I did. Paying about 4%.

OLN - Every feller needs his Winchester. Buying this was an American thing to do. Besides, it pays about 3.5%.

TNK - Teekay Tankers is a company for us oil speculator types. Of course, all we do is fill up the big tubs and sail them from place to place. As long as the return is in the 10% - 13% range as it has been this year, I'll anchor some money here. This is one where the dividends have outweighed the loss in principal over the course of the year.

NM - Navios Maritime Holdings is a Greek owned bulk carrier with a huge modern South American terminal. Somebody has to feed the world; we deliver the food. And other stuff. They were a cheap buy, and the dividend is about 6%.

CSX - Well, I couldn't afford the Reading or the B&O, so I bought CSX since it was cheap and had a cute internet commercial. It is paying about 2.6%. The graph for this one shows why being a day trader is a sure cause of heart attacks. In this rodeo, you get on and hang on. We will always need our choo-choos, and I will probably buy more of this in the future.

I see only one legitimate and constructive way of "occupying" Wall Street. Buy stocks.

Why Stocks?

Having stated my defense for the activity of investing, and the history leading to my involvement, I need to answer the question, "Why stocks?"

I will not say that investing in stocks is the only or best way to practice capitalism. There are many people who prefer to invest in other types of privately held enterprises such as rental real estate, or other entrepreneurial businesses. Such investments may seem to provide larger gains. Investment in real estate, prior to the financial collapse of 2006-2008, actually appeared to be a superior type of investment. There are, however, great risks involved; it should be remembered that the higher the rate of return, the greater the risk associated with the investment.

While investing in rental real estate may seem to produce a high rate of return, all of the factors that bear on the investment need to be considered. In appraising rental property one of the critical errors observed has been the underdevelopment of replacement reserves, because small landlords rarely anticipate depreciation of their property. (After all, haven't they been told repeatedly that real estate always appreciates, and never goes down in value?) Over an anticipated 30 year life of a property, the roof, furnace, and windows can be expected to require replacement at least once in order for the building to hold its value, and water heaters are notorious for their less-than-10-years lifespans. Carpet, paint, landscaping -- these are all robbers of profit.

Vacancy rates are rarely studied by budding landlords, yet the lack of cash flow created by a two-month vacancy has resulted in many a foreclosure. A landlord may buy a house to rent for $100,000 with $20,000 down, and find that over 30 years, at a 5% interest rate, he has paid $155,000 in principal and interest to the bank, plus taxes and insurance and maintenance costs. If he anticipates $800/month for 30 years ($288,000 gross rent) to be offset by the loan ($155,000) plus taxes ($2000/year) plus maintenance ($1000/year) and sells the house at the end of 30 years for near his original purchase price (a not uncommon thing in many Mid-western towns), he may find that his $20,000 would net about $143,000.

This would require that the landlord pay out about $680/month from the gross rent, and assumes no vacancies -- an ideal situation. In reality, there would be some months when due to vacancies and repairs the landlord would be paying out of pocket. It also assumes that the landlord will be directly managing the property himself. If a management company is needed, it can be expected to demand about 10% of the annual rent as its fee, which would reduce the net by just under $29,000, to about $114,000, and the impact of a typical 5% vacancy rate would bring the net to about $100,000.

That is not a bad return on a $20,000 investment over 30 years -- roughly 17% annually, and the landlord is providing housing for his tenants. However, there are still risks involved -- unplanned assessments or repairs, changes in the neighborhood which might affect appeal and rentability, and the possibility that property values might decline near the time of final disposition of the property. There is also the very real problem that real estate investment is not very liquid, and having to sell real estate under compulsion can be disastrous.

To be fair, there is also the possibility of a significant rise in real estate prices; that has been the dream of many a real property investor. There is also the possibility that market rents could increase in such a way that the monthly cash flow would make a very comfortable addition to ordinary income. Still, the percentage of would-be landlords who actually make a net profit on their residential rental properties is in reality very small. To be a successful small-scale landlord requires the ability to repair and maintain dwellings (or the willingness to hire someone else to do so) and excellent people skills in not only interviewing and initializing the rental agreements but also dealing with less-than-ideal or deadbeat tenants (or, again, the willingness to pay someone to do that for you).

Few people have the ability to successfully manage residential rentals, and to subcontract the necessary management to others requires a different set of skills possessed by an even smaller population of investors.

What then of other investment vehicles? Since the post-WW2 recovery, many mutual funds have track records over the lifetime of the fund returning about 12% annually. A $20,000 one-time investment left to grow at 12% would yield about $720,000 at the end of thirty years. I wish that had been impressed in my head back in the days when I was single and was making more money than my Dad.

In fact, a fund returning only 10% on the same size initial investment would yield about $400,000 at the end of 30 years, and would be throwing off dividends of over $10,000 per year -- a very nice supplement to Social Security indeed -- without even touching the principal. Or having to deal with tenants!

In contrast, the $20,000, if placed in stocks paying 4% annual dividends reinvested quarterly, would yield a net of about $66,000, assuming no stock splits over a 30 year period, and again, assuming no increase in the share value. The dividends on that sum at 4% would be only $2600 per year. Why, then, would I choose stocks over real estate or mutual funds as an investment vehicle?

I mentioned in a previous post the fact that fund managers, whether for regular or tax-deferred accounts, charge for their services. Indeed, the managers of well managed funds deserve every bit of the fee they charge. However, aside from the ability to vote for the directors of the fund at the annual meeting, the shareholder has no input into the decisions made regarding the investments. If you look at the composition of most of the best performing growth-and-income funds, the largest holdings will be in financials (banks and insurance companies) and companies which produce beverages (the adult kind) and tobacco.

I have an aversion to supporting either. That may make me a hypocrite with respect to the adult beverages, since I buy and consume them, but I don't feel right about producing and selling them to the general public. In the wrong hands, alcohol and tobacco can be (notice -- I am avoiding total condemnation of them) destructive to the Project Earth workforce. I prefer to err on the side of caution. Likewise, I prefer to avoid the financials because of their role in enslaving that same workforce.

So why stocks? There are several practical reasons, one being that a shareholder does not have to manage the company directly. He doesn't actively participate in the business, and is not legally liable for the company's actions. Another is the liquidity of the investment -- not only can he buy the interest in the business in small chunks, but he can also dispose of it in the same way. A third reason is that the investment can be spread over several sectors of the general economy -- a means of keeping all your eggs out of the same basket.

There are also altruistic reasons, the reasons which are most important from the standpoint of stewardship of God's Project Earth. As a shareholder in a company, you are an owner. You provide work for the employees of your company, since the capital you have injected helps maintain the cash flow. As an owner you also have the ability to influence the moral direction the company takes. Granted, your influence is only proportional to your ownership, but it can still be brought to bear.

Finally, there are the fun reasons. When you invest in a business, you tend to try to find out how it works. You develop an interest in the factors that drive that trade. You find yourself examining the issues that affect the workers you employ. Your horizons broaden; my portfolio makes me an energy baron, a food supplier, a telecommunications provider, and a shipping magnate, to name a few sectors. My Suezmax tankers are bigger than your pleasureboat, are they not?

I hope that no one reading this takes these ideas as points of dogma. I see nothing wrong with investing in real estate; it just isn't "my bag". There is nothing absolutely wrong with mutual funds; I simply prefer to control a bit more closely what my money is doing (and I do own shares in a fund which carries between 3-5% of its investments in financials). I just have a preference for industrial holdings from the stand point that making useful things seems to me to be a good way to exercise dominion over the Earth.

How then, do I chose which companies to invest in? We will look at that next.

How I Became a Dirty Capitalist

Life is evolutionary in the broadest sense of that term. Constant change occurs, both qualitatively and quantitatively, and that change is directed by God. (I do not believe in randomness as a pure function of existence, for while randomness is a useful mathematical concept and tool, much on the order of imaginary numbers, it is simply a subset of a more complex, highly directed universe. Entropy is not a proof of randomness, but an evidence of direction in existence.) God set up His creation at the highest level of organization, set mankind within it to maintain it to the best of their ability, and gave to people sets of goals and limits to maximize their success in Project Earth.

God also intervenes in the affairs of men, a function which was often described by people of an earlier time as "Providence", but which needs to be understood as something like a number line, where values can be perceived as either positive or negative, depending on a person's relationship to the zero point. Those who lack a proper relationship with God may find fault with "negative Providence", but in every instance, that which is "negative Providence" for one person will in some way be "positive Providence" for someone else. The truism is that, for those who love and respect God, everything is working to achieve God's intended goal.

I admit I am a neophyte in the world of capital investments. It was not until I was 44 years old that I began to invest in stocks, and that happened in an evolutionary sort of way.

I was always impressed by my father's ability to make do with a relatively meager income. He came of age at the start of the Great Depression. Graduating from high school at the beginning of FDR's regime, he felt extremely fortunate to have a job where his talents were totally unappreciated. Although he took college preparatory courses in high school, he had no money for college tuition; he would spend his life as a laborer. I remember him counting his pennies at the end of each day, journalling his expenses.

Dad kept track of every cent, and was not about to risk what he had in a stock market that he had been led to believe was not worthy of trust. Conventional wisdom of his time held that stock market investment was merely a form of gambling. His tales of the Depression and his own experience with stocks colored my perception of such investments.

There was little effort put forward during my schooling to explain that ownership of stock was ownership of the industries that employed people. Those were the days when public schooling was keyed to turning out workers rather than owners. Not much has changed since then, I suppose. As a teenager in the 1960's, my teachers were liberal in their persuasion and my life philosophy was a crazy amalgam wherein I viewed "big business" -- my perception of capitalism -- as somewhat "dirty". Further, my religious orientation at the time was such that it seemed wrong to be laying up treasures on earth. (Laughably, communism -- the doctrine of community ownership of capital -- was railed against but its tenets could not legally be taught in public schools. Had it been properly taught and contrasted with private ownership of capital, the socialistic leanings of the political power-mongers would have been exposed for what they were.)

In the mid-1950's the company Dad worked for instituted a profit-sharing plan in which the customary annual bonuses would be invested in the company's stock. Dad went along with it simply because he had no choice. In 1962, faced with the physical necessity of getting out of the meat coolers or dying, he accepted a job, at minimum wage, with Myers Tire Supply. Due to his financial necessity -- a new house, new car, five kids -- he persuaded his old company to give him the principal amount he had invested (via unpaid annual bonuses) in their profit-sharing plan.

His old employer grudgingly gave him the money, but only to the limit of the principal amount of the bonuses he was entitled to. A few months later that company filed for bankruptcy protection; to Dad's knowledge, he was the only employee that saw anything out of the profit-sharing plan. Thus he was extremely skeptical when Uncle Bill urged him to participate in Myers' profit-sharing plan, but he agreed to try it. Unknown to us was the future, in which dividends from Dad's steady investment in Myers stock, with its occasional splits, would form a small but welcome addition to Mom's income beyond Social Security.

My true education in economics began in the late '80's, as I struggled to maintain a business with employees. I had never before been faced with the problem of cash flow in a situation where the livelihoods of others was at risk. Not only was my position with regard to the role of capital fiscally disastrous, it also became apparent that it was at odds with the more important tenets of my faith. You simply cannot share or give to others that which you do not have.

In 1991, hearing stories of money to be made, I succumbed to temptation and invested $1000 in BCCI -- the Cayman Island Bank. Dad and Mom had taken out a $500 life insurance policy (through Prudential) for me when I was a newborn; over the years the policy amount had swelled to over $3000 and I was able to scrape up the cash by borrowing against the policy. Shortly after the investment was made, the assets of BCCI were seized. By the grace of God -- Providence -- a limited amount of principal was recovered. To put it in a safe place, my brother-in-law, Mark Novkov, reinvested it for me in a mutual fund, the Investment Company of America (ICA).

I knew nothing about mutual funds, their investment strategies, or their management. ICA, however, was a company with a long track record, and I was pleased with the dividends that began to be reinvested every quarter. Investing in the stock market was something I was now willing to try, but I was uncertain how to find a broker. Besides, we were financially strapped, paying back money that had been borrowed to pay ruinous Federal employment taxes, medical bills, and to keep my business afloat. Most years, I had no spare cash to even make more than token repayments on the principal amount of the policy loan; for some years I was able only to make the small required annual interest payment.

Then, in 2001, Prudential de-mutualized and issued stock to each of its policyholders. I was issued 24 shares. I cheerfully accepted my annual dividend check, which offset the annual interest on the policy loan. In 2003, I was hired as staff appraiser by Charter One Bank, and for the first time in years my income allowed me to make substantial progress in eliminating my debt. Also, the company matched employee investment in its profit-sharing plan, and I took advantage of the opportunity to get some free money.

When Charter One was bought out by Royal Bank of Scotland in 2004 and all the appraisers were let go, the amounts I had vested in the profit-sharing plan were rolled into IRA mutual fund accounts, but ICA was not an available choice through the IRA manager. I was introduced to several other mutual funds, and learned that IRA accounts were not free. IRA account managers collect a percentage each year from the accounts. This is not a problem when the funds in the IRA are growing and producing income, but if the funds show a loss, the IRA account will be charged for the manager's fund. That worried me, since, as an appraiser with a grasp of how mortgage financing was supported in the marketplace, I was well aware that the economy was overheated and ready for a downturn.

Additionally, all of the dismissed former Charter One employees had been given stock options as part of the buyout package. The company that would manage my RBS stock options was Computershare, which was also the agency used by Prudential for stock management. I logged into Computershare's website, set up my account, and discovered that I could buy and sell stock through them. They would act as agent, holding the shares in my name, and would reinvest any dividends according to my instructions. The stage was set for my entry into the World of Wall Street.

While part of the Charter One severance package was full vesting in all profit sharing, another part was the granting of options on Royal Bank of Scotland stock. The package gave me an option on 150 shares at £15.53, to be exercised between September 1, 2007 and March 31, 2008. In early 2007, as the advance ripples of the global banking meltdown began to trouble the banks, the Plan was altered with a 2-for-1 bonus issue; I was then holding an option on 450 shares at £5.1766 per share.

Needless to say, I became extremely interested in the price of RBS stock in 2007, and realized that due to the European bank meltdown (which I had been expecting for some time, although I was frustrated that no one else seemed to see it) exercise of the options would be touch-and-go. In February 2007 RBS hit its high of nearly £6. On March 21 it was beginning to slide, at £5.80. On September 14, 2007, the stock was at £4.56; if I wanted to exercise the option, I would have to pony up £277.47, or about $550 at current exchange rates. By March 20, 2008 RBS was at £2.75 and my options would have cost about $2,100 to exercise. I was not impressed, and in what I now consider to have been one of my finest hours, I let the options expire. Today RBS is trading at about £0.25. Good riddance.

There was an upside to that experience. While doing all that sleuthing in the markets, I also discovered that Dominion Energy, our natural gas supplier, had a program whereby its customers could purchase Dominion stock directly through them, and Dominion would reinvest the dividends (or send a check, whichever you might prefer) at no cost to the shareholder. I began to look for ways to come up with cash to open an account through Dominion Direct. My rationale was that as a Dominion customer I might as well get some of my heating bill money back as dividends.

A second discovery was that Computershare, as agent for a number of companies, offered a long list of stocks which could be purchased directly, and many of the companies which used Computershare would also pay any brokerage fees for the reinvestment of dividends. Throughout 2008 I studied a number of stocks available through Computershare, looking for companies which paid good dividends and which also paid the reinvestment fees. In late 2008 I took the plunge, buying 100 shares through Dominion Direct, and investing $1,000 in J. M. Smucker (we drink Folger's coffee and eat Jiff peanut butter) and $500 in Pfizer (seemed to be a low priced stock with a good dividend) via Computershare.

Throughout 2009 and 2010, the interest rate on our passbook savings account steadily declined. I began to look for an alternative bank. ING was recommended. In August 2010 several events occurred which would trigger a bank switch.

The funds in my IRA account had been a choice made when I had no known options for a different type of investment, and they were weak performers. They were also subject to annual management fee charges, as I mentioned above. Those accounts had lost heavily in the 2007-2008 downturn, but in mid-2010 they perked up and regained to the point that they were worth, in August 2010, what they had been worth two years earlier. I decided to sell and reinvest in stocks that had a track record for good dividend performance.

ING offers its depositors a brokerage account called Sharebuilder. Sharebuilder differs from Computershare in that Computershare is an agent which holds the stock in the name of the purchaser whereas the Sharebuilder account is a brokerage account which holds the stock for the depositor. Also, Computershare executes trades on set days of the month, whereas the Sharebuilder depositor is able to make trades in real-time and has more choices as to available stocks. If the investor chooses, shares purchased in real-time (at opportune prices) can be transferred from Sharebuilder to Computershare. There are valid reasons for holding the shares in either account, depending on the type of strategy the investor wants to use for growth or trading.

I deposited the funds from the sale of the IRAs into an ING Orange account which I then linked to a Sharebuilder account. Instead of the 0.84% that FirstMerit was currently paying, ING Orange was paying 1.10%. Further, the first purchase I made through Sharebuilder was for 100 shares of First Energy, which currently has a rate of return of about 5.2%. ($2.20 annual dividend on today's [1/18/2012] close of $41.97 per share.)

It isn't all gravy. There are dangers in investing in stocks. There are no guarantees that a company will stay in business or even make a profit. The day I bought my 100 shares of First Energy (at $39.33), the stock price tumbled almost 10% immediately after my purchase and only very slowly recovered over a period of several months. Had I made the purchase for speculative purposes, it would have had to be viewed as a huge loss, but because I am looking for long-term growth and income, I am confident that the investment is sound.

Owning part of a company brings to the shareholder the same kinds of concerns a sole proprietor faces on a daily basis, but usually without the urgency. It can also bring the satisfaction and reward that comes with successful business performance. I have learned a lot in a short time, and have formulated some concepts that I would like to pass on. Remember though-- there are no guarantees in stock ownership, and I, myself, am still learning on a daily basis.

Some Moral Implications of Capitalism

My view of motivation in life is that all of a person's actions are driven by that person's belief system. Every human, whether a devout worshipper of a deity or an atheist, is religious, because there are certain fundamental things which every person simply assumes without proof, and that is the essence of belief. Thus it is that a person's true religion will be revealed in his or her business dealings.

I am a Christian, believing in God Who created and maintains the universe (and thus by logical extension He is not a part of His universe), and Who gave to mankind a set of definitions of right and wrong contained in the Bible. God will, at some future date, judge both the righteousness and the accomplishments (two separate charges) of every person who has ever lived. The Bible assures me of the conditions for my righteousness, and instructs me as to the proper way to attain my accomplishments. For these reasons the arguments which follow may be uncomfortable for many people who do not hold the same beliefs; I can say that because they are at times uncomfortable for me as well.

The Bible begins with a story that is an allegory with respect to human nature. People had been given instruction as to what constitutes proper behavior. They had been given work to do, and were permitted to enjoy their labor and the fruits of their labor, with one restriction -- the property rights of their Creator must be respected. The desire to take what was not rightfully theirs lead to perversion of their assigned task and dissatisfaction with their gain.

That story of the Beginning is a summation of all of human economic history.

God chose one family, that of Jacob the grandson of Abraham, to hold the instructions for morally correct economic activity. Because the members of that family have more often than not followed the instructions, they have tended to prosper financially, and that prosperity has incited jealousy and persecution throughout history. Anyone wishing to know the secrets of economic propriety has only to read the Torah.

At the root level, the instructions teach that God Who created the universe is the ultimate owner and King of His creation. People are both citizens and employees of Project Earth, and the goal of the enterprise is to maximize both the size of the company workforce and its production, using the provided resources. The competition (The Adversary), on the other hand, works to thwart that goal.

Every person born is provided with some capital; each has a function within the company, and each is given, at some time and at some level, abilities, skills, and/or material goods, to invest in the project. I am of the persuasion that the gifts of The Almighty allow the individual to use the given abilities to develop skills to maximize the capital.

Because the capital is a distribution in trust from The Almighty, absolute human ownership of the capital does not exist. Each human is a steward of some portion, small or large, of the capital intended for the operation of the enterprise. Further, the hoarding of capital, whether the withdrawal of land from the production of food, the failure to use a medium of exchange to encourage work by others, or the restriction of the use of new ideas so as to prevent the profiting by others, is a breech of stewardship, thwarting the goals of Project Earth.

Capital is popularly seen as only money, but labor and ideas are equally important kinds of capital. How that capital is utilized within the micro-economic setting, whether through a free-market system or through a planned-market system, will determine its effectiveness because at the core of human nature is dissatisfaction with what we have been given (in trust) coupled with desire for that we lack. Further, the person's view as to the origin of that capital will influence his perceptions respecting ownership, stewardship, and disposition of that capital.

Maximizing the size of the company workforce and its production (which involves employee working conditions) is a basic goal of the project, so treatment of the employees is a critical concern of the owner. Thus rules were formulated -- don't steal reputations, or money, or spouses, or anything God gave to another employee for any reason. In this is seen the importance to the owner of individual workers, and the need to protect and take care of them. It is also the reason for lower, middle, and upper management, positions which God assigns and uses to govern various branches of the company (nations and kingdoms). Politics is thus a subset of economics, and war is destructive to both.

Profit is the result of attaining the goals of the company. The amount of profit is not necessarily significant to a particular work-shift since the company is a long-term operation, but profit is the goal. Jesus told several parables to illustrate that concept. Profit will result in people having more satisfying lives. Therefore, employees of Project Earth who do not invest in the company in some way (again, amount is not the critical factor) will be condemned for that failure. Extending this concept to monetary investment has encountered some resistance among those who fancy themselves morally pure, since the love of money is the root of all evil.

Profit from the loaning of capital is not wrong in itself, but when it impacts the welfare of the employees, particularly through mortgage interest on their homes, clothing, or food, it endangers the goals of the company. For this reason banking is one of those shadow activities with questionable morality. Usury involves the loaning of capital coupled with holding collateral hostage (a mortgage situation). It is described by the Bible as being evil. The collection of interest on money is not intrinsically evil, and may be legitimate where business lending is needed, but no collateral may be held. The antidote to personal mortgage lending is charitable giving; in the words of Jesus, lending without expecting to be repaid.

Investment is quite different from usury in that the purchaser of a share of an enterprise has no anticipation of a repayment except through sharing the increased profits (or losses, as that may be) of the company. If a business venture is formed through selling 1 share of stock to each of 100 investors, each investor is owner of a 1/100 share of the entire business, with the right to collectively dictate how the business is to be run, and to collect 1/100 of the business profits set aside to be paid to the owners (dividends). No individual shareholder can hold the company assets hostage as collateral. If, through the collective decisions of the shareholders, the business fails, they have no recourse, since it can be argued that the failure was a result of inattention by the shareholders to properly control the management of the work at hand. It can also be argued that the minority shareholders are not necessarily responsible for either the success or failure of the business when there is one stakeholder who controls a majority interest.

In the case of Project Earth, God is the majority shareholder, and He delights in profit-sharing with His employees. For that reason He distributes, as He sees fit, the dividends which each employee then is able to plow back into the enterprise. Dissatisfaction with the type and quantity of capital gain distributed by the King is a symptom of rebellion, but the desire to emulate the King, by donating capital to those who might in some way have less, is encouraged and rewarded by Him, often through a grant of a more diverse and profitable form of capital.

You cannot give to others that which you do not have. Profit from the investment of capital is the engine behind charitable giving. However, reliance on charitable giving to meet the needs of those who lack essentials will rarely bring about the satisfaction the recipients would prefer. If the recipients of such charity fail to find a suitable investment venue in turn, their gift will merely extend their misery. Coveting what another person has is evil, whether the covetous person has little or much. Those who have are expected (but not obligated) to share with those who have not; God will judge the adequacy of their donation. Those who receive a gift are expected to be satisfied with what the donor shares; God will judge the level of their thankfulness. Jesus implied that equality of opportunity is not the same as equality of participation; opportunity would be provided regardless the amount of capital a person would start with. Equality of results is not guaranteed.

What is the function of upper management (the government) in all this? It is to provide oversight of the conditions under which the size of the company, the amount of production, and the level of profit, can be maximized. While the ability to govern is a form of capital, management is not ownership; when management attempts to judge the actions of the shareholders, particularly with regard to disposition of the profits, it risks being replaced by new management more conducive to the desires of the owners. Management which reduces production by starving the enterprise of workers (either through reduction in actual numbers or by discouragement of inflows of new investment capital) and/or resources (by refusing to make them available) is being subversive and will be judged accordingly.

Applying these concepts to individual action leads to the conclusion that surplus capital should be invested in gainful enterprises whenever possible in order that it might be multiplied and ultimately used to provide for those whom God might direct to the individual for assistance. Again, you cannot give to others that which you do not have, and failure to invest carries greater condemnation than investing and failing.

Alas, Babylon!

When the book with the above title was published just over 50 years ago the Cold War raged; the United States was the champion of freedom and Godless Russian Communist atheism was seen as the enemy of that freedom. The worm has turned. To everything there is a time and a season. Last night was Christmas Eve in Russia : the readers of ITAR-TASS 50 years ago would have stopped their breath in wonder.
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Medvedev congratulates Russian believers on Christmas
Photo ITAR-TASS

MOSCOW, January 7 (Itar-Tass) — President Dmitry Medvedev has congratulated Orthodox believers and all Russian citizens marking Christmas.

“The Christmas days give us eternal light of belief and fill us with joy and hope. This is the time of good thoughts and good deeds, care about family and unknown people who need our helping hand,” he said in his congratulatory message.

“Sharing with you the joy of this holiday I wish you health, happiness and all the best. Let the light from the Star of Bethlehem bring happiness, love and harmony to every family and prosperity to our country,” Medvedev said in his message.

© ITAR-TASS. All rights reserved.
You undertake not to copy, store in any medium (including in any other websites), distribute, transmit, re-transmit, broadcast, modify or show in public any part of the ITAR-TASS website without the prior written permission of ITAR-TASS.

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We need only contrast this with the attention paid to Christmas in Washington this past December -- a tree with an Obama Ornament on it.

“12 How art thou fallen from heaven, O Lucifer, son of the morning? and cut down to the ground, which didst cast lots upon the nations?

13 Yet thou saidest in thine heart, I will ascend into heaven, and exalt my throne above beside the stars of God: I will sit also upon the mount of the Congregation in the sides of the North.

14 I will ascend above ye height of the clouds, and I will be like the most high.

15 But thou shalt be brought down to the grave, to the sides of the pit.

16 They that see thee, shall look upon thee and consider thee, saying, Is this the man that made the earth to tremble, and that did shake the kingdoms?

17 He made the world as a wilderness, and destroyed the cities thereof, and opened not the house of his prisoners.

18 All the Kings of the nations, even they all sleep in glory, everyone in his own house.

19 But thou art cast out of thy grave like an abominable branch: like the raiment of those that are slain, and thrust through with a sword, which go down to the stones of the pit, as a carcass trodden under feet.

20 Thou shalt not be joined with them in the grave, because thou hast destroyed thine own land, and slain thy people: the seed of the wicked shall not be renowned forever.

21 Prepare a slaughter for his children, for the iniquity of their fathers: let them not rise up nor possess the land, nor fill the face of the world with enemies.

22 For I will rise up against them (saith the Lord of hosts) and will cut off from Babel the name and the remnant and the son, and the nephew, saith the Lord:

23 And I will make it a possession to ye hedgehog, and pools of water, and I will sweep it with the besom of destruction, saith the Lord of hosts.” Isaiah 14:12-22(Geneva 1560)

On Hornets and Hackers...

It was when I was a newly feathered teenager that we one day discovered in the pine trees on our extra side lot a big hornet nest. Being exceptionally bright cookies, my brothers and I decided that it would be bad medicine to disturb that paper metropolis from up close. Being exceptionally mischievous malingerers, we also craved the excitement of demolition. Besides, everyone knows hornets are evil; harassing them would be a good deed. The solution -- we stood back about 50 feet away and shot into the nest with our BB guns.

Did you know that hornets can detect the direction and angle of fire of projectiles at significant distances from their source? We learned something new that day; a victim will only be a victim until he discovers a way to turn the tables on his tormentor.

On Christmas Eve the Internet terrorist organization known as "Anonymous" reportedly broke into the database of Stratfor Global Intelligence, a company that does news analysis for a world-wide client base. The terrorists stole subscriber usernames and passwords, gained access to their credit card accounts, and ran up charges by donating money to charitable organizations.

Reading the comments generated on a number of websites and blogs, it is obvious that there are large numbers of people who are morally degenerate enough to think that Robin Hood tactics are a means of doing good. That should have been obvious from the support that the Occupy Movement has had, even from people who otherwise have a reputation as good citizens. The fact that even political leaders seem to feel that evil deeds will solve the Nation's problems ought to serve as warning that we are headed for catastrophic anarchy, and the eventual loss of cherished freedoms.

I have a number of friends, many now retired, who have worked in the IT field since the 1960's (some even longer) who contemptuously call such troublemakers "script kiddies". They spent a good part of their careers working to foil people who either as a game, or as part of organized espionage, attempted to circumvent security features and access data which was not intended for public exposure. They are well aware that most security breeches are caused by laxity on the part of an IT department which has not considered itself a target for one reason or another. They are also quite confident that as such exploits grow in number, there will be retaliatory measures taken.

"Anonymous", "Occupy Whatever", and other such self-absorbed dreamers need to understand that their mischief to this point has been directed at groups and organizations which have not attempted retaliation. The clients of Stratfor, however, are a mixed bag of corporate and governmental entities, and includes private contractors for security concerns. One of the reasons for attacking that site was that Stratfor was somehow considered "evil", merely on the basis of who they accepted as clientele. One of the reasons for shooting BBs at the hornets' nest was that they could possibly sting people.

In all the wide world there probably are well trained and genuinely evil people who patronize think tanks like Stratfor. That should give the terrorists pause. Just as they are able to use their technological skill to break in, steal information, and use it to create havoc, their victims are also technologically capable, and will eventually be able to track down their tormentors.

At that point, the Internet terrorists had better hope that their victims are much less evil than they originally believed. Back in the bad old days, if you attacked a robber baron and stole his money or embarrassed him, he might not only come after you to kill you, but he might also strike at those near and dear to you. It is said that "Anonymous" tried to shake down a Mexican drug gang, and was warned that the consequences would be dire. They should not sleep too comfortably in the misapprehension that their victims on Wall Street and in other high places around the world are less serious about revenge than the drug lords who have no compunction about hanging their tormentors on wires from bridges, or removing body parts to send a message. Hornets do not like to have their nests disturbed.

Issue 2

I was asked to put together a brief explaining the reason for Issue 2. Issue 2 is a referendum on Ohio Senate Bill 5. SB 5 changed the Ohio Revised Code with regard to what was and was not permitted in bargaining between public employers (AKA “taxpayers”) and public employees. A “YES” vote is a vote to keep the changes. A “NO” vote is a vote to reject the changes.

SB 5 has been opposed by the unions. There are a number of important reasons for their opposition. New section 4113.80 prohibits discrimination in laying off employees. Section 4117.80 was changed to remove from collective bargaining certain items. New section 4117.081, which applies only to public schools, prohibits public schools from bargaining with unions over certain workplace rules, fixes at 85% the maximum amount the public might be required to pay for public school employee health care insurance premiums, and specifically exempts personal safety equipment from the prohibition. Section 4117.09 was changed to prohibit requiring non-union public employees to pay union dues, or to require union membership. Section 4117.26 was added to define public employee compensation as anything of value given to the employee in exchange for service.

While most private employees would see these changes as making public employee pay and benefits conform to the “real world”, the requirements that teachers agree individually in writing to pay union dues is rightly viewed as a major attack on union power. The unions have resorted to lies about what the bill contains, and many of the people who say they are opposed have simply been mislead or are otherwise ill-informed. Few of the opponents of Issue 2 will flatly admit that it challenges the feathering of their own nests.

The Official Argument and Explanation for Issue 2 (one page) can be found on the Ohio Secretary of State’s website. A synopsis of the critical changes follows; text in red has been added to (underlined) or deleted from (struck through) the existing ORC.



Sec. 4113.80. (A) As used in this section, "public employer" means the state or any agency or instrumentality of the state, and any municipal corporation, county, township, school district, or other political subdivision or any agency or instrumentality of a municipal corporation, county, township, school district, or other political subdivision.
    (B) "Age," "ancestry," "color," "disability," "military status," "national origin," "race," "religion," and "sex" have the same meanings and shall be construed in the same manner as in Chapter 4112. of the Revised Code.
    (C) When determining whether to lay off an employee as part of a reduction in force, a public employer shall not consider the race, color, religion, sex, military status, national origin, disability, age, or ancestry of the employee in violation of Chapter 4112. of the Revised Code or any applicable federal law.

Sec. 4117.08. (A) All matters pertaining to wages, hours, or and terms and other conditions of employment and the continuation, modification, or deletion of an existing provision of a collective bargaining agreement are subject to collective bargaining between the public employer and the exclusive representative, except as otherwise specified in this section and division (E) of section 4117.03 4117.081 of the Revised Code. Any existing provision of a collective bargaining agreement that was modified, renewed, or extended from a prior collective bargaining agreement that does not concern wages, hours, and terms and conditions shall not be a mandatory subject of collective bargaining and shall not be subject to any impasse procedure without the mutual agreement of both the public employer and exclusive representative. The inclusion of a provision in a previous collective bargaining agreement shall not be used as a basis for the provision being determined to concern wages, hours, and terms and conditions.
    (B) The following subjects are not appropriate subjects for collective bargaining:
    (1) The conduct and grading of civil service examinations, the rating of candidates, the establishment of eligible lists from the examinations, and the original appointments from the eligible lists are not appropriate subjects for collective bargaining;
    (2) Health care benefits, except that, subject to division (E) of this section, the amount of the cost of those benefits for which a public employer and the public employees of the public employer pays is an appropriate subject of collective bargaining;
    (3) The payment of a contribution by a public employer to the public employees retirement system, the Ohio police and fire pension fund, the state teachers retirement system, the state highway patrol retirement system, or the school employees retirement system on behalf of an employee, contributor, or teacher, as applicable, that the employee, contributor, or teacher otherwise is required to pay;
    (4) The privatization of a public employer's services or contracting out of the public employer's work;
    (5) The number of employees required to be on duty or employed in any department, division, or facility of a public employer.
    (C) Unless a public employer specifically agrees otherwise in an express written provision of a collective bargaining agreement, nothing in Chapter 4117. of the Revised Code impairs the right and responsibility of each public employer to:
    (1) Determine matters of inherent managerial policy which include, but are not limited to areas of discretion or policy such as the functions and programs of the public employer, standards of services, its overall budget, utilization of technology, and organizational structure;
    (2) Direct, supervise, evaluate, or hire employees;
    (3) Maintain and improve the efficiency and effectiveness of governmental operations;
    (4) Determine the overall methods, process, means, or personnel by which governmental operations are to be conducted;
    (5) Suspend, discipline, demote, or discharge for just cause, or lay off, transfer, assign, schedule, promote, or retain employees;
    (6) Determine the adequacy of the work force;
    (7) Determine the overall mission of the employer as a unit of government;
    (8) Effectively manage the work force;
    (9) Take actions to carry out the mission of the public employer as a governmental unit Hire, discharge, transfer, suspend, or discipline employees;
    (2) Determine the number of persons required to be employed or laid off;
    (3) Determine the qualifications of employees;
    (4) Determine the starting and quitting time and the number of hours to be worked by its employees;
    (5) Make any and all reasonable rules and regulations;
    (6) Determine the work assignments of its employees;
    (7) Determine the basis for selection, retention, and promotion of employees;
    (8) Determine the type of equipment used and the sequence of work processes, except as provided in division (F) of this section;
    (9) Determine the making of technological alterations by revising either process or equipment or both, except as provided in division (F) of this section;
    (10) Determine work standards and the quality and quantity of work to be produced;
    (11) Select and locate buildings and other facilities;
    (12) Establish, expand, transfer, or consolidate work processes and facilities;
    (13) Transfer or subcontract work;
    (14) Consolidate, merge, or otherwise transfer any or all of its facilities, property processes, or work with or to any other municipal corporation or entity or effect or change in any respect the legal status, management, or responsibility of such property, facilities, processes, or work;
    (15) Terminate or eliminate all or any part of its work or facilities.
    The employer is not required to bargain on subjects reserved to the management and direction of the governmental unit except as affect wages, hours, terms and conditions of employment, and the continuation, modification, or deletion of an existing provision of a collective bargaining agreement. A public employee or exclusive representative may raise a legitimate complaint or file a grievance based only on the violation of the express written provisions of a collective bargaining agreement.
    (D) During negotiations between a public employer and an exclusive representative, the parties shall consider, for purposes of determining the ability of the public employer to pay for any terms agreed to during collective bargaining, only the financial status of the public employer at the time period surrounding the negotiations. When determining whether the employer can pay for those terms, the parties shall consider the employer's inability to pay. The parties shall not consider either of the following when determining the ability of the public employer to pay for those terms:
    (1) Any potential future increase in the income of the public employer that would only be possible by the employer raising revenue, including, but not limited to, passing a levy or a bond issue;
    (2) The employer's ability to sell assets.
    (E) The provision of health care benefits for which the employer is required to pay more than eighty-five per cent of the cost is not an appropriate subject for collective bargaining. No public employer shall agree to a provision that requires the public employer to pay more than eighty-five per cent of the cost paid for health care benefits.
    (F) Notwithstanding division (C) of this section, equipment issues directly related to personal safety are subject to collective bargaining.

Sec. 4117.081. (A) This section applies only to school districts, educational service centers, certain conversion community schools established under Chapter 3314. of the Revised Code, and STEM schools established under Chapter 3326. of the Revised Code.
    (B) No public employer to which this section applies shall enter into a collective bargaining agreement on or after the effective date of this section that does any of the following:
    (1) Requires the public employer to employ a minimum number of total personnel or any category of personnel;
    (2) Restricts the authority of the public employer or a district or service center superintendent to assign personnel to school buildings or restricts the authority of a building principal to designate the responsibilities and workloads of personnel assigned to the building;
    (3) Establishes a maximum number of students who may be assigned to a classroom or teacher;
    (4) Prohibits the public employer from making reductions in teachers or nonteaching employees for any applicable reason specified in division (B) of section 124.321 or section 3319.17 or 3319.172 of the Revised Code or in a policy adopted under section 3319.171 of the Revised Code;
    (5) Restricts the authority of the public employer, when making personnel reductions, to determine the order of layoffs;
    (6) Restricts the authority of the public employer to acquire noneducational services from another public or private entity through competitive bidding;
    (7) Restricts the authority of the public employer to acquire any products, programs, or services pursuant to section 3313.841, 3313.842, 3313.843, or 3313.845 of the Revised Code;
    (8) Otherwise relinquishes, impairs, or restricts the managerial rights and responsibilities of the public employer described in division (C) of section 4117.08 of the Revised Code.
    (C)(1) Except as otherwise provided in division (C)(2) of this section, each collective bargaining agreement entered into on or after the effective date of this section between a public employer to which this section applies and its employees shall comply with all applicable state or local laws or ordinances regarding wages, hours, and terms and conditions of employment of public employees.
    (2) A collective bargaining agreement entered into on or after the effective date of this section may include a provision that conflicts with an applicable law or ordinance, if the provision establishes benefits that are less than the benefits conferred by the law or ordinance and division (A) of section 4117.10 of the Revised Code does not require that the law or ordinance prevail over the conflicting provision. Any provision of the agreement that conflicts with an applicable law or ordinance and does not meet these requirements shall be void.
    (D) Notwithstanding division (A)(5) of section 4117.11 of the Revised Code, a public employer to which this section applies is not required to, and may refuse to, collectively bargain on the continuation, modification, or termination of a provision of an existing collective bargaining agreement.

Sec. 4117.09. (A) The parties to any collective bargaining agreement shall reduce the agreement to writing and both execute it.
    (B) The agreement shall contain a provision that:
    (1) Provides for a grievance procedure which may culminate with final and binding arbitration of unresolved grievances, and that are based on the disputed interpretations of the express written provisions of the agreements, and which is valid and enforceable under its terms when entered into in accordance with this chapter. No publication thereof is required to make it effective. A party to the agreement may bring suits for violation of agreements or the enforcement of an award by an arbitrator in the court of common pleas of any county wherein a party resides or transacts business.
    (2) Authorizes the public employer to deduct the periodic dues, initiation fees, and assessments of members of the exclusive representative upon presentation of a written deduction authorization by the employee so long as the employee organization has filed and maintained its financial report outlining the organization's expenditures.
    (C) The No agreement may contain a provision that requires as a condition of employment, on or after a mutually agreed upon probationary period or sixty days following the beginning of employment, whichever is less, or the effective date of a collective bargaining agreement, whichever is later, that the employees in the unit who are not members of the employee organization pay to the employee organization a fair share fee. The arrangement does not require any employee to become a member of the employee organization, nor shall fair share fees exceed dues paid by members of the employee organization who are in the same bargaining unit. Any public employee organization representing public employees pursuant to this chapter shall prescribe an internal procedure to determine a rebate, if any, for nonmembers which conforms to federal law, provided a nonmember makes a timely demand on the employee organization. Absent arbitrary and capricious action, such determination is conclusive on the parties except that a challenge to the determination may be filed with the state employment relations board within thirty days of the determination date specifying the arbitrary or capricious nature of the determination and the board shall review the rebate determination and decide whether it was arbitrary or capricious. The deduction of a fair share fee by the public employer from the payroll check of the employee and its payment to the employee organization is automatic and does not require the written authorization of the employee. The internal rebate procedure shall provide for a rebate of expenditures in support of partisan politics or ideological causes not germaine to the work of employee organizations in the realm of collective bargaining. Any public employee who is a member of and adheres to established and traditional tenets or teachings of a bona fide religion or religious body which has historically held conscientious objections to joining or financially supporting an employee organization and which is exempt from taxation under the provisions of the Internal Revenue Code shall not be required to join or financially support any employee organization as a condition of employment. Upon submission of proper proof of religious conviction to the board, the board shall declare the employee exempt from becoming a member of or financially supporting an employee organization. The employee shall be required, in lieu of the fair share fee, to pay an amount of money equal to the fair share fee to a nonreligious charitable fund exempt from taxation under section 501(c)(3) of the Internal Revenue Code mutually agreed upon by the employee and the representative of the employee organization to which the employee would otherwise be required to pay the fair share fee. The employee shall furnish to the employee organization written receipts evidencing such payment, and failure to make the payment or furnish the receipts shall subject the employee to the same sanctions as would nonpayment of dues under the applicable collective bargaining agreement.
    No public employer shall agree to a provision requiring that a public employee become a member of an employee organization as a condition for securing or retaining employment. Any agreement that purports to require that employees join any exclusive representative is void and unenforceable.
    No public employer shall agree to a provision that provides for the payroll deduction for any contributions to a political action committee using any other method than the method prescribed in sections 3517.082, 3517.09, and 3599.031 of the Revised Code.
    (D) As used in this division, "teacher" means any employee of a school district certified to teach in the public schools of this state.
    The agreement may contain a provision that provides for a peer review plan under which teachers in a bargaining unit or representatives of an employee organization representing teachers may, for other teachers of the same bargaining unit or teachers whom the employee organization represents, participate in assisting, instructing, reviewing, evaluating, or appraising and make recommendations or participate in decisions with respect to the retention, discharge, renewal, or nonrenewal of, the teachers covered by a peer review plan.
    The participation of teachers or their employee organization representative in a peer review plan permitted under this division shall not be construed as an unfair labor practice under this chapter or as a violation of any other provision of law or rule adopted pursuant thereto.
    (E) No agreement shall contain an expiration date that is later than three years from the date of execution. The parties may extend any agreement, but the extensions do not affect the expiration date of the original agreement.
    (F) No public employer shall agree to a provision that requires the public employer, when a reduction in force is necessary, to use an employee's length of service as the only factor to determine whether to lay off the employee.


Sec. 4117.26. (A) As used in this section, "compensation" means wages, salary, and other earnings paid to a public employee by reason of employment. "Compensation" includes all of the following that are provided by a public employer to a public employee:
    (1) Allowances for food or drink;
    (2) Allowances or stipends for clothing;
    (3) Compensation in addition to base salary for labor performed or services rendered by the public employee, including any additional compensation paid for attending an event that occurs outside the public employee's normal work schedule;
    (4) Payments for length of service;
    (5) Allowances for dry cleaning services;
    (6) Insurance coverage, including health insurance, vision insurance, dental insurance, disability insurance, or life insurance;
    (7) Anything of value given to a public employee by a public employer for labor performed or services rendered by the public employee that is not generally offered to any of the public employer's employees that are not subject to a collective bargaining agreement, unless they are de minimis.