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Opinion Viewpoint

Little Goodies

I just love the fine print in the president’s tax-cut plan. I grant you, the overall effect is pretty spectacular too — a plan that has almost no stimulative effect but still opens a future of zillion-dollar deficits to drag down the economy. That’s the backasswards of what we need, but it’s not the fun part.

Look at these little goodies:

• Think because you have money in the stock market you might have a stake in eliminating the dividend tax, the centerpiece of the president’s tax cut — $300 billion over 10 years? You probably think you have money in the stock market because your 401(k) keeps going down — that would be 40 million Americans. But no! This tax break doesn’t apply to your dividends! The money in your 401(k) from both savings and dividends are tax-sheltered until you withdraw the money — then all of it gets taxed as ordinary income. You don’t get any tax break on your dividends — that only goes to the investor class.

According to Kevin Phillips, 1 percent of investors pocketed 42 percent of the stock-market gains between 1989 and 1997, while the top 10 percent of the population took 86 percent. These people need a tax cut! They haven’t been getting their share!

• According to the Urban-Brookings Tax Policy Center, the effect of eliminating dividend taxation is that the average benefit for those making less than $10,000 would be $6 and the average benefit for those making more than $1 million would be $45,098.

• Bush also wants to accelerate the income-tax cuts slated for 2006. Look at this folly: The top 5 percent of taxpayers would get 70 percent of the benefits on that one. The bottom 80 percent would get 6.5 percent of the benefits. Ditto with accelerating the 2004 tax cuts: 64.4 percent to the top 5 percent of taxpayers; 7.7 percent to the bottom 80 percent.

• One of those people who can’t handle numbers? Need something visual to work with? Find the Urban-Brookings charts published in the January 7th New York Times showing who gets how much of this tax cut. You can barely see the lines that measure the relief until you get above the 99th percentile.

The only good part of Bush’s tax-cut plan is the $400 increase in the tax credit per child. Naturally, that’s the one part of the plan right-wingers hate.

As we all wade into these numerical battles over exactly how much of this tax cut goes to the very rich, the more fundamental question is whether it’s a good idea, economically or in terms of social justice, to have the very rich get very much richer than they already are.

Contrary to the paranoid fantasists on The Wall Street Journal‘s editorial page, populists are not motivated by some burning resentment of the rich. We don’t spend our lives in an envious funk that someone else is better off than we are. Less than 0.1 percent of the U.S. population gave 83 percent of all itemized campaign contributions for the 2002 elections, according to the Center for Responsive Politics.

How dumb do you have to be not to be able to connect the dots here? Law, policy, and regulation are consistently shaped to favor the rich over the rest of us, and that, dammit, is not fair, it is not right, it is not the country we want and for which we are asked to sacrifice.

Molly Ivins writes for Creators Syndicate and the Fort Worth Star-Telegram.

Categories
Politics Politics Beat Blog

BAD PROGNOSIS FOR TENNCARE

NASHVILLE — TennCare will end the state’s budget year next June with at least a $258 million shortfall despite the largest tax increase in Tennessee history, the program’s director told legislators Wednesday.

The shortfall is expected largely because reforms failed to generate the expected savings, and payments to managed care organizations (MCOs) and for drugs are higher than expected, TennCare Director Manny Martins told House members during the second day of their organizational session.

“We’re looking at a $258 million problem,” Martins said.Worst case: an additional $300 million shortage. Martins’ appearance was the first of three days worth of presentations to House members by officials dealing with the state’s three biggest — and most immediate — financial headaches: TennCare, teacher pay equity and setting up a state lottery.

Sponsors of the lottery legislation made their case in the Senate on Wednesday and will discuss the matter in the House on Thursday.

State Attorney General Paul G. Summers will make a presentation on teacher pay equity in the Senate on Thursday and in the House on Friday.

In his presentation to House members, Martins noted that medical services account for about half of the $6 billion TennCare program. “In the first six months of this year, we’re going to spend $593 million more than we budgeted in dental, $43 million more in pharmacy and $4 million more in supplemental provider payments,” Martins said.

Aggravating the problem is a severe difference between real and anticipated savings expected from TennCare reforms, such as the reverification of who is eligible and who is not.

TennCare spends an average of $158 per enrollee every month. But the enrollees booted from the program were largely a healthy group, leaving the state to pay an average of $200 a month for most of its enrollees, who are a sicker group, Martins said.

“It was quite an eye-opener,” House Speaker Jimmy Naifeh said later during his weekly news conference.”We have a real problem with TennCare, (but) if something is doing good, it

ought to survive.”

Naifeh said he wants to wait for a TennCare solution from incoming Gov. Phil Bredesen, who made millions of dollars in health care, mainly in managing health maintenance organizations. “I hope to manage our way out of this mess,” Naifeh said. “I think it was an innovative program. It’s something that’s needed.”

House Speaker Pro Tem Lois DeBerry, D-Memphis, said TennCare has been underfunded, an argument made by health care providers who say they’re underpaid, since its inception in 1994.

“The bottom line is we need a miracle,” she said.

Categories
Politics Politics Beat Blog

POLITICS: Frustrated Suitors

Untitled Document

WASHINGTON — Ostensibly, last week was a quiet one for Harold Ford Jr., the 9th District Memphis congressman whose meteoric rise in the national consciousness has been counterpointed at home by long-term questions about his statewide electability. Congress reconvened last week but will not start its real business until late in the month, after President Bush’s State-of-the-Union address.

But, as previously reported here, there is new movement on the Ford front. This time it’s not among his fellow Democrats, whom the 31-year-old congressman courted last fall in an unsuccessful race for House minority leader against the better-known Nancy Pelosi of California. This time it comes from Republicans, who — well off the media radar screen — have been carrying on a running courtship of Ford for some time now.

“I’ve had a number of approaches from them,” Ford said last week of the overtures from the GOP, both national and Tennessee-based, and he confirmed that, in response to their invitation, he would be sitting down this week with area businessmen who presumably have interests at large to discuss but who have made no secret of their belief that Ford should consider changing parties prior to any statewide run.

Considered a possible Democratic candidate for the U.S. Senate in 2000 against Senator Bill Frist, Ford gave public consideration to running even long after his political base had been somewhat undermined by the defeat in the 1999 Memphis mayoral race of Uncle Joe Ford, then a city councilman, by incumbent Willie Herenton. In March of last year, the young congressman had also wanted to run for the seat which Fred Thompson, then the state’s senior senator, announced that he would be vacating but was forced by party elders to defer to Bob Clement, his congressional counterpart from Nashville.

Clement’s efforts proved futile against a political comeback by the self-assured former GOP governor Lamar Alexander, and many of his partymates thought the more dynamic Ford would have had better chances. Ford is known to be eyeing a race for the Senate in 2006 if Frist, the newly elected Senate majority leader, follows through on his long-standing pledge to serve two terms only. But there is a skeptical contingent among Tennessee Democrats who continue to doubt that Ford, as an African-American, could prevail in a statewide race, especially considering that Tennessee Republicans have clearly established parity — or better — vis-ˆ-vis Democrats.

The efforts by Republicans to entice Ford to their standard offer, at least on the surface, a corrective of sorts to those doubts. The congressman’s partisans, both in Tennessee and in Washington, have long insisted that his appeal transcends not only racial lines but the usual partisan divides as well. Though he occasionally makes an effort to distance himself from labels like that of “black centrist” (which the New York Times Magazine conferred on him in a notable profile a couple of years back), Ford obviously relishes the crossover image which such descriptions confer and frequently makes the point that his congressional friendships transcend party lines.

And Ford’s ambitious bid for party leadership last year — which crested at a disappointing 29 votes — was widely interpreted as being aimed at Democratic moderates dissatisfied with the national party’s left-of-center image.

All the same, it is beyond implausible that Harold Ford Jr. would ever consider any change of partisan address. Even if he were willing to do so, what his GOP suitors overlook is that not even he could hold on to the black Democratic voter base of Memphis — source of the Ford family’s political power — if he should shift his party allegiance.

Aside from that root fact, there is no reason to doubt Ford’s fidelity to the Democratic Party. In a lengthy letter-to-the-editor in the current New Republic, Ford’s chief of staff, Memphian Mark Schuermann, takes the magazine to task for its critical view of the congressman at the time of his recent leadership bid.

Citing fundraising activity and campaign appearances on behalf of both Tennessee and national Democratic campaigns this past year, Schuermann portrays his boss as a vital cog in issues like campaign finance reform as well as in his party’s rebuilding efforts, generally. “Ford’s hurry to change things came after House Democrats were unsuccessful for the fourth straight election. However, he is committed to working with the current leadership and believes his unsuccessful bid will help push the party to work even harder to reclaim the majority in two years,” concludes Schuermann.

In any case, the congressman himself declared categorically last week, “I’m a Democrat.” But, he said after a pause, “I sure don’t mind getting some of those Republican votes!”

  • If Ford’s pace last week was somewhat restrained, it was otherwise for some of his fellow Tennesseans, notably several new congressmen — the 7th District’s Marsha Blackburn, the 4th District’s Lincoln Davis, and the 5th District’s Jim Cooper — who underwent the bustle of orientation and swearing-in rituals. (Blackburn is a Republican; Davis and Cooper, who represented the 4th District himself before losing a 1994 Senate race to Thompson, are Democrats.)

    And it was not exactly slack time, either, for Frist, a likely contender for the presidency in 2008 whose rapid rise to prominence in the GOP was crowned by his election as Senate Majority Leader last year to succeed the tarnished Trent Lott of Mississippi.

    The press of Senate business kept Frist from attending when Alexander hosted a reception for Thompson and former Senator Howard Baker in the Russell Senate Office Building caucus room where in 1973 Baker, then head of the Republicans on the Senate Watergate committee, and Thompson, his legal counsel, rose to national prominence.

    Ironically, Lott showed up — a fact which led some to speculate on what might have been the interchange with Frist, who not only succeeded him but had been one of the Mississippian’s first intraparty critics when Lott uttered his fateful and impolitic praise last month of retiring South Carolina Senator Strom Thurmond’s 1948 Dixiecrat presidential campaign.

    “I’ve seen better days,” Lott acknowledged to one well-wisher. In his own remarks to the assemblage, Alexander made a point of acknowledging Lott, whom he termed an “old friend” that he’d frequently worked with, while serving as Tennessee governor, on regional issues.

    Considering the circumstances of the GOP’s switch from Lott to Frist, a presumed moderate on racial matters, President Bush’s subsequent renomination of a Mississippi jurist, U.S. District Judge Charles Pickering, to serve on a federal appeals court left a number of political observers buffaloed.

    The nomination of Pickering, a Lott protégé, was blocked in the Senate last year by Democrats who regarded several of his prior judicial actions as racially tinged, and Democratic leader Tom Daschle of South Dakota, who was Majority Leader in the last session, left no doubt that Pickering would face renewed opposition this year.

    That more or less left Frist, as Bush’s front man in the Senate, holding the bag, and it was baggage that he clearly seemed less than delighted with, though in a myriad of appearances on TV talk shows, the new Majority Leader made an effort to toe the line on Pickering’s behalf — at least to the tune of giving the nominee a “fair hearing.”

    In a telephone chat with Tennessee reporters on Friday, Frist made an effort to sound upbeat about the duty of handling the Pickering case. “I look forward to making this an opportunity — I don’t want to call it an unprecedented opportunity — to address issues surrounding race relations,” he said, adding, “I’m pretty much where I have been.ÉI believe he (Pickering) is imminently qualified for the job.”

    But, having said that, he promptly gave himself some distance: “I will keep saying this, that my goal is to make sure there is a system in place to ensure a fair an equitable process. There have been many people in the U.S. Senate who have expressed feelings that Judge Pickering’s hearing was unfair.”

  • Categories
    Politics Politics Beat Blog

    I am continually amazed at the cluelessness of the Republican Party. This is evidenced by Jackson Baker’s recent column noting that they were courting our congressman, Harold Ford, in the hopes that he would convert and (hopefully) bring his support with him.

    Wrong, on both counts. One, for his voting record, which I wish more matched his father’s, he is still to the left of ANYBODY in the Republican Party, even Arlen Specter or Susan Collins.

    Two, and most importantly, until the Republican Party does a 180 on race and affirmative action, most African-Americans will treat the GOP like the plague. I suspect much of the GOP base will like that just fine.

    This might well explain the action of the Bush administration’s decision to oppose the University of Michigan’s affirmative action program, even after the the Trent Lott fiasco.

    Simply put, such actions reaffirm their reputation as the party of Jefferson Davis. On its face, the GOP seems to be telling minorities that “we want you in our party, so long as you support policies that work against your best interests.”

    As usual, and despite what he tells the American public at large, Bush has decided that his base is more important than any other constituency. We know what that is: conservative to reactionary middle-aged white males. And, of course, those can be found in large quantities right here in the South.

    What the GOP either has not realized, or, more likely doesn’t care, is that affirmative action, while not perfect, is the best way to redress prior grievances in matters of race. Translated, why are white males upset that so many “unqualified” minorities are hired

    or admitted, given that lots of “unqualified” people were hired or admitted for years for no other reason than that they were white?

    Since 1968 and Nixon’s Southern Strategy, this has been the stock-in-trade of the Republican Party. This is why the “Rockefeller” wing of the party was all but run out of the GOP on a rail.

    It’s just too bad that the so-called “liberal” media let them get away with murder on this, and other issues.

    BACKTALK TO BACKTALK:

    To Steve Steffens:

    How is affirmative action in the best interest of minorities?

    Is it possible to believe minorities should not receive anything based

    solely on their race and

    not be called a racist?

    If a minority thinks I should not receive a job solely on my race (white) is

    the

    minority a racist?

    RonP@LewisSupply.com

    AND STEFFENS REPLIES:

    Well, that didn’t take long….

    It depends a lot on how you define racism.

    Personally, I don’t define racism as having an innate dislike of other races, I believe that racism is an inate preference of one’s own race. The only way you overcome that is by actively trying to overcome that.

    Affirmative action helps remedy that situation,

    especially in academic situations, by bringing people of different races and cultures together. It forces you to learn about other people; the best year of my life was my 9th grade year at Geeter Junior High School, where I was a minority for the first time, and

    it gives you a new perspective.

    If the playing field were level, then we would not need affirmative action. However, it’s not, and I don’t know how long it will take, but, we have to go there.

    Remember, the only people who don’t truly understand the advantage of being white in this society ARE

    white.

    Categories
    News News Feature

    HOW IT LOOKS

    Categories
    News The Fly-By

    ORATOR FRIST

    Meet the Press Tim Russert asked Tennessee Senator cum House majority leader Bill Frist, Will the Republican Party s position on race change? Frist replied, I think that we have a tremendous opportunity. A tremendous opportunity to take what has been very difficult both discussions in the last few weeks for, yes, the Republican Party, but I would even extend it much beyond that to Washington, D.C., and around the country, down to individual households. Frist concluded by saying, That opportunity is one that I m going to try to seize. I know my caucus is going to try to seize. We just had a meeting the other day; people standing up, speaking passionately about being able to take advantage of this dialogue that we ve, to be honest with you, generally, not just Republicans, have ignored over the last several years. The Fly team s staff of linguistic experts have analyzed the senator s rather cryptic comments and determined that Frist, still dizzy with power, intended to say, No comment.

    Categories
    We Recommend We Recommend

    thursday, 16

    Why, I m madder than Diana Ross trying to stand on one leg and touch her nose with her finger while counting backwards in a Blockbuster parking lot. Well, not really. I just wanted to say that because it s the kind of thing Ed Anger always gets to write in his column in the Weekly World News. As a matter of fact, I rarely get mad about anything. Disgusted? Yes. Confused. Every waking moment of the day and night. Take North Korea. They ve been sitting there for 30 years with hardly any media attention at all, and now all of a sudden we want to go to war with them. Or some people do. Because they have weapons of mass destruction. Is anyone else out there as sick of hearing that phrase as I am? And here s a very simple question no one seems to be able to answer: The United States has a HUGE arsenal of weapons of mass destruction, so why should we be the only ones to have them? I m really sincere about this one. Is it a good-guy, bad-guy kind of thing? Has anyone given consideration to the fact that the United States is the only country that has ever dropped a nuclear bomb (or, nucular, as our proud leader says) on another country? I really don t get it, but then, there are many things I don t get. Like Siamese twins. How does that happen? How freaky is that? I knew a pair of Siamese twins once, but they had to move to England so the other one could drive for a change. I also knew a nun once who had a terrible sleepwalking problem. She was such a roamin Catholic! Okay, okay, okay. Sometimes I just can t help myself. Just like a bartender friend of mine couldn t the other day. A big cheeseburger walked in and ordered some fries, and the bartender had to say, Sorry, but we don t serve food in here! You know, I love being on the same intellectual level as my eight-year-old nephew. The one who is writing the book about the similarities between elementary school and prison. It s coming along quite nicely. He s working on the chapter now about digging out. It seems there s some sort of brick wall around the playground at his school in St. Louis, and he has managed to find a way to chip away at the cement between the bricks. And he now refuses to speak without mocking a Puerto Rican accent. Not that Puerto Ricans have a tendency to be in prison, but it s just something the little tike likes to do. He also loves to fake fainting. I can be sitting there talking to him and he just falls out in the floor and lays there motionless. His favorite smells are cigarette smoke, gasoline, and pizza. His picture, by the way, can be seen in the upcoming February issue of RSVP magazine. Can you imagine what they would be like if I had children? Good heavens. The world wouldn t be nearly as scared of weapons of mass destruction with my kids out there on the loose. Look what I ve done to my cat. Our latest game is DUI Kitty. I got this little flashlight with a blue bulb in it and I just follow her around flashing it like police-car lights and telling her to pull over and get out of the car. Then we do a little field sobriety test and smell her breath and tell her she s going to have to go to jail. It occupies my time, of which I am now out (I can hear the sighs of relief) and must get on the real business at hand here what s going on around town this week. Here s a peak.

    Tonight, classical guitarist and all-round lovely person Lily Ashfar is at the Buckman Performing and Fine Arts Center. It s Third Thursdays: Art After Dark at The Dixon at The Dixon Gallery and Gardens, a 12-month program during which visitors can view art, network, and familiarize themselves with three countries; tonight s event includes a gallery talk, Italian food and wine, and the Italian film Roma, citta aperta. Ruby Wilson is at B.B. King s tonight. And Ray s Music Exchange and Yamagata are at Young Avenue Deli.

    Categories
    Politics Politics Beat Blog

    HOW IT LOOKS

    Categories
    News News Feature

    TRANSLATION: MEMPHIS: Down and (Not So) Dirty

    Since my column last week focused on Memphis from up high–or from overhead–I think it would be fair this week to consider our city from down low.

    Way down low.

    I want to talk about the Memphis “dive,” the bars that your Momma would warn you against given the chance, but that offer their own little gems in terms of, well, experience.

    It seems that if you throw a rock in our city, you’re bound to hit either a church or a bar.

    These two cultural institutions can quite literally be found everywhere, seemingly in almost equal numbers, and there’s even some cross-pollination, what with the gospel brunches offered at some of the more soulful pubs.

    But I happen to be a night person, so…

    I suppose that every drinker has their own definition of exactly what constitutes a dive, and depending upon your level of grit this can include places higher or lower on the scale.

    For instance, one who relishes the art of the fine martini might consider a place like the Young Ave. Deli to be a dive, while one who regularly consumes 24 OZ. Cans of Schlitz would have a different take entirely.

    As for me, I go by feel alone.

    A good dive, in my opinion, should be in walking distance (ideally,) should have cheap, domestic beer, and should peddle said beer at low prices. Additional factors that enhance a locale’s “divability” include a lack of natural light (as in sunlight, not the beer,) a regular clientele of neighborhood folk that spend a minimal amount of time preparing for their visit, pinball or some other form of arcade entertainment, and a decent jukebox or stereo system.

    According to the website shtick.org a dive should also meet the following conditions: no velvet rope, no line for entrance, no high cuisine that isn’t fried, and nobody complaining that the bathroom stalls are without doors, mirrors, or any other convenience of the like.

    I think our friends at Webster’s Dictionary have one up on all of us though, with the portion of their definition stating “to thrust the body under, or deeply into, water or other fluid.” Aha–beer.

    It would take about a million years to visit all of the dives in our area, but in accordance to the aforementioned requirements, I suppose my dive would be the World Famous Poplar Lounge. Oh yeah!

    When I first moved into the vicinity of the Poplar Lounge, I’ll admit I was a bit scared of it. One deciding factor swayed me, thoughÑthey actually sell Rolling Rock beer at non-import prices.

    Now some of you may be saying “who cares,” at this point. It’s light, watery soda beer, right? But here’s the thing, a thing that countless barkeeps in Memphis have failed to answer with any level of logicÑPennsylvania is just not a foreign country, not even in the lands held by the Amish.

    I grew up in its neighboring state, I know.

    My only assumption is that the beauty of the green bottle temporarily overwhelms the managers of our area drinking establishments, making them think that nothing so beautiful could possibly have been produced here in the states.

    To be sure, I’ve tired many an overworked bartender demanding a logical explanation for this anomaly.

    But not at the Poplar Lounge. A mere $2.25 last time I checked.

    The inherent logic of their pricing made for instant love. In fact, they looked at me a bit strangely when I burst into song and danced back to my table, clutching that green bottle close to my heart.

    The Poplar Lounge is not by any means a pretty place, unless you factor in their courtyard, pretty because it’s outside. That doesn’t count though.

    There is also a contingent of regulars who may seem intimidating at first, what with their familiarity with one another. After a few drinks, though, that all disappears.

    Now my dive might not be your dive, as it were, and so be it. But every once in a while, it’s refreshing to find a watering hole lacking in pretense, a place where you can throw a few back and let off some steam without having to worry about whether your hair is in place.

    Ironically, it’s rather refreshing.

    Categories
    Opinion

    CITY BEAT

    A CAUTIONARY TALE

    Even wealthy investors fall prey to schemes with bogus “returns.”

    An Arkansas banker who died mysteriously in October is accused of defrauding a group of wealthy Memphians of several million dollars since 2000.

    Mace David Howell Jr. of Little Rock was found dead in October in a room at the Peninsula Hotel in Beverly Hills, California. The week before his death, the Arkansas Securities Department had issued a cease-and-desist order against Howell for selling unregistered securities and for not being registered as a broker-dealer.

    Last week, a group of investors filed a complaint in Marion, Arkansas, in Crittenden County Circuit Court against Howell’s estate and three trading firms: Merrill Lynch, Goldman Sachs, and Refco.

    The Memphis and Shelby County investors include Alabama football booster Logan Young, Shelby County Commissioner Bruce Thompson, former car dealer Tommy Keesee, cotton man Frank Barton Jr., Walter Edge, James H. Barton, Erskin and Jane Hubbard, Rex Jones, David Pearson, Sherry Pearson, Gary Prosterman, Harry L. Smith, and Herbert Thomas. According to documents filed in probate court in Little Rock, their investments ranged from $50,000 to $5 million apiece. Seven more claims totaling $1.8 million were filed this week, and more are expected.

    Other investors not named in the law suit reportedly included Arkansas native and Dallas Cowboys team owner Jerry Jones, according to the Arkansas Democrat-Gazette.

    Howell, who was 54 when he died, claimed he had devised a system of investing in bond and commodity futures that yielded returns of 90 percent, the Crittenden County complaint says. Howell gave investors promissory notes with annual interest payments of 10 to 40 percent and also told them they could get all their money back any time they want ed it on 30 days’ notice. Such returns would beat the single-digit returns of legitimate bond funds over the last two years and the losses of the stock market since 2000. The best commodity traders have got ten 20 percent returns over time.

    “If you are going to claim you are infinitely smarter than the average manager out there, then you are taking speculative risks,” said Charles McVean of McVean Trading and Investments. “You can marginally beat the averages over time by being smarter.”

    With the notes now worthless, investors have their sights on Howell’s family trust, insurance proceeds, and the trading firms. Court filings say Howell was actually broke and unable to meet demands from the trading firms to put up cash when the leveraged bets he made on the futures markets — essentially a gamble on the direction of interest rates or commodity prices — began going against him. (Hillary Clinton’s successful foray into commodity futures trading in Arkansas was a Whitewater subchapter.) The heaviest losses were sustained by Frank Barton, who invested $5 million, and Young, who put up $4.74 million individually and through various trusts, according to probate court filings.

    Howell traded on his Arkansas and Memphis connections with the country club set as well as his background as a banker. His sister, Linda Bailey, named a defendant in the complaint as trustee of the family trust, is head of the civic group Goals for Memphis.

    Howell told investors, according to the complaint, that he could not “pull the trigger” on their investment but would “borrow” their funds and pay them a share of the returns providing they understood “that he, Howell, was earning far more in investment profits than he was paying them.”

    The lead plaintiff, William B. Benton of Horseshoe, Arkansas, could not be reached for comment. The attorney who filed the lawsuit, Kent Rubens of West Memphis, declined comment. Other investors declined to comment or referred questions to Rubens. Linda Bailey could not be reached for comment.

    Investors were still giving Howell millions of dollars as recently as last August. Shortly after that, Howell disappeared. Lawsuits indicate that Howell wrote checks to some of his investors in early October, but the checks bounced. The Arkansas Securities Department announced its investigation on October 15th. The next day, Bank of America sued Howell in Pulaski County Circuit Court over approximately $2 million in bad checks.

    Howell’s body was found by paramedics in the hotel room in Beverly Hills on October 23rd. David Campbell, spokesman for the Los Angeles County Coroner’s Office, said the cause of death still has not been officially determined, pending receipt of medical records and toxicological tests. Campbell said it was reported to the coroner’s office that Howell had a history of alcohol and prescription drug use and had been treated at the Betty Ford Clinic.

    Howell was the former president or part-owner of several banks in Arkansas, according to Arkansas Business, a weekly newspaper in Little Rock. Some of his biggest Arkansas investors were bankers and fellow members of Pleasant Valley Country Club in Little Rock.

    Flyer sources say there were Memphis investors not named in the Crittenden County lawsuit. Word of Howell’s “sys tem” apparently got around, with big investors getting notes with the highest interest rates of 25 to 50 percent, while the small fry settled for 10 percent. The law suit says Howell kept the money coming by falsely overstating his net worth, assuring investors he had millions of his own funds invested, and paying out “profits” that were in fact funds that belonged to other investors.

    “He had a track record of paying 32 percent a year,” said a source familiar with the case. “No one had any reason to believe it wasn’t working.”