Posts tagged with 'the colorado independent'

Weekly Mulch: The EPA Can Regulate Carbon, For Now

Posted Apr 8, 2011 @ 11:11 am by
Filed under: Sustain     Bookmark and Share

by Sarah Laskow, Media Consortium blogger

Solar Panels

This week, the House voted to shut down the carbon regulation program at the Environmental Protection Agency, but the Senate rejected four different measures that would have stopped or delayed EPA action. The EPA, as mandated by the Supreme Court, has been moving forward with regulations that would require carbon polluters to apply for EPA permits and to use the best available method to start limiting carbon emissions.

The Office of Management and Budget has promised that if Congress does vote to end the regulation program, “senior advisors would recommend that [the president] veto the bill,” as I report at The American Prospect. But as David Roberts points out at Grist, that does not mean President Obama would follow that course. Roberts writes:

I don’t see a promise there. I see wiggle room where his advisers can “recommend” a veto and he can ignore their recommendations. And of course this leaves aside whether Obama would veto a spending or appropriations bill with an EPA-blocking rider.

Making a better choice

The legislators who are supporting the anti-EPA bill often argue that the power to deal with this issue should rest with them, not the executive branch. But they also argue against the EPA’s regulations on the grounds that they’ll cost American companies money, leading to higher costs for consumers and fewer jobs.

It’s true: Dealing with carbon is expensive. Right now, Americans simply aren’t paying for the damage being done to the atmosphere, and many of us don’t seem to care.

In Orion Magazine, Kathryn Miles writes about this problem in a review of Moral Ground: Ethical Action for a Planet in Peril, a new collection of essays on the problem of climate change:

As editors Kathleen Dean Moore and Michael P. Nelson argue in their introduction, neither scientific data nor externally imposed regulation will change hearts and minds — let alone our behavior. “What is missing,” they contend, “is the moral imperative, the conviction that assuring our own comfort at terrible cost to the future is not worthy of us as moral beings.” And so, rather than focus on atmospheric theory and tipping-point statistics, Moral Ground seeks to inspire action through a recognition of our species’ commitment to ethical behavior.


In some cases, making ethical environmental choices does mean paying more, at least temporarily, for clean energy, for products that create carbon pollution, for gas and oil. But there are also ways to fight climate change while saving money.

Composting, for example, costs nothing and produces something of value. In New York, the Lower East Side Ecology Center collects food scraps, composts them, and sells the finished product at the Union Square Farmer’s Market. As Kara Cusolito writes at Campus Progress, “Composted food scraps—whether from food prep or leftovers — turn back into the rich, fluffy soil that farmers and gardeners need to grow more food.” Farmers, for instance, can stop buying fertilizer if they start composting. Cusolito quotes one farmer who puts the choice in perspective: “Saying plants can’t grow well if they’re not conventionally fertilized is like saying people can’t be as happy if they’re not on drugs.”

The price of solar energy

Clean energy isn’t free of negative consequences, though, and clean energy advocates increasingly are butting heads with environmentalists who want to minimize the impact of new energy sources.

As dependence on natural gas, which counts as clean when compared with coal, grows in this country, worries about the threat of gas drilling to water sources is rising. At Earth Island Journal, Richard Ward of the UN Foundation, which supports natural gas as a clean energy source, and Jennifer Krill, executive director of Earthworks, lay out the cases for and against natural gas. Krill argues:

If the natural gas industry wants to be “clean,” it should embrace policies that mean no pollution of groundwater, drinking water, or surface waters; stringent controls on air pollution, including greenhouse gas emissions; protection for no-go zones, like drinking watersheds and sacred and wild lands; and respect for landowner rights, including the right to say no to drilling on their property.

But Krill notes the gas industry hasn’t show much interest in pursuing those compromises. And out west, some conservationists are objecting to the influx of solar panels on fragile desert lands. One group, Solar Done Right, for instance, “doesn’t disagree that much more solar energy is needed in order to decrease fossil fuel consumption and reduce heat-trapping greenhouse gas emissions, but they do disagree with developing solar facilities the way utilities build massive coal- or gas-fired power plants,” reports David O. Williams for The Colorado Independent. Instead, the group argues that solar energy can thrive in the “built environment,” on rooftops and on sites that are not environmentally vulnerable.

No matter what we do, there will be some costs to getting off of carbon, both for the economy and for the environment. But if the world does not decrease its carbon emissions, the costs will be much higher.

This post features links to the best independent, progressive reporting about the environment by members of The Media Consortium. It is free to reprint. Visit the Mulch for a complete list of articles on environmental issues, or follow us on Twitter. And for the best progressive reporting on critical economy, health care and immigration issues, check out The Audit, The Pulse, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.

Weekly Diaspora: Obama to Congress: It’s Time to Support Immigration Reform

Posted Jun 30, 2010 @ 11:14 am by
Filed under: Immigration     Bookmark and Share

by Erin Rosa, Media Consortium blogger

This morning, President Barack Obama condemned the “failure by those of us in Washington to fix a broken immigration system” and called on Congress to support reform this year.

“This administration will not just kick the can down the road,” Obama said. He also described comprehensive immigration reform as “held hostage to political posturing.” The UpTake, Mother Jones and The Colorado Independent provided live coverage of Obama’s statements.

The White House is no doubt concerned about the electoral consequences. Latino voters are waiting to see if Democrats address the issue. Obama also met with policy groups and members of the Congressional Hispanic Caucus at the White House on Monday and Tuesday to discuss moving forward on immigration reform.


The possibility for comprehensive immigration reform this year is still unlikely, thanks to inaction by federal lawmakers. Not only have elected officials been preoccupied with other pressing issues, such as health care reform and Supreme Court hearings, they also fear political backlash from voters if they support immigration reform during a recession.

On the bumpy road to immigration reform, Congress has clearly fallen asleep at the wheel. Lawmakers may still support reform focused on young immigrants and farm workers this year, even if it doesn’t involve creating a pathway to citizenship for the estimated 11 million undocumented immigrants in this country.

As Daisy Hernandez reports at ColorLines, “Obama acknowledged the political realities in Congress and talked with the group about smaller bits of immigration legislation, including a bill to permit undocumented young people to attend college,” according to attendees of the brainstorming sessions.

Hernandez explains that “Republicans are painfully aware, of course, that immigration might be this year’s election football.” During the lead up to the election this November, the Senate failed to come to a compromise or even sponsor an actual bill. The House of Representatives has sponsored a reform proposal, but won’t vote on it until the Senate takes action. It’s a sticky Catch-22.

No more Arizonas

Despite Congressional fumbling, the need for immigration reform certainly won’t go away any time soon. Latino voters are growing in influence every day in the Untied States. As Gabriel Arana reports for The American Prospect, “the anti-immigrant push has served to unify and mobilize Hispanic voters, leading them to rethink their ties to Republicans and demanding action from Democrats on immigration.”

Just last March, an estimated half a million reform supporters marched on the National Mall in Washington DC. Shortly after that, on May 1, tens of thousands marched in cities all over the country, with reform proponents participating in civil disobedience in the nation’s capital and Arizona.

Arana also notes that Latinos have had “historically had lower levels of political participation than other minority groups” in the political process, and now they are taking the reform cause to “the streets, to their representatives, and in the pages of Latino papers—on an issue that affects them directly.”

That means that Republicans in Florida—a state which has a Latino population of approximately 20 percent, according to the US Census—will likely face big hurdles in their attempt pass an Arizona-like law targeting undocumented immigrants and racially profiling Latinos. New America Media has been reporting on the Florida proposal, which, like Arizona, could lead to a major international backlash.

According to their coverage, the plan would “make remaining illegally in Florida a criminal offense,” would “include severe penalties for employers who hire undocumented workers,” and it would “allow police to ask suspects for proof of legal residency.”

‘Take Our Jobs’

On a lighter note, migrant workers have started a campaign to educate the public about the arduous work immigrants do on farms and in the fields—work that would be too tough for most Americans.

As Bonnie Azab Powell at Grist reports, the United Farm Workers, “tired of being vilified as stealing jobs from unemployed American citizens” have come up with a new campaign to put everyone to work.

“The union has created a website where you can sign yourself up for fieldwork,” Powell writes. “Experienced field hands will train legal residents and hook them up with the many seasonal harvest openings in California, Florida, and elsewhere.”

But the work won’t be easy, or just. As the article notes, “federal overtime provisions don’t apply to farmworkers, nor do minimum-wage laws.”

This post features links to the best independent, progressive reporting about immigration by members of The Media Consortium. It is free to reprint. Visit the Diaspora for a complete list of articles on immigration issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, and health care issues, check out The Audit, The Mulch, and The Pulse . This is a project of The Media Consortium, a network of leading independent media outlets.

Weekly Diaspora: Obama Deploys Troops to Border Amid Rising Civil Disobedience

Posted May 27, 2010 @ 10:45 am by
Filed under: Immigration     Bookmark and Share

by Erin Rosa, Media Consortium blogger

Image courtesy of Flickr user jim.greenhill, via Creative Commons LicensePresident Barack Obama announced on Tuesday that he would be deploying 1,200 National Guard troops to the Mexican border to beef up security along the Río Bravo. This surprise move has garnered criticism from immigrant rights supporters, who argue that it will dehumanize and endanger immigrant and Latino communities.

Julianne Hing at RaceWire offers more details on the plan, reporting that an extra $500 million has also been allocated to law enforcement along the border.

“Obama is reportedly asking for these troop increases in anticipation of Republicans’ demands on a war spending bill this week,” Hing writes. “But Obama’s already outpaced his predecessors in spending on border security and military presence at the border.” (more…)

Weekly Diaspora: Legislating Hate

Posted Oct 29, 2009 @ 8:01 am by
Filed under: Immigration     Bookmark and Share

By Nezua, Media Consortium Blogger

Anti-immigration groups and pundits cling to phrases like “Illegal Alien” because they only focus on foreignness and danger. These extreme factions are all about casting immigrants as what ails our society, conjuring up demons upon which to focus national ire, and perpetuating a subhuman category of being. It’s a convenient distraction from things that are actually endangering our nation. A new web-only series from ColorLines called “Torn Apart by Deportation is the perfect antidote to people like CNN’s Lou Dobbs. (more…)

Weekly Audit: Radical Inequality Fueled the Wall Street Meltdown

Posted Jun 30, 2009 @ 9:30 am by

Now that Treasury Secretary Timothy Geithner isn’t going to impose pay restrictions on bailed out Wall Street executives, it’s critical to remember that severe economic inequality was a major factor in the financial meltdown. Our tax code funnels money into the hands of our wealthiest citizens, which means that our financial system protects the interests of the affluent—not the the average citizen. The broad divergence between our core democratic values and the existing U.S. economic structure must become part of the public debate over financial reform.

As Les Leopold notes in a roundtable discussion with GritTV’s Laura Flanders, much of the Wall Street meltdown can be traced to a steady redistribution of wealth to the wealthy dating back to the Reagan years. Poor people, after all, do not have money to invest in the Wall Street speculation machine. By 2007, the financial world accounted for over 40% of U.S. corporate profits, an astounding percentage for a business intended to facilitate the operation of other industries. According to Leopold, we need to find constructive ways to shrink the financial sector, like taxing Wall Street transactions to move money into the real economy or imposing meaningful pay caps on financial jobs.

Pay for citizens who live outside the executive class has been steadily falling for decades. As Chuck Collins and Sam Pizzigati note for AlterNet, weekly wages for average Americans are now below 1970s levels after adjusting for inflation, while CEO payouts have exploded. So far, President Barack Obama has been hesitant to fight economic inequality at either end of the spectrum. Remember the promises he made to curb extravagant CEO pay on Wall Street back when the AIG bonuses were generating outrage back in February? Treasury Secretary Timothy Geithner has already made them irrelevant, eliminating a $500,000/year salary cap.

While we’ve heard quite a bit about how Wall Street excess wreaked havoc for homeowners, relatively little attention has been paid to the plight of renters, who often face personal catastrophe when their landlord is foreclosed on. Under a new law passed by Congress, when a bank or new owner takes control over a foreclosed property, they have to give renters living in the home at least 90 days notice before evicting them. But the law does nothing to address other injustices renters face. If your landlord is foreclosed on, for instance, you can forget about getting your security deposit back, even if the house is in top condition.

Banks also are not required to hire property managers to maintain homes they take over, which means they often let houses deteriorate despite objections from tenants. Writing for The Colorado Independent, Martha White explains that these problems are easy to correct, if Congress actually wanted to: Require landlords to put security deposits in a special account that cannot be raided by creditors in bankruptcy and force banks to hire managers to maintain the properties they foreclose on. The latter policy would also discourage banks from foreclosing in the first place by making ownership of the property more expensive for the bank.

Obama recognizes the need for change, which is why he’s proposed a major overhaul of the government’s Wall Street oversight. But in many ways, his plan identifies the wrong problems and offers the wrong solutions. The Real News features a great video spot with commentary by University of Massachusetts at Amherst Economist Robert Pollin. One of the key reforms involves granting the Federal Reserve broad powers to oversee systemic risk in the economy, but the Fed already has similar authority.

“The problem is, the Fed has already had an enormous amount of regulatory power, they just don’t exercise that power,” Pollin says.

Instead of granting the Fed more power, we should be finding ways to hold its leaders accountable. By subjecting top officials at the Fed to democratic elections, we could help ensure that the top regulatory body in the U.S. answers to the people it is supposed to be protecting.

Other creative new approaches to combating the economic crisis are featured in the most recent issue of Yes!, which is devoted entirely to economic reforms. From tips on investing locally to overhauling our broken monetary system to empowering workers, the issue emphasizes solutions that rely on democratic structures, rather than the corporate status quo (full disclosure: I’ve got an article in there on community banks).

It’s time to put some political firepower behind those ideas. Ordinary people simply have no serious voice in the policy debate surrounding Wall Street. In The Nation, Christopher Hayes describes the banking lobby’s total domination over financial reform proposals.

“On the other major legislative battles—healthcare, climate change, the Employee Free Choice Act—there is an organized, mobilized permanent infrastructure to push lawmakers in a progressive direction,” Hayes writes. “They may be underdogs, but at least it’s a fight.”

Changing the too-big-to-fail financial sector must become a priority. If we defer to the banking lobby or advisers like Larry Summers, who helped create the crisis by backing wildly deregulatory laws during the Clinton years, we can guess what the end result will look like. If we want our economy to answer to us, we have to do something about it. Income inequality and unaccountable regulators were a major part of the financial collapse. Addressing those problems has to be part of the economic solution.

This post features links to the best independent, progressive reporting about the economy. Visit and for complete lists of articles on the economy, or follow us on Twitter. And for the best progressive reporting on critical health and immigration issues, check out and This is a project of The Media Consortium, a network of 50 leading independent media outlets, and was created by NewsLadder.

Weekly Audit: Ending the Economic Status Quo

Posted Jun 9, 2009 @ 8:31 am by
Filed under: Economy     Bookmark and Share

by Zach Carter, TMC MediaWire Blogger

The banking lobby still holds enough sway inside the Beltway to torpedo sensible consumer protection rules, even after releasing a flood of predatory mortgages that kicked off the current economic crisis. On issues ranging from payday loans to subprime mortgages, the banking industry continues to successfully defend itself against new regulations that would protect the consumer. As if that weren’t outrage enough, the finance lobby has also joined other corporate interest groups to fund misinformation campaigns that smear unions and block wage growth.

As Mary Kane explains for The Colorado Independent, the push to rein in predatory mortgage lending appears to be losing steam on Capitol Hill. An extremely complex mortgage reform bill that is conciliatory to the finance lobby passed the House last month, angering consumer advocacy groups. Among the problems: the bill pre-empts many stronger state predatory lending laws and protects the Wall Street investment banks that gorged themselves on mortgage-backed securities.

Consumer protection shortfalls are not limited to messy mortgages. Lagan Sebert and David Murdoch detail the payday loan industry’s continued assault on U.S. consumers for the American News Project. By offering small loans, typically in amounts ranging from a few hundred to a few thousand dollars, payday lenders target consumers who need money for basic necessities, then charge them outrageous interest rates (as in, above 700%).

For years, newspaper editorials have denounced payday lenders for systematically exploiting the most vulnerable members of society, including members of the U.S. military, who are often targeted as a result of their reliable paychecks. The solution to the problem is as simple as the business is repulsive: Capping annual interest rates on all consumer credit products at 36% would make this kind of predation impossible.

Nevertheless, the payday loan industry has been able to escape a regulatory crackdown via an intense and sustained lobbying effort. Senate Banking Committee Chairman Chris Dodd, D-Conn., is now parroting payday lending lobbyists. Since payday loans are supposedly paid back within a matter of weeks, Dodd and the payday lending lobby say that it’s unfair to hold them subject to the same standards as a 30-year mortgage.

The argument is insane. No bank would ever get away with charging a 36% interest rate on a mortgage. Even the most predatory subprime mortgages didn’t have interest rates anywhere near that high. But Sebert and Murdoch go further, highlighting a report from the Center for Responsible Lending which found that payday lenders make 90% of their revenue from borrowers who do not pay their loans off on time. The loans are structured to be so expensive that consumers become trapped into making payments for the long-term, often spending thousands of dollars over multiple years to get out from under an initial loan of just a few hundred dollars.

Dodd has received major campaign contributions from the banking industry, but sometimes the lobbying effort is much more subtle. Several major corporate lobby groups have united under the misleading moniker of “Alliance to Save Main Street Jobs” to finance shoddily researched projects that defend the interests of the executive class in economic policy. An Alliance for Main Street Jobs report written by Anne Layne-Farrar has received quite a bit of attention for its claim that the Employee Free Choice Act (EFCA) would kill 600,000 jobs by making it easier for employees to organize. Several major news outlets have cited the allegation, including Fox News, MSNBC, The Wall Street Journal, and CBS News. As Art Levine reveals for In These Times, however, this research relies on completely meaningless statistical trends and disingenuous research design that render its findings utterly hollow.

Corporate executives are not afraid of EFCA because they think it will kill jobs or disenfranchise workers. They are afraid because it will empower workers to fight for living wages and provide safe working conditions—things that leave less money around for big executive bonuses at the end of the year and give workers a greater say in how companies operate.

In some respects, EFCA also represents the other side of the predatory lending problem. It is important to ban abusive loans, but it is just as important to make sure people are paid fairly for their work to ensure they don’t need to seek out shady credit just to make ends meet.

When so many brewing legislative battles relate to the economy, it’s easy to forget about the programs that have already been enacted. Some of the tax cuts included in the economic stimulus package were aimed at fostering investment in low-income and minority neighborhoods—a worthy goal. But as Michelle Chen notes for ColorLines, the program has some significant flaws. Chen highlights a report from the Government Accountability Office (GAO) which found that minority-owned community development entities are largely being excluded from the program, with approval rates about 67% lower than other applicants. The GAO could find no reasonable explanation for why minorities were not making the cut, especially when some recipients of the tax credits have a history of consumer exploitation. Capital One Bank, for instance, is receiving $90 million of these tax credits, despite its long history of abusive subprime credit card lending.

There have been some successes this year in the push for an economy that answers to workers and consumers. Much of the stimulus bill is designed to make sure important jobs don’t disappear during the recession, and Sen. Dodd’s credit card reform bill passed both chambers of Congress by comfortable margins and included some very strong improvements. But we know what caused the economic crisis: stagnant wages and predatory lending. A true recovery will have to empower workers and protect consumers, both of which will require breaking with the corporate status quo.

This post features links to the best independent, progressive reporting about the economy. Visit and for complete lists of articles on the economy, or follow us on Twitter. And for the best progressive reporting on critical health and immigration issues, check out and This is a project of The Media Consortium, a network of 50 leading independent media outlets, and was created by NewsLadder.

Weekly Immigration Wire: Child of Immigrants Nominated to Supreme Court

Posted May 28, 2009 @ 10:31 am by
Filed under: Immigration     Bookmark and Share

by Nezua, TMC MediaWire Blogger

On Tuesday, President Obama announced Sonia Sotomayor as his pick to replace Supreme Court Justice David Souter. Sotomayor could be the first Latina appointed to the Supreme Court. Predictably, attacks and slurs from the Right are already flying. Regardless, Sotomayor would be an excellent choice for the Supreme Court, signaling to Latino/as that the White House is aware of our need for more representation in government.

Reporting on Sotomayor’s nomination, the Washington Independent’s Daphne Eviatar notes that, while the choice doesn’t push the envelope in terms of liberalness, it does indicate that Obama was “willing to stand up to unfounded criticism of Sotomayor as a far-left liberal.” Interestingly enough, President George H. W. Bush originally nominated Sotomayor for the district court, and her life reads like Many GOP-adored tales of hard work leading to success.

Which leads one to wonder why are they attacking Sotomayor’s nomination with such vitriol, by painting her as a “radical, judicial activist/scary Latina feminist/underqualified diversity pick“? As Michelle Chen reports for RaceWire, Sotomayor has a reputation for “principled independence suffused with real-world experience” and the GOP’s squawking is a typical barrage of “hypocrisy, shrill animosity and racist code words.”

Sotomayor describes herself as a “Newyorican,” which is someone who has been born in New York City from parents hailing from Puerto Rico. While her nomination sparked controversy as to whether or not one can technically “immigrate” from Puerto Rico, there is no denying the country’s colonial history. Many see Sotomayor’s nomination as a success story for immigrants. She certainly does.

New America Media’s Roberto Lovato writes that despite the GOP’s desire to overlook Sotomayor’s uplifting and quintessentially “American” story, the Republican party would do well to use this opportunity very carefully. Sotomayor’s nomination provides an opportunity to draw a line between the GOP that bled Latino/a votes due to their immigration stance and what they hope to become. According to Lovato, Sotomayor—and we—should view the confirmation hearings as “nothing less than a trial to determine whether the GOP is ready to make restitution for its role in a number of judicial and political wrongdoings perpetrated in the Bush era.”

But it doesn’t seem that the Republican party is very concerned with the Latino/Hispanic vote, let alone common decency, judging by the desperate moves of California Governor Arnold Schwarzenegger, an immigrant himself. In an attempt to clean up the state deficit, Schwarzenegger would “eliminate four programs that provide money and food to more than 100,000 legal immigrants,” many “elderly and disabled.” This action will hurt many people who are a vital part of our social fabric.

Daphne Eviatar, writing for the Center for Independent Media, reports on the perversely-named “Secure Communities” initiative, in which ICE officals are quoted defending a program that aims to deport those ticketed for so much as a red light. Under this soon to be expanded program, the Department of Homeland Security (DHS) plans to deport “tens of thousands” of immigrants in 2010. Under the Secure Communities initiative, even a legal immigrant could be deported if accused and not able to hire or enlist legal representation.

Secure Communities “represents a new comprehensive approach to remove all criminal aliens held in the United States prisons and jails.” Even the phrase “criminal aliens” conjures up visions of hooded creatures with sinister intent…and maybe dangling antennae. Little is required to sweep an immigrant into the detention system and classify them as “criminal.” It can be nothing more than an overstayed visa, or being profiled at a 7-11 by ICE officials looking to make quota. It’s all part of a thriving detention industry: DHS projects a budget for new detention centers, including the needed number of arrests (400,000 are planned for next year) to fund and staff said centers. As a result, arrests are made for any infraction, imagined or real, the beds are filled, the lawyers can’t be afforded and aren’t provided, workers and family members are deported, the budgets justified, the checks cut, and the detention center industry looms larger every day.

In Deportation While U Wait, RaceWire’s Michelle Chen reports that ICE has found a way to further expedite the process. “At one downtown Los Angeles courthouse,” Chen writes, “Officials have found an efficient way to cut through the red tape: kicking people out of the country without waiting for a decision from the judge.” If there is a previous deportation order in their records, ICE rules on their own and deports the man or woman. But we should be careful to rush to judgment as often, “what looks on paper like a justifiable deportation often masks the nuances of individual hardships and structural problems that limit immigrants’ ability to press their legal cases.”

In the Colorado Independent, Erin Rosa reports that the Obama Administration is moving forward with plans to end the State Criminal Alien Assistance Program, which funds local jails and state prisons to house undocumented immigrants. Rosa notes that Colorado “netted $3.1 million from the program last year, and $3.3 million in 2007.” The White House defends the move by saying the resources can “better be used to enhance federal enforcement efforts.”

There are many people waiting to see those “enhanced” efforts in the shape of legislation. There is hope these efforts will improve the quality of peoples’ lives, not DHS’s budget. Many people who harbor those hopes demonstrated in Postville, Iowa in memory of the ICE raid that shattered the community a year ago. Lynda Waddington writes of this year’s difference in attitude for the Iowa Independent. In 2008, emotions were raw and more anger was expressed, but this year, there was “a specific focus and call for comprehensive immigration reform.”

This post features links to the best independent, progressive reporting about immigration. Visit for a complete list of articles on immigration, or follow us on Twitter. And for the best progressive reporting on critical economy and health issues, check out and This is a project of The Media Consortium, a network of 50 leading independent media outlets, and was created by NewsLadder.

Weekly Audit: Why the Current Stimulus Plan Isn’t Enough

Posted Apr 7, 2009 @ 8:53 am by

by Zach Carter, TMC MediaWire Blogger

The U.S. economy just keeps getting worse. Given the absolute pummeling the job market has taken over the past five months, we’re going to need some much stronger medicine than policymakers are currently proposing. It’s increasingly clear that President Obama’s stimulus plan was devised for a far milder downturn, and this week we received further evidence of the recession’s high human cost.

The U.S. lost another 663,000 jobs in March, according to a report released by the the Labor Department last Friday. Most of us are getting used to seeing big numbers associated with this recession, but those massive layoffs are perhaps the most distressing statistics of all. Jobs matter most to ordinary people right now, as John Nichols notes for The Nation, and the primary measure of success for any economic policy is whether it will get people back to work. Nichol’s argument stands in sharp contrast to what much of the news media is using as its metric of success: the Dow Jones Industrial Average.

Speculators on Wall Street have pointed to the Dow’s recent upward trend as evidence that things are getting better. We’ll see if that uptick continues after the next round of quarterly banking losses comes in, but even if they do, Nichols emphasizes, happy speculators are not the same thing as a happy economy.

The national unemployment rate currently stands at 8.5% and, without a dramatic increase in government support, will likely be mired in double digits for years to come. Nobel-Prize-winning economist Joseph Stiglitz puts it succinctly in an interview at Salon: “This model no longer works. The Americans are completely over-indebted. They can’t increase their consumption, instead they have to save.”

The recession’s growing severity underscores a host of long-brewing economic problems, not the least of which is access to a college education. The cost of tuition has been steadily soaring for decades, but with the life savings of many families decimated by the housing bust, even relatively inexpensive state schools are out of financial reach, as Andy Kroll illustrates for Mother Jones.

“Simply to ensure that a child attends a four-year public university, a family in the country’s lowest-income bracket now has to pay, on average, 55% of [their] total income,” Kroll writes. That’s not 55% of disposable income, that’s 55% of what the family is taking in, period. President Obama has proposed some solid remedies for this issue—increasing federal grants for low-income students and replacing overpriced private-sector student loans with cheaper government loans, to name a few. But Kroll notes that it’s also important to divert more federal stimulus funds to states to increase the flow of need-based financial aid at public universities.

For many younger students, attending college takes a backseat to making sure they have a roof over their heads. One out of every 50 children in the United States is homeless. This problem will not go away on its own, Randy Jurado Ertll writes for The Progressive. Ending homelessness for children would cost just a fraction of what we’re paying to bailout the nation’s largest banks—there is no excuse for ignoring the issue in the next round of recovery funding.

The housing collapse continues to deepen, but some policies designed to help families keep their homes are quietly expiring. In a story for The Colorado Independent, Mary Kane points out that the moratorium on foreclosures imposed by mortgage giants Fannie Mae and Freddie Mac expired at the end of March. Foreclosure-related evictions are set to resume.  Just as depressing: none of the mainstream media seems to have noticed.

As foreclosures escalate, one policy option that would keep families with a roof over their heads is being generally ignored by both the government and the banking world: renting. If, Kane notes, banks rented foreclosed properties to the borrowers who can no longer afford them, the most devastating impact of the foreclosure crisis could be averted.

But instead of dealing with actual problems, some Senators remain more focused on throwing money at rich people. The estate tax has actually surfaced in the recent haggling over the federal budget, Steven Benen notes for The Washington Monthly, a tax that only applies to the richest 0.2% of American families.

We’ve seen enough giveaways to wealthy people in the recent bank bailouts, and we know that they have extremely limited economic benefits. Steering the economy toward recovery will require a much more aggressive investment in the livelihood of ordinary Americans.

This post features links to the best independent, progressive reporting about the economy. Visit and for complete lists of articles on the economy, or follow us on Twitter. And for the best progressive reporting on critical health and immigration issues, check out and This is a project of The Media Consortium, a network of 50 leading independent media outlets, and was created by NewsLadder.

Weekly Audit: How Predators are Profiting from the Economic Collapse

Posted Mar 10, 2009 @ 9:05 am by
Filed under: Economy     Bookmark and Share

While the economy sinks into the abyss, some of the financial industry’s most egregious scam artists are already back on the prowl looking to take advantage of troubled borrowers.

In a sickening turn of events, financial professionals who profited from the predatory Wall Street mortgage regime are now remodeling themselves as specialists to help consumers avoid foreclosure. The Nation Institute helped fund a devastating expose written by Alyssa Katz on the mortgage broker makeover. published in Katz details how an industry that once pushed people into unaffordable loans with deceptive marketing and misleading documentation is now raking it in by helping people who are behind on their mortgages obtain modified loan contracts.

“The problem is that the majority of loan mods are lousy deals for homeowners,” Katz writes. “Federal banking regulators recently determined that more than half of all mortgages that were modified by lenders in early 2008 ended up heading into foreclosure again in less than six months. Most loan modifications, in fact, dig borrowers deeper into debt.”

These predators cash in on setting borrowers up for a fall, and instead of being barred from the banking world or prosecuted, end up raking in again to help them renegotiate their mortgages.  Loan modifications almost never reduce how much borrowers actually owe on their mortgages. Often, whatever amount a borrower is behind by is added to the overall debt burden, giving banks a bigger pool to collect interest on. Nearly half of all loans modified in the fall of 2008 did not even result in a lower monthly payment for borrowers.

Over at Colorlines, Dom Apollon highlights the rise of a new mortgage company called PennyMac run by former Countrywide executives—the same Countrywide that is being sued by local governments for destroying communities with abusive subprime loans. PennyMac plans to buy delinquent mortgages on the cheap, alter the terms of the loans to keep borrowers in their homes, and pocket the difference between the new mortgage payments and what it paid for the loans as profit. If you think that is going to end well for the homeowners, then I’ve got a few condos in south Florida to sell you.

People who cause massive problems are not usually the best people to solve them. That’s why when the U.S. government agreed to bail out the world’s largest insurance company, AIG, policymakers kicked out CEO Martin Sullivan. But even after being nationalized, AIG has continued to drain taxpayer coffers, coming back to the bailout trough twice for a total of over $160 billion. To put that number in context, it’s about what the entire savings and loan crisis cost taxpayers back in the late 1980s and early 1990s.

Josh Marshall has a series of excellent posts on the AIG drama for Talking Points Memo. When the Federal Reserve and the Treasury Department refused to let AIG fail back in September, it was supposedly because letting AIG default on its enormous credit default swap business would be a disaster for the financial system. Credit default swaps were originally designed as insurance for loans. If a Goldman Sachs made a loan to Bank of America, Goldman could get AIG to insure the loan against default. Goldman would pay AIG a few dollars a month in insurance premiums, but if Bank of America failed to pay up, AIG would reimburse Goldman for the entire value of the loan. Eventually, however, the process got crazy. Companies started taking out “insurance” on transactions they had no involvement with. JPMorgan could go to AIG and agree to pay a few dollars a month in case Bank of America defaulted on its loan from Goldman Sachs– essentially betting with AIG on whether Bank of America would pay Goldman back. The same contracts could be used to insure mortgage-backed securities against default. Wall Street eventually put more money in credit default swaps than an entire year’s worth of global economic output.

By keeping AIG running on taxpayer support, Marshall notes, the government is essentially using the company as a conduit to funnel tax dollars to other major financial firms who made credit default swap bets with AIG. Who is getting the AIG bailout money? Neither the Treasury or the Fed will say, and Marshall points out, the government refuses to even explain why it will not tell us who is getting money. Maybe the government is worried that investors will pull their funds out of companies who are scoring big paydays from the AIG bailout, deeming them nonviable without government support.

That may very well happen. But indefinitely pouring federal money into Wall Street companies through AIG is not a solution, and taxpayers deserve to know how their money is being spent.

But at least one system for fleecing taxpayers seems to be on its last legs if President Barack Obama has his way. About four-fifths of student loans are made by private lenders who are subsidized by the government, while the remaining 20% are made directly to students by the Department of Education. The problem with the private-sector partnership plan is its inefficiency: a lot of that subsidy money goes to paying student loan company executives, while some of it simply ends up as profits for the bank. How much? According to Aaron Tang of Wiretap Magazine, Obama’s budget proposal would kill the subsidy program and instead invest that money in the direct loan program, freeing up $4 billion a year, enough to help millions of students pay for a college education.

The Obama administration’s willingness to end irrational financial policies should not end with the student loan program. Predatory lenders who created the mortgage meltdown should be barred from the banking industry, and the Treasury needs to be honest with taxpayers about who it is paying off.

One Last Note
The unemployment numbers keep getting worse: after losing almost 600,000 jobs in January, the U.S. economy shed another 651,000 in February, sending the unemployment rate all the way to 8.1%. As Steve Benen notes for The Washington Monthly, the accelerating job losses may not be surprising at this point, but they are painful nevertheless. The only good news for the labor market over the last week was the roll-out of, a site dedicated to informing workers on their legal rights on everything from COBRA health insurance benefits to getting employers to actually deliver final paychecks workers have already earned. The site, which is funded and managed by Interfaith Worker Justice, comes at an important moment, according to Wendy Norris of The Colorado Independent, who highlights that the unemployment rate would be a massive 14.8% if it included people who have been looking for a job for more than a year and people who want full-time work but are can only get a part-time position.

This post features links to the best independent, progressive reporting about the economy. Visit and for complete lists of articles on the economy, or follow us on Twitter. And for the best progressive reporting on critical health and immigration issues, check out and This is a project of The Media Consortium, a network of 50 leading independent media outlets, and was created by NewsLadder.

Weekly Audit: Stimulus Stagnation

Posted Feb 3, 2009 @ 10:00 am by
Filed under: Economy     Bookmark and Share

Despite a lofty launch last week, the good ship Bipartisan is sunk, at least so far as the economic stimulus is concerned. President Barack Obama and House Democrats bent over backwards to appease the GOP by including several tax breaks and excluding a major anti-foreclosure measure from the package, but when it came time to vote, zero House Republican backed the bill. Lawmakers who actually care about the fate of the U.S. economy are furious. Every day spent haggling with obstinate Republicans means heavier economic damage. What’s more, many of the tax breaks the GOP insisted on are simply terrible policies, whatever the economic climate.

“Not surprisingly, some Democrats who did deal with the GOP as if they were reasonable want to reverse the concessions they gave up,” Steven Benen writes for The Washington Monthly.

Even some conservative economists want to strip out the Republican provisions. On this week’s Stimulus Plan NewsLadder, many reporters and bloggers respond to Martin Feldstein‘s newfound opposition to the stimulus package, as revealed in a Washington Post op-ed. Feldstein, who was chief economic adviser to President Ronald Reagan, initially came out in support of the package but recently reversed his opinion, but on surprising grounds.   While progressives have noted that some of Feldstein’s criticisms of the House bill are off-base, they have also emphasized that his take on several stimulus plan tax cuts, actually come from the ideological left. As blogger Dylan Matthews put it in a guest blog for Ezra Klein at The American Prospect: “You know when your stimulus package is too cautious? When Marty Feldstein is attacking it from the left.”

One of Feldstein and the left’s major problems with the package: the  corporate “net operating loss carryback” (NOL) giveaway. The NOL carryback works like this: companies who lost money in 2008 will get an immediate refund for taxes paid on previous, profitable years. Right now, the carryback limit is two years. The stimulus bill would change the law to refund companies every penny they paid in taxes for the past five years, so long as the company lost more than that five-year sum in 2008.

Tax cuts can be economically helpful when they create incentives for people to act in socially beneficial ways. For example, offering a company a deduction for starting a windfarm creates jobs and establishes an environmentally friendly power plant. Giving away billions of dollars to companies simply because they lost money, by contrast, encourages nothing. What’s more, many businesses lost money in 2008 because they were in bloated sectors that needed to get smaller. The U.S. has too many banks and too many homebuilders—that’s one of the reasons why so many banks and homebuilders are struggling right now. A lump-sum payment will not fix the underlying problem.

Not all of Feldstein’s recommendations are good ideas– Josh Marshall of Talking Points Memo offers a particularly good rejection of his push for increased military spending—but Feldstein’s argument nevertheless makes the Republican leadership look like a total farce. “His critique is nothing like the Republican claptrap we’ve been hearing over recent days,” Marshall writes. “In fact, in some respects it’s like stuff I’ve been hearing from Democrats.”

House Democratic concessions on the stimulus involved more than new tax cuts—they also excluded several important provisions to keep the GOP happy. Republican leaders successfully lobbied Obama to bar mortgage bankruptcy reform from the bill, blocking the most important legal step necessary to reduce foreclosures. It is the second time Obama has urged Democrats to abandon the bankruptcy rule change to garner Republican support for a major bill—the first was the Wall Street bailout bill that passed in October. Even if the bankruptcy legislation passes at some point in the future, many borrowers in trouble now will lose their homes before the law changes.

“That stance has piqued some Democrats, who are beginning to wonder if the push for bipartisan agreement is worth the cost of waiting,” Mike Lillis writes for The Colorado Independent. “For each day that Congress dallies, these lawmakers say, thousands of Americans lose their homes to foreclosure.”

According to the Center for Responsible Lending, we will see 6,000 foreclosures every day this year on subprime mortgages alone.

Let’s conceptualize how the bill could change the mortgage landscape. Imagine that you get laid off and start working a job with lower pay, rendering your mortgage payments unaffordable. In many circumstances, your bank would want to modify your loan so that you owe them less money, because the alternative—foreclosure—creates an even bigger loss for the bank. The trouble is, banks frequently do not have the ability to alter loans, because they sell them to a third party investment bank. The investment bank packages the loan into a security with a hundred or so other mortgages and then sells it to dozens of investors. Now, hundreds of signatures are required to modify your mortgage—and not all of the investors have your interests at heart. Some would rather see you default on your mortgage, because they know the decreased value of the security will hurt their competitors more than it will hurt them.

But if bankruptcy courts could compel loan modifications, all of this investor warfare would be avoided. You file for bankruptcy and the court will “cram down” the amount you owe on your mortgage and banks or investors simply eat the difference as a loss. No taxpayer-funded bailout necessary.

Obama’s economic work will not stop with the stimulus legislation. Major regulatory reform is needed on a variety of financial fronts, not the least of which is preventing borrowers from getting stuck with predatory mortgages in the first place. As Stephanie Mencimer of Mother Jones notes, the Federal Reserve appears to be softening its long-time anti-regulatory stance. The steps are small, but significant. While the Fed’s new rules barring some abusive credit card billing practices didn’t go far enough, they mark the first time the Fed has acknowledged that common lender practices are straightforwardly unfair. The central bank has even hired a consumer activist as a policy adviser.

For all its faults, however, Obama’s stimulus gets several important policies right. In a piece for The Nation, Robert Pollin notes the dramatic new shift in tone regarding the compatibility of environmental sustainability and economic justice. After decades of debate that pitted the plight of workers against saving the environment, people are finally waking up to the idea that we might create good paying jobs to fight global warming.

For now, the recession continues to grind on, with strange and depressing surprises appearing everywhere—even grocery store shelves. Jim Hightower unveils a new trend among producers to shrink product sizes while maintaining their prices, effectively raising the cost to consumers. The shrink-ray tactic has been deployed on toilet paper, cereal, peanut butter and who knows what else. Thanks to tricky marketing and packaging, you might not even realize when you’ve been ripped off.

This post features links to the best independent, progressive reporting about the economy. Visit and for complete lists of articles on the economy, or follow us on Twitter. And for the best progressive reporting on critical health and immigration issues, check out and This is a project of The Media Consortium, a network of 50 leading independent media outlets, and was created by NewsLadder.