The Wire

More Americans worried about money and believe “rich are getting richer, poor are getting poorer”

The American people have growing concerns about their financial situation.  When almost half the respondents "don't have enough money to make ends meet" in a new Pew Research Center Poll, there is a pervasive financial insecurity in the country.  Congress has ignored -- and worked against -- the economic needs of the middle class for over a decade.  That has to change: 

More broadly, the poll finds that money worries are rising. More than four-in-ten (44%) say they "don't have enough money to make ends meet," up from 35% in 2002. While a majority continues to say they are "pretty well satisfied" with their personal financial situation, that number is lower than it has been in more than a decade.

In addition, an increasing number of Americans subscribe to the sentiment "today it's really true that the rich just get richer while the poor get poorer." Currently, 73% concur with that sentiment, up from 65% five years ago. Growing concerns about income inequality are most apparent among affluent Americans; large percentages of lower-income people have long held this opinion.

Posted by Staff on Friday, March 23 | 191 comments | Permalink

How Predatory Lending Hurts Average People

Shanna Smith, chief executive of the National Fair Housing Alliance, said lenders often targeted the most vulnerable borrowers for subprime loans, even if they were eligible for loans with lower rates. More often than not, the borrowers had little understanding of mortgages.

The Reuters article, goes on to say, "subprime loans allowed many Americans with spotty credit to buy into the housing boom, driving home ownership to nearly 69 percent nationwide in 2006, up from 65.4 percent a decade earlier."  The housing market and the fallout from subprime loans has been a constant, and important, conversation recently.  It's obvious that there's a story about personal responsibility here, but there's also a big story about how lenders attract and then finance people who are very unlikely to be able to pay back the loan (and what they thought would happen after a couple of years).  Congress is expected to examine the circumstances, and possible solutions, to this bad situation with subprime loans and the increasingly high number of foreclosures and selling offs.  And check out this March 22 NYT story, which puts it in even plainer terms:

Myriam Philemond says she knew almost from the start that she and her husband could not afford the nearly $500,000 house they bought in South Boston more than a year ago.

After falling behind on payments in July, she is considering whether to turn the house over to her mortgage company because she cannot refinance and modifying her loan will not help. “We are stuck with a house that we can’t afford,” she said...

...At the end of last year, more than 2.6 million home loans were either past due for more than 30 days or in foreclosure. About 40 percent of them were made to people with weak, or subprime, credit. Most economists predict that the number of troubled loans will continue to rise this year as more mortgages are adjusted to higher interest rates and home prices decline further.

Last year, more than 37 percent of subprime loans were made without verification of borrowers’ incomes, up from 15 percent in 2000, according to an analysis by JPMorgan Chase. Also, a third of borrowers took out a second mortgage, up from 6.8 percent in 2003, suggesting that they did not have enough money for a down payment.

These lenders aren't doing borrowers a service or providing a route to the American dream.

Posted by Web Team on Thursday, March 22 | 339 comments | Permalink

Audio and text of Montana ads challenging Baucus on Fast Track

As noted below, They Work For Us launched a radio ad campaign last week in Montana asking Senator Max Baucus to oppose unfair fast-track trade legislation. Listen to the ad here.

Here's the text:

Montanans value hard work, freedom, and self-reliance.  We know it’s our responsibility to keep our economy moving, but bad trade deals have hurt Montana.

Now, the Bush Administration, surprisingly with Senator Max Baucus’ support, wants the power to fast track these bad trade deals, costing Montana thousands of good-paying jobs and undermining our state’s rights.

Maybe that’s why Democrats and Republicans in the Montana State Senate voted overwhelming to urge Congress to stop President Bush’s ability to fast track these trade deals.

As Chairman of the US Senate Finance Committee, Max Baucus has the power to influence this debate about trade.  So please call Senator Baucus at 782-8700 (Butte)/329-3123 (Missoula) and ask him to reject fast track authority and stop trade deals that hurt Montana. 

Paid for by They Work For Us. 

Posted by Staff on Monday, March 19 | 649 comments | Permalink

“The Nation” profiles Senator Max Baucus (D-MT)

Meet "K Street's Favorite Democrat": 

Today, in the aftermath of the Democratic sweep of Congress, Baucus is still one of corporate America's favorite Democrats. As chair of the Finance Committee, he counts among his friends and political supporters a Who's Who of bankers, oilmen, ranchers, pharmaceutical lobbyists and Wall Street executives. He's particularly close to Montana's sole billionaire, industrialist Dennis Washington, a major donor to the Republican Party whose business interests Baucus has promoted over the years. The business community, in turn, expresses admiration for Baucus in its usual style--by writing big checks.

The Finance Committee has always had an incestuous relationship with corporate lobbyists, and with Baucus at the helm, the tradition continues. In their book about the tax reform act of 1986, authors Jeffrey Birnbaum and Alan Murray coined a term for the lobbyist-packed hallway outside the Finance Committee hearing room: Gucci Gulch. With jurisdiction over taxes, Social Security, Medicare, healthcare and international trade, the committee is the place that raises all the government's money and spends half of it. "It really is the committee, more than any other, that decides what kind of government you have," says Lawrence O'Donnell, former chief of staff of the Finance Committee, whose chair was Daniel Patrick Moynihan.

The rap on Baucus is that he has always valued his own re-election above all else. He's up again in 2008. The question is: What is he sacrificing to get there? When Democrats were in the minority, Baucus brokered the passage of two of George W. Bush's signature first-term achievements: his massive 2001 tax cuts and his 2003 Medicare prescription drug plan. He's spent the better part of the Bush presidency cutting deals with Republicans and infuriating members of his own party, voting for the war in Iraq, the energy bill, the bankruptcy bill and to confirm Supreme Court Justice John Roberts. On core economic issues, the very ones that come before his committee, only one Democrat, Nebraska's Ben Nelson, has a more conservative voting history, according to National Journal

Posted by Staff on Friday, March 16 | 2632 comments | Permalink

Ads target Baucus on Fast-track

As we've noted before, Senator Jon Tester (D-MT) and many of his freshmen colleagues in the U.S. Senate have taken strong stands against renewing the President's "fast-track" authority.  Tester's colleague, Max Baucus, as Chair of the Senate Finance Committee, will play a key role in the legislation to re-authorize fast-track before it expires in June.  

Today, They Work for Us, an independent 501(c)(4) organization, launched a radio ad campaign in Montana targeting Baucus on fast-track as reported by the Associated Press:

A liberal political group formed to hold Democrats in line is airing its first ad, urging a Senate Democrat to oppose giving President Bush renewed power to try to speed trade deals through Congress.

The plan is to run the radio spot aimed at Sen. Max Baucus, D-Mont. in 13 Montana stations for a week beginning Thursday.

The group, They Work For Us, has created some tension in the Democratic Party with its mission to instill discipline among lawmakers on issues dealing with health, the work place and the economy. The group's members include labor leaders as well as liberal activists.

Labor organizations want Congress to vote against renewal of a process that permits Congress only to vote up or down on trade deals, not amend them.

"The Bush administration, surprisingly with Senator Max Baucus' support, wants the power to fast track these bad trade deals, costing Montana thousands of good-paying jobs and undermining our state's rights," the radio spot states. The ads are airing in Butte, Bozeman and Missoula, where Democrats have a strong presence. 

Posted by Staff on Thursday, March 15 | 2337 comments | Permalink

Job losses lead to mortgage defaults in Ohio, Michigan

The economy is not working for many Americans.  No jobs, no mortgages.  It doesn't get much worse -- and the numbers of both are rising in Michigan and Ohio:

Job losses in the U.S. industrial heartland have left states like Michigan and Ohio more vulnerable to mortgage defaults, as home finance costs rise amid often moribund real-estate markets.

On a combined basis, Michigan and Ohio accounted for an out-sized 15 percent of foreclosures across the United States in January, the most recent month for which data is available from tracking service RealtyTrac.

Some 546,000 jobs have been lost in the two states since 2000, according to U.S. government figures, as shutdowns and layoffs at auto plants rippled through the economy.

Posted by Staff on Thursday, March 15 | 687 comments | Permalink

Freshmen Democratic Senators want a say on “Fast-track”

The new Democratic Senators, who ran and won on economic populism in 2006, are demanding a say in the discussions about the pending renewal of fast-track legislation.  The freshmen know first-hand the resonance of trade-related issues among the electorate -- and they intend to make their positions clear to Finance Committee Chair Max Baucus (D-MT):

"Years of job-killing trade agreements are taking their toll on workers and small business owners alike," said Sen. Sherrod Brown, an Ohio Democrat.

Brown and other so-called freshmen senators -- who were elected to the Senate for the first time last year -- ran campaigns that called for major changes in U.S. trade policy.

They have asked for a meeting with Senate Finance Committee Chairman Max Baucus, a Montana Democrat, to help craft a new direction for trade that gives Congress more control over pacts.

Baucus's committee is responsible for trade legislation. Other freshmen who requested the meeting include Sens. Benjamin Cardin of Maryland, Robert Casey of Pennsylvania, Amy Klobuchar of Minnesota, Bernard Sanders of Vermont and Sheldon Whitehouse of Rhode Island.

Trade issues matter to voters.  The candidates, now Senators, who ran and won in 2006, know that.  Their colleagues are going to have to know it, too. 

Posted by Staff on Tuesday, March 13 | 4127 comments | Permalink

Credit card companies, which benefitted from bankruptcy law, facing scrutiny for egregious practices

Today, a US Senate Committee held hearings on the outrageous practices of the major credit card companies in the U.S. like those that led an Ohio man to owe $10,700 on a bill of just $3,200:

While the credit card practices in question are legal, [Senator Carl] Levin is threatening possible legislation to outlaw them as a spur to the banking industry for voluntary changes.

Senate Banking Committee Chairman Christopher Dodd and other Democratic senators challenged credit card executives at a hearing in January over rising late fees and other penalties and marketing practices they portrayed as predatory. Dodd, D-Conn., said he was putting the industry on notice that if it doesn't improve practices on its own, legislation may be warranted.

Since Democrats assumed control of Congress in January, they have put a number of consumer issues on the legislative agenda. With Americans weighed down by some $850 billion in consumer debt, the practices of the robustly profitable credit card industry are a compelling subject for scrutiny. 

The credit card industry deserves scrutiny from Congress.  In the past, that industry has gotten its way with lawmakers, primarily, in the form of the anti-consumer bankruptcy bill.  As Kos at the Daily Kos reminds us, the credit card industry benefitted greatly from that law:

Without bankruptcy law protections (thanks Tauscher, Biden, and the rest of you Democrats who fought hard for this!), credit card companies have far lower risk. They can goad consumers into racking up massive debts without fear that bankruptcy will wipe those debts out. And have they responded to that reduced risk by lowering their interest rates or making sure only those who can afford it can borrow? Of course not.  

And, yes, that law, while passed in a Republican Congress, had plenty of Democratic support.  In fact, as Kos notes, several members of the New Democrat Coalition, led by Rep. Ellen Tauscher (D-CA), lobbied Speaker Dennis Hastert to bring the bankruptcy bill to the House floor for a vote.  

Democratic elected officials need to act in the interest of their constituents -- not the major corporate interests that abuse their constituents.  And, the abuse by the credit card companies is clearly rampant. Keeping Americans in debt is not a progressive value

Posted by Staff on Wednesday, March 07 | 507 comments | Permalink