ThinkProgress Logo

Economy

H&M Agrees To Safety Upgrades In Bangladesh

Seven Times Republicans Demanded The Budget Process They Are Obstructing

Unemployment Would Be A Point Lower Without Deficit Reduction

Education

Nearly 9 Million Students Facing Pell Grant Cuts If Congress Doesn’t Act

By Pat Garofalo on Oct 25, 2010 at 7:28 pm

When Congress comes back into Washington for a lame duck session following November’s midterm elections, it will have a few noteworthy tasks that it needs to accomplish. As Congressional Quarterly’s Chuck Conlon and Greg Vadala pointed out, one of these is the federal Pell Grant program — which provides higher education grants to middle- and lower-income students — as it is facing a substantial budget shortfall:

President Obama wanted to include extra money for Pell grants in the stopgap legislation that Congress enacted to fund the government until early December, one of many add-ons that were not included in the measure. Republicans mainly opposed Democratic efforts to add funding to the continuing resolution, which kept it relatively “clean”…If the Pell shortfall is not addressed, almost 9 million students would face a cut of more than 15 percent in their fiscal 2011 maximum award, said the Committee for Education Funding.

For the 2011 fiscal year, which theoretically began at the beginning of this month, the Pell Grant program is facing a roughly $5.7 billion shortfall. If it isn’t closed, the maximum grant under the program will be cut by some $845 for the 2011 academic year. And this will come at a time when, due to the lingering effects of the Great Recession, there will be about 8.7 million Pell Grant recipients, up from 7.7 million in 2009.

Of course, Republicans in Congress might very well be unwilling to play ball. After all, their plan for the federal budget, assuming they were willing to actually follow through on it if given the chance, would cut about $9 billion from the Pell Grant program, even in the face of increased demand. And a few Republicans have even advocated for reversing the student loan reform passed this year, resurrecting billions of dollars in senseless subsidies to bankers and further reducing the pot of money available for grants.

Keeping the Pell Grant program fully funded is about more than ensuring adequate access to higher education for lower-income students (though that, by itself, is a worthy goal). America has a falling level of educational attainment in relation to the rest of the world, and by 2025, according to estimates by the Lumina Foundation, the U.S. will be short 16 million college educated workers. So the nation’s supply of human capital and its ability to remain economically competitive with the rest of the world hinges on its ability to encourage a highly-educated workforce. Reducing the supply of Pell Grants would, obviously, have just the opposite effect.

Bank Of America Tries To Frame Foreclosure-Gate As Simply A Case Of Misspelled Names

By Pat Garofalo on Oct 25, 2010 at 3:31 pm

Since the foreclosure fraud scandal — in which banks were caught allowing “robo-signers” to approve potentially fraudulent foreclosure forms — first hit the national airwaves, Wall Street banks have been trying to downplay the extent of the problem, claiming that it only has to do with paperwork mistakes and not a compete disregard for due process and property rights. Wells Fargo and Citigroup both refused to implement foreclosure moratoriums despite their associations with robo-signers, and Bank of America and Ally Financial have both lifted their respective moratoriums.

Epitomizing the banks’ attempt to turn this into a story about mistaken paperwork — and not one about improperly throwing people out of their homes — Bank of America has come forth with an admission that it made “some mistakes” in its foreclosure process, but insists that they are “relatively minor”:

Some of the defects seem relatively minor, according to the bank, and bank officials said they haven’t uncovered any evidence of wrongful foreclosures. There was an address missing one of five digits, misspellings of borrowers’ names, a transposition of a first and last name and a missing signature on one document “underlying” an affidavit, a bank spokesman said. But the bank uncovered these mistakes while preparing less than 1% of the first foreclosure files that it intends to resubmit to the courts in 23 states.

Of course, BofA places the emphasis on innocent sounding mistakes like misspelling a homeowner’s name, and not on far more harmful instances, such as when it foreclosed on a homeowner who didn’t have a mortgage at all. Or when it locked a homeowner who was current on her mortgage payments out of her home, shutting off her utilities and stealing her pet parrot. If the banks are respecting due process, someone who literally does not have a mortgage should never receive a foreclosure notice.

But the banks’ problems also extend beyond those associated with homeowners. BofA, for instance, has been caught selling the same mortgage to multiple investors. As David Dayen put it, “the banks would knowingly put garbage into the mortgage pools and trot it out to the investors while misrepresenting the product. Now, we’re learning, there was a whole new angle – some of the loans showed up in multiple pools.”

This mess, which is entirely of the banks’ own making, extends far beyond some misspellings and empty lines on a form. The entire foundation on which the banks built their foreclosure machines encouraged fraud and speed, without regard for the rights of borrowers. And BofA appears to have learned no lessons, considering that it flew through verifications of its frozen foreclosures at breakneck speed — reviewing about 10,000 per day — after spending months dragging its feet when getting borrowers into sustainable loan modifications.

Education

REPORT: 49 GOP Congressional Candidates Join Ginni Thomas-Led Assault On Education

By Ian Millhiser on Oct 25, 2010 at 2:25 pm

Senate candidates Ken Buck (R-CO) and Sharron Angle (R-NV) have both received significant attention for their absurd claim the federal Department of Education is unconstitutional, but because House races generally receive much less media attention than the higher-profile Senate contests, it’s unclear just how common this radical position is among the GOP’s full slate of candidates.

A questionnaire circulated by Liberty Central, the right-wing group led by Supreme Court spouse Ginni Thomas, sheds a great deal of light on this question — and the answer is not pretty. Of the 60 candidate questionnaires submitted by current GOP nominees for a House or Senate seat that ThinkProgress reviewed for this report, at least 49 expressly adopt a view that would declare much — if not all — of federal education policy unconstitutional.

The Liberty Central questionnaire includes the following question:

The overwhelming majority of GOP candidates who submitted this questionnaire answered “no” to this question, a position that would drastically limit the federal government’s ability to help struggling schools, and which could also threaten Medicaid and other essential programs. Several of these candidates offered ahistorical, ideological and occasionally paranoid constitutional theories:

  • Robyn Hamlin (R-MO) explicitly calls for most of the Twentieth Century to be repealed, expressly listing “Aid to Dependent Children, Medicare, Medicaid, Social Security, Food Stamps, unemployment compensation; federally subsidized housing or any of the other federal ‘Welfare’ projects” as constitutionally invalid.
  • Joel Demos (R-MN) touts the “tenther” line that “[t]he original purpose of the ‘general welfare’ clause of Article I, Section 8 of the Constitution was to connect Congress’s taxing and spending authority to already enumerated powers – such as regulating interstate commerce or building and sustaining a military.” This false view of the Constitution, which was rejected by President George Washington in the earliest days of the republic, would also lead to Medicare, Social Security, Medicaid, unemployment insurance and countless other programs being declared unconstitutional.
  • Merlin Froyd (R-CA) also sounds a dog whistle to the most extreme tenthers, railing against federal spending on subjects that aren’t “actually written in the Constitution.”
  • Liz Carter (R-GA) calls for the federal government to “get OUT of education” altogether. That means no federal student loan assistance or Pell Grants for middle class students struggling to pay for college, and no education funds providing opportunities to students desperately trying to break into the middle class.
  • Dan Sebring (R-WI) offers his own unique theory about what the Constitution allows, claiming that the “general welfare” is limited to programs that “promote personal responsiblity and enhance one’s ability to take care of one’s self.” Needless to say, Sebring does not point to a single word in the Constitution suggesting that this limit exists.
  • Mariannette Miller-Meeks (R-IA) also invents a new constitutional theory out of whole cloth, claiming that general welfare does not include “social or collective welfare as currently utilized.”
  • Bill Huizenga (R-MI) serves up a Glenn Beck-like rant, blaming nineteenth and twentieth century “Hegelian Progressives” who “successfully undermined the American Constitution using an organic interpretation of the document.”
  • Eddie Zamora (R-TX) rails against an elusive enemy who acts “with no Fear of The LORD.”

To be fair, a handful of the candidates who answered “no” to Liberty Central’s question also indicate that their constitutional objections are limited in scope. Rep. Donald Manzullo (R-IL), for example, objects to No Child Left Behind, but also indicates that he would allow some federal education funding. Nevertheless, the candidates who embrace Ginni Thomas’ constitutional views would impose drastic new limits on the Department of Education and programs such as Medicaid.

The “General Welfare Clause” of the Constitution, also known as the “Spending Clause,” enables Congress to “provide for the . . . general welfare of the United States” by spending tax revenue on beneficial programs. Broadly speaking, this empowers Congress in two ways. Congress may spend directly to benefit the general welfare, as it does with programs like Medicare or Social Security, but it can also offer grants to the states which require the state to accept certain conditions if they take the money. Thus, for example, Congress requires states that accept federal Medicaid funding to actually spend that money on health care for the poor, and if a state doesn’t want to comply with this condition they can turn down the funds.

It’s not clear from Liberty Central’s question whether they object to all federal spending on matters that they view as “traditionally under the authority of the private sector, state, and local government,” or whether they merely object to laws that offer conditional grants to states. Yet, even if the candidates who answered “no” to this question only object to conditional grant programs, their position would make essential programs like Medicare and Title I education funds difficult or impossible to administer.

In other words, just like the many GOP Senate candidates who believe that the Constitution means whatever they want it to mean, much of the Republican slate of House candidates have no compunctions about inventing new and incoherent ways of reading the document in order to undermine laws they don’t like.

Center for American Progress Action Fund Intern Salvatore Colleluori contributed valuable research assistance to this report. A full list of the 49 candidates adopting Liberty Central’s position is below the jump.

Read more

Politics

European Polluters Funding Senate Candidates Who Oppose Action On Global Warming

By George Zornick on Oct 25, 2010 at 1:25 pm

As the Wonk Room has extensively documented, nearly all of the Republican candidates for Senate — both incumbents and challengers — dispute that the United States must take action to fight global warming pollution, while many of them deny that global warming exists in the first place. “There is much debate in the scientific community as to the precise sources of global warming,” claims Pat Toomey, the GOP Senate candidate in Pennsylvania. “Global warming is ‘the greatest hoax ever perpetrated on the American people,’” says Sen. Jim Inhofe (R-OK).

It remains to be seen if that stance will pay off at the polls, but for many of these global warming deniers, it already has paid off in the form of sizeable donations from overseas polluters. A new analysis by Climate Action Network Europe has found that large European companies that are among the continent’s biggest greenhouse gas polluters have been dumping large amounts of money into U.S. Senate races, almost exclusively to candidates that oppose the idea of taking action to stop global warming.

ThinkProgress has already documented how money from foreign oil companies is being directed to the U.S. Chamber of Commerce, which is running a $75 million ad campaign against Democratic candidates, and these direct candidate contributions from European polluters exceed the amount that oil billionaires Charles and David Koch have donated to Senate campaigns.

Through U.S. subsidiaries and employees, large European polluters like BP, BASF, Bayer and Solvay have donated $240,200 to candidates who have either voiced opposition to addressing global warming, or who have actively blocked legislation that would do so. For example, Bayer — which emitted 2 million metric tons of CO2 in Europe last year — gave almost 73 percent of its donations to such candidates, like the $5,000 it gave to Sen. Jim DeMint (R-SC), who opposes the EPA finding that greenhouse gases are pollution and opposes a cap-and-trade market to limit global warming pollution. The donations largely favored Republicans, but — demonstrating that stopping progress on addressing global warming was the key goal of these companies — select Democrats were given donations as well. Bayer gave even more money to Sen. Blanche Lincoln (D-AR), who has been a key swing vote in the Senate and also opposes EPA action on global warming pollution.

Many of these companies are involved in the debate over controlling global warming in Europe, and perversely, often cite inaction in the United States as a reason that serious efforts shouldn’t be made in Europe. Most of these companies are members of Business Europe, an influential trade group that recently release a position paper saying the group was “convinced that at this point in time, i.e. in the absence of an international deal securing equally strong action from other economies, any further increase of the EU’s unilateral 20% emission reduction target would be premature and even counterproductive.”

The strategy for these companies is clear: stop progress on global warming in the United States by supporting these candidates, and then blame that inaction when arguing that nothing should be done in the rest of the world to address global warming.

Financial Services Ranking Member Begs Banks To Donate To GOP Because Of Financial Reform

By Pat Garofalo on Oct 25, 2010 at 11:00 am

Rep. Spencer Bachus (R-AL)

There have already been significant rumblings from Republicans on the House Financial Services Committee about revisiting the Dodd-Frank financial regulatory reform bill should control of the House switch in November. Particular ire has been reserved for the new Consumer Financial Protection Bureau, which House Republicans have threatened to defund before it even gets off the ground.

I’ve already noted how the GOP’s zeal for repeal has led to an influx of money from the financial services industry. And according to Politico, Rep. Spencer Bachus (R-AL), who is slated to take over the House Financial Service Committee should Republicans gain a majority, told a crowd of 100 financial services lobbyists that they should be donating to Republicans, since Dodd-Frank “hammered them”:

When Republican Rep. Spencer Bachus of Alabama stepped in front of 100 financial services lobbyists at the Capitol Hill Club last month, he asked for an equal chunk of their campaign cash — and made clear he was watching closely. It is hard to believe, he told the crowd, that some in their industry were still giving more to Democrats than Republicans after, he said, Democrats hammered them with over-reaching Wall Street reform legislation, people familiar with the presentation said. Bachus told the group, for instance, that the Independent Community Bankers of America had given 68 percent of its contributions to Democrats, according to a lobbyist who was present.

And evidently Bachus’ spiel worked, as Independent Community Bankers of America Executive Vice President Steve Verdier said that “his group has started giving more heavily to Republicans and will end up giving 55 percent of its money to Democrats, down from the nearly 70 percent mark.”

But even if the ICBA — whose members are likely going to profit from Dodd-Frank, as their bigger competitors have a host of new restrictions placed upon them — gives a majority of its money to Democrats, that will be the exception in this cycle. According to the Center for Responsive Politics, “Republican candidates received 34 million dollars in donations from the finance, insurance and real estate sector since January compared to 23 million dollars given to Democrats.”

And when it comes to America’s “too big to fail” banks, donations are all skewing towards the Republicans. Bank of America, JP Morgan Chase, Wells Fargo and Goldman Sachs are all giving a majority of their donations this cycle to the GOP. The Financial Services Roundtable — which represents the country’s biggest financial firms — “has given the GOP $212,000 this round compared with almost $179,000 to Democrats.”

Of course, these kinds of overtures to financial services lobbyists are nothing new for House Republicans. After all, House Minority Leader John Boehner (R-OH) assembled a host of bank lobbyists back in December to develop a strategy for killing financial reform.

Switch to Mobile
ThinkProgress Signup Overlay Skip and Continue to ThinkProgress Skip and Continue to ThinkProgress

Sign Up