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Economy

Second GOP Governor Doubts Validity Of Romney’s Welfare Attacks

Gov. John Kasich (R-OH) and Mitt Romney

Several weeks ago, the Romney campaign launched dishonest series of attacks claiming that the Obama administration has “gutted” welfare reform by removing welfare’s work requirements. Early on Wednesday, Gov. Sam Brownback (R-KS) admitted that the attacks have no basis in reality, a fact already well explained by major media outlets.

“You agree that these claims that the work requirement has been abolished are false?” asked MSNBC’s Chris Jansing. “As far as I have seen,” Brownback replied.

Ohio Gov. John Kasich (R), however, declined to take the same step. Initially, Kasich said that the work requirement had been “eroded.” But after MSNBC’s Chris Matthews played the clip of Brownback’s answer and asked Kasich if he could say the same, Kasich replied that he hasn’t had time to examine the issue. However, he did say that he refused to sign onto a letter that the Romney campaign has been circulating on the welfare issue:

MATTHEWS: Can you give that same answer from what you have seen? They haven’t removed the welfare requirement — work requirement yet? They haven’t done it yet? You say eroded. I don’t know what that means. Is it gone or is it still in place? Can you get welfare without working?

KASICH: I don’t know the answer to that, Chris. In fact, I was asked to sign a letter as I was going out the door to head down to this convention before I had a chance to study the whole issue. I said, look, I’m going to pass on this letter until I understand the whole issue.

Watch it:

Kasich is the governor of a major state, and the Romney campaign has been using this attack for weeks, yet he claims he hasn’t had any time to look into it. But that didn’t stop him from presuming that the claims are true. Campaign officials, meanwhile, have simply laughed off questions about the false ads, while campaign pollster Neil Newhouse told BuzzFeed’s Ben Smith, “We’re not going to let our campaign be dictated by fact-checkers.”

Bank Of America Has Provided No Mortgage Principal Relief Under The Foreclosure Fraud Settlement

The nation’s five biggest banks agreed to a $25 billion foreclosure fraud settlement back in February that required them to provide $17 billion of mortgage relief to troubled homeowners. However, one of the banks, Bank of America, is hardly holding up its end of the bargain. According to a new report, as of June 30, Bank of America had not modified a single mortgage under the settlement to reduce the amount that a borrower owes:

Bank of America Corp is lagging other banks in quickly executing mortgage modifications required by the U.S. government as part of the $25 billion foreclosure settlement finalized in March, according to a report released on Wednesday…Unlike its competitors, Bank of America did not finalize any modifications of first-lien mortgages and also did not complete any refinances by June 30.

Bank of America admitted earlier this month that it was lagging behind on loan modifications, but this report shows just how incompetent the bank has been when it comes to moving homeowners into more sustainable mortgages. Bank of America does lead the settlement banks affected in getting its borrowers through short sales, but as Firedoglake’s David Dayen explained, “the idea of banks granting short sales as a punishment for defrauding consumers and state courts is ridiculous. They’re all too happy to get a higher price for a short sale than they would get in foreclosure, with the added benefit of never having to take the foreclosed home and maintain it.”

Prior to the settlement, one whistleblower alleged that Bank of America intentionally blocked homeowners from receiving federal mortgage aid. But perhaps all these homeowners simply weren’t willing to erase the mean things they said about Bank of America on Twitter.

FACT CHECK: Yes, Romney’s Tax Plan Requires A Middle-Class Tax Increase

Our guest blogger is Seth Hanlon, Director of Fiscal Reform at the Center for American Progress Action Fund.

A recent study by the nonpartisan Tax Policy Center found that Mitt Romney’s tax plan, which purports to be “revenue neutral,” would require households with incomes under $200,000 to pay higher taxes, on average, in order to finance tax cuts for the rich. In response, Romney economic advisor Martin Feldstein penned an op-ed in today’s Wall Street Journal claiming that Romney’s plan does not require such a tax increase.

Though Feldstein uses at least three sleights of hand to obscure the point, his analysis actually confirms TPC’s central finding. Here’s why:

1) Feldstein ignores Romney’s $1 trillion corporate tax cut, which is paid for by individual income tax increases.

Feldstein purports to show how reductions in tax breaks for high-income households could pay for a handful of Romney’s tax policies, including cuts in tax rates for individuals. But Feldstein conveniently ignores Romney’s tax cuts for corporations.

Romney’s plan would give corporations an “immediate” tax cut, cutting their rates from 35 percent to 25 percent. This tax cut would cost $96 billion in 2015 according to the Tax Policy Center (TPC) and more than $1 trillion over ten years. The TPC report did not even factor this massive corporate tax cut in their analysis of Romney’s plan under the very generous assumption that it would be fully paid for by eliminating business tax breaks.

But the Romney campaign has since made clear that the $1 trillion in corporate tax cuts aren’t paid for by any reductions in corporate tax breaks. Therefore, as the TPC researchers have noted, Romney’s corporate tax cuts would require “even larger cuts to tax expenditures [i.e. tax breaks], and correspondingly larger increases in taxes on middle- and/or lower-income taxpayers,” than their original study found. Feldstein simply ignores all of this.

2) Feldstein redefines the “middle class.”

In crunching numbers to try to make Romney’s tax plan add up, Feldstein counts only those households with incomes under $100,000 as “middle class.” He purports to demonstrate that Romney’s plan can add up if deductions are eliminated for households over $100,000. But this simply confirms the Tax Policy Center’s conclusion that Romney’s plan does not add up without a tax increase on households with incomes under $200,000. (This table from TPC shows that households in the $100,000-$200,000 range stand to lose much more from the elimination of tax breaks than they would gain from Romney’s tax rate cut.)

Read more

Election

Romney Adviser Admits GOP Budget ‘Probably Doesn’t’ Have Support In ‘Most Places’

Former Florida Senator and RNC Chairman Mel Martinez (R)

Mitt Romney has thrown his full support behind Rep Paul Ryan (R-WI) budget and his campaign has repeatedly insisted that the former Massachusetts governor would have signed it into law.

But now, some of Romney’s key advisers are expressing skepticism about how the document — and it’s conservative ideology — will play in local races. In an interview with ThinkProgress, Mel Martinez — Romney’s top Hispanic Steering Committee adviser and a former senator — argued that many voters will reject Ryan’s economic policies:

SCOTT KEYES: Do you think [Ryan's] budget will play a positive role in the campaign for Republicans? You’re former RNC chair, is that something you would recommend to, say Republican house candidates, to run on the Ryan budget and Medicare?

MARTINEZ: You know what, I think house races have their own chemistry. I would not attempt to nationalize a house race. I think you have to do that district by district, maybe in some places it makes sense to nationalize it, most places it probably doesn’t. I would say, it’s not really about the congressional races, I think it’s about the presidential when it comes to that.

Watch it:

Perhaps Martinez is right to dissuade Republicans from running on the Ryan budget. The last time a Republican campaigned on a promise to support and vote for the Ryan budget — a 2011 special election in New York — Republican Jane Corwin lost handily to Democrat Kathy Hochul in one of the most reliably conservative districts in the country despite outspending Hochul by a 2-1 margin. Since 1857, just three Republicans had ever lost congressional races in the district.

NEWS FLASH

Declining Unionization Caused One-Third Of Increase In Wage Inequality During Last 40 Years | Nearly one-third of the increase in wage inequality among men over the last four decades is attributable to the declining unionization of the American workforce, a new study from the Economic Policy Institute found. Declining unionization is responsible for roughly one-fifth of the growth in wage inequality among women over the same time period (from 1973 to 2007), according to the report. In 1973, 26.7 percent of American workers were in a union; by 2011, that number had fallen to 13.1 percent. The study also found that declining unionization was responsible for 76 percent of the increase in wage inequality between white- and blue-collar workers.

Education

Republicans Debate How Much To Cut Education While China And India Invest More

Our guest blogger is Kate Pennington, an education policy analyst at the Center for American Progress Action Fund.

Republicans have been internally debating just how much to cut federal spending on education, but their platform unveiled this week at their convention in Tampa Bay does little to clarify their vision beyond referencing that no new investments will be made. While the Romney campaign works out the details of the education funding conundrum (or simply figures out the PR spin), Tea Party conservatives are loudly voicing their opinions to end federal spending on education entirely.

With the GOP convention taking place down the street, conservative talk show shock jock, Neal Boortz, remarked that the U.S. does not have public schools but rather, “government schools”. “It is 100 years of government education,” Boortz commented, “that led us to the point that a man like Barack Obama could be sworn in as President of the United States.” Other speakers at the rally, including Reps. Jason Chaffetz and Michele Bachmann, did not denounce Boortz for his comments or take a stand for U.S. public education.

The Republican party has clearly taken an ideological turn regarding the federal role in education over the past decade. After all, it was George W. Bush who championed No Child Left Behind and increased education spending to secure its passage in 2002. This change is particularly detrimental when investment in education seems to be the ticket to success for several other countries.

A new report shows that other nations like China and India have out-invested the U.S. in their education systems as strategies to become more competitive internationally. While U.S. 15-year-old students rank 14th in reading, 17th in science and 25th in math, governments in China and India have expanded to make major investments in early childhood learning, expanded primary and secondary school public education systems, and post-secondary degree programs that produce career-ready workers.

Read more

NEWS FLASH

Mortgage Company Settles Discriminatory Loan Charges For $3.5 Million | A mortgage company that was charged with overpricing loans for nonwhite borrowers will pay $3.5 million to the 600 African American and Latino borrowers who paid higher mortgage rates than whites from 2005 to 2009, the New York Times reports. GFI Mortgage Partners will also pay a $55,000 fine, the maximum allowed under the Fair Housing Act. GFI admitted in a statement that federal investigators found that it overcharged minority borrowers, a problem that isn’t isolated to one company: blacks and Latinos were twice as likely as whites to be affected by the housing crisis, as lenders often pushed them into subprime loans and overcharged them on their mortgages.

GOP Governor Acknowledges That Romney’s Welfare Attack Ads Are False

Gov. Sam Brownback (R-KS)

The Romney campaign has been running a series of blatantly false ads claiming that the Obama administration has waived work requirements included in the 1996 welfare reform law. Everyone from independent fact-checkers to major newspapers to President Bill Clinton (who signed the law) have said that the campaign’s attack is untrue.

Last night, however, failed presidential candidate Rick Santorum once again made the false claim, saying “this summer [Obama] showed us once again he believes in government handouts and dependency by waving the work requirement for welfare.” But evidently not every member of the Republican party received the memo about how to characterize what the administration did. When asked Wednesday morning whether the welfare claim is a lie, Gov. Sam Brownback (R-KS) replied, “as far as I have seen”:

JANSING: But you agree that these claims that the work requirement has been abolished are false?

BROWNBACK: As far as I have seen, but I don’t know all of the basis to it. I do know the basis to this dependency on the government and how big the government is and how big the entitlement state is and how much of a debt we’re leaving to our kids.

Watch it:

All the administration’s welfare waivers would do is empower states to innovate with new work strategies. The directive from the administration reads, “The Secretary [of Health and Human Services] is only interested in approving waivers if the state can explain in a compelling fashion why the proposed approach may be a more efficient or effective means to promote employment entry.”

Yesterday, the Romney campaign’s political director laughed off a question about the false welfare ads, saying, “I think reasonable people can have a disagreement over this.”

Education

GOP Platform Lies About Abstinence Education’s Effectiveness

The official Republican platform — which one GOP official referred to as “the most conservative platform in modern history” — advocates for a far-right approach to women’s health, including a sweeping abortion ban without any exception for rape or incest. And it doesn’t stop there.

In addition to the platform’s stringent anti-abortion stance, it also enshrines a misguided approach to sex education that will actually lead to more unplanned pregnancies:

We renew our call for replacing “family planning” programs for teens with abstinence education which teaches abstinence until marriage as the responsible and respected standard of behavior. Abstinence from sexual activity is the only protection that is 100 percent effective against out-of-wedlock pregnancies and sexually-transmitted diseases including HIV/AIDS when transmitted sexually. It is effective, science-based, and empowers teens to achieve optimal health outcomes and avoid risks of sexual activity. We oppose school-based clinics that provide referrals, counseling, and related services for abortion and contraception.

Touting abstinence-only education programs as “effective” and “science-based” is simply not true. In fact, abstinence education curricula often lack very basic facts about contraception, pregnancy, sexual assault, and effective barriers against sexually transmitted diseases. Some abstinence-only courses, such as the health class in California that instructs students to prevent STDs with “plenty of rest,” teach blatant misinformation.

Thanks to the lack of scientific facts in abstinence-only courses, a full 60 percent of young adults underestimate birth control’s effectiveness and are more likely to skip it because they don’t believe it will make a difference. It is no surprise, then, that the states that push abstinence-only policies have the highest rates of teen pregnancy.

Abstinence-only education is based on the specious theory that teenagers shouldn’t be taught anything about sex because they shouldn’t be having sex. But promoting abstinence hasn’t worked in religious communities — a full 80 percent of evangelicals report having sex at least once before marriage — and won’t work in schools, either. The approach fails to take into account the fact that 70 percent of teenagers are sexually active by the time they turn 19, and sitting in a health class that pushes junk science won’t dissuade them otherwise. To achieve the goals the Republican Party puts forth, schools across the country need to implement comprehensive sex education that will have honest conversations with young adults about sexuality.

Econ 101: August 29, 2012

Welcome to ThinkProgress Economy’s morning link roundup. This is what we’re reading. Have you seen any interesting news? Let us know in the comments section. You can also follow ThinkProgress Economy on Twitter.

  • Occupy Wall Street protesters plan to mark the movement’s first anniversary with a with a protest at the New York Stock Exchange. [Bloomberg]
  • More U.S. corporations are reincorporating abroad in order to avoid taxes. [Wall Street Journal]
  • Central bankers from around the world will meet in Jackson Hole, Wyoming, this week, but won’t be joined by European Central Bank chief Mario Draghi. [Financial Times]
  • Banks are pushing for wider exemptions to the Volcker Rule, which is meant to prevent risky trading with federally backed dollars. [Reuters]
  • The latest S&P/Case-Shiller index showed that home prices rose on an annual basis for the first time in two years. [Washington Post]
  • Consumer confidence numbers took an unexpected dip last month. [The Hill]
  • Despite the drought gripping the U.S., American farmers are on pace for their most profitable year ever. [Financial Times]

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