Why I left the Democratic Party

Reply Fri 10 Nov, 2017 01:42 pm
The Virginia results suggest they're going to do quite well without Mr. Sanders. His refusal to back the Dem candidate for governor was a definite statement. Don't pick his chosen candidate? he's not going to help anyone else.

It's funny in a way. There is a suggestion that the Republican lost because he wasn't enough like Trump. At the same time, the Democrat won without Sanders support.

Some shaking up going on.

The demographic shift is having an impact.



Good thing.

Listened to an interview with Wilmot Collins the other night. Definitely made me feel better about America.
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Reply Fri 10 Nov, 2017 01:53 pm
ehBeth wrote:
now here's a weird thing

American medication costs are often less than they are in Canada unless they're provided by a hospital or clinic. Then the mark-ups go to crazyville.

I don't know Canadian prices. Here's an interesting study but they don't cite the countries other than the US:

The U.S. Pays a Lot More for Top Drugs Than Other Countries
By Robert Langreth , Blacki Migliozzi& Ketaki Gokhale, Bloomberg, December 18, 2015

Prices for brand-name drugs are typically higher in the U.S. than other developed countries. The drug industry has argued it's misleading to focus on U.S. list prices that exclude discounts struck behind closed doors with insurers.

A Bloomberg News analysis finds that even after these discounts, prices are higher in the U.S. than abroad.

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Reply Fri 10 Nov, 2017 02:34 pm
Olivier5 wrote:

I think that would be unfair. I read them as 'regular' democrats, who were once very committed to the cause but have evolved in life. You know, the classic trajectory of reform-minded people who begin to make serious money in their 40's or thereabout, and then begin to reassess their youthful idealism. When you earn a 6 digit income, pro-poor policies start to lose their appeal, somehow, and successful social climbers often find that discussing with people a little less successful than themselves becomes quite exasperating... :-)

Excuse me, I'm the oldest child of 6 children, 3 of whom make around 30k per year and I send them at least 5-10k per year (depends on the year) to help them make ends meet. If you think I don't care about the poorer among us, then you couldn't be more wrong.
Reply Fri 10 Nov, 2017 02:39 pm
He refers to helping family as donating to the poor.

That speaks volumes.

I think Mitch McConnell has more EQ than that...
Reply Fri 10 Nov, 2017 03:03 pm
1) not what I said
2) what exactly does helping my family say about me?
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Reply Fri 10 Nov, 2017 07:13 pm
maporsche wrote:

Excuse me, I'm the oldest child of 6 children, 3 of whom make around 30k per year and I send them at least 5-10k per year (depends on the year) to help them make ends meet. If you think I don't care about the poorer among us, then you couldn't be more wrong.

Most people I know don’t equate family with “the poorer among us.”
Most people I know routinely share their good fortune with family, and wouldn’t talk about that in a conversation about the poor.

That’s just my experience.
Reply Fri 10 Nov, 2017 07:34 pm
The Trump backlash may elect Democrats of just any stripe, but that doesn't solve the problem of corporate oligarchy and the like. It just kicks the can down the road at a time when there is not much leeway to rescue democracy.
Reply Fri 10 Nov, 2017 07:38 pm
People who think I am just fighting for Bernie and purity tests for the Democratic party misread the whole intent of fighting for change. I don't want to be sitting in a Russian style of 'democracy' to be saying "I told you so."
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Reply Sat 11 Nov, 2017 12:20 am
Well, they are poor. WTF is wrong with that? It doesn't make them bad people or anything. They will literally tell you they are poor. They're not ashamed; 2 of them actively got masters degrees in college and a passion for social work and they work with homeless teenagers. Those jobs just don't pay a lot of money. I wish they paid 100k/yr but they just don't. I couldn't do the jobs that they do.

My point in bringing it up is in rebuttal to the "maporshe is out of touch because he now has a good income." I'm not out of touch. I see what those who are less financially well off have to navigate through ALL the time. I'm helping my family navigate through it almost weekly.

That's my experience.

I thought you were sick of all the people who couch what they say in nice language? Aren't we just supposed to call a spade a spade now?
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Reply Sat 11 Nov, 2017 12:22 am
In the meantime maybe these democrats can work to get guns out the hands of people who shouldn't have them...you know, progressing. Getting stuff done.
Reply Sat 11 Nov, 2017 01:12 am
In other somewhat joyous news, locally, just north of here, up in Westchester County (New York), 2 term Republican Rob Astorino lost in his bid for a third term to Democrat George Latimer.

For timeline interests, it should be noted that Astorino had defeated 3 term Democrat Andy Spano for the same position back in 2009, winning by several percentage points.

Another sign that maybe, just maybe, things are shifting.
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Real Music
Reply Sun 12 Nov, 2017 08:58 pm
DNC Chief Vows To Make Dem Primaries Fair In 2020

Tom Perez, the chairman of the Democratic National Committee (DNC), is pledging to make the party's primary process fairer and more transparent in the wake of the deeply divisive 2016 nominating contest between Hillary Clinton

In an interview with radio host John Catsimatidis, Perez acknowledged that last year's Democratic primaries left many voters skeptical of the party's intentions, and vowed to make up for that in future contests.

"It's clear to me that the DNC has to do a better job of ensuring that the Democratic primary process is fair to everybody," said Perez, who took over the DNC earlier this year as the party sought to regroup from Clinton's 2016 election loss.

"And by everybody I mean not just the candidates, but the voters feel like the party is transparent and the party is giving an opportunity to everyone and the party is making sure that everybody who is able to vote can get out there."

"I know that we have to do a better job as the Democratic Party in making sure that the process is fair," he added.

One of the steps he said the DNC would take to assure voters that the primary process is fair is to set the party's debate schedule before all the candidates have announced their bids, as previously reported by The Hill.

"Last time around there was a very strong sense that the primary debate schedule was set up in a way as to help one candidate over another," he said. "And we're not going to have that happen."

Perez also said that the party's success in future races will depend on its ability to build its own infrastructure. That includes its use of technology and organizing efforts. Last year, he said, the DNC had allowed its "basic infrastructure to degrade."

Perez's comments come days after Democratic candidates swept state and local elections across Virginia, New Jersey and New York, among other states. The wins, widely seen as a reaction to President Trump's deep unpopularity, have been touted by the Democratic Party as a bellwether of success in the 2018 midterm elections.

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Reply Tue 14 Nov, 2017 05:17 pm
It's all about the increments.
A little over a year ago, Sen. Mark Warner (D-Va.) addressed a small audience of political insiders at the Brookings Institution, one of the most prestigious think tanks in the nation’s capital. Times were changing, Warner told the crowd, and the old guard from Washington and Wall Street wasn’t keeping up with the needs of the modern workforce. The gig economy, outsourcing and automation had created an era of unprecedented “income volatility” for Americans. New financial technology firms had “an opportunity to bridge part of that new social contract,” to “lean forward and meet workers where they’re working.”

It had been a long day for the Virginia Democrat. A dental appointment had unexpectedly turned into a three-hour ordeal, and he’d arrived at the conference a little “cotton-mouthed,” as he put it. When he veered into a discussion about “a much more aggressive way to upscale people” through “an enormous number of intersection points,” including “your relationship with that FinTech provider,” it wasn’t obvious exactly what Warner was after.

But the big picture was clear enough. The government needed to “encourage innovation.” Entrepreneurs had to be thinking about a “portable benefits system,” about emergency funding to help people meet unexpected expenses. It was time to get past the same old debates about government and regulation. This was about change. It was about progress. Warner had seen the future.

A year later, that tomorrow has arrived. And the grand financial technology breakthrough, it turns out, is to help payday lenders sidestep basic consumer protection laws.

In late July, Warner introduced the ingeniously titled “Protecting Consumers’ Access to Credit Act of 2017.” The legislation would allow payday lenders to ignore state interest rate caps on consumer loans as long as they partnered with a national bank.

Although it has been generally overlooked amid the GOP’s stumbling attempt to repeal Obamacare and its aggressive plan to slash taxes for Wall Street, Warner’s little bill has a much better chance of making it into law than the Republican Party’s marquee efforts. Companion legislation is scheduled for a vote in the House Financial Services Committee on Tuesday, where the bill has the backing of archconservative Rep. Patrick McHenry (R-N.C.) and Reps. Greg Meeks (D-N.Y.) and Gwen Moore (D-Wis.), liberal Democrats with a history of sympathy for the financial industry. Warner’s Senate version is co-sponsored by tea party darling Sen. Pat Toomey (R-Pa.) and Sen. Gary Peters (D-Mich.).

Warner’s bill has drawn opposition from consumer groups including Americans for Financial Reform, the Center for Responsible Lending and the Consumer Federation of America, along with civil rights organizations including the NAACP and the Southern Poverty Law Center.

In September, the groups wrote a joint letter to every member of Congress urging them to oppose the legislation, saying it “wipes away the strongest available tool against predatory lending practices” and will “open the floodgates to a wide range of predatory actors to make loans at 300% annual interest or higher.”

Dozens of states regulate payday lending through usury caps ― blocking loans with annual interest rates higher than a certain amount, often 36 percent. Payday loans usually take the form of a two-week advance of a few hundred dollars with a “fee” of a few dozen dollars. In 2013, the Pew Charitable Trusts found that a typical payday loan was about $375, with a $55 fee. Since the life of the loan is so short, in just two weeks this “fee” works out to an annual interest rate of over 380 percent. In practice, though, it’s usually much worse than that, since, according to Pew, a typical customer ends up repeatedly rolling over a payday loan, ultimately handing over about $520 in fees to pay off an initial $375 advance.

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The Consumer Financial Protection Bureau has since approved standards curbing some of the worst abuses in the market, but many states remain justifiably concerned about this type of activity. Interest rate caps are a powerful tool applying to essentially all credit, not just payday loans. But national banks have a great deal of flexibility with these standards thanks to a court decision from the 1970s. They have to comply with the interest rate caps only in their home state ― not those of the state where the person receiving a loan lives. So payday lenders and other predatory operations sometimes ask banks in loosely regulated states to issue loans on their behalf. The payday lender quickly buys the loan after it is issued by the bank, allowing the bank to earn a commission for its service as a regulatory frontman. In 2015, a federal court prohibited this end-run around state laws in a few states. Warner’s bill would essentially overturn the court decision and protect cross-state rent-a-bank schemes nationwide.

A Warner spokesperson defended the bill with a torrent of legalese. “The Second Circuit in Madden v. Midland upset well over a century of established practice when it limited national banks’ ability to sell loans to purchasers in other states. President Obama’s Solicitor General told the Supreme Court that he thought that the decision was ‘incorrect,’ and we’ve since seen evidence from accomplished academics that the decision has reduced access to credit for borrowers with lower credit scores. The Protecting Consumers’ Access to Credit Act would restore long-standing legal precedent and encourage access to credit for low- and middle-income Americans, while preserving longstanding, existing rules that protect consumers from abusive payday lending. Moreover, national banks will still be required to abide by existing usury laws in their home states.”

Silicon Valley has been toying with the high-interest consumer loan market for a few years. LendingClub, Prosper, LendUp and other FinTech companies have been billing themselves as hip, savvy alternatives to payday loans or pricey credit cards. They typically partner with a bank to avoid regulatory costs, and they are just as eager to bypass state usury laws as are their more notorious competitors. LendingClub, in particular, insists it will not be able to help people lower their credit card bills if it has to abide by state usury caps (banks that issue credit cards are mostly exempt from those laws, after all).

But some of these firms aren’t much better than the garden-variety predatory lender over by the 7-Eleven. Last year the Consumer Financial Protection Bureau fined San Francisco-based LendUp for ripping off more than 50,000 customers.

In a statement provided to HuffPost, Meeks argued that the bill would actually prevent people from turning to online payday lenders. Which is true, since technically they’d be getting their payday loan from the bank.

“The bill would allow a third party to enforce the legal interest rate established between a bank and its customers ― it is not a backdoor for unscrupulous players as some suggest,” Meeks argued in a statement provided to HuffPost. “Without access to these bank loans, consumers in New York will be pushed to higher cost alternative service providers including pawnshops, rent-to-own arrangements, and online payday lenders.”

“We want to make sure that our constituents have adequate access to bank loans while helping the banking system defend itself from questionable products and services,” Moore spokesman Eric Harris told HuffPost.
Real Music
Reply Tue 14 Nov, 2017 10:41 pm
Thanks for sharing that article. It is very informative.

Some of these harmful laws could be passed under the radar when no one is looking.

Many of these lending deregulations are essentially legalizing lone sharks.

It looks like these predatory lenders are pushing harder and harder for more deregulations.

The republicans are definitely big supporters of these predatory lending practices.

It's sad to say that there are even some democrats who support these predatory lending practices.

Thanks for the info.
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Reply Fri 24 Nov, 2017 01:06 pm
Increments at Work

Robert Reich
8 hrs ·
Who says bipartisanship is dead? Consider the agreement reached between 9 Senate Democrats and the top Republican on the Senate Banking Committee to roll back several key financial regulations, including sections of the Dodd-Frank Act.
1. Banks with less than $10 billion in assets would be allowed to sell high-risk mortgages without the disclosure and ability-to-pay rules in place across the industry.
2. They’d also be free from several reporting requirements, the Volcker rule restrictions on market trading with their own deposits, and numerous capital standards.
3. The bill raises the threshold for “systemically important financial institutions" from $50 billion to $250 billion in assets, thereby freeing dozens of banks from enhanced Federal Reserve supervision and larger capital requirements.
4. There’s also an exemption from mortgage rules for manufactured homes like trailers, the largest producer of which is Clayton Homes, a division of Warren Buffett’s conglomerate Berkshire Hathaway. Congress has already exempted auto dealers from many lending regulations.
5. Another measure would allow hedge funds to create investment vehicles that share a name with an affiliated bank. It’s a marketing effort to give funds credibility; the biggest advocate for the change was BlackRock, the largest asset manager in the world.
Consumer protections in the bill are relatively modest. With the scandals at Wells Fargo and Equifax, Congress doesn't need to do favors for banks in order to pass robust new consumer protections.
Four Banking Committee Democrats — Joe Donnelly, D-Ind., Heidi Heitkamp, D-N.D., Jon Tester, D-Mont., and Mark Warner, D-Va. — negotiated the bill with committee chair Mike Crapo, R-Idaho. Tim Kaine, last year’s vice presidential nominee, signed on as an original co-sponsor along with Joe Manchin D-W.Va., Claire McCaskill, D-Mo., Gary Peters D-Mich., and Angus King, I-Maine.
Why would Senate Democrats ever agree to this banking bonanza? Five of these senators face re-election next year and come from states won decisively by President Donald Trump. The rest either don’t know how bad the bill is or depend on campaign donations from Wall Street.
Nothing fosters more bipartisanship in Congress than following the wishes of the banking industry.
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Reply Wed 29 Nov, 2017 09:51 am
Russian Meddling Hysteria is Being Used to Delegitimize Anti-Establishment Voices
By Joshua Sager - November 22, 20170

If you have been following the news or spending any time on political social media, you have likely seen manifestations of neo-McCarthyism, or the use of any asserted connection to Russia to marginalize a political opponent. This trend is increasing in frequency and metastasizing throughout our political discourse, to the point where it is being used by both partisan sides of the political establishment to attack any social movement or media outlet that they disagree with.

The Intercept’s Glenn Greenwald’s brutal rebuke of Howard Dean’s use of this tactic…
While there is certainly a debate to be had over whether Russia has made attempts to meddle in our elections, this trend is toxic and promises to have terrifying consequences if not addressed.
RT America Under Fire
This coming Monday, the American branch of the Russian media channel RT (RT America), will have to register as a foreign agent, on pain of being shut down, having its assets frozen/seized, and having leadership personnel arrested. This decision is being driven by the accusations that RT America is being used to spread anti-American propaganda and the accusation that it was part of the Russian meddling in the 2016 election.
The findings of the intelligence community on RT were published in a summary report earlier this year, revealing a disturbing underlying logic for this targeting of RT. In this report by the Director of National Intelligence, they argue that RT is undermining our political system through its coverage of certain stories, all of which reflect badly on the US government, but none of which are factually wrong. In effect, they are arguing that RT is anti-American because they dare point out real problems in our society—here are some examples quoted in the report:
“From August to November 2012, RT ran numerous reports on alleged US election fraud and voting machine vulnerabilities, contending that US election results cannot be trusted and do not reflect the popular will.” – pg 6
“In an effort to highlight the alleged ‘lack of democracy’ in the United States, RT broadcast, hosted, and advertised third party candidate debates and ran reporting supportive of the political agenda of these candidates. The RT hosts asserted that the US two-party system does not represent the views of at least one-third of the population and is a ‘sham.’” – pg 6
“RT aired a documentary about the Occupy Wall Street movement on 1, 2, and 4 November. RT framed the movement as a fight against ‘the ruling class’ and described the current US political system as corrupt and dominated by corporations.” – pg 7
“RT’s reports often characterize the United States as a ‘surveillance state’ and allege widespread infringements of civil liberties, police brutality, and drone use.” – pg 7
“RT has also focused on criticism of the US economic system, US currency policy, alleged Wall Street greed, and the US national debt.” – pg 7
“RT runs anti-fracking programming, highlighting environmental issues and the impacts on public health.”
Arguing that RT America is engaging in anti-American propaganda because it is pointing out real flaws in our democratic system, identifying corruption and Wall Street excess, and warning Americans about the dangers of fracking, police abuses, and unchecked surveillance, is absurd—this is what any decent journalistic outlet should be doing.
If the government is allowed to label outlets that cover real issues in our society and government as “foreign agents” and decry them as anti-American propagandists, it sets a terrifying precedent where any coverage that doesn’t conform with those in power can be delegitimized. This delegitimization doesn’t end with RT however, as we have seen in recent months.
The “Buying into Russian Propaganda” Smear
In recent months, I have seen a disturbing trend of politicians and politically-engaged citizens dismissing any inconvenient facts you may point out as simply you parroting Russian propaganda. Instead of actually addressing your arguments, they point to poorly sourced articles in one of their preferred establishment media outlets which argue that Russian “trolls” spread misinformation on the subject that you are talking about and you are just parroting them.
There are many examples of this tactic being used by Hillary loyalists. For example, many Hillary supporters will use this argument if you point out how much money flowed to the Clinton Foundation and family from interests that have an interest in buying influence with the person they thought would be the next president of the USA. Similarly, even Donna Brazile is being accused of buying into “false Russia-fueled propaganda” when she admitted to worrying about Hillary’s health after Hillary passed out during a 9/11 memorial ceremony.  
This tactic is not only being utilized in defense of Clinton, but against major social movements in the USA.
Many outlets have reported that BLM was supposedly infiltrated by Russian trolls, who incited protests and stoked racial division in an attempt to destabilize the American society. Apparently, those buying into this narrative believe that African Americans need shadowy Russian influences to trick them into being angry when their neighbors and family members are murdered by police, who are then let off with paid leave. Additionally, implicit to this argument is the idea that putting more focus on police violence against people of color somehow destabilizes our society, which is simply wrong.
This same argument is being used ex post facto against Standing Rock protesters, with outlets declaring that some of the voices supporting the protests were secretly Russian trolls seeking to make the USA look bad and spotlight the poor treatment of Native Americans by our nation.
Even the GOP is starting to utilize this tactic, with pro-fracking Republicans on the House Science and Technology Committee investigating accusations that anti-fracking advertising on social media is traced back to Russia. This ignores the fact that, even if Russians are involved in pushing anti-fracking advertisements, the result of these ads succeeding would be fewer Americans dying or getting cancer due to the terrible impacts of fracking on animals living near fracking wells (the true “anti-American” position is to let corporations poison our nation).
You can see a pattern emerging in these cases. When a social movement challenges the status quo, the in vogue way to delegitimize it is to find a tenuous way to link it back to Russia so that people not interested in dealing with the social movement’s arguments can simply declare the social movement a Russian op.
Prop or Not?
The neo-McCarthyism I describe in this article is not only impacting RT America and insurgent social movements, but has been used to attack alternative media. With no evidence, some more mainstream media have declared that certain alternate media organizations are secretly Russian puppets looking to undermine the USA.
The most obvious such attack occurred earlier this year with the Prop or Not organization declaring dozens of alternative media sites (e.g. Truthdig, Truth-Out, Wikileaks, TheRebel.Media, InfoWars, etc.) to be Russian propaganda tools—accusations that many in the mainstream media (e.g. the Washington Post) ran as fact despite the fact that the list of outlets was provided without evidence from an organization with an anonymous members list. This isn’t to say that the media outlets named are all credible (in fact, some are insane blogs), merely that labeling them as Russian propaganda is completely unsupported and a false way of declaring them illegitimate.
These accusations are having a real impact. Google has been throttling the searches of numerous sites accused of being Russian-affiliates. For example, in October, Google throttled the World Socialist Website from its news search engine, reducing the number of referrals to the site by approximately 92% almost immediately. Similarly, Twitter administrators just admitted in Congressional testimony to censoring nearly half of the tweets with the hashtag #DNCLeaks or #PodestaEmails because they believed reports that those hashtags were based on Russian propaganda. This is particularly ridiculous because we now know that those emails were legitimate and showed clear bad acts by those in the DNC, including the rigging of the Democratic primary that even Donna Brazile (the ex-head of the DNC) now admits occurred.  
We cannot let neo-McCarthyism become a valid tool to delegitimize news outlets and social movements that challenge those in power. The mere accusation that somebody is somehow affiliated with Russia or saying something that a Russian online once agreed with cannot become a get out of argument free card for those who cannot address the issues that person is bringing up.  © Josh Sager – November 2017
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Reply Wed 6 Dec, 2017 06:34 am

U.S. Senator Elizabeth Warren was live.
16 hrs ·
A bunch of senators – including some Democrats – are trying to roll back the rules for big banks that sucked down nearly $50 billion in taxpayer-funded bailouts a few years ago. It’s insane. Today the Senate Banking Committee will be debating and revising this terrible #BankLobbyistsAct. Watch live as I fight for a dozen amendments to put the American people first.
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Reply Sun 10 Dec, 2017 12:42 pm
The Obama presidency was a disaster for middle-class wealth in the United States. Between 2007 and 2016, the average wealth of the bottom 99 percent dropped by $4,500. Over the same period, the average wealth of the top 1 percent rose by $4.9 million.
This drop hit the housing wealth of African Americans particularly hard. Outside of home equity, black wealth recovered its 2007 level by 2016. But average black home equity was still $16,700 lower.
Much of this decline, we will argue, can be laid at the feet of President Obama. His housing policies led directly to millions of families losing their homes. What’s more, Obama had the power — money, legislative tools, and legal leverage — to sharply ameliorate the foreclosure crisis.
He chose not to use it.

A Program Designed to Fail
After the 2008 collapse, the Wall Street banks that caused the crisis got spectacular sums in the form of the Trouble Asset Relief Package (TARP) and discount loans from the Federal Reserve. According to one estimate, they received a staggering $29 trillion in cash and loans.
For homeowners, the largest source of potential relief was, ironically, that same bank bailout, which contained an unspecified appropriation to “prevent avoidable foreclosures.” The Obama administration designed and implemented the foreclosure relief effort, calling it the Home Affordable Mortgage Program (HAMP), and set aside $75 billion for the effort.
But HAMP proved to be an abject failure. The basic problem was that the government paid mortgage servicers (who process the payments and paperwork for the mortgage owner) to conduct mortgage modifications. Servicers have an incentive to keep people paying on a high principal, since they receive a percentage of the outstanding debt. They even have an incentive to foreclose, because they are paid from the proceeds of a foreclosure sale before the actual owners.
Lax oversight from both the Treasury Department and the Department of Justice made things worse. Some servicers tricked people into foreclosure, according to several investigations and sworn testimony from Bank of America whistleblowers. And by repeatedly “losing” people’s paperwork or engaging in other tricks, the servicer squeezed out a final few payments and fees before foreclosing.
This kind of chicanery was illegal, and also violated the administration’s rules. But they didn’t bother to seriously investigate servicer abuses. The Treasury Department didn’t even permanently claw back a single one of its payments to abusive servicers.
Why not? Neil Barofsky, the bailout inspector general, later testified that protecting the banks was the actual goal. The administration’s aim was to “foam the runway” for the banks, as Barofsky witnessed Tim Geithner tell Elizabeth Warren. HAMP failed, in other words, because it was not designed to help homeowners.
As a result, in many cases HAMP actively enabled foreclosure. Its re-default rate — the fraction of people who got a modification and later defaulted out of the program — was 22 percent as of 2013. Only about $15 billion of the original $75 billion appropriation was spent by mid-2016.
Out of an initial promised 4 million mortgage modifications — itself a drastic underestimate — by the end of 2016 only 2.7 million had even been started. Out of that number, only 1.7 million made it to permanent modification, and of those, 558,000 eventually washed out of the program.
Letting off the Crooks
An epic crime spree after the crisis offered another opportunity to assist beleaguered homeowners.
During the bubble years, originators and banks had routinely mangled the paperwork while issuing loans and packaging them into securities. When they went to foreclose, they often found they did not have the correct documentation. But rather than acknowledging their indiscretions, financial institutions paid large teams of entry-level employees to commit document fraud on an industrial scale — forging signatures, falsely notarizing documents, or falsely attesting to “personal knowledge” of large mortgage files, hundreds of times per day. This was the so-called “robosigning” scandal.
These document problems eventually came to the attention of law enforcement. Forty-nine state attorneys general, the District of Columbia, and the Department of Justice banded together in a lawsuit, which resulted in a $26 billion joint settlement between them and the five largest servicers.
However, largely due to foot-dragging at the Department of Justice, the settlement ended up being toothless. Much of the cash went to “short sales” (simply selling an underwater home) instead of principal reductions, or to other weak relief. Servicers even received roughly $12 billion in credit for waiving outstanding debts from short sales in states where such a waiver is already legally mandatory. JPMorgan Chase allegedly claimed credit for forgiving loans that it had already sold.
Unsurprisingly, bending over backwards for the banks failed to stop the wave of foreclosures sweeping the nation. All told, some 9.3 million homeowners lost their homes. It was the greatest destruction of middle-class wealth since the Great Depression at least.
Black Wealth Destroyed
Even before the crash, decades of discriminatory policies had depressed African-Americans’ housing wealth. New Deal federal housing subsidies — the bedrock of the postwar middle class — largely locked out African Americans. Racist housing covenants forbade neighborhoods from selling or renting to black families, back up by the threat of riot. Black families that could buy were often brutally exploited by contract sellers.
The mortgage bubble fostered similar abuses. Originators, looking for anyone to take subprime mortgages, handed them out to disproportionately black lower-class people, and steered black middle-class families who would have qualified for ordinary mortgages into subprime loans as well.
Former Wells Fargo employees later testified that the bank deliberately tricked middle-class black families (who they called “mud people”) into subprime “ghetto loans.” Overall, a Center for Responsible Lending study found that from 2004 to 2008, 6.2 percent of white borrowers with a credit score of 660 and up got subprime mortgages, while 19.3 percent of such Latino borrowers and 21.4 percent of black borrowers did.
The effects of the foreclosure disaster are starkly apparent in Survey of Consumer Finances data. To start, the homeownership national rate shows a marked decline over almost the whole Obama presidency, reaching the lowest rate since 1965 (before slightly rebounding).

Broken down by race, the overall story for homeownership is similar for all groups, but black homeowners started lower and stayed lower than white ones, with no rebound at all from 2013 to 2016.

However, the total homeownership rate can be misleading in that it includes people with negative equity, which is worse than owning no home at all — it is merely “a rental with debt.” After the crisis, the percentage of black homeowners with negative equity exploded by twenty-fold, from 0.7 percent to 14.2 percent — and unlike white families, did not reach its peak until 2013.

Next we examined home equity by race. Here is average white, black, and Latino home equity by year:

The sharp decline from 2007 to 2013 is readily seen, as well as partial recovery through 2016, and the large racial wealth gap. Average white home equity in 2016 is 3.5 times greater than the same black figure, and it has regained 84 percent of its 2007 value, compared to a black figure of 73 percent.
Then there are the distributional effects. Home ownership makes up a much larger percentage of black and Latino wealth than it does white wealth, and a much larger percentage of middle-class wealth than top wealth in all racial groups. On the eve of the recession, middle-class families tended to hold 50 percent to 70 percent of their wealth in home equity, while the wealthiest 10 percent of families held 15 percent to 30 percent of their wealth in home equity.

Given these differences in wealth portfolios, bailing out financial assets after 2008 while allowing homeowners to drown directly concentrated the national wealth into the hands of the richest white families.
Between 2007 and 2016, the wealthiest 10 percent of white families saw their wealth expand by an average of $1.2 million (21.6 percent), the next wealthiest 10 percent of white families increased their net worth by an average of $141,000 (15.5 percent), and the top 10 percent of black families grew their wealth by $78,000 (8 percent). Everyone else experienced wealth declines as high as 40 percent.

Mass foreclosures have severe ripple effects. People who lose their homes are at greater risk of job loss and falling into poverty, and are more likely to commit suicide. Nearby homes lose value, as foreclosed properties are often blighted. A 2013 Center for Responsible Lending study estimated that properties in proximity to a foreclosure shed $2.2 trillion in value — and that half that loss was in communities of color.
The decision to hang homeowners — especially black homeowners — out to dry was a catastrophe.
A Better Way
Things could have been different.
The obvious place to start would have been a better HAMP. The administration should have followed the formula of the Home Owners’ Loan Corporation (HOLC) of the 1930s. The program bought up mortgages in default, and refinanced them with a lower interest rate and with a longer, fully amortized repayment period — a great help because there were no such mortgages at the time.
Subprime loans have high interest and bad terms, so interest rate cuts and restructured repayment schedules would have also done much good. To this an HOLC II could add principal reductions. (It also would obviously not produce redlining maps, as the New Deal version did.)
The $75 billion earmarked for foreclosure assistance in the TARP bailout almost certainly could have been used for this purpose. The bailout law directed the head of the Federal Housing Finance Agency (which had just become the conservator of Fannie Mae and Freddie Mac) to “implement a plan that seeks to maximize assistance for homeowners” on the mortgages that it owns. It specifically authorized interest rate reductions, principal reductions, and “other similar modifications.”
Given that Fannie and Freddie had trillions in mortgage assets, that could have provided hundreds of thousands of modifications immediately — and the $75 billion could have bought a lot more.
The goal would be to find and delete as much bad housing debt as possible, while keeping anyone who could pay anything even halfway reasonable in their homes — with generous terms when people fell behind. HOLC, for instance, usually waited an entire year before foreclosing on anyone who stopped paying, and tried to space them out to avoid broader economic damage.
Another good policy would have been “cramdown,” or allowing bankruptcy judges to modify the terms of first mortgages, as they can do for other types of debt. (Obama reneged on a promise to pursue this approach.)
The second possible strategy involves the aforementioned tsunami of crime.
Mortgage fraud is a serious crime in every state. And in New York, state law stipulates that underlying assets in an asset-backed security must be treated in accordance with the rules that set it up. These contained the usual legal boilerplate about how paperwork must be filed correctly. If a security did not follow the contract, it would be void. Under federal law, the income from such a broken security could be taxed at 100 percent.
With the threat of prosecution and taxation, the administration could have forced banks and servicers to accept genuine relief for underwater homeowners.
Then–Federal Deposit Insurance Corporation chief Sheila Bair had another good idea: simply force the banks and servicers to write down to face value any underwater mortgage that was more than sixty days delinquent.
But the administration did not pursue that idea either.
Instead, they let homeowners suffer as Wall Street returned to racking up enormous profits.
What Obama Wrought
It is impossible to say with any certainty what the precise effects of a sensible housing policy would have been. But it unquestionably would have prevented a huge fraction of the wealth destruction detailed above. The overall housing crash would have passed much sooner — even in 2016 the rate of foreclosure was higher than it was in 2005.
No political obstacle stood between President Obama and a better housing policy. On the contrary, his heavily bank-slanted policy cost the Democrats dearly: mass foreclosure, and the associated economic wreckage, is a large part of why his party was crushed in the 2010 midterms.
Because African Americans were disproportionately victimized at all levels of the housing and foreclosure crises, they stood to gain the most from better policy. But because Obama’s approach failed cataclysmically, the first black president in American history turned out to be a disaster for black wealth.

About the Author
Matt Bruenig is the founder of People's Policy Project.
Ryan Cooper is a national correspondent at TheWeek.com. His work has appeared in the Washington Monthly, the New Republic, and the Washington Post.
Reply Sat 16 Dec, 2017 01:08 pm
The Democratic Party Is Stacked Against Progressives

With the Democratic Party’s “Unity Reform Commission” now history, major political forces are entering a new stage of contention over the future of the party. Seven months after the commission’s first meeting—and nine months after Hillary Clinton backer Tom Perez won a close election over Bernie Sanders supporter Keith Ellison to become chair of the Democratic National Committee—the battle lines are coming into focus for next year.
The commission’s final meeting adjourned on December 9, after a few steps toward democratizing the party had won approval—due to the grassroots strength of progressives. But the recommendations from the commission will go to the Rules and Bylaws Committee, which was one of the DNC decision-making bodies that Perez subjected to a purge two months ago. Now, in the words of Jim Zogby (who was removed from the Executive Committee by Perez), “There are virtually no Bernie supporters on the Rules and Bylaws Committee.”
When the latest Unity Reform Commission meeting got underway, Perez talked a lot about unity. But kicking Sanders supporters off of key DNC committees is the ugly underside of an ongoing dual discourse. (Are we supposed to believe Perez’s soothing words or our own eyes?) And party unity behind a failed approach—internally undemocratic and politically hitched to corporate wagons—would hardly be auspicious.
“Emerging sectors of the electorate are compelling the Democratic Party to come to terms with adamant grassroots rejection of economic injustice, institutionalized racism, gender inequality, environmental destruction and corporate domination,” says the recent report “Autopsy: The Democratic Party in Crisis” (which I co-authored). The report adds: “Siding with the people who constitute the base isn’t truly possible when party leaders seem to be afraid of them.”

DNC Chairman Perez and allied power brokers keep showing that they’re afraid of the party’s progressive base. No amount of appealing rhetoric changes that reality.
“We pride ourselves on being inclusive and welcoming to all,” the Democratic National Committee proclaimed anew at the start of this month, touting the commission meeting as “open to the public.” Yet the DNC delayed and obscured information about the meeting, never replying to those who filled out an online RSVP form—thus leaving them in the dark about the times of the meeting. In short, the DNC went out of its way to suppress public turnout rather than facilitate it.
One member of the task force that wrote the Autopsy, Karen Bernal, is the chair of the Progressive Caucus of the California Democratic Party. After traveling across the country and sitting in the sparse audience during the first day of the Unity Reform Commission meeting, she took the liberty of speaking up as the second day got underway. Bernal provided a firm rebuke of the DNC’s efforts to suppress public attendance.
“For all of the talk about wanting to improve and reform and make this party more transparent, the exact opposite has happened,” Bernal told the commission. (Her intervention, which lasted a little more than two minutes, aired in full on C-SPAN.)
On Sunday, a mass email from Zogby via Our Revolution summed up: “We are fighting for racial, social, economic, and environmental justice. The Democratic Party needs everyone, regardless of their race, religion, gender, sexual orientation, age, ability, country of origin, language, or socioeconomic status, to be deeply involved in order to change the course of this country.”
For those reasons, he added, “we are calling for an end to superdelegates, open primaries and caucuses, same-day registration, and more transparent, fair, and accountable leadership at the helm of the DNC.”
Overall, the commission approved some recommendations that were partial victories for progressives. Among the most notable: It called for reducing the number of notoriously undemocratic superdelegates to the national convention from 712 to about 300, while the only democratic number would be zero. It somewhat improved transparency for often-dubious DNC contracts with high-paid consultants and vendors, while defeating sensible amendments by commission member Nomiki Konst—who spoke with notable clarity about the need to clamp down on financial conflicts of interest among DNC decision-makers.
The eight Sanders appointees—Konst, Zogby, Larry Cohen, Lucy Flores, Jane Kleeb, Gus Newport, Nina Turner and Jeff Weaver—put up a good fight as members of the Unity Reform Commission. They were outnumbered, and on key issues were often outvoted, by the 13 who’d been selected by Clinton or Perez. Next year, the odds to overcome will be much worse.
With the purged Rules and Bylaws Committee now overwhelmingly stacked against progressives, only massive pressure from the grassroots will be able to sustain momentum toward a democratic Democratic Party. Meanwhile, corporate forces will do all they can to prevent the Democratic Party from living up to its first name.
Norman Solomon, the national coordinator of the online activist group RootsAction.org, is a member of the task force that wrote Autopsy: The Democratic Party in Crisis. His books include War Made Easy: How Presidents and Pundits Keep Spinning Us to Death.
Reply Sat 16 Dec, 2017 03:50 pm
I was kind of certain that Perez would further the ruin of the Democratic Party. Hopefully, many of us (me included) are not going to be shown to be right in the long term.

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