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Murder, Suicide, Bank Robbery and More 1/22/09 Concord Monitor
Driving around New Hampshire, it appears that the only job out there is roof shoveling. February is a cold, dark slog at best, but this year has been a particular hell of bad news. Practically every day has featured stories of layoffs, foreclosures and evictions in staggering, mind-numbing numbers.
While most media focus has been on the much-needed stimulus package in Congress, the rising human cost of the economic tragedy at the grassroots deserves more attention. Nationally, suicides, acts of desperation, bank robberies and resistance to eviction have increased.
The emotional distress caused by this economy cannot be overstated. Coping with loss of a job or a home is, by any standard, major. Suicide hotlines have reported a surge in calls from Americans who are experiencing intense fear and despair over their finances. Those suffering isolation or acute loneliness are at particular risk.
There is no shortage of economic disaster stories in local papers all over. Here is a small compilation:
A Los Angeles man shot and killed himself, his wife and his five children after he and his wife lost their jobs. The police reported financial and job-related issues led to the slayings.
Last July a Taunton, Mass., woman faxed a letter to her mortgage company advising that by the time they foreclosed on her home, she would be dead. She wrote, “I hope you’re more compassionate with my husband and son than you were with me.” According to the Boston Globe, she shot herself with a high-powered rifle. She had been handling the family finances and had intercepted letters from the mortgage company for months. Her husband had no idea what was going on. In her suicide note, she said the stress was too overwhelming for her.
Last September a Pennsylvania woman robbed a bank to pay her rent, according to journalist Nick Turse of the tomdispatch.com website. Two months behind and facing eviction, the woman took the cash
she obtained from the robbery and went to another bank where she purchased a cashier’s check to pay her landlord.
A Chicago area woman recently robbed a bank there to pay off her payday loans. Caught in a debt trap, she saw bank robbery as her only way out.
In December, a West Palm Beach, Fla., man barricaded himself in his mobile home, set the place on fire and shot himself in the head with a shotgun, Turse reported. He was about to be evicted.
A 93-year-old Michigan man froze to death in his home after the municipal power company limited electricity, leaving him with no heat in January. The elderly man had not paid his utility bill although he apparently had the money to pay. Tragically, this information was not communicated to the company, and no one from the company bothered to contact the man personally. His autopsy showed that he suffered an extremely painful, prolonged death.
Not all have responded passively or self-destructively to bad economic news. Last September the Globe reported that four protesters tried to prevent the eviction of a Roxbury woman by chaining themselves to the steps of her back porch. Organized by the Boston-based organization City Life, this effort was part of an activist strategy to block foreclosures and evictions. City Life claims to have stopped nine evictions and to have given homeowners additional time to negotiate alternatives to foreclosure.
The sheriff of Wayne County Mich., the Detroit area, has decided to refuse to carry out evictions. The sheriff, Warren Evans, has had to deal with more than 46,000 foreclosures in the past two years. His office has had the job of physically removing people and their possessions from their homes.
Evans has determined that carrying out home foreclosures conflicts with federal law, specifically the Troubled Asset Relief Program goal of reducing foreclosures. “I cannot in clear conscience allow one more family to be put out of their homes until I am satisfied they have been afforded every option they are entitled to under the law to avoid foreclosure,” he said in a written statement.
Ohio Congresswoman Marcy Kaptur has suggested a radical anti-foreclosure strategy: squatting. Criticizing the congressional failure to protect homeowners facing foreclosure, Kaptur told reporter Amy Goodman, “Possession is nine-tenths of the law. Therefore, stay in your property. Get proper legal representation. . . . If Wall Street cannot produce the deed nor the mortgage audit trail . . . you should stay in your home.”
Because so many sub-prime mortgages were bundled into securities and then sold and sold again, mortgage holders may not be able to locate the actual loan note that binds the homeowner to the bad loan. Kaptur says homeowners should make the foreclosing entity produce the note.
Our society has proven to be remarkable for tracking record-breaking statistics. When it comes to registering RBIs, ERAs, passing yardage and sacks, nobody is better. However, when it comes to emotional distress caused by economic disaster, nobody is keeping score. If someone was keeping score, many points would have been put up on the board. We are talking a high-scoring game.
How to Help the Newly Unemployed: State has come far; federal reform needed 1/11/09 Concord Monitor
Back when I was in law school 25 years ago, my professor, the late Bruce Friedman, used to say things about the state’s Department of Employment Security that were unprintable in a family newspaper. Bruce was not exactly a fan. The department was harsh on workers, including many clients he represented.
In that era, New Hampshire typically had the lowest unemployment benefit recipiency rate of any state in the country. Only a small number of potentially eligible workers collected unemployment insurance benefits. New Hampshire workers also received among the lowest weekly benefits for the shortest duration of any state.
If I could use one word to sum up the unemployment system in New Hampshire back then, that word would be mean. The department did not make it easy for workers to collect. A head-in-the-sand mentality at the top promoted a program that was impervious to change. Protecting the unemployment trust fund translated into an agency with a culture of denial.
While there are still some vestiges of this culture alive and well, the good news is that Employment Security has come a long way from the bad old days. Under the leadership of Commissioner Richard Brothers and Deputy Commissioner Darrell Gates, the department broke the longstanding inertia and recognized the necessity for change. To his credit, Brothers supported long-overdue reforms that raised benefit levels and broadened coverage.
Instead of being dead last in the nation as far as generosity to workers, New Hampshire’s program is now more respectably in the middle of the pack compared with other states. These changes could not have come at a more fortuitous time.
According to the Labor Department, unemployment has hit a 26-year high nationally. Since January 2008, the nation’s employers have cut jobs every month, chopping 2.4 million positions this year. In New Hampshire, 5,680 workers filed initial unemployment claims in October. This is more than 2,000 more than filed in October 2007.
As a first line of defense for workers, the quality of the unemployment system matters tremendously. In a national poll conducted in November 2008 by Hart Research, 77 percent of workers who were receiving unemployment benefits reported that these benefits were very important to their ability to support their families with most
benefits spent on food and housing. Significant percentages of unemployed workers polled also had problems with economic issues like phone service cutoff, utility disconnects, interruption of education or training and payment for basic groceries.
Stepping back, it is a good time to reassess the adequacy of the unemployment system. We are facing the worst economy since the Great Depression. Unemployment has been neglected at the federal level by the Bush administration. Although little discussed or recognized, for eight years the needs of American workers were rendered invisible and disregarded as Bush and Cheney focused on their Iraq obsession. This neglect is another failure of conservatism.
Two types of reform
There are two immediate priorities for reform at the federal level. First, expanding the program of Extended Unemployment Compensation should be looked at. In light of the miserable economy, there is a need for further debate about how many weeks of unemployment benefits are appropriate. A feature of the current recession is increased long-term joblessness compared with other economic downturns.
Second, passage of the Unemployment Insurance Modernization Act should be a No. 1 priority. This bipartisan, revenue-neutral federal legislation would provide $7 billion to states which close major gaps in their unemployment programs. The unemployment system has a long history of failing to serve women, low-wage and part-time workers.
Benefit to New Hampshire
In New Hampshire, we still have a very low unemployment benefit recipiency rate. Only 31 percent of potentially eligible claimants collect.
The great thing about the Unemployment Insurance Modernization Act is that New Hampshire is perfectly positioned to reap the maximum benefit should it pass.
Because of reforms already passed in our Legislature, New Hampshire would be eligible for a $33 million infusion in our trust fund, plus an additional $2.3 million administrative allocation. This money would provide a timely boost to protect solvency since our unemployment trust fund has dipped below $200 million.
In considering any future economic stimulus plan, a good question to ask is how the proposal would affect the average working person. By that criteria, unemployment reform is worthy. It promptly puts money into the pockets of the unemployed, an act that will help to minimize some suffering in economically distressed households.
State Must Act To Ease Fuel Costs – 9/21/08 ConcordMonitor
The idea that New Hampshire citizens will freeze in their homes this winter because of an inability to afford high energy prices is simply unacceptable: legally, morally and humanly.
Among the oldest New Hampshire traditions is community caring and concern for neighbors in need. It is inscribed in our state law which mandates a legal duty to relieve and maintain vulnerable individuals and families. These laws have been with us since the early days of the state.
The coming winter demands the equivalent of a full-court press to ensure against the possibility that citizens will be living like they were under siege in Sarajevo during the winter in the Balkan War.
There is no magic form of relief to address all the need. Rather there are numerous ideas that if implemented collectively could greatly reduce the risk to public health and safety.
Probably most important is a big increase in the federal Low Income Home Energy Assistance Program. The state received about $25 million to help 33,000 low-income families last winter. The state would need $50 million just to serve a comparable number this winter.
With more people needing fuel assistance, maximizing LIHEAP is critical. LIHEAP will exclude many families though. The state must be prepared to assist more middle-income families who will not qualify for LIHEAP eligibility.
To supplement LIHEAP, we need an appropriation of state dollars. There is recent precedent for such action. In November 2005, the Legislature allocated $10 million in state funds because it was expected LIHEAP money would be inadequate.
Other New England states like Vermont and Maine have created such state appropriations. New Hampshire should do this. To do otherwise would be a Katrina-like non-reaction.
For those who are a little better off financially, there could be a revolving loan fund for customers and fuel dealers. The state could contract directly for fuel oil deliveries for energy assistance customers and could pay the dealers to assure cash flow. These customers would be responsible for repayment of fuel loans.
Improving weatherization is another excellent idea. Maine has increased its weatherization funding by $2 million so that it is now spending $8.5 million to weatherize 2000 homes for this coming winter. Last year, our state program weatherized 757 homes. Typical weatherization
improvements can reduce fuel use by 20 percent.
The New Hampshire Department of Health and Human Services could resurrect its Emergency Assistance Program specifically to address fuel assistance. Such a program could apply to all adult categories and be accessible to those facing no heat.
For those on the food stamp program, adjustment in the standard utility allowance so that it reflected actual cost of utilities would tangibly help families.
A higher food stamp benefit would mean families could free up a little more money to spend on utility costs To its credit, the state has pushed the federal government on this front.
Similarly, the New Hampshire Housing Finance Authority could raise its standard utility allowance and it could raise fair market rent so that more rental units might become available for Section 8 housing.
The home heating crisis is a housing crisis. Homeowners will be choosing between making mortgage payments and paying the energy bill. Renters with utilities included in the cost of rent may face rent hikes. In cases where the renter is responsible for utilities, the renter will face a choice like the homeowner.
A likely result will be a spike in foreclosures and evictions. It is safe to predict major pressure on homeless shelters. The state should consider expanding shelter capacity.
At the local level, there is no substitute for community organizing and promoting awareness of at risk families. The new Hopkinton initiative, Wood for Warmth, sounds like a model other communities could emulate. Hopkinton is creating a Wood Bank for those in need.
Neighborhood watch organizations to check on the elderly could also be a lifesaver. Turning the thermostat way down may be an unhealthy option chosen by those on fixed incomes. The combination of despair and lack of income could easily lead to choices that might otherwise be perceived as irrational. Prolonged exposure to extreme cold interferes with clear thinking.
While there are undoubtedly New Hampshire people who would rather die than seek help, if the above options are implemented, much less harm will occur. People will still fall through the cracks, but these suggested alternatives are preferable to finding dead bodies in the spring.
“Human salvation lies in the hands of the creatively maladjusted.” Martin Luther King Jr.
Iraq and the Credibility Chasm: Neither Right Nor Reason Require Our Continued Military Presence – 7/4/2008 – New Hampshire Business Review
During the Vietnam War, a famous phrase emerged: the credibility gap. It referred to the gap between what the government said about the war and what was actually going on.
Now, with the war in Iraq, we have a credibility chasm. There is almost no relationship between the Bush Administration’s picture of events and the utterly devastated and bleeding landscape known as the country of Iraq.
Military efforts have created a river of spilled blood and human misery. And for no good reason. There is no persuasive justification for the war and, in truth, there never has been.
The American occupation troops in Iraq are one more military force among contending Sunni and Shia militias, death squads and mercenaries. We have gone from fighting a Sunni insurgency on behalf of a Shia government to fighting a Shia militia while arming and paying off Sunnis.
It is not in the national interest of the United States to remain embedded in this quagmire. Neither right nor reason require our continued presence. After the last five years, prompt withdrawal would be an act of sanity.
The late journalist I.F. Stone used to say that all governments lie. What is striking about the Iraq War is that the proof of this truism is readily available in the public domain. In April, the New York Times reported on the Bush Administration’s efforts to shape coverage inside the major TV and radio networks.
The Bush Administration hired and paid military analysts to dupe the American public by presenting propaganda as independent military analysis. This systematic sales job began in 2002 and it continued until April 2008, when the Pentagon suspended the program after it was revealed. Internal Pentagon documents referred to the military analysts as “message force multipliers”. Even worse, many of these military analysts worked or lobbied for military contractors. None of this was disclosed to the public until the Times broke the story.
The Pentagon monitored the reporting of the hired military analysts. Reliable surrogates were rewarded. According to the Times, defense officials expected the surrogates to use their talking points. Those who displayed a degree of independence would receive critical phone calls from their Pentagon handlers moments after being on the air.
Considering the fact that this important story is public information, it is surprising how little coverage the story has received. The failure to report on this story is essentially a cover-up and a continuation of the shameful and cowardly behavior that led to this war being sold to the public.
Based on experience, we need to look at what the Bush Administration does rather than what it says. There is no Bush exit strategy from Iraq. Contractors have built and are building five massive military super-bases. They are a giant ongoing construction project.
The U.S. embassy in Baghdad, which is newly opened, has been described as “Vatican-sized”. It includes 21 blast-resistant buildings built on a 104 acre parcel. It is designed to run an ongoing military occupation. Price tag: over $730 million.
While little discussed, there is acute awareness in administration circles that Iraq sits atop a vast reservoir of oil. In speculating about reasons the U.S. government would continue this venture, oil must be at the top of the list. No less than Alan Greenspan, the former Federal Reserve chief, write in 2007, “I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq War is largely about oil.”
According to Nobel Prize-winning economist Joseph Stiglitz, the war is costing American taxpayers $2 trillion. Stiglitz believes the cost will reach $3 trillion. It must be remembered that the Bush Administration predicted at the start of the war that the war would be self-financing. They said it would cost $2 billion total to rebuild Iraq.
The Iraq War is an epic disaster on a scale unrivaled in American history. Being spectacularly wrong across the board is the defining quality of the Bush Administration. They were wrong about weapons of mass destruction, the Al Qaeda-Iraq connection, the number of likely casualties, how our troops would be greeted and how long the war would last. Not to mention so many other things.
Nir Rosen, a well-informed writer about the Middle East, has written, “Iraq has been killed, never to rise again. The American occupation has been more disastrous than that of the Mongols who sacked Baghdad in the 13th century. Only fools talk of ‘solutions’ now. There is no solution. The only hope is that perhaps the damage can be contained.”
Persisting on a failed course is tragic and stupid.
Deck Stacked Against Poor in Court: Vast Majority of Legal Needs Not Being Met – 6/27/2008 -Concord Monitor
Two years ago, the New Hampshire Citizens Commission on the State Courts issued a wide-ranging and visionary report about our justice system. The commission, a group of 103 New Hampshire citizens appointed by Chief Justice John Broderick, met for months gathering information before crafting a number of recommendations for change.
Among the recommendations: New Hampshire should examine the expansion of legal representation to civil litigants unable to afford counsel. The movement to create a right to legal counsel in civil cases has been called “civil Gideon.”
More than 40 years ago, the U.S. Supreme Court recognized the right to counsel for indigent criminal defendants in the landmark criminal case of Gideon v. Wainwright. Civil Gideon would extend the premise of right to counsel to limited civil cases when essential rights are at stake.
The American Bar Association gave civil Gideon a big boost when it endorsed a resolution supporting a civil right to counsel. The ABA resolution, passed in 2006, urges federal, state and territorial governments to provide legal counsel as a matter of right at public expense to low-income people in those categories of adversarial proceedings where basic human needs are at stake, such as those involving shelter, sustenance, safety, health or child custody.
The dilemma for our justice system is that most people who need a lawyer in a civil case cannot afford one. Regardless of the merit of the case, the idea of retaining a lawyer will probably be considered out of the question as an unattainable luxury. It does not matter whether the matter at stake is custody of a child, loss of housing or access to needed medical care.
Surely, as a society, we can do better than this. If the idea of equal justice under the law is to have genuine meaning, lawyers must be available to the broad masses of people – not just a wealthy elite.
Who gets a lawyer?
While there are many questions raised by civil Gideon, defining who would be entitled to counsel is probably among the most difficult. Consider these situations:
• A stay-at-home mother of two young children is served with divorce papers by her husband. In the past year, she underwent a total mastectomy, chemotherapy and radiation after being diagnosed with breast cancer. The husband is a wealthy businessman, and he has hired an expensive divorce attorney to represent him. Although he has been physically and emotionally abusive, he alleges his wife was an unfit parent. He seeks custody and he wants to minimize her visitation with the children. The wife cannot work and she is awaiting a decision on her disability claim. She is panicked about her income, her precarious health and the prospect of losing custody.
• A homeowner who has lived in his house for 17 years falls behind on his mortgage payments and faces foreclosure. Because of the bad economy, the homeowner has had his hours cut at work. A company that specializes in foreclosure rescues contacts the homeowner and advises that it can save the home. Company officials ask the homeowner to sign documents they have prepared. The homeowner believes he is signing a loan which will bring the mortgage current. Instead it turns out the documents surrender ownership of the home for a small fraction of its actual value. The foreclosure rescuer then proceeds to pursue eviction of the homeowner.
• An elderly man and his wife are sued by a hospital for non-payment of their medical bills after he undergoes major heart surgery. The couple has sold off many of their personal possessions to pay toward their bills. Their only major possession is their home. The hospital’s lawyer places a lien on the home, tries to force the couple to sign over their income tax return and pressures the wife to allow garnishment of her $200 a week wages from the fast-food restaurant where she is employed. The husband is so frightened that he cancels further medical visits and tests because of his inability to pay on the bills he already owes.
All of these scenarios are typical of the type of situation where representation by counsel could make a critical difference in outcome.
No such right
If you believe that any of the individuals in the examples above would be guaranteed a right to counsel, you would be wrong. There is confusion in the public about when the right to counsel is guaranteed. In a national poll, 79 percent of citizens responded “yes” when asked whether a poor litigant would have a right to free counsel if sued in a civil court. There is no such right.
Legal aid and pro bono programs do address a significant portion of the need. They are, however, under-funded relative to the huge need for civil legal assistance in housing, health, employment and family safety. A study from the federal Legal Services Corp. found that 80 percent of the civil legal needs of low-income people are not being met.
Recognizing the unmet need in 2007, the New Hampshire Supreme Court established an Access to Justice Commission to develop and implement policy initiatives to address gaps in the civil justice system, especially for those unable to afford the cost of legal services.
In articulating the need, I do not mean to minimize the many serious questions around cost, funding and implementation. With money so tight and so many legitimate competing needs, questions must be asked.
Still, as we enter a time of political transition, it is appropriate to set a new agenda, including civil Gideon. Lack of fairness in our civil legal process is a different type of cost with a heavy price tag. Meaningful access to justice requires access to lawyers.
Part-Time Benefits Deserve Benefits Too: Unemployment Benefits Out of Step With Times- 5/15/2008 – Concord Monitor
In a little noticed development, the New Hampshire Legislature recently acted to help a group that rarely gets attention: part-time workers. Lawmakers overwhelmingly passed Senate Bill 502, sponsored by Sen. Maggie Hassan, which extends unemployment benefits to part-time workers.
Business lobbyists did not oppose the bill as all cost estimates were quite modest. It now awaits signature from Gov. John Lynch.
New Hampshire will join 23 other states which provide some benefits to part-time workers who are laid off. The national trend has tilted toward removing part-time restrictions on unemployment benefit eligibility.
It is past time for this recognition. Almost a quarter of New Hampshire workers labor at jobs which offer less than 35 hours a week. Most are long-term workers. Over 70 percent of the part-timers are women. Yet, in most cases, these workers could not qualify unless they stated they were available for full-time work.
The employer community has greatly benefited from the growth of part-time work. Employers gain scheduling flexibility while typically offering lower wages and benefits. More part-timers translate into a savings on overtime costs. It is the rare employer who offers health insurance, vacation or holiday pay to the part-time worker.
Part-time work is a mixed bag for the worker. Much depends on whether it is a voluntary choice. For those juggling work and family responsibilities, a shorter schedule may be a blessing. However, many other workers would prefer full-time jobs if they were available.
Over the past 30 years, a new feature in job growth as been the creation of involuntary part-time employment. These jobs have turned job security into a memory and have reduced worker bargaining power. Labor economist Chris Tilly, author of a book entitled Half A Job, has argued that employers have created part-time jobs to meet their own needs, not to respond to employees’ needs.
The unemployment insurance program has been slow to modernize and acknowledge the changes that have occurred in the labor market. Unemployment insurance is a product of the 1930s. At that time, the model or norm was a male breadwinner employed full-time in the manufacturing sector. The expectation was a wife who did not work. She stayed home with the kids.
The architects of unemployment insurance could never have anticipated the tremendous increase in the number of women in the workforce, the huge growth of two-earner families, or the increasing share of low-wage part-time jobs that characterize our economy. Though, at this point, these are hardly new trends.
New Hampshire has been fortunate that both the Legislature and our state Employment Security, under Commissioner Richard Brothers, have shown a willingness to modernize and consider change which reflects a 21st century labor market.
Brothers, to his credit, championed the part-time bill. This is a contrast with previous Employment Security commissioners who had a hard time with almost any concept of change.
Our current recession makes the part-time legislation particularly timely. It should help more of the low-wage workers who typically have not collected in our state. New Hampshire has had a long tradition of low recipiency for those potentially eligible for unemployment benefits.
The broader context for the part-time issue is how working people are being brutally squeezed now on all fronts. Part-timers have been an almost invisible constituency within labor, rating little media coverage. It is great to see the Legislature stand up to help such an ignored group.
Government Must Help Homeowners 4/13/2008 – Concord Monitor
Possibly the worst aspect of our current recession is the dramatic rise in home foreclosures in New Hampshire and nationally. While New Hampshire is not doing as poorly as Michigan, Nevada or Florida, 3,000 families in the state are expected to lose their homes in 2008. That is worse than 2007 when more than 2,000 families lost their homes.
Along with this disturbing number is data which shows that more than 6 percent of home loans in New Hampshire are falling behind between 30 and 90 plus days. That is a higher percentage than elsewhere in the Northeast and worse than the rate of 35 other states. It certainly raises the specter of vacant, boarded up houses and homeless families.
With that in mind, it is surprising how weak the public policy response has been to this mess. There has been much commentary of the do-nothing or blame-the-victim variety. While it is apparently acceptable to spend untold billions on a pointless war, the idea of targeted help to homeowners is too much to contemplate.
To the extent Congress has shown itself prepared to act, lawmakers have been more interested in bailing out financial institutions than homeowners.
It is simply unacceptable for government to do nothing in the face of so many people losing their homes. Such inaction is equivalent to the Bush Administration’s response to Katrina. While there are homeowner situations which are financially hopeless, many are not.
A central problem is the adjustable interest rates on predatory sub-prime loans which have or will adjust upward.
The options presented to homeowners who have been victimized by sub-prime lenders is either some form of loan modification or foreclosure. That is because when interest rates are readjusted, which typically happens two years after loan origination, payments become financially unaffordable.
Very few of these homeowners can sell or refinance in this market. Mortgages often exceed property value.
It would be great if there could be more voluntary modification of loans. Last year President Bush urged lenders to work with homeowners to voluntarily adjust mortgages. Unfortunately, in the overwhelming majority of cases, lenders have been unwilling to renegotiate.
There is also the problem of locating the holder of the mortgage. It is hard to negotiate when you cannot find the holder of a resold, sliced and diced loan.
Government, which did nothing to prevent the subprime meltdown, should not default on its consumer protection duty. Government allowed unrestrained, unregulated greed to rule for years. Underwriting standards were obliterated.
Possible remedies
Ruling out any pro-consumer initiative as an unaffordable bailout is hardly fair. Discussion and debate need a chance.
There are possible federal and state remedies that deserve serious consideration. Probably most important is federal bankruptcy reform. Congress could allow mortgages on primary residences to be modified in Chapter 13 reorganization bankruptcies.
From 1978 to 1993, there was much precedent for successfully doing what is now proposed. Such modification is currently allowed and has also been allowed for family farms, investment properties, vacation homes, and commercial real estate. The sky did not fall.
Even though it looks now like the Senate is rejecting this bankruptcy reform, it must be pointed out that every major consumer organization in the country, including the Consumer Federation of America and the Center for Responsible Lending, supports the idea of this legislation. Doom and gloom scenarios about this legislation are grossly overstated.
Bankruptcy reform has the virtue of costing the U.S. Treasury nothing. Acted on promptly, it could allow thousands of families facing foreclosure to save their homes. There is a strong argument that lenders would fare better under loan modification than foreclosure.
A state response
In addition to federal reform, some states have pioneered policy responses. Last year Maine passed a Homeowners Protection Act that toughened underwriting standards and imposed a statutory duty of good faith and fair dealing on brokers. It added protections for high cost home loans and increased damages for predatory lending.
In 2004, North Carolina created a home protection fund pilot program to help unemployed workers. The program provides limited loan assistance for jobless families who can show reasonable prospects of resuming their mortgage payments. North Carolina’s program is modeled on a program from Pennsylvania, the Homeowners Emergency Assistance Program, that has been in place since 1983 and which has helped over 25,000 families maintain their homes.
While the North Carolina and Pennsylvania programs are not a response to the current sub-prime crisis, they show that states can respond effectively to a crisis where a significant loss of home ownership is at stake.
New Hampshire has a strong tradition of supporting home ownership. Foreclosure represents a personal catastrophe for the affected family. It is also an economic hit for neighbors who face depressed property values, a depopulated neighborhood and the likelihood of increased crime.
It is a mistake to assume nothing can be done to help homeowners. What is lacking is the political will to take it on.
Unchecked Power Has Terrible Consequences: 2/29/2008 – Concord Monitor
Unchecked Power Has Terrible Consequences: 2/29/2008 – Concord Monitor
Since at least 2004 there has been discussion among historians about whether George W. Bush is the worst president in American history. A more interesting question is why his presidency has failed so miserably.
There is no shortage of reasons. I would begin with his slavish devotion to the superrich at the expense of the bottom 99 percent. Then, of course, there is the war in Iraq. Lying to get us into a massively destructive, unjustified war must top any short list. The pathetically inadequate and embarrassing federal response to Hurricane Katrina also deserves mention.
Those reasons, while valid, do not really get to the heart of the matter. We have never before had a president who so ruthlessly and secretively expanded the powers of the presidency beyond the limits set in the Constitution. The Bush administration set this course from its start with no mandate from the voters to do so.
George Bush and Dick Cheney have worked to create a presidency beyond checks and balances where power trumps law. And it is no accident. Since long before 9/11, Cheney and a small clique of true believers have wanted to create a monarchical presidency. Cheney’s efforts on this front date back to the 1970s. In his fine book, Takeover, Charlie Savage lays it all out.
When they ran for office, neither Bush nor Cheney were forthcoming about their views of presidential power. Even worse, Congress and the media failed to ask essential questions about checks and balances.
Consider this: The administration can now designate American citizens as enemy non-combatants. With this designation, the administration can detain people indefinitely without judicial review, suspend Geneva Convention provisions at its discretion, and torture them (as long as it is not labeled torture).
The administration can use coerced evidence to convict them in a secret trial and can withhold evidence deemed essential for national security.
It can then block review of detention practices by denying habeas corpus.
Whenever Congress has attempted to weigh in, Bush has issued a signing statement, created an ever broader state’s secret privilege or used lawyers to put his actions beyond reach. The infamous Unitary Executive Theory underpins a naked power grab.
In truth, Bush has tried to turn the United States into a third-rate banana republic. As is well known, since 9/11, the U.S. government has gotten into the business of disappearing people much like Chile in the 1970s or Argentina during the dirty war.
The practice known as extraordinary rendition involves the CIA detaining and transporting suspected terrorists to countries like Syria, Egypt, or Jordan where torture is okay. The detainees become veritable ghosts held in secret prisons called black sites. There they are tortured.
How can it possibly be acceptable for the government to run a secret detention system while denying detainees access to courts, lawyers, and the outside world? Who is being held? Where are they? What torture is going on? How many people have been murdered? Where is accountability?
On July 16, 2006, the government released a “Terrorists No Longer a Threat” list about some of the 39 people listed by six human rights groups as having disappeared after capture. We are all left to draw our own conclusions since no further detail was provided.
Since the Bush Administration tells us they hold only the worst of the worst, the matter is supposed to be closed. Yet, the experience of Guantanamo shows they have frequently swept up innocents, people who were victims of score-settling or low-level fellow travelers. There is also a disturbing history of detaining wives and children of the disappeared for leverage.
As we consider presidential candidates from both parties, questions about the scope of executive power deserve higher profile.
Considering the scope of the misdeeds as well as their unpopularity, it is amazing how much of a pass Bush and Cheney have been given. The fact that they have not been the subject of multiple criminal investigations is a wonder.
They are living proof that unchecked executive power will not be used judiciously. The founding fathers anticipated people like Bush and Cheney. That is why they rejected the model of the British king and acted to preserve checks and balances.
Time To Reign In 21st Century Loan Sharks: Payday Lenders Prey On People In Need – Monday, December 10, 2007 – Concord Monitor
While it would be easy to think payday lending is some new phenomenon, nothing could be further from the truth. Payday lending is the modern form of usury. Usury and its regulation have been the subject of civil and religious debate for literally thousands of years.
Usury is not a word you hear used very often now. It has a musty, 19th-century quality. Usury can mean the price paid for the use of money. It can also simply mean excessive interest.
State usury laws refer to a body of law regulating the amount of interest charged by lenders. Most states have long had laws specifying the maximum legal interest rates at which loans can be made. For almost our entire history as a state, until 1999, New Hampshire has had such laws protecting consumers.
In January, the Legislature will take up House Bill 267, a bill placing an interest rate cap of 36 percent APR on payday and auto title loans. The bill is modeled on legislation passed by Congress in 2006 to protect our military service members who were being victimized by payday lenders. It would restore an interest rate cap which has been our state norm.
There is a long history dating back to before the American revolution of the use of interest rate caps to protect against usury. In his excellent book, Taming the Sharks, law professor Christopher Peterson recounts this history.
Originally, the colonies imported English law which included an interest rate cap statute called the Statute of Anne. The Statute of Anne imposed a maximum allowable interest rate of 5 percent per year. Most of the states initially imposed caps between 4 and 10 percent per year although after independence, most states set their maximum rate at 6 percent per year.
Little sympathy
Early American society featured a very strong thrift ethic. Reckless borrowing for personal consumption was extremely frowned upon. The public had little sympathy for debtors. State law rigorously enforced debts and a sense of shame attached to personal debt. This was the era of debtors’ prisons. Even though low interest rates were the norm, imprisonment for debt was very common. In Massachusetts in 1830, there were three to five times as many persons imprisoned for debt as for crime.
After the Civil War, attitudes toward personal debt loosened. A new lending practice developed called salary lending. Salary lending is the historic precursor of payday lending. The principle was the same. A debtor would borrow $5 and repay $6 at the end of the week.
While that might not sound too bad to modern ears, it led to chain debt, an early version of the repeat borrowing trap characteristic of payday loans. Manipulative lender practices like the imposition of staggering late fees and shady calculation of interest trapped debtors into endless payments.
Salary lending was characterized by lenders collecting the most money while reducing the overall debt owed as little as possible. If the debtor lost his job or suffered illness or could not pay for some other reason, interest compounded and debt swelled.
The salary lenders targeted employed and married working class white men, seeing them as good credit risks and likely to repay because of their steady employment histories.
1,000 percent interest
The term “loan-sharking” did not originate with the 20th-century Mafia. It actually comes from the period after the Civil War. In the Eastern cities, the salary lenders were infamous for charging interest rates over 1,000 percent annually.
The abuses and horror stories about this loan-sharking led to a series of governmental reforms and policy responses. Federal bankruptcy law reform allowing more discharge of debt, an increase in cooperative and charitable lending, and new small loan laws were all responses to the havoc created by usury.
The 20th century saw an explosion of credit and greatly expanded consumer debt. Old American stigmas about reckless borrowing disappeared and the credit card made its appearance.
In contrast to the New Deal period when government took a wide range of regulatory, protective steps, government since the Reagan era has promoted deregulation. Deregulation opened the door to exploitation of the poor.
When interest rate caps were scrapped in our state in 1999, the legislative history shows that the Legislature expected interest rates to go up to only 20 to 25 percent. There was no expectation interest rates would soar into the stratospheric rates of the payday lenders where the sky is the limit.
Five hundred percent APR? No problem if you are a payday lender. It is a sign of our moral confusion that we do not readily see payday lending as a gross form of usury. There are reasons the Christian, Jewish and Islamic traditions have all rejected usury as pure, unchecked greed. I expect ethical atheists would too.
This is not some moderately priced consumer credit. While payday lenders and auto title lenders strive for acceptance and legitimacy, they are 21st-century loan sharks. This is the dark side of deregulation where the administrative state has failed and consumer protection has been junked.
The issues around payday lending are just the latest round in an American fight over predatory lending that has been longstanding. No strategy will completely stop the payday lenders. They are foxy and will try to work around legislation. Still, restoring an interest rate cap is the time-tested reform which has proven most effective in curbing abusive money lending.
Jonathan P. Baird 