Obama announces right-wing immigration “reform” in national address

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By Patrick Martin
21 November 2014

US President Barack Obama delivered a nationally televised address on Thursday night, giving a preview of an executive order on immigration to be signed and made public on Friday.

As with most speeches by Obama, Thursday’s remarks exuded hypocrisy and cynicism. The proposal that Obama is implementing is thoroughly right-wing. His comments combined empty homilies describing the United States as a “nation of immigrants” with proclamations that the estimated 11-12 million undocumented immigrant workers must “play by the rules” and be held “accountable.”

The program outlined by Obama would cover less than half of the 11-12 million undocumented immigrant workers and children now in the US, with the remainder subject to immediate detention and deportation as “illegals.” In its six years in office, the Obama administration has already deported more immigrants than any government in US history.

Despite the howls of “amnesty” from sections of the Republican Party, and praise for the White House from its media backers and Democratic Party-affiliated Latino groups, Obama’s executive order is anything but a green light for immigrant workers seeking legal status, economic security and recognition of their human rights.

As Obama explained in his speech, the bulk of the 5 million or so immigrants who qualify for non-deportation and work permits must have lived in the United States more than five years and have children who are American citizens or legal residents. They must register with Immigration and Customs Enforcement, part of the Department of Homeland Security (DHS), pass a criminal background check, and pay any back taxes. In return, they will “be able to stay temporarily,” Obama said.

Obama’s speech was entirely within the right-wing framework of official American politics, in which workers who come to the United States fleeing poverty and dictatorship—for which American imperialism is principally responsible—and take the hardest and worst-paid jobs are demonized as criminals who must be “held accountable.” Meanwhile, the true criminal class in America, the financial aristocracy that controls both the Democratic and Republican parties, amasses untold and unearned wealth.

Referring to immigrant workers, Obama said, “All of us take offense at anyone who reaps the rewards of living in America without taking on the responsibilities of living in America.” Who is he talking about? Who is reaping rewards without taking responsibility?

Such terms apply with much greater justice to the parasitic ruling elite that Obama and the congressional Republicans and Democrats represent. These gentlemen were bailed out to the tune of trillions following the 2008 financial crash. But no banker or hedge fund mogul has had to repay these infusions of taxpayers’ money or been held accountable for the financial manipulations and fraud that wiped out the jobs and living standards of tens of millions of working people.

“Undocumented workers broke our immigration laws, and I believe that they must be held accountable,” Obama declared. The Obama administration has refused to apply this standard to bankers and speculators who broke laws against swindling, or CIA agents who broke laws against torture, or top officials of the Bush administration who waged illegal wars and lied to the American people. And, of course, the Obama administration itself operates outside the law, trampling on the US constitution in its assertion of unlimited presidential powers to spy on, arrest, detain and even assassinate American citizens.

Under the Obama plan, the majority of workers who have entered the country without legal documents will still be treated as criminals, to be expelled from the country as soon as they are discovered. The four million to five million covered by the executive order will become a federally regimented cheap labor force. Those who register with the DHS will gain only temporary security, subject to the decisions of the next president—or Obama himself if circumstances change in the next two years—in which case the DHS database will become an invaluable resource for the resumption of mass roundups, detentions and deportations.

Obama hailed as a model the reactionary immigration bill passed last year by a bipartisan majority in the US Senate, while complaining that the Republican-controlled House of Representatives had refused to bring it to a vote. This bill placed its main emphasis on border security while establishing a draconian 17-year-long process through which some undocumented workers could gain citizenship.

The administration has already implemented many of the Senate bill’s border security measures. Obama boasted of the record number of federal agents, sensors and drones mobilized on the US-Mexico border and announced, as the first part of his executive order, even further militarization: “We’ll build on our progress at the border with additional resources for our law enforcement personnel so that they can stem the flow of illegal crossings, and speed the return of those who do cross over.”

White House officials said that some provisions of the Senate bill, such as the citizenship process and special provisions for temporary agricultural workers, were beyond the president’s legal authority to enact in an executive order. The immigration measure was drafted under the rubric of “prosecutorial discretion,” in which the president, as chief executive, can decide to prioritize enforcement of immigration laws against particular categories of immigrants, given that the federal government lacks the resources to immediately round up 12 million people.

Obama spent a considerable portion of his speech defining how narrow the executive order would be, including denying Medicaid, food stamps or other benefits to immigrants given work permits.

“This deal does not apply to anyone who has come to this country recently,” he said. “It does not apply to anyone who might come to America illegally in the future. It does not grant citizenship, or the right to stay here permanently, or offer the same benefits that citizens receive—only Congress can do that. All we’re saying is we’re not going to deport you.”

As in many of his policy statements, Obama sought to present his immigration order as a happy medium between two extremes. “Mass amnesty would be unfair,” he claimed. “Mass deportation would be both impossible and contrary to our character. What I’m describing is accountability—a commonsense, middle ground approach: If you meet the criteria, you can come out of the shadows and get right with the law.”

“Mass amnesty” is, in fact, the only policy compatible with democratic principles. All workers should have the right to live in whatever country they choose with full citizenship rights. But under the capitalist system, capital is globally mobile while the working class is imprisoned within the borders of the nation-state.

Obama’s claim that mass deportation is “contrary to our character” conceals a contradiction. Certainly, for the vast majority of working people, the police state measures that would be required to round up and deport 12 million people, ripping apart millions of families, would be abhorrent. (By one estimate, 13 percent of all school children in California and Texas have at least one undocumented parent).

But for the US ruling elite, and for the Obama administration in particular, “rounding up millions” is perfectly conceivable. In its six years in office, the Obama administration has rounded up nearly three million immigrants already. Large sections of the Republican Party advocate detention and expulsion of millions more.

The dispute between the parties, insofar as it exists, reflects divisions within the ruling elite over how politically explosive such an operation would be and how disruptive of the functioning of large sections of the US economy that depend on superexploited immigrant labor.

Sections of the Republican Party, particularly those linked to the ultra-right Tea Party groups, have long used demagogic attacks on immigrants as a political weapon. Republican Senator Tom Coburn of Oklahoma suggested that any action by Obama perceived as pro-immigrant could touch off vigilante-style actions.

“The country’s going to go nuts, because they’re going to see it as a move outside the authority of the president, and it’s going to be a very serious situation,” he told USA Today. “You’re going to see—hopefully not—but you could see instances of anarchy. You could see violence.”

Obama made repeated appeals to ultra-right sentiment in the course of his television speech, pleading with Republicans that disagreement over immigration should not prevent collaboration in other policy areas once they take full control of Congress in January.

There is particular concern in Corporate America that the immigration issue could disrupt passage of a federal budget for the remainder of the current fiscal year, which began October 1. A continuing resolution to fund the government expires December 11, and House and Senate Republican leaders have been at pains to reassure Wall Street that there will be no repetition of the 2013 temporary shutdown of the government and no default on federal debt payments.

The Los Angeles Times, in one of the few press commentaries that cut through the pretense of huge disagreements between the two parties, noted Thursday that “the strong reaction by Republican leaders has less to do with opposition to the nuts and bolts of the president’s immigration policy and more to do with fear and anger that the issue will derail the agenda of the new Republican majority before the next Congress even convenes.” This includes making deals with Obama over pro-business measures on taxes, trade and energy policy.

 

 

US government, corporations preparing new offensive against workers’ pensions

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By Jerry White
20 November 2014

The release of the annual report of the US Pension Benefits Guaranty Corporation (PBGC) is being seized upon by the media and politicians of both parties to press for a new round of devastating cuts to pension benefits for tens of millions of retired industrial and other private-sector workers.

The PBGC is the government insurer for 24,000 defined benefit pension plans, which cover more than 41 million workers, retirees and their dependents. On Monday, the government-backed corporation released a report showing that the long-term projected deficit of its multiemployer program rose by $34 billion in fiscal year 2014 to a record $42 billion. This was largely due to potential losses from shoring up two large pension funds that could become insolvent in the next decade.

Although they were not named in the report, the two funds are reportedly the Teamsters Central States fund and the United Mine Workers fund, which together cover some 10 million current and retired workers. The precarious position of the funds, which are jointly administered by the two unions and trucking and mining companies, is due to the wiping out of hundreds of thousands of jobs, which has left many companies with more retirees than active workers. The pension funds were also hit by stock market losses.

The Washington Post and Wall Street Journal zeroed in on a single paragraph in the report warning that the PBGC could go broke over the next eight years if the current rate of premium payments from corporations continues. The “risk of insolvency” would rise over time, the report said, “exceeding 50 percent in 2022 and reaching 90 percent by 2025.” It added, “When the program becomes insolvent, PBGC will be unable to provide financial assistance to pay guaranteed benefits in insolvent plans.”

Nowhere in the media or political commentary on the report was there any suggestion that the government should carry out a Wall Street-style bailout of the pension insurer. The Post noted that that such a bailout was a “political non-starter” in Washington.

Nor was there any suggestion that Congress should mandate a major increase in contributions from the big corporations, which have extracted billions from the labor of workers while deliberately diverting funds from their pension plans and keeping them chronically underfunded.

Instead, in the name of “saving” the pensions, the capitalist media is demanding savage cuts in the workers’ benefits.

The Wall Street Journal wrote Tuesday that any solution to the agency’s “long-running problems” would likely include “sharp benefit cuts for the plans.” The Post concurred on the same day, saying, “Unless Congress makes changes, which could include raising insurance premiums for multiemployer plans or the controversial move of allowing for preemptive pension cuts in struggling plans,” the PBGC will go bankrupt.

One proposal, cited approvingly by the Wall Street Journal, came from the Center for Retirement Research at Boston College. A 30 percent benefit cut on average for current retirees, the report said, would allow the Teamsters plan “to remain solvent indefinitely and increase the aggregate welfare of plan participants.”

Leading Democrats and Republicans added their voices to the choir demanding action.

The annual report was “a sober reminder that time is running out” said Congressman John Kline (Republican from Minnesota), chairman of the House Committee on Education and the Workforce. The multiemployer pension system “is a ticking time bomb that will inflict a lot of pain on workers, employers, taxpayers and retirees if Congress fails to act,” he added.

Senate Finance Committee leaders Ron Wyden (Democrat from Oregon) and Orrin Hatch (Republican from Utah) issued a joint statement saying they remained “very concerned” about the multiemployer system.

As usual, the trade unions are willing accomplices in the crime being prepared against the working class. According to the Washington Post, “A coalition of unions and businesses has been pushing for reforms, including more flexible coverage structures and pension cuts in financially struggling plans.”

Last year, “a commission made up of representatives from employer and labor organizations,” the Wall Street Journal reported, issued a proposal “that would include the extreme step of cutting pension benefits for some current retirees in the most troubled plans.”

One such joint labor-management body is the National Coordinating Committee for Multiemployer Plans, which includes the presidents of the Teamsters, the AFL-CIO’s construction trades, the Service Employees International Union (SEIU), and the United Food and Commercial Workers (UFCW). It has called for congressional action, warning that employers planned to exit the system and “leave retirees behind.”

The union executives could care less about their retired members. These unions have spent decades collaborating in gutting pension benefits in order to boost the corporations’ profits. The threatened liquidation of multibillion-dollar pension investment funds, however, threatens the income and portfolios of the aspiring capitalists who control the unions.

There is an element of deliberate crisis mongering in the PBGC report. The shaky position of the agency has long been known and nothing has been done about it.

Over the last three decades, more and more corporations have jettisoned their employer-paid plans—one of the most important gains won by the working class in the mass industrial battles of the 1930s, 1940s and 1950s. All but a few have forced current workers onto employee-paid 401(K) plans subject to the vagaries of the stock market.

Earlier this year, aerospace and defense giant Boeing worked in tandem with the International Association of Machinists (IAM) to force 33,000 IAM workers onto 401 (K) plans. The company’s top executive, Jim McNerney, has a special retirement plan valued at $42 million, which will provide him with over $270,000 per month after he quits.

It has long been a standard business practice for American corporations to dump their pension obligations onto the PBGC through bankruptcy. Since Congress established the PBGC as part of the 1975 Employee Retirement Income Security Act (ERISA), the government-backed corporation has paid out billions to cover pension plans terminated by giant corporations, particularly in the steel and airline industries.

As millions of workers know through painful, first-hand experience, when the PBGC takes over an insolvent fund, the workers are hit with brutal benefit cuts. Congress limits the amount the agency can pay to retirees to less than $13,000 a year, effectively condemning the workers to poverty. A worker with a very modest annual pension of $20,000 after 30 years of labor stands to lose more than $7,000 a year—a cut of over 35 percent.

The decks are being cleared for the next stage in the relentless, bipartisan assault on the working class. Private-sector pensions will be targeted along with other supposed “ticking bombs” such as Social Security, Medicare and public-sector pensions.

The nationwide offensive against the pensions of state and municipal workers has already been launched with precedent-setting rulings by federal bankruptcy judges in Detroit and Stockton, California declaring null and void provisions of state constitutions guaranteeing the pension benefits of public employees.

Last week, a federal bankruptcy judge gave final approval to the Detroit bankruptcy settlement, which imposes huge cuts in the pensions and health benefits of retired city workers and imposes 401(k) plans on active workers. This week, the PBGC report has signaled the widening of the attack to include the private sector.

The official justification is the claim that society simply cannot afford to keep the “overgenerous promises” made to workers in an earlier, more prosperous period. The situation is supposedly made worse by the problem of workers living too long after retirement and imposing an unsustainable burden on the rest of the population.

These are self-serving lies pumped out by the ruling class through its political servants and media apologists. Since the financial crash of 2008, the Obama administration’s pro-business policies of bank bailouts, virtually free money for the banks from the Federal Reserve, wage and benefit cuts for auto workers, corporate tax cuts and deregulation have transferred trillions from the working class to the super-rich.

The share of the gross domestic product going to corporate profits is at the highest level since World War II, while the share going to workers’ wages is at the lowest. American corporations are sitting on an estimated cash hoard of $1.5 trillion and using it for stock buybacks, executive bonuses and mergers and acquisitions that are occurring at their most frenzied pace since 2007.

The total $60 billion deficit of the PGBC could be wiped out overnight by using only a portion of the $360 billion being hoarded by tech giants Google, Apple, Cisco and Microsoft, or employing one-tenth of the annual Pentagon budget.

Instead, the financial oligarchy that controls the economy and both big-business parties is determined to steal the pensions that tens of millions need to survive and return workers to the dark days when they labored without end until they died.

http://www.wsws.org/en/articles/2014/11/20/pbgc-n20.html

The One Party Planet: an analysis of the world today

by James Wan on November 19, 2014

Post image for The One Party Planet: an analysis of the world todayHas the time come to revive the radical political pamphlet? /The Rules’ critique of neoliberalism as presented in The One Part Planet proves that it is.

Back when I was at university and feeling particularly idle one night, I had an idea to test my college magazine’s “we-publish-anything” policy and also have a bit of fun. I decided to make up a bunch of absurd ‘facts’ and submit them under the heading Did You Know?. Chuckling to myself, I made-up ‘facts’ such as: “Bhutan has two national flags: one for when it’s sunny, one for when it’s raining”, “In the Malay language, there are 4 words for ‘fridge magnet’ but none for ‘fridge“, and “There are no mice in Nicaragua”.

The whole thing was clearly silly and my intention was that readers might just about believe the first claim − that “pork is a mild aphrodisiac” − and maybe even the first few, but as the facts got increasingly ludicrous, they would realize the exercise had been a hoax all along.

Once the magazine was published the next week then, I was astonished to realize that barely anyone had got the joke. Everyone of course had instantly known that some of the facts were complete nonsense − the scientists, for example, knew full well that iguanas don’t have seven lungs, and I doubt any film buffs really believed the working title for Jaws had been ‘What a Big Shark!’ − but while they all discarded certain specific claims, very few questioned the validity of the list as a whole. The facts they knew to be false, they discarded; the rest they still took at face value.

 

 

 

 

 

I tell this story not just as a cautionary tale to any editors who receive submissions from me late at night, but to highlight one essential cognitive bias. Namely, that it is not particularly difficult to be skeptical towards individual details − the numbered ‘facts’ − but it is rare for that skepticism to broaden out into a questioning of underlying assumptions. In this case, the premise of the list as a whole. Sometimes all those trees just end up obscuring the wood.

It is this tendency that partly accounts for why so few people realized my list of made-up facts was complete bullshit, but which also helps explain one the conundrums of the progressive movement: that despite widespread acknowledgement of huge global injustices and inequalities, the underlying assumptions of the system tend to get an easy ride.

There is plenty of rightful outrage at corruption, endemic poverty and systemic exploitation, yet from most political discussions to mainstream media debates, and from well-meaning ethical consumerist actions to celebrity-sponsored charity campaigns, there appears to be an implicit acceptance that what we’re doing on a broad scale is basically fine. The problem, apparently, is that we need to do it a little better, tweak it here and there, or add something else on top.

It is well-known that workers’ rights in many places are systematically trampled on; that a billion people are chronically malnourished even though we produce enough food to feed the world one and a half times over; that the governments of developing countries lose at least $1 trillion each year through tax havens; that levels of greenhouse gas emissions are accelerating despite an apparent commitment from world leaders to decrease them; that the richest 1% of the world own half of all global wealth; and that, according to World Bank figures, 80% of the world’s population live on less than $10/day while 60% live on less than $5.

All this is acknowledged and provokes anger. But in the same way my college readers were skeptical of the claim that “Pope Benedict used to be a professional arm-wrestler” yet never questioned the integrity of the list as a whole, it is rare that outrage at global injustices translates into doubt at the efficacy of the system itself. It seems that no matter how extreme, numerous or engrained the inequality, poverty or oppression, the idea that large-scale change is necessary is still simply ‘too radical’ for most.

Of course, it is not just our cognitive biases that prevent a greater acceptance of progressive views. Advocates of market liberalism have been hugely successful in painting their ideology as non-ideological common sense. But the question remains: if knowledge of deep global problems is not enough to make people question the wisdom of the status quo, what can?

There are certainly many possible answers to this question, and any struggle of ideas has to be waged at several levels on several fronts. Some strategies will no doubt need to be smart and innovative, drawing on new forms of communication and technology. But at the same time, perhaps we also need to look back to older tried and tested tools: things like the humble political pamphlet for instance.

 

 

 

 

 

 

 

 

This is exactly what the activist organization /The Rules has done with The One Party Planet, a 60-page pamphlet that provides a detailed critique of neoliberalism and the unbridled power of the 1% (or rather 0.01%). We are essentially a “one party planet”, it argues, bringing together several different strands of reasoning and evidence, because the global political and economic elite all essentially hold the same worldview.

From American CEOs to Chinese party officials, and from African presidents to Russian oligarchs, there is an overwhelming consensus that unrestrained selfish competition is not only the best, but the only possible, way to organize society. This is not a conspiracy concocted in dark smoky rooms, and the individuals at the top don’t share some grand master plan. But the internal logic of their actions is one and the same, and this has contributed, the pamphlet argues, to a situation in which an unelected elite wield incredible influence over politics and inequality has reached outlandish levels.

In response to this, The One Party Planet culminates in a carefully argued call for a global uprising. This might seem like a contradiction − how can you carefully call for an uprising? − but that is perhaps where the power of the political pamphlet, and this one in particular, lies. Unlike books, which can be long and detached; newspaper articles, which can be brief and fleeting; and documentaries, which are received somewhat passively, the political pamphlet speaks directly to the reader with enough time and space to make a clear and detailed argument. It can make the apparently radical seem self-evident.

And perhaps this is one of the greatest weapons the progressive movement has right now. After all, the evidence and statistics about poverty, inequality and corruption are increasingly being understood and accepted − the facts have become mainstream. Maybe what we need first and foremost now then is fairly simple − something that will sit us down, talk us through it, and connect the dots. Something that can make the case that the foremost global problems of our age are not isolated but interconnected, not superficial but structural, and not inevitable but man-made. The One Party Planet does this with impressive depth, humility and conviction.

Download the pamphlet here

James Wan is the Senior Editor of Think Africa Press. His work has featured in a wide range of publications and in 2013 he was shortlisted for The Guardian’s International Development Journalism Competition. You can follow him on twitter at @jamesjwan

Why America’s housing disaster is back and wreaking terror

“An ongoing criminal enterprise”:

Remember the housing nightmare that busted the economy? The crooks are back and here’s what they’re secretly up to

"An ongoing criminal enterprise": Why America's housing disaster is back and wreaking terror
(Credit: Reuters/Robert Galbraith)

According to housing analyst RealtyTrac, foreclosure filings shot up 15 percent last month, the largest increase in over four years. Almost 60,000 homes were newly scheduled for auction in October, a spike far beyond the usual seasonal rush to complete repossessions before the holidays. Auctions rose 53 percent in Nevada, 118 percent in New Jersey and an amazing 399 percent in Oregon.

Continued demand for foreclosed properties by institutional investors and increased sale prices finally make it cost-effective to sell these homes, after persistent delays. “Distressed properties that have been in a holding pattern for years are finally being cleared for landing at the foreclosure auction,” said Daren Blomquist, vice president at RealtyTrac.

If lenders have finally begun to finish their oldest foreclosure cases, you might assume that they have moved past their problems with processing foreclosures. After all, for years, mortgage servicing companies, who file foreclosures on behalf of the owners of the loans, presented millions of false documents to courts. They also engaged in “robo-signing,” where employees signed affidavits attesting to the validity of foreclosure actions, despite having no knowledge about the underlying cases. The five leading servicers agreed to a $25 billion settlement over these problems, vowing to reform their ways.

But you would be wrong to assume that anything has changed in our foreclosure courts.

New evidence over the last month shows that servicers employ virtually the same improper techniques when foreclosing. Instead of robo-signers, they use robo-witnesses, or robo-verifiers; more on them in a moment. Regardless, they are breaking laws and degrading the integrity of the courts to kick people out of their homes, a sad and enduring legacy of the destruction of the nation’s property system during the housing bubble years.

In 22 U.S. states, lenders must file foreclosure complaints with a court, and prove the facts of the case before a judge. But servicers have shown themselves largely unable to perform this seemingly simple task.



During the housing bubble, mortgages were traded so rapidly, with insufficient documentation, that true ownership has been confused on millions of loans. In addition, servicers operate with such thin profit margins and bare-bones staff that they don’t have the resources to retrace the steps of the mortgages, which may have gone through eight different companies or more. So they have resorted to a number of shortcuts to evict homeowners.

When servicers got caught robo-signing, they stopped. But they trained a new set of employees, best described as robo-witnesses. These low-level personnel work for the servicer’s litigation departments, and they fly around the country from courtroom to courtroom. Reading from a script, robo-witnesses claim to have personal knowledge of their employer’s practices, and that they can swear to the legitimacy of the foreclosures. “They’re trained to parrot a script, you could just bring a parrot in,” said Lisa Epstein, a foreclosure expert now working for a defense attorney.

But these robo-witnesses know pretty much nothing beyond the script; they have no insight into the individual cases in which they’re testifying. “They walk into court having read the documents of the case a moment before,” said Thomas Ice, a foreclosure defense attorney in Palm Beach, Florida. Ice argues that it’s no different than robo-signing, just moved into the courtroom. “They don’t give their signature now, they just perjure themselves in court.”

This has been a standard technique for several years; I first wrote about it in 2012. But now, defense attorneys have adjusted, cross-examining the robo-witnesses and appealing cases because of this mass perjury. And appeals courts in Florida have begun to agree.

In one case last month, the 1st District Court of Appeals reversed a case featuring robo-witness Andrew Benefield. The court found that Benefield “had no personal information” about the authenticity of the documents he testified about in the case.  In another case, the appeals court ruled that the robo-witness swore to the correct loan balance based only on the review of computer printouts, “and she had no information about how and when those records had been prepared or where the data came from.” Other appeals courts in Florida have ruled similarly, effectively making robo-witnesses a failed tactic.

Servicers have run into another problem in Florida, ground zero for the foreclosure crisis. Because of a series of state Supreme Court rulings after the robo-signing scandal, an employee affiliated with the servicer must sign a document that says, “Under penalty of perjury, I declare that I have read the foregoing, and the facts alleged therein are true and correct to the best of my knowledge and belief.”

Defense lawyer Evan Rosen of Fort Lauderdale, Florida, decided to depose one of the signers of these verification statements: Lona Hunt, foreclosure specialist for Seterus, servicer for the mortgage giant Fannie Mae. In the deposition, Hunt admitted twice that she never read the complaint at all before she signed the document swearing that the facts were correct.

Hunt testified that she only scanned the foreclosure complaint, checking that the defendant’s name and date of default matched what was on a computer screen.  She misidentified key documents in the case, did not know the meaning of basic legal terms in the complaint, and basically showed little expertise about anything related to mortgages and foreclosures. You can read the deposition here.

It’s impossible for someone with such a limited knowledge base about foreclosures to verify that the facts of an individual case are correct. And keep in mind that this verification process exists in Florida because servicers illegally robo-signed official documents and got caught. The courts decided to increase legal consequences by forcing servicers to verify the truthfulness of their claims. Yet they are robo-signing those verifications too.

So why is this important? If the verifiers cannot verify and the witnesses bear no witness to the facts, so what? Didn’t homeowners default on their loans? Why should they get a free pass? This is the familiar refrain of those who would minimize this misconduct. Some even blame the states for forcing the poor servicers to prove they own the homes they want to repossess.

Here’s the truth. False documents and mass perjury, both criminal violations, make a mockery of the judicial system. It means that the servicers have as much legal right to foreclose as I do. To say that the homeowner is guilty of not paying, so their lender can do whatever they want to force them out of the home, is like saying the murder suspect is obviously guilty, so the cops can plant false evidence. We have a system of law to defend the rights of everyone, and ensure equal treatment.

Moreover, as Jim Kowalski, executive director of Jacksonville Area Legal Aid and a longtime foreclosure attorney, told me, “when you have procedural defects in these cases, you will almost always have substantive defects.” Multiple reports and studies verify this. The inspector general for HUD, for example, took a sample of JPMorgan Chase loans and could not find documented proof for the amount owed on 35 out of 36 loans. This gets worse when servicing transfers between several companies; the amount owed becomes subject to a game of telephone, with dollar amounts effectively made up.

That means that the amounts servicers claim borrowers owe have no basis in fact. Multiply that by the tens of millions of outstanding mortgages, and you’re talking about tens if not hundreds of billions in questionable charges, from which nobody is safe. This makes defaults really educated guesses, often driven by the fake fees and incompetence. To compound this, servicers use bogus witnesses and perjured documents to “prove” the defaults are legitimate. The entire system is fraudulent and in need of overhaul.

This is where law enforcement should step in. The Justice Department settled with these same companies over robo-signing, and in the agreements demanded that they never do it again. Well, they’re doing it again; in fact, they never stopped. Bad documents have remained in the system, as Gretchen Morgenson explained over the weekend, being used to continue to punish borrowers. Nobody has rooted out this rot at the heart of our housing market. “It’s happening every day,” lawyer Tom Ice said. “And the world doesn’t care.”

Ninety-five percent of borrowers never show up to defend their foreclosures. Servicers get away with this because they can afford to lose one case if another 20 go through. The only way to fix this crisis on a thorough basis, instead of waiting for one-off judgments in individual cases, is for government officials to enforce the law. Otherwise, literally nobody is safe from the corrupt practices of a mortgage industry acting as an ongoing criminal enterprise.

Child homelessness at all-time high in US

“A permanent Third World in America”

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By Niles Williamson
18 November 2014

America’s Youngest Outcasts, a study released this week by the National Center on Family Homelessness at American Institutes for Research (NCFH), reports that 2.5 million American children were homeless at some point last year, a historic high. The authors of the report warn that if these brutal social conditions persist or worsen, the result will be a “permanent Third World in America.”

More than six years after the height of the foreclosure crisis and fifty years after the declaration of the “War on Poverty,” homeless children account for one out of every thirty children in the country. The number of homeless children increased eight percent between 2012 and 2013 and the total number rose by nearly one million between 2010 and 2013.

This devastating report comes in the sixth year of what President Barack Obama has repeatedly declared to be a great economic recovery. While there has been a recovery for those at the very top, as illustrated by the astronomical rise of the stock market, for most Americans, who have continued to experience a decline in living standards, there has been no recovery at all.

In a particularly nauseating speech delivered at the United Nations in September, Obama insisted that “this is the best time in human history to be born.” The report by the NCFH decisively refutes this ludicrous claim. Rather than the best time to be born, it is the worst of times for millions of children, as they and their families are forced out of their homes and onto the streets.

“Child homelessness has reached epidemic proportions in America,” said Dr. Carmela DeCandia, director of the NCFH. “Living in shelters, neighbors’ basements, cars, campgrounds, and worse, homeless children are the most invisible and neglected individuals in our society. Without decisive action now, the federal goal of ending child homelessness by 2020 will soon be out of reach,” she concluded.

According to the NCFH report, between the end of the Great Depression and the early 1980s, child homelessness was not a widespread or persistent problem. Child homelessness emerged as a significant and persistent social problem in the middle of the 1980s amidst the social counterrevolution inaugurated by the administration of Ronald Reagan.

Based on the latest federal and state data on child homelessness, including the US Department of Education’s annual count of homeless students in public schools and 2013 US Census data, the report singles out six major factors contributing to high rates of child homelessness. They are: the high national poverty rate; the lack of affordable housing; the continuing impacts of the Great Recession; racial disparities; the challenges of single parenting; and the impact of traumatic experiences on families, in particular, domestic violence.

With a child poverty rate of 19.9 percent in 2013, a large number of American children are living at significant risk of being homeless. Families headed by a single mother are particularly at risk, with more than one third of single mother households living in poverty. An estimated 45 million people lived at or below the federal poverty line in 2013.

Affordable housing is essentially nonexistent for the poor in the United States, putting the poorest of the poor at constant risk of homelessness. Nationally, there are only 30 units available for every 100 extremely low-income families seeking housing. Federal housing vouchers have been repeatedly slashed over the last decade, reducing the amount of assistance available for low-wage workers and the unemployed. Waiting lists for housing assistance average two years.

A 2013 study by the National Low Income Housing Coalition found that there was no state in the US where an individual working a 40-hour minimum-wage job could afford a two-bedroom apartment for his or her family.

Homelessness has been shown to damage the cognitive development of young children, further limiting their opportunities later in life. According to the NCFH report, the effects of trauma associated with homelessness may impair the development of a child’s brain structure, disrupting the ability to learn and blocking the development of social relationships, cognitive skills and emotional self-regulation. Approximately 25 percent of homeless preschool age children have serious mental health problems; this rises to 40 percent among homeless school age children.

The report utilized the broad McKinney-Vento definition of homelessness, which counts adults and children who are at any point in a given year without secure housing, in a temporary shelter, living out of a vehicle, squatting in abandoned buildings, residing in a motel, hotel or campground, doubling up with extended family members, or fleeing domestic violence.

The definition used by the report is much broader than the more limited Housing and Urban Development Department’s Point in Time study, which measures only the number of individuals sleeping outdoors or in homeless shelters on a single day at the beginning of a given year. The HUD count, which found 216,261 homeless family members at the beginning of 2013, left out hundreds of thousands of children and families in transitory shelter.

The NCFH report ranked states according to a composite of four criteria: extent of child homelessness; child wellbeing; risk for child homelessness; and state policy and planning efforts. While there is no part of the United States that is free from the scourge of child homelessness, the severity of the crisis varies by state and region. The states with the worst composite rating are located in the Southeast and Southwest, while those with the least onerous scores are concentrated in the Midwest and Northeast.

Minnesota had the “best” score with a population of 23,608 homeless children in 2013 and a child poverty rate of 14 percent. Alabama had the worst, with a population of 59,349 homeless children in 2013 and a child poverty rate of 27 percent. Last year in California, a staggering 525,000 children experienced homelessness, while 190,000 did in Texas, and nearly 140,000 in Florida.

Despite rising to historic levels, the issue of child homelessness was not once addressed during the midterm elections by the Democrats or Republicans. No new tranche of funding or emergency social program was proposed that would aim to eliminate the social crime of child poverty and homelessness. The callous indifference of Democrats and Republicans alike to the plight of the most vulnerable members of American society is not surprising, as they not only serve the interests of the rich, but are themselves in the wealthiest 10 percent of the country. The year 2012 marked the first time that a majority of congressional members had an average net worth of $1 million or more.

 

http://www.wsws.org/en/articles/2014/11/18/home-n18.html

Empty commitment by G20 to boost global growth

By Nick Beams
17 November 2014

The communiqué issued at the end of the G20 summit held in Brisbane, Australia, over the weekend stated that agreement had been reached among the participants, whose countries comprise 85 percent of the world economy, to boost global growth by an additional 2.1 percent over the next five years, or more than $2 trillion.

However, any serious examination of the state of global capitalism or even the communiqué itself and its associated documents makes clear the commitments will be honoured only in the breach.

Both the International Monetary Fund and the Organisation for Economic Co-operation and Development poured cold water on the goal, pointing to “the high degree of uncertainty in quantifying the impact of members’ policies.”

The G20 leaders met after a year in which an array of economic data pointed to the growing stagnation and outright recession in the world economy and the increasing risks of another financial crisis, the consequences of which would be even more devastating than those of 2008.

Moreover, the summit was held amid growing geo-political tensions, arising from the renewed US military actions in the Middle East and the sanctions imposed on Russia which are further worsening the global economic outlook.

The communiqué pledged G20 members to work in “partnership” to lift growth and boost economic resilience. But major participants, including British Prime Minister David Cameron, Canadian Prime Minister Stephen Harper, Australian Prime Minister Tony Abbott and US President Obama, lined up to denounce Russia and threaten further sanctions aimed at crippling its economy, the ninth largest in the world.

The contradiction between economic reality and the commitments to boost growth jump out from the very text of the communiqué.

It begins by stating that raising global growth to deliver better living standards and quality jobs for people across the world is “our highest priority.” However in same paragraph, after noting that global growth is not delivering the jobs needed and the economy is being held back by a shortfall in demand, it points to the persistence of risks, “including in financial markets and from geopolitical tensions.”

Not a small component in the shortfall in demand results from the program of austerity being implemented by all major governments as they claw back the debts incurred as a result of bailing out the financial system and banks following the global meltdown of 2008.

The risks to which it points arise from the actions of the major powers themselves. Dangers to financial markets arise from the collapse of the asset bubbles, reflected in the rise of US stock markets to a record high, which have been created by the actions of the world key central banks in placing trillions of dollars at virtually zero interest rates in the hands of banks and financial speculators.

The geo-political risks, in the Middle East and Eastern Europe, are rooted, above all, in the drive by the United States to use military and economic power in its drive to maintain its global hegemony.

The measures set out in the communiqué are themselves internally contradictory. On the one hand, it states that G20 members will “ensure our macroeconomic policies are appropriate to support growth, strengthen demand and promote global rebalancing.” However the next sentence states that they will strive to put “debt as a share of GDP on a sustainable path”—the code phrase for continuing spending cuts that drive down demand and lead to deflation and stagnation.

The summit adopted a Global Infrastructure Initiative, declaring that it “recognises that we are facing investment and infrastructure shortfalls in the global economy which will grow further if we do not act.” But there is no prospect of co-operation and collaboration in the development of such projects.

On the eve of the summit, the Obama administration heavily intervened to ensure the Australian government reversed its in-principle decision to become a founding member of the Chinese-based Asian Infrastructure Investment Bank on the grounds that roads, ports and other facilities financed by the bank would enhance Chinese military capacities in the region.

The focus of the G20 measures is not the boosting of economic growth but so-called structural reforms. These have two related aims: to reduce government regulations on the operations of businesses and to worsen conditions for workers, through so called “labour market flexibility.”

In his preview of the “growth plan,” Australian treasurer Joe Hockey said that as monetary policy and fiscal policy had reached their limits, the focus had to be on “structural reform.”

An article published in the Australian Financial Review on the eve of the summit, by Richard Goyder, the chief executive of the Australian corporation Westfarmers and head of the B20 group of business leaders, made clear what that would entail. He said there was “work to be done to encourage labour market flexibility” and “workforce adaptability.”

The type of measures to be adopted was indicated in the Australian commitment to the G20 plan. It included government proposals to charge higher fees for university education and to force young unemployed people to wait for up to six months before receiving any government benefits.

The complete absence of any sense of broad-based collaboration to lift the world economy was exemplified in the extremely crass remarks by Abbott to the leaders’ retreat held shortly before official proceedings began.

As the leader of the host nation, he said the task of the summit was to “instil more confidence in the people of the world.”

Abbott then began his own five-minute contribution to the discussion by declaring that his government has carried out its election commitment to stop refugee boats arriving in Australia and had repealed the tax imposed on carbon by the previous Labor government.

He went on to bewail the fact that as part of its so-called reform agenda the government had so far been unable to introduce a $7 co-payment for visits to a doctor or deregulate university fees.

While they were a particularly graphic display of narrow nationalism, if not parochialism, Abbott’s remarks were at the same time an expression of the agenda of all the summit participants. Their actions are not determined by the need for global co-operation but by the needs of their own national-state.

National interests were to the fore in the discussions on climate change. There was a redrafting of the final communiqué to include a recommendation for countries to commit funds to the United Nations Green Climate Fund after what were described as “difficult discussions” and even “trench warfare.”

The Abbott government has specifically opposed the fund, describing it as “socialism masquerading as environmentalism,” and the prime minister was reported to have made a passionate defence of the fossil fuel industry.

However, the United States is in a different position as result of the development of the shale gas industry. Consequently Obama was reported to have forcefully opposed Abbott on the question of coal and coal-fired power stations.

The dispute was an example of the conflicting national interests which render all the wordy commitments to co-operation and collaboration to lift the world economy a dead letter.

 

http://www.wsws.org/en/articles/2014/11/17/g20s-n17.html

Rising Inequality and Liberal Myopia

http://prophecypanicbutton.files.wordpress.com/2013/02/robber-barons.png?w=495&h=372

by PETE DOLACK

If capitalism is taking us back to feudalism, we’ll have to pass through the 19th century on our way. In terms of wealth inequality, we’re on course to return to the century of robber barons. Back then, the public-relations industry hadn’t developed, so at least they were called by an honest name, instead of “captains of industry” or “entrepreneurs” as they are today. Although “heir” would frequently be far more accurate than “entrepreneur.”

We’re not at the 19th century yet, but we have arrived at the 1920s on our trip to the past. The level of inequality of wealth in the United States today has not been seen since the decade that led to the Great Depression.

The top 0.1 percent — that is, the uppermost tenth of the 1% — have about as much wealth as the bottom 90 percent of United Statesians. To put it another way, approximately 320,000 people possess as much as do more than 280 million. It takes at least $20 million in assets to be among the top 0.1 percent, a total that is steadily rising.

Emmanuel Saez, an economics professor at the University of California, and Gabriel Zucman, a professor at the London School of Economics, examined income-tax data to reveal these numbers. They write that they combined that data with other sources to reach what they believe is the most accurate accounting of wealth distribution yet, one that shows inequality to be wider than previously imagined. The authors define wealth as “the current market value of all the assets owned by households net of all their debts,” including the values of retirement plans with the exception of unfunded defined-benefit pensions and Social Security. (The reason for that exclusion is that those moneys do not yet exist but are promises to be kept sometime in the future.)

The authors’ paper, “Wealth Equality in the United States since 1913: Evidence from Capitalized Income Data,” reports that, for the bottom 90 percent, there was no change in wealth from 1986 to 2012, while the wealth of the top 0.1 percent increased by more than five percent annually — the latter reaped half of total wealth accumulation.

The 22 percent of total wealth owned by the top 0.1 percent is almost equal to what that cohort owned at the peak of inequality in 1916 and 1929. Afterward, their total fell to as low as seven percent in 1978 but has been rising ever since. At the same time, the combined wealth of the bottom 90 percent rose from about 20 percent in the 1920s to a peak of 35 percent in the mid-1980s, but has been declining ever since. Although pension wealth has increased since then, Professors Saez and Zucman report, the increase in mortgage, consumer-credit and student debt has been greater.

Nonetheless, this might still be an underestimation — the authors write that they “still face limitations when measuring wealth inequality” because of the ability of the wealthy to hide assets off shore or park them in trusts and foundations.

Inequality on the rise

Although rising throughout the developing world, inequality is particularly acute in the United States. Among the nearly three dozen countries that make up the Organisation for Economic Co-operation and Development, only three (Chile, Mexico and Turkey) have worse inequality than does the U.S., measured by the gini coefficient. The standard measure of inequality, the more unequal a country the closer it is to one on the gini scale of zero (everybody has the same) to one (one person has everything).

Of course, were we to measure inequality on a global scale, the results would be more revealing. Even the U.S. gini coefficient of 0.39 in 2012 pales in comparison to the global gini coefficient of 0.52 as calculated by the Conference Board of Canada. To put it another way, global inequality is comparable to the inequality within the world’s most unequal countries, such as South Africa or Uganda.

How to reverse this? Professors Saez and Zucman offer reforms that amount to a return to Keynesianism. They advocate “progressive wealth taxation,” [page 39] such as an estate tax; access to education; and “policies shifting bargaining power away from shareholders and management toward workers.” Such policies would surely be better than the austerity that has been on offer, but the authors’ wish that this can simply be willed into existence is quite divorced from capitalist reality.

Indeed, the authors go on to lament that one factor in stagnant incomes is that “many individuals … do not know how to invest optimally.” It is difficult to believe that these two learned economists are unaware of the relentless chicanery of the financial industry. How does one invest “optimally” in a rigged casino stacked against you?

The past is not the future

Fond wishes for the return of Keynesianism will not bring those days back. (And, of course, if you weren’t a white male those days weren’t necessarily golden anyway.) The Keynesian consensus of the mid-20th century was a product of a particular set of circumstances that no longer exist. Keynesianism then depended on an industrial base and market expansion. A repeat of history isn’t possible because the industrial base of the advanced capitalist countries has been hollowed out, transferred to low-wage developing countries, and there is almost no place remaining to which to expand. Moreover, capitalists who are saved by Keynesian spending programs amass enough power to later impose their preferred neoliberal policies.

Capitalists tolerated such policies because profits could be maintained through expansion of markets and social peace bought. This equilibrium, however, could only be temporary because the new financial center of capitalism, the U.S., possessed a towering economic dominance following World War II that could not last. When markets can’t be expanded at a rate sufficiently robust to maintain or increase profit margins, capitalists cease tolerating paying increased wages.

And, not least, the massive social movements of the 1930s, when communists, socialists and militant unions scared capitalists into granting concessions and prompted the Roosevelt administration to bring forth the New Deal, were a fresh memory. But the movements then settled for reforms, and once capitalists no longer felt pressure from social movements and their profit rates were increasingly squeezed, the turn to neoliberalism was the response.

Nobody decreed “We shall now have neoliberalism” and nobody can decree “We shall now have Keynesianism.” Capitalist market forces — once again, simply the aggregate interests of the most powerful industrialists and financiers — that are the product of relentless competitive pressures have led the world to its present state and the massive inequality that goes with it.

Even if mass social movements build to a point where they could force the imposition of Keynesian reforms, the reforms would eventually be taken back just as the reforms of the 20th century have been taken back. The massive effort to build and sustain movements capable of pushing back significantly against the tsunami of neoliberal austerity would be better mobilized toward a different economic system, one based on human need rather than private profit.

Reforming what is ultimately unreformable is Sisyphean. Going back to the mid-20th century Keynesian era, even were it possible, would be no more than a detour on the way to the 19th century. Building a better world beats nostalgia.

Pete Dolack writes the Systemic Disorder blog. He has been an activist with several groups.

http://www.counterpunch.org/2014/11/14/rising-inequality-and-liberal-myopia/