I wish everyone would watch this and read this. It is unthinkable that women will be denied the ability to get an abortion, and even more unthinkable that a Democratic president will sign the bill if it passes, but it sure looks like it’s about to happen. Bipartisanship!
WASHINGTON — Economists at the New York Federal Reserve have concluded that a controversial 2005 law backed by banks and credit card companies pushed more than 200,000 people into foreclosure and exacerbated the subprime mortgage crisis.
Consumer advocates fought hard against the law, which made it much more difficult for individuals to alleviate credit card debt in bankruptcy. This inability of homeowners to eliminate other debts, the New York Fed economists conclude, in turn made borrowers unable to pay off their mortgages, spurring foreclosures.
Despite opposition from public interest groups, the 2005 law easily cleared both chambers of Congress and was signed into law by President George W. Bush. In a paper released Tuesday, New York Fed researchers Donald P. Morgan, Benjamin Iverson and Matthew Botsch determined that the law sparked about 116,000 additional subprime mortgage foreclosures a year after going into effect.
What’s more, they note, these foreclosures pushed home prices down, which may have lead to additional foreclosures. When the value of a home drops below what a borrower owes on the mortgage, it becomes nearly impossible to get out of the loan by selling the house or refinancing, making foreclosure more likely if they become unable to afford the monthly payment.
“By making it harder for borrowers to avoid paying credit card debt, [the 2005 bankruptcy law] made it more difficult for them to pay their mortgages, so foreclosure rates rose,” the economists wrote.
Although borrowers have been unable to alleviate mortgage debt in bankruptcy since 1993, they remain able to discharge credit card debts by filing for bankruptcy. But the 2005 law made it much more difficult for consumers to file for bankruptcy at all — and then limited their ability to reduce credit card debt burdens once they did.
In Egypt. They’re not going away, no matter how many “hints” the torturer in chief drops.
You should watch this great Anderson Cooper video:
Someone isn’t taking the class war lying down. Good for Mr. Katz!
At last count, Steven Katz owed $80,000 on his six credit cards, and he has no intention of paying any of it off. In fact, he’d like to show you how to be like him—a “credit terrorist” in open revolt against the banking system.
Katz is the founder of Debtorboards.com (“Sue Your Creditor and Win!”), a five-year-old online forum where he’s collected countless tricks and tactics for evading and repelling persistent creditors. He’s written how-tos on shielding your assets from seizure, luring collection agenciesinto expensive lawsuits, and frustrating private investigators looking for debtors on the run. He’s even infiltrated the bill collectors’ forums, where he’s been tagged a “credit jihadist” and his site’s been called a “credit terrorist training camp,” a label he embraces. “Debtorboards is one of the biggest and most successful temper tantrums ever,” the 59-year-old Katz boasts. The site has more than 10,000 members—double what it had in 2009.
Katz wants the millions of Americans buried in debt to stop feeling guilty about not honoring their obligations. “People are brainwashed to think that paying a credit card is more important than paying for the necessities of life,” he says. “Business and morality have nothing to do with each other, according to the bankers.” One of Katz’s mottos is “No one ever went to hell for not paying a debt.”
He wasn’t always an unrepentant debtor. When he first spoke to me from his tax and accounting business in a strip mall in Tucson, Arizona, he recalled how his first job in the ’70s was tromping through Brooklyn making collections for a small loan company. He once threatened to take a woman’s kids to an orphanage if she didn’t pay her bills. He wasn’t serious, but it worked.
The tables were turned in 2003, when a collection agency came after Katz for a debt that had been written off when he declared bankruptcy a few years earlier. The collector wouldn’t relent, and Katz’s credit score tanked. Outraged, he turned to the internet, where he learned how to go after debt collectors for violating consumer protection laws. Eventually, the collector paid him $1,000 in damages. Katz framed the check with the caption “The Steven Katz school of bill collector education is now open for business.”
His tactics may be extreme, but Katz is not alone in his quest to evade the banking system. More Americans than ever are unable—or unwilling—to make good on their debts. Since 2008, banks have “charged off” a record $90 billion in credit card debt—taking it off their books as unlikely to ever be repaid. In the past two years, major banks charged off more than 10 percent of all consumer credit card accounts, on average—two times the pre-recession rate, and the highest in US history. The number of consumer lawsuits filed against collectors, like those Debtorboards encourages, has grown 122 percent since 2008. A backlash against the big banks is ballooning—from the California woman who made a popular YouTube video urging people to stop paying their credit card bills as part of a “debtors’ revolution” to the “Move Your Money” campaign, which encourages consumers to move their money to local banks or credit unions.
Blocked in the house. It will pass eventually, I’m sure, but nice to see some Congress members take a stand.
I got turned down again for the Media Matters’ Progressive Training Initiative, in which they give people media training to be progressive spokespeople. This is the fourth time; I’m beginning to feel like Susan Lucci.
Actually, I did get invited to the one they had in Vegas last year — but I couldn’t afford to fly there. Oh well!