PNN - 11/9/14
Stacie-Lee Sherwood …..7:36pm
Special Guest Co-Host Amy Bernard
Jonathon Quartermen - WWALS - Sabal Trail Pipeline
Nathan Pim ……….……… Ft. Lauderdale Food Not Bombs
Keith Mc Henry…….………One of the Original Founders Food Not Bombs
David & Lynn Petrovich - Lifes in the Balance (Sheet)
1. Treasury Rewards Usury
TAMPA, Fla. -- The U.S. Treasury Department on Thursday praised a move, already panned by Sen. Elizabeth Warren (D-Mass.), to increase the amount of money the federal government pays its student loan contractors.
In a speech here to consumer rights advocates, Deputy Treasury Secretary Sarah Bloom Raskin said her colleagues at the Education Department had recently boosted the amounts paid to companies that handle borrowers’ monthly payments in hopes that better financial incentives will drive them to improve their customer service and work harder to help borrowers avoid costly loan defaults. These companies include Nelnet Inc. and Navient Corp., the former loan servicing arm of student loan giant Sallie Mae.
What Raskin neglected to mention Thursday is that taxpayers will fund a bump in pay for the student loan servicers even if their performance does not improve.
In September, under withering questioning from Warren, a top Education Department official conceded that the companies will get more money regardless of any changes they make to their operations. At the time, the senator was incredulous.
“Let me get this straight: You break the law. You don't follow the rules. You treat the borrowers badly," Warren said of the loan servicers. "And you all just renegotiated the contracts to make sure that across the portfolio, [loan servicers] are going to make a little more money if nothing changes?"
"The idea of the renegotiation was to help the borrowers, not to make the servicers richer," Warren told William Leith, chief business officer for the Education Department's Office of Federal Student Aid, which handles student loans.
With unpaid student debt approaching $1.3 trillion during an era of stagnant wages and low employment, federal agencies including the Consumer Financial Protection Bureau, Federal Reserve and Treasury Department have taken an increased interest in the potential fallout from educational loans. Private-sector advisers ranging from chief executives of banks to Wall Street’s top traders warn that rising loan balances could inhibit U.S. economic growth.
Some federal officials beyond the Education Department are concerned that inadequate loan servicing -- the process of working with borrowers to place them in appropriate repayment plans and collecting their monthly payments -- may be exacerbating the problem as Americans take longer and devote more of their earnings to repaying student loans. The more money that households devote to paying off student loans, the less they have to buy houses, start small businesses or save for retirement.
A recent survey by the Federal Reserve revealed that nearly half of Americans said they had to curb their spending last year in order to make payments on student loans. Survey respondents with student loans also were more likely to say they had avoided medical treatment because they couldn't afford it.
Citing borrowers’ complaints on Thursday, Raskin said the Education Department’s contractors have provided them with “inadequate” information on repayment options and failed to enroll them in federal repayment plans tailored to their income. The White House has championed the availability of income-based plans as one of the main ways the administration has aided middle-class households.
The Education Department's new contracts with the loan servicing companies that hiked their pay are a “useful step to shape and improve the incentives in student loan servicing and drive better borrower outcomes,” Raskin said.
Raskin’s hope contrasts with the approach favored by some Democratic lawmakers, consumer advocates, state colleges, student groups and organized labor, who all have complained about shoddy treatment of borrowers and pushed the department to penalize companies that violate borrowers’ rights.
Navient, the former Sallie Mae unit, came under particularly harsh criticism after the Justice Department in May accused the company of intentionally cheating some 60,000 active-duty troops out of roughly $60 million on their student loans, which included debts overseen by the Education Department. The company settled the allegations by agreeing to refund aggrieved troops. It neither admitted nor denied wrongdoing, and spokeswoman Patricia Christel declined to comment for this story.
In December, the Education Department told Warren that it had declined to levy any fines against Navient's former parent company related to its secret determinations that Sallie Mae over the previous decade had harmed borrowers and incorrectly billed the government, among other servicing failures. At the time, the department dismissed those various findings as “compliance issues."
But as a result of the contract change praised by Raskin, Navient could receive an additional 15 percent in annual revenue from taxpayers, according to an estimate that Michael Tarkan, an analyst at Washington-based Compass Point Research & Trading, made in a September report to clients. The Education Department also recently rewarded Navient with more taxpayer-provided business despite the Justice Department accusations.
“I do not understand a basic renegotiation that says you can continue breaking the law, but we're going to pay you more money for doing it,” Warren said in September during her exchange with Leith of the Education Department.
A few weeks after that exchange, during the second of three speeches she has delivered since April focused on student debt, Raskin said there is a “great deal of integrity and stability in the student loan market.”
After listening to Raskin’s speech on Thursday, Joshua R.I. Cohen, a lawyer who represents borrowers with student loans, said he had to bite his tongue to avoid laughing during her remarks.
While Raskin detailed how the Obama administration had attempted to fix problems in student loan servicing and suggested there would be “rigorous” enforcement to ensure borrowers aren’t mistreated, Cohen said, only one thought popped into his mind: “How can you say that when Navient is getting rewarded?”
2. What if your NOT TOO BIG for HARSH JUSTICE?
American courts routinely hand down harsh sentences to individual convicts, but a very different standard of justice applies to corporations. Too Big to Jail takes readers into a complex, compromised world of backroom deals, for an unprecedented look at what happens when criminal charges are brought against a major company in the United States.
Federal prosecutors benefit from expansive statutes that allow an entire firm to be held liable for a crime by a single employee. But when prosecutors target the Goliaths of the corporate world, they find themselves at a huge disadvantage. The government that bailed out corporations considered too economically important to fail also negotiates settlements permitting giant firms to avoid the consequences of criminal convictions. Presenting detailed data from more than a decade of federal cases, Brandon Garrett reveals a pattern of negotiation and settlement in which prosecutors demand admissions of wrongdoing, impose penalties, and require structural reforms. However, those reforms are usually vaguely defined. Many companies pay no criminal fine, and even the biggest blockbuster payments are often greatly reduced. While companies must cooperate in the investigations, high-level employees tend to get off scot-free.
The practical reality is that when prosecutors face Hydra-headed corporate defendants prepared to spend hundreds of millions on lawyers, such agreements may be the only way to get any result at all. Too Big to Jail describes concrete ways to improve corporate law enforcement by insisting on more stringent prosecution agreements, ongoing judicial review, and greater transparency.
3. 1500 more troops above the WATERLINE - CLG
Obama authorizes 1,500 more troops for Iraq, asks Congress for $5.6 billion toward war [I wonder if the 5.6bn will be used toward the Pentagon's food and weapons drops for I-CIA-SIS fighters?] 7 Nov 2014 President Barack Obama is authorizing the U.S. military to deploy up to 1,500 more troops to Iraq as part of the mission to 'combat' the Islamic State group. The White House says the troops won't serve in a combat role [!?!], but will train, advise and assist Iraqi military and Kurdish forces fighting IS. The announcement is part of a 5.6 billion funding request to Congress and came just after Obama met with congressional leaders Friday.
4. Forcing US Muslims - CLG
U.S. Muslim leaders say FBI pressuring people to become informants 3 Nov 2014 Muslim leaders nationwide say the FBI is pressuring some Islamic community members and religious leaders to spy on fellow Muslims as part of a government effort to combat extremist recruiting in the U.S. The campaign has intensified in recent weeks, with mosques in California, Texas, Minnesota, Ohio, Florida and other states reporting unannounced visits by FBI agents, according to the Council on American-Islamic Relations, or CAIR, the nation's largest Muslim civil rights and advocacy organization. In a nationwide alert, the group urged mosque and community leaders to seek the advice of an attorney if they are approached by the FBI for questioning. They worried that the civil rights of numerous imams were being violated as the religious leaders were asked to meet with FBI agents, who then pressed them to inform on members of their congregations.
5 Nov 2014 The first of four sets of spent nuclear fuel rods has been removed from a damaged reactor building at Japan's Fukushima power plant, scoring a major success in an effort to dismantle the wrecked facility. The 1,331 spent fuel rod assemblies weighting some 400 tons have been recovered from the upper levels of the Reactor 4 building after a year-long operation, a spokeswoman for Fukushima operator TEPCO reported on Wednesday. The last 11 assemblies were removed on Tuesday. The recovered assemblies were placed in a storage pool at ground level of the plant, the company said.
6. FNB - SANTA CRUZ FOOD NOT BOMBS SHARES IN SOLIDARITY WITH THOSE BEING ARRESTED IN FLORIDA FOR FEEDING THE HUNGRY
Saturday, November 8, 2014 at 4:00 PM
Downtown Post Office Santa Cruz
“The city is choking out every avenue for the homeless to survive,”
Haylee Becker of the Food Not Bombs advocacy group told the South
Florida Sun-Sentinel. “They’re all terrible ordinances, but together
they’re a death sentence.”
Food Not Bombs volunteers arrested feeding the hungry in Ft Lauderdale.
Solidarity action in Santa Cruz Saturday at 4:00 PM at the Downtown Post
Office Six people are facing 60 days in jail and a $500 fine for
sharing food with the hungry.
No one should be arrested for helping the community. Sharing food is an
unregulated act of compassion. Santa Cruz Food Not Bombs will be sharing
vegan meals Saturday, November 8, 2014 at 4:00 PM outside the Downtown
Post Office in solidarity with those being arrested in Fort Lauderdale,
Florida. Many other cities are also passing laws banning or restricting
the sharing of food with the hungry in public at a time when poverty is
on the increase and social services are decreasing.
A few days after the Republicans won a majority in the House and
Senate President Barack Obama went to Congress seeking $4.14 billion
more to fight the Islamic State and accounted he is sending up to 1,500
more troops to Iraq. President Obama signed $8.7 billion food stamp cut
into law in February 2014 impacting millions of families at a time when
food costs are increasing.
At the same time cities across the United States are attempting to stop
the sharing for meals with the hungry in public in what appears to be an
attempt to reduce pressure to fund programs that would end hunger and
poverty. American's seeing long lines of hungry people could cause them
to wonder how there is always money for wars but never funding to
address the countries crisis of poverty and hunger.
During the past year authorities have tried to disrupt the sharing of
food with the hungry in public in nearly 60 US communities including
Fort Lauderdale, Worcester, Sacramento, Olympia, Taos, Boulder, Raleigh,
Portland, Philadelphia, Seattle, Saint Louis, Santa Monica, Houston,
Birmingham, Los Angeles, Columbia and Chico.
Volunteers are organizing solidarity events in cities all over the world
in support of those being arrested in Fort Lauderdale.
7.FROM SABAL TRAIL PIPELINE - WEBSITE
Lessons from New York
Spectra Energy’s track record leaves a negative brand image across many states and in Canada.3
In New York, for example, based on experience with Spectra Energy pipelines, Clare Donohue, a founding member of the Sane Energy Project, told this writer (emphasis added):
“It's apparent that Spectra is enlarging and adding to their east coast network from south to north, all aimed at improving their distribution to planned export terminals in Sable Island, Nova Scotia.
“These connected projects are being illegally segmented for separate review by the Federal Energy Regulatory Commission (FERC). Community resistance is intense all along the path, from Florida to Georgia to New Jersey, New York and Connecticut.
“FERC should review the Spectra system as a whole….
“FERC and the Department of Energy also need to LISTEN to citizens, who are sending a message loud and clear that these projects are NOT a ‘public convenience.’ In fact they are viewed as being shoved down the throat of community after community, and are of benefit only to the corporation itself.” Website: http://saneenergyproject.org/
Action in Georgia & Florida
Property owners in Georgia and Florida quickly combined their forces to challenge Spectra Energy and FERC. Their objections range from safety to property rights to challenging the necessity for the pipeline.
Sandra Jones, a property owner in Moultrie, Georgia, ran the numbers and concluded in comments to FERC (emphasis added):4
“There is no need for this new pipeline. Sabal Trail is misrepresenting the truth. In a state where there are only 9,031,051 households, why is enough natural gas needed to produce power for over 22,000,000 households needed? These figures only represent the three major [pipe]lines and do not consider the KinderMorgan line or other smaller ones also coming into the state.
“It becomes very obvious this natural gas is intended for exportation and will not benefit any of the citizens in Alabama, Georgia, or Florida if one looks at the business models of Spectra and NextEra Energies.”
8. TEST for PESTICIDE - "What me Worry?"
The U.S. Food and Drug Administration does not perform enough pesticide residue tests — on either imported or domestic foods – to say whether the American food supply is safe, according to federal auditors.
The Government Accountability Office report, which was released Thursday, said FDA is testing less than one-tenth of 1 percent of all imported fruits and vegetables and less than 1 percent of domestic fruits and vegetables. Federal auditors said the agency’s pesticide testing program is not “statistically valid,” making it impossible for it to meet one of its mandates, which is to “determine the national incidence and level of pesticide residues in the foods it regulates.”
The GAO, an investigative arm of Congress, also raised concerns about both the FDA’s and the U.S. Department of Agriculture’s decision not to test for many commonly-used pesticides for which the federal government has set strict residue limits. Auditors were critical of FDA and the USDA for failing to disclose this limitation in their annual reports.
USDA tests for pesticide residue in poultry, meat and processed egg products.
Although FDA and USDA are not legally required to test for specific pesticides, they are responsible for enforcing maximum residue limits that are set by the Environmental Protection Agency. When limits are violated, food products are subject to seizure.
The GAO review of the pesticide program was requested by Rep. Paul Tonko, (D-N.Y.), who said the results concerned him and urged the agencies to follow the recommendations of the federal auditors.
“GAO’s report indicates that the monitoring programs used by FDA and FSIS are falling short of their objectives. Improvements are needed in pesticide residue monitoring,” Tonko said, adding that both agencies “will need to devote more resources to pesticide residue monitoring to implement GAO’s recommendations.”
Tonko acknowledged that Congress will need to provide the “necessary resources” to the FDA and USDA if they want testing to be expanded.
Although the report did not criticize the USDA for its level of testing – and even noted that testing had risen in recent years – auditors did point out that testing rates were once higher. For example, from 2000 to 2009, the agency reduced the number of domestic and imported samples taken for testing from more than 8,000 annually to less than 1,900. But in 2010 and 2011, those annual samples increased to 2,100.
The GAO credited the department with engaging with “EPA on changes with (USDA’s) monitoring program to better provide EPA with data it needs to assess the risks of pesticides.”
In its response to the GAO, the FDA said it would consider creating a better testing model to ensure outcomes are “statistically significant” but it did not commit to doing so, citing cost concerns. The GAO doesn’t have the authority to order federal agencies to follow their recommendations.
Also, the FDA said it would not follow the GAO’s recommendation to disclose the names of pesticides that the agency fails to test for, because it said users could “more easily circumvent” the testing program if it did.
The USDA, which was also advised to begin disclosing the names of pesticides it does not test for, agreed to do so in its annual report.
The GAO said one of its greatest concerns with the annual reports is that although they indicate that residue levels are low and that violations are rare, auditors are concerned that this provides a false picture since the testing does not include many common pesticides.
9.Where Do Fracking Fluids Go? Scientists Create the First Detector
Despite the concerns about wastewater from hydraulic fracturing, it can be difficult to keep track of where the drilling fluids end up. Now a team of researchers claims to have figured out how to trace leaks and spills of fracking fluids—and even detect their presence in treated water.
The method, detailed in a study published in the journal Environmental Science & Technology, relies on identifying a specific combination of geochemical characteristics unique to fracking wastewater. “There’s a particular chemical signature we look for,” explains Nathaniel Warner, postdoctoral fellow at Dartmouth College and lead author of the study. That signature is independent of ingredients that make up fracking fluids, which vary and are often proprietary. Instead, it relies on elements that merge with the fracking fluids underground.
Fracking, as the name suggests, fractures rock formations deep below the surface of the earth to stimulate the flow of oil and gas, making it possible to recover greater volumes. Large quantities of fluids made from a mixture of fresh water and chemicals are injected into the ground at high pressure, eventually flowing back to the surface from the pressure below.
These so-called flowback fluids, which typically contain the injected chemicals as well as materials picked up underground, are notoriously difficult to trace. “In some cases, it’s also difficult to determine whether salinity or contamination of shallow fresh water might have been from the most recent hydraulic fracturing or whether it’s associated with this historical development,” says Warner.
To solve the problem, Warner and his team began thinking about what might be different about hydraulic fracturing flowback fluid and found that it contains much higher concentrations of boron and lithium. “When you’re injecting these fluids into the rock formations, you’re breaking apart the shales, and attached to a lot of these shales are boron and lithium,” he says. “We believe [the fluids] pick off that boron and lithium.”
To test for fracking fluids, Warner’s team tests for specific isotope ratios of boron and lithium, as well as elemental ratios of lithium to chloride and and boron to chloride. The team tested their method on 39 samples in Pennsylvania and Arkansas and at a spill site in West Virginia. The method worked even for detecting flowback water that had been treated at a municipal treatment plant. The next step will be to test samples at other basins.
Warner hopes the method will eventually be adopted by regulators and anyone looking to identify the origins of pollution. “Regulators could say, for example, ‘Hey, we have this data, and the spill appears to be associated with hydraulic fracturing fluids, not historic oil and gas production.’ ”
Risks of contamination, of course, will remain a problem.
10.FREEDOM - OFF THE HOOK - WVA GAZETTE
Freedom Industries said this week that it has agreed to a new deal with the West Virginia Department of Environmental Protection that could pave the way for it to get its Elk River facility into the state’s voluntary cleanup program, a move that could significantly ease its remediation work at the site of January’s chemical leak.
In a bankruptcy court filing, Freedom said it had “agreed to a final form” of a new consent order from the DEP that will allow the company to apply for acceptance into the Voluntary Remediation Program.
Enforcement orders issued by the DEP after the Jan. 9 leak mandated that “all” contaminated soil and groundwater at the site be cleaned up. The voluntary program would allow Freedom to use a “risk-based” approach and clean up only all soil or groundwater containing contamination above a certain concentration.
“Freedom submits that the non-detect standard for MCHM is not practical nor scientifically possible,” Freedom said in a report filed Wednesday with U.S. Bankruptcy Judge Ronald Pearson. “Freedom notes that established standards permit detectable levels of countless hazardous and/or toxic substances.”
DEP spokeswoman Kelley Gillenwater confirmed that a new deal with Freedom has “been agreed to in principle,” but said “it is still being evaluated and has not yet been signed.”
Acceptance in the program could result in Freedom having to meet less-stringent contamination standards than under existing DEP enforcement orders issued after the leak of MCHM and other chemicals that contaminated the drinking supply for hundreds of thousands of residents in Charleston and surrounding communities.
A few weeks after the leak, DEP Secretary Randy Huffman had said the Tomblin administration’s plans for the Freedom cleanup were pretty clear.
“I can say for certain that the state of West Virginia is not going to abandon that site or abandon the remediation efforts until there is 100-percent certainty that the risk of this stuff getting back in the water has been eliminated — not just minimized,” Huffman said. “I know what my boss is going to say about that, and I think I can make that statement. We just can’t have that possibility existing.”
For several months, DEP enforcement staff has been working on a possible new consent order that could lay out all of the requirements for existing orders issued to Freedom, as part of a process to determine if the agency and the company could reach a deal.
The problem for Freedom is that one condition of getting into the voluntary cleanup program is that state law says industrial sites are not allowed into the voluntary program if they are subject to any pending “unilateral enforcement orders for corrective action” from the DEP. A unilateral order is one the DEP issues on its own, as opposed to a settlement or consent order that a company agrees to in an enforcement case with the agency.
After the leak, the DEP issued at least three unilateral orders to Freedom regarding the Elk River site. The DEP and Freedom also agreed to a “consent order,” in which the company agreed to dismantle the chemical storage tanks at the site.
In a memo last month, DEP assistant chief inspector Joe Hickman noted that proposed cleanup plans being submitted to the agency by Freedom assumed that “further remedial activities will be driven by a risk-based strategy.” Hickman noted that existing DEP unilateral orders require a plan “to appropriately implement a remediation of all contaminated soil and/or groundwater” at the site.
“Essentially, this requires that the areas of contamination be located, defined, removed and cleanup confirmed,” Hickman wrote. “There is no provision for a risk-based remediation. If Freedom is successful in entering the VRP, the risk-based strategy may be acceptable there.”
Complicating the issue for the DEP and Freedom is that, with little scientific research about MCHM’s potential health effects, there are no established guidelines for proper cleanup of soil or groundwater.
Mark Welch, Freedom’s chief restructuring officer, said the company has been using a concentration of 600 parts per million as the level at which soil needs to be dug up and removed from the site. Welch said there is no “official” risk number and that the figure is based on his own “smell test.” He said, at that level, he “can smell the MCHM in the dirt.”
Welch said Freedom has removed 40 cubic yards of soil from the site in the past two weeks. Freedom told the bankruptcy court that tests are showing “non-migration” of MCHM beyond surface soil, but Welch said Thursday the company is finding soil with 200 to 300 parts per million in the area around where Tank 396 — from which the MCHM leaked — was located. Freedom’s instruments and test methods are able to detect down to parts per billion, Welch said.
“If I had to comply with non-detect, it would be impossible,” Welch said. “You can’t do it.”
Freedom told the court that if it is accepted into the DEP’s voluntary program, “very little, if any” additional cleanup work needs to be performed.
In its report to the court, Freedom said the company “continues to explore options for disposition of the facility,” but that “these efforts cannot truly be advanced until Freedom is accepted into the” voluntary cleanup program. “This is true because no party will agree to any involvement with the facility until the scope of ongoing environmental obligations, if any,” is determined by the DEP.
Gillenwater said Thursday that Freedom might be allowed to do the cleanup based on a risk-based approach if the site is accepted into the voluntary program. However, she said, DEP officials have stressed that the agency “is committed to making sure the risk to drinking water is eliminated.”
Reach Ken Ward Jr. at firstname.lastname@example.org, 304-348-1702 or follow @kenwardjr on Twitter.
- See more at: http://www.wvgazette.com/article/20141106/GZ01/141109485#sthash.pXSUfehP.dpuf
11. Lenders Can Now Disable Your Car When You're Driving on the Freeway
People with poor credit are being sold cars with GPS-based kill switches.
Imagine this scenario: You’re on an important trip miles from home and stopped in traffic, but before you can continue on your way, your car shuts down. You’ve got enough gas in the tank and no mechanical problems. But you’re stranded far from home because you’re a few days late on your car payment and the lender won’t let you drive until the debt is paid.
If this sounds like part of a dystopian future in which repo men are now cyborgs, it’s not. It’s happening today and becoming a big part of the new automotive landscape. Car dealers and automotive lenders are targeting those with poor credit by installing GPS-based kill switches, or starter-interrupt devices, on the cars that they sell.
The New York Times recently reported that about 2 million cars are now outfitted with such kill switches in the U.S., which is about one-quarter of subprime car loans, and creditors are not shy when it comes to remotely disabling cars whose owners are behind on their payments:
"Some borrowers say their cars were disabled when they were only a few days behind on their payments, leaving them stranded in dangerous neighborhoods. Others said their cars were shut down while idling at stoplights. Some described how they could not take their children to school or to doctor’s appointments. One woman in Nevada said her car was shut down while she was driving on the freeway.
"Beyond the ability to disable a vehicle, the devices have tracking capabilities that allow lenders and others to know the movements of borrowers, a major concern for privacy advocates. And the warnings the devices emit — beeps that become more persistent as the due date for the loan payment approaches — are seen by some borrowers as more degrading than helpful."
Subprime automotive-loan borrowers, those with FICO credit scores below 660, debt-to-income ratios of more than 50% or a bankruptcy in the past 60 months, are a growing segment of automotive borrowers. This phenomenon has been buoyed by auto dealers trying to continue a strong sales rebound after years of weak sales and by securities investors who buy bonds backed by those loans and see them as a way to get ample returns when other interest rates remain low.
In a healthy economy, buying subprime securities can be a lucrative way to exploit those who are still struggling with debt, but still may be able to find work and earn a decent wage. But when the economy goes soft, so do the subprime markets, as lenders become wary of taking on large credit risks. As the economy weakened in 2007, and the subprime mortgage securities market became unstable, it resulted in the U.S. credit crisis which, in turn, fueled the deep recession between 2007 and 2009.
But in this lukewarm recovery, investors are bullish on at least one subprime loan market. While foreclosed homes have proven nearly impossible to resell during hard times, used cars still sell relatively well even during a deep recession, providing ample collateral for these subprime loans.
Still, investors are skittish because they’re aware that car loans are not as well vetted as mortgage loans. The success of the auto dealer model is to let buyers come in, pick out a car, and complete the financing in one day.
Burned by subprime securities in the past and worried that car-loan applicants are not as thoroughly scrutinized as home buyers, investors need to be assured they’re not throwing good money after bad, and that’s where starter-interrupt systems (sometimes euphemistically called payment assurance devices) come in. They force borrowers either to pay the debt in full or face having the car sit idle for weeks or even months until it is eventually repossessed and resold. The theory is that when making a car payment is as essential as putting gas in the car, people will be more likely to make their payments.
But starter-interrupt devices and reselling repossessed cars might still be more than an economic placebo than a panacea for investors. Critics caution that packaging such loans into securities is still very risky business. Writing for Vox, executive editor Matthew Yglesias rationalized his skepticism by saying, “returning to the idea of lending people money so they can buy more stuff than their wages will support isn't going to solve anything.”
Bad Credit? No Problem!
While Wall Street is once again exploiting those with dubious credit by trading bonds based on loans that are engineered for high return, lenders and bondholders are wary of being caught flat-footed the way they were during the housing crisis. They’re seeking ways to mitigate the risk that devastated the economy after the housing bubble.
Financial analysts say about a quarter of all automotive loans are subprime, and expect that number to climb as consumer debt continues to rise. These loans can be highly lucrative for lenders, with interest rates that can be well over 20%. Many of these subprime auto payments often come in late, bringing in late fees as well. Nearly 4% of all subprime auto loans are more than 60 days late, up by 3% from 2013.
Bloomberg BusinessWeek reports that investment rating companies are bestowing top grades for bonds based on subprime auto loans, but some critics say that investors can’t easily figure the real risks.
“Investors are basically taking the issuer’s word that they follow certain procedures,” Eugene Grinberg, a former analyst who structured subprime auto securities told BusinessWeek. “There is opportunity for fraud.”
So it’s likely, to calm worried investors, the bundlers of these securities are trying to mitigate their risk by encouraging retail lenders to have the starter-interrupt devices installed.
Public Service or Public Exploited?
Lenders are quick to justify the starter-interrupt systems, saying that without them, hundreds of thousands of automotive loans would not be possible and it allows many more people the freedom of car ownership than would otherwise be possible. The makers of the starter-interrupt devices say they help keep borrowers up to date on their loans. One device maker told the New York Times that late payments have fallen to about 7%, down from 29%. Furthermore, many lenders say they’re aware that borrowers may, for various reasons, be late with payments and they claim they make calls to borrowers well before they make the decision to disable their cars.
Dealer organizations claim theircustomers don’t balk when they’re told that a GPS starter-interrupt device will be installed on the car. Some dealers even claim the devices actually help car buyers get better loan terms and improve their credit ratings.
Tom Nyitrai, a New York car dealer, recently told a Buffalo television station that 90% of the cars he sells have starter-interrupt devices installed on them.
“Yes the GPS unit can typically help the customer get a lower down payment, lower monthly payments, lower interest rate because the bank considers the risk in that loan to be lower," Nyitrai told WIVB News 4. “This unit obviously is an extra incentive to make sure your payment is done on time, and as long as you do that, you do improve your credit score.”
The National Alliance Survey says starter-interrupt systems disable 14% of cars immediately when the payment day is missed, while 30% of consumers are provided with a short grace period. About 54% of lenders use discretion with the systems, while another 1% report only using them as a threat.
But borrowers tell a different story. Many have told various media outlets that their cars have been shut off without warning, leaving them in a lurch or in danger. The St. Louis Post-Dispatch reports that cars have been disabled even when owners are current with payments.
Passtime, the Colorado company that makes many of the GPS starter-interrupt devices told the Post-Dispatch it's not heartless; it's given consumers remotes that give them a 24-hour reprieve if their car is ever shut down.
“We never want anyone to be stranded,” says Passtime CEO Stan Schwarz.
While most states approve of the use of starter-interrupt device, California allows them only at “Buy Here, Pay Here” dealers that make direct car loans to consumers. Wisconsin is the only state that bans them. As CBS MoneyWatch reports, the state’s Department of Financial Institutions says “the act of disabling a vehicle has the same result as taking possession of the vehicle” and that disabling a car before a creditor can legally take possession of the car represents "an improper repossession.”
So far, it seems that while starter-interrupt systems are not very consumer friendly, they are friendly to those who hold their debt. And the idea might be catching on elsewhere. Marc Rotenberg, president of the Electronic Privacy Information Center, sees their success inspiring similar devices for the real estate industry. He recently told NPR that the same payment assurance technology is now being used by landlords, who can remotely keep renters out of their apartments if they fall behind on their rent.
"That's where I think it's going to get really interesting," Rotenberg told NPR.
12. Florida Cop Breaks 14-Year-Old Girl’s Arm During Warrantless Cell Phone Search
Florida parents are calling for a Greenacres Police Department officer to be fired after he reportedly broke their 14-year-old daughter’s arm while attempting a warrantless search of her cell phone.
According to an arrest report published by the Broward-Palm Beach New Times this week, Officer Jared Nash explained that he approached the 14-year-old girl at John I. Leonard High School on Oct. 21 because he believed that she had video of a fight on her cell phone.
Nash described the girl, who was talking on the cell phone, as “uncooperative.” He said that she pushed him back as she tried to get past him to walk away.
“When she did this I took a hold of her left arm,” he wrote, adding that he gave her a verbal command to “stop and put the phone down.”
“[She] then began to twist and pull her arm around in an increased physical level trying to pull away,” Nash explained. “I then tried placing [her] left hand behind her back to secure her in handcuffs due to her pushing me, her increasing attempts to break away from my grasp, and continuing to try hand the phone to [her friend] despite my orders not to.”
Nash took the girl into custody, but she later complained of pain and was taken to Palms West Hospital, but his report does not mention what she was treated for. She was eventually charged with resisting an officer without violence.
The girl’s father provided X-rays to blogger Davy V. showing multiple breaks in her arm.
The father said that Nash had only gone to the school because he had filed a police report about his daughter being bullied days earlier, and that his daughter had been uncooperative with the officer because she was on the phone with her mother when her arm was broken.
“We initiated a police report, and [the police] ended up causing more harm than anyone,” he pointed out.
He also said that the school had surveillance video of Nash breaking his daughter’s arm, but officials were refusing to release it.
“They have already admitted that there is a video, so they can’t go back now and say that there isn’t,” he told Davy V.
As for Nash, the father wants him removed from the force.
“They are saying that the officer’s excessive force was justified because they say my daughter pulled away from him,” Galindo noted. “So one of your officers breaks a minor’s arm and you don’t investigate?”
“I want him fired.”
Greenacres internal affairs spokesperson Lt. Brady Myers told the New Times that he could not comment on the case because an investigation was ongoing.
“You saw the pictures on the internet, didn’t you?” Myers replied when he was asked to confirm that the girl’s arm was broken.
The Supreme Court ruled earlier this year that police must have a warrant to search cell phones and other personal electronic devices.
The arrest report is embedded below via the New Times.
Food Not Bombs Ft. Lauderdale Collective
The group has been meeting in Stranahan Park every Friday at 5pm for the past four years and usually feeds around 40 people, many of them returning each week. The food is usually collected from various sources, oftentimes donated by local coffee shops and markets, and occasionally purchased. Using what would otherwise be thrown out in the community is the objective, therefore purchasing food is a last resort and rarely necessary. Cooking and cleaning up are collective efforts. According to FNB Ft Lauderdale member Hunter, “Food Not Bombs Ft Lauderdale usually gets so much local support and help that we don’t really need to assign turns of who cooks when.”
Because anyone, anywhere can start a FNB chapter, there are only a loose set of principles to guide each group, allowing members to devote their time and passion to what areas they deem most important. As foodnotbombs.net states,
“There are several reasons why this movement is still so strong after 30 years. Food Not Bombs has no leaders, directors and each chapter is autonomous, making decisions involving everyone in the group using the process of consensus. It is very empowering to collect, prepare and share free food, all on your own and to do it with little money, and few resources. Sharing food is powerful and magical. Additionally, when average people realize they have the power to make a difference, it can change their lives.”
In addition to food sharing, FNB Ft Lauderdale organizes and participates in other events and demonstrations for their cause almost weekly. Other efforts include workshops, infoshops, and protests addressing topics such as anti-authoritarianism, feminism, animal rights, and environmentalism.
hear me talk about the many troubles our endangered sea turtles are facing from lights on the beach to the newly proposed oil drilling off the east coast and siesmic testing. These will have a huge negative impact on all marine life and human life as well and are crucial issues to learn about and help us stop.
Food Not Bombs is a grassroots movement dedicated to protesting war and poverty through demonstrations and feeding our homeless. For 30 years now, chapters in over a thousand cities meet weekly to offer free, vegetarian or vegan meals to the public. This past Friday, Food Not Bombs Ft Lauderdale honored the 30th anniversary with a Really, Really Free Market, banners, information, and food.
PNN - 11/9 - Turtles, Pipelines & $ Troubles
Join News Director Rick Spisak as he welcomes his guests
Staci-lee Sherwood who has been working on protecting Florida's Turtles from a variety of challenges human and otherwise
And Environmentalist John Quarterman President of the WWALS Watershed Coalition will discuss the Sable Trail Pipeline
And a very special pair of guests Lynn and David Petrovich hosts of a new upcoming Finance/Credit Revolution show called
"Lives in the (Balance Sheet)" - Dave and Lynn have an extensive activist portfolio - Medicare For All (NJ) + CPAs For Community Support + Green Party of Monmouth & Central NJ + (democratic) Socialist Party of Central NJ + People For A New Society (PFANS) + New Progressive Alliance - NJ + Society For Preservation of Continued Homeownership aka SPOCH (a NJ NP 501c3 Corporation)
They address the issues of credit, student loans taxation and how to maximize your economic power in a RIGGED GAME
And of course as always we'll start with some headlines and you can find the details at www.AveryVoice.com
Tune in Sunday 7pm Live or Anytime