SLABS: How to make money off someone else’s private student loan

SLABS

SLABs, and no we aren’t talking about the stuff of which patios are made, or the tiles that can be laid on kitchen floors. Nor, are we talking about some Silicon Valley laboratory firm.  Let’s focus on Student Loan Asset Based securities.  Yep, “securitized” assets – like mortgages, auto loans, credit card receivables, etc.  We do remember the mortgage thing? Right?

SLABs were hot in 2013. [WSJ]  In fact, see if you can make sense of the following description:

“Student loans are souring at a growing rate—and investors can’t seem to get enough. SLM Corp., the largest U.S. student lender, last week sold $1.1 billion of securities backed by private student loans. Demand for the riskiest bunch—those that will lose money first if the loans go bad—was 15 times greater than the supply, people familiar with the deal said.” [WSJ]

Why would investors be banging on the doors for those loans which are the most likely to go into default?  I think we’ve seen this movie before, and the ending (2007 – 2008) wasn’t pleasant for anyone.

The Basic Materials

Once upon a time Sallie Mae or SLM, was a government sponsored lending firm specializing in student or educational loans.  That was the case until 2004 when Sallie Mae went private and it’s now a publicly traded private sector corporation. SLM securitizes private education loan by selling them to the SMB Private Education Loan Trusts. The Loan Trusts (2014 and 2015) show “issuance details” online (here’s 2014-A)  There was $382 million in the August 7, 2014 records; divided into five categories with varying rates of return. Scrolling down we find the ‘master servicer’ as Sallie Mae Bank, the sub-servicer as Navient Solutions, Inc., the indentured trustee being Deutsche Bank National Trust Company, and the underwriters Credit Suisse and the Royal Bank of Scotland. [SLM]   Navient Solutions, Inc. is simply the name adopted in 2014 for Sallie Mae’s loan management, servicing, and asset recovery operation. [Bloomberg]  An ‘indentured trustee’ is:

“A financial institution with trust powers, such as a commercial bank or trust company, that is given fiduciary powers by a bond issuer to enforce the terms of a bond indenture. An indenture is a contract between a bond issuer and a bond holder. A trustee sees that bond interest payments are made as scheduled, and protects the interests of the bondholders if the issuer defaults.” [Investopedia]

The underwriters, in this instance Credit Suisse and RBS, are the firms which act as sales personnel for the bonds bases on securitized private student loans.  So, we have SLM issuing the bonds, Deutsche Bank National Trust acting as the agency responsible for bond registration, transfer, and payment of bonds, while Credit Suisse and RBS are the ones selling the bonds.   Sounds impressive, however those private loans comprise only about 8% of the total student loan market – the remaining 92% are Federal Stafford and PLUS program loans.  But – the numbers are still sufficiently high to interest SLM, Deutsche Bank, Credit Suisse and RBS, because there’s about $92 billion involved in the private student loan market. [PSL]

Slabs without much mortar

Recall for the moment what got Wall Street in major trouble during the Housing Bubble.  Investment firms issued bonds, and then played with derivatives based on those mortgage based bonds, without being all that sure the loans were going to be paid off.  Thus, it was extremely difficult, and in some instances impossible, to calculate what the bonds were actually worth. Enter the credit rating agencies who (for a nice fee) stamped AAA+++ on what should have been recognized as piles of garbage; the investors couldn’t get enough of these, so even more garbage piled up as the investment houses bet on whether or not the assets were worth anything.  Enough garbage was included in the piles of paper that the whole pillar of paper crashed.

What’s saving us from the prospect of another bubble of epic proportions is that the market in private student loans is very small – that $92 million is a drop in a very large bucket of corporate and commercial debt. [Atlantic]  Another bit of good news is that because of the Dodd-Frank Act there is more transparency required in dealings in asset based securities.  [SEC]  [WSJ] The bad news is that Republicans in Congress have been wailing for the repeal of the Dodd-Frank Act as “burdensome regulation” of the banking industry.  Or, “make the SEC back off and let us get back to trading asset based securities like we used to in the Good Old Days.”

Who’s holding up the scaffolding?

Another bit of bad news is that while lenders are looking for new customers (students willing to take on private loans) we’re not tracking some important information about those loans.  For example, the default rate for Harvard is less than 2%, while the default rate for the Arizona Automotive Institute is nearly 42%.  [Bloomberg] Interestingly enough, there’s a long list of for-profit educational institutions with default rates higher than 28%. What we don’t need to see are more for-profit training schools encouraging more private student loan debt, debt which someone somewhere hopes will be hedged with private loans more likely to be paid off – because at bottom the funds to pay investors have to come from students paying off the loans.

Don’t panic yet, yes – there’s a hungry market for student loan asset based securities (perhaps in part because some old Federally backed loans were in the pipeline originally) and the market is relatively small albeit subject to some of the valuation mistakes of the Old Investment Houses – the ones who went bust in 2007-2008.   There’s another reason for hope: The Consumer Financial Protection Bureau – the agency the Republicans can’t seem to wait to dismantle. [DB 7/30/14]

One of the provisions of the Dodd-Frank Act was the creation of an ombudsman for student loans which is part of the CFPB.  In the 2014 annual report (pdf)  it’s of interest to note that the biggest problem area was NOT repaying student loans but in getting financial institutions to cooperate with repayment programs and dealing with servicers and lenders (57%). If this sounds like a reprise from the Mortgage Meltdown Days it might be because some of the same actors are involved, at least in terms of complaint volume: JPMorganChase up 56% from 2013; Sallie Mae Navient up 48%; Wells Fargo up 8%.  The annual report indicates problems in the following areas: (1) There is no clear path to avoid default. (2) Proactive outreach from borrowers was too often unsuccessful. (3) When repayment options are made available they are too often too little too late. (4) In some cases repayment options were allowed only after the loan went into default. (5) Short term forbearance options were often associated with processing delays, unclear requirements, and unaffordable fees. (6) Many lenders force a choice between staying in school and repaying the loans.   There is a reason for the Ombudsman’s concern. The Sallie Mae Settlement.

The FDIC announced a settlement with Sallie Mae on May 13, 2014 in which Sallie Mae was charged with (1) inadequately disclosing its payment allocation methodologies to borrowers while allocating borrower payments across multiple loans in a manner that maximizes late fees; (2) misrepresenting and inadequately disclosing in its billing statements how borrowers could avoid late fees; (3) unfairly conditioning receipt of benefits under the SCRA upon requirements not found in the act; (4) improperly advising servicemembers that they must be deployed to receive benefits under the SCRA; and (5) failing to provide complete SCRA relief to servicemembers after having been put on notice of the borrowers’ active duty status.

The Structure

As long as the private student loan market remains a small part of the total structure we can breathe a bit easier about its effect on capital markets. Secondly, the private student loan market has relatively low yields and thus doesn’t get included in most structured derivatives.  Third, the old ‘recourse loans’ (for those with really low credit scores) are a thing of the past, most private loans now take higher scores into consideration. [QuoraWhat will continue to keep investors whole?

  • Continued monitoring of the private student loan market by the CFPB so that loans taken out will continue to be loans paid off, even if this means some reduction in the revenue streams for the bankers.
  • Continued oversight by the SEC and FDIC under the terms of the Dodd-Frank Act so that we don’t return to the Wall Street Casino of old should there be changes in the private student loan market.
  • Improvement in the servicing of private student loans such that there are clear pathways to avoid default; effective and efficient communication between borrower and lender regarding repayment options; and, that this communication happens in a timely manner.
  • Requiring lenders to make all the term of the private student loan clear at the outset including forbearance conditions, and any and all fees associated with deference, late payments or defaults.

The Foundation

From a Wall Street perspective private student loan asset based securities are a niche market, with some revenue potential – enough to keep the big banks interested – however, not with enough total clout to cause major financial displacement should the Quake happen.  And yes, there are some institutions making nice fees for making student loans, selling student loans, securitizing student loans, servicing student loans, and collecting payments on student loans.  Capitalism works, the trick is to keep free market capitalism from becoming casino capitalism and/or financialism.

A more existential question is how to maintain a system in which students are burdened with so much debt (Federal program/Private loan program) that they are deferring consumer purchases which would contribute to the growth of the overall economy.  Deferred student loans can impact mortgage qualifications. [credit.com]  We know this because the  rate of homeownership among those with student debt is 36% below that of unencumbered home buyers, and we’re losing about $6 billion annually in new car buying capacity.  [Forbes]  And, this is not an inconsequential problem:

“Student loan debt is the only form of consumer debt that has grown since the peak of consumer debt in 2008. Balances of student loans have eclipsed both auto loans and credit cards, making student loan debt the largest form of consumer debt outside of mortgages.” [NYFed]

Given some of the trends reported by the NY Federal Reserve’s study of educational loans, how do we make sense of an economic system in which wages and salaries are stagnant while it is taking those from lower and middle income backgrounds longer to repay student loans?  How do we sustain an economy when 29% of borrowers are paying off their loans, while 34% are making regular payments but the balance is increasing, and 20% have reported credit related problems, with another 6% delinquent and 11% in default?

These are not simply economic issues, they are also political as well. Is there the political will to make post secondary education more affordable for more people?  Are we headed toward the privatization of our public institutions of higher education and post secondary training, and is this trend combined with the rising level of student indebtedness creating cracks in our economic foundations?

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Grand Old Ivy Gets More Expensive

Grand Old Ivy

When Shepherd Mead published “How to Succeed in Business Without Really Trying” in 1952 tuition at Harvard University was $600.00.  When the Loesser & Burrows musical rendition was produced on Broadway in 1961 Harvard tuition was about $2,370, and the tuition for a four year public institution was about $1825.00.

As the following chart demonstrates it was a whole lot easier to sing the Alma Mater 50  years ago than it is for middle income students today:

Tuition increases chartNote that the precipitous climb begins around 1984.   One factor involved in this fiscal situation is that from FY 1980 to FY 2011, with only two exceptions (Wyoming, North Dakota) all the states have reduced their financial support in a range from 14.8% to 69.4%. Colorado reduced support by 69.4%, South Carolina by 66.8%, Rhode Island by 62.1%, Arizona by 61.9%, Oregon by 61.5%, Minnesota by 55.8%, Virginia by 53.6%, and Vermont by 51.3%.  [ACEnet]

The Bottom Line: “Based on the trends since 1980, average state fiscal support for higher education will reach zero by 2059, although it could happen much sooner in some states and later in others. Public higher education is gradually being privatized.” [ACEnet]

“Down At the Bottom of the Heap, Where The Mud Is So Very Very Deep”

There are various and sundry explanations for this, and most critics start by contending that without showing inflation adjusted amounts the argument can’t be made that state support has been dwindling, or in some cases spiraling downward.  This would be a valid argument except that when inflation adjusted figures are used the results are essentially the same. [ChronHE]  State support is dropping and tuition and fees are increasing.

The next common refrain from the privatizers is that the universities are full of “administration bloat.”  This, too, fades when the numbers are crunched.  There’s a chart for that too:

College Admin What the actual numbers show is that for research universities what’s increased is the category of part time faculty. What’s decreased is the category including “executives and administrators.”  The same holds true for non-research based institutions. [Demos]  A rational explanation for the increase in professional positions might be found in additional numbers of individuals involved in information technologies, health care services, and security services.

One of the more self-serving arguments is that if you give students more student aid, the colleges and universities will simply raise their tuition to absorb more of the financial benefits.  This notion was popularized by Reagan appointee William Bennett, and while it’s been debunked almost entirely since, it’s an argument which simply won’t disappear.  The GAO was the most recent research to debunk the Bennett Hypothesis:

“The most recent, conducted by the Government Accountability Office (GAO) in 2011, took advantage of a unique “natural experiment” to test the Bennett hypothesis: the substantial increases in Stafford Loan limits between 2007 and 2009.22 In 2007, the yearly loan limits, adjusted for inflation, ranged from $2,925 for freshmen to $6,125 for upper classmen. By 2009, they had risen to $5,750 and $7,825, respectively. All told, the yearly borrowing limit for all undergraduates increased by an average of $2,340. However, average tuition at public 4-year universities rose by just $540 over the same two years, in line with recent historical averages, leading the GAO to reject the possibility of a relationship between the two. Additionally, these increases in borrowing limits were the first since 1993, meaning that the inflation-adjusted value of the limit had declined for more than a decade during which tuitions rose steadily. All told, both the empirical evidence and academic consensus deem the Bennett hypothesis false.” [Demos] [original GAO pdf]

Actually since the Demos Report there have been some more recent studies by the GAO.

The GAO looked at the possibility of increased tuition caused by the reforms made to the federal student loan programs and reported in February 2014: (pdf)

“Although college prices went up, we were unable to determine whether or not these increases resulted from the loan limit increases because of the interference of various economic factors occurring around the same time these loan limit increases went into effect. Specifically, when the loan limit increases went into effect, the nation was in a recession which created one of the most tumultuous and complex economic environments in recent history, affecting families’ employment, income, and net worth (see fig. 4). As shown earlier, the availability and types of federal and institutional financial aid available to students increased around the time the new loan limits went into effect (see table 1), also making it difficult to discern any effect those loan limits may have had. For example, the dollar amounts of Federal PLUS loans, federal tax benefits, Pell grants, and federal veterans grants all increased. Further, the amounts of state and institutional grants and loans also increased, while the amounts of state appropriations for colleges and college endowments decreased.”

In short, a direct cause and effect relationship cannot be discerned because there are simply too many other economic and demographic factors which have to be considered in the mix.  Not only is there not a way to establish causality, it isn’t possible to even propose a correlation.

Perhaps the most ear drum splitting whine from those who advocate for the eventual privatization of American public colleges and universities is the whinnying that those institutions are accepting people who “should never have gone to college in the first place.”  The inference is clear, these young people are a “waste.”  The American Enterprise Institute offers a softer, albeit more verbose, rendition of this complaint.

Brookings, more interested in BLS statistics on education and the labor force than in compiling survey based impressions of the value of education, offered this rejoinder:

“… it is indisputable that workers with more education typically earn significantly higher wages and are far more likely to be employed than workers who have no post-secondary education. For example, the latest figures from the Bureau of Labor Statistics show that workers with only a high school education are twice as likely to be unemployed as those with at least a bachelor’s degree. Among the employed, the median college educated worker earns 84 percent more than the median worker with only a high school education. Even those with just some college and no degree or an associate’s degree earn 16 percent more. College educated workers are also much more likely to be in the labor force.” [Brookings Edu] (emphasis added)

The correlation between education and employment thus secured, we can probably dismiss this complaint from the Conservatives as simply another layer of the anti-intellectualism all too common in that sector.

One thing that makes the Conservative arguments against increased funding for colleges and universities yet more incredible  is their interminable reference to “liberal elites;” note the Santorum jabs at President Obama for being a “snob” because he wants more young people to go to college, or charging that colleges are simply a form of “indoctrination.”

It appears that the one way to bring college tuition levels down, or at least to stabilize the situation, is to support increasing levels of state funding for both the research based and teaching oriented public institutions of higher education.   However, this advocacy will be faced by the forces of privatization (not an inconsequential element in Austerity Politics and Economics) and those who have found a way to increase their wealth through investments in SLABs (student loan asset based securities) – a topic for a post down the road.

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The Wells’ legacy and Pompous Post Racialism

Ida B Wells 2

Google is honoring Ida B. Wells-Barnett today for her journalism and activism on behalf of African Americans who were being lynched at alarming rates in this country.  She was born a slave in 1862 and lived until 1931.  How ironic that today we’re addressing issues involving the excessive use of force against African Americans by law enforcement authorities.

Among some white conservative elements there appears to be a protracted, if not profound, attempt to assert that there would be no racial problems eighty four years after Mrs. Wells-Barnett’s death if people would just stop talking about IT.  Witness Fox commentator Bill O’Reilly’s recent rant:

“O’Reilly ripped into liberals who he says are “demonizing” America by saying America is “a country dominated by white supremacy… to keep black Americans down.” And this goes “unchallenged by a cowardly media,” as he put it. He got really teed off as he insisted “there is no organized effort to harm black people by white people,” and then declared, “You want a war? You got a war! I’m not going to sit here any longer and take this garbage.” [Mdite]

The most obvious issue with O’Reilly’s rant is that racism doesn’t have to be organized to be pervasive.  The second problem is that we do have some demons which need to be faced down.

We do need to analyze and act upon information which persistently demonstrates that some police officers treat African Americans differently – out of fear? Out of biases? Out of lack of appropriate training?   One question that keeps rising out of the fog of information regarding the shooting of unarmed black suspects is “Did the officer perceive a greater threat because the suspect was African American?”  (Michael Brown) Or, “Did the officer lack sufficient self control to manage an arrest of an African American suspect?” (Walter Scott) Or to deal with a situation involving African Americans (McKinney, TX)?

Are African Americans treated differently, or abused, in police custody. Texas authorities have been called in to investigate the death of Sandra Bland, arrested in Waller County, who police reported had committed suicide in her jail cell. [ChicagoTrib] The family vociferously disputes this possibility.

Again, white supremacy needn’t be as blatant as that of the Council of Conservative Citizens, or the KKK, or any other associated hate group.  We can see it at work in the sentencing of black and white convicts, as described by a study conducted by researchers from Harvard, the University of Chicago, and Pennsylvania University:

“The researchers divided judges into categories based on level of race bias. To make these results concrete, they compare two examples. There are two identically situated defendants, who differ only by race – one black and one white. If they are sentenced by a judge who is among the least affected by racial bias (meaning in one of the best case scenarios), the black defendant is still 30% more likely to end up in prison. If they are sentenced by judge who is among the most affected by racial bias (one of the worst case scenarios), the black defendant is almost twice as likely to end up in prison.” [TP]

ALL other elements being equal, a black defendant is still 30% more likely to be sentenced to prison than a white defendant. Why?  If we take the discussion out of the realm of the institutional and into the general population we find that racism is far from a minor irritant under American skin.  Perhaps it would be instructive to take a closer look at the nature of white complaints.

One of the more illogical is the fallacious argument of “reverse racism,” which is used to cover a range of territory from opposition to affirmative action plans to the justification of person racial prejudice.  In definitional terms, the assertion fails to differentiate between racism (a social construct) and prejudice/bias (a personal trait.)  Additionally, it all too often relies on broad generalizations based on limited personal information or experience.  Contentions that entire population segments are “lazy,” or “criminal,” or otherwise socially unfit require the speaker to ignore all but that data which substantiates his position.  Yes, the unemployment rate for African Americans in this country is 9.5% [BLS]  However, that obviously means that 90.5% of working age African Americans are, in fact, working – hardly proving that they are “lazy” or disinclined to accept employment.

A variation on the “reverse racism” contention is the “they are taking our jobs” assertion.  This can be quickly, and relatively easily debunked:

“Although many are concerned that immigrants compete against Americans for jobs, the most recent economic evidence suggests that, on average, immigrant workers increase the opportunities and incomes of Americans.  Based on a survey of the academic literature, economists do not tend to find that immigrants cause any sizeable decrease in wages and employment of U.S.-born citizens (Card 2005), and instead may raise wages and lower prices in the aggregate (Ottaviano and Peri 2008; Ottaviano and Peri 2010; Cortes 2008).”  [Brookings]

So, if we do have legitimate questions regarding the interactions between members of minority communities and law enforcement institutions, and at least two of the most common racially based complaints are illogical or downright false, why the current interest in “Our Heritage?”  There’s nothing all that new about this, as Salon explained back in 2013:

“The white Southern narrative — at least in the dominant Southern conservative version — is one of defeat after defeat. First the attempt of white Southerners to create a new nation in which they can be the majority was defeated by the U.S. Army during the Civil War. Doomed to be a perpetual minority in a continental American nation-state, white Southerners managed for a century to create their own state-within-a-state, in which they could collectively lord it over the other major group in the region, African-Americans. But Southern apartheid was shattered by the second defeat, the Civil Rights revolution, which like the Civil War and Reconstruction was symbolized by the dispatching of federal troops to the South. The American patriotism of the white Southerner is therefore deeply problematic. Some opt for jingoistic hyper-Americanism (the lady protesteth too much, methinks) while a shrinking but significant minority prefer the Stars and Bars to the Stars and Stripes.”

It’s that shrinking minority which greeted our first African American President in Oklahoma and Tennessee.

csa flags obama trips

Complete with those Stars and Bars.  And in this instance we may be seeing another element in play.  There are those who cannot efficiently handle the difference between criticism and an attack.  No one is actually attacking American culture.  What is happening is that it is no longer socially acceptable to use the N-word, at least in public. It is no longer socially acceptable to slap Mary Jane on the fanny down at the garage.  It is no longer socially acceptable to call the Gonzales family the W-B term.  It’s true, Native American women take offense at the S-word.  Nor, is it socially acceptable to use the F-word as shorthand for members of the LGBT communities.  In short, it is no longer socially acceptable to view members of ethnic and gender minorities from the Olympian heights of assumed white supremacy.

Those people who are uncomfortable with this state of affairs may be longing to “take our country back.”  But, what do they mean by that statement? 

At one end of the spectrum there are the white nationalists, the fringe groups of the malcontents and the downright disturbed who cheered the actions of the Charleston Church shooter. It is harder to categorize the other delineations on that spectrum of opinion.  There are, of course, those who would happily pepper their conversation with the racial epithets which are no longer useful or appropriate, and who would gladly practice discrimination if it’s in their power to do so.  There are those who would like to use their unacceptable vocabulary (and related ideas) but don’t do so in public, and bristle at the thought they would personally be capable of bias or prejudice.  And there are the insensitive or ignorant who simply don’t know that some words and items are offensive and slip up in situations they later regret. (Example: Tom Petty’s apology for using the CSA battle flag on a 1985 album)

A person may well be suffering from “white supremacy” syndrome if he or she is aware that the CSA (KKK) battle flag is offensive, but waves it anyway because it is emblematic of their discomfort and their longing to return to a time when they weren’t aware the LGBT community existed (outside closets), when African Americans “knew their place,” when everyone spoke English (never since the expansion of the US after the Louisiana Purchase, and questionable before then), and when they could talk about tolerance without actually having to practice it.

So, the contention that we’re “post racial” is as inaccurate as it is pompous. It is little more than a thin layer of Kawamata silk which fails to even barely disguise the efforts to cling to their sense of self-worth on the equally fragile social ladder constructed of outmoded ideas, and outdated vocabulary.

Meanwhile, let’s join the celebration of Ida Baker Wells-Barnett and her legacy of journalism and civic activism.  No flags are required.

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The Forced Choice Fallacy: Employment and Education

NV Employment by Industry 2015 The Background: There are 1,418,000 Nevada residents in the state’s civilian labor force, and 7% of them are looking for work. The state has 1,254,300 individuals in the non-farm wage and salary category, up 3.4% since last year.  28.11% are employed in a single sector – Leisure and Hospitality. 5.41% are employed in construction related jobs.

Category  % of employment  change YOY
Leisure Hospitality 28.11% +5.1%
Trade, Trans, Utility 18.97% +3.8%
Prof Bus. Services 12.68% +2.8%
Government 12.13% 0%
Education/Health 9.68% +5.2%
Construction 5.41% +8%
Financial Activities 4.59% +0.7%
Manufacturing 3.33% +0.7%
Other Services 2.89% +3.7%
Information 1.12% -5.4%
Mining & Logging 1.08% -5.6%

(Source: Department of Labor, BLS)

The first table shows the situation at the present. Projections from NDETR estimate what employment will look like as of 2022.

Category Number of openings from Growth to 2022
Construction 24,580
Food Preparation/Service 23,100
Office & Admin Support 16,990
Transportation 12,640
Sales Related Occupations 12,120
Personal Care & Service 11,700
Management 8,660
Healthcare Practitioners  & Assts. 7,780 (+3,680 Support positions)
Business Financial Occupations 6,850
Production Occupations 6,530

*There are projected to be another 6,500 jobs in the Installation, Maintenance, and Repair occupations category; and, about 4,840 jobs related to Education, Training, and Library personnel positions. Of the 24,580 jobs in “Construction and Extraction” only 80 openings are projected to be in the “extraction” category related to “growth.”  In short, the Nevada economy of 2022 is projected to be much like the Nevada economy of 2015.

False and Forced Choices

Now that we have some hard data, and some rationally projected data about employment opportunities in Nevada extending to 2022, it’s time to take a gander at some of the policy decisions which need to be made about how to create expansion in the economy.

Here’s a classic example of how NOT to approach the issue:

“The left claims they’re for American workers, and they’ve got lame ideas, things like minimum wage. We need to talk about how we get people skills and qualifications they need to get jobs that go beyond minimum wage.”

Scott Walker, yesterday  [h/t Angry Bear]

First, the most recent entry into the GOP Candidate Bus separates “skills and qualifications” from issues about raising the minimum wage.  This seems to be an artificial forced choice – either one supports the minimum wage increases or one supports more education and training to become qualified for better paying jobs.  (Not that Governor Walker’s slashing of the higher  education budget makes his position comprehensible?)   It is humanly possible to support both increasing the minimum wage AND support additional resources for our post secondary educational institutions.  And, there are some practical reasons this would make sense for Nevada.

Secondly, let’s look at the minimum wage issue as a practical matter in Nevada.   Retail sales worker positions account for 7,450 of the 12,120 projected job openings due to growth in the NDETR estimations for 2022. Food and beverage service positions account for 13,260 of the total 23,100 food preparation and serving jobs estimated to be available by 2022.  What would punch up the economy of Nevada faster? Leaving the minimum wage at current levels for the expected positions in retail and hospitality sectors of the Nevada economy? Or, increasing the minimum wage for those 20,710 jobs?

A person earning $7.25 per hour working 40 hours per week for 50 weeks per year would earn $14,500.  A person earning $10.00 per hour working a 40 hour work week for 50 weeks would earn $20,000 annually.  If you are keeping score with your calculator – that’s a difference of some $113,905,000 available to be pumped into the local economy from those 20,710 jobs.  Since we know from the research that lower income workers spend more on basic household expenses, that’s an additional $114 million for groceries and supermarkets, clothing stores, housing and furnishings, and for transportation.  One more time – The GDP formula:

Gross Domestic Product Formula Remember, that “C” in the formula is Consumer Spending.  And, I can keep hauling out this graphic until it hits home that increasing consumer spending is an essential feature of what drives growth.

Now, about those “qualifications and skills..”

Where does one get additional training for higher paying jobs?  If a person did not intend to stay in a minimally paying food service job, or a low paying construction job, or a low pay office job, then where are the training programs for advancement?

Let’s assume for the first argument that an individual wants to advance in the same field as his or her entry level position.  Nevada has both public and proprietary post secondary educational programs available. [NVps pdf] On the public side, a person wanting to move up in the office might want to consider an associate’s degree in bookkeeping? Management?  The community colleges offer these programs throughout the state.  And, yes, a person earning more than a minimum wage might be better able to take advantage of the post secondary training available from the Nevada system.

How about a move from one occupation category to another?  What if our hypothetical prospective employee wants to move from a retail job into the field of medical or health information technology? There’s a program for that at Southern Nevada College.

In short, the most efficient and cost effective way to provide career pathways for economic improvement is to invest in our community colleges and technical education institutions.  These are also the best ways to assist older workers who are moving from declining fields to those in which some growth is expected.

What did the President have to say about community colleges?

“As the largest part of the nation’s higher education system, community colleges enroll more than 6 million students and are growing rapidly. They feature affordable tuition, open admission policies, flexible course schedules, and convenient locations. Community Colleges are particularly important for students who are older, working, or need remedial classes. Community colleges work with businesses, industry and government to create tailored training programs to meet economic needs like nursing, health information technology, advanced manufacturing, and green jobs.”

So, yes, it makes sense to provide support for post secondary education in Nevada.  Those “qualifications and skills” have to come from somewhere, and what better way than to expand the capacity of our post secondary programs to enroll and instruct those who want to advance in a chosen field or become qualified for employment in a new one.

Meanwhile, we have to acknowledge that a preponderance of the growth in this state is still in occupational categories such as retail sales and food service which are relatively low paying jobs, and from which we could expect much more robust economic growth by requiring if not a living wage of $15.00 per hour then at least an increase to $10.00.

No forced or artificial false choices are required: We really can do two things at once.

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Our Thirty Five Years of Mythological Economics

trickle down economics

The only problem with this cartoon version of  Trickle Down economics is that the bird at the top should be getting larger as the years extend.  Likewise, the birds in the middle range should be getting more stressed as they attempt to stay on their middle income perches.  It’s a nice touch that the background is in blue, suggesting we’re about to be washed up in a tide which only serves those who are perched high enough to avoid drowning.

Meanwhile, the  best response to the sentence “A rising tide lifts all boats,” is “Where Are The Customers’ Yachts?”  For those who have not yet read this 75 year old classic – it’s still available, and still germane to American economics.  It was true then, and true now.  The problem is that the financial sector has hijacked significant portions of our economic thinking, in ways that have left us prone to being bedazzled by BS.   Thus, we’d prefer to rail against the Wall Street Casino rather than believe we’ve been following some very foolish advice offered, in turn, by some very foolish, and very self serving,  people. And, there are people challenging the BS rendition of American capitalism.

Those who missed Mrs. Clinton’s speech at the New School (NYC) on our economic challenges can view the C-SPAN broadcast here. (55 minutes)

The initial response from journalists was “Hillary’s bashing Wall Street.” [Reuters] This makes for a convenient headline – Beltway Shorthand for her support for regulation of Wall Street investment bankers’ transactions – however, it doesn’t come close to adequately summarizing what both candidates Clinton and Sanders have been saying about financialism in American economics. The Beltway Media is missing the point, perhaps because it doesn’t fit neatly into a template predetermined by editorial policy, or a simplistic code for easy lead paragraphs.

The point is that we have had 35 years of what President George H.W. Bush called Voodoo Economics (although bless his heart he promoted it like any good Republican), and it doesn’t work in the real world. Why? Because the mythology violates the simple principles of American capitalism:

”So here’s an idea worth spreading. In a capitalist economy, the true job creators are consumers, the middle class. And taxing the rich to make investments that grow the middle class is the single smartest thing we can do for the middle class, the poor and the rich.” [LAT]

With this basis in mind, let’s tackle some of the mythology and deal with a bit more economic reality.  We might as well start with the “job creators” sound bite.

#Job transference is not necessarily job creation.  Yes, Home Depot has about 340,000 employees. [USAT]  However, in order to achieve those numbers, how many local hardware stores went out of business, or had to shave employment numbers, because they were hard pressed to compete with the Big Box Stores?  Of the 340,000 Home Depot employees only 21,000 were salaried, the rest were working on a temporary basis or for hourly wages.  The average hourly wages for employees in the retail sector are $14.36 per hour. [Monster] Further, we know that about 1/3rd of all retail sector employees are working part time. If we take a closer look we find that the median wages for retail employees (full time) in building materials and garden equipment were about $12.21 per hour. [BLS]

So, we have to ask ourselves, if a Big Box Store moves in an puts a local supermarket or hardware store out of business, does that translate into “job creation” or simply the transference of personnel from one job into another – possibly lower paying – job?

#Low wages make stocks attractive and the overall economy weaker.    The largest fast food chain in the U.S. has approximately 440,000 employees. [USAT]  And, what do food service preparation employees earn?  About $19,300 per year, or approximately $9.28 per hour. [BLS]  The average weekly hours for all employees are currently estimated as 25.8 per week, and for nonsupervisory employees at about 24.6 hours per week. [BLS] Significantly, before we fall into the hype-vat argument about the “kid’s first job,” only about 30% of fast food workers are teenagers, another 30% are between the ages of 20 and 24, and the remaining 40% are 25 years of age and older. [CEPR]

From the shareholder perspective it makes perfect sense to keep wages low, employee turnover high, and continue to appeal to those who have a “quarterly value” vision of America.   From the perspective of other business owners in the area, those low wages translate to minimal disposable income, which means fewer customers for their products and services.  In short, the yacht at the top is sailing along while the little boats bounce around the rocks.

#Wealth created from indebtedness doesn’t trickle anywhere.  Median household earnings are slowly, very slowly, emerging from the last Recession.

real median household income If we find more jobs transferred from, say, smaller local firms to larger national ones, or more jobs are being created in sectors like food and beverage service with notoriously low wages, then we might expect to find household incurring debts to maintain a middle income life style.

Consumer indebtedness, which was down to 4.88% of disposable income in the fourth quarter of 2012, is now back up to 5.30%. [Fed]  There are a couple of ways to see this, first as an indication that people are feeling better about assuming credit card or personal debt because their incomes are more stable, or secondly that while they’re feeling a bit better, the credit card has become a way to keep afloat.  However, those debts are the basis for altogether too much of what constitutes Wall Street wealth accumulation.

Household debt Whatever amounts of these debts are securitized means that they’ve gone into the Wall Street Casino to be used as the basis for hybrid financial products.  So, what’s been happening to the securitization of auto loans?  It’s “coming back strong” but not at “pre-crisis levels.” Translation: It’s not a bubble. [FRB ATL]  It’s lovely to know the Federal Reserve doesn’t consider the securitization of auto loans at the Bubble Level, but it’s also a bit worrisome to note that what is gained from that securitization isn’t trickling down anywhere near the automobile product consumer.

Nor is there much happy news about securitization and the student loan business.  ZeroHedge offers this gloomy prospect:

“So just as we have been warning about for sometime now: an underestimation of the impact of deferral and forbearance and weakness in the job market is likely to trigger defaults on billions in student loans and because these loans comprise the collateral pool backing ABS sold to investors, the ripple effect is magnified and we wonder if the July 2007 moment for the student loan-backed ABS market may come sooner rather than later.”

The ‘wealth’ produced on Wall Street is based on the loan the students took out to pay for educational expenses, securitized, tranched, sliced, diced, and repackaged for the ‘benefit’ of the investors – those who may very well get burned in this round of Securitization Bingo.

Evidently lost on the Sultans of Securitization is the simple fact that an asset based security requires someone to be able to afford the purchase of educational services or automobiles, or the other stuff on the credit card – the original assets.

It’s one thing to announce that “middle class incomes” are back where they were in 1995 – and another thing entirely to notice that the costs of college tuition are up 61% since ‘95; that home prices are up 13%; that the price of gasoline is up 94%; and that Big Mac is up 28%. [moneyCNN] These numbers aren’t the sort to make anyone comfortable who’s taking out the student loan or buying the house. Eventually, even Wall Street may have to take notice of the fact that no matter how much revenue it can generate in terms of ABS and the hybrids related thereto, if American consumers can’t generate sales – and jobs – then investors are caught trying to ride the bubbles.  Bubbles always pop, that’s why they’re bubbles.

The ‘wealth’ from the sales, and hedges, and bets, on asset based securities, again, trickles down nowhere near the average home owner or car buyer.  However, no one is arguing that ABSs don’t have value.  They are a way to spread the risk around, and that’s positive.  They are negative when we see them mask intrinsic cracks in American capitalism, and negative when we see that the revenue generated never quite manages to trickle back down to the local economies perhaps in the form  of better roads, better schools, better parks, better libraries, and better public services like broadband.

Candidates Clinton and Sanders aren’t “bashing Wall Street,” they are simply trying to point out that the lurch from one bubble to the next isn’t a productive way to run an economy, and lunging from one volatile market to the next isn’t the way to insure that the capacity of the average consumer to purchase the assets on which the securities are based remains steady and profitable for everyone.  If Wall Street can’t divest itself of its 35 Year Investment in imaginary economics, and can’t restrain itself from short term financialist thinking, then someone has to be the adult in the room.  The adult is called reasonable regulation, and that’s all they are asking.

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Filed under Economy, financial regulation

Venus Rising?

girls soccer One of the ESPN documentaries which deserves another look now is “Venus Vs,” the 2013 film narrating how Venus Williams took on the titans of tennis – the financial titans – and won.  It took until 2007 for women to receive the same prize money at Wimbledon as men, and it required Venus Williams to draw the line at what was acceptable in her Times op-ed.  Now, the parade for the US Women’s National Team is over, and presumably the cake’s been eaten and the ceremonial key to the city handed over. However, when the debris from the parade is cleared the economic prospects for women will be essentially the same as they were before the ride through Manhattan began.  Nor are we close to training and coaching the young people we need to develop the talent required to maintain our rankings.  We could use another Venus rising.

We’re Number One!

The disparity in men’s and women’s financial support in athletic endeavors is in too many ways illustrative of our perspective on sports in general: We expect to win, but we really aren’t all that excited about financially supporting youth development programs.  The parsimonious way in which we support after-school activities in general (for both boys and girls, academic and athletic) contrasts sharply with our expectations of the national teams which later represent us.  Since we’re speaking of soccer, let’s look at those statistics.

In 1974 there were 103,432 youngsters enrolled in youth soccer programs, and as of 1995 there were 2,388,719.  55% of that number were boys, 45% were girls. [usyo]  Somewhere in that 2209% increase in participation were members of the 1999 World Cup winning women’s national soccer team.  Further, if we drill down we find the members of that trailblazing crew came from collegiate programs – including Portland, UMass, Cal, Notre Dame, Central Florida, Stanford, and of course UNC.  Title IX worked.

As of 2014 there were 3,055,148 youngsters participating in youth league soccer, and we’d have to guess the breakdown was close to the 2008 reporting – 52% boys, and 48% girls.  Again, from this group came the ladies who enjoyed the parade in NYC.  School programs, youth/community programs, and collegiate programs contributed to the talent pool from which this team was drawn.

TV commentary made much of the “16 year drought” since the ‘99 World Cup match in women’s soccer, and when the US men’s basketball team placed 3rd in the Seoul Olympics (1988) one might have expected the sky to shatter at any moment – a problem corrected by sending the Dream Team to Barcelona the next round.  When the 3rd place finish repeated in Athens (2004) the response was to send in the Big Guns again in 2008.  We expect the national men’s team to excel, to win, – to crush opponents. We expect the women’s soccer teams to rank in the top five – and we expect to win.

However, we don’t necessarily DO what it takes to expand the talent pool from which we derive these teams.

Penny Wise Pound Foolish

We’ve left some after school programs in general languishing on the vine, both for academic and athletic interests:

“In the Afterschool Alliance’s 2012 survey, although a majority of afterschool program providers revealed that their program’s budget is inadequate to meet the needs of the students and families in their community, this number is even higher among Latino majority programs and African-American majority programs.  Additionally, African-American majority programs and Latino majority programs were more likely to report that their funding is down from three years ago.” [asall]

Not only is funding strained for after school programs but we’re not addressing a crucial factor for African American and Latino youngsters, safe transportation to and from program venues.

“Transportation, safe transport in particular, is a significant hurdle to enrollment in afterschool programs in African-American and Latino communities.  African-American parents and Latino parents were both much more likely to cite that their children did not have a safe way to get to and from afterschool programs as a barrier to enrollment than parents overall.  Additionally, approximately half of African-American and Latino parents of kids not enrolled in an afterschool program indicated that transportation to and from afterschool programs factored into their decision not to enroll their child, compared to less than two-fifths of parents overall.” [asall]

All too often we’re pleased to lecture parents on how their children need more exercise, more academic assistance, more Story Hour, more Anything After School – but we’re obviously not willing to invest in the transportation which would enhance those enrollment figures.   If we drill down to athletic activities, the money issues become ever more evident.  Consider the implications of the following ESPN graphic:

Age entry sports graph The single largest factor in establishing when children start participating in youth activities is whether or not the parents are earning over $100,000 per year.

Here’s another ESPN graphic which sheds a bit more light on the subject.  Whose children are more likely to participate in a variety of after school exercise/athletic activities?

most likely playing on teamsIf you noticed “Suburban/Affluent” across the “most likely groups” and urban/low income across the graphic for “least likely groups,” you’ve gotten the point.

Should we continue to constrict the talent pool to suburban/affluent families, to those families which can afford transportation, to those families which can come up with the cash for equipment and other necessities, then we’ve artificially constrained our own cohort of prospective talent – and yet we still demand that the outcome in world competition be the same – we crush opponents in soccer and basketball.

Was Title IX supposed to fix all this, especially in women’s sports?  The law itself can’t fix the disparity in resources illustrated above.

“Most importantly, Title IX hasn’t managed to extend the enormous social and health benefits of sports to all girls equally. In 2008, a national survey of third- through 12th-graders by the Women’s Sports Foundation found that 75 percent of white girls play sports, compared to less than two-thirds of African-American and Hispanic girls, and about half of Asian girls. And while boys from immigrant families are well-represented in youth sports, less than half of girls from those families are playing.*The gender gap is also worse in urban schools and among kids from low-income families.

These disparities in youth sports persist at the collegiate level. African-American women are underrepresented in all sports except Division I basketball and track and field, and Latinas make up just 4 percent of female athletes in the NCAA. As Benita Fitzgerald Mosley, an Olympic gold medalist in track and field, recently explained to the New York Times, “[I]n the grand scheme of things, Caucasian girls have benefited disproportionately well, especially suburban girls and wealthy Caucasian girls.” [MJ]

The disparities we find in programs for very young children continue through collegiate competition.  And, here we go again – the gap is wider between the affluent suburbs and the urban, less affluent communities of color.

Thank you from a grateful nation….

And here we return to the money question.  If we can expand the talent pools for our national teams, and if we can get more youngsters involved in healthy activities at earlier ages, and if we can get more young girls involved, and if we can get more young girls from less affluent neighborhoods – what happens?

“This year’s (World Cup) tournament featured a generation of American women who have not lived in a world without Title IX and did their jobs elegantly and professionally: They won the game, defeating a longtime rival in Japan; and as they did during the 2012 London Olympics, they won with high-caliber athleticism, class and sports-womanship along the way.

Yet the total payout for the Women’s World Cup this year will be $15 million, compared with the total for the men’s World Cup last year of $576 million, nearly 40 times as much. That also means that the Women’s World Cup payout is less than the reported $24 million to $35 million FIFA spent on its self-aggrandizing fiction film, United Passions.” [Politico]

Yes, and two members of the USWNT were living with Jeff Van Gundy and his family because the salaries paid in the professional leagues make finding accommodations a real problem. [USAT]  The salaries in the US for women players range from a measly $6,000 to $30,000. [STFAnother graph may tell part of the tale:

Air timeAt this juncture we have a Chicken and Egg argument of sorts – do we have to have air time before people get engaged sufficiently to attract more corporate and advertising sponsorship? Or, if we have more corporate and advertising sponsors will the women’s side of the ledger get more public interest? What will crack the egg or chase down the chicken?

“Most of us have been socialized to accept men’s sports as dominant, and somehow automatically more interesting. The problem is that once society has internalized this falsehood — and let’s face it, it’s a falsehood that’s millennia in the making — it’s not so easy to correct it. Women have been fighting for decades, centuries, to be seen as equals to men both on the playing field and off of it.” [BusInsider]

There are some glimmers of hope on the horizon.  EA Sports will include women’s soccer in its products, Fox Sports did a good job of broadcasting this latest World Cup tournament and was rewarded with high ratings for the final game, and advertisers dipped their toes in the water – even Clorox got into the act. Nike sold jerseys, and no doubt other firms will find ways to capitalize on the market.  However, it may not be all sexism and short attention span theater issues, there’s also the problem of longevity.

As long as investors in women’s sports leagues continue to demand immediate returns there will be problems – just as there are with short-termism in other markets such as our financial ones.  Even a league as formidable as the NBA has had its problems – remember the original Denver Nuggets? Few do. Or, the end of the ABA in 1976? Or, the much traveled Hawks from Moline, to Milwaukee, to St. Louis to Atlanta?  Or, the struggles and travels of the Philadelphia Warriors and the Syracuse Nationals?  Obviously,  some patience is required.

Now What?

While it would be nice to have some powerful voice like that of Venus Williams championing more compensation for female athletes, we probably can’t afford to wait for that day.  Instead, if we truly want to see continued top level, world class, performances by our players and teams we need to:

  • Invest in after school activities for young people, and not just those in the affluent suburbs, with attention to such quotidian problems as transportation for the children so they can participate safely.
  • Encourage the development of youth programs, both academic and athletic for urban and rural youngsters, and be willing to staff and maintain these efforts.
  • Encourage and invest in programs for youngsters from ethnic minority groups – leave No Child’s Behind Left on the Couch.  To accomplish this we’ll need to invest in creating safe public spaces for kids to play on safe grounds with adequate and up to date equipment.
  • Get over the idea that a game between East Deer Breath State’s men’s team and the Wolverines of Western Boonie U. will automatically be more interesting than a match between the University of Connecticut and the University of Notre Dame’s women’s basketball teams.  Or, South Carolina? Or, Tennessee? Or, Stanford? Or, UCLA? Or LSU?
  • See some heavy-duty marketing campaigns establishing a positive brand for women’s teams in local and regional areas.
  • Develop some patience – no league (or any other enterprise) will yield immediate returns.

Finally, it will be a fine day when we stop perceiving children as an “expense,” and start visualizing them as “investments.” Every after school activity, every sports team, every youth league, every school extracurricular activity, every neighborhood playground, every city park, every local library is an investment in healthier more productive future citizens.  Yes, kids are expensive – but they’re well worth it.  We have proof of that in the eloquent words of one Venus Williams on June 26, 2006:

“I believe that athletes — especially female athletes in the world’s leading sport for women — should serve as role models. The message I like to convey to women and girls across the globe is that there is no glass ceiling. My fear is that Wimbledon is loudly and clearly sending the opposite message: 128 men and 128 women compete in the singles main draw at Wimbledon; the All England Club is saying that the accomplishments of the 128 women are worth less than those of the 128 men. It diminishes the stature and credibility of such a great event in the eyes of all women.” [Williams]

We can add some stature and credibility to our interest in athletics by adding a few more blows to that glass ceiling, and allowing more youngsters to dream of playing at Wimbledon, at Maples Pavilion, at BC Place, or Madison Square Garden….

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Filed under basketball, football, media, sexism, Title IX, Women's Issues, youth

Department of No Surprises: From Charleston to Murrieta to Washington, D.C.

 

Murrieta protest 2

In July, 2014 protesters gathered to block DHS busses carrying Central American women and children in Murrieta, CA.  It was ugly, and unnecessary, and gave the town a dismal national reputation. [HuffPo]  Murrieta is in the 42nd Congressional District, with a 46.6% white population, 36.2% Hispanic,  5.1% African American, and 8.8% Asian American. The district has been consistently Republican since 2003.  So, why review this information today?  Because the Representative from this California district, Ken Calvert, has raised the bloody flag in the halls of Congress.

“The amendment to the House’s Interior and Environment spending bill would allow for the display of Confederate flags at national cemeteries managed by the National Park Service (NPS) even though members voted to ban the practice earlier this week. It would counteract another amendment to the same bill blocking the service from selling Confederate flag memorabilia in gift shops in the future. 

Rep. Ken Calvert (R-Calif.) offered the amendment in the closing minutes of floor debate on the spending bill Wednesday night. He made only a token statement in support of the amendment before setting up a roll call vote on it for Thursday.” [The Hill

Even though Representative Calvert’s amendment hit the floor during the waning hours of the Congressional day, it drew fire overnight when House Minority Whip Steny Hoyer (D-MD) commented:

Hoyer called the amendment, introduced by Rep. Ken Calvert (R-Calif.) Wednesday night on a spending bill, “appalling.” He challenged House Republicans to vote against it and preserve amendments banning Confederate flag sales at national parks and displays at national cemeteries.

“That racist, divisive flag of slavery, segregation, and secession is not an appropriate symbol to sell or fly in our national parks and cemeteries run by the National Park Service,” Hoyer said in a statement early Thursday. [The Hill]

Representative Hoyer wasn’t the only member of Congress appalled by the  Calvert amendment.  Minnesota Rep. Betty McCollum retorted: “After the murder of nine black parishioners, I never thought that the U.S. House of Representatives would join those who would want to see this flag flown by passing an amendment to ensure” the continued flying of the Confederate flag, McCollum said.” [Roll Call]

Thus evaporated any remaining Democratic support for an otherwise unlikeable Department of Interior appropriations bill.  Representative McCollum wasn’t alone; several other Democratic party Representatives took to the floor to lambaste the idea of voting on the Calvert amendment today, July 9, 2015. [The Hill]

Representative Calvert offered an explanation for his amendment, saying he had been asked by Representatives from southern states to introduce it, and there were Republican members of the House who would not support the Interior Department’s appropriation bill be cause of earlier language banning the CSA battle flag in grounds under DoI administration. [The Hill]

And now we come to the totally predictable part of the story – encapsulated by the remarks of Speaker John Boehner (R-OH):

Speaker John Boehner (R-Ohio) told reporters the spending bill had been pulled to avoid the issue from becoming a “political football.” “That bill is going to sit in abeyance until we come to some resolution,” he said.” [The Hill]

This, from the Speaker who said only days ago in the immediate aftermath of the Charleston Church massacre, that Congress would be “the adults in the room.”

So, we have yet another major piece of legislation sitting “in abeyance” while the House Republicans engage in their internecine battles over whether or not to allow the pennon of slavery, Jim Crow, segregation, and racism to flap on federal grounds.  Additionally, it truly is remarkable that yet again House Republicans have slipped their own poison pill into what was one of their own bills.

This seems less like gridlock between two adversarial parties, and more like what happens when a single party with a majority in Congress cannot control its own caucus.  The Democrats should be perfectly pleased that an appropriations bill which stripped the EPA of essential authority to regulate clean air and clean water is “in abeyance.”  Republicans who wanted to dismantle the EPA’s authority to control pollution may be wondering how and why a California Representative could so easily thwart their plans with a truly insensitive and racially charged amendment on behalf of his southern brethren.

We may have to look no further than the angry faces of the anti-immigrant protesters in his district – Welcome Back to Murrieta?

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Filed under anti-immigration, Appropriations, conservatism, ecology, House of Representatives, Immigration, Interior Department, pollution, racism, Republicans