(Credit: Nashville Public Radio)

Fincher invoked the Bible in his defense of the devastating cuts, quoting, “The one who is unwilling to work shall not eat.”

At a Holiday Inn in Memphis over the weekend, Fincher expanded on his version of the Christian social gospel: “The role of citizens, of Christians, of humanity is to take care of each other, but not for Washington to steal from those in the country and give to others in the country.”

While Fincher interprets food assistance for the needy as “stealing,” he has not similarly condemned the Farm Bill’s massive agricultural subsidies. In fact, he supported a proposal to expand crop insurance by $9 billion over the next 10 years. Fincher has a great personal stake in maintaining these particular government handouts, as the second most heavily subsidized farmer in Congress and one of the largest subsidy recipients in Tennessee history:

USDA data collected in EWG’s 2013 farm subsidy database update — going live tomorrow –shows that Fincher collected a staggering $3.48 million in “our” money from 1999 to 2012. In 2012 alone, the congressman was cut a government check for a $70,000 direct payment. Direct payments are issued automatically, regardless of need, and go predominantly to the largest, most profitable farm operations in the country.

Fincher’s $70,000 farm subsidy haul in 2012 dwarfs the average 2012 SNAP benefit in Tennessee of $1,586.40, and it is nearly double of Tennessee’s median household income. After voting to cut SNAP by more than $20 billion, Fincher joined his colleagues to support a proposal to expand crop insurance subsidies by $9 billion over the next 10 years.

As the Environmental Working Group notes, crop insurance subsidies have no limits on their recipients’ income levels. Therefore, the bulk of the crop insurance is paid out in million-dollar installments to a small group of large farm businesses, while the bottom 80 percent of farmers receive roughly $5,000 a year. SNAP, on the other hand, limits aid to income below 130 percent of the federal poverty line, or $30,000 per year for a family of four.

That’s bad news for the middle class. In a new video series, the Center for American Progress showcases three stories that demonstrate the important role union membership plays for working families struggling to get by.

La Tonya Johnson was a unionized child care worker in Milwaukee until Wisconsin Gov. Scott Walker (R) cracked down on collective bargaining rights in the state:

With the help of a union, La Tonya says she was “able to afford to pay my mortgage, I wasn’t facing foreclosure, and life was relatively comfortable,” thanks to a guaranteed weekly wage regardless of which children actually showed up to her daycare center each day. After her ability to join a union was repealed, she lost that guarantee, and she descended into poverty. “It feels like I’ve hit rock bottom over night,” she says. “For people who think that having a union or being organized doesn’t have a bottom line effect, I’m here to tell you that it does.”

Susan Kim and Jeremy Pikser, writers in New York, explain that a union has helped them to pursue their passions while maintaining a decent quality of life:

While Susan had misgivings at first, she quickly learned the benefits of joining a union. “It made really clear sense to me when I started seeing more money, when I started qualifying for health insurance… Suddenly I had a pension plan which I’d never had before.” The effects were even starker for Jeremy. He was diagnosed with throat cancer in 2008 and had to undergo an expensive course of treatment, “which would have beyond bankrupted me” without quality health insurance negotiated by the Writers Guild, he says. “It probably did save my life because I probably wouldn’t have been able to get the level of care that I got.”

Beresford Simmons has been driving a New York City taxi for more than 45 years and is a member of the non-traditional union the Taxi Workers Alliance:

The union has seen recent success, winning a 17 percent fare hike and health care coverage. That’s meant a lot to Beresford and his wife. “With unionization from the Taxi Workers Alliance, we could afford to put a roof over our head,” he says. He says he’s a part of the union because “I just don’t want to see the next generation of cab drivers go through the same thing that I’ve been through.”

State policies play a big role in helping families to achieve this sense of economic security. Yet a new scorecard from Wider Opportunities for Women (WOW) has found that most states don’t have a comprehensive policy regime. While some stand out in a few areas, no state has fully addressed all of the needs of working families.

Looking at 85 different policies, including the minimum wage, Earned Income Tax Credit (EITC), family and sick leave, public education spending, savings and retirement support, and support for child care, health care, and housing, the scorecard granted each state a grade on “their potential to improve the economic security of workers, families, and retirees.” No state in the country received an A or B grade – the highest, for Washington, was a B-. Most states received grades between a C+ and a C-, while four got the lowest, a D+. An overview of how each state fared can be found in this map:

The states that fared best are those that have strong policies on the minimum wage and EITC. Many states also improved their grades thanks to policies that promote savings and eliminate asset eligibility tests for social programs. Yet most fared poorly on family leave, paid sick days, flexible work arrangements, and unemployment insurance. Many still rely on the low federal floor set in these areas.

While some states may counter that their budgets are constrained, making it difficult to implement more robust policies, WOW’s report found that the grades were “not strongly related to a state’s median income, budget size or fiscal health.” Therefore, it found, “these factors do not define a state’s ability to improve its residents’ security.”

Many states have been pulling back on these investments, cutting spending on things like public education, child care, and higher ed, often in lieu of raising taxes. This report may provide evidence that there is room to improve policies to support working families.

The strike follows similar actions by private-sector workers in other major cities. Fast food and retail workers in New York City, St. Louis, Milwaukee, Detroit, and Chicago have walked off the job in recent weeks to demand wage hikes. Like those workers, the men and women striking in the capital Tuesday are struggling to tread water economically, even while working full-time. The difference for these most recent participants in the spreading service worker action is that they are paid, indirectly, by the federal government.

As the policy think tank Demos reported in early May, federal dollars are connected to more low-wage jobs than Walmart and McDonalds combined:

We find that nearly two million private sector employees working on behalf of America earn wages too low to support a family, making $12 or less per hour. […]

These workers represent a large spectrum of occupations, from workers sewing military uniforms to hospital aides funded by Medicare, security guards with contracts to protect public buildings, and food cart vendors at the National Zoo.

President Obama has proposed hiking the federal minimum hourly wage to $9, from its current $7.25 level. While opponents point to gradual increases from 2008-2010 as sufficient, the reality is the minimum wage still has less buying power than it did in the 1970s.

This public policy failure is also a major component of the gender wage gap that persists today. Working Americans in six major cities are now organizing to combat Congress’ failure to ensure that service work is livable.

Credit: Greg Basta

Frustration with the failed execution of various weakly-constructed legal settlements stemming from widespread foreclosure fraud bubbled over today into a protest at Justice Department headquarters that culminated in homeowners being arrested.

Using tactics and rhetoric familiar from 2011’s Occupy Wall Street demonstration, a group of activists and foreclosed homeowners marched on the Justice building in downtown Washington, D.C. According to tweets and photographs from activists on the scene, protesters moved past a police barricade and attempted to establish a sit-in, at which point police began arresting homeowners and activists.

Why the renewed fervor? Despite agreeing to various settlements since 2008 requiring a total of $5.7 billion in payments to homeowners, “banks have paid less than half” that amount to date, according to the Washington Post:

Critics point to the 2011 agreement the Office of the Comptroller of the Currency (OCC) and the Fed struck with more than a dozen mortgage servicers as a prime example of the dysfunction. […]

After 12 months, no homeowners had received a dime. But the eight consultants managing the process on behalf of the banks were paid nearly $2 billion. […]

Problems are also emerging in the largest mortgage settlement — a $25 billion deal between state and federal authorities and five banks accused of using forged paperwork to quickly foreclose on struggling homeowners.

The banks agreed to pay $1.5 billion directly to borrowers. No checks have been sent, though the first are likely to go out later this month.

While banks have been slow to fulfill the meager direct payments provisions of the settlements, they’ve spent much more heavily to get properties empty and ready for resale.

These settlements are very small in relation to the problem they’re meant to ameliorate and the allegations they’re meant to justly resolve. Even if the banks had complied with alacrity, the $5.7 billion total direct payments to homeowners tallied by the Post pales in comparison to the total harm caused by “robo-signing” and other forms of mortgage origination and foreclosure fraud.

New York Attorney General Eric Schneiderman, a primary negotiator of the 2012 settlement, has announced he will sue Wells Fargo and Bank of America for failure to comply with the terms of that $25 billion package. But just $1.5 billion of that settlement was ever intended to come as direct compensation to “robo-signing” victims and other wrongfully foreclosed homeowners.

The total value of underwater mortgages in the market when that settlement was finalized – three years after the financial crisis – was estimated at $700 billion. The 2012 settlement was divisive at the time, with critics arguing it was insufficient and designed in such a way that banks could abuse its terms. Subsequent settlements have been similarly afflicted and ineffective.

That means Murphy will be eating on a few dollars per day, as his colleagues debate a measure that would cut $4 billion from the SNAP budget over the next decade. Murphy is using the $3 per day allowance FRAC and allies recommended in 2007 guidelines for lawmakers interested in the challenge, although government data shows the program averaged about $4.40/day nationwide in fiscal year 2012.

But if anything, the SNAP Challenge understates the hardships actual SNAP recipients face, both today and in the near future.

Those Americans must make it a full month on SNAP, and statistics show that about 80 percent of a given recipient’s monthly allotment gets spent in the first two weeks of the month:

Additionally, there is already a major cut scheduled for fall of 2013:

It’s harder to quantify another facet of life on SNAP that Murphy’s attempt to raise awareness of the program won’t require him to face: social stigma. The senator won’t have to worry about a cashier loudly asking him to run his Electronic Benefits Transfer card again while other customers wait behind him. He probably won’t experience the judgment of peers described here by Tiffani Stacy of Columbus, TX.

Murphy’s experience of life on SNAP, however muted, ought to help draw attention to the program’s inability to absorb the further cuts Congress has proposed.

Sequestration will reduce the $1.2 billion these schools normally receive by more than $60 million. According to analysis by the Center for American Progress, there are nearly 150 schools in the country relying on more than $1 million in aid. Some could see cuts in the millions of dollars.

The National Association of Federally Impacted Schools, which works closely with these communities, is conducting a survey of school districts grappling with this reduction in funding. While the full results won’t be ready for another month, the preliminary report, shared with ThinkProgress, shows that many are already facing drastic choices. One school warned that “we may have to close schools” and another cautioned that “closure is always a possibility.” Six of the nine schools it talked to will have to consider closing schools if sequestration continues past next year.

• The Window Rock Unified School District in Arizona gets just under 60 percent of its funding from federal aid. This year it eliminated about 65 staff positions through attrition and cut down its buildings from seven to four. If sequestration continues, it will have to close schools, many of which are in areas of high unemployment and poverty.
• The Harlem Elementary School District didn’t rehire for some positions and asked 100 employees to cut $100 from their operational budgets to deal with a 47 percent cut to the budget this year. It also canceled Kindergarten for a day, but one five-year-old still came to school because he was hungry and needed his state-subsidized breakfast. Next year it will have to dip into reserves or hold fundraisers. After that it will have to cut staff, go over the state class size limit, and look at closing schools.
• Heart Butte in Montana, which gets over half of its funding from the federal government, cuts have forced the district to hold off on all repairs this school year. That means that there are leaks, no hot water, roofs that need patching, buses in neglect, and a playground that doesn’t comply with regulations. The school needs to install new doors and safety gates, but that is also on hold. If things don’t improve it may have to lay off teachers.
• The Hays/Lodge Pole school district in Montana, which is losing more than half of its budget, is unable to fill a counseling spot even as youth suicides are on the rise. It also had to cut paraprofessionals, all secretaries but one, and cooks’ helpers. After next year, school officials say there will be nothing left to cut.
• The McLaughlin Independent School District in South Dakota, which gets two-thirds of its budget from federal funding, has already implemented changes for the current school year: reducing staff to one teacher per classroom for grades three through five and cuts to the music program, P.E., and administrative positions. If Congress doesn’t end sequestration, it will have to close schools.

(Credit: NetChoice.org)

NetChoice, a “trade association of eCommerce businesses and online consumers” representing big tech names including Facebook, Yahoo, eBay, NewsCorp, Reed Elsevier, LivingSocial, and Aol, released a list of what it considers to be “the worst internet laws in America” — but many of the bills it targets would be good for consumers.

NetChoice’s May 2013 iAWFUL (“Internet Advocate’s Watchlist for Ugly Laws”) list rattles off eight types of proposals opposed by the group, many of which appear to be targeted because they may threaten the profit margins of the group’s constituent companies.

Here are three specific instances where the most recent iAWFUL list puts corporate interests before consumer rights or protections:

1. Accuses California privacy bills of being an “assault on the internet”: While NetChoice points out that some state-level privacy proposals in California have been conflicting, such as one that requires simplified, 100-word privacy policies versus another that requires privacy policies to be more detailed, the group also attacks a bill that merely gives consumers the ability to request what data about them has been given to which third parties and another that updates privacy requirements for mobile apps.
2. Claims state level data breach notification proposals would lead to “over-notification“: NetChoice opposes a number of state-level data breach notification laws that would require companies collecting personal or private information to notify consumers in a timely manner if their information has been accessed without authorization or breached, arguing they would place consumers at “greater privacy risk” because consumers become desensitized to data breach notifications.
3. Opposes Open Access initiatives that would give the public access to research: NetChoice takes aim at Open Access proposals, including the White House’s, saying they “could logically extend to assert state copyright over other content coming out of the state’s colleges and universities.” But what Open Access initiatives actually do is provide an remedy for freeing research funded by the public from a broken for-profit academic publishing system where all too often academics do research, pay for the privilege of being published in a journal, get edited by other academics pro-bono, and then the research is licensed back to academic institutions at a very high mark up. NetChoice member Reed Elsevier has actively lobbied against these type of proposals in the past, likely because its subsidiary Elsevier is the largest of the for profit academic publishers — reportedly earned over $1 billion in profits in 2011 with a profit margin around 35 percent and 71 percent of their revenue coming from academic customers like university libraries.

Credit: Associated Press

With odds stacked sky high against actually winning a jackpot, lottery players lose an average of 47 cents on the dollar for each ticket. With such low payouts, tickets act as an implicit tax of 38 percent.

Yet poor people are far more likely to buy tickets than their wealthier counterparts. They spend a larger percentage of their income on the lottery, and many studies of state lotteries have found that low-income Americans account for most of the sales and that sales are highest in the poorest areas. One study found that a reason for this is that “lotteries set off a vicious cycle that not only exploits low-income individuals’ desires to escape poverty but also directly prevents them from improving upon their financial situations.” The loss in income of buying tickets that provide no reward is harder to bear on a slim budget.

Those who win may not be much better off, however. The National Endowment for Financial Education estimates that as much as 70 percent of those who land sudden windfalls lose the money within several years. Lottery winnings have led some to drugs, bankruptcy, and family fractures.

The revenues from lottery tickets act as a regressive tax because states use them to fund many public services, such as education. Lotteries netted 11 states more revenue than their corporate income tax in in 2009. But states don’t fare well either in the long run. While states that have lotteries increased per-capita spending on education at first, after some time they ended up decreasing overall spending, while states without them increased investment. One study found that “nonlottery states spend, on average, 10 percent more of their budgets on education than lottery states.” In fact, lottery revenues may not end up increasing funds and could actually increase budget imbalances. There are only so many tickets that a state’s population can buy, making it a short or medium term fix but not a long term source of revenue.

The chances of winning the Powerball jackpot were very low at just 1 in 175.2 million. One person has likely won it and will now face the challenges of managing a huge influx of new money. The rest of the residents and the state’s revenues are not likely to fare as well.

Day-to-day oil transaction prices are based on benchmarks set by private firms, and the EU investigation focuses on the firm Platts, whose oil price benchmarks are “the most influential,” according to CNN Money. By manipulating individual transations late in a given day, traders can tweak the next day’s benchmark to increase their profits on other deals.

This looks to be very similar to last year’s massive, under-covered LIBOR scandal, in which megabanks colluded to gear a supposedly market-driven interest rate toward their own interests. CNN Money explains the shared pitfalls of basing daily price-setting on voluntarily-provided, unaudited data from the biggest players in the two industries:

“[T]hey are both widely used benchmarks that are compiled by private organizations and that are subject to minimal regulation and oversight by regulatory authorities,” the review, led by former financial regulator Martin Wheatley, said in August . “To that extent they are also likely to be vulnerable to similar issues with regards to the motivation and opportunity for manipulation and distortion.” […]

There are also concerns about the fact that reporting to Platts is done by traders voluntarily. In a report issued in October, the International Organization of Securities Commissions — an association of regulators — said the ability “to selectively report data on a voluntary basis creates an opportunity for manipulating the commodity market data” submitted to Platts and its competitors.

LIBOR manipulation impacts $800 trillion in assets globally. Similarly, oil prices are a core driver of the price of nearly every consumer good, especially food. LIBOR manipulation helped force massive cuts to public services in American cities by blowing up the balance sheets of those cities, and the apparent manipulation of oil prices is likely to have a similarly long and destructive reach.

The shared features of the LIBOR scandal and the burgeoning price-rigging investigation in the oil industry suggest a policy lesson: Left to themselves, the biggest industries in the world tend to cheat in their own interests, at great cost to consumers.

The LIBOR scandal, regarded as the largest financial fraud scandal in history, led to over $2.5 billion in fines and forced changes in the U.K. Under a law passed earlier this year, the process by which LIBOR is set will receive tighter government oversight from a new agency. But that change is insufficient, according to the American head of the Commodities Futures Trading Commission, and fraud remains a possibility.

These structural incentive problems crop up in myriad other markets. Finance expert Barry Ritholtz has a roundup of dozens of other types of market manipulation by insiders, far beyond oil and LIBOR. Privately and voluntarily generated core prices tend to discourage competition at the expense of consumers, as economist Costas Lapavistsas argued earlier this year in the Financial Times. “The answer,” according to Lapavistas, “is public intervention in the rate-setting process, whether through the central bank or otherwise.”

The plan sponsored by Sen. Kirsten Gillibrand (D-N.Y.) would force the U.S. Secretary of Education to automatically refinance most government loans carrying interest rates above 4 percent into fixed, 4-percent loans. Roughly nine of 10 federally-backed loans would be affected, saving nearly 37 million borrowers billions of dollars in annual interest payments.

“At a time when corporations, homeowners and even local governments are refinancing at historically low interest rates and saving millions of dollars, students and families who take out loans to pay for college are getting left behind,” Gillibrand said. “Ensuring that our graduates are not saddled with unmanageable debt by keeping interest rates low is just common sense.”

Holders of federal student loans haven’t seen a drop in their interest rates even as other borrowing costs have fallen. Many loans have interest rates of 6.8 or 7.9 percent, while the interest rate for the average 30-year, fixed-rate mortgage is 3.5 percent.

And as Sen. Elizabeth Warren (D-MA) recently pointed out, banks have even lower borrowing costs when they come to the federal government to borrow. They can get an interest rate of 0.75 percent on loans through the Federal Reserve discount window. Warren has also introduced a bill to address high levels of student debt by calling for student loan rates to mirror those that benefit banks.

Others have similarly taken recent action on the issue. The Consumer Financial Protection Bureau put forward a set of proposals that include allowing borrowers of federal loans to refinance to lower interest rates and to give them access to income-based repayment plans, as well as allowing the holders of private loans to enter rehabilitation programs. Sens. Jack Reed (D-RI) and Sherrod Brown (D-OH) have also introduced legislation to allow students debt borrowers to refinance.

The Center for American Progress estimated that Gillibrand’s legislation would save borrowers $14.5 billion in the first year, leading to a $21.7 billion boost in economic activity. Student debt is likely having a big impact on the economy, and it’s a big drag on the housing market in particular. Homeownership rates have fallen significantly for young graduates, as many can’t qualify for mortgages or afford down payments. The money they spend paying back their student loans would be enough to buy more than 155,000 homes.

Walker’s Department of Workforce Development released the new figures on Thursday, but they can’t be compared to other states until next month. Walker has been releasing the figures before they are published officially by the U.S. Bureau of Labor Statistics.

Critics say the state’s performance can’t be adequately measured until the numbers can be compared with other states. The most current ranking, comparing jobs created between September 2011 and September 2012, showed Wisconsin was 44th in the nation.

Walker is claiming a two-year total gain of 62,000 private-sector jobs, and a table on page 3 of the state’s report acknowledges the public sector is employing about 8,500 fewer people than it did the month before he took office. That puts the governor less than one quarter of the way to his campaign pledge of 250,000 total jobs created in four years.

If any independent organization would be likely to defend Walker’s record, it would be the conservative U.S. Chamber of Commerce. But the Chamber’s most recent annual scorecard of state economies has the state near the bottom in job creation, as the Madison Capital Times noted shortly after the report was released:

Its annual scorecard on state economies ranked Wisconsin 44th for overall economic performance and 50th — as in dead last — for short-term job growth as measured between September 2010 and November 2012. It also has Wisconsin 39th in “business climate” — on par with the state’s ranking under Gov. Jim Doyle.

Walker’s early-term agenda focused on busting public worker unions in the state and slashing state spending. His successes in pursuing those legislative goals amount to a localized version of the austerity approach to economic growth which Republicans have pressed with less success on the national level. Following the billions in budget cuts he pushed upon taking office, Walker has proposed both further cuts to school budgets and a tax cut that’s heavily slanted towards the state’s wealthiest residents.

Those policies have pulled demand out of the state’s economy, undermining Wisconsin’s growth prospects. Beyond the paltry jobs progress Walker is touting, U.S. Commerce Department figures show the state ranked near the bottom in terms of personal income growth over the 2011-12 period.

On Tuesday, Vermont Gov. Peter Shumlin (D) signed an equal pay bill into law. The new law will require employers to prove they have legitimate business reasons for paying workers unequal wages, protect workers who discuss pay with each other, provide protections for employees who request flexible work arrangements, give mothers who need to express breast milk at work protection, and improve the process that ensures state government contracts pay equal wages. It also establishes a study committee to look at instituting a paid family leave law.

New York may soon follow in Vermont’s footsteps. In his 2013 State of the State address, Gov. Andrew Cuomo (D) announced a Women’s Equality Agenda that is currently winding its way through the state legislature, and many of the provisions relate to women’s economic opportunities.

One would amend state law to make it explicit that pregnant workers are entitled to reasonable accommodations related to pregnancy and childbirth unless they would create a hardship for the employer. Women are often pushed out of their jobs or fired when they request accommodations like a stool, the ability to drink water on the job, or be given light lifting duties. On a recent conference call about the proposal, Dina Bakst, co-founder and co-president of A Better Balance, recounted the stories of New York women who experienced these responses, including a worker who was pushed out of her job at 17 weeks pregnant because her employer refused to modify a lifting requirement. She ended up in a homeless shelter thanks to the loss of income.

Another provision would prohibit employers from retaliating against employees who share wage information with each other and redefine what exceptions employers can cite for pay differentials so that they can only relate to job performance or business necessity. Yet another would amend New York State’s human rights law to provide explicit protections for workers who have children.

New York goes even further, though, by taking an intersectional approach to women’s equality. While statehouses across the country continue to consider a record number of bills that seek to limit women’s reproductive access, New York’s bill is the only current one that would expand it. The state’s existing laws regulate abortion in the criminal code and only allows for abortion care later in a pregnancy when a women’s life is at risk, not when her health is at risk. If the national precedent of Roe v. Wade were to be struck down, abortion care could be hampered, so the agenda seeks fixes to clarify women’s rights.

While it may seem unrelated to women’s economic opportunities, access to abortion care plays a big financial role in women’s lives. Women who aren’t able to get an abortion when they seek to terminate a pregnancy are three times more likely to fall below the poverty line within two years. Controlling fertility allows women to hold jobs and invest in their education.

New York and Vermont are following other state-level successes for equal pay laws. Texas passed its own Lilly Ledbetter Fair Pay Act to reform the constitution to allow workers more time to file a charge of discriminatory pay. New Mexico passed the Fair Pay For Women Act this year, which also eases the ability to bring cases alleging pay discrimination.

These bills are popular with both the general public as well as the business community. In New York, 84 percent want to enact equal pay legislation and 80 percent want to update the state’s abortion laws. The state’s chamber of commerce has also come out in support. Federal lawmakers may want to take note of the success of these efforts at the state level.

Massachusetts Sen. Elizabeth Warren (D) came out swinging against the repeal of new rules meant to regulate derivatives, the complex financial instruments that were at “the center of the storm” that caused the financial crisis. The rules shouldn’t be weakened or repealed just because big banks want to see them eliminated, Warren argued Thursday, The Hill reports:

“The big banks won some battles and lost some battles during the financial regulatory debate in 2009 and 2010, but their tune never changed and their lobbying never let up,” she said. “It is dangerous for Congress to amend the derivatives provisions of the Dodd-Frank Act without at the same time taking accompanying steps to strengthen reform and maintain the law’s equilibrium.”

One rule the package of legislation advanced by the House committee would eliminate is a “push out” provision that would limit derivatives trading at banks that receive federal backing. Similar to the Volcker Rule, another provision Wall Street largely opposes, it is aimed at making taxpayer-backed banks safer to avoid crises similar to the one that thrust the United States into a recession and led to a bailout of major banks in 2008.

Warren isn’t alone in her opposition to the rollback. The Obama administration has long opposed the repeal of the derivatives rules, and former Federal Deposit Insurance Commission chair Sheila Bair has said the swaps and derivatives rules need to be strengthened rather than weakened. Whether the rules will face a repeal vote in the Senate isn’t clear: the House passed similar legislation in 2012, only to see it die in the Senate without a vote.

Credit: The Economist

At noon on Friday, the Treasury Department began the latest round of accounting contortionism brought on by Republicans’ refusal to raise the debt ceiling. CNN Money explains that a financing mechanism to aid state and local governments will be the first casualty:

The debt ceiling clock is about to start running again. The U.S. Treasury on Friday will begin using “extraordinary measures” to keep the country from defaulting on its obligations. […]

It’s unclear how much time the extraordinary measures will buy, but Treasury Secretary Jacob Lew said last week the measures could last “at least” through Labor Day. Other estimates put the drop-dead date for raising the debt ceiling at sometime in October or even November.

The first move that Treasury will take is to temporarily stop issuing special securities to state and local governments as of noon on Friday.

Treasury calls these maneuvers “extraordinary measures,” but they have become routine since the GOP began dabbling in debt ceiling brinkmanship in the summer of 2011. That fight ended the precedent of legislators raising the ceiling as necessary for the past 50 years, including seven times under President George W. Bush. The GOP’s 2011 maneuver led Standard & Poor’s to downgrade its rating of U.S. debt for the first time in the nation’s history, but that didn’t stop Republicans from labeling the nation’s creditworthiness “a hostage worth ransoming.”

That attitude persists in 2013, as Senate Minority Leader Mitch McConnell (R-KY) indicated in March. Even with the deficit shrinking so rapidly that the Congressional Budget Office can hardly keep up, and with Republicans’ dire claims about debt levels hampering economic growth proven wrong, the GOP is reportedly mulling over what ransom to seek this year. After successfully extracting fiscal concessions in the past, however, its focus is sliding from spending toward conservative red meat.

At a House GOP meeting this week to decide what to demand, the Washington Post’s Lori Montgomery reports that proposals included tying the nation’s credit rating to the Keystone XL pipeline or the repeal of Obamacare, and that “at least one person wanted to take on late-term abortion.”

The provisions in the new rules include a variety of ways to improve quality and access:

• Implementing requirements for child care providers such as first aid and CPR training, background checks, and strengthened monitoring.
• Setting minimum standards for providers to comply with fire, health, and building codes.
• Providing parents with greater transparency about centers by making easy-to-understand information about the quality of care available.
• Facilitating the replication of best practices across the country and tracking the progress of those investments.
• Reducing unnecessary administrative burdens on families and improving coordination with other programs that serve low-income families.

Nearly 1 million low-income families who receive subsidies and the 1.6 million children served by the program will benefit directly, but other children who don’t receive the benefits also stand to see improvements. That’s because many children who don’t receive CCDF subsidies attend centers alongside those who do, so the new rules will impact approximately 500,000 centers.

Although each week nearly 11 million children under the age of five spend time in a child care setting, American centers often offer poor quality and safety. A 2007 survey found the majority of centers to be “fair” or “poor,” with just about 10 percent found to provide high-quality care. State oversight is also often lax. The latest comprehensive report on state requirements for centers found that none earned an A or B grade on training, safety, and health requirements and 20 states earned a failing grade. These federal requirements would help to raise standards across the board.

The CCDF program was last reauthorized in 1996 and hasn’t undergone significant changes in more than 15 years. The announcement comes as President Obama has also proposed $75 billion in spending to expand access to child care and preschool to American families. His proposal would similarly come with stricter requirements for quality and safety.

What is clear is that something started a fire in a seed room in the fertilizer and seed building, and the fire kept burning hotter, increasing the chances that ammonium nitrate at the facility would explode. When debris and equipment from the burning building made impact, it set off a detonation that in turn set off another. In total, about 28 to 34 tons of ammonium nitrate exploded with the power of 15,000 to 20,000 pounds of TNT. Most debris fell within 3,000 feet but some traveled as far as 2.5 miles.

This investigation has taken much longer than is usual: most last three to seven days, but the agency has spent a month looking into the causes and still has yet to determine the exact one. It has also spent nearly $1 million on the investigation in West.

That cost will be added to the estimated $100 million in property damage that the explosion caused, plus federal aid promised by President Obama. Yet because the plant only carried $1 million in liability insurance, many victims may not see their losses covered. Texas overall has the highest rate of workplace fatalities in the country and a high rate of fires and explosions, which come with very high costs: The fires and explosions at Texas’s chemical and industrial plants cost as much in property damages as in all other states combined. Overall, workplace accidents cost the economy around $250 billion a year.

Whether gaps in regulatory oversight might be to blame is also yet to be determined and is at the core of a separate, ongoing investigation by the Chemical Safety Board. What is clear, however, is that the plant hadn’t been inspected by the Occupational Safety and Health Administration since 1985, and it also slipped by six other regulatory agencies.

In introducing the amendment to protect SNAP funding, Democratic Rep. Jim McGovern (MA) noted that cutting food stamps comes with many expensive unintended consequences – hunger undermines worker productivity, and malnutrition increases medical costs – and that every dollar of spending returns much more than a dollar of economic output. In response, Republican Rep. Steve King (IA) alleged that the White House is seeking to swell the SNAP rolls in order to make Americans more dependent on government:

REP. KING: Handing out benefits is not an economic stimulator. But we wanna take care of the people that are needy, the people that’re hungry, and we’ve watched this program grow from a number that I think I first memorized when I arrived here in Congress, about 19 million people, now about 49 million people. And it appears to me that the goal of this administration is to expand the rolls of people that’re on SNAP benefits. And their purpose for doing so in part is because of what the gentleman has said from Massachusetts. Another purpose for that though is just to simply expand the dependency class.

Watch:

But the reality for SNAP recipients is far from King’s image of a “dependency class.” The Center on Budget and Policy Priorities explains that “only 4 percent that worked in the year before starting to receive SNAP did not work in the following year,” and adds that the raw total of recipients who work while enrolled in the program has tripled since 2000.

The think tank also notes that SNAP’s role as an unusually efficient stimulative multiplier is backed by Moody’s Analytics and the Congressional Budget Office.

Furthermore, the program keeps hundreds of thousands of vulnerable Americans out of the deepest pits of poverty, and even as the Great Recession swelled SNAP rolls, the program continued to push its erroneous payments rates to record lows:

Two of the Democrats on the Agriculture Committee — Ranking Member Collin Peterson (MN) and Rep. Mike McIntyre (NC) — joined Republicans in supporting the cuts, which will cause two million people to lose their benefits.

[There are] a whole array of other issues including the profligate waste in all sectors of the government as the administration attempts to vilify sequestration, a legitimate effort to cut 2.5 percent of the entire federal budget or about 7-8 percent of domestic and defense discretionary spending. At a time when the Department as purchased a new prison at a cost of $170 million when we have four new prisons all standing empty, and at a time when they are having $12 cups of coffee and $10,000 dollars pizza parties. So there will be questions there about why it is necessary to put deportable aliens, many of them criminal aliens, out on the street to save money where they can commit crimes against citizens of the U.S.

Goodlatte has expressed selective outrage over the budget cuts affecting immigration enforcement and airports. However, his home state Virginia will lose millions for primary and secondary education, affecting hundreds of teachers and 14,000 students, nearly $3 million for clean air and water services, child care for 400 children, vaccine services for more than 3,500 children, and much more. The Huffington Post also outlined 100 ways the sequester is hurting local communities across the country. But Goodlatte has zeroed in on the release of non-violent immigrants, who can be tracked through cheaper methods than detention at the cost of $164 a day.

This represents a marked change in the GOP’s tone on the sequester and a shift to blame the White House after forcing the sequester agreement in the first place. Reps. Mike Pompeo (R-KS), Raul Labrador (R-ID), and Blake Farenthold (R-TX) have downplayed how budget cuts have hurt everyday Americans to instead claim it is “working.”

Workers at New York City fast food chains have staged multiple one-day strikes in recent months, first in November and most recently in April. The strikes have centered on claims of low-wages, the lack of health and retirement benefits, and their inability to organize unions without intimidation from employers, and the survey’s numbers lend credence to their wage claims:

More than 8-in-10 employees (84%) report being victims of wage theft over the course of the last year; 66% report at least two abuses, 45% report at least three, and more than thirty percent of employees (31%) report being victims of at least four of these practices. Specifically:

• 36% of workers report being required to work while off the clock
• 32% of cashiers report being required to pay their employer if their register is short
• 30% of those who have worked 40+ hours in a week report they have not always received pay of time-and-a-half for overtime hours.

New York Attorney General Eric Schneiderman, a Democrat, recently launched an investigation into the practices of fast food owners and their parent corporations, the New York Times reported today. Schneiderman’s investigation is looking into claims made evident by the Fast Food Forward survey, including whether employers paid workers less than the minimum wage and failed to pay overtime. Schneiderman has previously brought claims against more than 20 companies for labor violations, according to the Times.

The abuses, however, aren’t limited to New York. Since workers there launched the first round of strikes in November, they have been joined by fast food and retail workers in Chicago, St. Louis, Detroit, and, most recently, Milwaukee, where workers held a one-day walkout Wednesday.

Following the London Whale trading scandal that cost JP Morgan at least $6 billion, Chairman and CEO Jamie Dimon is facing pressure from shareholders, who will hold a vote at the annual general meeting on May 21 to potentially split his roles. The failed trade originated from a trading desk that was meant to help the company reduce risk. It sparked a Senate investigation that ultimately concluded that the company misled regulators by mislabeling the portfolio of trades.

But rather than bring the hammer down on the head of the company, some are now potentially moving to vote against other shareholders who serve on the risk committee – Ellen Futter in particular, who is president of the American Museum of Natural History and a former director of AIG. At last year’s meeting, before the full effect of the London Whale trade was known, 14 percent of the vote was cast against her re-election.

While some shareholders may feel it is better to hold the risk management committee accountable and oust those who don’t have as much experience at financial institutions, Flutter’s expulsion would follow a disconcerting trend of laying the blame with women when things go wrong in the financial industry.

When the failed trade first surfaced, the first head to roll was not the London Whale himself, and Jamie Dimon managed to stay mostly insulated. Rather, the first person to step down was a woman: Ina R. Drew, JP Morgan’s Chief Investment Officer who was in charge of the division in which the trades were made. Drew was among the highest paid women in finance, being one of the top paid officials at JP Morgan. She has since been replaced by two men.

Similar resignations or firings happened during the chaos of the financial crisis. Erin Callan of Lehman Brothers and Zoe Cruz of Morgan Stanley were both high-ranking executives who may have been scapegoated when their companies faltered. This is what Michelle Ryan, an associate professor at Exeter University, has dubbed the “glass cliff”: “women often tend to occupy these dangerous leadership positions in dangerous times, when things are getting hairy,” she says. When things do go south, then, the women take the hit.

There were likely valid reasons for each of these women to be let go when they were. Drew, after all, oversaw the division making risky trades, although the risks of those bets were conveyed to top executives and dismissed. But they fit a trend in which female executives were three times as likely to lose their jobs in the recession.

Women already make up a small share of leadership positions in the United States, and in finance in particular. They hold 8.6 percent of executive officer roles in the finance and insurance industries and less than 20 percent of board director positions. If they are more likely to get ousted when a company hits troubled times, those numbers will continue to be depressed.

The background here stretches back to a 2010 decision by the Supreme Court holding that the NLRB is powerless to act unless it has a quorum of at least three members. The NLRB has exclusive jurisdiction over what are known as “unfair labor practices,” meaning that it is the only body of government permitted to enforce much of federal labor law. If the NLRB is powerless to act, there will be no one to enforce workers’ rights to join a union without intimidation from their employer. No one to enforce workers’ rights to join together to oppose abusive work conditions. And no one to make an employer actually bargain with a union. Without an NLRB to enforce the law, it may be possible for an employer to round up all of their pro-union workers, fire them, and then replace them with anti-union scabs who will immediately call a vote to decertify the union.

This reality gave Senate Republican filibusters of President Obama’s NLRB nominees a special aura of danger. When the Senate minority filibusters nominees to a powerful court, the other judges on that court can continue to issue decisions (even if those decisions are likely to reflect the ideological preferences of past presidents). If senators filibuster most agency heads, the agency’s remaining staff can maintain its day to day operations. But if a filibuster blocks confirmations to the NLRB, a sweeping array of workers’ rights simply cease to exist.

To ward this off, President Obama recess appointed three people to the NLRB nearly a year and a half ago. A panel of Republican-appointed judges on the United States Court of Appeals for the D.C. Circuit struck down those recess appointments earlier this year. And, today, two more Republican judges voted to strike down the same appointments (an Obama appointee on the same court voted to uphold them).

While the rationale behind the these two court decisions is somewhat different, it’s not clear how much legal arguments actually matter in a case like this. The bottom line is that every Republican judge to consider the matter has now struck down President Obama’s appointments. There are five Republicans, and only four Democrats on the Supreme Court. That’s probably all you need to know if you’re placing bets on how the justices will resolve the case.

So five Republican justices are likely to uphold the two decisions blocking recess appointments. Without recess appointments most of federal labor law ceases to exist until the seats on the NLRB are filled — indeed, some 1,400 NLRB decisions may be retroactively invalidated. Without federal labor law, nothing prevents employers from engaging in the most ruthless purges of unions seen in this country since before the New Deal. And all that Senate Republicans need to do to maintain this status quo is to keep filibustering President Obama’s nominees.

Recently, several Senate Democrats, including Senate Majority Leader Harry Reid (D-NV) raised the idea of a second round of filibuster reform to ensure that Senate Republicans do not have the power to unilaterally obstruct nominees. If Reid cannot assemble the 51 votes he needs to enact such reforms, then every Democrat who opposes filibuster reform has likely voted to strip workers of their rights.

Credit: The Associated Press

Many other American retailers have yet to sign on, including Walmart and Gap. Gap has voiced concerns that the plan could be used to sue it in American courts and Walmart objected to governance and dispute resolution mechanisms. Walmart announced on Wednesday that it would instead use its own voluntary plan that includes inspecting all of its Bangladesh facilities and providing fire safety training to workers. Gap also sent a letter to employees at its headquarters saying that it has hired a fire inspector to examine factories in Bangladesh and will commit $22 million in loans to factories to make upgrades.

Meanwhile, other retailers are already looking to pull operations in Bangladesh and move them to other countries. The New York Times reports that Western executives are looking into sourcing production in Vietnam, Cambodia, and Indonesia. But pulling operations out of Bangladesh could only harm workers further:

Garment manufacturing makes up a fifth of the economy in Bangladesh and four-fifths of its exports, which means that one of the world’s poorest, most densely populated countries is desperately dependent on continued export orders to stave off soaring unemployment and possibly further political unrest. Some executives say that many multinationals will continue buying from Bangladesh, although some may diversify their orders to more countries.

Executives may also struggle to find safer working conditions elsewhere. A shoe factory in Cambodia collapsed on Thursday morning, killing two workers and injuring seven. An initial investigation showed that the ceiling lacked the materials to support heavy weight.

Rather than pulling operations, some companies are indicating that they will stay and make further investments in the country. In an interview on Wednesday with the Financial Times, H&M CEO Karl-Johan Persson said he supports Bangladesh’s recent announcement that it would raise the minimum wage for garment workers, saying that he wants salaries to be revised yearly. The company has also agreed to pay as much as $500,000 per year toward factory improvements and inspections by signing onto the safety agreement.

Although some retailers fear the costs of upgrades, they could pass them on entirely to consumers and only raise prices by 10 cents per garment.

A new report from the House Appropriation committee Democrats found that the Forest service “will have 500 fewer firefighters, 50-70 fewer fire engines, and two fewer aircraft because of sequestration.” Some of the equipment it does still have is outdated — such as the 50-years-old-on-average tanker planes that have crashed multiple times in the last decade, killing 14 people.

A Fox News radio AM talk show expressed incredulity that President Obama and Agriculture Secretary Vilsack “could not find $115 million of fat in the budget so they cut firefighters.” One of the more harmful aspects of sequestration is that the cuts take place “across-the-board” and do not permit the same flexibility in moving funds around within an agency.

Because last year’s wildfire season was so severe, the USDA Forest Service faced a $400 million shortfall for active firefighting and had to borrow money from fire prevention programs to cover the costs. These programs included paying for brush removal from public lands and protecting against invasive plants, disease, insect infestations, and fires. Eventually Congress reimbursed the Forest Service for the shortfall via the 2013 Continuing Resolution but the delays hurt prevention efforts. Last year’s fire season consisted of 67,700 fires burned 9 million acres.

This year, as of May 3, there have been 13,115 wildfires, burning 153,000 acres. Compounding the restraints posed by the inflexible sequester, agencies foresee a $700 million deficit in direct firefighting activities, so similar programs will be de-funded (such as a hazardous-fuels-reduction program to remove long-burning combustible materials from the path of fires).

Congress calculates wildfire suppression funds by averaging the cost over the last ten years. As climate change worsens drought year after year, this calculation becomes deficient. The wildfire season used to range between June and September, but has now expanded to include May and October.

The Western U.S. faces low mountain snowpack, and the most recent U.S. Seasonal Drought Monitor Outlook finds that “drought is forecast to either develop or persist across the western contiguous U.S. as this region enters its dry season.”

Dry conditions in nearly half the country make hampered fire management budgets and sequestration cuts even more dangerous for residents and will lead to even more shortfalls this season. A recent report found that climate change will double the area burned by wildfires by 2050.

Drought and wildfires, in addition to harming people and property, also have dramatic impacts on insects like monarch butterflies, as well as mammals, birds, reptiles, and nearly every plant in the region.

Local communities are trying to face climate adaptation issues alongside the federal government. Texas is preparing for record drought by creating a “rainy day” infrastructure water fund, though none of the legislators acknowledge that climate change is a primary cause of increasing droughts.

A recent report from the General Accounting Office found that the federal government needs to do a better job helping local governments adapt to climate change and integrate climate impacts into infrastructure planning. The report identified roads, bridges, wastewater systems, and federal facilities as particularly vulnerable. Sequestration makes it nearly impossible for the federal government to help local communities adapt to and prepare for climate change-fueled extreme weather and wildfires.

Photo credit: The Memphis Flyer

A report out today from the Democrats on the House Appropriations Committee shows costly new flaws in Congress’ approach to fiscal policy. Beyond providing updated information on the anticipated impacts to specific programs from the across-the-board spending cuts known as sequestration, the report shows Congress’s piecemeal approach to “fixing” sequestration is more than just unfair – it’s costing the U.S. more money.

Since the threat of sequestration failed to spark a spending compromise and the haphazard slashing began, lawmakers have faced uneven amounts of pressure to replace chunks of sequestration cuts from varying groups. The success of that pressure seems to hinge on the political influence wielded by the group affected by a given cut. Unemployment beneficiaries, Head Start students and parents, 140,000 families on housing assistance, and seniors who rely on Meals on Wheels, among many other politically marginalized groups, have received no relief from sequestration.

Business travelers, on the other hand, have seen their outcry over airport delays due to sequestration yield a “fix” for the Federal Aviation Administration.

Today’s report goes beyond that unfairness to explain how the piecemeal “fix” to avert flight delays is actually raising the economic costs of aviation delays, by tens of billions of dollars:

The [Reducing Flight Delays] Act [of 2013] allowed the FAA to apply sequestration to the Airport Improvement Program (AIP), which had been exempt in the original sequestration order. […]

Cutting the AIP program slows FAA’s ability to meet construction needs. FAA estimates that development needs at eligible airports will exceed $42.5 billion over the next five years. The American Society of Civil Engineers 2013 “Report Card for America’s Infrastructure” rated our aviation system a “D,” estimating that the cost of congestion and delays to the economy will rise to $34 billion in 2020 (up from $22 billion in 2012), and that “D” grade assumes we continue to spend at current funding levels — before sequestration.

Even before Congress gave the FAA permission to halt all airport construction funding, America faced a $12 billion increase in the economic drag caused by aviation congestion. Now that cost is going to swell.

These can-kicking costs come on top of the more immediate damage sequestration will do to the economy: 700,000 fewer jobs and a 0.6 percentage-point reduction in GDP growth for the year. The Huffington Post reported several of the mechanical details of individual agency responses to the cuts contained in today’s House report, including 500 fewer firefighters at the Forest Service and a shrunken stockpile of vaccines at the Centers for Disease Control and Prevention.