Thursday, July 22, 2010

Signs Of The Times

Driving around town from one meeting to the next today, I ran across a crowd of about 200 holding a rally in front of the Wachovia/Wells Fargo Bank at Atlantic Station. In addition to signs simply saying "Foreclosed," other signs read "When Bankers Cheat, Families Are Dumped On The Street," and "Wachovia/Wells Fargo Guilty Of Ripping Off The Poor & Seniors."

The protesters were demanding fair treatment of people facing foreclosure, including loan modifications that reduce principal and interest, and for the banks to make low interest loans available to communities. As of May 2010, Wells Fargo had only permanently modified 40,579 mortgages, while an estimated 182,067 mortgages are eligible for the federal Home Affordable Modification Program. Wachovia has an estimated 31,084 eligible mortgages, but had only permanently modified 1,211 or 4%.

This protest is not untypical for any American city these days. Unemployment is around 9.5 percent nationally, slightly higher in Georgia. People who have jobs are afraid to leave them. The housing market is recovering slowly, but millions of Americans are still facing foreclosure despite being employed full time. This crisis has cost us approximately 8 million lost jobs and $17 trillion in lost retirement savings and net worth.

The House and Senate are set to vote on an extension of unemployment insurance benefits this week that would last until Nov. 30. This measure would offer continued assistance to about 2.5 million unemployed Americans whose benefits have run out. Republican leaders in both chambers oppose it on the grounds that extending these benefits will unacceptably increase the national budget deficit. Rep. Raul M. Grijalva (D - Arizona) offered the following comments on this situation in the Huffington Post:
Let's put the GOP's version of fiscal responsibility in context. The House-Senate compromise bill extends federal funding for unemployment benefits for four months. The final cost is expected to be about $34 billion. Compare that to the combined cost of a single month's military presence in Iraq and Afghanistan: $12.2 billion in February, according to Pentagon figures. As I write this, our presence in Iraq has cost us $734.5 billion - the number will be higher by the time you read it. The figure in Afghanistan is $284.6 billion.

Which is the more responsible path? We can tell our unemployed neighbors "Tough luck, you're not trying hard enough," or we can start looking at the real reasons for our budget anxiety. Any member of Congress who claims to be fiscally responsible can't turn that responsibility on and off like a faucet. The costs of our wars - not to mention the unnecessary defense contracts that have no bearing on national security - are a blight on the national ledger. But no supposed deficit hawks have been willing to say as much. Instead, the unemployed just need to tighten their belts, be more responsible and suck it up.

There's another important comparison to that $34 billion figure: the cost of fully extending Bush-era tax cuts, as Republican leaders in the House and Senate have called for. Those cuts were enacted with sunset provisions that will make them expire at the end of this year. Republicans don't want to let that happen, even for the major tax cuts on the top few income brackets. According to the Joint Committee on Taxation, extending the cuts would add $2.56 trillion to the deficit by 2020. Even Alan Greenspan, one of the architects of Bush's fiscal policies, now believes they should be ended. As he said in a July 17 interview on Bloomberg TV, Congress "should follow the law and let them lapse. . . . The problem is, unless we start to come to grips with this long-term [budget] outlook, we are going to have major problems."

Again, which is more responsible: spending $34 billion to make sure people have grocery money, gas money and enough to keep a roof over their heads for another few months, or spending $1 trillion on two wars without any exit strategies and $2.5 trillion on tax cuts that were designed to end in the first place? It's no contest. Yet those who want to help the unemployed are tarred as irresponsible, out of touch and not to be trusted with the federal budget . . . Those who don't want to extend benefits often paint unemployment insurance recipients as lazy, unmotivated slackers who just need to get off the couch. This may be a comforting illusion if you oppose unemployment assistance for ideological reasons, but it's nowhere near the truth. The reality is much harder to face.
Right now, there are five unemployed people for every available job nationwide. Far from being lazy, unemployed job seekers are having to hustle like never before just to stay ahead of the next guy in line. What are we going to tell them? We can't afford to lend them a helping hand when the economy crashed due to no fault of theirs?

No wonder they're picketing out on the streets.

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