Why Student Debtors Go Unrescued – The New York Times

“A vast majority of the more than 10 million Americans who have defaulted on or are behind on repaying their student loans could have benefited from income-driven repayment plans that are intended to ease pressure on distressed borrowers and keep them from defaulting on their federal loans.These plans can allow borrowers with low income or high debt — or both — to pay less each month, or even nothing, until their finances improve without being penalized or going into default. But many borrowers never even hear about these payment plans, thanks to poor customer service by the companies that are paid more than $600 million a year by the government to manage these accounts, process monthly payments and enroll distressed borrowers in alternative repayment plans.”

Source: Why Student Debtors Go Unrescued – The New York Times

Here is a comment from the Times which I suport:


Maine 52 minutes ago

“Student loan companies are not “failing” borrowers. They’re intentionally obfuscating, mismanaging information, or flat-out lying to borrowers in order to keep them trapped in debt bondage forever. Go ahead and look up the consumer reports of any major debt servicing company. They are filled with tales of grift and harassment; companies that just happen to “lose” huge amounts of money paid towards a principal or that conveniently forget about payment plans in which their borrower participates. In the meantime, these companies can sell massive debts to one another at pennies on the dollar, while charging interest rates that break the orbit of our now permanent zero interest rate policy.

We are way past the point of effete “oversight.” These deadbeat companies should be nationalized, their assets should be redistributed to the borrowers that they have defrauded, and their execs should stand trial. Or, we can wait for this problem to manifest itself, once again, in the streets. ”

An Unreliable Germany and the Volkswagen Debacle – Roger Cohen,The New York Times

“Germany’s leading company has toyed with the air people breathe. That’s shocking. In historical context, it’s devastating.The Volkswagen scandal elicits more than dismay. It is one of those moments when the entire culture of a nation — in this case one of scrupulous honesty, acceptance of rules, reliability, environmental sensitivity and atoning dedication to the common good — is called into question.Germany is never quite what it seems. There is a strain between its order and its urges. Formality may mask frenzy. When things go wrong, they tend to go wrong in a big way.”

This is an interesting piece, persuasive and subtle, but the commentators rip it to shreds for unfairness. I have collected the piece at my blog, LindsayOnVietnam.wordpress.com as an example of persuasive journalism, that might be terrible over-reaching. The commentators argue that it is absurd to take one corporate miscreant, and draw conclusions about an entire nation. As an analyst, I sometimes feel like a ping pong ball, going from one strong argument to its critique. Though I was captivated by his critics, I suggest that Roger Cohen is on to something sad and profound, though he didn’t throw out enough caveats. It is hard to discuss complex grey matter in 800 words.

The only exciting thing about the horrible Volkswagon story, is that it makes a gigantic case for strong government regulation and criminal penalties to protect the public from corporate malfeasance. So, one might argue that Roger missed mentioning the hottest part of the story. Cohen might be right however, that there might be something German about the size and scope of this epic-sized fraud. It is hard to believe in a free country, that there would be no whistleblowers over such a huge scam, that hurt the public’s health so seriously.

Source: An Unreliable Germany and the Volkswagen Debacle – The New York Times

Dewey, Cheatem & Howe Recent cases of disturbing business practices underscore the need for good regulation, which is at stake in next year’s election. nytimes.com|By Paul Krugman

Paul Krugman: “No doubt I, like anyone who points out ethical lapses on the part of some companies, will be accused of demonizing business. But I’m not claiming that all businesspeople are demons, just that some of them aren’t angels.

There are, it turns out, people in the corporate world who will do whatever it takes, including fraud that kills people, in order to make a buck. And we need effective regulation to police that kind of bad behavior, not least so that ethical businesspeople aren’t at a disadvantage when competing with less scrupulous types. But we knew that, right?”

Recent cases of disturbing business practices underscore the need for good regulation, which is at stake in next year’s election.
nytimes.com|By Paul Krugman

After Volkswagen Revelation, Auto Emissions Tests Come Under Global Scrutiny – The New York Times

“In the United States, as attorneys general across the country opened investigations, Dan Becker, director of the safe climate campaign at the Center for Auto Safety, said the country also needed to rethink how emissions were tested. Independent testing has shown a widening gap between results in laboratories and the real world, raising suspicion.“The automakers have proven that they’re not trustworthy,” Mr. Becker said. “The government has to overhaul the testing to make sure that independent parties ensure that the cars that are put on the road pollute less and are safe.” ”

Source: After Volkswagen Revelation, Auto Emissions Tests Come Under Global Scrutiny – The New York Times

NYT: The Fight for Health Care Isn’t Over

NYT editorial last Sunday: “In light of these lines of attack, it is imperative that in 2016 voters elect people to Congress and the White House who will support health care reform. It is equally important that as many uninsured people as possible be reached and enrolled in private plans or Medicaid. The greater the number of people who benefit from the health reform law, the harder it will be to dismantle it.”

It is imperative that in 2016 voters elect people to Congress who will support health care reform.

Paul Krugman in NYT: Wall Street Vampires

Paul Krugman starts this piece in the NYT with:
“Last year the vampires of finance bought themselves a Congress. I know it’s not nice to call them that, but I have my reasons, which I’ll explain in a bit. For now, however, let’s just note that these days Wall Street, which used to split its support between the parties, overwhelmingly favors the G.O.P. And the Republicans who came to power this year are returning the favor by trying to kill Dodd-Frank, the financial reform enacted in 2010.

And why must Dodd-Frank die? Because it’s working.”

The plot against financial reform continues, despite the fact that one important measure is actually working.
nytimes.com|By Paul Krugman

Law Professor Tim Wu, the courts have moved to give corporations the same protections as individuals

Here in lies some direction on how to handle the problem in the previous post. According to law professor Tim Wu, the courts have moved to give corporations the same protections as individuals, when that protection was invented recently, to avoid regulation. There are numerous examples in his article in the New Republic.There is now a legal lottery to roll back reforms. “The U.S. Chamber of Commerce is pushing to gut the disclosure requirements in new securities regulations, citing the free speech rights of hedge funds and publicly traded companies. Attorneys working for Google have argued that, since search results are speech, its rights are impinged by the enforcement of tort and antitrust laws. Southwest and Spirit airlines have employed the First Amendment to resist efforts to force them to list the full price of tickets. The incomplete, misleading cost, they have argued, is a form of free speech, too.”
Wu goes through the history of the legal evolution. Oddly, the great conservative Justice Rehnquist foresaw this abuse and warned against it. Wu Wrote, “The minority opinion in the First National case strenuously made these points: “ ‘A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law,’ ” Justice Rehnquist wrote, quoting John Marshall. He added that “liberties of political expression are not at all necessary to effectuate the purposes for which States permit commercial corporations to exist.” But the precedent had been established.”

If our democracy fails, this evolution might be cited as a major cause. Somehow, we have to make consumer protection laws more legal than the right of corporations to lie and cheat and pollute.

How big business hijacked the First Amendment.

NYT: First Amendment, ‘Patron Saint’ of Protesters, Is Embraced by Corporations

Here is a major legal problem. What is the solution?

“Corporations have begun to displace individuals as the direct beneficiaries of the First Amendment,” a law professor writes in a provocative new study.
nytimes.com|By ADAM LIPTAK

NY State found that four out of five of the products did not contain any of the herbs on their labels.

Yuck. I hate intentional food poisoning. “The authorities said they had conducted tests on top-selling store brands of herbal supplements at four national retailers — GNC, Target, Walgreens and Walmart — and found that four out of five of the products did not contain any of the herbs on their labels. The tests showed that pills labeled medicinal herbs often contained little more than cheap fillers like powdered rice, asparagus and houseplants, and in some cases substances that could be dangerous to those with allergies.”

The following brands had many phonies with junk on the shelf.

GNC’s Herbal Plus, Target’s Up & Up, Walgreen’s Finest Nutrition, Walmart’s Spring Valley

GNC, Target, Walgreens and Walmart were accused of selling fraudulent and potentially dangerous herbal supplements and told by New York State officials to stop…
well.blogs.nytimes.com|By Anahad O’Connor

It is a rule of thumb, consumers get screwed.

It is a rule of thumb, consumers get screwed. From today’s NY Times editorial:
But it doesn’t take an investigation to figure out that higher airfares are the direct result of reduced competition. Consumer advocates clearly warned that allowing mergers like the 2013 American Airlines-US Airways combination would harm consumers. This is exactly what is now happening.”

Oil prices have fallen and eased prices at the gas pump for drivers, but airfares haven’t nudged a bit.