Democratic Coalition Against Trump
“Far too many have suffered the consequences of global warming in recent months, and the political response has so far been woefully inadequate—and the denial is just evil.” — Patagonia CEO Rose Marcario
Read About The Tarbaby Story under the Category: About the Tarbaby Blog
“Far too many have suffered the consequences of global warming in recent months, and the political response has so far been woefully inadequate—and the denial is just evil.” — Patagonia CEO Rose Marcario
It will take our planet 3 million years to recover.
📕 Read more: https://wef.ch/2RTLCcU
Scientists say humans are causing Earth's sixth mass extinction
It will take our planet 3 million years to recover. 📕 Read more: https://wef.ch/2RTLCcU
Posted by World Economic Forum on Monday, March 25, 2019
School lunches carry a small price tag, but for low-income families the cost can add up—and despite efforts to stop lunch shaming, some schools punish children who can’t pay.
By Nadra Nittle, Food Justice, School Food May 21, 2019
These are all examples of lunch shaming, a practice that may vary depending on the context, but which has persisted for years. Outcry about the issue has grown louder since the Great Recession, when a number of school districts found themselves in a financial crunch and began using punitive measures to settle meal debt.
“States have described a point in which school lunch programs needed to start standing independently as a ‘business unit,’” said Jessica Webster, staff attorney of the Mid-Minnesota Legal Aid Legal Services Advocacy Project. “They couldn’t run in the red anymore because districts could no longer cover the debt. So, we saw a surge in a la carte foods and competitive foods like pop, candy, and Taco Bell to cover those debts. But when parents started asking for bans on these competitive, unhealthy foods, school lunch programs could no longer cover the shortfalls.”
The result has been lunch programs across the country making headlines with a variety of lunch shaming practices, which in turn has led to a movement largely focused on fundraising and legislation as remedies. While many Americans remain unaware of this problem, when stories of lunch shaming hit the headlines or go viral, people have begun to spring into action.
For example, when Warwick Schools in Rhode Island announced earlier this month that children with delinquent lunch tabs would be served cold sun-butter and jelly sandwiches (with veggies, fruit, and milk) instead of hot menu items, it sparked a fierce backlash. In just one week, the public raised the $77,000 needed to wipe out the lunch debt Warwick had accrued. To date, two GoFundMe campaigns and Chobani Yogurt CEO Hamdi Ulukaya have raised more than $150,000 to clear Warwick’s student lunch debt and then some, but this development by no means provides a meaningful solution to the student lunch debt that’s ballooning across the country.
Some states are seeing school lunch debt soar into the millions of dollars, but the exact amount of lunch debt schools nationwide have accumulated collectively isn’t known because the U.S. Department of Agriculture doesn’t collect or provide that data. As an issue that disproportionately involves marginalized families—those in poverty, living paycheck to paycheck, or even undocumented immigrants afraid to participate in the federal free lunch program—lunch debt magnifies the widespread economic and structural inequities that have historically existed in the U.S. It also has a very real effect on children—whether causing them go hungry (since school meals are the only meals some children eat in a day), hurting their self-esteem, or both.
The acts of shaming that accompany lunch debt may be hard for children to shake, according to Bettina Elias Siegel, a Civil Eats contributor and author of the forthcoming book, “Kid Food: The Challenge of Feeding Children in a Highly Processed World.”
“Children are so aware of differences between kids—whether it’s socioeconomic, popularity, or whatever—that when you engage in any practice expressly meant to set them apart, kids feel that keenly,” Siegel said. “The stigma is real; it’s a really unfortunate tactic.”
She added that lunch shaming also exacerbates existing socioeconomic differences in school cafeterias in which more privileged students can buy a la carte items while their less privileged peers eat standard lunches.
Various states and school districts have taken measures in recent years to do away with lunch shaming policies that saw youth with past-due lunch accounts relegated to eating cold snacks or nothing at all. In some cases, students performed cafeteria chores to work off their debts or had to wear stickers or hand stamps that called out their past-due account status. As state legislation and other protections have been put into place to avoid shaming students, lunch debt continues to grow, and schools may still take punitive measures against families to resolve these bills—from sending debt collectors after them to threatening to stop students from graduating.
Student lunch debt carries consequences that may extend well beyond a child’s K-12 education. To adequately address this issue, student advocacy and anti-poverty groups say schools must improve how they communicate with parents, families need to be better educated about children’s options for lunch, and Congress may need to pass federal legislation. Donations to erase lunch debt, however, remain a quick fix to a complex and ongoing problem.
“I wish we could channel all that fundraising into a broader effort to advocate at the national level for [universal] free lunch.” Siegel said. “We supply books for children. We provide buses to get them to school. By the same token, we should be supplying kids a free lunch.”
In 2017, Denver Public Schools made a widely applauded announcement: It would no longer deny hot meals to students with negative meal balances. But its goal to make sure that none of the 92,000 children in the district was left eating a cheese sandwich or graham crackers and milk—its previous policy for students with unpaid lunch bills—faced an unexpected drawback. School lunch debt in Denver shot up from $13,000 during the 2016-17 school year to $356,000 the next.
After the passage of a 2017 anti-lunch shaming bill that requires cafeteria staff to feed all students, Oregon schools have experienced a similarly exponential growth in lunch debt. The law also prevents school workers from asking children to pay for food. By the end of 2018, more than three dozen districts in the state had racked up $1.3 million in unpaid balances.
Rising lunch debt isn’t unique to Oregon or Denver, however. According to the School Nutrition Association, a nonprofit that represents student meal providers, school lunch debt is widespread across the country. Its 2018 School Nutrition Operations Report found that 75.3 percent of school districts had unpaid meal debt at the end of the 2016-17 school year, up 4 percentage points from four years earlier.
The rise has occurred during a period in which states including New York, Iowa, New Mexico, California, Minnesota and Texas have enacted legislation to crack down on lunch shaming, and do-gooders have collected money to help school districts clear student lunch debt. A fundraising campaign and a private donation wiped out Denver Public Schools’ $13,000 lunch debt from the 2016-17 school year. More recently, community members in Wisconsin, Minnesota and Michigan rallied to cover student’s unpaid lunch bills during the 2018 holiday season.
And just in time for 2019’s commencement ceremonies, the Philando Castile Relief Foundation made an $8,000 donation to erase the lunch debt of students at Robbinsdale Cooper High School in suburban Minneapolis. Castile, a Black man whose 2016 killing by police in Falcon Heights, Minnesota, sparked nationwide protests, was a cafeteria supervisor at a Minnesota Montessori school. He routinely paid for lunch for students with overdrawn meal accounts, and the foundation named after him continues that legacy.
Students are also on a mission to solve the problem of lunch debt in schools. Last December, an Orlando, Florida, fifth-grader donated $100 of his earnings to pay for unpaid lunch bills at his elementary school. In 2017, Palm Beach County high school student Christian Cordon-Cano started the nonprofit School Lunch Fairy to cover student meals all over the country. So far, he has raised more than $72,000 for that purpose. He told Civil Eats that he got the idea for his nonprofit after listening to a radio broadcast about lunch debt.
“I went to a private Christian school and lunch shaming had never crossed my mind,” said Cordon-Cano, now a college freshman. “I was so shocked that I thought I had to do something about lunch sharing. Every kid deserves a good lunch, so to me, to embarrass them, it’s very sad.”
The School Lunch Fairy website takes donations from members of the public who want to help schools get rid of lunch debt. But Cordon-Cano said that some schools have turned down his organization’s efforts to clear their meal debt.
“Some districts didn’t want help, but they would never give reasons,” he said. “I think the amount of debt they were in embarrassed a lot of them.”
Warwick Schools in Rhode Island reportedly turned down a $4,000 donation from a local restaurant owner because the donation would only cover a fraction of the total amount of lunch bills due. In a statement, the district said it was grateful for the financial support but needed to figure out a way to determine which students’ bills to pay. “We are working with our attorneys to ensure that we accept donations in compliance with the law and that the donations are applied in an equitable manner.”
In 2017, Texas State Rep. Helen Giddings, the lawmaker behind anti-lunch shaming legislation that requires schools to grant students a grace period before giving them a meal alternative and to contact parents when a child’s meal account is depleted, partnered with Austin nonprofit Feeding Texas, a state network of food banks, to raise more than $216,000 to cover unpaid lunch bills.
“It’s obviously just a stopgap, a band-aid on a bigger problem. Kids not having food to eat—that’s not a problem that can be solved locally with a GoFundMe campaign,” said Feeding Texas CEO Celia Cole. “We raised the money to be able to make grants to school districts, to incentivize them to make better policies, but it wasn’t a permanent solution, and we weren’t in a position to fundraise year after year.”
Feeding Texas is working with the state’s Department of Agriculture to survey districts about why they’ve accumulated student lunch debt in hopes of finding remedies, especially making free lunch accessible to the families who qualify for it.
“The process of connecting students to meals isn’t perfect,” Cole said. “We’re a very big and very diverse state, so there isn’t an immediate policy fix. We’re not discouraging people from fundraising, and we see the outpouring when people hear about student lunch debt, but it’s not a long-term fix.”
Lunch debt can be reduced, in part, by making sure that parents know the options available to them. At least some of the lunch debt that schools incur stems from families who qualify for free and reduced lunch, which is paid for by the federal government, but don’t sign up for the program. They may find the paperwork too confusing, only register one of their children, or forget to reapply annually, school nutrition advocates say. Language barriers may also get in the way, and undocumented families may be too fearful to fill out any paperwork at all.
Students from households where the total income falls below $32,630 annually for a family of four—qualify for free lunch. (A family of four earning under $46,435 is eligible for a reduced-price meal.) However, when families who do qualify for free and reduced lunch meals finally sign up for the federal program, any lunch debt they accrued beforehand doesn’t disappear.
“The really unfortunate thing about all of this is that the federal government prohibits schools to use federal funds for any unpaid meal debt,” explained Diane Pratt-Heavner, a spokesperson for the School Nutrition Association. “The free meal program relies solely on federal reimbursement. There is no funding for students who aren’t enrolled [but eligible to be] in the free-and-reduced lunch program.”
That’s why it’s imperative that school districts don’t wait until a family is significantly behind on their payments to take action. Signing up parents early and annually prevents lunch debt from ballooning. In some cases, families who qualify for the reduced portion of the program still struggle. This has led some children’s advocates to recommend doing away with the reduced category altogether.
“At the reduced price, families might pay 40 cents for lunch,” said Crystal FitzSimons, director of school and out-of-school time programs for the Food Research & Action Center. The average school lunch costs about $3.20. “That may not seem like a lot of money to cover, but it can add up.”
Families who qualify for reduced meals but not free ones aren’t as likely to participate in the federal meal program at all, FitzSimons said. Offering these families free meals could lower schools’ lunch debt burden.
Sometimes schools don’t take advantage of the options available to them, such as the federal community eligibility provision. This allows schools that serve mostly low-income youth to provide free meals to each student without the need for families to provide paperwork. During the 2016-2017 school year, 9.7 million students ate free school meals through the provision, but only about 55 percent of schools that qualified to receive it participated. The nation’s biggest city, New York, stands out for offering free meals to all students.
“Advocating for universal free meals in high-poverty areas—that’s the solution,” said Pratt-Heavner of school lunch debt. “If the federal government realizes it, along with the school districts, they should be able to make sure kids get these meals.”
Students who live in states that have passed anti-lunch shaming bills may no longer worry about having their meals thrown out in front of them or other frowned-upon practices, but their families are still subject to bill collectors. Starting in January of this year, Cranston Schools in Rhode Island turned to a debt collection agency to recover the money owed from unpaid lunch bills.
Jessica Bartholow, a policy advocate for the Western Center on Law & Poverty in California, said schools routinely send bill collectors after families, but she questions whether student privacy laws are being broken in the process.
“There’s a real problem with a school that gives a third party information about a child and the child’s debt,” she said. “The information would have to include the name of the child and the action that caused the debt—and would also have to include the address of the person responsible for the child.”
In January, California Assembly Bill 1974 took effect; the legislation enacts the Public School Fair Debt Collection Act and prevents unemancipated minors from being held accountable for school debt, lunch-related or otherwise. It also prevents schools from withholding transcripts, diplomas, or similar items from students because of debts owed. While debt collectors would still be able to pursue parents to recover unpaid lunch bills; the act prohibits debt collectors who contract with schools from reporting the debt to credit reporting bureaus or selling the debt to a different agency.
Pending legislation in California, SB 265, seeks to amend the Child Hunger Prevention and Fair Treatment Act of 2017 so students with unpaid meal debt aren’t shamed, treated differently, or served a meal that differs from what their peers eat.
School districts withholding honors from students with lunch debt—from awards to the chance to take part in graduation ceremonies—made headlines earlier this month when press coverage of the Castile Foundation’s $8,000 donation to Robbinsdale Cooper High stated that seniors needed their lunch debt cleared to graduate. Robbinsdale Area Schools Superintendent Carlton Jenkins was quoted as saying, “For those students to know that they can graduate now without having a bill, I can’t tell you how big it is.”
But a spokeswoman for the school district told Civil Eats that students with lunch debt have never been prevented from graduating, and the press release about the Castile Relief Foundation donation on the district website now includes a note stating that it is a violation of Minnesota law to prevent a student from graduating, receiving a diploma, or attending class because of lunch debt.
The news stories about graduation and student lunch debt prompted legal aid attorney Jessica Webster to write a letter to the state education department commissioner stating how often she hears about school districts threatening to prevent students from graduating despite a 2014 state law that prevents schools from “demeaning” or “stigmatizing” youth because of an unpaid bill.
“For families, it’s not that clear,” Webster said of the law. “If you’re at risk of not graduating, it is very scary to families. Putting this kind of pressure on families is unconscionable to us.”
This year Congress will reauthorize the child nutrition programs, a process that includes modifications to the National School Lunch Program. Child nutrition hasn’t been reauthorized since 2010, when student lunch debt didn’t generate nearly as many news headlines and crowdfunding campaigns as it does today. During this time, Webster says schools have grown emboldened about the ways they lunch-shamed kids. She recalled students with low balances being told to get an alternative lunch from the back of the kitchen, essentially doing a “walk of shame” in front of their classmates. They would often go home crying to their parents about the lack of funds in their accounts, she said.
In 2017, however, the U.S. Department of Agriculture issued guidance about how schools can address lunch debt in a way that doesn’t shame students and keep parents out of the loop. The guidance did not prohibit schools from giving students cold snacks or hand stamps; it merely urged schools to find a way to reach out to parents behind on their children’s lunch bills.
While the guidance was not revolutionary, it did have an impact, according to Webster. “We were all happy to see that guidance,” she said. “A lot of states did look through that guidance, and we’ve seen fewer of these [lunch-shaming] practices since that advisory came out, but congressional action would be far more effective.”
During the child nutrition reauthorization process, Congress has the opportunity to change some of the regulations that have increased student lunch debt. It could alter how schools are reimbursed for student meals, which districts qualify for the community eligibility provision, and the criteria families must meet to receive a free lunch.
A hearing about the reauthorization took place in March, and Congress is expected to take action on child nutrition in the coming months.
Feeding Texas’ Celia Cole looks forward to the reauthorization process.
“The long-term fix to lunch shaming is making sure the meals are accessible and adequately funded,” she said. “The only fix is at the federal level.”
As John Mitchell, realizing that he was busted, once said to Carl Bernstein:
“Good god.”
From CNBC, via the Washington Post:
Nadler, who would preside over impeachment proceedings in the House, also expressed frustration with Attorney General William P. Barr during the interview with CNBC, at one point calling him “just a liar” and alleging that Barr mischaracterized the special counsel’s findings on coordination between Russia and Trump’s campaign during the 2016 election.
Nadler, whose committee is planning hearings with special counsel Robert S. Mueller III and key witnesses in his investigation, was asked by CNBC’s John Harwood about the timing of any potential impeachment proceedings that might follow. Some Democrats have argued that Trump obstructed Mueller’s probe and should be held accountable.
“It depends on what comes out,” Nadler said. “It depends where the American people are, whether they want to go that way or not. I don’t want to make it sound as if we’re heading for impeachment. Probably we’re not.” After Harwood noted that he’s heard from other House Democrats who think impeachment proceedings will be launched eventually, Nadler said: “Maybe. It’s hard. I don’t know.”
Will the Democrats ever learn a) how to message and b) that the press, no matter what conservatives say, is not their friend?
Photo Credit: Zack Gibson /Getty Images
Right now, the Republicans are moving implacably on all fronts to discredit any official account of both how the Russian ratfcking helped the president* win and also to discredit (and stop) any further investigation into how big a crook the Russians helped install in the White House. The chairman of the Senate Judiciary Committee is advising the president*’s son to ignore congressional subpoenas and, just yesterday, in federal court, the president*’s lawyers essentially argued that Congress has no right to investigate the president* over anything. And this is the kind of dithering we get from the guy who chairs the only committee that can bring impeachment charges against a criminal presidency*? To hell with knives and gunfights. This is bringing a pea-shooter to Omaha Beach.
I think Nadler is a decent chairman. I don’t think he has any illusion about the ferocity of the forces arrayed against him. But, dammit, he holds the majority on the House Judiciary Committee and there is power in that. Spectacularly, it gets worse.
Nadler said that in his view, Trump can be impeached for only two things: “misuse of presidential power while president or for cheating in the election that gave him the presidency.” “Other than that, if he did something terrible before he was president, he robbed the bank, that’s not impeachable,” Nadler said. “It’s a crime, but it’s not impeachable.” Nadler also said he considers Trump a “con man” but argued that that is not grounds for impeachment either. “He is thoroughly dishonest. He lies all the time. We know that. None of those are grounds for impeachment,” Nadler said. “They’re grounds for defeating him for reelection.”
So, technically, if the country had elected Whitey Bulger instead of George H.W. Bush in 1988, Whitey’s career as a serial-killing gangster would not have been grounds for impeachment unless he strangled someone in the East Room after having been inaugurated? Also, if the president* did cheat in the election in order to win it, and the House impeached him for it, it would be impeaching him because “he did something terrible before he was president.” Nadler’s argument doesn’t even make sense, and that’s in addition to the fact that he narrowed the grounds on which he might wield his considerable clout unnecessarily and voluntarily.
For the first time, I find myself siding with those people who believe that, ultimately, the House will chicken out of its constitutional duty and, because of that, I find myself siding with people who believe that the president*’s re-election chances are better than anyone thinks.
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May 15, 2019
Most Americans already know Medicare for All is the solution to our healthcare crisis.
Coal smoke and steam vapor pour out of the Bruce Mansfield Power Plant overlooking the Ohio River at dawn in Shippingport, Pennsylvania.Robert Nickelsberg / Getty Images file
In the latest bit of bad news for a planet beset by climate change, the concentration of carbon dioxide in Earth’s atmosphere has climbed to a level last seen more than 3 million years ago — before humans even appeared on the rocky ball we call home.
On Saturday, sensors at the Mauna Loa Observatory in Hawaii indicated that concentrations of the greenhouse gas — a byproduct of the burning of fossil fuels — had reached 415 parts per million (ppm), meaning that for every 1 million molecules of gas in the atmosphere, 415 were of carbon dioxide.
Carbon dioxide traps heat from the sun, and higher levels are associated with higher global temperatures and other effects of climate change, such as rising seas and unusual weather patterns.
The level of CO2 in the atmosphere has risen an average of 2.5 ppm per year over the past decade, reaching 400 ppm in 2013 — and the level appears likely to go higher from here.
“We’re racing toward a state very different from the kind humans evolved in and that civilization developed in,” said Ralph Keeling, a geochemist at the Scripps Institution of Oceanography in La Jolla, California.
The last time levels of atmospheric carbon dioxide were this high came during the Pliocene Epoch, which extended from about 5.3 million to 2.6 million years ago. During that period, average sea levels were about 50 feet higher than they are today and forests grew as far north as the Arctic, said Rob Jackson, a professor of earth system science at Stanford University. “Earth was a very different place,” he said. “You would hardly recognize the land surface, and my gosh, we don’t want to go there.”
But there is evidence to suggest the planet is headed in that direction. If the current trajectory continues, levels of CO2 could hit 500 ppm within 30 years, a number that could mean an increase in global temperatures of at least 2 degrees Celsius (about 3.6 degrees Fahrenheit).
“At the present pace, we could reach that well within a lot of people’s lifetimes,” Keeling said of the grim milestone ahead.
Levels of carbon dioxide in the atmosphere are commonly represented on a graph known as the Keeling Curve, named for Keeling’s father, Charles David Keeling, who began taking daily measurements of atmospheric carbon dioxide in 1958 from atop the Mauna Loa Observatory in Hawaii. The curve shows a steep climb, owing to human-caused climate change.
As the planet inches toward 500 ppm, scientists are sounding the alarm over the potential for catastrophic changes to our environment. “None of these specific numbers are really thresholds in the sense that anything particular happens when we cross them,” Gavin Schmidt, a climatologist who directs NASA’s Goddard Institute for Space Studies in New York City, told NBC News MACH in an email. “But as we go through them, we are putting our foot on the accelerator of climate change, and impacts and damage will continue to rise.”
But it’s hard to say exactly what these changes will bring, or when. Some things, like the loss of vegetation and sea-ice coverage, will grow increasingly visible in the short term. Other things, like the melting of ice sheets in Antarctica and Greenland, occur more slowly. “But these impacts are going to persist for a very long time,” said Dana Royer, a professor of earth and environmental sciences at Wesleyan University in Middletown, Connecticut. “Once that happens, we can’t really reverse it.”
Even if moving to renewable energy and other measures help stanch the steady flow of carbon dioxide into the atmosphere, our descendants will likely be saddled with the negative consequences of our artificially elevated levels of CO2.
“We’re not going to see the full consequences of 415 parts per million of carbon dioxide today,” Jackson said. “It’ll take a thousand years of people — 30 generations of people — to pay the price of what we’re doing today.”
George Conway, the husband of White House counselor Kellyanne Conway, lashed out at President Trump Sunday for his view of special counsel Robert Mueller’s investigation as “purely in terms of your own ego,” adding that the president “should pay with your office.”
“Think of it,” Conway, an outspoken critic of President Trump, started in a lengthy Twitter thread. “The Russia investigation was a legitimate investigation, with a legitimate basis, into how a hostile foreign power tried to interfere with and undermine our democracy. It was in the best interests of the nation — in the interests of all Americans, no matter who they voted for — that this investigation be allowed to proceed to its rightful conclusion, without improper attempts to obstruct it, if only so that we could all know what really happened and take steps to see that it never happens again.”
Conway blamed Trump’s take on the investigation into Russian interference in the 2016 presidential election on his being “a malignant narcissist — a person with both narcissistic and antisocial personality disorders,” a diagnosis he has repeatedly applied to his wife’s boss.
“Instead of complying with your oath of office, and instead of taking stock of what was in the best interests of the nation whose Constitution and laws you swore to uphold, you viewed the matter purely in terms of your own ego,” said Conway. “You viewed the investigation as casting doubt on what you perceive as your great election victory (in which your opponent garnered nearly three million more votes than you did), and so you took multiple steps to obstruct, and repeatedly lied about, the investigation from the outset.”
Conway was responding to Trump, who tweeted Sunday morning: “Think of it. I became President of the United States in one of the most hard fought and consequential elections in the history of our great nation. From long before I ever took office, I was under a sick & unlawful investigation concerning what has become known as the Russian Hoax.”
He added: “My campaign was being seriously spied upon by intel agencies and the Democrats. This never happened before in American history, and it all turned out to be a total scam, a Witch Hunt, that yielded No Collusion, No Obstruction. This must never be allowed to happen again!”
Although Mueller’s two-year probe found no conspiracy between Trump’s 2016 presidential campaign and Russia, the redacted report detailed “multiple acts by the President that were capable of exerting undue influence over law enforcement investigations, including the Russian-interference and obstruction investigations.” It also stated that “while this report does not conclude that the president committed a crime, it also does not exonerate him” on the obstruction of justice issue.
Still, despite laying out the evidence of possible obstruction like attempting to get Mueller fired, no conclusions were drawn on the matter, and Attorney General William Barr decided not to bring charges against the president, which Trump declared as “complete and total exoneration.”
“Even today, despite the well-founded assessments of the intelligence community, and despite the damning evidence laid out in the Mueller report, you refuse to take what the Russians did seriously,” said Conway. “Instead, you continue to lie, calling the investigation a ‘hoax’ and an ‘attempted coup,’ and you didn’t even mention Russia’s conduct in your recent 90-minute conversation with Putin, the man who seeks to undermine our institutions.”
Last week, before the Judiciary Committee voted to hold Barr in contempt of Congress, Trump asserted executive privilege over the unredacted Mueller report to keep it away from the House Judiciary Committee and instructed his former aides not to comply with a congressional subpoena to testify about the report’s findings.
Conway ended his condemnation by accusing Trump of putting his own interests before the nation’s, an offense for which, he said, the president should leave office, without specifying resignation or impeachment.
“Put simply, you put your own perceptions of your self-interest above the national interest, which you seem unable to comprehend or respect,” he wrote. “That is your greatest offense against the country, an offense that incorporates but vastly exceeds the statutory crimes you’ve committed. It is the ultimate high crime or misdemeanor under the Constitution, and under the Framers’ wise design, it is an offense for which you should pay with your office, regardless of whether you are ultimately brought to justice in the courts of law.”
The student loan system is $1.5 trillion mess that has attracted a ton of attention from policymakers to presidential candidates, with Sen. Elizabeth Warren (D-MA) proposing to cancel large amounts of outstanding debt.
That kind of debt relief would have clear benefits, according to a new report from the National Bureau of Economic Research (NBER).
Researchers looked at debt relief data from the credit bureau as well as from a lawsuit filing from 2017, related to National Collegiate — which held 800,000 private student loans totaling over $12 billion or about 11% of all outstanding student debt at the time — and concluded that there are “benefits of intervening in the student loan market to reduce the consequences of debt overhang problems by forgiving student debts.”
The report asserted that four things happened to borrowers in default who experienced debt relief: They saw their overall indebtedness reduced by 26%, were 12% less likely to default on other accounts, gained increased mobility when it came to job opportunities, and were more likely to increase consumption overall.
Since those examined in the report were already in default, they weren’t making student loan repayments. But even though their monthly expenses hadn’t changed, the experience of debt relief led them to manage other debt differently.
“The thing that was interesting about this study is that the people that got the forgiveness weren’t paying anyway, so it actually did not change their monthly loan payments at all,” Ben Miller, the senior director for post-secondary education at the Center for American Progress, told Yahoo Finance. So “it suggests there might be some sort of psychological benefit to this relief that goes beyond the household balance sheet.”
“That to me is really interesting,” Miller added, “because it suggests that there may be external benefits to debt relief that you don’t otherwise see.”
The first effect of student debt relief is that borrowers reduce their total liabilities by about $4,000 beyond the cancelled loan liabilities, according to the study. This means that with an average level of debt at $15,317, borrowers could see a 26% reduction.
“We find that consistently across all debt categories, and both with and without county-month fixed effects, the treated borrowers are significantly more likely to reduce the number of accounts,” the researchers wrote.
The study estimated that debt relief on average would reduce credit card debt specifically by $350, auto loans by $300, and mortgages by about $1,000.
“Overall, these findings suggest that treated individuals are significantly more likely to reduce their leverage after the debt is discharged,” said the report.
The second effect of debt relief is that borrowers saw the likelihood of default on all types of accounts reduced by 12%. Borrowers would also be less likely to miss payments on credit cards and mortgages, both massive and ballooning components of household debt that Deutsche Bank Economist Torsten Slok warned was a cause for concern in the U.S. economy.
“These findings speak to the potential spillover effects across liabilities and to a potential indirect benefit of intervening in this market by helping borrowers unable to afford their student loan debts,” the researchers noted.
The third effect was that borrowers who experience debt relief were more likely to consider moving for a job opportunity and thereby see their incomes rise.
“Consistent with a debt overhang problem affecting these borrowers, we find that the treated individuals are significantly more likely to move when their student loans get discharged,” said the researchers.
And once debt is discharged, borrowers also saw income rise by $4,000 over three years, estimated the researchers, which is roughly equivalent to two months’ salary, “likely due to the borrowers’ ability to accept better jobs.”
The final effect the researchers found was that with student loan debt relief, borrowers were more likely to increase consumption overall.
“We show that borrowers that were delinquent exclusively on their student debts are significantly more likely to increase their consumption after the court decision,” the report stated.
With 11.5% of outstanding student loans in serious delinquency, the average student borrower — who is putting off major milestones like starting a family and owning a home — would see considerable relief in their overall indebtedness and thus be more likely to spend.
That relief could prevent the potential drag on growth that Fed Chair Jerome Powell acknowledged in March when he said that as the student debt crisis “goes on and as student loans continue to grow and become larger and larger, then it absolutely could hold back growth.” (Powell added that student debt should be discharged in bankruptcy.)
“Our findings suggest that the costs of the rising student debt burden on the new generations can indeed have important effect: student debt limits the borrowers’ access to better opportunities and also has significant spillover effects to other debt classes,” the NBER researchers wrote.
Miller stressed that while “student loans aren’t as large as the housing market was and they’re not going to likely bankrupt the entire economy, they do matter for kind of generational wealth building for young people.”
“Since 11 percent of borrowers are 90 days or more delinquent on their student debts, rising student debt is considered one of the creeping threats of our time,” the researchers wrote.
And while debt cancellation was initially perceived as radical — particularly when Senator Warren pitched her $640 billion plan — the NBER study provides an argument for the clear benefits of that kind of approach.
“If student loan debt is holding back a generation from improving their financial situation, it seems safe to assume that discharging this debt would help graduates more fully participate in the economy,” Student Loan Hero Student Loan Debt Expert Rebecca Safier told Yahoo Finance.
Safier added that this kind of mass loan forgiveness “could improve borrowers’ financial lives on an individual level and, in turn, have a positive impact on the economy as a whole.”
Aarthi is a writer for Yahoo Finance.
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Despite the overall gig economy booming with companies like Lyft and Uber going public, the companies’ staunch resistance to meet drivers’ demands for full-time employment and benefits “has the potential” to worsen the retirement crisis, Chad Parks, Founder and CEO of Ubiquity Retirement + Savings told Yahoo Finance.
“To the best of our knowledge, ride-share companies have not formalized retirement savings options for their drivers,” Parks explained. And “in today’s world where most companies have abandoned pension plans and Social Security provides a very small portion of your retirement income, it puts the onus squarely on you to save for your future. It’s unfortunate, but this is the reality.”
There are nearly 16 million workers in the gig economy, according to a report by MBO Partners. Most are part-timers who freelance on the side to supplement their paychecks. For example, during the government shutdown, many federal workers actually took on drivers jobs to keep themselves adrift while their paychecks were suspended.
But for those who drive for Lyft or Uber full-time, the lack of proper health insurance or retirement savings plan — on top of dealing with an average hourly wage of $9.21 — is a big pain point.
“Unfortunately, like a lot of other Americans, drivers are not thinking about retirement as much as they should,” TheRideshareGuy.com Founder Harry Campbell told Yahoo Finance. “But this is also a function of the fact that nearly all of their pay is going to cover the day-to-day expenses.”
To be fair, Uber has been offering some sort of retirement savings option for drivers with a partnership with a robo-advisor called Betterment. But skepticism is rampant.
“I wouldn’t involve Lyft or Uber with my retirement planning,” one driver wrote on Uberpeople, an online forum for Uber drivers. “Odds are you’re not going to be working for them for very long, at least in the present form.”
Another wrote: “This is a sick joke right?”
Campbell sided with the drivers.
“The betterment partnership was a lot more fluff than substance in my opinion seeing as Uber didn’t contribute any money to the plan,” said Campbell. “A lot of drivers are struggling to get by as evidenced by the recent strikes and protests against Uber, so unfortunately saving for retirement is the last thing on their mind.”
And, unfortunately, the existing system also doesn’t do much for gig workers since they don’t have an established employer.
“The financial services industry is misaligned with the realities of the modern workplace, such as companies like Uber with a strong force of independent contract workers,” said Parks. “You can’t rely upon the government or your employer to take care of your retirement savings.”
Parks, the Ubiquity Retirement + Savings CEO, did offer three solutions for gig workers looking for a retirement savings vehicle: a traditional IRA plan, a Roth IRA plan, and an individual 401(K) plan.
The first one was good for those over 40, while Roth IRA was better for those under 40, he added. Both of those would be tax-deferred. And the individual 401(K) plan is “especially attractive for higher earners,” he added.
Aarthi is a writer for Yahoo Finance.