Sen. Chuck Schumer August Porker of the Month

Posted on August 31, 2016August 31, 2016 by Denise Simon

Today, Citizens Against Government Waste (CAGW) named Senator Chuck Schumer (D-N.Y.) its August Porker of the Month for his leading role in the effort to create supposedly “debt free” college for all students, which would exacerbate rather than resolve the student loan crisis.

As coeds across the nation return to school, the debate over their increasing loan debt has intensified. According to the Federal Reserve Bank of New York, student loan debt hit an all-time high of $1.26 trillion in Q2 2016, which is a $69 billion increase from the previous year. Upon graduating with a bachelor’s degree, the average student owes more than $37,000, more than double the amount they owed in the early 1990s. More than 43 million Americans are liable for these loans.

The cause of this dramatic increase in student loan debt is simple: Increased federal government subsidies. Over the past decade, there has been a 69 percent increase in students borrowing from federal loan programs. The federal government now provides about 71 percent of all student aid. The consequential increase in student access to credit enables colleges and universities to continue to hike prices, which necessitates more loan borrowing. Tuition costs have increased 153 percent over the last three decades for private colleges and 231 percent for public universities, faster than prices for both food and healthcare.

Senator Schumer completely fails to comprehend the root cause of the student loan bubble. He proposed S. 2677, the In the Red Act, earlier this year that would ensure “debt free college for every student in the country.” Putting aside the steep price tag on his supposedly “free” plan, Senator Schumer offered a puzzling assessment of the student loan bubble on February 12, 2016: “A Ford and a college education used to be the same price, but these days an education at NYU costs $60,000 a year, compared to $20,000 for a Ford today.”

Senator Schumer’s silly comparison between the open and highly competitive auto market and the closed and heavily subsidized higher education sector lays bare his flawed knowledge of how government intervention hurts students. His plan would continue the vicious cycle of increased subsidies and higher loans that have already saddled America’s next generation with mountainous debt.

For his utter lack of understanding of the student loan bubble and his efforts to inflate it, CAGW names Sen. Chuck Schumer its August Porker of the Month.

Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government. Porker of the Month is a dubious honor given to lawmakers, government officials, and political candidates who have shown a blatant disregard for the interests of taxpayers.

Meanwhile, how about that debt?

CBO Increases Projected Deficit Estimate

On August 5, 2016, the Congressional Budget Office (CBO) released its “Monthly Budget Review for July 2016.” The CBO increased its projection of fiscal year 2016 deficit by 10 percent, from $534 billion to $590 billion, in its review. The non-partisan agency attributes the deficit increase to lower-than-expected revenues. In addition to lower revenues, costs have also risen.

In the review, CBO found that spending rose for Social Security benefits, net interest on the public debt, Medicare, Medicaid, and the Department of Veterans Affairs. The CBO found that spending on Social Security benefits rose by $24 billion (three percent), but pointed out that this reflects “typical growth in the number of beneficiaries and in the average payment.” Net interest on the public debt increased by $23 billion (11 percent) due to inflation differences. Medicare and Medicaid spending both climbed four percent ($18 billion and $11 billion, respectively) due to changes to prescription drug plans in Medicare and new enrollees in Medicaid through the Affordable Care Act. Similar to Medicaid, spending increased to the Department of Veterans Affairs due to the increase of veterans receiving disability payments. Spending by the Department of Veterans Affairs increased by five percent, or $7 billion.

The CBO asserts that the deficit increase is due to lower than expected revenues, i.e., taxes. Rather than finding more revenues, Congress should reduce spending, considering that any additional revenues come out of the pockets of the hard-working taxpayers that actually fund the federal government.

Hat tip to: Citizens Against Government Waste. Tired of the Government wasting your Tax Dollars? Take Action Here! (800) BE-ANGRY

The Criminal Russia Party Report

Posted on August 31, 2016August 31, 2016 by Denise Simon

The ‘Criminal Russia’ Party Meduza summarizes Ilya Yashin’s new report on corruption in Russia’s ruling political party

Meduza: Ilya Yashin, a prominent member of the anti-Kremlin opposition, has released a new report, titled “The ‘Criminal Russia’ Party,” examining corruption in Russia’s leading political party, United Russia. Yashin focuses on party members who have already been prosecuted for various crimes and members he suspects are involved in illegal activities. Meduza summarizes his findings.

The 60-page report covers four general categories of officials: governors, federal ministers, members of the State Duma, and mayors. Yashin’s report relies on open sources, without any new investigative work.

Governors

The report begins with the story of Vyacheslav Gayzer, the governor of the Republic of Komi, who successfully led the region starting in 2010, until five years later when it suddenly turned out that he was the head of an organized crime group. In autumn 2015, nearly two dozen people were arrested along with Gayzer, including several senior officials.

Next comes Alexander Khoroshavin, who presided over the region of Sakhalin for eight years until spring 2015, when he was arrested for bribery.

In autumn 2015, Nikolai Denin, who had served as the governor of Bryansk for nearly ten years, was sentenced to four years in prison.

All of these governors were members of United Russia.

The report also mentions the head of the Pskov region, Andrey Turchak, and his alleged involvement in the attack on journalist Oleg Kashin in 2010. After an argument online, Kashin was severely beaten by the guards of a factory supervised by the Turchak family. There are, however, no formal charges against Governor Turchak.

Citing media reports, Yashkin accused former Moscow Mayor Yuri Luzhkov of giving lucrative contracts to the company of his wife, Yelena Baturina. (Law enforcement agencies have not filed complaints against the couple.)

Ministers

The report mentions two ministers: former Minister of Agriculture Elena Skrynnik and former Defense Minister Anatoly Serdyukov.

Yashin accuses Skrynnik of signing fraudulent leasing agreements in which she earned $35,000, which she allegedly spent on a purse. He also claims she spent another 50,000 euros on a wristwatch. Today, Skrynnik lives abroad, though she did travel to Russia for questioning on charges of embezzlement at the Ministry of Agriculture.

Yashin says Serdyukov was involved in a corruption scandal at the Ministry of Defense. In 2012, it became clear that the agency sold property at reduced prices, and Serdyukov was dismissed and prosecuted only for negligence, and later pardoned. The main defendant in the criminal case was the head of the Department of Property Relations of Russia’s Defense Ministry, Evgenia Vasilyeva, with whom Serdyukov had a close relationship.

State Duma members

Yashin suspects Duma member Vladislav Reznik of being involved in money laundering operations with the Russian mafia in Spain. Spanish police also believe that Reznik lobbied the interests of Gennady Petrov, who is part of a criminal organization founded by former wrestler Aleksandr Malyshevsky.

Duma member Adam Delimkhanov is a close associate of Chechen ruler Ramzan Kadyrov. The report says Delimkhanov is believed to be the “executioner” behind the killings of Boris Nemtsov, Movladi Baisarov, and the Yamadayev brothers.

Russian authorities have made no official accusations against either Reznik or Delimkhanov, both of whom are members of United Russia.

Local officials

The report argues that Sergei Tsapok—the leader of Kuban-based Kushchevsky criminal organization—was also a member of United Russia and even attended the presidential inauguration of Dmitry Medvedev in 2008. United Russia, however, refutes these claims. Tsapok died in prison several months after starting a life sentence.

Makhachkala Mayor Said Amirov was undisputedly a member of United Russia. He ruled the city starting in 1998 and was arrested in 2013 for—among other things—preparing a terrorist attack and ordering the murder of an investigator. Amirov is now serving a life sentence.

Yashin also mentions Yuri Lastochkin from Rybinsk, who is rumored to have become the focus of a criminal investigation after a dispute with Vladimir Putin, and the mayor of Vladivostok Igor Pushkarev, who was arrested June 1, 2016, on charges of abusing his authority and accepting bribes. Lastochkin and Pushkarev were also members of United Russia.

***

“The ‘Criminal Russia’ Party” is not Yashin’s first such report. He issued a similar paper about Chechen dictator Ramzan Kadyrov, and helped finished a report started by slain opposition leader Boris Nemtsov titled “Putin: War” about Russian combatants fighting in eastern Ukraine.

The Crisis of Cuba and Venezuela, Immigration Chaos

Posted on August 30, 2016August 30, 2016 by Denise Simon

9 Latin nations band together to plead with U.S. over Cuba

Cuban migrants were photographed in November outside the border control building in Penas Blancas, Costa Rica, after Nicaragua closed its borders to Cuban migrants. Nine Latin American governments on Monday charged that U.S. policy toward Cuban migrants has created a humanitarian crisis for the region. Esteban Felix AP

McClatchy/WASHINGTON:Eight Latin American governments on Monday joined Costa Rica in calling on the United States to end its special treatment for Cuban migrants.

The Ecuadorean foreign minister delivered a letter to Secretary of State John Kerry signed by the foreign ministers of the eight countries and Costa Rica in expressing their “deep concern” that U.S. policy toward Cuban migrants is creating a humanitarian crisis and encouraging “a disorderly, irregular and unsafe flow of Cubans.”

“Cuban citizens risk their lives, on a daily basis, seeking to reach the United States,” the letter says, according to excerpts forwarded by Ecuador’s embassy in the United States. “These people, often facing situations of extreme vulnerability, fall victim to mafias dedicated to people trafficking, sexual exploitation and collective assaults. This situation has generated a migratory crisis that is affecting our countries.”

The letter was signed by the foreign ministers of Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Mexico, Nicaragua, Panama and Peru.

State Department officials did not immediately respond to a request for comment.

This situation has generated a migratory crisis that is affecting our countries. Nine Latin American governments

The countries have been caught up in the drama of record-breaking Cuban migration. More than 46,500 Cubans were admitted to the United States without visas during the first 10 months of the 2016 fiscal year, according to the Pew Research Center. That figure compares with more than 43,000 in 2015 and just over 24,000 in 2014.

Several of the countries found themselves caring for thousands of stranded Cubans who were stuck at their borders or in the interior after running out of money to continue the journey.

Costa Rican Foreign Minister Manuel González told McClatchy in an interview last week that the issue has cost his country millions of dollars it doesn’t have and has raised complaints from Costa Ricans about spending resources on stranded foreigners when they were needed by the nation’s own citizens.

“The difficulties between the U.S. and Cuba has a direct consequence on other countries in our region that serve as transit,” González said. “And we are, in a way, paying the consequences of that bilateral relationship.”

The difficulties between the U.S. and Cuba has a direct consequence on other countries in our region that serve as transit.

The nine signatories say the “main cause of the current situation” is the Cuban Adjustment Act, which allows Cubans who reach American soil to remain in the United States, even if they arrived without legal documentation. The signatories say revising the act would be the first step toward addressing the worsening crisis.

They have called for Kerry to attend a “high-level meeting” to review the issue.

“It is time for the United States to change its outdated policy for Cuban migrants, which is undermining regular and safe migration in our continent,” said Ecuadorean Foreign Minister Guillaume Long.

John Kirby, the State Department spokesman, confirmed Tuesday that Kerry had received the letter and said the U.S. was continuing talks with the nine governments. He called on the countries to respect the human rights of migrants and asylum-seekers.

“Irregular migration often involves dangerous journeys that illustrate the inherent risks and uncertainties of involvement with organized crime, including human smugglers and traffickers, in attempts to reach the United States,” Kirby said.

The Obama administration has also been encouraging the countries to enforce their own immigration requirements and send undocumented Cubans back to Cuba. But Cuban activists worry that that policy will only encourage Cubans to instead flee the island on dangerous ocean voyages to reach Florida.

The number of Cubans making the sea trip has nearly doubled in the past two years, Coast Guard statistics show.

Related reading: Creating the exile pool

Normalization has so far not included an end to the Cuban Adjustment Act, which encourages Cubans to become undocumented aliens. Mexicans are told to stay home or “get in line” for a green card, but Cubans who reach US shores can be fast-tracked to citizenship. More here.

Meanwhile, there is Venezuela.

WashingtonPost: VENEZUELA’S MAN-MADE humanitarian crisis is deepening. The Associated Press reports that the typical resident of Caracas, the capital, spends 35 hours a month waiting in line to buy food, and 9 in 10 say they can’t find enough . After the government of Nicolás Maduro opened six border crossings to neighboring Colombia on Aug. 13, about 380,000 Venezuelans poured across in the first eight days, desperately seeking supplies. Sackings of food warehouses by hungry mobs have been reported; 50 animals in the Caracas zoo are said to have starved to death. Meanwhile, Mr. Maduro refuses to allow aid shipments into the country, contending they are unneeded.

The United States and most of Venezuela’s neighbors have responded to this collapse of a once-prosperous oil-producing country by doing their best to ignore it. They issue feckless statements calling for “dialogue,” overlooking the by-now obvious reality that the regime has no intention of seriously negotiating with the opposition. This week, it will become harder for the United States and others to remain apathetic. Opposition parties are seeking to organize a mass demonstration in Caracas on Thursday; last Saturday, the regime responded by transferring a top leader from house arrest to prison. The government appears intent on crushing the protest movement, rather than responding to its legitimate demands.

First among these demands is the staging of a referendum by the end of this year to recall Mr. Maduro from office. Venezuela’s constitution provides for such a process, and though its requirements are onerous, the opposition has shown it can meet them. Early this month, the government-controlled electoral authority acknowledged that the recall campaign had met an initial requirement for gathering petition signatures across the country. But it then released a timetable indicating that a referendum would not be held by the end of this year, the effective deadline for a meaningful vote. If Mr. Maduro were recalled after Jan. 10, he would be replaced by his vice president, rather than an opposition nominee.

Mr. Maduro, who polls show would win as little as 15 percent of the vote in a recall ballot, has been gloating over this obstructionism. He ordered the firing of hundreds of government employees who signed recall petitions. When a U.S. federal indictment was unsealed against a general for drug trafficking, Mr. Maduro appointed him interior minister, in charge of domestic security forces.

Prodded by the secretary general of the Organization of American States, the Obama administration and 14 other governments issued a statement on Aug. 11 calling for the referendum to be held “without delays.” On Sunday, the State Department toughened its rhetoric, condemning the imprisonment of opposition leader Daniel Ceballos as “an effort to intimidate and impede the Venezuelan people’s right to peacefully express their opinion September 1.” The administration should be prepared to act if the regime responds violently to the protest. It should quickly punish officials involved in repression and press the OAS to move against Venezuela under its democracy charter.

At the same time, the United States should begin coordinating with Colombia, Brazil and other nations about ways to respond to the humanitarian crisis. As Mr. Maduro cracks down, Venezuelans are likely to get hungrier.

DoJ: Enforcing the Law is Discrimination

Posted on August 29, 2016August 29, 2016 by Denise Simon

Justice Dept.: Firing migrant workers with expired papers is discrimination

WashingtonExaminer: The Justice Department released a video this week encouraging companies not to terminate immigrants after their employment authorization expires, and indicated that doing so is a form of discrimination.

The video is shot in a dimly lit office, where two actors discuss whether their fictional company should let go of some Salvadoran employees who have failed to provide updated paperwork on their immigration status.

After a discussion about whether retaining the workers would violate the law, a woman says, “I think this is an exception to that rule,” and recommends that they contact the the Office of Special Counsel for Immigration Related Unfair Employment Practices before making any decisions.

“We want to follow the rules but we don’t want to lose these workers or discriminate against them,” she concludes. “They are too valuable.”

The video then tells viewers that the federal government has extended employment authorization by six months for people from El Salvador with Temporary Protected Status, a benefit designed to help foreign nationals who are considered unable to safely return to their home.

The Justice Department claims requesting additional work-authorization documents from these workers may violate a provision in the Immigration and Nationality Act (INA) designed to protect individuals from excessive employer demands based on their nationality.

“The Justice Department is firmly committed to protecting the rights of all work-authorized immigrants and ensuring that employers do not engage in unlawful discrimination,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division in a statement upon the video’s release on Thursday.

Related reading: Read the report on Obama Executive Action Removals Executive Action-Removals-SCOMM

MigrationPolicy: While much of the attention to the Obama administration’s announcement of executive actions on immigration in November 2014 has focused on key deferred action programs, two changes that have not faced legal challenge are in the process of being implemented and may substantially affect the U.S. immigration enforcement system. These changes include the adoption by the Department of Homeland Security (DHS) of new policy guidance on which categories of unauthorized immigrants and other potentially removable noncitizens are priorities for enforcement, and the replacement of the controversial Secure Communities information-sharing program with a new, more tailored Priority Enforcement Program (PEP).

The new policy guidance, which builds on previous memoranda published by the Obama administration in 2010 and 2011, further targets enforcement to noncitizens who have been convicted of serious crimes, are threats to public safety, are recent illegal entrants, or have violated recent deportation orders. MPI estimates that about 13 percent of unauthorized immigrants in the United States would be considered enforcement priorities under these policies, compared to 27 percent under the 2010-11 enforcement guidelines. The net effect of this new guidance will likely be a reduction in deportations from within the interior of the United States as DHS detention and deportation resources are increasingly allocated to more explicitly defined priorities.

By comparing the new enforcement priorities to earlier DHS removal data, this report estimates that the 2014 policy guidance, if strictly adhered to, is likely to reduce deportations from within the United States by about 25,000 cases annually—bringing interior removals below the 100,000 mark. Removals at the U.S.-Mexico border remain a top priority under the 2014 guidelines, so falling interior removals may be offset to some extent by increases at the border.

Taking the enforcement focus off settled unauthorized immigrants who do not meet the November 2014 enforcement priorities would effectively offer a degree of protection to the vast majority—87 percent—of unauthorized immigrants now residing in the United States, thus affecting a substantially larger share of this population than the announced deferred action programs (9.6 million compared to as many as 5.2 million unauthorized immigrants).

This report analyzes how many unauthorized immigrants fall within each of the new priority categories and how implementation of these priorities could affect the number of deportations from the United States, as well as what the termination of Secure Communities and launch of PEP could mean for federal cooperation with state and local authorities on immigration.

Social Security Insolvency Estimates

Posted on August 29, 2016August 29, 2016 by Denise Simon

Social Security’s looming $32 trillion shortfall

CNBC: You can look at the financial health of Social Security in many ways.

The official version, found in the Social Security and Medicare Boards of Trustees’ annual report, is this:

Social Security’s total income is projected to exceed its total cost through 2019, as it has since 1982. After 2019, interest income and money taken out of reserves will provide the resources needed to offset Social Security’s annual deficits until 2034.

By then, if Congress does nothing, the federal government will collect enough in payroll taxes to pay about 75 percent of scheduled retirement benefits until 2090.

The Social Security Administration projects that unfunded obligations will reach $11.4 trillion by 2090. That’s up $700 billion from the $10.7 trillion the administration projected for its 2089 shortfall.

Infinite horizon

Despite the huge numbers, there’s even a less generous way of looking at the fiscal shortfall.

A projection, known as the “infinite horizon,” takes into account all the program’s future liabilities, even those beyond the 75-year period that Social Security actuaries typically use in their calculations.

Under the infinite horizon, Social Security will have $32.1 trillion in unfunded liabilities by 2090, $6.3 trillion more than last year’s projection. (See the chart below.)

The full chart is here. The infinite horizon calculation is the most important part of the trustees’ annual report, said Laurence Kotlikoff, a Boston University economics professor and co-author of “Get What’s Yours,” a best-seller about how to maximize claiming Social Security retirement benefits.

“We’re not broke in 20 years to 30 years, we’re broke now,” Kotlikoff said. “All the bills have been kept off the books by Congress and presidential administrations for six decades.”

The $6.3 trillion increase in the infinite horizon projection shows that Social Security Administration actuaries are more pessimistic about economic and wage growth, Kotlikoff said.

A reduction in the interest rate used to make calculations under the infinite horizon projection from 2.9 percent to 2.7 percent was the main contributor to the rise in the unfunded obligations forecast from last year, according to the trustees’ report.

“You can’t hide the numbers under a bunch of malarkey,” said Kotlikoff, who is running for president as a write-in candidate.

Kotlikoff had an influential ally in his quest for better accounting for Social Security and other federal programs. In 2013, Sen. Tim Kaine, the Democratic Party’s vice presidential nominee, co-sponsored bipartisan legislation that would require the federal government to use infinite horizon calculations and so-called fiscal gap accounting, which considers the difference between the government’s projected financial obligations and the present value of all projected future tax and other revenue. The bill, which Kotlikoff championed, did not pass.

Presidential proposals

Presidential candidates from the two major political parties have yet to present detailed plans for how they will address Social Security’s shortfall.

Hillary Clinton said she won’t cut Social Security benefits and will expand the program, especially for widows and people who have left the workforce to take care of children, spouses or relatives.

She plans to ask “the highest-income Americans to pay more, including options to tax some of their income above the current Social Security cap and taxing some of their income not currently taken into account by the Social Security system,” according to her campaign website.

Currently, earnings up to $118,500 are taxed for Social Security benefits. Eliminating the cap this year would mean the trust fund reserves would be depleted in 2055 instead of 2034, according to estimates from Karen Smith, a senior fellow in the Income and Benefits Policy Center at the Urban Institute.

Clinton opposes “any attempts to gamble seniors’ retirement security on the stock market through privatization.” However, investing a portion of Social Security’s trust fund assets in stocks would likely reduce the need for higher payroll taxes without disrupting the capital markets, according to a recent analysis by the Center for Retirement Research at Boston College.

Donald Trump has said he wants to preserve Social Security, saying the key to do so is to have “an economy that is robust and growing.”

Stronger economic growth may delay Social Security’s insolvency, but it would not fix its underlying fiscal problems, according to Smith’s research.

So what would have a big impact on Social Security’s fiscal standing if you don’t cut benefits? Raising payroll taxes. Smith found that increasing payroll taxes by 3 percentage points from 12.4 percent — half paid by employers and half paid by employees — to 15.4 percent would make Social Security reserves last at least 53 years longer, or until 2087.

Few politicians are proposing that fix for future generations.