Deceptive advertising and marketing

Wall Street Accountability and Consumer Protection Act

hmoroz — Thu, 17 Dec 2009 11:24:17 -0500

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Percentage of delinquent loans originated by IndyMac, which failed in the summer of 2008, that required either very little or no documentation: 81.9

Estimated total support made available by the federal government to the financial system since 2007: $23.7 trillion

Year in which Goldman Sachs paid its highest bonuses ever: 2007

Year in which Goldman Sachs is expected to break this record: 2009

Total federal TARP funds used to bail out Goldman Sachs Group: $10 billion

Number of homes the Center for Responsible Lending estimates could be saved by court-supervised modifications of mortgages in bankruptcy: 800,000

Overview/Summary

Middle Class Position Analysis

Middle Class Supports. The economic and financial crisis has demonstrated that the current financial regulatory system permits banks, mortgage brokers and servicers, and other firms to enrich themselves at the expense of ordinary Americans. Abusive and fraudulent mortgages sold to unsuspecting homeowners fueled the housing crisis while credit card companies used deceptive billing practices to mire cardholders in debt. The federal government leaped into action to assist the financial services industry when firms like AIG, Morgan Stanley, and Citigroup were at risk. The $700 billion TARP program and trillions of dollars more in cheap loans and guarantees have nurtured the financial services sector back to health, profits, and gigantic compensation packages. Meanwhile, middle-class Americans continue to face foreclosure and abusive lending and credit card practices in addition to extended bouts of unemployment.

The Wall Street Reform and Consumer Protection Act’s creation of a Consumer Financial Protection Agency is a critical innovation to protect ordinary Americans from deceptive and abusive lending practices. While consumers are currently guarded from faulty products like toasters, no single agency is tasked with overseeing the financial products and services – from credit cards to mortgages and student loans – that Americans rely on every day to earn a middle-class standard of living. The CFPA will be empowered to root out products and services that are harmful to aspiring middle-class and middle-class Americans. It will promote equal access to safe credit products and root out harmful ones like certain subprime mortgages, abusive credit card practices, and usurious payday loans. The Agency is critical to making the financial services sector work for ordinary Americans. The Mortgage Reform and Anti-Predatory Lending Act, which is included in the bill, also takes important steps to combat and end the abusive lending practices at the root of the financial crisis.

The legislation’s increased regulation of executive compensation, improved protections for investors, and expanded oversight of derivatives all address factors – compensation structures that encouraged excessive risk taking, fraudulent investment practices like Bernard Madoff’s Ponzi scheme, and opaque derivatives contracts – that contributed to the financial crisis. These steps will help ensure that similar practices do not precipitate another crisis.

The Financial Services Oversight Council, the regulatory powers granted to the Council, and the dissolution authority included in the legislation make the development of a financial threat into an agent of financial and economic destabilization less likely. By regularizing a process for oversight of financial markets and creating a mechanism for regulators to impose capital, leverage, and other standards on at-risk firms, the legislation significantly enhances the federal government’s capacity to stem an outbreak of instability before it begins. Most importantly for middle-class Americans, this process and the dissolution authority created by the legislation rely on assessments of the largest financial firms for funding. Thus, if future bailouts become necessary, they are much less likely to use taxpayer dollars.

Quotes from Experts

Beyond this Bill

Additional Resources

Americans for Financial Reform

“Financial Regulatory Reform,” from the House Financial Services Committee

“Consumer Financial Protection Agency,” from the Consumer Federation of America

Wall Street Accountability and Consumer Protection Act

hmoroz — Thu, 17 Dec 2009 11:24:17 -0500

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Percentage of delinquent loans originated by IndyMac, which failed in the summer of 2008, that required either very little or no documentation: 81.9

Estimated total support made available by the federal government to the financial system since 2007: $23.7 trillion

Year in which Goldman Sachs paid its highest bonuses ever: 2007

Year in which Goldman Sachs is expected to break this record: 2009

Total federal TARP funds used to bail out Goldman Sachs Group: $10 billion

Number of homes the Center for Responsible Lending estimates could be saved by court-supervised modifications of mortgages in bankruptcy: 800,000

Overview/Summary

Middle Class Position Analysis

Quotes from Experts

Beyond this Bill

Additional Resources

Americans for Financial Reform

“Financial Regulatory Reform,” from the House Financial Services Committee

“Consumer Financial Protection Agency,” from the Consumer Federation of America

Consumer Financial Protection Agency Act of 2009

hmoroz — Tue, 04 Aug 2009 12:05:27 -0400

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Quotes from Experts

Beyond this Bill

Additional Resources

Consumer Financial Protection Agency Act of 2009

hmoroz — Tue, 04 Aug 2009 12:05:27 -0400

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Quotes from Experts

Beyond this Bill

Additional Resources

Higher Education Opportunity Act of 2008

hmoroz — Wed, 06 Aug 2008 15:56:11 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Percentage of dependent Pell Grant recipients whose family income is less than $20,000: 40

Percentage of tuition and fees (including room and board) at public four-year colleges that was covered by the maximum Pell Grant in the 1986-1987 school year: 52

Percentage of tuition and fees (including room and board) at public four-year colleges that was covered by the maximum Pell Grant in the 2006-2007 school year: 32

Amount that the average college student pays for textbooks each year: $900

Average number of hours that the Brookings Institution estimates an applicant needs to complete the FAFSA: 10

Number of hours a year spent filling out financial aid forms: 100 million

Equivalent in full-time jobs: 55,000

Number of students who have not received financial aid due to drug convictions since the provision went into effect in 2000: 200,000

Overview/Summary

Middle Class Position Analysis

Middle Class Supports. Although a college education is increasingly a prerequisite for a middle-class standard of living, current and aspiring middle-class students and their families are struggling more than ever to afford college. Indeed, in recent years the maximum Pell Grant, designed to provide financially strapped students with an opportunity to attend college, has failed to keep pace with rising higher education costs. 2007’s College Cost Reduction and Access Act, which increased the maximum Pell Grant and limited federal subsidies to student lenders in order to increase college financial aid by $20 billion, was a necessary first step in making college more affordable. The Higher Education Opportunity Act’s additional increase of the maximum Pell grant will make college accessible to more aspiring middle-class Americans. Additionally, the expansion of the Pell Grant program to include year-round education supports the hardest-working students struggling to complete their educations quickly. Continued commitment to the TRIO and GEAR UP programs is critical to ensuring that first generation and at-risk students are able to obtain a college education and achieve a middle-class standard of living.

Skyrocketing tuition costs and large and confusing debt obligations can make college unaffordable and financial stability after college difficult. Indeed, the College Board reports that average tuition and fees at four-year public institutions have increased 51% over the last five years and that private undergraduate loans have grown from 3% to 12% of the funds used to finance postsecondary education since the 1996-1997 school year . The Higher Education Opportunity Act improves a student loan system that has been characterized by favoritism and murky lending practices. The Act will help put an end to the most egregious conflicts of interest and will expand and simplify the information that is available to students and their families when deciding what colleges to attend and what loans to take out. Ending such conflicts of interest will ensure that students receive the most affordable loans, not loans that are the favorites of an unethical financial aid officer. A simplified application form for federal student aid will ensure that students are not dissuaded from seeking financial assistance for higher education because of complex paperwork. Stricter reporting requirements for institutions that that fail to rein in tuition hikes are a positive step in influencing institutions of higher education to make college more affordable. Efforts to reduce the cost of textbooks will also be helpful to students struggling with high costs.

Quotes from Experts

Beyond this Bill

Additional Resources

Higher Education Project, from U.S. Public Interest Research Group

Window of Opportunity: Targeting Federal Grant Aid to Students with the Lowest Incomes, from the Institute for Higher Education Policy

Trends in College Pricing 2007, from the College Board

Higher Education Opportunity Act of 2008

hmoroz — Wed, 06 Aug 2008 15:56:11 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Percentage of dependent Pell Grant recipients whose family income is less than $20,000: 40

Percentage of tuition and fees (including room and board) at public four-year colleges that was covered by the maximum Pell Grant in the 1986-1987 school year: 52

Percentage of tuition and fees (including room and board) at public four-year colleges that was covered by the maximum Pell Grant in the 2006-2007 school year: 32

Amount that the average college student pays for textbooks each year: $900

Average number of hours that the Brookings Institution estimates an applicant needs to complete the FAFSA: 10

Number of hours a year spent filling out financial aid forms: 100 million

Equivalent in full-time jobs: 55,000

Number of students who have not received financial aid due to drug convictions since the provision went into effect in 2000: 200,000

Overview/Summary

Middle Class Position Analysis

Quotes from Experts

Beyond this Bill

Additional Resources

Higher Education Project, from U.S. Public Interest Research Group

Window of Opportunity: Targeting Federal Grant Aid to Students with the Lowest Incomes, from the Institute for Higher Education Policy

Trends in College Pricing 2007, from the College Board

FDA Amendments Act of 2007

atraub — Wed, 12 Dec 2007 15:29:15 -0500

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Number of letters sent by the FDA to pharmaceutical manufacturers warning them that they had violated regulations for prescription-drug advertising in 1997: 142

Number of letters sent in 2006: 21

Percentage of the warning letters regarding direct-to-consumer advertisements between 1997 and 2006 that admonished drug companies for minimizing drug risk or exaggerating drug effectiveness: 84

Pounds of imported foods the average American eats in a year: 260

Percentage of food imports currently inspected by the FDA: 1

Estimated number of Americans who become sick each year due to food-borne illness: 76 million

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports. Middle-class Americans depend on over-the-counter and prescription drugs for everything from relieving aches and pains to sustaining life. Because these medications are so important, and because every drug has risks associated with it, the power this legislation provides the FDA to more closely regulate the pharmaceutical industry is vital. Middle-class Americans, inundated with advertisements extolling the benefits of innumerable and at times indistinguishable medications, need the FDA to ensure that the drugs they rely upon are safe and appropriate for the individuals to whom they are marketed.

For more than five years, 20 million Americans took the arthritis pain medication Vioxx before studies demonstrating an increased risk of heart attacks associated with the drug forced Merck to withdraw it. The new authority that this legislation grants the FDA to demand post-approval studies of medications is a regulatory tool that could have exposed the risks associated with Vioxx much sooner, saving many Americans from heart attack and death. Fines to punish false advertisements will do much to ensure that Americans are not misled about the purposes, risks, and benefits of the medications they are taking. Finally, the concealment and obfuscation of safety information that puts consumers at risk of taking dangerous drugs – a charge that Merck has faced in the products liability litigation involving Vioxx – will be made difficult by the FDAAA’s expansion of public access to safety data. A public database of clinical trial data with mandatory disclosure requirements will allow consumer advocacy groups, concerned academics, and products liability litigators, along with jealous industry competitors, to expose misinformation, ultimately protecting middle-class consumers.

Quotes from Experts

Beyond this Bill

Additional Resources

“Drug Safety: FDA Needs to Further Address Shortcomings in Its Postmarket Decision-making Process,” from the GAO

“Prescription Drugs: Improvements Needed in FDA’s Oversight of Direct-to-Consumer Advertising,” from the GAO

“The Future of Drug Safety: Action Steps for Congress,” from the Institute of Medicine

FDA Amendments Act of 2007

atraub — Wed, 12 Dec 2007 15:29:15 -0500

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Number of letters sent by the FDA to pharmaceutical manufacturers warning them that they had violated regulations for prescription-drug advertising in 1997: 142

Number of letters sent in 2006: 21

Percentage of the warning letters regarding direct-to-consumer advertisements between 1997 and 2006 that admonished drug companies for minimizing drug risk or exaggerating drug effectiveness: 84

Pounds of imported foods the average American eats in a year: 260

Percentage of food imports currently inspected by the FDA: 1

Estimated number of Americans who become sick each year due to food-borne illness: 76 million

Overview/Summary

Middle Class Position Analysis

Quotes from Experts

Beyond this Bill

Additional Resources

“Drug Safety: FDA Needs to Further Address Shortcomings in Its Postmarket Decision-making Process,” from the GAO

“Prescription Drugs: Improvements Needed in FDA’s Oversight of Direct-to-Consumer Advertising,” from the GAO

“The Future of Drug Safety: Action Steps for Congress,” from the Institute of Medicine

Deceptive advertising and marketing

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The middle class

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Injustice Facts

Overview/Summary

Middle Class Position Analysis

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The middle class

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Overview/Summary

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The middle class

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Beyond this Bill

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Additional Resources

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