Author Archives: nottoobigtofail.org

“Thanks to overbearing post-crisis government mortgage regulation, not only can’t many get the mortgage they want and deserve (costing 2 million jobs per JPMorgan’s Jamie Dimon), but as I pointed out recently, it costs roughly double ($4,000 pre-crisis vs. $8,000 today) for a lender to make a home loan. And now, on top of that, because of reduced competition caused by the crisis and government regulation (which acts as a barrier to entry), mortgage lenders today make almost 2.75 (60.5 bps divided by 16.2 bps) times the profit margin they did pre-crisis…

…This is Elizabeth Warren’s record…great for the surviving lenders and not so great for the American home borrower and prospective homebuyer.”, Mike Perry, former Chairman and CEO, IndyMac Bank

Excerpt from mortgage industry newsletter:

June 4, 2017

To Our Clients, Colleagues, and Friends:

• In the five years ending in 2016, the average profit per loan for mortgage bankers was 60.5 bps. Now go back to the five years ending in 2008, before the financial crisis led to the Fed lowering rates, and the average profit per loan was 16.2 bps. Would you be willing to go five years earning just 16.5 bps per loan?

“The political and media hysteria surrounding the Trump administration lies somewhere on the repulsiveness scale between the Jacobin excesses of the French Revolution and the McCarthy era. Thus far the public knows of no presidential action that would justify impeachment. Never mind, the crowd cries, let us have the verdict now…

…We can do the trial later.”, Ted Van Dyk, VP Humphrey’s assistant in the White House and 40+ years serving Democrat administrations and campaigns, The Wall Street Journal, May 22, 2017

“This is exactly how the Democrats attacked bankers after the 2008 financial crisis, except those bankers didn’t have the ability to fight back. In fact, nearly all were silenced by actual or threatened government investigations and/or lawsuits. To this day, the Obama Administration and Democrats in Congress did not prove a single crisis era allegation it made.”, Mike Perry, former Chairman and CEO, IndyMac Bank

Opinion

Anti-Trump Democrats Invite Chaos

If they succeed in bouncing the president from office, they may find that what comes next is even worse.

By Ted Van Dyk

 ‘A jackass can kick down a barn,” said the legendary Speaker Sam Rayburn. “But it takes a carpenter to build one.”

Democrats should reflect on that wisdom as they consider the special counsel now appointed to investigate President Trump’s alleged ties to Russia. In the short term, the inquiry will probably hurt Mr. Trump and feed attempts to drive him from office. But in the end the president’s attackers will pay a price.

The political and media hysteria surrounding the Trump administration lies somewhere on the repulsiveness scale between the Jacobin excesses of the French Revolution and the McCarthy era. Thus far the public knows of no presidential action that would justify impeachment. Never mind, the crowd cries, let us have the verdict now. We can do the trial later.

What about discussions between Trump campaign advisers and Russian or other foreign leaders? Don’t they count as high crimes and misdemeanors? No, such conversations take place all the time in national campaigns.

What about the firing of FBI Director James Comey ? Wasn’t that suspicious? No, Mr. Comey disregarded the Justice Department chain of command and the normal proprieties of his office. He made public statements about ongoing investigations. He allowed it to leak that the president had suggested leniency for Mike Flynn, the former White House adviser now under investigation. A presidential suggestion of that nature would be neither illegal nor unprecedented.

What about Mr. Trump’s disclosure of classified information during a meeting with Russian leaders? It’s a tempest in a teapot. The president has the authority to classify or declassify information as he wishes. I have witnessed other presidents doing it.

What about Mr. Trump’s executive order declaring a short-term pause on immigration from countries with active terrorist movements? It may have been poorly handled, but other presidents have done similar things.

What about all Mr. Trump’s flip-flopping? Shouldn’t a president be trustworthy and reliable? Yes, but when Mr. Trump has reversed his campaign pledges it has been mostly for the good.

If Mr. Trump were a conventional president, these missteps would be shrugged off as growing pains or considered worthy of only mild reproof. President Trump, it is true, lacks the knowledge, experience and temperament for the office. His crude narcissism is grating. He has carelessly contributed to his problems with heedless public statements. He nonetheless was duly elected and should be given the leeway that new presidents are traditionally afforded.

Critics, moreover, misread the temper of the American people. Most voters don’t much like Mr. Trump. But they like chaos less.

I spoke recently to a Democratic group consisting mainly of Bernie Sanders supporters. Many were searching for a constructive response to the Trump presidency. They were people, as the saying goes, seeking to light a candle rather than curse the darkness.

I suggested that they concentrate on developing alternatives to Mr. Trump’s proposals—on health care, taxes, the budget. “You mean we should help Trump?” someone asked. “No,” I answered, “you should help your country.” I was surprised by the outburst of applause that followed.

Democrats, in their all-out opposition to Mr. Trump, are missing real opportunities to influence policy. The tax-reform debate is a prime example. If Democrats were shrewd, they would try to negotiate a grand compromise, in which loopholes are scrubbed from the code and Social Security and Medicare put on sounder long-term footing. But to get there, purposeful polarization must give way to constructive engagement.

Trump haters disregard an old rule of politics and history: In the end, voters always choose order over disorder. Kicking Mr. Trump to the curb wouldn’t return the country to the pre-Trump status quo. It would likely bring forth new law-and-order leadership more disciplined and conservative than Mr. Trump’s.

Mr. Van Dyk was active for more than 40 years in Democratic administrations and campaigns, including as Vice President Humphrey’s assistant in the White House.

“If you read this, I know it sounds like very boring, very detailed “political stuff”, but if you have ever had to deal with these federal agencies, like I have, and find out that they “hold (almost) all the cards” over individual American citizens, in violation of our Constitution, you would understand how important and powerful these Bills are for America…

…Glad also to see fabulous Senator Mike Lee say “it’s our fault” (Congress) this happened, we inappropriately abdicated our duties to the Executive Branch”. If you control corporate legal counsel decisions, ask your law firm where they stand on these Bills. I bet most won’t tell you, because the way it is today creates more legal work for them and also a revolving door career between their law firms and these unaccountable federal bureaucracies.”, Mike Perry, former Chairman and CEO, IndyMac Bank

May 17, 2017, Rachel del Guidice, The Daily Signal

3 Bills Sen. Mike Lee Thinks Could Shift Power ‘Back to the People’

mike-lee-FedSoc-1250x650.jpg

Sen. Mike Lee, R-Utah, says Congress must reassert its lawmaking role. (Photo: Bill Clark/CQ Roll Call/Newscom )

Over the past eight decades, Congress has gradually relinquished its lawmaking role and left it to the administrative state, said a conservative senator at a Capitol Hill event on Wednesday.

“Many Americans now feel that they are not in control of their own government,” Sen. Mike Lee, R-Utah, said during an event hosted at the Federalist Society’s fifth annual Executive Branch Review Conference. “The administrative state is designed to be insulated from the will of the people.”

The Utah senator said that one way he is working to combat this phenomenon is through an initiative he has started called Article One Project.

“Our goal is to develop and advance and hopefully enact an agenda of structural reforms that will strengthen Congress by reclaiming the legislative powers that have been ceded to the executive branch,” Lee said.

Lee said that lawmakers are to blame for the shift in power.

“We are not, in fact, the victims, we are the perpetrators,” Lee said, adding:

We have done this willfully because it makes our job easier. It is a whole lot easier and less politically risky to have somebody else do the lawmaking than it is to do the lawmaking yourself.

There are several pieces of legislation, Lee said, that could help address executive overreach.

1.) REINS Act

The REINS Act, which has passed the House but has yet to pass the Senate, would make progress in regaining ground Congress has lost, Lee said.

This proposed law would require both congressional and presidential approval of major rules, which “have an economic impact of $100 million or more,” Rep. Doug Collins, R-Ga., wrote in a recent op-ed.

“Under this law, the specialized know-how within each agency would still be allowed to contribute to the regulatory process,” Lee said.

“But ultimately, Congress would be responsible for every major regulation that went into effect. This would make it easier for American voters to know who to blame for bad policies. As things currently stand, lawmakers can have it both ways.

2.) Separation of Powers Restoration Act

The second piece of legislation Lee suggested to help restore congressional authority is the Separation of Powers Restoration Act, which has passed the House in 2016.

In a 2016 op-ed in The Hill, Rep. John Ratcliffe, R-Texas, warned that “The practice of administrative agencies engaging in de facto ‘lawmaking’ was exacerbated by a 1984 Supreme Court decision, [Chevron U.S.A., Inc. v. Natural Resources Defense Council], which determined that courts must defer to agencies’ interpretation of ambiguous laws as long as their interpretation is deemed ‘reasonable.’”

The Separation of Powers Restoration Act, which Ratcliffe has introduced in the House again this year, would “[reverse] the 1984 Supreme Court decision that established the ‘Chevron doctrine,’ placing the power to determine ambiguous laws back into the hands of the judiciary.”

“The bill would end the dysfunctional status quo that tilts the legal playing field in favor of bureaucrats who pass the legislation to [place] federal law in the hands of legislators and the power to write and judges power to interpret just as the Constitution,” Lee said.

3.) Agency Accountability Act

The third piece of legislation, the Agency Accountability Act, will do exactly what its name implies, Lee said, and will hold agencies accountable.

The act, which has been introduced in the House, would “make federal agencies accountable … by directing most fines, fees, and unappropriated proceeds to the Treasury instead of letting federal agencies keep the money and then spend it as they see fit,” the Utah senator said.

Right now “agencies have the ability to use funds received through fines, fees, and proceeds from legal settlements without going through the formal appropriations process, thus avoiding congressional oversight,” according to a report from The Heritage Foundation’s Justin Bogie, a senior policy analyst in fiscal affairs.

If signed into law, this legislation would help restore Congress’ role in overseeing how money is spent, Lee said.

“You see the Constitution has this pesky little provision that … Congress has the power and the responsibility to direct spending of federal dollars. The power of the purse is one of Congress’ most potent tools for controlling bureaucracies,” Lee said.

While Lee said that many Americans feel like they have lost control of their government, legislation like the Agency Accountability Act would be a remedy.

“Passing the Agency Accountability Act will go a long way in putting Congress, and by extension, the American people, back in charge of the federal bureaucracies and specifically, the way they spend money,” Lee said.

Lee urged Congress to act.

“If we are able to pass even one of these legislative proposals … then we will have made real progress toward listening to the people and making sure that our government itself has to listen to the people,” Lee said, adding:

If we can pass all three bills, it would constitute a fundamental, generational shift of power in the country, a shift of power back to the people.

“The liberal mainstream media lied about the root-causes of the 2008 financial crisis, and time/historical evidence has either disproved their claims or not proved them…

…One positive for me personally, from what President Trump is experiencing with them, at least half of America (maybe much more) now understand the media in America is massively-biased towards liberal positions and will say anything (with little regard for the facts and the truth) to further their side’s agenda.”, Mike Perry, former Chairman and CEO, IndyMac Bank

May 18, 2017, Adriana Cohen, The Boston Herald

Adriana Cohen: The media has lost its marbles

Adriana Cohen Thursday, May 18, 2017

Credit: AP photo

‘TREATED WORSE’: President Trump gives the commencement address yesterday at the U.S. Coast Guard Academy.

Just five months in, 2017 is going down in history as the year that gave us the worst media bias America has ever witnessed.

It’s worse than slanted, it’s flat-out rigged against our president and he knows it. Yesterday at the Coast Guard Academy commencement ceremony, President Trump said, “Look at the way I have been treated lately, especially by the media. No politician in history, and I say this with great surety, has been treated worse or more unfairly.”

The days of honest, ethical journalism guided by facts, not political motives, have been replaced by agenda-driven activism by political operatives masquerading as mainstream media journalists.

Each and every week, they have manufactured a continual cycle of “fake news” crises about the Trump administration for the sole purpose of smearing the Republican leader so that Democrats can take back power in the midterms and 2020.

Hopefully voters are savvy enough to see through the daily smear campaign against our president by The Washington Post, The New York Times, the Huffington Post, the New York Daily News, the AP and scores of other left-leaning media outlets whose reporters wake up every morning with one goal: take down Trump.

Democratic leaders, CNN and other outlets have been pushing the false narrative that the Trump administration may have colluded with the Kremlin to steal the election from Hillary Clinton. If there was any evidence to support that, rest assured it would have been leaked by now. There’s no there there. No evidence has been produced to suggest anyone committed a crime, let alone colluded with anyone.

Just this week the media lost its marbles over the notion Trump may have shared intelligence with Russian officials in a recent White House visit. Never mind that there is no proof Trump divulged anything inappropriate, or that the media didn’t give a hoot when Obama did it last summer. Democrats get a pass.

Four dead Americans in Benghazi? The media yawned. Targeting of conservatives by the IRS during the Obama administration? The media snored. Colluding with the Iranians in secret deals, with massive money transfers and releasing dangerous actors? That they considered a triumph of diplomacy. But if Trump orders two scoops of ice cream, he’s Dr. Evil and CNN devotes multiple segments to it.

Each and every day the words “impeachment” and “Watergate” are floated by Democrats and anti-Trump media based on trumped-up, distorted information. Every week, they declare a new constitutional crisis.

But Trump won the election despite that toxic media environment. Voters aren’t buying it anymore.

Adriana Cohen is host of “The Adriana Cohen Show,” heard at noon on Boston Herald Radio. Follow her on Twitter @AdrianaCohen16.

“JPM Chairman and CEO Dimon says President Trump’s economic and national security people and policies (even some of the tough trade talk) are pretty fabulous. He also says that inappropriate government mortgage regulations have cost the economy 2 million jobs. Don’t believe me? Read this article. Who is responsible for those lost 2 million jobs? Clearly, #1 on that list would be US Senator Elizabeth Warren, the architect of the CFPB…

…(which banned mortgages people want and institutions want to make) and dramatically increased regulation and compliance. It now costs roughly double to make a mortgage in America. It went from like $4,000 to $7,000/$8,000, according to the MBA’s economists, with nothing to show for it….other than the 2 million lost jobs! Dimon is a Democrat, and because he is still running a big Too Big to Fail Bank…he doesn’t take on the Democrats or blame Warren directly….read it and see for yourself. ”, Mike Perry, former Chairman and CEO, IndyMac Bank

May 8, 2017, Matt Turner, Business Insider

JAMIE DIMON: There is a ‘national catastrophe’ and ‘we should be ringing the alarm bells’

Matt Turner
Business InsiderMay 8, 2017
Jamie Dimon
Jamie Dimon

(Business Insider)

Jamie Dimon is sounding the alarm.

The chairman and CEO of JPMorgan Chase has taken the opportunity on a number of occasions in recent weeks to highlight problems in America, including its failing education system, stifling bureaucracy, and high levels of incarceration and opioid deaths. He has set out some solutions along the way.

Dimon’s influence beyond Wall Street seems to be at a peak. He’s the chairman of the Business Roundtable at a critical time, with a pro-business White House opening its doors to business CEOs. He crosses the political divide: a registered Democrat, he said recently he no longer cares for party politics. The bank he heads last month reported a strong set of first-quarter profits, with $6.4 billion in net income.

Business Insider travelled on May 5 to speak with Dimon at the Alfred E. Smith Career and Technical Education High School in the South Bronx, New York. We talked about education, the economy, and the Trump administration. JPMorgan Chase had just announced a $6 million investment in the Bronx as part of its $75 million New Skills for Youth initiative.

This interview has been edited for clarity and length.

Matt Turner: Why are initiatives like this one in the South Bronx so necessary right now?

Jamie Dimon: We’ve made a huge effort globally and in the US, in getting kids jobs. This is one piece. The South Bronx and inner-city schools need it more than most. It’s our hometown; JPMorgan Chase banks a lot of people here. My wife [Judy Dimon] does a lot here, and so they’ve been pounding it: “We need to do more in the South Bronx.” We need to get kids getting out of high school, who go on with a job, or go on to college and that leads to a job.

New York Governor Andrew Cuomo announces a $1.8 billion project to transform the South Bronx by reconstruction of the Bruckner-Sheridan Interchange in New York City, United States in this March 19, 2017 handout photo. Kevin P. Coughlin/Office of Governor Andrew M. Cuomo/Handout via REUTERS
New York Governor Andrew Cuomo announces a $1.8 billion project to transform the South Bronx by reconstruction of the Bruckner-Sheridan Interchange in New York City, United States in this March 19, 2017 handout photo. Kevin P. Coughlin/Office of Governor Andrew M. Cuomo/Handout via REUTERS

(New York Gov. Andrew Cuomo announces a $1.8 billion project to transform the South Bronx.Thomson Reuters)

We’re making an effort. We have some great partners here. If you see the school, it works. You saw the kids today. They’re all getting jobs, they’re smiling, they’re proud of themselves. That’s what we need to do in inner-city schools.

Turner: You’ve said that “the lack of economic opportunity for young people in the South Bronx is a moral and economic crisis.” How did this happen?

Dimon: It’s not just this area. You have unemployment now going below 4.4% this morning, but if you go to a lot of inner cities, unemployment among youth — think ages 17 to 25 — is 20% or 25%. The fact that parts of the country are doing well doesn’t mean we shouldn’t focus on the part that isn’t.

Part of the problem is that jobs haven’t been done locally. These kids can get jobs with the MTA. There’s a distribution company down here, they know what these kids have been trained in, they were part of the training effort. Locally, if you go to Texas, they need welders. If you go to other areas, they need people who can do construction, plumbing, electrical work. Business has to be involved locally with civic society, in this case schools, to get the kids trained to have a job.

There are plenty of jobs out there. When people talk about the problems, I would say, “What’s the solution? What’s the outcome you want? How are you going to get there?” Civic society has to do it together with business. It’s not going to work with one without the other.

Turner: You talked recently about a lost generation, of people being left behind. What has the effect of that been?

Dimon: When people talk about people being left behind — middle wages have not gone up for years, and we should recognize that, and there I think we need growth and skills — but there are these other people who have been left behind. When I say out loud, “Fifty percent of inner-city schoolkids do not graduate from high school,” that is a national catastrophe. We should be ringing the alarm bells. It’s not fair.

Colin Powell
Colin Powell

(Colin Powell.Paul Morigi/Getty Images)

We were a land of opportunity. You can never have equal outcomes, but you can have equal opportunity. Among those kids, we might have had a Colin Powell, an Albert Einstein, we’ll never know. I just think it is part of running a good society. People should get involved in fixing that particular problem.

Turner: The idea of going to school, getting a job, working your way up, buying a house, that’s a part of the American dream, and yet all those things seem harder to do. Is the American dream still available to as many people now as it used to be?

Dimon: We have the best country on the planet. We have schools, universities, food, water, energy, peaceful neighbors, low corruption, you name it, deepest and widest capital markets. That doesn’t mean we shouldn’t identify problems. We don’t have a divine right to success. If you look at it, what are the problems?

One is, middle-class wages haven’t gone up. One is, lower-class wages haven’t gone up enough to create a living wage. One is, people losing jobs, more to automation than anything else. The solution? It’s retraining, relocation — it’s income assistance. We’re just trying to recognize those things, that we’ve left some people behind. And we haven’t done a particularly good job of fixing it, Democrat or Republican. My own view, this is not a political issue. It’s not a knee-jerk reaction from either side. It’s training, schools, getting growth going again.

Detroit would be a great example. If you look at Detroit, that mayor, it’s been a train wreck for 40 years, the population has gone from 2 million to 700,000. This Mayor comes in, and he talked about streetlights, sanitation, jobs, policing, schools, affordable housing. He’s doing it all, and it’s growing for the first time in 30 years. Literally, one man. But that one man couldn’t do it without business. You’ve got wonderful people in Detroit, like Dan Gilbert, JPMorgan Chase. And business couldn’t have done it without a political environment where they wanted to improve things. If you had an antibusiness environment there, it would still be down there.

Construction is seen on a new housing development along the riverfront in Detroit, Michigan, December 9, 2015. REUTERS/Rebecca Cook
Construction is seen on a new housing development along the riverfront in Detroit, Michigan, December 9, 2015. REUTERS/Rebecca Cook

(Construction on a new housing development along the riverfront in Detroit.Thomson Reuters)

Turner: For that lost generation, there’s some anger at the global elite.

Dimon: I kind of agree with it, when you leave people behind, and those people who are left behind, it’s not their fault, it’s the leaders of the institutions. There’s always going to be an elite. You can have an elite in a communist society. It is the leaders, something went wrong, and the leaders collectively are responsible.

There’s some more terrible numbers — men, age 25 to 55, the labor-force participation rate is down 10%. That’s unbelievable. There are 35,000 dying of opioids every year. Seventy percent of kids age 17 to 24 can’t get into the US military because of health or education. Obesity, diabetes, reading and writing. Is that the society we wanted? No. We should be working on these things, acknowledge the flaws we have, and come up with solutions. Not Democrat. Not Republican. Not knee-jerk.

Any good job is a good job. This whole concept of a dead-end job? It’s not true. I’ve heard it my whole life. Jobs lead to dignity. If you’re good at the first, then you can get the second. Jobs lead to household formation. Jobs are a better solution for society. The other part, the expanded earned-income tax credit, which can help the lower paid have more a living wage, which will lead them to do more. It will help small business. It won’t help big business.

Turner: What impact has what you’re describing had on the economy? Can the US get back to 3% or 4% growth?

Dimon: I’ve been clear. I think the reason we’re at 2% and not 3% is money spent on wars, the education system leaving people behind, technology has left some people behind. It’s a lot of things we did. Government shutdowns. I don’t think it had to be that way. I don’t think it was embedded in something. It was the decisions we made. We should do something about fixing it. I’m comfortable we’ll fix it. People always say to me, “What if it doesn’t work?” If it doesn’t work, we redouble our effort. We’re not going to cry like a bunch of babies. We’re going to redouble our effort.

Detroit is a great example. It is working. The population is going up, unemployment is going down, people are moving back in. You can go to downtown Detroit today, an area I’m familiar with because I’ve been going to Detroit for 30 years or so. You wouldn’t have walked around downtown Detroit. Now, it is vibrant, music, restaurants, it’s unbelievable. It actually works at the local level if you do it right.

Jamie Dimon, Chairman and CEO of JPMorgan Chase & Co. speaks during the Milken Institute Global Conference in Beverly Hills, California, U.S., May 1, 2017. REUTERS/Mike Blake
Jamie Dimon, Chairman and CEO of JPMorgan Chase & Co. speaks during the Milken Institute Global Conference in Beverly Hills, California, U.S., May 1, 2017. REUTERS/Mike Blake

(Jamie Dimon.Thomson Reuters)

Turner: Why isn’t that happening in more places?

Dimon: I wouldn’t say it isn’t happening elsewhere. Good reporters have written about little towns where it is happening. And then there are towns where it’s not.

Turner: JPMorgan Chase’s investment in the South Bronx is from a $75 million fund, and the bank has a $250 million fund focused on similar issues. Does corporate America need to do more?

Dimon: I’m the chairman of the Business Roundtable, which is 200 of the largest companies in America, and one of our initiatives is around work skills, things exactly like this. Think of disseminating best practices among government, among business. A lot of businesses do it. If you went to any major company, they’ll give you a good list of the stuff they’re doing. We just need to do more.

Turner: And when you talk to those CEOs about the need for that kind of an effort, what’s their response?

Dimon: They’re totally on board. Most CEOs are patriotic and most CEOs can see the problems in front of them, and they want to do something about it. We don’t always agree about the ways and means, but the objective? We’re totally together.

Turner: You’ve talked about the pro-business approach this administration is taking, and that being a welcome change. How does that fit in to what we’re discussing?

Dimon: People get boxed up in personalities and stuff like that. The Trump administration’s [economic] agenda is the right agenda. Corporate taxes have been driving capital and brains and companies overseas for a decade. It has caused huge damage in investment and jobs and productivity. It was a mistake. We have to fix it. Counterintuitively, that usually helps middle-class wages, and lower-class wages, and job formation.

The second issue is regulation. If you talk to anyone involved in business — forget banks and big business — talk to small businesses — do it yourself, don’t ask me — they’ll tell you it’s crippling. Small-business formation is the lowest it has ever been in a recovery, and it’s really for two reasons. One is regulations and the second is access to capital for people starting new businesses.

Then there is infrastructure. You might be shocked to find out, we haven’t built a major airport for 20 years. China built 75 in the past 10 years. It takes 10 years to get all the permits to build a bridge today. Ten years? What happened to the good old can-do America? Where is “We get it done, we work together”? We’ve become this bureaucratic, stifling environment. I’m not talking about violating environmental things — I’m talking about building a bridge, getting things going, getting people to work together. Even some of my friends noticed there was a bridge in Cambridge being built across the Charles River. It was a teeny little bridge. It took six years. Don’t tell me that’s not corruption. I don’t care what you say — that’s corruption.

Trump Jamie Dimon
Trump Jamie Dimon

(Dimon with President Trump.Kevin Lamarque/Reuters)

Turner: How confident are you that with the current administration there will be change?

Dimon: The first thing you do is acknowledge where some of the problems are. They’ve got real professionals on the ground, deeply respected, both on the national-security and state side, and the economic side, and they’re just staffing up. Let them go at it.

Remember, it won’t be up to them. They’ve got to work with Congress, with Democrats and Republicans. I think a lot of these things that are good for all of America, we should get the Congress, whether it’s Democrat or Republican, to say, “Let’s get those things done.” Those things are good for all Americans. A lot of these things have hurt the average American. When they look at the banks and they say, “Well, the bank’s talking its own game,” I am telling you, what we’ve done in mortgage lending, our inability to have proper regulations around mortgages, has hurt average Americans. First-time buyers, immigrant buyers, prior defaults, self-employed, because they can’t get a mortgage. Will it make a big difference to JPMorgan Chase? No, but you’re hurting my fellow citizens. Let’s go at it, and let’s fix it.

That mortgage example — our economists think that one example would have improved GDP growth by 0.3% a year. Over five years, that’s 1.5% — 1.5% would be 2 million jobs. If that’s true, let’s do something about it. Let’s not sit here and twiddle our thumbs and have Democrats and Republicans yelling and screaming at each other. We’re hurting average Americans.

Trump Air Force One
Trump Air Force One

(AP Photo/Jose Luis Magana)

Turner: Do you think your voice and the voices of other CEOs carry more weight now with the present administration?

Dimon: I think the administration is talking to everybody. They are talking to CEOs, they’re talking to unions, I’m told the president has Democrats and Republicans over for lunch and dinner and on Air Force One. As the head of the BRT, the CEO, who is Josh Bolten, who we recently hired, and I recently met with a whole bunch of unions about what we could do that would be better for everybody. It was a great meeting. We’re going to try to get people to work together to fix these problems. It takes collaboration. It’s not going to work if we all hate each other.

Turner: You say the Trump administration’s economic agenda is the right one. Is there a risk that some of the benefits from that economic agenda could be undone by other policies like trade and immigration?

Dimon: It is possible. If you’re talking about immigration and trade, people have made some pretty strong statements on that, but my own view is that they have laid out some real trade issues that are accurate for both China and Mexico, where we can improve upon the trade agreements, and I think we’ll improve on the trade agreements. I may be wrong, but I think that is their objective, and they’re using tough words.

I think immigration has been one of the vital things about the growth of America. I’m the product of grandparents who all immigrated from Greece. I hope eventually we have proper immigration. Good people who have paid their taxes and haven’t broken the law, get them into citizenship at the back of the line. I think that can be worked out. If people get educated here, and they’re foreign nationals, get them a green card. I’ve even heard the president speak about that. There are things to do to make immigration work for all of America.

“Long, but excellent National Review article and right on point. I became interested in this issue, when I (shockingly) saw how our liberal government and the media who support it, lied about me, IndyMac Bank, and the causes of the 2008 financial crisis. It woke me up to the Left’s lies about much of what is really important,…

…….as compared to Trump’s ridiculous and really trivial lies. That’s why I have spent so much time and energy on this blog, documenting the facts and truth about me, IndyMac Bank, and the financial crisis.”, Mike Perry, former Chairman and CEO, IndyMac Bank

Victor Davis Hanson, May 2, 2017, National Review

You Gotta Lie

why-progressives-lie-leftist-agenda-requires-deception.jpg

by VICTOR DAVIS HANSON May 2, 2017 4:00 AM

Oh! What a tangled progressive web we weave…

Red/blue, conservative/liberal, and Republican/Democrat mark traditional American divides. But one fault line is not so 50/50 — that of the contemporary hard progressive movement versus traditional politics, values, and customs.

The entire menu of race, class, and gender identity politics, lead-from-behind foreign policy, political correctness, and radical environmentalism so far have not won over most Americans.

Proof of that fact are the serial reliance of their supporters on deception, and the erosion of language on campus and in politics and the media. The progressive movement requires both deceit and euphemism to mask its apparently unpopular agenda.

What the Benghazi scandal, the Bowe Bergdahl swap, and the Iran Deal all had in common was their reliance on ruse. If the White House and its allies had told the whole truth about all these incidents, Americans probably would have widely rejected the ideological premises that framed them.

In the case of Benghazi, most Americans would not fault an obscure video for causing scripted rioting and death at an American consulate and CIA annex. They would hardly believe that a policy of maintaining deliberately thin security at U.S. facilities would encourage reciprocal local good will in the Middle East. They would not agree that holding back American rescue forces was a wise move likely to forestall an international confrontation or escalation.

In other words, Americans wanted their consulate in Benghazi well fortified and protected from seasoned terrorists, and they favored rapid deployment of maximum relief forces in times of crises — but, unfortunately, these were not the agendas of the Obama administration. So, to disguise that unpleasant reality, Americans were treated to Susan Rice’s yarns about a spontaneous, unexpected riot that was prompted by a right-wing video, and endangered Americans far beyond the reach of U.S. military help.

Ditto the Bowe Bergdahl caper, the American deserter on the Afghan front. Aside from the useful publicity of “bringing home” an American hostage, there was an implicit progressive subtext to both his earlier flight and eventual return: Young introspective soldiers are often troubled about their nation’s ambiguous role in the Middle East and so, understandably, sometimes err in their search for meaning. When they do, and when they perhaps “wander off,” the government has win-win resources to address their temporary lapse — in this case, killing two birds with one stone by downsizing the apparently repulsive Guantanamo Bay detention facility and returning punished-enough Taliban combatants to their families.

What Susan Rice (ostensibly the go-to consigliere in such deals) could not say is that the Obama administration released five dangerous terrorists in order to bring home one likely deserter, whose selfish AWOL behavior may have contributed over the years to the injury or even deaths of several American soldiers tasked with finding him. Instead, we got the lie that Bergdahl was a brave solider who served with honor and distinction and was captured in mediis rebus on the battlefield, with the implication that his personal odyssey inadvertently led to the bonus of returning in-limbo foreign detainees and reducing the population of an embarrassing gulag.

We keep learning about all sorts of disturbing and leaked secret side agreements to the Iran Deal. Without them, the progressive agenda underlying the concessions was bound to be unpalatable to the American people: secret nocturnal cash ransoms to obtain American hostages (hostage-taking is an Iranian theocratic specialty), secret side deals with international agencies to define down on-site inspections, and secret “flexibility” on Iran ballistic-missile development.

But on a deeper level, the Obama administration apparently either did not believe that Iran was a truly belligerent, anti-American theocracy bent on a baleful Middle East hegemony through acquiring nuclear weapons, or else assumed that Iran’s regional ambitions were understandable and morally equivalent to any large nation’s desire for such strategic influence. Either way, the results were deception and lies rather than honesty about these assumptions.

The foundations for the unspoken, progressive faith in catastrophic man-caused global warming are self-evident. Many Western elites believe that modern, free-market industrial growth and consumer capitalism endanger the planet. They bring out the worst in both the bourgeoisie and the undereducated, victimized poor: greed, acquisitiveness, and shallow material values. The remedy and indeed duty for reflective and enlightened elites (who alone have transcended the rat race and by their very success have grown immune from, and wise to, the contradictions of capitalism) is to change the economic foundations of modern Western life — in a radical fashion akin to the 19th-century romantic yearning for a pre-industrial, less environmentally exploitive past.

The catch, however, is that most Americans believe that oil wells, mines, freeways, dams, cars, reservoirs, and factories — and the granite counters, stainless-steel fridges, and big-screen TVs that derive from them — are largely godsends, ensuring a good life undreamed of by their grandparents. Or they believe that most accompanying deleterious effects on the environment, such as slight and periodic changes in temperatures, are outweighed by the benefits of industry and can be soon ameliorated by rapidly advancing scientific and technological remedies.

The result is an impasse. To square the circle, progressive vocabulary adjusted. Global warming became “climate change,” on the theory that when droughts naturally were followed by snow and rain, snow and rain were only further proof of man-caused rising temperatures that needed immediate redress through larger government intervention. It was not enough to warn that the industrial age might have contributed to an acceleration of natural and episodic warming of the planet (a documented cyclical pattern of the past); instead end-of-world, apocalyptic scenarios were necessary to reconfigure the very industrial base of modern life.

The result is that today, any natural climatic extremity — ice to searing heat, snow or drought, both mud and dust, receding or advancing waters, normal or abnormal temperatures — becomes media fodder for the narrative of man-caused, excessive carbon releases that can be remedied only by costly reduction of the West’s modern commerce and industry that fuels extravagant, self-indulgent consumerism.

Yet imply that, and the public would revolt. Instead, it is wiser to suggest that the climate is being altered by human shortsightedness and extravagance and that the change can be stopped by altruism and moral sacrifice. Inefficient and subsidized solar and wind power therefore become ethically and culturally preferable to more practicable but retrograde nuclear power, hydroelectric, and natural-gas generation. As for a publicly green Bono, John Kerry, or Al Gore, who in his private life might gulp down an inordinate amount of aviation fuel or hoard too many square feet of living space, we appropriate the implied Soviet argument of the apparat and the dacha: Only by revolutionaries faring well can the revolution itself fare well.

No one wishes to discuss candidly that universities are no longer free bastions of inquiry but are descending into would-be boot camps to train progressive shock troops. Careers, reputations, and lots of money are invested in stifling free expression, a project predicated on changing the nature of students, the curricula, and the very atmosphere of the traditional university.

The predicable result is again linguistic subterfuge.

If unprepared students are frustrated that special admittance does not de facto equate to college success or graduation, the university must make the necessary Animal Farm–like adjustments. Segregation by race and gender becomes “safe spaces.” Ancient stress, the stuff of cramming for finals and paper deadlines, gets embedded into politics, as snowflakes are “traumatized” by a culturally appropriated earring or a gendered pronoun. Free speech that can be challenging and liberate young minds becomes “hate speech” and is banned. Odious censorship is redefined as mere “trigger warnings.”

Confederate nullification that reminds us of the chaotic consequence of states’ defying federal law becomes “sanctuary cities,” as if illegal-alien lawbreakers were 21st-century versions of fugitive slaves seeking sanctuary from plantation bounty hunters.

When “sexual liberation” of the 1960s eventually led to a crass and crude dating atmosphere that disadvantaged young women (the male was assured that mutually consenting sexual congress demanded not even momentary commitment or even postcoital gentlemanly behavior and deference), it was recalibrated as “sexual assault” — as if occasional female naïveté and frequent male boorishness and selfishness in matters of sex were now criminal matters (though exempt from the bother of the Bill of Rights).

Nowhere was the progressive project more in need of stealth than the proverbial War on Terror that followed the mass murdering on 9/11. Apparently, it was impossible for the Obama administration to concede that terrorism and indeed global conflict in the 21st century were largely dividends of the radicalization of Islam, and fueled often by the inability of traditional Muslim societies to adjust to the radical globalization — and indeed Westernization — of the planet.

Conceding that would imply the culpability of autocratic and theocratic Muslim leaders (along with traditional and endemic gender apartheid, tribalism, anti-Semitism, religious fundamentalism and intolerance, and statism). It’s far easier to fault the pernicious legacy of 19th-century European colonialism.

Empiricism would have allowed discussions of inherent differences between a post-Reformation Western Christianity and a pre-reformation Islam; instead, progressives adhered to boilerplate multicultural moral equivalencies. Identification of widespread abhorrent practices in Middle Eastern societies — female genital mutilation, honor killings, state violence against gays, and racism – would lead to difficult intellectual and political truths. But keeping the focus on the ’Wests supposed post-colonialism, imperialism, and exploitation provides easy fodder for the race, class, and gender appetites of careerist Western elites.

To square that circle, terrorism then became “man-caused disasters” (as if Buddhist and Christians were on a rampage in Europe). Anti-terrorism was “an overseas contingency operation” (as if hunger in Haiti was morally equivalent to the battle in Anbar Province), while jihadism became a mere personal odyssey or journey (who is to say that bin Laden was not misunderstood by followers seeking spiritual growth?). The Muslim Brotherhood in Egypt was rendered “largely secular,” as if Mohamed Morsi sought to bring what he learned at USC to good governance in Cairo. “Workplace violence” was murdering 13 soldiers in cold blood at Fort Hood while shouting “Allahu akbar,” on the theory that deranged employees sometimes have shot many on the job, though without the loud religious proclamations.

History got into the act as well. President Obama assured us on no evidence that a Cordoba without Muslims in the late 15th century, at the time of the Christian Inquisition, was a bastion of Islamic tolerance (and later added that we “high-horse” Christians should remember the Crusades of a millennium ago). For the progressive project, history is not tragic. It’s a melodrama to be used for contemporary political agendas, through separating bad people from good people of the past, as ascertained through contemporary progressive standards retroactively applied to earlier centuries.

In fairness, what is the anti-multicultural, anti–morally equivalent, anti-utopian pacifist alternative? To tragically confess that religions are not mostly alike? That blowing up somebody on the pretext of ending oppression does not mean there is real oppression rather than inherent selfishness and evil? To assume that those who most damn the West are themselves the most eager to flee to the West? To accept that deterrence sways behavior more than does concession, given the unchanging nature of man?

Without ruse, there can be no progressive project — as was true in the past of any illogical and unappealing ideology.

In short, you gotta lie.

— NRO contributor Victor Davis Hanson is a senior fellow at the Hoover Institution and the author of The Second World Wars: How the First Global Conflict Was Fought and Won, to appear in October from Basic Books.

“The well-intended federal government is no better a lender to Americans than the private sector. In fact, you could argue that with inability to discharge federal student loans in bankruptcy…

…and the government’s ability to garnish wages, they are worse. Doesn’t this destroy the crisis era narrative (from the Left and mainstream media) of predatory private sector mortgage lenders? I think so. P.S. I also think you could make an argument that the Obama Administration wanted everyone in school (and used this borrowing to facilitate it) to keep the unemployment rates (especially among the young) artificially lower post-crisis.”, Mike Perry, former Chairman and CEO, IndyMac Bank, April 24, 2017

Josh Mitchell, April 24, 2017, The Wall Street Journal

U.S.

The U.S. Makes It Easy for Parents to Get College Loans—Repaying Them Is Another Story

The federal Parent Plus loan program has millions of borrowers, many with subprime credit ratings; its default rate exceeds the rate for U.S. mortgages at the peak of the housing crisis

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Rebecca McEvoy, a retired public-school teacher coping with multiple sclerosis, borrowed $84,000 through Parent Plus to help her oldest son through an art and design college. PHOTO: MADDIE MCGARVEY FOR THE WALL STREET JOURNAL

By Josh Mitchell

Millions of U.S. parents have taken out loans from the government to help their children pay for college. Now a crushing bill is coming due.

Hundreds of thousands have tumbled into delinquency and default. In the process, many have delayed retirement, put off health expenses and lost portions of Social Security checks and tax refunds to their lender, the federal government.

Student loans made through parents come from an Education Department program called Parent Plus, which has loans outstanding to more than three million Americans. The problem is the government asks almost nothing about its borrowers’ incomes, existing debts, savings, credit scores or ability to repay. Then it extends loans that are nearly impossible to extinguish in bankruptcy if borrowers fall on hard times.

As of September 2015, more than 330,000 people, or 11% of borrowers, had gone at least a year without making a payment on a Parent Plus loan, according to the Government Accountability Office. That exceeds the default rate on U.S. mortgages at the peak of the housing crisis. More recent Education Department data show another 180,000 of the loans were at least a month delinquent as of May 2016.

“This credit is being extended on terms that specifically, willfully ignore their ability to repay,” says Toby Merrill of Harvard Law School’s Legal Services Center. “You can’t avoid that we’re targeting high-cost, high-dollar-amount loans to people who we know can’t afford to repay them.”

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Parent Plus is one thread in a web of higher education loan programs that have come to resemble the subprime mortgage industry a decade ago, given the shaky quality of many of the loans.

The number of Americans with federal student loans, including through programs for undergraduates, parents and graduate students, grew by 14 million to 42 million in the decade through last year. Overall student debt, most of it issued by the federal government, more than doubled to $1.3 trillion over that period.

The financing fueled a surge in college enrollment. Between 2005 and 2010, enrollment grew 20%, the biggest increase since the 1970s. The Obama administration supported such lending in an effort to widen access to college education.

Nearly four in 10 student loans—the vast majority of them federal ones—went to borrowers with credit scores below the subprime threshold of 620, indicating they were at the highest risk of defaulting, according to a Wall Street Journal analysis of data from credit-rating firm Equifax Inc. That figure excludes borrowers, such as many 18-year-old freshmen, who lacked scores because of shallow credit histories. By comparison, subprime mortgages peaked at nearly 20% of all mortgage originations in 2006.

Roughly eight million Americans owing $137 billion are at least 360 days delinquent on federal student loans, nearly the number of homeowners who lost their homes because of the housing crisis. More than three million others owing $88 billion have fallen at least a month behind or have been granted temporary reprieves on payments because of financial distress. New research from Federal Reserve economists shows that most student-loan defaults are among borrowers who had weak credit.

Consumer advocates say defaults will continue to mount as loans taken out after the recession enter the repayment cycle.

An Education Department spokesman said the agency is reviewing Parent Plus and all other programs “to determine how best they can fit into the administration’s goals of helping students and taxpayers, while promoting excellence in education.”

President Donald Trump pledged during his campaign to ease families’ student-debt burdens, and his campaign at one point suggested privatizing federal student loans. Senate Republicans plan to study whether to restrict access to Parent Plus as part of a broader higher-education bill expected to be debated as early as this year.

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Parent Plus, created by Congress in 1980, allows parents to borrow to cover tuition and living expenses—often after their children borrow the maximum in undergraduate federal loans, capped by law at $5,500 a year for freshmen, $6,500 for sophomores and $7,500 for juniors and seniors. There is no limit to how much parents can borrow. Supporters say the program ensures students can go to schools of their choice.

Rebecca McEvoy, 53 years old, had been a retired public-school teacher for several years, coping with multiple sclerosis, when she turned to Parent Plus in 2010. She borrowed $84,000 to help her oldest son through an art and design college.

After he graduated, she successfully appealed to the government to have the debt expunged under a federal law that forgives balances for borrowers deemed permanently disabled.

Three years ago, she and her husband, Dave, 64, also a retired schoolteacher, turned to Parent Plus again to help their younger son, Alex, cover costs at Ohio University. Dave McEvoy took out the loans under his name. They borrowed $40,000 over the past several years and expect to borrow another $10,000 for his senior year.

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Ms. McEvoy shows a photo of herself with her sons. After she obtained a Parent Plus loan for one son, her husband got one for their other son. PHOTO: MADDIE MCGARVEY FOR THE WALL STREET JOURNAL

The McEvoys’ finances likely would have raised red flags with private lenders: They are living off modest pensions and have existing debts that eat up much of their income. “I have nothing left by the time I do my mortgage, the car, food and medical,” Ms. McEvoy says.

She says they have started paying down the debt and plan to continue, but they likely won’t be able to cover the full monthly payment once her son graduates in 2018.

Valerie Miller, Ohio University’s director of student financial aid, says she can’t comment on individual borrowers. She says the school counsels parents on all their options and on whether they will be able to make payments under Parent Plus.

Alex McEvoy, 20, says he plans to work in the tech industry and pay off his parents’ loans. “I’m like, ‘Mom don’t worry about it. It’s going to be fine,’” he says.

Obama administration officials, worried Parent Plus was heaping debt on high-risk borrowers, put in place tighter restrictions in 2011. But after schools argued stiffer underwriting would prevent many students from covering tuition, thus reducing college access for minorities and poor students, the administration rolled back the new rules.

“Without this program, our fear is that many of these families would be getting private loans at less-favorable terms or less-favorable repayment options,” or they wouldn’t be able to cover tuition at all, says Cheryl Smith, head of government affairs for the United Negro College Fund.

Research shows that restricting access to loans based on credit scores leads to lower college enrollment.

Enrollment in Parent Plus has grown quickly since the early 2000s. When the recession hit, private lenders tightened underwriting and many families saw savings and access to other forms of credit wiped out.

The number of families enrolled in Parent Plus jumped more than 60% since 2005, to 3.5 million as of Jan. 1. They owed roughly $77.5 billion—an average $22,000 per borrower, Education Department figures show.

Many borrowers are poor and older. More than one-third of such loans in recent years have gone to households that also received Pell grants, a student-aid program for families typically earning below $30,000 a year, federal data show. Other research suggests about one-third were single parents and a similar share lacked college degrees themselves.

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The program checks only a borrower’s past five years of credit for major blemishes such as bankruptcy or foreclosure, and the past two years for delinquency on debts of more than $2,085.

Consumer counselors are hearing from borrowers who make as little as minimum wage but borrowed tens of thousands of dollars and now can’t repay. Some expected their children to get good jobs and pay off the loans for them. In many cases, their balances have grown with interest—most Parent Plus loans issued over the past decade carried rates of between 6% and 8%—and thousands of dollars in fees the government charges when borrowers default.

Federal law prohibits borrowers from discharging student loans in bankruptcy, except in extremely rare circumstances. Instead, the government reduces tax refunds and Social Security checks of borrowers, leaving some with below-poverty incomes, the GAO reported in December.

“If Bank of America did that, Sen. [Elizabeth] Warren would have them in the biggest hearing you’ve ever seen,” says Betsy Mayotte, a consumer advocate and student-loan expert.

The number of Americans who had wages, tax refunds or Social Security checks reduced because of unpaid student debt increased 71% between September 2010 and September 2015, according to the GAO. About 41,000 Parent Plus borrowers were among one million student-loan recipients who had checks garnished in the 2015 fiscal year. The government garnished the Social Security checks of 173,000 borrowers from student-loan programs in 2015, up from 36,000 in 2002.

Other borrowers are seeking relief through plans that cut their monthly payments and ultimately forgive some debt. Enrollment in the plans, known as income-driven repayment, has more than doubled in the last three years. The government doesn’t publish data on parent participation.

“At some point, we’re going to have to realize that a bunch of loans that have been made are not going to be repaid,” says James Kvaal, former President Barack Obama’s top education adviser.

The GAO estimates taxpayers ultimately will forgive $108 billion on student loans made through the current fiscal year. By comparison, the savings-and-loan crisis of the 1980s cost the federal government roughly $181 billion, in today’s dollars, according to the Federal Deposit Insurance Corp.

Sherry McPherson took out Parent Plus debt in 2006 so her son could enroll in a seven-month certificate program at a Seattle for-profit school that teaches commercial diving. She was an unemployed single mother with thousands of dollars in credit-card debt, a car loan and a subprime credit score. She had just retired from the Army after suffering an injury in Iraq.

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James Kvaal, former President Barack Obama’s top education adviser, says that “at some point, we’re going to have to realize that a bunch of loans that have been made are not going to be repaid.” PHOTO: CHARLES VOTAW/AMERICAN EDUCATIONAL RESEARCH ASSOCIATION

The school, the Divers Institute of Technology, told Ms. McPherson she needed to borrow nearly $16,000 to cover remaining tuition after her son maxed out on undergraduate federal loans, she recalls.

Ms. McPherson, now 50, remembers telling the school’s financial-aid administrator she wouldn’t be approved because of her shaky credit and unemployment.

“She looked at me and said, ‘Look, all we need is your Social Security number,’ ” recalls Ms. McPherson. “They approved me in three minutes.”

She hasn’t worked since, partly because she attended college and graduate school herself. Her Parent Plus balance has more than doubled. Combined with her own student loans, she now owes more than $100,000 to the federal government.

Ms. McPherson has refinanced into an income-driven plan, which sets her payments at zero while she is unemployed.

She and her son plan to start a commercial-diving company that she hopes will allow her to pay off the debt. But when she applied for a $60,000 loan to start the company, a private lender approved her for $20,000, at a nearly 16% rate, because of her student debt.

John Paul Johnston, executive director at the Divers Institute, says the financial-aid officer who dealt with Ms. McPherson has left the school, and that he couldn’t confirm her account. The current financial-aid director, Caycee Clark, says the school informs parents of all their options, and that often Parent Plus is the only alternative for families with no savings. The school charges $26,000 tuition for a seven-month course.

As of late 2015, nearly two-thirds of borrowers with Parent Plus debt were between ages 50 and 64, the GAO said. Nearly four in 10 Americans age 60 and above with student debt—most of whom borrowed for children or grandchildren—reported skipping health-care needs in 2014, according to an analysis of survey data from the Consumer Financial Protection Bureau. That compares with 25% of above-60 Americans without student debt who said they went without such needs.

Harry Hagan, 66, of Syracuse, N.Y., delayed retirement to repay debt. He owes about $130,000 in Parent Plus debt after helping four children through college over the past decade, including a son still in school. He estimates the debt will rise to $175,000 once he graduates.

Mr. Hagan also owes about $60,000 to $70,000 in credit-card debt and a mortgage, and has a subprime credit score. He has no savings and receives a small pension from a previous employer.

A couple of years ago, he says, he called the company that services the loans and said there was no way he would be able to make the roughly $1,200 a month payment they were expecting. The company suggested he refinance into a 30-year plan.

“I said, ‘Listen, I’m 64 years old. In 30 years, God willing, I’ll be 94. There’s a very good chance I’m not going to make it. What happens?’” Mr. Hagan recalls asking.

“They said, ‘If you die before the loan goes up, it goes away.’ I said, ‘Good, let’s do that.’”

Appeared in the Apr. 25, 2017, print edition as ‘Parents Are Drowning in College-Loan Debt.’

“Chevron is a widely cited precedent, and precedents should never be casually overturned. But Chevron deprives Americans of their right to have judges who exercise their own independent judgment without systematic bias. Chevron is thus grossly unconstitutional — not least, a persistent denial of the due process of law…

…Judges have a duty to reject Chevron with candor and clarity. Judge Gorsuch has done this. Rather than be berated for it, he should be congratulated.” Excerpt from, “Gorsuch’s Collision Course with The Administrative State”, Philip Hamburger, The New York Times, March 20, 2017. (“It might seem a highly technical legal issue, until you as an individual American citizen get sued by these federal government bureaucracies, like I was by the Obama Administration’s FDIC and SEC, who both falsely accused me of violating their laws/regulations when my bank failed during the 2008 financial crisis……and your attorneys tell you that as a result of a terrible Supreme Court ruling called Chevron, the courts are required to defer to the federal bureaucracy and its often arbitrary and/or biased interpretation of its own laws and regulations, rather than give you a fair and independent review by a federal judge. That is clearly Unamerican and clearly Unconstitutional….but our judicial system has allowed this to exist for years, and harm individual Americans like me and American institutions!”, Mike Perry, former Chairman and CEO, IndyMac Bank

Philip Hamburger, March 20, 2017, The New York Times

The Opinion Pages | Op-Ed Contributor

Gorsuch’s Collision Course With the Administrative State

By PHILIP HAMBURGER

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Neil Gorsuch on Capitol Hill in February. Credit Gabriella Demczuk for The New York Times

A major point of contention facing Judge Neil M. Gorsuch in his Senate confirmation hearings this week is likely to be his view on a landmark 1984 Supreme Court decision concerning rule-making by federal agencies. This may seem like a dispute about administrative power, but more basically, it is about civil liberties.

The case, Chevron U.S.A. v. Natural Resources Defense Council, involved the Environmental Protection Agency’s authority to issue a rule under the Clean Air Act. Congress can expressly authorize agencies to make rules on one topic or another under current Supreme Court doctrine. Yet even when Congress does not expressly authorize rule making, agencies often make rules to clarify ambiguities or silences in laws in order to enforce them. They do this by interpreting the language used by Congress.

In such circumstances, according to Chevron, judges must defer to an agency’s interpretation, at least if it is within the range of permissible interpretations. In that way, agencies can make binding rules — essentially, can make law — on the theory that they are merely interpreting statutes, and under Chevron, judges generally cannot second-guess agency interpretations. In the case itself, the court found the E.P.A.’s interpretation of the law reasonable and upheld the rule.

The constitutional questions about Chevron focused for decades on the problem of separation of powers. But the debate has turned to deeper concerns about judicial independence and bias.

Judges have a duty to exercise their own independent judgment. Some academics and judges, including Justice Clarence Thomas and Judge Gorsuch, have therefore worried that Chevron requires judges to give up their independence in interpreting the law. As Judge Gorsuch explained while on the United States Court of Appeals for the 10th Circuit, courts have a “duty to exercise their independent judgment.”

Long ago, in Marbury v. Madison, Chief Justice John Marshall declared: “It is emphatically the province and duty of the judicial department to say what the law is. Those who apply the rule to particular cases, must of necessity expound and interpret that rule.” Judges cannot give up making their own judgments about statutes, as required by Chevron, without sacrificing their very duty as judges.

Even worse, Chevron establishes judicial bias. Judge Gorsuch has been silent on this problem. But where the government is a party to a case, Chevron requires judges to defer to the agency’s interpretation. This amounts to a precommitment to the government’s legal position. Chevron, in other words, forces judges to engage in systematic bias favoring one party — the most powerful of parties — in violation of the Fifth Amendment’s due process of law. Chevron deference is thus Chevron bias.

Of course, judges regularly defer to precedent, but that is deference to the judgment of another judge. It is quite another thing, and clearly unconstitutional, for them to defer to the judgment of one of the parties — indeed, to favor its legal position whenever it comes into court.

Chevron therefore cannot be reduced merely to the separation-of-powers concern — important as that is. Chevron bias also raises serious civil liberties issues, because each party has a constitutional right to an impartial judicial proceeding.

Although the Supreme Court has carefully avoided any resolution of the civil liberties questions, it has already been quietly backing away from Chevron. The only difference with Judge Gorsuch on the court is that, in light of the views he has expressed on the 10th Circuit, he would probably reject Chevron openly.

As might be expected, there are countervailing legal arguments in favor of Chevron. One is that, without Chevron, judges will have to attribute meaning to highly ambiguous statutes and will therefore have to make law — indeed, will have to make law on technical matters in which they lack competence. This is a reasonable concern, but entirely misplaced.

Judges should not make heroic efforts to find statutory meaning. Where a statute is ambiguous or silent on an issue, judges can use familiar interpretive techniques to discern its meaning. If they still cannot find its meaning, they should just stop. This is not to say they must hold such a statute unconstitutionally vague, but rather that they should avoid making law and therefore should recognize that the statute has nothing more to say. Once judges conclude as much, Congress can easily correct the ambiguity.

Attempts to rally around Chevron respond to fears for recent agency policies that rely on Chevron, such as the Clean Power Plan. Many agencies have used (and sometimes abused) Chevron to make expansive rules without express or even tacit statutory authorization, and such rules will be at risk. But these rules will be at risk long before Chevron hits the dust, because any new president can use Chevron to alter rules imposed by predecessors. The fate of such rules does not depend on the fate of Chevron.

Might a renunciation of Chevron hobble the administrative state? The administrative state thrived long before 1984, and for better or worse, it will not disappear with Chevron. The only structural change will be that agencies will not be able to act without express and clear congressional authorization for their rules. And if they cannot get such authorization, perhaps they ought not be making rules.

Chevron is a widely cited precedent, and precedents should never be casually overturned. But Chevron deprives Americans of their right to have judges who exercise their own independent judgment without systematic bias. Chevron is thus grossly unconstitutional — not least, a persistent denial of the due process of law.

Judges have a duty to reject Chevron with candor and clarity. Judge Gorsuch has done this. Rather than be berated for it, he should be congratulated.

Philip Hamburger is a professor at Columbia Law School and the author, most recently, of “Chevron Bias.”

A version of this op-ed appears in print on March 20, 2017, on Page A23 of the New York edition with the headline: Gorsuch and the Administrative State

“Here’s the deal, either we believe in the limited liability company or we don’t…

…Tesla’s business model ten years out is more proven today than years ago (they almost failed during the financial crisis), but they also have a LOT more competition today and still aren’t making money, still investing in new and speculative ventures, and constantly having to go back to investors for more capital, to cover their serious cash flow shortages. One mistake or the capital markets closing for firms like this could mean doom for them. Here’s the point, do we want companies to take risks, risks that could cause them to fail or not? You know, there is a lot of risk associated with “doing nothing” too, think Kodak, Xerox, Yahoo, so many more than the Googles, Facebooks, Amazons, and maybe Tesla…..With that said, most entrepreneurs and investors would not take those risks, if they knew they were going to be personally sued and held liable for losses arising from their business judgements, that in hindsight, don’t work out. That is the purpose of the Limited Liability corporation and The Business Judgment Rule, yet in California, federal courts have ruled that corporate officers are not protected by The Business Judgment Rule….that they could be sued for Ordinary Negligence, a very low bar and highly subjective. Think about it, isn’t running a business for ten years, that is reliant on continued funding from the capital markets, because it hasn’t achieved profitability/positive cash flow….negligent? And further, buying other companies (like your relative’s failing solar firm) and investing in new technologies, as opposed to finishing your small car and achieving positive cash flow asap….isn’t that negligent? Just saying….either we want people to take risks with Other People’s Money or we don’t? I think we do, but the California legal system sure doesn’t. How can any good lawyer, for a company like Tesla, allow their officers to place themselves and their families at risk, by being headquartered in California, where the federal courts have ruled they are not protected by The Business Judgment Rule?”, Mike Perry, former Chairman and CEO, IndyMac Bank

John D. Stoll, March 15, 2017, The Wall Street Journal

Tech

Tesla Raises Additional Funds for Model 3 Debut

Tesla is offering $250 million in common stock and $750 million in convertible notes due in 2022

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Tesla Inc. shares rose 2.3% in after-hours trading. PHOTO: NICOLAS LAMBERT/ZUMA PRESS

By John D. Stoll

Tesla Inc. said it is on track to launch a more affordable car this year, but it needs to raise $1 billion to make sure it happens.

The Silicon Valley electric-vehicle maker said Wednesday it is offering $250 million in common stock and $750 million in convertible notes to strengthen a fragile balance sheet amid a risky ramp-up of Model 3 production. Billed as a cheaper offering by a company known for pricey super cars, the Model 3 is intended to sell in much higher volumes than the current models and compete with more mainstream brands.

Tesla shares gained 2.3% to $261.50 in after-hours trading. Analysts had expected Tesla to seek as much as $2.5 billion in the near-term, citing its inflated market value (which is near Ford Motor Co.’s market capitalization).

Tesla is a perennial money loser, however, notching two profitable quarters since going public early in the decade. Deeply indebted and planning to increase production capacity, the company needs a cushion to move ahead in the capital-intensive auto industry.

Tesla has more than $2 billion due in 2018—a year during which Tesla aims to sell significantly more vehicles than last year. It also plans to continue investing heavily in overhead and product creation in coming years.

The company plans to make 500,000 cars a year by the end of 2018 and 1 million vehicles in 2020. It is a long way off from that mark. Last year, Tesla produced nearly 84,000 vehicles.

Chief Executive Officer Elon Musk signaled the need for more financing last month, a move his company has made several times in recent years even as it has consistently notched year-over-year quarterly revenue increases. Already Tesla’s largest shareholder, Mr. Musk intends to buy about 10% of the common stock Tesla will issue in the public offering.

Mr. Musk has laid out plans for more electric models, including heavier-use products, such as a bus-like vehicle, and a pickup truck. With last year’s acquisition of SolarCity Corp., he is laying the groundwork to turn Tesla into a sustainable energy company offering solar power, batteries and electric vehicles.

The Model 3 project has been in the works for several years. The car is expected to debut with a price tag under $40,000 and achieve far more than 200 miles on a charge, and will compete most directly with General Motors Co.’s Chevrolet Bolt.

Tesla’s current products — the Model X and Model S — challenge Porsche AG, BMW AG and other premium nameplates.

Appeared in the Mar. 16, 2017, print edition as ‘Tesla Cash Call: $1 Billion.’

“NY’s Sen. Schumer’s 2008 public attack on IndyMac Bank and its management was also unwarranted and a fraud.”, Mike Perry, former Chairman and CEO IndyMac Bank

Chuck Schumer Knows His Attack on Neil Gorsuch Is a Fraud

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Gorsuch on Capitol HIll, February 2, 2017. (Reuters photo: Yuri Gripas)

Supreme Court justices aren’t politicians or legislators — they’re to consider the law as it stands, not angle for their preferred policy outcomes.

Charles E. Schumer, besides being minority leader of the U.S. Senate, is a graduate of Harvard Law School, Class of 1974, so it seems reasonable to think that, between the two, he has at least glanced at the oath required of Supreme Court justices:

I, _________, do solemnly swear (or affirm) that I will administer justice without respect to persons, and do equal right to the poor and to the rich, and that I will faithfully and impartially discharge and perform all the duties incumbent upon me as _________ under the Constitution and laws of the United States. So help me God.

Then again, perhaps not. On Wednesday morning, Senator Schumer and his Democratic colleagues held a press conference on Capitol Hill, featuring — in the words of a press release announcing the event — “people harmed by Judge Gorsuch decisions,” who “raise serious concerns about [Gorsuch’s] record of siding against working Americans, for the powerful few.”

This is, as Senator Schumer surely recognizes, a stupid way to think about constitutional law.

Of course, it happens to be the way many people — not least Senate Democrats and their confreres in the media and elsewhere — think about constitutional law these days. To accompany Schumer’s presser, the New York Times published an exposé touting Gorsuch’s “web of ties to [a] secretive billionaire.” The “secretive” billionaire in question is oil-and-gas magnate Philip F. Anschutz, who is so “secretive” that he owns The Weekly Standard, financed the Walden Pictures film The Chronicles of Narnia: The Lion, the Witch and the Wardrobe, helped to found Major League Soccer, and is the namesake of the Anschutz Library and Anschutz Sports Pavilion at the University of Kansas. Gorsuch’s nefarious tie to Anschutz is that, while working for a prominent D.C.-area law firm, Gorsuch, who is from Colorado, helped represent the Anschutz Company, which is headquartered in Denver.

Nevertheless, Democrats have chosen their line: In Schumer’s words, Gorsuch has repeatedly sided “with the powerful against the powerless.”

Or maybe he has simply sided with . . . the law. Ironically, the three cases Senate Democrats highlighted on Wednesday show precisely that.

Patricia Caplinger brought a lawsuit against medical-device company Medtronic in 2012, alleging that the company violated the Medical Device Amendments (MDA) to the Federal Food, Drug, and Cosmetics Act. Caplinger suffered complications after having a Medtronic bone-growth product surgically implanted, and she accused Medtronic of concealing pertinent medical information. Gorsuch, writing for the 2–1 majority, sided with the district court against Caplinger. The final paragraph of the decision read:

Not everyone may agree with how Congress [by means of the MDA] balanced the competing interests it faced in this sensitive and difficult area. We can surely imagine a different statute embodying a different judgment. But strike a balance Congress had to and did, and it is not for this court to revise it by beating a new path around preemption nowhere authorized in the text of the statute and nowhere recognized in any of the Supreme Court’s many forays into this field.

In other words, Gorsuch applied the law as written to the facts of the case at hand.

He took the same approach in the case of the late Grace Hwang. In 2009, Hwang, a professor at Kansas State University, was diagnosed with cancer. She received a six-month paid leave of absence, in accordance with the school’s policy. Toward the end of that period, in early 2010, she applied for the university’s long-term disability benefits, which required her to resign. After trying to negotiate a different arrangement, Hwang accepted, but she subsequently sued the university for violating the 1973 Rehabilitation Act, which prohibits recipients of federal funds from discriminating on the basis of disability. Gorsuch, writing for the 3–0 majority and again affirming the lower court, explained:

Ms. Hwang’s is a terrible problem, one in no way of her own making, but it’s a problem other forms of social security aim to address. The Rehabilitation Act seeks to prevent employers from callously denying reasonable accommodations that permit otherwise qualified disabled persons to work — not to turn employers into safety net providers for those who cannot work.

By Ms. Hwang’s own admission, he notes, she was incapable of working. Continued Gorsuch:

It perhaps goes without saying that an employee who isn’t capable of working for so long isn’t an employee capable of performing a job’s essential functions — and that requiring an employer to keep a job open for so long doesn’t qualify as a reasonable accommodation. After all, reasonable accommodations — typically things like adding ramps or allowing more flexible working hours — are all about enabling employees to work, not to not work.

This is not “heartless.” (Hwang’s family’s description of Gorsuch in an op-ed published in the San Francisco Chronicle on Wednesday; her daughter, Katherine, was present for Schumer’s press conference.) It’s an application of the law to the facts of the case. It’s worth noting that the two other judges on the Tenth Circuit agreed that Hwang had insufficient legal grounds for her complaint.

Finally, there is Alphonse Maddin. Maddin was fired by TransAm Trucking in January 2009 for abandoning the trailer of his truck; when the trailer’s brakes froze in subzero temperatures, and after he had waited several hours for assistance, he unhitched his truck and drove away, leaving the trailer behind. In fact, the Tenth Circuit majority decided for Maddin. He was apparently “harmed” by Gorsuch’s dissent in the case.

Writing against the two-judge majority, Gorsuch demonstrated that his fellow judges and the Department of Labor (which backed Maddin’s claim) had misconstrued the statute — the Surface Transportation Assistance Act — that Maddin claimed TransAm Trucking had violated:

It might be fair to ask whether TransAm’s decision was a wise or kind one. But it’s not our job to answer questions like that. Our only task is to decide whether the decision was an illegal one. . . . The trucker was fired only after he declined the statutorily protected option (refuse to operate) and chose instead to operate his vehicle in a manner he thought wise but his employer did not. And there’s simply no law anyone has pointed us to giving employees the right to operate their vehicles in ways their employers forbid. Maybe the Department would like such a law, maybe someday Congress will adorn our federal statute books with such a law. But it isn’t there yet. And it isn’t our job to write one — or to allow the Department to write one in Congress’s place.

Again, there is no hostility to Maddin here. (In fact, as Ed Whelan suggests, Gorsuch’s presentation of the case’s facts is more sympathetic to Maddin than the majority’s.) There is a dispassionate application of existing law — and a steadfast refusal to go beyond the law and conjure up an accommodation, even for someone who was in a tough spot. Democrats are happy to blur the line between Supreme Court justices and politicians, when it’s to their advantage.

Given the above, it’s worth asking: Do Senate Democrats want a Supreme Court justice who will apply the law as written? Or do they want a justice who will manufacture outcomes to benefit “sympathetic” petitioners?

Alas, the answer is clear. As they have done now for a number of years, Democrats are happy to blur the line between Supreme Court justices and politicians, when it’s to their advantage. When Senator Schumer uses cases like the above to suggest that Gorsuch will promote a “pro-corporate agenda,” he is not only misrepresenting Gorsuch’s record; he is misrepresenting the role of judges. Legislators and governors and presidents have agendas. Supreme Court justices have the Constitution and the statutes passed by Congress, which they are to consider impartially, without fretting about the “negative real-life implications for working Americans.” Senator Schumer doesn’t want a judge who will read and apply the law dispassionately. He wants an activist in a robe.

Neil Gorsuch is not that. Gorsuch is a judge who has time and again demonstrated his fidelity to the letter of the law, and his lack of concern with whether the outcome of his ruling is “conservative” or “liberal.” This is no small part of the reason that not one of the 200-plus opinions he has authored during his decade on the Tenth Circuit Court of Appeals has been reversed by the Supreme Court; and why, since his nomination to the High Court, legal analysts on both sides of the aisle have unreservedly praised him; and why even the famously left-leaning American Bar Association has declared Gorsuch “well qualified” (its highest rating) to sit on the Court.

Senate Democrats, despite their braying, are well aware that the “victims” paraded in front of the cameras on Wednesday are not the result of Judge Gorsuch’s malice, but of his consistent application of the law.

Gorsuch doesn’t side “with corporations” or “against corporations.” As one would want from a Supreme Court justice, he sides with the law. It says a great deal that Democrats are alarmed by that.

— Ian Tuttle is the Thomas L. Rhodes Fellow at the National Review Institute.