In the hysteria after the Sept. 11 attacks, US Sen. John McCain noted, 245 pork barrel items were larded onto the 2002 defense appropriations bill. They included items of such dubious military value as a new gym in Texas, a harbor cleanup in California, and raising a Civil War-era ironclad in Virginia. But the biggest was a $20 billion Air Force plan to lease 100 refueling tankers from the Boeing Aircraft Co. The planes would cost $150 million apiece. The lease would run for 10 years. Then the Air Force would pay $30 million to reconfigure each of the 767s for commercial use and give the planes back to Boeing. In his 15 years in the Senate, McCain said, he had never seen such audacity, according to US News. "We are going to spend $20 billion plus over a 10-year period and 10 years from now are going to have nothing to show for it," McCain said, calling it war profiteering. But Mitchell Daniels, the director of the Office of Management and Budget, has questioned the lease and the final agreement between Boeing and the Air Force has not been signed. McCain says he'll try to put a measure in the new defense authorization bill that would force the money for the lease to come from the procurement budget, not from maintenance funds.
CORPORATIONS MUST TELL TRUTH. The California Supreme Court has ruled that corporations may be liable under the state's consumer-protection laws for misleading advertising or public statements about their products or operations. In a ruling hailed by corporate-accountability and labor activists, the court ordered a trial court to proceed with a case brought by Marc Kasky, an activist who charged that Nike, Inc., made false statements about conditions in Asian factories used to produce its shoes and apparel in order to counter criticism that the company was using "sweatshop" labor, OneWorld.net reported.
FREE TRADE STANDOFF. The "fast track" trade promotion was heading to the Senate floor at press time. Republicans have agreed to Democratic efforts to include "trade adjustment assistance" including health subsidies for workers who lose their jobs to import competition or plant relocations. But The American Prospect noted that Sen John Kerry, D-Mass., has also crafted a modest amendment that would limit provisions such as NAFTA's Chapter 11. That provision allows corporations to sue governments, in secret World Trade Organization tribunals, for "regulatory takings" such as environmental or labor regulations. Kerry's efforts have yet to attract any Republican cosponsors --or the key support of Montana Democrat Max Baucus, chairman of the Senate Finance Committee, the Prospect noted. If the bill is amended in the Senate, it must go back to the House, where it passed by only one vote in December. Call your senators and reps via the Capitol switchboard at 202-224-3121.
Meanwhile, the European Union is demanding that foreign companies be allowed to compete with the US Postal Service as part of World Trade Organization talks that began last year. The Washington Times reported April 26 that Europe also wants access to American markets for municipal water and waste services. It also will call for foreign companies to be given access to Small Business Administration loans. The European demands, which will be formally presented to the US government by the end of June, mark the opening salvo in WTO negotiations on trade in services, an area that includes industries from finance to telecommunications to energy. The talks began in earnest when the organization agreed at a November meeting in Doha, Qatar, to make a new attempt to remove barriers to international commerce.
SECOND THOUGHTS ON TERROR POWERS. Democrats are starting to take a critical look at the secret court subpoenas, examinations of bookstore records, revised immigration policies and other uses of sweeping new powers authorized in the USA PATRIOT Act. Sen. Russ Feingold, D-Wis., the lone senator who voted against the measure last fall, has been joined by other Democratic senators, including Judiciary Committee Chairman Patrick Leahy (Vt.), Richard Durbin (Ill.) and Maria Cantwell (Wash.), according to The Hill. Particularly troubling to Feingold is a provision that gives the FBI new powers to subpoena business records, even if they are not directly connected to a suspect in such an investigation. It has been used to demand of bookstores and libraries the purchase or lending records of their patrons. Leahy's concerns also include broader administration plans to combat terrorism, such as an executive order allowing noncitizens to be tried by military tribunals and the lack of information released on detainees in the Sept. 11 investigation.
POOR PRICED OUT OF COLLEGE. Rising college tuition costs have increasingly priced lower-income Americans out of colleges, and state budget crises are making matters even worse. A report by the nonprofit National Center for Public Policy and Higher Education (highereducation.org), said "only the wealthiest families have seen their incomes keep pace with increases in tuition. The lowest-income families have lost the most ground, and this is a major factor in their lower rates of college attendance." Borrowing to pay for college increased among students from families at all income levels during the 1990s. For seniors from low-income families attending public four-year schools, debt loads averaged $12,888 in the 1999-2000 school year, up 69% from 10 years earlier, even after adjusting for inflation. As the report came out, the Bush administration proposed to squeeze $1.3 billion from a federal student loan program by forcing students who combine federal education loans to accept variable rates instead of locking in their loans at a low, fixed rate. White House budget director Mitchell E. Daniels Jr. proposed the loan cutbacks as a way to deal with more than $100 billion in budget shortfalls brought on by the recession, tax breaks for the wealthy and costs of the war on terrorism. The White House retracted the idea of student loan cutbacks in the face of intense Democratic criticism --but it will still be looking for domestic programs to cut.
STATEHOUSE LOBBIES PACKED. The Center for Public Integrity (publicintegrity.org) reported that lobbyists spent $570 million in 2000 to influence legislators in 34 states, a rise of 91% from 1995, when fewer states reported such spending. Sixteen states still do not tabulate lobbyist spending, so the national total would be much higher. The study found nearly 37,000 businesses, associations and interest groups are registered lobbyists in the 50 states, a ratio of about five lobbyists to every state legislator. The largest lobbying groups in nearly every capital city were the ones paid by the industries that were most closely regulated: insurance, education, local governments, and health care. California lobbyists had by far the largest operation, spending $180 million in 2000, compared with $66 million spent in New York, the state with the next highest amount.
CHOMSKY'S SURPRISE SELLER. A 125-page pocket-size paperback of Noam Chomsky's views on the Sept. 11 attacks is a surprise bestseller, the New York Times reported May 4. 9-11, as the book is titled, published by Seven Stories Press (www.sevenstories.com), is mainly a compilation of transcripts of interviews Chomsky gave after the attacks. "People said it would have no success whatsoever," Daniel Simon, the publisher of Seven Stories, told the Times, "because most Americans were lock-step behind the war." But more than 115,000 copies have been shipped to stores. The book sells particularly well at independent bookstores, although Barnes & Noble has sold about 14,000 copies. Despite little notice (praise in the San Francisco Chronicle and a pan in the Philadelphia Inquirer), it has made the best-seller lists of The Washington Post, The Los Angeles Times, The Boston Globe, The Village Voice and Amazon.com.
LAWSUIT CLAIMS PREDATORY LENDING. Three victims of predatory lending filed a national class-action suit in the Circuit Court of Cook County, Ill., accusing Household International and its subsidiaries, Household Finance Corporation and Beneficial Corporation, of a wide range of fraud and misrepresentation. The suit accuses Household of deliberately misleading borrowers about the terms and conditions of their loans, including high rates and fees, principal amounts which exceed the actual value of their homes, and prepayment penalties that effectively trap borrowers in overpriced loans. The class for the suit includes all borrowers induced to enter into secured loans to consolidate existing debt. It asks for rescission of the loans --restoring interest paid and fees to the borrowers --as well as for actual and punitive damages. Household made more than $45 billion dollars worth of secured loans in the past three years. On Feb. 6, ACORN and two victims of predatory lending filed a similar class-action suit covering borrowers only in the State of California. On Jan. 10, Household agreed to pay $12 million to settle California regulators' allegations that Household deliberately overcharged tens of thousands of customers. On April 23, the 7th U.S. Circuit Court of Appeals in Chicago reversed a $25 million settlement of a class-action suit against Household and H&R Block. The decision removed a legal shield that had protected Household and Block from allegations they illegally gouged customers by providing "refund anticipation loans" at interest rates frequently exceeding 100%. Household and Block could face damages of up to $2 billion in Texas alone, the appeals court said. For more information see www.acorn.org or call ACORN toll free at 1-877-692-0233. Also see "Legal Fleecing of Poor Minorities" by Michael May, 5/15/02 TPP.
RETIREMENT BUST. Despite the recent unprecedented stock market boom and rapid proliferation of 401(k) retirement plans, typical Americans now facing retirement will have to tighten their belts harder than previous retirees. More than 40% of households headed by someone between the ages of 47 and 64 will not be able to replace even half of their pre-retirement income once they stop working. Nearly 20% will have retirement income below the poverty line. "Retirement Insecurity," by New York University economist and wealth expert Edward N. Wolff, published today by the Economic Policy Institute (epinet.org), finds that in 1998, every group of near-retirees except those at the very top lost ground compared with their counterparts in 1983. Sen. Jon Corzine, D-N.J., said he study shows that America's seniors cannot afford the deep cuts in guaranteed Social Security benefits that President Bush's Social Security commission has proposed.
OPPOSITION TO CORPORATE WELFARE GROWS. An amendment to restrict Export-Import Bank subsidies to companies that lay off American workers instead of foreigners received 135 votes, including a majority of Democrats, US Rep. Bernie Sanders, I-Vt., noted. Sanders, ranking member of the International Monetary Policy and Trade Subcommittee, said opposition is growing to the policies of the Export-Import Bank and an increasing number of Congress members want to see fundamental changes in the way that agency is run. "The American people are sick and tired of the largest and most profitable corporations in this country getting billions in corporate welfare while they lay off millions of American workers and move their jobs to China, Vietnam and other poor countries where workers are paid as little as 20 cents an hour," Sanders said. He noted that General Electric received over $2.5 billion in direct loans and loan guarantees from the Ex-Im Bank while it reduced its US workforce from 243,000 to 150,000 from 1985-1995, with the expressed goal of moving the jobs to Third World countries. General Motors received over $500 million in direct loans and loan guarantees from the Ex-Im Bank while it shrunk its US workforce from 559,000 to 314,000. And Motorola received almost $500 million in direct loans and loan subsidies from the Ex-Im Bank, while its workforce has been reduced to only 56% American workers. See bernie.house.gov or phone (202) 225-4115
MICHIGAN SEALS SEARCH WARRANTS. Police in Michigan were given the power to search homes without telling occupants why under two laws, which took effect April 20 as part of anti-terror efforts and shield from public scrutiny the reasons for police searches, according to the Oakland, Mich., Press. Defense lawyers and civil libertarians are outraged at the laws, which make search warrants and supporting documents such as affidavits non-public records. Under previous laws (still in force in federal courts), the records were public, unless a judge ordered them sealed for a specific reason. The Fourth Amendment to the US Constitution requires "probable cause" to issue a warrant and notes they must be written "particularly describing the place to be searched and the persons or things to be seized."
AD BAN CHALLENGED. The AFL-CIO sued in federal court April 22 challenging three provisions of the new campaign finance law signed into law in March, including the constitutionality of banning unions from broadcasting ads mentioning candidates or incumbents within 60 days of a general election or 30 days of a primary. It also challenges the new law's "coordination" provision and its requirement that unions make advance disclosures of intentions to broadcast a communication that would refer to a candidate or issue. "The AFL-CIO strongly supports meaningful campaign finance reform, including banning or limiting soft money at the national party level, as well as other key parts of the new statute. But this law also unfairly and severely interferes with the ability of unions to communicate with the public and to advance working family issues in Congress," said AFL-CIO President John Sweeney.