Shark Week 2016 – We’re going to need a bigger boat!

It’s Shark Week! While ocean going sharks will be in the spotlight, it’s the predatory payday loan sharks that are the real danger in our neighborhoods.

This year, we’ve got a chance to build a lifeboat to keep our families out of harm’s way with new proposed rules from the Consumer Financial Protection Bureau. The only problem is that the boat is full of holes, and a leaky boat won’t keep the loan sharks at bay.

This Shark Week, demand the CFPB plug the leaks in their proposed rule.

The business model of payday and car title loan sharks is to keep people trapped in endless cycles of debt. These sharks rely on direct access to borrowers’ checking accounts and holding the title to your car to get paid first. That’s the definition of predatory. The CFPB rules must truly dismantle the debt trap by letting payday lenders make a loan only when they have made sure the borrower can afford to pay it back.

Right now the CFPB proposed rules don’t guarantee that. They need to hear from you. Tell the the CFPB to plug the holes in their proposed rule so our communities are safe from predatory payday loan sharks who put profits over people.

This #Sharkweek, let’s make sure we come out ahead of the loan sharks.

03 Car Title Loan Sharks

Stop Predatory Lending

On June 2, in Kansas City, MO the Consumer Financial Protection Bureau (CFPB) will finally release their proposed rules for the payday loan industry. We’ve been fighting for this day for years and are thrilled it’s arrived. But this isn’t the end of the fight. It’s another beginning.

Community and faith leaders from across the country will be moving to action on June 2, in Kansas City and at home, to make our voices heard. We need a strong rule that shuts down the payday debt trap once and for all and we’re going to fight to make sure we get it. Join us by making a comment to the CFPB in support of a strong rule!

The CFPB will be opening a public comment period when they release the rules and we’ll need everyone’s voice to be heard. Check back on June 2nd for ways that you can submit your own comment to the CFPB and connect with groups working on the ground to be sure that we have a rule that doesn’t let the loan sharks continue to prey on our communities.

Every day, payday and car title lenders drain $23,951,459 out of the pockets of hard-working Americans with predatory lending practices. That’s over $8.7 billion every year and that doesn’t include predatory installment lending or capture every loan. The Consumer Financial Protection Bureau (CFPB) started the process of rulemaking in March of 2015 – we can’t wait anymore. We need a strong rule that puts a stop to the debt trap now.

The Problem

From payday storefronts to car title lenders to online & installment lenders, predatory lenders take billions in fees every year by trapping customers in a desperate cycle of debt.

  • Payday loans average 300% APR or higher, and online payday loans average over 650% APR.
  • 94% of all borrowers take out another loan within a month and more than half take out a new loan the SAME DAY their old loan was due.
  • One in six borrowers lose their car on top of paying steep interest and fees on car title loans

Last year, NPA and our affiliates organized and got the big banks OUT of the business of ripping off their own customers through checking account payday loans. Now we are focused on cleaning up the rest of the industry to stop the worst of the abuses through an upcoming rule-making from the Consumer Financial Protection Bureau.

For the first time in history, Congress has given a federal agency the authority to uniformly regulate small-dollar consumer loans: the payday, installment and related loan industries that strip billions in wealth from our communities and trap our families and neighbors in endless debt. Created by the Dodd-Frank Wall Street Accountability Act, the Consumer Financial Protection Bureau (CFPB) was given the authority to regulate non-bank financial institutions, including the small dollar loan industry.

We are demanding that the CFPB issue rules that are both strong enough to end the debt trap and broad enough to cover all the industry.

Join us in calling for strong, common sense rules that level the playing field for responsible small dollar lenders and that will stop the stripping of wealth from our families and neighbors.

Want to learn more about the vicious payday loan sharks preying on our communities? Check out the Shark Week 2015 page from our partners at National People’s Action and the Preyday Lenders page from more info.

Free From Jail, Imprisoned by Debt

This opinion piece by Libero Della Piana was written for OtherWords and appeared in Truthout.

At 36, Marcus White has spent half of his life in prison. Today he’s no longer behind bars, but now he’s imprisoned by something else: debt.

When White was sentenced, he was saddled with $5,800 in criminal fines and fees. By the time he was released, he was stunned to learn that with interest, his debt had grown to $15,000 — and continues to grow even now.

That debt isn’t just a drag on White’s finances. It’s a drag on his right to vote.

White’s not alone. More than 50 years after the 24th Amendment made poll taxes unconstitutional in the United States, formerly incarcerated people in at least 30 states are still barred from voting because they’re unable to fully pay their court-related fines and fees.

“I have completely changed my life and have been given a fresh start,” White said recently at a conference in Washington D.C. “Voting wasn’t important to me before, but now I want to be a productive citizen in every way… I want a voice in the process.”

“I am accountable for everything I have done,” he said. “But the interest rate on my fines is crazy.”

New research by my organization, the Alliance for a Just Society, shows that millions of people — including an estimated 1.5 million African Americans — are blocked from voting because they can’t afford their criminal debt.

That debt starts at sentencing and can grow at interest rates of 12 percent or more while inmates serve their sentences. It continues to grow after they’re released and face the numerous barriers to finding work and housing.

Some states explicitly require that all court-imposed fees are paid before voting rights are restored. Others are more indirect, requiring the completion of probation or parole — with the payment of fees and fines a condition of completing parole. The laws vary, but the effects are the same.

On the other hand, former offenders with wealthier family or friends, or a savings account, are able to quickly regain their voting rights. The result is a two-tiered system that restores voting rights to an affluent elite and leaves the rest — the majority, in fact — without a vote.

The reality of racism in the United States and the criminalization of poverty means that black people and other people of color are more likely to be arrested, convicted, and locked up for longer than whites. Blacks are also less likely to regain their right to vote once they’re released.

That racial disparity bears a grim resemblance to the poll taxes imposed throughout the South after the Civil War, which were intended to keep newly freed black people from exercising their civil rights.

The problem has worsened since 2013, when the Supreme Court gutted the Voting Rights Act of 1965. Many states — including several in the old Confederacy — have since rushed to impose restrictive voter ID laws and other impediments to voting. But debt as a barrier to voting remains a little-known reality.

The clearest solution is to automatically restore voting rights to formerly incarcerated people, and to register everyone immediately after they complete their sentence. Alternately, lawmakers could repeal all criminal disenfranchisement. Short of that, states should simply remove the payment of court debts as a condition for voting.

Many of us take voting for granted, especially in a presidential election year.

Voting means having a say in the policies that affect your life and community. It’s an opportunity to elect those who will represent your values. Voting is actively participating in a better future.

Voting is hope. And the ability to pay should never be a requirement for that.

Libero Della Piana, leads racial justice and criminalization initiatives for the Alliance for a Just Society, where he is the digital director. AllianceForAJustSociety.org
Distributed by OtherWords.org

Colleges Squeezing Out Less Profitable Home State Students

A change in funding at state colleges and universities is starting to change who makes up the student body. In-state students, even with perfect grades and impressive lists of extra-curricular activities, are being passed over in favor of out-of-state students willing to pay three times the tuition.

A scathing report last month accused the California State University system of admitting too many out-of-state students, and reducing opportunities for California residents to attend college in their own state.

When students move into states and squeeze out local students looking for an affordable education, access to the middle class, and increased opportunities—all promises of a public university – are lost.

California isn’t alone.

As college costs and student debt increase, schools nationwide are looking farther and farther away to fill the student body with higher paying out-of-state students to help sustain operations.

When colleges look out of state to fund their education, they go against their mission as a public good. Tuition-dependent schools are in essence privatized, relying on students rather than public funding to provide an education.

In Oregon, the state legislature, following a national trend since the recession, decreased higher education funding by 33.5 percent between 2008 and 2015. It’s the sixth highest cut in the country. Per student, the state reduced spending 32 percent between 2002 and 2012.

Without funding from the state, schools now rely increasingly on tuition for their operating budgets. In 2001, Oregon’s schools received 47 percent of their funding from the state; today the state provides 19 percent. To make up the difference, schools have shifted their funding from 45 percent from tuition to 73 percent.

This year, the University of Oregon’s student body is 35 percent out-of-state students and 14 percent international students. The remaining 51 percent are Oregon residents, much lower than the average of 73 percent at Oregon’s other public universities.

It isn’t just that the University of Oregon is so much more appealing to more students outside of Oregon. The University of Oregon needs out-of-state students for its bottom line – out-of-state students pay three times the tuition as Oregonians.

Twenty percent of the student body is from California alone. The school hired two full time recruiters based in California to encourage students to come to University of Oregon and pay full tuition.

Having more Californians in Eugene is not a problem – the problem, as in California, is that fewer are able to attend college in their home state. Between 2005 and 2009, the share of less lucrative Oregonians making up the freshman classes at the University of Oregon dropped from 79 percent to 59 percent.

Oregon and California aren’t alone in this trend. Out-of-state students outnumber in-state students at the University of Alabama, the University of Michigan, and the University of Iowa.

When colleges look out of state to fund their education, they go against their mission as a public good. Tuition-dependent schools are in essence privatized, relying on students rather than public funding to provide an education.

Gerrymandered Out of a Voice and a Vote

As the election season picks up steam, the matter of voting rights is making its way back into the mainstream media. Voters need to have their voices, and their votes counted. However, many of the newest congressional districts have been drawn in a way that limits the voice and voting power of people of color, which has repercussions for our democracy beyond the violation of personal rights.

Gerrymandering is the deliberate manipulation of district lines in favor of one party or class. It’s partially to blame for our current political climate. Gerrymandering not only creates extreme polarization and weakens the votes of moderates and minorities, it also reinforces racial stereotyping and housing segregation. Politicians capitalize on this disparity by creating fewer districts with high concentrations of minorities to erode representative power of people of color at both the state and federal level.

In a high-stakes election year it’s especially critical to ensure our elections are equally representative and fair. Gerrymandering conflicts with these principals and creates systematic barriers that must be addressed and remedied.

As David Wasserman, a leading political analyst and editor observed, “In the process of quarantining Democrats, Republicans effectively purged millions of minority voters from their own districts, drawing themselves into safe, lily-white strongholds with an average Republican House district that is 75 percent white.”

While the 1965 Voting Rights Act mandates increased representation for people of color, those in power are using the law it to justify gerrymandering as the only way to maintain racial fairness and representation. The Courts have found this justification faulty.

In February, the U.S. Court of Appeals ruled that two districts in North Carolina are unconstitutional based on racial gerrymandering and must be redrawn for the November 2016 elections.

While North Carolina’s presidential primary still went forward in March , the congressional primary has been moved to June 7. The Supreme Court denied North Carolina’s request for a stay, effectively enforcing the lower court’s ruling to begin the process of redrawing the congressional map. The ruling illustrates the court’s likelihood of following previous decisions, such as those against Alabama and Virginia last year.

Those rulings confirmed that most of the districts in those states were blatantly racialized and violated section 5 of the Voting Rights Act – that districts cannot be based on “any predetermined or fixed demographic information.” These rulings were made when Justice Scalia still remained on the Court, and although his death has shifted the dynamics of the bench, it seems likely that the lower courts ruling will be upheld.

The effects of gerrymandering are visible and have long-term consequences for our country and the sanctity of our democratic process. Whether it is the gridlock in Congress, the extreme rhetoric from both sides of the aisle, or the lack of political power of people of color already in Congress, the effects are being felt with few options for recourse.

The current congressional map makes it difficult for Democrats to regain control of the House, as evidenced in 2012 when Democrats won 1.4 million more votes nationally, yet Republicans won 33 more seats in the House of Representatives.

And while all but three of the African-Americans in the House are Democrats, they are bound to stay part of the minority party with fewer high-ranking committee appointments because of their ‘safe’ districts and the tendency for party leaders to “dole out plum assignments and opportunities to carry legislation to members facing competitive elections” All of these are consequences of politicians’ clear conflict of interest when drawing their own district lines.

Potential tools to address this issue have been implemented in 23 states in varying degrees across the country. States have established three types of independent commissions. Thirteen states give their commission primary responsibility for drawing new districts, five have an advisory commission that assists the legislature, and five have a backup commission that will make the decision if the legislature is unable to agree.

This is a significant step in removing the conflict of interest that fuels gerrymandering. However, it is crucial to be aware of how the commissions are selected and designed to prevent the perpetuation of partisan politics that led us down this path in the first place.

Recent court cases have bolstered gerrymandering visibility and outrage, and set precedents for the future. Typically, redistricting occurs after the most recent U.S. Census, which is done every ten years. That means that 2020 will be the next big opportunity for legislators and citizens to stand up and fight for common sense districts that reflect the people who live there and represent the diversity of race, religion, ethnicity, and beliefs within our communities.

LeeAnn Hall: Supreme Court Verdict Assures Unions Can Continue to Help Workers

The Alliance for a Just Society released the following statement from Executive Director LeeAnn Hall in response to Tuesday’s 4-4 Supreme Court verdict in the Friedrichs v. California Teachers Association case. The decision lets stand a lower court ruling upholding public sector unions’ ability to collect “fair share” fees to cover the costs of collective bargaining:

“Today’s outcome is an important victory for teachers, public service workers, and the communities that benefit from the services they provide. Public service unions will be able  to continue helping workers come together in collective bargaining to win better pay, benefits, and work environments.

“This challenge to the long-standing precedent supporting fair share fees was sheer nonsense from the beginning. Brought by the rightwing legal shop Center for Individual Rights, the challenge created a bizarre scenario where people who benefit from the union’s bargaining wouldn’t have to pitch in their fair share to support it. It created a ‘free rider’ scenario that defies both basic logic and stated conservative principles.

“Public sector unions have won important gains toward gender and racial equity in the workplace and created avenues to the middle class for people who have been shut out and discriminated against, especially people of color. It’s important for this work to continue – thanks to today’s decision, it can.

“People coming together in their communities and in their unions to express their opinions is how we build a strong democracy that works for all of us.”

Alliance for a Just Society is a national organization that focuses on social, economic and racial justice issues.

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Debt-Trap Debbie Swimming With the Loan Sharks

Debt-Trap Debbie needs to stop shilling for predatory payday lenders who siphon $8 billion in fees and interest each year from those who can least afford it.

That was the message delivered this week to Florida Rep. Debbie Wasserman Schultz’s doorstep at the Democratic National Committee, which she chairs, by a hundred grassroots leaders from National People’s Action, Alliance for a Just Society, USAction, and allies.

Decrying the “Sharknado” of debt brought on by the loan shark industry, the leaders arrived with more than 13,000 signatures calling on Wasserman Schultz to stop accepting money from the payday lending industry and stop sponsoring legislation that prioritizes predatory lenders over everyday families.

debt speakerThe grassroots leaders found the doors to Wasserman Schultz’ office building closed to them – so they turned up the heat with chants reminding Wasserman Schultz that they were determined to beat back the shark attack.

While leaders waved signs reading “Sharknado 4, starring Debbie Wasserman Schultz, produced and directed by the payday loan industry,” speakers from throughout the country testified to the devastation they and their communities have suffered.

“Once you’re swept up into the tornado of debt one loan turns into another in a cycle that just doesn’t let up,” said Candice Byrd, a member of Illinois People’s Action who spoke at the event. “It has been a nightmare for my family and me. We need our elected officials to stand with us against these predators, not in their pockets.”

Wasserman Schultz is cozy with the predatory payday lenders, having taken $68,000 in campaign contributions from the industry over the last 10 years.

Aide from Deebies officeNow she’s co-sponsoring legislation that would gut the Consumer Financial Protection Bureau’s efforts to crack down on these debt predators – and she’s lobbying her colleagues in Congress to sign on as well.

The Los Angeles Times’ David Lazarus calls her bill (H.R. 4018) “a shameless effort by the payday-loan industry, acting through congressional proxies, to avoid federal rules that would require more responsible behavior. The only choice it offers consumers is the ability to keep taking out high-interest loans even if it’s clear they can’t make payments.”

That’s why the leaders chanted even louder as barricades were brought out, then prayed for families devastated by predatory payday lenders – and for Wasserman Schultz, who does the bidding for an industry that charges up to 390 percent in interest rates.

The voices of so many persistent leaders were too powerful to ignore. After at first resisting a meeting, a representative for Wasserman Schultz emerged from behind the doors to accept the petition and a letter to Wasserman Schultz.

The leaders who descended on the Wasserman’s Schultz’s office will continue the fight.

They are determined not only to stop legislation bought by the predatory debt industry but to also win strong rules from the Consumer Financial Protection Bureau. Joining with Stop the Debt Trap Campaign, they will push for a small-dollar credit system that meets the needs of families and communities, and helps build an economy that’s equitable for all.

Disenfranchised by Debt

Washington D.C. – Poverty isn’t supposed to be a barrier to voting in the United States, at least according to the Constitution.

Yet, more than 50 years after poll taxes were prohibited by the Voting Rights Act of 1965, people with criminal convictions in at least 30 states are still being barred from voting even after serving their sentence because they are too poor to pay their jail fines and fees.

Disenfranchised by Debt is a new report by the Alliance for a Just Society released today at the Debt Nation conference in Washington, D.C. The report analyzes how millions of people, especially people of color, are blocked from voting because they can’t afford their criminal debts. Meanwhile, former offenders with means are able to quickly regain their voting rights – creating a two-tiered system.

A history of racism in the United States and the growing criminalization of poverty means that African Americans particularly, are more likely to be arrested, convicted, to receive harsher penalties, and are then less likely to regain their right to vote.

“Ending criminal disenfranchisement would be the ideal way to prevent the loss of voting rights due to court debt,” said Libero Della Piana, national organizer and racial justice leader with the Alliance for a Just Society. “Poverty should never be a reason for withholding anyone’s right to vote.”

Some of the recommendations in the report include:

  • Limiting interest rates and fees attached to unpaid LFOs.
  • Ensuring that those with misdemeanor convictions have the right and ability to vote while incarcerated.
  • Automatically registering people with conviction records when they become eligible to vote.

LFO debts grow at every stage of the judicial process, including while in jail or prison. Costs can even include laundry expenses, or haircuts. These debts also accrue interest at rates as high as 12 percent – including while the person is incarcerated. Many prisoners leave jail thousands of dollars in debt, with few job opportunities.

“Legal Financial Obligations prevent ex-offenders from rebuilding a productive life,” said Allyson Fredericksen, senior policy analyst and author of the report. “Many of these issues can be ended by reducing fees and eliminating interest on debt while incarcerated. The ability to pay should never be a criteria for voting.”

Most formerly incarcerated people never regain their right to vote.

“Our research shows that while some states explicitly require the repayment of legal debt before voting rights are restored, many other states are more indirect, requiring the completion of probation or parole – with the payment of fees and fines a condition of completing parole,” said Linnea Lassiter, co-author of Disenfranchised by Debt.

In Maryland, voting rights have recently been restored to to 40,000 people statewide completing probation, and starting March 10 will be restored automatically upon their release from prison.

In Virginia, Gov. Terry McAuliffe is the only person able to restore voting rights to those with felony convictions, per Virginia’s constitution. He announced last year that “outstanding court costs and fees will no longer prohibit an individual from having his or her rights restored.”

This opens up the opportunity to vote to even more returning citizens, many of them African American.

Virginia Organizing leader Eunice Haigler of Fredericksburg, Va., gives workshops to help former felons regain their voting rights.

“I don’t know if a lot of people know how valuable it is to African Americans to be able to vote,” said Haigler. “Many African Americans don’t have a lot of hope, so to be able to vote and have a say in your community, to make it better, is a whole new world.”

Alliance for a Just Society is a national organization that focuses on social, economic and racial justice issues.

Tools to End the Prison to Poverty Pipeline

A prison sentence often doesn’t end on the day of release. For many people with conviction records, their sentence will continue for years to come with barriers to employment and housing.

Research in the report, “Jobs after Jail: Ending the prison to poverty pipeline,” by the Alliance for a Just Society, show that states have an average of 123 mandatory bans and restrictions preventing people with felony convictions from employment in certain occupations or from obtaining certain occupational or business licenses.

In Washington state alone, there are more than 90 career paths that are unavailable to someone who has a criminal record. Imagine having completed your sentence and being released into a community where you can’t be hired as a laborer, or work in transportation, business, education, social services, cosmetology, land development, public safety, or health care. For millions of people across the country, a past mistake can be a sentence to a lifetime of poverty.

According to the National Employment Law Center, “A 2011 study of the formerly incarcerated found that employment was the single most important influence on decreasing recidivism.” Other research shows that between 60 and 75 percent of people with a conviction record are jobless one year after release.

Beyond recidivism, though, finding work helps keep those with conviction records out of poverty. The Center for American Progress notes that a 2013 study found that that nation’s poverty rate would have been down 20 percent between 1980 and 2004 “if not for mass incarceration and the subsequent criminal records that haunt people for years after they have paid their debt to society.”

Recommendations in “Jobs after Jail” show that there are a variety of tools that can be used to ensure that a conviction record does not lead to a lifetime of poverty, including “Banning the Box” on employment applications, re-evaluating laws restricting employment in specific occupations, and making those with conviction records eligible for safety net services.

Additionally, a Certificate of Rehabilitation can help potential employers, licensing agencies, or even landlords assess the suitability, safety, and welfare of an applicant or renter. These certificates “can offer a presumption of rehabilitation … or at minimum an individual’s commitment to rehabilitation,” helping eliminate personal discrimination and providing additional evidence of rehabilitation and desire to reintegrate into the community.

So far, six states: Arizona, California, Illinois, Nevada, New Jersey, and New York use some form of these certificates, and Washington State is one of the latest states to propose adoption of a similar system.

In Washington, a Certificate of Restoration would give individuals with a conviction record the ability to obtain an occupational license. A person with a conviction record who meets certain qualifications can apply for a Certificate of Restoration. If their application is approved, they cannot have their application for an occupational license denied based on conviction record alone, provided they are otherwise qualified.

Washington’s proposed law is unique in that it prohibits the denial of occupational licenses based solely on a conviction record, but still allows employers and housing providers the discretion to assess individuals for hire or rent and select the individual of their choice.

While Certificates of Restoration alone will not ensure that all people with conviction records are able to find jobs and make ends meet, these certificates are one more tool to help people with conviction records find good-paying employment. A variety of tools are needed to help ensure that a conviction record is not a sentence to a lifetime of poverty.