New Bill Could Give Bankrupt College Grads A Break

By Laurel Brishel Prichard -University of New Mexico/ Talk Radio News Service

Some in the Senate are looking to give Americans struggling with bankruptcy a break on their student loans.

Under the current law students are not able to discharge their debt accumulated from private student loans during bankruptcy proceedings. New legislation, the Private Student Loan Bankruptcy Fairness Act of 2010, would take away the favored status of private loan companies and allow for the past due amounts to be forgiven, just like debt from credit cards.

Members of the Senate Judiciary Committee, who are looking into the issue, heard testimony Thursday from Valisha Cooks, a Los Angeles resident burdened by student loan payments.

“I don’t really have very many options,” said Cooks, who filed bankruptcy, due in part, she explained, to her large loan payments. “I continue to pay my loan, even though they are in default. I just can’t afford to pay what they are asking me to pay.”

The Fairness Act would make all loans, government or private, dischargeable during bankruptcy.

GOP Doesn’t Mind Being ‘Party Of No’ On Spending

With Democrats in the Senate getting set to put forth a jobs bill, perhaps as early as Monday, their counterparts across the aisle are saying ‘no’ to more spending.

“We have a situation now that’s just too serious to continue to handle that way,” said Sen. Jim DeMint (R-S.C.) on Thursday. “It’s not an exaggeration to say our country is on the edge of a financial cliff.”

DeMint and fellow GOP Sens. John McCain (R-Ariz.), Lindsey Graham (R-S.C.) and George LeMieux (R-Fla.) unveiled their party’s latest attempt to restore fiscal responsibility to Washington, calling on Congress to support a one-year moratorium on earmarks along with a Constitutional Amendment to balance the federal budget.

“What we’re doing here today, is to try and challenge everyone in the Senate -- Republican and Democrat -- to join us in those steps that we can take...to address our growing deficit,” said DeMint.

“Everything is gonna get cut...it’s gonna be painful, but I guarantee you that we can cut the agencies of government...by 20 percent even, maybe 30 percent,” added LeMieux.

McCain, a noted opponent of federal earmark spending, blasted President Barack Obama for supporting using unspent Troubled Assets Relief Program (TARP) funds to fuel a jobs bill which could total over $100 billion.

“The President says he’s gonna have a spending freeze next year, and in the very next breath proposes a hundred billion dollars in new spending called a ‘jobs bill.’ It’s out of control.”

The hard part now for the 11 cosponsors of the measures will be to actually practice what they preach. Graham, for example, has a known record of not being averse to requesting earmarks. As recently as 2009, he helped secure nearly 10 million dollars to fund construction of a fitness center inside Shaw Air Force Base in South Carolina.

Graham, however, said he’s willing to bite the proverbial bullet in the short-run.

“It would be tough for us all, but it’s the right thing for the future. So I don’t mind an earmark system in the future that’s transparent, that’s logical and fits within a balanced budget.”

Hoyer: Curtailing America’s Debt Is Not A Choice

By Jonathan Bronstein, Talk Radio News Service

House Majority Leader Steny Hoyer (D-Md.)

When financial giants Bear Stearns and AIG crashed, the American government came to their rescue to maintain stability of the economy. When “too big to fail” Freddie Mac and Fannie Mae did fail, the American government stepped in and prevented their demise.

However, “If a fiscal meltdown comes, there will be no one to bail out
America,” said House Majority Leader Steny Hoyer (D-Md.), adding that the U.S.’s lack of a responsible fiscal policy for the last 30 years has placed the nation in dire economic straits.

Hoyer spoke yesterday at the Bipartisan Policy Committee.

America’s 2009 budget is contending with a $1.7 trillion deficit, which will only inflate the national debt to $11 trillion. More than $3 trillion of that debt is held by foreign lenders, specifically China.

“Our debt has never been higher...(This) is our sad, debt-ridden fiscal state,” said Hoyer. As a result “hundreds of billions of dollars every year - hundreds of billions that could strengthen our national defense, or help young Americans go to college, or fund research for the next energy breakthrough - will instead go to interest payments, merely to keep us solvent.”

Hoyer stressed that Congress must take the lead and reform the nation’s economic policy in order to prevent such a devastating, demoralizing and dangerous event from ever occurring.

The first, and most important way to reshape America’s fiscal future is to reform the entitlement programs, such as Social Security Medicare and Medicaid.

“We will not bring our debt down if we do not reform entitlements,” Hoyer said, but cautioned that it will not be possible without bipartisan support. He cited Social Security reform in 1986, which was only possible because of a compromise between the Democratic Speaker of the House, Tip O’Neil, and President Ronald Reagan.

“The Most Dangerous Credit Card in the History of the World”

By Michael Ruhl, University of New Mexico – Talk Radio News Service

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House Minority Leader John Boehner (R-Ohio)
Photo by Michael Ruhl

House Minority Leader John Boehner (R-Ohio) called congressional voting cards “the most dangerous credit card in the history of the world”, because then enable Congress and the president to engage in reckless spending. This was not Boehner's first criticism of Obama, but his statement came on the 101st day of the Obama Administration, a time which Boehner has criticized as being pock marked with excessive borrowing, reckless spending and a massive growth in government.

Boehner said that Democrat’s “record on spending and debt is staggering, but our economy is growing weaker, and it’s not going to get any better by growing the size of the government here in Washington.”

Boehner believes that the Democratically controlled Congress has enabled and contributed to the recklessness, and thinks it is up to the Republicans to put a stop to it. Republicans must be “the party of better solutions” if they are going to stand up to the Democrats in Congress, Boehner said, adding that he hopes Democrats will be committed to a bipartisan policy approach..

Citing the elections of 2008, Boehner said “out brand has been tarnished”, but to help the party serve the American people, Republicans must stand up to the Obama Administration when disagreements arise, and to offer alternative solutions.

Leader Boehner applauded President Obama on his strategy towards Afghanistan and Iraq, but showed concern at Obama’s greater national security policy.

“The big question continues to be: what is the Administration’s overarching plan to fight terrorism? Judging from their recent decision to release 30 terrorist detainees with no plan on where to put them, it continues to beg the question,” referring to Obama’s closure of the Guantanamo Bay detention center without knowing where the detainees will be sent.

Credit card spending linked to addiction

By Kayleigh Harvey - Talk Radio News Service

Credit cards could be considered a type of addiction like drugs, the House Subcommittee on Commercial and Administrative Law heard today, when discussing “Are Credit Cards Bankrupting Americans?”

While the answer did not resound with a deafening yes, it seems that credit cards and the confusion surrounding the rules and regulations that go with credit cards definitely do not help with the growing number of bankruptcy cases.

Adam Levitin from Georgetown University Law Center said, “It’s possible to drastically simplify credit cards. Most of the of the complexity of credit cards is not to serve any particular consumer desire or need...instead credit cards are complicated for complications sake.”

Levitin added, “There is nothing particularly surprising about high credit card debt correlating with bankruptcy. People who are in bankruptcy have debt. What is important to note is that debt, dollar for dollar, credit card debt has a much higher correlation with bankruptcy than any other type of debt.”

Noting that he was not a psychological expert, Levitin stated that there was a connection between consumer addiction and consumer credit. He said, “It is like drug use in this sense. There is definitely an addictive quality to credit...there definitely are parallels between the way consumers use credit and what we see with addictive products.”

Angered at the current actions taken by credit card companies, who grant loans to people already in high debt, Congressman Bill Delahunt (D-Mass.) said, “Not only does it enhance if you will, the pain for the bankrupt, but it disadvantages other unsecured creditors and hurts the retailer, because they are receiving a diminished pro-rata share. If your interested about the retailer in America, if you’re interested in commerce in America, you’ve got to take and put this issue into this equation. It isn’t just about the credit card industry. It’s about business in America.”