Trump’s offensive against the Consumer Finance Protective Bureau (CFPB) is not really about libertarian small-government. Nor is it really aimed at cutting back excessive federal spending.  The agency’s cost– which is only $750 million per year- does not have a meaningful impact on the federal budget. The closing is mainly about large financial favors for Trump donors. – The agency dropped its case against Capital One, after accusing the bank of illegally cheating customers out of more than $2 billion in interest payments. – – It also dismissed a case against the student loan servicer Pennsylvania Higher Education Assistance Agency (PHEAA), accused…

Reform #1. Resolve or Dismiss all medical debt lawsuits initiated by hospitals or collection agencies Medical debt — unlike home mortgages, student loans, and auto loans — is almost never truly voluntary.  People who seek medical care are hurting; they come to the hospital on the worst days of their lives. It is immoral to squeeze them as though they just bought an overpriced wide-screen TV.   People who need health care are suffering. When someone is suffering, to compound their suffering by demanding payment feels immoral.  The presence of pain and chronic illness — and the threat of disability or…

Charity is a good thing, and there will always be a role for it. However — voluntary donations cannot make up for our stingy healthcare system. When GoFundMe contributions provide care for a sick child, that does not excuse our country’s lack of national health insurance or paid sick leave.   GoFundMe is currently bragging that it has raised over $30 billion — over its entire existence, for all kinds of needs… To which I answer….Big deal! This is less than 10% of our annual national out-of-pocket healthcare expenses. It is, at best, putting a band-aid on a gaping wound. Besides…

The idea for the Consumer Financial Protection Bureau (CFPB) originated in a paper that Elizabeth Warren wrote in 2007 while she was a law professor at Harvard.  She moved to Washington after Dodd-Frank passed, to help then-President Obama get CFPB up and running. She touted it as a tool to protect average people from banks behaving badly. Obama considered naming Warren to direct the agency, but it became clear that corporate players and Republicans on the Hill wouldn’t have it. They feared she’d be too zealous a leader.  Since 2010, the CFPB’s work has included:  The CFPB has had a tangible impact on…

Liberals often claim that the cure for crime is to expand social-welfare programs.  They say we must first address economic exploitation, male and white supremacy, and homophobia in order to reduce violent crime.  Other culprits for ‘mass incarceration’ include a biased legal system, early childhood mistreatment, and draconian drug enforcement.   However — in the 1960’s, Chinese immigrants had the lowest average incomes in California…about $4,000 a year. At that time, the total number of Chinese in state prisons was five. No one proposed that we “ramp up social spending”,  or “provide affordable housing” to the Chinese, in effect to keep…

Debt vultures are nothing new in America – especially in health care. Collection firms can buy medical debts for pennies on the dollar, and then they try aggressively to collect the full amount. However, this ugly business model also operates on an international scale. I refer to the ‘Vulture funds’  — who have spent decades honing a predatory playbook, designed to extract maximum profits out of struggling, debt-ridden countries. The vulture funds business model is based on….  Billionaire Paul Singer – a longtime patron of Supreme Court judge Samuel Alito — has made exorbitant profits this way.   Singer was the…

To appreciate this statement, one must first wade through the complexity of Medicare accounting. Medicare Part A (hospital insurance) is funded with a tax of 2.90% total on all payroll income, plus an extra .90% on income that exceeds $250,000. For the first thirty years of Medicare, the annual receipts from payroll taxes exceeded the benefits paid out. The government created a paper “trust fund” with these surpluses. This was good publicity for the stability of Medicare Part A. The surpluses were invested in Treasury bonds. The Medicare trust fund thus holds a combination of current receipts and previously purchased…

A little-known area of financial abuse involves “structured settlement” annuities.  A structured settlement is often used in compensation for injuries or accidents – i.e. car crashes, medical malpractice, and class-action lawsuits. The victim is set up to receive their money through periodic payments –this is the ‘structure’. For example, the recipient might get $2,000 a month to age 65, and $1,000 a month thereafter.  There is not a lump sum cash advance –which is a good thing. There are many stories of lump sums being dissipated all too fast, with huge resulting debts.  Most attorneys and judges advocate for structured…

Student loan forgiveness can be quite confusing.  Here is a brief overview: Back in 2020, the Biden administration announced a plan to forgive $10,000 per debtor, for virtually the entire student debtor population – about 44 million borrowers. (The amount would be $20,000 if a student had been poor enough originally to also receive a Pell Grant.)  A married couple with student debts could be earning $250,000 a year today – but they would still have received $10,000 apiece in loan forgiveness. This might harvest votes in wealthy suburbs, but it seemed excessive to Republican opponents. This plan relied on…

Readers may remember the controversial 2015 shooting of Walter Scott, a 50-year-old black man,  in South Carolina.  A policeman was convicted for murder in the case, after a video surfaced showing him shooting Scott from behind. But few people ask: “Why was Walter Scott running away?” The sad explanation: child support. Scott had been repeatedly sent to jail for failure to pay child support. By the time of his death, he owed $18,000, and there was a warrant out for his arrest.  He had ended up in a vicious cycle: he couldn’t pay child support because he couldn’t hold a job,…

2023 was overall a good year for student debtors, even with some legislative reversals. However, borrowers are still receiving phone calls, emails, letters, and/or texts offering them relief from their federal student loans, or warning them that student loan forgiveness programs would end soon.  Usually, the so-called student loan debt relief companies offering these types of services don’t offer any relief at all. Often they’re just fraudsters who are after your money. Here are some examples of the false claims made in these communications: Communications using this type of aggressive advertising to lure borrowers are NOT coming from the U.S. Department of…

If you are concerned about medical debt, you have to start with the hospitals. Of the six million Americans who owe more than $5,000 in medical debt, 72 percent attribute their debt to bills from acute care, such as a single hospital stay or treatment for an accident.  There is a movement to limit medical debt…..but  it is inconsistent across the states.  That’s no surprise. The American hospital system has always been an unwieldy combination of private funding, public funding, federal and state regulations, and charity. Medical debt is not inevitable, however. We Americans are too cheap to establish straightforward…

A Kaiser Foundation survey on 9-29-23 makes it clear– we are seeing a large increase in insurance claim denials.  When insurance companies deny claims, patients eventually pay the price. These bills can easily turn into medical debt, with troubling consequences; people take steps that put their health at further risk.    1 in 7 people with medical debt have even been denied medical care because of their debt.  The insurance companies themselves admit that 41 million in-network claims were declined during the 2021 plan year. Among the for-profit insurers who sell on Healthcare.gov,  17% of  patient’s claims were denied. According to Kaiser,…