Bob Casey on Budget & Economy Democratic Sr Senator (PA)

Need Fiscal Discipline to Lower Interest Rates

Budget deficit chokes investment, drives business to ruin

Require full disclosure about subprime mortgages.

Sen. DODD: Today we are facing a crisis in the mortgage markets on a scale that has not been seen since the Great Depression: over 2 million homeowners face foreclosure at a loss of over $160 billion in hard-earned home equity; over one out of every 5 subprime loans is currently delinquent. These high default rates have frozen the subprime and jumbo mortgage markets and infected the capital markets to the point where central banks around the world have had to inject liquidity into the system to avoid the crisis from spreading to other segments of the market.

One of the fundamental causes of this serious crisis is abusive and predatory subprime mortgage lending. The Homeownership Preservation and Protection Act of 2007 is designed to protect American homeowners from these practices, and prevent this disaster from happening again. The legislation will:

• realign the interests of the mortgage industry with borrowers to insure the availability of mortgage capital on fair terms both for the creation and sustainability of homeownership;
• establish new lending standards to ensure that loans are affordable and fair, and
• provide for adequate remedies to make sure the standards are met; and create a transparent set of rules for the mortgage industry so that capital can safely return to the market without bad lending practices driving out the good.

In the coming months, the housing crisis is going to get worse. We will need to continue to press lenders and servicers to provide real relief for homeowners threatened with foreclosure.

Reform mortgage rules to prevent foreclosure & bankruptcy.

• Foreclosure Prevention Act of 2008 - refinance mortgages originally financed through a qualified subprime loan.
• Makes FY2008 appropriations for emergency needs of states and local governments to redevelop abandoned and foreclosed homes; and the Neighborhood Reinvestment Corporation for foreclosure mitigation activities.
• Helping Families Save Their Homes in Bankruptcy Act of 2008 - Authorizes a bankruptcy plan for individuals with regular income to provide for payment of such claim for a period of up to 30 years. Creates a principal residence homestead exemption for debtors over 55 years of age.
• Mortgage Disclosure Improvement Act of 2008 - Amends the Truth in Lending Act to set forth additional disclosure requirements governing any extensions of credit (not only mortgages) secured by the dwelling of a consumer.

Ban abusive credit practices & enhance consumer disclosure.

Credit Card Accountability Responsibility and Disclosure Act of 2009 or the Credit CARD Act of 2009:
• Tile I: Amends the Truth in Lending Act to require advance notice of any increase in the annual percentage rate of interest (APR) pertaining to a credit card account under an open end consumer credit plan.
• Imposes a freeze on interest rate terms and fees on canceled cards.
• Sets limits on fees and interest charges, including a prohibition against penalties for on-time payments.
• Allows imposition of an over-the-limit fee only once during a billing cycle. Prohibits its imposition in a subsequent billing cycle.
• Requires fees for cardholder agreement violations and currency exchanges to be reasonable.
• Prohibits a creditor from furnishing information to a consumer reporting agency concerning a newly opened credit card account until the credit card has been used or activated by the consumer.
• Title II: Enhanced Consumer Disclosures: Requires the creditor to provide a toll-free telephone number at which the consumer may receive information about accessing credit counseling and debt management services.
• Revises requirements relating to late payment deadlines and penalties.
• Requires a periodic statement of account to disclose: (1) the date by which a payment must be postmarked, if paid by mail, in order to avoid the imposition of a late payment fee; and (2) any possible resulting increase in interest rates for late payments.
• Title III: Protection of Young Consumers: Prohibits issuance of a credit card on behalf of a consumer under age 21, unless the consumer has submitted a written application meeting specified requirements.

Voted YES on $900 billion COVID relief package.

NPR summary of HR133:

• $600 checks for every adult and child earning up to $75,000, and smaller checks if earning up to $99,000.
• Unemployment: extend enhanced benefits for jobless workers, $300 per week through March.
• Rental assistance: $25 billion to help pay rent; extends eviction moratorium until Jan. 31.
• SNAP assistance: $13 billion for the Supplemental Nutrition Assistance Program.
• PPP loans: $284 billion for Paycheck Protection Program loans, expanding eligibility to include nonprofits, news/TV/radio media, broadband access, and movie theaters & cultural institutions
• Child care centers: $10 billion to help providers safely reopen.
• $68 billion to distribute COVID-19 vaccines and tests at no cost.
• $45 billion in transportation-related assistance, including airlines and Amtrak.
• $82 billion in funding for schools and universities to assist with reopening
• $13 billion for the Coronavirus Food Assistance Program for growers and livestock producers.

Argument in opposition: Rep. Alex Mooney (R-WV-2) said after voting against H.R. 133: `Congress voted to spend another $2.3 trillion [$900 billion for COVID relief], which will grow our national debt to about $29 trillion. The federal government will again have to borrow money from nations like China. This massive debt is being passed on to our children and grandchildren. With multiple vaccines on the way thanks to President Trump and Operation Warp Speed, we do not need to pile on so much additional debt. Now is the time to safely reopen our schools and our economy. HR133 was another 5593-page bill put together behind closed doors and released moments prior to the vote.`

Legislative outcome: Passed House 327-85-18, Roll #250, on Dec. 21. 2020; Passed Senate 92-6-2, Roll #289, on Dec. 21; signed by President Trump on Dec 27 [after asking for an increase from $600 to $2,000 per person, which was introduced as a separate vote].

$1.9 trillion ARPA bill for COVID relief.

This bill provides additional relief to address the continued impact of COVID-19 on the economy, public health, state and local governments, individuals, and businesses:

• Supplemental Nutrition Assistance Program (SNAP, formerly known as the food stamp program);
• schools and institutions of higher education;
• child care and programs for older Americans and their families;
• COVID-19 vaccinations, testing, treatment, and prevention;
• emergency rental assistance, homeowner assistance, and other housing programs;
• payments to state and local governments for economic relief;
• small business assistance, including restaurants;
• and state capital projects that enable work, education, and health monitoring in response to COVID-19

Rep. Kevin McCarthy in OPPOSITION (3/11/21): The so-called American Rescue Plan imposed a $1.9 trillion new burden on American families. Despite being branded as `COVID relief,` only 9% of funds in this bill actually goes to defeating the virus, and almost half of the money, including more than 95% of the education funds, will not be spent until 2022 or later. After a year of struggle and sacrifice, students and parents get no answer to the vital question of when they can expect schools to reopen full time. President Biden wants Americans to believe `help is on the way.` But under this bill, it isn`t; waste is.

Biden Administration in SUPPORT (2/26/21): ARPA provides the tools and support critical to tackle the urgent public health and economic crises the Nation faces as a result of COVID-19. The bill also provides eligible Americans with a $1,400 payment in addition to the $600 payment provided in December of 2020. The bill also extends key emergency unemployment benefits, and raises the minimum wage to $15 per hour.

Legislative Outcome: Passed House 219-212-1 on 2/27/21; passed Senate 50-49-1 on 3/6/21; signed by President on 3/11/21.