Third World America (30 page)

40
At the time of the GAO report
: United States Government Accountability Office, “International Taxation: Large U.S. Corporations and Federal Contractors with Subsidiaries in Jurisdictions Listed as Tax Havens or Financial Privacy Jurisdictions,” Dec. 2008,
www.gao.gov
.

41
The company got billions from U.S. taxpayers
: Farah Stockman, “Top Iraq Contractor Skirts US Taxes Offshore,” 6 Mar. 2008,
www.bostonglobe.com
.

42
In 2008, KBR listed 10,500 Americans
: Ibid.

43
Indeed, back in 2002, to call attention
: Arianna Huffington, “Tax Avoidance and a Tan: Why I’m Thinking of Moving This Column to Bermuda,” 15 May 2002,
ariannaonline.huffingtonpost.com
.

44
Washington has been trying
: Stephen Ohlemacher, “Obama Cracking Down on Tax Havens,” Associated Press, 4 May 2009.

45
The latest tax-reform bills are far from perfect
: Gretchen Morgenson, “Death of a Loophole, and Swiss Banks Will Mourn,” 26 Mar. 2010,
www.nytimes.com
.

46
As the law stands now
: Pat Garofalo, “Baucus and Orszag See ‘Growing Sense of Inevitability’ for Ending Hedge Fund Manager Tax Break,” 13 May 2010,
www.thinkprogress.org
.

47
According to former labor secretary Robert Reich, in 2009
: Robert Reich, “Closing Tax Loopholes for Billionaires,” 23 May 2010,
www.huffingtonpost.com
.

48
Closing this outrageous loophole
: Ibid.

49
Indeed, the double standard was famously ridiculed
: Tomoeh Murakami Tse, “Buffett Slams Tax System Disparities,” 27 Jun. 2007,
www.washingtonpost.com
.

50
A more accurate snapshot
: Nan Mooney,
Not Keeping Up with Our Parents: The Decline of the Professional Middle Class
(Boston: Beacon Press, 2008), 3–6.

51
the jobless rate is almost 10 percent
: Bureau of Labor Statistics, “Alternative Measures of Labor Underutilization,” 2 Apr. 2010,
www.bls.gov
.

52
and twenty-six million people
: Rex Nutting, “GDP to Show More Balanced Growth, Survey Says,” 29 Apr. 2010,
www.marketwatch.com
.

53
Troy Renault is one of them
: Laura Bassett, “Middle Class No More, Families Struggle to Fight Off Homelessness,” 4 Feb. 2010,
www.huffingtonpost.com
.

54
Says Troy: “You wind up starting to think …”
: Ibid.

55
Rebecca Admire is another
: Ibid.

56
Mount Airy, North Carolina, for example
: Paul Wiseman, “When the Textile Mill Goes, So Does a Way of Life,” 11 Mar. 2010,
www.usatoday.com
.

57
And in Mount Airy—the city where Andy Griffith grew up
: Ibid.

58
“We were not prepared”
: Ibid.

59
By the end of 2009, the unemployment rate
: Dion Hoynes, “Blacks Hit Hard by Economy’s Punch,” 24 Nov. 2009,
www.washingtonpost.com
.

60
And 19.7 percent of all American men
: Floyd Norris, “In Global Unemployment, a Sea of Young Faces,” 16 Apr. 2010,
www.nytimes.com
.

61
“Every downturn pushes some people …”
: Peter S. Goodman, “Despite Signs of Recovery, Chronic Joblessness Rises,” 20 Feb. 2010,
www.nytimes.com
.

62
For a century, from the mid-1890s
: Dean Baker, “The Great Recession Didn’t Have to Happen,” 25 Jan. 2010,
www.cepr.net
.

63
By 2005, subprime mortgages had skyrocketed
: Gene Sperling, “Subprime Market—Isolated or a Tipping Point?” 14 Mar. 2007,
www.bloomberg.com
.

64
Fueling the boom was the development
: Jim Puzzanghera, “Senators Grapple with Derivatives Rules in Financial Overhaul,” 19 May 2010,
www.latimes.com
.

65
“The Federal Reserve Board completely failed …”
: Dean Baker, “The Great Recession Didn’t Have to Happen,” 25 Jan. 2010,
www.cepr.net
.

66
Even after a spate of accounting scandals
: Charles W. Caolmiris and Peter J. Wallison, “Blame Fannie Mae and Congress for the Credit Mess,” 23 Sep. 2008,
www.wsj.com
.

67
Between 2004 and 2007, Fannie and Freddie
: Ibid.

68
George W. Bush and the GOP also helped
: George W. Bush, Second Inaugural Address, 20 Jan. 2005,
http://georgewbush-whitehouse.archives.gov
.

69
By 2006, 62 percent of all new mortgages
: Dan Dorfman, “Liars’ Loans Could Make Many Moan,” 20 Dec. 2006,
www.nysun.com
.

70
Among the findings
: Sewell Chan, “Memos Show Risky Lending at WaMu,” 12 Apr. 2010,
www.nytimes.com
.

71
Enter the bankruptcy bill
: Jeanne Sahadi, “President Signs Bankruptcy Bill,” 20 Apr. 2005,
www.money.cnn.com
.

72
They even rejected an amendment
: U.S. Senate, “S. 256, the Bankruptcy Reform Bill,”
Congressional Record
, 109th Cong., 1st Sess., vol. 151, no. 26, 8 Mar. 2005,
www.senate.gov
.

73
According to the Institute for Financial Literacy
: Institute for Financial Literacy, “2009 Annual Consumer Bankruptcy Demographics Report: The American Debtor in the Great Recession,” Jun. 2010,
www.financiallit.org
.

74
The Institute’s executive director, Leslie Linfield
: Leslie Linfield, in an email communication with the author, 19 May 2010.

75
In fact, a 2009 study by researchers at Harvard
: Catherine Arnst, “Study Links Medical Costs and Personal Bankruptcy,” 4 Jun. 2009,
www.businessweek.com
.

76
Using that rate, roughly
: American Bankruptcy Institute, “Annual Business and Nonbusiness Filings by State (2007–09),”
www.abiworld.org
.

77
Here’s another: 78 percent of the so-called
: Catherine Arnst, “Study Links Medical Costs and Personal Bankruptcy,” 4 Jun. 2009,
www.businessweek.com
.

78
Barry Bosworth and Rosanna Smart of the Brookings Institution
: Barry Bosworth and Rosanna Smart, “The Wealth of Older Americans and the Sub-Prime Debacle,” Nov. 2009,
crr.bc.edu
.

79
We are facing nothing less than
: Lynn Adler, “U.S. 2009 Foreclosures Shatter Record Despite Aid,” 14 Jan. 2010,
www.reuters.com
.

80
and an estimated 3 million more are expected
: Dan Levy, “U.S. Foreclosures May Rise to 3 Million This Year,” 14 Jan. 2010,
www.bloomberg.com
.

81
Currently, mortgages are exempt from bankruptcy proceedings
: Wenli Li, Michelle J. White, and Ning Zhu, “Did Bankruptcy Reform Cause Mortgage Default Rates to Rise?” Apr. 2010,
www.philadelphiafed.org
.

82
Subsequent court battles eventually eliminated their use
: Doris Dungey, “Just Say Yes to Cram Downs,” 7 Oct. 2007,
www.calculatedriskblog.com
.

83
The banks scored a lopsided victory
: Ryan Grim, “Banks Beat Homeowners: Foreclosure Bill Killed in Senate,” 31 May 2009,
www.huffingtonpost.com
.

84
There had already been more than eight hundred thousand
: Julianne Peitone, “Foreclosure Filings Jump 24%,” 16 Apr. 2009,
www.money.cnn.com
.

85
But even after major concessions
: Ryan Grim, “Banks Beat Homeowners: Foreclosure Bill Killed in Senate,” 31 May 2009,
www.huffingtonpost.com
.

86
the Mortgage Bankers Association
: Margaret Chadbourn, “Senate Defeats Mortgage ‘Cram-Down’ as Democrats Balk (Update 2),” 30 Apr. 2010,
www.bloomberg.com
.

87
As ProPublica’s Paul Kiel reported
: Paul Kiel, “Disorganization at Banks Causing Mistaken Foreclosures,” 4 May 2010,
www.propublica.org
.

88
According to a study by the Brennan Center
: Melanca Clark and Maggie Baron, “Foreclosures: A Crisis in Legal Representation,” Brennan Center for Justice 6 Oct. 2009,
www.brennancenter.org
.

89
In New York’s Nassau County
: Ibid.

90
Having legal help can be the difference
: Ibid.

91
In 1996, the budget for the Legal Services Corporation
: Ibid.

92
At this point, to match
: Ibid.

93
The second barrier is that restrictions
: Ibid.

94
The $789 billion stimulus plan
: “After the Stimulus,” 12 Feb. 2009,
www.nytimes.com
.

95
Almost forty-one million homes
: Pew Charitable Trusts, “Defaulting on the Dream: States Respond to America’s Foreclosure Crisis,” Apr. 2008,
www.pewtrusts.org
.

96
The value of these homes
: Ibid.

97
This translates into a total property value loss
: Ibid.

98
A 1 percent increase in foreclosures
: Dan Immergluck and Geoff Smith, “The Impact of Single-Family Mortgage Foreclosures on Neighborhood Crime,”
Housing Studies
21, 6 (Nov. 2006): 851–66.

99
A September 2009
New York Times
story
: Erik Eckholm, “Surge in Homeless Pupils Strains Schools,” 5 Sep. 2009,
www.nytimes.com
.

100
The National Center on Family Homelessness
: National Center on Family Homelessness, “America’s Youngest Outcasts: State Report Card on Child Homelessness,” 2009,
www.homelesschildrenamerica.org
.

101
San Antonio, for example, enrolled
: Erik Eckholm, “Surge in Homeless Pupils Strains Schools,” 5 Sep. 2009,
www.nytimes.com
.

102
homeless children are four times as likely
: National Center on Family Homelessness, “Annual Report: Working to End Family Homelessness,” 2009,
www.homelesschildrenamerica.org
.

103
twice as likely to have learning
: National Center on Family Homelessness, “Homeless Children: America’s New Outcasts,” 1999,
www.homelesschildrenamerica.org
.

104
“We see eight-year-olds telling Mom …”
: Erik Eckholm, “Surge in Homeless Pupils Strains Schools,” 5 Sep. 2009,
www.nytimes.com
.

105
Banks don’t want to adjust nonperforming mortgages
: Melanca Clark and Maggie Baron, “Foreclosures: A Crisis in Legal Representation,” Brennan Center for Justice, 6 Oct. 2009,
www.brennancenter.org
.

106
The four largest banks
: “Miller, Ellison Introduce Bill to Address Conflict of Interest in Mortgage Companies,” 1 Apr. 2010,
www.bradmiller.house.gov
.

107
These banks collectively hold
: Mike Konczal, “Principal Writedowns and the Fake Stress Test,” 9 Mar. 2010,
www.rortybomb.wordpress.com
.

108
“The banks are too big to fail”
: Matthew Karnitschnig, Deborah Solomon, Liam Pleven, and Jon E. Hilsenrath, “U.S. to Take over AIG in $85 Billion Bailout; Central Banks Inject Cash as Credit Dries Up,” 16 Sep. 2008,
www.wsj.com
.

109
As of January 2010, U.S. consumers
: Jeremy M. Simon, “Consumer Credit Card Balances Fall for 16th Straight Month,” 5 Mar. 2010,
www.creditcards.com
.

110
98 percent of which is credit card debt
: Ben Woolsey and Matt Schulz, “Credit Card Statistics, Industry Facts, Debt Statistics,” 13 May 2010,
www.creditcards.com
.

111
There are more than 576 million credit cards
: Ibid.

112
The average credit cardholder has 3.5 cards
: Ibid.

113
“For much of America,” says Elizabeth Warren
: “Elizabeth Warren on Credit Card ‘Tricks and Traps,’ ” NOW, 2 Jan. 2009,
www.pbs.org
.

114
In fact, in 2007, even before the economic crisis began
: National Association for the Advancement of Colored People, “Usury: The Impact of Credit Card Debt and High Interest Rates on African American Wealth,” 4 Sep. 2009,
www.naacp.org
.

115
In 1958, American Express pioneered
: Ben Woolsey and Matt Schulz, “Credit Card Statistics, Industry Facts, Debt Statistics,” 13 May 2010,
www.creditcards.com
.

116
But the modern credit card industry: Marquette Nat. Bank v. First of Omaha Corp.
, 439 U.S. 299 (1978).

117
Hoping to lure banks’ business
: Robin Stein, “The Ascendancy of the Credit Card Industry,”
Frontline
, 23 Nov. 2004,
www.pbs.org
.

118
“In 1980, the typical credit card contract …”
: “Elizabeth Warren on Credit Card ‘Tricks and Traps,’ ”
NOW
, 2 Jan. 2009,
www.pbs.org
.

119
Fees now account for 39 percent of card issuers’ revenue
: Steven Gray and Michael Peltier, “Exposing the Credit-Card Fine Print,” 21 Feb. 2008,
www.time.com
.

120
In fact, last year, lenders collected more than $20 billion
: Robin Sidel, “Banks Roll Out New Check, Card Fees,” 2 Jan. 2010,
www.wsj.com
.

121
“inactivity fee” for not using their card!
: Brad Tuttle, “Credit Card Fee Watch: Now There’s a Fee for NOT Buying Stuff,” 6 Aug. 2009,
www.time.com
.