PennPIRG's blog

Vast Majority of PA College IDs Not Valid for Voting

A recent study released today by PennPIRG and a broad coalition of voter protection groups found that Pennsylvania’s new photo ID voting law could potentially disenfranchise more than 80% of the state’s college students.

While the law states that it will allow college IDs as a valid form of voting ID, it also includes language requiring that all IDs must have expiration dates, which the study found very few colleges in the state actually print on their issued IDs.

Out of the 110 surveyed colleges and universities only 15 schools have student identification cards for all students that meet the requirements of having a photo, name and expiration date on the card [1].

The recent survey was conducted by a diverse coalition of voter protection groups in the state, including PennPIRG, the ACLU, Committee of Seventy, Project H.O.M.E, the Lawyers Committee and Project Vote.

“Voter fraud isn’t a problem in Pennsylvania: Voter engagement is,” said Alana Miller of PennPIRG. “It’s estimated that only 74% of all eligible Americans are registered to vote and in 2008, a year that saw one of the highest turnouts in recent history, only 63% cast their ballot. Lawmakers should be looking for solutions that encourage full participation in democracy, not creating laws that set up hurdles for committed voters.”

Stefano Fuchs, a junior at Muhlenberg College, a school with IDs that will not be valid for voting, said, “It’s often hard as a college student to vote because of the transient nature of our living situation. However, elected officials should be doing what they can to increase voter turn out, not stifle it.”

The state legislature did not make sufficient effort to accommodate students by including college IDs as they are issued at most schools in the state as a valid form of identification for voting.

Making Super PACs Illegal.... How?

A new Washington Post- ABC News poll shows that almost 7 out of 10 voters believe that super PACs, the independent expenditure only committees created in the wake of the Supreme Court’s disastrous Citizens United decision, should be illegal. Super PACs are not responsible for all problems with American democracy, however, they do amplify those troubles so it is no surprise that the public is crying out in opposition to them. Unfortunately, due to the Court’s backwards interpretation of the first amendment, we cannot legislate away super PACs today. However, there are some very important steps that every level of government – from your city council to the White House - should take right now to mitigate the impact of super PACs before the 2012 election.

There are three main problems with super PACs: unlimited money, corporate money, and secret money.

Unlimited Money: Super PACs are allowed to raise unlimited funds from any given single source, which allows corporations and the ultra wealthy to directly translate economic success into political power. PennPIRG and Demos’ recent report Auctioning Democracy found that 96% of all super PAC funds came in contributions of $10,000 or more from just 1,096 sources. Forget the 1%, that political elite is actually the equivalent of .000351% of the population. In other words, unless you have $10,000 stashed away in a cookie jar to give to a political campaign, your contribution may be severely minimized.

50 YEARS AGO THIS WEEK, JFK USHERED IN MODERN CONSUMER PROTECTION ERA

People of almost any age know a lot about the Kennedy administration with its optimistic beginnings and its sudden, tragic end. Yet many have probably never heard of one of JFK's important legacies -- his declaration that consumers have rights that deserve protection.

Fifty years ago, on March 15, 1962, President Kennedy issued his "Special Message to the Congress on Protecting the Consumer Interest." While his ambitious agenda has not been fully realized, the sweep of his vision bears revisiting.

Kennedy said,

If consumers are offered inferior products, if prices are exorbitant, if drugs are unsafe or worthless, if the consumer is unable to choose on an informed basis, then his dollar is wasted, his health and safety may be threatened, and the national interest suffers.

So, he identified and then called for government action to protect four consumer rights: The right to safety; the right to be informed; the right to choose; and the right to be heard. Other presidents and consumer organizations have added to his work -- proposing rights to consumer education and consumer redress, for example -- but those important additions simply built upon JFK's robust platform.

Kennedy called for enactment of legislation to guarantee the efficacy and safety of prescription drugs and cosmetics because: "Thousands of women have suffered burns and other injuries to the eyes, skin and hair by untested or inadequately tested beauty aids." He called for new food safety rules, which finally passed in 2010.

Above all, Kennedy said, "protection of the public health is not a game."

He called for passage of "truth in lending" legislation to end "serious abuses." He demanded both nutrition and other packaging labeling: "Just as consumers have the right to know what is in their credit contract, so also do they have the right to know what is in the package they buy."

White House Plan to Close Special Interest Tax Loopholes Is the Right Approach to Reform, But Details Matter

The President has put forward the beginnings of a tax reform plan that takes the right approach, but is still missing critical details.
 
America needs a level playing field where businesses succeed by being more productive and innovative, not by hiding profits in the Cayman Islands or other tax havens. By ending special-interest tax preferences, the administration plan could help the economy and reduce debt, while addressing public outrage about large companies dodging their taxes.
 
The current system serves nobody except the relatively few companies that can most exploit these loopholes and the armies of tax lawyers and lobbyists that must be hired to play this destructive game.”
 
The President’s plan includes very promising proposals. If the details include reforms such as complete reporting of all profits and taxes paid, clear cut rules to end profit shifting to bogus off-shore subsidiaries and enforceable minimum rates to deter tax avoidance gamesmanship, then this plan will fulfill its promise.
 
Preventing firms from sheltering profits overseas will encourage companies to keep their business here.  We were encouraged to see some of the revenue raised put toward clean energy. We urge that loophole closing is pursued aggressively and that additional revenue will be put toward some combination of reducing the public debt and reducing severe cuts to public priorities.

Today, CFPB to possibly end $39 lattes

Would you knowingly agree to pay a $35 fee each time you used your debit card at point of sale, simply to allow you to purchase a $4 latte with only $2 in your account? Even the banks didn't think so, that's why they made “standard overdraft protection” a feature of your checking account that you didn't need to choose. Banks also changed the default switch on debit and ATM cards to allow overdrafts. The combination of these practices, along with the switch from cash to debit card transactions encouraged by rewards programs, made overdraft revenue a major profit center over the last 12 years or so, as the old regulators mostly slept.

At a news conference in NYC today, Director Richard Cordray of the new Consumer Financial Protection Bureau (CFPB) will announce a major investigation of bank overdraft fee practices and propose a model "penalty box" disclosure to appear on bank statements. From Ylan Mui of the Washington Post: "The bureau said it will look into whether banks are reordering customers’ debit-card charges to maximize overdraft fees. Reordering transactions can double or triple penalties, and the practice has been the target of several class-action lawsuits against the nation’s biggest banks. The CFPB’s inquiry also will focus on bank overdraft policies, how they market the plans, and their impact on low-income and young consumers. The agency will solicit feedback from the public."

House Transportation Bills Strike First as Tragedy, Then as Dangerous Farce

With much fanfare and 854 days late, the U.S. House last week introduced bills to fund our nation's transportation system for the next five years. The new rules for spending $260 billion over five years would be tilted more toward highways with less going to buses, rail, biking and pedestrian trails. Given the nation's urgent need to reduce our addiction to oil, that in itself would have been a tragedy.

But later in the week tragedy turned into a dangerous farce. The House introduced additional legislation proposing that new revenue for the Transportation Fund would come through increased volumes of oil drilling and that public transit would be kicked out of the transportation fund. This breaks with three decades of public transit being supported by a small portion of the federal gas tax. The House measure would instead funnel all these funds to highways, and leave mass transit to search for new money from Congress at a time when debt reduction rules require massive cuts to the general budget.

If you were trying to make America as addicted to oil as possible, you might design legislation like this.

The Regulatory Accountability Act is a Dangerous Bill that Threatens the Health of Our Children

An opinion piece that appeared in Politico on January 31st, by Senator Pryor and Senator Portman misleadingly paints the Regulatory Accountability Act (RAA/H.R. 3010) as a regulatory savior. This could not be further from the truth. In reality, the RAA would create new hurdles and delays, blocking implementation of an untold number of public health and safety rules. It would add layers of new bureaucratic processes before even simple public health rules could be enforced. It would empower special interests to use the courts to delay protections that have been years in the making.

Two disturbing examples of what RAA will do if enacted: After a 10-year fight, Congress authorized and the Consumer Product Safety Commission developed new safe crib standards. America’s most vulnerable population – infants – finally received protection against collapsing cribs that injured and killed far too many. RAA would make have made it easier for special interests to contest the new crib standards in court, delaying further these critical protections; The new U.S. Environmental Protection Agency’s mercury and air toxics standards, in development for over 20 years would not have been enacted under RAA. Special interest would have asked that these rules be further analyzed by the EPA, causing power plants to keep emitting mercury, a powerful neurotoxin that is very harmful to children and fetuses. Under RAA costs to business will be considered first before public health benefits.

What Do Jon Stewart, Elizabeth Warren, and Barack Obama Have In Common?

It’s been a big week for calling out corporate tax dodgers.

In his State of the Union speech, President Obama called for an economy where “everyone plays by the same set of rules” and where companies can’t avoid taxes by shifting profits overseas. He acknowledged what we’ve been saying for a long time which is that special interests have long played by a different set of rules than the rest of us – ones they’ve helped create, I might add.

That same night, Massachusetts Senate candidate Elizabeth Warren went on the Daily Show and called out 30 corporations that a recent Pennsylvania Public Interest Research Group (PennPIRG) and Citizens for Tax Justice study found paid more to lobby Congress than they did in federal income taxes between 2008 and 2010. When Warren told this to John Stewart on the Daily Show, it made the usually unflappable comedian’s jaw drop.

The special treatment that special interests have won over the years is on full display when it comes to our tax code. While small businesses and ordinary taxpayers pay taxes on the income they earn, companies like GE and Wells Fargo have so deftly manipulated the tax code that they paid no taxes on billions of dollars in profits between 2008 and 2010. In fact, they actually got tax rebates from Uncle Sam on tax day. While it may sound criminal, it’s all perfectly legal.

Most taxpayers can’t employ hoards of tax lawyers to manipulate the tax system or hire an army of lobbyists to craft the tax code in their favor. Warren put it best during her Daily Show interview: “Washington now works for those who can hire an army of lobbyists and an army of lawyers.” The “Dirty Thirty” companies identified by PennPIRG and CTJ all told spent nearly half a billion dollars lobbying Congress on tax policy and other issues over the three year period of the study. “They hire those people to make [the tax code] onerous so they can worm their way through,” as Stewart rightly asserted.

Tax Havens Used by Romney and Large Corporations Cost Taxpayers Billions

With the heightened attention paid to Mitt Romney’s use of offshore tax havens, it is important to remember that tax havens are more than just an electoral issue. Tax havens are a serious policy matter that profoundly affects ordinary Americans, our economy, our national debt and our long-term competitiveness. Some facts to remember:

• Tax havens cost taxpayers an estimated $100 billion a year according to the Senate Permanent Subcommittee on Investigations. For comparison, this amount represents more than seven times the entire state budget of Iowa, New Hampshire and South Carolina combined.
• Abuse of tax havens forces individual taxpayers and small businesses to pick up the tab. A PennPIRG study last year showed that the amount shouldered by each American tax filer averages to about $434 last year. (Source: http://pennpirgorg.live.pubintnet-dev.org/reports/pap/tax-shell-game)
• The actual tax rate paid by individuals or companies that use tax havens may in fact be much lower than reported. Due to lack of strong disclosure laws, tax havens can effectively hide income in ways which may be completely legal.
• The more U.S. business profits depend on tax havens, the less companies compete based on their efficiency or innovation with goods and services. America cannot rebuild its economy around competitive tax avoidance.
• Use of offshore tax havens is a national security issue because shadow funds can finance terrorism and organized crime. This is one reason why numerous law enforcement organizations support greater disclosure of tax haven information.
• Due to the size of the U.S. economy, the American government has a unique ability to stop abuse of offshore tax havens. No significant financial player can afford to disobey U.S. financial laws if non-compliance might interrupt their ability to transact with U.S. banks and markets.

The "Dirty Thirty" Corporations that Spend More on Lobbying than Taxes

Taxes and democracy are two oft-maligned activities that Americans dearly depend on. "Indeed it has been said," noted Winston Churchill, "that democracy is the worst form of government except all those other forms that have been tried from time to time." He might just as easily have been talking about the responsibility of paying taxes.

Two years ago the Supreme Court's misguided Citizens United decision struck down long-standing Congressional limits on the political power of large corporations by vastly expanding the legal metaphor that "corporations are people." Now there is fresh evidence that corporate influence over Congress makes it easy for those same corporations to avoid their civic duty of paying taxes.

A new report identifies thirty Fortune 500 corporations that pay less in federal income taxes than they spend on federal lobbying.

You read that right. These companies - dubbed the "Dirty Thirty" - exploited loopholes in the tax code so aggressively that all but one of them enjoyed a negative tax rate over the three year period of the study, while together spending nearly half a billion dollars to lobby Congress on issues including tax policy. Instead of paying for the public structures such as roads, police and education which make their profits possible, they collected $10.6 billion in tax rebates from the federal government. Had these thirty companies paid the statutory 35 percent corporate tax rate, the Treasury would have collected an additional $67.9 billion.

Every dollar in taxes avoided by these Fortune 500 companies is a dollar that must be cut from public programs, added to the national debt, or paid in the form of higher taxes by ordinary taxpayers.

The companies in the Dirty Thirty include household names like General Electric, Verizon, Mattel, Wells Fargo, Dupont and FedEx. There's no avoiding how the story at each of these companies represents a mockery to both our tax system and our democracy.

President’s Recess Appointment Gives Watchdog Teeth It Needs To Protect Consumers From Wall Street Financial Shenanigans

By Edmund Mierzwinski and Alana Miller

Kudos to President Obama for standing up for consumers this week by making a recess appointment of former Ohio Attorney General Richard Cordray to head the new Consumer Financial Protection Bureau. The President’s action means that the CFPB now has all its powers to protect the public from unfair financial practices, whether by banks or other financial firms, such as payday lenders and credit bureaus.

Since July 21, the CFPB – a centerpiece of the 2010 Wall Street Reform and Consumer Protection Act – had been up and running, but only with partial powers. It is the nation’s first federal financial regulator with only one job – protecting consumers, including seniors, students and servicemembers, from unfair financial practices.

Now with a director in place, the CFPB has additional abilities that kick in, including the right to supervise payday lenders, mortgage companies, credit bureaus, debt collectors, private student lenders and other non-banks. It also now has additional powers over banks and credit card companies.

Along with civil rights, labor, senior and consumer groups, PennPIRG had long urged the Senate to confirm Cordray, the former Ohio Attorney General, to direct the CFPB. Recently, 37 state Attorneys General, on a bi-partisan basis, had sent a letter to the Senate urging confirmation.

Yet, at the behest of both the Wall Street banks and the payday lenders, some Senators had opposed confirmation of any CFPB director. 45 Senators, including Pennsylvania’s own Senator Toomey, had written the President in May and told him that they would block confirmation of any director until and unless the CFPB’s independence and authority were first restricted. Then, on December 8th, 45 Senators blocked Cordray’s nomination. They wanted the CFPB weak and powerless and with a tin cup in hand.

Trouble in Toyland

Holiday shopping season is upon us once again. As a parent, relative, or friend, shopping for toys for the children in your life can be a challenge. 

We don't always know if the gifts will be a hit but the one thing we count on is that the toys we purchase are safe.  Thanks to the hard work of agencies like the Consumer Product Safety Commission (CPSC) and consumer advocates like U.S. PIRG that's largely true.  But as our toy shopping researchers have found, that's not always the case. 
 
Each year, PennPIRG publishes a report, "Trouble In Toyland," that highlights a sampling of unsafe toys, ones we found in a survey of toy stores across the country. Over the past 25 years, the findings of our report have paid off, leading to more than 100 recalls and millions children's products pulled from store shelves.  The findings also provided valuable evidence in support of the need for a 2008 law that gave the CPSC more authority to crack down on manufacturers and importers of dangerous toys. 
 
Despite important progress, parents need to be aware of ongoing hazards and be on the lookout for unsafe products. More than 250,000 American children made trips to the emergency room in 2009 due to toy-related injuries. Toy safety should not be a political or partisan issue.  I have yet to hear any policy maker argue 'caveat emptor' (let the buyer beware) as it relates to toddlers.  That is why it is all the more shocking to see new, sweeping attacks in Congress on some of the most basic health and safety protections for young children as well as the broader public. 
 

If our political leaders REALLY want to help small business…..

It seems like almost every other word we hear from our political leaders is about the need to support small businesses to get the economy back on track. As small business owners, there’s one simple thing that could be done that would provide almost immediate help.

Small business owners have big troubles with big banks and credit cards and the new Consumer Financial Protection Bureau (CFPB) should take a look at the numerous obstacles.

First, banks don't like smaller accounts. Many of us face hassles even receiving business lines of credit. Often, we rely on our personal cards to fund our small businesses.

But when we face fraud problems or billing disputes related to those business uses, the banks say that the consumer protection laws don't always apply. Even consumer groups say it's a gray area. And where we have rights, we have to fight with the banks, which, as you might imagine, does not often lead to a result in our favor.

For those of us who do qualify for business credit cards, the cards have no consumer protections under the law. Banks can raise our interest rate at any time for any reason, or for no reason at all. Banks can lower our credit limit at any time, even to amounts below our current balance. There are no restrictions on penalty fees. When we are victims of fraud or billing errors we have no right under the Truth In Lending Law.

Consumers gained important new protections in the Credit CARD Act of 2009. In response, some credit card companies have been accused of marketing business cards to consumers and then denying those consumers their rights because they have business cards, not consumer cards.

A fee too far

We've posted about avoiding bank fees before, but the latest Bank of America shenanigan deserves another word of caution.

With its latest $5/month debit card fee, Bank of America has made the decision to balance its books on the backs of its customers, instead of changing its business model to be more consumer-friendly. Chase and Wells Fargo are also testing a $3 debit card fee in certain markets.

Big banks have always had the biggest fees, and they get away with it on the premise that their customers won't bank elsewhere. But free checking still exists, and small banks and credit unions are not likely to copycat what big banks are doing on debit card fees.

As a consumer advocacy organization, our advice to consumers is clear: Vote with your feet. Ditch your big bank for a credit union or community bank. You'll be better off for it.

Avoid bank fees

In this tough economy, smart shoppers know they need to shop around to get the best deals on groceries or gas, but where we bank can also have a big effect on our wallets.

Increasingly, big banks are charging more outrageous and more hidden fees to use basic services.

According to a new article by The American Banker, the industry’s leading trade paper, 96% of big banks offered free checking just two years ago, as opposed to 35% today. However, AB also reports that free checking is still “alive and well” at small banks.

PennPIRG’s advice to consumers remains simple: shop around (see our banking guide). Big banks can charge increasingly bigger fees and make it harder for customers to avoid them because they know consumers don’t shop around.

For the best value, use a credit union or a local community bank, not a big bank. Our reports consistently show that big banks charge bigger fees.

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