interviews
Labor and the White House
by Dave Weigel
March 31, 2021
This interview with Dave Weigel, national reporter covering politics for the Washington Post, was conducted and condensed by franknews and Payday Report.
DW | The White House's involvement in the Amazon union drive was a big surprise. I mean, we know where it could have originated, the union talked to the White House; they have kind of an open door with Biden that they didn't have with Trump. We know that Faiz Shakir, Bernie Sanders’ campaign chairman, and his group, Perfect Union, got involved. So, there was public pressure.
The fact that the White House and the president released that video was a big deal to people. And, he made this decision to get involved very early on in his presidency. It was within his first 50 days. He decided to do what hadn't been done before and give a message in support of the union. It was a very careful message. The new labor secretary, Marty Walsh, when asked specifically about Amazon, responded in more general tones.
But, no matter what happens, if you are in for a penny, you are in for a pound.
A lot of previous presidents, including Barack Obama, said a lot less about these union drives and, in doing so, limited their own exposure. If the drive didn't work, people didn't say that the president supported something that didn't work. The fact that Biden made a statement, early on, when it wasn't clear how this was going to go, is a real political statement of what they thought was important.
frank | How do you think his background plays a role in this?
He's always leaned in really hard and identified with workers in the same way he's tried to identify with different civil rights movements. Joe Biden has always wanted to be seen as the kind of person who is coming from Scranton, who has lived through the sixties, and who wants to jump to the front of the march if there is a struggle happening.
He frames everything in terms of fairness. He's not as natural as other members of the party in talking about this. When Bernie Sanders talks about this, for example, he talks about greed, he names CEOs, he says nobody deserves that much money, he talks about a maximum wage and how there should be no billionaires at all. Biden doesn't go that far. Biden has never gone after Jeff Bezos. He's never gone after individual heads of companies the way that Sanders does. He does this sort of a "Hey man, these guys are under assault, somebody needs to stick up for them."
That is something that he has always wanted to be part of his brand. Even when he was voting for trade deals like NAFTA as a Senator, he was never really comfortable. He had the same ideological mindset as a lot of the Democrats in the eighties and the nineties. He did it because he saw that that was the way things were moving and he voted strategically. But, the stuff that fired him up was when he could side with workers. It is the same thing with the projects he took on under Obama when he was Vice President.
During the Democratic primary, he didn't get the same amount of labor support that Hillary Clinton did, but, Sanders didn't get it either. There wasn't the same sort of a landslide of labor to get in early and say, this is our candidate. Instead, they were demanding more of the candidates.
I would cover presidential primary events with the Teamsters in Cedar Rapids or the Building Trades in DC and you would kind of look to the level of applause as an indicator. The interesting thing is that at those events Sanders would lay out the things he did and what he wanted to pass. Biden would go on at length about non-compete clauses and about wage theft and things like that. It was less, "I have studied all of the papers on this and I've decided this is my policy," and more of "this seems unfair and I'm against this thing."
I think the Democratic Party is increasingly understanding what labor can mean for them strategically.
Republicans have gotten kind of tangled up on labor. They have done better with union households, but they are basically the party of deregulation still. They've never really moved on the labor part of their messaging. That makes it easier for Biden to compete for these workers. When it comes down to it, Republicans want “right-to-work." Josh Hawley, who branded himself as a working-class candidate, for example, supports a national right-to-work.
Biden was very concerned with winning back more union households. Union workers were saying, “Democrats had the presidency for 16 years. What do they do for us?” Biden didn't have all the answers that labor wanted, but he was making a lot of specific promises about how he was going to act. He talked about infrastructure spending and about how he was going to run the NLRB and how he was going to approach employers. It was less than Sanders did, but that's way more than Democrats had done in the past.
I mean, the McCain/Romney era Republicans had no appeal to the sort of voters who voted for Obama twice and then voted for Trump. Biden only peeled back maybe 10% of them depending on where you're talking about, but it has made life easier for Democrats.
This fight has in large part been framed in the context of continuing a battle for civil rights. Do you see Biden lean into that messaging?
Biden did not really lean to the racial justice aspect or the civil rights legacy aspect of this labor fight. When the congressional delegation here came down a couple of weeks before the vote, they were much more explicit. Someone like Jamal Bowman or Cori Bush is much more comfortable saying that than Biden. That is the thing about Biden. He basically sets boundaries. He says what his position is and backs off and lets the action happen without his constant commentary. It's very different than Trump in that way too. And that's different than the Sanders position. And it's different than what Warren said her position would be as president.
Can you give us context on how or why you started covering this story?
I started covering the Amazon drive because of the president and members of Congress intervening. I mean, labor decided to get involved months before, but the fact that Democrats were getting involved was new. It has been interesting to monitor their investment in this over other Democratic Party causes.
There's a little bit of intervention from the Democrats, but not, I'd say equal to what Amazon is doing. They are not the advertisements on TV. We all know the Democratic party is kind of involved, but it is not the same political project that I've seen in other places.
There are two stories that kind of were happening at the same time; they have merged, but not completely. One is this labor drive, which is smaller than most drives that have succeeded. It is not overwhelming. You don't see labor signs everywhere you go. But, on the other hand, the level of national involvement is kind of new.
Had Biden said nothing, there would have been a story, but it wouldn't involve the White House, it wouldn't involve the Democratic Party, and it might not involve the PRO Act.
And I think that's going to change because of this.
New interview w/ @daveweigel @PaydayReport
— frank news (@FrankNewsUS) April 6, 2021
"The White House's involvement with the Amazon drive was a big surprise ... Previous presidents, Obama comes to mind, said a lot less. The fact that Biden did that early on is a political statement of what they thought was important." pic.twitter.com/MwYlmqE4xQ
That was a big decision Biden made to be a part of this.
Right. And that political story is interesting. The story here is much more independent. A lot of the people who've come in to help canvas are from smaller groups. You have Black Lives Matter and DSA groups from the area, but you don't have the Democratic Party getting involved in a huge way. I think that is something that people will revisit after the vote.
Should the Democratic Party, like most left parties in the world, be very involved with labor? Should they always take the side of labor?
Most social democratic parties are labor parties and they build up from there. Their coalition includes labor unions. In the British Labour Party, for example, labor has a role in electing the leadership. That is not the case here. That's the conversation I think they're going to start having when this votes over. For example, if there are, and the union says there are, hundreds of people around the country calling them saying, "Hey, I have some questions about what I can do at my fulfillment center in my town," that will be a question for Democrats.
And if Amazon wins, do you get spooked? Amazon has been very punchy in their PR. They might say that a bunch of elite Democrats stood with the union and the workers stood with Amazon. That is very comfortable turf for Amazon to be on, and that leaves a big question open for Democrats. If the union succeeds, throw all of that out the window. I think the lesson that everyone would take in that case would be that if it takes less than a three-minute video from the president to get momentum for something like this, then we should keep doing that. As we talk, I don't know the answer to that question. I think that is something that is going to be answered when the votes are in.
interviews
A Failed Lending System
by Alan Collinge
September 30, 2020
Alan Collinge, founder of StudentLoanJustice.org, was conducted and condensed by franknews.
Alan | I have a bachelor's, a master's, and an engineer's degree. I began looking deeply at the student loan problem because of my own student loan issues, and in 2006 I decided to dedicate myself to this work full time. The debt crisis, unfortunately, has only become worse since those days.
frank | And how do you articulate what the problem is?
The problem is that student loans have been exempt from the most fundamental consumer protections — some of which are called for in the constitution. Unlike every other loan in this country, student loans do not have bankruptcy protection. Student loans do not have a statute of limitations. Fair Debt Collection Practice laws, Truth in Lending laws. Even state usury laws have been restricted or eliminated for most student loans.
The founding fathers themselves were savaged under the predatory British banks and merchants. They understood the importance of bankruptcy protections. And indeed, if you look at Article I, Section 8 of The Constitution, the founders call for uniform bankruptcy laws ahead of the power to raise an army, declare war, and even coin currency. But student loans have been essentially stripped of this protection.
Within that failure, what do you seek to do as an organization?
Well, for the first 15 years of our existence, we were fighting only for the same bankruptcy protections as every other type of loan. It hasn't worked, unfortunately. Congress failed us.
When I started this, student loan debt stood at $400 billion. There is now $2 trillion in outstanding student loan debt. Some of the official numbers are lower than that, but those numbers do not include a lot of the interest charges or private loans — home equity loans, for example —that families take out to pay for college. With these taken into account, we are well over $2 trillion of college debt. Now, in addition to the return of standard bankruptcy rights, we are advocating for all federal student loans to be canceled.
The student debt crisis is a national threat. We now know that the default rate for the class of 2004 was around 40%, and students in 2004 were borrowing only a third of what students today borrow. By our best estimates, before the pandemic, 80% of borrowers were never going to be able to pay back their student loans. Today, when 50 million people are losing their jobs, many of which will not return, it seems like it is time for all federally owned student loans to be canceled.
Does the increase in college accessibility and the inability to declare bankruptcy go hand in hand?
That is a good point. College accessibility has increased dramatically since the 1970s, when some of these consumer protections were rolled back. Around 30% of the population was going to college then, and now around 60% of the population is attending college.
There are better ways to make it more accessible. We should fund community and state colleges to a point where people can take on little to no debt.
So how did these consumer protections get stripped away?
My theory might be slightly controversial. There's something called the Powell Memo that Lewis Powell authored as a special advisor to President Nixon. He wrote it as a result of watching the cultural revolution of the 1960s. Mr. Powell outlined a series of steps that conservatives should take to prevent what happened in the 60s from ever happening again. He advocated for the changing of the guard across the country. He says that monied and conservative interests should infiltrate colleges, media, NGOs, and think tanks in order to sow the seeds of their ideology.
Sallie Mae was established months after the Powell memo was published, and in the 1970s we began removing bankruptcy protections.
In 1998, federal student loans became forever impossible to discharge in bankruptcy, and, astonishingly, this exception to discharge was extended to private student loans in 2005. This gave the lenders carte blanche to hound borrowers for the rest of their lives. This led to a huge boom in lending for colleges. This is also when the colleges began to really raise their prices.
While Sallie Mae began as a government-sponsored entity, they decided to go private around the mid to late 1990s — this around the same time they acquired the largest loan collection companies and largest guaranty agency in the country. This government-sponsored entity essentially morphed into a fully for-profit, privately held monopoly over the student loan market.
And what are the consequences of stripping these consumer protections away?
It’s an incredibly predatory system. People can have their wages garnished for defaulting on loans. Senior citizens and the disabled can lose their benefits. People can be fired from public employment. They can lose their professional licenses, and in some cases, they can even lose their driver's licenses if they default on federal student loans. It is a sort of one, two punch. There are no consumer protections, and on top of that, there is also a draconian, mafia-like collection regime.
After 15 years of working on this, you have a bill in the House and a bill in the Senate that aims to restore protections.
At long last, we have good legislation. We have two bills right now: S.1414 in the Senate, and HR 2648 in the House. Dick Durbin is the sponsor in the senate, and Jerry Nadler and Republican John Katko are the sponsors in the House.
There is no good reason that this bill shouldn’t pass. The sticking point is the Republicans in Congress, to be quite frank. Right now our number one goal as a group is to get a Republican senator to co-sponsor this legislation.
Outside of Congress, we have conservative support from places like the Cato Institute, The National Review, David Brooks, the conservative commentator at the New York Times, AND conservative scholars at George Mason University. These places agree that bankruptcy protections must be returned to student loans, but because of the way the industry has courted Republicans, as well as Democrats for that matter, we are stuck.
Politically, do you feel like either party has a good grasp and effective communication plan to tackle this issue?
Again, 80 percent of people, according to the Department of Education, will likely never be able to pay their loans. That is 44 million people in the country walking around, losing sleep over their student loans. And these people vote far more than average. 44 million votes can turn a loss into a landslide; even a third of that can turn a loss into a landslide. This is an electoral bonanza, the likes of which we have never seen before. In any other issue in this election — healthcare, defense, civil rights, etc — the battle lines are drawn and it is hard to move many people from one side to the other. It is the wild west with the student loan issue. Neither party has gotten their arms around this thing, and frankly, no sitting member of congress wants to touch it because it is such a big problem that has continuously been kicked down the road.
We started a petition calling on the president to cancel student loans through an executive order.
In Congress, if you pass legislation that costs the taxpayer anything, you have to come up with funding to support the legislation. So in order to cancel $1.7 Trillion in student loans through congressional legislation, you have to find that money. That requires cutting an equal amount from other areas, raising taxes, or adding to the national debt. That is just never going to happen. Congress will never pass legislation that cancels student debt fully. If they pass legislation it will be limited; there will be many strings attached, and ultimately, very few borrowers will actually see their loans canceled.
However, the president has the executive authority to demand the Department of Education to cancel all the student loans that it owns, which is about 85 percent of all student debt. The president can do that without needing one dime of tax appropriation or any congressional approval, and, I might add, without adding one penny to the national debt. The taxpayers already paid for these loans. There is no good reason that they need to pay twice! That is the solution we are pushing for, and we have over 700,000 signatures from people who span the political spectrum. I estimate that 40% of student loan borrowers are politically independent, and about 20% identify as Republicans. This really is a huge voter bonanza for whichever candidate steps up to solve it by executive order.
Are you hopeful that politicians will acknowledge that and act on it?
I am very happy to report that last week, Elizabeth Warren and Chuck Schumer have adopted our strategy and are now championing it. They introduced a Senate resolution calling on President Trump to cancel "up to $50,000" in federally owned student loans by executive order. While their plan is frankly vague, and a bit suspicious this close to the election, it is very encouraging to see that the concept of federal loan cancellation by executive order proposed. I believe we have really started something good here.
I can only hope that both parties will converge on this solution. There is no better opportunity than this pandemic to reset this failed lending system, massively stimulate the economy, free the 44 million Americans from the jaws of this nationally threatening lending system, and replace it with a more rational and just funding model for higher education in this country.