Jul 18 2007

Schumer/Maloney: American Families are Losing Ground on Bush's Watch; Income Down, Poverty Up Since 2000

SCHUMER: HITS KEEP ON COMING FOR U.S. HOUSING MARKET

 

Fed’s New Pilot Program to Rein in Subprime Loan Broker May Not Be Enough; Tougher Federal Laws Needed to Hold Mortgage Broker Accountable

 

With New Permits Way Down, JEC Chair Call to Stem Tide of Foreclosures With Foreclosure Prevention Funding for Families on Brink of Losing Their Homes

 

Today, the U.S. Department of Commerce announced that June home building permit applications dropped far below expectations to the lowest rate in the last decade, down 7.5 percent to 1.406 million units, just slightly higher than the 1.402 million unit rate of June 1997. U.S. Senator Charles E Schumer (D-NY), the chairman of the Joint Economic Committee (JEC), released a report showing that rising subprime mortgage foreclosures could lead to further weakening of the housing market as more supply is dumped onto the market. In response to today’s disappointing housing numbers, Sen. Schumer reiterated his support to help existing homeowners by stemming the tide of avoidable subprime foreclosures.

 

“The hits just keep on coming for the U.S. housing market. Today’s data that new house building permits are way down together with repeated reports that foreclosures are way up indicates two things to me. First, the foreclosure storm is brewing and we have not seen the worst of it yet; and second, we have to do something to hold mortgage brokers accountable for bad loans and we must increase resources for foreclosure prevention.”

Permits Down and Little New Construction of Single Family Homes:

New construction of privately owned housing rose by 2.3 percent in June to 1.467 million units at an annual rate. Even so, housing starts remain weak, down 19.4 percent over the last 12 months. Moreover, the June rise in total housing units started was concentrated in multi-family housing – new construction of single-family homes fell by 0.2 percent last month.

 

More ominous was the 7.5 percent plunge in permits to build new homes. That was the largest monthly decline since January 1995. Permits are now 25.2 percent below their level a year ago, reflecting continued pessimism among builders over the near-term outlook for new homebuilding.

 

Foreclosure Market Crisis and Fed’s Pilot Program:

Weakness in the housing market is largely fueled by the avalanche of mortgage foreclosures resulting from the irresponsible underwriting and deceptive lending practices in the subprime mortgage market. Foreclosures continue to rise across the nation as more and more homeowners’ loans reset to sharply higher rates. The Mortgage Bankers Association (MBA) reported that first quarter foreclosure inventory rates for subprime loans rose from 4.53 percent to 5.10 percent, or that the 2.2 million households in the subprime market that could fall victim to foreclosure over the next several years could lose as much as $164 billion, primarily in lost home equity.

 

To address the crisis, the Federal Reverse announced yesterday its plan to create a pilot program, joining the Board of Governors of the Federal Reserve with the Office of Thrift Supervision and the American Association of Residential Mortgage Regulators to conduct targeted consumer-protection compliance reviews of underwriting standards, oversight, and risk-management practice within non-depository lenders with significant subprime mortgage operations.

 

“While I welcome the Fed’s new pilot program to monitor independent subprime brokers, I don’t think consumers will be truly safe from irresponsible and deceptive lending practices until we enact tougher federal laws to prevent this mess from happening again,” Schumer said. “Sustainable home ownership is essential to the strength and stability of our nation’s economy. As indications of the weakness in housing markets continue to mount there is an urgent need for better protections for existing and aspiring homeowners”

 

Schumer Two Proposal:

Sen. Schumer has a two-step plan to address the subprime mortgage crisis. Schumer has fought for $300 million in proposed federal funds targeted to community foreclosure prevention specialists, and separate legislation to upgrade standards that mortgage brokers and originators must abide by when making new loans to borrowers. The full Senate Appropriations Committee has approved $100 million for HUD Housing Counseling programs in the Transportation, Housing and Urban Development, and Related Agencies FY08 Appropriations Bill. With these funds, non-profit agencies will be able to provide individual counseling by working one-on-one with borrowers who are in unaffordable subprime loans. This money will help stem the tide of foreclosures that are prolonging the slump in the housing market and dashing the American Dream of homeownership for too many families.

 

The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.

 

www.jec.senate.gov

 

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Jul 12 2007

Schumer Reacts to USTR Action Against China's Trade Distorting Subsidies

SCHUMER REACTS TO USTR ACTION AGAINST CHINA'S TRADE DISTORTING SUBSIDIES

Today, Sen. Charles E. Schumer (D-NY), Chairman of the Joint Economic Committee, and a member of the Senate Finance Committee, reacted to an announcement from the U.S. Trade Representative that the United States has requested the World Trade Organization to establish a dispute settlement panel to investigate possible Chinese violations of WTO rules. Specifically at issue are trade-distorting subsidy programs that favor the use of domestic products over imported products or encourage exports. China agreed to abide by the WTO Agreement on Subsidies and Countervailing Measures in December 2001 (when it joined the WTO), which prohibits such subsidies.

 

"I'm encouraged to see that the administration is moving beyond talk and into action with their request for WTO dispute settlement panel review of China's prohibited subsidies; but we must make sure the administration follows through by applying constant pressure to this process. China has gotten away with far too much, for far too long, and we can't afford to miss any opportunities to even the playing field."

 

Below is the statement from the USTR:

USTR NEWS

 

UNITED STATES TRADE REPRESENTATIVE

 

www.ustr.gov                             

Washington, D.C., 20508

202-395-3230

 

For Immediate Release:

 

July 12, 2007

 

United States Requests WTO Panel in Challenge to China's Prohibited

Subsidies

 

Washington, DC - The Office of the United States Representative announced today that the United States has requested the World Trade Organization (WTO) to establish a dispute settlement panel regarding subsidies provided by China that appear to be prohibited by WTO rules.

 

“Although our two rounds of WTO consultations with China have been constructive, they have not resolved our concerns about China’s apparent use of trade-distorting subsidies that it pledged to eliminate upon joining the World Trade Organization,” said USTR Spokesman Sean Spicer.

 

“China has taken a positive step by repealing one of the subsidy programs we challenged, but much more needs to be done. We continue to prefer a negotiated settlement to this dispute, but without assurance of complete corrective action by China, we must continue to pursue the WTO process to enforce our rights.”

 

The U.S. request for a WTO dispute settlement panel challenges several subsidy programs maintained by China that the United States believes are prohibited by WTO rules. Subsidies conditioned either on a firm's use of domestic over imported products or on exports are prohibited by the WTO Agreement on Subsidies and Countervailing Measures. They also are inconsistent with other WTO obligations, including specific commitments undertaken by China as part of its WTO accession agreement to eliminate such subsidies before it joined the WTO on December 11, 2001.

 

The United States and Mexico requested WTO consultations with China over these subsidies in February and then filed supplemental consultation requests in April after China eliminated one subsidy and passed a revised income tax law with new provisions that appear to provide for prohibited subsidies. While consultations have been productive and useful, China has not to date been able to assure the United States and Mexico that it will promptly eliminate all of the subsidy programs that remain of concern.

 

Mexico plans to join with the United States and file its own request for the establishment of a WTO panel today.

 

Background

 

The United States initiated the dispute over China's prohibited subsidies by requesting consultations with China on February 2, 2007. Mexico requested consultations with China on the same measures on February 26, 2007. Shortly before joint consultations were held on March 20, 2007, China eliminated one of the subsidy programs challenged by the United States and Mexico, but also adopted a new income tax law providing additional tax breaks for qualifying firms. In order to clarify whether these new tax breaks constituted new prohibited subsidies, the United States and Mexico requested supplemental consultations with China, which were held jointly on June 22, 2007.

 

Under WTO rules, the WTO Dispute Settlement Body (DSB) will consider the United States' request for the establishment of a panel at its next meeting on July 24, 2007. In addition to allegations under the WTO Agreement on Subsidies and Countervailing Measures and China's Protocol of Accession, the United States' complaint also alleges violations of the 1994 General Agreement on Tariffs and Trade and the Agreement on Trade-Related Investment Measures.

 

 This is the second dispute against China for which the United States has requested a WTO dispute settlement panel. The United States, together with Canada and the European Communities, requested a panel in September 2006 to examine China's regulations imposing local content requirements in the auto sector through discriminatory charges on imported auto parts. Panel proceedings in that dispute are underway.

 

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Jul 11 2007

Schumer Reacts to Bush Budget Deficit Announcement

SCHUMER REACTS TO BUSH BUDGET DEFICIT ANNOUNCEMENT

 

Today the Bush Administration announced that the projected budget deficit is $205 billion, slightly less than last year’s $248 billion budget shortfall.  U.S. Sen. Charles E. Schumer, the Chairman of the Joint Economic Committee, reacted to the administration’s forecast in light of the $5.6 trillion projected surplus President Bush inherited.

 

"The bottom line is that President Bush has pushed deficits and deficit spending to the max in the first seven years of his Administration.  Today's announcement is not proof that the Bush budget deficit is under control, in fact, it is proof-positive that it could not get any worse.  Having inherited budget surpluses in January 2001, this Administration will leave Americans trillions in debt by January 2009.”

 

  The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.

 

www.jec.senate.gov

 

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Jul 10 2007

Schumer: Eye-Popping Trade Deficit with China Made Worse by Dangerous Quality Deficit with Chinese Goods Threatening Safety and Health of Americans

SCHUMER: EYE-POPPING CHINESE TRADE

SURPLUS MADE WORSE BY DANGEROUS

QUALITY DEFICIT WITH CHINESE GOODS

THREATENING SAFETY AND HEALTH OF

AMERICANS

 

Today, U.S. Sen. Charles E. Schumer, the Chairman of the Joint Economic Committee and a member of the Senate Finance Committee, reacted to the increasing record Chinese trade surplus, nearly $27 billion for the month of June alone.

 

"Our eye-popping record trade deficit with China continues to frustrate those of us that are working to hold the Chinese government accountable, both for its misaligned currency and its faulty products and tainted foods. It is bad enough that we have a record trade deficit with China – it is even worse that there is a dangerous quality deficit threatening the safety and health of American consumers.”

 

In light of a rising tide of hazardous imports from China in recent weeks, Sen. Schumer has called for an “Import Czar” to oversee all matters pertaining to consumer protection from Chinese imports, including coordinating the efforts of more than a half dozen agencies currently charged with consumer safety related to imports.

 

Schumer, joined by Senators Max Baucus, Chuck Grassley, and Lindsey Graham, authored legislation that would force the Treasury Department to take action against countries that misalign their currencies, which would result in punitive action against China if Beijing continues to slow-walk the revaluation of the Yuan.

 

The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.

 

www.jec.senate.gov

 

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Jul 10 2007

Schumer: Execution of Chinese Chief Food and Drug Administrator Will Not Solve Greater Problems with Faulty Goods

U.S. Sen. Charles E. Schumer, the Chairman of the Joint Economic Committee and a member of the Senate Finance Committee, released the following statement in response to China's execution of its chief food and drug minister, Zheng Xiaoyu, who was found guilty of being bribed to approve untested, dangerous medicines:

 

"If China thinks that its issues with food and product safety are going to be fixed with these types of executions, it shows how much they just don’t get it. China’s surreal response to a very real problem demonstrates just how far it has to go before the U.S. can trust Chinese imports. It is increased oversight and serious inspections that will move us in the right direction."

 

Sen. Schumer has called for an “Import Czar” to oversee all matters pertaining to consumer protection from Chinese imports, including coordinating the efforts of more than a half dozen agencies currently charged with consumer safety related to imports.

 

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Jun 14 2007

Senate Democrats Show That Energy Efficient U.S. Families Spend $1,600 Less on Utilities and Gasoline, Bolster Case for Senate Energy Bill

SENATE DEMS SHOW THAT ENERGY EFFICIENT U.S. FAMILIES SPEND $1,600 LESS ON UTILITIES AND GASOLINE, BOLSTER CASE FOR SENATE ENERGY BILL

 

Joint Economic Committee Report Shows Improving Efficiency Could Save the Average Family an Estimated $750 a Year in Household Energy Costs and $875 a Year on Gasoline Costs

 

Increased Efficiency Would Also Reduce Greenhouse Gas Emissions and U.S. Dependence on Foreign Sources of Energy

 

Washington, DC: Today, the Senate Democratic leadership team released a report highlighting the energy savings potential for American families that embrace energy efficiency.  Senators Harry Reid (NV), Chuck Schumer (NY), Dick Durbin (IL), and Patty Murray (WA) of the Senate leadership will be joined by Senators Bob Casey (PA) and Amy Klobuchar (MN).   The Joint Economic Committee (JEC) report entitled, “Energy Efficiency Is a Bright Idea,” shows that families that take advantage of energy efficient practices, appliances and vehicles could save an estimated $1,600 each year in energy costs, while reducing greenhouse gas emissions, pollution, and our nation’s dependence on foreign sources of energy.  As the energy bill is debated on the Senate floor, Schumer, who chairs the JEC, initiated the report to shed light on the benefits of increasing energy and fuel efficiency to American families and the environment. 

 

Reid stated, “This report shows clearly the benefits of energy efficiency for all Americans, including savings every year in household energy and gasoline costs. Democrats are moving forward with energy legislation that will lower energy costs, strengthen our national security by reducing our dependence on oil and protect our environment by reducing global-warming emissions. Unfortunately, while Democrats fight for national and economic security, this Administration continues to be more interested in giving tax breaks to oil and gas companies even as prices have doubled and oil company profits have soared.”

 

Schumer said, “You don’t have to be Thomas Edison to know that better energy efficiency is a win-win-win for American families.   Families will save up to $1,600 on their annual energy costs, reduce U.S. dependence on foreign energy sources, and reduce greenhouse gas emissions that harm our environment.”

 

“A responsible national energy strategy must ensure that we do three things -- reduce our dependence on foreign oil and non-renewable resources; turn toward more environmentally responsible energy options and provide more efficiency so that American consumers and their families save money,” Durbin said.

 

“This report shows that the average American consumer will pay lower household energy costs and contribute less pollution and greenhouse gases by being informed and taking simple steps to conserve energy around their homes.  Reducing energy costs while ensuring that our children and grandchildren having clean air—now that’s a good deal,” Murray said.

 

Casey said, “Energy efficiency is the gift that keeps on giving – to consumers through annual cost savings, to the environment because of reduced emissions, and to our security by lowering our dependence on foreign oil.”

 

Klobuchar said, “Today we’re pushing for lights out on old, outdated, and wasteful energy products. Energy efficient technologies will lead the way to the future.  They save consumers money, help the environment, and create competition to develop the best possible products.”

 

The Joint Economic Committee report (www.jec.senate.gov) estimates that the average energy-efficient household spends approximately 40 percent less on the energy it uses than the average household that is not energy efficient.  Using data from the American Council for an Energy-Efficient Economy (ACEEE), a leading provider of energy efficiency data and analysis, the report highlights significant savings from using more efficient heating and cooling systems, ENERGY STAR household appliances, lighting, and fuel-efficient vehicles. 

 

Reducing household energy consumption also results in a decrease in emissions and reduces U.S. dependence on foreign oil. The Department of Energy estimates that the average American home emits twice as many greenhouses gases as the average car, and heating and cooling homes alone emits 150 million tons of carbon dioxide each year. According to ACEEE, energy efficient households can emit nearly 9,000 fewer pounds of CO₂ into the air each year.

 

Household Energy Costs Reduced with Efficiency Increases:

The average family spends nearly $1,900 each year on utility bills and this number will only increase as energy prices rise.  According to the U.S. Department of Energy, total residential spending on energy in 2005 was approximately $215 billion.  Some examples of how energy efficient households can cut their energy costs are highlighted below:

 

• Heating and Cooling:  Home heating currently accounts for approximately 30 percent, or about $610, of the average household’s energy costs ($270 for cooling costs). Improving efficiency in heating and cooling can save families over $500 a year in utility costs.

 

• Home Appliances account for about 30 percent of total household energy use, which currently amounts to approximately $550 per year.  A refrigerator bought in the 1970s uses 75% more energy than those on the market today; families could save about $100 a year on electricity by switching to an ENERGY STAR refrigerator and washing machine.

 

• Lighting currently accounts for about 5 to 10 percent of total energy use in the average American household, or $50 to $150 in electricity costs per year.  Replacing just five 60-watt incandescent light bulbs with 13-watt ENERGY STAR compact fluorescent light bulbs (CFLs) can save households about $30 a year in lighting expenses, assuming the lights are in use for four hours a day.

 

Gasoline Costs Reduced with Fuel-Efficient Vehicles:

Transportation is the single largest sector of consumer spending on energy, representing $475 billion in total spending in 2005 and represents 68 percent of our nation’s oil usage. 

 

A household that operates vehicles with an average fuel efficiency of 35.0 miles per gallon (mpg) can expect to spend 27 percent less on fuel than a household that operates vehicles with an average fuel efficiency of the U.S. fleet average of 25.4 mpg.  Using the Department of Energy’s gas price forecast, the average family with two vehicles driving each 14,600 miles per year a family will spend around $3,200 this year on gasoline if they drive vehicles with the fleet average of 25.4 mpg.  But a family that drives just as much, but with more efficient 35.0 mpg vehicles, would spend approximately $880 less on gasoline. 

 

The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.

 

For the full report, please go to www.jec.senate.gov.

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Jun 14 2007

Joint Economic Committee Hearing Reveals Work-Family Policies from Abroad Would Benefit U.S. Economy, Workers, and Families

WORK-FAMILY POLICIES FROM ABROAD WOULD BENEFIT U.S. ECONOMY, WORKERS, AND FAMILIES JOINT ECONOMIC COMMITTEE HEARING FINDS

 

GAO Report Released at JEC Hearing Shows U.S. Lags Far behind Other Industrial Nations in Supporting Working Families

 

Maloney, Dingell, Schumer, Reed Urged GAO to Examine Child Care, Family Leave, and Flex Time Programs in U.S. and Around the World

 

Washington, DC- The United States lags behind other industrialized nations in supporting working families, witnesses told Congresswoman Carolyn B. Maloney (D-NY), Vice-Chair of the Joint Economic Committee (JEC), today during a hearing, “Importing Success: Why Work-Family Policies from Abroad Make Economic Sense for the U.S.” The report by the Government Accountability Office (GAO) was requested jointly by Maloney, Jon Dingell (D-MI), Chairman of the House Energy and Commerce Committee, Sen. Chuck Schumer (D-NY), Chairman of the Joint Economic Committee, and Sen. Jack Reed (D-RI).

 

Maloney convened the hearing to examine the need for family-friendly work policies, such as paid family leave time, increased access to quality child care, and flexible work schedules. Stronger work-family policies in other developed countries allow more women to work, enhance employers’ profitability, and improve overall economic productivity. Family-friendly work policies also help employers recruit and retain workers, significantly reducing the costs of employee turnover and retraining.

 

“The U.S. is failing its working families. American parents work longer hours and get less time off than parents in other countries,” said Maloney. “Balanced work-family policies are a win-win – the help create stable families, a productive workforce, and positive economic outcomes.”

 

Sen. Schumer said, “If we’re going to continue to lead the world in trade and economic policies, we need to revamp sub par work-family programs here at home. The GAO report reveals a tough road for many families to balance work and family life, yet we know the right work-family balance is critical for families and the U.S. economy to protect our economic leadership.”

 

“The GAO findings show that the U.S. is behind many other countries in public and corporate policy that fosters a productive work-family relationship,” Rep. Dingell said. “Indeed, policies that balance work and family life will help our overall economy to produce workers that are compensated well, lead healthy lifestyles, and enjoy the work they do. I hope that these findings will encourage U.S. businesses, and the Congress, to create policies with our working families in mind.”

 

At today’s hearing, the Government Accountability Office (GAO) presented findings from a new report on policies used abroad to help workers – especially women – balance the competing demands of employment and care-giving responsibilities. While American families often send both parents to work and spend more time at work than parents in other countries, the U.S. lags far behind other countries in providing paid leave or flexible schedules for care-giving responsibilities.

 

Expert witnesses at today’s hearing included:

• Kay Brown, Acting Director of Education, Workforce, and Income Security, GAO
• Janet Gornick, Professor of Political Science, Baruch College, City University of New York, Director of the Luxembourg Income Study, and the co-author of Families That Work
• Ellen Bravo, Coordinator, the Multi-State Working Families Consortium, former Director of 9to5, and the author of Taking on the Big Boys
• Laura Wallace, Director of the Work Life Program, Statistical Analysis Software Co.
• Tim Kane, Director, Center for International Trade and Economics, Heritage Foundation

 

“Parents in all countries face competing demands on their time. But American families struggle more than families elsewhere – in part because American public policy offers less help to them than what’s available for working families in many other countries,” Gornick testified. “We’d do well to draw some lessons from the collective experience of many of our neighbors across the Atlantic.”

 

“Our bottom line savings from investing in our people has been estimated to be $75 million annually. In turn, those savings help improve our profitability as a company. Just as important, people represent the company’s principal and certainly most important ‘asset,’” Wallace said. 

 

 “We hear a lot of talk about family values and personal responsibility. And yet, in the United States today, being a good family member can put you job or your health

at risk,” said Bravo. “Employers can do a lot by implementing effective practices, many of which cost little or nothing and all of which strengthen the bottom line.”

 

The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.

www.jec.senate.gov

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Jun 05 2007

Momentum Builds for JEC Chairman Schumer’s Call for Additional Federal Funds to Avert Subprime Foreclosure Crisis

MOMENTUM BUILDS FOR SCHUMER’S CALL FOR ADDITIONAL FEDERAL FUNDS TO AVERT SUBPRIME FORECLOSURE CRISIS

 

In Separate Speeches, Fed Chair Bernanke and Housing Secretary Jackson Give Support for Counseling as a Way Out of Subprime Foreclosure Crisis

 

Schumer Called for $300 Million in Increased Federal Funding for HUD to Distribute to Community Groups to Bolster Counseling for Families to Aver Home Foreclosures

 

Washington, DC – Today the Chairman of the Federal Reserve Board, Ben Bernanke, endorsed the basis of a proposal made by U.S. Senator Charles E. Schumer (D-NY), the chairman of the Senate Housing Subcommittee and chairman of the Joint Economic Committee (JEC), to increase federal funds for community non-profits engaged in helping families in unsuitable subprime loans avoid losing their home to foreclosure. Yesterday, Housing and Urban Development (HUD) Secretary Alfonso Jackson made similarly supportive statements at a speech at the National Press Club.

 

Sen. Schumer said, “It is good news for homeowners and the economy that they momentum is building to boost federal funds for community groups that specialize in foreclosure prevention. In the last 24 hours, Chairman Bernanke and Secretary Jackson have given support to a proposal I made weeks ago to avert the subprime foreclosure crisis. This policy will help hundreds of thousands of families save their homes, and save billions in spillover costs from a surge in foreclosures. This seems like a cost-effective investment to me, and one that will help restore confidence in our shaky housing market. And to ensure that we don’t get into this mess again, I urge Chairman Bernanke and Secretary Jackson to join me in sealing the cracks in our regulatory system to prevent future widespread lending abuses.”

 

Chairman Bernanke gave his remarks via satellite on housing and subprime lending this morning to the International Monetary Conference in Capetown, South Africa. He endorsed housing and counseling as an effective tool for current and future homeowners. And Yesterday, Housing and Urban Development Secretary Alfonso Jackson in a speech to the National Press Club similarly endorsed non-profit counseling programs and additional federal funding for foreclosure prevention and counseling to help stem the tide of foreclosures in the subprime housing market.  

 

To enable community non-profits to successfully accommodate increasing caseloads, Schumer and other are proposing that Congress appropriate $300 million to provide to assist HUD-certified nonprofit organizations, with proven track records, in foreclosure prevention and intervention. Additional funding will allow non-profits to increase training and capacity to focus on default and foreclosure prevention counseling, to outreach to homeowners for early intervention, to improve the communications between refinances. The fund will be administered by HUD.

 

Bernanke’s relevant remarks are below:

 

“Whatever their effects on the broader economy, the problems in the subprime sector are causing real distress for many homeowners. To help mitigate the situation, the Federal Resere and other federal supervisory agencies are encouraging the banks and thrift institutions that we supervise to work with the borrowers who may be having trouble meeting their mortgage obligations, including identifying and contacting borrowers before they enter delinquency or foreclosure. Federal Reserve Banks around the country are cooperating with community and industry groups that work with borrowers and affected communities. We also continue to work with organizations that provide counseling about mortgage products to current and potential; homeowners. Studies suggest that counseling can be effective in helping borrowers make better financial decisions.

 

“In addition, we at the Federal Reserve, other regulators, and the Congress are evaluating what actions may be needed to prevent a recurrence of these problems. In deciding, we must walk a fine line: We have an obligation to prevent fraud and abusive lending; at the same time, we must tread carefully so as no to suppress responsible lending or eliminate refinancing opportunities for subprime borrowers.”

 

Jackson’s relevant remarks from yesterday are below:  

 

“...We also learned that while most people facing foreclosure are afraid of the banks, they are much more open to talking to a local non-profit counseling agency about their problems.”

 

“That’s why housing, counseling, and financing education are so important. This Administration has increased the budget for counseling over 200 percent, with the President requesting another increase, to $50 million, in the coming fiscal year.”

 

After a Joint Economic Committee report “Sheltering Neighborhoods from the Subprime Foreclosure Storm,” which found that a rise in subprime delinquencies in the early months of 2007 indicate more foreclosure trouble to come, Schumer made a proposal for $300 million in new federal funds to be directed to community non-profit groups via the Department of Housing and Urban Development to boost refinancing programs to help homeowners to avoid foreclosures.

 

Over the next two years, nearly 2 million homeowners with adjustable-rate mortgages will experience payment shocks as their loans reset in a weakening housing market, a harbinger of more foreclosures to come. Acting to prevent these foreclosures is not only important from the perspective of protecting entire communities, but it also makes good economic sense. Foreclosures can cost up to $80,000 for all stakeholders – homeowners, neighbors, cities and local governments, lenders, and loan services. Meanwhile, estimates suggest that foreclosure prevention counseling can cost as little as $1,000 per household. To be successful, these programs require one-on-one counseling with the homeowner and negotiations with a variety of stakeholders – making them very resource-intensive. The rising wave of subprime foreclosures has caused existing programs to become overwhelmed by requests for assistance, and they are struggling to give homeowners in trouble the assistance they require in order to successfully workout a suitable payment plan with the lenders.

 

The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.

www.jec.senate.gov

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Jun 01 2007

JEC Chairman Schumer Questions Bush Jobs Record, Urges Shift in Overall Economic Policy

JEC CHAIRMAN SCHUMER QUESTIONS BUSH JOBS RECORD, URGES SHIFT IN OVERALL ECONOMIC POLICY

 

President Bush Virtually Tied with Father for Worst Job Creation Record of Any U.S. President Since Hoover

 

Bush Would Have to Create Nearly 1 Million Jobs a Month to Equal Clinton’s Job Creation Record

 

Washington, DC:  Today U.S. Senator Charles E. Schumer (D-NY), the chairman of the Joint Economic Committee (JEC), responded to May’s employment figures released by the Bureau of Labor Statistics (BLS).  According to BLS the unemployment rate remained at 4.5 percent in May, 157,000 total payroll jobs were created, and job creation in March and April was revised down slightly from earlier estimates.

 

Sen. Schumer stated, “While these jobs numbers aren't as bad as expected, they're still not close to where they should be.  On balance, the disappointing patterns in recent monthly jobs reports are a drumbeat for a change in the direction of our economic, energy, and trade policies.  Even if you don’t compare the Bush administration’s job creation record with the successes of his immediate predecessor, it is still the worst since President Hoover.  The Bush administration would need to create nearly a million jobs a month to equal the gains made by the Clinton administration."

 

The Clinton administration created 22.7 million jobs, while the Bush administration has added only 5.4 million jobs so far. The Bush administration would need to create another 17 million jobs in the remainder of their term to be on par with the previous administration’s employment record.  That would require the unlikely creation of nearly a million jobs per month for the remainder of his presidency. 

 

The May Employment Report in Perspective:

Overall, there are 6.8 million unemployed Americans, and 4.9 million additional workers who want a job but are not counted among the unemployed (including about 1.4 million who have searched for work enough to be considered marginally attached to the labor force). An additional 4.5 million people work part-time for economic reasons.

 

The unemployment rate would be 8.2 percent if the figure included those who are marginally attached to the labor force and those who are forced to work part-time for economic reasons. 

 

Growth in payroll employment has been modest by the standards of past economic recoveries.  Payrolls have grown by 1.4 percent over the past year, and the 12-month pace has declined since the start of last year.  By comparison, at the same point in the 1990s recovery, 12-month growth in payrolls was 2.1 percent and rising.

 

Moreover, while the unemployment rate has come down from its peak of 6.3 percent in June 2003, May’s 4.5 percent rate is still higher than the 4 percent rate achieved in the expansion of the 1990s. 

 

Many labor market indicators remain weaker than they were at the start of the 2001 recession in March 2001. The labor force participation rate is 1.2 percentage points lower than when the recession began and the fraction of the working-age population with a job is 1.3 percentage points lower.  Long-term unemployment also persists. About one in every six unemployed people – 1.1 million Americans – have been jobless for more than 26 weeks, the maximum number of weeks for receiving regular unemployment insurance benefits.

 

The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.

 

www.jec.senate.gov

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May 31 2007

Joint Economic Committee Chair Calls Revised GDP Figures ‘Anemic’

JOINT ECONOMIC COMMITTEE CHAIR CALLS REVISED GDP FIGURES ‘ANEMIC’

 

Schumer: Anemic Growth a Wake Up Call for Major Policy Shift in Trade, National Investments, Energy, and Housing

 

0.6 Percent Growth Is Far Below 3-3.5 Percent GDP Growth Deemed Sustainable by Economists

 

Washington, DC – Today U.S. Senator Charles E. Schumer (D-NY), the chairman of the Joint Economic Committee(JEC), released the flowing statement in reaction to the Department of Commerce revised estimates that the nation’s Gross Domestic Product (GDP) grew only 0.6 percent in the first quarter of 2007. The GDP is the most comprehensive measure of our domestic production.

 

Sen. Schumer stated, “Today’s anemic GDP growth rate should serve as a wake-up call for all those who argue that this administration’s economic policies have been working. It’s time to change direction, rein in out trade deficit, and strengthen investment in innovative industry, kick our dependence on foreign oil, and bolster confidence in our housing market by stemming the tide of subprime foreclosures.”

 

The Bureau of Economic Analysis in the Department of Commerce includes more complete and more accurate first-quarter data leading to a downward revision for the GDP. The change from BEA’s earlier estimate of Q1 growth at 1.3 percent reflected a downward revision to inventory accumulation and an upward revision to imports.

 

Over the past year, the economy has grown at a 1.9 percent rate. That’s also well below the 3 – 3½ percent pace most economists believe to be sustainable over the longer run.

 

The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.

www.jec.senate.gov

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