As more and more critical problems develop that need national attention, the White House and Congress appear to be AWOL. Who’s calling the shots instead? In this hard-hitting book, authors Morris and McGann say there are hundreds of ways American taxpayers are routinely "fleeced."
Introduction
This book is really about the far too many ways Americans are routinely fleeced by our politicians, banks, credit card companies, mortgage companies, foreign countries, and domestic corporations that are trying to set the agenda for our Congress and executive branch, and labor unions who fatten the coffers of the union treasury by luring members into questionable investments.
We’ll name the worst offenders and suggest some practical ways to turn the tide.
Here’s a good example of how credit card companies are fleecing consumers. Twenty or thirty years ago, every state had laws prohibiting usury. Only Mafia loan sharks collected interest rates of 20 or 30 percent. But Supreme Court decisions stripped the states of their power to regulate credit card interest — and the political clout of the companies has stymied congressional attempts at regulation. So while the six credit card companies that monopolize the industry post annual profits of $30 billion, tens of millions of us are chasing our tails, trying in vain to repay our credit card debt. It’s not that we owe too much: The average balance is only $13,000. It’s that we can’t repay the principal while we’re trying to keep current with the 20 to 30 percent interest. In the meantime, the credit card companies use the slightest pretext to impose penalty charges, which have tripled in the past decade.
This plastic fleece hampers our economy. It reduces our buying power and makes debtors of too many of us. But Congress won’t act because its members are on the take, receiving millions in contributions from the credit card companies — money they receive by overcharging us!
As we identified many of these critical problems that cry out for national attention, one thing became quite obvious: the White House and Congress appear to be AWOL. They’re not doing very much.
Who’s calling the shots instead? Big media, big business, big government, big labor, and big lobbyists. And their self-serving agendas are doing nothing to help the ever-increasing number of American people who are losing their homes, paying credit card interest rates higher than 25 percent, and finding their jobs increasingly outsourced to foreign countries. . . .
Where were Congress and the White House during all this?
Nowhere.
Isn’t it time for our senators and congressmen to stop fleecing us and start doing something for us, instead of spending all their time raising money for their own campaigns and patting the backs of the special interests? Is it any surprise that only 14 percent of Americans approve of the job that Congress is doing — or, that is, not doing?
Things are getting worse as they do nothing. There were 45 percent more foreclosures — at stages from the dispatch of the first foreclosure notice to bank seizure of property — in January 2008 than a year earlier. Three states led in the mortgage mess: Texas, with 14,669 foreclosures; Florida, with 10,334; and California, with 9,354.
And the foreclosures aren’t likely to stop anytime soon.
We hear a lot of concern from the presidential candidates about the mortgage crisis. They have a lot of ideas, they say. But unfortunately that’s all they are — ideas. The fact is that the three senators who dominated the race through much of 2008 — Hillary Clinton, John McCain, and Barack Obama — all but quit their day jobs in January 2007, when they announced their candidacies for president. Since then they’ve rarely shown up in the Senate, have paid little attention to their responsibilities as senators, and have done almost nothing to solve the very problems they claim to be so concerned about. All they’ve done is talk about how they’ll solve the mortgage crisis when they get to the White House. We need a lot more than just talk.
Yet, for all their absences, they haven’t completely lost contact with the Senate. Even though they don’t show up for work, they faithfully pick up their paychecks. That’s $165,000 a year — for doing nothing.
Can you imagine telling your boss that you wanted to spend your next two years campaigning full-time for a more important, higher-paying job — but you still expected to be paid for your current job, which you’d be completely ignoring?
It wouldn’t work. And it shouldn’t work for members of Congress, either. If they don’t want to do their jobs for two years, they should resign. Why on earth should the taxpayers subsidize their irresponsibility? It’s one of the reasons we feel fleeced.
It’s time for some accountability. Do your job, senators, or resign.
By the way, it’s not as if their working conditions are onerous. Apparently, Congress has never heard of the five-day work-week — or the eight-hour day. Those annoyances are for other people — not them. So far this year, they’ve scheduled votes an average of only about 1 1/2 days a week. And by days, we don’t mean anything like a normal workday. Congressional voting days sometimes last no more than a few minutes.
Nice work if you can get it.
What kind of leadership can we expect from Washington if its most prominent leaders won’t even set foot in the place? ..
If we want to avoid being fleeced in the next administration, we need our voices to be heard in November, because one thing is certain: the next election will lead to a big difference in our national policies.
It’s time to make other public officials understand that we’ll no longer be fleeced.
In our last book, “Outrage,” we identified a series of policies and events that enraged Americans. Those rip-offs were bad news, to be sure — but they weren’t part of a large pattern with international repercussions. In contrast, many of the shenanigans we address in this book are threatening to send the world into economic chaos — a crisis that could be as bad as the one Osama bin Laden triggered in 2001.
Consider the new paradigm that has developed in our capital markers: banks are begging sheiks for money. Investment banking houses are failing and being bought up for peanuts with the help of foreign investors. And the real estate market is writhing in pain and dragging down the entire economy. It’s a mess.
What caused this catastrophe? Not a war. Not even a terror attack. It was triggered by greed — simple, self-serving greed — which led the very, very rich to try to get even richer by manipulating the credit markets, government guarantees, and gullible consumers in the biggest mortgage scam in history.
There will always be enough gullible and foolishly optimistic borrowers who borrow money they can’t afford to repay. The federal government will always subsidize bad loans, either inadvertently or because of corrupt indifference. But unless those who knowingly induce consumers to sign on the dotted line face financial and criminal penalties, they’ll just keep on doing it.
We are not a nation that thrives on class warfare. Class consciousness just isn’t the American way. When a rich capitalist drives his Rolls-Royce past a factory gate in Britain, the workers think, “That’s not right.“ An American worker, on the other hand, would be more likely to think, “My boy will have a Rolls like that someday.“ But the obscene gluttony we’ve seen in CEOs’ pay and bonuses could light the fires of class warfare within our borders if this kind of thing isn’t stopped.
In his biography of Andrew Jackson, Sean Wilentz articulated the essence of the heritage of democracy in America. You can’t make all people equal, he argued. Some will always be brighter, prettier, healthier, or more energetic than others. But you can eliminate the kinds of artificial inequality that are created by government favoritism.
It’s time we got serious about that task. Hedge fund managers, for example, are among the richest people in our country. George Soros made more than $3 billion last year. The hedge fund managers defend their salaries by pointing to the risks they took, the smart investments they made, and how hard they worked. But, even so, their income is taxed at only 15 percent because they dress up their earnings as capital gains, while everyone else has to pay up to 35 percent in taxes. That’s what Wilentz means by artificial inequality — and it has to end.
Why hasn’t it ended already? Why didn’t the Democratic Congress that swept into office in 2006 put a halt to it? Because the Democrats won’t close the loophole. They say it’s because hedge funds are an important New York industry. But we suspect that it’s really because the party receives two thirds of all campaign contributions that come from hedge fund managers.
John McCain is famous for attacking lobbyists and their influence peddling, and he has refused their donations. Hillary Clinton greedily grabs every lobbyist campaign contribution she can. But the two candidates have something in common: both have close advisers, at the very top of their campaigns, who are tied — directly or indirectly — to lobbying firms for EADS, the European company that owns the aviation giant Airbus. Airbus recently sought funds from the U.S. Department of Defense — yes, that’s right, American tax money — to build new tanker aircraft. The contract it was after was worth at least $40 billion and potentially up to $100 billion — and the U.S. firm Boeing and the state of Washington had been counting on that contract. But the the rug was pulled out from under them by the lobbying firms that helped secure the contract for Airbus — the same firms that are connected with Clinton’s and McCain’s campaign advisers.
And what of the young men and women who risk their lives to capture or kill terrorists before they can strike us? The heroism of these young men and women has led to the capture of 765 terrorists who have been sent to Guantánamo Naval Base to be locked up until the war on terror is over. But courts, liberal lawyers, and a cowed administration have released 425 of these anti-American militants. And now we’re having to go out and recapture many of them —or kill them — because, thanks to our leniency, they’re back in the field fighting us again!
So “Fleeced” is dedicated to finding the culprits, exposing their deeds, and crafting remedies. As with “Outrage,” we do so with the realization that knowledge can empower citizens to force change. When the lights come on, the cockroaches scurry for cover. Read this book and get out the roach spray!
Excerpt from the book "Fleeced" by Dick Morris and Eileen McGann. Copyright © 2008 by Dick Morris & Eileen McGann. Reprinted by permission of HarperCollins Publishers