Banks Seeking to Foreclose Face More Questions About Legal Standing

by Marian Wang, ProPublica

As we’ve noted, banks seeking to enforce foreclosures must demonstrate that they have proper documentation proving their right to enforce a foreclosure—meaning they have the legal standing to enforce the foreclosure either as the holder of the note or as an agent acting on behalf of the holder.

In bankruptcy court, this hasn’t always been easy for the banks. Over the weekend, a piece by Gretchen Morgenson of the New York Times noted that the United States Trustee Program—a Justice Department unit tasked with overseeing bankruptcy courts—has ramped up its scrutiny of banks’ foreclosure processes and is forcing banks to prove that they have the right to enforce foreclosures.

Morgenson points out two cases in federal bankruptcy court in Atlanta in which a U.S. trustee stepped in and asked bankruptcy judges to deny requests from Wells Fargo and Chase to allow them to proceed with foreclosure. In both cases, Walton filed motions saying that the bank had “failed to allege sufficient facts from which the Court can conclude that it in fact the authorized agent” of the note holder.

Issues of a note’s proper transfer and the bank’s right to enforce a foreclosure were also raised when a U.S. bankruptcy judge earlier this month rejected an attempt by Bank of America to foreclose on a New Jersey homeowner. According to a piece in Bloomberg today, the judge ruled that the bank had failed to properly transfer the note to its true owner and therefore did not have legal standing to enforce the foreclosure.

As part of that case, Bank of America employee Linda DeMartini testified [PDF] that it was standard practice for Countrywide—which was acquired by Bank of America—to sell mortgage loans without physically transferring the note to the new owner.

Countrywide “transferred the ownership, not the physical documents,” DeMartini testified, noting that the practice was “normal” for the company. The judge, in her ruling [PDF], wrote that “the fact that the owner of the note, the Bank of New York, never had possession of the note, is fatal to its enforcement," calling into question whether other cases that were similarly handled could face similar challenges.

An attorney working on behalf of the bank told Bloomberg that DeMartini had been wrong about the company’s practice:

It was the policy of Countrywide Financial Corp., acquired by Bank of America in July 2008, to deliver notes as called for in its securitization contracts, according to Larry Platt, an attorney at K&L Gates LLP in Washington designated by the bank to answer questions about the case.

“This particular employee was mistaken in what she said,” Platt said in a telephone interview.

While judges and trustees may have caught a few of such cases and tried to stop them, foreclosures without proof of standing may be surprisingly common.

University of Iowa law professor Katherine Porter analyzed bankruptcy mortgage claims in 2007 and found that about 40 percent of the time, banks didn’t provide the proper paperwork—specifically, the note—to enforce a mortgage claim and collect the debt.

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Consumer Advocates Hail Food Safety Reform

Consumer advocates who have long pushed for food safety reform are applauding the Senate's Tuesday approval of the FDA Food Safety Modernization Act, which would grant enhanced power to the Food and Drug Administration.

The Senate passed the long-stalled bill on a 73-25 vote, with many Republicans supporting the measure after supporting an earlier GOP filibuster.

“This morning, the U.S. Senate finally set aside partisan differences and passed historic legislation to protect consumers from preventable food-borne illness," says Elizabeth Hitchcock, public health advocate for the U.S. Public Interest Research Group, a Washington-based advocacy organization. “According to the Centers for Disease Control and Prevention, one in four Americans get sick, hundreds of thousands are hospitalized, and more than 5000 people die each year from eating contaminated food. It’s unacceptable that this continues in the United States in the 21st Century."

Specifically, Hitchcock says that the FDA Food Safety Modernization Act would protect consumers by:

Requiring the food manufacturers to have food-safety plans that will prevent contaminated food from reaching consumers.

Setting responsible standards for produce safety, so parents can have confidence that fresh fruits and vegetables are nutritious and safe to serve to their children.

Requiring more frequent inspections of food facilities to make sure they are following the rules.

Setting standards for imported food to end the practice by foreign producers of dumping unsafe food on the American market.

Erik Olson, director of the Pew Health Group food programs, notes that repeated disease outbreaks from contaminated foods, including eggs, lettuce, spinach, cookie dough, peanut products and so many other foods illustrate how serious foodborne disease problems continue to harm consumers, as well as the food industry's bottom line.

"This legislation will guarantee stronger rules regarding the safety of imported foods, strengthen safety standards for food facilities and provide the FDA with the power to issue a mandatory recall of contaminated food, among other authorities," Olson says. "This is crucial because the FDA is responsible for the safety of 80 percent of the nation's food supply.

Hitchcock notes that the House passed its version of a food safety bill more than a year ago. Since then, there have been more than 100 voluntary recalls of FDA regulated foods because of pathogens like salmonella and E coli.

The House now reportedly will approve the Senate version of the legislation so as to avoid a lengthy conference committee process that would reconcile differences between the two versions.

“Congress should work quickly to finalize the bill and deliver it to the President’s desk without further delay,” she says.


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With Federal Benefits Set to Expire, Unemployed Workers Face Shrinking Safety Net

by Marian Wang, ProPublica

Unless Congress acts to extend programs for those who have exhausted regular state unemployment benefits, millions of jobless workers may soon be phased out of emergency unemployment benefits.

Unemployment benefits from states typically last for 26 weeks, but since 2008, Congress has on four occasions passed emergency provisions that use federal funds to extend benefits for jobless workers by up to 73 weeks, depending on the state’s laws and unemployment rate. These benefits are set to expire tomorrow unless lawmakers intervene.

According to The Hill, a yearlong extension of federal unemployment benefits, which the White House supports, would cost an estimated $65 billion. (A New York Times editorial over the weekend noted that this would be a far smaller blow to the deficit than extending George W. Bush’s tax cuts for those making more than $250,000 annually. Not extending federal unemployment insurance, it noted, would cause 2 million unemployed workers to be cut off from federal unemployment benefits by the end of the year.)

But as we’ve reported in our examination of the unemployment insurance system, federal funds are going to the states regardless. We updated the data today, and by our calculation, 31 states have together borrowed more than $41 billion from the federal government due to shortfalls in their unemployment trust funds.

According to a congressional report released last week, more than 40 percent of jobless workers have been unemployed for at least 27 weeks—longer than the 26 weeks’ worth of benefits that some states are still borrowing to cover. Failure to extend the federal benefits, according to the bipartisan Joint Economic Committee, would result in spending more on other programs, such as disability insurance, assistance to needy families and food stamps.

Last week, House lawmakers voted on a measure to extend federal unemployment insurance by three months, but it did not pass. Benefits will begin to lapse if an extension still doesn’t pass before the deadline on Tuesday, though if lawmakers succeed in passing one later, they may grant the benefits retroactively.

For more on the state of the nation’s unemployment insurance system, check out our Unemployment Insurance Tracker to see if your state has already been borrowing to cover its share of benefits for unemployed workers.

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Citing Student Detention, University Pushes Immigration Bill

Officials from a Catholic university in Miami plan to hold a press conference on Tuesday designed to pressure lawmakers to pass legislation designed to provide legal residency status for children of illegal immigrants.

In their support for the DREAM Act, officials from St. Thomas University cite the recent detention of one of its students by the United States Border Patrol.

University officials hope their press conference will convince Americans to urge lawmakers to vote for the Development, Relief, and Education for Alien Minors Act of 2009 (DREAM ACT). The DREAM Act would provide legal status and educational opportunities to immigrant youngsters who entered the United States as minor children. The legislation applies to students in both public and private schools, including those attending Catholic schools.

The current version would provide "conditional" green cards to as many as 2.1 million people who were brought to the United States illegally by their parents when they were under the age of 16. It would allow them to work, attend college and serve in the military. It also would put them on a path to citizenship.

The DREAM Act is expected to come up for a vote this week. Although Republicans have supported the legislation in the past, they filibustered it in September when it was included as part of the larger defense authorization bill.

St. Thomas University officials cite the experience of one its students on November 19.

A member of the school's soccer team was driving independently from the team to Maine for the soccer national championships. He was stopped and detained by the Border Patrol for not having documentation for his legal presence in the United States, according to the university.

"In consultation with the University's Senior Staff and the student's family, I made the decision to assist the student in whatever way possible in an attempt to secure his release and return to Miami," says St. Thomas President Franklyn Casale. "The University sent one of the attorneys of its Human Rights Institute to Portland, Jennifer Volmar, where the student was detained. The Institute's Director, Christine Reis, has been in constant communication with Immigrations and Customs Enforcement personnel in Maine and pursued various legal options to secure his release."

The student will be granted a stay of deportation until June, when he is expected to graduate, Casale says.

The unnamed student has returned to Miami and will be present at the press conference, Casale adds. "The University also thanks Congresswoman Ileana Ros-Lehtinen for her ongoing support towards a successful outcome," he says.

The university also hopes to spur other college students to action, joining St. Thomas students' signature drive to petition Congress members to pass the Dream Act.


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New Study Shows Older, Wealthier Voters Surged to the Polls in 2010

While the 2008 electorate was the most diverse in American history, and voters gave the majority of their votes to Democrats, the 2010 midterm election experienced unusually high participation from older and wealthier voters who strongly favored Republican candidates, according to an analysis released last week by the national voting rights group Project Vote.

The analysis confirms that President Obama failed to rally key constituencies ahead of the November 2 elections in the face of greater conservative enthusiasm.

The analysis by Lorraine Minnite, an assistant professor of political science at Barnard College specializing in american politics and urban politics, shows that, while voting for the most part followed predictable historic trends for midterm elections across the country, a few distinct features of the 2010 voting population stand out that contributed to the results:

1. Across the country, senior citizens turned out in force, with the number of ballots cast by voters over 65 increasing by 16 percent. While making up only 13 percent of the U.S. resident population, Americans in this age group constituted 21 percent of 2010 voters. This age group also significantly increased their support of Republican candidates, from 49 percent in 2006 to 59 percent in 2010.

2.The number of ballots cast by Americans from households making over $200,000 a year increased by 68 percent compared to 2006.

3.Relative to 2008, minority and youth voters dropped out of the voting population at higher rates than whites, undoing much of the gain in demographic parity achieved in 2008.

4.Women—already one of the most reliable voting groups—increased their share of the electorate, and significantly increased their support of the Republican Party.

"It is fair to say that 2010 was the year of older, rich people," Minnite writes in the study.

The Minnite memo includes state-specific analysis and tables for several states, including Texas. In Texas, the total number of ballots increased at a higher rate than the national average: 13 percent, compared to five percent in national House balloting. Texas saw increases in minority voting, with both African Americans and Latinos increasing their share of the electorate over 2006 levels.

Other states, such as Nevada, bucked the national trend, and experienced higher turnout than the national average, particularly among Latino voters, a fact that no doubt helped Senate Majority Leader Harry Reid (D) hold onto his seat in his tight race against tea party favorite Sharron Angle.

Strong turnout in California, especially among minorities, also helped propel Democratic Sen. Barbara Boxer to hold her highly contested Senate seat, and a sweep of the top offices in the state, the ProjectVote survey finds.

The 2010 elections brought a historic swing in Congress, as more than 60 House Democrats lost re-election. Republicans will retake control of the House when the 112th Congress convenes in January. Democrats will continue to hold the Senate, but with a shrunken majority. The GOP also picked up six seats in the elections.

"As in most midterm elections, the people who voted in 2010 were not really representative of the American people," says Michael Slater, executive director of Project Vote. "This study raises serious questions about which constituencies candidates choose to court and engage as they look ahead to 2012, since the electorate, as a whole, is shifting away from the views and values of the older, wealthier white conservatives who dominated the 2010 election."



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Think Again: Good Journalism Is Not Free, and Somebody’s Got to Pay for It

This article was published by the Center for American Progress.

By Eric Alterman

If money is the “mother’s milk” of politics then media must be its baby food. To some conservatives the media are just another way to make money. Television was “just another household appliance, a toaster with a picture,” as Ronald Reagan’s appointed head of the Federal Communications Commission, Mark Fowler, famously described it.

More ideologically inclined right-wingers have used media as a means of movement building—one that liberals have sought to emulate. But liberals and progressives see another side of media as well. A genuinely diverse and democratic media based in communities of both concern and geography has the power to inform people of facts and evidence and enable them to form a powerful public voice to stand up to monied and other powerful interests.

John Dewey and Walter Lippmann disagreed on a great deal in their famous debate over the value and purpose of media in the formation of “public opinion” during the 1920s. But neither one doubted its importance in terms of giving everyday people the opportunity both to track their leaders’ actions and to form their own views on issues in conjunction with the other members of their communities, however defined.

Groups like Free Press, the Media Access Project, the Center for American Progress, and the New America Foundation, together with Moveon.org, have already done a good job helping to publicize—and organize—on behalf of issues related to keeping our media open for democratic communication, particularly with regard to media concentration. The danger today, however, is that questions relating to the fairness and openness of America’s “marketplace of ideas” will be buried beneath an avalanche of both jargon and apathy. The issues are growing very complicated and media companies are encountering difficulties in retaining their commitment to expensive forms of journalism at a time when the advertising base to support such forms is disappearing into the ether.

Progressives cannot afford to allow this to happen. A few foundations and university-affiliated journalism schools have made tentative contributions to filling in what were once the functions of for-profit journalism institutions. But more foundations and universities need to be encouraged to step into this breach as well and to do so quickly.

As a professor of journalism, I can tell you we are already losing many of our future Seymour Hershes and Jane Mayers to career paths that do not appear to be evaporating before our eyes. Indeed, we are losing an entire generation of them. Already, the ratio of public relations people to working journalists is close to 4-to-1—only 30 years ago it was just a little more than 1-to-1. And if you believe you are getting better, more dependable information from PR hacks than from professional journalists, I have a bridge in Brooklyn I’d like to sell you.

Meanwhile, authors Leonard Downie, Jr., and Michael Schudson report, “Fewer journalists are reporting less news in fewer pages.” According to the “State of the News Media 2010” report, “Newsrooms have shrunk by 25% in [just] the past three years.” Those that remain are now called upon to do more and more with less and less. Podcasts, videochats, blogging, and interactive engagement with readers, viewers, and listeners in comments sections all detract from the essential mission of investigation, interpretation, and synthesis for the purposes of informing and educating the larger public.

And even though some of these developments have undoubtedly been valuable in forcing an often arrogant and disconnected media establishment to respond to the everyday reality of Americans’ actual lives, the overall effect is a diminution in the foundation of public knowledge, the essential foundation of democracy.

A few highly motivated individuals and organizations have attempted to fill the gap by founding new nonprofit media organizations. These include:

• The investigative team of reporters created by Propublica, which is funded by the civic-minded billionaires Herb and Marion Sandler and headed by Paul E. Steiger, former managing editor of The Wall Street Journal
• The Center for Independent Media, headed by David Bennahum, a former writer at Wired
• The creation of a series of local-news-oriented partnerships with journalism schools like those at Columbia and the City University of New York, or CUNY, which employ faculty and students to cover stories that are no longer economically affordable for local newspapers
• Too many other small and still incipient ventures to mention

But however valuable any of these individual efforts turn out to be, they function pretty much like cocktail umbrellas in the midst of a hurricane. With the core news function of for-profit media increasingly on life support in the United States, we need to find ways to preserve investigative journalism and well-informed discourse as a public good, just like public safety and clean air, lest we be left with what Michael J. Copps, a visionary commissioner of the Federal Communications Commission, describes as “a seriously dumbed-down democratic dialogue, diminished civic engagement and the absence of meaningful public interest oversight.”

The airwaves, believe it or not, are owned by the public—not the corporations that profit from them. And yet media companies are able to reap billions from their use of the airwaves with nothing but a “postcard” process of renewal every eight years to determine whether they are even pretending to serve the public interest.

A campaign for taxpayer-funded high-quality journalism based on the model of the British Broadcasting Corporation—and recently suggested by the Leonard Downie, Jr., and Michael Schudson study published by the Columbia University School of Journalism—should not be off the table. Americans currently pay about $1.35 each in tax dollars to support noncommercial media, compared to about $25 in Canada, Australia, and Germany; nearly $60 in Japan; $80 in Britain; and more than $100 in Denmark and Finland. A similar fee in the United States would yield as much as $35 billion every year.

And the proof is in the pudding. If we compare the resources and the potential for intelligent, informative democratic debate between, say, the BBC and our own underfunded, politically cautious Corporation for Public Broadcasting, which funds the Public Broadcasting Service, it is not a pretty picture. The loss, for instance, of Bill Moyers on PBS—whose frequently fearless discussions and debates were always a source of decided discomfort to the comfortable coalition of corporate and political players who expect to dominate the news—appears to have left an irreplaceable gap in our broadcast media landscape despite the commitment of many on PBS and National Public Radio to do what they can to uphold professional standards of honesty and decency.

As the report’s authors argue:

Public radio and television should be substantially reoriented to provide significant local news reporting in every community served by public stations and their Web sites. This requires urgent action by and reform of the Corporation for Public Broadcasting, increased congressional funding and support for public media news reporting, and changes in mission and leadership for many public stations across the country.

In particular, they add:

… a national Fund for Local News should be created with money the Federal Communications Commission now collects from or could impose on telecom users, television and radio broadcast licensees, or Internet service providers and which would be administered in open competition through state Local News Fund Councils.

Many in the media in particular, but also in private industry, are understandably skeptical and even hostile to anything that smacks of government funding of media. They fear its association with totalitarian regimes and susceptibility to political pressure. But as University of Illinois professor and tireless crusader for media democracy Robert McChesney and John Nichols point out:

... we looked at the Economist magazine, and they rank every country in the world on how democratic it is and how open its governance is, how little corruption there is, how free people are, their civil liberties. ... and the top six countries they ranked as the freest, most democratic countries were just about the six heaviest press-subsidizing nations in the world. The United States ranks well below them. Then we looked at Freedom House, a conservative group whose whole mission is to monitor government censorship and harassment of private commercial media, that's its whole reason for existence, and it ranks every country in the world on how free the private press are in each of these countries every year. ... Well you go down their list of the six freest private presses in the world and they're pretty much in the six most heavy press-subsidizing nations that have those vibrant freest press systems. The United States is tied for 21st.

Government funding of media can be done because it is being done. And McChesney and others have come up with citizen-directed schemes to allocate the funds without much or any official interference.

A strong, vibrant media sector is essential despite the countless complications involved in preserving the independence and integrity of the news while simultaneously setting up fair and unbiased funding mechanisms, ensuring access to broadband communications for everyone, and enabling those without the support of megacorporations to be heard in the public sphere. Without it, the future of informed democratic debate the United States, public education on crucial issues, and grassroots organizing for citizen action is in jeopardy.

For as Walter Lippmann warned almost a century ago, “When the audience is deprived of independent access to information,” the public is left at the mercy of “the quack, the charlatan, the jingo and the terrorist.”

Eric Alterman is a Senior Fellow at the Center for American Progress and a Distinguished Professor of English at Brooklyn College. He is also a Nation columnist and a professor of journalism at the CUNY Graduate School of Journalism. His newest book, Kabuki Democracy: The System vs. Barack Obama, is available for preorder.

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Capitol Idea: Bipartisanship In The Airport Screening Line

By Scott Nance

Our nation may be caught in deeply hyperpartisan, "socialism" vs. tea-party polarization, but liberals and conservatives finally have hit on an issue able to unite them.

Left and right agree: neither side much likes the groping and "porno-scanners" found in airport security lanes.

Commentators and bloggers from across the political spectrum have taken aim at the new, intrusive airport security measures — and both sides have elevated John "Don't Touch My Junk" Tyner to folk-hero status.

It's more than a little remarkable these days when a conservative like Charles Krauthammer and a liberal such as Firedoglake blogger Jane Hamsher each leap to the defense of any one American figure as they did for the man who famously demanded airport screeners keep their hands off his privates — and videoed the encounter.

It's just as notable to watch George Will and Thom Hartmann essentially join forces against any common foe. But that's just what "grope-gate" has done.

What is it about objectionable search procedures that suddenly cause liberal and conservative voices to sing from the same hymnal?

The most immediate answer is that this problem truly is one from the grassroots. The objection to the scanners and searches sprang up suddenly from the country, not Washington. That freed commentators across the spectrum to opine as they pleased, unhindered by the set-piece talking points they usually fall back on in commenting on most other, more-established issues in order to engage in their customary point-scoring against the other side.

The larger question to ask, though, is why must this new common cause be limited only to airport security?

Why couldn't this newfound pat-down populism grow to encompass more of our national debate?

The answer is that there really is no reason at all.

The shared outrage over airport screening demonstrates common motivations on both sides in favor of such values as dignity, fair-play, and skepticism of authority.

Liberals and conservatives might find these shared ideals could well be applied across the board — to jobs, wages, consumer rights, even foreign policy and more.

We could all build on the shared airport anger we're experiencing and actually find we still have more in common than we might otherwise think.

Now, I'm not so naive as to believe peace will break out up and down Pennsylvania Ave. just because none of us like to feel violated.

We may still be Democrats, Republicans, liberals and conservatives. We will still have our differences and separate points-of-view. But, perhaps, we may get further toward solving more problems when we realize we often start from the same place.

In the end, what these hated security scanners I think will most reveal is that we are all still Americans.

Scott Nance has covered Congress and the federal government for more than a decade. Capitol Idea is his regular column from Washington. This article was first published as Bipartisanship In The Airport Screening Line on Blogcritics.



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Tea Party To Big Business: Don't Help Obama

Corporate America hasn't exactly been a predictable ally for Barack Obama and his Democratic allies. But a major force behind the tea party movement is delivering a stern message to businesses which may think of cooperating with the president: Don't you dare.

Business interests often have sided against Obama's reform agenda. Health insurance firms pushed hard against his healthcare reform plan. Banks and Wall Street executives fought intensively against his financial reform proposals. And one of the most powerful corporate lobbies in Washington, the U.S. Chamber of Commerce, successfully poured tens of millions into attack ads designed to defeat Democrats in the 2010 midterm elections.

But where corporations may see value in helping the president, a major backer of the tea party is warning them against it -- or face the wrath of conservative activists.

The National Center for Public Policy Research and FreedomWorks this week released a poll they say shows corporations risk suffering a dramatic drop in customer favorability if they support Obama's policies.

A Washington-based political organization established by major conservative donors and counting among its leadership former House Republican leader Dick Armey, FreedomWorks has provided logistical and financial resources to the tea party with a goal of using the movement as an electoral tool against Democrats.

In particular, the National Center for Public Policy Research and FreedomWorks call out General Electric and Johnson & Johnson for aiding Obama's agenda.

GE lobbied for Obama's economic stimulus plan and then received tens of millions from the economic recovery funds, and the company was a huge backer of cap-and-trade as a means of curbing greenhouse gas emissions, the organizations say in a statement. Johnson & Johnson promoted healthcare reform and cap-and-trade, they add.

These companies experienced plummeting favorability among conservatives after they were informed of the companies' lobbying efforts, the National Center for Public Policy Research and FreedomWorks say.

The drop in favorability was most severe with conservative voters active in the Tea Party movement, they add.

"For too long, big business elites have leveraged their special interest group politics to profit from the size and growth of government. The poll demonstrates that the days of easy money through backroom deals are over. Tea Party activists are willing to tackle progressive CEOs just as they tackled progressive politicians. Judging by the results of the mid-term elections, progressive CEOs should buckle up, because Tea Party activists are going to give them a very bumpy ride," says Matt Kibbe, president and CEO of FreedomWorks.

A substantial number of these consumers say this drop in favorability would influence their buying decisions, the National Center for Public Policy Research and FreedomWorks say.

Key findings about conservatives:

Favorability of General Electric fell from 51 percent to 20 percent.

Favorability of Johnson & Johnson plunged over a staggering 50 points -- from 69 percent to 16 percent.

60 percent of conservative voters said they are less likely to buy products from companies that have lobbied in favor of Obama's legislative agenda.

Key findings about Tea Party activists:

Only 28 percent of conservatives active in the Tea Party had an initial favorable opinion of GE, but this number dropped to 13 percent after these voters were informed of GE's support of Obama's policies.

60 percent of conservatives active in the Tea Party had a favorable opinion of Johnson & Johnson, but this number plunged to 8 percent after they were informed of Johnson & Johnson's support of Obama's policies.

81 percent of conservative voters active in the Tea Party are less likely to buy products from companies that have actively lobbied in favor of Obama's legislative agenda.

The poll is based on a survey of 801 conservative voters and was conducted by Wilson Research Strategies, its sponsors say.


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Race and Beyond: Scanning for Terrorists Fairly and Effectively

This article was published by the Center for American Progress.

By Sam Fulwood III

I travel a great deal on commercial airliners but I can’t remember the last time I noticed the signs at the airport warning against cracking jokes about hidden bombs in suitcases or weapons in fanny packs. Surely those bulletins are still prominently displayed at the security gates and ticket counters but I’m probably overlooking them because of the clutter of warnings about the Transportation Security Administration’s new and intrusive physical screening policies at the nation’s airports.

Federal officials say the best way for them to ferret out hidden bombs on a traveler’s person is to get intimate with them at the boarding gates. Since 2007, some airports have installed full-body scanners which make X-ray-like images of the folds and contours of the human body. But that’s not the worst of it. In some cases, when the images show something suspicious, TSA officials may use open palms to touch genitalia and other private body areas.

News reports of these new security measures brought angry reactions from some air travelers. Notably airline pilots objected, saying the security measures were unnecessary for them. Others complained the procedures went too far, lumping people deemed unlikely to be terrorists—the elderly, women with children, airline pilots, and flight crews—among those who really might be, as if anyone could really tell the difference among the multiethnic variety of terrorists willing to target innocent civilians.

And it is here, at the grounded crossroads of aviation and commerce, that civil liberties and public safety collide with government power ostensibly designed for our mutual protection. Indeed, one poll suggests that four in five Americans actually support the use of full-body airport scanners.

Of course, no one wants to be inconvenienced. Ask Secretary of State Hillary Clinton, who said Sunday on CBS’s “Face the Nation” that she wouldn’t want the TSA groping her at the airport. “Not if I could avoid it,” she said. “No. I mean, who would?”

Ah, there’s the rub. If Hillary Clinton doesn’t like it, why should I? The anger over increasingly intrusive air security policies is yet one more brick in constructing a wall separating the people from their government. The real dilemma confronting the federal transportation officials is convincing a diverse nation of Americans to trust that its government treats every one of them fairly. Any government policy or action, no matter how distasteful, can be embraced if the public deems it necessary and fairly applied to all citizens. Think taxes or military service in time of war. Americans always debate who should pay how much and who should serve, but in the end there is an acknowledged shared sacrifice, a civic responsibility, which produces greater, mutual benefits to all.

Indeed, this being America, where people are free and encouraged to complain about every inconvenience, it’s easy to find the loud voices of rabble-rousers who blame the government for any personal discomfort. Yet they want the benefits just the same. Air passenger John Tyner is the face of this dissenting crowd. His YouTube demand that government not "touch my junk" has created the catchphrase of those who feel federal authority has treaded too intimately into private parts of their lives.

But what is the alternative?

Conservative columnist Charles Krauthammer would prefer to racially or ethnically profile for suspected terrorists. Arguing against fact and reason that the types of people who would blow up an airplane are “narrow, concrete, uniquely definable and universally known,” Krauthammer equates Tyner with “Don’t Tread on Me” patriots and urges the nation to revolt against the government’s safety procedures.

As if some sort of racial, ethnic, religious, skin-tone, clothing-test profile would work in the first place. Such myopia ignores the fact that Timothy McVeigh and Ted “Unabomber” Kaczynski were home-grown terrorists who wouldn’t fit any of Krauthammer’s “narrow, concrete, uniquely definable and universally known” criteria for sorting out air passenger for likely terrorist and eligible for Uncle Sam to intimately inspect.

Don’t people like Tyner and Krauthammer expect federal transportation officials to keep them (and all the other air passengers) safe as well? Who gets to pass more comfortably through the check-in process than others?

After federal officials arrested a man with explosives concealed in his underwear last Christmas, TSA stepped up its procedures to detect whether air travelers are hiding bombs in unmentionable places. The enhanced searches have increased as the holidays approach and the airports get busier than usual. Then there’s the boosted security that followed international security agents’ discovery last month of an explosive device hidden in computer printer materials on an air cargo plane headed for Chicago.

In those known cases, the government did its job to keep the nation safe. Imagine the hue and cry of government inaction or conspiracy that would follow if any one of these had been a successful terrorist attack.

Confronted by the prospect of a stranger with a TSA badge demanding to touch me in places where no man but my doctor has gone before, the bold-type signs about not making terrorist jokes comes across as ancient and quaint. I guess that’s why they’re invisible to me.

Recalling those signs, however, makes me nostalgic for the time when a joke provoked the severest penalty on the flying public. “Who do they think they are?” I recall one exasperated libertarian air traveler muttered several pre-9/11 years ago. Like me, this fellow was seeing the sign for the first time. “This is America. We have freedom of speech. I can say or joke about anything I want.”

No longer. At least not in the airport line. The loss of that freedom now extends the reach of government to touch us in erstwhile unimaginable ways and places. In these days of suicide bombers and hidden explosives in potentially any place or person on a plane, the loss of former freedoms hides inside the price of the ticket. And if federal officials ever expect the public to go along, then everyone need to understand the costs of soaring freedoms must be borne fairly by all who choose to fly.

Sam Fulwood III is a Senior Fellow at the Center for American Progress. His work with the Center's Progress 2050 examines the impact of policies on the nation when there will be no clear racial or ethnic majority by the year 2050.

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Banks Modifying Tiny Percentage of Mortgages in Need

by Paul Kiel, ProPublica

The government’s mortgage modification program has fallen short on any number of counts. Here’s yet another: It’s failed to boost the number of modifications relative to the need.

Every month, we post a graphic rundown of the new numbers from the administration’s program. Here are the latest results, broken down by each bank or mortgage servicer participating in the program.

Have you worked for a servicer in a loan modification call center? We want to hear from you.

Are you a homeowner who's struggling to pay your mortgage? Are you seeking a loan modification through the government program? We want to hear from you.

For months, the numbers have been showing the same trend. More and more homeowners have been disqualified from the program (despite the fact that most continued to stay current on their payments). Meanwhile, fewer homeowners are entering the program.

The government’s effort is unlikely to come anywhere close to meeting the administration’s stated goals of offering help to three to four million homeowners. It also seems unlikely to spend anywhere near the full $50 billion originally set aside for the program. The number of homeowners in ongoing mortgage modifications through the program could start shrinking soon.

With the program’s reach declining, the administration has pointed to what else banks are doing to curb the problem. Banks and other companies servicing mortgages are providing far more modifications on their own: In September the ratio was more than four to one.

Earlier this month, we looked at the quality of those modifications. Although they’re better than they used to be (most used to actually raise the homeowner’s payments), the banks’ in-house modifications are on average half as generous as those the government sponsored. Homeowners in those modifications are also twice as likely to default as those with government mods.

Here’s a look at the overall number of modifications: In September of this year, servicers completed about 147,000—only about 28,000 through the government’s program and the rest outside of it, according to HOPE Now. Meanwhile, about 5.2 million mortgages were in default (60 days or more behind), according to LPS Applied Analytics. Put those two numbers together, and you get a sense for the number of modifications being done relative to the need: In September, servicers provided modifications for about 2.9 percent of the total delinquent loans.

As this chart shows, that’s about how many the industry was doing before the government’s program launched in March, 2009:

In February of 2009, the industry did about 127,000 modifications, while there were about 4.4 million delinquencies. That comes out to about 2.9 percent.

You can see a big dip in the graph that coincides with the program’s launch. That’s because servicers agreed to evaluate all homeowners for the government’s program before considering other modifications. Servicers couldn’t keep up, and a huge bottleneck resulted. They didn’t start approving significant numbers of homeowners for government-sponsored modifications until November of last year. It took servicers until this March, a year after the program’s launch, to return to their previous level. We’ve reported many times on the extended delays homeowners have suffered.

The bottom line is that for homeowners, modifications are just as rare as they were before the program launched. The absolute number of modifications is higher now than it was then, but so are the number of defaulted loans.

That doesn’t mean the rest of these mortgages have been sold through foreclosure. For the most part, loans have gone months upon months with no resolution. In January of 2009, the average mortgage in the foreclosure process had been delinquent for 319 days, according to LPS Applied Analytics. In September of this year, that number was 484. There are over 2 million loans in the foreclosure process, but there were only about 120,000 foreclosure sales in September, according to HOPE Now.

There’s likely to be a spike in foreclosures down the line unless there’s a major change. Speaking in July, Jeff Carbiener, the president of Lender Processing Services, which provides the systems many servicers use to process payments and foreclosures, told analysts on an earnings conference call that a “significant flow [of foreclosures] has to come through the pipe at some point in time.” He said there had been “some success” with modifications, but they hadn’t “taken a dent” out of the number of loans in the foreclosure process.

It remains to be seen how much of an impact the recent robo-signing scandal will have on that impending wave of foreclosures. Recently, analysts from Moody’s concluded that the problems will “cause delays rather than inability of servicers to foreclose.” The state attorneys general, meanwhile, hope to use their investigation to increase the number of modifications.

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President Obama's Approval Ratings Almost Unchanged Post-Election

With the congressional midterm elections in his rearview mirror, President Obama looks ahead to working with a Republican House of Representatives with a positive job approval rating of 38 percent and a negative rating of 62 percent. This is not much different than where his ratings stood right before the election when 37 percent of Americans gave him positive ratings and 63 percent gave him negative marks for overall job he was doing.

These are some of the results of The Harris Poll of 2,151 adults surveyed online between November 8 and 15.

While there may have been a change in control of Congress, there has not been much of a change in attitude towards it. Just over one in 10 Americans (13 percent) give Congress positive marks for the overall job they are doing while 87 percent give them negative marks. Before the election, 11 percent gave them positive marks while 89 percent gave them negative ratings.

The 2010 elections proved to be historic and game changing. In January, a new Congress will be sworn in with record numbers of freshmen. But, for the American public this is still the same old, same old. This new Congress comes in with a mandate of sorts, and the voters will be watching closely to make sure attention is paid to the issues of importance to them -– the economy and jobs, according to an analysis of the poll provided by Harris. Until those two issues are seen as moving in a positive direction, the angry voters will continue to be angry, the analysis says.

It is not surprising that over nine in 10 Republicans (93 percent) and 88 percent of conservatives give the president negative ratings. But one-third of Democrats (33 percent) and three in 10 liberals (30 percent) also give him negative marks for his job performance. Among independents, almost two-thirds (64 percent) give Obama negative ratings as do six in 10 (59 percent) moderates.

Education and region show some differences in the president's approval rating. Those in the East are more likely than those in the South to give Obama positive ratings (44 percent vs. 33 percent). Also, those with higher education are more likely to give the president positive marks on the overall job he is doing. Just three in 10 Americans with a high school degree or less (30 percent) give the president positive marks, but that rises to 40 percent of those with some college education, 45 percent of those with a college degree or online degree and 56 percent of those with a post graduate degree.

When it comes to how things in the country are going, one-third of Americans (33 percent) say things are going in the right direction while two-thirds (67 percent) say they are going off on the wrong track. Again, this is not much changed from last month when 34 percent of U.S. adults said things were going in the right direction and 66 percent said they were going off on the wrong track.
One reason for the negativity may be that the same two items again top the list of the two most important issues for the government to address. Over one-third of Americans (36 percent) say government should address employment/jobs while one-third (33 percent) say they should address the economy. Three in 10 (30 percent) say the most important issue is healthcare, while 10 percent say it is budget and government spending. Just under one in 10 say the government needs to address immigration (8 percent) and the federal budget deficit/national debt (8 percent).


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Potential Gov't Shutdown: 'The $64,000 Question'

Seemingly lost in the wrangling over President Obama's arms-control treaty and other post-election legislating is the one must-do on the agenda for the lame duck session: pass a federal budget, or face a massive government shutdown.

Congress has, as has often been the case in recent years, left undone many of the annual appropriations bills that enact levels of funding for the new fiscal year, which began on October 1. That means that lawmakers must now approve, at least, a continuing resolution to keep federal agencies operating at the same levels as the previous fiscal year.

"That is something members absolutely have to pass. If they don't, non-critical agencies will have to shut down, and we will have the first political crisis of the post-election time period," says Darrell West, vice president and director, Governance Studies, the Brookings Institution, an independent Washington think tank.

Congress last week began its current lame-duck session, following the November 2 midterm elections. Attention in the post-election session has been dominated by Obama's intense lobbying to approve his New START nuclear-reduction treaty with Russia, potential repeal of the "Don't Ask, Don't Tell" policy banning gays from serving openly in the military, and other matters.

The last shutdown of non-essential government agencies came in late 1995 and early 1996, the result of a budget showdown between then-President Bill Clinton and Republicans who controlled Congress at the time.

Republicans expected Clinton to blink, and allow massive budget cuts. He stood his ground, resulting in most federal agencies to close for days at a time.

In those days, Clinton won the war of public opinion, and his approval ratings rose to their highest levels since his 1992 election. Clinton, at the time, was helped by comments made during the crisis by Republican House Speaker Newt Gingrich, in which he complained about having to leave Air Force One by a rear door. That made the shutdown "look like the tirade of a spoiled child," in the words of former Rep. Tom DeLay (R-Texas), who was a close ally of Gingrich's at the time.

This year, however, it remains unclear whether President Obama would similarly benefit, or whether the public would side with the GOP this time.

"That is the $64,000 question. During the Clinton administration, the government shutdown clearly benefitted Clinton. Whether that happens this time depends on how each side plays their cards and how voters judge their respective efforts," West says.

West made his comments during a recent Brookings Web chat.


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Read the Latest Reports on Gulf Spill, Slamming Industry and Regulators

by Ryan Knutson, ProPublica

Earlier today, a presidential commission on the BP oil spill released two reports showing yet more evidence about how ill-equipped both the government and industry were to handle a massive spill. The technology needed to contain it lagged years behind advancements in drilling technology.

"The containment story thus contains two parallel threads," the panel wrote. "First, on April 20, the oil and gas industry was unprepared to respond to a deepwater blowout, and the federal government was similarly unprepared to provide meaningful supervision."

You can read the reports (one and two), which together tally 66 pages, in our handy doc viewer. The seven-member commission, which will give President Barack Obama a final report in January, has been active in criticizing the government, and it recently gave BP its biggest break when it said earlier this month that the company did not appear to put cost ahead of safety.

Here, too, the panel lets government regulators have it. And much of the criticism comes from interviews with employees of the Minerals Management Service (since renamed the Bureau of Ocean Energy Management, Regulation and Enforcement). From one of the reports:

"The agency viewed itself as neither capable of, nor tasked with, providing more substantive oversight. One MMS employee asserted that BP, and industry more broadly, possessed ten times the expertise that MMS could bring to bear on the enormously complex problem of deepwater containment."

One of the biggest critiques the commission cited in its reports is how the largest oil companies have invested almost nothing into clean-up technology.

"In a compressed timeframe, BP was able to design, build, and use new containment technologies, while the federal government was able to develop effective oversight capacity," one report states. "Those impressive efforts, however, were made necessary by the failure to anticipate a subsea blowout in the first place."

The commission laid out several recommendations for improvement, which the folks at the New York Times condensed into this easy-to-read list:

• Offshore operators should be required to submit detailed containment plans and prove their ability to carry them out.


• The government needs to hire and retain qualified experts to oversee future accidents.


• Government scientists should apply lessons learned from the Deepwater Horizon accident to develop better means of gauging the rate of oil and gas discharged during a spill.


• New technical means should be designed to monitor wells while they are being drilled and in the event of a blowout.


• Well designs should be modified to take into account the possibility of a catastrophic blowout.


• All deepwater operators, including companies smaller than BP and other major oil companies, should be forced to demonstrate the capacity to respond to a major disaster and clean up after it.

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Its Political Environment Prompts Call For U.S. To Stay Away From Cancun Climate Talks

The starkly divided and partisan political reality within the United States is prompting a call for the nation to stay away from global climate talks set to begin next week in Mexico. The rest of the international community should negotiate a new climate treaty without the United States, according to a U.S.-based advocacy organization.

Diplomats are to meet in Cancun to forge a new climate treaty to supplant the Kyoto Protocol, which expires in 2012.

Involvement of U.S. negotiators, however, will only be a waste of time, according to Carbonfund.org, a nonprofit climate change solutions organization.

"The U.S. has been the 800-pound gorilla in the room at climate negotiations," says Eric Carlson, president, Carbonfund.org. "As the largest global emitter per capita with enormous entourages at the meetings, all attention goes toward the U.S. Put simply, the problem is that there are not 67 votes in the U.S. Senate to ratify any climate deal the President might negotiate. It's like Lucy pulling the football away from Charlie Brown. The world needs to wise up and move the ball to a different field."

The United States agreed to the Kyoto Protocol in the 1990s under the Clinton administration, but the Senate failed to ratify the treaty. The Kyoto Protocol seeks to limit the greenhouse gas emissions that cause climate change.

President Obama is eager to regulate emissions in the United States, and his administration has been active in global climate talks since he took office in 2009. However, the president has failed to win support for domestic cap-and-trade legislation that would force a reduction in emissions domestically.

Former vice president Al Gore, who won the Nobel Peace Prize for his work on climate, also reportedly told a conference in Greece, that the United States won't enact any climate legislation for "at least two years" following Republican victories in the midterm elections this month.

Carbonfund.org says it is encouraging participating countries to extend the Kyoto Protocol, or agree on a new emissions reduction treaty without the United States.

"There are enough potential carbon buyers in the European Union, Japan, Australia and Canada and enough potential carbon sellers in China, India, Indonesia and Brazil to create a robust carbon reduction pact," says Carlson. Nearly a hundred other smaller countries could also sign onto a global pact, he says.

Carbonfund.org is calling on other countries to take action now, at a minimum by extending the term of the Kyoto protocol, or by taking steps to build on the progress of Kyoto and the voluntary carbon markets.

"We have the technical capability and market readiness to transform our global economy to one where clean energy costs less than dirty energy and efficient technology costs less than inefficient technology," says Carlson. "That is the goal."

The work of several U.S. states combating climate change is an example. The Regional Greenhouse Gas Initiative (RGGI) is a mandatory, market-based effort to reduce emissions from electricity production by 10 northeast states, including New York. California begins regulating carbon in 2012. Taken together, states with active climate programs would rank among the largest five economies of the world, Carbonfund.org notes.

"The key to solving climate change is making the market transformation from carbon-intensive fossil fuels to zero-emissions clean energy. This shift is more likely to happen if the U.S. stopped being an obstacle and stayed home from the Cancun meeting and the rest of the world stepped up and made its own deal to cut carbon emissions," says Carlson.


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Deficit Reduction Alternative 'Protects Poor, Middle-Class,' Beats Obama Targets

A liberal member of President Obama's deficit-reduction commission released an alternative plan to reign in federal red ink, a proposal she says "protects the poor and the middle-class."

Rep. Jan Schakowsky unveiled her plan last week an alternative to the proposal by the bipartisan co-chairs of the commission. The Illinois Democrat says her plan would reduce the deficit by $441 billion in 2015, surpassing Obama’s own $250 billion target.

Members of the deficit-reduction commission are to meet Tuesday to begin hammering out a deal to meet the Dec. 1 deadline imposed by the president. Unlike the plan put forward by co-chairs Erskine Bowles and Alan Simpson, Schakowsky's proposal would not cut into Social Security or other non-military domestic programs.

The independent Center for Budget and Policy Priorities, a Washington think-tank that promotes policies for low- and middle-income Americans, also says changes are needed in the Bowles-Simpson proposal, because it "does not represent a truly balanced approach."

“I am releasing my own plan today because I believe that there is a better way to achieve our goal – one that protects the poor and the middle-class," Schakowsky says. “Lower and middle class Americans did not cause the deficit.

“Just ten years ago the federal budget was generating a surplus as far as the eye could see. That surplus was turned into a deficit due to massive tax cuts – mainly to wealthy Americans; two wars paid for by borrowed money; and a major recession caused by the recklessness of the big Wall Street banks," she adds. “Over the last decade the incomes of middle class Americans have actually shrunk, while those of the wealthiest two percent of the population have exploded.

“The middle class did not benefit from the Republican economic policies that led to the current deficit –- they were the victims –- they should not be called upon to pick up the tab."

Schakowsky acheives her goals by cutting Pentagon spending, as well as farm subsidies, and raising revenue through closing loopholes, establishment of a cap-and-trade system on carbon emissions, letting the Bush-era tax cuts for the richest Americans expire at the end of this year, among other means.

Schakowsky pointedly does not put Social Security benefits under the budget knife.

“Social Security has nothing to do with the deficit. Addressing the Social Security issue as part of the deficit question is like attacking Iraq to retaliate for the 9/11 attacks – there is simply no relationship between the two and attempting to conflate them does a grave disservice to America’s seniors," she says.

“Taking money from Social Security retirees whose average total income is $18,000 per year and average benefit is $14,000 ($12,000 for women) is simply wrong," she adds. "It places them at fiscal risk and hurts the economy because they will be unable to purchase the goods they need. Americans in poll after poll have indicated their opposition to benefit cuts – particularly at a time when Wall Street bankers are making record bonuses."


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Rocky Road Ahead for DREAM Act

by Marcus Stern, ProPublica

After failing to win comprehensive immigration reform during a period when Democrats controlled both the White House and Congress, immigration proponents are now hoping to use the lame-duck session to snag an 11th-hour consolation prize: the DREAM Act.

On Tuesday, President Obama pledged to personally lobby resistant members of Congress to support the bill. But even though the DREAM Act has drawn Republican support in the past, it's unclear whether the White House can win over enough Senate Republicans to make up for the handful of Democrats who are expected to vote against the bill.

The DREAM Act has been discussed for almost a decade. The current version would provide "conditional" green cards to as many as 2.1 million people who were brought to the United States illegally by their parents when they were under the age of 16. It would allow them to work, attend college and serve in the military. It also would put them on a path to citizenship.

The House is likely to pass the DREAM Act if Speaker Nancy Pelosi, D-Calif., brings it to the floor for a vote. "No decision has been made," Pelosi spokesman Carlos Sanchez said Wednesday. But other sources close to the leadership said the only decision left to be made is what day the vote will occur.

The situation in the Senate, however, remains an uphill battle because 60 votes will be needed to block an expected Republican filibuster. Senate Majority Leader Harry Reid, who owes his narrow re-election victory earlier this month in part to Hispanic voters, has pledged to bring up the bill. Proponents don't have the votes now, but they may secure enough to produce a cliffhanger.

"I do think there's majority support in the Senate for the DREAM Act," said Lynn Tramonte, deputy director of America's Voice, which is pushing the legislation. "I think we could get over 60 votes if Republicans were part of the equation."

Rosemary Jenks of NumbersUSA, a restrictionist group that opposes the bill, said, "As far as we can tell they don't have the votes in the Senate to pass it right now. The thing that bothers me is that it would be very difficult to beat in the House, and if Pelosi were to bring it up first and pass it, I don't know what kind of effect that momentum would have in the Senate."

To get 60 votes in the Senate, proponents would need to win more than half of the 20 or so Democratic and Republican lawmakers whose votes are uncertain at this time. (Check below for a list of those whose votes are considered uncertain at this point.) Proponents believe they have 53 Democratic votes and therefore will need at least seven Republicans. Several Senate Republicans who have voted for the DREAM Act in the past are expected to oppose it this time around, including Sens. John McCain of Arizona and Orrin Hatch of Utah. Hatch had been the initial sponsor of the bill back in 2001.

The Senate has voted on the DREAM Act before. In 2007, the measure got 52 votes, falling eight short of the number needed to pass.

The president met Tuesday with congressional Hispanic leaders, who said afterward that Obama had pledged to lobby Democratic lawmakers who are wavering and Republicans who have supported the legislation in the past.

"Passage of the DREAM Act is achievable right now," Rep. Luis Gutierrez, D-Ill., said after the White House meeting. "It is the only piece of immigration reform legislation that can get broad support from Democrats and has attracted significant Republican support in the recent past."

Proponents haven't pushed for separate consideration of the DREAM Act in recent years because they feared they would lose their most compelling and attractive argument for comprehensive immigration reform, which would benefit the rest of the estimated 11 million people who are in the country illegally and who are likely to be viewed less sympathetically. The people the DREAM Act would benefit are seen as the poster boys and girls for reform. Many were brought to the United States as infants, have little or no familiarity with the countries where they were born, have grown up and come of age in the United States and are ready for college, work or military service but can't pursue any of those paths because they aren't legal residents.

The act would entitle them to six years of "conditional" legal resident status, in essence a temporary green card that could be converted to a permanent green card after six years if they satisfy certain requirements, including attending college for two years or joining the military.

In recent months young activists have pushed aside the political and strategic concerns of their pro-immigration leaders to press for the DREAM Act with or without comprehensive reform. Some held news conferences to disclose their undocumented status, daring immigration authorities to arrest and deport them, which didn't happen.

Republican gains in the recent congressional elections have made it clear to pro-immigration leaders that any chance of comprehensive reform is gone for now. So they, too, are belatedly joining the full-court press for passage of the DREAM Act by itself, calling it, as Obama did on Tuesday, a "down payment" on comprehensive immigration reform.

Proponents of the legislation say it is a matter of simple fairness to allow people brought to the country illegally by their parents when they were children to assimilate into society's mainstream. They also say it will be better for the country for these young people to be productive participants in the economy rather than stuck on the margins.

Opponents call it a backdoor amnesty, saying once the children get full permanent resident status they will be able to apply for green cards for their parents. Also, opponents say the DREAM Act's beneficiaries would be eligible for in-state tuition at colleges and universities in the states where they live, while non-resident U.S. citizen students would be paying much higher out-of-state tuition. And they question how these schools would pay for the expected higher student enrollment.

They also question the feasibility and cost of undertaking the legalization program. The exact number of people who might be eligible for conditional green cards under the DREAM Act is unknown, but estimates range from 1 million to 2.1 million.

The lame-duck session is likely to be the last chance for passing the DREAM Act anytime soon, as Republicans will take control of the House in January. Until the next round of elections in 2012, immigration proponents are likely to be playing legislative defense rather than offense on Capitol Hill.

Next year, the agenda is expected to shift from what it has been under Democrats -- exclusively passing comprehensive immigration reform -- to a drumbeat of critical hearings contending that the Obama administration is being too soft in enforcing immigration laws. The focus will likely be on tightening rather than relaxing immigration policies, including stricter border and workplace enforcement.

*

Senators whose positions on the DREAM Act are considered uncertain at this time include the following:

Democrats

• Max Baucus (Montana)


• Kay Hagan (North Carolina)


• Mary Landrieu (Louisiana)


• Joe Manchin (West Virginia)


• Claire McCaskill (Missouri)


• Ben Nelson (Nebraska)


• Mark Pryor (Arkansas)


• Jon Tester (Montana)

Republicans

• Bob Bennett (Utah)


• Scott Brown (Massachusetts)


• Sam Brownback (Kansas)


• Susan Collins (Maine)


• Lindsey Graham (South Carolina)


• Judd Gregg (New Hampshire)


• Orrin Hatch (Utah)


• George LeMieux (Florida)


• Richard Lugar (Indiana)


• John McCain (Arizona)


• Lisa Murkowski (Alaska)


• Olympia Snowe (Maine)


• George Voinovich (Ohio)

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Study Finds Racial Profiling To Limit Terror Attacks Is Fundamentally Flawed

Stop using racial profiling, says William Press from the University of Texas at Austin. He claims that as well as being politically and ethically questionable, racial profiling does no better in helping law enforcement officials in their task of catching terrorists than standard uniform random sampling techniques. This is the topic of a paper publishing in Significance, the magazine of the Royal Statistical Society and the American Statistical Association.

The concept of racial profiling as an anti-terrorism tool has gained new currency recently as anger has risen over the use of invasive pat-downs and body scanners in U.S. airports.

Racial profiling rests on the idea that people from particular racial or ethnic groups are more likely to be involved in acts of terror than people from other groups. The theory then suggests that law enforcement officers should spend a greater proportion of their time scrutinizing people from the "high risk" group. One problem with this approach is that innocent people who also belong to the targeted group rapidly become offended, and some may even become radicalized as a result.

"Racial profiling is as indiscriminate as deciding that people named Patrick are more likely to drink and drive, and so everyone who is named Patrick should be stopped and breathalyzed more frequently than people with other names," says Press.

Although it may be the case that some people named Patrick do drink and drive, he points out that there are clear problems in this profiling strategy. First, many Patricks don't drink and drive and will be unfairly detained. Secondly, this sort of profiling can have the appearance of success because if you keep testing more people named Patrick than other people, you are almost bound to find more Patricks who have drunk alcohol than people with other names. This then leads you to think the problem is even worse than you first suspected, and so you further increase the targeting of Patricks, according to the conclusions drawn by Press.

In the Significance paper Press, based in the departments of Computer Science and Integrative Biology at the University of Texas at Austin, takes a thorough mathematical and statistical view of the process that underlies racial profiling, and concludes that some forms of racial profiling may even result in a smaller chance of detaining a terrorist than carefully conducted standard sampling.

In a world threatened by terrorists from a small number of countries, it is tempting to think that racial profiling for security purposes, even if morally objectionable, might save lives. "But uniform sampling, without the use of profiling, is surprisingly good. It is robust against false assumptions, it is deterrent, it is easy to implement, it is about as effective as any real-life system can be – and it is devoid of moral and political hazard," says Press.

He believes that the choice between a strategy of profiling and one of uniform random sampling should not be viewed as difficult; uniform random sampling wins.


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SEC Investigating Citigroup Mortgage Deal

by Jake Bernstein and Jesse Eisinger, ProPublica

The Securities and Exchange Commission is investigating Citigroup's role in a $1 billion deal that the bank created in the run-up to the financial crisis. The agency is looking at whether Citi improperly pushed an independent manager to put specific assets into the deal, according to people familiar with the probe.

The deal was a collateralized debt obligation named Class V Funding III, which was completed in late February 2007. The CDO was made up of pieces of other CDOs that were themselves backed by risky slices of subprime mortgages. The deal was managed by Credit Suisse Alternative Capital, a division of the Swiss banking giant. Independent managers such as Credit Suisse were charged with picking the best assets for the CDO. Citigroup arranged and marketed the deal to investors.

Details on the investigation are sparse. The SEC declined to comment on the probe. But the SEC has been conducting a wide-ranging investigation into Wall Street's CDO business, including whether investment banks created deals in order to dump assets of declining value onto unsuspecting buyers.

Citigroup declined to discuss specifics of the deal or the investigation and repeated a statement it had previously issued: "It has been widely reported that there are ongoing industry-wide investigations into CDO-related matters, and we do not comment on pending investigations."

Among the assets purchased by Class V Funding III were portions of, or sidebets involving, at least 15 CDOs that the Illinois-based hedge fund Magnetar helped to create. Four of those CDOs were also underwritten by Citigroup. In April, ProPublica, together with Chicago Public Radio's "This American Life" and NPR's "Planet Money," detailed how Magnetar had helped create more than $40 billion worth of CDOs as part of its strategy to bet against the housing market.

Class V Funding III was cited in another ProPublica-NPR collaboration published in August. Class V bought a piece of, or had a side bet involving, two other Citi CDOs: Octonion and 888 Tactical. Those CDOs in turn purchased exposure to Class V. All three CDOs closed within about two weeks of each other. Such transactions could have helped investment banks to complete CDOs and earn deal-completion fees.

Citi hedged its exposure to the Class V CDO, persuading bond insurance company Ambac to insure $500 million of it. Eight months after Class V was completed, rating agencies downgraded the deal. Earlier this month, Ambac filed for bankruptcy, largely due to its exposure to CDOs like Class V Funding III.

It's unclear whether Citi made other trades that would pay off in the event of a drop in Class V's value. Ultimately, the bank failed to protect itself against losses from most of the CDOs it invested in; Citigroup lost almost $34 billion on its mortgage CDO business.

One hurdle for any SEC action is that banks' CDO marketing materials often included warnings about generic risks involving conflict of interests. The prospectus for Class V Funding III has such language.

A shareholder class-action lawsuit filed against Citigroup in federal court in Manhattan accused the company of using CDOs, including Class V Funding III, as a way to "clean out its warehouse" even as it downplayed the risk of its exposure to CDOs.

Last week, District Judge Sidney Stein dismissed several of the claims but allowed the case to go forward on a number of the allegations, including that Citi misstated its exposure to CDOs.

In a statement to ProPublica in response to the suit, Citi said it has "strong defenses, including the absence of any intentional or reckless misconduct, and we will continue to defend the balance of this case vigorously."


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