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Political Report to the United Front Against Austerity: Page 7 of 9

Student Loan Amnesty

Students and young people are being crushed by a burden of $1 trillion in student loan debt. This debt is illegitimate, since it reflects the success of US corporations in making working families pay to train the labor whose economic benefits will then be harvested by these firms. Student loan debt is now interfering with the normal progression of human life itself. This makes it less and less possible for young people to secure an apartment of their own, to get married, have children, and to pursue advanced degrees or professional training. Even Defense Secretary Panetta is now complaining that the fear of student loan debt now looms larger than the stress of combat for military personnel. Here is a classic example where the demands of debt collide head-on with the demands of human society.

We demand an immediate comprehensive student loan freeze, meaning a total halt to all payments on interest and principal for at least five years or for the duration of the world economic depression, whichever lasts longer. At the end of this time, the issue of his student loan debt can be re-examined, with a view to instituting a complete amnesty or cancellation. A provision of this type should have been instituted in the Bush-Obama TARP legislation, and should have been made a precondition for financial institutions drawing on the $26 trillion, 0% interest line of credit made available by the Federal Reserve. The student loan amnesty can therefore be considered as Wall Street’s thank you for the younger generation.

Stop All Foreclosures

Another area where the machinery of debt collection is interfering more and more with the requirements of human life and human society is the foreclosure crisis. Three to four million American families are being kicked out of their homes each year by the zombie bankers as a result of a financial panic created not by subprime mortgages, but rather by the Collateralized Debt Obligations and Credit Default Swaps which were permitted on top of these mortgages by the bankers themselves. These subprime mortgages with a result of fraudulent marketing, and the foreclosures frequently involve robo-signers, robo-judges, and other obvious political corruption, which the Obama-Holder Justice Department is eager to ignore.

New Frazier-Lemke Act

The only answer to this chaotic situation is an immediate and uniform federal law outlawing all foreclosures on primary residences for five years or the duration of the depression, which ever lasts longer. The model should be the Frazier-Lemke Act of 1934, which prevented banks from foreclosing on homes and farms if the owner could get a payment plan agreed to by any court at any level. This is another requirement which should have been built into the TARP, and which also should have been attached to the cheap federal credit made available by the Federal Reserve to financial institutions. As for the Collateralized Debt Obligations and Credit Default Swaps, there is a growing consensus that these extremely dangerous forms of derivatives need to be outlawed.

Medicare for All

About 50 million Americans currently have no health insurance, and many of them have no access to medical care. All Americans must immediately be given access to the Medicare program, one of the most successful federal programs of all time, which has been instrumental in lowering the levels of morbidity and mortality among senior citizens, thereby saving and prolonging millions upon millions of lives. Those who can afford to pay can contribute $100 a month towards this coverage, which is comparable to the current fee. Those who are unemployed or destitute must be given free access, with no person turned away.

The terminology of Medicare for All is decisive. Very few people understand the slogan of single-payer, and even fewer know the difference between single-payer and the public option, whatever the latter might be. But the vast majority of the American people can immediately understand Medicare for All, reflecting the broad popularity of this program which three quarters to four fifths of Americans do not want to see cut.

Obamacare is largely concerned with bailing out insurance companies bankrupted by their own derivative speculation through ensuring them a permanent cash flow. The most sinister feature of Obamacare is the rationing board which decides which life-saving technologies can be used and who is to be excluded. The only way a civilized nation can save money on health care is by finding cures to heart disease, cancer, Alzheimer’s, and other dread diseases. This requires a massive investment in biomedical research, meaning an effort on the scale of the Manhattan Project in World War II. As diseases are cured, costs can be humanely reduced. In order to guarantee that medical care will be available, the United States will need to train approximately 250,000 doctors and specialists over the next few years. We will also need to build about 1,000 modern hospitals to replace the ones shut down by privatizers and looters over the last quarter-century.

Jobless Benefits for 99ers and Beyond

Wall Street is responsible for this depression, and not American working people. Unemployment benefits represent an economic right, and must not be reduced in the way that Obama and the reactionary Republicans have been colluding to do. Those who have exhausted their unemployment benefits, including the so-called 99ers, must be given immediate assistance. Unemployment benefits must be made open ended, for the duration of the current depression.

10% National Usury Law

American working families are currently crushed by over $1 trillion of high interest consumer and credit card debt. Before the tenure of Paul Adolf Volcker at the Federal Reserve during the Carter and Reagan administrations, most states had usury laws which limited interest payments to 10% per year. Those laws were phased out because of Volcker’s 21% prime rate. This has resulted in the current plague of high interest payday lenders who prey upon the most vulnerable working people. We urgently require a federal law to put a 10% ceiling on all interest rates. If necessary, this can be implemented under the Defense Production Act and motivated by the current multiple national emergencies.

Minimum Wage and Living Wage

By reducing the amount of national income absorbed by high-interest speculation, resources will become available to begin raising the standard of living of the American people. The federal minimum wage, at its highest point in 1968, reached the equivalent of about $11 in today’s money. Obama has done nothing on this front, including when he had a Democratic majority in Congress. Accordingly, it is time to raise the federal minimum wage from the current $7.25 per hour to $11, as a first step towards further increases in the near future.

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