USE COMMON SENSE: Why would anyone do that? Most consumers are in a new class of disabled Americans.

I have long believed that the reason why Hillary Rodham Clinton became radioactive consisted of two things: first was the popularity of Ronald Reagan who hated a program that started with bipartisan consensus in 1971. It was called the Legal Services Corporation. The LSC was an obviously needed program to provide access to legal services to those who would otherwise be unable to receive it. That was when Republicans like Nixon and Democrats like Kennedy all believed in the same basic premise: the role of government was to keep the playing field level and mitigate the inevitable tilting of the playing field in favor of successful people.

The general premise behind it was the same as the necessity of providing criminal defendants with a defense attorney. Reagan’s hatred of this program was buttressed by his political popularity, which in turn was supported by the business community, who viewed economically disadvantaged people as food. And they didn’t want anything to interfere with their food supply.

All of that was based upon a simple premise that is generally understood and accepted by all political spectrums: the lower the income and wealth of an individual, the more likely it is that they will spend every penny they can lay their hands on whether in the form of wages, loan, gift, or anything else. This was virtually glorified by the ascent of the payroll advance “lenders.”

Contrary to what everyone thought and believed, the average income of the person who used a payday advance financial product was around $56,000 20 years ago. By most economic metrics, that equates to at least $68,000 now.

These are the people who literally live paycheck to paycheck and still can’t quite make it. So when they are confronted with improper or false claims asserting the right to administer, collect or enforce money they allegedly owe, they are on their own. The LSC was designed to help at least the lower rungs of this class.

Hillary Clinton was a highly effective leader and promoter of the LSC. When the wind was at her back, she increased funding geometrically and provided highly effective representation to people who would otherwise have been unable to obtain legal services. But perhaps more importantly, these are the people who were most likely deprived of sufficient education even to know that they had rights and that those rights were being violated. The political opposition to the LSC and the political opposition to the healthcare reform proposed by Hillary Clinton in the early years of the Bill Clinton administration made her the target of disgust and hatred, mostly by people who have no idea that she had been working effectively for them and not against them.

Congress was all revved by the republican revolution led by Newt Gingrich. They steadfastly sought and passed measures that restricted the ability of the LSC to function, while Democrats were not so steadfast in opposing those efforts. Republicans were able to paint Hillary as ineffective and “entitled”. At the same time, she and her allies failed to defend against that portrayal. They failed to seize the opportunity to paint the Republican opposition as the party opposing rights for the average American, curating the dominance of big businesses that wanted to feed on those Americans.

The second reason is that she remains radioactive because she failed to market her leadership skills effectively. The “scandals” thrown at her by partisans were not why she lost the 2016 election. I’ll concede that the rollout of her plan for healthcare reform was less than appealing. But it was doomed before it started. Americans had been brainwashed that health benefits through an employer were a good thing and were convinced that the loss of those “benefits” would leave them without health care coverage.

The message that health care would have become more accessible and less expensive was completely lost in the PR wars between the financial industry and big Pharma on one hand and a small unfunded and understaffed vocal minority of people seeking reform.

But that was not the end of it. We all know that eventually, Healthcare reform was, in fact, passed in the Affordable Care Act. And various groups have emerged on statewide and local levels to bring affordable and accessible legal services on issues affecting wide swaths of the population. Some of those focus particularly on the class of citizens who are above the poverty line but, as I stated above, were completely unable to defend improper or illegal claims.

These claims were asserted and pursued to terrorize people into making payments to stop the claim, regardless of whether any legal obligation existed. One such group is the successful non-profit Southern Legal Counsel organization ( operating in Florida.

Established in 1977 — the year I was admitted to the Florida Bar association — and supported by donations and grants, this organization has had many victories, large and small, that favored the consumers who consistently entered into “agreements” without knowing the terms or who were victims of breaches of those agreements.  It is also supported by dozens of law firms who pledge pro bono hours to assist in worthy causes.

So to get the point of this article (besides stirring up debate about Hillary and Healthcare), there is no greater challenge or need for consumers on the lower economic scale than protection from dubious financial products that they do not understand — and which lawyers do not understand because they were not schooled in accounting or auditing. Virtually all of these people are “disabled Americans.” They were disabled by education withheld so they could not possibly understand that they were being lured into “contracts” that only imitated consent.

If you want to know why we have so many vacancies in teacher positions (9500 in Florida), it is because we don’t pay enough to enable them to pursue their dream of teaching — and we make them pay for their own supplies. Next, we will make bus drivers buy their own transportation and buy their own fuel. The initial premise of public education is in the process of being buried — to create thinking, knowledgeable citizens who make up their minds based upon all available relevant information.

Go to any law office or courtroom today, and the opinion will be the equivalent of caveat emptor despite specific statutes and case law to the contrary. The idea that the deal isn’t a loan and was never meant to be a loan by the scheme’s promoters is dismissed as absurd. So let me ask a single question:

Virtualy every installment payment offering today contains low or noninterest for years and low or no payments for at least one year. With interest rates still near historic lows, there is no possible way to make money on that deal if you are the source of funds. So here is the question: why would anyone do that?

The answer is obvious: they are making boatloads of money offering “loans” for what appears to be no payments or small payments. The actual collection from consumers is not nearly as important as getting their signature. It is their signature that is being sold and securitized, not any debt. And all such deals are securitized.

What is the harm? Consumers who depend upon market forces correcting unconscionable and stupid deals are counting on a nonexistent option. Incporated into every American contract is the duty of fair dealing and honesty. Incorporated into every American contract that labels itself as a “loan” is the risk of loss to the vendor of that financial product. That is the self-regulating mechanism that is assumed by consumers, lawyers and judges. But since securitization began its ascent in the 1990s, that risk of loss has been missing completely.

There is no free market nor any free market forces. The vendors of these deals have absolutely no risk of loss on the illusory loan account because the underlying debt either does not exist or had been eliminated trhough the sales of unregulated securities — the proceeds of which are not reported as related to the consuemr transaction that produced the sale. .

Instead there is a pot of revenue and profits that are not reported to consumers, the lawyers or the courts and never credited to an unpaid loan account because everyone was paid at the outset. The money they coerce from consumers is merely gravy on a dish that has already served and satsified dozens of appetites.

The point was not just profit but also the elimination of any possibiity of a reported loss on the financial or accounting ledgers of any company. Thisincludes the company that has been designated by third aprties on behalf of fourth parties as “creditor” for purposes of coerced collction and enforcement of nonexistent debt.

All this is done without any acknowledgement or warranty of the existence and status of the underlying claimed obligation by the company whose name is used and abused (with permission, for a license fee) for purposes of collection and enforcement.

Consumers basically have no access to proper legal services because of two factors. First they have been deprived of education, depriving them of the means to function in a complex financial and legal world. And most would say that they have even been brainwashed about the need for legal services since the alleged delinquent payment is due on a legal debt. Second, even if they knew their rights and even if they knew that their rights were being violated, the cost of legal representation makes it impossible for them to properly defend or contest improper or illegal claims.

The financial community, through a variety of misleading financial products, as adopted business plans that target people of lower education, low income, and any other attributes that could be interfering with the ability to understand or question the terms of a transaction. In my view, the lack of education throughout the school curriculum and into college and postgraduate studies, has created a class of disabled consumers.

Those people have no basis or experience even knowing what questions to ask. The existence of laws requiring disclosure to them, a violation of those laws, and the remedies for violating them are completely unknown. It is up to state and local nonprofit legal services organizations to fill this gap. In doing so they will be correcting a marketplace that is essentially closed, dominated, and controlled by three or four banks, whose impact is felt worldwide. Trillions of dollars have been siphoned from the economies of this country and other countries through this scheme. It is time to tilt the playing field back toward “level.”

The recent renewal of efforts by the department of justice to enforce antitrust legislation that has existed for more than 100 years is a helpful step toward creating conditions that will favor a marketplace in which free market forces can operate. But without active litigation on behalf of those on the financial community who cannot defend baseless claims, it will take much longer to bring back equal opportunity and justice.




2 Responses

  1. Well put Poppy. To add, the financial crisis began with the Community Reinvestment Act (CRA) and, at the same time, deregulation and pilot program by SEC – Regulation AB for private label securities, which was never complied with – hence explosion. The CRA had good intentions, but there was no regulation and it went haywire. In effect, the CRA and PLMBS saddled low/middle income with high adjustable interest rates while others enjoyed low rates. It was a recipe for disaster. At the same time, given bad trade agreements – good paying and secure jobs were going overseas, and we were left with services to fuel consumption – which is always the goal of governments. Never enough when we produce nothing the rest of world wants. Only WS exports its “services.” Better to export that then keep it here. The reliance on other countries is finally backfiring. The ramifications of all this continues to exist today, and the fraud remains buried. No legal aid formation is capable of undoing (nor will they) what the government has done for decades.

  2. “keep the playing field level and mitigate the inevitable titling of the playing field, in favor of successful people”…
    Wow, that is quite a statement, given most “successful” people have worked harder, spent more money on educating themselves, networked and in some cases ground in menial jobs they hated, to get the needed experience to pull themselves up.
    And Clinton, what a character. Painting her as an altruistic, is quite a stretch. No debate there, IMHO
    As far as being “deprived” an education, I beg to differ. Sticking my neck out here: reading materials are everywhere. Getting a legal education doesn’t begin in a highly overpriced Law School. That’s the basics…and for my opinion, most lawyers have no earthly idea how to handle these financial products or many of the cases they get paid to defend, hence the reason for so many plea deals. Many of them are hustlers, snake oil salesmen.
    As far as “healthcare”, it is nothing more than symptom care, in my observation. I have some medical training and been a caregiver multiple times. You can see what’s happened-happening. Big pharma and corporations have “infested” medical care. Most doctors have zero authority to go out of the box and use their skills, training to find the root cause of a problem. Medical treatment is all coded, monitored, controlled and much of it, cookie cutter.
    I could go on and on, with my opinion, but no one really cares and will argue the point. I cannot unsee, what I have seen and I, was a high school dropout, a total renegade, growing up. At a point, it became obvious to me, I needed to help myself and stop being a victim of my own ignorance. Then and only then, did I hit the gas and now hold numerous accolades in the fitness industry, owned several small businesses, hold multiple degrees, to include an MBA-Magna Cumme Laude, completed in my forties.
    Even though there are a lot of industry movers who victimize people, one MUST be aware, educate yourself about many things. No one said life was easy…look at this market right now. Overpaying is the norm. You can never get past overpaying. You have put yourself, in the line of fire.

Contribute to the discussion!

%d bloggers like this: