Tag Archives: Finance

Darrell Issa stocked up on Goldman Sachs bonds while blocking investigation

Darrell Issa is back in hot water for using his powerful Congressional perch to help his personal investments. A new report out today from Think Progress finds that Issa was busy last year buying up Goldman Sachs High Yield Bonds worth up to $50,000 a pop while pressing strongly to thwart an SEC investigation into potential wrongdoing at Goldman Sachs:

Oversight Committee Chairman Rep. Darrell Issa (R-CA) raised hell last year to stop the federal government from investigating Goldman Sachs regarding allegations that the company defrauded investors. In April 2010, shortly after the Securities and Exchange Commission (SEC) announced a civil suit against Goldman Sachs, Issa sent a letter to SEC Chairwoman Mary Schapiro demanding to know if there was “any sort of prearrangement, coordination, direction from, or advance notice” between the SEC and the Obama administration or congressional Democrats over the timing of the lawsuit.

Issa’s investigation of the SEC’s investigation into Goldman Sachs stole the headlines and reinforced Goldman Sachs’ claim that they had done nothing wrong. Explaining his defense of Goldman Sachs, Issa said he was representing the views of ordinary Americans who are worried about the “growth of government and the growth of government wanting to become more complex, with more agencies and more control over our lives.”

This sheds additional light on Iss’s engagement in financial issues since taking over the Oversight Committee earlier this year, specifically reinforcing his strong resistance to any investigation or hearing that might reflect poorly on private financial institutions.

Issa has continued to bring heat on the SEC since taking over the Oversight Committee, targeting the Commission with one of the first subpoenas issued. The focus of his concern? Potential conflict of interest at the SEC arising from personal investments related to ongoing investigations. Of course.

But there’s much more…

Last month, subcommittee chair Patrick McHenry — bankrolled predominantly by the private financial industry — grilled Professor Elizabeth Warren for hours over the soon-to-launch Consumer Financial Protection Bureau, ending with McHenry accusing Professor Warren of perjury. Issa has strongly backed McHenry’s behavior, and Warren will be back to testify again on July 14th.

Issa has also targeted the bi-partisan Federal Crisis Inquiry Commission despite a miniscule budget after it assigned some blame for the financial meltdown to Wall Street.

Despite representing one of the districts hardest hit by the foreclosure crisis, Issa has consistently refused to pursue private financial institutions in his investigations into ongoing economic turmoil, and Issa had made increasingly outlandish excuses as he has refused four separate requests from ranking Democrat Elijah Cummings to issue subpoenas to major mortgage banks implicated in fraudulent foreclosure practices.

Since Issa has previously shown no compunction about personally profiting from what he does as a member of Congress, and we know that Issa prefers to stack his hearings with personal friends and campaign contributors, today’s revelations go straight to the heart of Issa’s credibility in all of these investigations and non-investigations. How can Issa conduct any investigations or hearings without an assumption that he’s seeking personal benefit before the country’s benefit?

I’m proud to manage the IssaWatch project from which this is cross-posted with light edits. You can also follow on Twitter and Facebook.

A Great First Step for Wall Street Reform

Last Saturday, I hosted three town halls in Fairfield, Antioch, and Walnut Creek, and as you can imagine, the questions ran the gamut.  But time and again, I heard from so many of my constituents about their troubles in this difficult economy. Whether it was recently laid off workers, students unsure if they can afford a 32% hike in their fees after five consecutive years of tuition hikes, laid off workers unable to collect unemployment insurance, employers who can’t acquire the capital they need to expand, or homeowners trying to save their properties from foreclosure, our people are hurting, and it’s our job in Washington to fix it.

We’re all now painfully aware that our financial sector was permitted to run amuck under the previous administration and our government failed to stop it. To address this problem, today I proudly cast my vote for H.R. 4173, the Wall Street Reform and Consumer Protection Act. While I think more expansive reforms of the financial sector are necessary, this legislation is an important first-step that will go far in helping to protect consumers, investors, homeowners, and tenants.

More over the flip…

Under this legislation, consumers will finally have a federal regulator with teeth ready to battle predatory financial firms. We will stop financial conglomerates from becoming ‘too big to fail’ and provide legal and financial assistance to homeowners and tenants trying to save their homes. For the first time in U.S. history, we will regulate the over-the-counter derivatives marketplace, where millions of contracts between large banks have gone unregulated for years. We also require most private equity and hedge fund advisors to register with the Securities and Exchange Commission and expand the SEC’s staff and anti-fraud capabilities. We also require full disclosure of financial firms’ compensation structures and give shareholders the opportunity to give an advisory vote on executive compensation practices. With millions of Americans unemployed, including tens of thousands in my district, we can’t afford further delay on this important package.

With my vote, I’m sending a simple message: no more. No more to abusive lending practices, no more to loopholes that allow billions of dollars between large firms to go unregulated, no more to a system that prioritizes short term profit in one sector over the long term health of an entire economy.

For eight years as California’s Insurance Commissioner, I regulated the largest financial industry in America: its insurance companies. Now I’m prepared to take this experience and use it to stop abusive practices in our banking industry. The games have to stop; it’s time we created an economy that focuses on the needs of Main Street, not just Wall Street.

Congressman John Garamendi (D-Walnut Creek) represents California’s 10th Congressional District. You can follow Congressman John Garamendi on his new Twitter and Facebook accounts.

California State Plan on Aging

(Thanks for the update. – promoted by Brian Leubitz)

The California State Plan on Aging estimates the population of seniors, over 85 years of age, will increase 172% over the next 20 years.  The most recent draft of the plan finds that “California’s older adult population will increase by 90 percent as members of the Baby Boomer cohort reach 60.” The Plan outlines the major areas of concern for seniors in the next four years.

EDIT By BRIAN: See the flip for more on the Plan on Aging.

The first goal of this plan is to make it easier for older Californians and their caregivers to access local information about services and programs available in their communities. One step to achieving this goal is currently underway. CalCareNetwork is being developed to provide a single searchable web site of information about home, community based and institutional long-term services.

To “enable older Californians, adults with disabilities and their caregivers to be active and supported in their homes and communities” is another stated goal of the state plan. Transportation issues are a major barrier to independence in many communities. Of note in the report is the acknowledgement that transportation planners have not worked with members of human services agencies to integrate the needs of seniors and those with disabilities.  California now has representatives from the Department of Transportation on the California Olmstead Advisory Committee to address transportation concerns from both the individual need and infrastructure perspectives. The Department of Motor Vehicles is developing a Three-Tiered Driver Assessment program. The goal is to keep drivers safely on the road for as long as possible, however this assessment could lead to more adults relying on alternative transportation.

One of the most dramatic changes to the health of seniors has been in the last century is the shift in the causes of death from infectious diseases and acute illnesses to chronic diseases and degenerative illnesses. Californians may live many years with diseases that need to be managed to maintain health. Californians have increased their use of preventive health screenings however significant racial health disparities persist in the treatment of chronic health concerns.  Alzheimer’s disease and other forms of dementia continue to be a substantial concern for individuals and their families. The third goal of the state plan is to promote the health of seniors through increased participation in health  initiatives and expanding  the availability of programs for family caregivers.  Additionally the promotion of early intervention and treatment for mental health issues is a stated goal.

The final goal is to protect the rights of older Californians through the Long-Term Care Ombudsman Program and Health Insurance Advocacy and Counseling Program (HICAP).  Updates to these programs and tools to improve communication and recognize fraud are part of the state plan.

The State Plan on Aging is clear in its anticipated funding from the state, noting: “The Department considers increases in State funding unlikely even though the population of older adults and adults with disabilities will continue to increase.” Interestingly over three pages of the State Plan draft is dedicated to the “opportunities for volunteerism and civic engagement.” This is due to the fact that many services are provided within the Aging Network through volunteers. The California Department of Aging (CDA) notes it is difficult to recruit and retain volunteers. The CDA will work to encourage increased volunteerism among older adults for their peers and those with disabilities.

It is difficult to know how anyone program will be affected when the state budget is finalized. The concerns highlighted by this report necessitate planning for the increased needs of a rapidly growing population of seniors. Current fiscal concerns are leading to reduction in services as the leading edge of the baby boomers enters the period of greatest need to age well within their communities.

While the recruitment of volunteers is beneficial for these social programs it will not be a sufficient substitute for the dollars needed for transportation, care, and health concerns of the 14.6 million seniors expected to populate California in the coming decades.  

Rep. Mike Feuer Struggles Against Medical-Error Billing

Assembly Member Feuer has authored a sensible bill with the intention of protecting consumers and it is having a tumultuous time getting passed.  AB 542 is an attempt at protecting consumers and patients from being billed for what are called “never events.”

A never event is a medical error that, frankly should never happen.  The term never event was first introduced by Ken Kizer MD, former CEO of the National Quality Forum (NQF), in reference to particularly shocking medical errors.  These adverse events are preventable, they are clearly identifiable and measurable, and they are serious – they result in death or significant disability.

Currently, operations done on the wrong body part account for most of the never events.  Other errors include dispensing the wrong medication, giving a transfusion of the wrong blood type, and leaving objects in patients.  Unfortunately, patients can still be held responsible for any charge resulting from the commission of the medical error, or actions taken to correct the error.

California passed legislation in 2006 requiring the reporting of all never events.  However hospitals and other providers are still allowed to bill patients for a treatment gone wrong and the treatments caused by their own errors.  A recent nation-wide survey found that at least half of the hospitals involved did not have policies waiving the costs incurred through a never event.  Furthermore, hospitals on average pass on to other payers 70 percent of the cost arising from the medical errors caused by negligence.

Mike Feuer proposes protecting patients as well as consumers.  Patients who have been harmed by medical errors should not be responsible for paying the bill for those errors.  Healthcare providers need to be made financially responsible for the commission of such medical errors; this will help ensure such devastating errors never occur.

Why is this bill having such a hard time passing?  It didn’t pass last year as AB 2146, and this year as AB 542 it’s seeing some opposition.  There are some inane technicalities that patients could get caught up in if the bill passes, which further illustrates how raunchy our healthcare system is.  For example, a patient reports to the Emergency Room and is found to have a sponge left inside that has eroded the biliary duct.  The patient needs to transfer to a hospital with a hepatobiliary specialist to repair this never event.  However, according to the legislation, the patient and her/his insurer cannot be billed for the services required to repair the injury. So, good luck finding a hospital that will accept the patient.

Opposers say that the bill creates precedent for a long list of never events that patients won’t have to pay for.  They are going as far as to say that a patient’s care won’t be reimbursed if they acquire C. diff colitis from antibiotic treatment. This balking is ridiculous because never events are clearly measurable, preventable medical errors that result in severe disability or death, there is no slippery slope.

Mike Feuer has worked hard on bills to oversee our long-term care facilities, regulate hospitals and protect the patients they serve.  He is a leader in the debate over health reform and has worked with advocacy groups to limit the incidence of never events.  Specifically, the Congress of California Seniors (a non-partisan private organization) has been by his side in this fight because never events devastate the health and finances of our seniors.

Mike Feuer has been a strong voice in the fight for a better safety net system to protect seniors and vulnerable families.  AB 542 is another effort to improve the health and well-being of Californians, by protecting consumers from being billed for never events.  Implementation of this bill would improve healthcare practices and protect patients by guarding them from being billed for obscene medical errors.  

How Does California Develop The State’s Budget?

Dave Johnson of Speak Out California

Last week I began to explore California’s budget, and wrote,

Our budget reflects our values. So where do we spend our money? How many Californians even know? I didn’t know so I decided to find out.

That post outlined this year’s budget, with an overview of the departments and amounts.

This week I take a look at how we in California put together our budget.  By understanding the process more of us can begin to get involved and work to ensure that the budget really does reflect our values.

As you consider the budget process and its limitations and constraints, compare it to how your own home budget operates. What do you do if you need a new car, or need to fix up your house — or just repair the roof — or provide a good education for your kids, put healthy foods on the table, and things like that.  The state isn’t really different, just bigger.

The first thing to understand about the state’s budget is that there are constraints placed on the ability to easily alter the budget to reflect the wishes of the public.  In some ways this may be wise, like requiring that the budget be balanced — just look at the massive federal borrowing ($9 trillion so far) that has resulted from politicians pandering to a public desire to avoid paying taxes.  But in other ways these constraints limit the public from truly putting their money where their values are.  A League of Women Voters (LWV) document (PDF) on the budget process describes some of these constraints:

Proposition 13 limits the amount of property tax that can be levied; Proposition 4 of 1979 limits the amount of money that the state can appropriate.

Proposition 98 requires that a minimum percentage of the total state budget be spent on K-14 education. At the same time that limits have been placed on revenue, the state’s shifting demographics have increased demand for public services.

This returns us to our comparison with your own home budget.  How would you proceed if you had a fixed amount you could spend, with an ever increasing amount of it already committed to “non-discretionary services and payments” — like rent or a mortgage and rising credit card interest?  And what if asking for a raise is pretty much ruled out, no matter how bad you might need it?

Additionally, by the way:

The law does not permit the committee or individual legislators to use public funds to keep constituents updated on items of interest unless specifically requested to do so.

So to learn how our money is being used you have to be proactive, make contact and ask questions.

The Process:

There is a summary of the budget process available on the Department of Finance website.  To summarize the summary:

California’s Constitution requires the Governor to submit a budget by January 10 each year.  If the spending in that budget exceeds estimated revenues the Governor has to recommend sources of additional funding.

The preparation of this budget is directed by the Governor’s Director of Finance, issuing guidelines to the agencies and departments.  Current department funding is used as a base.  Then a Budget Change Proposal is developed by each department to the Department of Finance for review and analysis.

As each department puts together its budget they try to work out all of the issues, with Department of Finance participation.  Issues that are unresolved or are discussed at hearings and ultimately unresolved issues are presented to the Governor for a decision.

Then the Department of Finance puts together four documents, available at their website:

Governor’s Budget Summary — A summary volume which includes the Governor’s goals and objectives for the forthcoming year, and the policy perspectives and highlights of changes in the Governor’s Budget.

Governor’s Budget — A detailed presentation for each department for the past, current, and budget years.

Governor’s Budget Highlights — A pocket size highlights book of narrative, charts and graphs issued on the Press Conference day.

Salaries and Wages Supplement — A detailed presentation of authorized staffing and related salaries.

Next, a Budget Bill is introduced in each house of the Legislature.  The Legislature then does everything they can to prevent passing any budget. (Not really, even if it seems that way. Just seeing if you’re reading.)

These Budget Bills go before the Senate Budget and Fiscal Review Committee and the Assembly Budget Committee.  The items in the bill are assigned to subcommittees, which hold hearings, usually beginning in late February.

The Legislature appoints a Legislative Analyst who presents a nonpartisan “Analysis of the Budget Bill” and recommendations for changes to the Governor’s budget plan, and testifies at the hearings.  Staff from the Department of Finance also testify at the hearings. Also at these hearings partisan consultants, lobbyists and the public may provide testimony.

By Spring the Department of Finance develops “Finance Letters” proposing adjustments to the Governor’s budget.  Then, the subcommittees report their recommendations to the Senate and Assembly committees, which vote to adopt the budget, and send them to the full Senate and Assembly.  Each are required to pass the budget by a 2/3 vote.  Should this somehow ever happen, there is a Budget Conference Committee that works out any differences between the Senate and Assembly versions, also requiring a 2/3 vote.  The final bill is sent to both houses for passage, again requiring a 2/3 vote.

The resulting bill is sent to the Governor, who can then reduce or eliminate any item.  Both houses must again vote 2/3 on that specific item to restore it to the budget.

Finally the Department of Finance publishes three documents:

California State Budget Highlights — A pocket size highlight book of narrative, charts and graphs.

Final Budget Summary — This document is an annotated version of the Budget Act which includes summary tables, technical corrections to the Budget Act, and the effect of vetoes on the items and sections of the Budget Act.

Final Change Book — This document provides the detail of changes between the January 10 budget and the enacted budget.

Often there items in the budget are that require changes to existing laws. When this happens, separate “trailer bills” bills are introduced and are heard concurrently with the Budget Bill.

The Department of Finance provides a flowchart of this process, in PDF form, here.

This process allows everyone the opportunity to know what is going on, and input on changes they want.  However, in a state as large as California there are complexities that make it difficult to track everything.

How can you keep track of items that interest you?  

Click to continue.

From a Regional Director of CDP to the Progressive Caucus and DFA NorCal

CDP Standing Committees
Posted by: “[email protected][email protected]  demcaps
Thu Mar 8, 2007 3:56 pm (PST)
Greetings Fellow Activists,

After years of work on this subject, there’s an accessible
grassroots activist on every CDP Standing Committee. If you’re a new
delegate, it may take time to learn the contacts and best process.
I’ve heard some unfair rumors about the CDP Standing Committees, so I
want to share one of my experiences.

I supported a resolution (passed in LA at the convention) to
create a plan to better fund grassroots activities. I wanted to see
how the Finance Committee might handle the resolution, so I just
showed up at a meeting and asked. Even though that was really a bit
rude of me (more polite to email the Committee Chair beforehand to
ask my question or request an agenda item), the committee took a
little time to deal with me. I then followed-up, so I know how the
Party worked with Howard Dean to create a strategy in California to
address the issue I’m so passionate about, and I understand the
process that took place to make decisions even if I don’t agree 100%.

Eric Bradley (our Party’s elected controller) heads the Finance
Committee, an important standing committee that meets at E-Boards
(not at conventions, so you’ll need to go to the next E-Board
scheduled for July in Sacramento if you want to attend a meeting in
person). As busy as Eric is, I’ve found him to be very responsive
when I have a question or when my region wants to add an item to the
Finance Committee’s agenda. I’d suggest that you email Eric ahead of
time at eric@bradley4. org.

Eric was elected because of his expertise in the financial
arena, his integrity and efficiency, but also because of his
long-standing dedication to our Party’s values. The FPPC/FEC
reporting of the Party’s money is public information, but Eric has
also implemented regular bi-yearly auditing of the Party’s finances
to make sure.

Out of respect to this dedicated Democrat, I would always contact
him first if my group had money issues. It’s always better to have
all the facts before we start criticizing, and even then, it’s
important to remember that we’re all on the same side.

In Solidarity,
Barbara Graves

Passed along by Judy Hotchkiss
Member CDP Rules Committee
CDP Rural Caucus
Amador DCC