Democrats are building an economic approach that lifts every American, not just the privileged few. The average American CEO earns more before lunchtime in one day than a minimum wage worker earns all year. This is not the kind of America we want our children to grow up in. Today's economic challenges result from years of Republican inaction and failed policies that have left more and more Americans behind.
It is time to rebuild our economy in a way that's consistent with our values - an economy that rewards hard work and responsibility, not high-flying finance schemes; an economy that's built on a stable foundation, not propelled by overheated housing markets and maxed-out credit cards. We want to build an economy that offers broadly shared prosperity for the long run.
In the 111th Congress, we passed and President Obama signed the American Recovery and Reinvestment Act into law. This bill will save and create jobs, get our economy moving again, and transform it for long-term growth and stability.
As a result of the Democratic-led Congress's focus on economic recovery and on job creation, millions of American workers have gotten a pay raise. The minimum wage increase has gone into effect, putting more money into workers' pockets to help them cope with rising costs, benefiting more than 12 million workers.
This is a time for bold, bipartisan action because Americans who are losing their jobs, homes and health care cannot afford wait.
Congress will continue to work with President Obama in taking aggressive action to create and save jobs while investing in clean energy, education, and affordable health care to ensure a full economic recovery that will last for generations to come.
Credit Cardholders' Bill of Rights
On May 20th, the House passed the final version of the Credit Cardholders' Bill of Rights, H.R. 627 and the President signed the bill into law on May 22nd.
The Credit Cardholders' Bill of Rights will give consumers the rights and information they need to make educated decisions about their financial lives and could save some families thousands of dollars.
This legislation will apply common-sense regulations that would ban unfair rate increases and forbid abusive fees and penalties. For example, it will prohibit retroactive interest rate hikes on existing balances, double-cycle billing (charging interest twice for balances paid on time), and due-date gimmicks. It will also require 45-days' advance notice of interest rate, fees, and finance charges hikes, require payments to be applied fairly to the highest interest rate balance first, and strengthen credit card protections for young people.
It mandates greater transparency to give consumers clear information, such as requiring credit cards to post their agreements online, and holds those responsible who engage in deceptive practices that hurt families and consumers, by beefing up monitoring, enforcement, and penalties for violations of the law.
Fighting Pay Discrimination
The Lilly Ledbetter Fair Pay Act
In January of 2009, the House passed the Lilly Ledbetter Fair Pay Act, which provides a remedy for women and men who have been victims of pay discrimination. President Obama signed this bill into law on January 29. The Lilly Ledbetter Fair Pay Act corrects the Supreme Court decision that severely restricted the right of workers to have their day in court. The bill was passed by the House in the 110th Congress, but unfortunately Republicans in the Senate blocked a vote on this legislation, thwarting efforts to allow victims of wage discrimination to seek justice in the courts. Women still make just 78 cents to each man's dollar, and in an uncertain economy, equal pay for equal work is about daily survival for millions.
Paycheck Fairness Act
On January 9th 2009, the House passed the Paycheck Fairness Act, which was passed by the House in the 110th Congress but never taken up by the Senate. This bill would strengthen the Equal Pay Act of 1963 by providing more effective remedies to women who are not being paid equal wages for doing equal work.
The bill would also prohibit employers from retaliating against employees who share salary information with their co-workers; require the Department of Labor to enhance outreach and training efforts to work with employers to eliminate pay disparities; and create a new grant program to help strengthen the negotiation skills of girls and women.
Raising the Minimum Wage
The Democratic-led Congress passed the first pay raise for working Americans in a decade. The previous Republican-controlled Congresses blocked minimum wage proposals from being considered. In 2006 alone, Republicans blocked minimum wage legislation from coming to a vote 11 times.
It is wrong to have millions of Americans working full-time and year-round, yet still living in poverty. The previous minimum wage of $5.15 an hour was simply not enough to cover the needs of the average family as they struggle with increasing costs of child care, education, health insurance, and gasoline prices. Before the increase in 2007, the value of the minimum wage had dropped to its lowest level in over half a century. Working full time, a minimum wage worker brought home only $10,712 a year, nearly $6,000 below the poverty level for a family of three. Raising the minimum wage in 2007 meant a $4,400 yearly pay raise--money that could pay for 15 months of groceries, or more than two years of health care. It could buy 19 months of utilities, 20 months of child care, or 30 months of college tuition at a public, 2-year college.
Mortgage Reform and Anti-Predatory Lending Act
On May 7th, 2009, the House passed the Mortgage Reform and Anti-Predatory Lending Act, H.R. 1728. The bill responds to the subprime mortgage crisis by instituting much needed reform to prevent these bad loans from being made in the first place. It stops the kinds of predatory and irresponsible mortgage loan practices that played a major role in the current financial and economic meltdown and prevents borrowers from deliberately misstating their income to qualify for a loan.
These long overdue reforms, which Democrats have been advocating since 1999, perhaps could have prevented the current crisis.
To restore the integrity of mortgage lending industry, this bill will make sure that the mortgage industry follows basic principles of sound lending, responsibility, and consumer protection, ensuring that:
- borrowers can repay the loans they are sold;
- mortgage lenders make loans that benefit the consumer and prohibit them from steering borrowers into higher cost loans;
- all mortgage refinancing provides a net tangible benefit to the consumer;
- the secondary mortgage market, for the first time ever, is responsible for complying with these common sense standards when they buy loans and turn them into securities;
- there are incentives for the mortgage market to move back toward making safe, fully documented loans; and
- tenants renting homes that are foreclosed would receive notification and time to relocate.
Helping Families Save Their Homes
On May 20th, 2009 the President signed the Helping Families Save Their Homes Act into law. The Helping Families Save Their Homes Act(S.896) builds on the President's housing initiative, to provide significant incentives to lenders, servicers, and homeowners to work together to modify loans and to avoid foreclosures, which cost families their homes every 13 seconds in America. Unfortunately, due to Senate opposition, the bill does not include bankruptcy provisions included in the House bill that encourage lenders to modify loans for families in danger of losing their homes. House Democrats will continue to fight for these provisions to allow judges in the court of last resort to modify the terms of mortgage loans for families-just as they currently do for investors in vacation homes, real estate speculators, and corporations.
This legislation provides tooks to modify loans and avoid foreclosures by:
- Protecting lenders from frivolous lawsuits when they make loan modifications consistent with the Obama Administration's program or done through the Hope for Homeowners program;
- Reducing the current fees for homeowners and lenders that have discouraged them from participating in the Hope for Homeowners program;
- Offering new incentives for lenders to negotiate loan modifications with borrowers at risk of foreclosure under the Hope for Homeowners program; and
- Expanding the President's loan modification program to FHA and mortgages in rural areas (RHS).
Making College More Affordable
The cost of paying for college is becoming even more burdensome for Americans in this economy. While families are losing income, benefits and jobs, college tuition prices continue to rise. The average student now graduates with over $22,000 in total student debt, including federal and private student loans. This year's class of graduating college seniors also enters one of the toughest jobs markets in decades for recent graduates. Of the 1.2 million jobs lost last year, 60 percent were held by workers aged 25 or younger.
Given these challenges, new benefits went into effect on July 1, 2009 that will make student loan payments manageable for millions of Americans. (These benefits were signed into law in 2007 as part of the College Cost Reduction and Access Act.) They include:
- Cheaper interest rates on need-based (subsidized) federal student loans. On July 1, the interest rates on subsidized federal student loans will decrease from 6 percent to 5.6 percent. This is the second of four annual cuts in this interest rate; it will continue to drop until it reaches 3.4 percent in 2011.
- Reasonable and affordable monthly college loan payments for borrowers. On July 1, a new Income-Based Repayment program will go into effect that caps borrowers' monthly loan payments at just 15 percent of their discretionary income (15 percent of what a borrower earns above 150 percent of the poverty level for their family size). Any current or future borrower whose loan payment exceeds 15 percent of their discretionary income is eligible. After 25 years in the program, borrowers' debts will be completely forgiven.
- Higher Pell Grant scholarships that cover the average tuition at public universities. Due to funding provided by both the College Cost Reduction and Access Act and the American Recovery and Reinvestment Act, the maximum Pell Grant scholarship for the 2009-2010 school year will be $5,350 - more than $600 above last year's award.
Stopping Employment Discrimination Based on Sexual Orientation
In November 2007, the House passed the Employment Non-Discrimination Act (ENDA). In 30 states, it is currently legal to fire someone simply because of his or her sexual orientation. This bill prohibits employers, employment agencies and labor unions from using an individual's sexual orientation as the basis for employment decisions, such as hiring, firing, promotion or compensation. The bill extends federal employment protections to gay, lesbian, and bisexual workers similar to those already provided to a person based on race, religion, sex, national origin, age or disability.
Helping Families With Rising Food Costs
In June of 2008, Congress overrode the President Bush's veto of the Farm Bill, legislation that will ease the strain of rising food prices for millions of families. Nearly three-fourths of the Farm Bill, an additional $10.4 billion in new spending, goes to nutrition programs that help 38 million American families afford healthy food. It updates the food stamp program to reflect the current state of our economy. These critical food stamp provisions will help about 11 million people by 2012. Households with children receive 77% of food stamp benefits.
Repaying Our Veterans
The GI Bill for the 21st Century, which was signed into law, provides a four-year college scholarship to veterans who served in Iraq and Afghanistan. The legislation will give our returning troops the tools to succeed when they return home, as well as strengthen our shaky economy and help rebuild our military by making service more attractive.
The HEART ACT also became law, making permanent essential tax relief for our military families. This includes tax relief under the Earned Income Tax Credit, providing incentives to make sure that reservists called up for active duty do not suffer a pay cut, clarifying the availability of recovery rebates for military families, and expanding homeownership opportunities for veterans.