Why Access to Lawyers Matters for the Working Class

The inability of many working-class families to afford legal services is making the protections of the due process clause of the constitution elusive to a growing segment of American citizens . This is not an abstract theory.  It has  become the vivid reality in the recent foreclosure crisis. Thousands of families may have been removed from their homes based on the negligent behavior and fraudulent representations of  mortgage servicers and some lawyers who represent them.

Recent news reports tell a scary story about outrageous tactics by mortgage servicers, banks , investment trusts, and their lawyers seeking to foreclose on homeowners by presenting fraudulent documents and affidavits to courts to justify their complaints.  The majority of the homeowners affected lack the legal expertise to raise the questions necessary to stop the fraud and cannot afford to hire  lawyers who can.

Here is how the problem has developed.  During the mortgage boom of the past decade, banks and mortgage brokers aggressively solicited new mortgage loans from new homeowners and millions of middle and working-class families who were convinced to refinance their homes.  Those loans were then sold, often multiple times, and most were ultimately sold to trusts that were created for the purpose of securitizing the notes. The risk was passed on to bond holders, and the lucrative servicing rights maintained by the bond trust.  Massive demand developed on Wall Street to create the bonds backed by these mortgage trusts. This demand created pressure on the brokers and banks supplying the newly generated notes and mortgages to rush, and many ultimately become careless with the paperwork necessary to support the transfer of these notes.

In Ohio and many other states, contracts involving real estate must be in writing and many of them need to be recorded with county officials.  Further exacerbating the problem is the fact that since the meltdown of the market for mortgages, many of the companies that generated or sold these notes and mortgages have gone out of business.  Lenders and their lawyers who wish to foreclose on homeowners who have allegedly fallen behind on their mortgages are required to provide proof to the court not only that the mortgage is unpaid, but that the entity seeking to foreclose has actual ownership of the note and mortgage in question.

As a result, written assignments of mortgages, notes, and affidavits verifying their transfers have been generated by lenders and collection law firms to persuade courts that the proper party is before the court seeking foreclosure.  The allegation in the “robo-signing” of affidavits and other documents is that the banks and lawyers have employees sign these assignments and affidavits without having actual knowledge of the facts that they are verifying, or in the case of several who have testified in depositions, even looking to see whether company records support the allegations that they are verifying under oath.

While the conduct of some banks and lawyers in this scenario has been unconscionable, I can’t help but think that this problem would never have existed at all had working-class citizens in this country had better access to legal services.

Due process of law becomes worthless when litigants do not have meaningful access to legal services. Alleged holders of mortgages have essentially banked on the fact that most homeowners who have been sued for foreclosure in this country either do not have access to lawyers or choose not to hire them.  In an adversarial legal system, the allegations made by these law firms and their clients (some of which are presently being exposed as false) simply go unchallenged when the homeowner does not seek or obtain legal representation.

In New York State, for example, where aggressive efforts have been made to establish protections for homeowners facing foreclosure, a recent study reveals that 63% of homeowners who had the gumption to reach out to the court in response to a foreclosure complaint and were participating in the pre-judgment foreclosure conferences established in that state continued to be unrepresented by counsel.

The tragedy of this scenario is how easy it often is (or would be) for lawyers to challenge false allegations such as those being documented recently.  The first thing any decent lawyer does in defending any lawsuit is to systematically determine whether or not the plaintiff in that lawsuit had standing to bring the case to begin with. In the case of the robo-signed assignments and affidavits, revealing a problem is often as simple as creating an ownership timeline and matching dates to the documents that are attached to foreclosure complaints.  When affidavits are proffered, it would be virtually automatic for defending lawyers to take the deposition of those who claim personal knowledge of transactions that involved bankrupt companies, took place long in the in the past or that necessarily took place in different states.

Yet even these minimal steps require the expenditure of potentially thousands of dollars in legal fees, money that working-class families facing foreclosures simply don’t have.  Legal Aid Services are generally available only to families at 125% of the Federal Poverty Guidelines or less. ($27,525 for a family of 4).   Programs mobilizing pro bono lawyers continue to be focused on those below the legal services poverty guidelines.  The open marketplace for legal services leaves working-class people with nowhere to turn for protection.

That’s why Congress and state legislatures should consider either incorporating foreclosure proceedings under federal bankruptcy provisions or making state foreclosure processes more like federal bankruptcy actions.  In Chapter 13 proceedings in particular, the United States Trustee is charged with protecting not just the creditors or the debtor, but the fair operation of the system as a whole.  Bankruptcy courts make sensible provisions (and set reasonable limits) for the payment of legal fees for debtors and if appropriate the shifting of legal fees in situations where a fraud is perpetrated on the court.

Right now, the U.S. Bankruptcy Trustee can only weigh in cases where the homeowner has sought the protection of the bankruptcy court and only to determine whether or not a lender should be allowed relief from that court’s automatic stay to proceed with foreclosure. Even in that narrow context, some U.S. Trustees are beginning to hold banks accountable to prove their right to collect and foreclose.

Expanding the access to the protection of the Bankruptcy court and the trustee, or establishing a trustee-like figure to participate in state foreclosure proceedings and allowing for more liberal fee shifting when fraud is perpetrated on the court may be one way to offer the benefits of the adversarial process to working-class homeowners facing foreclosure.

Or better yet, we can use this crisis to begin the conversation about how to provide better access for working-class families to basic legal representation in civil matters.

Marc Dann

Marc Dann is a community affiliate of the Center for Working-Class Studies and a Cleveland lawyer specializing in labor and working-class issues.

Base Jumping: The Democrats and the Working Class

I have to admit that I am somewhat amused at the intellectual poking and prodding being done by pundits–particularly Democrats–as they analyze the results of the November midterm election.  It’s as if they’re a gaggle of pathologists standing around a corpse in a morgue unable to agree on what caused the death of the unfortunate soul lying on the slab in front of them.

While they argue vehemently back and forth, an aged maintenance man mops the floor around them. Clearly a grizzled veteran of the place impressed neither by death nor doctors, he looks over the shoulders of the physicians, takes a peek at the body, shrugs, says to no one in particular,  “Somebody cut the guy’s head off,” and returns to his cleaning.

Mystery solved.

It’s the same with this election.  There’s no need to scrutinize the exit polls or torture the demographic data.  Anyone who didn’t immediately recognize what killed the Democratic Party this year just isn’t—and hasn’t—been paying attention.  That’s because we witnessed a copycat killing, an eerie replay of the 1994 execution of the Democrats at the Congressional and state level precipitated by Bill Clinton’s disastrous first two years in office.

It was, in fact a killing predicted in this space back in January, when I wrote the following in the wake of Republican Scott Brown’s victory in the race for the late Ted Kennedy’s senate seat:

Instead, Democrats now find themselves looking down the barrel of a gun held by members of a disenchanted electorate who are currently demonstrating a clear proclivity to vote for the party of no ideas—the GOP–over the party of badly executed ones.

And they have no one to blame but themselves.

Barack Obama placed the Democrats in front of the firing squad by repeatedly deriding and ignoring the party’s base voters.  He did it during the health care debate by barring any discussion of a Canadian-style single payer system and then abandoning its watered-down cousin, the public option, in a futile attempt to attract Republican support.

He did it by ignoring progressives like Paul Krugman who warned that his economic recovery plan would fail because it placed far too much emphasis on re-inflating Wall Street and far too little on resurfacing Main Street.

He also did it by continually contending that a failure to communicate, rather than failed policy, was at the heart of the dilemma the Democrats faced as the election grew near.  In essence he was telling working and middle class Americans that they weren’t smart enough to understand all that he had done for them, when, in reality, they clearly believed he had accomplished very little.

That belief is reflected in the results of a survey the Center for Working-Class Studies conducted immediately before the election.  Although Mr. Obama continually tried to convince people that his stimulus plan was effective, 80% of the respondents who categorized themselves as “working class” believed the economy was bad or very bad, 64% said it would stay that way for two years or more, less than 40% believed the country was heading in the right direction, and 56% said they felt the American Dream was slipping away.

In short, they weren’t buying what he was trying to sell, something that would prove disastrous on November 2 because, while we can debate about the make-up of the party’s base and the definition of its  “working class” component,  two things are inarguable: first, that 2010 was the third change election in a  row and, second, the base, amorphous and hard-to-define as it may be, is critically important in such elections because it is the one group that can be counted on to stay the course.

That fact is underscored by the results of the CWCS survey. Although deeply pessimistic about the state of the economy and the future, 69% continue to have a favorable opinion of the president and more than 70% favored Ted Strickland over John Kasich in the race for Ohio governor.

Unfortunately, poll results aren’t ballots, and as happened in 1994, the disaffected members of base did what the disaffected and disappointed do: they stayed at home.  Voter turnout in traditional Democratic strongholds like Mahoning, Trumbull, Cuyahoga, and Summit counties fell well below 50%, depriving Strickland of the votes he needed in what turned out to be a very close election.  As a result Ohio, the swing state of all swing states, fell into the hands of the Republicans–bad news for the Democratic president who will almost certainly need to carry the state if he hopes to win reelection in 2012. As CWCS co-director, John Russo, said in March 2010, “working people are looking elsewhere for agency and voice.”

Finally, while we may have witnessed a copycat killing, the effects of this year’s election have the potential to be more wide-reaching and long-lasting than what followed the Democratic drubbing of 1994.  Unlike that year, this mid-term fell immediately before the redistricting process will begin across the country.  Mr. Obama’s failures have placed the redistricting pen—actually it’s more likely to be a computer mouse these days—in GOP hands in a vast majority of states.  That means the likelihood of Democrats regaining the majority in the U.S. House any time soon is extremely remote.

In addition, unlike Mr. Clinton, who recovered from the battering he took during his first two years in office by working with the Republicans on welfare reform and riding the economic boom of the mid-90s, Mr. Obama faces recalcitrant Congressional Republicans who are committed to driving him from office, a deeply troubled economy that is not expected to grow significantly over the next two years, and a Democratic base that will grow even more frustrated  if he follows what appears to be his natural instincts and compromises with the GOP on critically important issues.

As of this moment, the White House seems unconcerned about their dimming prospects for the future, apparently buoyed by their belief in the cliché that you can’t beat someone with no one, a reference to the currently weak field of Republican presidential hopefuls.

They would do well to remember that history has a way of repeating itself and that Bill Clinton was the “no one” George Bush was unconcerned about in 1992.

Leo Jennings

The Democrats and Social Classes

It’s more than a little frustrating trying to follow Democrats’ analysis of social classes in this country.  Most of the time now, there are only two classes – the rich (very precisely defined as those with at least $250,000 in annual family income) and the middle class, which includes everybody else.  But in the analysis of elections a “working class” shows up, one which is invariably “white” and, it seems, predominantly male.

Most Democrats, and especially the more progressive ones, know that moving the white working class away from its decades-long lopsided loyalty to the Republican Party is crucial to achieving a long-term governing majority.  But instead of appealing to this demographic electoral block directly, it seeks to lump them in with what Dems think is a universally beloved “middle class.”  This is a tactical mistake, as in many working-class precincts calling somebody “middle class” is meant as a put down and an insult – somebody who doesn’t live “real life,” lacks common sense, and yet thinks they’re “all better.”  Believe me, I’ve been on the front end of this insult, sometimes deservedly so.

Of all the ways of defining class in America the one that gets the least attention is how people self-identify – that is, what class people see themselves as being in.  In exit polls, for example, you get a choice of “White, Black, Hispanic/Latino, Asian, or Other” in defining your race.  There is no such question for class.  Rather, pollsters ask questions about education and income, and then analysts assign people to various classes based on the analysts’ own definitions.  As is often pointed out on this site, the one national survey that consistently asks people to identify themselves by class has for decades found about 46% self-identify as “working class” and another 46% as “middle class.”  Nobody has any idea how voters who see themselves as working class have actually voted — ever.

Over the last decade, through what has often been a rich debate among political scientists, journalists, political operatives, and statisticians, the presence or absence of a bachelor’s degree has come to be used as a marker identifying voters as either “working class” or “middle class.”  Because having a bachelor’s degree correlates pretty strongly with having a professional or managerial job and because these jobs correlate with higher incomes, this is a serviceable marker for “middle class.”  Likewise, because the two-thirds of jobs that are not professional or managerial usually do not require bachelor’s degrees and have lower average incomes, the absence of a bachelor’s degree is a good-enough way of locating the “working class” among voters.  Until exit-pollsters provide voters with a range of choices on class, as they do now for race, this education marker is the best we can do in measuring how social class affects voting.

Problem is that in the last two elections, these two broad classes voted almost exactly the same way.  In 2008 both “college graduates” and “no college degree” voters voted for Barack Obama by a margin of about 53% to 46%, whereas both groups in 2010 voted 52% to 46% for Congressional Republicans.  So, there was a big swing in the last two years, but both the working class and the middle class swung exactly the same way and to the same degree. Thus, class by itself seems not to affect how people vote.

If, however, you measure class along with race, then class matters a bit more.  Neither class of whites gave Obama a majority in 2008, but middle-class whites gave him 47% of their vote, while working-class whites gave him only 40% of theirs.  Meanwhile, among non-white voters (lumping together all “Black, Hispanic/Latino, Asian and Other” voters), there was a similar degree of difference by class but in the opposite direction – working-class non-whites gave Obama a larger majority (83%) than middle-class non-whites (75%).  A similar race-class pattern occurred in the 2010 Congressional elections, with working-class whites giving Republicans 62% while middle-class whites gave them 57%, whereas working-class non-whites were more decisively Dem at 77% than middle-class non-whites at 71%.

Two conclusions emerge from this breakdown:

One is that race matters way more than class.  In fact, very few large groups of whites have voted majority Democratic at the national level for decades.  Using only the exit polls, which do not cover all possible groupings, the only whites who gave Obama a national majority in 2008 were Jews (83%), whites with “no religion” (71%) or “other religion” (67%), and 18-to-29-year-olds (54%) – though it is important to add that Obama won white majorities in 19 states and in the Northeast as a whole.

The other conclusion is that the single largest race-class grouping, the base of the base of the Republican Party in America, is working-class whites.  Even though declining as a proportion of the electorate (as non-whites increase faster in the population and as more whites get bachelor’s degrees and are, therefore, no longer considered “working class”), working-class whites are still almost two of every five voters, and until 2010 they had been voting in the neighborhood of 60/40 for the GOP in national elections.

In parts of the country outside the South, however, the white working-class, like whites in general, has been drifting toward the Democrats over the past few decades, culminating in the 2008 election when, for example, Obama won majorities of white workers in 14 states and got into the high 40s in four others.  That drift was reversed big time in the 2010 Congressionals.  According to the guru on these matters, Ruy Teixeira: “The most significant shift against the Democrats [in 2010] occurred among the white working class.  Congressional Democrats lost this group by 10 points in both 2006 and 2008.  Yet that deficit ballooned to 29 points in 2010.”

That’s a huge move toward Republicans who were against saving the American auto industry and who voted against infrastructure investments and jobs, (very) partial bailouts of state governments, extensions of unemployment insurance, and health care reform and tax policies that benefit working-class whites more than any other race-class grouping (in absolute numbers though not proportionately).  And this massive swing occurred nowhere more strongly than in the Great Lakes states, including strong union states Pennsylvania, Ohio, Michigan, Illinois, and Wisconsin.

What accounts for this swing of previously Democratic white working-class voters in 2010 will be the subject of my next blog.  Until then, I can do no better than recommend  that all Democrats look at a conservative Republican’s class analysis of “Midwest at Dusk.”
Jack Metzgar, Chicago Center for Working-Class Studies

Disconnected, Disenfranchised, and Poor: Addressing Digital Inequality in America

Reports that 79% of Americans now use the internet should not obscure the needs and problems of those lacking internet access or computer literacy.  In today’s information-based economy, internet access and computer literacy are crucial to economic growth at all levels, including global.  Businesses are attracted to computer-literate communities and hesitate to do business with those that are not, and that can limit economic opportunities for everyone in the community. This is why we should all care about low levels of internet access and computer literacy within our communities.

Research conducted by the Pew Research Center indicates that those with limited income and education are most likely to not use the internet or even understand how to use a computer. Internet use is clearly tied to economic status and education.  While 95% of upper- income households use the Internet, 37% of lower-income households do not.  And while 4 % of college graduates do not use the internet, 48 % of those without a high school diploma do not. About half of non-users identify cost and lack of computer skills as the primary barriers.

Poor people most often go to public libraries when they do not have internet access at home or through a job or school. Nearly 19 million people living in poverty use public library computers to access the internet for health, education, and employment information and to read the news. Unfortunately, state and local cuts in library funding have led many libraries to cut hours, staff, and spending on computers. Reducing some people’s only access to the internet deepens the digital divide—when more and more information is most readily available online. These reductions also make it harder for those with limited access to gain computer literacy, and that contributes to the growing economic gap between the rich and poor.

That gap is not just about job skills.  Lack of computer literacy and internet access also prevent people from fully participating in society.  This disenfranchises some people and, in effect, makes them second-class citizens. People who lack internet access and who are not computer literate cannot obtain, communicate, and use information for their benefit as quickly as those who can use the internet effectively. Consider how reliable internet access helps people apply for jobs quickly or take swift political action. As the Social Science Research Council suggests, lack of computer access and literacy are now mechanisms of social and economic exclusion. When the adverse effects of this exclusion (e.g. poverty) are transferred to subsequent generations, groups may be disadvantaged well into the future.

It’s not just disparity in mere access to the internet or the ability to turn on a computer that characterizes digital inequality. Quality of internet access also matters, as do freedom to use the internet without time  and equipment constraints and opportunities to develop information-seeking skills. In her study of American youth, Laura Robinson found that digital inequality exacted a heavy toll on low-income students who competed to obtain internet access at school or the public library.  Lacking internet access at home, the students recounted the stress of skipping lunch, not going to the bathroom, and waiting in long lines in order to use the internet in these settings. A thirty-minute time limit on terminal use in some libraries also caused the students emotional stress. Limited access led low-income students to spend less time surfing the internet for information than their higher-income counterparts who had internet access at home, and it created stresses that probably made their internet use less effective. Group differences in time spent online led to group disparities in the development of information-seeking skills, which placed lower-income students at a disadvantage in school and the labor market.

No group should be denied internet access and the benefits derived from its use because of low income, place of residence, disability, gender, or race-ethnicity. To bring about true digital equality in America, a holistic approach must be implemented. Under this approach, high-speed internet would be installed in underserved communities. Computers would be designed so that the disabled could affordably use them and go online. Subsidies would be provided to impoverished households that could not afford internet connection. The functionally illiterate would receive the literacy and computer skills they need in order to access the internet. Additional computer technology centers would be built, and existing ones, staffed at higher levels. Internet access at public libraries would be upgraded and increased. Child care assistance would be given to low-income parents to take computer classes so that they might qualify for better jobs. More would be done to help poor inner-city youth attain a high school diploma and post-secondary education. Such changes might help poor people improve their chances to secure jobs with livable wages, so they could afford internet access at home. Under a holistic approach to digital inequality, the goal would be to empower all groups to participate fully in our information society, so that fewer are left behind— now or in the future.

Denise Narcisse, Center for Working-Class Studies

CWCS Poll: The Midterm Election and the American Dream

The “enthusiasm gap” between Republicans and Democrats widely reported by the national news media in recent weeks is not apparent in the results of the latest on-line public opinion survey conducted by the Center for Working-Class Studies (CWCS) at Youngstown State University. The poll also offers insight into how people define the American Dream and whether they think it’s still viable.  Results of the poll, the fourth in a series conducted by the Center, are available on-line at the CWCS website.