Consumer Financial Protection Efforts: Answers Needed (Part 1 of 2)

Consumer Financial Protection Efforts: Answers Needed (Part 1 of 2) - House Oversight - 2011-07-14 - House Committee on Oversight and Government Reform. Witnesses Elizabeth Warren, Assistant to the President, and Special Adviser to the Secretary of the Treasury. Video provided by US House of Representatives.

Concepts Of Deficits And FRBM Act, 2003

Q1. Write a note on concepts of deficits and their trends.

Ans. CONCEPTS OF DEFICITS:

• INTRODUCTION:

A public budget is a systematic estimate of government's revenue and expenditure for a period of one year. It shows the planned expenditure of the government and the expected revenue from taxes and other sources during a given year. A public budget can be balanced, surplus or deficit. A deficit in a budget indicates excess of expenditure over receipts.

• CONCEPTS:

In India, the budget has always shown deficit. A deficit in the budget has many implications for the economy and it influences the process of policy making. The followings are the various concepts of deficits and their changing trends in India.

1) REVENUE DEFICIT:

Revenue deficit takes place when revenue expenditure exceeds revenue receipts. Revenue receipts comprises of direct and indirect taxes, fees, fines, and surpluses of public enterprises, etc. Revenue expenditure is the expenditure incurred on administration, defence, interest payments and subsidies.

Trends:

The Government of India has shown the following trends in Revenue Deficit:

Yr. Rs. ( in crores) % of GDP
1990-91 18,562 3.3
2007-08 52,569 1.1
2009-10 2,82,735 4.6

Revenue deficit has increased to a great extent since 1990-91. The major reason for this increase can be attributed to increase in INTEREST PAYMENTS and SUBSIDIES. In 2007-08 the revenue deficit in terms of % of GDP declined.

However, in 2008-2009 and 2009-2010 revenue deficit rose significantly (both in absolute terms and in terms of % of GDP) to overcome the problem of economic slow down.

2) BUDGET DEFICIT:

Budget deficit is the excess of total budget expenditure over total budget receipts.
Both, revenue and capital expenditure and receipts are taken into consideration.
However, the concept of budget deficit has lost its significance since 1997-98.

3) FISCAL DEFICIT:

Fiscal deficit (FD) occurs when total expenditure (TE) including net lending (NL) exceeds revenue receipts (RR)+ external grants (EG) + non debt capital receipts (NDCR). Thus fiscal deficit can be explained as:
FD = (TE + NL) - ( RR + EG + NDCR).

Where:

FD = Fiscal deficit, TE = total expenditure, NL = net lending ( loans - recovery ), RR = revenue receipts, EG = external grants, NDCR = non debt capital receipt (proceeds from disinvestment of public sector enterprises )

Also, fiscal deficit can be:

• Gross Fiscal deficit = (TE+NL) - ( RR + EG + NDCR)
• Net Fiscal deficit = GFD - NL.

Trends in Gross Fiscal Deficit:

Yr. Rs. ( in crores ) % of GDP
1990-91 37,606 6.6
2007-2008 1,26,912 2.6
2009-10 4,00,996 6.5

Fiscal deficit reflects the indebtedness of the government more comprehensively has been since 1991, the Government making attempts to reduce fiscal deficits. However, the fiscal deficit continued to rise till 2001-02.

Since 2001-02, GFD as q % of GDP began to decline as a result of the governments efforts.

Again in 2008-09, due to global economic slowdown, public expenditure increased significantly to boost growth rate.

4) Primary Deficit:

Primary Deficit is equal to fiscal deficit minus interest payments.

It can be divided into

• Gross Primary Deficit = GFD - interest payments.
• Net Primary Deficit = NFD - interest payments.

Trends:

Yr. Rs. ( in crore ) % of GDP
1990-91 16, 108 2.8
2006-07 -7,699 -0.2
2009-10 175485 2.8

This indicates that the Government has been making efforts to bring down the fiscal deficit. However huge amount of interest payments and economic slowdown in 2008-09. Obstructed these efforts.

Q 2. Critically evaluate the FRBM Act, 2003.

Ans. FISCAL RESPONSIBILITY AND BUDGET MANAGEMENT ACT, 2003. ( FRBM ACT, 2003)

• INTRODUCTION:

The Fiscal responsibility and Budget management Bill was introduced in the parliament in December 2000, with the primary objective of reducing the debts and deficits of the central Government.

The FRBM bill became an Act on August 26, 2003 and it was brought into force on July 5, 2004.

• OBJECTIVES:

The following are the main objectives of the FRBM Act, 2003.

1) To set a limit on the governments borrowings.
2) To bring down fiscal deficits.
3) To adopt prudent debt management techniques to reduce the burden of debt payment on future generations.
4) To generate revenue surplus.
5) To ensure long term macro-economic stability.
6) To improve transparency in the fiscal operations of the Government.

• FEATURES:

The following are the main features of the FRBM Act, 2003 and the FRBM Rules, 2004:

1) FISCAL DEFICIT:

The FRBM Rules, 2004 stipulate that the central Government must take appropriate measures to reduce the fiscal deficit by 0.3% or more of GDP at the end of each financial year, beginning with 2004-2005, so that the fiscal deficit is less than 3% of the GDP by the end of 2008-2009.

1) REVENUE DEFICIT: The FRBM Rules, 2004 stipulate that the central Government must take appropriate measures to reduce the revenue deficit by an amount of 0.5% or more of the GDP at the end of each financial year, beginning with 2004-2005.

The FRBM Act, 2003, stipulates that the Central Government must take appropriate measures to eliminate the revenue deficit by 2008-2009, and there after build up adequate revenue surplus.

2) ADDITIONAL LIABILITIES

The FRBM Rules, 2004 stipulate that the Central Government should limit additional liabilities ( including external debt at current exchange rate) to 9% of GDP in 2004-2005 and progressively reduce this limit by at least one percentage point of the GDP in each subsequent year.

3) BORROWINGS FROM THE RBI:

The FRBM Act, 2003 stipulates that the Central Government is not to borrow directly from the RBI except by way of advances to meet temporary shortage of cash.

4) GOVERNMENT GUARANTEES:

The Government should not provide guarantees to loans borrowed by the state Government and public sector enterprises in excess of 0.5% of GDP in any financial year beginning with 2004-2005.

5) RELAXATION IN DEFICIT REDUCTION TARGETS:

The FRBM Act states that the revenue and fiscal deficit may be more than the target specified in the Rules, only on grounds of national security and national calamity or other exceptional grounds as may be specified by the Central Government.

6) FISCAL INDICATORS:

The FRBM Rules, 2004 states that the Central Government should specify four fiscal indicators to be projected in the medium term fiscal policy statement:

• Revenue deficit as a percentage of GDP
• Fiscal deficit as a percentage of GDP
• Tax revenue as a percentage of GDP
• Total outstanding liabilities as a percentage of GDP

7) QUATERLY REVIEWS:

The FRBM Act states that the finance Minister should conduct quarterly reviews of receipts and expenditure in relation to the budget and place the outcome of these reviews before the parliament. Moreover, he must make a statement in the Parliament explaining the reasons for deviations from the FRBM Act targets and also announce the corrective measures that are proposed to be taken inorder to overcome these deviations.

8) TRANSPARENCY:

The FRBM Act states that the Government should reform accounting system, improve fiscal transparency, disclose information on revenue arrears, guarantees and assets latest by 2006-07.

9) PLACING OF REPORTS:

The FRBM Act requires that three reports be placed before both the houses of the parliament every financial year:

• Macro-economic framework statement
• Fiscal Policy Strategy Statement
• Medium term Fiscal Policy Statement
• CRITICAL EVALUATION:

The FRBM Act has been criticized on the following grounds:

1) UNFULFILLED TARGETS:

The FRBM Act required the government to reduce revenue deficit to zero by March 2009. However, the revenue deficit increased to 4.4% of GDP in 2008-09 and to 4.6% in 2009-10. Thus, critics point out that target set for deficit reduction are unrealistic.

2) DEFECTIVE ASSUMPTIONS:

The FRBM Act is based on the following assumptions:

Lower fiscal deficit leads to higher economic growth in the long run.
Larger fiscal deficit leads to inflation
Larger fiscal deficit leads to balance of payment problems.

Economists like C.P. chandrashekhar and Jayati Ghosh object to such assumptions. They state that if fiscal deficit is large due to large capital expenditure on infrastructure, then it will generate employment and demand for goods and service will rise, resulting in economic growth.

Inflation occurs when demand is greater than supply, irrespective of fiscal deficit. Moreover, if large fiscal deficit is backed by large foreign exchange, it may not cause external sector problems.

3) EFFECT ON ECONOMIC DEVELOPMENT:

At present, the amount of capital expenditure by the Government is very low. Capital Expenditure increase the efficiency and productivity of private investment and thus contribute to the development process in the country.

Since 1991, the capital expenditure GDP ratio has been declining. This will have a negative effect on economic development.

4) NEGLECT OF SOCIAL SECTOR:

If the government reduces social sector expenditure on education, health and family welfare, it will adversely affect human development.

This will have a negative impact on growth and development

5) IMPACT ON EQUITY:

Equity is the fair a just distribution of income among all the citizens of the nation. Some critics believe that FRBM Act will harm equity they argue that the government will reduce expenditure on subsidies with a view to control fiscal deficit.
This will lead to social injustice.

6) SIGNIFICANCE OF REVENUE IGNOREO:

The FRBM Act over emphasizes reduction in public expenditure and ignores importance of revenues. Deficits can be controlled if collection of tax and non -tax revenues is improved.

7) PRIVATE INVESTMENTS:

Economists argue that if capital expenditure on infrastructure is reduced, it will have a negative impact on private investment due to decline in productive efficiency.

This will adversely effect economic growth.

8) SUBSIDIES:

Subsidies form a very large part of the government's revenue expenditure. However, in reality, it is a wasteful expenditure because many times subsidies benefit those who do not need them leg rich farmers. This limits the effectiveness of FRBM Act.

9) QUASI - DEFICITS IGNORED:

Fiscal deficit is not a complete indicator of the Government's liabilities. Some PSU receive hidden subsidies from the Government but they are not shown in the budget. These subsidies are indeed liabilities of the government and are known as quasi - deficits. These liabilities are very large, but they are beyond the scope of FRBM Act.

• CONCLUSION:

In spite of all the above criticisms, the FRBM Act, 2003 is an important step taken by the Government for better management of its financial operations.

Also, the FRBM Act need not necessarily affect the economic and social development of the nation.

DEBT COLLECTIONS AND INTERNATIONAL LEGAL RECOVERY SERVICES

DEBT COLLECTIONS AND INTERNATIONAL LEGAL RECOVERY SERVICES: International and Local Business Debt Recoveries, National and International Debt Recovery in General, Government Trade and Commercial Debt Collection, Personal and Small Business Debt Collection, Global Sports Collections for Athletes and Artists, Cross-Border and Multinational Debt Collections, Enforcement of Foreign and Domestic Judgments, Enforcement of Arbitral Awards, Creditor and Debtor Legal Representation, Opinions on Collectability of a Claim, Judgment or Arbitral Award, Mediation Representation, Court Litigation and Administrative Agency Representation, Tax Implications on Debt Collection Recoveries, Legal Recovery of Monies owed around the World by Merchants

Cyberethics (Information System Ethics)

In order to examine ethical issues, it is first necessary to define ethics. Today, we regard ethics as a "rational process founded on certain principles." However, I believe a definition that is more applicable to this project is the ethical theory that existed in ancient Greece. There, ethics was the study of what was good for both the individual and society. We will look at some online issues and how they may be good and/or bad for society. Cyberethics is quite simply the study of ethics on the Internet.
"Ethics begins when elements within a moral system conflict."
Cyberethics is often called as Information System Ethics. Information System ethics can be defined as "The study of moral, legal, ethical issues involving the use of information and communication technologies"
There are many unique challenges we face in this age of information. They stem from the nature of information itself. Information is the means through which the mind expands and increases its capacity to achieve its goals, often as the result of an input from another mind. Thus, information forms the intellectual capital from which human beings craft their lives and secure dignity.

However, the building of intellectual capital is vulnerable in many ways. For example, people's intellectual capital is impaired whenever they lose their personal information without being compensated for it, when they are precluded access to information which is of value to them, when they have revealed information they hold intimate, or when they find out that the information upon which their living depends is in error. The social contract among people in the information age must deal with these threats to human dignity. The ethical issues involved are many and varied in Information System Ethics.

Ethics is required in information Systems to overcome the following ethical issues.

Privacy: What information about one's self or one's associations must a person reveal to others, under what conditions and with what safeguards? What things can people keep to themselves and not be forced to reveal to others?

Accuracy: Who is responsible for the authenticity, fidelity and accuracy of information? Similarly, who is to be held accountable for errors in information and how is the injured party to be made whole?

Property: Who owns information? What are the just and fair prices for its exchange? Who owns the channels, especially the airways, through which information is transmitted? How should access to this scarce resource be allocated?

Accessibility: What information does a person or an organization have a right or a privilege to obtain, under what conditions and with what safeguards?

Information System ethics explores and evaluates:

o the development of moral values in the information field,

o the creation of new power structures in the information field, information myths,

o hidden contradictions and intentionality's in information theories and practices,

o the development of ethical conflicts in the information field. etc

Now let us take a look at privacy by the following examples. A few years ago, Florida lawmakers gave the go ahead to have monitors stationed in bathrooms at Tallahassee Community College to determine if the facilities were being underutilized. Students and faculty vehemently protested that the monitors violated their privacy. State officials said that the value of the information gained through the study was more important than the threat to privacy. Other issues like collection of private data of the users using internet by monitoring the traffic is strongly related to one's policy as that information can be further used for illegal purposes. These types of privacy issues are needed to be addressed properly so that they should not exploit one's freedom. One issue that I kept thinking about when I was constructing my Web page was whether it was ethical to lift an image from someone's home page and use it on my Web page without crediting the source. Such ethical issues come under property.

One reason that topics such as online gambling and pornography have become such firestorms of controversy in cyberspace is the simple fact that so many people have access to the Web sites. Simply put, if no one had access to online pornography no one would care. With this another issue "Censorship" comes which should be deal in efficient way as it is not easy to implement. Ethical issues can also be religious, moral or any other.These type of issues are not easy to deal with.

Similarly, let us take China into consideration on the issue of "Censorship". China has implemented the methods of censoring the internet that are somewhat harder to bypass for people generally unfamiliar with the way internet works. There is ,for example internet censorship as implemented in China--using a list of banned words that are censored on the fly. As users in china request a webpage , the incoming page is first inspected by government servers n blocked if a banned term such as "Democracy" is present. Human censors are also actively looking at what people browse on the internet, and block websites as they see fit.

Crimes on internet are also increasing in a continuous manner.Computer crime is a general term that embraces such crimes as phishing, credit card frauds, bank robbery, Industrial espionage, child porn, kidnapping children via chat rooms, scams, cyber terrorism, viruses, spam and so on. All such crimes are computer related and facilitated crimes. Many recent cases seen like Microsoft's website was brought down for a little time resulting in a huge loss to Microsoft. Similarly, NUST, one of the best considered university in Pakistan got Hacked and redirected to another domain. Credit card fraud have grown in an increasingly manner. Leakage of Military information from internet is another internet crime. Software known as google earth, which shows information about different places including military land or can lead to robbery planning, is becoming an ethical issue around the world. Many people protest against this leakage of information but still one can't deny that it is one of the major enhancements in Information Technology.

The question about how to police these crimes has already been constructed, but this task is turning out to be an uphill battle. Since the first computer crime law, the Counterfeit Access Device and Computer Fraud and Abuse Act of 1984, the governments have been trying to track down and stop online criminals. The FBI of different countries have tried many programs and investigations in order to deter Internet crime, like creating an online crime registry for employers .The reality is that Internet criminals are rarely caught. One reason is that hackers will use one computer in one country to hack another computer in another country. And that criminal isn't working alone. Loosely organized groups--which security experts call "Web gangs"--conduct much of the illegal activity online. The structure of Web gangs may be patterned on that of traditional organized crime, in which the members of the group may never come into contact with one another and may never be aware of who they are working for.

Conclusion:

We live in an exciting time in history. The widespread availability of computers and Internet connections provides unprecedented opportunities to communicate and learn. Unfortunately, although most people use the Internet as a powerful and beneficial tool for communication and education, some individuals exploit the power of the Internet for criminal or terrorist purposes.

We can minimize the harm that such individuals do by learning ourselves, and teaching young people, how to use the Internet safely and responsibly. The term "cyberethics" refers to a code of safe and responsible behavior for the Internet community. Practicing good cyberethics involves understanding the risks of harmful and illegal behavior online and learning how to protect ourselves, and other Internet users, from such behavior. It also involves teaching young people, who may not realize the potential for harm to themselves and others, how to use the Internet safely and responsibly.

YYCCC 2011-02-07 Calgary City Council - Airport Underpass - Feb 7, 2011

Debate over Calgary Airport Underpass, which was passed 8-7. Care about the environment, economy, or just love technology? Check out my documentary about the Liquid Fluoride Thorium Reactor! ThoriumRemix.com www.youtube.com

Who Can Garnish Wages?

Who can garnish wages is virtually unlimited. Anyone that has obtained a judgment against you can enforce or collect on the judgment by garnishing your wages unless it is the Internal Revenue Service or Franchise Tax Board. From a taxing authority you will receive a notice of levy and if you do not respond they will garnish your wages without obtaining a judgment. Your wages can also be garnished under rare circumstances if you have agreed to a wage assignment, which is different then wage garnishment.

All other parties must sue you by filing a complaint and serving you with the summons and complaint. Once served has been made the party can then obtain a judgment against you. If you ignore the complaint the party will be able to request entry of the judgment by default. If you choose to answer the complaint the party suing you will next be able to obtain a judgment by filing a motion for summary judgment by the court. If your debt and lawsuit are the result of a breach of contract like not paying a credit card company you will have very few defenses and they will most likely obtain a judgment against you.

Once the judgment is entered the next step is to enforce the judgment. Just because a party has obtained a judgment against does not necessarily mean they will spend more money to go through the process of enforcing the judgment. To enforce the judgment they can garnish your wages, levy on your bank accounts and record the judgment with the county in which you live hoping it will attach to any real property you may own.

If your wages are garnished you can file an exemption to reduce the amount that can be garnished each paycheck and even stop the garnishment altogether depending upon your circumstances. Filing bankruptcy will stop the garnishment of your wages and depending upon the circumstances get rid of the judgment forever too. Bankruptcy is not the only answer, but for many it is the permanent solution to making sure the enforcement of the judgment does not continue.

Many collection agencies improperly tell people that they are going to garnish their wages without having obtained a judgment in an attempt receive a payment. This could be a violation of the Fair Debt Collection Practices Act and any contact with the collection agency should be documented for future prosecution if it continues.

Debt Collection Services | Collection Agencies

debtcollectionservices.com - Debt collection services information on collections laws, debt collection agencies, and free debt collections tips to minimize your accounts receivable