Tag Archives: Supreme Court

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At Risk: Oregon’s Minority Scholarships are in Jeopardy

Congratulations to Olivia, Rodney, Kayla, Allie, and Sumeyah, the Black United Fund of Oregon (BUF-OR) announced with pride. All earned Amina Anderson scholarships awarded to students to pursue higher education at an accredited college or university within the State of Oregon. To qualify for the scholarship, students must identify as Black, African-American, or of African descent.

Other minority students in Oregon celebrated, too. There was the Oregon Latino Scholarship from the Hispanic Metropolitan Chamber, where applicants must be of Hispanic ancestry and permanently residing in Oregon or Clark County, A total of $117,700 was awarded to 40 students on May 3rd, 2024, during the Chamber’s annual Scholarship Award Luncheon at the Oregon Convention Center, in Portland, Oregon.

There was also the Oregon Chinese Consolidated Benevolent Association Scholarship for Chinese high school seniors, and the Full Circle Scholarship from the American Indian College Fund for American Indian and Alaska Native students in Oregon.

I hope they treasured their awards. They may be among the last winners. All college scholarships restricted to minority students in Oregon and other states could soon be on the chopping block.

A lawsuit just filed against McDonald’s in federal court Nashville, TN alleges that the company is discriminating against non-Latinos with its HACER National Scholarship Program. The program offers scholarships between $5,000 and $100,000 to up to 30 outstanding students from across the US with at least one parent of Latino or Hispanic heritage.

“So non-Hispanics—including non-Hispanics with severe financial need and racial minorities like blacks, Arabs, and Native Americans—are flatly barred based on their ethnic heritage,” the lawsuit says. “This kind of discrimination was never lawful.”

The lawsuit was filed by the American Alliance for Equal Rights, led by Edward Blum. His lawsuits against Harvard and the University of North Carolina led to a 2023 U.S. Supreme Court ruling to stop affirmative action admissions at colleges. Blum has consistently argued against laws and policies that make distinctions based on race or ethnicity in areas such as voting and education.

“Like the vast majority of Americans, I believe that an individual’s race and ethnicity should not be used to help them or harm them in their life’s endeavors,” Blum told The New York Times after the Supreme Court ruling. ” This opinion is the end of the beginning. This issue of race and ethnicity in our public lives is not going to go away.”

The Supreme Court’s ruling has already spurred other nonprofits outside of Blum’s to target what they perceive to be discriminatory scholarships and fellowships. The Equal Protection Project of the Legal Insurrection Foundation, for example, has filed multiple complaints with the U.S. Department of Education’s civil rights office over universities’ minority scholarships and fellowships,

As The Washington Post has observed, the Supreme Court’s decision “is being closely watched because of its possible implications for race-conscious programs in the private sector.”

Get ready for change.

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Rep. Suzanne Bonamici: No Friend of Working Families

U.S. Rep. Suzanne Bonamici, D-OR, is thrilled with President Biden’s actions cancelling student loan debt. She shouldn’t be. 

Even though she has a bachelor’s degree and a law degree from the University of Oregon, it’s clear she’s no economist. And even though she’s a member of the House Progressive Caucus and tries to package herself as an advocate for the common man (and woman), her support for student loan forgiveness suggests she’s no friend of working families either.  

That’s because, for one, the billions in student debt aren’t, in fact, being cancelled. The loans will still be paid off. The issue is by whom?

“The idea that the government is footing the bill for this policy is a bit misleading,” the American Institute for Economic Research points out.   “The cost of the program does not fall on the government. It falls on those who miss out on expenditures that would have otherwise occurred, those who pay higher taxes as a result of the program, those who pay higher interest rates or are crowded out due to additional government borrowing, or those who see the purchasing power of their dollars reduced more than usual.”

Even though the Supreme Court ruled that the Biden administration overstepped its authority in 2022 when it announced that it would cancel up to $400 billion in student loans, Biden has since been rolling out a series of debt forgiveness alternatives using a variety of executive actions.

Biden’s ingenuity in coming up with more loan repayment exceptions seems to have no bounds.  

On April 8, 2024, the White House announced an initiative that would:

  • forgive interest balances built up to date for 25 million borrowers, with 23 million likely to have all of their balance growth forgiven.
  • automatically cancel debt for borrowers eligible for loan forgiveness under several loan programs.
  • cancel student debt for borrowers who entered repayment over 20 years ago.
  • cancel student debt for loans associated with institutions or programs that lost their eligibility to participate in the Federal student aid program or were denied recertification because they cheated or took advantage of students.
  • cancel student debt for borrowers experiencing hardship paying back their loans.

While there’s no question student debt has become a burden for many Americans, Biden’s escalating efforts to relieve borrowers of obligations to repay student loans will add to the government’s annual deficits and the national debt. In other words, current student loan holders may escape repayment, but future taxpayers will have to pay the bill since Biden isn’t proposing any new revenue collections to cover the cost.

On April 11, the University of Pennsylvania’s Penn Wharton Budget Model estimated that Biden’s April 8 plans, if they are implemented, will cost the government $84 billion, in addition to the $475 billion that Penn Wharton previously estimated for Biden’s plans.

Rep. Bonamici must not care about that.  

Biden’s student debt forgiveness policies also raise serious questions about fairness. For example, according to Penn Wharton, eliminating student debt for borrowers in repayment for more than 20 years (or for more than 25 years with graduate debt) will provide debt relief for about 750,000 individuals residing in households that, on average, earn $312,977 in annual household income.

There’s also inequity in Biden’s plan to cancel up to $20,000 in interest for borrowers who have accrued or capitalized interest on their loans since entering repayment.  Low and middle-income borrowers enrolled in the SAVE Plan or other income-driven repayment (IDR) plans would be eligible for their entire interest balance since entering repayment to be cancelled if they make:

  • $120,000 or less per year individually or as married filing separately
  • $180,000 or less per year as a head of household, or 
  • $240,000 or less per year as married borrowers who file joint taxes.

Real median personal income in the United States was only $40,480 and the national median household income was just $74,580 in 2022. In other words, many college educated borrowers in Bonamici’s district who are eligible for relief under Biden’s plan are hardly struggling. And despite her assertion that she’s “standing up for working families,” many of her constituents with much lower incomes will end up covering the bills of their better-off neighbors.

Then, of course, a lot of Bonamici’s responsible working family constituents have probably made sacrifices to pay down their student loans, foregoing vacations, nice cars and restaurant meals. They will get no benefits at all from Bonamici’s generosity. 

Tough beans for them, I guess.

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Justice Clarence Thomas and the Horatio Alger Association: What The New York Times Didn’t Tell You

On July 9, 2023, The New York Times ran a 4,314-word story about Supreme Court Judge Clarence Thomas’s connections with an exclusive club, the Horatio Alger Association of Distinguished Americans Inc.. 

“His friendships forged through Horatio Alger have brought him proximity to a lifestyle of unimaginable material privilege,” the reporters wrote, leading into multiple examples of benefits he received from a broad cohort of wealthy and powerful friends and insinuations that Thomas had been compromised.

Citing the Association’s website, the story said the non-profit group, portrayed as a group of wealthy and influential believers in meritocratic success, has awarded more than $245 million in college scholarships to roughly 35,000 students since its founding in 1947. The Association has been tax-exempt since Oct. 1952.

What the reporters didn’t do was look deeper at the Association. It has quite a dubious history.

In 1988, while a business reporter at The Oregonian newspaper, I researched and wrote a story about the Association, which had inducted two prominent Oregonians. The story (which won plaudits from the Columbia Journalism Review) noted that from 1985 through 1987 — the latest period for which tax records were available at the time — the Association raised $2.1 million. During those three years, The organization spent $1.7 million. Just $315,000 of that went to scholarships.

Rather than funding scholarships, most of the association’s outlays went to executive salaries, office expenses, books devoted largely to laudatory stories of the members’ lives, annual banquets at places such as New York’s Waldorf Astoria Hotel and the Westin Galleria Hotel in Houston and contracts with a New York public relations firm.

The amount of salary and benefits going to the association’s executive director alone, which increased from $98,126 in 1985 to $120,154 in 1987, exceeded or almost equaled the amount of scholarships awarded in each of the past three years. Those scholarships totaled $100,000 in both 1985 and 1986 and $115,000 in 1987.

In 1987 the Association spent more on printing and publications than on scholarships. Its principal annual publication was a hard-cover book titled “Only in America Opportunity Still Knocks.” The book devoted 132 of its 192 pages to a membership list and biographies featuring informal snapshots of the members and outlines of their paths to success.

A review of the Association’s recent federal tax filings reveals it still engages in questionable financial behavior.

The IRS requires that tax-exempt organizations, nonexempt charitable trusts, and section 527 political organizations file an annual Form 990 to provide the IRS with the information required by 26 U.S. Code § 6033. In its recent filings it stated its purpose as: “(1) To provide scholarship assistance to help promising high school students (who fit the Horatio Alger profile) attend college, and (2) to spread the message that America’s free enterprise system provides the greatest opportunities in the world for personal achievement and success.”

The Alexandria, VA-based Association’s recent Form 990s (2020, 2021) reveal it has grown substantially since I wrote about it in 1988, reporting total revenue of $27,092,429 in 2020 and $20,322,852 in 2021. But its scholarship distributions still fall far short of its annual revenue.

In 2020, its scholarship grants totaled $11,223,951, just 41% of its revenue. In 2021, grants totaled $12,287,913, 60% of its revenue, which was at least better than in 2010, when its revenue totaled $19,682,336 and its grants to individuals totaled just $4,721,307.

Where has all the rest of its revenue gone?

In 2021, a whopping $2,446,876 went to salaries, other compensation and employee benefits, including $1,348,080 to Executive Director Terrence J. Giroux. Another $318,936 went to a Philadelphia, PA public relations firm, Brian Communications. A total of $552,717 was spent on “event management”, slightly less than the $1,062,380 spent on event management and production in 2020. (The Association’s Form 990s say some of that money went to Linder & Associates, but that is a property management company in Los Angeles, California. The money probably went, instead, to Linder Global Events, an event management agency based in Washington, D.C.)

The Red Bank Film Factory of Red Bank, NJ was paid $471,271 and Destin Productions LLC of Limassol, Cyprus took in $330,000 for a television marketing campaign in 2021

Another $8,527,523 went to “Other Expenses”, including legal, accounting, advertising, office expenses, travel, conferences, conventions and meetings. 

According to the Association’s 2021 Form 990, $2,739,296 went just to “Member support and meetings, including the annual board of directors meeting, annual awards week in Washington, D.C. and specialized forums.”

In other words, given the amount of its revenue, the Association falls far short of expectations in its scholarship handouts, while spending extravagant sums on compensation and other functions, such as public relations and fancy dinners for its mostly wealthy members. 

Media coverage of the Association, while frequently citing its distinguished members, such as author Maya Angelou, former Intel CEO Craig Barrett, Michael Bloomberg and NBC News anchor Tom Brokaw, also has failed to mention that its ranks include some questionable characters, such as:

  • Roger Ailes, who resigned as chairman and CEO of Fox News after being accused of sexual harassment by several female Fox employees, including on-air hosts
  • Elizabeth Holmes, former CEO of Theranos. Holmes was convicted in 2022 on four counts of wire fraud for swindling doctors and patients to use her company’s blood-testing services while knowing that Theranos was incapable of producing accurate results, according to the indictment. She was also accused of defrauding investors of more than $700 million with the fabricated claims.
  • Joe Allbritton, a Washington, D.C. power-broker who turned a blind eye to evidence that Riggs Bank, of which he was  chairman and chief executive officer, was “handling the proceeds of foreign corruption and paid paid a $16 million criminal fine over charges the bank had failed to report suspicious transactions with foreign account holders.” The judge who imposed the fine described the bank as “a greedy corporate henchman of dictators and their corrupt regimes.”

America loves stories about someone picking themselves up by their bootstraps, as in Horatio Alger’s books about  impoverished boys and their rise from humble backgrounds to lives of success, although, truth be told, you can’t really do that. Truth be told, the Horatio Alger Association of Distinguished Americans Inc. isn’t all it’s stacked up to be either.