Current Events in October 2015

Are you still running Windows 7 or 8 because you like it? Too bad. Microsoft says it's time for you to upgrade to Windows 10 and is taking steps to make it almost automatic.

Beginning in 2016, Microsoft is adding the upgrade to Windows Update. Currently, users can either accept all the updates automatically or be notified that updates are available, then pick and choose what they want to load.

“Early next year, we expect to be re-categorizing Windows 10 as a Recommended Update,” Microsoft's Terry Myerson writes on the company blog. “Depending upon your Windows Update settings, this may cause the upgrade process to automatically initiate on your device.”

Users still have some control

However, Myerson says before the upgrade changes the operating system of your device, you will have the chance to choose whether or not to continue. If you do go ahead with the upgrade, which Microsoft strongly recommends, you'll have 31 days to go back to your old operating system.

“We understand you care deeply about what happens with your device,” Myerson said. “This is why – regardless of your upgrade path – you can choose to upgrade or decline the offer. That being said, we would encourage everyone to upgrade because Windows 10 is the best Windows ever – familiar, safer, faster, and full of innovations.”

Microsoft says it is encouraging the rapid move to Windows 10 because it says the new operating system has better security and more features than older versions of Windows.

Computer users might be a little sensitive because of what Microsoft admits was a mistake in mid-September and has moved to correct.

According to Computer World, Microsoft began pre-selecting the optional upgrade to Windows 10 in its update, resulting in the download and installation of the new operating system on a number of computers running the older operating systems.

“A bug perhaps,” writes Computer World's Gregg Keizer, “but one that Microsoft will turn into a feature in 2016.”  

For months, travelers in security lines at airports have been pleasantly surprised to find themselves routed into one of the TSA Pre-Check lines for expedited processing -- no need to remove shoes, laptop, and so forth.

But those days are over. The Transportation Security Agency is ending the program, which means that from now, you'll need to pay $85 and go through a pre-screening procedure if you want to continue using the Pre-Check lines.

The reason? You may recall that a few months ago, an inspector general's report found that federal undercover investigators were able to smuggle simulated bombs or illegal weapons through security lines 95% of the time. 

As part of an effort to tighten security, TSA has shelved the program, known officially as "Managed Inclusion II" so that the Pre-Check lines will once again be for the exclusive use of those who've paid their dues and undergone the pre-screening.

The $85 fee and pre-screening are good for five years. More information is available here.

It's been an eventful few weeks for daily fantasy sports enterprises like DraftKings and FanDuel.

First, there was an uproar over concerns that employees of the two fast-growing companies were unfairly profiting from inside information when they played games on competing sites.

That concern resulted in the launch of a formal investigation by New York Attorney General Eric Schneiderman.

Next, the Nevada Gaming Commission ruled that daily fantasy sports games constitute gambling, and therefore need to be licensed if they want to operate in Nevada.

Now, there's concern that these highly popular games could be cutting into the revenue consumers spend on state-sponsored gambling – lotteries.

A survey by research group Leger asked people who play daily fantasy games – where they can win money by forming teams of actual players and get points based on how well the players perform.

Buying fewer lottery tickets

Among the 15% of U.S. adults who claim to have played daily fantasy sports this season, 61% said what they spend on fantasy games has reduced what they wager on lottery games such as Powerball, Mega Millions, Scratch, or Instant Games.

It turns out the people who play fantasy sports games are typically gamblers. In fact, 84% of fantasy sports players said they played a lottery game in the last month. Leger says that's more than twice the level of all American adults.

"Specific to state lotteries, this is an external factor contributing to a perfect storm," said Lance Henik, Senior Account Manager at Leger.

Smaller jackpots

First, he says, you have to consider the reduction in blockbuster jackpots from Powerball or Mega Millions that may have impacted cross-play for other games in many state lotteries.

Then, there's the preference among younger players for online gaming, especially for those platforms that allow players to put their “skin in the game.”

The bottom line, he says, is daily fantasy sports may pose a long-term threat to state lotteries, which the states depend on for revenue.

Incidentally, the Leger data shows that daily fantasy sports is cutting into the casinos. Leger says that could well explain why the state of Nevada ruled that daily fantasy sports games constitute gambling and should be licensed.

"It appears Daily Fantasy Sports is serving up a double economic whammy for state governments right now." said Simon Jaworski, Senior Vice President at Leger. "These fantasy behemoths are not currently filling the local coffers with tax, due to their private ownership, which when coupled with potentially lower tax revenue from the DFS player's reduced lottery and casino spending, it is certainly a situation worth monitoring."

The Federal Trade Commission is planning to study the marketing of e-cigarettes, the first step in a process that could eventually lead to tougher regulation of sales and advertising practices for the fast-growing industry.

The agency will first send information requests to e-cigarette marketers and will use the information as a basis for a report on the sales, marketing activities, and expenditures in this new and complex industry.

Since the mid-2000s, the sale of battery-powered e-cigarettes has grown rapidly in the United States. Rather than burning tobacco, e-cigarettes heat liquid containing flavorings and chemicals (usually including nicotine) to produce an aerosol that the user inhales. E-cigarettes are sold both online and in conventional brick-and-mortar stores, are available in both disposable and refillable models, and come in a range of different flavors and nicotine levels.

The FTC is seeking clearance from the Office of Management and Budget to collect information from the e-cigarette marketers, which is the first step toward conducting the study. It will publish a Federal Register notice seeking public comment on the proposed collection of information from approximately five large and ten smaller e-cigarette marketers.

Not a lot of movement in September in personal income or spending.

The Commerce Department's Bureau of Economic Analysis (BEA) reports personal income increased $18.6 billion -- or 0.1% -- in September. Disposable personal income (DPI), which is after-tax income was also up 0.1% or $19.2 billion.

On the spending side, personal consumption expenditures (PCE) edged up just 0.1% or $15.6 billion.

Money coming in

Wages and salaries fell by $3.7 billion in September, after shooting up $36.0 billion the month before. Within that, private wages and salaries were down $7.0 billion, while government wages and salaries increased $3.3 billion. Supplements to wages and salaries rose $3.3 billion.

Spending and saving

Personal outlays, which is made up of PCE -- personal interest payments and personal current transfer payments -- rose $13.7 billion last month, compared with an increase of $42.3 billion in August.

Personal saving -- DPI less personal outlays -- totaled $642.8 billion in September, compared with $637.3 billion the month before. The personal saving rate -- personal saving as a percentage of disposable personal income – was 4.8%; it was 4.7% in August.

The complete report is available on the BEA website.

Chrysler (FCA US LLC) is recalling 284,089 model year 2003 Jeep Liberty vehicles manufactured March 29, 2003, to July 3, 2003, and 2004 Jeep Grand Cherokee vehicles manufactured May 27, 2003, to May 20, 2004.

Due to electrical noise beyond the tolerance of the air bag electronic control module (ECM), a component in the ECM may fail, causing the front air bags, side air bags, and/or seatbelt pretensioners to deploy inadvertently while the vehicle is being operated.

Inadvertent deployment of the air bags may increase the risk of injury and the possibility of a vehicle crash.

Chrysler will notify owners, and dealers will replace the air bag electronic control module and the front and/or side impact sensors, as necessary, free of charge. The replacement parts needed for this remedy are not expected to be available until the early part of 2016. Owners will be mailed an interim notification by the end of December 2015 and will be mailed a follow up notification when new air bag control modules are available.

Owners may contact Chrysler customer service at 1-800-853-1403. Chrysler's number for this recall is R60.

Pottery Barn Kids of San Francisco, Calif., is recalling about 15,630 Avengers and Darth Vader-themed water bottles in the U.S. and Canada.

The gray paint on the metal portion of the water bottle can contain excessive levels of lead, violating the federal lead paint standard.

No incidents or injuries have been reported.

This recall involves Avengers and Darth Vader-themed stainless steel water bottles with images of Thor, The Incredible Hulk and Iron Man on one and an image of Darth Vader and the Death Star on the other.

The water bottles are gray with a blue or black plastic top, a vacuum-valve stopper and are 5 ½ inches tall by 2 ¾ inches in diameter. SKU number 7939721 (Avengers) or 7939721 (Darth Vader) is printed on the price sticker affixed to the bottom of the bottle, along with one of the following date codes: 12/2013, 8/2014 or 12/2014.

A tracking label imprinted on the underside of the bottle contains the date code printed along with the words, “Pottery Barn Kids,” “LOT 1, BATCH 1” and “JINHUA, CHINA.”

The water bottles, manufactured in China, were sold exclusively at Pottery Barn Kids and Pottery Barn Outlet stores nationwide, through the Pottery Barn Kids catalog and online at www.potterybarnkids.com from June 2014, through September 2015, for about $16.

Consumers should immediately take the recalled water bottles from children and return them to the nearest Pottery Barn Kids store or contact the firm’s toll-free number for free shipping information. Consumers will have the option of a full refund or replacement water bottle, plus a $20 Pottery Barn Kids gift card.

Consumers may contact Pottery Barn Kids toll-free at 844-421-8062 from 7 a.m. to midnight (ET) daily, or online at http://www.potterybarnkids.com/customer-service/recall-water-bottle.html for more information.  

General Motors is recalling 1,003,556 model year 1998-1999 Chevrolet Lumina and Oldsmobile Intrigue, 1997-2004 Buick Regal and Pontiac Grand Prix, 2000-2004 Chevrolet Impala, and 1998-2004 Chevrolet Monte Carlo vehicles.

The recalled vehicles were previously repaired under recall to address the possibility that engine oil may drip onto the hot exhaust manifold. Engine oil that drips onto the hot surface of the exhaust manifold may result in a fire.

Because the remedy applied under the earlier recalls did not adequately remove the safety risk, GM is finalizing an improved remedy. Those vehicles will instead receive the improved remedy under the original recall number, once the improved remedy has been finalized. The manufacturer has not yet provided a notification schedule.

Until the improved remedy has been applied, owners are advised to park their vehicle outside since the fire risk exists even when the vehicle is unattended.

Owners may contact Chevrolet customer service at 1-800-222-1020, Buick customer service at 1-800-521-7300, Oldsmobile customer service at 1-800-442-6537 and Pontiac customer service at 1-800-458-8006. GM's number for this recall is 15757.  

American Honda Motor Co. is recalling 303,904 model year 2008-2009 Honda Accord vehicles manufactured January 22, 2007, to June 30, 2008.

The side impact sensor calibrations may be overly sensitive, and as a result, the side air bag inflatable curtains and/or seat air bags may unexpectedly deploy when the ignition is on and the door is slammed or there is an impact with road debris. Air bags that unexpectedly deploy increase the risk of a crash or injury.

Honda will notify owners, and dealers will update the air bag control unit software, free of charge. The recall is expected to begin on December 14, 2015.

Owners may contact Honda customer service at 1-888-234-2138. Honda's number for this recall is JV4.

You've probably heard of a prenup, and may have even signed one.

But what about a postnuptial agreement? Less well-known, these legal agreements are executed by a couple after they are already married. Some marriage therapists recommend them to smooth out a rocky marriage.

And they're becoming a lot more common. A survey of American Academy of Matrimonial Lawyer (AAML) members found half of divorce attorneys noted an increase in spouses seeking postnuptial agreements over the last three years.

The idea is to basically decide, in advance, what's going to happen when and if the marriage goes completely off the rails. Agreeing before things get really bad and emotions are inflamed, it is argued, makes things go better when the marriage does, in fact, hit the rocks.

Covers division of property

Ninety percent of respondents said the postnups they draw up cover division of property, with 73% said their postnups cover alimony and spousal support.

"A postnuptial agreement is usually produced from some kind of serious strain or emotional fracture that directly impacts the marriage,” said James McLaren, president of the American Academy of Matrimonial Lawyers. “It can represent a way for the spouses to move forward with a shared understanding about the ways in which certain subjects would be addressed in the event of a divorce."

McLaren says drawing up a postnuptial agreement can also be therapeutic for a couple. By deciding what the agreement should cover, he says the couple typically uncovers the things that are causing a lot of stress in the marriage. Also, putting it in a legal document removes some uncertainty that may be troubling one or both spouses.

What to do

If the subject of a postnup should be brought up, McLaren says both spouses need to tread carefully.

If you happen to be the one initiating the postnup, he says you need to carefully consider whether it would be better to proceed immediately with a divorce or try to salvage things with a legal agreement.

If your spouse brings it up, McLaren strongly recommends that you carefully consider all options and not make a decision that could be influenced by guilt.

MaritalMediation.com, a website supporting mediators, divorce attorneys, and counselors, says a postnup may help a couple preserve their marriage. It encourages couples to work together in a collaborative effort and avoid adopting "the 'boilerplate' of a lawyer."

There is no doubt that one reason new car sales have surged in recent years is the cars rolling off the assembly line have gotten better and more fun to drive.

There are new safety features and connectivity in the cabin that links many smartphone apps with the vehicle navigation and entertainment systems.

But if technology is a major reason you're considering a new car, you shouldn't overlook a late model used one. Automotive site Edmunds.com has done some research and found that many of the same technology features found on new cars are also available on many late model used cars, at thousands less.

"Many shoppers will be surprised to learn how many used cars currently available are loaded with advanced technology," said Edmunds.com Senior Consumer Advice Editor Ron Montoya. "Buyers looking at certified pre-owned cars or those in the two- to three-year-old range, for example, are very likely to find technology that's comparable with what can be found on a new-car lot."

To find a used car with the technology you want, you need to know when different carmakers began adding them, either as standard features or options. Edmunds has done the research.

Bluetooth

Bluetooth, the wireless technology that syncs your mobile device to the car's audio system, is among the most popular automotive technologies consumers seek. It exploded as a feature in 2009, with 81% of all models offering the technology as either standard or optional — up from just 47% the year before.

Starting your vehicle search with the 2009 model year means you should be able to purchase a car with Bluetooth technology for less.

Back-up cameras

Back-up cameras are another popular feature. They appeared as options in 2005 but, by 2010, began to be more common as standard equipment.

Cameras are valued as important safety equipment, especially for parents of small children. Insurance companies like them too, since they help avoid fender benders in shopping center parking lots.

Edmunds says by the 2010 model year, back-up cameras were available as standard or optional equipment in 58% of all available models.

Blind-spot monitoring

Blind-spot monitoring is a more recent technology, but Edmunds says consumers can find it on some used cars, starting with the 2013 model years. Edmunds calls it “an incredibly helpful technology” that is often found on many midsize sedans and SUVs.

The system displays a lit icon in the vehicle's side mirrors to let the driver know that it is not safe to turn or change lanes. By the 2015 model year, the feature was available on 50% of all cars.

Adaptive Cruise Control

Adaptive cruise control is another recent technology, also debuting in the 2013 model year. The feature automatically detects the speed of the vehicle ahead and reduces your car's speed to keep a safe distance.

This feature is still only offered as an option on less than half of all of today's new cars but, like blind-spot monitoring, the technology was available as a standard or optional feature in about one-third of vehicles in the 2013 model year. However, Edmunds says you'll mostly find it on luxury brands or top-of-the-line mainstream models.

Keep in mind the model years are simply a place to start. Consumers need to thoroughly research a potential used car purchase to determine whether the technology was standard that year or an option. In other words, not all used cars in that model year will have the desired equipment.

It wasn't so long ago that the value of the average condominium was crashing hard. During the housing market meltdown, these units lost value at an alarming rate.

Fast forward to today, and you'll find condos are gaining value at a faster rate than single-family homes in many areas of the country. A report by real estate marketing site Zillow shows condo values are up 5.1% compared to 3.7% for single family homes.

It's not hard to figure out why. Single-family homes have already gained back a lot of their value since the depths of the Great Recession. In a way, condos are simply catching up.

Demographics

But demographics also play a role. Since condos are often an entry-level home purchase, the recent pick-up in first-time home buyers means more demand for condos.

Condos also tend to be numerous in urban areas, and cities are where young Millennials want to be. Zillow data shows that condo values outpaced house values the most in the New York City metro area, in Dallas and Houston, and in Boston and Denver.

Denver is one of the hottest housing markets in the nation. Condo values are up a head-spinning 20% there, rising 4% faster than single-family homes. It's earning condos new respect among real estate professionals.

Better investment now

“The housing bust hit condo values hard, and over the past few years, buying a condo wasn’t always considered a good investment compared to a single family home,” said Zillow Chief Economist Dr. Svenja Gudell. “But that’s changing, and condos increasingly represent a strong-performing, often affordable choice, particularly for first-time buyers interested both in homeownership and in keeping a lower-maintenance, city lifestyle.”

That's not to say there aren't some extra costs associated with owning a condo. Home Owner Association (HOA) fees can be high for some developments, but even with those fees the bottom line can often compare favorably with rents.

A report by Zillow's sister site Trulia notes that rents for a one-bedroom apartment can run between $2,000 and $4,000 a month in San Francisco and New York.

In Philadelphia, a market where many people who rent are saving up to buy, demand for condos has driven up prices by 2.3%. At the same time, the value of single-family homes dipped slightly.

Pending home sales seem to be running out of gas, posting their second decline in as many months in September.

Figures released by the National Association of Realtors (NAR) show the Pending Home Sales Index Pending (PHSI) fell 2.3% to 106.8 -- the second lowest index reading in 2015. All four major regions experienced a pullback in activity in September.

At the same time, the PHSI is 3.0% above its year-ago level and has increased year–over–year for 13 straight months.

A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

A variety of factors

"There continues to be a dearth of available listings in the lower end of the market for first–time buyers, and Realtors in many areas are reporting stronger competition than what's normal this time of year because of stubbornly low inventory conditions," said NAR Chief Economist Lawrence Yun. "Additionally, the rockiness in the financial markets at the end of the summer and signs of a slowing U.S. economy may be causing some prospective buyers to take a wait–and–see approach."

Despite contract activity softening from the more robust levels seen earlier this year, Yun believes the housing market will still likely be one of the brighter spots in the economy in coming months.

"With interest rates hovering around 4%, rents rising at a near eight-year high, and job growth holding strong -- albeit at a more modest pace than earlier this year -- the overall demand for buying should stay at a healthy level despite some weakness in the overall economy," Yun added.

Regional performance

• The PHSI in the Northeast fell 4.0% to 89.6 in September, but is still 3.9 percent above a year ago.
• In the Midwest the index was down 2.5% to 104.7, but stayed 4.3% above September 2014.
• Pending home sales in the South dipped 2.6% to a reading of 118.3 and have now fallen 0.1% below last September.
• The index in the West inched down 0.2% to 104.4, but remains 6.6% above a year ago.

Growth in the U.S. economy slowed significantly during the third quarter following a robust increase in the previous three months.

The Bureau of Economic Analysis reports real gross domestic product (GDP) -- the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes -- increased at an annual rate of 1.5% in the July – September quarter of 2015. Real GDP shot up 3.9% in the second quarter.

It should be noted that this is an “advance” and that the source data will be revised two more times as more information becomes available. The "second" estimate is due out on November 24.

Positives and negatives

The increase in real GDP is a reflection of positive contributions from personal consumption expenditures (PCE), state and local government spending, nonresidential fixed investment, exports, and residential fixed investment. Those were partly offset by a decline in private inventory investment. Imports, which are a subtraction in the calculation of GDP, increased.

The slowdown in the rate of growth came from, in addition to the previously-mentioned downturn in private inventory, decelerations in exports, nonresidential fixed investment, PCE, state and local government spending, and residential fixed investment that were partly offset by a deceleration in imports.

Personal saving -- disposable personal income less personal outlays -- was $636.7 billion in the third quarter, compared with $617.5 billion in the second. The personal saving rate -- personal saving as a percentage of disposable personal income -- was 4.7% in the third quarter, compared with an increase of 4.6% in the second.

The complete GDP report is available on the Commerce Department website.

Jobless claims

First-time applications for state unemployment benefits were up a tad last week.

According to the Department of Labor (DOL), initial jobless claims rose 1,000 in the week ending October 24 to a seasonally adjusted 260,000. The previous week's total was unrevised, and DOL says there were no special factors affecting the latest week's initial claims.

The four-week moving average, which is less volatile than the weekly accounting and considered a more accurate gauge of the labor market, came in at 259,250 -- down of 4,000 from the previous week and the lowest level for this average since December 15, 1973.

The full report may be found on the DOL website.  

Adolf’s Meat Products of Hartford, Conn., is recalling approximately 224 pounds of assorted meat.

The products maybe adulterated with Listeria monocytogenes.

There are no confirmed reports of adverse reactions due to consumption of these products.

The following items, produced on Oct. 20, 2015, are being recalled:

• 14-lb. of Smoked Kielbasa
• 100-lb. of Hams
• 40-lb. of Canadian Bacon
• 30-lb. of Bone-In Pork Loins
• 50-lb. of Liverwurst

The smoked kielbasa products bear establishment number “EST. 34651” inside the USDA mark of inspection, while the others were sold from behind a deli counter without labels. All recalled products were sold at Adolf’s Meat & Sausage Kitchen in Hartford, Conn.

Customers who purchased these products should not consume them, but throw them away or return them to the place of purchase.

Consumers with questions may contact Joseph Gorski at (860) 522-1588.

BMW of North America is recalling 6,073 model year 2014-2016 MINI Cooper S and MINI Cooper two-door vehicles, 2015-2016 MINI John Cooper Works and MINI Cooper S and MINI Cooper four-door vehicles, and 2014-2015 BMW i3 vehicles.

Due to a manufacturing error, the front passenger air bag may not deploy properly in a low speed crash. Thus, these vehicles fail to comply with the requirements of Federal Motor Vehicle Safety Standard (FMVSS) number 208, "Occupant Crash Protection." An air bag that fails to deploy properly increases the risk of injury to the front seat passenger.

MINI and BMW will notify owners, and dealers will replace the passenger frontal air bag module, free of charge. The recall is expected to begin on November 20, 2015.

Owners may contact MINI customer service at 1-866-825-1525 and BMW customer service at 1-800-525-7417.

Burley Design of Eugene, Ore., is recalling about 34,820 child bicycle trailers in the U.S. and Canada.

Trailers with black plastic tow bar receivers can separate from the tow bar when they appear to be connected, posing a crash hazard to the child in the trailer.

The company has received 35 reports of trailers with black plastic tow bar receivers separating from the tow bar, including two incidents that resulted in abrasions to a child.

This recall involves seven models of Burley Design child bicycle trailers manufactured from 2009 to 2015. The trailers allow cyclists to tow children behind their bicycles while riding.

The trailers are connected to the bicycle by a tow bar, which attaches to the rear axle of the bicycle on one end and to a tow bar receiver on the trailer at the other end. The tow bar receiver is on the front left side of the trailer as it faces the rear wheel of the bicycle.

Recalled trailers have a black plastic tow bar receiver with an integrated wheel guard and can be identified by the first four characters of the serial numbers on the trailer. The serial number is on a sticker in the rear cargo area behind the seat of the trailer on the left inside frame bar.

The following seven trailer models and serial numbers are being recalled:

The trailers, manufactured in China, were sold at REI, Sport Chalet and other sporting goods stores and bike shops nationwide, and at Amazon.com and other online retailers from January 2009, to October 2015, for between $300 and $700.

Consumers should immediately stop using the recalled bicycle trailers and contact Burley for a free safety strap kit with tools and instructions for installation and a coupon for a 20% discount on the purchase of any Burley accessory. Consumers should also inspect the black plastic tow bar receiver. If it appears to be cracked or damaged, consumers should also request a free replacement tow bar receiver.

Consumers may contact Burley Design at 800-311-5294 from 8 a.m. to 5 p.m. (PT) Monday through Friday or online at https://burley.com/recall/. 

The plight of teachers whose federal grants are suddenly -- and in thousands of cases wrongfully -- converted to delinquent loans is a problem that education bureaucrats know about but have chosen to ignore, although the issue is beginning to percolate in Congress.

"We have a real problem here,” said Rep. David Joyce (R-Ohio) in a recent letter to Secretary of Education Arne Duncan. “Programs to help ease the burden of teacher loans all too often don’t accomplish that goal. Instead, they end up leaving many qualified candidates with costlier loan payments and more debt. It’s time to create a more effective approach that gives teachers the support they need to make a difference in the lives of kids everywhere.”

The TEACH Grant Program was established by Congress to encourage more teachers to go to “high-needs” schools and teach subjects that are critically important to students’ success. But many teachers who have lived up to their end of the deal now find themselves burdened with additional debt.

"This is an advertised federal program to help people become teachers. In reality, it's a for-profit scam," said David West, a South Carolina teacher whose grant was converted to a loan because of a minor administrative error, as reported in a recent ConsumerAffairs story.

2,252 errors & counting

The accounts of West and other young teachers are no surprise to the Government Accountability Office (GAO), which reported in May that, as of September 2014, at least 2,252 TEACH grants had been erroneously converted to loans. “Education officials said they now monitor the [loan] servicer more closely and plan to review all of the nearly 36,000 of the program's grant-to-loan conversions, but the agency has not systematically reviewed the cause of the errors,” GAO said.

West and other teachers say their grants of $4,000 or more -- awarded to them for teaching in “high-needs” schools -- were converted to delinquent interest-bearing loans even though the teachers were doing everything they were required to do but had made simple administrative errors in filling out the annual paperwork the grants require.

The teachers appealed the conversions, but their appeals were denied, something else that would not come as news to the GAO examiners. In their March 2015 report, they wrote that the Department of Education “established a dispute process to address concerns about TEACH grants converted to loans in error; however, GAO found that Education and the servicer provide incomplete and inconsistent information to recipients about the availability of and criteria for disputing conversions.”

GAO said such conduct is “inconsistent with federal internal control standards that highlight effective external communication.”

Agreed but did nothing

GAO recommended that the Education Department “examine why erroneous TEACH grant-to-loan conversions occurred, disseminate information on the TEACH grant-to-loan dispute process, and establish program performance measures.”

The department said it agreed with GAO's recommendations, but that is little comfort to the thousands of teachers who find themselves rewarded for their efforts by being plunged into debt and threatened in harsh letters telling them their credit ratings will be affected and their income tax refunds may be seized.

No one has bothered to tell them of the 2,252 errors or to assure them their cases will get a second look.

The TEACH grants are administered by FedLoan, a Pennsylvania state agency that is part of a larger agency whose primary responsibility is providing grants to Pennsylvania students. A spokesman for that agency said he could not comment and referred inquiries to the Education Department, which did not respond to repeated requests for comment.

Congress takes note

The issue is drawing the attention of several members of Congress, however. On May 7, Joyce joined with Sens. Orrin Hatch (R-Utah) and Mark Warner (D-Va.) and Rep. Derek Kilmer (D-Wash.) in a letter to Secretary of Education Arne Duncan noting the problems with the TEACH grants and other programs and saying they “look forward to working with [him]” to improve the programs.

“Unfortunately, our current federal grant and loan forgiveness programs for teachers are a jumble of uncoordinated programs that are often too difficult to navigate. We have a responsibility to our teachers, students, families and taxpayers to do better,” Sen. Warner said.

Duncan, one of the longer-serving members of President Obama’s cabinet, announced earlier this month that he plans to step down in December. Duncan, a former basketball player, said he plans to return to Chicago and  “continue to involve the work of expanding opportunity for children” but gave no indication he would do anything about the TEACH grants.

You might think of the federal government as your protector against abusive debt collection practices and robocalls to your cellphone. But if a provision in the federal budget bill now before Congress becomes law, robocalls to cellphones would be fair game for anyone collecting a debt guaranteed by the federal government.

That, say consumer advocates, could open the floodgates for calls to student loan borrowers, mortgage borrowers, taxpayers, and others with debt backed by the federal government. Calls could also be made to borrowers' relatives, their references, and anyone unlucky enough to have a reassigned cell phone number on a collector's list. 

Section 301 of the budget bill removes the current requirement for a caller to have the consent of the called party before making autodialed or prerecorded calls or texts for the collection of debts owed or guaranteed by the federal government. It also removes the ability of the called party to stop these unwanted robocalls to their cellphones.

"A terrible idea"

"Giving one of the most abusive industries in the U.S. free rein to inundate people with robo-calls to their cellphones is a terrible idea," said Margot Saunders, of the National Consumer Law Center in a prepared statement. "Cell phone calls can distract people while driving, interrupt them at their jobs, and needlessly impose a cost on struggling families by using up scarce minutes. Debt collectors regularly call land lines to harass and threaten friends, family, and even strangers with similar names to the debtor. No one will be safe from receiving abusive calls on their cell phones if this provision goes through."

The Federal Communications Commission received more than 215,000 complaints related to unwanted calls in 2014. As a result, the Commission adopted stronger regulations to better protect consumers from unwanted robocalls and texts this past June.

"The Fair Debt Collection Practices Act badly needs updating but for the purposes of protecting consumers from widespread harassment and debt collector abuses, not for facilitating those abuses," Saunders noted, "and we hope that the Consumer Financial Protection Bureau, which is considering stronger rules, will move to rein in these type of abuses."