Will Dodd-Frank Prevent New Megabanks?

On August 22, 2011, In Congress, Corporations, Current Leadership, By Donny Shaw

Last year’s Dodd-Frank financial reform bill didn’t directly fix the too-big-to-fail problem that necessitated the 2008 bailouts. Instead, it allowed the big banks to grow even bigger, but gave regulators new authority to require the big banks to report more information to the government and force them to follow stricter rules. It also gave regulators new guidelines to consider when deciding whether or not to allow bank mergers that could create new too-big-to-fail entities. Basically, the bill took a noncommittal approach to addressing issues of bank size and interconnectedness. Congress punted the big decisions off to regulators and made it possible for regulators to take drastic action, but gave them a lot of leeway to maintain the status quo if they so choose.

These provisions of the bill are about to get their first big test. Capital One, currently the ninth largest bank-holding company in the U.S., has reached an agreement with the Ducth ING Groep to purchase their U.S. arm, ING Direct. They are planning to then turn around and leverage assets gained in that deal to purchase HSBC’s subprime credit card division. The acquisitions would make Capital One the fifth largest bank in the U.S., right behind such infamous too-big-to-fail giants as Bank of America, Chase, Citigroup, and Wells Fargo. It would mean that financial assets and power in the U.S. would become even more concentrated in a small group of top corporations.

In Section 163 of Dodd-Frank, the Federal Reserve Board of Governor’s is given new guidelines to consider when deciding whether or not to approve the acquisition of one large bank by another large bank. “The Board of Governors shall consider the extent to which the proposed acquisition would result in greater or more concentrated risks to global or United States financial stability or the United States economy,” the bill states.

This language is typical of the bill. Far from being a dictate from Congress (i.e. no mergers that will create new banks with more than $xxx in assets), it doesn’t even give the Fed a specific directive to reject an acquisition that would result in more concentrated risks. But it clearly does provides them with justification to reject it on those grounds.

In June, Fed Board of Governors member Daneil Tarullo said that regulators should oppose mergers that increase risk in the financial system unless there is a significant public benefit. “The regulatory structure for SIFIs [systemically important financial institutions] should discourage systemically consequential growth or mergers unless the benefits to society are clearly significant.” So far, though, it’s not clear what the public benefit of a bigger Capital One might be. Recent research from the New York Times shows that Capital One has basically eliminated their small business lending in recent years. In 2006, they approved $228 million in small business loans, but by 2010 that lending had been reduced to just $600,000 nationwide. It’s by far the most dramatic drop-off in small business lending by any of the top-25 banks the Times looked at.

The National Community Reinvestment Coalition is running a letter-writing campaign asking the Federal Reserve to extend the public comment period on the acquisition by 60 days and to hold public hearings in at least 5 major cities before the deal is approved or rejected. “If the Capital One acquisition is approved without substantial regulatory review, it will signal a continuation of a regulatory culture that brought us the foreclosure crisis, the financial crisis and financial institutions that were Too-Big-to-Fail and are even bigger today,” they write. They’re asking for letters to be submitted by August 22nd.

Cross-posted from Open Congress.

 
0 Comments
Leave A Response

Revolving Door Makes Lobbying Cheaper and More Effective

On June 15, 2011, In Background and Research, Congress, Corporations, By Donny Shaw

Cross-posted from Open Congress Blog.

The conclusions will probably come as a surprise exactly none of you, but a new study from the International Monetary Fund on the influence of campaign donations and lobbying politics is worth a mention because of the completeness of the research and the authority of its source. Two IMF economists, Deniz Igan and Prachi Mishra, have been examining how the targeted political activities of financial corporations between 1999 and 2006 affected how Congress voted on bills that strengthened or loosened regulation of Wall Street leading up to the 2008 crisis. They found — surprise! — that the more the corporations spent on campaign donations and lobbying, the more likely Congress was to vote in favor of deregulation. Furthermore, they found that the money Wall Street spent on lobbying members of Congress who were connected to Wall Street, either from having worked there in the past or through a former staff member who had gone through the revolving door to K Street, had a much stronger effect on their voting than on those who had no Wall Street connections.

A preliminary version of the economists’ research paper, replete with detailed methodology information, can be found here (happy to see OpenCongress mentioned as a data source). Some of their key findings were summed up recently in an article for the June edition of the IMF’s Finance & Development magazine, here. And Dan Froomkin written it up at HuffPost, here.

The most significant finding is the extent to which the revolving door influences Congress’ voting patterns. According to the study, Wall Street companies that used lobbyists who had worked for the member of Congress they were lobbying made the targeted lawmaker 20% more likely to vote how the firm wanted than the average lawmaker, and about 9% more likely than lawmakers who were lobbied by unconnected lobbyists (column 1 at right). Furthermore, when companies used lobbyists who were connected to the member of Congress they were targeting, they were able to spend less to have the same impact. The amount of money spent by companies with connected lobbyists did not affect voting (column 3). Apparently it’s just the connection that matters, not the number of trips to the Hill.

Coincidentally, Talking Points Memo has just updated their “Shadow Congress” database, tracking former members of Congress who now work for lobbying shops, and the revolving door is definitely trending up. By TPM’s count 195 former lawmakers now work on K Street — up from 172 one year ago — including several very powerful Democrats who were defeated in the 2010 midterms.

Given the influence of the revolving door, there has been very little discussion in Congress on reforming the system. In 2007, as part of a larger ethics overhaul bill, Democrats passed a loophole-laden two-year “cooling off” period before ex-lawmakers and staff members could become registered lobbyists. In the past 6 years, only one bill has been introduced to expand those restrictions. Sen. Michael Bennet’s [D, CO] “Close the Revolving Door Act of 2010” proposed, among other things, to permanently ban members of Congress from ever joining lobbying firms. It attracted one co-sponsor before dying in committee.

 
0 Comments
Leave A Response

A Sustainable Economic Vision

On September 15, 2010, In Congress, Corporations, Current Leadership, free markets, freedom of expression, The Public, By Tiffiniy Cheng

Our Years Ahead

This fall there are lots of candidates without a sustainable economic vision. We need to make sure they get there – they should decide today to support these 5 policy proposals that address our immediate and future needs. Polling shows that there is wide public support for these proposals – there is no good reason they should not become law.

We have five questions we hope you, our best advocates, will ask your local candidates. Call them up, and report back your answers in the comments.

We generally support candidates that will hold the big banks accountable and prevent the reckless behavior that caused the economy to collapse and cost 8 million Americans their jobs. We vote for candidates that have a vision of a stable, growing economy populated by millions of small and medium sized businesses rather than big business speculation, regionally-based industry, healthy competition, rising wages, and one that supports innovation in industry and stability in the workforce. This may sound ambitious during a time of recession, but as history has shown, the only way out of this recession is to dream big and try big projects, in the best American tradition.

1. Full employment: Do you support Rep Conyers’ proposal of a deficit-neutral program that funds jobs with a tax and curbing of Wall Street transactions?

In a healthy economy, everyone who can work and wants to work should be able to find a job. It is highly wasteful, and bad for communities, family, and human dignity to have a 10% unemployment rate. When the economy goes through a recession, rather than spend our tax dollars that go to CEO pay, the government should invest directly in jobs – hire people to fix bridges, teach under-staffed schools, refit homes to make them energy neutral, lay train tracks, and build wind turbines. We support President Obama’s proposal to put people to work building a 21st century roads and rail system. We also support Rep. Conyers’ proposal of a deficit-neutral program that funds jobs with a tax and curbing of Wall Street transactions.

[A February 2010 Lake Research poll showed “solid pluralities, including among independents, prefer the (progressive) Democratic position on job creation and putting Americans back to work to the GOP’s (46% of Democrats)”]

2. Financial Transactions Tax: Do you support legislation sponsored by Tom Harkin and DiFazio for a financial transactions tax?

We support legislation sponsored by Tom Harkin and DiFazio that would make banks pay a tax on the casino culture of Wall Street. This is a sales tax on their sales of complicated financial instruments.  To pay for our deficit and social programs, we should make banks pay a sales tax on their sales of exotic financial instruments. Economists think even a tiny such tax (less than 1%) could bring in between $250 billion and $350 billion/year, which would help pay for new teachers, modernize millions of homes to make them more energy efficient, shrink our financial sector, and meet the tax shortfall of our cities and towns since the financial crisis.  This would help prevent another crisis by discouraging transactions that have no real value, and will help reduce the deficit. Opponents won’t support the tax because they work for Wall Street, not the people.

[A January 2010 poll showed that 81% of Americans agree with the
following strongly worded statement. “We need to rein in the greedy, reckless behavior of the big banks on Wall Street that cost millions of jobs and led to huge bailouts on our dime. This tax will put a limit on the casino culture of Wall Street that provides no real value and only exists to line the banker’s pockets. This reform will strengthen our financial system to help prevent another crisis and reduce the deficit.” ]

3. Break up the Banks: Do you support legislation that would break up the too big to fail banks?

We support legislation that would make sure no more banks get to be too big to fail and require government bailouts. Opponents want all the “Too Big to Fail” banks to continue to suck huge profits out of innocent people, receive taxpayer handouts for their dangerous risk taking, and destroy our economy. Our small and medium banks tend to serve their customers better and take on less risk. Breaking up our largest financial institutions opens up the industry to greater competition from small and medium banks, leading to better products for consumers and more small business lending. It would also help to limit the financial industry’s corruptive influence over federal policy making.

[ In a January 2010 Lake Research poll, Americans gave a 6.9 out of 10 rating (very to absolutely the most important reform) in a measurement of the importance of different reform proposals to “cap[ping] the size of banks and financial firms to prevent them from becoming so big that taxpayers would need to bail them out in a crisis”. A May 2010 Fox News poll showed that 69% of Americans favor new stricter controls and regulations on Wall Street and financial services industry, 20% oppose.  ]

The Mortgage Crisis

4. Housing Market Reset: Do you support legislation sponsored by Jeff Merkley that would make sure that the big banks do not get to make homeowners pay all the cost of the bad and deceptive deals they make. Instead, they should have to renegotiate for fair home prices?

Legislation sponsored by Jeff Merkley would make sure that the big banks do not get to make homeowners pay all the cost of the bad and deceptive deals they make. Instead, they should have to renegotiate for fair home prices. Foreclosures are bad for employment, bad for communities, bad for people, and they leave homes wasting. The banks that got the government to bail them out should have to come to the table.

[In a May 2010 CBS News poll showed that 56% of Americans think the government should help homeowners with mortgage issues.  “Americans disapprove of the government bailing out the banks and U.S. automakers, but they support help for ailing homeowners.”]

5. Right to Rent: Do you support the proposal made by economist Dean Baker that people who bought their homes for far more than they were worth should have the right to stay in their homes if they pay fair market rental value for them?

We support the proposal made by economist Dean Baker that people who bought their homes for far more than they were worth should have the right to stay in their homes if they pay fair market rental value for them. Many homeowners are under water at no fault of their own. For every homeowner helped by HAMP to avoid foreclosure, 10 were foreclosed on – this proposal keeps people in their homes but does not cost the taxpayer a dime. This would help save our communities from the blight of foreclosure, and encourage care and investment in homes, while forcing the big banks to negotiate with innocent home owners.

["Homeowners who are simply underwater would likely be able to afford market rents," says Ingrid Gould Ellen, an economist at New York University who helped current Housing and Urban Development secretary Shaun Donovan]

Please tell us what you hear in the comments.


What a Sustainable Economic Vision Looks Like

We are at a historic moment in our history. There are two completely different visions of our future economy.

The unsustainable vision is an economy dominated by a few dozen enormous corporations. Proponents believe that when big business does well, everyone else does well. This vision rewards debt-fueled growth, unproductive speculation, and overly concentrated power. We’ve already seen where that leads us–instability, crisis, unemployment over 10% in much of the country, empty homes, wasted jobs, overpacked schools, uncertainty and unhappiness and severely divided social classes.  This is our recent past, and this is our current economy. Republicans and some Democrats openly admit they plan to support loopholes that make it easier for Wall Street and big business to keep doing business as usual. They continue to gamble away our jobs, retirement funds, homes, city and state budgets, and tax dollars – and it is dangerous.

The sustainable vision is one built around fair wages and good jobs, with millions of small and medium sized businesses, regionally-based industry, healthy competition, rising wages, innovation in industry and stability in the workforce. We’ve already seen where this leads us — better, more secure jobs, great schools, creativity, community, stable lives that allow for innovation, and social mobility. This is our post-war America, where we overcame Jim Crow and created industries that spread throughout the world. We plan to take on the big banks that broke the economy and make sure they pay to rebuild our country.

A healthy economy builds on our traditional strengths as a country, where we nourish individual entrepeneurs and local investment. Small and medium businesses tend to care more for their workers, be more attentive to environmental concerns, and don’t get the same tax breaks and poltical muscle of big businesses. While big business is a threat to democracy, small business is its partner. A healthy economy values rising wages over lowering wages, and includes a high degree of local manufacturing, so that foreign prices can’t destabilize the basic market.

We should aim for a less speculative economy than the one we’ve had for 30 years – it leads to maximum employment, better jobs, an increasing living standard, more socially beneficial innovation, and a sound social and economic infrastructure. Less of our economic activity should be tied up in risk, we should be investing in humans and the infrastructure we need to lead healthy lives.

There is no question that people are suffering and looking for something to blame. Foreclosures are destroying communities, but also people’s dignity. Republicans are blaming immigrants, and the qu’aran, and democrats, but the real culprit is big banks and corporate handouts. There is plenty of money that can flow in the economy, it is just in the wrong place. We can decide to take history by the horns, and reward education instead of speculation, and small business instead of corporate takeovers.

More policy demands will be posted shortly.

 
26 Comments
Leave A Response

COUNTDOWN TO COLLAPSE: The Recovery is Not Recovering

On August 13, 2010, In Congress, Corporations, By Danny Schechter

From the author of The Crime Of Our Time

Financial journalist Charles Gasparino whose career trajectory took him from Newsweek to CNBC to Fox News was on with Bill O’ Reilly doing what the host of the factless Factor likes to do the most: promote Fox News.  In the course of their self-promotional banter, Gasparino let sip an unverifiable story about a meeting of top CEOs speculating about whether President Obama really is a secret Socialist.

Stories like this, invented or not, freak a White House ever eager to reassure the business world of their loyalties. That is no doubt why Robert Gibbs, the  President’s Press  Secretary took a whack at the “professional left,” a statement he later said had been “inartful” but did not withdraw.

Writing on OpEd News, Kevin Gosztola was not surprised:

“While circumstantial, the best evidence for why Gibbs would feel like uttering the aforementioned remarks is the shift of money from Wall Street to Republicans ahead of the election… The Democrats earned 57 percent of campaign contributions from securities and investment industries.

The situation compels the Obama Administration, especially White House press secretary Gibbs, to whip the left and the sections that are most listened to by voters into line not only because money from business interests needs to swing back the other way but because disappointed and disillusioned voters will likely stay home, not donate to Democratic Party campaigns, not make phone calls, and refuse to go door-to-door canvassing prior to Election Day if they do not fall in line.”

According to a preliminary analysis, the Center for Responsive Politics reports that “individuals and political action committees linked to the financial and real estate sectors swung hard to the Republicans with their giving since last year….
In March 2009, 70 percent of money from the sector went to the governing party, but by this summer, 68 percent was going to the opposition, as Democrats fought to pass some version of a financial overhaul.”
The motivation for Gibbs’ remarks may or may not be tied to signaling Wall Street but the deeper truth is that everyone, right and left alike, seem frustrated and at the same time powerless to check the continuing economic decline.

The private sector is not creating jobs. The GOP is blocking the government from doing more stimulus programs while the system seems to be unraveling. All the talk of cutting deficits by conservatives or ending tax cuts by liberals will not give the economy the boost it needs. There is a paralysis of analysis and a stalemate.

The markets were more freaked by the recent pessimism oozing from the Fed than any partisan punditry. The slowdown they are worried about has already doomed any heavily-hyped “recovery.”

And the public knows it, according to the recent polls.

What’s worse is the tea leaves offer few signs of a turnaround any time soon even if General Motors is selling more cars—many, may we be reminded,  in China. (The GM CEO who last week took a nasty ingrate smack at GM being perceived as “Government Motors,” demanding the government sell all of its shares, has just announced he is leaving!  I wonder why?)

The Carlysle Group is taking over while the automaker launches a new program of subprime lending, the very predatory dealmaking that got them in trouble in the first place.

Does anyone ever learn from history, or care about how communities are being destroyed as a financial crisis becomes a social crisis at the grass roots level?

Check out what happened at that mall in Atlanta where thousands of people nearly rioted to get on a public housing waiting list. The Congress returned from its recess to pass new monies to keep teachers teaching and cops patrolling. They did so by slashing food stamps so the unemployed and poor –some 41% of people who rely on them—will have to cut back further.

What a trade-off.

As for insuring the stability of an increasingly volatile system, will the new financial reforms make any difference?  It doesn’t look like it. The LA Times reported, “As Wall Street scrambles to find the best and most profitable way to operate under the new financial reform law, Goldman Sachs Group Inc. — the firm that was expected to suffer the most under the legislation — could emerge practically unscathed…

“…we think we are well positioned to be a market leader under the new rules,” said Jack McCabe, co-head of Goldman’s derivatives clearing service business.

Richard Bove, a bank analyst at Rochdale Securities, said he had changed his view of the law’s effect on Goldman.

“I thought this company was going to be really harmed by this bill; now I’ve figured out that it’s not going to happen,” he said. “They should win big here.”

That’s Goldman’s reason to celebrate its “big win” What about the others? The truth is we will not know for a awhile, for a long while, for many, many years. So much for any sense of urgency even after former Fed Head Paul Volcker said we are running out of time.

Bloomberg News explained why,

“Many of the measures ordered by Congress and global regulators, aimed at cushioning the financial system in future crises, are years away from being implemented. The Basel Committee on Banking Supervision plans to give the world’s banks until 2018 to comply with limits on how much they can borrow. Parts of the Volcker rule, a provision of the new Dodd-Frank Act that would force firms to cut stakes in in-house hedge funds and private-equity units, may not go into effect for a dozen years…

“Based on our experience of government’s ability to execute these things effectively and in a timely way, we are almost uncovered now from any future financial risk for at least another 8 or 10 years, and that’s a little scary,” said Roy Smith, finance professor at New York University’s Stern School of Business and a former banker at Goldman Sachs Group Inc

Economist Nouriel Roubini, one of the first to forecast our crisis, worries that major economies in Europe are at risk and could fall. At the same time I am reading articles that contend, “The US is more bankrupt than Greece.”  Another reports the IMF saying the US is bankrupt but most Americans don’t know it.
What else don’t we know?

At the same time, the folks who brought us this crisis are still riding high, making multi-million dollar “settlements’ to cover up fraudulent practices.  In recent weeks, Goldman Sachs, Countrywide and, now, Wells Fargo have just done that in part to avoid prosecutions.

Their CEOS are going on vacation to spend their ill-gotten gains, not to jail to pay for their crimes. And the “professional left”—whatever that is supposed to be—is more pissed at Robert Gibbs blathering at that podium than the banksters maneuvering behind the scenes.

Can anyone tell me what’s wrong with this picture?

Just one footnote: In this week of growing economic despair, an 81 year old senior citizen named Bernard Stone stood outside the unemployment office in Harlem with a flyer of his own making calling on President Obama to issue an executive order closing all American-owned factories outsourcing jobs. If they don’t do it, their executives should, he suggests, lose their citizenship and be deported  to the countries to which they exported American jobs.

“The hundred or so people who read my leaflet liked that part,” he told me.

News Dissector Danny Schechter directed the film “Plunder: The Crime of Out Time” to investigate the financial crisis as a crime story. (Plunderthecrimeofourtime.com) Comments to dissector@mediachannel.org

 
1 Comments
Leave A Response

Tax $ for Good, Bad, and Downright Rude Offices of Elected Officials

On June 21, 2010, In Congress, Current Leadership, The Public, By ruth

By Ruth Robertson, ANWF Organizer

A New Way Forward launched call-in days last week to do two things – push for structural reforms that address root causes of the crisis and dig out the backroom information that, when hidden in the dark, work all too well to kill good reforms. The call-in days are ongoing (report back here) through the last leg of passing HR 4173, the financial reform bill. Unfortunately, it seems many Congressional offices don’t understand that taxpayers make their jobs possible and deserve a cooperative environment, rather than one where getting hung up on, snapped at, and unanswered is common. Members of A New Way Forward took to their phones and called elected officials in the 202 area code en masse.


It has been great to see into the political process through Congressional offices — by getting staffers on the phone and connecting with them, the process of passing the financial reform bill has felt more transparent and responsive to the American public. That’s a good thing. Thus, it makes us wonder why any part of congress thinks that they can hang up on people, create an unfriendly environment for citizen calls, send them to a voice machine, just not answer the phone, misunderstand that conferees are working  on behalf of all voters through HR 4173, not just their constituents, when the calls start coming in. These staffers are a part of the political process and are paid for by taxpayer dollars. Because of the lack of the ability for there to be greater public participation in the political process, staffers over the years have not learned their role as servants of the public.

Over the phone lines, ANWF activists told politicians that we are keeping our eyes peeled for back room deals that could hinder critical financial reforms.  By asking key questions about their positions on three of the most important reforms, ANWF members made it clear that any tomfoolery leading to weakened reform initiatives is unacceptable; strong reform is essential to addressing the problem of bailouts and the economic crisis.

Last week, our targets were Sens. Dodd, Lincoln, Gregg, Johnson, Reed, Schumer, Corker and Reps. Frank and Kanjorski, among other conferees throughout the week. Because of a letter sent by New Democrats to kill strong bank reforms, on Thursday, we targeted some of the U.S. Congress members on the New Democrat caucus – Representatives Gary Peters (D-MI),  Gregory Meeks (D-NY), Luis Gutierrez (D-IL) and Dennis Moore (D-KS), Chairman of the Financial Services Subcommittee on Oversight & Investigations.

How did these and other elected officials respond to inquiries from concerned citizens?  The usual shenanigans: their staffers ducked our calls, gave evasive answers, refused to speak to callers outright, and even hung up on one of our callers!

The good news in all of this is that insiders tell us Representative Gutierrez’ office is backtracking now and saying they are NOT against Section 716 of the Senate bill, which calls for a ban on FDIC assistance to bank swaps. Instead, Rep. Gutierrez is working for a pre-fund that banks pay into before a crisis happens. We are happy to report that one of his staffers handled our inquiries in a polite and professional manner, compared to the rude treatment callers received from staffers in some other politicians’ offices.

Congratulations to Mr. Gutierrez’ staff for being the best of the bunch, which may not be saying much! Some of the other responses our dedicated and hard-working volunteers heard left us scratching our heads. Negligent staffer responses make elected politicians seem careless with taxpayer money.

REFUSED TO GIVE US THEIR NAME

A staffer identifying himself as Mason replied to one of our calls to Representative Moore, saying the Congressman hadn’t decided his position on any of the reforms, and asked if our caller is a constituent.  Another of Moore’s staffers told me that he is “just Jack“, and refused to give his last name!

CALL YOUR OWN OFFICE

Mason’s response was a pretty typical one to our phone calls, even when we explained that this issue goes beyond local representation. Taking the opportunity to educate some staffers, ANWF member Angela said, “the spectacle of Democrats capitulating to bankers is very shocking to rank and file voters and that this will affect the willingness of Democrats to volunteer, contribute and vote for Democrats in the fall, nationwide”. Great comeback, Angela!  We hate it when they they pull this constituent-only stuff–as if the bill will only affect their own constituents!

When I called Representative Peters’ office and introduced myself as an activist with A New Way Forward, the staffer on the other end of the line responded with anger. She said indignantly, “We have already received two calls from A New Way Forward!” I assured her that we are a grassroots organization of individual citizens very concerned about the economic health of our nation, but she insisted they should not have to answer more than once to the group. Wrong response.

Some of the responses our callers got in their attempts to reach elected leaders were odd. A staffer answering the phone at freshman Congresswoman Mary Jo Kilroy’s office said more than once that callers from outside of central Ohio should call their “personal office“. We don’t believe “personal offices” are appropriate when it comes to the whole financial reform bill.

ANSWERING MACHINES

ANWF callers reported that many staffers seemed to prefer “sending people to machines“, using voicemail technology to avoid responding altogether.

BE EVASIVE OR RUDE

Other aides sounded utterly bored or indifferent at best.  On multiple occasions, staffers pushed aside caller concerns, telling them that they could not answer as “the conference is still ongoing”.

A New Way Forward caller Peter reported that a staffer at the office of Senator Judd Gregg (R-NH) got quite defensive until Peter supported his position with extensive knowledge of this issue.  Peter felt that the senator’s office “may be feeling quite a bit of heat“.  Put their feet to the fire, that’s our credo, Peter!

DON’T ANSWER THE PHONES

Senator Charles Schumer’s (D-NY) office was “most pleasant“–when callers were able to get through, and receptive but most callers to his office found that they could not connect.  Helen and several others stayed on the line after being placed on hold by an automated voice message system, waiting for five or more minutes listening to the phone ring repeatedly only to get cut off to a buzz tone.

Lars said that is a “pretty unfortunate way to treat the public, whether by design or not: after 6 minutes of waiting on hold and hearing 2 different recorded messages from Schumer himself (which at least is an attempt to show interest in what callers have to say), I got several rings and then was disconnected.”

Hopefully, Senator Schumer will get that problem fixed soon. That’s not a good way to deal with citizens, Mr. Schumer!

HANG UP

And who’s office was it that hung up on a shocked ANWF member?  None other than the office of Senator Jack Reed (D-RI)!

A New Way Forward’s message to our elected officials: Your staff is your public face, and if you try to blow us off as a staffer at Mary Jo Kilroy’s office did in one case,  or politely thank us for our comments as a staffer of Representative Peters’ office did, , it all makes a difference.

If politicians are surprised about this kind of activism and they don’t think we take serious note of their public face, they should know that we will call them out on their shenanigans, whether they are happening in the back rooms of Congress or in their front offices.

 
4 Comments
Leave A Response

Call-in Days to Keep The Big 3 No Bailout Reforms

On June 10, 2010, In Background and Research, Congress, Corporations, Current Leadership, The Public, By Tiffiniy Cheng

OUR CALL-IN DAYS ARE OUR LAST HOPE FOR “NO BAILOUTS REFORMS”

LATEST UPDATES: Tell us how your call went in the report back section right here, or scroll down below. We have had so many calls and so many reports back, it’s really great to watch the staffers start to get it and know we’re around. This week, our targets are Sen. Johnson, Rep. Frank, Sen. Corker, and Sen. Reed. TPM reports on the four New Dems weakening measures behind closed-doors, can you call them and report back?: Rep. Luis Gutierrez (D-IL), (202) 225-8203; Rep. Gregory Meeks (D-NY), 202-225-3461; Rep. Mel Watt (D-NC), 202-225-1510; Rep. Dennis Moore, Chair (D-KS), (202)225-2865. Rep. Frank has tried to gut provisions to reform credit rating agencies, showing where he is going with the bill… The Senate agreed to expand auditing of the Fed – 1 BIG WIN SO FAR. Our #2 reform discussed now, seems like a win.. Thank you for making the calls! (Follow on @wayfwd, FaceBook, riski)

We’re going to make sure there are no backroom deals that effectively gut the best reforms currently in the bill — we’ve launched “Call-in Days for the Big 3 No Bailouts Reforms” to put every decision maker in the spotlight for gutting or keeping the Big 3. We have 14 days until June 24 to influence the financial reform bill to be something worth passing. So, yesterday on Tuesday, today on Wednesday (6/16), and tomorrow on Thursday (6/17), please help us get enough people so it’s like we’re walking right into the backroom with them and slapping their hands if they do something bad. We’ll update our list on the slimiest and worst on financial reform. Full list below.

Sign up for a day that works for you — you just need a 5 minute chunk of time free — and we’ll make your call effortless. If you’ve already signed up and when you finish your call, add what you find out in the report back section here. As soon as we hear back from you, we’ll update who is acting the sleaziest (you can also report back at #finreg #716 on twitter).

We need to call as much as each of us can to stop government support and incentives for banks to become bigger and riskier – this is structural reform.

WHAT’S HAPPENING IN THE LAST LEG OF FINANCIAL REFORM? The financial reform bill is going into the final stage in the legislative process this week and bought-out members of Congress are trying to stealthily remove all the provisions in it that the big banks oppose. The financial reform bill would be a pure product of lobbying and big banking if it were not for the just a handful of “No Bailout Reforms” that are still in the bill as we speak. Can you join us in making sure that conferees don’t gut the strongest provisions in the financial reform bill behind closed doors?

No-Bailout Reform #1, is Section 716, “PROHIBITION AGAINST FEDERAL GOVERNMENT BAILOUTS OF SWAPS ENTITIES”. Currently, the Senate financial reform bill still has language in it that will stop the biggest, most dangerous banks from getting federal bailouts for their riskiest gambling. The provision that provides for this would require banks to spin off the derivatives activities into separate entities without access to discount Fed money and FDIC guarantees. It is structural reform. This is the main provision that our conference committee members are being asked to gut by the lobbyists. 716 literally says this in its own bill text. Without this language financial companies that turned themselves into banks for the purpose of receiving bailouts under the TARP will get to stay bailout recipients in perpetuity. Without this language, the 2008 crisis will lead to a permanent situation where the government continually subsidizes derivatives trades, which were at the heart of what caused the crisis. Here’s more from Bankster.

No-Bailout Reform #2, STRONG CAPITAL REQUIREMENTS FOR BIG AND SMALL BANKS: When banks make their bets, they’re supposed to put some money down. Over the years, the largest banks received exemptions to how much, and therefore their bets got riskier. This time around, Senators Collins and Representative Speier have introduced complementary amendments in the Senate and House to make sure that the money these banks put down for their bets is real capital and is enough to keep the big banks from taking risks they can’t pay for and need to be bailed out by taxpayers. For strong capital requirements, the best of the House and Senate version need to stay. Here’s more from Rortybomb.

No-Bailout Reform #3, A NEW CONSUMER PROTECTION AGENCY: A signature reform of the Obama Administration and TARP watchdog Elizabeth Warren, an independent consumer watchdog agency can stop financial corporations from abusing consumers. “Subprime mortgages. Abusive and arbitrary rate hikes on your credit card. Payday loans. If you’re wondering who lets banks get away with this crap, there are more people at it than you think. There are no less than four federal regulators responsible for overseeing consumer protection in finance, and all of them are terrible,” writes Zach Carter. The Senate bill would house the CFPA in the Fed and allow the Fed to veto their rules proposal. That’s unacceptable. We need an independent CFPA, via the House bill, with full rule-making authority. More from HuffPo.

BIG REFORM #4: First and foremost, we’re advocates of breaking up the big banks. We fought for the Brown-Kaufman amendment to cap the size of banks before they get too big to fail, but it didn’t pass with the Senate bill. Therefore, we agree with Dr. Simon Johnson that Rep. Kanjorski’s amendment to allow regulators to break up the banks is an important part of the finreg bill and are happy to push for it. To see more reforms, see our blog post from Stephanie and Ruth.

Supporters of these measures are Nobel Laureate Economist Joseph Stiglitz and Paul Krugman, renowned Economists Robert Reich, Jane D’Arista, Dean Baker, Simon Johnson, Jennifer Taub, David Moss, Michael Greenberger, financial writers and advocates, Rortybomb/Mike Konczal, Ilan Moscovitz of the Motley Fool, Zach Carter of CAF/Alternet, Public Citizen, CAF, David Dayen/FireDogLake, BanksterUSA, McJoan of Daily Kos. Join them!

Latest movements for the strongest reforms: Simon Johnson, Rortybomb, FireDogLake. CNBC says banks will lose on 716. Fed Chiefs support 716. NYTimes editorial.

AND NOW, WHO IS WATERING DOWN THE BILL? We have figured out who is trying to water down the bill thanks to the many people who have told us what they have heard in the comments of this post and what has been said in public.

Who of the 28+ are running the sleaziest deals (today the top 4 are Frank, Reed, Johnson, and Corker)?:

Big Bank Defenders (they would love to hear from you):
* Rep. Luis Gutierrez (D, IL) (202) 225-8203 here, here
* Rep. Spencer Bachus (R, AL) 202-225-4921 report, report
* Sen. Jack Reed (R, RI) (202) 224-4642 here, CFPA
* Rep. Dennis Moore, Chair (D, KS) 202-225-2865 blue dog, here
* Rep. Mel Watt (D, NC) 202-225-1510 bank cash, pro-CFPA, here
* Rep. Gary Peters (D-MI), (202) 225-5802 here, here
* Sen. Saxby Chambliss (R-GA) 202 224 3521 here

* Rep. Scott Garrett (R, NJ) 202-225-4465 C-SPAN, this
* Sen. Mike Crapo (R-ID) 202-224-6142 here
* Rep. Judy Biggert (R, IL) 202-225-3515 bad
* Rep. Gregory Meeks (D, NY) (202) 225-3461 bad, here
* Rep. Jeb Hensarling (R, TX) 202-225-3484 bad
* Rep. Edward Royce (R, CA) 202-225-4111 here, here
* Sen. Judd Gregg (R-NH) 202 224 3324 report, article
* Sen. Richard Shelby (R-AL) 202 224 5744 here, here
* Sen. Bob Corker (R-TN) 202 224 3344 here

Public Defenders (so far):

* Rep. Paul Kanjorski (D, PA) (202) 225-6511 here
* Sen. Blanche Lincoln (D, AR) (202) 224-4843 gutting, reverting, report
* Rep. Collin Peterson (D-MN) 202-225-2165 prefers House version, maybe
* Sen. Tom Harkin (D, IA) (202) 224-3254 here
* Sen. Patrick Leahy (D, VT) (202) 224-4242 here
* Sen. Tim Johnson (D-S.D.) 202-224-5842 pro-CFPA
* Rep. Maxine Waters (D, CA) (202) 225-2201 here, here

MYSTERIOUS (they need calls ahora)

* Sen. Chris Dodd (D, CT) (202) 224-2823 report, and report, report
* Sen. Charles Schumer (D-NY) 202 224 6542 report, most fin cash, here
* Rep. Mary Jo Kilroy (D, OH) 202-225-2015 neutral
* Rep. Shelley Capito (R, WV) 202-225-2711 (against)
* Rep. Carolyn Maloney (D, NY) (202) 225-7944 unclear, here
* Rep. Barney Frank (D, MA) (202) 225-5931 no, yes, yes, here, YES

We hope that you are helping to call, join us for the next day or call right now, and further target the few people we need to reach. Then, help us finish the job — we can’t wait to hear from you so we can update our list of sleaziest deals — tell us what you hear in the comments of this post. Thanks for making it happen!

Tagged with: • • • • • • •
 
254 Comments
Leave A Response

The weeds, chaffe, and thrushing on financial reform

On June 10, 2010, In Background and Research, Congress, Current Leadership, By guest

written by Stephanie Remington and Ruth Robertson, great ANWF organizers in California.

Today is the day of our call-in days — please call — as they start to hear from us, they have to move. We’ve got a few days to get good reform – the details matter.  The banks are spending a fortune lobbying congress to keep things the way they are, but the rest of us (on the receiving end of their catastrophic risk-taking and blatant fraud) outnumber them.  We can’t lose sight of the public interest because we can get what we want by forcing their hand. Lincoln, Dodd, and Congress aren’t going to come back and say, “hey, you really changed our positions, activism really matters!”, but their omissions should are remiss.

Of course the problem with financial reform in the first place is that we’re tackling the entire system at once, including the small details. So many amendments are about very specific, obscure financial operations, which many people just don’t find that interesting. The details have hurt our fight for strong structural reform — everything is presented as and in one sense is complicated, some people just completely tune it out. Well, there are clear, overarching, very general, extremely structural solutions to the key issues leading to the financial crisis.

We only care about structural reforms that address key problems of financial crises:

Read the rest of this post here.

1.   First and foremost, Section 716 which addresses the problem of derivatives is the strongest and currently most possible reform we can push for. It’s gone through many cycles, and our readers have successfully fought through them. The good news is — it is still in the bill. It is the most contentious provision and it will define how strong the Democrats are on the big banks.

No other provision will accomplish what 716 does in terms of removing the subsidy enjoyed by a handful of institutions. Section 716 is the best chance for ending the ongoing threat to the taxpayer in the the current business of derivatives. At the heart of 716 is the structure it provides making a clear separation between the business of banking and that of marketing and trading derivatives. It provides a structure that protects the core financial functions of banks without extending those protections to cover highly risky derivatives transactions.
Section 716 will contribute to shrinking the size of individual institutions’ positions and the market itself by requiring that dealing and trading derivatives move to separately capitalized affiliates that do not have access to Fed lending facilities or FDIC guarantees. The huge capital reserves of institutions that dominate the U.S. market will no longer be available to support their outsized positions. The capital of derivatives affiliates, even if within the same holding company, will have to be much smaller, creating opportunities for non-bank firms to enter the market. Section 716 eliminates the risk the largest banks incur through marketing and trading OTC derivatives. It will help reduce the risk to the system as a whole by encouraging an expansion in the number of dealers in derivatives.
Blanche Lincoln (D-AR) is behind 716 and she won her Democratic primary on the strength of committing to tough new rules on Wall Street. Unfortunately, 716 suffered a couple of casualties that will be fatal to reform if left untreated. But, Sen. Maria Cantwell’s (D-WA) amendment (4086) addresses the loophole.

Lincoln wrote the whole of the derivatives section, including the “safe” proposals — she specified the means to end the biggest source of trouble with derivatives – that “the entire market operates in secret.”  She required “central clearing,” a means of shining light on and watching over trades. This provision was undercut by language added by Democrats (Section 739, paragraphs A and B).  This section would codify into law the now common practice of refusing to prosecute certain criminals for their demonstrably illegal activity. Section 739, paragraphs A and B, must be removed or voided by including Maria Cantwell’s amendment 4086 – it must be added for Lincoln’s section to work.

The Obama administration (notably, Treasury and Larry Summers), Senate Banking Chair Chris Dodd, and House Financial Services Chair Barney Frank propose a “substitute” (Merkley and Levin’s strengthened version of the Volcker rule). M-L must be in addition to, not instead of, Lincoln’s section.  There’s no overlap between them; neither can substitute for the other.  Mary Bottari of Bankster USA outlines five unique features of Lincoln’s section here.

2.  The Volcker Rule: Zach Carter, Fellow at Campaign for America’s Future, reports that “The best version of President Obama’s signature Wall Street reform was an amendment written by Sens. Jeff Merkley, D-Ore., and Carl Levin, D-Mich. It was never voted on in the Senate and the House bill contains no version of any ban on proprietary trading by commercial banks. The Senate bill does include a weak version of the Volcker Rule that bank-friendly regulators can easily defang if they choose.”  We need to push for inclusion of Merkley-Levin (SA 3931) in the conference and for negotiations that lead to a concrete ban on gambling with taxpayer money.

3. It is also important that we NOT forget about the Kanjorski amendment. While this amendment, introduced by Congressman Paul E. Kanjorski (D-PA), does not impose a hard size cap on banks, it proposes a number of potential objective criteria that could be used to determine when banks need to be broken up, including the “scope, scale, exposure, leverage, interconnectedness of financial activities, as well as size of the financial company.” It would greatly strengthen the hand of regulators and reinforce their power to break up those banks.  As the amendment is written, a great deal of discretion would remain with the regulators, so it is much weaker than what is really needed. However, the Kanjorski amendment serves as a public reminder that “bailouts are bad” and it also increases the likelihood that management and directors would be replaced in a failing large bank.

4.   An independent Consumer Financial Protection Agency: Dodd gutted an original version, but it can be restored.  In its current form it wouldn’t actually protect consumers because, among other problems, it would be housed within the Fed which has yet to use its substantial, already-existing authority to protect consumers. As such it is the staying tuned to tip their hand.
Here’s a great video clip of an interview with Elizabeth Warren, Chair of the Congressional Oversight Panel created to oversee TARP bailout funds. Zach Carter reports that currently, “the House version of this agency is generally stronger than the Senate version, with more independence and broader authority. But the House version also exempts auto dealers from CFPA oversight which the Senate version does not.”

5.   Capital and leverage: From Zach Carter: “Thanks to Sen. Susan Collins, R-Maine, the Senate bill contains the strongest language to toughen capital requirements at big banks, forcing them to have more money on hand to cushion against losses. There is no corresponding language in the House bill, but the House legislation does contain a related provision capping bank leverage–the amount of borrowed money banks can use to place bets in the capital markets casinos. How these good amendments fare in the
conference committee will significantly impact how the financial system functions over the next decade.”  More from Rortybomb.

6.   Fed Audit: Congressman Ron Paul has been called the key battler against central banking and against the Federal Reserve and is the author of the book, End the Fed. His supporters say he has worked tirelessly to bring accountability to what they call “the secretive bank”.   The Congressman, who says he has worked to bring transparency to the Federal Reserve Bank for the past 30 years, introduced a bill to audit the Federal Reserve, but that bill did not make it into the Senate version of the Financial Reform Bill.  Sen. David Vitter (R-LA) later reintroduced an amendment  with the original Audit the Fed language, but the Senate rejected that amendment on May 11, 2010 by a 37-62 vote.

7.   Rating agencies: From Zach Carter: “Sen. Al Franken pushed through an amendment that substantively changes the corrupt business model at rating agencies. Right now, rating agencies do not get paid by the investors who use their ratings, but by the very banks who are issuing those securities. Franken would end this system, having regulators select which rating agencies rate which securities, rather than the banks who issue the securities. The House bill largely leaves the rating agency business model unchanged.”

8.   Swipe fees: From Zach Carter: “When you buy something at a store with a credit or debit card, Visa and Mastercard charge the store a fee. The store, in turn, charges you more for its products, making everything everybody buys more expensive. Sen. Dick Durbin, D-Ill., pushed through language cracking down on debit card fees, but there is no language addressing swipe fees of any kind in the House.”

9. Too big to fail: Sherrod Brown and Ted Kaufman introduced an outstanding bill that would have ended TBTF.  It did not pass the Senate, but is crucial to success of financial reform.

Some of the main obstacles to achieving true reform are people in the Obama Administration, as well as bankers spending big money on Congress members to get their support.  Along with our demands for specific language in the bill, we need to be pushing for the removal of Summers and Geithner and the appointment of a new Fed Chairman, which would effectively – and necessarily – get rid of Bernanke.  These people, among a larger group of insiders and captive regulators, must be replaced with people with successful track records, who believe in true reform, and who will push for it instead of blocking it at every turn.

We have, in Joseph Stiglitz, Robert Reich, and Simon Johnson, three people whose expertise and commitment to reform make them ideal candidates to replace Summers and Geithner and move our nation toward a healthy economy–an economy that will never again be at the mercy of the big banks. For a new Fed Chairman Joseph Stiglitz, for Secretary of the Treasury Robert Reich, and for Obama’s Economic Advisor, Simon Johnson would make a true Dream Team.

Tagged with: • • • • • • • •
 
2 Comments
Leave A Response

Whip the Senate on SAFE Banking

On May 5, 2010, In Background and Research, Congress, Corporations, Current Leadership, The Public, By Tiffiniy Cheng

The Brown-Kaufman SAFE Banking amendment (S.3241) has become the single most important amendment to the financial reform bill to end bailouts. It is the most transformative bill because it addresses the problem that too big to fail banks are too big to regulate properly and are able to capture votes in Congress like nobody’s business. (UPDATE: Our data crunching shows that Senators who are currently opposed to breaking up the banks receive twice as much in campaign contributions from the finance sector than those who are for “SAFE Banking.”)

It is going to be voted on by the Senate soon, possibly by the end of this week. We’re making tons of progress — MoveOn is on board, New York Times is supporting it, the Senate’s #2 Democrat, Dick Durbin, is supportive — and we have a real chance here to limit the size of the biggest banks so they don’t distort our politics and put out economy at risk any longer.

But here’s the problem. We don’t know where to focus our our calls to Congress to secure the last few votes we need to get the amendment passed. We’re totally outgunned here by the moneyed special interests that oppose fixing too big to fail, but we have the momentum and we are closer than ever to pulling it off.

Here’s what we need to do.

  1. Go to this link and enter your zip code to get the phone numbers for your two senators.
  2. Make a quick call to each asking if they support the Brown-Kaufman SAFE Banking Act. Tell them they should.
  3. If they don’t give you a straight answer, do a quick Google search (for example: “too big to fail” John Kerry) and see if you can find any public statements indicating where they stand on the issue.
  4. Record your findings in the comments section of this blog post and we’ll update a running tally of what we know about where each senators stands.

We need at least one person from each state to do this. This is the single most important thing you can do right now to help the effort to break up the big banks. If you know anyone in another state who supports breaking up the banks please email this blog post to them so they can help out too. Thank You!! (UPDATE: We helped deliver 50,000 of the petitions for breaking up the banks featured in this picture and article and now Reid is a leaning yes!)

Supportive

Ted Kaufamn [D, DE]
Sherrod Brown [D, OH]
Bob Casey [D, PA] and this
Tom Harkin [D, IA]
Jeff Merkley [D, OR]
Bernie Sanders [I, VT]
Sheldon Whitehouse [D, RI]
Dick Durbin [D, IL]
Roland Burris [D, IL]
Byron Dorgan [D, ND]
Al Franken [D, MN]
Russ Feingold [D, WI] and this
Harry Reid [D, NV]
Jim Webb [D, VA]
Mark Pryor [D, AR]
Chuck Schumer [D, NY]
John Kerry [D, MA]

Lean “Yes”

Pat Leahy [D, VT]
Patty Murray [D, WA] (and this) and this
Ben Cardin [D, MD]
Jim Bunning [R, KY]
Ron Wyden [D, OR]
Debbie Stabenow [D, MI] and this
Robert Byrd [D, WV]
Barbara Mikulski [D, MD] and this and this
Robert Menendez [D, NJ] and this
Tom Coburn [R, OK]
Maria Cantwell [D, WA] and this and this

Undecided

John Kerry [D, MA] and this
Scott Brown [R, MA]
Jack Reed [D, RI]
Barbara Boxer [D, CA] and this
Dianne Feinstein [D, CA] and this
Lindsey Graham [R, SC]
John Cornyn [R, TX] (also this) and this
Jack Reed [D, RI]
Richard Chambliss [R, GA]
Tom Udall [D, NM]
Jeff Bingaman [D, NM]
Carl Levin [D, MI] and this
Frank Lautenberg [D, NJ]
Johnny Isakson [R, GA]
Daniel Akaka [D, HI] and this
Daniel Inouye [D, HI] and this
Jon Tester [D, MT]
Max Baucus [D, MT]
Patty Murray [D, WA]
Benjamin Cardin [D, MD]
Joseph Lieberman [I, CT]
Chris Dodd [D, CT]
George Voinovich [R, OH]
Roger Wicker [R, MS]
Kay Hutchison [R, TX]
Susan Collins [R, ME]
Olympia Snowe [R, ME]
Herbert Kohl [D, WI]
Kirsten Gillibrand [D, NY]
Blanche Lincoln [D, AR]

Opposed

Kent Conrad [D, ND]
Bill Nelson [D, FL]
Mark Begich [D, AK]
Mark Warner [D, VA]
Judd Gregg [R, NH]
Chuck Grassley [R, IA]
Mike Enzi [R, WY]
Jeff Sessions [R, AL]
Mike Crapo [R, ID]
John Ensign [R, NV]
Lamar Alexander [R, TN]
Thad Cochran [R, MS]

 
92 Comments
Leave A Response

Auditing the Fed – Democratize Power

On May 4, 2010, In Background and Research, Congress, Corporations, Current Leadership, free markets, The Public, By Tiffiniy Cheng

Why can’t we have accountability to the public, especially when we’re talking 2 trillion dollars outstanding from the Federal Reserve? Auditing the Fed should be about stopping big power tricks. But, why? Yesterday, Fed Chairman Ben Bernanke said that the Fed created $1.3 trillion out of thin air — he did.

Here’s something I’ve been itching to write about and it requires more time and space, but why should the Fed be democratized, de-powered in its current state, and more accountable to the public? Why should we expect that the $1.3 trillion thin paper be ensured for the public’s interest rather than the big banks? Well, that’s part of the answer there – no government should be favoring one set of elites over the equal treatment of all parts of the industry (the small banks and medium-banks), even if the elites create many jobs because the non-elites can create those jobs too and actually do, but the basic principle is strong — everyone needs a chance to be able to create jobs.

We as country believe in equal treatment and equal opportunity — we should not have erected an institution that picks winners and losers, instead the Fed should have been erected as it originally was intended by the farmers in the 1890′s, in the interest of creating an institution that would create equal opportunity in the marketplace to replace the big banks holding all the gold then.  Instead, in 1913 the big banks erected the populist’s idea but for their own sake, this is now what we call the Fed. Equal opportunity is supposed to be what a free market is intended to create, but it doesn’t when the Fed is picking winners and losers and when big is favored over small and especially when big begets bigger and the Fed picks them even more and sets up a discount window for them too and there is a legislated bailout plan for them when they fail.

USAWatchdog reports, “Fed Chairman Ben Bernanke admitted the central bank created $1.3 trillion out of thin air to buy mortgage backed securities.  This shocking admission came from the Joint Economic Committee hearing on Capital Hill last week.”‘ You can help audit the Fed here.

So, why shouldn’t an institution that has the power of government behind it be democratized, and if not de-powered. Dean’s great on this, too, but on a purer note about independence, etc.

So, as there is a push for auditing the Fed, what is the real goal that we want from the audit? Why are we asking you to support no new powers for the Fed here? Why are we following Dean Baker on democratizing the Fed? Is it just so that the Fed can’t inflate away debt? I think there is an end-goal that anyone who cares about uhh.. about your own mother and father and your friends and people on the street around you over a few can agree on. The issue is not debt or money in actuality. Money is interesting but focus on it doesn’t get at the root of the issue, it’s power plays.

It’s about power because power gets all the money and then is able to manipulate the way whatever system works. So, to state explicitly, I don’t believe that those with the most money have the right to determine the way our politics or society works. I don’t, society woudn’t work and many know that society is not working — 300,000 + in foreclosure every month. But big powers will game any system, and have gamed gold, so make it so the system isn’t prone to being gamed.

Money is complicated. There are activist campaigns for a new Monetary Act. Money is complicated.  I can see it going somewhere.

All of money essentially comes out of thin air and evaporates that way too, or rather money is complicated.
To reform money you can’t think about money per se, but about the power to create money and to inflate/deflate it.
So, if we make the Fed elected regionally or democratically elected, accountable to the public’s interest, and if transparency can lead to that accountability, we will have a Fed that is subject to political pressure and must show us that they are not picking winners and losers themselves.
Different groups throughout time rail against this monetary system and that one — we must instead end the big bankers’ piggy bank of whatever form is has taken and is in now, especially those funded by taxpayers. The system we have is irrelevant, rather we must set up the system to be democratic. Yes?
We can make auditing the Fed an accountability measure, one step closer to making whatever system of money we have democratically accountable. We must accept that people will start moving to the top in any system, then those on top are going to game whatever it is we have. Thus, we need to make the system that we have resistant to being gamed.
I think economist, Nassim Taleb may well agree — he’s a top-notch dude, as far as I can tell.
 
0 Comments
Leave A Response

Letter in Support of Kaptur’s Great Efforts

On April 11, 2010, In Congress, By Tiffiniy Cheng

This letter is being sent to Marcy Kaptur, feel free to send it:

The Honorable Marcy Kaptur

United States House of Representatives

Washington, DC 20515

March 31, 2010

Dear Representative Kaptur:

We are writing in support of H.R. 3995, the “Financial Crisis of 2008 Criminal Investigation and Prosecution Act of 2009,” authored by Representative Marcy Kaptur.

In the eighteen months since fraudulent and corrupt business practices in the mortgage area and on Wall Street collapsed the economy – costing taxpayers trillions in lost wealth and savings – it is difficult to point to any successful prosecutions of major players in this debacle. Compare this to what happened after the Savings and Loan (S&L) crisis of 20 years ago. According to Department of Justice (DOJ) statistics, no less than 1,852 S&L officials were prosecuted and 1,072 were jailed. Over 500 of these were top officers.[1]

Why the difference? In the wake of the S&L crisis, Congress pushed regulators to investigate and prosecute. Congress also provided significant new resources to this end. A series of strike forces based in 27 cities was staffed with 1,000 FBI agents and forensic experts and dozens of federal prosecutors.[2] Given the size and sophistication of the institutions now involved, even more resources will be needed to give prosecutors a fighting chance.

The “Financial Crisis of 2008 Criminal Investigation and Prosecution Act of 2009” authorizes the Director of the FBI to hire 1,000 more agents and additional forensic experts. The bill also authorizes the DOJ and the Securities and Exchange Commission to hire additional investigators and prosecutors to step up the pace of criminal and civil prosecutions.

Without these additional resources, it is highly unlikely that sufficient criminal prosecutions will be undertaken to deter the next corporate crime wave. Worse, the American people who have lost so much during this crisis will be bereft of the justice they deserve.

We urge your support of this important measure.

Sincerely,

Your name here

 
0 Comments
Leave A Response
« Previous Entries

Facebook 

 

ANWF Actions and People 

PICT0048
View more photos >
 
no content

LEARN MORE: Our Money and Economy 

BOOKS

1)Barry Lynn’s “Cornered: The New Monopoly Capitalism and the Economics of Destruction, the most important book on the hidden monopolies in our country and how they impact our democracy.

2)Neil Barofsky’s “Bailout: How Washington Abandoned Main Street While Rescuing Wall Street, the story of the mishandling of the $700 billion TARP bailout fund.

3)Lawrence Goodwyn’s “The Populist Moment: A Short History of the Agrarian Revolt in America,” one of the truly great works of American history and how to build a foundation for 20th century American political economy.

MELTDOWN CAUSES: Articles and Interviews

1. Finger of blame points to shadow banking’s implosion -Financial Times
2. Musings on Structural Challenges to the Financial System -Yves Smith
3. Hedge fund Manager Goodbye -Andrew Lahde
4. The End -Michael Lewis
5. Alan Greenspan and the Fed -William Greider
6. Bill Moyers and Kevin Phillips -video
7. Destructive Rise of Big Finance -Kevin Phillips
8. The Quiet Coup -Simon Johnson

"FINANCIAL INNOVATIONS"

1. Genesis of the Debt Disaster -Financial Times
2. Reforming Credit Default Swaps -Institutional Risk Analyst
3. AIG Bailout -Yves Smith
4. Mark to Model -Yves Smith

WHAT TO DO ABOUT THE BIG BANKS THAT FAIL?

1. Willem Buiter -FT
2. Thomas Hoening -Kansas City Federal Reserve
3. Joseph Stiglitz -Nobel Laureate
4. Nassim Taleb -FT
5. Dan Tarullo -Federal Reserve

ANTITRUST

1. Breaking up the Banks -Zephyr Teachout
2. Too Big to Fail is Too Big -Willem Buiter
3. Vigourous Antitrust -Christine Varney, Asst Atty General of DOJ, AT

REGULATION

1. Regulatory Capture -Thomas Frank
2. Making Regulation Work -Zephyr Taachout, Shawn Bayern

WHAT'S IT MEAN FOR THE ECONOMY?

1. Evolution or Revolution -Bill Gross
2. The Future of the American Dream -William Greider
3. Tom Geoghegan and William Greider on the Economy - audio
4. Andrew Bacevich Interview With Bill Moyers - video

 

 

 

Recommended Books — Donate by Making Your Purchases Here 
 
Go To Top »