Rein in Wall Street

Bernie Sanders

WALL STREET is still out of control. Seven years ago, the Federal Reserve and the Treasury Department bailed out the largest financial institutions in this country because they were considered too big to fail. But almost every one is bigger today than it was before the bailout. If any were to fail again, taxpayers could be on the hook for another bailout, perhaps a larger one this time.

To rein in Wall Street, we should begin by reforming the Federal Reserve, which oversees financial institutions and which uses monetary policy to maintain price stability and full employment. Unfortunately, an institution that was created to serve all Americans has been hijacked by the very bankers it regulates.

How Wall Street Skims Higher Education

To join the Drop Student Debt campaign go here. http://www.dsausa.org/drop_student_debt

Diane Ravitch Talks School Reform, the Chicago Strike, and the

Diane Ravitch Talks School Reform, the Chicago Strike, and the
http://prospect.org/article/diane-ravitch-talks-school-reform-chicago-strike-and-testing-vampire

Diane Ravitch.

Do you think there is a crisis in American education?

No. I think the crisis in American education is that there is a concerted effort to destroy it. That is a crisis—that’s a genuine crisis. Is there a crisis of academic achievement? No.

First of all, the test scores are the highest they’ve ever been in history on the National Assessment of Educational Progress, which is a no-stakes test. The scores of white kids, black kids, Hispanic kids, and Asian kids are the highest ever in history. What you hear from Bill Gates and [former chancellor of Washington, D.C., public schools] Michelle Rhee and all the others is we’re in a period of decline, all the schools are obsolete, the test scores are flat. Nonsense. They have been going up steadily for 40 years and they are the highest they’ve been in history.

Number two, the graduation rates today are the highest in history. Number three, the dropout rates are the lowest in history.

Is there a crisis in American education? Yes: We have all these Wall Street-funded foundation people running around saying we have to get rid of public education and saying all these phony things about our schools.

It wasn't Wall Street Bankers - it was the Teachers' unions.

The looting of the U.S. and the economic crisis were not caused by Wall Street and the corporations,  it was the Teachers’ Union.

Chris Christie.

At the Republican convention.

"Now having squandered trillions on mismanaged wars, tax cuts designed especially for the rich, a gigantic real estate bubble, and massive bailouts for its banks, the United States is confronting a major fiscal problems.  At the same time, America’s fundamental economic competitiveness has declined severely, as its physical infrastructure, broad band services, educational system, workface skills, health care and energy policies have failed to keep pace with the needs of the advanced economy. ….

The principal reason for this is that politically powerful interest groups have been able to block reform: the financial services, energy, defense, telecommunications, pharmaceutical, and processed food industries, the legal, accounting, and medical professions; and to a lesser extent, several unions- these and other groups , including, of course, lobbyists and politicians, have ferociously resisted efforts to improve  America’s future at their expense.

            Meanwhile, both political parties are ignoring, lying about, and/or exploiting the country’s very real economic, social, and educational problems."

Charles H. Ferguson,   Predator Nation; Corporate Criminals, political corruption, and the Hijacking of America.  2012.

Think Tanks and education. Part 2.

How do interest groups and “think tanks” operate ? Part 2.

“ Interest groups supported by the Kochs spew out a steady stream of position papers, congressional testimony , and public pronouncements about public policies that are detrimental to the middle class.  They back unrestricted free trade and oppose even the slightest government action that might be interpreted as protectionist, a position that helped to destroy millions of domestic manufacturing jobs. “

Bartlett and Steele. The Betrayal of the Middle Class. 2012.

And, in public education ?

Good for Business; Kids Not So Much

While most education reform advocates cloak their goals in the rhetoric of "putting children first," the conceit was less evident at a conference in Scottsdale, Arizona, earlier this year.

Standing at the lectern of Arizona State University's SkySong conference center in April, investment banker Michael Moe exuded confidence as he kicked off his second annual confab of education startup companies and venture capitalists. A press packet cited reports that rapid changes in education could unlock "immense potential for entrepreneurs." "This education issue," Moe declared, "there's not a bigger problem or bigger opportunity in my estimation."

Moe has worked for almost fifteen years at converting the K-12 education system into a cash cow for Wall Street. A veteran of Lehman Brothers and Merrill Lynch, he now leads an investment group that specializes in raising money for businesses looking to tap into more than $1 trillion in taxpayer money spent annually on primary education. His consortium of wealth management and consulting firms, called Global Silicon Valley Partners, helped K12 Inc. go public and has advised a number of other education companies in finding capital.

The economic crisis continues

   As the video above illustrates, we continue to have an economic crisis in the nation.  While Wall Street has recovered and returned to profitability, working people continue to suffer  15 million unemployed with at least 10 million more under employed.   It is more than a crisis - the reality is that the financial class has looted the U.S. economy.  They took 13 trillion dollars  out of the economy and caused 4 million people to lose their homes and  another 4.5 million to fall into foreclosure.    Millions have lost their unemployment benefits and their health care. See the story below from Bloomberg news of how the banks borrowed 7.7 $ Trillion dollars .

            We should have recovered from the economic collapse by now, but Republicans block all efforts to stimulate the economy.  It is simply not true, not accurate, that we are broke.  California remains the richest state in the richest nation in the world.   We have a crisis because the richest 0.1 % are making enormous profits and they are not paying a fair share of taxes.  Many of the largest corporations and the richest people pay no taxes at all.  They are not paying taxes for schools, police, roads, bridges, fire protection and basic services. Responding to a recession by budget cuts is self defeating.  All you have to do is to look at Ireland, Greece, and Great Britain to see what follows. It is a cycle down.   We learned this during the Great Depression – its called Keynesianism.

            We should be investing in re building our crumbling infrastructure  and putting teachers, cops, and childrens protective workers back to work.

Trumka, labor unions, support Wall Street protests

Declaring that “Wall Street’s out of control,” AFL-CIO President Richard Trumka has embraced street protests such as the Occupy Wall Street demonstrations—and others like them that are planned for cities across the country. As reported by John Nichols in the Nation.
Asked about the ongoing mass protest in New York’s financial district, which has begun to gain support from major unions, Trumka said Friday morning: “I think it’s a tactic and a valid tactic to call attention to a problem. Wall Street is out of control. We have three imbalances in this country—the imbalance between imports and exports, the imbalance between employer power and working power, and the imbalance between the real economy and the financial economy. We need to bring back balance to the financial economy, and calling attention to it and peacefully protesting is a very legitimate way of doing it.”
Hailing the power of street protests to shift the dialogue, Trumka said, “I think being in the streets and calling attention to issues is sometimes the only recourse you have because, God only knows, you can go to the Hill, and you can talk to a lot of people and see nothing ever happen…”

Bernie Sanders - On Wall Street protests

"Anyone with eyes open knows that the gangsterism of

Wall Street -- financial institutions generally -- has

caused severe damage to the people of the United States

(and the world). And should also know that it has been

doing so increasingly for over 30 years, as their power

in the economy has radically increased, and with it

their political power. That has set in motion a vicious

cycle that has concentrated immense wealth, and with it

political power, in a tiny sector of the population, a

fraction of 1%, while the rest increasingly become what

is sometimes called "a precariat" -- seeking to survive

in a precarious existence. They also carry out these

ugly activities with almost complete impunity -- not

only too big to fail, but also "too big to jail."

Noam Chomsky

Lawrence O'Donnell on Police Brutality at Occupy Wall Street

Join the Nurses' Rally on Wall Street

Nurses protested Sept.1. and Sept. 17 in San Francisco.

National Nurses United Convention Calls for Stepped Up Push For Wall Street Transaction Tax to Fund | National Nurses United

National Nurses United Convention Calls for Stepped Up Push For Wall Street Transaction Tax to Fund | National Nurses United

Tell Wall Street Bankers - No

Treasury Secretary Tim Geithner is pushing a settlement with the big banks and Wall Street firms that caused the mortgage crisis—letting them get away with a slap on the wrist.¹

Wall Street bankers have not faced any serious punishment for the widespread fraud that crashed our whole economy—pushing bad loans, lying to investors, forging foreclosure documents—and banks are making profits again while homeowners continue to suffer.²

Unbelievably, Geithner wants state attorneys general to agree to a sweetheart deal where these banks would pay only $20 billion—a fraction of what they could owe if fully prosecuted—and would get immunity from investigation and prosecution of the criminal greed, negligence, and fraud that caused this crisis. This would eliminate any leverage regulators have to pressure banks to help out the homeowners they've hurt.³

This settlement is only possible because it's flying under the radar. So we're joining with Rebuild the Dream to send a strong message. If we can shame Geithner and the Obama administration with a massive public petition, we can stop Wall Street from getting a get-out-of-jail-free card. 

Tell Treasury Secretary Geithner, "No more sweetheart deals for Wall Street. Let states investigate and prosecute the crimes that crashed our economy."

Nurses demand -Tax Wall Street

Some 80 Nurses and their union supporters boldly marched into the offices of Congressman Dan Lungren ( R. Sacramento) asking that he sign a pledge to support a Wall Street Transaction Tax on Sept.1, at his Gold River, California offices.  Speakers from California Nurses Association, from Retired RNs, and from the Sacramento Central Labor council asserted that they were united by the harm being done to our society by the Great Recession, and demanded a response from the Congressman who was not in his office and could not be located.

On Sept 1, 10,000 nurses and community participants  joined   actions in 21 states Thursday demanding action on the economic crisis to heal America. They called  on senators and Congress members in their local district offices  around the nation on Thursday  to pledge to “support a Wall Street transaction tax that will raise sufficient revenue to make Wall Street pay for the devastation it has caused on Main Street.” National Nurses United, the largest U.S. union of nurses,  sponsored  the actions.  Unions, labor councils, DSA, Jobs with Justice and other groups joined in solidarity with the nurses union.

American families are hurting, and they need jobs, healthcare, housing, quality education, nutrition, and a secure retirement.
 
 
The RNs and their allies called on Congress members to sign a pledge to “support a Wall Street transaction tax that will raise sufficient revenue to make Wall Street pay for the devastation it has caused on Main Street.” The visits follow a letter sent by certified mail to all 535 members of the House and Senate last week asking them to back the pledge and help “make the promise of the American dream… a reality.”

Cornel West on Barack Obama and Wall Street

Wall Street wins again- Surprise!

Wall Street Wins Again

Posted on Nov 8, 2010 By Nomi Prins

The Republicans may have stormed the House, but it was Wall Street and the Fed that won the election. Regardless of party power plays and posturing, there are two constants that remain unaltered after the election. First, Wall Street will continue on with business as usual while shifting its campaign and lobbying dollars to the new winning team. And second, the Fed will keep on pretending to prop up the economy by buying more U.S. debt, thereby keeping interest rates low, the dollar weak and money cheap for the banking system to inhale. This fictional boosting of the financial economy, absent the real boosting of the general economy, will march on sans debate, inspection or restriction.
In the wake of the election, the Fed pulled off a move detected only by downtown Manhattan. It quietly announced a purchase of $600 billion in Treasury securities (read: our debt) while pundits on the left and right were dissecting the role of the tea party in political life as we know it, the Obama dissatisfaction quotient, and the chance of Sarah Palin heading for the White House in 2012.

Finance Reform bill passes - finally

Democrats successes so far.

2009
January 29: Lilly Ledbetter Fair Pay Act


February 4: Children’s Health Insurance Reauthorization Act


February 11: DTV Delay Act


February 17: American Recovery and Reinvestment Act;

         Allocation of some $8 billion to California schools allowing districts

         to preserve some 16,000 teacher jobs and 15,000 jobs in higher ed.


March 30: Omnibus Public Lands Management Act of 2009


April 21: Edward M. Kennedy Serve America Act


2010. Plus. 3 allocations of addition funds for Supplemental Unemployment insurance to the states.  Currently Unemployment Insurance can extend up to 99 weeks.  Appropriations to extend the supplemental unemployment are currently blocked by a Republican filibuster in the Senate.

July 17,2010.  Financial regulation bill passed. ( Wall Street Reform).

This is as important as the Health Care reform bill. 

California budget cuts must stop !

As reported in each of the major papers, the Governor’s office is preparing a proposal to “balance” the state budget.  It increases the pain and suffering of the poor, the ill, and the unorganized. Even Schwarzenegger recognizes that these will be terrible, painful, cuts.

The major problem is not the  coming legislative conflicts, it is the deep, agonizing, unpopular cuts being imposed, including  lay offs of sheriffs, teachers, health care workers, child protective services, and the loss of the services which they provided.  Neither the government, nor the legislature  caused these cuts, they were created by the grand theft on Wall Street. The current  economic crisis has forced the cutting of higher education, of k-12 education, and of social welfare systems.

What caused this crisis ? It was caused by the greed and avarice of the financial class and aided by the politicians of both major political parties.

Major banks and corporations looted the economy creating an international meltdown.  Now, they have been rewarded with bail out money.  The crisis was not caused by students, teachers, public employees  nor recipients of social security.   The major bankers, finance capitalists in the U.S. robbed the bank last year  – and the federal treasury.  They took hundreds of billions of dollars – and you and I are being forced to pay for this theft with cuts in jobs and services.

 Over 40 states have severe budget problems caused by the Great Recession and there will be more next year.  In Oklahoma, Nevada, and Arizona, the cuts are more draconian than in California- and these are low benefit states.

The solution ? Make Wall Street Pay. They caused this crisis.  All sale of stocks and derivatives should be taxed 2%.  That would pay for the services we need, and limit  the Casino Capitalism of the rich and well connected.

Assembly hopeful Roger Dickinson urges county to sue Wall Street

The BEE had an article on May 6, 2010 about a press conference held by Roger Dickinson for Assembly.  This is a response to the article.

The point of view of this article is strange.  Wall street caused the current economic crisis. For evidence see 13 Bankers: The Wall Street Takeover and the Next Financial Meltdown, by Johnson and Kwak.   Or, you can watch the current Economic Crisis Investigation on CSPAN co- Chaired by  Phil Angelides.  This crisis almost brought the world economy to its knees.  Locally, the crisis produced unemployment, a severe reduction  in tax receipts, cuts in Sheriff patrols, closing health clinics, clinics for the mentally disabled, Child Protective Services, and others. 

 Dickinson criticized the Wall Street role in the crisis.   You bring out spokespersons for the rating agencies – that is spokespersons for Wall Street, to claim that Dickenson’s threat to sue might hurt Sacramento’s credit rating.  Excuse me!

Sacramento is borrowing $134 million and paying interest on it because of the economic crisis.  Now  the debt officer claims that criticizing Casino Capitalism on Wall Street is the problem!  No, the problem is the economic crisis.  And, the pain will last for several years. 

No one disputes that Sacramento  county's revenues are drastically down. There has been a  nearly 30 percent drop in sales tax for Sacramento County over the past five years. Property tax funds an even larger share of county budgets, and plummeting real estate values have meant even less income for counties to pay their bills.

During the current fiscal year, Sacramento's assessed property values dropped by 6.4 percent, and the outlook is for a continued decline into next year. And, the  ongoing budget-crisis impacts from the state also caused by the financial recession, which cut funding for counties, yet still requires them to provide costly programs. The reality is that almost all of California's counties are facing significant budget shortfalls resulting in cuts in programs, services and staffing. 

We need to look for ways to Make Wall Street Pay .  One possibility is to charge a 2% tax on all sales of derivatives and CDO’s.  I pay almost 8% sales tax when I buy anything in the county.  That pays for police, fire, utilities, and services.  But, when the Wall Street Casino sells billions in mortgage backed derivatives, they pay less than 1% tax.  If they would have to pay a tax on their sales, it would slow down the casino.  And, it would provide funds for the police protection, health clinics, Child Protective Services, and the many services which we are losing.

Make Wall Street Pay

The U.S. has failed to control Wall Street

For all Obama's talk of overhaul, the US has failed to wind in Wall Street

With a blank cheque from taxpayers and no real reform the perverse incentives for risk-taking are bigger than ever

by Joseph Stiglitz
The Guardian (U.K.)
9/14/09

What went wrong? Have the right lessons been learned? Could it happen again? The anniversary of the Lehman Brothers' bankruptcy and the freezing of the credit markets that followed is an occasion for reflection. I fear that our collective response has been mistaken and inadequate – that we may just have made matters worse.

The financial sector would like us to believe that if only the Federal Reserve and the Treasury had leapt to the rescue of Lehmans all would have been fine. Sheer nonsense. Lehmans was not a cause but a consequence: a consequence of flawed lending practices, and of inadequate oversight by regulators.

Financial markets had lent on the basis of a bubble – a bubble in large part of their making. They had incentive structures that encouraged excessive risk-taking and shortsighted behaviour. And that was no accident. It was the fruit of vigorous lobbying, which strived equally hard to prevent regulation of changes in the financial structure, new products like credit default swaps – which, while supposedly designed to manage risk, actually created it – and ingenious devices to exploit poor and uninformed borrowers and investors. The sector may not have made good economic investments, but its political investments paid off handsomely.

Lehmans was allowed to fail, we were told at the time, because its failure did not pose systemic risk. The systemic consequences its failure entailed, of course, were used as an excuse for the massive bailouts for the banks. Thus the Lehmans example became at best a scare tactic; at worst it became an excuse, a tool, to extract as much as possible for the banks and the bankers that brought the world to the brink of economic ruin.

Had more thought gone into how to deal with Lehmans, the Treasury and Fed might have realised that it played an important role in the shadow banking system, and that it was important to protect the integrity of the shadow system which had come to play such an important role in the US and global financial payments system. But many of Lehmans' activities had no systemic importance. The administration could have found a path between the false dichotomy of abandonment or bailout. That would have protected the payments system, providing the minimum amount of taxpayer money. Shareholders and long-term bondholders would have been wiped out before any public money had to be put in.

Bailing out the US banks need not have meant bailing out the bankers, their shareholders, and bondholders. We could have kept the banks as ongoing institutions, even if we had played by the ordinary rules of capitalism which say that when a firm can't meet its obligations to creditors, the shareholders lose everything.

Unquestionably we should not have allowed banks to become so big and so intertwined that their failure would cause a crisis. But the Obama administration has created a new concept: institutions too big to be resolved, too big for capital markets to provide the necessary discipline. The perverse incentives for excessive risk-taking at taxpayers' expense are even worse with the too-big-to-be-resolved banks than they are at the too-big-to-fail institutions. We have signed a blank cheque on the public purse. We have not circumscribed their gambling – indeed, they have access to funds from the Fed at close to zero interest rates, and it appears that "trading profits" have (besides "accounting" changes) become the major source of returns.

Last night Barack Obama defended his administration's response to the financial crisis, but the reality is that a year on from Lehmans' collapse, it has failed to take adequate steps to restrict institutions' size, their risk-taking, and their interconnectedness. Indeed, it has allowed the big banks to become even bigger – just as it has failed to stem the flow of profligate executive bonuses. Obama's call on Wall Street yesterday to support "the most ambitious overhaul of the financial system since the Great Depression" is welcome – but the devil, as ever, will be in the detail.

There remain many institutions willing and able to engage in gambling, trading and speculation. There is no justification for this to be done by institutions underwritten by the public. The implicit guarantee distorts the market, providing them a competitive advantage and giving rise to a dynamic of ever-increasing size and concentration. Only their own managerial competence, demonstrated amply by a few institutions, provides a check on the whole process.

The Lehmans episode demonstrates that incompetence has a price. That there would be serious problems in our financial institutions was apparent since early 2007, with the bursting of the bubble. Self-deception led those who had allowed the bubble to develop, who had looked the other way as bad lending practices became routine, to think that the problems were niche or temporary. But after the fall of Bear Stearns, with rumours that Lehmans was next, the Fed and the Treasury should have done a serious job of figuring out how to manage an orderly shutdown of a large, complex institution; and if they determined that they lacked adequate legal authority, they should have requested it.

They appear, remarkably, to have been repeatedly caught off-guard. They claim in the exigency of the moment they were doing the best they could. There was no time for thought. And that explains how they veered from one solution to another: after saying that they did not want to bail out Lehmans because of a concern about moral hazard, they extended the government's safety net further than it had ever been. Bear Stearns extended it to investment banks, and AIG to all financial institutions. Perhaps they were doing the best they could at the time; but that is no excuse for not having anticipated the problems and been better prepared.

Lehman Brothers was a symptom of a dysfunctional financial system and regulatory failure. It should have taught us that preventing problems is easier, and certainly less costly, than dealing with them when they become virtually intractable.