The Occupy Wall Street protests that began in New York City in mid-September have spread across the country, Pat Garofalo noted at ThinkProgress.org (10/7). The choice of Wall Street as the focal point for the protests as even Federal Reserve Chairman Ben Bernanke said makes sense due to the big bank malfeasance that led to the Great Recession.
While the Dodd-Frank financial reform law did a lot to ensure that a repeat of the 2008 financial crisis wont occur through regulation of derivatives, a new consumer protection agency, and new powers for the government to dismantle failing banks the biggest banks still have a firm grip on the financial system, even more so than before the 2008 financial crisis, Garofalo wrote. Here are 11 facts that you need to know about the nations biggest banks:
Bank profits are highest since before the recession: According to the Federal Deposit Insurance Corp., bank profits in the first quarter of this year were the best for the industry since the $36.8 billion earned in the second quarter of 2007. JP Morgan Chase is currently pulling in record profits.
Despite the profits, banks, including Bank of America, Barclays, Goldman Sachs and Credit Suisse, are planning to lay off tens of thousands of workers.
The financial sector accounts for about 30% of total corporate profits, which is actually down from before the financial crisis, when they made closer to 40%.
Since 2008, the biggest banks have gotten bigger: Due to the failure of small competitors and mergers facilitated during the 2008 crisis, the nations biggest banks including Bank of America, JP Morgan Chase, and Wells Fargo are now bigger than they were pre-recession. Pre-crisis, the four biggest banks held 32% of total deposits; now they hold nearly 40%.
The four biggest banks issue 50% of mortgages and 66% of credit cards: Bank of America, JP Morgan Chase, Wells Fargo and Citigroup issue one out of every two mortgages and nearly two out of every three credit cards in America.
The 10 biggest banks hold 60% of bank assets: In the 1980s, the 10 biggest banks controlled 22% of total bank assets. Today, they control 60%.
The six biggest banks hold assets equal to 63% of the countrys GDP: In 1995, the six biggest banks in the country held assets equal to about 17% of the countrys Gross Domestic Product. Now their assets equal 63% of GDP.
The five biggest banks hold 95% of derivatives: Nearly the entire market in derivatives the credit instruments that helped blow up some of the nations biggest banks as well as mega-insurer AIG is dominated by just five firms: JP Morgan Chase, Goldman Sachs, Bank of America, Citibank, and Wells Fargo.
Banks cost households nearly $20 trillion in wealth: Almost $20 trillion in wealth was destroyed by the Great Recession, and total family wealth is still down $12.8 trillion (in 2011 dollars) from June 2007 its last peak.
Big banks dont lend to small businesses: The New Rules Project notes that the countrys 20 biggest banks devote only 18% of their commercial loan portfolios to small business.
Big banks paid 5,000 bonuses of at least $1 million in 2008: According to the New York Attorney Generals office, nine of the financial firms that were among the largest recipients of federal bailout money paid about 5,000 of their traders and bankers bonuses of more than $1 million apiece for 2008.
Garofalo concludes that in the last few decades, regulations on the biggest banks have been systematically eliminated, while those banks engineered more and more ways to both rip off customers and turn ever-more complex trading instruments into ever-higher profits. It makes perfect sense, then, that a movement calling for an economy that works for everyone would center its efforts on an industry that exemplifies the opposite.
TRADE DEALS ON THE MOVE. As we went to press, the House and Senate were expected to vote on three pending trade deals with South Korea, Colombia and Panama. [Breaking—The Senate on 10/12 passed all three trade deals. The Senate votes were 83-15 for Korea, 66-33 for Colombia and 77-22 for Panama. The House tonight passed the Colombia (262-167), Korea (278-151) and Panama (300-129) trade deals. Read more from the AFL-CIO blog.
Ben Lilliston wrote at iatp.org (10/11): The push to further deregulate trade seems to be one of the few things that President Obama and Congressional Republicans can agree on. And it represents, in stark detail, why so many around the country are protesting excess corporate power in Washington. There is no clarion call from the public for more free trade agreements. An NBC/Wall Street Journal poll last year found that 69% of Americans believe free trade deals cost Americans jobs, only 18% believe they create jobs, Lilliston noted.
The AFL-CIO labor federation opposes all three trade deals, but particularly the US-Colombia Free Trade Agreement, because violence against workers is continuing in Colombia. According to the Economic Policy Institute (epi.org), the Korea trade deal will cost 159,000 US jobs while Panama routinely tramples workers rights and shelters money launderers and tax dodgers, Mike Hall noted at blog.aflcio.org.
Among the opponents of the trade deals is the National Farmers Union, whose president, Roger Johnson, said they repeat a deregulatory model that hasnt paid off for US farmers: Agriculture has been one of the few sectors of the US trade economy that consistently has a trade surplus. Since 1990, agriculture has had a positive trade balance every year. With countries that the US has a trade agreement with, US agriculture has a net trade deficit in seven of the past eight years, Johnson said.
VULTURE CAPITALIST FUNDS CAMPAIGN TO SMEAR WALL ST. PROTESTS. The campaign to marginalize and destroy the growing 99% Movement is in full swing, with many in the media attempting to smear the people participating in the occupation protests across the country. However, Lee Fang noted at ThinkProgress.org (10/10) several so-called journalists deriding, and in some cases sabotaging the movement, have paychecks thanks to a billionaire whose business practices have been scorned as among the worst of the financial elite.
As the New York Times has documented, Paul Singer, a Republican activist and hedge fund manager worth over $900 million, has emerged as one of the most important power brokers within the GOP. Now, it appears that the reporters financed by Singer are at the forefront of efforts to tarnish the reputation of 99% Movement demonstrators:
For example, Fang noted that Patrick Howley, an assistant editor for the right-wing American Spectator, admitted in a column posted 10/9 that he had surreptitiously joined an anti-war spin-off group from the OccupyDC protests that planned to demonstrate at a military drone exhibit at the Smithsonians Air and Space museum. Howley wrote that he infiltrated the action and sprinted into the police along with a few protesters in order to mock and undermine the movement. Singer is a major donor to the Spectator, a right-wing magazine known for its role in the Arkansas Project, a well-funded effort to invent stories with the goal of eventually impeaching President Clinton.
Josh Barro, a journalist who has attacked the 99% Movement in the National Review and the New York Daily News, draws a salary from the Wriston Fellowship at the Manhattan Institute, a big business advocacy think tank in New York. Barro makes the same tired arguments, that anti-Wall Street protesters are too inarticulate and extreme to be taken seriously. Singer is the chairman of the Manhattan Institute, and even oversees the Wriston annual fundraiser.
As Singer-funded journalists make their best effort to diminish the Occupy Wall Street protesters as confused idiots unable to articulate a clear goal, it so happens that these journalists are funded by a man who epitomizes the crony capitalist behavior of the greedy one percent.
Singer, manager of a $17 bln hedge fund, earned the moniker vulture capitalist for buying the debt of Third World countries for pennies on the dollar, then using his political and legal connections to extract massive judgements to force collection even from nations suffering from starvation and violent conflicts. Singer and his partners have used such tactics in Panama, Ecuador, Poland, Cote dIvoire, Turkmenistan, and the Democratic Republic of Congo. In addition to squeezing impoverished countries with sovereign debt schemes, Singer speculates in the oil markets, a practice which can lead to gasoline price hikes here in the United States. The revelation that Singer engages in oil speculation, and also funds Republican lawmakers opposed to oil speculation regulations, was exposed by ThinkProgress using leaked government documents.
Singers political philanthropy is tied to his business interests. As Greg Palast has reported, Singer purchased near-bankrupt asbestos companies before his allies in Congress changed an asbestos-liability law to make his investment incredibly profitable (at the expense, critics allege, of sickened workers). More recently, Singer has forged close financial ties to Rep. Scott Garrett (R-N.J.), a little-known lawmaker at the forefront of efforts to repeal Dodd-Frank financial regulations on hedge funds like Elliott Associates, Singers firm.
The rise of Singers political profile can be traced to his work as a top donor to pro-Bush character-assasination groups like the Swift Boat Veterans. In recent years, he has quietly worked with the right-wing billionaire industrialist Koch brothers and Republican strategist Karl Rove to finance a fleet of anti-Obama organizations, including the shady attack ad nonprofit, Crossroads GPS. Singer also led a controversial group of Republican moneymen in a bid to recruit Gov. Chris Christie (R-NJ) into the presidential race, but shifted to endorsing Mitt Romney. Singer and Romney are already close; Singers hedge fund actually manages at least $1 million of the former governors personal investments.
Singers influence even extends to the Supreme Court. As ThinkProgress reported, Singer hosted Justices Clarence Thomas and Samuel Alito to speak at his $5,000-$25,000 a plate dinners.
REBUILD THE DREAM CALLS FOR JOBS NOT CUTS. One of the criticisms of the Occupy Wall Street movement is the lack of a political agenda, but if its policy solutions youre looking for, Van Jones has been organizing the Rebuild The Dream movement (rebuildthedream.com), which engaged 130,000 people over the past 6 months to crowd-source a progressive jobs agenda, the Contract for the American Dream, which was presented at the Take Back the American Dream conference Oct. 3-5 in Washington, D.C.
The most immediate priority is a Jobs Not Cuts agenda to bring pressure on legislators to provide jobs for the unemployed. Jones characterized the period between 9/17 and 11/17 as the American Autumn, with a day of action around the country (11/17), the day before the congressional supercommittee is scheduled to propose a series of budget cuts to reduce the federal deficit.
There will be 100 major state and local actions engaging 1 mln leaders over the next year, covering a range of issues, such as the Ohio workers rights referendum and the effort to counter voter suppression laws passed by Republican legislatures. The movement also will partner with progressive organizations to identify, recruit and support 2,012 American Dream candidates up and down the ballot from school board to Senate next year. The objective is to elect real champions of the middle class through an organizing effort independent of any political party.
A straw poll at the conference showed that President Obamas jobs initiative has strong support, as 65% of participants said they strongly favored the American Jobs Act that Obama sent to Congress, 78% said if anything the plan was too small and 89% said I want Washington to focus more on creating jobs even if that means more spending in the short term.
GA. COUNTIES SAVE MONEY WITH FIRE-FIGHTING CONS. Officials in southeast Georgia are considering putting more inmates in fire stations as a cost-cutting move. Camden County is considering using convict labor, as neighboring Sumter County already does. The prisoners would respond to all emergencies including house fires with traditional firefighters, who in addition to their firefighting and rescue duties would guard the inmates.
One firefighter, Stuart Sullivan, asked Camden County commissioners not to tarnish the department by putting the inmates alongside regular firefighters. If you vote to bring these inmates into our working environment, you jeopardize not only the employees well-being, but the safety of our citizens, he said, according to the Florida Times-Union (10/19). But Commissioner Jimmy Starline said the inmates, who would not be paid for their work, would save the county as much as $500,000 a year.
Georgia has an inmate-firefighters program using state prisoners, mainly to fight wildfires, but because Camden County does not have a state prison, the Times-Union notes, the county would use prisoners from Sumter County, which has used prisoner firefighters for the past two years.
Sumter County Administrator Lynn Taylor said that despite initial outcry against the program, it has been a success, and has saved the county because each inmate is available around the clock.
WARREN MAKES THE RACE IN MASS. Elizabeth Warren, the progressive Dem Senate candidate in Massachusetts, has shown she is not only popular, but she raised $3.15mln from mid-August, when she formed her exploratory committee, until 9/30, with 96% of donors giving less than $100 and 11,000 donors from Massachusetts, she reported (10/10). Scott Brown (R-Mass.) raised $1.55 mln in the third quarter and reported $10.5 mln in the bank, with much of it coming from Wall Street financial interests. Polls show a tight race between Warren and Brown. See elizabethwarren.com.
MONTANA PURSUES SINGLE-PAYER HEALTH PLAN. Montana Gov. Brian Schweitzer (D) said he would pursue a single-payer health system for his state, modeled on the system pioneered by the Canadian province of Saskatchewan. Schweitzer told DailyKos.com (9/30) he would seek a waiver from US Health and Human Services that would let him us Medicaid, Medicare, Veterans Administration and Indian Health Services funds that are provided to the state to pay for a single-payer plan to cover everybody in the state. Montana has a population of 990,000 people, he explained. Saskatchewan has a population of 1,050,000. Their average age is about the same average age of Montana. Theyre about 10% Indian, were about 7.5% Indian. The other ethnic groups theyre a mirror image of us ... So we have the same ethnic population, were farmers, were loggers, were miners, were oil developers ... They, in Saskatchewan, live two years longer and have lower infant mortality.
Saskatchewan spends $4 bln a year on universal health care, about $4,000 per person, while in Montana all systems, public and private, state and federal, spend more than $8 bln, about twice as much per person. So theyre living longer, less infant mortality, and theyre paying half as much, said Schweitzer. Unlike Washington, D.C., that piqued my interest. This is maybe a system that I want to look into.
Vermont has passed a bill to set up a single-payer plan, called Green Mountain Care, and a similar bill is being considered in California, but they also would need to obtain a federal waiver, which under current law could not be granted until 2017. Democrats in Congress are seeking to move that date up to 2014, with President Obamas support.
TENN. VOTER SUPPRESSION WORSE THAN JIM CROW. A 96-year-old black woman never had any problems voting in Tennessee, even during the Jim Crow days. But Dorothy Cooper may have finally met her match with the Republican mandate that she get a photo ID, since she cant prove that shes the same person who was born 96 years ago. When she went to apply for an ID, the Chattanooga Times Free Press reported (10/5), Cooper had a rent receipt, a copy of her lease, her voter registration card and her birth certificate, but she didnt have her marriage certificate that showed her name change, so the clerk denied her a voter ID at the local Driver Service Center.
Cooper never learned to drive, so she never had a drivers license, and her lack of a marriage license is likely due to the fact that shes outlived two husbands. Under Tennessee law, Cooper will be able to vote via absentee ballot. But Cooper told the Times Free Press she will miss going to the pollig place to vote. We always come here to vote, Cooper said. The people who run the polls know everybody here.
Republicans typically justify these voter disenfranchisement laws by claiming that they are necessary to combat voter fraud at the polls, but Ian Milhiser noted at ThinkProgress.org (7/7) that in-person voter fraud is only slightly more common than unicorns. A recent Supreme Court decision upholding a voter ID law was only able to cite one example of in-person voter fraud in the last 143 years. Republicans have been engaged in a systematic effort to make it harder for Dems to vote, as the GOP has passed laws and/or taken executive actions in 14 states that could put obstacles in the way of more than 5 mln eligible voters who do not now have government ID cards, the Brennan Center for Justice reported. Many of them are poor, elderly, black or Latino and could have a hard time navigating the bureaucracy to get a photo ID. The states that have cut back on voting rights will provide 170 electoral votes in 2012 63% of the 270 needed to win the presidency. Of the 12 battleground states, as assessed by an August Los Angeles Times analysis of Gallup polling, five already have cut back on voting rights and two others are considering new restrictions.
Former President Bill Clinton called out the GOP (7/6), saying, There has never been in my lifetime, since we got rid of the poll tax and all the other Jim Crow burdens on voting, the determined effort to limit the franchise that we see today. ... Why is all this going on? This is not rocket science. They are trying to make the 2012 electorate look more like the 2010 electorate than the 2008 electorate.
TOPEKA D.A. WONT PROSECUTE DOMESTIC VIOLENCE. States and cities have laid off teachers, slashed Medicaid funding, put off road and bridge repairs and turned off street lights to cut costs, and now spouse beaters could go unpunished in Topeka, Kansas, as Shawnee County District Attorney Chad Taylor, facing a 10% budget cut, announced that his office will no longer prosecute domestic violence at the county level. Since the county abruptly stopped prosecuting the crimes (9/8), it has rejected 30 cases of domestic violence referred by Topeka police. Sixteen people arrested for misdemeanor domestic battery were released from the county jail after charges werent filed.
Finding those cases suddenly dumped on the city, the Topeka City Council repealed the part of the city code that bans domestic battery.
CAINS 999 PLAN TAXES POOR TO FINANCE TAX BREAKS FOR RICH. The centerpiece of former pizza executive Herman Cains presidential campaign is his 999 plan, which would slash taxes on the wealthy, cut revenue and drive up deficits to the worst point since World War II. But low-income Americans would pay a massive tax increase in the plan that would implement a 9% flat tax on personal income, a 9% tax on corporate net income and a 9% national sales tax. In an interview with CNNs Candy Crowley, Cain said food and clothing would not be exempt from the 9% national sales tax, Amanda Peterson Beadle noted at ThinkProgress.org (10/9). The bottom quintile of earners pays about 2% of their income in federal taxes now, Beadle noted, but under Cains plan they would pay 18%, a nine-fold increase. Middle class individuals would see their taxes go from about 14% to 18%. But someone in the top income levels would see their tax rate fall from 28%.
The Center for American Progress reported that Cains plan would generate less than $1.3 trillion in tax revenue, or about 9.2% of GDP. That sounds like a lot, but its about half of the rate the federal government collected in 2007, when the federal government collected 18.5% of GDP.
MYTH OF SMALL-BIZ TAX HIKE. Republicans arent pleased with Senate Dems proposing a 5.6% surtax on millionaires and billionaires. But thats no excuse to lie, Steve Benen noted at WashingtonMonthly.com (10/6). US Rep. Doug Lamborn (R-Colo.), for example, insisted, There are a lot of so-called millionaires who are small businesses. Theyre not a movie star, theyre not a Hollywood actor, theyre the dry cleaner on the corner. Other Republicans have adopted the same line that the tax hike would hit small business owners and job creators. But Kevin Drum noted at MotherJones.com (9/20) that the Brookings Tax Policy Center last year determined that only 1.9% of small businesses are in the two top brackets that would be affected by letting the Bush tax cuts expire for people making more than $250,000. And about half of that 1.9% arent really small business owners at all. Theyre high-income investors. So were down to about 1% of small businesses that would be affected, Drum noted. And the top brackets are just that: brackets. If the top rate goes back up from 36% to 39.6%, it only affects the portion of income above approximately $400,000. A small business owner making $500,000 would see an increase of about $5,000. This is a fairly modest amount for someone making a half million dollars, and anything higher than that is hardly a small business to begin with. And the marginal effect is even smaller for the second-highest bracket. And the proposed millionaires tax would of course affect only people making more than a million dollars.
FOREIGNER DETAINED UNDER ALA. IMMIGRATION LAW SPRUNG. If you plan to travel through Alabama, you had better have a photo ID or other documentation that you are in the United States legally, as a new state law allows law enforcement officials to detain people suspected of being in the country illegally. The first person detained under Alabamas strict new immigration law was released (10/3), the Associated Press reported, after his attorney produced documents that he was in the country legally. Mohamed Ali Muflahi, 24, of Yemen, was arrested in in Etowah County, Ala., and charged with obstructing a government operation, the Gadsden Times reported (9/30). Before the documentation was produced, Alabama state senators had drafted a letter to US Atty. Gen. Eric Holder calling for the Justice Department to investigate how a citizen of Yemen settled in Alabama without documentation.
At least one water utility in Alabama Allgood Water Works in Blount County is informing its customers that they must produce an Alabama drivers license or picture ID card to continue receiving water service. Under the state law, it is a Class C felony, punishable by up to 10 years in prison, for an undocumented immigrant to attempt to do business with the state or its political subdivisions or for any person to enter into a business transaction on behalf of an undocumented alien in Alabama.
The Montgomery Water Works Board and Sewer Authority started requiring customers to prove their legal status on 9/1, but stopped when a federal judge temporarily suspended implementation of the state law, the Birmingham News reported (9/21). The American Civil Liberties Union of Alabama reported that the Montgomery Water Works was requesting Social Security numbers before setting up water service, the International Business Times reported (10/10). Alabama Power told at least one family that they could not get electricity because of the new law, but the electricity utility later told the National Immigration Legal Center that it no longer interprets the law to mean that undocumented immigrants cannot receive power from the private company.
IMMIGRATION CRACKDOWN COSTS GA. FARMERS. A University of Georgia survey estimates the states fruit and vegetable farmers saw $390 mln in crop losses this year because fewer people are working on Georgias farms, the Atlanta Business Chronicle reported. Farmers reported that crops were left in fields because they had 40% fewer people to help out as migrant workers left the state after Gov. Nathan Deal (R) signed a new law in May requiring that businesses verify workers immigration status.
DEMS HOLD W.V. GOV. Gov. Earl Ray Tomblin (D) narrowly won a special election for governor (10/4), defending himself against Republican attacks that tried to link him with President Obama and his health care reform. Tomblin, then-state Senate president, became governor last year when then-Gov. Joe Manchin was elected to Senate. The Republican Governors Association spent $5 mln on anti-Obama attack ads and Repubs ended up outspending Dems by roughly a 2:1 margin, but Tomblin beat drilling executive Bill Maloney 49.6% to 47%. The office will be up for election again in 2012.
CONSERVADEMS UNDERCUT OBAMA AGAIN. President Obamas jobs bill got a narrow majority support in the Senate (10/11), but Republicans still prevented the bill from advancing, and they got Sens. Jon Tester (D-Mont.) and Ben Nelson (D-Neb.) to side with them against the jobs programs. Greg Sargent noted at WashingtonPost.com before the vote (10/11), Obama has done what skittish Senate Dems and their aides asked him to do he has waged a public campaign to build support for his proposals. ... And yet, now that Dems have finally made that pivot to jobs and are finally fighting it out on turf favorable to themselves; now that Obama has shown its possible to move public opinion in the direction of his proposals, despite his low approval numbers; and now that Obama and Dem leaders are hoping to use GOP opposition to the jobs bill to cast the GOP as the number one enemy of progress on the economy, a handful of moderate Dems are still prepared to help Republicans muddy those waters.
OBAMA CAMPAIGN: GOP SUFFOCATING ECONOMY. The Obama campaign is beginning to suggest that the GOP is deliberately tanking the economy. In a fundraising email before the Senate vote on the jobs bill, Jim Messina, the campaign manager for Obama/Biden 2012, wrote, in part, Senate Republicans want to block [the American Jobs Act]. Not because they have a plan that creates jobs right now not one Republican, in Congress or in the presidential race, does. They only have a political plan.
Their strategy is to suffocate the economy for the sake of what they think will be a political victory. They think that the more folks see Washington taking no action to create jobs, the better their chances in the next election. So theyre doing everything in their power to make sure nothing gets done.
Steve Benen wrote at Washington Monthly (10/11), as near as I can tell, the first time anyone associated with the president has broached the sabotage question at all.
And that strikes me as rather remarkable.
At least Messina is in good company. Michael Cohen, a senior fellow at American Security Project, apparently following up on a discussion I launched last November, recently said, Were far past the point where there is reason to doubt that the GOP is purposely trying to harm the economy.
Sen. Chuck Schumer (D-N.Y.), vice chairman of the Senate Democratic Conference, believes some Republicans want the economy to actually fail on purpose. Paul Krugman recently said in his column, [I]ts hard to avoid the suspicion that GOP leaders actually want the economy to perform badly. Eugene Robinson, a Pulitzer Prize winner, was recently asked whether its possible Republicans would sabotage the economy. Well, let me be honest, he said. It has occurred to me that this is a possibility. E.J. Dionne Jr., Dan Gross,David Frum, and Andrew Sullivan have all raised the same concerns.
99-CENTS SHOPS DO WELL. Anyone trying to understand what Occupy Wall Street protests are all about should consider this news item: The deep-discount retail chain 99 Cents Only just sold itself to a private equity firm and the Canada Pension Plan Investment Board for $1.6 bln. Thats great news for the founding family of the Commerce, Calif. headquartered chain which, unlike several of its big name competitors (Dollar General, Family Dollar) still rigorously adheres to the dollar-limit price tag rule but it is a little less encouraging for what it tells us about the state of the US economy, Andrew Leonard writes at Salon.com (10/11). Simply put, deep discount stores do great when the economy sucks. And as the middle class gets squeezed, the dollar stores have prospered.
WOUNDED VETS KEEP COMING HOME. Since 9/11, 2.2 mln US military service members have been deployed to war zones, with 42% deployed twice or more, Veterans for Common Sense reported (9/29). US military suffered 108,975 casualties, including 6,211 deaths (and that includes 298 war-zone suicides). After deployment, 1.4 mln veterans are eligible for health care and disability benefits and 711,986 (42%) actually were treated, with 367,749 treated for a mental health condition. VA averages 9,700 new patients each month and 9,500 new disability claims each month. The cost of their health and benefits over 40 years is estimated at $900 bln. (See veteransforcommonsense.org for more details and sources of information.)
From The Progressive Populist, November 1, 2011
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