Source: CMD

Bank Fraud Investigation

President Obama did exactly what hundreds of thousands of us [ed note: MoveOn activists] have been calling on him to do—he announced a federal investigation into Wall Street. Here’s what he said:

“I am asking my Attorney General to create a special unit of federal prosecutors and leading state attorneys general to expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis. This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans.”

MoveOn Press Release Continues

The best part is, progressive champion New York Attorney General Eric Schneiderman is co-chairing the investigation and will make sure it stays on track.

Just weeks ago, this investigation wasn’t even on the table, and the big banks were pushing for a broad settlement that would have made it impossible. Your work changed all that.

This is truly a huge victory for the 99% movement. Hundreds of thousands of us signed petitions, made calls, and held signs outside in the cold to make this issue something that President Obama couldn’t ignore. Here’s some of what MoveOn members and our allies did to bring about this victory:

• Over 360,000 of us signed a petition calling on President Obama to fully investigate the banks.
• We delivered that petition at over 150 events last Thursday around the country at Obama for America campaign offices.
• Our pressure on state attorneys general stopped the rush to a sweetheart deal that would have precluded this investigation.
• And we’ve called, Facebooked, and tweeted at the White House repeatedly to ask the president to launch this investigation.

Progressive victories don’t come that often, and there’s so much more to do. But this is a very big one. Thank you for all you did to make it happen!

–Elena, Emily, Lenore, Robin, and the rest of the [MoveOn]team

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An Occupy Los Angeles protester at the camp outside City Hall in Los Angeles, November 30, 2011. (Photo: Ted Soqui / The New York Times)

Imagine a democratic alternative to police evictions of Occupy encampments across America’s cities and towns. What if the decision to evict or not had been made by referendum? Voters could have determined whether to continue the long overdue public debates over inequality, injustice and capitalism that were launched and sustained above all by the Occupy encampments.

But that never happened in a society where private corporations own parks, lots and other possible Occupy sites. The corporate shareholders and boards of directors of those sites – a tiny minority of the population – could shut down Occupy encampments by invoking property rights. That tiny minority never wanted a national debate that questioned its disproportionate wealth and power. Private property enabled a minority with 1 percent of the wealth and income to make decisions affecting everyone regardless of what a 99 percent majority might want.

In the “public” sites chosen by occupiers, much the same happens. There, tiny numbers of politicians decide to evict, and usually for the same reasons. In New York City, for example, the billionaire mayor who bought his way into politics and power boasted publicly about “his” authority to evict occupiers from Zuccotti Park. In most cases, local politicians, dependent on donations from corporations and the 1 percent and on mass media owned by them, make the same decisions. No surprise there.

Public opinion polls consistently showed majorities of Americans in sympathy with the Occupy Wall Street movement and its basic goals of correcting the inequalities of wealth, income and power in our society. Yet capitalism’s distribution of wealth empowered the 1 percent to overrule those majorities.

The solution for this denial of democracy is to Occupy the Corporation. In one important sense, the workers inside every corporation already occupy it. They are the majority inside every corporation, while the board of directors comprises one small minority and the major shareholders another. If the workers occupied the corporation in the different sense of democratizing it, they would transform corporate capitalist enterprises into democratic, workers’ self-directed enterprises. Then the workers as a whole – a workplace community – would democratically make all the decisions now reserved for corporate boards of directors and their major shareholders. The self-directed workers would then decide what, how and where to produce and what to do with the profits. And they would collaborate with the residential communities that interact with them to build a society far more genuinely democratic than anything that now exists. Such worker self-directed enterprises would have considered, and likely arranged, a democratic decision about Occupy movement encampments.

If corporations became worker self-directed enterprises, many other decisions would likewise be made very differently from how they are made today. For example, workers would not likely overpay a few of their fellow self-directors at the expense of all the others. That would sharply reduce today’s personal wealth inequalities, which corrupt our politics. Likewise, worker self-directors would not have stopped raising real wages in the United States after the 1970s while productivity kept rising. That made sense for capitalist boards of directors to enrich themselves and their shareholders, but it would not have made sense for worker self-directors. Had real wages risen steadily after the 1970s (as they had for the previous century), there would have been no need for the vast growth in workers’ debts since the 1970s. That would not have been good news for private megabanks issuing credit cards and mortgages, but it would have better served the interests of a working class now mired in unsustainable debt. Occupy the Corporation is also a solution for the economic crisis now devastating this country and the globe, making “middle-class disappearance” a common term and generating mounting political and social conflict.

Capitalism’s current crisis needs to be treated differently from the last one, the Great Depression of the 1930s. Then, reforms and regulations (including heavy taxation of corporations and the rich) were the preferred cure. Millions of Americans took to the streets and union halls in successful campaigns to change President Roosevelt’s policies and win a New Deal of reforms and regulations, overcoming corporate resistance. But in the last half-century, corporations’ boards of directors and major shareholders used the profits gathered into their hands – and the power those profits buy – to undo the New Deal. The liberals and left wing of the Democratic Party proved unable or unwilling to prevent corporations from achieving that goal.

If we had occupied the corporations decades ago – reorganizing them as cooperatives directed democratically by their workers – they would not have undone the reforms and regulations that so many people worked so hard to put into place in the 1930s. The lesson of the undoing of the New Deal is this: We cannot respond to this latest capitalist crash with another set of reforms and regulations that leave the organization of enterprises unchanged. If we do, we will have ourselves to blame as we watch corporate boards of directors and major shareholders undo them yet again. Only this time, it well happen faster, because they have had so much practice since the 1930s. The lesson of America’s painful struggles with capitalism’s instability is this: Occupy the corporations and democratize them.

This work by Truthout is licensed under a Creative Commons Attribution-Noncommercial 3.0 United States License.

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Image: Center for Media and Democracy

On Monday, Bank of America (BofA) stocks briefly traded for under $5. Yes, you could buy a share of BofA for less than the noxious debit card fee they tried to force down your throat.

BofA is massive, with assets equivalent to 15 percent of U.S. GDP. So why is it trading for the price of a latte?

Because Wall Street’s dirty little secret is that BofA is a zombie bank. Now the reek is getting too strong to ignore.

The Most Dangerous Bank In America?

In 2008-2009, BofA publicly took $45 billion in TARP bailout funds and secretly took another $91 billion in emergency Federal Reserve loans. According to Bloomberg News, it made $1.5 billion in profits off of those loans. Yet, several analysts predict that BofA is woefully short of capital reserves.

A recent study by NYU’s Stern School of Business ranks BofA as the most systemically risky firm in the United States. These analysts use public information and focus on the capital shortfall that would be experienced by the bank in the event of another crisis. BofA’s weak condition means it is in a position to “create or extend” such a crisis.

As if this were not enough, recent news reports indicate that BofA is trying to move $22 trillion in derivatives out of its Merrill Lynch subsidiary into its FDIC-insured bank. The Fed favors the move (naturally). The FDIC, which provides insurance to depositors if a bank fails, does not.

In this pile of derivatives could be all sorts of problems, including bad European debt, the same kind of debt that brought down Jon Corzine’s derivatives firm, MF Global. Taxpayers don’t backstop MF Global. We do backstop BofA through the FDIC and the Fed.

Obama Promised to End the Era of Big Bank Bailouts

While public rage focused on the $700 billion TARP bailout bill at the height of the crisis, we have learned that far more went out the door from the Fed to aid the big banks. The Center for Media and Democracy tallies the bailout at $4.7 trillion under 35 federal programs. Bloomberg News puts the number closer to $7.7 trillion in loans plus guarantees, which generated $13 billion in profits for the banks.

With European Union countries teetering on the verge of default and no resolution in sight, the U.S. government needs to take decisive action to prevent another bailout of a major American firm – a move sure to generate explosive controversy in an election year.

When President Obama signed the Dodd-Frank Wall Street reform bill in 2010, he promised:

“It will end taxpayer bailouts of Wall Street firms.”

Yet, the “resolution authority” included in the Dodd-Frank Wall Street reform bill requires a joint decision by a group of bank regulators to break up a systemically risky institution. Unfortunately, bank regulators like Tim Geithner and Ben Bernanke, strongly prefer zero accountability and unlimited bailouts.

Time for a Redo

While some on Wall Street frame the financial crisis as events of the distant past, the 99% understand that the crisis hasn’t ended for millions of Americans out of work. It hasn’t ended for small businesses who can’t get credit. It hasn’t ended for the millions of Americans facing foreclosure. And now we learn that a new bailout of BofA could be in the works.

We learned from Ron Suskind’s new book Confidence Men that President Obama ordered the breakup of Citibank at the height of the crisis, but was stonewalled by Tim Geithner. The President’s instincts were good. Now he has an opportunity for a redo.

Most American’s have had it with bailouts of the big banks on Wall Street when so little has been done for Main Street.? ?Banks that are “too big to fail” are too big to exist.

Tell President Obama it’s time to break up Bank of America before it breaks us

~~ Mary Bottari

Related: Move Your Money Roundup

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History suggests that it will take significant hard-core organizing lasting years if not decades to create the infrastructure for a new movement.

Don’t ‘Occupy the Democratic Party’ By Les Leopold

The public understands correctly that Wall Street’s financial elites dominate politics. How else can we account for the fact that the financial sector was rewarded for gambling our economy into debt and killing 8 million jobs in a matter of months?

At the same time, wages are stagnant, benefits are being cut right and left, public sector workers are under attack, and unemployment remains above 8 percent. No wonder Americans believe that both parties are beholden to the 1 percent.

To be sure, the 99 percent framework, so magnificently popularized by Occupy Wall Street, will be deployed by just about everyone to energize the base. Yet, we’re hearing arguments that Occupy Wall Street should occupy the Democratic Party. George Lakoff, for example, writes:

Whatever Occupiers may think of the Democrats, they can gain power within the Democratic Party and hence in election contests all over America. All they have to do is join Democratic Clubs, stick to their values, speak out very loudly, and work in campaigns for candidates at every level who agree with their values. If Occupiers can run tent camps, organize food kitchens and cleanup brigades, run general assemblies, and use social media, they can take over and run a significant part of the Democratic Party.

George, get real! It’s not going to happen. Nor should it.

If Occupy Wall Street has anything at all to do with the 2012 elections, I hope it will organize large demonstrations at both conventions to dramatize the well-documented fact that both parties care more about financial elites than they do about the 99 percent. Of course there are worthy Democrats who have shown the gumption to take on Wall Street. But their power is muted as the Democratic Party overall defers to Wall Street’s lobbyists and campaign funds.

Related: President Obama Richly Deserves to be Dumped

But won’t it always be the lesser of two evils?

For over a generation, we’ve watched the Democratic Party move steadily to the right and increasingly accommodate the top 1 percent. (In case you have any lingering doubts, read Winner Take All Politics, by Jacob Hacker and Paul Pierson.) The Wall Street orgy of the last 30 years was built upon the deregulatory push initiated by Jimmy Carter and then accelerated by Bill Clinton.

Wall Street–friendly policies continue today, actualized by Obama’s appointment of Tim Geithner as Treasury Secretary. Even after the enormous crash, born and bred on Wall Street, the needs of the financial elites still come first. The banks who caused the crash, we recently discovered, had access to $7.77 trillion in secret bailouts, while the real economy languished.

Nevertheless, labor and progressive organizations see no other option save the Democrats. They believe it’s a fool’s errand even to consider a political alternative because, they argue, third parties always fail, sometimes miserably. (They feel particularly burned by Ralph Nader’s run, which they believe put G.W. Bush into office.)

So what’s to be done?

Learning from the Populist Movement

For starters, we should investigate carefully the last massive movement that explicitly challenged the one percent and that demanded a democratization of high finance — the Populists of the late 1880s.

Sounds ancient and irrelevant? No so. This made-in-America movement grew out of the horrendous conditions faced by small farmers, especially in the South. In order to survive through the winter, farmers had to pledge their future crops to one dominant local merchant in exchange for food and supplies. The merchant (then called “The Man”) would charge outrageous interest rates, insuring that eventually farmers would have to sign over title to their land in order to settle their debts. As a result, thousands of independent farmers turned into impoverished sharecroppers.

All the necessities of farming, from the grain elevators to farm implements to the railroads were run by monopolies that squeezed the farmers dry. To compound these problems, the U.S. money supply was limited to a fixed quantity of gold, as demanded by Wall Street. This insured that as the population grew, the money supply would remain fixed, leading to enormous downward pressures on farm prices. It was a continuous rural depression as black and white farmers drifted into peonage. (Will rising student loans do something similar to the next generation? Will all of us be indebted to a handful of Wall Street banks?)

Yet, even in this state of misery, farmers’ alliances formed to build cooperatives designed to get them out from under the monopoly structures. They eventually linked together into the National Farmers Alliance that developed “sub-alliances” in thousands of counties in the South and Midwest. At great peril, black farmers also organized and joined in the movement.

To aid in the organizing, the Alliance sent out over 4,000 “lecturers” who held give and take sessions about how to build cooperatives and how to reform the economy. But after nearly a decade of organizing, it became clear that the farmer cooperatives could not succeed, because the monopolies deliberately denied them badly needed credit, and because the money supply was enormously constricted by Wall Street. (There was no Federal Reserve to do the dirty work for them.)

This led the populist movement to develop its most radical and original idea — the creation of a democratized monetary system independent of Wall Street. In their plan, farmers could bring their crops to federally sponsored warehouses and get federal paper currency as credit until their crops were sold at decent prices.

This “sub-treasury” system, as they called it, would dramatically inflate the money supply, making it easier for farmers to retire their debts. It also would totally undermine the hard metal monetary system that was owned and operated by a handful of Wall Street banks. If ever there was a battle between the 99 percent and the 1 percent, this was it. (Contrary to popular lore, the Populist movement was not about “free silver.” That was an import from liberal Democratic politicians like William Jennings Bryan, who rejected the more radical Populist platform, including the sub-treasury system.)

By 1890, after a decade of grass roots organizing, the Farmers Alliance realized that it must engage directly in politics in order to keep its cooperatives and their farms from ruin. The South, at the time, was dominated by white Bourbon Democrats — the merchants, planters, and other elites who used terror and ballot stuffing to maintain their racist grip on post-Reconstruction political power. In the North and West, the Republicans were the party of the gilded elites and maintained their power by “waving the bloody flag” of the Civil War against the Southern Democrats and their Northern Catholic immigrant allies. Both parties were completely in the grip of the new industrial and financial elites.

Out of these conditions grew the People’s Party, one of the most powerful third party alternatives in U.S. history. But it didn’t end well. In 1896 the People’s Party was hijacked by a group of ambitious politicians who rammed through a fusion ticket behind the Democratic presidential nominee, William Jennings Bryan. That retreat, combined with Bryan’s defeat, alienated the farmer base within the National Farmers Alliance. With the failure to achieve political power, the cooperative movement was starved to death due to lack of credit and faded away. More and more small farmers lost their land and slipped into abject poverty as the elites tightened their grip on political power and held it, with few exceptions, until the New Deal. (See Lawrence Goodwin’s The Populist Moment for a definitive account.)

There were four essential movement building components of populism that perhaps provide a way for us to measure where we are today and where we need to go:

1. Shared Movement Experiences: The populist cooperatives provided the day-to-day shared experiences that bound the movement together on a local, state, and national level. People worked together and struggled together against powerful opponents, often having to suffer vigilante violence to protect their budding cooperatives that stored produce and livestock, and that sold food, supplies, and farm implements. These shared experiences built up the courage and self-respect of millions of participants. They felt part of something big and important. They shared the common identity of populism.

   And today? While there are thousands of cooperatives and progressive nonprofit organizations in the country today, they are not linked in substantial ways. It’s also not clear if they are creating the common experiences necessary for movement building.

   The Occupy Wall Street encampments certainly are (or were) creating such communities, but as currently conceived and constructed, they just aren’t suitable for those who don’t want to encamp. Also it’s not clear if the encampments will survive the current round of evictions.

   Some unions also have developed powerful internal collective cultures. But unfortunately, union density continues to decline. As it does, the focus often narrows to internal collective bargaining issues. The Wisconsin campaign in defense of public sector workers’ rights was a new moment that certainly created a shared sense of movement. Yet, it seems destined to flow into the Democratic Party.

   The environmental campaign against the Keystone XL pipeline also has the potential to build a common collective experience among its participants. But it may have difficulty as it collides with unions and politicians who claim the pipeline will create badly needed jobs.

   The obvious point is that at the moment these efforts, and many others that could be listed, are fragmented and unconnected. We have a long way to go to build a common collective experience that matches the power of the populist cooperative movement.

2. Systematic Education:The populist lecturing system also was key to movement building as it developed a dialogue with everyday farmers about how the economic system really worked and what the movement should stand for. The base of the movement, not just the leadership, became financially literate as it debated and understood the need for a radical restructuring of the financial system based on the “sub-treasury plan.”

   And today? We don’t as yet have anything like a “lecturer” system to engage the American public in an educational discussion. But one could be built in a hurry. There are plenty of us who could link together to build a “Economics for the 99 Percent” program. But it may need something larger to get it going and give it purpose.

3. Independent Media: The populist movement was well-supported with a rag-tag collection of small, but vital newspapers and journals — about 100 of them — throughout the country. These media outlets provided continual news about the key economic and political issues of the day. Its editors ran their journals on a shoestring in order to maintain their independence and the clarity of their message.

   And today? We do indeed have our rag-tag newsletters, journals, and thousands of websites, with Alternet.org being one of the best. Running on a shoestring is nothing new to them. But at the moment, there is little coordination or shared identity. But that could come as a movement grows.

4. The Peoples’ Government: And finally the populist movement’s base and its leadership truly believed that the American government belonged to them — they should be able to run political institutions just like the founding fathers had promised. As true democrats, they were not intimidated by money or power. They were decidedly not anti-government.

   And today? We are much more ambivalent about our relationship to governing than our forefathers ever were. Do we still feel capable of collectively exercising power to stop the financial predators from running the country? The jury is out.

These comparisons, although superficial, suggests that we’ve got a long haul ahead. Wall Street will not concede either its power or its wealth unless confronted with an enormous 99 percent movement. They’re not worried about neutering the Democratic Party. But they are concerned that something new and unforeseen might emerge.

“99 Percent Clubs”

It seems that many of us are hoping that somehow Twitter and Facebook messages will spontaneously explode into a new movement with a million people in the streets just like in Cairo. But, history suggests that it will take significant hard-core organizing lasting years if not decades to create the infrastructure for a new movement.

One way to start is by forming decentralized “99 Percent Clubs.” Any group of individuals could form a club and then develop activities to popularize and dramatize the 99 percent framework. Some clubs might be aggressive by helping to prevent evictions in their area or by directly supporting Occupy Wall Street actions. Others might engage in more educational activities like passing out material about financial elites in front of banks. Still other 99 percent clubs might work on national efforts to forgive student loans. But the point is, we need shared spaces where the 99 percent can work with each other to share experiences and build a shared identity. We need a common club with a common identity rather than just continuing our good works inside our issue silos.

I realize that it would probably take an organizational miracle to pull this off. But imagine if a thousand 99 Percent Clubs sprung up around the country in the next several months. We’d be well on our way to building a vast network that could create a tactile presence for the 99 percent. Add a little Twitter and Facebook to the mix, and you could even imagine common actions that linked the thousand clubs. And we certainly could count on Occupy Wall Street to lead the charge in provocative ways.

But let’s be very clear. Even such a miraculous organizing effort will not get us to a political alternative by 2012. It will take years and years of hard work, of trial-and-error activities, of experiments in linkages, of many attempts to forge and test a common program, and so on. We’re either in it for the long haul, or it won’t happen at all.

Dream on? Maybe. But we really do need an alternative vehicle to the two dominant political parties. Otherwise, we’ll be voting for the lesser of two evils for yet another generation as we suffer through outrageous levels of unemployment and round after round of social safety-net cuts. It won’t be pretty as Wall Street’s “markets” demand fiscal austerity to protect their booty.

At this point, I’ll settle for a modest beginning. Let’s hope we can muster up the vision and the patience at least to discuss and imagine an alternative political path.

Les Leopold is the executive director of the Labor Institute and Public Health Institute in New York, and author of The Looting of America: How Wall Street’s Game of Fantasy Finance Destroyed Our Jobs, Pensions, and Prosperity — and What We Can Do About It (Chelsea Green, 2009).

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There was one remark in last night’s GOP debate that we here at PFAW whole-heartedly agreed with. Asked about his view on judicial appointments, Mitt Romney said:

Let me note that the key thing I think the president is going to do, is going to be with the longest legacy. It’s going to be appointing Supreme Court and justices throughout the judicial system. As many as half the justices in the next four years are going to be appointed by the next president.

Judicial nominees will indeed be the most lasting legacy of the next president. And that’s why we can’t afford to hand over those decisions to Mitt Romney.

At last night’s debate, Romney joined his fellow candidates in praising Justices John Roberts, Antonin Scalia, Samuel Alito and Clarence Thomas, the Supreme Court’s ultra-conservative base. Under these justices, the Court has moved farther to the right than it has in decades, consistently privileging big corporations over individual Americans. When Romney declared this summer that “corporations are people, my friend,” he was summarizing, and approving of, the Court’s decision in Citizens United v. FEC.

But it’s not just that Romney wants more Alitos and Thomases on the Supreme Court. Romney sent a signal that he would move the federal courts even farther to the right than they are today when he took on Robert Bork as his campaign’s chief legal advisor. Bork’s conservativism is so extreme that a bipartisan majority of the Senate rejected him for the Supreme Court in 1987. He was against the Civil Rights Act of 1964. He thought it was just fine to criminalize homosexuality. He was a professed fan of censorship. And since then, he has become even more extreme in his defense of corporate power and dismissal of individual rights. But not, apparently, too extreme for Mitt Romney.

Romney is absolutely right that appointing judges will be “the key thing” the next president will do. And it’s exactly the reason why he shouldn’t be president.

More on Robert Bork … here

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From UKIAH (CA) Community Blog published December 16, 2011

As evidence of a failed Obama presidency accumulates, criticism of his administration is mounting from liberal Democrats who have too much moral authority to be ignored.

Most prominent among these critics is veteran journalist Bill Moyers, whose October address to a Public Citizen gathering puts the lie to our barely Democratic president’s populist pantomime, acted out last week in a Kansas speech decrying the plight of “innocent, hardworking Americans.” In his talk, Moyers quoted an authentic Kansas populist, Mary Elizabeth Lease, who in 1890 declared, “Wall Street owns the country…. Money rules…. The [political] parties lie to us and the political speakers mislead us.”

A former aide to Lyndon Johnson who knows politics from the inside, Moyers then delivered the coup de grace: “[Lease] should see us now. John Boehner calls on the bankers, holds out his cup, and offers them total obeisance from the House majority if only they fill it. Barack Obama criticizes bankers as fat cats, then invites them to dine at a pricey New York restaurant where the tasting menu runs to $195 a person.”

As it happens, Moyers’s remarks anticipated the trenchant question posed in an interview by another prominent liberal, Barbara Ehrenreich, just after billionaire Michael Bloomberg and mayors of other cities cleared public spaces of Occupy Wall Street protesters: “Where in all this was Obama? Why couldn’t he have picked up the phone and called the mayors of Portland and Oakland and said: ‘Go easy on these people. They represent the anger and aspirations of the majority.’ Would that have been so difficult?” Well, yes, particularly if your principal occupation is shaking down bankers and brokers for campaign donations on the Upper East Side of Manhattan.

Related: Mr. President, Stop Protecting Bankers From These State Law Enforcement Officials

By now it should be obvious that the system, and the Democratic Party, run Obama, not the other way around. Under this arrangement, the president carries out his duties as pre-eminent party functionary—fundraising being at the top of his list of responsibilities—and defers on legislation, leaving it to corrupt Democratic barons such as Sen. Max Baucus (D., Mont.), devoted friend of the insurance, pharmaceutical, and banking crowd, and sworn enemy of reform.

As Ron Suskind’s book “Confidence Men” confirms, there was never any question of doing things differently. Describing the then president-elect’s choice of economic advisers, he notes, “Obama, after all, had selected for his top domestic officials two men [Lawrence Summers and Timothy Geithner] whose actions [in the Clinton Administration] had contributed to the very financial disaster they were hired to solve.” These anti-reform appointments did not go unnoticed by party regulars, even though they were ignored by Obama groupies. “I don’t understand how you could do this,” Suskind quotes Sen. Byron Dorgan (D., N.D.) saying to Obama. “You’ve picked the wrong people!”

The “wrong people” included Rahm Emanuel, now mayor of Chicago, and his replacement as White House chief of staff, William Daley; both of these advisers were four-star generals within the Chicago Democratic machine who cut their teeth in Washington during the campaign to pass that job-killer North American Free Trade Act and who later worked for investment banks. But Obama’s hypocrisy in Osawatomie, Kansas, set a new standard in deception. Among other things, his speech blamed “regulators who were supposed to warn us about the dangers of all this [the unfettered sales of bundled mortgages], but looked the other way or didn’t have the authority to look at all. It was wrong. It combined the breathtaking greed of a few with irresponsibility all across the system.”

What’s truly breathtaking is the president’s gall, his stunning contempt for political history and contemporary reality. Besides neglecting to mention Democratic complicity in the debacle of 2008, he failed to point out that derivatives trading remains largely unregulated while the Securities and Exchange Commission awaits “public comment on a detailed implementation plan” for future regulation. In other words, until the banking and brokerage lobbies have had their say with John Boehner, Max Baucus, and Secretary of the Treasury Tim Geithner. Meanwhile, the administration steadfastly opposes a restoration of the Glass-Steagall Act, the New Deal law that reduced outlandish speculation by separating commercial and investment banks. In 1999, it was Summers and Geithner, led by Bill Clinton’s Treasury Secretary Robert Rubin (much admired by Obama), who persuaded Congress to repeal this crucial impediment to Wall Street recklessness.

And then there’s Afghanistan. Obama should be condemned for escalating this grotesquely expensive, destructive, and self-defeating war. Thoroughly discredited by analysts on both the left and the right, the Afghan madness seems to bore liberals who once would have marched against Vietnam. I suggest they watch the brilliant new documentary “Hell and Back Again” to enhance their knowledge of the war’s casualties. The pitiful story of Marine sergeant Nathan Harris ought to make them furious at our commander in chief; shouldn’t it also spark an intra-party revolt?

Related: Anniversery is apt time to re-evaluate Endless War

I urge people who haven’t given up on politics to examine the career of Allard Lowenstein. Lowenstein founded the Dump Johnson movement in 1967 and, against all odds, persuaded Senator Eugene McCarthy of Minnesota to launch a Democratic primary challenge against the incumbent president over the issue of Vietnam. His example, I hope, might inspire someone to challenge another Democratic incumbent who has forfeited the trust of the people.

You may say it’s too late, that Obama is impregnable. Consider Gene McCarthy’s obscurity on November 30, 1967, when he announced his insurgent crusade. At the time, many Americans confused him with Senator Joe McCarthy (R., Wis.), the notorious communist hunter, and in January 1968 a Gallup poll showed him winning just 12 percent of the votes in a presidential election. But on March 12, McCarthy nearly beat Johnson in the New Hampshire primary. The opposition was galvanized, Robert Kennedy jumped into the race, LBJ announced he would not seek re-election, and American democracy was revived.

Granted, there are big differences between 1968 and 2012 — for one thing, there’s no military draft to frighten the young — but the great issues are the same: an immoral war and a merciless money power. Moreover, high unemployment and the dominance of Wall Street do frighten the young. They need a tribune.

In November 1967, before he announced his candidacy, McCarthy told an audience of college students, “There is deep anxiety and alienation among a large number of people…. Someone must give these groups entrance back into the political processes. We may lose, but at least in the process of fighting within the political framework, we’ll have reduced the alienation.” Two days later, in remarks that would have pertained just as well to the current Occupy Wall Street movement, he said, “Party unity is not a sufficient excuse for silence” and Vietnam was “not the kind of political controversy which should be left to a children’s crusade or to those not directly involved in politics. It should rather be taken up by adult political leaders and activists in America.”

Are there any adults left in the Democratic Party?

~

Related: Barack Obama End of 2010 Scorecard

John R. MacArthur is publisher of Harper’s Magazine and author of the book You Can’t Be President: The Outrageous Barriers to Democracy in America. This column originally appeared in the Providence Journal on December 14, 2011.

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Lately we’ve been hearing some strong words from President Obama about Wall Street crime. But when the cameras and lights aren’t around, his administration’s been working feverishly to protect bankers from state law enforcement officials.

There are conscientious state attorneys general who believe the law applies to everyone. While they’re working to bring justice to Wall Street, White House officials are obstructing them by pushing a sweetheart deal with the banks that would end their investigations and prevent them from prosecuting crooked bankers.

If more people knew what was happening, the White House would be flooded with calls and emails demanding that it stop protecting Wall Street.

It’s still not too late for that.

The Evidence

The evidence for Wall Street’s criminality is overwhelming. The big banks have already signed consent decrees and other documents in response to well-documented charges of perjury and filing of false documents; illegal foreclosures; criminal solicitation through the repeated use of law firms and foreclosure servicers known to have violated the law; investor fraud; and other major crimes.

Wall Street’s lawbreaking crashed the economy, left millions of people jobless, and cost the world’s economy trillions of dollars in lost wealth. People have been illegally evicted, and millions were deceived into borrowing money for real estate whose value had been artificially inflated through illegal means, and who now owe that money to the same bankers who committed the crimes.

But none of the criminals have gone to jail—and they’re still collecting on those loans.

The Resistance

The responsibility for prosecuting crooked bankers belongs to both the Justice Department and the attorneys general who serve as their states’ chief law enforcement officers. AGs for all 50 states were brought together to negotiate with the banks over Wall Street mortgage fraud, and quickly came under intense pressure from the administration and corporate interests. Under the leadership of self-serving Iowa Attorney General Tom Miller, the group began to discuss a White House-backed deal that would protect criminal bankers from prosecution and let the banks settle for pennies on the dollar.

The first AG to reject the deal was New York’s Eric Schneiderman, whose jurisdiction includes Wall Street. Schneiderman had been pursuing criminal investigations and asked the group not to accept any agreement that would shut them down before all the evidence was in. He immediately came in for some heavy arm-twisting from Obama officials like HUD Secretary Shaun Donovan and top people at the Justice Department—the same Justice Department that has refused to prosecute a single banker for criminal fraud, and can only offer weak and implausible excuses for its failure to do so.

Ohio’s Miller immediately removed Schneiderman from the committee leading negotiations for the 50-member AG group, despite his state’s key role in prosecuting bank fraud. That move was either designed to remove Schneiderman from the room while negotiating with (and for) the banks, or it was Miller’s petty way of saying “you can’t sit with us in the school cafeteria anymore.” Maybe it was both.

Schneiderman nevertheless soldiered on, apparently undeterred by either the administration’s arm-twisting or Miller’s “you are so not hanging with us, dude” tactics.

Kentucky Attorney General Jack Conway soon stepped up and backed Schneiderman, saying “There should be absolutely no criminal or civil immunity given to banks for activity that has not yet been investigated.” Delaware’s Beau Biden also joined with Schneiderman, and that’s important. Many New York-based companies, including my ex-employer AIG, are legally incorporated in Delaware to take advantage of that state’s favorable corporate tax policies. (Biden’s also resisting the administration that his dad serves as vice president, which must make for interesting dinner table conversations at holiday time.)

Massachusetts AG Martha Coakley has sued five banks for allegedly seizing private property illegally. And the AGs of California and Nevada, Kamala Harris and Catherine Cortez Masto, have announced a joint investigation of the massive bank mortgage activity in their states.

These AGs are fighting corporate influence in order to uphold the law. They’re on the right side of this fight. Look who’s not.

The Deal

For reasons known only to themselves, officials in the Obama administration have spent more than a year trying to undercut these AGs. They’re pushing a deal that would end their investigations before they’re even completed and would immunize bankers from criminal prosecution.

Like the Security and Exchange Commission’s notorious sweetheart deals, this Obama-backed settlement would let banks buy their way out of prosecution with a slap-on-the-wrist settlement of $20 billion-$25 billion. It would also create a phony refinancing program to make it look as if banks are doing something about the tragedies they’ve created by promising to refinance “as many as” 300,000 underwater mortgages (meaning the real number could be much smaller than that).

It’s one more get-out-of-jail-free card for criminals on Wall Street.

The Damage

The social damage from this deal would be enormous. Consider:

 

• It reinforces criminal behavior: Once again crooked bankers would go unpunished. That would guarantee they’ll commit these kinds of crimes again and again, knowing they’ll never pay for it with their time or their money. Thanks to other soft deals like this one, big bank executives have already promised to stop their crimes (while “neither admitting nor denying wrongdoing”) — and then repeated them again and again, 51 times!
• The victims will pay for the crimes: Bankers defrauded their own investors by concealing their own true financial picture. The money paid in this settlement deal will be paid, not by the lawbreaking bankers who got rich off their own crimes, but by the very same shareholders they defrauded.
• It places the perps in charge of their own restitution: The refinancing program (for “as many as” 300,000 homeowners) will be run by the banks themselves. The last administration program designed to ‘help’ homeowners became a tool for banks to rip them off even more. Mortgage servicers misstated their figures in that program as much as 80 percent of the time. Bankers used it to extract more money from homeowners, then foreclosed on them anyway (often with false documents or inaccurate figures) while the Administration looked the other way.
• The settlement amount is a tiny fraction of the harm caused: There are 11.1 million underwater mortgages. Homeowners still owe the banks $750 billion for housing value that has evaporated. The banks artificially pumped out real estate values, these homeowners borrowed against the inflated prices, the housing market crashed—and they’re left holding the bag while bankers are holding their bonuses. And they still owe the banks all that money.
• It undermines the fabric of social trust: This deal reinforces the message that there’s one code of justice for the rich and powerful and another for everyone else. And that government works for the rich and powerful, while the rest of us are on our own.

The Letter

We should be grateful for the courage and determination of these AGs. They need and deserve the public’s recognition and support. Voters need to tell the president that it’s wrong and unacceptable to push for a bank-friendly deal and undermine these public servants.

What’s your note to the White House going to say? Mine will go something like this:

Dear Mr. President:

That was one terrific speech you gave in Kansas the other day. It was great when you promised to make sure that “penalties count” for bankers. And you were absolutely right when you said that “Wall Street firms (keep) violating major anti-fraud laws because the penalties are too weak and there’s no price for being a repeat offender.”

If you believe that, why is your administration working so hard to protect bankers from state law? I admire Eric Schneiderman, Beau Biden, Jack Conway, Martha Coakley, Kamala Harris, and Catherine Cortez Masto. Why is your staff pressuring them to stop investigating these crimes and let bankers off the hook?

If you meant what you said, Mr. President, please tell your staff to back off and let these good people do the jobs they were elected to do.

Mr. President, you said in Kansas that “a strong middle class can only exist in an economy where everyone plays by the same rules, from Wall Street to Main Street.” So why is your administration trying to stop the states from enforcing those rules?

You were right when you said that “there is a deficit of trust between Main Street and Wall Street.” Please restore and protect the trust between those streets – and with Pennsylvania Avenue – by directing your administration to stop pushing this corrupt deal and support attorneys general Schneiderman, Biden, Conway, Coakley, Harris, and Masto.

Respectfully yours,

A Voter

Related Post: Banks won’t get off that easy in Mass.

NOBODY AT the White House got served when Attorney General Martha Coakley announced a blockbuster lawsuit against five of the biggest mortgage banks in Massachusetts last week. But it’s the folks whose continued employment hinges on next year’s election, and not the banks who were hit with allegations about rampant foreclosure fraud, who should really be worried about the suit.

Massachusetts isn’t suing Bank of America, JP Morgan, Citigroup, Wells Fargo, and GMAC because a couple lawyers in the AG’s office just discovered that banks have been using shoddy paperwork to seize Bay State residents’ homes. Coakley sued because the homeowners who’ve been bearing the brunt of the foreclosure crisis shouldn’t also get abused by a nationwide legal settlement that will end most of the banks’ foreclosure liabilities.
~~By Paul McMorrow

Related: ProPublica: Where are they now?

Posted by Gypsy Chief

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Photo: Center for Media and Democracy

Published December 4, 2011 in PR Watch written by Anne Landman.

Lender Processing Services, Inc. (LPS) of Jacksonville, Florida — one of the most notorious processors of fraudulent home foreclosure documents in the country — has donated 1,000 tickets for a professional football game between the Jacksonville Jaguars and the San Diego Chargers to Jacksonville Area USO. After the 2008 economic bust, LPS subsidiary DocX churned out huge numbers of fraudulent foreclosure documents for the country’s biggest banks, including Wells Fargo, HSBC, Deutsche Bank, Citibank, U.S. Bank and Bank of America, which resulted in countless Americans being wrongfully thrown out of their homes. DocX hired boiler rooms full of people, some of whom were high school students, and paid them $10 an hour to fraudulently robosign the name “Linda Green” onto hundreds of thousands of foreclosure documents, and then hired notary publics to falsely notarize the fake signatures. “Linda Green” was later found to be listed as vice president of over 20 banks and multiple “Linda Greens” were featured in a 60 Minutes investigation. LPS denies responsibility for the massive fraud, preferring instead to let two DocX employees take the fall for the entire debacle. On November 28, 2011, Tracy Lawrence, a Las Vegas notary public who had agreed to testify against the two DocX employees, was found dead in her home on the day she was to testify. LPS says the ticket donation is a “perfect way for us to help the courageous members of our armed forces enjoy some much-needed relaxation and to show our continued support for the Jacksonville Jaguars and our city.”

Related: Bank of America Internal Email on Occupy Wall Street

Related: Unequal Justice: Banker Arrests, 0, Protestor Arrests, 2,511

Related: Bank of America CEO ‘Incensed’ That So Many People Keep Pointing Out How Awful His Bank Is

Related: The Robo-Signing Mess Is Just the Tip of the Iceberg, Mortgage Putbacks Will Be the Harbinger of the Collapse of Big Banks that Will Dwarf 2008!

This is what is truly at stake – the United States is now at risk of losing its hegemony of the financial capital of the world! Why? Because when we had the chance to put the injured banks to sleep and redirect resources to into new productivity, we instead allowed politics to shovel tax payer capital into zombie institutions as they turned around and paid it right back out as bonuses. As a result, significant capital has been destroyed, the original problem has metastized, and the banks are still in zombie status, but with share prices that are multiples of the actual values of the entities that they allegedly represent – a perfect storm for a market crash that will make 2008 look like a bull rally!
Source: Reggie Middleton

Posted by Gypsy Chief

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Published November 25, 2011 in Just a Holiday Reminder by Charles Hugh Smith.

You’d never know it from the media coverage, but Black Friday sales are essentially meaningless noise in the U.S. economy.

You know the economy and stock market are in deep trouble when the Mainstream Media elevates one essentially meaningless metric to “The One Meaningful Statistic” and then trumpets it slavishly. One such meaningless metric is Black Friday.

The Media has glommed onto Black Friday for a number of flawed reasons, number one being the MSM’s ceaseless drive to reduce all complex problems down to something that can be expressed in a sound-bite voiceover and a video clip of a crowded mall.

Balance of article here

Posted by Gypsy Chief

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Posted by Gypsy Chief

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