Independent Senator Bernie Sanders delivered a fiery speech on the Senate floor Tuesday, laying out his new 12-point plan for rebuilding the middle class. Steve Kornacki speaks to Sanders about his efforts to make his party more progressive as he considers a bid for president.
Category Archives: Banks
Big Banks Broke America: Why Now’s the Time to Break Our National Addiction
Why are these guys smiling? Since looting all of us for a generous bailout, you’d have thought they’d all lie low. Here’s what they did instead
Jamie Dimon, Lloyd Blankfein (Credit: AP/J. Scott Applewhite/Reuters/Natalie Behring/Photo montage by Salon)
By Robert Hennelly
Progressive America Rising via Salon.com
They just can’t help themselves. Like the drunk that ruins family holiday gatherings year after year, the big banks, once they are caught in yet another episode of their serial criminality, feign contrition, pay billions in fines, and swear to go forth and sin no more.
But these repeat offenders know the law does not apply to them. These 21st century pirates of the Caribbean were actually rewarded for sacking and pillaging America. They never have had a greater share of the pie and they have no allegiance other than global wealth accumulation beyond the reach of any social contract.
The one relationship to which they remain faithful is the fee for service one they have with the members of Congress they showered more than $65 million in campaign donations on since 2012.
You would have thought after they peddled hundreds of billions of dollars in worthless toxic mortgage-backed securities to the nation’s pension funds, setting into motion the largest destruction of American household wealth since the Great Depression, the big banks would have taken their bailout and tried to stay out of the headlines.
But in the years since they took the U.S. economy for a near death spiral spin they have been caught instigating one scam after another. No sooner had the big banks settled with the federal government for perpetrating their massive mortgage fraud and they were back pushing the envelope. Law enforcement and regulatory agencies all scrambled to keep up with these banking behemoths that navigate the line between innovation and criminality with the help of former regulators and prosecutors in their employ.
Continue reading Big Banks Broke America: Why Now’s the Time to Break Our National Addiction
Five Ways Wall Street Continues to Screw Up the Economy for the Rest of Us and How to Fix It
Beaver County Blue via Huffington Post
July 2, 2014 – The shocking thing about the financial collapse of 2008 is not that Wall Street excesses pushed us into the worst economy crisis since the Depression. It’s that the same financial system has been propped back up and that elites are getting richer than ever, while the effects of that collapse are continuing to sandbag the rest of the economy. Oh, and most of this aftermath happened while a Democrat was in the White House.
The biggest banks are bigger and more concentrated than ever.
Subprime (subprime!) is making a comeback  with interest rates of 8 to 13 percent.
Despite Michael Lewis’s devastating expose of how high speed trading is nothing but a technological scam that allows insiders to profit at the expense of small investors, regulators are not moving to abolish it .
The usual suspects are declaring the housing crisis over, even though default and foreclosure rates in the hardest hit cities and states are upwards of 25 percent.
The deficit is falling, now just 2.8 percent of GDP , thanks to massive cuts in social spending. Isn’t that reassuring?
Meanwhile, back in the real economy, good jobs are far too scarce, incomes are stagnant, while 95 percent of the gains go to the top one percent.
Continue reading Five Ways Wall Street Continues to Screw Up the Economy for the Rest of Us and How to Fix It
Job Builder: Create a Pittsburgh Public Bank
North Dakota’s has strengthened the state economy and government finances, explains an attorney
By John E. Hemington Jr.
Beaver County Blue via Pittsburgh Post-Gazette
May 25, 2014 – Since the financial crisis in 2008, state, county and municipal governments across the nation, with the notable exception of North Dakota, have found it increasingly difficult to manage their budgetary responsibilities. Pittsburgh and surrounding communities are no exception.
Some are struggling worse than others, yet all are finding it difficult to balance their budgets and provide necessary services and infrastructure upgrades. Tax revenues are down and taxes have been raised to the hilt in many parts of the country.
Most of the cuts in personnel, purchasing, infrastructure maintenance and programs which can be made have been made. Stimulus grants from federal and state agencies which helped for a while are gone or shrinking.
Many governmental bodies have tried privatization as a solution, selling off valuable community assets, but this generally hasn’t worked out as well as its proponents have claimed. Some, as in Detroit and Jefferson County, Alabama, have simply given up and filed for bankruptcy.
Privatization frequently trades a temporary revenue increase for a long-term decline in public services and increased costs of use. Privatized employees are generally paid lower wages and receive few if any benefits, placing an even greater burden on already overstretched local social services while driving less money into local economies.
So where will the money come from? The answer can be found in North Dakota.
Continue reading Job Builder: Create a Pittsburgh Public Bank
This Chart Is The Fate of Housing In America As Student Loans Bankrupt A Whole Generation
By Wolf Richter
Beaver County Blue via Naked Capitalism
May 19, 2014 – A friend of mine is suffering from excruciating anticipatory pain. He’s heading to New York to attend his daughter’s graduation, which should be a glorious moment in life. But her commencement speaker is Fed Chair Janet Yellen. “Gotta find some thorazine to take before the ceremony,” he muttered. He paid for his daughter’s education. Not many students are that lucky.
Student loan balances soared 362% to $1.1 trillion since 2003, during a period when mortgage debt – including the effects of the current Housing Bubble 2 – rose “only” 65% to $8.2 trillion and credit card debt actually declined by 4.2% to $660 billion (chart). The burden of servicing that increasing pile of student loans is eating into other forms of borrowing and spending, such as the American classic, reckless consumption on credit cards, or the purchase of a home. And so the proportion of first-time buyers – the single most important sign of a healthy housing market – has been shrinking for years.
Continue reading This Chart Is The Fate of Housing In America As Student Loans Bankrupt A Whole Generation
Overthrow the Speculators
Why the Progressive Majority Needs a Common Front vs. Finance Capital, War and the Far Right
By Chris Hedges
Beaver County Blue via Common Dreams
Dec 20, 2013 – Money, as Karl Marx lamented, plays the largest part in determining the course of history. Once speculators are able to concentrate wealth into their hands they have, throughout history, emasculated government, turned the press into lap dogs and courtiers, corrupted the courts and hollowed out public institutions, including universities, to justify their looting and greed.
Today’s speculators have created grotesque financial mechanisms, from usurious interest rates on loans to legalized accounting fraud, to plunge the masses into crippling forms of debt peonage. They steal staggering sums of public funds, such as the $85 billion of mortgage-backed securities and bonds, many of them toxic, that they unload each month on the Federal Reserve in return for cash. And when the public attempts to finance public-works projects they extract billions of dollars through wildly inflated interest rates.
Speculators at megabanks or investment firms such as Goldman Sachs are not, in a strict sense, capitalists. They do not make money from the means of production. Rather, they ignore or rewrite the law—ostensibly put in place to protect the vulnerable from the powerful—to steal from everyone, including their shareholders. They are parasites. They feed off the carcass of industrial capitalism. They produce nothing. They make nothing. They just manipulate money. Speculation in the 17th century was a crime. Speculators were hanged.
We can wrest back control of our economy, and finally our political system, from corporate speculators only by building local movements that decentralize economic power through the creation of hundreds of publicly owned state, county and city banks.
Banksters Devouring Our Future: Student Loan Crisis is Coming to a Head
BY JESSE JACKSON
Beaver county Blue via Chicago Sun-Times
May 13, 2013 – The student loan burden is reaching crisis proportions. Young Americans are being saddled with unsustainable debts. A New York Federal Reserve Bank study found that a stunning 43 percent of 25-year-olds had student loan debts in 2012. Debt now averages over $25,000 for graduates of four-year colleges.
Student loan debt now is about $1 trillion. The only kind of household debt that continued to rise through the recession, student loans now exceed credit card debt and rank second only to mortgages. The percentage of borrowers who are more than 90 days delinquent has risen to 17 percent, up from 10 percent in 2004.
These are the young people who’ve done everything we told them to do. They worked hard, stayed out of trouble, got admitted to college and sacrificed to succeed. Then they graduated, burdened with staggering debt, into the worst economic crisis since the Great Depression. Many can’t find jobs; those who do often end up with low-wage and part-time work and debts they can’t repay.
Student debt is itself a huge obstacle to the recovery. Unless their parents have money, young Americans who achieve the most can’t begin to save for a down payment on a home, start a business or save for retirement.
This crisis stems from the successful conservative efforts to starve government. Cash-strapped state governments cut the contributions made to public colleges and universities. The cost of college was slowly privatized, with more and more left to the student. Those with affluent parents had no problem; those with working parents had to take on debt.
Now the crisis is coming to a head. The sequester and other budget cuts are forcing further cutbacks.
Continue reading Banksters Devouring Our Future: Student Loan Crisis is Coming to a Head
It’s Official: Banks Too Big to Fail are Too Big to Jail
By Robert Borosage
Beaver County Blue
March 7, 2013 – For years, the Obama Administration has been pummeled for failing to bring criminal charges against a single major Wall Street bank or a single leading Wall Street banker for what the FBI termed an “epidemic of fraud” that blew up the entire economy. Investigations revealed the banks committed routine fraud in peddling mortgage securities they knew were garbage, trampled basic property laws, laundered money from Iran, Libya and Mexican drug lords, conspired to game the basic measure of interest rates and more. Yet, time after time, the Justice Department and regulatory agencies settled for sweetheart deals, with no admission of guilt, no banker held accountable, and fines that were the equivalent in earnings of a speeding ticket to the average family.
Yesterday Attorney General Holder stated openly what was already apparent. The Justice Department believes that Too Big to Fail Banks are Too Big to Jail. Criminal indictments against banks or leading bankers might endanger the economy and thus were too big a risk.
Here’s what Holder said
“I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy,” he said. “And I think that is a function of the fact that some of these institutions have become too large.”
Holder was responding to questions by Republican Senator Charles Grassley about why the Justice Department brought no criminal charges against the large British bank HSBC after it admitted laundering money for parties in Iran, Libya and Mexican drug lords.
Continue reading It’s Official: Banks Too Big to Fail are Too Big to Jail
Why We Like Elizabeth Warren!
Elizabeth Warren Grills Banking Regulators at First Hearing
By Rachel Rose Hatman
Democrats eager to see consumer champion Elizabeth Warren take Wall Street’s biggest banks to task got their wish on Thursday when the newly elected Democratic senator made her debut at a Senate Banking Committee hearing.
"What I’d like to know is tell me a little bit about the last few times you’ve taken the biggest financial institutions on Wall Street all the way to a trial," the Massachusetts lawmaker said to applause, speaking to the federal regulators gathered for a hearing on Wall Street reform.
No witnesses spoke up.
Warren raised her eyebrows. "Anybody?" she asked.
Thomas Curry, head of the Office of the Comptroller of the Currency, spoke up: "We’ve actually had a fair number of consent orders. We do not have to bring people to a trial…"
"I appreciate that you say you don’t have to bring them to trial," Warren said. "My question is, when did you bring them to trial?"
"We have not had to do it as a practical matter to achieve our supervisory goals," Curry said.
Warren moved on to the rest of the panel, knowing full well that none of the regulators present have brought a Wall Street bank to trial.
"I’m really concerned that ‘too big to fail’ has become ‘too big for trial,’" Warren later said.
Warren ousted Republican Sen. Scott Brown in November in a hard-fought campaign. She was President Barack Obama’s first pick in 2011 to head up the government’s newly established Consumer Financial Protection Bureau, an entity the former Harvard University law professor and attorney helped create. But Republicans in Washington essentially killed her nomination, citing her record of taking on big banks and Wall Street. That opposition helped boost Warren’s reputation and led Democrats nationwide to embrace her decision to run for U.S. Senate.
Strangling the New Working Class in Its Crib
College Dropouts are Drowning in Debt
By Suzy Khimm
The Washington Post
WASHINGTON, May 29, 2012 — As the nation amasses more than $1 trillion in student loans, education experts say a vexing new problem has emerged: A growing number of young people have a mountain of debt but no degree to show for it.
Nearly 30 percent of college students who took out loans dropped out of school, up from less than a quarter of students a decade ago, according to an analysis of government data earlier this year by think tank Education Sector. College dropouts are also among the most likely to default on their loans, falling behind at a rate four times that of graduates.
That is raising new questions about the wisdom of decades of public policy that focused on increasing access to higher learning but paid less attention to what happens once students arrive on campus. And some education experts have begun to argue that starting college — and going into debt to pay for it — without a clear plan for a diploma is a recipe for disaster.
"They have the economic burden of the debt but they do not get the benefit of higher income and higher levels of employment that one gets with a college degree," said Jack Remondi, chief operating officer at Sallie Mae, the nation’s largest private student lender.
Continue reading Strangling the New Working Class in Its Crib