October 2011 archive

Banking and Politics: On a Razor’s Edge

By Mike Lux, Crooks and Liars

October 27, 2011 11:00 AM

This is a do-over moment for the President. Ron Suskind’s book, “Confidence Men,” made clear: Obama wanted to do the right thing on the big banks in 2009. He wanted us to choose the path Sweden chose to get back to economic health in the 1990s -rather than the one that led to Japan’s lost decade - a path that involved directly taking on the big banks. He wanted to take over Citibank and send it to resolution authority. But Rahm Emanuel, Larry Summers and Geithner didn’t follow his orders, slow-walked things until they weren’t relevant anymore, and gave us the policies that are potentially sending us to our own lost decade. These missed policy chances gave us a terribly weakened economy, and gave the public the perception the President was soft on Wall Street. Obama now has a chance to get this economy back on the road to a real recovery, and to simultaneously show that he will stand up the Wall Street tycoons.

When Dodd-Frank was passed, we were promised there would be no more bank bailouts, and that our government was once again capable of doing what needs to be done in terms of bringing the Wall Street tycoons who wrecked our economy to heel. Now is the moment to prove that right. Start by putting the zombie bank Bank of America in receivership where they belong – the Dodd-Frank bill gives us the resolution authority to get that done. Next, drop efforts to give bankers immunity for the million-plus counts of perjury and fraud they have likely committed with the robo-signing and other foreclosure-related scandals, and force them to the table so they will finally write down the mortgage debt on all these underwater mortgages. Finally, get DOJ involved in helping to investigate fraudulent banking practices, and get the anti-trust division involved too, because unless these banks start to get broken up, our financial marketplace will continue to be badly warped by their overwhelming market power.

…

These are huge steps, but the Obama administration has the ability to do them. If the 2008 crisis proved nothing else, it is that our government in a financial crisis has the ability to do whatever needs to be done in a crisis. There’s a story that when Bear Stearns was being forced by Hank Paulson to merge with Morgan in 2008, that the Bear Stearns board was balking at the incredibly low price they would be getting on their shares of stock. Paulson calmly informed them he had brought a team of FBI agents with them, that if the merger was not agreed to he would be seizing every computer in the building and the FBI would start combing through the books and emails to see what illegal acts were committed. The Bear Stearns board immediately voted to go forward with the merger. The management of these huge banks on Wall Street know they have been blatantly violating all kinds of laws for a long time, which is why they are so eager to do a quick settlement with the state AGs and the feds for legal immunity. The administration has the tools, both legal and regulatory, to force them to the table and get things done. But they need to step up and make it happen. Given the deep and overwhelming problems in the financial and housing sectors, doing big things is the only way to get the economy back on track.

And they all lived in fairy-tale land happily ever after.

Or…

Not so much.

The Congressional Budget Office (CBO) recently released a report that added more evidence that income inequality between the top American income earners and the middle and lower classes continues to grow, as the top one percent saw its average after-tax income grow by 275 percent between 1979 and 2007.

Click on image to enlarge

The CBO report highlighted these points:

The share of after-tax household income for the top 1 percent of the population more than doubled, climbing to 17 percent in 2007 from nearly 8 percent in 1979.

The most affluent fifth of the population received 53 percent of after-tax household income in 2007, up from 43 percent in 1979. In other words, the after-tax income of the most affluent fifth exceeded the income of the other four-fifths of the population.

People in the lowest fifth of the population received about 5 percent of after-tax household income in 2007, down from 7 percent in 1979.

People in the middle three-fifths of the population saw their shares of after-tax income decline by 2 to 3 percentage points from 1979 to 2007.

There is also a great divide between how the Americans want the government to deal with this and the path that the government is headed down. The Occupy Wall Street protests across the country have started the news media talking about jobs and not the fake deficit/debt crisis. In a poll take by the New York Times and CBS, most Americans approve of the OCW movement:

and by two thirds believe that the wealthiest Americans should pay higher taxes:

and the wealthiest Americans agree. In a survey released by the Spectrum Group, 67% of those those with investments of $1 million or more support raising taxes on those with $1 million or more in income.

Their approval of Congress has hit a record low in the single digits:

nor do they approve of the way Barack Obama or Congress has handled creating jobs:

If anyone is still wondering why there are protests and people are fed up, then you are either not listening and reading or you are part of the problem.

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Robert Sheer: Thirty Years of Unleashed Greed

It is class warfare. But it was begun not by the tear-gassed, rain-soaked protesters asserting their constitutionally guaranteed right of peaceful assembly but rather the financial overlords who control all of the major levers of power in what passes for our democracy. It is they who subverted the American ideal of a nation of stakeholders in control of their economic and political destiny.

Between 1979 and 2007, as the Congressional Budget Office reported this week, the average real income of the top 1 percent grew by an astounding 275 percent. And that is after payment of the taxes that the superrich and their Republican apologists find so onerous.

Robert Reich: Wall Street is Still Out of Control, and Why Obama Should Call for Glass-Steagall and a Breakup of Big Banks

Next week President Obama travels to Wall Street where he’ll demand – in light of the Street’s continuing antics since the bailout, as well as its role in watering-down the Volcker rule – that the Glass-Steagall Act be resurrected and big banks be broken up.

I’m kidding. But it would be a smart move – politically and economically.

Politically smart because Mitt Romney is almost sure to be the Republican nominee, and Romney is the poster child for the pump-and-dump mentality that’s infected the financial industry and continues to jeopardize the American economy.

Occupy Wall Street NYC now has a web site for its General Assembly  with up dates and information. Very informative and user friendly. It has information about events, a bulletin board, groups and minutes of the GA meetings.

Late last night, Scott Olsen, a former Marine, two-time Iraq war veteran, and member of Iraq Veterans Against the War, sustained a skull fracture after being shot in the head with a police projectile while peacefully participating in an Occupy Oakland march.  The march began at a downtown library and headed towards City Hall in an effort to reclaim a site-recently cleared by police-that had previously served as an encampment for members of the 99% movement.

Scott joined the Marines in 2006, served two-tours in Iraq, and was discharged in 2010.  Scott moved to California from Wisconsin and currently works as a systems network administrator in Daly, California.  

Scott is one of an increasing number of war veterans who are participating in America’s growing Occupy movement. Said Keith Shannon, who deployed with Scott to Iraq, “Scott was marching with the 99% because he felt corporations and banks had too much control over our government, and that they weren’t being held accountable for their role in the economic downturn, which caused so many people to lose their jobs and their homes.”

Scott is currently sedated at a local hospital awaiting examination by a neurosurgeon.  Iraq Veterans Against the Wars sends their deepest condolences to Scott, his family, and his friends.  IVAW also sends their thanks to the brave folks who risked bodily harm to provide care to Scott immediately following the incident.

Keith Shannon, the roommate of injured Occupy Oakland protester Scott Olsen and a fellow Iraq War veteran, shares what happened Tuesday night when the Oakland Police Department fired upon the crowd with rubber bullets, bean bags and tear-gas canisters, one of which gave Olsen a skull fracture and trip to the emergency room. Shannon, himself a vocal protester, provides an update on Olsen’s condition – saying Olsen is “stable, but critical” – and says the incident has only bolstered his resolve to continue working for the movement.

In tonight’s Special Comment, Keith calls out Jean Quan, mayor of Oakland, for her use of 500 police officers in a pre-dawn raid Tuesday morning, followed by more tear-gas bombs, rubber bullets and bean-bag rounds on Tuesday night. Quan, herself once a victim of the Oakland police’s bullying, now “is the bully,” Keith says. He calls on Quan to dismiss acting Police Chief Howard Jordan and allow protesters to return to their location, “or, having betrayed everything she’d supported and all those who have supported her, she must resign.”

Hundreds of protesters in New York City marched on Wednesday night to show solidarity with protesters in Oakland, Calif., where the police used tear gas to disperse crowds a night earlier. About a dozen demonstrators were arrested in New York, the police said.

Just after 9 p.m., about 500 people left the Occupy Wall Street base in Zuccotti Park and went on a winding march around the financial district and City Hall, accompanied by drummers and a man playing the bagpipes as a helicopter followed overhead.

Less than an hour later, a smaller group of protesters poured into the streets, ignoring orders from police officers to stay on the sidewalk, and began a frantic cat-and-mouse game. More than 250 protesters walked quickly and sometimes ran through the streets of SoHo and the West Village, at one point storming through a movie set on Macdougal Street as groups of police vehicles with lights and sirens pursued them closely. People emerged from bars along the way asking what was going on and offering encouragement.

Yesterday afternoon Occupy Wall Street group Healthcare for the 99% marched to the headquarters of Empire Blue Cross Blue Shield, WellCare and St Vincent’s Community Hospital, a casualty of profit-driven insurers and a healthcare system that leaves 50 million Americans uninsured. Last night Keith’s guest, Dr. Steve Auerbach of Physicians for a National Healthcare Program, spoke about the need for affordable, accessible national healthcare.

This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.

Find the past “On This Day in History” here.

October 27 is the 300th day of the year (301st in leap years) in the Gregorian calendar. There are 65 days remaining until the end of the year.

On this day in 1904, the New York Subway opens.

While London boasts the world’s oldest underground train network (opened in 1863) and Boston built the first subway in the United States in 1897, the New York City subway soon became the largest American system. The first line, operated by the Interborough Rapid Transit Company (IRT), traveled 9.1 miles through 28 stations. Running from City Hall in lower Manhattan to Grand Central Terminal in midtown, and then heading west along 42nd Street to Times Square, the line finished by zipping north, all the way to 145th Street and Broadway in Harlem. On opening day, Mayor McClellan so enjoyed his stint as engineer that he stayed at the controls all the way from City Hall to 103rd Street.

History

A demonstration for an underground transit system in New York City was first built by Alfred Ely Beach in 1869. His Beach Pneumatic Transit only extended 312 feet (95 m) under Broadway in Lower Manhattan and exhibited his idea for a subway propelled by pneumatic tube technology. The tunnel was never extended for political and financial reasons, although extensions had been planned to take the tunnel southward to The Battery and northwards towards the Harlem River. The Beach subway was demolished when the BMT Broadway Line was built in the 1910s; thus, it was not integrated into the New York City Subway system.

The first underground line of the subway opened on October 27, 1904, almost 35 years after the opening of the first elevated line in New York City, which became the Ninth Avenue Line. The heavy 1888 snowstorm helped to demonstrate the benefits of an underground transportation system. The oldest structure still in use opened in 1885 as part of the BMT Lexington Avenue Line, and is now part of the BMT Jamaica Line in Brooklyn. The oldest right-of-way, that of the BMT West End Line, was in use in 1863 as a steam railroad called the Brooklyn, Bath and Coney Island Rail Road. The Staten Island Railway, which opened in 1860, currently uses R44 subway cars, but it has no links to the rest of the system and is not usually considered part of the subway proper.

By the time the first subway opened, the lines had been consolidated into two privately owned systems, the Brooklyn Rapid Transit Company (BRT, later Brooklyn-Manhattan Transit Corporation, BMT) and the Interborough Rapid Transit Company (IRT). The city was closely involved: all lines built for the IRT and most other lines built or improved for the BRT after 1913 were built by the city and leased to the companies. The first line of the city-owned and operated Independent Subway System (IND) opened in 1932; this system was intended to compete with the private systems and allow some of the elevated railways to be torn down, but was kept within the core of the City due to the low amount of startup capital provided to the municipal Board Of Transportation, the later MTA, by the state.[3] This required it to be run ‘at cost’, necessitating fares up to double the five cent fare popular at the time.

In 1940, the two private systems were bought by the city; some elevated lines closed immediately, and others closed soon after. Integration was slow, but several connections were built between the IND and BMT, and now operate as one division called the B Division. Since the IRT tunnel segments are too small and stations too narrow to accommodate  B Division cars, and contain curves too sharp for B Division cars, the IRT remains its own division, A Division.

The New York City Transit Authority, a public authority presided by New York City, was created in 1953 to take over subway, bus, and streetcar operations from the city, and was placed under control of the state-level Metropolitan Transportation Authority in 1968.

In 1934, transit workers of the BRT, IRT, and IND founded the Transport Workers Union of America, organized as Local 100. Local 100 remains the largest and most influential local of the labor union. Since the union’s founding, there have been three union strikes. In 1966, transit workers went on strike for 12 days, and again in 1980 for 11 days. On December 20, 2005, transit workers again went on strike over disputes with MTA regarding salary, pensions, retirement age, and health insurance costs. That strike lasted just under three days.

Those of you that read this regular series know that I am from Hackett, Arkansas, just a mile or so from the Oklahoma border, and just about 10 miles south of the Arkansas River.  It was a redneck sort of place, and just zoom onto my previous posts to understand a bit about it.

When I was in grade school in the second through forth or so grade Bobby Gene was one of the pupils.  Hackett was so small that there was only one class for each grade, so everyone of roughly the same age were in the same room.  Bobby Gene was in my class.  I am not using his last name on the distant chance that he might still be living, but even if here were I promise you that he would not read this.

Bobby Gene was what now would be called a special needs student, and I shall explain why later.  He was not a little “slow”, he was profoundly disabled.  He also had some physical problems, such as being very slight, and poor motor coordination.  These days he would be put into a special needs program and not in a regular class.  But we are talking about early 1906s Hackett, Arkansas.

2.24pm: I’ve just spoken to Keith Shannon, roommate of Scott Olsen, the Iraq veteran who is in hospital after apparently having been hit in the head by a police projectile.

Shannon said doctors told him Olsen has a “skull fracture and swelling of the brain”. A neurosurgeon will assess Olsen later today to determine whether he needs surgery, Shannon said.

Olsen, 24, was in 3rd Battalion, 4th Marines, before leaving the military last year. He had been opposed to the Iraq war even before his first tour to the country, Shannon said. Shannon and Olsen met in November or December 2005, and share an apartment in Daly City, south of San Francisco.

Rubber bullets and shotgun propelled bean bags can maim and kill, if the person is hit in the head, chest or abdomen. This is over-reaction by the Oakland Police on the orders of Oaklands Chinese-American mayor Jean Quan

While President Obama was telling the small crowd at a $7500-a-plate fundraiser in San Francisco that “Change is possible,” Pooda Miller was across the bay trying to get her plate back from the Oakland Police Department. “They came, pulled out rifles, shot us up with tear gas and took all our stuff,” said Miller, at an afternoon rally condemning the violent evacuation of more than 170 peaceful, unarmed Occupy Oaklanders by 500 heavily-armed members of the Oakland Police Department and other local departments yesterday morning.

Miller and others are calling for the recall of Jean Quan, who made history as Oakland’s first Asian-American mayor (full disclosure: Quan’s daughter is my Facebook friend); and they are complaining about the use of excessive police violence authorized by Interim Chief Howard Jordan, an African American. Such conflicts between former minorities are becoming the norm in what more conservative commentators call the “post-racial” era ushered in by the election of Obama.

Quan and Jordan are in the throes of dealing with a police department plagued by officer-involved shootings and killings, corruption and other crimes-crimes that have forced a federal consent decree to reform the department, after officers were convicted of planting evidence and beating suspects in West Oakland. Taking her cue from the Obama campaign of 2008, Quan announced Jordan’s appointment at a public safety forum titled “Creating Hope in the Community.”

Many like Miller and other Occupy Oaklanders are having second thoughts about what feels like the affirmative actioning of policing and state violence. Others, like Ofelia Cuevas of the University of California’s Center for New Racial Studies, see the workings of a not-so-21st-century pattern of policing and power.

From Slate, Why Isn’t Tear Gas Illegal?

Yes, but only in war. The 1993 Chemical Weapons Convention doesn’t apply to domestic law enforcement. (The United States was a major proponent of the exemption, fearing that the convention might be interpreted to prohibit lethal injection.)

[]

In enclosed spaces, however, the chemical agent can have much more serious effects. When police plan to use tear gas grenades to flush suspects out of a house, they start by comparing the dose of CS with the volume of the building and calculating a “lethal concentration time.” That’s the number of minutes it will take before most people inside would die from exposure. If the lethal concentration time is nearing, and the suspects haven’t yet emerged, the police start breaking windows for ventilation.

It’s not entirely clear how many people have been killed by CS. Amnesty International said 50 Palestinians died from inhalation in the late 1980s-prompting a brief suspension of tear gas sales to Israel-but those conclusions are disputed. The FBI used CS in its raid on the Branch Davidian compound (PDF) in Waco, but the ensuing fire left it unclear how, exactly, the cult members were killed. Such incidents have prompted a search for less toxic crowd-dispersing chemicals such as malodorants, but none has proven as effective as tear gas. Russia appears to be moving in the other direction, using the powerful opiate fentanyl to incapacitate rebels during a 2002 hostage crisis. That approach ended up killing more than 100 innocent people.

The United States is so enthusiastic about riot-control agents that it has a standing Executive Order reserving the right to use them on the battlefield, in spite of the Chemical Weapons Convention’s prohibition, to protect convoys or prevent the use of civilian shields. While the U.S. hasn’t invoked the order since ratifying the Convention in 1997, Donald Rumsfeld made news in 2003 when he raised the possibility.

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Wednesday is Ladies’ Day.

Katrina vanden Heuvel: The Republicans’ war on science and reason

Last month, Washington Post columnist Steve Pearlstein wrote that if you wanted to come up with a bumper sticker that defined the Republican Party’s platform it would be this: “Repeal the 20th century. Vote GOP.” With their unrelenting attempts to slash Social Security, end Medicare and Medicaid and destroy the social safety net, Republicans are, indeed, on a quest of reversal. But they have set their sights on an even bolder course than Pearlstein acknowledges in his column: It’s not just the 20th century they have targeted for repeal; it’s the 18th and 19th too.

The 18th century was defined, in many ways, by the Enlightenment, a philosophical movement based on the idea that reason, rational discourse and the advancement of knowledge, were the critical pillars of modern life. The leaders of the movement inspired the thinking of Charles Darwin, Thomas Jefferson and Ben Franklin; its tenets can be found in the Declaration of Independence and the U.S. Constitution. But more than 200 years later, those basic tenets – the very notion that facts and evidence matter – are being rejected, wholesale, by the 21st-century Republican Party.

Amy Goodman: Globalizing Dissent, From Tahrir Square to Liberty Plaza

The winds of change are blowing across the globe. What triggers such change, and when it will strike, is something that no one can predict.

Last Jan. 18, a courageous young woman in Egypt took a dangerous step. Asmaa Mahfouz was 25 years old, part of the April 6 Youth Movement, with thousands of young people engaging online in debate on the future of their country. They formed in 2008 to demonstrate solidarity with workers in the industrial city of Mahalla, Egypt. Then, in December 2010, a young man in Tunisia, Mohamed Bouazizi, set himself on fire to protest the frustration of a generation. His death sparked the uprising in Tunisia that toppled the long-reigning dictator, President Zine el-Abidine Ben Ali.

[]

Nine months later, Asmaa Mahfouz was giving a teach-in at Occupy Wall Street. Standing on steps above the crowd Monday night, she had a huge smile on her face as she looked out on a sea of faces. After she finished, I asked her what gave her strength. She answered with characteristic humility, speaking English: “I can’t believe it when I saw a million people join in the Tahrir Square. I’m not more brave, because I saw my colleagues, Egyptian, were going towards the policemen, when they just pushing us, and they died for all of us. So they are the one who are really brave and really strong. … I saw people, really, died in front of me, because they were protecting me and protecting others. So, they were the most brave, bravest men.”

The the tilt of the justice system that now favors the very elite took its sharpest turn with President Gerald Ford’s pardon of Richard Nixon. That pardon cost Ford his own term in the Oval Office and paved the way for future presidents to ignore the laws. In 2006, Americans infuriated with the corruption and crimes of the Bush administration, overwhelmingly threw out the Republicans from both houses of Congress. The electorate wanted the Bush cabal reigned in even if it meant the impeachment if both George W. Bush and his puppet master, Dick Cheney. They wanted the restoration of the balance of powers, the rules of law and the Constitution. So what did the Democratic leadership under House Speaker Nancy Pelosi and Majority Leader Sen. Harry Reid, do? They took impeachment off the table and paved the way for even more abuse of power by the executive branch, trampling of protected freedoms, and disregard for the law. President Barack Obama has refused to investigate the Bush administration crimes and has bent over backwards to continue to cover them up by hiding the evidence under the guise of national security. The current attempt by Obama and his Justice Department to exempt the banking industry from being held responsible for the fraud that brought this country to its economic knees, is a violation of his oath of office. The fact that the Americans are now fed up with our political system that has perpetuated this is now evident across this country with Occupy Wall Street. Our elected officials need to start listening, the message is clear, hold the criminals responsible whether it be Wall St., the banks or our elected representatives.

Glenn Greenwald, contributing editor for Salon and author of the new book, “Liberty and Justice for Some”, talks with Rachel Maddow about how the justice system in the United States has become corrupted such that powerful people are not prosecuted for breaking the law.

As multiple episodes demonstrate, a belief that elite immunity is both necessary and justified became the prevailing ethos in the nation’s most influential circles. In countless instances over recent years, prominent political and media figures have insisted that serious crimes by the most powerful should be overlooked- either in the name of the common good, or in the name of a warped conception of fairness according to which those with the greatest power are the most entitled to deference and understanding.

This is what makes the contemporary form of American lawlessness new and unprecedented. It is now perfectly common, and perfectly acceptable, to openly advocate elite immunity. And this advocacy has had its intended effect: the United States has become a nation that does not apply the rule of law to its elite class, which is another way of saying that the United States does not apply the rule of law. . . .

If the threat of real punishment for criminality is removed, for many rational people there will be little incentive to abide by the law and much incentive to break it. Alexander Hamilton, in Federalist 15, explained why.

   “It is essential to the idea of a law, that it be attended with a sanction; or, in other words, a penalty or punishment for disobedience. If there be no penalty annexed to disobedience, the resolutions or commands which pretend to be laws will, in fact, amount to nothing more than advice or recommendation.”

For the nation’s most powerful elites, the law has indeed been whittled down to “nothing more than advice or recommendation.” Although there have been episodes of unpunished elite malfeasance throughout American history, the explicit, systematic embrace of the notion that such malfeasance should be shielded from legal consequences begins with the Watergate scandal- one of the clearest cases of widespread, deliberate criminality at the highest level of the U.S. government.

Occupy Wall Street NYC now has a web site for its General Assembly  with up dates and information. Very informative and user friendly. It has information about events, a bulletin board, groups and minutes of the GA meetings.

Date/Time

Date(s) – 26 Oct 2011

3:00 PM – 7:00 PM

Location

Liberty Plaza

Under the Big Red Thing

   March

Time:

3:00pm Sign Making in Liberty Plaza

4:00pm Open Speakout – come share your personal struggles with our healthcare system

4:30pm March Against the Health Insurance Industry

March Details:

4:30pm – Empire Blue Cross Blue Shield / One Liberty Plaza: located across the street from Zuccotti park, Empire is a subsidiary of WellPoint, the largest publicly-traded health insurance company. CEO Angela Braley’s overall compensation is $13.1 million dollars, enough to cover 1455 New Yorkers.

5:30pm – WellCare / 110 5th Ave: the for-profit company that administers Medicaid and Medicare Advantage programs in New York and other states. Currently being investigated for fraud with estimates that WellCare illegally siphoned $400 million to $600 million from state health insurance programs for the poor. (1)

6pm – St Vincent’s Community Hospital / 12th St & 7th Ave: closed earlier this year due to bankruptcy, St Vincent’s is a casualty of profit-driven insurers and a healthcare system that leaves 50 million Americans uninsured. There are now no hospitals on the westside below 57th st.

From our friend evenyc at Daily Kos

OAKLAND — Police fired tear gas at least five times Tuesday night into a crowd of several hundred protesters backing the Occupy movement who unsuccessfully tried to retake an encampment outside Oakland City Hall that officers had cleared away more than 12 hours earlier.

Police gave repeated warnings to protesters to disperse from the entrance to Frank Ogawa Plaza at 14th Street and Broadway before firing several tear gas canisters into the crowd at about 7:45 p.m. Police had announced over a loudspeaker that those who refused to leave could be targeted by “chemical agents.”